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Accident Compensation Cases

Accident Compensation Corporation v Connetics Ltd (HC, 15/12/00)

Judgment Text

This application seeks to review the Master’s decision dismissing applications by the respondent to strike out two notices of appeal. The notices of appeal were filed by Accident Compensation Corporation (“the Corporation”), following the grant of special leave to appeal from the District Court on a point of law. Both notices of appeal relate to the same point of law. The respondent’s applications to strike out both appeals were founded on the argument that the Corporation had failed to comply with the provisions of ss 72 and 73 District Courts Act 1947 and that such failure was fatal to both appeals. 
The Master summarised the background facts to the strike out applications as follows: 
“On 11 August 1999, the appellant lodged a notice of motion of appeal with the High Court, having been granted leave to appeal by District Court Judge M J Beattie on 23 July (19 days earlier). However, due to what the appellant claims was a delay by the postal system, a copy of the notice (which is required by s 72(3) of the District Courts Act 1947 to be served on the respondent before or immediately after the appeal is lodged), was not received by the respondent until 19 August 1999. A covering letter enclosed with the notice was dated 12 August 1999. The respondent’s solicitor, as required under the High Court Rules, Rule 206A(4), advised the appellant’s solicitor by fax on 19 August 1999 that the notice had been received. 
When the respondent notified the appellant that it intended to pursue the question of whether s 72(3) of the District Courts Act had been complied with, the appellant, out of what it says was an ‘abundance of caution’, issued a fresh notice of appeal. This was filed and served by courier on the respondent on 6 October. If s 73(1) of the District Courts Act applies to this case, the appellant, in order to file a fresh notice of appeal, would have had to either done so by 13 August, or have applied to Court for leave to appeal out of time by 13 September. It did not follow either course. ”
Two essential issues arose for determination. The first was whether a requirement to serve the notice on the respondent “before or immediately after” the lodging of the initial appeal in the High Court had been complied with by the Corporation. The second and alternative issue was whether a fresh notice of appeal could be issued to comply with the prescribed time limits in s 73 District Courts Act 1947. 
The Master dismissed both applications. In relation to the first notice of appeal, he found there had been compliance with s 72(3) District Courts Act 1947 and that service was, in fact, effected within the time stipulated for service by the rules. The Master further found that even if there had not been compliance, he would have found there to be “an explanation or excuse” in terms of State Insurance General Manager v Scott [1982] 1 NZLR 717 (CA). In relation to the second issue, the Master found there was no time limit for the filing of a notice of motion on appeal in relation to an appeal by the Corporation and accordingly it was proper to allow the appeal to proceed on the second notice of appeal. 
The grounds for review 
The respondent alleges that the Master wrongly applied s 72(3) District Courts Act 1947 and also erred in finding that no time limit attached to an ACC appeal filed by the Corporation. 
In relation to the first notice of appeal, Mr McGinn submitted that the Master’s finding that an 8-day delay in this case complied with the requirement of “Immediately after” or “sufficiently immediate”, as that phrase has been interpreted, was contrary to established authority. He argued that the majority of precedents in this area indicate that if a notice of motion has not been served on the respondent within 72 hours of lodging in the High Court, then it has not been served “immediately after”. In this regard he referred to Meeks v Hull (1999) 12 PRNZ 606, 609, in which Paterson J made a similar observation. The line of authority relied on by Mr McGinn, and indeed relied upon by the Master as well, begins with the decision of the Court of Appeal in State Insurance General Manager v Scott. In that case the Court propounded the following useful test (at p 719): 
“The use of the words ‘immediately after’ in s 72(3) import a degree of urgency in the requirement of notice to the other party of the bringing of an appeal without avoidable loss of time. In the context of the section they connote expedition and promptitude so that the filing and the service following upon it become aspects of a continuing process which will be as contemporaneous as the circumstances permit. They take some added flavour from their use in an expression which is concerned with service ‘before or after’
A relatively short time of 21 days is allowed for the lodging of the notice of motion, unless leave be granted within a further fixed period, and a delay of 12 days (or at best 10 days) without explanation or excuse in the circumstances of this case which called only for delivery of the duplicate document to a solicitor practising in a neighbouring town does not in our view meet the requirements of the subsection. ”
That test was further and sensibly developed by Thomas J in Brain v Gerring Oyster Products Ltd 23/7/91, Thomas J, HC Whangarei AP5/91 to reconcile the seemingly mandatory requirement of “immediately after” in s 72(3) with the introduction of a notion of “explanation or excuse in the circumstances”. After citing a hypothetical situation service being physically impossible for a number of days, Thomas J went on to say (at p 9): 
“Other fact situations may arise which demonstrate that, notwithstanding an apparent delay, the duplicate was in the circumstances of the particular case served immediately after the lodging of the appeal. The explanation or excuse will in effect determine the meaning of those words in relation to the particular circumstances. ”
Mr McGinn submitted that the test in State Insurance General Manager v Scott of “as contemporaneous as the circumstances permit” and the hypothetical example given by Thomas J in Brain v Gerring Oyster Products Ltd, of “physically impossible to serve the duplicate on the respondents address for service until a number of days had elapsed”, did not assist the appellant in the circumstances of this case. The essence of his argument is encapsulated in the following submission: 
“The appellant took the risk of effecting service by post and the unexpected and unexplained delays following. The service rules provide an earliest deemed service date of 5 working days after the date of posting. Further the absence of prompt acknowledgment envisaged by the rules should have alerted the appellant to the problem. More reliable service options were available such as personal service by agents, facsimile or courier post. This was tellingly illustrated by the method of service adopted by the appellant in respect of service of the second appeal AP282/99 which saw service effected within 24 hours. The evidence tendered by way of excuse does not meet the threshold to overcome the immediacy test. 
Reliance on postal service in these circumstances when there was an overriding statutory requirement of immediate service, and when more prompt and reliable means of service were readily available to the appellant mean that there cannot be explanation or excuse when regard is also had to the overriding mandatory consideration interpreted by the Court of Appeal as meaning as contemporaneous as the circumstances permit. ”
Essentially Mr McGinn’s argument was that if the Corporation elected to effect service by mode of the “inherently risky” postal service and thus fell foul of the s 72(3) time requirements for service, no plea of permissible contemporaneity or excuse through physical impossibility could be called in aid. 
Mr McGinn did accept, however, that if the Court found that postal service, as provided for in rr 192 and 206A High Court Rules, was permissible as a mode of service for the purposes of s 72(3) District Courts Act 1947, then service effected within the time prescribed by the rules would satisfy the requirements of s 72(3). 
The Master found that the postal service was a sufficiently urgent mode of service in the circumstances of this case and that service had, in fact, arguably been effected within the time stipulated by r 206A. His findings in this regard are as follows: 
“Corporation and Connetics had used the postal service to serve documents on each other from the time Connetics filed its appeal in the District Court and had done so without difficulty or complaint. Further section 72(3) does not rule out service by post and so that method of service was available to the Corporation pursuant to r 192. having regard to r 206A, I think it is very arguable that service was effected within the time stipulated by that rule. I say that because rule 206A(a) stipulates that service of a document shall, if posted to a Post Office Box number, be deemed to have been duly served on the earlier of: 
The fifth working day after the day on which it was so posted; or 
The day on which it was received . . . 
The 14th and 15th of August 1999 being a Saturday and Sunday, in terms of (i) above, service it seems would be deemed to have been effected on 19 August 1999 and thus within the time contemplated by the rule for postal service. In my view therefore, it is very arguable that there has been no breach of s 72(3) but if there was, it occurred through the fault of a third party (the postal service) thus entitling the Corporation to rely on the latitude allowed by the Court of Appeal’s judgment in State Insurance v Scott (ie ‘explanation or excuse’). ”
Mr McGinn did not refute the Master’s computation of time and accepted, on the above analysis, that postal service had been effected within the time prescribed in r 206A. 
The Master then went on to determine as follows: 
“I am not prepared to hold in the circumstances of this case, that the notice was not served before or immediately after the lodging of the appeal. Further, as no prejudice has been demonstrated by the respondent, I also apply Zhang and Westpac v Foulds to refuse to strike out the appeal. ”
In relation to the latter aspect of prejudice, Mr McGinn submitted that the Master had erred in seeking to apply the reasoning in Zhang v Zhang (1998) 12 PRNZ 542, as the concept of consideration of prejudice was, he submitted, wrongly introduced into the jurisprudence by Cartwright J in that case and was out of step with the authorities. 
I find it impossible to disagree with the reasoning of the Master or with his application of principle to the circumstances of this case. The authorities make it clear that the mandatory overtone of s 72(3) is to be tempered by analysis of the circumstances prevailing in individual cases. In the present case service by post was acceptable as between the parties. In that context, service must sensibly be construed as effected “immediately after” the notice of appeal was lodged in the High Court, if it was effected within the time-frame permitted by r 206A. Whether such a construction will be placed on any particular set of circumstances will always be a question of fact and degree. In the present case postal service was the mode by which the parties had been communicating. The reasonable inference is that the Corporation’s letter of 12 August enclosing a copy of the notice of appeal was posted contemporaneously with its authorship, and service was after that effected within the time-frame contemplated by the rules for postal service. This brings it within the tests of “without avoidable loss of time” or “as contemporaneous as the circumstances permit”, envisaged in State Insurance General Manager v Scott. Further, as the delay in this case was unforeseeable systemic delay and not the fault of the applicant, it can alternatively be construed as “an explanation or excuse”, also envisaged in State Insurance General Manager v Scott. Determination of such issues by practical and commonsense analysis does not, in my view, cut across the strict compliance requirements of s 72(3). 
I do not regard it necessary to comment on the relevance or otherwise of the risk or absence of prejudice to such a determination. In the present case there is a clear absence of prejudice so it is not a consideration which needs to be weighed in any balancing exercise. 
I therefore concur with the Master’s reasoning on both aspects of the first issue relating to the first notice of appeal. The Master was correct in determining that postal service was an acceptable mode of service in this case, with service being effected within the time-frame permitted by r 206A and/or that a satisfactory “explanation or excuse” existed in the circumstances. In conclusion, therefore, service of the first notice of motion on appeal met the requirements of s 72(3) District Courts Act 1947. 
Although the Master went on to determine the second issue in the Corporation’s favour, I do not regard it as necessary to review his findings on that issue. 
The application for review of the Master’s decision is dismissed. 
For the purposes of r 47(b) High Court Amendment Rules 1999, this proceeding is classified as Category 2 and the time allocation as Category B in the Third Schedule. 

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