Comerford & Ors v Roads and Traffic Authority of New South Wales [2004] HCATrans 139 (30 April 2004)

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Comerford & Ors v Roads and Traffic Authority of New South Wales [2004] HCATrans 139 (30 April 2004)

Last Updated: 10 May 2004

[2004] HCATrans 139

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Sydney Nos S113 of 2001 and S87 of 2003

B e t w e e n -

WILLIAM KEVIN COMERFORD, KENNETH BRIAN COMERFORD, JOHN LEWIS HIRIAM COMERFORD trading as YURINGO PASTORAL CO

Applicants

and

ROADS AND TRAFFIC AUTHORITY OF NEW SOUTH WALES

Respondent

Applications for special leave to appeal

McHUGH J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 30 APRIL 2004, AT 10.11 AM

Copyright in the High Court of Australia

MR B.W. COLLINS, QC: If your Honours please, I appear for the Messrs Comerfords, who are the applicants in both applications, with my learned friend, MR S.Y. REUBEN. (instructed by Cordato Partners)

MR M.G. RUDGE, SC: May it please the Court, I appear with my learned friend, MR D.A.C. ROBERTSON, for the respondent in each of those applications. (instructed by Crown Solicitor’s Office (New South Wales))

McHUGH J: Yes, Mr Collins. Mr Collins, you have two matters here. I think it would be appropriate in the circumstances that I give each side 30 minutes.

MR COLLINS: I hope to finish it earlier, your Honour, but I am grateful to your Honour for saying that. Your Honours, Mr Justice Giles, now of the New South Wales Court of Appeal, had occasion to describe what this case is all about. In this particular case he was dealing with, he looked at what happens after a referee delivers a report to the court, after the invocation of a reference under Part 72, and what his Honour described that process as being was the exercise of the court’s discretion which is interposed between the referee’s opinion and finality in the resolution of the dispute.

What both these applications raise, your Honours, are a number of questions which concern the existence and the nature of the discretion given to the court under Part 72 in that period which lies between the delivery to the court of a report under that particular part and before the giving of final judgment. All of the questions, your Honours, involve the nature of that discretion, and they involve the intersection of those discretionary powers with other principles that I will refer to in a moment.

Your Honour, this Court has never looked at the nature of the discretion that the Supreme Court exercises between the delivery of a report and the entry or the giving of judgment. The closest these questions have come to being agitated is in the New South Wales Court of Appeal, principally in the SPF Case, which we do not challenge. Those cases in that line of authority can be placed entirely to one side because we do not challenge for a moment the application of established principles - - -

McHUGH J: Did you say the SPF Case? Do you mean the Super Pty Ltd Case?

MR COLLINS: Yes, the Super Case. Now, those principles, with which your Honour, of course, is well familiar, are not under challenge in this case. In other words, we do not cavil for a moment with the principles which have been established in New South Wales, which regulate the rights of a party to make particular challenges to a referee’s report. This is not about that at all. What it is about is what the court can do once a report has been delivered. Your Honour, there are two application books. In order to expose the point in its best form, I want to refer simply to four reference points, if I may.

Your Honours, sent up in the supplementary materials there is a bundle of papers which, taken from the practice books, give your Honours the contents of Part 72. If I could just remind your Honours of the key elements in that particular part, which we say the Court of Appeal has defined out of existence in both cases. If your Honours look at the papers that were sent up the day before yesterday, Part 72 rule 2 gives a power to the court to refer:

at any stage of the proceedings, on application by a party or of its own motion . . . to a referee appointed by the Court for inquiry and report by the referee on the whole of the proceedings or any question or questions arising in the proceedings.

If your Honours turn the page, your Honours see sub-rule 5, I have just noticed:

(1)	Where the Court makes orders under rule 2 the Court may, at any time and from time to time –

(a)	authorise the referee to inquire into and report upon any facts relevant to the inquiry and report on the matter referred;
(b)	direct the referee to make a further or supplemental report or inquiry and report –

Then, sub-rule 8:

(1)	Where the Court makes an order under rule 2, the Court may give directions with respect to the conduct –

Two pages over, your Honours, sub-rule 9:

The Court may, at any time and from time to time, on motion of the referee or of a party, give directions with respect to any matter –

Sub-rule 10:

(1)	The Court may, of its own motion or on application by a referee or a party set aside or vary any order made under rule 2.

And 13:

(1)	Where a report is made, the Court may, of its own motion, after notice to the parties, or on application by any party, on a matter of fact or law or both –

. . .

(d)	decide any matter on the evidence taken before the referee, with or without additional evidence –

Now, the burden of both applications, in one sense, is that the Court of Appeal in both cases have acted as if the words “with or without additional evidence” did not appear.

McHUGH J: Well, not necessarily. What was said in the Super Pty Ltd Case is that you cannot treat the proceedings before the referee as some kind of warm-up for the real contest. The argument that is put against you is that you are not entitled, as of right, to require the judge to reconsider and determine afresh all the issues of fact or law - - -

MR COLLINS: That is not what we did, of course, your Honour.

McHUGH J: - - - and that the matter has to be considered, the exercise of the discretion has to be considered, in a manner that is consistent with the object and purpose of the Rules and the wider setting in which they take place.

MR COLLINS: Yes.

McHUGH J: What is put against you is that the wider setting is that the principles in cases like Piening v Wanless and Eggins v Brooms Head are equally applicable here as they are in an ordinary trial. Now, what is your answer to that? That seems to me to be the crux of the matter.

MR COLLINS: It is certainly the crux, your Honour, and what we put is this, that everything your Honour has said about the Super Case is, with great respect, correct. That was a case in which an attempt was made to challenge the report of a referee. The whole of this application is predicated upon the basis that his Honour Mr Justice Hunter said there will be no challenge to anything in the second report.

McHUGH J: But you want to raise something that you actually conceded.

MR COLLINS: Counsel who opened the case did not concede it, your Honour, he said that he was not opening on that basis. There is no question about that. We accept that without demur. But in this particular case, the issue that arose arose because his Honour drew the parties’ attention to it. It was not a case of an application being made by one or other or both of the parties.. His Honour said, “I want to hear you both on this. I have read what the report says, the second report, and it raises an issue which was dealt with in the evidence before the referees, was made the subject of cross-examination, but it is not covered by the pleadings”. And his Honour made special mention of the fact that it had not been opened on. In those circumstances, a very experienced - - -

CALLINAN J: Extraordinary piece of intervention by the judge, I thought.

MR COLLINS: Well, your Honour - - -

CALLINAN J: This is adversarial litigation between the parties, on pleadings, and here is the judge, who has sent the matter off to a referee, then it comes back, and the judge wants to raise an entirely new point.

MR COLLINS: And gave the parties, your Honour, an opportunity to deal with it, as a consequence of having raised it. For those reasons, what this case deals with, your Honours, is nothing like the Super Case, where there was a challenge by a party who, in effect, wanted to have a re-run.

CALLINAN J: I must say, though, I think this sort of procedure is a recipe for precisely the problems that are raised here: piecemeal litigation, half of it being determined by a referee, half of it by a judge. Judges should sit and decide cases. I would have thought that this rule ought only to be invoked in exceptional cases.

MR COLLINS: Your Honour, we would, with great respect, accept everything your Honour has just said, and, having read the transcript of the first application, what your Honour just said is similar to something that fell from your Honour on that occasion. That is precisely what his Honour was doing here, in our respectful submission. He noticed that an issue had been run aggressively before the referees on the second reference, and it was not the subject of any opening, any pleading. It was just bare in the report. He called the parties back and said, “Look, there is an issue which has been litigated before the referee, but, in the light of Brodie, I want to hear what both of you have to say about how I treat the matter further”.

Your Honour Mr Justice McHugh has asked me about Piening v Wanless. Could I take your Honour to that part of the judgment in the second Court of Appeal case which deals with that, in order to answer your Honour’s question. In that particular judgment, the main judgment being that of Mr Justice Meagher that your Honours will see in application book 2 at page 103 – Piening v Wanless, your Honours, was not referred to in the first Court of Appeal decision, but the court deals with that particular proposition that your Honour Mr Justice McHugh asked me to deal with at paragraph 16 on page 103. The burden of that particular part of the judgment is that before you can apply Piening v Wanless and Eggins v Brooms Head Bowling & Recreational Club to the present case, it is essential that one properly characterise what had happened here, as if it were a trial.

Now, those provisions in Part 72 to which I took your Honours a few moments ago stand as an obstacle to that conclusion. Once it is accepted that there lies between the delivery of the report to the court and the giving of final judgment a series of discretionary steps, each of which is expressly described in those sub-rules to which I made reference, then it is not possible for one to conclude that a trial has been concluded. In other words, Piening v Wanless, which was a jury case, your Honours – in that particular case, a jury had brought in a verdict. In Eggins v Brooms Head Bowling & Recreational Club, the party seeking to raise the new point did so on appeal. In our submission, one could not conceive of two cases further away from the present case.

More to the point, not only did the Court of Appeal equate the Part 72 procedures with the discretion lying between delivery of the report and judgment with a trial, it did so on the basis of something said by his Honour Mr Justice Gleeson, then Chief Justice of this State, in Super, and his Honour Mr Justice Meagher said that he was quoting the observations of Stephen as authority for the proposition that the hearing of a reference is the equivalent of a trial. Now, your Honours, when one examines the decision of Mr Justice Stephen in Buckley v Bennell, it can be seen that his Honour Mr Justice McHugh has fallen into - - -

McHUGH J: You mean Mr Justice Meagher.

MR COLLINS: Mr Justice Meagher. I am ahead of myself, your Honour.

McHUGH J: You sound very pessimistic.

MR COLLINS: No, no, not at all, your Honour. What Mr Justice Meagher was there doing was to draw support, so he thought, from something Mr Justice Stephen said, but in that particular case, Buckley v Bennell – I do not think I need to hand this to your Honours, but I want to read to your Honours the relevant provision which was there under consideration. It was a section of the Arbitration Act 1902 (NSW), which contained an express provision which equated the report prepared by the referee with the verdict of a jury.

Now, insofar as his Honour Mr Justice Meagher said that that provided any support for the proposition that what a referee does, when he prepares a report under Part 72, is concerned – there was no basis at all for making that comparison. In the particular piece of legislation under examination, there was this provision that said the opinion of the referee is the equivalent of a jury, and, of course, if Part 72 had a provision of that kind, then his Honour would have been right. But his Honour fell into significant error in thinking for a moment that there was anything in either Super or - - -

McHUGH J: Now, what is the special leave point? The questions stated in your application are open to serious criticism, as are many formulations. A question for the purposes of a special leave application is something that should be answered “Yes” or “No”. Does section 92 of the Constitution preclude convicts from coming into New South Wales? Answer “Yes” or “No”. This says the special leave questions are “The considerations which ought to apply”. They do not tell you anything. You get other cases – we have one in the list later today. It says “How is something to be done”.

MR COLLINS: Yes.

McHUGH J: Now, what is the special leave?

MR COLLINS: We deal with it this way, your Honour. To take Piening v Wanless for one example, the question would be whether Piening v Wanless can be applied (1) at all to a Part 72 reference, on the basis that it was a trial, or (2) whether Piening v Wanless displaces all of the other general discretionary considerations of the kind which his Honour Mr Justice Hunter looked at in great detail in several parts of this judgment. In the course of doing that, your Honours would be looking at the general powers of the court under Part 72, but, to distil the principles to two discrete questions of the kind that your Honour mentioned a moment ago, those would be the two key questions.

A third, more general, question would be framed thus, whether the undoubted discretion conferred upon the Supreme Court by Part 72 may be circumscribed in the manner the Court of Appeal sought to do so in both cases – Court of Appeal 1 and Court of Appeal 2. Those would be the three questions which satisfy the test that your Honour referred to. They would properly dispose of this case, and we say that it is a suitable vehicle for doing so.

McHUGH J: Well, what makes it difficult to say it is a suitable vehicle is, I suppose, in one sense, it is involved in this particular question. I was going to say that you have conceded – well, you did not raise these points below, but you say that is the very point. The very point of the case is: not having raised these matters before the referee, is it then open to a court to reject your application to raise the issue before the judge on the return of the reference?

MR COLLINS: Yes. There are two parts to the answer, your Honour. First of all, one is in the glorious position of being able to answer that question with absolute certainty, not having been there. The answer is that the points were not raised. There is no doubt about that whatever, and I do concede that, your Honour. One cannot see in any way, shape or form that the two questions we seek to raise now were raised. But, as to that, we say that Brodie was the factor which enlivened his Honour’s interest in allowing this question to be raised, and - - -

CALLINAN J: Mr Collins, I suppose the legal fiction is that Brodie has always been the law. It is a legal fiction, we know, and it is a very, very good reason, perhaps, for courts being extremely cautious in making radical, real changes in the law, but the point was available to be taken, presumably, for 100 years.

MR COLLINS: It could have been, and, of course, if I may say so without being impudent, your Honour’s observation in that connection comes as no surprise, in the light of your Honour’s dissenting judgement in Brodie.

CALLINAN J: And it can cause exactly what you say, injustice - - -

MR COLLINS: It can, yes, but if I can give a non-frivolous answer, your Honour, the real answer is that what his Honour Mr Justice Hunter said was – and he had been tracking Brodie. He had referred Brodie to the parties on three or four occasions, and there are traces in the application books of his Honour tracking Brodie even before the application for special leave came on. Of course, that was a case which was remarkably similar on the facts to this case. But when his Honour saw the referee’s report, he said, “Now, look here, an issue has been fought before the referees as to whether or not it was reasonably foreseeable that something like this would happen”, and in the light of Brodie which, as his Honour saw it, opened up the question of a failure to warn in what was essentially, at base level, a nonfeasance case, his Honour said - - -

CALLINAN J: Mr Collins, if in fact Justice Hunter was tracking and had made references to it, well, then, perhaps the parties should have taken the hint, or your client should have - - -

MR COLLINS: It was too late for them to do that, your Honour. But what his Honour did was - - -

CALLINAN J: But they never took it, did they? The judge took it, really, in the - - -

MR COLLINS: Well, he offered it to the parties, and, of course - - -

CALLINAN J: Your client, or whoever was representing your client, never sought to amend or take the hint, as it were, from Justice Hunter earlier given.

MR COLLINS: No, well, your Honour, they accepted the - - -

CALLINAN J: It was a positive intervention by Justice Hunter, intrusion, some might even say, into the parties’ litigation.

MR COLLINS: Yes, well, the failure to warn case was in fact pleaded soon, on the heels of his Honour raising it, and it is in the pleadings now. His Honour in four places said that that was opened up by Brodie. He said that if there was a liability in the highway authority for acts which would otherwise have attracted the immunity in the nonfeasance/misfeasance dichotomy, that has now been swept away, “Even now, take the point if you want to”. Then there was a directions hearing and the pleading went on, and that is the pleading we have at the moment.

CALLINAN J: Can I ask you another question – I do not think it is referred to anywhere. Does the Road Traffic Authority - is it established under which Act?

MR COLLINS: I think it is called the Roads and Traffic Authority Act, is it not?

CALLINAN J: I only ask that because I have a recollection, in Brodie, that the Act that applied to the State authority, as opposed to a municipal authority, actually used the expression “immunity”. I think I referred to it in my judgement in Brodie.

MR COLLINS: Yes, I do recall your Honour saying something - - -

CALLINAN J: So it may be, if that is right, that at the end of the day the Roads and Traffic Authority may be in a different position from the local authority in Brodie.

MR COLLINS: Your Honour, the pleadings have not fleshed out that point yet. We would say it makes no distinction to the key question, which is whether Brodie opened up the point, and whether or not - - -

CALLINAN J: If there is a reference to immunity, it may be that in the end it would not matter, that may afford a defence in any event - - -

MR COLLINS: It may be an absolute defence, yes.

CALLINAN J: - - - to a nonfeasance claim.

MR COLLINS: That spectre has not loomed on the Comerfords’ horizon to this point, your Honour. Your Honour, the essence of the errors which we say are to be found in the - - -

McHUGH J: In paragraph 3.6 of the original book filed, at page 120, you accept the principle in Piening - - -

MR COLLINS: We do.

McHUGH J: - - - applies to a trial on questions of fact referred to the referee, but you seem to say that because the matter is not ended with the referee’s report, therefore, Piening v Wanless is irrelevant.

MR COLLINS: That is so. If it was correct to say that Piening v Wanless apply to a Part 72 reference, your Honour, then, without more, one would need to take no trouble to read all of those discretionary provisions to which I referred earlier. It would mean that none of them, as a matter of law, could be given any operation or any application at all, because Piening would simply overtake them.

McHUGH J: Why do you say that?

MR COLLINS: Well, the lynchpin to that particular proposition is that that principle only applies if there has been a trial in the proper sense of the word, and there has not been a trial in the proper sense of the word concluded unless and until there is either a verdict or a judgment. The particular provisions in Part 72 to which I have taken your Honours make it quite clear that there is what Mr Justice Giles refers to, this important residual discretion standing between the delivery of a report and the entry of judgment.

If it were otherwise, no judge, whether there is an exercise in case management or not, could ever express any form of dissatisfaction about the way in which the reference was conducted or the way in which the answers were delivered to him. He would be nothing more than a glorified dispatch clerk, sending the case to a referee, and then an incoming receipts clerk, picking up the report and taking out a large stamp, abdicating any intellectual or review functions at all, and stamping the matter. If the report was written in English on white paper and appeared to deal with something that was cognate to the case, on this theory of things, the judge simply stamps it. Now if, and to the extent that Mr Justice Callinan finds offensive the idea of Part 72, a problem with which, I must acknowledge, I share your Honour’s view - - -

CALLINAN J: It is the law, Mr Collins.

MR COLLINS: I have a strange view about it, your Honour, I think judges should decide cases as well. But if your Honour Mr Justice Callinan is offended by that, offended by the proposition that a judge refers a matter to a referee, how much more excited would your Honour get if your Honour were to be told that once the referee has done his job, the judge is powerless to do anything upon the return of the report? And that is - - -

McHUGH J: But may not a distinction be drawn between a case where the judge sends certain questions out and where the judge sends the whole question of liability out, which appears to be the case here?

MR COLLINS: Your Honour, that is a distinction, and we would respectfully submit that in those limited cases – and your Honours no doubt have in mind the history of provisions like this in England, where a very narrow question goes out to an expert to conduct a chemical experiment, that fact comes back in, it is plugged back into the factual continuum, and the judge takes it into account together with other evidence. But the vice in this case which is put against us is no more or less than the fact that what Mr Justice Hunter wanted to do was what your Honour Mr Justice Callinan says he should have done in the first place, namely, hear some evidence. That came about because the first report was a challenge by the Roads and Traffic Authority against my clients. They had to - - -

CALLINAN J: There was a problem about the order, was there not?

MR COLLINS: Yes.

CALLINAN J: As appears at page 100 of Justice Meagher in the application book, paragraph 9:

[His Honour] granted the parties leave to adduce further evidence “limited to the issue of the Authority’s alleged negligence and consistently with the findings of the first report as adopted.”

That was the order he made.

MR COLLINS: Exactly, your Honour, yes.

CALLINAN J: Well, what if the facts were inconsistent with the first report? I mean it seems to have been a very artificial exercise on any view of it.

MR COLLINS: I understand your Honour’s point, and we meet it this way, your Honour. Firstly, his Honour said that the conclusions in both reports, one of which was adopted by Mr Justice Einstein over my learned friend’s objection – that report is inviolable. His Honour then said the second report is similarly inviolable. His Honour was saying no more or less than Super, “I am not going to let you challenge anything that is in that report, but you can, if you wish, call some evidence upon the question whether or not the Roads and Traffic Authority was under an obligation to warn or take other prophylactic measures to prevent this accident happening”.

Your Honour, whether or not, as your Honour Mr Justice McHugh said, all issues are referred out, or only some are referred out, that question cannot say anything, in our submission, as to the existence of the discretion which stands between delivery of a report and judgment. Those discretionary powers cannot be said to be more or less substantial, or existent or non-existent, by dint of the fact that the judge had prior thereto chosen to refer all questions out.

If Part 72 is to work, it is our respectful submission that the judge has an important supervisory role to play. If there is some kind of miscarriage or frolic in the course of the reference, or if, as in this case, there has been a point which arose with crystal clarity during the reference, namely, should these chaps at the RTA have known about this problem, and then taken steps – his Honour read all of that and said, “Look, here, that was an issue before the referees, but no one has pleaded it. I have this residual discretion, this bank of powers, between delivery of a report and judgment, I am going to exercise those and simply ask the parties whether they want to deal with that now in proper form”. That is all he did. Rather unspectacular, we respectfully submit, but nevertheless spot on.

What the Court of Appeal said was, “Well, look, you cannot do that because we are going to equate a Part 72 report delivered with a completed trial, the verdict of a jury”. With great respect to the Court of Appeal, your Honour, that is nonsense. That is not what Mr Justice Stephen said in Buckley v Bennell, and his Honour was way off track in applying the provisions of the 1902 Act to the provisions of Part 72. It is chalk and cheese.

CALLINAN J: Mr Collins, that other point I raised with you will not have any substance in it because section 12 of the State Roads Act says the Authority has and may exercise in relation to a classified road or a toll road the functions and immunities of a council, and, of course, Brodie has held that there is no immunity. It makes the whole section meaningless, the decision.

MR COLLINS: We would say it boilerplates Brodie, and if your Honour were reading Brodie as a - - -

CALLINAN J: Well, it just makes that piece of legislation totally misconceived - - -

MR COLLINS: It does.

CALLINAN J: The legislature had no idea what it was doing.

MR COLLINS: It self-executes, yes. Your Honours, the first Court of Appeal judgment has these vices in it. First of all, what the Court of Appeal said – and I have taken 30 minutes, your Honour, so may I conclude with this point, which I have not dealt with. The Court of Appeal said, “Look, it is an abuse of process to re-open in this way” - - -

McHUGH J: Well, but Justice Handley, with whose judgment Justice Sheller agreed, said that the order that Justice Hunter made on the second occasion was inconsistent with the order that was made on 8 December 2000, because the only matter that the judge had to consider was whether the report of the referee should be adopted.

MR COLLINS: Yes. Well, of course, Brodie had intervened, your Honour. When your Honours read his Honour Mr Justice Hunter’s judgment, at page 60, his Honour set out ten separate matters which he said bore upon the exercise of his discretion. Then, at page 80, his Honour addressed each and every one of those, and the signal feature of this case is that the Court of Appeal did not in any way, shape or form fault his Honour’s assessment of those discretionary matters. What it said was, “We are going to place a super-added obstacle which rides over and above all of those matters, and it is Piening v Wanless”. They do that by equating a report with the verdict of a jury, which we say is wrong, and then all of those discretionary matters which his Honour set out over several pages of the application book are to be utterly displaced, thereby writing out all of those discretionary provisions that we have referred to earlier.

Now, that is the key issue in the case, your Honour. It cannot be put any more succinctly than that. We would respectfully submit that what that does is fairly and squarely raise the real question which has been burning a hole in your Honour Mr Justice Callinan’s breast, which is, what on earth does a judge do? Is he just there as some kind of cardboard cut-out, simply to receive a referee’s report, or does he have, and is thereby obliged to
exercise, the powers that are expressly given to him under Part 72, to say nothing about the inherent powers of a superior court of record in any event?

The two Court of Appeal judgments are so interrelated in terms of the way in which those principles contaminate each judgment, that if one comes down, they both come down. They are our submissions, your Honour.

McHUGH J: Thank you. We need not hear you, Mr Rudge.

The Court is of the view that if special leave were granted an appeal in this case would have insufficient prospects of success. Accordingly, the application is refused with costs.

The Court will now adjourn to reconstitute.

AT 10.42 AM THE MATTER WAS CONCLUDED