Alexander v Perpetual Trustees Wa Ltd

[2004] HCA 7
(2004) 78 ALJR 411
(2004) 204 ALR 417
(2004) 216 CLR 109

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(Judgment by: Kirby J)

Alexander
vPerpetual Trustees Wa Ltd

Court:

Judges: Gleeson CJ
McHugh J
Gummow J

Kirby JHayne J
Callinan J

Legislative References:
Civil Liability (Contribution) Act 1978 (UK) - The Act
Trustee Companies Act 1987 (WA) - The Act
Trustee Companies Act 1964 (NSW) - The Act
Fair Trading Act 1985 (Vic) - The Act
Wrongs (Contribution) Act 1985 (Vic) - The Act
Chancery Procedure Act 1852 (UK) - The Act
Fair Trading Act 1985 (Vic) - s 11
Wrongs Act 1958 (Vic) - s 23B; s 23B(1); Pt IV
Law Reform (Married Women and Tortfeasors) Act 1935 (UK) - The Act
Law Reform (Miscellaneous Provisions) Act 1946 (NSW) - s 5
Trade Practices Act 1974 (Cth) - s 87(1A)

Hearing date:
Judgment date: 12 February 2004

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Judgment by:
Kirby J

[69] Where the acts or omissions of a number of parties contribute to the damage suffered by another, a rational system of law would provide a means by which those responsible for such damage were obliged to share the burden as between each other in a just and equitable way, having regard to the extent of their respective responsibilities for the damage. The apportionment might not be capable of being performed with scientific precision because of the diversity of the several responsibilities and the scope for different assessments of the requirements of justice and equity in the case. But the fundamental notion of contribution is a simple one. In an ideal world it would not be "defeated by too technical an approach" ^[48] .

[70] Decisions of the courts, including recent decisions of this Court ^[49] , demonstrate that, in the quest for distributive justice, in cases involving liability of several parties to a common plaintiff, impediments are often thought to arise that defeat the object of contribution ^[50] . So it has proved in giving effect to early contribution legislation designed to overcome legal impediments ^[51] . And so it has proved in claims for equitable contribution between co-obligors ^[52] . It is as if the legal mind, locked in its categories, is fundamentally resistant to the notion of distributive justice as between parties liable, in different legal ways, to a common plaintiff.

[71] The present appeal is the latest instance of resistance to the simple idea of contribution. "Gallons of ink" have been spilt over earlier versions of contribution legislation. Despite a new attempt by the Parliament of Victoria to make its reformatory will clear, it seems that the flow of ink will not be stemmed.

The facts

[72] The background facts : The basic facts are described in the reasons of Gleeson CJ, Gummow and Hayne JJ ("the joint reasons") ^[53] and in the reasons of Callinan J ^[54] . Although, in their detail, the facts are complicated, reduced to essentials, they are comparatively simple.

[73] The Perpetual Companies ("Perpetual") were trustees of superannuation funds. They were directed by members of the funds ("the beneficiaries") to invest large sums in preference shares offered to the market by a company ("ECCC"). Minter Ellison ("Minters"), a firm of lawyers, acted in that capacity for ECCC. As security for the deposits with that company, a deposit certificate was to be issued by a reputable bank, in the form of a bearer certificate of the deposit, a guarantee or letter of credit. The security documents were drafted by Minters. It also acted as agent for Perpetual. Perpetual paid the funds into the trust account of Minters. Minters was obliged not to release the funds to ECCC until the deposit certificates were issued. However, without provision of the certificates, Minters released the funds to ECCC. With each such payment, Minters incorrectly represented to Perpetual that it had received the deposit certificate. It transmitted purported "certificates" to Perpetual for safe custody.

[74] Neither Minters nor Perpetual checked the documents so forwarded in a careful and prudent way, conforming to their respective duties as trustees. Had they done so, each would have recognised that no deposit certificates had been issued and that the beneficiaries therefore had no recourse to a bank to safeguard their investments. In the result, when ECCC became insolvent, the beneficiaries' funds were lost. The beneficiaries sued Perpetual for breach of the terms of the trust upon which Perpetual had received the funds from them. Perpetual, in turn, sued Minters for breach of the terms of the trust upon which Minters had received the deposits from Perpetual. Each of these claims succeeded. A claim that Minters had contravened provisions of the Fair Trading Act 1985 (Vic) by making misrepresentations to Perpetual that constituted misleading and deceptive conduct, was also successful. These findings are not now in dispute.

[75] The substantial issue before this Court is whether Minters is entitled to contribution ^[55] from Perpetual and whether it is "just and equitable having regard to the extent of [Perpetual's] responsibility for the damage" ^[56] that Perpetual should share the ultimate burden for the common damage for which the liability of each had been, or could be, established ^[57] .

[76] Common ground : Further background to this sorry chronicle may be found in an earlier decision of this Court ^[58] . For the purposes of this appeal numerous points were either common ground or excluded by the limited grant of special leave. Thus, it was not now disputed that the contribution rights and obligations of Minters and Perpetual, although determined in the Supreme Court of New South Wales, were to be decided by the application of the Wrongs Act 1958 (Vic). That Act was to be applied as it was amended by the insertion in Pt IV ("Contribution") of a series of provisions adopted by the Victorian Parliament in 1985 ^[59] . Likewise, in so far as the claim was based on statute for misleading and deceptive conduct on the part of Minters towards Perpetual, it was to be determined in accordance with the Fair Trading Act ^[60] . The operation of those two Victorian statutes in the circumstances and their application by the Supreme Court of New South Wales are not now contested.

[77] The test for liability to contribution, under the Wrongs Act, as between Perpetual and Minters was not limited to the liability that had been legally established between the beneficiaries and Perpetual. As with earlier versions of the contribution legislation ^[61] , the Wrongs Act does not confine the right to contribution to liability already proved as between the putative contributor and the original plaintiff. It would scarcely be just or sensible if that were so. It would, in effect, render a claimant for contribution hostage to the way in which another person defined its claim. The Wrongs Act recognises that the claimant for contribution is entitled to recover not only for "such liability which has been ... established" but also "such liability which ... could be established in an action brought against that person in Victoria by or on behalf of the person who suffered the damage" ^[62] .

[78] In this sense, as between a claimant for contribution and a putative contributor, the issue presented by the claim under the Wrongs Act is, in part, determined by any proceedings that have been brought and, in part, by an answer to the hypothetical question of what "could be established" if such proceedings had been brought.

The legislation

[79] Original statutory reform : The Law Reform (Married Women and Tortfeasors) Act 1935 (UK) was the first statutory attempt to reform the law of contribution in England ^[63] . That Act was quickly copied throughout the British Empire, including in Australia. However, a defect of the statutory reform (apart from its ambiguous expression) was that it was limited to recovery of contribution as between tortfeasors, that is, "[w]here damage is suffered by any person as a result of a tort" ^[64] .

[80] Such was the earlier law in Victoria ^[65] . Such is still the law in the majority of Australian jurisdictions ^[66] . Those who suggest that judges should take a passive role, indifferent to the need to update remedies available at common law and in equity, do well to reflect upon the long saga of apparent parliamentary indifference and neglect disclosed by the general legislative inattention to the oft-demonstrated defects in the original contribution legislation. If ever there was an illustration of the need for appropriate judicial steps to facilitate just remedies as between parties, this is it.

[81] Further English reform : In England (whence, it seems, Australian lawmakers still derive their comparatively rare bursts of imagination in such matters), the Law Commission in 1975 proposed a series of reforms designed to repair some of the larger defects in contribution as between tortfeasors and to broaden the "statutory jurisdiction to make contribution orders [beyond] situations in which the claims arise out of tort ... to cover breaches of contract, breaches of trust and other breaches of duty as well" ^[67] .

[82] Unsurprisingly, the Law Commission's proposal was well received in the English legal profession and community. In consequence, in 1977, the Commission produced its Report on Contribution ^[68] . Although the report was delivered in the context of the Commission's then general review of the law of contract and quasi-contract, the proposals were much broader. Most significantly, it endorsed the expansion of the applicability of statutory compensation to "wrongdoers other than tortfeasors" ^[69] . In support of the Commission's recommendation, it pointed to the "double advantage" of expanding the entitlement to contribution in such a way ^[70] :

First, it closes the gap where there are no rights of contribution at common law. Second, it allows the courts greater flexibility where the existing rules would otherwise work unjustly. The proposal has won general support from those who commented on our working paper and we accordingly recommend that it should be given legislative effect.

The Commission said that it could see "no policy reason" for leaving the previous gap in the entitlement to contribution "unfilled" ^[71] .

[83] Reform in Victoria : In Victoria, the question whether the recommendations of the English Law Commission should be adopted in the Wrongs Act was considered by a sub-committee of the Chief Justice's Law Reform Committee. With an immaterial reservation, that Committee recommended the adoption in Victoria of the Law Commission's proposals ^[72] . The Committee noted that, by the time of its report, the proposals had passed into law in England ^[73] .

[84] Whilst remarking on a possible divergence between the law of Victoria and that of England on the subject of the availability of contributory negligence as a defence to a claim of damages for breach of contract ^[74] and offering some criticisms of the drafting of the English statute, the Committee recommended adoption of the substance of the Law Commission's reforms in Victoria. In the House of Lords in the United Kingdom Parliament, Lord Scarman and the Lord Chancellor made speeches supporting the passage of the English legislation. The latter pointed out that "[t]he present law on contribution has ... led to injustice by failing to provide all the remedies that are required" ^[75] . The Bill was described as "a measure of law reform and ... a step further to improve the quality of justice" ^[76] . The basic principle of contribution was explained in terms similar to those that I have set out at the head of these reasons. In due course, in terms of the amendments to the Wrongs Act, the Victorian Parliament enacted the amendments to the law of contribution adapted from the English model ^[77] .

[85] Significance of the reform : The initiative of the Victorian Parliament to carry into law the reform of statutory contribution and to expand the availability of such contribution beyond that between tortfeasors so as to embrace coordinate liability on "whatever ... legal basis", including for "breach of trust" ^[78] , should not be whittled down by this Court. I have included the foregoing history of the enactment of the reforms to the law of contribution in Victoria for three purposes. First, to demonstrate beyond doubt the remedial and reformatory character of the legislation so enacted. Secondly, to indicate the deliberate purpose that lay behind the adoption of the reforms in Victoria, so far the only jurisdiction to do so in Australia ^[79] . And thirdly, to highlight the error that arose in the Court of Appeal of New South Wales in these proceedings. There, in the original reasons published by that court for rejecting Minters' claim to contribution, two of the judges made no reference whatsoever to the Wrongs Act. Only Davies AJA cited the Act, and then only in describing the claims brought by Minters ^[80] .

[86] It was the omission of the Court of Appeal to make any substantive reference to Minters' reliance on the enlargement of the right to contribution provided by s 23B of the Wrongs Act that led to a notice of motion by Perpetual seeking supplementary reasons for judgment dealing with the point. Supplementary reasons were later published ^[81] . The reconsideration did not cause the Court of Appeal to alter its opinion or (if it was still possible at that stage) its orders.

[87] In busy courts, it is easy enough to overlook points, as I have myself done. However, this appeal is yet another instance of the phenomenon, all too common, for Australian lawyers and courts to attempt to resolve novel disputes by reference to judicial elaboration rather than the text of an applicable statute. This Court has drawn this tendency to notice more times than I care to remember ^[82] . The present is a classic illustration.

[88] Instead of analysing the meaning, application and purpose of the reformatory provisions of the Wrongs Act, the learned judges of the Court of Appeal (even, in my respectful opinion, in their supplementary reasons) focussed upon judicial exposition. It is important that this Court should not make the same mistake. The amendments to the Wrongs Act introduce deliberate and important reforms to the written law. They require of judges a fresh look at the availability of contribution, freed from restrictions earlier devised by judges which, in part, the remedial provisions were designed to overcome. Where there is written law, as here, our duty is to the text and purpose of the legislature ^[83] . Especially where new written law is adopted following a careful law reform process, it is essential that courts should not adopt a restrictive interpretation that undermines the attainment of the reform, to the full extent possible in the statutory language.

Analysis of the amended Wrongs Act

[89] Adoption of broad language : The breadth of the intended operation of the 1985 reform of the Wrongs Act is made clear by the language in which the new provisions are expressed ^[84] .

[90] First, some observations need to be made about the interaction of the provisions. Take s 23A(1) of the Act with its definition of "a person [who] is liable", as referred to in s 23B(1). The ambit of the new provision takes its colour from the purpose, which is stated to be to provide for "contribution". That word appears, without relevant restriction, in the heading to Pt IV of the Wrongs Act. The legislative history evinces a clear object to enlarge the facility of orders for contribution. Then, the fact that, by s 24(2), that facility is committed to a court or, where applicable, a jury instructed by a judge, indicates that a large latitude is intended, subject to appeal, as may be contemplated by the now wide circumstances to which contribution is made applicable. Then, the criterion in s 24(2) of what is "just and equitable having regard to the extent of that person's responsibility for the damage" reinforces the breadth of the intended operation of the remedy. As previously stated, by s 23B(6), the remedy is to be available not only where liability has been established but also where it "could be established in an action brought ... in Victoria".

[91] These general observations about Pt IV of the Wrongs Act are further reinforced when one turns to the actual language of the critical provisions. Thus, in s 23A, the words " any damage" suggest that it is not necessary to establish a strict coincidence between the damage caused by the claimant for contribution and that caused by the putative contributor if some part of the damage in question coincides. Then, the claimant for contribution is entitled to recover "compensation" (as it is expressed) from the putative contributor not necessarily to the extent of the entire "damage". All that is required is that the claim should be " in respect of that damage". The breadth of the phrase "in respect of" is established by so much decisional authority that I am almost embarrassed to mention the point ^[85] . The words of connection chosen by the legislature deny any suggestion that there must be exact identity of the liability for the damage.

[92] The foregoing impressions are then reinforced by the wide ambit introduced by the 1985 reforms. Contribution is now available beyond "tort". It extends to "breach of contract, breach of trust or otherwise". The reference to "breach of trust" is itself remarkable. It takes the operation of statutory contribution far beyond tort and that other part of the law of obligations, contracts and quasi-contracts. It provides a statutory remedy in the case of "breach of trust" and "otherwise" where, formerly, only the remedy of equitable contribution would have been available, with its encrustations, recently demonstrated and reaffirmed, over my objection ^[86] .

[93] The fact that, in a particular case, the foundation of a claim for contribution might derive from two or more bases of liability, such as tort, breach of trust or breach of statutory duty, indicates that it is a serious mistake to attempt a return to the pre-1985 strictness of coordinate liability, which this Court has held to be necessary in a case of equitable contribution. Under the Wrongs Act, the amplitude and multiplicity of the possible bases of liability make it clear that no narrow view is to be adopted in defining a person liable in respect of the "damage".

[94] But this is not all. Section 23B(1) is similarly expressed in very wide terms. Again, it is sufficient that the person claiming contribution be "liable in respect of any damage suffered by another person". Again, it is unnecessary to establish an exact coincidence of the damage for which the claimant and the putative contributor are responsible. Likewise, the contemplation of contribution "from any other person" emphasises the breadth of the class of putative contributors. Then comes the phrase "liable in respect of the same damage ". To the suggestion that these words cut back the ambit of the class of potential contributors, the answer appears in the breadth of the definition incorporated in s 23B(1) by force of s 23A(1), as I have just explained. That ambit is still further reinforced by the words in parenthesis, referring to the alternative possibilities that the claimant for contribution and the putative contributor are jointly liable to the first person (in this case the beneficiaries) "or otherwise". The reference to "otherwise" clearly means that the claimant and the putative contributor may be severally liable; liable in respect of different parts of the "damage"; liable on different legal bases ("whether tort, breach of contract, breach of trust ... "); liable by statute (" ... or otherwise"); and liable whether such liability is established or is such as could be established if an action were brought.

[95] Same " damage " not " cause of action ": It is very important to notice that neither s 23A(1) nor s 23B(1) states, or suggests, that the liability "in respect of the same damage " must arise out of identical causes of action , on the part of the "first-mentioned person". On the contrary, the language, purpose and history of the reformed provisions of the Wrongs Act make it abundantly clear that this need not be so. It would have been easy for the United Kingdom Parliament (and the Victorian Parliament copying it and the law reform bodies that recommended the reform) to impose in clear terms a requirement of exactly coincident liability and sources of liability. Instead, the reforms and the statutes giving them effect focussed, and focussed only, on the "damage". It is the liability "in respect of the same damage " that is critical. Thus, in the application of the provisions of the Wrongs Act, the starting point is to find the "damage" "in respect of" which the claim for contribution is made. So long as that "damage" coincides, sufficiently in the context of a reformatory provision contemplating multiple and distinct causes of action giving rise to liability for the damage, the precondition for statutory contribution exists.

[96] In this analysis, I therefore agree with the approach of Callinan J in this appeal ^[87] , with which McHugh J agrees ^[88] . Minters was found to have engaged in misleading and deceptive conduct in contravention of the Fair Trading Act. Perpetual was found to have breached duties owed as trustee to the beneficiaries. Each was responsible (albeit in differing ways) for the same damage, that is, the loss of the beneficiaries' funds invested in ECCC. I disagree with the approach stated in the joint reasons ^[89] . In my view, it is erroneous to import into the requirement of liability "in respect of the same damage" any notion that suggests that such liability must be a common liability to a common plaintiff, based on the same legal category or source of liability. Upon this view, the fact that there were two (even in some cases three) "levels of trusts" ^[90] is irrelevant. To introduce that notion, and to assign statutory significance to it, is to mistake the instruction of the reformed legislation, which addresses the identity of the "damage", not the identity of its legal or equitable foundation.

[97] Conclusion - contribution legislation applies : In the circumstances of this appeal, for the purposes of the claim for contribution, the "damage" was relevantly "the same". It was the loss suffered by the beneficiaries because neither Minters nor Perpetual performed carefully and faithfully the duties severally cast on each of them by law. Both of them were persons liable within s 23A(1). Both were therefore liable to contribute to the damage.

[98] By this analysis, within s 23B(1), Minters was a person liable "in respect of" any damage suffered by the beneficiaries, on the footing that the beneficiaries were entitled to recover compensation from Minters "in respect of" that damage, whatever the legal basis of liability. In such circumstances Minters, in accordance with s 23B(1), was entitled to recover compensation from Perpetual, being an "other person" liable "in respect of" the same damage, although severally not jointly, with Minters and on a basis, if necessary, different from the basis upon which Minters was itself liable.

[99] The foundations for the liability of Minters and Perpetual "in respect of" the same damage comprised their several liabilities, which included liability arising out of breach of the Fair Trading Act and breach of trust. I agree with what Callinan J has written in this respect ^[91] . His Honour's approach ensures the sensible operation of the Wrongs Act in circumstances of successive breaches of statutory duty and of trust by each of the claimant for contribution (Minters) and the putative contributor (Perpetual) respectively. The alternative and narrower view, preferred in the joint reasons, defeats the achievement of an obvious purpose of the reform to statutory contribution in a way that is unnecessary in the language by which the statute is expressed and contrary to its purpose.

[100] In summary, to the extent that there is any uncertainty or ambiguity in the provisions of the Wrongs Act, I would prefer the approach of Callinan J because it achieves the object of the reform. It prevents yet another remedial statute from misfiring because of the way a court reads it. It is time, wherever possible, to lift the dead hand of the past from the law of contribution. That, as I take it, was the purpose of the 1985 amendments to the Wrongs Act. This Court should give effect to that purpose.

A "just and equitable" apportionment of responsibility?

[101] Is contribution bound to fail ? There are two remaining arguments of Perpetual that need to be addressed. The first arises out of a conclusion of Davies AJA, in his supplementary reasons in the Court of Appeal, providing a second, and alternative, basis for rejecting Minters' claim for contribution. This was his Honour's statement ^[92] (with which Ipp AJA agreed without separate reasons ^[93] ) that, in the circumstances of the case, "it was not just and equitable that an order for contribution be made against [Perpetual]". This conclusion was put forward on the basis that Perpetual was "entitled to be fully indemnified by [Minters] in respect of any damages which might otherwise fall within the application of the statutory provisions" ^[94] .

[102] It must be conceded that there is an important question to be determined concerning the extent of Minters' entitlement to contribution from Perpetual under the Wrongs Act, even within the open-ended formula of that Act, with its reference to what is "just and equitable having regard to the extent of [the putative contributor's] responsibility for the damage" ^[95] .

[103] At trial, Rolfe J observed that contribution was not available because "[t]he damage springs from different breaches and there is no co-ordinate liability" ^[96] . I have already endeavoured to show that this approach was in error. However, his Honour went on to state that, if the case "turned on the negligence of [Minters] then, in my opinion, it would be appropriate to consider whether [Perpetual] had been guilty of contributory negligence" ^[97] . By reference to what he had held in deciding the liability of Perpetual to the beneficiaries, Rolfe J concluded that, approached in such a way, he would have "apportioned the damages as to 40% and 60% respectively", that is, as to Perpetual and Minters ^[98] .

[104] Perpetual suggested that there were fundamental flaws in accepting this approach, even if his Honour was wrong in treating contribution as unavailable under the Wrongs Act or otherwise. Thus, Perpetual invoked the recent observations of this Court concerning the inadmissibility of notions of contributory negligence when deciding the scope of a fiduciary's duty to a beneficiary ^[99] and the basic principle that a fiduciary's liability to a beneficiary for breach of trust is one of restoration ^[100] . That the fiduciary's duty is to make good breaches arising from its default in discharging the fiduciary obligation is not in doubt ^[101] . As McLachlin J explained in Canson Enterprises Ltd v Boughton & Co ^[102] , this is because "[t]he fiduciary relationship has trust, not self-interest, at its core, and when breach occurs, the balance favours the person wronged. ... In short, equity is concerned, not only to compensate the plaintiff, but to enforce the trust which is at its heart."

[105] Is it therefore self-evident (as Davies AJA appeared to consider) that a claim by Minters for contribution from Perpetual is bound to fail because to uphold it would work a fundamental offence to the liability of a trustee to restore the damage suffered by its beneficiary, that is, Perpetual to the beneficiary plaintiffs and Minters to Perpetual as its beneficiary?

[106] Futility is not established : In this Court, Perpetual relied upon the conclusion of the majority of the Court of Appeal that, if it came to the assessment of what was "just and equitable", Minters would still recover no contribution. I accept that this argument needs to be dealt with. However, ultimately, for a mixture of procedural and substantive reasons, I would not decide the appeal on this basis.

[107] First, when special leave was granted to Minters, it was made clear that this Court would not embark upon any question of apportionment and that the notice of appeal had to be amended to reflect this limitation, as indeed it was. The amended notice of appeal omits the ground of appeal challenging the conclusions of the courts below determining the amount of compensation recoverable. Minters thus tendered to this Court only an issue of legal principle concerning the availability of recovery under the Wrongs Act. It asked that, if that principle were determined in its favour, the extent of any recovery should be remitted to the Supreme Court. In view of these developments, that is the course that should be taken.

[108] Secondly, and in any case, once it is decided (as I would conclude) that the Wrongs Act applies to the respective liabilities of Minters and Perpetual, it is arguable that no pre-existing doctrine of equity or of unwritten law concerning the liability of trustees ousts the statutory prescription. Although addressed to the kind of apportionment which he would have made in a case of coordinate liability in negligence, Rolfe J's assessment of the respective "responsibilities" for the damage of Minters and Perpetual, in the sense of the causes of the ultimate loss of the moneys deposited by the beneficiaries (namely 60% Minters and 40% Perpetual) suggests that there might yet be utility in considering the application of the Wrongs Act.

[109] The very broad criteria expressed in the Act, once it attaches, read against the background of Rolfe J's comment, suggest that a proper application of the Act might result in orders for contribution of a substantial kind. In so far as the earlier reasons of the Court of Appeal were addressed to the issue of equitable contribution, in circumstances requiring coordinate liability, they were not directed to the statutory question presented by s 24 of the Wrongs Act. This is what is "just and equitable having regard to the extent of ... responsibility for the damage ". It is arguable that the statute releases the decision-maker from the strictness of the old law. It is possible that it enlivens a large quasi-discretionary decision by reference to a more broadly stated criterion. None of these points has yet been decided by the Court of Appeal. Still less, having regard to the grounds of appeal, are they before this Court.

[110] I would therefore reject the first of Perpetual's "threshold" arguments for upholding the judgment of the Court of Appeal on the alternative conclusion stated by Davies AJA. It would be procedurally unfair, and premature, for this Court to decide the matter on such an argument. It is not obvious that the argument would prove fatal to Minters in the application of the Wrongs Act.

The argument of "indemnity" fails

[111] Exclusion of other indemnities : More troubling is Perpetual's second "threshold" argument, advanced on the assumption that the provisions of the Wrongs Act were otherwise enlivened. This was that Perpetual was entitled, in the circumstances, to exclude the operation of the contribution provisions of the Wrongs Act on the basis of s 24AD(4) of that Act. There was no procedural impediment to considering this point. Indeed, it is involved in the issue of whether the Wrongs Act applies at all; and if so how.

[112] The subsection in question reads, relevantly (with emphasis added):

(4)

The right to recover contribution in accordance with section 23B supersedes any right, other than an express contractual right, to recover contribution (as distinct from indemnity) otherwise than under this Part in corresponding circumstances but nothing in this Part shall affect --

(a)

any express or implied contractual or other right to indemnity ...

...

which would be enforceable apart from this Part ...

[113] Perpetual's argument invoked reflections of the point just dealt with. It drew upon the strict legal and equitable obligations that have hitherto governed trustees in relation to their beneficiaries in respect of breaches of trust; the restitutory principle governing the obligations of trustees; and the irrelevance, in that context, of notions of "contributory negligence" or "contributing fault" on the part of a beneficiary ^[103] .

[114] Because the general duty of the fiduciary has been expressed as one to "make good any losses arising from the breach" ^[104] , Perpetual argued that, as against Minters, it was entitled to a full replenishment of the trusts together with compound interest ^[105] . It submitted that this was, within s 24AD(4)(a) of the Wrongs Act, an "other right to indemnity" that "would be enforceable apart from [Pt IV of the Wrongs Act]". On that basis, Perpetual submitted that the Wrongs Act preserved the beneficiary's "right to indemnity" from its defaulting trustee. So preserved, the duty of Minters (as trustee) to Perpetual (as beneficiary) ousted any entitlement that might otherwise arise for contribution as between Minters and Perpetual pursuant to s 23B of the Wrongs Act.

[115] For its part, Minters argued that an "indemnity" comprised a promise. As such, s 24AD(4) was not concerned with the preservation of the rights of a beneficiary deriving from the law of trusts and not from any express or implied promise. It is true that indemnities commonly arise from promises of various kinds ^[106] . There are some indications in the language of s 24AD(4) that the subsection was concerned with contractual indemnities, these being expressly referred to in paras (a) and (b). However, the use of the words "or other" to signify that other (non-contractual) rights to indemnity were included, suggests that the subsection is not limited to express or implied promises. Statutory indemnities give rise to non-promissory obligations ^[107] . Such was the construction urged by Perpetual in the context of s 24AD(4). On that footing, Perpetual submitted that its entitlement to "indemnity" excluded any entitlement of Minters to contribution pursuant to s 23B(1) of the Wrongs Act.

[116] Contribution is not bound to fail : I am not convinced that s 24AD(4) of the Wrongs Act has the effect claimed by Perpetual. It is not conventional to describe the rights of a trustee to follow trust money into the hands of another with notice of the trust as an "indemnity" ^[108] any more than to describe the beneficiary's entitlement against a defaulting trustee as one of "indemnity". The rights of beneficiaries in relation to trustees are usually described, by reference to equitable principles, in terms of restoration or restitution. Because of the nature of equity and the purposes and flexibility of its remedies, the more mechanical legal notion of "indemnity" fits somewhat uncomfortably with the enforcement of a trustee's obligations to beneficiaries. The elliptical phrase "or other right to indemnity" is not, therefore, facially apt to import the obligations owed by a trustee (Minters) to a beneficiary (Perpetual). It would follow that s 24AD(4) is not enlivened by this case. An earlier suggestion by Minters of a contractual indemnity was rejected. It has not been reagitated in this appeal.

[117] Even if the foregoing conclusions were incorrect, it is important to note the limited operation of s 24AD(4), according to its terms. It does not "exclude" any entitlement to contribution. In that sense, the language of s 24AD(4) is to be contrasted with that of the former template ^[109] . All that s 24AD(4) provides is that nothing in Pt IV of the Wrongs Act affects any implied contractual or other right to indemnity. Upon this view, the suggested "indemnity" in the form of the trustee's obligation of restoration to the beneficiary remains. But arguably, it would still fall to be evaluated, in a case to which s 23B(1) of the Wrongs Act applies, by the very broad formula stated in s 24(2) of that Act ^[110] .

[118] The formula in s 24(2) of the Wrongs Act, being stated in legislation, is superimposed upon earlier equitable doctrine governing trustees' obligations to beneficiaries. That doctrine remains to be taken into account in identifying the damage shared between Minters and Perpetual and in coming to a conclusion of what is "just and equitable having regard to the extent of [Perpetual's] responsibility". Arguably, the "responsibility" in question is no longer simply that of a trustee to the beneficiary. It is the "responsibility" for the "damage" which has been suffered "by another person" (here, the plaintiff beneficiaries). In short, upon this view, the mind of the decision-maker is released from the former categories and rules of equity governing the duties of trustees to their beneficiaries. Instead, the decision-maker is invited, once the Wrongs Act is engaged, to stand back and make the broad judgment of "responsibility for the damage" which s 24(2) commands. Given the unsatisfactory history of contribution, that would not be an entirely surprising outcome.

Conclusions and orders

[119] No one in this case has yet performed in a satisfactory fashion the function envisaged by the Wrongs Act, given the view that has been taken that contribution is unavailable both under that Act and by the rules governing equitable compensation. In this appeal Minters has, in my view, made good its complaint that the courts below failed to apply the provisions of the Wrongs Act, as the terms of that Act oblige. It is therefore necessary to return this aspect of the proceedings to the Supreme Court for the proper application of the widened language of the Wrongs Act to Minters' claim for contribution from Perpetual. Such application would permit a proper determination of Perpetual's two "preliminary" points that I have just mentioned. A consideration of those points at this stage does not suggest that Minters' claim under the Act is futile.

[120] I agree in the orders proposed by Callinan J.