SUPREME COURT OF QUEENSLAND

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1 SUPREME COURT OF QUEENSLAND CITATION: Fitzgerald v Hill & Ors [2008] QCA 283 PARTIES: SEAN FITZGERALD (plaintiff/first respondent) v GLEN MICHAEL HILL (first defendant/second respondent) SUNCORP METWAY INSURANCE LIMITED ACN (second defendant/third respondent) WAYNE WILLIAM DOBIE (third defendant/not party to appeal) CHONG CHUL RHEE (fourth defendant/not party to appeal) JAMES TREVOR DICKS (fifth defendant/not party to appeal) JOHN IVANOV (sixth defendant/appellant) FILE NO/S: Appeal No 8582 of 2007 Appeal No 8749 of 2007 SC No 5751 of 2002 SC No 751 of 2005 DIVISION: PROCEEDING: ORIGINATING COURT: Court of Appeal General Civil Appeal Application for Extension of Time Supreme Court at Townsville DELIVERED ON: 16 September 2008 DELIVERED AT: Brisbane HEARING DATE: 11 March 2008 JUDGES: ORDERS: CATCHWORDS: McMurdo P, Holmes JA and Mackenzie AJA Separate reasons for judgment of each member of the Court, each concurring as to the orders made 1. In Appeal No 8582 of 2007: appeal dismissed with costs. 2. In Appeal No 8749 of 2007: application for extension of time refused with costs. TORTS NEGLIGENCE ESSENTIALS OF ACTION FOR NEGLIGENCE DUTY OF CARE SPECIAL RELATIONSHIPS AND DUTIES OTHER CASES plaintiff child was a member of a tae kwon do academy in Townsville class included children and adults under control

2 2 of instructor instructor took class to nearby beach to train class ran along the side of the road in bare feet at dusk plaintiff child hit by car while crossing road sixth defendant was owner-operator of tae kwon do academy whether the sixth defendant owed the plaintiff a non-delegable duty of care PROCEDURE SUPREME COURT PROCEDURE QUEENSLAND PROCEDURE UNDER RULES OF COURT PLEADING DEFENCE AND COUNTERCLAIM plaintiff pleaded in statement of claim that the sixth defendant was the owner-operator of the tae kwon do academy sixth defendant admitted that paragraph of the statement of claim in his defence sixth defendant was refused leave to withdraw that admission sixth defendant gave evidence at trial that other persons had elements of control over the academy other evidence led at trial supported admission whether trial judge could act upon admission APPEAL AND NEW TRIAL APPEAL - PRACTICE AND PROCEDURE QUEENSLAND TIME FOR APPEAL EXTENSION OF TIME WHEN REFUSED sixth defendant made admission in pleadings that he was the owner-operator of the tae kwon do academy that the plaintiff attended sixth defendant's application to withdraw admission refused sixth defendant did not lodge appeal against decision until after final judgment was delivered following the trial whether sixth defendant should be granted an extension of time to appeal against interlocutory decision appropriate time to appeal interlocutory decision Supreme Court Act 1995 (Qld), s 254 Supreme Court of Queensland Act 1991 (Qld), s 69 Uniform Civil Procedure Rules 1999 (Qld), r 5, r 188, r 744, r 745, r 748, r 765 Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520; [1994] HCA 13, considered Chapman v State of Queensland [2003] QCA 172, cited Cropper v Smith [1884] 26 Ch D 700, cited Damberg v Damberg (2001) 52 NSWLR 492; [2001] NSWCA 87, distinguished Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478; [2002] HCA 22, cited Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228, affirmed House v The King (1936) 55 CLR 499; [1936] HCA 40, cited Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344, cited Kondis v State Transport Authority (1984) 154 CLR 672; [1984] HCA 61, considered Lee-Anne Duncan by her next friend Noel Duncan v Trustees

3 3 COUNSEL: SOLICITORS: of The Roman Catholic Church for The Archdiocese of Canberra and Goulburn [1998] ACTSC 109, cited Leichhardt Municipal Council v Montgomery (2007) 230 CLR 22; [2007] HCA 6, considered Lilypond Constructions Pty Ltd v Homann [2006] 1 Qd R 411; [2005] QSC 263, cited McLaren v Public Curator of Queensland & Anor [1965] QWN 18, cited Paulger v Hall [2003] 2 Qd R 294; [2002] QCA 353, cited Pioneer Industries Pty Ltd v Baker [1997] 1 Qd R 514; [1995] QCA 565, considered Rigato Farms Pty Ltd v Ridolfi [2001] 2 Qd R 455; [2000] QCA 292, cited Robertson v The Hobart Police & Citizens Youth Club Inc [1984] Aust Torts Reports , considered Shaw v Commonwealth of Australia (1992) 110 FLR 379, cited Spencer & Anor v Hutson & Ors [2007] QCA 178, cited State of New South Wales v Lepore; Samin v State of Queensland; Rich v State of Queensland (2003) 212 CLR 511; [2003] HCA 4, applied Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16; [1986] HCA 1, applied The Commonwealth v Introvigne (1982) 150 CLR 258; [1982] HCA 40, applied The State of Queensland & Anor v J L Holdings Pty Limited (1997) 189 CLR 146; [1997] HCA 1, cited Water Board v Moustakas (1988) 180 CLR 491; [1988] HCA 12, applied Williams and Williams v Cadillac Transport Repairs Pty Ltd [2004] NTSC 57, considered K C Fleming QC for the appellant K D Dorney QC, with C A White, for the first respondent P V Ambrose SC, with A S Kitchin, for the second and third respondents Bennett and Philip for the appellant Roberts Nehmer McKee for the first respondent Cleary and Lee for the second and third respondents [1] McMURDO P: The plaintiff and first respondent, Sean Fitzgerald, was eight years old on Monday, 30 October when he was taking part in a Rhee Tae Kwon Do class in St Mark's Hall, Belgian Gardens, a Townsville suburb. The members of the class were taken on a run by the third defendant, Wayne William Dobie, their Rhee Tae Kwon Do instructor. Mr Dobie died in July The class members were running along the side of a road at about 7.30 pm when Sean was struck by a vehicle driven by the first defendant and second respondent, Glen Michael Hill. Sean suffered severe injuries. The second defendant and third respondent, Suncorp Metway Insurance Limited ("Suncorp"), was Mr Hill's insurer. Sean's action for 1 The Civil Liability Act 2003 (Qld) therefore did not apply.

4 4 damages for negligence proceeded at trial only against Mr Hill, Suncorp and the sixth defendant and appellant, John Ivanov, whom Sean claimed was the owner and operator of the academy in which Sean's Rhee Tae Kwon Do class was conducted at St Mark's Hall on 30 October [2] On 13 December 2006 Mr Ivanov's application to the Townsville Supreme Court to withdraw the admission in his defence that he was the owner and operator of the Rhee Tae Kwon Do academy at St Mark's Hall was unsuccessful. Mr Ivanov did not appeal from the order dismissing his application before the trial. [3] The trial was heard in the Townsville Supreme Court over three days in August The judge found the following matters relevant to this appeal. Mr Hill was negligent in failing to reduce significantly the speed of his motor vehicle as he approached the point where Sean and other members of the group were standing. In the circumstances, he should at least have sounded his horn to warn of the approach of his vehicle. Mr Hill's negligence was a cause of Sean's injuries. Mr Ivanov admitted in his pleadings that he owned and operated the "'Rhee Tae Kwon Do' Academy" from premises at St Mark's Hall, Belgian Gardens and that Sean was enrolled as a student there. Because of that admission, the judge found that Mr Ivanov was the person with ultimate responsibility for the conduct of the Rhee Tae Kwon Do class that Sean attended at the time he was injured. Mr Ivanov denied that he employed Mr Dobie. Whilst Sean did not make out a case to show that Mr Ivanov exercised control over Mr Dobie in a relationship of employer and employee, Sean was entitled to rely on Mr Ivanov's breach of a non-delegable duty as the person responsible for the conduct of the class in which Sean was enrolled. Mr Ivanov failed to ensure that reasonable care was taken in the performance of the activities involved in the classes. [4] On 31 August 2007 his Honour gave judgment for Sean against Mr Hill, the insurer and Mr Ivanov in the sum of $730, and ordered that to the extent of one half the judgment sum, Mr Hill and Suncorp on the one hand and Mr Ivanov on the other, indemnify one another against their liability to Sean for the judgment sum. Mr Ivanov appeals against that decision (Appeal No 8582 of 2007) contending that the judge was wrong in three ways. The first was that the judge found that Mr Ivanov rather than Mr Dobie was the owner and operator of the Rhee Tae Kwon Do Academy when Mr Dobie was not an employee of Mr Ivanov. The second was in finding that there was a non-delegable duty owed to Sean by Mr Ivanov because he was neither the owner of the Academy nor the employer of Mr Dobie. The third was that the question of non-delegable duty was sufficiently open on the pleadings. [5] Mr Ivanov has also applied for an extension of time to appeal (Appeal No 8749 of 2007) against the decision of the primary judge of 13 December 2006 dismissing his application for leave to withdraw the admission made in paragraph 3(i) of his defence, the admission central to the primary judge's relevant conclusions at the trial. Mr Ivanov did not appeal from that interlocutory order within the 28 days as required by the Uniform Civil Procedure Rules 1999 (Qld) ("UCPR"). The three day trial in August 2007 was conducted in reliance on it. The application for an extension of time to appeal from the interlocutory order of 13 December 2006 was filed on 4 October 2007 almost nine months late. The only explanation given for the delay is that the order was an interlocutory one so that it could be challenged at the hearing of an appeal from the final order.

5 5 [6] Mr Hill and Suncorp have been given leave to join in the appeal and the application. In both matters they, like Sean, seek to uphold the primary judge's reasons and orders. The application for an extension of time to appeal from the interlocutory order refusing Mr Ivanov leave to withdraw his admission (Appeal No 8749 of 2007) The pleadings [7] Sean, in his statement of claim dated 29 August 2002, relevantly pleaded that: "3. On the 30 th October 1989: (i) [Sean] then aged 8 years old was enrolled as a tae kwon do student at the "Rhee Tae Kwon Do" academy which was then owned by [Chong Chul Rhee] and/or [James Trevor Dicks] and/or [Mr Ivanov], and operated by them, or one of them, from premises at St Mark's Hall in Belgian Gardens and at 45 Ingham Road Townsville ; (ii) as a consequence of [Sean's] enrollment [sic] at the academy a contract existed between [Sean] and the owner and operator of the academy and it was an implied term and condition of that contract that the owner and operator of the academy would do all things reasonably necessary to ensure the safety of [Sean] whilst he was attending the academy and participating in the activities of the academy; (iii) [Mr Dobie] was employed as an instructor at the academy operated at St Mark's Hall; (iv) At about 7.15 p.m., [Mr Dobie], in the course of his aforesaid employment, took a class of about 9 students from the academy, including [Sean], on a training run from St Mark's Hall and through the streets of Belgian Gardens and Rowes Bay intending to reach the beach at Pallarenda; this was an activity of the academy; 5. The injuries and consequential loss suffered by [Sean] were caused by the negligence of [Mr Hill] and/or the negligence of [Mr Dobie] and/or the breach of contractual obligation of [Chong Chul Rhee] and/or [James Trevor Dicks] and/or [Mr Ivanov] through the negligence of their servant or agent, [Mr Dobie]. PARTICULARS OF NEGLIGENCE OF [MR DOBIE] 1. Failing to exercise proper control over [Sean] while he was in the care of [Mr Dobie]. 2. Failing to warn [Sean] of the presence of the motor vehicle driven by [Mr Hill] on the roadway. 3. Leaving [Sean] unsupervised on the edge of the roadway.

6 6 4. Failing to keep a proper lookout for vehicular traffic on the roadway. 5. Failing to instruct [Sean], adequately or at all, in what he should do prior to crossing the roadway. 6. Failing to instruct [Sean] to use the near-by pedestrian crossing to cross the road. " [8] In his defence, Mr Ivanov relevantly pleaded: "3. As to paragraph 3 of the Statement of Claim: (i) [Mr Ivanov] admits the allegations in paragraph 3(i) save and except that [Mr Ivanov] says he owned and operated the "Rhee Tae Kwon Do" Academy. (ii) As to paragraph 3(ii) [Mr Ivanov] does not plead to the allegations because the allegations are matters of law. Save and except [he] denies that any term implied into the alleged contract is in the terms as alleged by [Sean]. (iii) As to paragraph 3(iii) [Mr Ivanov] denies the allegation contained therein. BASIS [Mr Dobie] was not employed as an instructor by [Mr Ivanov] albeit that [Mr Ivanov] did carry out some voluntary work assisting students at the Rhee Tae Kwon Do academy. (iv) As to paragraph 3(iv) [Mr Ivanov] admits that at about 7.15pm [Mr Dobie] took a number of students including [Sean] on an exercise run as alleged but denies that this was done in his capacity as an employee of [Mr Ivanov] because [Mr Dobie] was not an employee of [Mr Ivanov]. 5. As to paragraph 5 of the Statement of Claim [Mr Ivanov] denies that any injuries and consequential loss suffered by [Sean] were caused by the negligence of [Mr Dobie] and or the breach of any contract on the part of [Mr Ivanov] through his own and [Mr Dobie's] negligence. " BASIS [Mr Ivanov] denies that he was personally negligent in any way at all and further denies that [Mr Dobie] was negligent as alleged in the particulars so alleged. Further, [Mr Dobie] was not an employee of [Mr Ivanov] at any material time. [9] On 20 September 2006 Mr Ivanov filed an application to withdraw the admission made in paragraph 3(i) of his defence under UCPR r 188. The application was heard on 13 December [10] The following uncontroversial matters emerged at the hearing. On 8 October 2002 Mr Ivanov's then solicitor, Mr Dwyer, wrote to Sean's solicitors stating that they acted for Mr Ivanov in the proceedings. On 27 March 2003 proceedings were discontinued against the fifth defendant, James Trevor Dicks. On 8 May 2003 a

7 7 Form 1 Notice of Claim under the Personal Injuries Proceedings Act 2002 (Qld) ("PIPA") was served on Mr Ivanov's solicitors. On 26 May 2003 the proceedings were discontinued against Mr Dobie, who had died almost two years earlier. On 27 May 2003 Mr Dwyer faxed Mr Ivanov the Form 1 Notice of Claim. The next day Mr Ivanov responded through Mr Dwyer to Sean's solicitors under s 12(1) of the Act that he considered himself a proper respondent to Sean's claim. On 14 June 2004 Mr Ivanov's defence containing the contentious admissions was filed. It was prepared by his counsel on instructions from Mr Dwyer. A mediation was conducted in December 2004 on behalf of Mr Ivanov and Sean by their legal representatives on the basis that Mr Ivanov was the owner and operator of the academy at St Mark's Hall. In February 2005 Mr Ivanov provided to Mr Dwyer an unsigned statement in statutory declaration form to the effect that the fourth defendant, Chong Chul Rhee, owned the tae kwon do academies at St Mark's Hall and at Ingham Road as well as other similar academies throughout Australia; Mr Ivanov was not associated with the classes operated by Mr Dobie at St Mark's Hall; and Mr Rhee directed Mr Dobie on how to operate and conduct those classes. [11] Mr Ivanov swore an affidavit and gave evidence in the application. His evidence was to the following effect. He stated that the admission in his defence was made by his solicitor without his instructions or knowledge insofar as it suggested he owned and operated the Rhee Tae Kwon Do academy at St Mark's Hall. He conducted a Rhee Tae Kwon Do branch at 45 Ingham Road, Townsville under an arrangement with Mr Rhee. Mr Rhee was to receive all student registration fees and fees for gradings and tests conducted by him at Ingham Road. Mr Ivanov received student training fees from branches operated by him under Mr Rhee's approval. Mr Ivanov was the controlling instructor of branches located at Ingham Road and at a number of other branches in North Queensland, but not the St Mark's Hall branch. At the date of the accident, the St Mark's Hall branch was controlled and operated by Mr Dobie. Mr Ivanov had no authority or control over the operation of this branch and did not employ Mr Dobie. Mr Ivanov did not derive any financial benefit from Mr Dobie's branch. Mr Ivanov's branch at 45 Ingham Road was referred to as "the headquarters" of Rhee Tae Kwon Do because that is where Mr Rhee conducted gradings tests for all students in the North Queensland branches. All branches contributed to the cost of promotion of Rhee Tae Kwon Do in Townsville, including advertising in the Yellow Pages telephone directory. [12] In cross-examination Mr Ivanov agreed that he trained Mr Dobie as a tae kwon do exponent from white belt to black belt. He was shown photographs of a number of advertisements for the St Mark's Hall academy which displayed only Mr Ivanov's telephone number. He explained that this was done on Mr Rhee's direction and because Mr Ivanov was the most senior instructor. Mr Ivanov did not receive fees from the St Mark's Hall academy. After receiving Sean's statement of claim, Mr Ivanov instructed Mr Dwyer that he had no association or authority or any control at all over the tae kwon do academy at St Mark's Hall at the relevant time. [13] At this point in the proceedings, the judge noted that Mr Dwyer was not given the opportunity to comment on this claim. [14] Mr Ivanov's evidence continued as follows. At the time of Sean's accident he was operating a business on behalf of Mr Rhee at 45 Ingham Road, Townsville; he was not operating his own business. If his wife told Mr Dwyer something to the contrary, it was incorrect. At all times he told Mr Dwyer that he had no authority or

8 8 control over the operation of the tae kwon do academy at St Mark's Hall. He had no knowledge of the admission made in his defence to Sean's claim until April [15] Mr Ivanov's solicitor at the time of the admission, Mr Dwyer, gave evidence in terms which included the following. He had known Mr Ivanov personally for over 20 years and had acted as his solicitor for four or five years before Sean's accident. At about the time of the accident Mr Ivanov telephoned him and told him "there had been an incident involving a child with then instructor Wayne Dobie's branch at Belgian Gardens." Mr Ivanov was looking for some general advice about what he could do in relation to the matter. He and Mrs Ivanov wanted to visit the child at the hospital and express their sympathies. Mr Dwyer gave them some advice on that issue. After Mr Dwyer received Sean's statement of claim, which was served on Mr Ivanov on 23 September 2002, he gave Mr Ivanov general advice about Mr Ivanov's potential liability and obligations and that of other parties. Mr Dwyer suggested Mr Ivanov get formal advice about the matter and a local solicitor (which Mr Dwyer was not) would be best served to act for him in it. [16] Mr Dwyer's drafting of the defence which included the contentious admission "was based on [his] understanding of [Mr Ivanov's] relationship to what was then Rhee Tae Kwon Do in Townsville and [a]nd not specifically at that hall." Mr Dwyer did not seek specific instructions about whether Mr Ivanov was the owner and operator of the tae kwon do academy at St Mark's Hall. Mr Dwyer believed that Mr Dobie was Mr Ivanov's representative at the St Mark's Hall academy because of Mr Dwyer's past involvement with Mr Ivanov and Mr Dwyer's personal involvement in Rhee Tae Kwon Do. Mr Dwyer had advised Mr Ivanov in respect of earlier litigation between Mr Ivanov and Mr Rhee about their respective interests in Rhee Tae Kwon Do in Townsville and other areas. At that time, Mr Ivanov asserted that he was the owner and operator of the St Mark's Hall academy. Mr Ivanov did not subsequently instruct Mr Dwyer that he was not the owner and operator of the St Mark's Hall academy when Mr Ivanov sent Mr Dwyer the statement of claim. Nor did Mr Ivanov instruct him that Mr Dobie was not his representative at the St Mark's Hall academy. [17] Mr Dwyer received Sean's notice of claim under PIPA on 8 May 2003 and faxed it to Mr Ivanov on 27 May Part 18 of that document stated: "The accident would not have occurred but for the negligence of the driver of the motor vehicle, Glen Michael Hill, and that of the Instructor, Wayne Dobie. The instructor, Wayne Dobie, was employed by the Tae Kwon Do Academy, the proprietors of which were Chong Chul Rhee and John Ivanov." [18] Mr and Mrs Ivanov operated their business activities together. Mr Dwyer sought instructions from them as to the notice of claim. He received instructions from Mrs Ivanov on behalf of Mr Ivanov. She confirmed that Mr Ivanov was a proper respondent to Sean's claim. At no time did Mr Ivanov suggest to the contrary. Mr Dwyer responded on behalf of Mr Ivanov on 28 May 2003 that "our client instructs that he considers himself to be a proper Respondent to the claim.". On that basis, Mr Dwyer prepared a defence containing the admission. The defence was settled by counsel on Mr Dwyer's instructions.

9 9 [19] Mr Dwyer conducted a mediation on behalf of Mr Ivanov in December 2004 on the basis that Mr Ivanov was the owner and operator of the academy. Prior to the mediation he had telephone conferences with Mr Ivanov. Mr Ivanov did not say that the St Mark's Hall academy had nothing to do with him. [20] In January 2005 Mr Dwyer wrote to Sean's solicitors telling them he was contemplating joining Mr Rhee but in December 2005, after giving Mr Ivanov legal advice, Mr Ivanov instructed him not to do so. He ceased to act for Mr Ivanov on 16 January The judge's reasons [21] The primary judge's reasons for dismissing the application to withdraw the admission were as follows. The accident occurred in Sean's claim against Mr Ivanov had been underway since Mr Dobie had died before the proceedings were served on him. No steps have been taken to add his estate as a party to the action. No steps have been taken against the fourth defendant, Mr Rhee, for well in excess of the two years provided for under the UCPR before leave was required to pursue the action against him. In those circumstances, it was entirely possible that Mr Rhee would be prejudiced if the claim against him was reactivitated. The proceedings against James Trevor Dicks had been discontinued. Mr Ivanov deposed that he did not at any time have any interest in the business conducted at St Mark's Hall and that the admission was made without and contrary to instructions to his then solicitors. Mr Dwyer swore that he made the admission, settled by counsel, on his personal understanding of the relationship between Mr Ivanov and Mr Dobie and not on direct instructions. When cross-examined, he said he was familiar with Mr Ivanov's interest in the tae kwon do branches in the area and had previously acted for him in litigation with Mr Rhee. [22] Sean's notice of claim under the Act was served on Mr Ivanov. 2 It stated that Mr Ivanov was one of the proprietors of the academy employing Mr Dobie. Mr Ivanov was required to make a preliminary response indicating whether he considered himself a proper respondent to the claim. On 28 May 2003 he responded under s 12(1) of PIPA through Mr Dwyer in these terms: "Our client instructs that he considers himself to be a proper respondent to the claim." Mr Dwyer gave evidence that he obtained instructions from Mrs Ivanov (Mr Ivanov's wife) on his behalf. She frequently phoned him on Mr Ivanov's behalf and the judge inferred she did so on this occasion. There was no evidence from Mrs Ivanov before the judge. Mr Dwyer spoke to Mr Ivanov in preparation for the mediation and said he discussed with him the basis upon which Sean alleged liability; at no stage did Mr Ivanov demur to the proposition that he was the owner of the business. For the last couple of years, Sean had proceeded on the basis that Mr Ivanov was the owner and operator of the St Mark's Hall academy and that it was unnecessary to prove these facts to establish his claim. An obvious injustice would necessarily follow if Mr Ivanov were now allowed to withdraw the admission. There was a very real risk of prejudice because the accident occurred so long ago; no steps had been taken against Mr Rhee for some years; and no steps had been taken to join Mr Dobie's estate. 2 Set out in these reasons at [17].

10 10 [23] Referring to the principles stated in Rigato Farms Pty Ltd v Ridolfi, 3 the judge accepted that there was now a genuine dispute as to who was the owner and operator of the St Mark's Hall academy. The judge considered that Mr Ivanov's explanation for the admission was "not really favourable" and that on Mr Dwyer's understanding, which was "a justifiable one in terms of what he had been informed by Mrs Ivanov", the admission was correct. His Honour considered that it was not, however, helpful to attempt to resolve such conflicts in a preliminary hearing of this kind: Lilypond Constructions Pty Ltd v Homann. 4 But in any case, his Honour considered that there was a significant risk of prejudice given the delay in applying to withdraw the admission, particularly because of the time that has passed since any steps were taken against Mr Rhee. His Honour determined that the court's discretion should not be exercised to allow the admission to be withdrawn. This conclusion was consistent with the "charter of procedure" 5 in the UCPR which was particularly apposite here. The submissions on behalf of Mr Ivanov [24] Mr Ivanov contends that an extension of time to appeal is unnecessary. Because the order of 13 December 2006 was an interlocutory order, it could be challenged at the hearing of an appeal from the final order: Pioneer Industries Pty Ltd v Baker; 6 Gerlach v Clifton Bricks Pty Ltd 7 and Paulger v Hall. 8 He contends that the issue of whether he should have been allowed to withdraw his admission can be considered simply as a ground of appeal in Appeal No 8582 of [25] Mr Ivanov submits he should have been allowed to withdraw his admission, emphasising the following. He gave evidence that the admission was made without instructions and wrong. The refusal to allow him to withdraw the admission effectively defeated his right to defend this aspect of the claim. UCPR r 5 states the philosophy of the UCPR as "to facilitate the just and expeditious resolution of the real issues in civil proceedings at a minimum of expense". Emphasis must be given to the term "just". If justice required the withdrawing of the admission then the judge erred in not granting Mr Ivanov's application: State of Queensland v J L Holdings Pty Ltd; 9 Cropper v Smith. 10 The contentions made on behalf of Sean, Mr Hill and Suncorp [26] The three respondents contend the following. The UCPR require that any appeal from the order of 13 December 2006 had to be commenced within 28 days. 11 In order to be granted an extension of time to appeal against the primary judge's refusal to allow the withdrawal of the admission, Mr Ivanov must demonstrate both an acceptable explanation for the very substantial delay and that it is fair and equitable in the circumstances to extend time: Hunter Valley Developments Pty Ltd v Cohen, 12 Chapman v State of Queensland, 13 and McLaren v Public Curator of [2001] 2 Qd R 455; [2000] QCA 292. [2006] 1 Qd R 411; [2005] QSC 263. See Rigato Farms Pty Ltd v Ridolfi [2001] 2 Qd R 455; [2000] QCA 292 at 459 [21] (de Jersey CJ). [1997] 1 Qd R 514; [1995] QCA 565. (2002) 209 CLR 478; [2002] HCA 22. [2003] 2 Qd R 294; [2002] QCA 353. (1997) 189 CLR 146; [1997] HCA 1 at 152, 154, 165. [1884] 26 Ch D 700 at 710. Rule 748(a). See also rr 744, 745. (1984) 3 FCR 344 at [2003] QCA 172 at [3].

11 11 Queensland & Anor. 14 The only explanation given as to the delay in lodging the application was from Mr Ivanov's present solicitor who deposed that no appeal was lodged until the trial had been heard as this was an interlocutory decision. The cases relied on by Mr Ivanov as supporting his contention that he is not subject to the time limits specified in the UCPR are distinguishable from the present case which is subject to the UCPR. [27] The respondents submitted the prejudice occasioned by the delay in seeking to appeal from the December 2006 order is a material factor militating against the grant of an extension of time to appeal. Since the primary judge's decision, a three day trial has been conducted on the basis of Mr Ivanov's admission. The parties approached the trial without having to conduct investigations into the ownership and control of the St Mark's Hall academy. If an extension of time were now granted, the appeal allowed and the admission withdrawn, a re-trial would be required. In these circumstances there is no satisfactory explanation for the delay in bringing this application and considerations of fairness support its dismissal. [28] In any case, the judge's decision was a discretionary one and Mr Ivanov has not demonstrated any basis to interfere with it: House v The King. 15 If an extension of time were granted, the appeal should be refused. Conclusion application for an extension of time [29] Mr Ivanov had a right of appeal to this Court from the judge's interlocutory order of 13 December 2006: s 69 Supreme Court of Queensland Act 1991 (Qld) and s 254 Supreme Court Act 1995 (Qld). Under UCPR r 745(2) and r 765, ordinarily the appeal, being "other than a final decision in a proceeding", would be by way of an appeal in the strict sense 16 rather than an appeal by way of re-hearing. 17 The court could, however, hear the appeal by way of re-hearing if satisfied it is in the interests of justice to proceed in that way. 18 Any appeal from the primary judge's interlocutory decision was to be filed within 28 days of the decision. 19 Mr Ivanov plainly chose not to exercise that right of appeal and to instead proceed to trial. [30] There are instances where it is entirely appropriate to delay any appeal in respect of an interlocutory order until the conclusion of the trial: see, for example Gerlach v Clifton Bricks Pty Ltd 20 and Pioneer Industries Pty Ltd v Baker. 21 In some instances where there is no appeal from an interlocutory decision, it may be the only way of challenging an interlocutory order: cf Paulger v Hall. 22 Those cases on which Mr Ivanov relies are all distinguishable from the present in that the interlocutory orders there did not, as here, impact directly on an issue central to the pending trial, namely, whether Mr Ivanov was the owner and operator of the "Rhee Tae Kwon Do" academy which Sean was attending on 30 October This was plainly a case where, if Mr Ivanov wished to challenge the primary judge's decision not to allow him to withdraw his admission, he should have exercised his right of appeal [1965] QWN 18. (1936) 55 CLR 499; [1936] HCA 40. UCPR, r 765(2). UCPR, r 765(1). UCPR, r 765(4). UCPR, r 748. (2002) 209 CLR 478; [2002] HCA 22. [1997] 1 Qd R 514; [1995] QCA 565. [2003] 2 Qd R 294; [2002] QCA 353.

12 12 within the appeal period allowed under the UCPR so that the issues in dispute between the parties could be clarified before trial. [31] It would be entirely inappropriate for a litigant to delay an appeal from the refusal to withdraw the admission, for the parties to then prepare and conduct a trial on the basis of the admission, for judgment to be given and for the dissatisfied party to only then appeal from the interlocutory order dismissing the application to withdraw the admission. If an appellant were then successful in withdrawing the admission, there would have to be a re-trial. The parties would have to prepare for the re-trial on a different basis than for the original trial. Such an outcome would fly in the face of the philosophy and overriding obligations of parties and the court under UCPR r 5. These are "to facilitate the just and expeditious resolution of the real issues in civil proceedings at a minimum of expense". 23 Each party impliedly undertakes to the court and to the other parties to proceed in an expeditious way. 24 The philosophy of the rules and the obligation they place on parties and the court meant that if Mr Ivanov wished to contradict the admission at trial, he should have lodged an appeal against the order dismissing his application to withdraw the admission within 28 days of the order being made. [32] The only explanation given for the very substantial delay in seeking to appeal from the order of 13 December 2006 is that the matter was an interlocutory one. For the reasons given, that does not in the present circumstances justify the delay of almost nine months. For the reasons given below, were an extension of time to appeal granted, Mr Ivanov's prospects of successfully appealing the primary judge's exercise of discretion in refusing his application to withdraw the admission are not promising. I would refuse the application for an extension of time to appeal from the primary judge's decision of 13 December [33] Even if I am wrong and Mr Ivanov has a right of appeal from that interlocutory decision encompassed in his right of appeal from the primary judge's final decision on 31 August 2007, I would refuse an appeal on that ground for the following reasons. [34] UCPR r 188 gives the court an unfettered discretion to allow a party to withdraw an admission made in a pleading. The primary judge's decision appears to be an entirely orthodox exercise of that discretion. Although Mr Ivanov gave oral evidence before the judge that he did not instruct Mr Dwyer to make the admission and that the admission was wrong, there was other evidence convincingly supporting the admission. Mr Dwyer acted on his own apparently extensive knowledge of Mr Ivanov's business arrangements and on instructions from Mr Ivanov's wife, who frequently gave him instructions on behalf of Mr Ivanov. Mrs Ivanov did not give evidence in the application. It was a reasonable inference that her evidence would not assist Mr Ivanov's application. Mr Ivanov's claim that he was not aware of the admission until April 2006 seems implausible. Mr Ivanov's evidence did not demonstrate that, on balance, the admission was factually wrong. [35] The judge, rightly in my view, reasoned that substantial prejudice would result to Sean and to others were Mr Ivanov's admission withdrawn at that late stage. The prejudice which existed in December 2006 has now been magnified, not UCPR, r 5(1). UCPR, r 5(3).

13 13 diminished, with the effluxion of another 18 months and the subsequent preparation, hearing and determination of Sean's claim following a three day trial. [36] The real risk of prejudice to Sean and to other potential defendants if the admission was withdrawn, the absence of convincing evidence that the admission was wrong and the desirability to now bring some finality to this litigation 25 all favoured the refusal of the application. The judge's discretion in dismissing the application to withdraw the admission was soundly exercised. If this Court were to re-exercise that discretion, the present evidence and circumstances even more strongly warrant the refusal of the application to withdraw the admission. [37] I would refuse with costs the application for an extension of time to appeal against the primary judge's order of 13 December The appeal (Appeal No 8582 of 2007) Mr Ivanov's contentions [38] Mr Ivanov contends first that despite the admission that he owned and operated the academy, the overwhelming weight of the evidence at trial demonstrated that Mr Dobie was not Mr Ivanov's employee and the primary judge accepted this. 26 It was, therefore, a fiction for the judge to conclude that Mr Ivanov owed a nondelegable duty to Sean through Mr Dobie. Control is a prominent factor in determining whether a person is another's employee: Stevens v Brodribb Sawmilling Company Pty Ltd. 27 The evidence did not support a conclusion that Mr Dobie was either an employee or an independent contractor. The evidence called at trial threw doubt on the correctness of Mr Ivanov's admission that he owned and operated the St Mark's Hall academy so that, consistent with Damberg v Damberg, 28 the judge should not have acted on that admission. [39] Mr Ivanov's second contention is that the judge erred in concluding 29 that the pleadings raised a claim that Mr Ivanov owed Sean a non-delegable duty of care. Sean's claim against Mr Ivanov was based on his alleged ownership and operation of the St Mark's Hall academy, the employment of Mr Dobie and Sean's reliance upon an implied contractual term or condition that the owner and operator of the academy would do all things reasonably necessary to ensure Sean's safety. It was also pleaded that Mr Ivanov was vicariously liable for Mr Dobie's negligent acts committed in the course of his employment as an instructor. It was not pleaded that Mr Ivanov owed Sean a non-delegable duty. Further, Mr Ivanov denied he was liable for Mr Dobie's negligence because Mr Dobie was not his employee. Mr Ivanov's submits that the issue of a non-delegable duty of care to Sean was not raised. [40] Finally, Mr Ivanov contends that if a non-delegable duty of care to Sean were pleaded, it was not owed by Mr Ivanov who had no direct arrangement with Sean and so cannot be held liable for injury to him See Spencer & Anor v Hutson & Ors [2007] QCA 178 at [28]. Relying on Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [68]. (1986) 160 CLR 16; [1986] HCA 1 at 24 (Mason J) and 35 (Wilson and Dawson JJ). (2001) 52 NSWLR 492; [2001] NSWCA 87 at [157]-[163]. See Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [66].

14 14 The contentions on behalf of the respondents [41] Counsel for the respondents contend that the appeal should be dismissed for the following reasons. In the circumstances of this case, Damberg 30 does not support Mr Ivanov's argument that the judge should not have acted on his admission. Damberg concerned an agreement between the parties as to what was the applicable foreign law. It did not concern an admission on the pleadings of a fact alleged against a party made under the UCPR. It should be distinguished. [42] It may be inferred that the parties approached the trial on the basis of Mr Ivanov's admission and so did not attempt to lead evidence of those admitted facts. In those circumstances, Mr Ivanov was not entitled to rely on the paucity of evidence about admitted facts to seek to have the admission overturned on appeal. In any case, there was a significant body of evidence supporting the admission. Mr Ivanov's telephone number was listed in the Yellow Pages for a number of Rhee Tae Kwon Do academies, including the St Mark's Hall academy and was on the sign displayed outside the hall where the St Mark's Hall academy was conducted. Once a person joined the Rhee Tae Kwon Do classes at one venue they were entitled to train at other branches and often did so without paying additional fees. A number of witnesses trained at both Mr Ivanov's Ingham Road premises and the St Mark's Hall academy. Gradings were held at Ingham Road for students from the St Mark's Hall academy. Mr Ivanov and Mr Dobie visited each other's academies. Mr Ivanov took photographs of the accident scene shortly after the accident and kept a copy of them because Mr Dobie told him to. Mr Ivanov witnessed signatures on statements from witnesses to the accident and kept a copy because Mr Dobie asked him to. [43] A non-delegable duty was not specifically pleaded in Introvigne and it did not have to be here. The facts on which the claim against Mr Ivanov based on his nondelegable duty to Sean were sufficiently pleaded in the statement of claim to enable the court to apply the law to facts proved: Williams and Williams v Cadillac Transport Repairs Pty Ltd. 31 The purpose of pleadings is to ensure each party knows the case to be met: Water Board v Moustakas. 32 Sean's pleadings served that purpose in respect of the claim of non-delegable duty against Mr Ivanov. [44] The facts establishing that Mr Ivanov owed Sean a non-delegable duty were sufficiently pleaded and explored at trial. Mr Ivanov was the owner and operator of the St Mark's Hall academy in which Sean was enrolled at the time he was injured. The St Mark's Hall academy provided physical instruction in martial arts to children as young as eight. The owner and operator of it owed a duty of care to the children enrolled in classes to provide reasonable care to protect them from harm. That duty is non-delegable. Mr Ivanov conceded in evidence that he would not have acted as Mr Dobie did in not gathering all the students together to cross the road as one group under the direction of the instructor and that taking children as young as eight for a run along the side of a road at dusk in a class of 10 or 12 students was unsafe. Mr Ivanov knew from the pleaded facts the case he had to meet and these issues were explored at trial. [45] The trial judge was correct in concluding that Mr Ivanov's admission meant that he had ultimate responsibility for the conduct of the tae kwon do class in which Sean (2001) 52 NSWLR 492; [2001] NSWCA 87. [2004] NTSC 57 at [72]. (1988) 180 CLR 491; [1988] HCA 12 at 497.

15 15 was enrolled at the time he was injured. 33 It was not disputed that Mr Dobie was the instructor of Sean's class at the time of the accident and that he ought to have taken better care of the children in the group when their activities took them close to and across a busy road. 34 The inevitable conclusion was that Mr Ivanov as owner and operator of the St Mark's Hall academy was responsible by way of breach of a nondelegable duty of care for the injuries suffered by Sean because of Mr Dobie's negligence. The judge was right to conclude that paragraphs 3(ii) and 5 of Sean's statement of claim when read together alleged that the owner and operator of the academy owed Sean a non-delegable duty of care: 35 see The Commonwealth v Introvigne 36 and State of New South Wales v Lepore; Samin v State of Queensland; Rich v State of Queensland. 37 The judge correctly concluded that Mr Ivanov was liable in damages for the injuries suffered by Sean. The primary judge's reasons [46] The judge found that the eight year old Sean was one of a group of 10 to 15 members of a Rhee Tae Kwon Do class gathered for that purpose at St Mark's Hall. They were running in the course of those activities to Rowes Bay when Sean was hit by a vehicle driven by Mr Hill. His Honour noted the following The trial was conducted within the parameters of the admission which Mr Ivanov had unsuccessfully sought to withdraw. 38 To some extent, evidence at the trial traversed the subject of that admission. This evidence was relevant to the relationship between Mr Ivanov and Mr Dobie, Mr Ivanov having denied that there was any relationship between them which gave rise to liability on his part for Mr Dobie's actions or admissions. [47] The judge then set out the relevant portions of the pleadings. 39 The judge considered that the pleadings, although "somewhat awkwardly expressed", 40 made clear that Mr Ivanov admitted that Sean: " was enrolled as a student at a Rhee Tae Kwon Do academy and that this academy was owned and operated by [Mr Ivanov] (as opposed to any of the other defendants) from premises at St Mark's hall in Bundock Street, Belgian Gardens and at 45 Ingham Road, Townsville in the State of Queensland." 41 [48] The judge concluded from that admission that Mr Ivanov was the person having ultimate responsibility for the conduct of the class Sean was enrolled in and attended on the evening he was injured. 42 [49] The judge noted that paragraph 5 of the statement of claim alleged that Sean's injuries were the consequence of the negligence of Mr Hill and/or Mr Dobie and/or breach of contractual obligation of Chong Chul Rhee and/or James Trevor Dicks and/or Mr Ivanov and then set out the particulars of Mr Dobie's acts or omissions Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [62]. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [67]. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [66]. (1982) 150 CLR 258; [1982] HCA 40. (2003) 212 CLR 511; [2003] HCA 4 at 522, 531, 533, 599, 607, 624. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [56]. Set out in these reasons at [7]-[8]. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [61]. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [61]. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [62].

16 16 alleged to constitute the negligence. 43 His Honour considered that whilst the pleading was by no means satisfactory, the allegation in the statement of claim paragraph 3(ii) taken with paragraph 5 sufficiently raised a claim against Mr Ivanov based on a non-delegable duty owed to Sean. 44 It was conceded in the trial that Mr Dobie, as a person exercising control over the group including Sean, should have taken better care of the children in the group when the group was taken close to and across a busy road. 45 The evidence did not establish "what if any relationship existed" between Mr Dobie and Mr Ivanov and Sean was not assisted in this respect by Mr Ivanov's admission. The evidence did not demonstrate a relationship of employer and employee between them. His Honour nevertheless concluded that Sean was entitled "to rely on a non delegable breach of duty by [Mr Ivanov] as the person responsible for the conduct of the Rhee Tae Kwon Do classes in which he was enrolled". 46 His Honour referred to the principles set out in Introvigne and Kondis v State Transport Authority 47 in determining that the present situation was analogous to the school situation in Introvigne so that Mr Ivanov, as owner of the academy Sean was attending when he was injured as a result of Mr Dobie's negligence, owed the eight year old Sean a duty of care in the performance of activities associated with the classes. Mr Ivanov failed to ensure that reasonable care was taken in the performance of those activities, 48 and so breached that duty. Discussion and conclusion Could the judge act on Mr Ivanov's admission? [50] Mr Ivanov, in contending that the judge erred in relying on the admission in paragraph 3(i) of his defence as it was contrary to the evidence at trial, relies on Damberg v Damberg. 49 In that case the New South Wales Court of Appeal did not rely on a view of applicable foreign law agreed by the parties where that view was shown to be incorrect. [51] Mr Ivanov gave evidence inconsistent with the admission but he was permitted to do so, not to gainsay the admission, but to explore his relationship with Mr Dobie. This was relevant to Sean's claim alleging Mr Ivanov's vicarious liability as Mr Dobie's employer, a claim rejected by the primary judge. 50 [52] The admission was proof of the facts in it. Mr Ivanov's application to withdraw it was rightly dismissed. Mr Ivanov did not appeal from the order. The issues in dispute were narrowed according to the admission. The trial was conducted on the basis that on 30 October 1989, Sean, then eight years old, was enrolled as a tae kwon do student at the "Rhee Tae Kwon Do" academy which was then owned and operated by Mr Ivanov at premises at St Mark's Hall and at 45 Ingham Road. The admission was able to prevent evidence being adduced to contradict or qualify it: Damberg Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [64]. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [66]. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [67]. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [69]. (1984) 154 CLR 672; [1984] HCA 61 at [30], [32]-[33]. Fitzgerald v Hill & Suncorp Metway & Ors [2007] QSC 228 at [73]. (2001) 52 NSWLR 492; [2001] NSWCA 87 at [157]-[163]. Fitzgerald v Hill and Suncorp Metway & Ors [2007] QSC 228 at [68]. (2001) 52 NSWLR 492; [2001] NSWCA 87 at 519 [154].

17 17 [53] This was not a case of the sort referred to in Damberg 52 where the evidence at trial raised real concerns about the correctness of the facts admitted. The evidence at trial in the present case must be viewed on the basis that Sean, as the claimant relying on the admission, did not have to call evidence to prove those facts. Although Mr Ivanov in his evidence sought to gainsay the admission in exploring the issue of his relationship with Mr Dobie, 53 there was a significant body of evidence supporting the admission. The telephone number in the Yellow Pages directory and on the sign outside St Mark's Hall gave only Mr Ivanov's phone number as the contact for St Mark's Hall academy. Mr Service, who was a member of Sean's class on 30 October 1989, knew Mr Ivanov as the chief instructor of Rhee Tae Kwon Do; Mr Ivanov operated out of Ingham Road. Ms Gandini was also a member of Sean's class. She said that Mr Ivanov was the "head" of the "main gym" at Ingham Road and that was where she made a statement about the events of 30 October 1989 shortly after Sean's accident. Mr Morf, another member of the class, joined Rhee Tae Kwon Do at Ingham Road and commenced classes there with Mr Ivanov whom he also described as "the chief instructor". He then attended classes at both St Mark's Hall and Ingham Road; one payment covered his classes at both venues. Mr Dobie in a statement dated 31 October 1989 noted that when he completed his work at St Mark's after the accident he "went to the Nth. Qld. Headquarters of Rhee Tae-kwondo to advise the Chief Instructor of the accident". Sean's photograph for his enrolment form was taken at Ingham Road and that was where he did his tae kwon do gradings. The letter of 28 May 2003 from Mr Ivanov's solicitor to Sean's solicitor (ex 36) also supported the admission. Unlike in Damberg, the evidence at trial did not demonstrate that the contentious admission was wrong. [54] Furthermore, Damberg did not involve, like the present case, an admission of fact made by a party under the UCPR for the purposes of clarifying the true issues in dispute between parties to shorten and make less expensive the conduct of litigation. The judge was entitled to rely on the admitted facts in reaching his decision. This ground of appeal fails. The law relating to non-delegable duty of care [55] Over 40 years ago, the High Court considered in Ramsey v Larsen 54 the question of whether the government of New South Wales could be held legally responsible for a school teacher's negligence causing damage to a pupil. The 12 year old plaintiff was injured when he fell out of a tree at the state school which he attended. He claimed his injuries were attributable to the teacher's negligence and brought an action against the State of New South Wales to recover damages. The case was determined in favour of the child on the issue of what is now known as vicarious liability. 55 Kitto J's analysis of the case, however, has provided the Australian source for the tortious concept of breach of a non-delegable duty of care. His Honour noted: " the duty to take care of a pupil is not normally the personal duty of the teacher alone. In the absence of a special arrangement to the contrary, it is, I think, the necessary inference of fact from the acceptance of a child as a pupil by a school authority, whether the (2001) 52 NSWLR 492; [2001] NSWCA 87 at 520 [160]. See also the statement of Mr Dobie's deceased wife dated 21 June 2006 (exhibit number 33A). (1964) 111 CLR 16; [1964] HCA 40. (1964) 111 CLR 16; [1964] HCA 40 at (Taylor J, Windeyer and Owen JJ agreeing).