Air Link Pty Ltd v Paterson; Agtrack (NT) Pty Ltd v Hatfield [2005] HCATrans 118 (8 March 2005)

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Air Link Pty Ltd v Paterson; Agtrack (NT) Pty Ltd v Hatfield [2005] HCATrans 118 (8 March 2005)

Last Updated: 8 March 2005

[2005] HCATrans 118

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Sydney No S420 of 2004

B e t w e e n -

AIR LINK PTY LIMITED

Appellant

and

MALCOLM IAN PATERSON

Respondent

Office of the Registry
Melbourne No M192 of 2004

B e t w e e n -

AGTRACK (NT) PTY LTD (TRADING AS SPRING AIR)

Appellant

and

ANN CHRISTINE HATFIELD

Respondent

GLEESON CJ
McHUGH J
GUMMOW J
KIRBY J
HAYNE J
CALLINAN J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON TUESDAY, 8 MARCH 2005, AT 10.19 AM

Copyright in the High Court of Australia

__________________

MR R.F. MARGO, SC: May it please, your Honours, I appear with
MR R.M. PETERS, and MR M.J. LEEMING, for each of the appellants. (instructed by Norton White)

MR D.F. JACKSON, QC: If the Court pleases, I appear with my learned friend, MR P.A. REGATTIERI, for the respondent in Air Link v Paterson and also for the same person who is an applicant for special leave in that matter. (instructed by M J Duffy & Son)

MR A.G. UREN, QC: If the Court pleases, I appear with my learned friend, MR P.F. O’DWYER, SC, for the respondent in the Agtrack matter. (instructed by Slater & Gordon)

MR H.C. BURMESTER, QC: If it please the Court, I appear with my learned friend, MR B.F. QUINN, for the Attorney-General for the Commonwealth intervening in both matters. (instructed by the Australian Government Solicitor)

MR R.J. MEADOWS, QC, Solicitor-General for the State of Western Australia: May it please the Court, I appear with my learned friend, MR R.M MITCHELL, on behalf of the Attorney-General for Western Australia intervening in support of the respondents. (instructed by State Solicitor’s Office)

MR M.G. SEXTON, QC, Solicitor-General for the State of New South Wales: If the Court pleases, I appear with my learned friend, MR J.G. RENWICK, for the Attorney-General for New South Wales, who intervenes in both matters. (instructed by Crown Solicitor for New South Wales)

MR C.J. KOURAKIS, QC, Solicitor-General for the State of South Australia: If the Court pleases, I appear with my learned friend, MS A. RAO, for the Attorney-General for South Australia intervening in both matters. (instructed by Crown Solicitor’s Office South Australia))

MS P.M. TATE, SC: May it please the Court, I appear for the Attorney-General for Victoria intervening in both matters in support of the respondents with my learned friend, MR S.G.E. McLEISH. (instructed by Victorian Government Solicitor)

GLEESON CJ: Yes, Mr Margo.

MR MARGO: Thank you, your Honours. There has been an agreement as to time. May I take your Honours first to the Commonwealth Act. In our submissions we said that if one considers carefully the structure of the Commonwealth Act, it will appear that a single regime was intended to travel throughout all parts, and I seek to make that general submission good by taking your Honours to the statute.

If your Honours have the fourth reprint, that is the latest reprint, that will suffice. The only amendments since are marked in annexure A to the submissions of each appellant but they are not material for what I wish to take your Honours to now. If your Honours would go first, please, to page 3 in section 8, the text of the Conventions,8(2), your Honours will be aware if there is any inconsistency the French texts will prevail and we do have the French text in later material to which I will take your Honours. That should be read with section 19 which makes it clear that what we are dealing with here is domestic legislation, not with direction application of a treaty, and that exclusive jurisdiction of the Court is therefore not engaged.

GUMMOW J: Sorry, what section?

MR MARGO: Section 19, your Honours. I wish to make the point that although Parts II, III and IIIC apply the English text to the Convention schedule to the Act, they are as much domestic legislation as Part IV.

KIRBY J: We learned in the DVT litigation that different parts came into operation at different times.

MR MARGO: Annexure D to each appellant’s submissions gives your Honours that information but we are not concerned in these appeals with any international carriage, your Honour.

KIRBY J: I realise that, so we do not have to concern ourselves - - -

MR MARGO: I can tell your Honour that the Warsaw Convention was proclaimed first by the Carriage by Air Act but that was repealed by this Act and it came into force under this Act on 21 April 1959, that is Schedule 1. Your Honours can see this in section 8(1).

The Warsaw Convention as amended at The Hague was proclaimed on 1 November 1963. The Guadalajara Convention for Australia came into force on 1 May 1964. The Montreal No 3 Convention has not come into force in Australia. The Montreal No 4 Convention came into force on 22 June 1988. That is the one that your Honours considered in Povey. If I could go then, your Honours, to Part II of the Act.

GUMMOW J: Do we not have to look at section 13?

MR MARGO: Not on this appeal, your Honours, but we look at the equivalent of that section in Part IV. If I could take your Honours quickly through Part II – this actually applies to the Warsaw Convention as amended at The Hague. The purpose in taking your Honours very quickly through it is to show that, contrary to the majority opinions in the courts below, there is a structural consistency between, for example, Part II and Part IV.

It is not the case that Part II simply applies the text of the Convention, whereas Part IV does it by provisions. There are many provisions in Part II which have their parallels in Part IV. The first is section 12 – 11 gives the provisions of the Warsaw Hague Convention the force of law in Australia and that picks up, of course, Article 29. Then section 12, “Liability in respect of death”, is paralleled by section 35 in Part IV, and 12(2) is the making of an exclusive remedy under Part II, and that is also paralleled in section 35 of Part IV. Then section 13, “Liability in respect of injury” – mentioned by your Honour Justice Gummow – is paralleled in section 36 of Part IV. Section 14 is paralleled in section 37 of Part IV, section 15 is paralleled in section 38, section 16 is paralleled in section 39.

If I could take your Honours then to page 10 of the reprint. Part IIIC is not reproduced, except at the end, because it had not come into operation at the time of the reprint, which I will take your Honours to shortly. That is the Montreal No 4 Convention. Part IV, “Other carriage”. The definition of “airline licence” – it is either:

(a) an international airline licence . . . under the Air Navigation Regulations; or
(b) an Air Operator’s Certificate . . . under the Civil Aviation Act 1988 –

both Commonwealth Acts, and that, we submit, is a necessary integer of the statutory right that has to be pleaded as material fact. “Charter licence”, “commercial transport operations” are defined on the next page. There is a subsequent amendment which introduced a definition of “domestic carrier” but your Honours do not need to worry about that at the moment.

Then section 27 gives rise to what his Honour Justice Ormiston referred to in the court below in Victoria as jurisdictional facts which, we submit, were necessary to be pleaded in this case:

(1) This Part applies to the carriage of a passenger where the passenger is or is to be carried in an aircraft being operated by the holder of an airline licence or a charter licence –

so that is the hook on which Commonwealth – it becomes federal carriage under this part –

in the course of commercial transport operations –

and then it is between a place – it is either interstate or between the Territory and a State or intra-territory or, and this may be significant in considering what the legislature intended, it also covers all international traffic not covered by another part of the Act. Some countries are not party to any form of the Convention and so traffic, for example, with Thailand would be covered by Part IV.

Then, relevant to the Air Link appeal, the contract of carriage as evidenced by the ticket is an important element in the Warsaw Convention regime and what is provided in subsection (4) is that if you have a multistage journey covered by a ticket, whether there is more than one ticket, but “regarded by the parties as a single operation”, then if a particular carrier, and the carrier in Air Link was such a carrier, performs one leg of that carriage, and Air Link was not the ticket-issuing party in this case, it was Qantas, that will be treated as federal carriage under this part. Then section 28 is “Liability of the carrier for death or injury” and that picks up Article 17 of the Convention regime. Your Honours will have seen from our submissions that it is not necessary to distinguish for purposes of these appeals between different forms of the Convention. The relevant provisions are the same in all of them and they are compared in annexure D to the submissions of each appellant.

If I could take your Honours to section 31, “Limitation of liability”, the definition of “domestic carrier” that was introduced in July 1995 also introduced a different limit not relevant for the appeals, but I mention to your Honours it is now $500,000 for domestic carriers and these limits have their parallel, not exact, in the Convention regimes in Article 22 where it is 260,000 special drawing rights.

Section 32 is an important part of the Warsaw regime. It repeats Article 23 of the Conventions by excluding any ability on the part of a carrier to contract out. That was part of what we refer to as a deal that was struck by the negotiating parties in the Convention regime.

KIRBY J: Has the Warsaw Convention been amended to provide something different to the equivalent in gold that originally was provided?

MR MARGO: It is under the International Monetary Agreements Act, your Honour, and I do not know, but certainly it is special drawing rights now.

KIRBY J: Yes, thank you.

MR MARGO: It used to be.....francs.

KIRBY J: Yes, that is right.

MR MARGO: “Limitation of actions”, this is the section at the centre of these appeals in the appellant’s contention, which governs answers to all the issues raised by the appeal:

The right of a person to damages under this Part is extinguished if an action is not brought by him or for his benefit within two years after the date of arrival of the aircraft at the destination –

We do not need to consider the variance. There is no issue about when the two-year period expired in either of these cases. And this mirrors Article 29 in each of the Conventions.

“Liability in respect of death”, which is engaged by the Agtrack appeal, this had a parallel, your Honours will recall, in Part II in section 12, and it gives relatives, in this case the widow of the deceased, Mr Hatfield, a right to claim for his death of the same right as passes through section 28 as he would have had if he had been injured, the same kind of liability. And 35(2) is the exclusionary section for dependant claims:

the liability under this Part –

that is Part IV –

is in substitution for any liability –

any other kind of civil liability whatever. So the Act both gives a right, in our submission, and takes away all other rights. Then section 36 is the exclusionary provision in respect of injury which applies in the Air Link case.

KIRBY J: That last statement indicates that when you received the statement of claim you could not have been in doubt as to the fact that the only right that was being sued for was the right arising out of the injury – death as a result of the air – the use of the aircraft and, therefore, by law in Australia you would not have been in any doubt that, therefore, the claim was in respect of that for which only Australian law provided.

MR MARGO: That is not, with respect, entirely correct, your Honour. The defence shows in each of these appeals that the defendant was aware that a claim was intended to be made under Part IV, and I do not contest that, but there are difficulties and ambiguities in the pleadings which I hope, in the brief time that has been allotted to me, to take your Honours to which lead me to qualify your Honour’s proposition. If we did not have a licence under the Act and did not fall under federal carriage in some way or another, or under State carriage, we could have, at most, been liable in negligence or contract if we were an unlicensed operator intrastate or interstate.

KIRBY J: But you knew you were licensed.

MR MARGO: We did. Your Honour, I have to address squarely what relevance the knowledge of the defendant has in judging the adequacy of the statement of claim. I can tell your Honour now - - -

KIRBY J: Do not go off your course. I was just making a little comment.

MR MARGO: I was on 36. Section 37 is not material but it is paralleled by section 14 in Part II. “Proceeds of insurance policies” is also not material for the present purpose, except that it is paralleled in Part II, so is 39, “contributory negligence” paralleled in Part II.

Now, Part IIIC, if your Honours would go to the end of the reprint on page 73. This contains sections in Part IIIC which only came into operation on 22 June 1998. That is between the two accidents and the only purpose of taking your Honours to these sections is that when the Commonwealth extended the regime, the Montreal 4 regime, applied it in Australia, it did so - your Honours will see section 25L, it incorporated by reference provisions of Part IV.

So far from regarding Part IV as a stand-alone kind of domestic section, as the courts below seem to view it, it is our submission that the structure of the Act shows that the Commonwealth intended to apply as a single regime throughout all air traffic, subject to its constitutional competence, the Warsaw regime – the features of which I have identified.

Now, your Honours have a bundle in front of you, five documents which I am referring to in submission, which we distributed this morning. Document 1 is a subsequent amendment to the reprint but it introduced Part IVA of the Act which provided - your Honours do not need to consider the detail, but it applied requirements for insurance to all air carriage in every part of the rest of the Act. So Part IV, II, III, IIIC are all treated the same. Of course, there are some variations necessitated by foreign insurers and the like, but it is one regime, one insurance regime, just another knitting together the legislative feature of the Act and the regime.

KIRBY J: That was done under the insurance power, was it?

MR MARGO: It must have been. I am not sure if it could also have been done under a foreign – I am not sure. If there is any doubt still after that review of the structure of the Act as to the intention of the legislature, may I take your Honours to the second reading speech. Do your Honours have those pages of Hansard of 7 April 1959, pages 903 to 908. It is in the House of Representatives on 7 April, Hansard. The Minister for Defence, Mr Townley:

This Bill has three main purposes –

I am on page 903 – and in the second column, after tracking the international, the parts applying versions of the Convention – this is in the second half of the first paragraph, top of the second column:

Finally, Part IV, extends the principles of the amended convention to all domestic carriage by air within Federal competence but with certain modifications which are considered more appropriate for domestic purposes –

those modifications, your Honours, strengthened the Warsaw regime. The international regime is one of presumed liability and an airline could prove that it had taken all reasonable steps to escape liability, and the quantum limit on damages in the international regime could also be broken if it were proved that the airline had been guilty of misconduct of some kind, and there was a big argument internationally about what that was.

The Commonwealth took both those qualifications out of Part IV. So Part IV imposes on my clients strict liability – if they are brought within it – with no excuses, and the limit on damages cannot be broken even if it is proved that there was misconduct on the part of the carrier, a matter which was never successfully proved internationally anyway – I should not say “never” but rarely. Continuing, the Minister on the second column on page 903 discussed the regime, referred to the fact that 46 countries have now become party to this attempt to introduce some uniform rules, certainly uniform rules regarding liability. It is now 151 countries, according to the website referred to in our submissions, and it represents, your Honours, the most successful attempt to introduce uniformity and private law by treaty that those representing the appellants have been able to discover. On page 904 there is a reference about point 3 in the first column to the fact that the Commonwealth saw it as:

more convenient to have all aspects of carriers’ liability grouped together in a single act.

In the second column on that page begins a discussion of the modifications in Part IV.

On the next page, 905, is a further discussion of the modifications, at the bottom of the first block of print in the first column:

In giving the convention the force of law with respect to international carriage it is, of course, necessary to adopt all its provisions. However, when adapting the convention rules to domestic carriage, we are fortunately free to discard provisions based on this type of compromise between different legal systems -

That was a compromise between civil systems and common law systems and between no-fault systems and systems which really insisted on retaining some element of fault.

At the bottom of the page in the first column:

Part IV of the bill will apply the international rules, with certain modifications to domestic airline operators -

the Minister referred to domestic airline operators but I have already told your Honours that, in fact, applies also to any residual international traffic not covered by another part –

except when they are engaged in purely intra-state carriage, which is, of course, a matter for the States.

The Minister referred in the second column to the fact that domestic airlines were presently free to contract out. That was going to be taken away from them as part of the Part IV regime. At the bottom of the page, the beginning of the last paragraph:

The most important objective in applying the principles of the convention to domestic aviation is to deprive the domestic carriers of their present right to contract out -

On the next page commencing with the second paragraph:

Part IV of the bill, in applying the convention rules -

and it then refers to the two modifications I have just told your Honours about. And then if we go to the last page, 908, in the first column, the Parliament referred to the desirability - the Minister did:

to have uniform rules applying to all classes of domestic carriage especially as the one aircraft may frequently carry passengers in the course of intra-state and interstate journeys.

He then referred to the hope that uniformity might extend as far as intrastate carriage by one of three methods that are canvassed there. Eventually the method adopted was parallel legislation by the States but they were in the New South Wales case the only one relevant to these appeals. It was not until 1967 that New South Wales picked up Part IV of the Commonwealth Act. Then it is considered, in the middle of column 908 - - -

GUMMOW J: And when New South Wales picked up Part IV, did it pick up the limitation provisions?

MR MARGO: Yes, and Proctor v Jetway Aviation is a case where the New South Wales Court of Appeal held – and your Honour is nodding and recalls the case – that the amending rules could be applied if it was a purely State matter to relate back and overcome section 45 in the State Acts. In the middle of column 1, 908:

It is considered that the proposed legislation will ensure a fair balance between the interests of the carrier and the interests of the users of air transport. It will take away the common law right of the carrier to contract out of liability and make him liable in accordance with rules which are substantially more severe than rules applying to any other form of transport.

May I take your Honours then to Articles 28 and 29. A convenient place is at page 26 of the reprint. Article 28 is relevant because of its second leg. Do your Honours have page 26? Article 28 is the jurisdictional article, which forums a plaintiff may sue in, and it has been held to be an exclusive code as to that matter, and it uses words relevant to these appeals in the first line:

An action for damages must be brought, at the option of the plaintiff . . .

(2) Questions of procedure shall -

that is a mandatory provision -

be governed by the law of the Court seised of the case.

GLEESON CJ: I am sorry, which article is this?

MR MARGO: Article 28, page 26 of the reprint at the bottom of the page, your Honour.

GLEESON CJ: Well, I suppose unless you looked at the law of the courts seised of the case, you would not know what is involved in bringing an action.

MR MARGO: Precisely, that is our submission, your Honours, and to speak of an action independently of the rules that say how it is to be brought is, with respect to submissions to the contrary, meaningless. We put the submission as strongly as that. Could I take your Honours then to Article 29 because they need to be considered together. Article 29 is what is sought to be reflected in Article 34 in Part IV:

The right to damages shall be extinguished –

that is the word repeated in section 34 –

if an action is not brought within two years, reckoned from . . .

2. The method of calculating the period of limitation shall be determined by the law of the Court seised of the case.

So we have two references to the forum court. The first is how an action is to be brought under 28.2 and the second is how the limitation period is to be calculated. The courts below inferred from these provisions to the extent that they considered the Convention cases, that section 34 had left all questions of procedure entirely to the forum court.

It is our submission that they erred in drawing that inference. What is left to the forum court is how an action is to be brought, but subject to the command of the statute that it be brought within the two-year period and there are cases which I will take your Honour to briefly now saying that Article 29.2 is likewise strictly confined to calculation of the period. Do you count Saturdays and Sundays, do you count the first day and the last day, limited matters of that kind. May I take your Honours first to the case of Milor.

GUMMOW J: What will this show, Mr Margo?

MR MARGO: This will show that 28.2 cannot be used to import procedural laws of the forum which run contrary to a positive command of the statute.

GUMMOW J: In other words, 28.2 cannot control 29.1.

MR MARGO: Exactly, and an example is given in the Court of Appeal.

GUMMOW J: I would not have thought you needed a case for that.

MR MARGO: One would think not, your Honours, but Justice Ormiston in the court below felt that the national courts in other countries have paid insufficient attention to 28.2, and although he accepted the binding nature of the interpretation for purposes of Part II and Timeny and the like, he felt that Part IV was not a convention carriage section and, therefore, he did not need to follow them. That is why I take your Honours to this. At page 703 - - -

GUMMOW J: It is [1996] QB 702.

MR MARGO: I am sorry, I did not give the reference. Yes, [1996] QB 702 at 707 in the English Court of Appeal, your Honour, Lord Justice Phillips at C:

If I am correct in –

The question here was whether the forum non conveniens doctrine, the Spiliada-type doctrine could be used, a plaintiff having commenced under 28.1 to have the matter stayed so that he had to go to another forum -

If I am correct in concluding that article 28(1) of the Convention provides that the plaintiff shall have the option of choosing in which jurisdiction his claim shall be resolved, is that right qualified where the procedural law of his chosen forum permits the court to decline jurisdiction in favour of an alternative competent forum . . . In my judgment, that general provision cannot give validity to a rule of procedure of the court seised of the case that is in conflict with an express provision of the Convention. By way of example, if the procedural law of the chosen forum imposed a 12-month limitation period, it does not seem to me that this could displace the two-year period of limitation laid down by article 29 of the Convention.

If your Honours go to the end of the report:

The Appeal Committee of the House of Lords (Lord Goff of Chieveley, Lord Slynn of Hadley and Lord Nicholls of Birkenhead) dismissed a petition by the defendants for leave to appeal –

and that proposition is accepted in Shawcross and Beaumont and other texts as representing the accepted wisdom on 28(2).

Now, turning to 29, the other national courts that have considered this section have held it strictly confined that extinguishment is very – sorry, the two-year period is to be strictly enforced and they have approached the matter in two steps. The first step is the finding that the time condition is a condition precedent for an integer of the right conferred by the Convention regime.

Now, the terminology of “condition precedent” could be misleading. The sense in which it is used is one with which your Honours will be familiar from other cases such as David Grant, but in Austral Pacific Group Ltd v Airservices Australia [2000] HCA 39; 203 CLR 136 at 148 paragraph 32 your Honours, Chief Justice Gleeson, Justice Gummow and Justice Hayne, drew a distinction that may be relevant when we come to the rules between a;

condition precedent or necessary antecedent step to the maintenance of an action or the issue of initiating process –

which David Grant had held was the case for the time condition in that case. I am sorry, I should read from the beginning of the paragraph; I chopped off the relevant bit:

However, the election required by s 45 of the Compensation Act is more than the giving of a notice which is a condition precedent or necessary antecedent step to the maintenance of an action . . . As indicated earlier in these reasons, s 44 is a provision going, to adapt the words of Dixon J in Harding v Lithgow Corporation “to the validity of the title to enforce the liability” not merely “to the mode of enforcing it, or the fulfilment of a preliminary procedural condition”.

If our submission is accepted that section 34 time limit bears that character, it cannot be cured by provisions that allow defects and the like to be cured, general provisions of that kind, just as the breach of the provision in David Grant could not be cured by a provision in the Corporations Act alone for curing of defects, nor could it be waived, nor arguably would it be necessary, subject to the view one takes of the rules, for a defendant to plead it. It is a jurisdictional element. If it is not satisfied the court has no right to grant the remedy claimed.

HAYNE J: And what is “it” in the statements you have just made?

MR MARGO: That an actual action be brought within the two-year period. I need to make that further good, your Honour, by taking your Honours to some further cases. So the first step is to give it that characterisation. If I could take your Honours to an extract we provided you with from Professor Dr Giemulla and Dr Schmid in their text on the Warsaw Convention - your Honours have that document. It is some pages only. It is only the common – it gives the French text of Articles 28 and 29 and it is followed by commentary in Article 29.

The French text of Article 29(1) uses the phrase “sous peine de déchéance”. The commentary at paragraph 14 says:

It is disputed whether Article 29 contains a statutory of limitations or a condition precedent.

In the case of a condition precedent –

here meaning an integer of the right –

(délai prefix) the right is extinguished after the time has elapsed. Bringing an action, a plaintiff can avoid losing his claim. The judge is obliged to check whether the claim has expired. Parties cannot waive the expiration of the time limit . . .

In the case of a statute of limitations (‘délai de prescription’) the claim remains in existence even if the time limit has expired.

However, it can be waived. “the defendant must object” or be taken to have waived. Then at paragraph 15, “The original French text of the Convention” uses the phrase:

délai . . . sous peine de déchéance. ‘Déchéance’ should be translated as ‘extinction’. The German translation uses the word ‘Ausschlussfrist’; the English translation the term ‘the right shall be extinguished’ is used. The wording is clear . . . A plaintiff will lose the rights to damages against the carrier if the time-limit of Article 29 expires.

This notion is supported by the fact that French law uses the term ‘déchéance’ for a condition precedent –

The Cour de Cassation, I should tell your Honours, notwithstanding that it is a term of art in French law, according to these authors, have decided alone of all the major national courts that is a limitation period, it just bars the remedy.

They stand alone and against their own regional Cour d’Appel and against the majority of academic writers in France. They have been followed by the Supreme Court of.....which is referred to in - - -

KIRBY J: Have there been any decisions of the German Courts on Ausschlussfrist?

MR MARGO: Your Honour, I approach the matter by taking you to some English cases and then to a text which has reviewed them all which says that they – I cannot recall the German - they are either yes or no to the same effect, but it is in the Commonwealth’s submissions as well. So I cannot take your Honours to specific German text, but I make this submission on the basis of the cases I have looked at in common law jurisdictions, and on the basis of the text that the dominant position adopted by national courts that have considered the matter is that section 29.2, “extinguishment” has a very strict meaning. You have to bring the action within the two-year period, and you cannot have resort to the local law for any purpose that would have the effect in substance of extending the period, but I will come to that in more detail.

KIRBY J: And not as bundled up in the action?

MR MARGO: Yes. The first step is that it is an integer of the right to damages that is conferred by the Convention.

GLEESON CJ: Why does this matter? We are concerned with section 34 of the Commonwealth Act which uses the word “extinguished”.

MR MARGO: The court below, your Honour, in New South Wales accepted that “extinguished” had a strong meaning, but the reason I - - -

GUMMOW J: It is used in the New South Wales current Limitation Act, is not it, to mean just that?

MR MARGO: We submit that is a different sort of extinguishment. It is a provisional kind of the kind this Court considered in Hewett. It is extinguished subject to the possibility of revival by the same statute, whereas in this case there is no mechanism for revival. The reason your Honour the Chief Justice asked me why we need to even look at the Convention cases is that it is from the Convention cases we get the restriction that we submit must be placed on the extent to which local forum law can be used in relation to a provision like section 34.

HAYNE J: By what process do we do that, by a process of construing section 34?

MR MARGO: Construing section 34 in the same way - - -

HAYNE J: What is the construction you urge?

MR MARGO: We urge the same construction as has been adopted by national courts in respect of Article 29 and has been adopted by the only Australian court that has considered the matter in respect of Part II of the Act. That the interpretation of Article 29(2), and therefore we say of 34, is that its reference to the lex fori – read with that 28(2) as well – is intended to have a strictly limited effect confined to how the period of two years is calculated, that is, whether a year means 12 calendar months or 365 days or whether parts of days are disregarded, and the determination of whether the plaintiff had within the two-year period taken the necessary measures to bring the action.

HAYNE J: That does not seem to be a submission about the construction of section 34. It seems to be a submission about the construction of the articles. What is the submission you make about construction of section 34?

MR MARGO: That it should be construed, your Honour, in the same way as the Convention articles are construed, and as they are applied by the statute in all other parts. It was accepted in the courts below, your Honour Justice Hayne, that – it was certainly accepted in Agtrack that the Convention cases have the effect that I am submitting, and that one would interpret Part II of the Act in the same way as the Convention cases.

GUMMOW J: Look, you are not in the Court of Appeal any more Mr Margo.

MR MARGO: No, but the - - -

GUMMOW J: Now, is there any counterpart of Article 28 in Part IV?

MR MARGO: There is not, your Honour, and one would not expect there to be one.

GUMMOW J: Well, why are we fussed about it?

MR MARGO: Because there is no question about how an action is to be commenced within Australia, it is always under the rules of the court seised of the matter. May I take your Honours to - - -

GUMMOW J: Just a minute. So 34 is the limitation. This is a matter arising under federal law, right?

MR MARGO: It is.

GUMMOW J: Now, where is the conferral, if there is one, expressly of any jurisdiction under Part IV?

MR MARGO: I think it has come through 39(2)(b), (1)(c). It is not in the Act. The Judiciary Act, I am sorry, your Honour.

GLEESON CJ: So that if in Australia a person lost some baggage and claimed a couple of hundred dollars damages and brought the claim in the Small Debts Court, the way you would determine whether and when an action was brought within the meaning of section 34 of the Commonwealth Act would be what, by looking at the rules of the Small Debts Court.

MR MARGO: Yes, your Honour, if the court had jurisdiction, yes. It depends - - -

GLEESON CJ: I just picked an example of someone who suffered a couple of hundred dollars worth of damage because the bags got lost.

MR MARGO: Yes, I am sorry, your Honour. But if they were travelling from New York to the place where they lost the baggage and back to New York, a different Convention might apply. That is all I sought to – yes. The court seised of the matter, the rules of that court. And if the court simply said - - -

GUMMOW J: Wait a minute. It is a court exercising federal jurisdiction. The only courts that seem to be candidates are State courts at the moment. Is that right?

MR MARGO: Yes, your Honour. And the procedural rules regarding commencement of actions of the State courts seised of the matter would apply, subject to - - -

GUMMOW J: Would apply why?

MR MARGO: Because they are picked up by either – the procedural laws will be picked up by section 79, your Honour.

GUMMOW J: Exactly.

MR MARGO: And the Commonwealth Act would not otherwise provide, because section 34 and the Convention regime does confide to the forum court how an action is to be brought within the two-year period. I do wish if your Honours will hear me to take you to the cases of Kahn and Fishman briefly because the second very strong step in the Convention cases which has been accepted as applying to international carriage under this Act is to look at the travaux preparatoire for the Warsaw Convention, which specifically considered and excluded any resort to the forum law that would result in fact dependent interruptions or extensions of the two-year period of indefinite period.

GLEESON CJ: I am just going to ask you a question I think you may have been asked already. These arguments you are putting to us are addressed to a question of construction of section 34.

MR MARGO: They are, your Honour.

GLEESON CJ: And you are giving us the answer to the question.

MR MARGO: I am endeavouring to, your Honour.

GLEESON CJ: What is the question?

MR MARGO: The question is, can the local forum courts rules of procedure, when determining whether or not an action has been brought - - -

GUMMOW J: Where do you get this “forum court” business? You are talking about State court, right?

MR MARGO: I am talking about State court exercising federal jurisdiction.

GUMMOW J: Yes, okay.

MR MARGO: I apologise.

GUMMOW J: Unless you start in the right spot, we are just looking through the wrong end of the telescope.

MR MARGO: Absolutely. Whether the procedural law that is picked up by section 79 when a State court is exercising federal jurisdiction in claim under this Act picks up amendment rules which allow an amendment after the expiry of the two-year period, which has resulted in extinguishment of the cause of action to relate back to within the two-year period so that it is deemed never to have been brought within the two-year period.

GLEESON CJ: That is the question in the case. What is the question of construction of section 34? What are the words of section 34 which are of doubtful meaning?

MR MARGO: “Action brought”, your Honour, has an action been brought, and the construction I am contending for that that means has an action been actually brought within the two-year period, and that as a matter of construction one cannot use any laws that deem it to have been brought within a two-year period, so it is a strong meaning. The other word is “extinguished”, that as a matter of construction we submit extinguished once it has actually occurred means, in the words of Timeny, dead and gone forever, cannot be revived in the way that, for example, an extinguishment under section 63, or whatever it is, of the Limitation Act (NSW) might be revived by another provision of that Act. I hope I have answered.

May I take your Honours to Kahn 82 AD 2d 696 which is a case that has been followed consistently. I will try and be as brief as I can. In that case there was a four-judge bench of an appellate division of the Supreme Court of New York. We have a Lexis print, I am not sure what your Honours are - it was a unanimous decision of four judges’ opinion delivered by Justice Gulotta and the first finding, at page 3, second column, his Honour quotes Article 29 of the Convention and then he refers to the distinction in New York law between conditions precedent and statutes of limitation and then there is a long discussion of the confusion that prevailed for some time in the United States as to whether the treaty applied directly or whether the right for damages was given by - whether the Convention created a cause of action or not. I am sorry, that was the issue.

GUMMOW J: There has been a taking of the common law rights.

MR MARGO: And it was a result in favour of the Convention creating a cause of action.

KIRBY J: That is because of the different view that is taken in the United States about the dualistic theory of Conventions in domestic law possibly deriving from the fact that they have to go through the Senate.

MR MARGO: But then at page 6, top of the second column, their Honours said all the courts below really have not – they have been troubled with this question of condition precedent or not and the like, but really, we are dealing with a treaty, and we should go to the treaty itself, and we are entitled to and should look at the proceedings underlying the Convention. At the bottom of page 6, column 2:

The Warsaw Convention was the result of two international conferences -

He refers to a preliminary draft for Article 28 which later became Article 29, and then.....in a way that has been accepted by all subsequent courts that have considered the travaux. The discussion, through the different delegates, at the bottom of column 1 on page 7, the French delegate pointed out:

that it was still necessary to indicate -

how it was that –

the law of the forum which would determine how, within the period of two years, the court would become seized of the action, since the manner in which law suits are commenced varies according to nation.

The Italian delegation, in the middle of column 1 on page 7, were concerned that this would introduce a lot of fact dependent or too much variation according to national court rules, and they wanted –

after two years any action dies and is no longer admissible –

That is the English translation. The Italian wording was eventually accepted. At the bottom of the second column on page 7:

Based upon the foregoing, it is abundantly clear that the delegates to the Warsaw Convention expressly desired to remove those actions governed by the Convention from the uncertainty which would attach were they to be subjected to the various tolling provisions of the laws of the member states . . . Moreover, it is equally clear from the delegates’ discussion that the only matter to be referred to the forum court by paragraph 2 of the present article 29 was the determination of whether the plaintiff had taken the necessary measures within the two-year period to invoke that particular court’s jurisdiction over the action.

Kahn was accepted by the Second Circuit, US Court of Appeals in Fishman v Delta Air Lines – I will not take your Honours to that case, but it has been accepted by that court. It was approved by the Court of Appeal in British Columbia in Gal v Northern Mountain Helicopters. It was accepted by the Full Court of South Australia in Timeny [1991] SASC 2961; 56 SASR 287 – a Full Court decision which concerned an application for extension of time to bring an action under Part IV.

GUMMOW J: Is that a Part IV case, the South Australian case?

MR MARGO: No, it was a Part II case, your Honour. Then, your Honours, Shawcross & Beaumont, 2003 but with 2004 updates inserted, at section VII, paragraphs [447] to [461]. Do your Honours have that? If I could start at VII, 417, third paragraph from the bottom:

If the right of action is ‘extinguished’, it would seem that it is completely destroyed and not merely rendered unenforceable by action. It follows that it cannot be relied upon by way of defence to an action brought by the carrier.

Then it refers to Timeny. If your Honours go to the next page and to footnote 13, Proctor v Jetway, at first instance, Justice Cross was severely rebuked by the Court of Appeal in New South Wales for doing so, had held that they were dead and gone forever. Staples in Queensland had held that on a – I think it was about an addition of a party. Timeny was an extension of time to bring the action under the State Limitation Act. Then there is a sentence at the end of footnote 13:

In some of the Australian States, developments in the law as to limitation of actions may produce a different outcome -

and there is a reference to the decision of the primary judge in Agtrack. So the divergence was immediately noted in this well-recognised international text. If you could go then, your Honours, please, to page 431 - - -

KIRBY J: I remember the discussion in the special leave hearing about this paragraph. It does not seem to be a critical statement by the authors of the text.

MR MARGO: Not critical, your Honour, certainly not critical, but noting a divergence from a position that had been accepted as well established by another line of cases.

KIRBY J: You overstated the proposition a little in the special leave hearing. I think you rather suggested that this took Australia out of line with the international - - -

MR MARGO: We do make that submission, your Honour. If I overstated the footnote, I apologise. We make the submission that if this line of using local laws to have amendments relating back so that you can actually in effect bring an action four years after an accident or three and a half or whatever the facts happen to be, would be a divergence from the accepted position by most national courts. We say that section 34 should be so interpreted.

GLEESON CJ: There is an anterior question that needs to be resolved in these cases, and that is just what you have to do to bring an action.

MR MARGO: Yes, your Honour. I hope to come to that in the time allowed to me. At the bottom of page 420-430, under the heading “Changes of party”:

It has been held in the United States that it is impossible to add a further plaintiff once the two-year period prescribed in art 29(1) has expired. In New South Wales the Supreme Court Rules allow the additional of a new cause of action with the leave of the court despite the expiry of a limitation period –

that is McGee v Yeomans referred to –

this has been held applicable in a carriage by air case governed by the Civil Aviation (Carriers’ Liability) Act 1967 (NSW) which applies to domestic flights a provision identical to art 29(1) –

that is Proctor v Jetway in the New South Wales Court of Appeal –

but the court emphasised the wholly domestic and non-international nature of the case, which suggests that a different view might have been taken had the Warsaw Convention rules been directly applicable.

It was really Justice Priestley in that case who made the strongest statement. I do not ask your Honours to go to it now, but I can read it to your Honours.

KIRBY J: But how in principle can you have a different interpretation?

MR MARGO: You can have a different interpretation because this is wholly within State jurisdiction. It is undesirable there should be one, and we invite your Honours in our submissions in reply, if you accept our construction of section 34 for the Commonwealth Act, formally to overrule Proctor v Jetway.

GLEESON CJ: How could the Warsaw Convention rules ever be directly applicable in Australia?

MR MARGO: It could not, your Honour. We do not submit that at all. It is accepted construction that if the Commonwealth intends to give effect by national legislation to treaty obligations, that the Court will look to how the treaty has been interpreted by the treaty parties. That is the strongest submission we put. So we have to make a bridge between Part IV and all the other parts and then we have to take the step I have just referred to. It is not direct application of a treaty, but your Honours have done this in other cases, refugee treaties and the like. Your Honours have looked to what the treaty parties thought in construing legislation seeking to give effect to a treaty obligation as a part of national law.

KIRBY J: I am just curious in your answer to my question. If the source is section 34 and it is the one text, how could one give it a different application for intrastate or purely State application from international application?

MR MARGO: As a matter of constitutional power perhaps one could have differently - they could not both be right, your Honour.

KIRBY J: I just do not see how the same text can be given a different interpretation.

MR MARGO: They could not both be right.

GUMMOW J: It is really a question of construction of section 5 of the Civil Aviation (Carriers’ Liability) Act 1967 (NSW), is it not? Section 5 says - - -

MR MARGO: I do not have that in front of me - - -

GUMMOW J: Section 5 says:

The provisions of Parts IV . . . incorporated in this Act - - -

MR MARGO: There would be a straight conflict. If our submissions were accepted on section 34 of the Commonwealth Act, there would be a straight conflict with Proctor v Jetway.

GUMMOW J: The question is how you match then section 5 of the State Act with the Supreme Court Act and the rules made thereunder.

MR MARGO: Yes.

GUMMOW J: That would be the question.

HAYNE J: And the provisions under the Limitation Act (NSW) permitting extension, whether there is pro tanto qualification or not - separate question.

GUMMOW J: Yes.

MR MARGO: Well, in our submission, if section 34 of Part IV is construed in accordance with section - - -

GUMMOW J: The Limitation Act 1969 (NSW) postdates the 1967 State Act, I suppose.

MR MARGO: It does.

GUMMOW J: We do not have to get into all that.

MR MARGO: Your Honours, in Proctor v Jetway, Justice Priestley observed that Mr Justice Cross and a primary judge had been very influenced by the Convention cases, but it was Justice Priestley who said in Proctor, “But we don’t have to be concerned with the Convention cases because this is a matter wholly within the law of the State, and we are applying a State rule to a State Act”.

And section 6 of the Supreme Court Act 1973 which brought in the new rules as Schedule 4, I think it was, had said that to the extent there was any inconsistency between the new rules, and they included this amendment rule, they could relate back and abrogate Weldon v Neal and any earlier Act that the rules would prevail. The District Court Rules engaged in Air Link have, in our submission, no equivalent statutory backing.

GUMMOW J: Where do we find the actual provision in Proctor that gave this supreme force, as it were, to the - - -

MR MARGO: I am sorry your Honour, I did not hear.

GUMMOW J: Where do we find the provision set out in Proctor which gave predominant effect to the Supreme Court Act?

MR MARGO: You do not have it, your Honours, but you should have a copy of section 6 of the Supreme Court Act which is on our list. The Supreme Court procedure – I am sorry, it is quoted in Proctor at page 171A, your Honour.

GUMMOW J: That is what I asked.

MR MARGO: And I can tell you where the section if - - -

GUMMOW J: Anyhow, the point is section 6 could not have any effect on what otherwise was the operation of section 34 of the federal Act, that is this case, that is your point.

MR MARGO: No.

GLEESON CJ: But you make in passing a rather alarming suggestion that there might be a different result as between the Supreme Court of New South Wales and the District Court of New South Wales in a purely State matter, depending on the court in which you commenced your action.

MR MARGO: The submission there is that one needs primary statutory backing before a power to make procedural rules can affect substantive limitation periods.

GLEESON CJ: You may be absolutely right about that - - -

MR MARGO: It would be startling.

GLEESON CJ: But it would add a new peril for solicitors starting actions in New South Wales.

MR MARGO: Easily cured, your Honour. The legislature is only to say the word and it is cured.

GUMMOW J: So there is no equivalent of section 6 in the current version of the District Court Act, is that right?

MR MARGO: No.

KIRBY J: Mr Jackson says that special leave was refused in Proctor v Jetway, is that correct?

MR MARGO: It was, your Honour. It was refused on the ground that the State court was talking about its own rules. I do not know to what extent the Convention cases were drawn to the attention – but certainly Mr Justice Cross had argued the Convention cases in – the primary judge considered them, but the Supreme Court took the view it was a matter entirely of its application of its own rules to a State Act.

KIRBY J: Do we have to overrule Proctor v Jetway to accept your argument?

MR MARGO: You do not have to, your Honours, but it would be convenient to do so.

HAYNE J: I am sure it would.

KIRBY J: Convenient to you, but is it necessary to your argument that the logic of Proctor v Jetway is wrong?

MR MARGO: No. No it is not, your Honour. We did invite the Court of Appeal in Air Link to overrule Proctor.

KIRBY J: Yes, I saw that.

MR MARGO: Justice Ipp thought we had done it late, but we did it within our notice of appeal. But it is not necessary; it can be distinguished, but it would have the illogical result that your Honour Justice Kirby has drawn attention to. That is the sense in which I meant convenient and undesirable; it was not thinking of my clients. It is just that passengers - their rights would vary depending on their ticket. They could be on the same flight, same accident, same point of departure for that leg and same arrival and still get a different result.

Shawcross & Beaumont, having regard to the time allotted me, the Commonwealth submissions track Shawcross & Beaumont. The conclusion is that the English courts would refuse an amendment granted outside the two-year period that related back to enable the action to be brought, but the United States courts would do the same. Fifteen other countries have accepted the dominant interpretation, and in Australia the Full Court of South Australia has accepted it.

Now, your Honours, Justice Mason in the New South Wales Court of Appeal said even if the Convention cases should – you should have regard to them, and he was not convinced he should, but if he should have regard to them in interpreting section 34 of Part IV he still sought to distinguish them as dealing with substantive local laws like tolling, bankruptcy, extension of time as in Timeny, and said that amendment in effect relating back was a procedural matter not touched by the Convention cases.

HAYNE J: Well, that turns upon what your submission is about the meaning of the words “action is not brought” in section 34.

MR MARGO: Yes, your Honour.

HAYNE J: At some point in your submission I would be interested to know what you say the words “action is brought”, or the negative “action is not brought” means.

MR MARGO: Certainly, your Honour, and we must come to that.

KIRBY J: I assume that the English cases that you refer to relate to a statute of the United Kingdom Parliament?

MR MARGO: Yes. I forget its full title, Carriage by Air Regulation or whatever it is, that applies.

CALLINAN J: Mr Margo, could I ask you to look at page 3 of the application book, paragraph 8.

MR MARGO: Which application, please, your Honour?

CALLINAN J: In Paterson (No 2).

MR MARGO: Page 3 of the appeal book, your Honour?

CALLINAN J: Yes, paragraph 8. Could not that be characterised as a claim under the Commonwealth Act?

MR MARGO: Your Honour, we did not issue that ticket, Qantas Airways did. We, as defendant, have no idea what the legs of that ticket are without inquiry. We asked for particulars in this case. It was only after receiving particulars that we repeated them in our defence.

CALLINAN J: But objectively, leaving aside questions of knowledge, why cannot that comprehend a claim under the Commonwealth Act?

MR MARGO: There is also the question of licence, what is pleaded in paragraph 2 and in - - -

CALLINAN J: And in paragraph 3, I know that.

MR MARGO: It is purely intrastate traffic and a licence which is only required for intrastate operations.

CALLINAN J: I understand that.

MR MARGO: Then we refer to a ticket which we know nothing more about from this pleading.

CALLINAN J: You can get particulars of the ticket and you sought particulars, did you not?

MR MARGO: We sought particulars straight away.

CALLINAN J: Do not worry about 2 and 3 for the moment. Do you agree that objectively, paragraph 8 is capable of comprehending a claim under the Commonwealth Act?

MR MARGO: I am going to come to the pleadings in some detail. My respectful submission is it is not.

CALLINAN J: Why not?

MR MARGO: Because it does not say if this ticket had commenced in New York and it was a return ticket to New York, it would be a completely different part to Part IV, but could be intrastate if we did not have a licence.

CALLINAN J: Ticket number 4463500449, is that the ticket which covered also interstate travel?

MR MARGO: In fact, it was a ticket for interstate travel from Queensland to New South Wales and back but we did not know that, your Honour.

CALLINAN J: And a request for particulars would have elicited precisely that.

MR MARGO: It did, your Honour, that is in the book.

GLEESON CJ: Mr Margo, 40 years ago in New South Wales in the position – it may still be the same in the Small Debts Court for all I know - in the Supreme Court of New South Wales, when you commenced an action you issued a writ. You later served a declaration which pleaded your cause of action but the action was commenced when you issued the writ and unless it was a specially endorsed writ, as my memory goes, it was a very uninformative document. It identified, as I remember it, the plaintiff and the defendant and announced that the plaintiff was claiming damages from the defendant and usually put in $1 million or something like that. That was bringing the action, was it not?

MR MARGO: It was, your Honour, generally for purpose of the rules. The question in these appeals is: was an action brought under Part IV of the Act? I am not submitting at the moment that it had to say it was brought under Part IV of the Act, although that is desirable under the rules engaged in these appeals. The straight answer to your Honour’s question is if the local rules said that is enough to bring an action under Part IV, so be it. If there were a State of the United States which said, all you have to do is say, “I was travelling on a plane and I’d like damages”, and that that constituted bringing an action for purposes of the Convention, then so be it.

GLEESON CJ: I do not think that 40 years ago in the Supreme Court of New South Wales you would even have had to say, “I was travelling on a plane”. I think you would have served a writ.

MR MARGO: But, with respect, your Honour, even a generally endorsed writ had to contain a statement. The Victorian Rules still allow for a generally endorsed writ. His Honour Justice Hayne is very familiar with those rules, and I am going to come to them. At the back of the bundle I handed up to your Honours this morning is a reference to what we say are the relevant rules in the District Court of New South Wales and in the Supreme Court of Victoria on the last page. The position in the District Court of New South Wales is that you may only commence an action of this kind by statement of claim. There is no alternative, and the position in Victoria is you may commence by a writ endorsed with statement of claim, which is what was done in Agtrack and we stop there and say, well we do not have to look further. Did that writ endorsed by statement of claim bring an action under Part IV or not? But you could - - -

HAYNE J: Well, what do you mean by “bring an action”? At some point, Mr Margo, you have to grapple with that and tell me what you mean.

MR MARGO: Your Honour has made that clear and I will endeavour to satisfy your Honour.

CALLINAN J: Before you do that, Mr Margo, I just need to have the position clear. Could I draw your attention to the fact that paragraph 8 is a pleading in the alternative, so it is put alternatively, and one could construe that as alternatively to other facts alleged, and there is no reason why the respondent cannot put his case upon more than one basis.

MR MARGO: Your Honour, on a fair reading of this document, the alternative that has been introduced is a claim in contract.

CALLINAN J: Yes, claim in contract under a specific ticket which we now are agreed is a ticket for intestate travel.

MR MARGO: Your Honours, it is a claim for breach of contract.

CALLINAN J: Yes.

MR MARGO: And the claim is one for damages in negligence or for breach of contract.

CALLINAN J: The ticket forming part of the contract being a critical part of the contract and the ticket being a ticket for interstate travel.

MR MARGO: In our submission, your Honours, if the defendant had admitted all the facts pleaded in this document, the Court would not have jurisdiction to grant a remedy under Part IV of the Act.

CALLINAN J: Well, they - - -

HAYNE J: And in fact the defendant did admit the ticket, did it not?

MR MARGO: I am sorry?

HAYNE J: The defendant did admit the ticket and admit the interstate carriage - see page 5, paragraph 10.

MR MARGO: Yes, the defendant pleaded the facts which show that Part IV applied and pleaded the exclusory provision of Part IV.

GLEESON CJ: Do we happen to know whether the ticket actually made express reference to the Civil Aviation (Carriers’ Liability) Act?

MR MARGO: I think there is a copy of it in the book, your Honour.

GLEESON CJ: Where would we find it?

MR MARGO: I will ask my junior to find it for me. We as the defendant are not required by the rules to go looking into the particular - - -

GLEESON CJ: No, I just wondered whether the ticket referred to on page 3 that Justice Callinan has referred you to might have actually referred to the statute.

MR MARGO: Page 34, your Honours, but we do not have the condition.

GLEESON CJ: We do not have the whole ticket?

MR MARGO: No. Your Honour, I am conscious of time. If your Honours will permit me to - - -

GLEESON CJ: You are very conscious of it. You keep referring to it. If you were arguing this case in the Supreme Court of the United States you would already have exceeded your time by 100 per cent.

MR MARGO: I apologise.

CALLINAN J: Mr Margo, do the District Court Rules of New South Wales require parties to plead matters of law?

MR MARGO: They do. They require a pleading to state each cause of action that is sought to be brought.

CALLINAN J: Yes.

MR MARGO: And the remedy sought in respect of that cause of action. Could I take your Honours to a - - -

CALLINAN J: And material facts, no doubt.

MR MARGO: Yes.

CALLINAN J: Material facts, remedies and causes of action.

MR MARGO: Yes.

CALLINAN J: Is that right?

MR MARGO: Yes, and the Victorian Rules actually require that the statute and the section of the statute relied on be identified. We do not submit that if that were the only defect in the statements of claim that that might not possibly be curable under a defect-curing provision.

CALLINAN J: Well, I just put you on notice, Mr Margo. For my part, at the moment, I am not persuaded that this was not a claim, that is in paragraph 8), under the Commonwealth Act, a claim in an action duly brought under the Commonwealth Act. At the moment I am not persuaded that that is not so.

MR MARGO: Thank you. Your Honour, one cannot, with respect, just look at little bits of the pleading. One has to do as the Court of Appeal did; consider it as a whole. It is a claim in negligence and for breach of contract. The maximum that could have been awarded against us on that claim if we had not defended it was a judgment for damages in negligence or for breach of contract. That is our submission and it is not permissible to disregard all the parts that deal with negligence and that deal with contract in assessing whether or not as a fair matter an action has been brought under Part IV of the Act. The question is not simply whether an action – any action has been commenced. For Limitation Act purposes, an action is very widely defined. Mere filing of a writ traditionally stopped time running under limitation statutes. The question here is whether or not, as the statute commands, an action has been brought under Part IV.

GLEESON CJ: I would not be completely surprised if the standard form of Qantas ticket issued at the relevant time contained in the terms and conditions on the ticket a reference to the limitation of liability under the Commonwealth legislation. However, I gather from what you say that we do not have before us those standard terms and conditions. All we know is that they were there because the ticket on page 34 refers to them.

MR MARGO: Your Honour, on amendment in relation back under the Convention cases, there is the case of Motorola, which we have given your Honours, which holds squarely that the ratio of all these cases forbidding tolling, granting extension of time and the like, relates to federal – civil rule of procedure on relation back. That was a case about adding a party, but it still stated a general ratio.

There is another single judge decision of the District Court of the Eastern District of Pennsylvania which goes the other way, but the English Court of Appeal in Western Digital – may I take your Honours to that, [2001] QB 733. This was a case under the Guadalajara Convention. The carriage was from Western Digital Singapore to Western Digital in Netherlands but based in the UK, and there were two sets of air waybills.

Western Digital Singapore used a freight forwarder called LEP. The freight forwarder entered into a contract with Qantas under a master air waybill to carry the consignment of computer parts to a freight forwarder in the United Kingdom. So there was a master air waybill. Annexed to the master air waybill but not in evidence before this Court were two house air waybills. The master air waybill named the freight forwarder LEP as consignor, and the freight forwarder in the United Kingdom as consignee. The house air waybills named Western Digital Singapore as consignor, LEP as the contracting party, and Western Digital Netherlands as the consignee.

A claim had been brought within time, though the actual carrier was British Airways. A claim had been brought within time by Western Digital companies and their parent company against British Airways for damage to a consignment, and the contract relied on was the master air waybill. They applied to amend to bring outside the two-year period a claim involving the same plaintiffs, the same defendant, the same actual carrier, the same cargo, the same damage and the same quantum, but relying further on the alternative on the house air waybills, and the court held that the English rules allowing for amendments relating back could not avail. Both claims were under the Convention. At page 741, in the middle of B, Lord Justice Mance:

Liability as an actual carrier under the Guadalajara Convention depends upon the existence of a specific agreement for carriage with a specific contracting carrier . . . The writ (as amended) and the points of claim as originally served rely exclusively upon the Qantas air waybill as evidencing the relevant contract of carriage . . . British Airways is by implication alleged to have performed the carriage by authority of Qantas. The alternative case that LEP itself contracted as principal for carriage by air of the two consignments under the LEP air waybills –

that is the house air waybills –

asserts a new and different contract . . .

14 Mr Crane’s submission is that an action was brought within two years against British Airways as actual carrier, and that all that is now wished is to redefine the basis upon which British Airways were actual carriers -

simply to elaborate another ground arising out of the same facts, but the court held that that involves a different right to damages, and a different cause of action.

Although the introduction by amendment of paragraph 3A would not deprive the defendants of the benefit of any defence to this new claim under Article 29(1) . . . it would still be wrong to permit the introduction of a claim which was clearly extinguished by lapse of time.

The court below in New South Wales distinguished this case on the basis that the English adopt a more restricted approach to their relation back rules than was adopted by the New South Wales Court of Appeal in Proctor.

In our submission, this case is equally explicable and the reasons not here given on the basis that it is a convention case and that you have to treat the two-year time limit as strict. So those are two cases, Motorola and Western Digital, which show that amendment by relation back is within the general ratio of the section 29 cases.

GLEESON CJ: Mr Margo, Mr Cotton of your instructing solicitors’ firm swore an affidavit which is set out on page 30 of the appeal book. I would like to see the whole of annexure B to that affidavit, please.

MR MARGO: I will see if it can be found.

GLEESON CJ: Thank you.

MR MARGO: Your Honour, may I come to Justice Hayne’s question about how an action is brought. It is accepted in both the courts below that the action would be extinguished unless the amending rule relating back was available to treat it as if it had been brought within two years. It was also accepted in both courts that the question of how an action is to be brought depends on the rules of court. Could I take your Honours first to the District Court Rules; they are set out - - -

HAYNE J: Do you say that is right? Do you say that is wrong? What is your submission?

MR MARGO: Our submission is that that is right, your Honour, subject to the restriction that the action must be brought in the way commanded by the rules within the two-year period, actually brought. One cannot have a deemed action by amendment outside the two-year period which relates back to within the two-year period. That is our submission. District Court Act, section 4, defines “proceeding”.

KIRBY J: Your concept of action is it must be an action that is based upon the federal Act and nominates the federal Act specified.

MR MARGO: The rules require it to nominate the federal Act but we would accept that if that were the only defect a court might take a different view.

CALLINAN J: Which rule requires that you nominate the federal Act?

MR MARGO: In the District Court, it is District Court Rule 6A. It does not say nominate the Act, it says identify each cause of action relied on and each form of relief relied on for that cause of action. In the Victorian Supreme Court Acts it says - - -

CALLINAN J: Wait a moment. The causes of action are nominated. They are negligent, causes of action in negligence not breaches of statutory duty; they are causes of action in negligence and contract.

MR MARGO: Yes, and those are identified in the statement of claim in Air Link, your Honour.

KIRBY J: You say they are different in legal kind from a cause of action based upon the Act. Is that what you say?

MR MARGO: Yes.

CALLINAN J: But it is not based upon the Act. The Act determines certain matters but negligence still has to be proved, does it not?

MR MARGO: No, your Honour, strict liability.

CALLINAN J: Well, negligence – no. Contract has to be proved.

MR MARGO: The ticket, yes, your Honour.

CALLINAN J: Yes, the contract.

MR MARGO: No consideration for contract.

KIRBY J: The District Court Rules, Part 9 rule 3 says:

(1) A pleading of a party shall contain, and contain only, a statement in a summary form of the material facts on which he relies, but not the evidence by which those facts are to be proved.

So it needs the declaration of the material facts on which he relies. The District Court of New South Wales does not seem to require the nomination of the statute.

MR MARGO: That rule said, I think, subject to Part 5 your Honour will see, in Part 5 rule 6A, and it has been addressed twice recently by the Court of Appeal in New South Wales, and it is said to be a definite requirement of the District Court Rules.

KIRBY J: Which rule in Part 5?

MR MARGO: Part 5 rule – if your Honour would look first at rule 6:

An action shall be commenced –

that is how it is commenced, and that is read with section 53 of the Act. And then Part 5 rule 6A:

A statement of claim lodged to commence an action –

and that is what happened in Air Link –

shall contain:

(a) a statement of each cause of action in respect of which the action is brought –

and the Court of Appeal has considered that in Air Link (No. 1) and also in the case of Kirby v Sanderson Motors referred to in Air Link (No. 1).

HAYNE J: And has held that those words mean what?

MR MARGO: That Part IV of the Act should have been referred to, but Justice Sheller - - -

HAYNE J: So a statement of each cause of action is to be understood as more than and different from the pleading of - - -

MR MARGO: Of the material facts, your Honour, sorry. I apologise your Honour, I certainly did not mean to interrupt you.

HAYNE J: Go on. You go on.

MR MARGO: Your Honour, the submission is that that particular rule does require a label, which is different from the bundle of material facts giving rise to the cause of action. But these appeals do not turn on a statement of claim in which that was the only defect.

GLEESON CJ: Mr Margo, in the current circumstances, a lot of procedures are commenced by self-represented litigants, and a lot of proceedings commenced in courts are very defective in form. How would you go about, in the case of a proceeding commenced by a self-represented litigant, deciding whether or not an action had been brought within two years?

MR MARGO: It would be very difficult for a self-represented litigant having no knowledge of the law to bring an action under Part IV, as required by the statute.

GLEESON CJ: Even if you are only claiming a couple of hundred dollars for lost baggage?

MR MARGO: Yes, your Honour. My submission is as strong as that, that it is a command of the statute that the action be brought – actually brought within two years. That is part of the package under which we are strictly liable and the like.

KIRBY J: That interpretation of the federal Act, and the provisions in the federal Act, imposes a sense of rigidity that we have tended, in Australia at least, to move away from in procedural rules. The question then becomes whether the Convention, insofar as it is brought into the federal Act, contemplates and permits the sort of relaxation of the rigidity for which you argue.

MR MARGO: Yes.

KIRBY J: But your point is that if you go back to the travaux preparatoire and you go back to the way it has been interpreted in other countries, this is a rigid Convention. In many ways it is an unfair Convention, but it is the Convention that is adopted and is to be given effect throughout the world.

MR MARGO: It is, your Honour.

KIRBY J: It, in a sense, is a relic of an earlier age of procedure.

MR MARGO: Yes, your Honour, it may work unfairness in some cases, but the legislature has decided that the treaty should be applied.

KIRBY J: That is the question, you see, whether we import into it the rigidity that you urge because of the history or whether one would look at the statute, a federal Australian statute, as one would normally do, and try to avoid this rigidity for the sort of reason the Chief Justice has mentioned. It could work a terrible injustice on ordinary citizens who do not have the benefit of expensive lawyers.

MR MARGO: Yes. Our submission, your Honour, is that considerations of fairness such as underlay the rule in Weldon v Neal, are not relevant to construction of the treaty or of provisions seeking to reflect it, and that is - - -

KIRBY J: Well, the words are ambiguous. You say “commence an action”. In a generic sense the plaintiffs have commenced an action, but they just have not nominated and spelt out the cause of action of their action, but they have commenced an action.

MR MARGO: It is not enough to commence an action of any sort. It has to be an action that can be characterised as an action under Part IV within two years; that is the submission.

KIRBY J: Yes, but the pleading does identify the nature of the carriage, the facts leading to the carriage and then the question is - - -

MR MARGO: May I take your Honours - - -

GUMMOW J: The question is have they commenced an action in federal jurisdiction by commencing an action in contract in tort.

MR MARGO: Yes. Well, in our submission – and your Honour knows more about this than I do obviously, but - - -

GUMMOW J: But that is the question, is it not?

MR MARGO: It was not until - - -

GUMMOW J: When it says “bring an action” it means bring an action in federal jurisdiction. It has to.

MR MARGO: Yes, and until we put on our defence in Air Link there was no federal jurisdiction, in our submission, because it could have been that the action was in negligence against an unlicensed carrier.

KIRBY J: But why do you have to nominate the federal element? If you are within federal jurisdiction surely it does not depend on your - - -

MR MARGO: The question is when one becomes within federal jurisdiction. At the time the claim was made in negligence and contract. It is a claim at common law, in State jurisdiction.

GLEESON CJ: Did the Court of Appeal of New South Wales in the earlier litigation in which it decided, following the first Agtrack decision, I think, that this action had not been brought within two years, consider the terms and conditions of the contract referred to on page 3 of the appeal book?

MR MARGO: No, your Honour. May I take your Honour to the decision of that court?

GLEESON CJ: Yes.

MR MARGO: It is at page 53 in the Air Link appeal book with the President, Justice Sheller and Justice Beazley, at paragraph 5 on page 59 – the section is quoted and the proposition is stated with which – it was a unanimous decision:

The action referred to must necessarily be an action under Pt IV.

Then their Honours turn to a careful examination of the statement of claim in Air Link and there is a reference to the ticket in that examination but not its terms. In paragraph 7:

In short, the statement of claim pleaded a claim founded on causes of action for negligence and breach of contract . . . Nothing in the statement of claim suggested that the claim was made under Part IV of the Act for injuries sustained during interstate carriage.

KIRBY J: Is not that mixing up “action” and “cause of action”?

MR MARGO: Even on the wider meaning that is given to “cause of action” for limitation statute purposes, material facts, jurisdictional facts that ought to have been pleaded – we are not talking about a label, a form of action, had not been pleaded. That was the conclusion of the Court of Appeal – ought to have been, had to be to bring the action and had not been.

At page 63, I just draw your Honour’s attention to the fact that there is a careful tracking of every element of this document. At paragraph 13:

In this proposed amended statement of claim no mention was made –

this is the proposed amended statement of claim –

of claims for negligence or breach of contract. The form of the amended statement of claim, in contrast to the original statement of claim filed, pleaded a claim under Part IV –

and then at the top of page 64, their Honours refer to Part 5 Rule 6A, and quoted it. Paragraph 17:

The statement of claim filed by the plaintiff did not comply with this rule . . .

Part 9 of the District Court Rules is directed to pleading and particulars . . .

has effect subject to . . . Part 5.”

Then their Honours refer to an earlier decision on the District Court Rules and what is required - Kirby v Sanderson Motors [2002] NSWCA 44; 54 NSWLR 135 in the Court of Appeal. Here the Court of Appeal granted leave to appeal in the fourth week of a trial because they felt it was so important that what the District Court pleading rules required be settled. They held that it had to state the cause of action in the District Court, and there is a quote from two paragraphs of the judgment of Justice Hodgson who gave the main judgment, but immediately prior to those two quoted paragraphs, Justice Hodgson had said what “material” meant:

(1) “Material” means material to the claim, that is, to the cause or causes of action which are relied on.

(2) The requirement of a statement of material facts does not exclude the allegation of legal categories, such as duty of care, fiduciary duty, trust and contract.

(3) The general requirement to avoid surprise means that material facts must be stated –

and this is the part we rely on –

in such a way that a defendant can understand the materiality of the facts, that is, how they are material to a cause of action.

So his Honour was there saying, quite independently of a rule that requires you to state the cause of action, the obligation to plead material facts requires that the defendant should not have to search through a pleading in negligence and in contract for.....which, if unpacked, might reveal a different cause of action.

GLEESON CJ: That tends to suggest that your submission is that the words of section 34 are related to bringing to the notice of the defendant that the claim is being made under the Commonwealth Act. Is that right?

MR MARGO: No, your Honour, with respect, even if we knew from day one that an accident happened, that there might be 300 people claiming against us, even if we knew when we received a piece of paper that these people were trying to claim under a particular part or on a particular ticket, in our submission, the statute requires something different to what is required for Weldon v Neal or Limitation Act considerations which are based on fairness and the like. It requires that the action be brought within two years.

GUMMOW J: If I can just put this to you, Mr Margo. At some stage you have to look at section 39(2) of the Judiciary Act. You have to look at the terms of section 39(2) Just assume you had an action between two humans – forget about this case – you have an action in tort in the Supreme Court between two humans, one of whom turns out to be resident in one State and one of whom turns out to be resident in another and that fact is not specifically identified. Is the Court, nevertheless, not exercising federal jurisdiction immediately by dint of 39(2) because it is a matter, namely, one which is in fact between residents of different States, in which original jurisdiction could be conferred on this Court.

MR MARGO: Certainly, that view has been expressed by your Honour as well. It could be.

GUMMOW J: That is the relevant area of debate, reading 39(2) with section 34. I know, in your favour, that is not what the Court of Appeal did in the first dealing of the case but maybe they should have and we are looking at it through the wrong end of a telescope, in my view.

CALLINAN J: You have to look at what the objective facts are.

MR MARGO: Yes, your Honour, but the objective - - -

GUMMOW J: Is that not that the argument against you? You have this ticket with these conditions on it and so on and so forth.

MR MARGO: Your Honour, whether the Court has jurisdiction may be a separate question from whether or not the pleading has brought the action. That is a matter under the rules.

HAYNE J: Then does you argument come to this, be it right or wrong? Section 34, action must be commenced. How do you commence an action? You look relevantly to the District Court Rules, Part 5 rules 6 and 6A, perhaps also you look to Part 9 rule 3(1) and you connect those with section 28 of the federal Act and although reference is made in the statement of claim to personal injury, operations of embarking or disembarking, does you argument come to the point that the pleading does not reveal that this part of the federal Act applied to the carriage of the passenger? Is that what your argument comes to?

MR MARGO: Yes, plus, your Honour, that it does not plead what Justice Ormiston referred to as jurisdictional facts, namely the facts which would show that the federal carriage fell under Part IV. The licence and interstate traffic carriage, but these were not simply conditions precedent in a soft sense which could be established by evidence. They are material facts which had to be pleaded in order to bring the statutory cause of action.

At page 65 in the Air Link (No 1) decision Justice Sheller said after reviewing Kirby v Sanderson Motors, he had just read the passage from Justice Hodgson:

The statement –

of claim –

should also convey exactly what relief is claimed in respect of each cause of action.”

If the plaintiff’s right to recover damages for injury depends exclusively upon the provisions of a part or section of a statute it is essential that the claim states material facts demonstrating that entitlement –

demonstrating – we submit you have to plead at least those facts which you would have to put into a stated case under the old law and it is desirable that the statutory provision be identified, so the court did not base its decision solely on Part 5 rule 6A. They might have taken a different view if that were the only defect.

GLEESON CJ: Is there a difference between what is sufficient to bring an action, and what is necessary to comply with the rules of court designed to protect a defendant against surprise?

MR MARGO: In our submission, the rules of court determine how one brings an action. If they say you bring it by filing a statement of claim, that must plead material facts.

GLEESON CJ: They say that now. At the time the Commonwealth Act was enacted the Supreme Court procedure in New South Wales was that you brought an action by serving a writ which contained no other relevant information than the identities of the parties, and a statement of the amount for which the plaintiff was suing the defendant, which, as I said earlier, was usually $1 million, or a good round figure designed to protect the solicitor from an action for negligence.

MR MARGO: Your Honour, if the rules today so provided that would be sufficient to bring an action under section 34. They do not so provide.

GLEESON CJ: Well, you say that. I would not be surprised if somebody told us that the rules of the Small Claims Court provide something like that.

MR MARGO: If the claim were brought in the Small Claims Court and they so provided, we concede that an action would have been brought. If the Small Claims Court said all you have to do if you have a claim under Part IV is file a general writ with or without endorsement of any kind, and the action would have been brought under Part IV, then that would be sufficient. But what these rules say in each case, in the District Court you have to bring a statement of claim and we look at the statement of claim that was brought. In Victoria you may do it by generally endorsed writ or endorsed by statement of claim, and it was done by the latter means, and one looks at what was done and the question then is, was what was done sufficient to bring an action under Part IV, not was it an action within the meaning of limitation statutes, which have these very wide definitions; not, would it be fair to allow the addition of some facts and raising a new cause of action on the new bundle of facts, but was an action brought within two years by the paper that was filed?

The Court of Appeal held in Air Link (No 1) that if you looked at this document you could not fairly say that it had brought any action under Part IV and what Justice Sheller says in the next paragraph, paragraph 21:

a course, in my opinion, impermissible in determining what causes of action the plaintiff relied on –

to ignore the surplusage, the so-called surplusage. All these paragraphs, four, five or six of them, I have not counted – that pleaded negligence and breach of contract that gave meaning to phrases such as Justice Callinan referred to in the alternative cannot just be stripped off in deciding whether the statement of claim has brought an action under section 34. At the top of page 66:

All these allegations were pleaded as facts going to support the causes of action in tort and contract. Their presence is thus explained. The statement of claim as a whole did not plead the statutory cause of action. In my opinion, if the allegations of negligence and breach of contract are ignored, what remains does not plead the statutory cause of action.

It was admitted in both cases that the legal advisers of the plaintiff had no intention of pleading Part IV. They intended to bring actions in contract and tort. We have collected the references in our reply. It was not an accident or oversight or a misnaming of a party or anything like your Honours dealt with in Bridge Shipping, they brought the wrong action. They made no attempt to bring an action under Part IV and the question that is before your Honours is can a pleading rule that lets them now repair those defects relate back to within the two-year period.

HEYDON J: Was any attention given to section 159 of the District Court Act in Paterson’s Case?

MR MARGO: Yes. Your Honour, that section is a cure defect section and in our submission if your Honours accept the submission that this time condition is a strong condition, that extinction is strong extinction it is unavailable to cure the failure to comply with a section.

HEYDON J: You are complaining about a failure to comply with the District Court Rules and section 159 refers to:

a failure to comply with any requirement of . . . the rules - - -

MR MARGO: Yes, but there is authority, your Honour, that you cannot use a general section like that. David Grant was an analogy which I referred to earlier. The Corporations Act contained a section which allowed slips and defects to be cured but if the missing element is an integer of the right you cannot use such a general provision to supply it. That is our submission.

These general sections are not intended to, nor could they, and nor would they be picked up by 79, if they did - if our construction submissions are accepted. If one looks at the contrary consequence, if these rules can be applied then actions can be brought, depending on different facts, two, three, four, five, six years after an accident. If these rules can be used why cannot other provisions of State Limitation Acts be used that allow a plaintiff who did not know the facts to bring an action 10, 15 years later? There is no distinction, in principle, between that kind of ameliorative provision and the relation back amendment rules ameliorative–type provisions.

HAYNE J: On the question of what is a sufficient endorsement to support subsequent statement of claim, reference I think must be made to Renowden v McMullin [1970] HCA 24; 123 CLR 584. Do not deal with it now, but at some point I think attention must be paid to it.

MR MARGO: Your Honours, finishing with Air Link (No 1), a submission was strongly put by Mr Hislop for Mr Paterson that one could find in the statement of claim sufficient material facts much along the lines, I apprehend although not precisely in the same way as Justice Callinan has put to me, and that on the authority of this Court in Wickstead v Browne and the Court of Appeal in Wickstead v Browne, even if a party did not intend to plead under Part IV, if you could find within the envelope of the statement of claim - - -

GUMMOW J: Yes, well in Felton v Mulligan [1971] HCA 39; 124 CLR 367 at 403, Justice Walsh used the expression:

the federal nature of the matter . . . apparent from the claim -

Is it apparent? You see what I am getting at.

MR MARGO: In our submission, it is not apparent from the Air Link claim. I thought your Honour was putting to me a more metaphysical point about the federal jurisdiction. It is certainly not apparent from the claim. One could not fairly say that anybody looking at the Air Link claim would understand it as a Part IV claim. That is our submission.

KIRBY J: I can understand the reason for modern forms of pleading to require identification of the federal element that enlivens the federal jurisdiction but why, unless it is bound up in the notion of “matter”, is it constitutionally necessary to identify that element.

MR MARGO: I do not make a submission about constitutional necessity.

GUMMOW J: Suppose a case where the only federal suggestion was the identity of the defendant, if it was ASIC, someone was suing ASIC for something or other. That is all you knew, they just sued ASIC. Would the federal nature of the matter be apparent from the body of the claim which might be in tort?

MR MARGO: Yes.

GUMMOW J: It would just be the identity of the party, would it not? What I am getting at is in the United States you have to plead specifically under their federal rules and federal jurisdiction. You do not here.

MR MARGO: I do not know those rules, I regret to say.

GUMMOW J: Well, these are the fundamental questions about the operation of 39(2).

MR MARGO: The diversity of jurisdiction, yes.

GUMMOW J: Because you have to say that 39(2) was not invoked by what was done here in these two actions commenced within the two-year period.

MR MARGO: Your Honour, my submission is a different one. Whether or not it was invoked, the question still remains that the statute commands that the pleading bring an action under Part IV so there might be - - -

GUMMOW J: Well, that turns on the words “an action is not brought” and the action is because it comes out of the Convention, unfortunate really, but it is all bound up with the concept of “matter”, as Justice Kirby has just been putting to you, matter arising under a federal law.

MR MARGO: With respect, your Honour, “action” means - - -

GUMMOW J: If you do not start at the beginning, as I said an hour and a half ago, we are never going to get anywhere.

MR MARGO: Your Honour, “matter” for federal law purposes and jurisdiction purposes, in our submission, is a distinct question from whether or not an action has been brought under Part IV.

KIRBY J: No, but I do think that that may lie at the heart of why the Judiciary Act so provides and why, to engage federal jurisdiction, you have at least to somehow signal that there is the federal element otherwise you do not have the controversy between the parties on a federal question, because you are not identifying the source of the controversy.

MR MARGO: Yes, your Honour, you do have, but the question is could these facts that establish federal jurisdiction make it a federal matter? Could they be omitted from the pleading to bring - - -

KIRBY J: That is the second stage. You see Justice Gummow has taken you to a stage before that in the Judiciary Act which itself is anchored in the Constitution. The question is, in Australia unless you identify that federal element, whether you have properly identified an action which is a federal action, and if you do not, whether therefore you have complied with the Judiciary Act, picking up the federal statute.

MR MARGO: Our submission is that there was no federal jurisdiction until the defence was raised, but if that is wrong - - -

GUMMOW J: Despite this mysterious ticket.

MR MARGO: Yes, it was not – but if that is wrong, if we are wrong about that - and certainly the defence shows matters which engage federal jurisdiction that pre-existed the defence – the pleading had still to plead matters which engaged the statute as material facts. That is a consequence of the rules of the court, as interpreted by the court.

KIRBY J: We have seen many times in many cases, including recent cases, that the provisions of the Judiciary Act are overlooked where there is federal jurisdiction. It is just assumed you can go ahead and apply federal law, but you have to do it through the federal statute that allows you to do that. That is why you have to, as it were, find the anchor in the Constitution and in the Judiciary Act that gets you into federal jurisdiction. This is not against you.

MR MARGO: No. There is no doubt that by the time the amending applications were considered in each case the court was exercising federal jurisdiction. Therefore, in New South Wales section 79 was the only section that could have picked up the District Court Rules. We consider section 80 in New South Wales but the Solicitor-General for New South Wales supports us in this; it is a matter of statute in New South Wales. It is a statutory power conferred on the District Court to overcome limitation periods, and only section 79 could pick it up. Our submission shortly is that section 34 properly construed otherwise provides, and it cannot be picked up. It does not matter whether it is procedural or substantive; it has substantive effect.

In Agtrack the position is more complicated because one has to ask there what is the lack that might engage section 80? Section 80 applies only if Commonwealth laws do not provide sufficient remedy or of wanting for some method of implementing them or the like, and our submission is that if the strong interpretation of section 34 for which we contend is accepted, that one cannot satisfy any of the requirements to use section 80.

If we are wrong on that and the Australian common law rules as to choice of law were engaged by an application to amend outside the two-year period to bring an action under the Commonwealth Act, the legislation that is indicated by those rules, because of the Choice of Laws (Limitation Periods) Act 1993 (Vic) and/or because of your Honour’s holding in Pfeiffer is the Northern Territory Act and the Northern Territory rule. The Northern Territory Act would prevail over the rule, as would the Victorian Act, if you.....it, over the rule, and each of the Acts is in mandatory form and says that a court shall in the Northern Territory allow an amendment unless satisfied it would cause prejudice to a party in the conduct of its case. The focus is primarily on what would happen at trial. The Victorian Act is to the same effect except it uses the word “must”.

GLEESON CJ: Only, I presume, in relation to actions for personal injury.

MR MARGO: No.

HAYNE J: The Limitation Act (Vic) abolished the rule in Weldon v Neal and the rules of court are made in consequence of the provision of the Limitation Act (Vic).

MR MARGO: The rules we are considering were made by the Supreme Court Act 1996, your Honour.

HAYNE J: Well, you have to track it back, I think - - -

MR MARGO: The first set was 1986, but I think they were made under the - - -

HAYNE J: And you have to track it back into the Limitation of Actions Act, otherwise there is at least a question about the authority of the Court to make rules of court that would interfere with Weldon v Neal.

MR MARGO: Yes.

HAYNE J: But section 34 of the Limitation of Actions Act 1958 as inserted by Act 110 of 1986 was headed “Abrogation of Rule in Weldon v Neal, [1887] 19 QBD 394.”

MR MARGO: Yes, your Honour - - -

HAYNE J: It might be thought to be tolerably plain what they were on about.

MR MARGO: Yes, your Honour, and that section came into effect, 110, on 1 January, the same time as the rules. The 1986 rules had in fact been made earlier by the judges, but all of those rules under the.....Legislation Act were replaced by the new rules in 1996, as your Honour knows.

GLEESON CJ: Is it your submission that in section 34 of the Commonwealth Act the words “an action” mean – relating them back to the introductory words of the section – an action claiming damages under this part?

MR MARGO: Yes, and the submission is even stronger in the case of the dependent action in Agtrack because 35(2) refers to the liability in 28.

HAYNE J: What are the elements of an action under the relevant part?

MR MARGO: They include at least the material facts that show its federal carriage. That is the - - -

GUMMOW J: We have that here.

HAYNE J: You have that in the Victorian action. It is State Territory, or Territory State, do you not?

MR MARGO: A tourist trip was referred to.

GUMMOW J: No, the Territory and the Kimberley, I think - - -

HAYNE J: Page 3 particulars to paragraph 2, “State Territory”.

MR MARGO: Yes. Subject only to one qualification, which was only resolved in the Mount Beauty Case recently by the Court of Appeal. If it had taken off in the same place in the Territory and landed in the same place, there was a question whether that was federal carriage. Yes, the main thing in Agtrack is the absence of pleading of the requisite licence.

HAYNE J: So there is a pleading of conducting a business of aircraft charter, and the absence of plea that that was lawful business is fatal in your submission, is that right?

MR MARGO: It is one of the defects in the pleading, yes. It is a paragraph to be considered in combination.

GUMMOW J: You say defect in pleading. That is a slippery term. Are you saying it was demurrable?

MR MARGO: Yes. We say that if that were admitted, a claim under Part IV would not necessarily be made out.

GUMMOW J: What are the essential elements that must be pleaded? Of fact?

MR MARGO: They are the parts of section 27 that I took your Honours to, that there has to be a licence, it has to be commercial operations, there has to be the contract of carriage.

GUMMOW J: We have the contracts of carriage.

MR MARGO: And as the rules require that you have to identify the cause of action.

GUMMOW J: Why the last step?

MR MARGO: Just because the rules so provide?

HAYNE J: Which rule?

MR MARGO: It is Victorian Supreme Court rule - - -

GUMMOW J: Look, Supreme Court rules and District Court rules and Local Court rules are infinite throughout this country. We are trying to start with a federal law.

MR MARGO: As picked up, if picked up by section - - -

GUMMOW J: Which is drafted so to accommodate all this diversity, so it is this question, what the action means in 34, and what the essential elements are for the purposes of federal law. You persist in looking through the wrong end of the telescope.

MR MARGO: I note the time, your Honour.

GLEESON CJ: Is your time finished?

MR MARGO: No, your Honour. Now, the decision of the Court of Appeal in Air Link (No. 1) was in a line of traditional interpretation of pleadings, such as Justice Cross had done in first instance in Proctor v Jetway, as Justice Priestley observed in the Court of Appeal in Proctor, as Justice Cullinane had decided in Staples v Country & City Helicopters in Queensland. It is not an unusual decision. The characterisation of this pleading is not bringing the statutory cause of action. It had been traditionally been accepted that if you wanted to bring a statutory cause of action, you had to plead the facts which show that the statute was engaged.

McHUGH J: But does not the case stand or fall on this proposition? The plaintiff has pleaded the ticket number. We know from your defence that it sets out the carriage. Now, if you can regard the reference to the ticket number as identifying all the constituent elements that are found on the ticket, there is a cause of action as a matter of law under Part IV of the Act. It seems to me there are two points that arise. Does the ticket show the various steps? It would appear from paragraph 10 of your defence it does, the various legs, and, if it also shows that you were being carried on an aircraft by the holder of an airline licence, what else do you have to complain about?

MR MARGO: Nothing, your Honour, except it did not plead the licence. It pleaded the wrong licence.

McHUGH J: No, but if the ticket itself shows the licence.

MR MARGO: The only complaint that could be made is that it is outside of the pleading. This is not our ticket.

McHUGH J: No, it is nothing to do with rules of court. It is a question, first of all, as to whether under section 39(2) the District Court was invested in federal jurisdiction in a matter in which the High Court has original jurisdiction. One matter in which the High Court has original jurisdiction is a matter arising under a law of the Commonwealth. An action for damages under Part IV is an action arising under a law of the Commonwealth. So the only question is, for the purpose of section 34, did this pleading show an action for damages under Part IV? Once the facts are pleaded, as a matter of law, if they are properly pleaded, it shows that the action is under Part IV. You do not have to say it is under Part IV. What I am putting to you is if the ticket discloses all the details, if it shows the various steps so that you conclude it was a single carriage, if it shows that the carrier was the holder of an airline licence what more is needed, as a matter of law?

MR MARGO: The pleading would still, considered as a whole, be a pleading in negligence and contract not - - -

McHUGH J: No, it is not, because as a matter of law - - -

MR MARGO: As a matter of jurisdiction.

McHUGH J: As a matter of law it shows it cannot be an action for negligence because federal law destroys the action for negligence and substitutes its own regime. The pleading may have surplusage in it, but once you see the particulars arising from the ticket number then, as a matter of law it is an action under Part IV. It cannot be an action in negligence and it cannot be an action in contract because federal law says so.

MR MARGO: Your Honour, there is a distinction, in my respectful submission, between an action being available at law and pleading that action.

McHUGH J: You do not have to plead it. Section 34 does not say anything about an action being pleaded.

MR MARGO: Article 28(2) does, your Honour. It uses the same words “action . . . brought”. It says it “shall be” brought in accordance with the rules “of the Court seised of the” matter.

GUMMOW J: That is Convention language.

McHUGH J: That is in the Convention.

MR MARGO: It is, your Honour.

GUMMOW J: I thought we had decided that did not have a counterpart.

MR MARGO: It does not have a counterpart because it is assumed, in our submission, that the rules “of Court seised of the” matter will govern. It is not necessary to say so.

GUMMOW J: No. Can we assume that there were regulations made under section 40 regarding tickets and what they have to say?

MR MARGO: I think you can assume they were made, your Honour.

GUMMOW J: Have you the front of the ticket? We can assume effective – did the affidavit have the front and the back of the ticket or just the front?

MR MARGO: I am told one cannot assume that, your Honour.

GLEESON CJ: The affidavit said that a copy of the ticket was annexed to it. It did not say a copy of the coupon or a copy of part of the ticket.

MR MARGO: I am instructed in response to – I am sorry, your Honour, I did not get that last question, but you asked for a copy of the ticket referred to in the affidavit?

GLEESON CJ: A copy of the annexure, actually. The affidavit says a copy of the ticket is annexed.

MR MARGO: Yes, but, your Honour, I am instructed that what happened is we asked for the ticket, and what is in the appeal book is all that we were given and that is what was annexed.

GLEESON CJ: So a copy of the ticket was not annexed. All that was annexed was a copy of the coupon?

MR MARGO: Yes.

CALLINAN J: The ticket number is nonetheless pleaded and the appellant would have been bound to produce it and you would have been bound to produce any copy of it had that been required, as it inevitably would. It is incorporated by reference in the pleading in full.

MR MARGO: But what was produced as the thing incorporated was at page 18 of the appeal book.

GLEESON CJ: Can we take it that ZL is the code for Air Link?

MR MARGO: I am sorry, your Honour, I need instructions on that.

GLEESON CJ: I am just looking at the carriers that are listed on page 34.

MR MARGO: We will try and find out.

GLEESON CJ: Thank you.

KIRBY J: I did not hear the answer.

MR MARGO: We will try and find out. We do not know in Court. If there was not a licence of the requisite kind under section 27, we would have been outside the regime of the Act, and we might, at most, have been liable for negligence or in breach of contract. The ticket might have – but did not, as we now know – refer to international traffic. It might have been interstate. It might have been subject to the New South Wales Act. We say that the pleading was not certain or definite to the degree required by the rules under which that action was brought.

Did your Honour Justice Kirby want me to deal with knowledge of the defendant at all? Our submission is that what the defendant knew is irrelevant to whether or not an action had been brought. Let me just say that knowledge of the defendant might be relevant to an estoppel claim. It would be difficult to imagine any possible estoppel claim in Air Link or Agtrack, for that matter, where the defendant had pleaded promptly without messing around that the claim was not maintainable and no particulars were - - -

KIRBY J: Set aside the Convention for a moment. If you just got section 34 where it says “plead the action”, you would in the normal way say that does not mean you necessarily have to plead the cause of action. You have to commence the action, and then you would say, “Well, that is in the context of giving a party due notice of the action”, and if they plead a ticket, as has been put to you now by the Court, that is giving you due notice of the action, and on its face that coupon which is reproduced is an indication that you are excluding the common law and therefore the matter of which you have been given due notice is an action under the statute, even though it is not pleaded in that way.

MR MARGO: Yes, I understand that is what is put against us.

KIRBY J: Because the coupon is enough to identify destinations.

MR MARGO: I understand what is put against us. It is our submission – and I take it your Honours will either accept it or not – that material facts have to be pleaded on the face of it. They cannot be sought in this way even if the matter is in federal jurisdiction, which it is not.

KIRBY J: I am affected by what you have put concerning the international authority on the Convention and the rather strict view that has been taken, but it is a view that is uncomfortable for a modern judge in this country to take because there has, even in my lifetime, been a relaxation in such strictness and we tend to react unfavourably to the notion that you have to impose these rigid laws.

MR MARGO: If your Honours were to follow the line which the New South Wales Court of Appeal took, they felt that Part IV should be interpreted differently to the sections – parts of the Act that applied the Convention.

McHUGH J: Well, I think there are very considerable difficulties about amendment. Subject to hearing what the other side says, it does not seem to me that if the action is extinguished you can revive it by any rules of court. But your problem, it seems to me, is to whether it was ever extinguished in the first place.

MR MARGO: Yes. I think I have said what I can on Air Link (No 1) about that matter. I am instructed that ZL is not Air Link, your Honour.

GLEESON CJ: Is Air Link referred to? Is Air Link one of the people referred to on the coupon?

MR MARGO: ZL, I am told, is Hazelton - - -

GLEESON CJ: Is Air Link referred to on the coupon?

MR MARGO: It is being checked, your Honour, whether there is any – we do not know that it is but we are just checking.

GLEESON CJ: Thank you.

MR MARGO: On ultra vires, your Honours, may we say that it is not correct, with respect, to characterise these rules abrogating Weldon v Neal as simply removing a fetter on a common law discretion, that these rules in fact confer a power to overcome substantive limitation statutes.

We say further in the case the District Court rules, the submissions not made for Victoria, that there is no primary statutory backing for such a rule. The sections – the rule-making powers engaged I referred to at appeal book page 170, paragraphs 83 and 86. I am instructed there is no reference to Air Link on the coupon.

GLEESON CJ: Thank you.

GUMMOW J: Really, how could that be?

MR MARGO: Well, 83 is the rule.

McHUGH J: That is because the ticket is issued by Qantas, is it?

MR MARGO: Yes.

GUMMOW J: What about the breaking up of the journey between various carriers? There is a caution on the ticket. I think you had better look at it more carefully. Do not do it now.

MR MARGO: I am sorry, is your Honour putting to me that the ticket does show a reference to Air Link?

GUMMOW J: I just do not know.

GLEESON CJ: We are not putting anything to you, we are asking - - -

MR MARGO: No I am sorry, I - - -

GLEESON CJ: The reason we are in this difficultly is that the affidavit states - swears actually - that it is annexing a copy of a ticket, and it appears that it did not annex a copy of a ticket.

MR MARGO: Yes.

GLEESON CJ: All that was annexed to the affidavit was a copy of a coupon or part of a ticket.

MR MARGO: As between the parties, may I say in defence of the people who prepared the affidavit it was perfectly well understood that what was annexed had been supplied by the plaintiff. There was a request for particulars and that was what was annexed.

McHUGH J: But the ticket apparently refers to six different segments of a journey. It would be surprising if Hazelton was not mentioned.

KIRBY J: You say ZL is the signature for Hazelton?

MR MARGO: Yes, I am told it is abbreviation for Hazelton.

GLEESON CJ: Is Air Link Pty Limited a subsidiary of Qantas?

MR MARGO: It is not a subsidiary of Qantas.

GLEESON CJ: How does the ticket identify, if at all, the carrier who was carrying on the relevant leg of the journey?

MR MARGO: May I take that question and tell your Honours after lunch?

GLEESON CJ: Yes, certainly.

MR MARGO: And if we can get the ticket we will, but perhaps the other side have it, we do not have it.

KIRBY J: Well, if it was not in evidence, we cannot receive it. But “CARRIER” is on the coupon. It has “CARRIER” and then there is a column. It has “AN” which was Ansett and “ZL” which was Hazelton. That is at page 34.

CALLINAN J: Well, I am not sure that the ticket cannot be regarded as being in evidence, even if it has to be proved by secondary evidence, because arguably it is incorporated by reference in the pleadings. I just do not know. I am raising that as a possibility, Mr Margo.

MR MARGO: In our submission, your Honour, that would be a very novel departure for interpreting pleading rules.

CALLINAN J: Not a bit of it. Lots of pleading rules contemplate a reference to a document as incorporating the document.

MR MARGO: But if you ask for the document and what you are given does not give the information that your Honour is now - - -

CALLINAN J: Not at all, you are given the incomplete document, and in any event your client would well know to the last comma exactly what the contents of the total ticket were.

MR MARGO: With respect, your Honour, my instructions are that we had to ask and we did not know except what we were told.

CALLINAN J: You would have known what the standard conditions were. They print hundreds of thousands of these, Mr Margo.

MR MARGO: We did not issue this ticket, your Honour, but - - -

GLEESON CJ: Mr Margo, your argument may be correct in every particular and you may be entitled to succeed in your appeal, but it is a little difficult to accept that there is any mystery about the terms and conditions of a Qantas airline ticket.

MR MARGO: Your Honour, I hope to give you after lunch exactly how the ticketing works.

CALLINAN J: I would be more interested in the contents of the ticket, which I would like to see and receive provisionally. It may be that you are perfectly correct that I am not entitled ultimately to refer to it, but at the moment I am not persuaded about that, and I would like to have the opportunity of seeing a standard form of ticket so that I could at least give proper consideration to that question, and there seems to be a determination not to provide it. I am sure - - -

MR MARGO: There is no such - - -

CALLINAN J: Just listen to me, please. It is within the resources of your client to provide us with the details of all of the contents – the relevant contents, the standard terms and conditions – of the ticket with which the respondent was issued.

MR MARGO: Your Honour, we will do what we can to meet the requests of the Chief Justice, and the question, in my submission, should be addressed to the respondents as well. They are the ones who would hold the parts of the ticket that would have the conditions on it.

GUMMOW J: You were the sector from Cobar to Dubbo, were you not?

MR MARGO: I think it was Dubbo-Cobar return. We fly out of Dubbo. Your Honours, the District Court section 161 in its original form – that is the rule-making power for civil rules – is in paragraph 83 at page 170 of the Air Link appeal book. As the learned President recounts, in 1994 section 161 was amended, and your Honours have the relevant portions of the amended section in the judgment. But when the amendment was brought in two things were said. The first was that the rules were not to be concerned with any matter other than the court’s exercise of its jurisdiction. That was made clear when section 161 was widened to permit the court to make rules relating to other Acts that conferred jurisdiction on it, and our submission shortly put is that the rules that could have been made under the new section were validated by the 1994 Act, and our submission shortly put is that neither under the original form of 161 nor under the amended form of 161 were the judges authorised to make a rule which had the effect of overcoming substantive limitation periods.

Now, at the time of course these rules were made, the characterisation of limitation periods was not as crisp as it is today, in light of your Honours’ decision in Pfeiffer, but that decision has led to a re-examination of the primary statutory backing for – or absence of backing for - such rules, and the matter, unfortunate as it might be, would be easily cured and that is a matter of power and not simply of discretion. We rely on the obiter dicta of Justice Toohey with whom Justice Deane agreed in Wardley v State of Western Australia, quoted in all the cases on these matters.

May I take your Honours to the Law Reform Commission Report on reasons why section 6 was inserted in the Supreme Court Rules to give primary statutory backing to those rules. If your Honours have Report No 92, the Second Report of the Law Reform Commission on Supreme Court Procedure LRC 14 at page 12, paragraph 1. This is one of a number of provisions that is dealing with section 6 whereby the Supreme Court Act and the rules would prevail over Acts in force before commencement of the Supreme Court Act. They refer to the constitutional principle that one does not normally do this by delegated legislation. They then refer in paragraph 4 to numerous examples where it has been done by delegated legislation but in every case with primary statutory backing and then they continue at paragraph – they give reasons why that is really just too hard to dig up all the rules that might provide for contrary procedure and eventually say that a limited departure from the normal rule that you will not overcome substantive rights by delegated rules was warranted in this case and section 6 should be passed. There is no equivalent in the District Court Act.

There was some dispute early in these proceedings, earlier stage of the proceedings, about whether section 6 of the Supreme Court Act was relied on by the Court of Appeal in Proctor v Jetway. May I give your Honour page references to places where it was strongly relied on by the learned President. In Proctor v Jetway Aviation Pty Ltd [1984] 1 NSWLR 166 at pages 172F, 173B, 174D to E, 175G to 176A, and Justice Glass agreed with both the President and Justice Priestley.

Proctor has been so interpreted by other State courts considering it as relying on and being distinguished by section 6 of the Supreme Court Act.

In Agtrack, if common law choice of rules are engaged for a purpose of filling in gaps for a court exercising federal jurisdiction, they point to the Northern Territory. I have already told your Honours about the mandatory nature of the Northern Territory section 48A. Could I refer your Honours also please to other sections of the Northern Territory Limitation Act, which raises a separate issue; namely, whether the Act would be applicable if picked up by either 80 or alternately 79.

Could I take you first please to section 5 of the Northern Territory Act. Do your Honours have that Act? Section 5 says:

This Act does not apply to any action for which a period of limitation is prescribed by any other enactment other than an enactment referred to in section 3.

Section 3 refers only to Imperial Acts that formerly had application in the Northern Territory, South Australian Acts likewise, or Northern Territory Acts. Could I refer your Honours also, to make good a submission I made in answer to a question by Justice Heydon earlier, section 36 of the Northern Territory Limitation Act. If a provision like 48A could be picked up so could – in principle there is no reason why – and not be otherwise – and section 34 not otherwise provide, why could not section 36 be picked up, “TIME NOT TO RUN WHERE PERSON UNDER DISABILITY”. Yet if section 34 is interpreted in the strong way that the Convention cases interpret Article 29, one could not possibly toll for disability.

Then your Honours have 48A itself with the words, “must”, “shall”. The court below read down the Act as permissive because the rules are permissive. They read “may” in the rules as permissive, and they read the Act down as permissive, and they also dealt with the matter in the Victorian Court of Appeal on the basis the applicant had only sought a remedy under the rule, not under the Act, and they contemplated the possibility if a remedy had been sought under the Act a different result might have flowed. In our submission, the Act, if there were any need to resort to common law choice of law rules, it would be the Northern Territory Act, and section 48A that would be picked up, and it would be repelled on a strong construction of section 34.

GLEESON CJ: I thought you suggested that there was an absence of reference to a licence in the Air Link pleading. Is that right?

MR MARGO: The licence that is pleaded is a licence under the State Act which is only required for intrastate carriage.

GLEESON CJ: I see, thank you.

MR MARGO: What is required to be pleaded, in our submission, is one of the two kinds of licences that are referred to in section 27 of the Commonwealth Act.

GLEESON CJ: That would be a licence under what Act?

MR MARGO: Under the Commonwealth Air Navigation Regulations – sorry, your Honour, those are the definitions that are referred to – the licence, as defined - - -

GLEESON CJ: The Civil Aviation Act?

MR MARGO: Article 26.

GLEESON CJ: The answer is Civil Aviation Act?

MR MARGO: I am sorry, yes, 1988, the regulations are made under the Air Navigation Act 1920. If we did not have a licence under the – and it was not federal carriage, at most, we say on that pleading that we could have had damages awarded against us for negligence or breach of contract.

GLEESON CJ: We understand that.

MR MARGO: I note the time, your Honours. We will try and answer your question about the ticket after lunch.

GLEESON CJ: I see. Very well, we will adjourn until 2.15.

AT 12.44 PM LUNCHEON ADJOURNMENT

UPON RESUMING AT 2.17 PM:

GLEESON CJ: Yes, Mr Margo.

MR MARGO: Thank you. Your Honour, the position regarding the ticket, the results of our inquiries are, we do not keep – we never receive the full ticket. All we receive are the coupons, and the coupons themselves we never keep because we send them in to claim money. We do not have or have not presently been able to locate any copy of standard terms that might have been attached to a ticket at that time. We accept that if we did not have actual knowledge, we would have certainly had constructive knowledge. We certainly had knowledge that there were conditions attached and if we did not know what the detail was, we would have had constructive knowledge of the content of the terms at the time and your Honour should also know that as we said in our defence, we accept that we performed a leg Dubbo to Cobar and Cobar to Dubbo which appears under the code of Hazelton. I am told that the - - -

GUMMOW J: But for that purpose you are the relevant ZL.

MR MARGO: I do not know that that conclusion would follow, your Honour, because I have not been able to find any more information, but we certainly performed a leg of the ticket - - -

GUMMOW J: Otherwise the ticket was misleading.

MR MARGO: I can only tell you the facts that I have been able to ascertain. We are not ZL but we certainly performed that, and I understand that the plaintiff is making attempts to find the ticket and if it is found we can address that.

GUMMOW J: I am not surprised.

MR MARGO: When the breeze is blowing.

KIRBY J: I would not want to receive any evidence contrary to Mickelberg v The Queen.

MR MARGO: That is a matter which could be addressed if it is located. It was a 1998 ticket. On Renowden v McMullin, to answer something that fell from your Honour Justice Hayne, our submission simply is that in this case we do have two statements of claim. Both were commenced by statement of claim and the question is: were those statements of claim sufficient to raise a matter under the Commonwealth Act? In our submission, they were not. We respectfully submit that a matter has to be raised as a claim by the pleading in order to be a justiciable controversy. We submit that the courts below were correct in holding that the documents before them did not raise a claim under the Commonwealth Act and federal jurisdiction would, therefore, first have been engaged if we had admitted the matters and they had sought relief under the Commonwealth Act at that point, which certainly was raised by the defence, and in Air Link that defence came outside the two-year period. We were served outside the two-year period. In Agtrack the defence was put on within the two-year period and said the claim was not maintainable.

Could I give your Honours references also to Felton v Mulligan [1971] HCA 39; 124 CLR 367 at 402 to 403, that is the judgment of Justice Walsh, Moorgate Tobacco Company Limited v Philip Morris [1980] HCA 32; 145 CLR 457 at 476 in the joint judgment of Justices Stephen, Mason, Aickin and Wilson, and Wakim; Ex parte McNally [1999] HCA 27; 198 CLR 511 at paragraph 139 and following in the joint judgment of Justices Gummow and Hayne.

KIRBY J: What do those citations support?

MR MARGO: We submit that they support that a claim has to be made on the face of a pleading, but federal jurisdiction may arise later if a defence raises a matter, and it is unclear from Wakim the extent to which one can look into facts underlying a pleading. It is our submission, however, in answer to the matter raised by Justice Callinan that it is not enough in a document simply to have facts stated which are not used to mount a claim on the face of the document to raise federal jurisdiction. The fact that a matter might or might not give rise to a claim under federal jurisdiction does not constitute it as a claim.

GUMMOW J: What was the paragraph in Wakim?

MR MARGO: Paragraph 139 and following. There is a mixed discussion there of the issue that I have referred to and the question of relation between State and federal matters and whether they constitute one controversy.

Your Honours, I am anxious to clear up the matter that was raised by your Honour the Chief Justice, to the extent I have managed to do so. The statement of claim in Air Link was issued on 22 September 2000. On 12 October 2000, that was within weeks, at page 11 of the appeal book is the letter requesting particulars written by Air Link from Dubbo to the plaintiff asking for a copy of the ticket and particulars of the ticket.

The next step was the reply was received on 26 February 2001. That is at page 18 of the appeal book, and if your Honours look at page 18 you will see – if you have not already seen it – it enclosed copies of the ticket. Then what was enclosed is at page 34 of the appeal book. That is just the face of two coupons. The coupons do say on their face “Subject to Conditions of Contract” in the ticket. We do not have the conditions.

When Mr Cotton swore his affidavit, which is at page 30 of the appeal book, the precise words he used were:

Annexed hereto and marked “B” is a copy of the airline ticket provided by the Plaintiff’s solicitor under cover of letter dated 26 February 2001.

That is just in support of my submission that as between the parties there was nothing misleading about the affidavit.

GLEESON CJ: Mr Margo, have you checked on whether there were any regulations under section 40(b)?

MR MARGO: I forgot to do that, your Honour.

GLEESON CJ: You do not have to do it now, maybe you can do it overnight, but we would just like to know - - -

MR MARGO: I did say I would do that and we have forgotten that point.

GLEESON CJ: - - - whether any regulations were in existence at the relevant time concerning the matters to be included in tickets.

MR MARGO: If it please the Court, unless you have any questions those are the appellants’ submissions.

GLEESON CJ: Thank you, Mr Margo. Yes, Mr Burmester.

MR BURMESTER: If it please the Court, given the Commonwealth’s position in this matter, it was thought appropriate that we come after the appellants and before the respondents. There are only two issues that I really wish to deal with in oral submissions and we rely on our written submissions.

The first is the bringing of an action under Part IV of the Civil Aviation Act, and what that actual requires or means. And it is our submission that the mistake made by the courts below and with respect to my learned friend this morning, is to start with the State laws governing the pleadings rather than with the requirements of the Commonwealth Act. The focus on State pleadings then led to a focus on questions like: what was the field of those laws as opposed to the Commonwealth law, and so on.

It is our submission that one should start with the Commonwealth Act because that is the federal jurisdiction, the basis of federal jurisdiction, that is the cause of action that is at issue. And it is our submission that section 34 is regarded as a substantive limitation law that extinguishes the right that any State law that sought to preserve that right would not be able to operate consistently with that provision in Commonwealth law.

So one has to then ask: what are the requirements of Commonwealth law for there to be an action under Part IV? And as our submissions make clear, there are in a sense two components. There is: what is bringing an action; and then, what is bringing an action under Part IV? And in paragraphs 10 and 11 of our submissions, we set out what we consider are required. It seems to me that some of the issues in this regard are conveniently dealt with in the Western Australian case of Morgan v Banning (1999) 20 WAR 474. If I could take your Honours to that.

At 476, at the bottom of the page, in the judgment of Justice Owen he says this problem of reconciling Limitation Acts with the amendments:

falls away if . . . “cause of action” . . . is understood in a narrow sense as meaning the basket of facts which give rise to the right to approach the court for relief rather than as the description of the right to sue by reference to the old forms of action.

From that we say the critical issue is what of a basket of facts that are in the particular documents. If I could then go to Justice Wheeler’s judgment at page 483 between B and C, the paragraph:

It appears to me that two consequences follow from the proposition that the Limitation Act is concerned with the writ and not with “good or bad indorsements”, let alone with statements of claim. First, if the writ when issued, although defective, is not a nullity, and its terms are wide enough to encompass the amendments sought to be made to clarify or particularise or “cure” it, then it seems that no question of limitation arises . . .

The second proposition . . . is that if the defective indorsement appearing on the writ when issued, is not of a type which is capable of encompassing amendments sought to be made after the expiry of the limitation period, so that the amendments truly “add” an additional and time barred cause of action . . . then, whether leave to amend is granted or not, the new action remains time barred.

Going over to 484F, she suggests that confusion might be avoided if one uses the expression:

“cause of action” in order to describe merely a factual situation which will entitle a person to approach the court for relief, and “form of action” to refer to the old categories –

and then over on page 486B he says:

If I am correct in the view that the court’s inability to permit the raising of a new cause of action (rather than a new description or new form of action) is as a result of a lack of power to do that which the statute of limitation prohibits, then O 21, r 5(5) and its equivalents can only be directed to curing the unduly rigid and narrow interpretation of Weldon v Neal –

So, in our submission, if one adopts that approach to the current issue, one looks at section 28 of the Commonwealth Act, and the critical facts that need to be pleaded are not that a claim is brought under Part IV but there are sufficient facts to indicate that one is dealing with a person on board an aircraft suffering an accident, and that there are sufficient facts to indicate that as a result of the accident on board the aircraft or while disembarking that injuries were suffered.

GLEESON CJ: Do you mean by that the test is would a person, familiar with the provisions of the Civil Aviation (Carriers’ Liability) Act, reading that statement of claim, understand that if the plaintiff had a right to recover damages it had to be a right of the kind given by the Civil Aviation (Carriers’ Liability) Act?

MR BURMESTER: Yes, your Honour, that if the ticket is mentioned, and from that one could, through particulars identify the flight, if the circumstances of the injury are given and it, through particulars, is able to clarify that that took place on a flight covered by the Civil Aviation Act, then that would suffice.

KIRBY J: Is that the test of the subjective response of the person who receives the document? I would have thought the federal Act reflecting the policy of the Convention, the treaty, is laying down something rather more objective. It - - -

MR BURMESTER: Well, your Honour, I would not have described what I was putting as essentially subjective as rather, “Can you from the facts that are stated draw the conclusion that this is in fact a claim arising in federal jurisdiction involving the Commonwealth Act?” Now, it may be that in a local court for a $200 claim for a bag, that simply that by itself would not be sufficient to make the matter one in federal jurisdiction. It would only be when further particulars or pleadings were brought or a defence was lodged, that one would then know that one was in federal jurisdiction.

GLEESON CJ: Your argument, as I understand it, whether it is right or wrong, is that it does not matter what the plaintiff knew, what the plaintiff’s lawyers, and it does not matter what the defendant knew or the defendant’s lawyers. You look at it from the point of view of somebody who is aware of the provisions of the federal Act. In other words, you look at it though the eyes of the federal Act. If somebody who is aware of the provisions of the federal Act, looking at the statement of claim and looking at the facts alleged in it, would know that if the plaintiff had a right to recover damages, it could only have been a right of the kind given by the Act, then that suffices to satisfy the words of section 34.

MR BURMESTER: That is correct, your Honour. We say that is sufficient.

HAYNE J: Is it then an element of that that the statement of claim reveals facts that would show that the relevant part of the federal Act applied to the carriage in question?

MR BURMESTER: We would submit that it would have to show sufficient – that if, when further particulars or information were provided, one could work out - one would discover which particular part. So it may be if it simply said “between Cobar and Dubbo” without indicating that it was part of the bigger ticket, that that on its face would not at that stage be an action brought under Part IV, but it may be when the defence was then put in that that would disclose that it was in fact an interstate flight, and at that stage it would clearly be a matter of federal jurisdiction.

HAYNE J: I am looking at paragraphs 10 and 11 of the written submissions. Am I to understand particularly paragraph 11 as saying that it is not necessary to plead the facts which engage the federal Act beyond personal injury suffered by a passenger resulting from accident on board or in the course of embarking or disembarking?

MR BURMESTER: Yes your Honour, because as a matter of law the Civil Aviation Act then attaches and applies to those facts so that the cause of action under Part IV does not depend on whether you plead that you are bringing an action under Part IV, but whether you plead sufficient facts, a sufficient basket of facts, that one can say this is as a matter of law, as a consequence of the terms of the Civil Aviation Act, covered by that piece of legislation.

The beauty, if I can call it that, in our submission, of our approach is that it does not then turn on the different pleading rules in the different courts of the country. It may be that in a local court where there are very few pleadings that you will need to supplement them in some way before you know you are exercising federal jurisdiction and that the Civil Aviation Act attaches, but - - -

GUMMOW J: The trouble with paragraph 10 is that it may be too broad. It does not allow for purely intrastate carriage.

MR BURMESTER: I accept that, your Honour, but if the statement, for instance, as in the Air Link Case here, says it was between Cobar and Dubbo but then refers to a ticket - - -

GUMMOW J: I understand that, yes.

MR BURMESTER: - - - then you could bring it in.

GUMMOW J: And in the other one, you have the Kimberleys and the Territory, I think?

MR BURMESTER: That is right.

McHUGH J: Mr Burmester, can you help me on the interrelationship between the Commonwealth Act and the State Act? If you go to the Commonwealth Act, the definition of “Air Navigation Regulations”, it states that that term:

includes those Regulations as in force by virtue of a law of a State.

Then if you go the New South Wales Act, the Civil Aviation (Carriers’ Liability) Act, section 6A says:

(1) It is the intention of the Parliament –

that is the Parliament of New South Wales -

that the applied provisions should be administered and enforced as if they were provisions applying as laws of the Commonwealth instead of provisions applying as laws of the State.

Section 5 says that:

The provisions of Parts IV and IVA of the Commonwealth Act –

subject to some exceptions –

apply to and in relation to carriage to which this Act applies . . . as if those provisions were incorporated in this Act –

et cetera. Now, what is the effect of all this, particularly that definition in “Air Navigation Regulations”?

MR BURMESTER: I think the explanation for that particular definition is that by defining it in that way when the State law then picks up the Commonwealth law in the terms it has as a Commonwealth law, then the provisions are able to work.

McHUGH J: Does it mean then that by a combination of sections 5 and 6A of the State law, together with that definition, that the State law then operates as federal law?

MR BURMESTER: I cannot see how that can be formally the position, despite, as your Honour points out, that is what it says. I mean, I think what it is trying to do is to pick up the Commonwealth Act without the need to sort of change references in it, and - - -

McHUGH J: That is the way you would normally read it, but then when you see the extended definition of “Air Navigation Regulations”, which I do not think I have ever seen before in a federal Act, it:

includes those Regulations as in force by virtue of a law of a State.

MR BURMESTER: I said my only explanation is that they are anticipating the State laws coming along and picking up the Commonwealth law word for word and, unless those words were in, then there might be an issue that they clearly were not applying under the Air Navigation Act and therefore the State law that sought to pick this up would not be effective. That is all I can suggest. I have no basis to make the suggestion other than what I can get out of reading the words, that it is anticipating the consequential State laws and the fact that they would be trying to pick up the Commonwealth law completely unchanged.

McHUGH J: The reason I asked is the thought occurred to me that perhaps in some way, by combination of these Acts, the federal law covers the field including intrastate.

MR BURMESTER: Certainly, your Honour, I think it is designed to ensure there is, in a sense, a seamless – the same remedy applies regardless so that one does not have different consequences, whether one is on an interstate or intrastate flight. Certainly, the aim is to, as it were, whether you are on an international, interstate or intrastate, essentially your rights will be the same, your - - -

GUMMOW J: The devil may be in the definitions. This phrase, “Air Navigation Regulations”, is picked up in the definition of charter licence, you see?

MR BURMESTER: Yes.

GUMMOW J: Is it picked up anywhere else in Part IV?

MR BURMESTER: In the definition of “airline licence”?

GUMMOW J: And in the definition of “airline licence”, yes.

MR BURMESTER: I think unless you had this extended definition when the State law then picked this up, there would need to be some translation provision in the State law unless one had this extended definition.

KIRBY J: Where does that leave the view of a differential meaning of section 34 and Proctor v Jetway?

MR BURMESTER: Your Honour, we would say Proctor v Jetway is clearly wrong if it was applying federal law. On the other hand, there is an alternative explanation of Proctor v Jetway not based on section 6 of the New South Wales Act but the particular amendment was in fact adding a new cause of action based on substantially the facts that were already there and so it was, in that sense, compatible with our - - -

KIRBY J: Is that how Justice Ipp got around Proctor v Jetway? He did not overrule Proctor v Jetway. He did not favour overruling.

MR BURMESTER: I cannot answer that question, your Honour. It does seem to me there is an alternative explanation for Proctor v Jetway. It was an argument that the court did not spend much time on but it was certainly put there as an argument and it would, on that sense, if all they were doing was amending to add a cause of action that was already there in the basket of facts then we would say it was compatible with the position we are putting. But certainly it is not compatible with the position we are putting if one used section 6 to, as it were, overcome an extinguished cause of action.

GLEESON CJ: But how does your test operate in a case where, if you look at the facts alleged in the statement of claim, the proper conclusion is that the rights of the plaintiff might or might not be under the Commonwealth Act?

MR BURMESTER: Your Honour, if one could not reach a view either way then until additional facts or particulars or defences were provided, you would not be in a position where you could say you were in federal jurisdiction and so the time limitation would need to be considered from the time when you knew you were in federal jurisdiction and that the federal Act had been triggered.

GLEESON CJ: Does that mean that unless the statement of claim alleged that the carrier was the holder of a licence?

MR BURMESTER: No, your Honour. We do not see that as an essential component.

GUMMOW J: Why not? Because of 27 and is this not tied up with what Justice McHugh was raising with you because you go to 27(4). That includes the Cobar/Dubbo airline which is caught up in Part IV because it is one of the successive stages. The Cobar/Dubbo operator only has a State licence, but he still has a charter licence because it is under the Air Navigation Regulations as picked up by the State. Do you see what I mean?

MR BURMESTER: I see what you mean, your Honour.

McHUGH J: That was why I asked these questions because it may be that the pleading alleging a licence under the Air Transport Act may be sufficient to draw attention to the fact that there is a licence within the meaning of “airline licence” in section 26, or “charter licence”.

MR BURMESTER: Yes, I had not considered that approach, your Honour. You may be right.

HAYNE J: But one of the things that emerged in the most recent exchange was that I understand you to say that there must be something in the pleading that reveals that federal jurisdiction is engaged. Am I right in understanding the submission in that way?

MR BURMESTER: Until that is there you do not have a cause of action under Part IV.

HAYNE J: And then what is it that will suffice to demonstrate the engagement of federal jurisdiction other than either specific named reliance upon the Act, the clearest case, or the pleading of each of the elements which together has to be established to engage the federal Act.

MR BURMESTER: Your Honour, it would be possible through a defence whereby the federal Act was referred to, to, as it were, the other party acknowledges that that is in fact what is involved. That would, in our view, suffice.

HAYNE J: Well, in one of these cases a defence is put on a few days after the two-year period from accident has run, and the defence reveals, holding the necessary licence and the carriage having the requisite interstate or Territory connection. Now, is it not until that goes on that it is apparent that federal jurisdiction is engaged, because that seems to represent a rather marked departure from what appears in paragraphs 10 and 11 of the Commonwealth submissions.

MR BURMESTER: Your Honour, that putting on of the defence would only be necessary if there was not otherwise adequate facts in the documents already before the Court, in the writ or the statement of claim or whatever. So we are not saying that until the defence comes along and refers to the Act that the federal Act is not implicated, and one is not in federal jurisdiction, if there are sufficient facts. It may be in the Local Court that until the defence is put on that will be the consequence; you will not know. It is not apparent. It is not possible to deduce that the cause of action is federal jurisdiction.

GUMMOW J: There must be something in the federal Act, in the Navigation Act, I think, and in the State Act which says that it is an offence to operate without a licence, must there not?

MR BURMESTER: Your Honour, I am not sure whether it says that or whether simply this Act would not apply.

GUMMOW J: No, no.

McHUGH J: Section 3 of the Air Transport Act 1964 (NSW) says:

A person shall not carry by an aircraft from a place in New South Wales to another place in New South Wales any passengers unless:

(a) the person is the holder of a licence - - -

GUMMOW J: And there is something in the federal Act, too.

MR BURMESTER: Yes. Not in the Civil Aviation - - -

GUMMOW J: No, no.

MR BURMESTER: No, that is right. And it will be an offence - - -

GUMMOW J: Yes, that is what the licensing system hangs off.

MR BURMESTER: That is right.

GUMMOW J: So one could assume - - -

MR BURMESTER: So the assumption is - that is why we do not see it as essential.

GUMMOW J: Yes, I see what you say.

MR BURMESTER: The assumption is if one is offering - - -

McHUGH J: But somehow or other 27(4) assumes that an intrastate carrier may nevertheless hold a licence, either a charter licence or an airline licence within the meaning of section 26 of the federal Act.

MR BURMESTER: Well, it may be in fact that intrastate operators do require a federal licence. I think since Airlines of New South Wales (No 2) the regularity efficiency of air traffic generally - I think State air carriers may well need a Commonwealth licence and a State licence. So that may be the explanation for that.

GUMMOW J: We need to know the answer to that, I think. You are the obvious target.

MR BURMESTER: I will undertake to clarify that overnight, your Honour. As I said, that ability to use the interstate trade and commerce power to cover all aviation would not, however, extend into creating a liability regime, which is why the Civil Aviation Act is limited.

GUMMOW J: Quite. The message of the airlines of New South Wales legislation is that you needed both, is it not?

MR BURMESTER: That is right, and I suspect that is the case.

GUMMOW J: Yes.

McHUGH J: But you do not really have to spell out the implications of facts to raise federal jurisdiction, and if the statement of claim alleges that the plaintiff lives in Pinjarra and the defendant lives in Camooweal and there is nothing more, you would need evidence to show one is in Western Australia and one is in Queensland, but the High Court has jurisdiction and that - - -

MR BURMESTER: Yes, I am not disputing that, your Honour.

McHUGH J: No.

MR BURMESTER: I am not – but it does essentially depend on looking at the facts, and we make no submissions as to whether on these particular pleadings which result ought to be reached, but there seems at least arguments there that they adequately disclose that they were actions to which the Civil Aviation Act attaches of its own force, by force of law automatically without the fact that it had to be pleaded.

The other issue, your Honours, on which I wish to briefly comment was the operation of sections 79 and 80, and it is my submission that it is not necessary in this case to seek to resolve fully the relationship between sections 79 and 80. We say whichever route you use to get there, the outcome will be the same, and we do not contest the proposition that in relation to the conduct or exercise of jurisdiction over a matter in federal jurisdiction, State laws only apply through sections 79 and 80 and not of their own force.

It then becomes an issue of seeing if there is any capacity for those State laws to operate or whether the Commonwealth law otherwise provides, and we say that the attempt by the courts below to characterise the Commonwealth law as dealing with a different field from that dealt with by amendments under rules of court is the inappropriate - - -

GUMMOW J: That would not matter. It is the lesson of Telstra v Worthing is that that may not matter.

MR BURMESTER: That is right, it is not the right inquiry. We say that that is correct, your Honour, that is not the issue. The issue really, whether it is put in terms of repugnancy or inconsistency, is whether the State procedure rules, the amendment rules, would alter, impair or detract from the operation of section 34 of the Commonwealth Act. And whether one uses the language of section 80 or section 79, it is our submission that there is no room for State amendment rules broadly construed, construed in terms of the language used, for instance, in the Victorian or Northern Territory provisions to operate because, if they were to operate, they would be repugnant to – there would be no scope for them to operate, given the terms of section 34 which extinguishes the cause of action.

GLEESON CJ: How would section 80 potentially operate here?

MR BURMESTER: The suggestion, your Honour, is that, because in the Victorian case one is dealing with an incident in the Northern Territory and the cause of action is being heard in Victoria, that one first has to use section 80 to determine which laws apply. It seems to me, however, if one is really simply talking about the procedural ability to amend under rules of court, one is probably talking about something that is essentially the law of the forum, and that is Victorian law that would operate.

Obviously, if one is trying to reconcile two substantive provisions, then a different result may occur but it seems to me one is essentially asking whether the Victorian power to amend is able to be exercised in the face of section 34. Interestingly, the Victorian court, despite the terms of the provision under which they purported to act, read down that provision. They recognised that to amend the statement of claim to add a completely new cause of action would be inconsistent with section 34 so they read, in effect, the rule down so that it only allowed amendments where the claim had a factual base in what had already been pleaded was already before the court.

In the outcome the court felt constrained by the decision of the New South Wales Court of Appeal but they were only looking at it, essentially, through the eyes of narrow amendment power despite the words of the particular rules. We say there is scope for amendment in that narrow sense, in the sense that the Western Australian case would contemplate, in the sense that even in Proctor v Jetway there was an alternative argument put that would suffice without any need to rely on section 6. But if the proposition is that State amendment rules can displace and effectively set at nought the Commonwealth limitation, then we obviously would have difficulty and reject that proposition.

GUMMOW J: There is no conferral of jurisdiction on the Federal Court, is there, in respect of matters arising under the Liability Act?

MR BURMESTER: Your Honour, I think there now is under the general provision in the Judiciary Act about a matter arising under federal law so, yes, the Federal Court would have jurisdiction.

GUMMOW J: Yes, so one could get a different result because of their statutory power.

MR BURMESTER: Your Honour, as our submissions carefully suggest in paragraphs 46 and 47, the actual Federal Court Rules only refer to amendment where the claim “arises out of the same facts or substantially the same facts”. That is the only rule the Federal Court has and we say that
that would be consistent and able to be exercised here. If the potential to make a much broader rule – that seems to have been given in section 59(2B) of the Federal Court Act was to be used and a very broad rule was used, there would still remain this issue of how one reconciles then the two Commonwealth provisions and it may be some limitations, like Trade Practices Act limitations which are not the extinguished type, may lead to a different result from those like this. But we say that, on the basis of the Federal Court Rules as they are, one can get the same result if the matter is brought in the Federal Court or if it is brought in a State court.

GUMMOW J: The paragraph you are referring to I think is section 39B(1A)(c), matters “arising under any laws made by the Parliament” that are not criminally flavoured.

MR BURMESTER: Your Honour, the written submissions both of the Commonwealth and the States in particular go on at some length about the appropriate test under section 79 and whether there is a difference between inconsistency or repugnancy under section 79. It is the Commonwealth’s submission that whichever way one approaches it, and while as a matter of strict analytical appearance the section 79 test clearly is distinct from section 109, though as a matter of strict analysis there, they are not the same, they are dealing with different situations. Nevertheless, the outcome, if not in all, in nearly all cases will be the same - - -

GUMMOW J: It all comes down to the word “extinguish”.

MR BURMESTER: It does come down to the word “extinguish”, and we say if, as the international jurisprudence would support, if as the courts below seem to have in a sense accepted that it really is one of the David Grant-type extinguishments, then we say there is no scope for the State amendment rules to operate, and we would on that basis disagree with the proposition put in paragraph 17 of the Western Australian submissions, that adopting a different approach between section 109 and section 79 may produce different results in many cases. We would say that could not be the outcome. That would be to give section 79 an operation, in effect, which clearly would be different from that which was intended.

Section 79 was intended to pick up State laws but not to, as it were, alter the operation and effect of an existing Commonwealth law. It was essentially to fill gaps and we say you will not reach a different result in all cases or nearly all cases. Your Honours, I do not think there is anything further I need to elaborate on in oral submissions unless there are further questions.

GLEESON CJ: Thank you, Mr Burmester. Yes, Mr Jackson.

MR JACKSON: Your Honours, may I go first to the Commonwealth law, the Civil Aviation (Carriers’ Liability) Act and to Part IV. The point which I am seeking to make in relation to it is that the provisions of Part IV use the language of litigation, the language of courts, and that when one is speaking about extinguishment in section 34 if an action is not brought, then it is inevitably talking about how actions are brought in courts, and in circumstances where a large number of courts in Australia having different approaches to such matters will be the subject of the federal jurisdiction.

Could I take your Honours first to section 28, and your Honours will see that it speaks of liability. It speaks of a liability:

for damage sustained by . . . death . . . or any personal injury –

your Honours will have seen, if I could note in passing, that in the present case one of the claims in the statement of claim in Air Link was for damages. It is a claim for damages.

Your Honours, if one goes to personal property in section 29(1), the liability in respect of luggage, your Honours will see in section 29(1) the use of the phrases, “damage sustained” or “loss of” or “injury to baggage”, the use of, “unless the carrier proves”, a similar phrase, “if the carrier proves” in subsection (3). In section 29(4) there is a reference to “negligence of the passenger”, and in section 29(5) a reference to joint and several liability.

Your Honours, if one goes to section 31(1), it speaks of there being a limitation on liability. I am not looking at the heading and saying that, your Honours. What I am referring to is that in the first part of subsection (1) the liability is limited to – and your Honours will see the amount specified. Your Honours, I will come back to section 34 in a moment, but could I go first to the provisions following it.

If one goes to section 33 first of all you will see in section 33(3) a reference to a “right to bring an action against a servant or agent”. Then, your Honours, if one goes to section 36, it is the equivalent in cases of personal injury to the terms of section 35(2), dealing with death cases. If one goes to section 38 dealing with the method of calculation of the damages, because, of course, your Honours, one does not get $500,000. One gets an amount up to $500,000. One sees in section 35 in respect of death the limitation of damages in subsection (2). One sees in subsections (3) and (4) references to the liability being enforceable. One sees in subsection (6) of an “action to enforce the liability” and that - your Honours will see also the words there “only one action shall be brought in respect of the death of any one passenger”. Subsection (7) speaks of the “damages recoverable in the action” and subsections (8), (9) and (10) speak specifically of courts.

If one goes then to section 38 your Honours will see references to the manner of calculation of damages, and then section 39, dealing with contributory negligence. Your Honours, the reference to “Contributory negligence” indicates really that the reference to negligence in the statement of claim in this case was something that was premature in the sense that the issue may never have arisen. It did not in fact because of the – there was no pleading of contributory negligence in the defence, but negligence is not entirely out of the question in this class of action.

Now, your Honours, the provisions to which I have referred use the language of litigation. If one goes then to section 34 what your Honours will see that it extinguishes the right to damages, “if an action is not brought . . . within two years” from the later of the dates referred to in the provision. “Brought”, your Honours, the similar provision, is also in section 35(6), the expression “brought”, and section 33(3) refers to the “right to bring an action”.

Now, your Honours, the Act does not itself, however, make any provision for determining how an action is brought for the purposes of section 34, nor does it contain any provision itself determining the courts in which such an action may be brought.

Your Honours, that is provided for and necessarily provided for, in our submission, by the provisions regulating courts in which jurisdiction might be vested or invested in accordance with the Constitution, and that might be either a federal court or a State court or a court of the Territory.

If one leaves aside for the moment the courts of the Territories, jurisdiction has been vested in the Federal Court, and your Honours a few moments ago there was a reference to section 39B(1A)(c) of the Judiciary Act. Now, your Honours, if I could pause at that point, it is apparent, it is submitted, that the Federal Court would be in a position to make orders having some effects without going into the exact ambit of the power, would have power to make orders having some effects along the lines of those made by the Court of Appeal, to put it shortly, in the present case.

Your Honours have seen the provisions of section 59(2B) of the Federal Court of Australia Act and there is a reference that is dealt with by the Federal Court rules in Order 13. Now, your Honours, the fact that the Federal Court has powers of that kind rather militates, in our submission, against the view that section 34 is dealing with the position in a way which excludes the operation of other laws.

Now, your Honours, it is not only of course in the Federal Court that a claim for damages under the Act might be brought, because section 39(2) invests State courts with federal jurisdiction, that jurisdiction or the jurisdiction that is so invested includes jurisdiction in section 76(ii) matters under the Constitution, and, your Honours, the effect of section 39(2) is that the State court had federal jurisdiction in this matter.

If one looks at what that means for relevant purposes, is that one looks to sections 79 and 80 of the Judiciary Act to see what State laws adopted as Commonwealth laws are applicable. Now, your Honours, if the section 80, section 79 question is one of some interest no doubt in an ongoing sense, but may we say in relation to it just this, that if one goes first to section 80, the opening words of the provisions are satisfied in that the terms of the Commonwealth Act do not themselves determine when an action is brought.

Your Honours in terms of section 80 – your Honours I am sorry, I was looking at the Constitution for a moment. If I could go to section 80 of the Judiciary Act, the terms of section 80 commence by saying:

So far as the laws of the Commonwealth are not applicable or so far as their provisions are insufficient to carry them into effect . . . the common law in Australia as modified by the Constitution and by the statute law in force in the State or Territory . . . shall, so far - - -

GLEESON CJ: There is nothing in the common law that tells you when an action is brought , is there?

MR JACKSON: No, I am going to say, your Honour, about that that the part of it to which that particular part might apply would be the ability of courts under the general law to, in effect, backdate amendments. That is the only point, leaving aside the question of any change for the moment, I will refer in a moment, your Honours, to the suggestion in the reasons for judgment in the number of cases that the ability to amend carried with it the effect that subject to any other order, then the amendment dated back to the time when the original document was filed.

Your Honour, that is the simple point I want to make there. What I am going to say, your Honours, is that the New South Wales statutory law does make provision, and that is provided for by Part 17 of the District Court Rules. I will come to those in a moment, if I may.

If one goes then to section 79, it would say that, “The laws of each State or Territory, including the laws relating to procedure” are binding unless the Constitution or laws of the Commonwealth otherwise provide. Now, your Honours, the only possible Commonwealth law, in our submission, is section 34. It does not, in our submission, deal with the topic in a way which otherwise provides because section 34 speaks of two things. One is that it says that the right is extinguished, that the condition of extinguishment is that the action has not been brought within that time.

That aspect of it, the bringing of the action, is one which is not dealt with by section 34 itself. To find what that means one has to go to the Acts and rules dealing with the courts on which the federal jurisdiction is conferred or in which it is invested. Your Honours, that is why the terms of section 34 are capable of having an ambulatory effect; ambulatory in the sense that they may operate differently, depending on the jurisdiction in which the proceedings are instituted. Nothing very surprising in relation to that, your Honours. One sees that in the Leeth v Commonwealth observations to that effect in relation to the criminal law in the Commonwealth.

Your Honours, if one looks at the tests that were referred to in Northern Territory v GPAO [1999] HCA 8; (1999) 196 CLR 553 at 588, paragraphs 80 and 81, Chief Justice Gleeson and Justice Gummow and your Honour Justice Hayne I think agreed with this, your Honours will see in paragraph 80 reference to “The objective of s 79”, and then about six lines into the paragraph:

Seen in that light, the notion of “inconsistency” involved in the phrase “otherwise provided” in s 79 is akin to that first identified by Mason J in . . . Metwally . . . This is the need to resolve the problem that arises by conflict between conflicting statutes having the same source. The law of a State or Territory which is to operate as a surrogate law of the Commonwealth is to be measured beside other laws of the Commonwealth.

The issue . . . may be approached by asking whether the operation of the former so reduces the ambit of the latter that the provisions of the Family Law Act are irreconcilable with those of the Territory law, with the result that the Family Law Act “otherwise provide[s]”.

Now, your Honours, the situation which emerges from that, in our submission, is that if one looks at section 34 itself it contains the two elements; one element being extinguishment, the other being the condition of extinguishment, being that the action has not been brought. The latter of those is something that, to identify the nature of which one needs to go to the court in which the proceedings are brought or it is contended should have been brought.

Your Honours, that is why of course one starts with the Commonwealth statute. The Commonwealth statute picks up, if I can use that expression, as Commonwealth law, the law of the court in which the proceedings are or should have been instituted. Your Honours, it is inherent in the nature of section 34, in our submission, that provisions of other laws will have to provide the means of determining when an action is brought.

Now, your Honours, I gave a reference a moment ago in passing to the fact that the Commonwealth laws may well operate differently in different States, of course. The particular passage was Leeth v Commonwealth [1992] HCA 29; 174 CLR 455 at 467. I do not think it is on our list, your Honours. That is the starting aspect of it.

One then comes to the terms of the State law and could I deal with its application to the particular case. Your Honours, the statement of claim contained a claim for damages. Your Honours will see that if I could go to the relief claimed in it which is set out at page 3. Paragraph 12)(a) says “the Plaintiff claims” damages. The nature of the right given by section 28 is a right to damages. That is the nature of it. Your Honours will see, also, that as section 28 says, it arises where the passenger has suffered personal injury:

resulting from an accident which took place . . . in the course of –

relevantly, the operation of disembarking. Those facts are pleaded if one looks at the particular case at page 2, paragraphs 3) and 4).

There was then pleaded a ticket which showed that the contract of carriage was between a place in a State and a place in another State. Your Honours will see in page 3, paragraph 8):

Further, and or in the alternative . . . the Plaintiff purchased from the Defendant, through its agent, Qantas Airways Limited, ticket number 4463500449, including for the [Plaintiff’s] flight 648 –

and so on. Then, your Honours, one sees, if one looked at the terms of the ticket, it was apparent that section 28(4) was one that was applicable. One asks then, why was it necessary, in circumstances of that kind, to plead that the defendant was either the holder of an airline licence or of a charter licence and may I say, your Honours, in relation to the issue raised by your Honour Justice McHugh, may we ourselves investigate that a little more closely and give your Honours a note about it tomorrow, if I might, as I do not expect to be speaking at that time tomorrow.

If one assumes that that is an element of the right to sue, it does not follow at all, in our submission, that that was something which it was necessary to plead. Your Honours, in that regard, could I go to Part 9 rule 7 of the District Court Rules and that is a provision, not unusual, which, to put it shortly, says that it is not necessary to plead conditions precedent, they are deemed to be implied.

McHUGH J: But, Mr Jackson, do the rules have anything whatever to do with it? Is it not a question of whether determining for the purpose of section 34 if an action is being brought for damages under Part IV?

MR JACKSON: Your Honour, that is what I am dealing with, with respect. The question is, what I have said so far, your Honours, is that the facts that have been pleaded are ones which attract Part IV. They attract Part IV because one is in a situation, your Honours, where by statute, the only liability of a person engaged in the business in which the respondent was engaged, was a liability which arose either under Part IV if it was interstate or, to exactly the same extent and for exactly the same amount out of exactly the same facts, if it arose under the State law.

McHUGH J: That is the dilemma, is it not, that you have to show that it is under federal law?

MR JACKSON: Well, your Honour, to the extent to which it is necessary to do that, that is done by pleading, as is in I think paragraph 8, that the carriage was part of the carriage for an interstate movement. And I appreciate it is done briefly by referring to the ticket, but if one were to set out the terms of the ticket in extenso, it surely would not be necessary to use the words “interstate trade”, for example, or “trade and commerce” or “between a place in a State - your Honour, if the issue were to arise for - - -

McHUGH J: You still have the problem of showing that Air Link or Hazelton was the holder of a licence under this Act even if it was interstate carriage.

MR JACKSON: That is what I am saying. Your Honour says it is a problem. Is it a problem? That is why I was referring to Part 9 rule 7 which says:

Where it is a condition precedent necessary for the case of a party in any pleading that . . .

(c) a state of affairs exists or existed at some time –

and there are various other matters there referred to, then it is to be in effect implied in the pleading.

McHUGH J: As I rather indicated a moment ago, my difficulty is that it seems to me that section 34 is to be determined objectively and not by reference to what is in rules of court as to how you plead something.

MR JACKSON: Your Honour, if that be so - - -

McHUGH J: You have to be able to identify an action for damages under Part IV.

MR JACKSON: Yes, an action which pleads facts which fall within section 28 and which are facts which would arise in relation to trade and commerce or flights between one State and another and which would prima facie attract the operation of Part IV are ones which, in our submission, it would to the extent that may be necessary - and perhaps I can come to that in just a moment - are sufficient in circumstances where the court in which the matter is instituted is one the rules of which do not require one to state conditions which are precedent.

GLEESON CJ: The argument against you, as I understand it, is that it is not enough to direct attention to paragraphs 2), 3) and 8) of the statement of claim. You look at the whole statement of claim and you find that this is an action at law for common law damages for negligence or for damages for breach of contract. In other words, the argument against you rightly or wrongly is that you cannot characterise the claim for purposes of section 34 simply by looking selectively at two or three of the facts that are alleged in the pleading, that if you look at the whole pleading, the claim is properly characterised in the way I mentioned.

MR JACKSON: It becomes a question of no doubt how one looks at the matter, but could we say in relation to that that one is dealing with persons who are alleged to be carriers in Australia. When I say “persons” I am speaking generically - airline carriers in Australia. Throughout Australia there are two laws relevantly. One is the Commonwealth Carriers’ Liability Act which deals with trade and commerce and international and so on affairs, and includes Part IV. The other in the case of each State is an Act which has exactly the same name but a different year. Each of them has provisions in the terms of the New South Wales Act, your Honours have seen, has - each of them creates a liability in exactly the same terms.

Now, our learned friend’s argument would have the effect that if one put the title of the wrong statute there, and put the wrong year, then the proceedings would be no good. You could not amend them afterwards because you had not started proceedings under the Commonwealth Act, and they would be arguing that misnomer provisions were not effective against section 34. If the position was that you put no year beside the name of the Act, then it would be said that you had not attracted the Commonwealth Act.

Your Honours, that is one aspect of it. The other aspect we would seek to say is certainly one sees that the statement of claim is one which speaks in terms of negligence, it speaks in terms of breach of contract, but at the same time it contains a claim for damages. It is surplusage, no doubt, to say that the entitlement arose because of breach of contract. Whether it did or it did not did not matter very much, but the pleading of the facts sufficient to bring in the Commonwealth Act is there, in our submission. But if it is not, your Honours, it then becomes a question of whether the proceedings are a nullity, and under the State law they would not be.

McHUGH J: No, but let it be assumed in your favour that the way Mr Margo put his case cannot stand, but your argument, it seems to me, would be equally as good if the issue was whether you were suing under the State Act. The problem I see at the moment is without some linking to this licence under the federal Act, your action could be under either statute.

MR JACKSON: It would not mean that it would be bad under either.

McHUGH J: I know that, but your problem is that you have to show this was a federal statute.

MR JACKSON: Your Honour, that assumes, if I may say, so to speak, two things. One is that the reference to the ticket does not. The second is that one cannot take into account the provision of the District Court Act which says that mistakes in – to put it shortly – non-compliance with a provision, say, of the rules or some other respect in commencing proceedings does not nullify the proceedings, so that proceedings have been brought. The other aspect of it is that one looks to see, with respect, where ultimately the requirement to show on the face of the document that the proceeding is under section 28 comes from. Now, your Honours, no doubt, the - - -

GUMMOW J: You say the ticket enlivens 27(4)?

MR JACKSON: Yes, your Honour, yes, I do.

GUMMOW J: The Dubbo/Cobar enlivens 27(4) and then the fact that the carrier might have only had a State licence would not matter because it would be within the definition of “charter licence” for the reasons we have been talking about?

MR JACKSON: Yes, your Honour. Could I also say if one were to look at this from a different point of view, at this stage – at the start of proceedings, I mean - the issue of jurisdiction, federal law or not, does not arise commonly except in slightly unusual cases. If one took, for example – and it may arise in cases where proceedings have been given to the Federal Court and the court has not got to it, things of that kind, but leaving aside really Chapter III issues, the question which could present itself might be if it were sought to apply directly to this Court for special leave under section 39(2) in a case where the statement of claim said only this, but there was a State provision which said, “You cannot do that.” Now, the question would be whether the statement of claim demonstrated there was an exercise of federal jurisdiction, and in a case of that kind, if one saw a ticket like this, the answer, in our submission, would be, “Yes, it is a case involving federal jurisdiction.”

GLEESON CJ: We had better get clear procedurally what is happening here. As I understand it, this issue that you are now on was resolved against your client in Air Link (No 1), and there was never any appeal from that.

MR JACKSON: That is so, your Honour, yes.

GLEESON CJ: You have, as I understand it, here an application for special leave to appeal against Air Link (No 1), although out of time.

MR JACKSON: Yes, your Honour, yes, we do. I am going to deal with the procedural aspects, including that, in a few moments if I may, but the issue was decided against us and, of course, we submit, incorrectly.

GLEESON CJ: As I understand what Justice Sheller said in Air Link (No 1) on the matter that you are now on was that this is a fault-based claim that is made here and on its face is not a claim under the system of no-fault limited liability provided by the Commonwealth statute, and he used words like “stripping away allegations of negligence and breach of contract”. He said you cannot do that.

MR JACKSON: Yes. Your Honour, as to the second part of that I accept what your Honour says. He did say that. Some of his Honour’s observations reflect I think the first part of what your Honour said to me, but could I just say that – if I could go directly to that. The defects which were held in Air Link (No 1) to exist were defects relating to non-compliance with the rules. There were two respects. One was that there had not a statement of the cause of action in compliance with Part V Rule 6A – you will see that at page 64 of the appeal book, paragraphs 16 and 17. That was the first thing.

The second thing was that there was not a sufficient statement of the material facts. That is at paragraphs 18 through to 22, the reference to “strip away” at the top of paragraph 21. Now, in dealing with that, his Honour refers rather curiously, with respect, in paragraph 19 to the rule of taking by surprise. We would say it would be extraordinarily difficult to see how the airline could have been taken by surprise because it was liable under either the State Act or the Commonwealth Act for the same conduct, same damages and for the same amount under a provision in exactly the same terms.

KIRBY J: That assumes that the test is taking the airline by surprise, but the submission has been put that it is a more objective test, that it imposes an obligation to bring an action and by definition an action on the cause of action under the statute.

MR JACKSON: Your Honour, that - - -

KIRBY J: That is what we have to resolve, and there is some international jurisprudence based on the Convention that seems to give that support, and some of the travaux seem to give it some support. This was 1929, this Convention.

MR JACKSON: Could I just say in relation to that first of all, my reference to “surprise” was to say, with respect, that one might be a little surprised at the use by Justice Sheller of the surprise rule in the passage at page 64 because it is difficult to see how one could be surprised. One might not know which of the two it was. That is the highest one can put - - -

KIRBY J: If it is a surprise rule, you win as far as I am concerned. But I am just asking why one would take such an objective rule for airlines of all sizes and all shapes all around the world in the Convention and import that into our statute and have a single common test in section 34. It does not seem the way you would read the section or the Convention.

MR JACKSON: Yes. Your Honour, could I just say in relation to section 34 that section 34 is of course domestic law, and whilst no doubt in relation to the domestic law one looks at it in circumstances where there are provisions to similar effect in the various Conventions, but each of the Conventions has in its Article 29 the second provision dealing with courts and what courts can do. Now, a relatively narrow view has been taken of that, although not exclusively. But one is in a different situation in Australia because the jurisdiction which is created by it is federal. Now, federal jurisdiction can be exercised by the Federal Courts or courts of the State. Now, when that happens, unless the Parliament makes other provision or makes it clear it is making specific provision, then section 79, for example, would pick up the relevant procedural laws of the States.

Your Honour, I use procedural in the larger sense of the term, but section 79 is not in terms limited to just the procedural laws in a narrow sense so it is right to say that one may look at the international jurisprudence, but they do start from two different points of view, with respect, and the Australian point of view is one that is an exercise of federal jurisdiction being exercised by courts which have their own rules and their own approaches.

KIRBY J: But the problem with that logic is that that would mean unless you have a differential interpretation of section 34, that we would be out of kilter with the rest of the world in the interpretation of that section as it applied to international flight. That does not seem to be either (a) what the Parliament has provided, (b) what the Convention would have contemplated, and (c) what would be a rational way to read the whole together.

MR JACKSON: Your Honour, if one looks to see the people to whom Part IV would apply, if one is talking about international flights, ex hypothesi, there are people who are not parties to the Convention, because one sees the concluding words of section 27(1), and no matter how much one might like to make things comfortable for them, if they choose not to join the Convention then they can hardly complain because Australian law is interpreted by Australian courts in Australian ways, if they fly here.

KIRBY J: But most have and we certainly have.

MR JACKSON: We have the Convention, we apply the Conventions. When the Conventions apply, we apply them. Otherwise, it is a matter of Australian domestic law. The point I am seeking to make - - -

KIRBY J: Yes, but we did learn in the Povey Case in the submissions there which gave us a very good background in this Act, of the great effort that is made in the international community and throughout the United States with its huge civil air aviation industry and the United Kingdom and countries all around the world, to have a common approach to the Convention and that is what I am anxious not to undo, if possible.

MR JACKSON: Your Honour, this is hardly undoing things. There are proceedings in being, there were proceedings in which the nature of the flights of which this was part was set out. That obviously attracted the terms of section 28 and all that has happened and I should say, your Honours, the only things that were wrong, if I could use that expression, with the original pleading was that it did not contain on the highest view of it some aspects which the rules may have required.

But, your Honours, one has to treat the defects, if I could use that term, as defects which themselves occur in a situation where one has the Act pursuant to which the rules were made, that is, the District Court Act which contains the terms of section 159 and section 159(1) said specifically:

Where, in the purported commencement of any proceedings or at any stage in the course of or in connection with any proceedings, there is, by reason of anything done or left undone, a failure to comply with any requirement of this Act or of the rules whether in respect of time, place, manner, form or content or in any other respect:

(a) the failure shall be treated as an irregularity and shall not nullify the proceedings, or any step taken in the proceedings, or any document, judgment or order in the proceedings - - -

KIRBY J: But that cannot be used surely, to rewrite section 34 if, by virtue of its application of an international treaty, it has a different meaning. You cannot pick up the District Court Act (NSW) and revise the whole body of international rules that have been established in the civil aviation industry.

MR JACKSON: I am not attempting to, your Honour.

KIRBY J: Constitutionally, you cannot.

MR JACKSON: Section 34, your Honour, is not part of a treaty. It has nothing to do with a treaty.

KIRBY J: No, but it is designed to give effect to the Convention.

MR JACKSON: Your Honour, it is designed to, so far as Australia is concerned, make provision rather similar to that contained in those treaties. It does not do more than that and it contains within itself, when it speaks of action being brought, reference to the courts in which proceedings are brought. There is no other way, with respect, of determining whether the action has been brought other than by looking at the proceedings of the courts that deal with such actions.
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Your Honours, if one goes to the District Court – I will come to that in just a moment – but if one were to take the case of the simple form of general endorsement under a writ and if the plaintiff were to say in the general endorsement, the plaintiff claims damages because of injuries sustained when leaving a flight at Cobar, for example, or Dubbo, it would not appear from that that there was directly a claim being made under that Act but it would be difficult, in our submission, to say that that was not something that was the bringing of an action for the purposes of section 34.

It might not say a word about that Act at all. The nature of it would appear later, let us assume after the limitation period had expired, when the statement of claim was delivered. I was going to say in relation to section 159, if one makes the assumption, which is of course part of our submission, that the method in which proceedings are to be brought in terms of section 34 is something that is dealt with by the law of the Court in which they are brought then our submission is that one takes the nullity - the section 159 into account as much as any other provision. That is part of it.

Your Honours, could I come then to say something about the state of proceedings in the District Court. Your Honours will see, and I just wish to attempt to clear up something in relation to them, the defence which your Honours will see in page 4 had raised as an answer the contention which is in paragraph 13 and that contention was based on paragraphs 8 to 12 of the defence and then there was a further contention which was in paragraph 14 at page 6. We then applied, as you will see from page 7, for two things, the first being that paragraph 14 be struck out, and secondly, for leave to amend as per the document at page 27.

The proceedings came before Judge Black together with an application by the airline that the proceedings be dismissed – your Honours will see that at page 35 with the relevant notice of motion on the part of the present appellant being at page 8.

Now, your Honours, the orders made by Judge Black are at page 46. You will see that he ordered that:

Paragraph 14 of the Notice of Grounds of Defence be struck out.

He made no order in relation to our application for amendment, and he dismissed the Notice of Motion made by the defendant. You will see that in his reasons at page 45 line 15 as well.

Your Honours, you will see then an application for leave to appeal to the Court of Appeal made by Air Link at page 47 and it did not seek leave to appeal from the dismissal of the motion to dismiss our proceedings. What remains a little unclear from the orders and decision of the Court of Appeal in Air Link (No 1) is in a sense what actually was done. You will see at page 63 in paragraph 14 that there is a reference in the last sentence to:

from that decision that this application . . . for leave to appeal comes.

That seems to deal with them globally. At page 71, paragraphs 33 and 34, the orders made by Judge Black are set aside, but that cannot be, for example, order 2 – I am sorry, your Honour, the formal order is on the next page, page 72. It seems clear that the proceedings were dismissed, because otherwise the amendment question would not seem to have arisen and, thereafter, there was the application for leave to amend which you will see at page 73.

GLEESON CJ: Those orders on 72 are the orders made in Air Link (No 1)?

MR JACKSON: Yes, your Honour. The application for leave to appeal was not in relation to the defendant’s motion to dismiss the proceedings. The orders seem to go a bit more widely but our submission is that they did not cover that.

Your Honours, there are two other matters with which I wish to deal. One was the question whether the rule itself is within power, and the other is to say some further things in relation to our application for special leave. May I deal with them in that order. The power to make rules of the District Court is vested in the Rule Committee which is established by section 18A of the District Court Act. The rulemaking power is found in section 161. Section 161, not unusually, contains both general and specific provisions. The general power is not uncommon again with rules of court in broad empowering terms, and could I refer your Honours to section 161(1).

If one goes to the first dot point in section 161(1) it empowers the making of rules for or with respect to any matter:

by this Act . . . is required or permitted to be prescribed by rules –

Now, your Honours, pausing at that point, section 53 of the Act to which reference was made by my learned friends earlier this morning, is the provision that says:

An action and proceedings ancillary to an action shall be commenced in the manner prescribed by the rules.

Your Honours, that makes it clear that the power to make rules of court includes power to prescribe when and how proceedings are commenced and, in our submission, to prescribe the circumstances in which amendments may be made to proceedings so commenced.

If one goes, your Honours, to the second dot point in section 161(1) and also to the terms of section 161(1)(a); that is, rules – looking at (a):

providing for the procedure (including the method of pleading) and the practice to be followed in the Court in all proceedings in which, or with respect to which, the Court has for the time civil jurisdiction, and regulating or providing for any matters incidental to, or relating to, any such procedure or practice –

then, your Honours, in our submission, there is no reason why the subject matter of the relevant rules are not part of the procedure and practice of the court.

Now, the “relation back” doctrine has been treated as being part of the procedure of courts. Could I give your Honours a reference to what was said by Justice Priestley – this is before it was changed - in Proctor v Jetway Aviation Pty Limited [1984] 1 NSWLR 166 at 182. In the first new paragraph on the page, going through to the end of that paragraph, could we refer particularly between D and E that the rules by which applications for amendments were decided were always treated as being rules of practice, and your Honours will see similar observations at page 183, the last paragraph on the page.

Could we refer too to page 173, Justice Moffitt quoting from Justice Glass in McGee v Yeomans. Your Honours will see the quotation there, a reference that Weldon v Neal was a “rule of practice” and so on. Could I refer also to what was said by Justice Mason in the present case at page 160, paragraph 50 and page 164, paragraphs 60 to 64.

GLEESON CJ: Mr Jackson, one of the things that is troubling me is that the actions of the kind referred to in section 34 would often include actions for very modest amounts of money, particularly when you are dealing with baggage claims, and I would have guessed that the probabilities would be that in many of those cases the claim for compensation, if I can use that expression, in respect of lost or damaged luggage would be a claim brought in some kind of small claims tribunal by a person who would not have the faintest idea of the liability regime under the Act or at common law.

MR JACKSON: That is very likely, your Honour. If we give in a sense an extrapolation of what your Honour has put to me, let us say that the baggage handler at Dubbo or Cobar makes a mistake and the trolley somehow gets away and goes into the river if the rivers are running, so that all the baggage is lost. The owners of the baggage or the passengers, some of them will be persons to whom the Commonwealth Act applies, some will be persons to whom the State Act applies. Now, your Honours, it would seem to be an extraordinary thing, with respect, not just the movement of the noise of the chains of the old forms of action, of which I know some of your Honours are not unhappy with, but the.....are really rattling them if the position were that the actions failed because no one noted the State Act or the federal Act or got it wrong in which one they meant.

Your Honours, that seems, with respect, an extraordinary result. Even with passengers, if there were an air crash in which a number of people were killed – and there have been rural air crashes in the last 10 or so years in which people have been killed – some of them would be persons who fall within the Commonwealth Act, some within the State. It really seems a strange thing to require that – and it really must come down to saying that either the words of the heading of the Commonwealth Act have to be used or that in some way it must undoubtedly refer to the Commonwealth Act - - -

McHUGH J: But what you have to show in this case is that as at 25 September 2000 there was on foot an action for damages under this Part. Now, you might be able to identify that because somebody stood up in court, in the District Court, the day before September 25, 2000 and said, “This action is under Part IV of the Act”. Maybe that would be sufficient to identify it, but whatever the rules say, section 34 seems to require identification of a cause of action under Part IV.

MR JACKSON: With respect, your Honour, that is not what the words actually say, of course. What the words say is that the right is extinguished “if an action is not brought by him or for his benefit”.

McHUGH J: “An action” there must mean an action for damages under this Part. It cannot be talking about action in the abstract.

MR JACKSON: No, no, your Honour, one is not. But if one is speaking about the action, it is an action in respect of – to put it loosely – the right of a person to damages under this Part. Now, if one looks to see then how the right to damages arose, you go to section 28, and if what you have is a pleading, as here, the person suffered damages because of something that happened in connection with a particular flight, uses the words in effect of section 28, and then indicates facts sufficient by reference to the ticket to show that the flight is within this Act, why does one need any more - - -

McHUGH J: You do not. The question is whether the facts are sufficient. What is troubling me at the moment is this question of the holder of the licence.

MR JACKSON: Your Honour, I will endeavour to do something about that, endeavour to put into writing what we are saying. If that is the point that is troubling your Honour, the question which arises is why is it necessary? Now, if the position be that in relation to a court in which a claim of this kind can be made, the making of that allegation is one which is not necessary under the rules of that court, and for it not to be made in accordance with the rules of that court would not invalidate the proceeding in that court.

McHUGH J: No, it does not invalidate proceedings in the court at all.

MR JACKSON: No.

McHUGH J: But it may be that there is no action brought for the purpose of section 34.

MR JACKSON: Your Honour, it would seem strange if, in a court in which jurisdiction was being conferred under section 39(2), you have a situation where to bring an action you do not have to comply or you have to not comply with the rules of that court. That would seem curious, with respect.

GLEESON CJ: One thing we know is that people can invoke federal jurisdiction without realising they are doing it and judges can exercise federal jurisdiction without realising they are doing it. In that litigation about Golden Lights Tobacco, Mr Justice Helsham said that if he had realised he was exercising federal jurisdiction he would have got a white car to work every day. The international jurisprudence to which we have referred does not touch this problem that we are concerned with, does it? It is dealing with tolling limitation periods, extending limitation periods because of infancy or disability or something like that.

MR JACKSON: Your Honour, I think the closest case may be the Qantas Case to which my learned friend referred, but the facts of that are of a particular kind, in our submission.

KIRBY J: But the talk of tolling is the language of precision and accuracy and the bringing of the action. It tends to suggest that it has to be done at a particular time and clearly in order to conform to the purposes of the Convention.

MR JACKSON: Well, your Honour, as to the first of those things, at a particular time, yes, there is not much doubt about that. Clearly must be a question of degree.

KIRBY J: As you say, you could leave off the year of the statute or.....along that spectrum. If you leave off the year or you misname the statute or you do not put some aspect of the statute in, you are put out of court.

MR JACKSON: Your Honour, it would seem, with respect, absolutely ridiculous if you had a situation where one had an otherwise properly pleaded claim, properly pleaded in the most pristine and perfect sense, a claim in a case like this, but nominated – it said the 1967 Act rather than the 1959 Act and did not put in - - -

KIRBY J: That is true but in this case we have a sort of very clear case where the Act was not in the draft as mimed. It is agreed that it was not in the draft as mimed and it is not identified even in a mistaken way, it is simply not identified at all because it was not what they were thinking of.

MR JACKSON: It is not referred to, your Honour, but everyone, as covering clause 5 says, is bound by the Constitution and by laws made under it. That has the effect that so far as a carrier is concerned and so far as a person being carried is concerned, their only liability or entitlement under Commonwealth law is pursuant to Part IV in relevant senses. The fact that a statement of claim refers to other causes of action which require additional things to be proved does not mean that one strikes out the whole statement of claim and there is no claim made for what can be obtained.

CALLINAN J: Mr Jackson, paragraph 10 of the defence establishes that this was a ticket for an interstate journey.

MR JACKSON: Yes.

CALLINAN J: And it therefore establishes that the case, no matter what language may have been used by the respondent, was a case within federal jurisdiction.

MR JACKSON: Your Honour, and if one looks at paragraphs 8, 9, 10 and 11 of that, there is no question about it.

McHUGH J: But there is a question, is not there, Mr Jackson? It is not sufficient to say that you have a statutory cause of action arising under a law of the Commonwealth unless you also allege that the carrier was the holder of a licence under the Act. It is not good enough to say that it was an interstate journey.

MR JACKSON: Your Honour, I just want to say, if I may, two things about that, and I suspect I have said them in response to your Honour’s question before. The first of them is that it was not necessary to do so, and in terms of the requirements of the court in which the relevant jurisdiction is vested. The second thing is that one of the features picked up by section 79, in our submission, is seen in section 159 of the District Court Act which deals with the consequences of error, to put it shortly, of the kind in question.

I appreciate, of course, that one has to give effect to the Commonwealth law, but the terms of section 79 are such that they pick up and apply relevant State laws. Relevant State laws are ones that deal with how one starts proceedings and with the effect of errors in following out that method. Your Honour, I do not know that I can - - -

McHUGH J: On that argument, 34 is modified by operation of 79 or 80 and the rules of court, is it?

MR JACKSON: No, I would not use the expression “modify”.

McHUGH J: I know you would not, but that is what it comes to, is not it?

MR JACKSON: No, your Honour. That is one way of describing it but not, with respect, the better way. The better way is to say if one looks at the terms of section 34, section 34 involves two elements. One is that there is the extinguishment. The other is that the way in which extinguishment occurs is that the action has not to be brought. What that means, that latter expression, is something that can only be derived by looking at the constating documents and the regulating rules of the courts on which jurisdiction is conferred.

McHUGH J: What would you say, supposing a Local Court’s rules said an action for damages may be commenced in this court by filing a claim specifying the amount of damages claimed and naming a defendant and the cause of action can be stated orally at the hearing of the matter.

MR JACKSON: Good enough, your Honour, good enough.

McHUGH J: You would say it is good enough, even though you do not find out until the expiration of the two-year period that you are suing under this Act, the federal Act.

MR JACKSON: Your Honour, one would, with respect, have to be exceptionally stupid not to find that out beforehand. I do not mean your Honour, of course.

McHUGH J: Not necessarily. I mean in this particular case you file your statement of claim two days before the expiration of the two years.

MR JACKSON: Yes, and your Honour - - -

McHUGH J: Well, the two years is up and no one knows at the end of two years what your cause of action is. It is just a claim for damages against Air Link.

MR JACKSON: No, it is a claim for damages because we were injured getting off the plane at a particular place whether you are flying with a particular ticket - - -

McHUGH J: I know, but let us assume you have none of that detail in that - you just have to issue a writ to start your cause of action and at the hearing you can state orally what your claim is and you make your statement at the end of the two years. Now, do you have an action for the purpose of 34?

MR JACKSON: Yes, you have, and, with respect - - -

McHUGH J: Even though as at the expiration of the two years you did not know what your cause of action was, except in your mind?

MR JACKSON: The situation would be there is a claim for damages. Now, the claim for damages of its nature is being made against a carrier, so that is the starting point, being made against the carrier. If the carrier chooses to find out no more about it that is its bad luck, but the action has been brought.

GLEESON CJ: It is the rules of court that tell you whether an action has been brought, and if the rules of the small debts court say you bring an action by filing a document, identifying the parties and stating that you are claiming damages up to a certain amount and you do not have to say anything further than that until the day of the hearing, which is very much like the way it used to operate in the District Court by the way, then the rules of court will tell you that an action has been brought.

I am just wondering whether I was right to suggest earlier that you read the words “if an action is not brought by him” as meaning if an action for damages under this part is not brought by him. The words are “if an action is not brought by him” and what is involved in bringing an action can vary greatly between jurisdictions and can often vary with the amount of the claim, and if you are dealing with a small claim in an informal tribunal, perhaps even a tribunal which forbids representation by lawyers, as is the case, I think, with some small claims tribunals, then all you have to do, perhaps, is point to the fact that an action for damages was brought, and if the objective circumstances are such that the action can only be in law an action promoting a claim under this statute, then it is satisfied.

MR JACKSON: Your Honour, could I say if one took a case of that kind, the probability would be that a statute of the State would say there can be no appeal from this body or there can only be a limited appeal – but let us assume for the moment no appeal.

GUMMOW J: That would be invalid.

MR JACKSON: I am sorry, your Honour, that is what I am about to say. What I am going to say is that such a provision would not, because of section 39(2), if it were prevent there being an application for special leave to this Court, if one could establish, let us say by affidavit, that the jurisdiction that was sought to be exercised was one which was federal, because the provision - - -

McHUGH J: I do not know that the analogy is good. Your point is undoubtedly good that you would have a special leave application. The question is still outstanding whether or not you commenced an action for the purpose of 34. It is not the same issue.

MR JACKSON: Your Honour, with respect, there would not be an ability to appeal unless the jurisdiction was federal, assuming the State law prohibited the appeal. There would not be a jurisdiction to appeal, and the only jurisdiction would be – the only ability to do so to this Court would be if the jurisdiction was federal. It would only be federal if one established that the Commonwealth law was applicable, or claimed under it. That might be capable of being proved by facts which had not yet been apparent in the Court.

KIRBY J: I thought I heard Mr Margo say that in a case where all you had to do was file a writ or where you had a proceeding in the Small Claims Court and that was a court of the kind that we have been talking about, then that would be the only way you could bring that action in that jurisdiction. But the problem, it was suggested, for you is that in the Supreme Court, or in a District Court, you have to give greater particularity and that you read that as the background against which one then reads the federal statute and the requirements in the particular case.

MR JACKSON: Your Honour, that proposition of my learned friend’s is one that contains within itself inconsistencies - if I may say so, with respect – and it does so because the starting proposition is that if the rules of the court or the procedure of the lower court, let us say, allows you to do it in a simple fashion, that is okay. When you come to another court which requires there to be particulars stated, you have to comply with the particulars. What it leaves out of account is that the rules and statutes governing courts are a complex of things. There may be ones that say you have to plead this or that, but there are others saying it is not a nullity if you do not.

GLEESON CJ: But the rules also include rules saying you can fix it up.

MR JACKSON: Yes, your Honour.

McHUGH J: Your theory of the section certainly would have created some problems in New South Wales between 1959 and 1970, because in New South Wales you could issue a writ, you did not have to serve it. You could renew it, I think, as of right every 12 months, so you could have gone on for years without serving the writ and filing your declaration, in which case the carrier would never know until years after the accident that there was a cause of action.

MR JACKSON: Your Honour, one could have done the same in Queensland for, I suspect, a very large part of that time, and the remedy in circumstances of that kind – there were several remedies. One was to apply to strike proceedings out for want of prosecution, another was that in some circumstances there would be an ability, that once there had been service, to require that leave be obtained before further proceedings be taken after the expiration of a year, say, and things of that kind. If one was served with a writ that was four years old, one would be expected to take some action to try to bring it to an end.

McHUGH J: They may be remedies that were available under the State jurisdiction but it hardly seems consistent with the policy of section 34.

MR JACKSON: Your Honour, the policy of section 34 has two aspects to it and I think I have dealt with those already. You cannot have one without the other, as it were.

GUMMOW J: Mr Jackson, the Convention draws this distinction between actual carrier and contract carrier, I think.

MR JACKSON: Yes.

GUMMOW J: When you are considering these licence provisions in section 26 overnight, could you have a look at 26(2)?

MR JACKSON: Yes.

GUMMOW J: I am not sure how that fits in. It may be that it was engaged here.

MR JACKSON: Yes, it may be, your Honour, I will endeavour to deal with that. Your Honours, could I continue with just the question of whether the rule is intra vires. I had referred your Honours to what was said by Justices Priestley and Moffitt in Proctor v Jetway Aviation and to something said by Justice Mason in the present case. If the relation back rule was a matter of practice and procedure it is very difficult, we would submit, with respect, to see why the terms of Part 17 rule 4 would not fall
directly within section 161(1) and could I refer your Honours finally on this aspect in passing to section 161(2)(ah) which allows the making of rules:

providing for the amendment of documents filed by a party to any proceedings -

Your Honours, could I come then to the question of special leave and in that regard may I refer to our summary of argument.

McHUGH J: This is a pretty fundamental point, is it not, Mr Jackson? Speaking for myself, I do not know that you need spend much time on it. I mean, to a large extent, we have been going over this ground, have we not?

MR JACKSON: Yes, your Honour. Yes, we have. It is a case where there are laws in all the States which are mirror image laws and we would submit it is an appropriate case.

GLEESON CJ: Mr Jackson, just to test the proposition. Take the simplest case of a mistake in a statement of claim that pleaded the facts necessary to give rise to a cause of action under the Commonwealth Act and then said, “And we are claiming damages under the State Act”. That statement of claim is filed two days before the expiration of the limitation period.

MR JACKSON: Yes. As your Honour said, that is a simple case. If our learned friend’s submissions are right then it is difficult to see why the – subject to particular rules, and I will indicate why I make that qualification in a moment – it is difficult to see why that would not be prohibited, if they are right because it would not have identified the making of a claim under that provision. I said “subject to particular rules” because the rules may distinguish in particular cases between the pleading of facts and the pleading of the actual claim for relief, but the ordinary misnomer, if I could use the term broadly, rules it would allow amendment. Your Honours, it is a little difficult to see how consistently, with my learned friend’s argument, they would survive and equally, of course, the cases where neither, where the Act is referred to without a year.

GLEESON CJ: Is that a convenient time?

MR JACKSON: Yes, your Honour.

GLEESON CJ: We will adjourn until 10.15 am tomorrow morning.

AT 4.17 PM THE MATTER WAS ADJOURNED
UNTIL WEDNESDAY, 9 MARCH 2005