#5179 - Harding V. Wealand - Conflict of Laws BCL

Harding v. Wealand

Facts

The accident happened on 3 February 2002 on a dirt track near Huskisson in New South Wales, when the defendant Ms Wealands lost control of the vehicle she was driving and it turned over. Negligence is admitted. The claimant Mr Harding, who was a passenger, was severely injured and is now tetraplegic. Mr Harding is English and Ms Wealands Australian. They had formed a relationship when Mr Harding visited Australia in March 2001 and in consequence Ms Wealands had come to England in June 2001 to live with Mr Harding. At the time of the accident they had gone together to Australia for a holiday and a visit to Ms Wealands's parents. The vehicle belonged to Ms Wealands and she was insured with an Australian insurance company. After the accident, Mr Harding and Ms Wealands returned to England.

Australian legislation on quantification of damages: Chapter 5 of the Motor Accidents Compensation Act 1999 (“MACA”), which was in force at the time of the accident. Section 123 provides that “a court cannot award damages to a person in respect of a motor accident contrary to this Chapter”.

Question

Whether damages for personal injury caused by negligent driving in New South Wales should be calculated according to the applicable law selected in accordance with Part III of the Private International Law (Miscellaneous Provisions) Act 1995 (“Part III”) or whether it is a question of procedure which falls to be determined in accordance with English law.

Holding

Lord Hoffmann

Common law distinction between substance and procedure

In applying this distinction to actions in tort, the courts have distinguished between the kind of damage which constitutes an actionable injury and the assessment of compensation (ie damages) for the injury which has been held to be actionable. The identification of actionable damage is an integral part of the rules which determine liability. As I have previously had occasion to say, it makes no sense simply to say that someone is liable in tort. He must be liable for something and the rules which determine what he is liable for are inseparable from the rules which determine the conduct which gives rise to liability. Thus the rules which exclude damage from the scope of liability on the grounds that it does not fall within the ambit of the liability rule or does not have the prescribed causal connection with the wrongful act, or which require that the damage should have been reasonably foreseeable, are all rules which determine whether there is liability for the damage in question. On the other hand, whether the claimant is awarded money damages (and if so, how much) or, for example, restitution in kind, is a question of remedy.

Thus the majority held that the Maltese law denying liability for non-economic damage was substantive law to be governed by the lex causae while the minority thought that it was a matter of remedy to be governed by the lex fori. All of them agreed that the quantification of the damages to be awarded for actionable heads of damage was a question of remedy or procedure.

Impact of the Private International Law (Miscellaneous Provisions) Act

(3) Without prejudice to the generality of subsection (2) above, nothing in this Part …

(b) affects any rules of evidence, pleading or practice or authorises questions of procedure in any proceedings to be determined otherwise than in accordance with the law of the forum.

Does that mean that the old rule that remedies were a matter for the lex fori was to be abolished and the rule preserved only so far as it related to questions which could strictly speaking be regarded as procedure? In my opinion this would be absurd. In this context, the terms “remedy” and “procedure” had been regularly used interchangeably.

The conclusion that the amount of damages for an injury actionable by the lex causae must be determined according to the lex fori was to be left untouched is confirmed by the Report of the Law Commission and the Scottish Law Commission (Private International Law: Choice of Law in Tort and Delict (Law Com No 193, Scot Law Com No 129)), published in 1990, on which Part III was based. Paragraph 3.38 dealt with damages:

“The consultation paper [Law Commission Working Paper No 87 and Scottish Law Commission Consultative Memorandum No 62, which had been published in 1984] provisionally recommended that there should be no change in the present law on the question of damages, which we confirm. Accordingly, the applicable law in tort or delict determines the question of the availability of particular heads of damages whereas the measure or quantification of damages under those heads is governed by the lex fori.”

For my part, I do not think that there is any ambiguity or obscurity. Of course, taken out of context, the word “procedure” is ambiguous. In its narrow and perhaps most usual sense it means, as La Forest J expressed it in Tolofson v Jensen [1994] 3 SCR 1022 , 1072 those rules which “make the machinery of the forum court run smoothly as distinguished from those determinative of the rights of both parties”. Or it can have a wider meaning which embraces what Mason CJ in Stevens v Head (1993) 176 CLR 433 , 445 called “the traditional equation drawn between matters relating to a remedy and matters of procedure”. This is the sense it which the term has always been used in English private international law. If section 14 is read in its context, against the background of the existing rules of common law and the report of the Law Commission, there can be no doubt that the latter meaning was intended.

Is the Australian legislation procedural?

My Lords, the next question is whether the provisions of MACA to which I have referred should be characterised as relating to the actionability of the economic and non-economic damage suffered by Mr Harding or to the remedies which the courts of New South Wales provide for such damage. On this point we could not have better authority than that of the High Court of Australia in Stevens v Head 176 CLR 433. The majority (Brennan, Dawson, Toohey and McHugh JJ) analysed the equivalent damages-limitation provisions of the Motor Accidents Act 1988 , at pp 454–460, and concluded that they were concerned with quantification rather than heads of damage.

In principle, therefore, I think that the relevant provisions of MACA should be characterised as procedural and therefore inapplicable by an English court. But Mr Palmer, who appeared for the defendant, submitted that in English private international law a limit or “cap” on the damages recoverable is regarded as substantive. There is, it is true, some authority for this proposition

In my opinion the proposition in Dicey was too widely stated. Cope v Doherty is authority for the proposition that a contractual term which limits the obligation to pay damages for a breach of contract or a tort, or a statutory provision which is deemed to operate as such a term, qualifies the substantive obligation. It is not part of the rules of the lex fori for the assessment of damages. In my opinion, therefore, Clarke J was right in Caltex Singapore Pte Ltd v BP Shipping Ltd [1996] 1 Lloyd's Rep 286 to treat a modern limitation statute (in that case, of Singapore) as a procedural provision, limiting the remedy rather than the substantive right.

For the purposes of the traditional distinction between substance and procedure which treats remedy as a matter of procedure, all the provisions of MACA, including limitations on quantum, should be characterised as procedural.

Lord Rodger

Interpretation of Section 14(3)(b)

So, does the expression “questions of procedure” in section 14(3)(b) include questions relating to the assessment of damages? Like Arden LJ, Sir William Aldous adopted a restrictive interpretation of those words: for him, at p...