Torts [8th edition.] 9780409344967, 0409344966

Citation preview

FOCUS Torts Eight Edition

FOCUS Torts Eight Edition

Martin Davies Admiralty Law Institute Professor of Maritime Law, Tulane University Law School, New Orleans Director, Tulane Maritime Law Center Professorial Fellow, Melbourne Law School, University of Melbourne

Ian Malkin Director, JD Program Professor, Melbourne Law School, University of Melbourne Chair, University of Melbourne Teaching and Learning Quality Assurance Committee

LexisNexis Butterworths Australia 2018

AUSTRALIA ARGENTINA AUSTRIA BRAZIL CANADA CHILE CHINA CZECH REPUBLIC FRANCE GERMANY HONG KONG HUNGARY INDIA ITALY JAPAN KOREA MALAYSIA NEW ZEALAND POLAND SINGAPORE SOUTH AFRICA SWITZERLAND TAIWAN

LexisNexis LexisNexis Butterworths 475–495 Victoria Avenue, Chatswood NSW 2067 On the internet at: www.lexisnexis.com.au LexisNexis Argentina, BUENOS AIRES LexisNexis Verlag ARD Orac GmbH & Co KG, VIENNA LexisNexis Latin America, SAO PAULO LexisNexis Canada, Markham, ONTARIO LexisNexis Chile, SANTIAGO LexisNexis China, BEIJING, SHANGHAI Nakladatelství Orac sro, PRAGUE LexisNexis SA, PARIS LexisNexis Germany, FRANKFURT LexisNexis Hong Kong, HONG KONG HVG-Orac, BUDAPEST LexisNexis, NEW DELHI Dott A Giuffrè Editore SpA, MILAN LexisNexis Japan KK, TOKYO LexisNexis, SEOUL LexisNexis Malaysia Sdn Bhd, PETALING JAYA, SELANGOR LexisNexis, WELLINGTON Wydawnictwo Prawnicze LexisNexis, WARSAW LexisNexis, SINGAPORE LexisNexis Butterworths, DURBAN Staempfli Verlag AG, BERNE LexisNexis, TAIWAN

UNITED KINGDOM USA

LexisNexis UK, LONDON, EDINBURGH LexisNexis Group, New York, NEW YORK LexisNexis, Miamisburg, OHIO

National Library of Australia Cataloguing-in-Publication entry

Creator: Title: Edition: ISBN: Series: Notes: Subjects:

Other Creators/Contributors:

Davies, Martin, 1957–. Torts/Martin Davies, Ian Malkin. 8th edition. 9780409344967 (pbk). 9780409344974 (ebk). Focus Series. Includes index. Torts — Australia. Reasonable care (Law) — Australia. Trespass. Libel and slander. Malkin, Ian, 1957–.

© 2018 Reed International Books Australia Pty Limited trading as LexisNexis. First edition 1992; reprinted 1993 and 1995; second edition 1995; reprinted 1997 and 1998; third edition 1999; reprinted 2000, 2001 (twice) and 2002; fourth edition 2003; reprinted 2005 and 2007; fifth edition 2008; sixth edition 2012; seventh edition 2015. This book is copyright. Except as permitted under the Copyright Act 1968 (Cth), no part of this publication may be reproduced by any process, electronic or otherwise, without the specific written permission of the copyright owner. Neither may information be stored electronically in any form whatsoever without such permission. Inquiries should be addressed to the publishers. Typeset in ITC Slimbach Std and Helvetica Neue LT Std. Printed in China. Visit LexisNexis Butterworths at www.lexisnexis.com.au

About the Authors Martin Davies is Admiralty Law Institute Professor of Maritime Law at Tulane University Law School in New Orleans. Although he has lived in the United States since 2000, he continues to teach and write in Australia. He is a Professorial Fellow at Melbourne Law School, University of Melbourne. He has won several teaching awards, including a Universitas 21 Fellowship at the University of Melbourne, and the President’s Medal for Excellence in Graduate and Professional Teaching at Tulane University. Ian Malkin teaches Torts and Legal Method and Reasoning in the Melbourne Law School’s Juris Doctor (JD) program at the University of Melbourne. He has received the University of Melbourne’s Award for Outstanding Leadership of University Teaching, the Barbara Falk Award for Teaching Excellence and a national Carrick Australian Award – ‘Outstanding Contributions to Student learning’. Ian is one of the Directors of the JD program and was appointed the Law School’s first Director of the Office for Teaching and Learning in Law. He now chairs the University of Melbourne’s Teaching and Learning Quality Assurance Committee. Aside from his Torts scholarship, Ian has written widely on legal education.

About the Cover Art Artist: Ande K Terare Language group: Bundjalung

Tribe/clan: Minjungbal Title: ‘Wollumbin (Mt Warning)’ Ande K Terare was born in 1970 on the North Coast of New South Wales. He gained knowledge of traditional culture from older siblings and other relatives in his family. His paintings depict the traditional ways of life: the land, the natural resources, ceremonies, stories and legends, and contemporary works which are largely influenced by his Aboriginal heritage. He currently shows his work at Art Yarramunua Gallery (www.artyarramunua.com.au). Photo: Paul Williamson

Preface In this, the eighth edition of our book, we continue our long-held practice of beginning the exposition of the law of negligence with the concept of standard of care, rather than with the concept of duty, even though the latter is ‘logically’ prior. We continue to believe that it is more desirable pedagogically to deal with the relatively straightforward question of what constitutes negligent conduct before grappling with what the High Court of Australia has done with the concept of duty of care. We have tried to ensure that this edition, like the last seven, has continued to keep pace with the changed nature of the law of torts throughout the country. While some propositions of law are still true in all Australian jurisdictions, many are now true only in some Australian jurisdictions, mainly as a result of legislative change or judicial interpretation of the particular jurisdiction’s statutory provision. We have done our best to describe the law in all eight Australian jurisdictions, without privileging any particular state or territory, bearing in mind the many ways in which the Australian law of torts fundamentally changed in 2002–03, when the states and territories began to pass their civil liability legislation. Until that time, the Australian law of torts was largely uniform and was still largely based on common law principles. Neither of those propositions has been true for more than a decade now. As a result, this new edition is much longer than it was in the editions before the legislative changes of 2002–03. Australian torts teachers continue to face some difficult questions about how to teach their subject. Torts has traditionally been taught in the first year of law studies (or at least an early year) because it was an excellent vehicle for introducing students to common law concepts and methods. Torts teachers can no longer focus simply on common

law concepts because to do so risks grave inaccuracy, given the extent to which the states and territories have modified the common law by legislation. However, if we teach the present state of the law in detail (and there is now a great deal of legislative detail), students may well lose their grasp of the underlying concepts and end up seeing only trees and no wood. We hope this book has found a middle ground, merging accuracy with readability in its attempt to provide countrywide coverage. Where there has been legislative change, we have tried to show how it grew out of or responded to the common law position that preceded it. We also hope that we have shown clearly where there is uniformity and where there is difference. Readers may wish to ‘cherry-pick’ only those passages that are relevant to the particular jurisdiction in which they are interested. On the other hand, we anticipate that many students will continue to be interested in the law in other Australian jurisdictions, even when it differs from their own. As part of the Focus series, this book is designed with the following overall aim in mind: to explain and explore the concepts of the law of torts in as ‘reader- friendly’ a manner as possible and to illustrate the process of arguing for solutions to factual problems using the materials of the law of torts. To help guide readers, each chapter includes a list of objectives, key cases on the topic or topics covered in the chapter, and key legislative developments, where relevant. Tables are used at several points, to help summarise jurisdictional differences that have resulted from legislative interventions. Chapters include ‘Further reading’ lists, with references to texts, casebooks and journal articles as well as ‘Further discussion’ questions, which focus on interesting themes and emerging issues. We also have provided a problem in every chapter (except for Chapter 1), which describes a hypothetical fact situation and then asks readers to advise the parties on both sides of a dispute. (These are the remaining vestiges of the weekly tutorial problems that were part of the first edition from 1992, which was the first in the now-defunct Butterworths Tutorial Series.) With two exceptions, the sample

responses are described as ‘Discussion: arguments for’ the respective parties, to highlight the fact that the reader’s aim should be to produce plausible arguments based on the materials in the chapter, and not to seek ‘perfect answers’, in the sense of a supposedly ‘correct’ legal analysis of the factual situation. In Chapter 2 (‘Overview of Negligence’) and Chapter 21 (‘Revision’), we provide consolidated responses, because those chapters serve different objectives. All of the problems are set in jurisdictionally generic locales or communities such as Daisy Bay and Serenity Springs. Therefore, the discussion takes the reader on a journey through Australia’s different jurisdictions, to see how each one would respond to particular legal issues, having regard to specific legislative regimes as well as the relevant common law principles. The discussion explicitly compares how some of the most noteworthy statutory changes affect the plaintiff’s claim. We also have included an additional problem in each chapter, without responses, to encourage further discussion of how to apply the material explored in the chapter. In Chapter 8 (‘Economic Loss’) we include two unanswered problems, which address two different types of purely economic loss, and in Chapter 21 (‘Revision’) we provide two unanswered problems, to give readers an opportunity to test their comprehensive understanding. Several significant and interesting decisions have been handed down since the last edition was published. These include: Allen v Chadwick; Anwar v Mondello Farms Pty Ltd; Badenach v Calvert; Deal v Kodakkathanath; Hunter and New England Local Health District v McKenna; Jausnik v Nominal Defendant (No 5); King v Philcox; Marsh v Baxter; Powney v Kerang and District Health; Prince Alfred College Inc v ADC; Robinson Helicopter Company Inc v McDermott; Waller v James; T & X Co Pty Ltd v Chivas. All of these cases have been incorporated in one way or another into this edition. Martin Davies rewrote and updated Chapters 5 to 9 and 12 to 20. Ian Malkin rewrote and updated Chapters 1 to 4, 10, 11 and 21, and took responsibility for the problems and discussion. The authors would like

to thank Mary-Jane Oliver for her outstanding, indeed exceptional, editorial work and attention to detail, for which we are very grateful. Thanks to Jocelyn Holmes for her great leadership and understanding; and thanks to the rest of the team at LexisNexis Butterworths, for helping steer the text towards completion. We would like to thank Matthew Caldow, Thomas Diaz, Irene Han and Xavier Nicolo for their stellar work as research assistants on this edition. They demonstrated consummate professionalism and first-rate skills throughout. We would not have been able to meet the demands of the publication process (which has been relatively drama-free) without their splendid, expert assistance. Continued thanks to those assistants who helped in various ways with previous editions, where some aspects of their contributions remain: Shueh Hann Lim for writing a broadband-related problem (dragging Ian, back in the day, kicking and screaming, into the cyberspace era); Liam McGilchrist, for suggesting that Bollywood be brought to torts and naming ‘Aspirationville’; Natalie Burgess, Julian Chant, Jason Forte, Katherine France, Kanana Fujimori and Jeremy Masters, for their research assistance dating back to 2002 and their help with setting up charts and providing ideas for a few ‘additional’ problems. Ian would also like to thank colleagues and students at Melbourne Law School for their insights, friendship and good humour. In particular, he would like to thank the Law School’s remarkable Deputy Dean, Professor Matthew Harding, for his support. He also would like to thank his partner, artist Ande K Terare, for his support, good humour and engagement with legal doctrine. Ande also painted the wonderful painting that appears on the cover of this edition. Thanks to Paul Williamson for expertly photographing the painting. Ian also can’t help but thank Cino, his and Ande’s spritely, adorable Pugalier, who, during the last year, has brought endless joy to every day (and surprisingly does not feature in one of the problems). Martin would like to thank Ian for shouldering so much of the responsibility for getting the book ready for publication. Ian says, ‘that’s not true at all; No worries, Mate’.

Both authors thank Mr Jason Bosland, for his assistance and advice. Finally, thanks to Professor Harold Luntz, not only for a fascinating and lively conversation about taxation and superannuation issues in the context of damages awards, but also, most importantly, for his long and inspirational career as an exemplary torts scholar. Lastly, and probably superfluously (who could possibly have read this far in a Preface other than the two authors?), Martin would like to reinstate his former practice of welcoming daughters to his family. The number of editions of this book exceeds the number of Martin’s daughters, but only narrowly. He would like to welcome Beatrice, born in 2017, and to express his continuing paternal love for his other daughters Lydia, Gloria, Julia and Eleanor. (Yes, he now has five daughters.) As the great Australian boxer Jeff Fenech said, upon his retirement from the ring: ‘I love youse all.’ It goes without saying, but should definitely still be said, that Martin is deeply, irredeemably, indebted to his wife Erinn. Anyone who thinks that a book like this is possible without endless support and tolerance at home is much mistaken. Any law book must have an arbitrary cut-off date beyond which no developments can be considered. In the case of this edition, the cut-off date for the manuscript submitted to the publisher was July 2017. Martin Davies New Orleans Ian Malkin Melbourne October 2017

Acknowledgments The authors and publishers are grateful to the holders of copyright in material from which extracts appear in this work, particularly to the following: L Bender, ‘A Lawyer’s Primer on Feminist Theory and Tort’ (1988) 38 Journal of Legal Education 3 (extract). P Cane, ‘Reforming Tort Law in Australia: A Personal Perspective’ (2003) 27 Melbourne University Law Review 649 (extract). R Davis, ‘The Tort Reform Crisis’ (2002) 25 University of New South Wales Law Journal 865 (extract). R Graycar, ‘Public Liability: A Plea for Facts’ (2002) 25 University of New South Wales Law Journal 810 (extract). H Luntz, ‘Reform of the Law of Negligence: Wrong Questions — Wrong Answers’ (2002) 25 University of New South Wales Law Journal 836 (extract). Hon JJ Spigelman AC, ‘Negligence: The Last Outpost of the Welfare State’ (2002) 76 The Australian Law Journal 432 at 451. This extract has been republished with permission from Thomson Reuters. It was first published in The Australian Law Journal. For more information or to purchase this article or subscribe to The Australian Law Journal, please visit . Should you wish to reproduce this article, either in part or in its entirety, in any medium, please ensure you seek permission from the Thomson Reuters Permissions Officer. Please email any enquiries to [email protected]. The Incorporated Council of Law Reporting for England and Wales, Megarry House, 119 Chancery Lane, London WC2A 1PP, England

. The Law Reports (extracts from cases) are reproduced with permission. The state of Western Australia, Civil Liability Act 2002 (extracts). Western Australian statutory materials are reproduced with permission of the copyright owner, the state of Western Australia, but such materials do not purport to be the official or authorised versions. The Treasury, Reform of Liability Insurance Law in Australia, Commonwealth of Australia, 2004, reproduced with permission (extract). While every care has been taken to establish and acknowledge copyright, the publishers tender their apologies for any accidental infringement. They would be pleased to come to a suitable arrangement.

Table of Cases References are to paragraphs 532 Madison Ave Gourmet Foods v Finlandia Center Inc, 727 NYS 2d 49; 750 NE 2d 1097 (CANY, 2001) …. 8.50

A ABN AMRO Bank NV v Bathurst Regional Council (2014) 224 FCR 1 …. 8.28, 8.29, 8.52–8.55, 8.60, 16.17 Aboriginal Housing Co Ltd v Munro [2015] NSWSC 1155 …. 19.19, 19.55 Abraham Bht Abraham v St Mark’s Orthodox Coptic College [2006] NSWSC 1107 …. 6.7 Ackland v Stewart [2014] ACTSC 18 …. 11.31 ACN 087 528 774 Pty Ltd (formerly Connex Trains Melbourne Pty Ltd) v Chetcuti (2008) 21 VR 559 …. 16.15, 16.17, 16.18, 16.20, 16.39, 16.40 Adams v Kennedy (2000) 49 NSWLR 78 …. 16.24 Adams by her next friend O’Grady v State of New South Wales [2008] NSWSC 1257 …. 4.50 Adamson v Motor Vehicle Insurance Trust (1957) 58 WALR 56 …. 3.8, 3.81 Adeels Palace Pty Ltd v Moubarak (2009) 239 CLR 420; 260 ALR 628 …. 2.7, 3.28, 3.40, 4.5, 4.8, 4.9, 4.17, 4.21, 4.22, 4.26, 4.48, 4.63, 4.64, 13.39, 13.40 AFA Airconditioning Pty Ltd v Mendrecki (2008) 101 SASR 381 …. 12.31

Agar v Hyde (2000) 201 CLR 552; 173 ALR 665 …. 3.63, 8.35 Air Manymak v Jeffs [2006] NTCA 12 …. 12.38, 12.41 Al Mousawy v Howitt-Stevens Construction Pty Ltd [2010] NSWSC 122 …. 4.9, 4.63, 4.64 Alameddine v Glenworth Valley Horse Riding Pty Ltd [2015] NSWCA 219; (2015) 324 ALR 355; (2015) Aust Torts Reports ¶82-234 …. 11.31, 11.37, 11.50, 11.51 Alcoa of Australia Ltd v Apache Energy Ltd [2012] WASC 209 …. 13.4, 13.12, 13.17, 13.40 Alcoa Portland Aluminium Pty Ltd v Victorian Workcover Authority (2007) 18 VR 146 …. 12.22 Alexander v Heise [2001] NSWSC 69 …. 6.13, 6.26, 12.103 Allen v Chadwick (2015) 256 CLR 148 …. 10.44, 11.20 Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 221 CLR 568; 215 ALR 385 …. 13.30 Allianz Australia Insurance Ltd v Roads and Traffic Authority (NSW) (2010) 57 MVR 80; [2010] NSWCA 328 …. 7.24, 7.42 Amaca Pty Ltd v Booth (2011) 246 CLR 36; 283 ALR 461 …. 4.14, 4.15, 4.16, 4.21 Amaca Pty Ltd v Ellis (2010) 240 CLR 111; 263 ALR 576 …. 4.15, 4.16, 4.22 Amaca Pty Ltd v Hannell (2007) 34 WAR 109 …. 4.31, 12.82 Amaca Pty Ltd v King [2011] VSCA 447 …. 12.82 Amaca Pty Ltd v Moss [2007] WASCA 162 …. 4.31 Amaca Pty Ltd v New South Wales (2003) 199 ALR 596 …. 7.15, 7.42, 7.43 Amaca Pty Ltd v New South Wales (2004) 132 LGERA 309 …. 7.7, 7.10, 7.15, 7.21, 7.26 Amaca Pty Ltd v Tullipan [2014] NSWCA 269 …. 4.16 Ambulance Service of New South Wales v Worley [2006] NSWCA 102 …. 3.18

American Cyanamid Co v Ethicon Ltd [1975] AC 396 …. 15.51 American Online Inc v LCGM Inc, 46 F Supp 2d 444 (ED Va, 1998) …. 18.7 American Petroleum and Transport Inc v City of New York, 737 F 3d 185 (2d Cir 2013) …. 8.50 Anchor Products v Hedges (1966) 115 CLR 493 …. 4.32 Anderson v Mount Isa Basketball Association Ltd (1997) Aust Torts Reports 81-451 …. 3.32 Anderson Formrite Pty Ltd v Baulderstone Pty Ltd (No 7) [2010] FCA 921 …. 18.25, 18.26, 18.34, 18.38, 19.29 Anderson Group Pty Ltd v Tynan Motors Pty Ltd (2006) 65 NSWLR 400 …. 18.19 Andreae v Selfridge & Co Ltd [1938] Ch 1; [1937] 3 All ER 255 …. 15.8, 15.19 Angel v Hawkesbury City Council (2008) Aust Torts Reports 81-955; [2008] NSWCA 130 …. 11.26, 11.27 Anikin v Sierra (2004) 211 ALR 621 …. 3.56, 10.32, 10.33 Animal Liberation (Vic) Inc v Gasser [1991] 1 VR 51 …. 15.16, 15.30, 15.65 Anns v Merton London Borough Council [1978] AC 728 …. 7.32 Anthanasopoulos v Moseley (2001) 52 NSWLR 262 …. 12.101 Anwar v Mondello Farms Pty Ltd (2015) 123 SASR 321; 253 IR 70; (2015) Aust Torts Reports ¶82-235; [2015] SASCFC 109 …. 4.60, 9.12 Apache Energy Ltd v Alcoa of Australia Ltd (No 2) [2013] 45 WAR 379; 307 ALR 376 …. 5.7, 8.40, 8.58, 8.59 Armellin v Ljubic [2009] ACTCA 22 …. 16.32 Armstrong v Hastings Valley Motorcycle Club Ltd [2005] NSWCA 207 …. 13.31 Arthur Robinson (Grafton) Pty Ltd v Carter (1968) 122 CLR 649; [1968] ALR 257 …. 12.13, 12.33, 12.36

AS v Minister for Immigration and Border Protection (2016) 312 FLR 67; [2016] VSCA 206 …. 13.12, 13.39, 13.40 Ascic v Westel Co-operative Ltd (1992) Aust Torts Reports 81-159 …. 3.15 Ashby v Tolhurst [1937] 2 KB 242 …. 18.29, 18.32 Ashrafi Persian Trading Co Pty Ltd v Ashrafinia (2002) Aust Torts Reports 81-636 …. 6.22 Asim v Penrose [2010] NSWCA 366 …. 10.32, 10.49 Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 …. 7.23, 7.24, 7.29 Astley v Austrust Ltd (1999) 197 CLR 1; 161 ALR 155 …. 10.9, 13.32 Atlas Tiles Ltd v Briers (1978) 144 CLR 202; 21 ALR 129 …. 12.39, 12.40, 12.41 Attorney-General v Blake [2001] 1 AC 268 …. 19.37 Attorney-General v Carter [2003] 2 NZLR 160 (CA) …. 8.48 Attorney-General v PYA Quarries Ltd [1957] 2 QB 169 …. 15.58, 15.59 Attwells v Jackson Lalic Lawyers Pty Ltd (2016) 331 ALR 1; 90 ALJR 572; [2016] HCA 16 …. 5.33 Australia and New Zealand Banking Group Ltd v Haq [2016] NSWCA 93 …. 10.32 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199; 185 ALR 1 …. 15.13, 15.64, 15.65 Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57; 229 ALR 457 …. 15.51 Australian Coarse Grains Pool Pty Ltd v Barley Marketing Board (1982) 46 ALR 398; 57 ALJR 425 …. 15.51 Australian Executor Trustees Ltd v Propell National Valuers (WA) Pty Ltd [2011] FCA 522 …. 8.21, 8.29, 8.52–8.54 Australian Guarantee Corp Ltd v Commissioners of the State Bank of Victoria [1989] VR 617 …. 18.22, 19.16 Australian Iron and Steel Pty Ltd v Ryan (1957) 97 CLR 89 …. 13.17

Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479; 69 ALR 615 …. 3.65 Australian Securities and Investments Commission v Rich (2005) 220 ALR 324 …. 18.7, 18.38 Australian Staging and Rigging: Events Pty Ltd (in liq) v Elite Systems Australia Pty Ltd [2016] SASC 204 …. 18.22 Avram v Gusakoski (2006) Aust Torts Reports 81- 836; 31 WAR 400; [2006] WASCA 16 …. 10.37, 10.43, 11.20 Axiak v Ingram (2012) 82 NSWLR 36; [2012] NSWCA 311 …. 10.29, 10.30, 10.32

B Backwell v AAA [1997] 1 VR 182 …. 12.84 Badenach v Calvert (2016) 257 CLR 440; 331 ALR 48; 90 ALJR 610; [2016] HCA 18 …. 4.25, 4.26, 4.64, 5.25 Bader v Jelic [2011] NSWCA 255 …. 3.60, 3.62 Baggett v Hewlett-Packard Co, 582 F Supp 2d 1261 (CD Cal, 2007) …. 18.7 Baker v Bolton (1808) 1 Camp 493; 170 ER 1033 …. 8.39 Baker v Quantum Clothing Group Ltd [2011] WLR 1003 …. 13.29 Balven v Thurston [2013] NSWSC 210 …. 9.19, 16.18, 16.39, 16.40 Bamford v Turnley (1862) 3 B & S 66; 122 ER 27 …. 15.4, 15.64 Bankstown City Council v Alamdo Holdings Pty Ltd (2005) 223 CLR 660; 221 ALR 1 …. 15.48, 15.55, 15.56 Bankstown City Council v Zraika (2016) 74 MVR 505 …. 7.27, 7.42, 7.43 Barbagallo v J & F Catelan Pty Ltd [1986] 1 Qd R 245 …. 15.52 Barclay v Penberthy (2012) 246 CLR 258; 291 ALR 608 …. 5.25, 5.27, 8.29, 8.35, 8.39, 8.40, 8.53, 8.54, 8.58, 8.59 Barker v Corus (UK) Ltd [2006] 2 AC 572; [2006] 3 All ER 785 …. 4.20 Barker v R (1983) 153 CLR 338; 47 ALR 1 …. 17.21, 19.19, 19.56

Barnett v Chelsea and Kensington Hospital Management Committee [1969] 1 QB 428 …. 4.5, 4.10 Barrow v Bolt [2015] VSCA 107 …. 20.31 Bartolone v Jeckovich, 481 NYS 2d 545 (App Div, 1984) …. 9.13 Barton v Armstrong [1969] 2 NSWR 451 …. 16.18, 16.40 Barton v Armstrong [1976] AC 104 …. 16.18, 16.40 Basha v Vocational Capacity Centre Pty Ltd [2009] NSWCA 409 …. 3.43 Bathurst Regional Council v Thompson (2012) 191 LGERA 182 …. 7.20, 7.42 Battiato v Lagana [1992] 2 Qd R 234 …. 16.2, 16.6, 19.23, 19.55 Baulkham Hills Shire Council v AV Walsh Pty Ltd [1968] 3 NSWR 138; (1968) 15 LGRA 338 …. 15.53 Bazley v Curry [1999] 2 SCR 534 …. 14.12 Belbin v Lower Murray Urban and Rural Water Corp [2012] VSC 535 …. 20.28 Bell v Western Australia (2004) 28 WAR 555 …. 14.4 Benham v Gambling [1941] AC 157 …. 12.81 Benjamin v Storr (1874) LR 9 CP 400 …. 15.59, 15.60, 15.64, 15.65 Bennett v Minister for Community Welfare (1992) 176 CLR 408; 107 ALR 617 …. 4.1, 4.5, 4.19, 4.31, 4.44, 4.45, 4.64 Bennett v Tugwell [1971] 2 QB 267 …. 11.36, 11.50, 11.51 Bennetts v Honroth [1959] SASR 170 …. 15.53 Benning v Wong (1969) 122 CLR 249 …. 15.23, 15.64, 15.65 Berezovksy v Michaels [2000] 1 WLR 1004 …. 20.2 Bernstein of Leigh (Baron) v Skyviews & General Ltd [1978] QB 479 …. 17.7, 17.10 Berrigan Shire Council v Ballerini (2005) …. 5.15 Betts v Whittingslowe (1945) 71 CLR 637 …. 13.5 BHP Billiton Ltd v Hamilton (2013) 117 SASR 329 …. 12.82

Biggs v George [2016] NSWCA 113 …. 3.26, 3.80 Bilambil-Terranora Pty Ltd v Tweed Shire Council [1980] 1 NSWLR 465 …. 19.37 Bird v Holbrook (1828) 4 Bong 628; 130 ER 911 …. 19.10 Bird v Jones (1845) 7 QB 742; 115 ER 668 …. 16.21, 16.39, 16.40 Bitupave Ltd (t/as Boral Asphalt) v Pillinger (2015) 72 MVR 460; [2015] NSWCA 298 …. 3.36, 3.77, 4.17 Black Diamond Group Pty Ltd v Manor of Maluka Pty Ltd [2015] 1 Qd R 180 …. 19.38 Blacker v Waters (1928) 28 SR (NSW) 406 …. 16.4 Blades v Higgs (1861) 10 CB (NS) 713; 142 ER 634 …. 19.11, 19.12 Blake v Barnard (1840) 9 Car & P 626; 173 ER 985 …. 16.19 Blake v JR Perry Nominees Pty Ltd (2010) 195 IR 336; [2010] VSC 272 …. 14.20, 14.47, 14.48 Blakemore v Moore [2015] NSWDC 9 …. 11.27, 11.50 Blundell v Leighton [2013] ACTCA 1 …. 4.9 Blyth v Birmingham Waterworks Co (1856) 11 Ex 781; 156 ER 1047 …. 2.4, 3.3 Boateng v Dharamdas (2016) 77 MVR 151; [2016] NSWCA 183 …. 10.31, 10.49 Bocardo SA v Star Energy UK Onshore Ltd [2011] 1 AC 380 …. 17.10 Body Corporate 366611 v Wu [2013] 3 NZLR 522 …. 15.16 Bolam v Friern Hospital Management Committee [1957] 1 WLR 582 …. 2.5, 3.16, 3.17, 3.20, 3.22, 3.25, 3.79, 3.80 Bolitho v City and Hackney Health Authority [1998] AC 232 …. 3.20 Bonnici v Ku-ring-gai Municipal Council (2002) Aust Torts Reports 81631 …. 15.21, 15.64, 15.65 Bonnington Castings v Wardlaw [1956] AC 613 …. 4.15, 4.16, 4.17, 4.18, 4.21, 4.23 Booksan Pty Ltd v Wehbe (2006) Aust Torts Reports 81-830; [2006] NSWCA 3 …. 13.1, 13.3, 13.33

Boral Bricks Pty Ltd v Cosmidis (No 2) (2014) 86 NSWLR 393 …. 10.14, 10.31, 10.49, 10.50 Boral Resources (Queensland) Pty Ltd v Pyke [1992] 2 Qd R 25; 93 ALR 89 …. 14.25 Borland v Makauskas [2000] QCA 521 …. 3.56 Born Brands Pty Ltd v Nine Network Australia Pty Ltd (2014) 88 NSWLR 421…. 20.12 Bose Corp v Consumers Union of US Inc, 466 US 485 at 511 (1984) …. 20.2 Boughey v R (1986) 161 CLR 10; 65 ALR 609 …. 16.9, 16.39, 16.40 Bowditch (by his litigation guardian Bowditch) v McEwan [2003] 2 Qd R 615 …. 6.7 Boyded Industries Pty Ltd (t/as Boyded Parramatta) v Canuto [2004] NSWCA 256 …. 3.66 Bradburn v Great Western Railway Co (1874) LR 10 Exch 1 …. 12.89, 12.91, 12.95 Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 …. 4.13, 4.17 Brakoulias v Karunaharan [2012] VSC 272 …. 3.25, 3.79, 3.80 Brambles Security Services Ltd v Bi-Lo Pty Ltd (1992) Aust Torts Reports 81-161 …. 6.15 Branson v South Australian Police Force (1993) 60 SASR 325 …. 19.19, 19.56 Break Fast Investments Pty Ltd v PCH Melbourne Pty Ltd (2007) 20 VR 311 …. 17.8 Brewer v AAL Aviation Ltd [2016] FCA 93 …. 8.16, 8.52 Brkovic v Clough (JO) & Son Pty Ltd (1983) 49 ALR 256 …. 3.43 Broadway Pty Ltd v Lewis [2012] WASC 373 …. 19.41 Broderick Motors Pty Ltd v Rothe (1986) Aust Torts Reports 80-059 …. 15.16 Brodie v Singleton Shire Council (2001) 206 CLR 512; 180 ALR 145 …. 5.23, 6.7, 7.38, 7.39, 7.40, 15.21, 15.62

Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 (2014) 254 CLR 185; 313 ALR 408 …. 5.25, 8.37, 8.44, 8.48, 8.55, 8.58, 8.59 Bropho v Western Australia [2007] FCA 519 …. 17.16 Bropho v Western Australia (2008) 169 FCR 59; 249 ALR 121 …. 17.16 Brown v Hewson [2015] NSWCA 393 …. 4.14 Bryan v Maloney (1995) 182 CLR 609; 128 ALR 163 …. 8.41, 8.42, 8.43, 8.44, 8.49, 8.58, 8.59 BT v Oei [1999] NSWSC 1082 …. 5.33, 6.13, 6.25, 6.26 Buckle v Bayswater Road Board (1936) 57 CLR 259 …. 7.38 Bugge v Brown (1919) 26 CLR 110 …. 2.11, 14.17, 14.18, 14.20, 14.47 Bujdoso v New South Wales (2004) 151 A Crim R 235 …. 3.49, 3.50 Bujdoso v New South Wales (2007) 69 NSWLR 302; (2007) Aust Torts Reports ¶81-876 …. 6.9 Bulli Coal Mining Co v Osborne [1899] AC 351 …. 17.10 Bunnings Group Ltd v CHEP Australia Ltd (2011) 82 NSWLR 420 …. 18.11, 18.28, 18.29, 18.30, 18.38, 18.39, 19.36, 19.38 Bunyan v Jordan (1937) 57 CLR 1 …. 9.16 Burford v Allen (1993) Aust Torts Reports 81-226 …. 12.14 Burke v Batchelor (1980) 24 SASR 33 …. 12.78 Burke v Forbes Shire Council (1987) Aust Torts Reports 80-122 …. 8.25, 8.54 Burnett v Randwick City Council [2006] NSWCA 196 …. 18.12 Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520; 120 ALR 42 …. 8.35, 14.29, 14.47, 14.48, 15.20, 15.21, 15.64, 15.65 Burns v Pearce (2010) 57 MVR 136; [2010] WASCA 214 …. 4.43 Bus v Sydney County Council (1989) 167 CLR 78; 85 ALR 577 …. 3.32 Butler v Egg and Egg Pulp Marketing Board (1966) 114 CLR 185 …. 19.33 Butterfield v Forrester (1809) 11 East 60; 103 ER 926 …. 10.1, 10.4

Byrne v Australian Airlines Ltd (1995) 185 CLR 410; 131 ALR 422 …. 13.11, 13.17, 13.39, 13.40 Bywell Castle, The (1879) LR 4 PD 219 …. 10.20

C C v Holland [2012] 3 NZLR 672 …. 15.13, 15.65 Cakir v Arnott’s Biscuits Pty Ltd [2007] VSCA 104 …. 12.42 CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board (2009) 239 CLR 390; 260 ALR 606 …. 2.3, 5.26, 5.31, 5.32, 6.14, 6.15, 6.25, 6.26 Caltex Oil (Australia) Pty Ltd v The Dredge ‘Willemstad’ (1976) 136 CLR 529; 11 ALR 227 …. 5.18, 5.24, 8.3, 8.29, 8.32, 8.33, 8.34, 8.35, 8.36, 8.37, 8.40, 8.42, 8.45, 8.46, 8.47, 8.49, 8.58, 8.59 Caltex Refineries (Qld) Pty Ltd v Stavar (2009) 75 NSWLR 649 …. 2.8, 5.27, 5.28, 5.31, 5.32 Cambridge Water Co v Eastern Counties Leather plc [1994] 2 AC 264 …. 15.18, 15.64, 15.65 Cameron v Sullivan [1962] QWN 32 …. 12.49 Campbell v Hay [2014] NSWCA 129 …. 11.31 Canadian National Railway Co v Norsk Pacific Steamship Co [1992] 1 SCR 1021 …. 8.49 Candler v Crane Christmas & Co [1951] 2 KB 164 …. 8.6 Candlewood Navigation Corp Ltd v Mitsui OSK Lines Ltd: The Mineral Transporter [1986] AC 1 …. 8.46 Caparo Industries plc v Dickman [1990] 2 AC 605 …. 5.22, 5.23, 5.27, 5.31–5.33, 8.34 Carangelo v New South Wales [2016] NSWCA 126 …. 4.21, 4.64 Carey v Lake Macquarie City Council (2007) Aust Torts Reports 81874; [2007] NSWCA 4 …. 10.11, 10.17, 11.2, 11.16, 11.25, 11.26, 11.27, 11.50, 11.51 Carey-Hazell v Getz Bros & Co (Aust) Pty Ltd (2004) ATPR 42-014;

[2004] FCA 853 …. 1.23 Carrier v Bonham [2002] 1 Qd R 474 …. 3.9 Carroll v Lewitzke (1991) 56 SASR 18 …. 10.23 Carter v Walker (2010) 32 VR 1; [2010] VSCA 340 …. 16.11, 16.32, 16.39 Cartwright v McLaine & Long Pty Ltd (1979) 143 CLR 549; 24 ALR 97 …. 15.43 Casley v Commonwealth (1980) 30 ALR 38 …. 16.24, 19.21, 19.55 Casley-Smith v FS Evans & Sons Pty Ltd (No 5) (1988) 67 LGRA 108 …. 15.33 Castle v St Augustine’s Links Ltd (1922) 38 TLR 615 …. 15.61, 15.64 Cattanach v Melchior (2003) 215 CLR 1; 199 ALR 131 …. 4.39, 4.56, 12.2, 12.3, 12.4, 12.63 Cawrse v Cocks (1974) 10 SASR 10 …. 12.47 Central Darling Shire Council v Greeney [2015] NSWCA 51 …. 4.26 Century Insurance Co Ltd v Northern Ireland Road Transport Board [1942] AC 509 …. 14.16 CES v Superclinics (Aust) Pty Ltd (1995) 38 NSWLR 47 …. 4.39 CG Maloney Pty Ltd v Hutton-Potts [2006] NSWCA 136 …. 2.19, 11.26, 11.27, 11.50, 11.51 Chairman, National Crime Authority v Flack (1998) 86 FCR 16; 156 ALR 501 …. 18.13, 18.25, 18.26 Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 …. 20.6, 20.37 Chan v Sellwood [2009] NSWSC 1335 …. 15.13, 15.64, 15.65 Chandley v Roberts [2005] VSCA 273 …. 10.19 Channel Seven Adelaide Pty Ltd v Manock (2007) 232 CLR 245; 241 ALR 468 …. 20.5, 20.25, 20.27, 20.37, 20.38 Chaplin v Dunstan Ltd [1938] SASR 245 …. 14.16 Chapman v Hearse (1961) 106 CLR 112; [1962] ALR 379 …. 4.43, 4.44, 4.56, 4.63, 4.64, 5.9, 5.11, 5.17, 5.31, 5.32, 14.38

Chappel v Hart (1998) 195 CLR 232; 156 ALR 517 …. 4.22, 4.26, 4.27, 4.29, 4.36, 4.63, 4.64 Chappell v Mirror Newspapers Ltd (1984) Aust Torts Reports ¶80-691 …. 20.31 Chep Australia Ltd v Bunnings Group Ltd [2010] NSWSC 301 …. 18.16 Chetwynd v Armidale Dumaresq Council [2010] NSWSC 690 …. 20.28 Chew v Amanatidis [2009] SASC 334 …. 8.12, 8.20, 8.52, 8.54 Chiarabaglio v Westpac Banking Corp (1989) ATPR 40-971 …. 8.16 Chiarabaglio v Westpac Banking Corp (1991) ASC 56-040 …. 8.16 Chicco v Woodville Corporation (1990) Aust Torts Reports 81-028 …. 3.15 Chin v Venning (1975) 49 ALJR 378 …. 16.34 Chomentowski v Red Garter Restaurant Ltd (1970) 92 WN (NSW) 1070 …. 6.23 Chordas v Bryant (Wellington) Pty Ltd (1988) 20 FCR 91; 91 ALR 149 …. 13.12 Christie v Davey [1893] 1 Ch 316 …. 15.11 Christopherson v Bare (1848) 11 QB 473; 116 ER 554 …. 16.13 Chugg v Pacific Dunlop Ltd (1990) 170 CLR 249 …. 13.30, 13.39 Cinnamond v British Airports Authority [1980] 2 All ER 368 …. 17.21 Citicorp Australia Ltd v BS Stillwell Ford Pty Ltd (1979) 21 SASR 142 …. 18.18, 18.27, 18.29 City Motors (1933) Pty Ltd v Southern Aerial Super Service Pty Ltd (1961) 106 CLR 477 …. 18.17, 18.25, 18.26, 19.34 City of Stirling v Tremeer (2006) 32 WAR 155 …. 4.31 Clark v Hall [2006] QSC 274 …. 12.69 Clarke v Delacey (1990) 12 MVR 32 …. 10.23 Clavel v Savage [2013] NSWSC 775 …. 9.4, 9.17 Clavel v Savage (No 2) [2014] NSWSC 463 …. 9.17

Clement v Backo [2007] 2 Qd R 99 …. 12.26 Clifford v Dove [2006] NSWSC 314 …. 15.26, 15.56, 15.64, 15.65 Club Italia (Geelong) Inc v Ritchie (2001) 3 VR 447 …. 4.48, 6.22, 6.25, 6.26 Coastal Conduit & Ditching Inc v Noram Energy Corp, 29 SW 3d 282 (Tex App, 2000) …. 8.50 Coca-Cola Amatil (NSW) Pty Ltd v Pareezer (2006) Aust Torts Reports 81-834; [2006] NSWCA 45 …. 6.11 Coca-Cola Amatil (SA) Ltd v Petineris (1996) 66 SASR 577 …. 10.18 Coco v R (1994) 179 CLR 427; 120 ALR 415 …. 17.20, 19.21, 19.55, 19.56 Coffey v Queensland [2012] QSC 186 …. 16.6 Cohen v City of Perth (2000) 112 LGERA 234 …. 15.46 Cole v South Tweed Heads Rugby League Football Club Ltd (2004) 217 CLR 469; 207 ALR 52 …. 2.3, 5.12, 5.13, 5.15, 5.17, 5.31, 5.32, 6.25 Cole v Turner (1704) 6 Mod 149; 87 ER 907 …. 16.6, 16.40 Coles Supermarkets Australia Pty Ltd v Tormey [2009] NSWCA 135 …. 12.22 Collins v Clarence Valley Council (No 3) [2013] NSWSC 1682 …. 7.39 Collins v Clarence Valley Council [2015] NSWCA 263; (2015) 91 NSWLR 128 …. 11.27 Collins v Wilcock [1984] 1 WLR 1172 …. 16.8, 16.9, 16.12, 16.39, 16.40 Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41; [1932] ALR 73 …. 14.5, 14.13 Colour Quest Ltd v Total Downstream UK plc [2011] QB 86 (CA) …. 8.47 Comino v Lynch [1959] QWN 49 …. 14.16 Commercial Union Assurance Co of Australia Ltd v Pelosi (NSWCA,

Kirby P, Handley and Sheller JJA, 2 February 1996, unreported, BC9600077) …. 12.54 Commissioner for Railways v Halley (1978) 20 ALR 409 …. 10.18 Commissioner of Main Roads v Jones (2005) 215 ALR 418 …. 3.56, 4.28 Commissioner of Railways v Ruprecht (1979) 142 CLR 563; 25 ALR 481 [1979] HCA 37; 142 CLR 563 …. 10.8, 10.11, 10.16, 10.17 Commissioner of Taxation v Sydney Refractive Surgery Centre Pty Ltd (2008) 172 FCR 557; 253 ALR 59 …. 12.41 Commonwealth v Graves (1996) 41 NSWLR 111 …. 16.24, 19.21, 19.56 Commonwealth v Griffiths (2007) 70 NSWLR 268 …. 14.4 Commonwealth v Introvigne (1982) 150 CLR 258; 41 ALR 577 …. 14.29, 14.47 Commonwealth Bank of Australia v Kojic (2016) 341 ALR 572 …. 19.50 Commonwealth v McLean (1996) 41 NSWLR 389 …. 4.57 CompuServe Inc v Cyber Promotions Inc, 962 F Supp 1015 (SD Oh, 1997) …. 18.7 Consolidated Broken Hill Ltd v Edwards (2005) Aust Torts Reports 81815; [2005] NSWCA 380 …. 10.11, 10.14, 10.49, 11.17 Cook v Cook (1986) 162 CLR 376; 68 ALR 353 …. 3.12, 3.79, 3.81, 10.14, 11.17 Cope v Sharpe (No 2) [1912] 1 KB 496 …. 19.2, 19.3, 19.5 Corbett v Morgenstern, 934 F Supp 680 (ED Pa, 1996) …. 9.15 Corbett v Pallas (1995) Aust Torts Reports 81-329 …. 15.17 Cornes v The Ten Group Pty Ltd (2011) 114 SASR 1 …. 20.7, 20.10, 20.37, 20.38 Cosentino v Medich Properties Pty Ltd [2003] NSWSC 606 …. 15.16 Council of the City of Greater Taree v Wells [2010] NSWCA 147 …. 10.11, 11.27

Council on American-Islamic Relations Action Network Inc v Gaubatz, 793 F Supp 2d 311 (DDC 2011) …. 18.25 Cowell v Corrective Services Commission of New South Wales (1988) 13 NSWLR 714 …. 14.4, 16.24, 19.21, 19.55 Cowell v Rosehill Race Course Co Ltd (1937) 56 CLR 605 …. 17.18, 17.21, 17.23, 17.24, 19.55, 19.56 Cox v Colossal Cavern Co, 276 SW 540 (1925, Ky) …. 17.10 Cox v Fellows [2013] NSWCA 206 …. 3.71, 4.9 Cox v New South Wales (2007) Aust Torts Reports 81-888; [2007] NSWSC 471 …. 4.8, 4.17, 4.63, 4.64, 6.5 Cran v New South Wales (2004) 62 NSWLR 95 …. 6.10 Cressy v Johnson [2009] VSC 52 …. 18.4, 18.6, 18.38, 18.39 Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1; 167 ALR 1 …. 5.23, 7.13, 7.15, 7.21, 7.27, 7.33, 7.42, 7.43, 8.35 Crisp v Fairfax Media Ltd [2012] VSC 615 …. 20.28 Croucher v Cachia [2016] NSWCA 132 …. 16.4, 16.32, 16.36, 19.9, 19.55, 19.56 CSR Ltd v Amaca Pty Ltd [2016] VSCA 320 …. 4.15 CSR Ltd v Eddy (2005) 226 CLR 1; 222 ALR 1 …. 12.27, 12.28, 12.29 CSR Ltd v Young (1998) Aust Torts Reports 81- 468 …. 12.82 CSR Readymix (Australia) Pty Ltd v Payne [1998] 2 VR 505 …. 12.11 Cubillo v Commonwealth (2000) 103 FCR 1; 174 ALR 97 …. 13.22 Cubillo v Commonwealth (2001) 112 FCR 455; 183 ALR 249 …. 1.17, 1.19, 13.22 Cullen v Trappell (1980) 146 CLR 1; 29 ALR 1 …. 12.39, 12.40, 12.41, 12.42, 12.43, 12.44 Cunningham v Traynor [2016] WADC 306 …. 19.43 Curtis v Harden Shire Council (2012) 192 LGERA 154; [2012] NSWSC 757 …. 7.27 Curtis v Harden Shire Council (2014) 88 NSWLR 10 …. 7.25, 7.39, 7.42, 7.43

Cush v Dillon (2011) 243 CLR 298; 279 ALR 631 …. 20.22, 20.23 Cutler v Wandsworth Stadium Ltd [1949] AC 398 …. 13.13 Cvetkovic v Princes Holdings (t/as Tilt Amusement Centre) (1989) 51 SASR 365 …. 11.7 Czatyrko v Edith Cowan University (2005) 214 ALR 349 …. 10.19

D Dailly v Spot-On Investments Pty Ltd (t/as Spot- On Photos) (1995) Aust Torts Reports 81-363 …. 3.37, 3.77, 3.78 Dale v Fox [2012] TASSC 84 …. 16.32 Daniels v Thompson [1998] 3 NZLR 22 …. 19.49 Darby v Director of Public Prosecutions (2004) 61 NSWLR 558 …. 16.10, 16.14, 16.39 Darcy v New South Wales [2011] NSWCA 413 …. 16.23, 16.39, 16.40 Darling Island Stevedoring and Lighterage Co Ltd v Long (1957) 97 CLR 36 …. 13.17, 13.21, 13.22 Dartberg Pty Ltd v Wealthcare Financial Planning Pty Ltd (2007) 164 FCR 450; 244 ALR 552 …. 8.29, 8.54 Davidson v JS Gilbert Fabrications Pty Ltd [1986] 1 Qd R 1 …. 19.27 Davies v Bennison (1927) 22 Tas LR 52 …. 17.8 Davies v George Thomas Hotels Pty Ltd [2010] NSWDC 55 …. 10.46, 10.50 Davies v Mann (1842) 10 M & W 546; 152 ER 588 …. 10.2 Davies v Swan Motor Co (Swansea) Ltd [1949] 2 KB 291 …. 10.8 Davis v Swift (2014) 69 MVR 375; [2014] NSWCA 458 …. 10.30 Day v Bank of New South Wales (1978) 18 SASR 163 …. 19.16 Day v Ocean Beach Hotel Shellharbour Pty Ltd [2013] 85 NSWLR 335…. 14.14 De Jager v Payneham & Magill Lodges Hall Inc (1984) 36 SASR 498 …. 15.41, 15.42

De Reus v Gray (2003) 9 VR 432 …. 19.43 Deal v Kodakkathanath (2016) 258 CLR 281; 334 ALR 37 …. 13.24, 13.39, 13.40 Deatons Pty Ltd v Flew (1949) 79 CLR 370 …. 2.11, 14.18, 14.19, 14.20, 14.48 Deepcliffe Pty Ltd v Council of the City of Gold Coast (2001) 118 LGERA 117 …. 15.12 Del Ponte v Del Ponte (1987) 11 NSWLR 498 …. 12.75 Delaney v TP Smith Ltd [1946] KB 393 …. 17.14, 17.15, 17.23 Delaware Mansions Ltd v Westminster City Council [2002] 1 AC 321 …. 15.36 Department of Housing and Works v Smith (No 2) (2010) 265 ALR 490 …. 2.19, 3.35, 3.40, 3.66, 3.77 Derring Lane Pty Ltd v Fitzgibbon (2007) 16 VR 563 …. 8.24, 8.28, 8.52, 8.54 Derry v Peek (1889) 14 App Cas 337 …. 8.6 Di Napoli v New Beach Apartments Pty Ltd (2004) Aust Torts Reports 81-728; [2004] NSWSC 52 …. 17.10, 17.19 DirecTV Inc v Pahnke, 405 F Supp 2d 1182 (ED Cal 2005) …. 18.25 Direen v Coad [2005] TASSC 21 …. 12.49 Direen v Coad [2005] TASSC 122 …. 12.49 DiStiso v Town of Wolcott, 539 F Supp 2d 562 (D Conn, 2008) …. 9.15 DiStiso v Town of Wolcott, 352 Fed Appx 478 (2d Cir, 2009) …. 9.15 Dixon v Davies (1982) 17 NTR 31 …. 12.74 Doble Express Transport Pty Ltd (admin apptd) v John L Pierce Pty Ltd [2016] NSWCA 352 …. 10.26 Dobler v Halverson (2007) 70 NSWLR 151 …. 3.25, 3.79, 3.80, 4.35 Dodd v McGlashan [1967] ALR 433 …. 11.14 Doe v Australian Broadcasting Corporation [2007] VCC 281 …. 15.13, 15.65

Doe d Murray, Lord Bishop of Rochester v Bridges (1831) 1 B & Ad 847; 109 ER 1001 …. 13.8, 13.39, 13.40 Dollar Sweets Pty Ltd v Federated Confectioners Association of Australia [1986] VR 383 …. 15.16 Domachuk v Feiner [1996] NSWCA 157 …. 15.5, 15.21, 15.65 Don King Productions/Kingvision v Lovato, 911 F Supp 419 (ND Cal 1995) …. 18.25 Donoghue v Stevenson [1932] AC 562 …. 2.8, 4.53, 5.5, 5.6, 5.7, 5.8, 5.11, 5.19, 5.20, 5.32 Dorset Yacht Co Ltd v Home Office [1970] AC 1004 …. 6.18, 6.25 D’Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1; 214 ALR 92 …. 5.27, 5.33, 11.46 Doubleday v Kelly (by her next friend Kelly) [2005] NSWCA 151 …. 10.13, 10.50, 11.27 Dovuro Pty Ltd v Wilkins (2003) 215 CLR 317; 201 ALR 139 …. 3.73 Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575; 194 ALR 433 …. 20.8, 20.9, 20.37 Dowdell v Knispel Fruit Juices [2003] FCA 851 …. 13.17 Downes v Affinity Health Pty Ltd [2016] QCA …. 4.14 Downs v Williams (1971) 126 CLR 61 …. 13.5 Doyle v O’Doherty (1842) Car & M 418; 174 ER 570 …. 20.20 Drew v New South Wales [2015] NSWCA 159 …. 3.66, 3.78 Drexel London (a firm) v Gove (Blackman) (2009) 170 LGERA 54; [2009] WASCA 181 …. 13.18, 13.19, 13.39, 13.40 Drinkwater v Howarth [2006] NSWCA 222 …. 3.36, 3.77, 3.78 Drummoyne Municipal Council v Australian Broadcasting Corp (1990) 21 NSWLR 135 …. 20.5 Dryden v Orr (1928) 28 SR (NSW) 216 …. 19.27 Duffy v Google Inc (2015) 125 SASR 437 …. 20.10 Dulieu v White [1901] 2 KB 669 …. 9.2

Dumont v Miller (1873) 4 AJR 152 …. 17.4, 19.23, 19.55 Duncan v Bell [1967] Qd R 425 …. 11.14 Duquesne Light Co v Pennsylvania American Water Co, 850 A 2d 701 (Pa, Super, 2004) …. 8.50 Dwan v Farquar [1988] 1 Qd R 234 …. 3.16

E East Suffolk Catchment Board v Kent [1940] 1 KB 319 …. 7.3 East Suffolk Catchment Board v Kent [1941] AC 74 …. 7.3 Eaton v TriCare (Country) Pty Ltd [2016] QCA 139 …. 4.56, 4.63 eBay Inc v Bidder’s Edge Inc, 100 F Supp 2d 1058 (ND Cal, 2000) …. 18.7, 18.38 Edwards v Lee, 96 SW (2d) 1028 (1936, Ky) …. 17.10 Edwards v Sims, 24 SW (2d) 619 (1929, Ky) …. 17.10 Egan v State Transport Authority (1982) 31 SASR 481 …. 19.38 Elbourne v Gibbs [2006] NSWCA 127 …. 4.28, 4.35 Electric Power Transmission Pty Ltd v Orgaz (WASCFC, 3 November 1989, unreported, BC8900870) …. 10.18 Electro Optic Systems Pty Ltd v New South Wales (2014) 180 ACTR 1; [2014] ACTCA 45 …. 3.36, 3.77 Elite Protective Personnel Pty Ltd v Salmon [2007] NSWCA 322 …. 19.14, 19.15 Elwood v Pioneer Concrete (WA) Pty Ltd [2002] WASCA 32 …. 15.15 Endeavour Energy v Precision Helicopters Pty Ltd [2015] NSWCA 169 …. 4.35 English v Rogers (2005) Aust Torts Reports 81- 800; [2005] NSWCA 327 …. 6.11 Enjakovic (deceased), Estate of (2008) 100 SASR 486 …. 20.28 Environment Agency (formerly National Rivers Authority) v Empress Car Co (Abertillery) Ltd [1998] 1 All ER 421 …. 4.26

Erickson v Bagley [2015] VSCA 220 …. 3.36, 3.77, 3.78 Erwin v Iveco Trucks Australia Ltd (2010) 267 ALR 752; [2010] NSWCA 113 …. 3.14, 3.80 Esanda Finance Corp Ltd v Gibbons [1999] NSWSC 1094 …. 18.13 Esanda Finance Corp Ltd v Peat Marwick Hungerfords (Reg) (1997) 188 CLR 241; 142 ALR 750 …. 8.27, 8.28, 8.29, 8.36, 8.53, 8.55, 8.59 Esso Petroleum Co Ltd v Southport Corp [1956] AC 218 …. 19.4 Evans v Queanbeyan City Council [2011] NSWCA 230 …. 4.15, 4.16, 4.21 Everitt v Martin [1953] NZLR 298 …. 18.6, 18.38, 18.39

F F v R (1983) 33 SASR 189 …. 3.10 F (Mental patient: sterilisation), Re [1990] 2 AC 1 …. 16.8, 16.9, 16.40 Fabre v Lui [2015] NSWCA 157 …. 3.51 Facebook Internet Tracking Litigation, Re, 844 F Supp 2d 1374 (US Jud Pan Mult Lit, 2012) …. 18.7 Fairchild v Glenhaven Funeral Services Ltd [2003] 1 AC 32 …. 4.16, 4.17, 4.18, 4.19, 4.20, 4.21, 4.25, 4.34, 4.64 Fairfax Media Productions Pty Ltd v Kermode (2011) 81 NSWLR 157; 282 ALR 314 …. 20.17, 20.18, 20.26, 20.37 Fairfax Media Publications Pty Ltd v Zeccola (2015) 91 NSWLR 341 …. 20.17 Falkingham v Hoffmans (A Firm) (2014) 46 WAR 510; [2014] WASCA 140 …. 4.26 Fallas v Mourlas (2006) 65 NSWLR 418; [2006] NSWCA 32 …. 11.27, 11.31 Falvo v Australian Oztag Sports Association (2006) Aust Torts Reports 81-831; [2006] NSWCA 17 …. 11.31 Feiner v Domachuk (1994) 35 NSWLR 485 …. 15.5, 15.21, 15.64,

15.65 Felhaber v Rockhampton City Council [2011] QSC 023 …. 10.13 Fennell v Robson Excavations Pty Ltd [1977] 2 NSWLR 486 …. 15.33 Fennell v Supervision and Engineering Services Holdings Pty Ltd (1988) 47 SASR 6 …. 10.18 Ferguson v Eakin (NSWCA, Meagher, Powell and Cole JJA, 27 August 1997, unreported, BC9703869) …. 18.21 Fernando v Commonwealth (No 5) [2013] FCA 901 …. 19.24, 19.43, 19.49, 19.55, 19.56 Ffrench v Sestili [2007] 98 SASR 28; [2007] SASC 241 …. 14.20, 14.47, 14.48 Fidlar Technologies v LPS Real Estate Data Solutions Inc, unreported, 2013 WL 5973938 (CD Ill 2013) …. 18.7 Fitzgerald v Kellion Estates Pty Ltd (1977) 2 BPR 97, 095 …. 18.35 Fitzpatrick v Job (t/as Jobs Engineering) (2007) Aust Torts Reports 81891; [2007] WASCA 63 …. 4.5 Fitzpatrick v Walter E Cooper Pty Ltd (1935) 54 CLR 200 …. 4.32 Fitzsimmons v Coles Supermarkets Australia Pty Ltd [2013] NSWCA 273 …. 10.32, 11.27, 11.51 Fleming v Advertiser-News Weekend Publishing Co Pty Ltd [2016] SASC 26 …. 20.17 Flemington Properties Pty Ltd v Raine and Horne Commercial Pty Ltd (1998)148 ALR 271 …. 3.19 Flight Centre Ltd v Louw (2010) 78 NSWLR 656 …. 9.12, 9.23, 9.24 Flowfill Packaging Machines Pty Ltd v Fytore Pty Ltd (1993) Aust Torts Reports 81-244 …. 18.35, 19.36 Flynn v Flynn (2011) 77 SR (WA) 339 …. 18.20 Fontin v Katapodis (1962) 108 CLR 177 …. 19.7, 19.48, 19.51, 19.55, 19.56 Forde v Skinner (1803) 4 Car & P 239; 172 ER 687 …. 16.6 Forsberg v Maslin [1968] SASR 432 …. 12.50, 12.52, 12.103

Fowler v Lanning [1959] 1 QB 426 …. 16.29, 16.30, 16.31 Fox v Hack [1984] 1 Qd R 391 …. 3.15 Fox v Percy (2003) 214 CLR 118; 197 ALR 201 …. 3.56 Fraser v Burswood Resort (Management) Ltd [2014] WASCA 130 …. 4.26, 4.64 Fraser v State Transport Authority (1985) 39 SASR 57 …. 6.23 Freeman v Home Office (No 2) [1984] QB 524 …. 16.13 Freestone v Murrumbidgee Local Health District [2016] NSWDC 53 …. 3.25, 3.79, 3.80 Freidin v St Laurent (2007) 17 VR 439 …. 3.24, 3.80 Freudenstein v Marhop Pty Ltd [2010] NSWSC 724 …. 10.37 Froom v Butcher [1976] QB 286 …. 10.23 Frost v Warner (2002) 209 CLR 509; 186 ALR 1 …. 14.6 Fulcher v Knott Investments Pty Ltd [2012] QSC 232 …. 1.23 Furness v Adrium Industries Pty Ltd [1996] 1 VR 668 …. 19.30 Fuz v Carter [2006] NSWSC 771 …. 19.7

G G and M v Armellin (2008) 219 FLR 359 …. 12.4 Gaba Formwork Contractors Pty Ltd v Turner Corp (1993) 32 NSWLR 175 …. 19.36, 19.37 Gala v Preston (1991) 172 CLR 243; 100 ALR 29 …. 5.19, 5.20, 5.21, 11.18, 11.19, 11.42, 11.43, 11.44, 11.45, 11.50, 11.51 Galashiels Gas Co Ltd v O’Donnell [1949] AC 275 …. 13.24, 13.26, 13.39, 13.40 Galea v Bagtrans Pty Ltd [2010] NSWCA 350 …. 14.28 Gales Holdings Pty Ltd v Tweed Shire Council (2013) 197 LGERA 381 …. 15.4, 15.21, 15.36, 15.55, 15.64, 15.65 Gambotto v WCP Ltd (1995) 182 CLR 432 …. 3.13 Gambriell v Caparelli (1975) 54 DLR (3d) 661 …. 16.14

Garzo v Liverpool/Campbelltown Christian School [2012] NSWCA 151 …. 3.36 Gaunt v Fynney (1872) LR 8 Ch App 8 …. 15.8, 15.65 Gazzard v Hutchesson (1995) Aust Torts Reports 81-337 …. 17.8 Geaghan v D’Aubert (2002) 36 MVR 542 …. 12.22 Gee v Burger [2009] NSWSC 149 …. 15.13, 15.64, 15.65 Geju Pty Ltd v Central Highlands Regional Council [2016] QSC 279 …. 8.16, 8.52 Georgeski v Owners Corporation Strata Plan No 49833 (2004) 62 NSWLR 534 …. 17.16 Gertz v Robert Welch Inc, 418 US 323 at 339-40 (1974) …. 20.25 Gett v Tabet (2009) 254 ALR 504 …. 12.53, 12.54 Geyer v Downs (1977) 138 CLR 91; 17 ALR 408 …. 6.6, 6.7, 6.25, 6.26 Gifford v Strang Patrick Stevedoring Pty Ltd (2003) 214 CLR 269; 198 ALR 100 …. 9.5, 9.6, 9.23 Giller v Procopets (2008) 24 VR 1 …. 9.17, 15.13, 15.64, 15.65 GIO (NSW) v Mackie (1990) Aust Torts Reps 81- 053 …. 4.32, 12.14, 12.53 Girlock (Sales) Pty Ltd v Hurrell (1982) 149 CLR 155; 40 ALR 45 …. 4.13 Girotto v Phillips Fox [2011] VSC 293 …. 8.29, 8.54 Gittani Stone Pty Ltd v Pavkovic (2007) Aust Torts Reports 81-924; [2007] NSWCA 355 …. 4.48, 4.56, 4.63 Giumelli v Johnston (1991) Aust Torts Reports 81-085 …. 16.12 Glasgow Corporation v Muir [1943] AC 448 …. 10.10, 10.36 Glendale Chemical Products Pty Ltd v Australian Competition and Consumer Commission and Barnes (1998) 90 FCR 40; [1999] ATPR 41-672 …. 1.23 GLMC Properties 2 Pty Ltd v Hassarati & Co Pty Ltd [2016] NSWSC 1642 …. 17.8 Go v R (1990) 73 NTR 1 …. 16.25

Goddard Elliott v Fritsch [2012] FSC 87 …. 3.13 Golden Eagle International Trading Pty Ltd Zhang (2007) 229 CLR 498; 234 ALR 131 …. 12.36, 12.43 Goldman v Hargrave [1967] 1 AC 645 …. 3.54, 3.55, 15.40 Goldsmith v Bisset (No 3) (2015) 71 MVR 53; [2015] NSWSC 634 …. 10.14, 10.49, 10.50 Goode v Angland [2016] NSWSC 1014 …. 11.31 Google Android Consumer Privacy Litigation, Re, unreported, 2013 WL 1283236 (ND Cal 2013) …. 18.7, 18.38 Gordon v Truong [2014] NSWCA 97 …. 10.31 Gorringe v Transport Commission (Tasmania) (1950) 80 CLR 357 …. 7.38 Gorris v Scott (1874) LR 9 Ex 125 …. 13.20 Goss v Nicholas [1960] Tas SR 133 …. 19.8, 19.55, 19.56 Government Insurance Office of New South Wales v Best (1993) Aust Torts Reports 81-210 …. 4.32, 12.79 Govic v Boral Australian Gypsum Ltd (2015) 47 VR 430; [2015] VSCA 130 …. 10.19, 13.17 Gracie (Owners) v Argentino (Owners): The Argentino (1889) 14 App Cas 519 …. 8.30, 19.28 Graham v Baker (1961) 106 CLR 340 …. 12.41, 12.96, 12.97 Graham v Hall (2006) 67 NSWLR 135 …. 4.34 Graham v KD Morris and Sons Pty Ltd [1974] Qd R 1 …. 17.8, 17.10 Graham v New South Wales (2001) 34 MVR 198 …. 6.6, 6.26 Graham v Welch [2012] QCA 282 …. 3.62, 3.66, 3.77 Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; 194 ALR 337 …. 2.8, 3.52, 3.77, 5.15, 5.16, 5.25, 5.27, 5.28, 5.31, 5.32, 7.14, 7.15, 7.21, 7.33, 7.34, 7.42–7.44, 8.34 Grant v Sun Shipping Co Ltd [1948] AC 549 …. 4.19 Grant v YYH Holdings Pty Ltd [2012] NSWCA 360 …. 18.26

Grantham Homes Pty Ltd v Interstate Permanent Building Society Ltd (1979) 37 FLR 191; 26 ACTR 1 …. 19.16 Gratax Pty Ltd v T D & C Pty Ltd [2013] QCA 385 …. 4.34, 4.63 Graves v West (No 2) [2015] NSWSC 306 …. 16.36 Gray v Motor Accident Commission (1998) 196 CLR 1; 158 ALR 485 …. 19.49 Gray v Richards (2014) 253 CLR 660; 313 ALR 579 …. 12.64 Great Lakes Shire Council v Dederer (2006) Aust Torts Reports 81-860; [2006] NSWCA 101 …. 11.27 Greta Holme, The [1897] AC 596 …. 12.101 Grice v State of Queensland [2006] 1 Qd R 222 …. 12.22 Griffin v Kotsifas [2011] SASC 161 …. 20.29 Griffiths v Kerkemeyer (1977) 139 CLR 161; 15 ALR 387 …. 12.16, 12.17, 12.18, 12.20, 12.21, 12.22, 12.23, 12.24, 12.25, 12.26, 12.27, 12.63, 12.66, 12.99, 12.100, 12.101, 12.103, 12.104 Grills v Leighton Contractors Pty Ltd (2015) 89 NSWLR 104; [2015] NSWCA 72 …. 10.17 Grimsey v Southern Regional Health Board (1997) 7 Tas R 67 …. 12.14 Grimsey v Southern Regional Health Board (1998) 8 Tas R 166 …. 12.14 Grincelis v House (2000) 201 CLR 321; 173 ALR 564 …. 12.18, 12.19 Grinham v Tabro Meats Pty Ltd; Victorian WorkCover Authority v Murray [2012] VSC 49 …. 3.25, 3.79, 3.80 Grosse v Purvis (2003) Aust Torts Reports 81-706 …. 15.13, 15.64, 15.65 Groves v United Pacific Transport Pty Ltd [1965] Qd R 62 …. 12.40, 12.41 Guru v Coles Supermarkets Australia Pty Ltd [2016] NSWDC 349 …. 11.27, 11.50 Gutman v McFall (2004) 61 NSWLR 599 …. 14.6

Gwam Investments Pty Ltd v Outback Health Screenings Pty Ltd (2010) 106 SASR 167 …. 8.38, 8.58, 8.59 Gwinnett v Day [2012] SASC 43 …. 18.20

H H v Royal Alexandra Hospital for Children (1990) Aust Torts Reports 81-000 …. 3.28 H Ltd v J (2010) 107 SASR 352 …. 19.2 Haber v Walker [1963] VR 339 …. 4.37, 4.38, 4.46, 4.49, 4.64 Habib v Commonwealth (No 2) (2009) 175 FCR 350; 254 ALR 250 …. 9.17 Hackshaw v Shaw (1984) 155 CLR 614; 56 ALR 417 …. 5.19 Hagen v Ian Heraud & Associates Pty Ltd (1998) 39 ATR 336 …. 3.19 Hahn v Conley (1971) 126 CLR 276; [1972] ALR 247 …. 6.7 Halliday v Nevill (1984) 155 CLR 1; 57 ALR 331 …. 17.17, 17.23, 17.24, 19.55, 19.56 Hallowell v Nominal Defendant (Queensland) [1983] 2 Qd R 266 …. 10.23 Halsey v Esso Petroleum Ltd [1961] 2 All ER 145 …. 15.8, 15.64 Hambrook v Stokes [1925] 1 KB 141 …. 9.2 Hamcor v Queensland [2014] QSC 244 …. 13.27 Hamcor Pty Ltd v State of Queensland [2016] 1 Qd R 271 …. 13.27 Hamps v Darby [1948] 2 KB 311 …. 18.4, 18.38 Hampton v BHP Billiton Minerals Pty Ltd [2012] WASC 285 …. 19.41 Haniotis v Dimitriou [1983] 1 VR 498 …. 19.11 Hanna v Sibbons (2010) 108 SASR 182 …. 20.23 Hannell v Amaca Pty Ltd [2006] WASC 310 …. 12.82 Hansen v Gloucester Developments Pty Ltd [1992] 1 Qd R 14; (1991) Aust Torts Reports 81-067 …. 19.39 Harbour Radio Pty Ltd v Trad (2013) 247 CLR 31; 292 ALR 192 ….

20.22, 20.23 Hardie Finance Corp Pty Ltd v Ahern (No 3) [2010] WASC 403 …. 8.29, 8.54 Hargrave v Goldman (1963) 110 CLR 40 …. 15.1 Harmer v Hare [2011] NSWCA 229 …. 11.27, 11.45 Harrington Estates (NSW) Pty Ltd (t/as Harrington Grove Country Club) v Turner [2016] NSWCA 369 …. 3.46 Harris v Carnegie’s Pty Ltd [1917] VLR 95 …. 15.19, 15.20, 15.21, 15.24 Harris v Commissioner for Social Housing [2013] ACTSC 186; (2013) ACTLR 98 …. 9.12 Harris v James (1876) 45 LJQB 545 …. 15.41 Harrison v Melhem (2008) 72 NSWLR 380; [2008] NSWCA 67 …. 12.22, 12.37 Harrison v Southwark and Vauxhall Water Co [1891] 2 Ch 409 …. 15.8 Harriton v Stephens (2006) 226 CLR 52; 226 ALR 391 …. 2.2, 5.7, 5.8, 5.25, 5.27, 5.28, 5.29, 5.31, 6.7, 12.2, 12.4 Harvey v Henzell [2015] QCA 261 …. 20.20 Harvey v PD (2004) 59 NSWLR 639 …. 4.3, 4.34, 4.35, 4.36, 4.64 Hawes v Holley [2008] NSWDC 147 …. 3.25 Hawira v Connolly [2008] QSC 004 …. 10.43 Hayes v Queensland [2016] QCA 191 …. 4.16 Haynes v G Harwood & Son [1935] 1 KB 146 …. 4.40, 4.63, 11.9 Heaven v Pender (1882) 9 QBD 302 …. 5.2 Heaven v Pender (1883) 11 QBD 503 …. 5.2, 5.3, 5.4, 5.5, 5.17, 5.21 Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465 …. 5.18, 8.3, 8.4, 8.6, 8.7, 8.21, 8.22, 8.23, 8.31 Henry v Thompson [1989] 2 Qd R 412 …. 19.49, 19.55, 19.56 Henwood v Municipal Tramways Trust (South Australia) (1938) 60

CLR 438 …. 11.39, 11.45 Herald & Weekly Times Pty Ltd v Buckley (2009) 21 VR 661 …. 20.27 Herald & Weekly Times Pty Ltd v Popovic [2003] VSCA 161 …. 20.17, 20.18 Herbert v Lando, 441 US 153, 176 (1979) …. 20.15 Herring v Boyle (1834) 1 CM & R 377; 149 ER 1126 …. 16.25, 16.26 Hesketh v Joltham Pty Ltd [2000] QCA 44 …. 19.30 Heydon v NRMA Ltd (2000) 51 NSWLR 1 …. 3.13, 3.79, 3.80 Hill v Forrester [2010] NSWCA 170 …. 12.22 Hill v Higgins [2012] NSWSC 270 …. 15.9, 17.1, 17.8, 19.23 Hill v Reglon Pty Ltd [2007] NSWCA 295 …. 18.34, 19.29 Hill v Van Erp (1997) 188 CLR 159; 142 ALR 687 …. 5.21, 5.23, 5.31, 5.32, 8.36 Hilton v Wallace (1989) Aust Torts Reports 80-231 …. 16.12 Hines v Commonwealth (1995) Aust Torts Reports 81-338 …. 12.53, 12.54 Hinkley v Star City Pty Ltd [2010] NSWSC 1389 …. 17.13 Hirst v Nominal Defendant [2005] Qd R 133 …. 4.41, 4.63, 4.64 Hoath v Connect Internet Services Pty Ltd (2006) 229 ALR 566 …. 18.21, 18.22, 18.23, 18.39 Hoffman v Boland [2013] NSWCA 158 …. 3.60, 6.7 Hollis v Vabu Pty Ltd (t/as Crisis Couriers) (2001) 207 CLR 21; 181 ALR 263 …. 2.11, 14.4, 14.12, 14.13, 14.47 Holloway v McFeeters (1956) 94 CLR 470 …. 4.13 Hollywood Silver Fox Farm v Emmett [1936] 2 KB 468 …. 15.11 Holroyd City Council v Zaiter [2014] NSWCA 109 …. 11.27, 11.50 Hope v Hunter and New England Area Health Service [2009] NSWDC 307 …. 3.25 Horan v Ferguson [1995] 2 Qd R 490 …. 16.9 Horkin v North Melbourne Football Club Social Club [1983] 1 VR 153

…. 19.10, 19.14 Hornsby Shire Council v Viscardi (2015) 214 LGERA 311; [2015] NSWCA 417 …. 4.17 Hosking v Runting [2005] 1 NZLR 1 …. 15.13, 15.65 Howard v Hamilton (1996) 16 WAR 292 …. 11.14 Howard v Jarvis (1958) 98 CLR 177 …. 6.8, 6.10, 6.25, 6.26 Howard v Queensland [2001] 2 Qd R 154 …. 13.22 Howard v Wing [2002] TASSC 35 …. 19.7 Howard Marine and Dredging Co Ltd v A Ogden & Sons (Excavations) Ltd [1978] QB 574 …. 8.15 Howe v Teefy (1927) 27 SR (NSW) 301 …. 18.17 Hoxton Park Residents’ Action Group Inc v Liverpool City Council (2010) 246 FLR 207; [2010] NSWSC 1312 …. 15.31, 15.61, 15.64, 15.65 Hoxton Park Residents’ Action Group Inc v Liverpool City Council (No 2) (2011) 256 FLR 156; [2011] NSWCA 363 …. 15.31, 15.61 Hoyts Pty Ltd v Burns (2003) 77 ALJR 1934 …. 4.26 Hudson Investment Group Ltd v Atanaskovic (2014) 311 ALR 290; [2014] NSWCA 255 …. 4.35 Huet v Irvine [2003] QSC 387 …. 12.21 Hughes v Lord Advocate [1963] AC 837 …. 4.56, 4.63 Humberstone v Northern Timber Mills (1949) 79 CLR 389 …. 14.10 Hume v Patterson [2013] NSWSC 1203 …. 11.31 Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; 296 ALR 3 …. 4.6, 4.17, 4.63, 14.44 Hunter v Canary Wharf Ltd [1997] AC 655 …. 9.18, 15.26, 15.29, 15.30, 15.31, 15.32, 15.56, 15.64, 15.65 Hunter and New England Local Health District v McKenna (2014) 253 CLR 270; 314 ALR 505 …. 6.22, 6.25–6.27, 7.16, 7.42, 7.43 Hunter Area Health Service v Presland (2005) 63 NSWLR 22 …. 4.50, 4.63

Hunter BNZ Finance Ltd v Australia and New Zealand Banking Group Ltd [1990] VR 41 …. 18.22 Husher v Husher (1999) 197 CLR 138; 165 ALR 384 …. 12.47, 12.49, 12.50 Hustler Magazine v Falwell, 485 US 46 (1988) …. 9.15 Hutchins v Maughan [1947] VLR 131 …. 18.3, 18.39 Hutchison v Fitzpatrick [2009] ACTSC 43 …. 16.9, 16.39, 16.40

I Ibrahim v Davis [2013] VSCA 238 …. 5.14 Imbree v McNeilly (2008) 236 CLR 510; 248 ALR 647 …. 3.7, 3.12, 3.13, 3.79, 3.81, 10.14, 11.17, 11.45 Imperial Chemical Industries Ltd v Shatwell [1965] AC 656 …. 13.37 Inland Revenue Commissioners, Re; Ex parte Rossminster Ltd [1980] AC 952 …. 18.6, 18.39 Innes v Wylie (1844) 1 Car & K 257; 174 ER 800 …. 16.10 Insight Vacations Pty Ltd v Young (2011) 243 CLR 149; 276 ALR 497 …. 11.35, 11.37, 11.50, 11.51 Insurance Commissioner v Joyce (1948) 77 CLR 39 …. 11.10, 11.12, 11.16, 11.17, 11.19, 11.45 Integrated Direct Marketing LLC v May, 495 SW 3d 73, 76 (Ark 2016) …. 18.25 Intel Corporation v Hamidi, 71 P 3d 296 (Cal, 2003) …. 18.7, 18.38, 18.39 Interchase Corp Ltd v ACN 010 087 573 Pty Ltd [2003] 1 Qd R 26 …. 8.28 Invercargill City Council v Hamlin [1996] AC 624 …. 8.48 Inverell Municipal Council v Pennington (1993) Aust Torts Reports 81234 …. 3.33, 3.34, 3.35, 3.78, 3.81 iPhone Application Litigation, Re, 844 F Supp 2d 1040 (ND Cal 2012) …. 18.7, 18.38

Ira S Bushey & Sons Inc v United States 398 F 2d 167 (1968) …. 14.12 Ireland v B & M Outboard Repairs [2015] QSC 84; [2015] ALMD 2933 …. 11.27 Italiano v Barbaro (1993) 40 FCR 303; 114 ALR 21 …. 11.44 Ives v Western Australia (No 8) [2013] WASC 277 …. 20.17, 20.23

J J & J Sports Productions v Coyne, 857 F Supp 2d 909 (ND Cal 2012) …. 18.25 Jaber v Rockdale City Council (2008) Aust Torts Reports 81-952; [2008] NSWCA 98 …. 11.28, 11.31 Jackson v Harrison (1978) 138 CLR 438; 19 ALR 129 …. 11.44 Jackson v Lithgow City Council [2008] NSWCA 312 …. 10.46, 10.49, 10.50 Jackson v McDonald’s Australia Ltd [2014] NSWCA 162 …. 4.14, 4.64, 11.27 Jaensch v Coffey (1985) 155 CLR 549; 54 ALR 417 …. 5.19, 9.2, 9.3, 9.8, 9.23 James v Harrison (1977) 18 ACTR 36 …. 14.16 Jansen v Dewhurst [1969] VR 421 …. 19.27 Janvier v Sweeney [1919] 2 KB 316 …. 9.16 Jausnik v Nominal Defendant (No 5) (2016) 78 MVR 1; [2016] ACTSC 306 …. 4.9, 4.48, 4.63, 4.64 Jazairy v Najjar (1998) Aust Torts Reports 81-476 …. 4.32 Jedson Engineering Inc v Spirit Construction Services, 720 F Supp 2d 904 (SD Oh, 2010) …. 18.7, 18.38 Jellie v Commonwealth [1959] VR 72 …. 3.58 Jemena Gas Networks (NSW) Ltd v Mine Subsidence Board (2011) 243 CLR 558 at 566; 277 ALR 257 …. 15.22 Jenkins v Jackson (1888) 40 Ch D 71 …. 15.41

JMD v GJH [2012] WADC 124 …. 9.17 Joel v Morison (1834) 6 Car & P 501; 172 ER 1338 …. 14.15 John Fairfax Publications Pty Ltd v Gacic (2007] CLR 291 …. 20.6, 20.37 John F Goulding Pty Ltd v Victorian Railways Commissioners (1932) 48 CLR 157 …. 18.31, 18.32 John Gallagher Panel Beating Co Pty Ltd v Palmer [2007] NSWSC 627 …. 19.38 John Holland Construction & Engineering Pty Ltd v Majorca Projects Pty Ltd & Bruce Henderson Pty Ltd (1996) 13 BCL 235 …. 3.19 John Pfeiffer Pty Ltd v Canny (1981) 148 CLR 218; 36 ALR 466 …. 13.31 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503; 176 ALR 625 …. 1.25 John R v Oakland Unified School District, 48 Cal 3d 438 (1989) …. 14.19 Johnson Matthey (Aust) Ltd v Dascorp Pty Ltd (2003) 9 VR 171 …. 19.29, 19.30 Johnson v Buchanan (2012) 223 A Crim R 132 …. 17.4 Johnson v Northern Territory [2016] NTSC 49 …. 19.46, 19.55 Jolley v Sutton London Borough Council [2000] 3 All ER 409 …. 4.56 Jones v Dapto Leagues Club Ltd [2008] NSWCA 32 …. 10.46, 10.49, 10.50 Jones v Dunkel (1959) 101 CLR 298 …. 4.7, 4.13, 4.14 Jones v Dyldam Developments Pty Ltd [2007] NSWSC 754 …. 12.103 Jones (by his next friend Jones) v Moylan (1997) 18 WAR 492 …. 12.21 Jongen v CSR Ltd (1992) Aust Torts Reports 81- 192 …. 12.43 Joslyn v Berryman; Wentworth Shire Council v Berryman (2003) 214 CLR 552; 198 ALR 137 …. 10.5, 10.10, 10.11, 10.13, 10.14, 10.17, 10.19, 10.36, 10.37, 10.38, 10.43, 10.49, 10.50, 11.15, 11.20

Jovanovski v Billbergia Pty Ltd [2010] NSWSC 211 …. 4.9, 4.21, 4.27, 4.63, 4.64 Jurox Pty Ltd v Fullick [2016] NSWCA 180 …. 3.46, 3.77

K Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51; 138 ALR 577 …. 16.24 Kahler v Midland Bank Ltd [1950] AC 24 …. 18.16 Kalaba v Commonwealth [2004] FCA 763 …. 15.13, 15.64, 15.65 Kalaba v Commonwealth [2004] FCAFC 326 …. 15.13, 15.64, 15.65 Kalaba v Commonwealth [2005] HCA Trans 478 …. 15.13, 15.64, 15.65 Karatjas v Deakin University (2012) 35 VR 355 …. 6.11 Kars v Kars (1996) 187 CLR 354; 141 ALR 37 …. 12.20, 12.100, 12.103, 12.104 Kavanagh v Akhtar (1998) 45 NSWLR 588 …. 4.51, 4.59, 4.60, 4.63, 4.64 Kearney v Roucek (1997) 21 Fam LR 537 …. 16.33 Kelly v Bega Valley County Council (NSWCA, Hope, Glass and Samuels JJA, 13 September 1982, unreported) …. 10.13, 10.30, 10.49, 10.50 Kelly v Bluestone Global Ltd (in liq) [2016] WASCA 90 …. 14.14 Kellys Property Management Services Pty Ltd v Anjoshco Pty Ltd (t/as McDonalds BP Chinderah) [2016] NSWCA 341 …. 10.32 Kelsen v Imperial Tobacco Co Ltd [1957] 2 QB 334 …. 17.8 Kennon v Kennon (1997) 139 FLR 118 …. 16.33 Kenny v Eyears [2003] QSC 439 …. 12.98 Khorasandjian v Bush [1993] QB 727 …. 15.29, 15.30, 15.64 King v Philcox (2015) 255 CLR 304; 320 ALR 398; [2015] HCA …. 4.60, 9.10, 9.23

King v Rail Corporation New South Wales [2013] NSWSC 241 …. 10.37 King v Western Sydney Local Health Network [2013] NSWCA 162 …. 4.3, 4.22, 4.63 Kingshott v Goodyear Tyre & Rubber Co Australia Ltd (No 2) (1987) 8 NSWLR 707 …. 13.30 Kirk v Gregory (1876) 1 Ex D 55 …. 18.5, 19.23, 19.55 Knott Investments Pty Ltd v Fulcher [2014] 1 Qd R 21; [2013] QDA 67 …. 1.23, 4.41 Kondis v State Transport Authority (1986) 154 CLR 672; 55 ALR 225 …. 14.26, 14.27, 14.28, 14.29, 14.47 Kraemers v Attorney-General (Tas) [1966] Tas SR 113 …. 15.17, 15.20, 15.64, 15.65 Krakowski v Eurolynx Properties Ltd (1995) 183 CLR 563; 130 ALR 1 …. 19.50 Kremen v Cohen, 337 F 3d 1024 (9th Cir, 2003) …. 18.21, 18.24, 18.25 Kuhl v Zurich Financial Services (2011) 276 ALR 375 …. 5.16, 5.25, 5.31, 5.32 Ku-ring-gai Municipal Council v Bonnici [2002] NSWCA 313 …. 15.21 Kuru v New South Wales (2008) 236 CLR 1; 246 ALR 260 …. 17.18, 17.23, 17.24, 19.56 Kuwait Airways Corp v Iraqi Airways Co (Nos 4 and 5) [2002] 2 AC 883 …. 18.11, 19.35

L Lamb v Camden London Borough Council …. 6.18 Lamb v Cotogno (1987) 164 CLR 1; 74 ALR 188 …. 19.43, 19.45, 19.49, 19.51, 19.55, 19.56 Lanestar Pty Ltd v Arapower Pty Ltd; Deasy Investments Pty Ltd v Monrest Pty Ltd [1996] QCA 466 …. 15.16, 15.20, 15.21, 15.30, 15.31, 15.64, 15.65

Langmaid v Dobsons Vegetable Machinery Pty Ltd (2014) 24 Tas R 18; [2014] Aust Torts Reports ¶82-177; [2014] TASFC 6 …. 4.14, 4.56, 4.63 Laris v Lin [2017] NSWSC 279 …. 19.40, 19.49 Larsen v Grace Worldwide (Australia) Pty Ltd [2016] NSWCA 251 …. 4.14, 4.64 Laugher v Pointer (1826) 5 B & C 547; 108 ER 204 …. 14.14 Lawlor v Johnston [1905] VLR 714 …. 17.8 Laws v Florinplace Ltd [1981] 1 All ER 659 …. 15.15 Laybutt v Glover Gibbs Pty Ltd (t/as Balfours NSW Pty Ltd) (2005) 221 ALR 310 …. 3.51 Le Lievre v Gould [1893] 1 QB 491 …. 5.4 League Against Cruel Sports Ltd v Scott [1986] QB 240 …. 17.3 Leame v Bray (1803) 3 East 593; 102 ER 724 …. 16.3 Leask Timber and Hardware Pty Ltd v Thorne (1961) 106 CLR 33 …. 13.31 Lee v Carlton Crest Hotel (Sydney) Pty Ltd [2014] NSWSC 1280 …. 3.46, 3.77 Lee v Elgammal [2016] NSWCA …. 4.26 Lees v Dunkerley Bros [1911] AC 5 …. 14.22 Leichhardt Municipal Council v Montgomery (2007) 230 CLR 22; 233 ALR 200 …. 14.31 Leigh v Gladstone (1909) 26 TLR 139 …. 19.2, 19.3 Leighton Contractors Pty Ltd v Fox (2009) 240 CLR 1; 258 ALR 673 …. 14.27, 14.48 Lennon v Gympie Motel [2016] QSC 315 …. 3.34, 10.13, 10.49, 10.50 Lenovo Adware Litigation, Re, unreported, 2016 WL 6277245 (ND Cal 2016) …. 18.7, 18.38 Lepore v New South Wales (2001) 52 NSWLR 420 …. 14.47 Letang v Cooper [1965] 1 QB 232 …. 16.29, 16.30

Ley v Lewis [1952] VLR 119 …. 19.29 Liftronic Pty Ltd v Unver (2001) 179 ALR 321 …. 10.32, 10.49, 10.50 Lim Poh Choo v Camden and Islington Area Health Authority [1980] AC 174 …. 12.5 Lindner v City of Marion [2015] SASC 152 …. 15.33 Lipohar v R (1999) 200 CLR 485; 168 ALR 8 …. 1.25 Liquor Distributors Pty Ltd v State Bank of New South Wales (NSWSC, O’Keefe CJ, Comm D, 28 March 1994, unreported, BC9402384) …. 19.16 Lister v Hesley Hall Ltd [2002] 1 AC 215; [2001] 2 All ER 769 …. 14.3, 14.4, 14.19, 14.20, 14.47, 14.48 Lister v Romford Ice & Cold Storage Co Ltd [1957] AC 555 …. 14.22, 14.23 Liverpool Catholic Club Ltd v Moor [2014] NSWCA 394; (2015) Aust Torts Reports ¶82-199 …. 11.28 Livsey v Australian National Car Parks Pty Ltd [2014] NSWDC 232 …. 11.27 LJP Investments Pty Ltd v Howard Chia Investments Pty Ltd (1989) 24 NSWLR 490 …. 17.7, 17.8, 19.40, 19.49, 19.50 Lloyd v Borg [2013] 84 NSWLR 652…. 14.6 Lloyd v Grace, Smith & Co [[1912] AC 716 …. 14.19, 14.47 Locke v Bova [2004] NSWSC 534 …. 12.41 Lord v Nominal Defendant (1980) 24 SASR 458 …. 16.34 Lormine Pty Ltd v Xuereb (2006) NSWCA 200 …. 11.31 Louisiana Crawfish Producers Association West v Amerada Hess Corp, 935 So 2d 380 (La App, 2006) …. 8.50 Lowes v Amaca Pty Ltd [2011] WASC 287 …. 12.82 Lowns v Woods (1996) Aust Torts Reports 81-376 …. 6.12, 6.13, 6.25, 6.26 Lucantonio v Stichter [2014] NSWCA 5 …. 4.6, 4.26 Luxton v Vines (1952) 85 CLR 352 …. 4.13, 4.17

Lym International Pty Ltd v Marcolongo (2011) BPR 29,465; [2011] NSWCA 303 …. 4.27, 4.34, 4.63, 4.64 Lynch v Knight (1861) 9 HLC 577 at 600; 11 ER 854 …. 4.59 Lynch v Lynch (1991) 25 NSWLR 411 …. 6.7 Lyons v Fletcher (2014) 66 MVT 219; [2014] NSWCA 67…. 4.9

M Macleay Pty Ltd (t/as Wobbies World) v Moore (1992) Aust Torts Reports 81-151 …. 11.38, 11.50, 11.51 Macquarie International Health Clinic Pty Ltd v Sydney Local Health District (No 10) [2016] NSWSC 1587 …. 19.40 Macrocom Pty Ltd v City West Centre Pty Ltd [2003] NSWSC 898 …. 19.35, 19.38 Magnou v Australian Wool Testing Authority Ltd [2007] NSWCA 357 …. 12.37 Mahony v J Kruschich (Demolitions) Pty Ltd (1985) 156 CLR 522; 59 ALR 722 …. 4.42, 4.43, 4.44, 4.63, 4.64 Maiward v Doyle [1983] WAR 210 …. 12.27 Majindi v Northern Territory (2012) 31 NTLR 150 …. 16.6, 16.10, 19.46, 19.52, 19.55 Malone v Laskey [1907] 2 KB 141 …. 15.28, 15.29, 15.30, 15.31 Manchester Corporation v Farnworth [1930] AC 171 …. 15.44 Mann v Elbourn (1974) 8 SASR 298 …. 12.52, 12.103 Mann v O’Neill (1997) 191 CLR 204; 145 ALR 682 …. 20.19, 20.20, 20.21 Manning v New South Wales [2005] NSWSC 958 …. 12.68, 12.69, 12.76, 12.80, 12.103 Manser v Spry (1994) 181 CLR 428; 124 ALR 539 …. 12.95 Mansfield v Great Lakes Council (2016) 77 MVR 252; 217 LGERA 317; [2016] NSWCA 204 …. 4.26

Marc Rich & Co AG v Bishop Rock Marine Co Ltd: ‘The Nicholas H’ [1996] AC 211 …. 8.47 March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; 99 ALR 423 …. 4.7, 4.8, 4.9, 4.10, 4.19, 4.36, 4.43, 4.44, 4.45, 4.46, 4.50, 4.51, 4.64, 10.22, 10.46, 14.44 Marinko v Masri (2000) Aust Torts Reports 81-581 (NSWCA) …. 12.21 Marsden v Ydalia Holdings (WA) Pty Ltd (2006) Aust Torts Reports 81-840; [2006] WASCA 52 …. 3.63 Marsh v Baxter (2015) 49 WAR 1 …. 15.9, 15.11, 15.31, 15.64, 15.65 Matthews v SPI Electricity Pty Ltd (Ruling No 2) (2011) 34 VR 584 …. 13.16, 13.39, 13.40 May v Thomas [2014] WASCA 176 …. 19.8, 19.9 Maynes v Casey [2011] NSWCA 156 …. 15.13, 15.64, 15.65, 17.17, 17.23, 17.24 Mbakwe v Sarkis [2009] NSWCA 330 …. 8.18 Mbasogo v Logo Ltd (No 1) [2007] QB 846 …. 9.18 MBP (SA) Pty Ltd Gogic (1991) 171 CLR 657; 98 ALR 193 …. 12.18 MC Multi-Family Development LLC v Crestdale Associates Ltd, 193 P 3d 536, 543 (Nev 2008) …. 18.25 Macarthur Districts Motor Cycle Sportsmen Inc v Ardizzone (2004) Aust Torts Reports 81-744; [2004] NSWCA 145 …. 12.38, 12.103 McClelland v Symons [1951] VLR 157 …. 19.6, 19.7 McCoy Constructions Pty Ltd v Dabrowski [2001] QSC 413 …. 15.16 McDonald v National Grid Electricity Transmission plc [2015] AC 1128 …. 13.5 McDonald (t/as BE McDonald Transport) v Girkaid Pty Ltd (2004) Aust Torts Reports 81- 768; [2004] NSWCA 297 …. 13.15, 13.39 McFadzean v Construction, Forestry, Mining and Energy Union [2004] VSC 289 …. 16.21, 16.26, 16.39, 16.40 McGhee v National Coal Board [1973] 1 WLR 1 …. 4.19, 4.25, 4.30 McHale v Watson (1964) 111 CLR 384 …. 16.4, 16.28, 16.29, 16.30,

16.31, 16.32 McHale v Watson (1966) 115 CLR 199 …. 3.7, 3.9, 3.33, 3.81, 10.13, 10.14, 10.49 Mackenzie v Nominal Defendant [2005] NSWCA 180 …. 10.37, 10.43 McKenzie v Powley [1916] SALR 1 …. 15.56 McKinnon Industries Ltd v Walker [1951] 3 DLR 577 …. 15.10 McLean v Tedman (1984) 155 CLR 306; 56 ALR 359 …. 3.32, 4.48, 10.15, 10.17, 10.19, 14.38 McLeod v Rub-a-Dub Car Wash (Malvern) Pty Ltd (VSC, Stephen J, 29 February 1972, unreported) …. 15.30, 15.31 McMullin v ICI Australia Operations Pty Ltd (1997) 72 FCR 1 …. 7.36, 8.43, 8.58, 8.59 McNamara v Duncan (1971) 26 ALR 584 …. 16.12, 16.13, 16.39, 16.40, 19.17 McPherson v Beath (1975) 12 SASR 174 …. 16.20, 16.39, 16.40 McPherson v Whitfield [1996] 1 Qd R 474 …. 11.15 McPherson’s Ltd v Eaton (2005) 65 NSWLR 187 …. 5.14, 5.15 McVicar v S & J White Pty Ltd (t/as Arab Steed Hotel) (2007) 97 SASR 160 …. 13.20, 13.39, 13.40, 14.30 Meandarra Aerial Spraying Ltd v GEJ Geldard Pty Ltd [2013] 1 Qd R 319; [2012] QCA 315 …. 3.36, 3.77 Medlin v State Government Insurance Commission (1995) 182 CLR 1; 127 ALR 180 …. 4.41, 4.64, 12.52, 12.103 Meering v Graham-White Aviation Co (1919) 122 LT 44 …. 16.25, 16.26 Melchior v Sydney Adventist Hospital Ltd [2008] NSWSC 1282 …. 3.25 Mercedes Holdings Pty Ltd v Waters (No 5) [2011] FCA 1428 …. 13.5 Mercer v Commissioner for Road Transport and Tramways (NSW) (1937) 56 CLR 580 …. 3.14, 3.80 Merck Sharpe & Dohme (Aust) Pty Ltd v Peterson (2011) 196 FCR 145;

284 ALR 1 …. 1.23, 4.16 Meredith v Commonwealth (No 2) [2013] ACTSC 221; (2013) 280 FLR 385 …. 8.29, 8.54, 13.4, 13.12, 13.40 Merryweather v Nixan (1799) 8 Term Rep 186; 101 ER 1337 …. 14.36, 14.37 Meshlawn Pty Ltd v Queensland [2010] QCA 181 …. 7.34, 7.42, 7.43 Metrolink Victoria Pty Ltd v Inglis (2009) 25 VR 633; (2009) Aust Torts Reports 82-032; [2009] VSCA 227 …. 4.56, 4.57, 4.58, 4.63, 4.64 Michos v Council of the City of Botany Bay (2012) 189 LGERA 25 …. 15.36, 15.40, 15.53, 15.56, 15.64 Mid Density Developments Pty Ltd v Rockdale Municipal Council (1993) 44 FCR 290; 116 ALR 460 …. 8.25, 8.54 Middleton v Aon Risk Services Australia Ltd [2008] WASCA 239 …. 8.29, 8.53, 8.54 Milk Bottles Recovery Ltd v Camillo [1948] VLR 344 …. 18.25, 18.26, 18.39 Miller v Jackson [1977] QB 966 …. 15.6 Miller v Miller (2011) 242 CLR 446; 275 ALR 611 …. 5.21, 5.28, 5.31, 5.32, 11.18, 11.45, 11.50, 11.51 Miller v Sotiropoulos (NSWCA, Mason P, Meagher and Powell JJA, 18 August 1997, unreported, BC9703844) …. 19.7 Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357; 270 ALR 204 …. 8.8 Ming Kuei Property Investments Pty Ltd v Hampson [1995] 2 Qd R 251; (1994) 126 ALR 313 …. 18.31 Minister Administering the Environmental Planning and Assessment Act 1979 v San Sebastian Pty Ltd [1983] 2 NSWLR 268 …. 5.18 Minister of State for the Interior v RT Co Pty Ltd (1963) 107 CLR 1; [1963] ALR 57 …. 19.41 Minter v Eacott (1952) 69 WN (NSW) 93 …. 15.56

Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632 …. 20.6, 20.37 Mitchell v Tsiros (No 2) [1982] VR 301 …. 15.49 Mitsui OSK Lines Ltd v The Ship ‘Mineral Transporter’ [1983] 2 NSWLR 564 …. 8.45, 8.46, 8.47, 8.48, 8.49 Mizikovsky v Queensland Television Ltd (No 3) [2011] QSC 375 …. 20.17 Moama Bowling Club Ltd v Thomson Group Pty Ltd [2014] VSCA 245 …. 4.14, 4.64 Mobbs v Kain (2009) 54 MVR 179; [2009] NSWCA 301 …. 3.3, 3.40, 3.46, 3.77, 3.78 Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; 176 ALR 411 …. 4.8, 4.9, 6.11, 6.18, 6.22, 6.23, 6.25, 6.26 Mohr v Cleaver [1986] WAR 67 …. 8.12, 8.16 Monaghan Surveyors Pty Ltd v Stratford Glen- Avon Pty Ltd [2012] NSWCA 94 …. 4.4, 13.26, 13.33, 13.39 Montana Hotels Pty Ltd v Fasson (1986) 69 ALR 258 …. 15.35, 15.39 Moon v Whitehead (2015) 10 ACTLR 309 …. 16.13, 16.33, 16.39, 16.40, 19.43 Moore v Devanjul Pty Ltd (No 5) [2013] QSC 323 …. 17.13, 19.11 Moore v Lambeth County Court Registrar (No 2) [1970] 1 QB 560 …. 19.44 Moorgate Mercantile Co Ltd v Finch [1962] 1 QB 701 …. 18.25, 18.26, 18.38 Morocz v Marshman [2016] NSWCA 202 …. 3.26, 3.80 Morrison Sports Ltd v Scottish Power UK plc 2011 SC (UKSC) 1; [2010] UKSC 37 …. 13.6 Morton v Tasmania [2006] TASSC 62 …. 11.9 Motor Vehicle Insurance Trust v Wilson [1976] WAR 175 …. 10.23 Motorcycle Events Group Australia Pty Ltd v Kelly [2013] NSWCA 361 …. 11.35

Mott v Fire and All Risks Insurance Co Ltd [2000] 2 Qd R 34 …. 12.63 Mount Isa Mines Ltd v Pusey (1970) 125 CLR 383; [1971] ALR 253 …. 4.56, 4.57, 4.58, 4.63, 4.64, 9.5, 15.55 Mouse’s Case (1608) 12 Co Rep 63; 77 ER 1341 …. 19.3 Mudie v Gainriver Pty Ltd [2002] 2 Qd R 53 …. 15.60 Mules v Ferguson [2015] QCA 005 …. 3.25, 3.79, 3.80, 12.14 Mulligan v Coffs Harbour City Council (2005) 223 CLR 486; 221 ALR 764 …. 3.28, 3.34, 3.39, 3.63, 3.77, 3.78, 3.81 Mummery v Irvings Pty Ltd (1956) 96 CLR 99 …. 4.32, 13.20, 13.40 Mungis (No 2) Pty Ltd v Still [2011] NSWCA 261 …. 3.36 Munro v Southern Dairies Ltd [1955] VLR 332 …. 15.7 Murphy v Brown (1985) 1 NSWLR 131 …. 19.27 Murray v Ministry of Defence [1988] 1 WLR 692 …. 16.25, 16.26 Mutual Life and Citizens’ Assurance Co Ltd v Evatt (1968) 122 CLR 556; [1969] ALR 3 (HCA) …. 8.7, 8.10, 8.11, 8.14, 8.15, 8.16, 8.23, 8.24, 8.25, 8.29, 8.52, 8.54 Mutual Life and Citizens’ Assurance Co Ltd v Evatt (1970) 122 CLR 628; [1971] AC 793 (PC) …. 8.7, 8.14, 8.15, 8.16, 8.19, 8.20 Myer Stores Ltd v Jovanovic [2004] VSC 478 …. 19.33, 19.37 Myer Stores Ltd v Soo [1991] 2 VR 597; (1991) Aust Torts Reports 81077 …. 16.23, 16.25, 16.39, 16.40, 19.44, 19.55, 19.56

N Nader v Urban Transit Authority of New South Wales (1985) 2 NSWLR 501 …. 4.51, 4.57, 4.59, 4.60, 4.63, 4.64, 7.1 Nagle v Rottnest Island Authority (1993) 177 CLR 423; 112 ALR 393 …. 3.33, 3.34, 3.63, 3.81, 11.29 Najdovski v Crnojlovic (2008) 72 NSWLR 728 …. 12.44 Namala v Northern Territory (1996) 131 FLR 468 …. 12.74 Napaluma v Baker (1982) 29 SASR 192 …. 12.74

National Australia Bank Ltd v Nemur Varity Pty Ltd (2002) 4 VR 252 …. 19.35, 19.38 National Coal Board v JE Evans & Co (Cardiff) Ltd [1951] 2 KB 861 …. 18.8 National Insurance Co of New Zealand v Espagne (1961) 105 CLR 569 …. 12.92, 12.95, 12.96 Nationwide News Pty Ltd v Weatherup [2017] QCA 70 …. 20.17 Naxakis v Western General Hospital (1999) 197 CLR 269; 162 ALR 540 …. 2.5, 3.5, 3.16, 3.17, 3.22, 3.79 Neill v New South Wales Fresh Food & Ice Pty Ltd (1963) 108 CLR 362; [1963] ALR 258 …. 3.52 Neindorf v Junkovic (2005) 222 ALR 631; (2006) Aust Torts Reports 81-120 …. 3.39, 3.48, 3.66, 3.77, 3.78, 5.15, 5.32 Nelson v John Lysaght (Australia) Ltd (1975) 132 CLR 201; 5 ALR 289 …. 3.58 Nepean Blue Mountains Local Health District v Starkey [2016] NSWCA 114 …. 4.9 New South Wales v Bujdoso (2005) 227 CLR 1; 222 ALR 663 …. 3.47, 3.49, 3.50, 3.58, 3.77, 6.9, 6.10, 6.25, 6.26 New South Wales v Bujdoso (2007) 69 NSWLR 302; (2007) Aust Torts Reports 81-876 …. 3.50, 4.50, 6.9 New South Wales v DC [2017] HCA 22 …. 5.33 New South Wales v Fahy (2007) 232 CLR 486; 236 ALR 406 …. 3.28, 3.39, 3.46, 3.47, 3.61, 3.77, 3.78, 3.81 New South Wales v Godfrey (2004) Aust Torts Reports 81-741; [2004] NSWCA 113 …. 5.30, 6.18, 6.25, 6.26 New South Wales v Ibbett (2006) 229 CLR 638; 231 ALR 485 …. 19.43, 19.47, 19.53, 19.55, 19.56 New South Wales v Kable (2013) 298 ALR 144 …. 16.24, 19.21, 19.55, 19.56 New South Wales v Lepore; Samin v Queensland; Rich v Queensland

(2003) 212 CLR 511; 195 ALR 412 …. 2.11, 14.19, 14.20, 14.32, 14.33, 14.47, 14.48 New South Wales v McMaster (2015) 91 NSWLR 666 …. 19.3, 19.5 —19.9, 19.55, 19.56 New South Wales v Paige [(2002) 60 NSWLR 371; [2002] NSWCA 235] …. 4.16 New South Wales v Riley (2003) 57 NSWLR 496 …. 12.84, 16.24, 19.14, 19.15, 19.21, 19.45, 19.50, 19.55, 19.56 New South Wales v Roberson (2016) 338 ALR 166 …. 16.23, 16.39, 16.40, 19.21, 19.55 New South Wales v Stevens (2012) 82 NSWLR 106 …. 19.23, 19.25, 19.55, 19.56 New South Wales v TD (2013) 83 NSWLR 566 …. 16.23, 16.24, 16.39, 16.40, 19.21, 19.55, 19.56 New South Wales v Tyszyk [2008] NSWCA 107 …. 15.43 New South Wales v West (2008) 165 ACTR 47 …. 7.2 New York Times Co v Sullivan, 376 US 254 (1964) …. 20.2 Newington v Windeyer (1985) 3 NSWLR 555 …. 17.12, 17.14, 17.15, 17.23, 17.24, 18.13 Nicholls v F Austin (Leyton) Ltd [1946] AC 493 …. 13.20 Nicol v Whiteoak (No 2) [2011] NSWSC 1486 …. 11.31, 11.51 Nimmo v Alexander Cowan & Sons Ltd [1968] AC 107 …. 13.29, 13.30 Nominal Defendant v Bacon (2014) 67 MVR 425; [2014] NSWCA 275 …. 4.19, 4.34 Nominal Defendant v Dowedeit [2016] NSWCA 332 …. 10.32 Nominal Defendant v Gardikiotis (1996) 186 CLR 49; 136 ALR 1 …. 12.64 Nominal Defendant v Green (2013) 64 MVR 354 …. 10.32 Nominal Defendant v Haslbauer (1967) 117 CLR 448 …. 4.32 Nominal Defendant v Lane [2004] NSWCA 405 …. 12.38 Nominal Defendant v Ross (2014) 87 NSWLR 238 …. 10.31

Norris v Blake (by his Tutor Porter) (No 2) (1997) 41 NSWLR 49 …. 12.52, 12.103 Norris v Sibberas [1990] VR 161 …. 8.16, 8.20, 8.52 North v Thompson [1971] WAR 103 …. 12.98 North Shore City Council v Body Corporate 188529 (Sunset Terraces) [2010] 3 NZLR 486 …. 8.48 Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313; 146 ALR 572 …. 14.30 Northern Territory of Australia v Deutscher Klub (Darwin) Inc (1994) 4 NTLR 25 (NTCA) …. 7.2

O OBG Ltd (in liq) v Allan [2008] 1 AC 1 …. 18.23, 18.24 O’Brien v Noble (2012) 6 ACTLR 132 …. 12.11 O’Connor v Insurance Commission of Western Australia (2016) 76 MVR 102; [2016] WASCA 95 …. 10.31, 10.49 O’Connor v SP Bray Ltd (1937) 56 CLR 464 …. 13.9, 13.31, 13.39, 13.40 Odisho v Bonazzi [2014] VSCA 11 …. 4.26, 4.64 O’Dwyer v Leo Buring Pty Ltd [1966] WAR 67 …. 3.58 Ogden v Bells Hotel Pty Ltd [2009] VSC 219 …. 6.23 Oldham v Lawson (No 1) [1976] VR 654 …. 15.28, 15.29, 15.30, 15.31, 15.64, 15.65 O’Leary v Lamb (1973) 7 SASR 159 …. 8.20 Ollis v New South Wales Crime Commission (2007) 177 A Crim R 306 …. 20.20 O’Neill v Rhodes [2016] TASSC 17 …. 12.44 Onus v Telstra Corp Ltd [2011] NSWSC 33 …. 15.52, 15.59, 15.60, 15.64 Oran Park Motor Sports Pty Ltd v Fleissig; Teamfox Pty Ltd v Fleissig

[2002] NSWCA 371 …. 11.7 Oropesa, The [1943] P 32 …. 4.36, 4.46 Osborne v Downer EDI Mining Pty Ltd [2010] QSC 470 …. 10.19 O’Shane v Harbour Radio Pty Ltd (2013) 85 NSWLR 698; 304 ALR 314…. 20.13 O’Shea v Permanent Trustee Co of NSW Ltd [1971] Qd R 1 …. 11.14 Overseas Tankship (UK) Ltd v Miller Steamship Pty Ltd (The Wagon Mound (No 2)) [1967] 1 AC 617 …. 3.39, 4.55, 4.63, 4.64, 15.55 Overseas Tankship (UK) Ltd v Morts Dock and Engineering Co Ltd (The Wagon Mound (No 1)) [1961] AC 388 …. 2.7, 2.21, 4.53, 4.54, 4.55, 4.58, 4.59, 4.63, 4.64 Owners - Strata Plan No 4085 v Mallone (2006) 12 BPR 23,691; [2006] NSWSC 1381 …. 15.42, 15.52 Owners - Strata Plan No 61288 v Brookfield Australia Investments Ltd [2013] NSWCA 317 …. 8.29 Oyston v St Patrick’s College (No 2) [2013] NSWCA 310 …. 4.17, 4.63

P Page v McGovern (2008) 17 Tas R 208 …. 20.20 Palmer v Roads & Traffic Authority [2002] NSWSC 34 …. 12.5 Palsgraf v Long Island Railroad Co, 162 NE 99 (1928) …. 5.6 Paltidis v The State Council of the Young Men’s Christian Association of Victoria Inc (2006) Aust Torts Reports 81-856; [2006] VSCA 122 …. 10.32, 10.50 Pantalone v Alaouie (1989) 18 NSWLR 119 …. 15.33 Papadopoulos v MC Labour Hire Services Pty Ltd (No 4) (2009) 24 VR 665 …. 8.38, 8.58, 8.59 Papathanasopoulos v Vacopoulos [2007] NSWCA 502 …. 18.35 Pargiter v Alexander (1995) 5 Tas R 158 …. 18.5, 19.27 Paris v Stepney Borough Council [1951] AC 367 …. 3.42, 3.77

Parkin v Australian Capital Territory Schools Authority [2005] ACTSC 3 …. 3.48 Parramatta City Council v Lutz (1988) 12 NSWLR 293 …. 7.37, 7.42, 7.43 Partridge v Government Insurance Office (NSWCA, Priestley, Meagher and Cole JJA, 9 October, 1995, unreported, BC9505468) …. 12.54 Pask v Owen [1987] 2 Qd R 421 …. 13.19, 13.39 Pasqualotto v Pasqualotto [2013] VSCA 21 …. 13.5 Pasqualotto v Pasqualotto (No 3) [2014] VSC 26 …. 10.19 Pasvouris v Schmarr (2007) 96 SASR 572 …. 12.80 Patterson v McGinlay (1991) 55 SASR 258 …. 3.60 Paul v Cooke [2013] NSWCA 311 …. 3.71, 4.3, 4.4, 4.19, 4.63 Payne v Dwyer (2013) 46 WAR 128 …. 18.20, 18.30 Peden Pty Ltd v Bortolazzo [2006] 2 Qd R 574 …. 15.41 Pelmothe v Phillips (1899) 20 LR (NSW) (L) 58 …. 15.23, 15.24, 15.25, 15.64, 15.65 Pemberton v Southwark London Borough Council [2000] 3 All ER 924 …. 15.32, 15.64 Pemberton v Southwark London Borough Council [2001] 1 WLR 538 …. 15.32, 15.64 Pene v Murphy [2004] WASCA 103 …. 12.41 Penfolds Wines Pty Ltd v Elliott (1946) 74 CLR 204 …. 18.6, 18.10, 18.15, 18.16, 18.21, 18.25, 18.26, 18.28, 18.38, 18.39 Pennington v Norris (1956) 96 CLR 10 …. 10.26, 10.27, 10.29, 10.32, 10.33, 10.49—10.51, 11.15 Penrith City Council v Parks [2004] NSWCA 201 …. 12.38, 12.103 Penrith Rugby League Club Ltd (t/as Cardiff Panthers) v Elliot [2009] NSWCA 247 …. 3.51 Penton v Calwell (1945) 70 CLR 219 …. 20.22 Perfect v MacDonald [2012] QSC 11 …. 12.60

Perisher Blue Pty Limited v Harris [2013] NSWCA 38 …. 4.9 Perisher Blue Pty Ltd v Nair-Smith (2015) 320 ALR 235; 90 NSWLR 1; 295 FLR 153; [2015] NSWCA 90 …. 4.14, 4.58, 4.64 Perochinsky v Kirscher [2013] NSWSC 400 …. 18.22 Perpetual Trustees & National Executors of Tasmania Ltd v Perkins (1989) Aust Torts Reports 80-295 …. 18.16, 18.27, 18.28, 18.34, 19.38 Perpetual Trustees Australia Ltd v Heperu Pty Ltd (2009) 76 NSWLR 195 …. 18.22 Perpetual Trustees Australia Ltd v Paladin Wholesale Funding Pty Ltd (2011) 193 FCR 300 …. 13.33 Perpetual Trustees Australia Ltd v Schmidt [2010] VSC 67 …. 19.16 Perre v Apand Pty Ltd (1997) 80 FCR 19 …. 8.34 Perre v Apand Pty Ltd (1998) 198 CLR 180; 164 ALR 606 …. 5.23–5.26, 5.31–5.33, 8.21, 8.29, 8.34–8.37, 8.40, 8.43, 8.58 Perrett v Sydney Harbour Foreshore Authority [2009] NSWSC 1026 …. 10.11 Perry v Australian Rail Track Corp Ltd [2013] NSWSC 714; (2013) 64 MVR 121 …. 13.33 Pervan v North Queensland Newspaper Co Ltd (1993) 178 CLR 309 …. 20.25 Phelps v London Borough of Hillingdon [2001] 2 AC 619; [2000] 4 All ER 504 …. 13.16, 13.40 Philips v William Whitely Ltd [1938] 1 All ER 566 …. 3.12 Phillis v Daly (1988) 15 NSWLR 65 …. 3.37, 3.66 Phoenix Society Inc v Cavenagh (1997) 25 MVR 143 …. 14.18 Pioneer Concrete (WA) Pty Ltd v Elwood [2005] WASCA 48 …. 15.15 Pioneer Mortgage Services Pty Ltd v Columbus Capital Pty Ltd [2016] FCAFC 78 …. 14.4, 14.19, 14.47 Piro v W Foster & Co Ltd (1943) 68 CLR 313 …. 13.33 Pitt Son & Badgery Ltd v Proulefco SA (1984) 153 CLR 644; 52 ALR

389 …. 6.15 Planet Fisheries Pty Ltd v La Rosa (1968) 119 CLR 118 …. 12.68, 12.69, 12.103 Platt v Nutt (1988) 12 NSWLR 231 …. 16.31, 16.32 Pledge v Roads and Traffic Authority (2004) 205 ALR 56 …. 4.35 Podmore v Aquatours Pty Ltd [1984] 1 NSWLR 111 …. 4.32 Podrebersek v Australian Iron & Steel Pty Ltd (1985) 59 ALR 529 …. 10.27, 10.29, 10.30, 10.33, 10.34, 10.43, 10.49—10.51 Polar Aviation Pty Ltd v Civil Aviation Safety Authority (No 4) (2012) 203 FCR 293 …. 13.35 Polemis and Furness, Withy & Co Ltd, Re [1921] 3 KB 560 …. 4.53, 4.54, 4.64 Police v Greaves [1964] NZLR 295 …. 16.19 Pollard v Baulderstone Hornibrook Engineering Pty Ltd (2008) Aust Torts Reports 81-949; [2008] NSWCA 99 …. 10.17, 10.19 Pollard v E I DuPont De Nemours Inc, 412 F 2d 657 (6th Cir, 2005) …. 9.15 Pollard v Trude [2008] QSC 119 …. 3.36, 3.77, 3.78 Pollard v Trude [2009] 2 Qd R 248 …. 3.77, 11.27 Port Stephens Shire Council v Tellamist Pty Ltd (2004) 135 LGERA 98; [2004] NSWCA 353 …. 19.39, 19.50 Potts v Frost [2012] TASFC 6; (2012) 22 Tas R 103 …. 12.24, 12.26 Powercor Australia Ltd v Thomas (2012) 43 VR 220 …. 12.99 Powney v Kerang and District Health(2014) 43 VR 506; [2015] Aust Torts Reports ¶82-192; [2014] VSCA 221 …. 4.21, 4.64 Pozgay v E J O’Connor & Sons Pty Ltd [2000] ACTSC 59 …. 12.75 PQ v Australian Red Cross Society [1992] 1 VR 19 …. 3.55 Precision Products (NSW) Pty Ltd v Hawkesbury City Council (2008) 74 NSWLR 102 …. 8.38, 8.58, 8.59 Prefumo v Bradley [2011] WASC 251 …. 20.31

Premier Group Pty Ltd v Followmont Transport Pty Ltd [2000] 2 Qd R 338 …. 18.36 Presidential Security Services of Australia Pty Ltd v Brilley (2008) 73 NSWLR 241; (2008) Aust Torts Reports 81-968 …. 19.9, 19.55, 19.56 Presser v Caldwell Estates Pty Ltd [1971] 2 NSWLR 471 …. 8.19, 8.20 Price v New South Wales [2011] NSWCA 341 …. 3.50 Price v Southern Cross Television (TNT9) Pty Ltd [2014] TASSC 70; (2015) Aust Torts Reports ¶82-208 …. 11.28 Prince Alfred College Inc v ADC (2016) 335 ALR 1 …. 2.11, 14.4, 14.19, 14.47, 14.48 Private Parking Services (Vic) Pty Ltd v Huggard (1996) Aust Torts Reports 81-397 …. 19.27, 19.44, 19.49, 19.50, 19.56 Progress and Properties Ltd v Craft (1976) 135 CLR 651; 12 ALR 59 …. 13.23 Project No 2 Pty Ltd v Cushway Blackford & Associates Pty Ltd [2011] QCA 102 …. 8.44, 8.58, 8.59 Propell National Valuers (WA) Pty Ltd v Australian Executor Trustees Ltd (2012) 202 FCR 158 …. 8.16, 8.21 Proprietors of Strata Plan No 13391 v Abate (NSWCA, Mahoney P, Handley and Cole JJA, 27 March 1996, unreported, BC9600790) …. 15.36 Proprietors of Strata Plan No 14198 v Cowell (1989) 24 NSWLR 478 …. 15.6, 15.36, 15.37 Proprietors of Strata Plan No 17226 v Drakulic (2002) 55 NSWLR 659 …. 6.22, 6.25, 6.26 Protective Commissioner v D (2004) 60 NSWLR 513 (NSWCA) …. 12.21 Proudman v Allen [1954] SASR 336 …. 19.2, 19.3, 19.55, 19.56 Przetak v Metropolitan (Perth) Passenger Transport Trust [1961] WAR 2 …. 15.50 Public Transport Commission of New South Wales v Perry (1977) 137

CLR 107; 14 ALR 273 …. 17.3, 19.18 Public Transport Corporation v Sartori [1997] 1 VR 168 …. 6.23 Public Trustee (ACT) v Thompson (2000) 155 FLR 18 (ACTSC) …. 12.21 Pullen v Gutteridge Haskins & Davey Pty Ltd [1993] 1 VR 27 …. 8.13 Pyrenees Shire Council v Day (1998) 192 CLR 330; 151 ALR 147 …. 5.22, 7.12, 7.14, 7.15, 7.21, 7.27, 7.33, 7.34, 7.37, 7.42–7.44, 8.35

Q Quality Roads Pty Ltd v Baw Baw Shire Council (Ruling No 1) [2016] VSC 477 …. 13.18 Queensland v Kelly [2015] 1 Qd R 577; [2014] QCA 27 …. 11.27, 11.51 Queensland v Nudd [2012] QCA 281 …. 4.33, 4.64 Queenstown Lakes District Council v Charterhall Trustees Ltd [2009] 3 NZLR 786 …. 8.48

R R Lowe Lippman Figdor & Franck v AGC (Advances) Ltd [1992] 2 VR 671 …. 8.27, 8.28, 8.53, 8.55 R v Cotesworth (1704) 6 Mod 172; 87 ER 928 …. 16.6, 16.10 R v Ireland [1998] AC 147 …. 16.18 R v Portelli (2004) 10 VR 259 …. 19.8 R (ex parte Lumba) v Secretary of State for the Home Department [2012] 1 AC 245 …. 19.24 Raciti v Hughes (1995) 7 BPR 14,837 …. 15.14, 15.64, 15.65 Radio 2UE Sydney Pty Ltd v Chesterton (2009) 238 CLR 460; 254 ALR 606 …. 20.6, 20.22, 20.37, 20.38 Radovanovic v Cutter [2004] ACTSC 9 …. 12.53 Rail Commissioner (formerly Transadelaide) v Warner [2011] SASCFC 90 …. 12.49

Rail Corp of New South Wales v Fluor Australia Pty Ltd [2009] NSWCA 344 …. 8.38, 8.58, 8.59 Raisin v Mitchell (1839) 9 C & P 613; 173 ER 979 …. 10.4 Ralevski v Dimovski (1987) 7 NSWLR 487 …. 12.75 Ramsay v Pigram (1968) 118 CLR 271; [1968] ALR 419 …. 14.4, 14.39 Randwick City Council v Muzic [2006] NSWCA 66 …. 10.32, 10.49, 10.50, 11.13, 11.50 Raper v Bowden (2016) 76 MVR 369 …. 13.3 Rapier v London Tramways Co [1893] 2 Ch 588 …. 15.21 Read v Croydon Corporation [1938] 4 All ER 631 …. 7.1, 13.18, 13.19 Redding v Lee (1983) 151 CLR 117; 47 ALR 241 …. 12.94, 12.95 Redzepovic v Western Health [2016] VSCA 251 …. 3.25 Reef Health Pty Ltd v Vines [2014] NSWSC 70 …. 19.29 Reeves v Commissioner of Police of the Metropolis [2000] 1 AC 360 …. 10.14 Regent Holdings Pty Ltd v Victoria [2013] VSC 601 …. 7.19, 7.21, 7.42 Register.com Inc v Verio Inc, 356 F 3d 393 (2d Cir, 2004) …. 18.7, 18.38 Reynolds v Aluma-Lite Products Pty Ltd [2010] QCA 224 …. 18.34, 19.37 Reynolds v Clarke (1726) 1 Str 634; 93 ER 747 …. 16.1 Reynolds v Katoomba RSL All Services Club Ltd (2001) 53 NSWLR 43 …. 8.35 Rhodes v Lake Macquarie City Council [2010] Aust Torts Reports 82073; [2010] NSWCA 235 …. 3.60, 3.62 Richards v Mills [2003] WASCA 97 …. 10.34, 10.49 Richards v Victoria [1969] VR 136 …. 6.4–6.6, 6.17, 6.25, 6.26 Richmond City Council v Scantelbury [1991] 2 VR 38 …. 15.36 Richtoll Pty Ltd v WW Lawyers Pty Ltd (in liq) [2016] NSWCA 308 …. 4.26, 4.28, 4.63

Rickard v Allianz Australia Insurance Ltd (2009) 54 MVR 214; [2009] NSWSC 1115 …. 7.36, 7.42 Rickards v Australian Telecommunications Commission [1983] 3 NSWLR 155 …. 15.43 Rickards v Lothian [1913] AC 263 …. 4.38, 4.42, 4.63 Rigby v Chief Constable of Northamptonshire [1985] 2 All ER 985 …. 19.4 Rixon v Star City Pty Ltd (2001) 53 NSWLR 98 …. 16.9, 16.17, 16.39, 16.40 Roads and Traffic Authority v Royal (2008) 245 ALR 653 …. 4.7, 4.14 Roads and Traffic Authority of New South Wales v Dederer (2007) 234 CLR 330; 238 ALR 761 …. 3.41, 3.42, 3.78, 5.15, 5.31, 5.32 Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd (2009) 168 LGERA 357; [2009] NSWCA 263 …. 3.36, 3.40, 3.57, 3.61, 3.77, 3.78, 7.18, 7.42, 7.43 Robbins v Skouboudis (2013) 63 MVR 307; [2013] QSC 101 …. 10.43 Roberts v Bass (2002) 212 CLR 1; 194 ALR 161 …. 20.22 Roberts v Eckert [2016] SASC 197 …. 18.26 Roberts v Rodier (2006) 12 BPR 23,453; [2006] NSWSC 282 …. 15.33 Robertson v Swincer (1989) 52 SASR 356 …. 6.7 Robins Dry Dock & Repair Co v Flint, 275 US 303; 48 S Ct 134 (1927) …. 8.50 Robinson v Kilvert (1889) 41 Ch D 88 …. 15.9 Robinson Helicopter Company Inc v McDermott (2016) 331 ALR 550; 90 ALJR 679; [2016] HCA 22 …. 4.24, 4.25, 5.15, 5.31, 5.32 Robson v Leischke (2008) 72 NSWLR 98 …. 15.21, 15.31, 15.64, 15.65 Roche v Kigetzis (2015) 72 MVR 67; [2015] VSCA 207 …. 10.31, 10.49 Roche Mining Pty Ltd v Jeffs [2011] NSWCA 184 …. 3.14, 3.80, 10.17 Rockdale City Council v Simmons (2015) 70 MVR 256; [2015] NSWCA 102 …. 10.32, 10.50, 11.27 Rodrigues v Ufton (1894) 20 VLR 539 …. 17.13

Roe v Minister of Health [1954] 2 QB 66 …. 3.28, 3.78, 3.79, 4.56 Rogers v Whitaker (1992) 175 CLR 479; 109 ALR 625 …. 2.5, 3.5, 3.13, 3.16, 3.17, 3.19, 3.23, 3.79, 3.80, 4.26 Roggenkamp v Bennett (1950) 80 CLR 292 …. 11.12 Rohra v Ox Two Pty Ltd (t/as Ocean Extreme) [2016] NSWDC 78 …. 11.31 Rolls Royce New Zealand Ltd v Carter Holt Harvey Ltd [2005] 1 NZLR 324 …. 8.48 Roman Catholic Church Trustees for the Diocese of Canberra and Goulburn v Hadba (2005) 221 CLR 161; 216 ALR 415 …. 3.47, 3.61, 3.77, 3.78 Romeo v Conservation Commission of the Northern Territory (1998) 192 CLR 431; 151 ALR 263 …. 3.46, 3.62, 3.63, 3.78, 5.23 Rootes v Shelton (1967) 116 CLR 383; [1968] ALR 33 …. 11.6, 11.50, 11.51 Rose v Ford [1937] AC 826 …. 12.81 Rosebanner Pty Ltd v Energy Australia [2011] NSWCA 28 …. 17.20 Rosecell Pty Ltd v JP Haines Plumbing Pty Ltd [2015] NSWSC 1238 …. 19.29 Rosecrance v Rosecrance (1995) 105 NTR 1 …. 12.11 Rosenberg v Percival (2001) 205 CLR 434; 178 ALR 577 …. 4.26, 4.29, 4.56, 4.64 Rosniak v Government Insurance Office (1997) 41 NSWLR 608 …. 12.54, 12.62 Rosstown Holdings Pty Ltd v Mallinson (2000) 2 VR 299 …. 12.11 Rothonis v Lattimore [2016] NSWSC 1409 …. 3.25, 3.80 Rowe v McCartney [1976] 2 NSWLR 72 …. 4.58, 4.63 Rowling v Takaro Properties Ltd [1988] AC 473 …. 7.34 Royal Dental Hospital of Melbourne v Akbulut [2002] VSCA 88 …. 12.49 RS v HS [2016] WADC 157 …. 9.17

Ruddock v Taylor (2003) 58 NSWLR 269 …. 4.2, 4.3, 4.34, 4.63, 4.64 Ruddock v Taylor (2005) 222 CLR 612; 221 ALR 32 …. 4.2, 16.24 Ruhan v Water Conservation and Irrigation Commission (1920) 20 SR (NSW) 439 …. 15.30 Russell v Edwards [2006] 65 NSWLR 373; (2006) Aust Torts Reports 81-833; [2006] NSWCA 19 …. 10.24, 10.46, 10.49, 10.50 Russell v Rail Infrastructure Corporation [2007] NSWSC 402 …. 10.14 Rust v Needham (1974) 9 SASR 510 …. 10.23 Ryan v Ann St Holdings Pty Ltd [2006] 2 Qd R 486 …. 14.20, 14.21, 14.47, 14.48 Ryan v Electricity Trust of South Australia (No 1) (1987) 47 SASR 220 …. 3.58 Rylands v Fletcher (1866) LR 1 Ex 265; (1868) LR 3 HL 330 …. 1.4, 14.29, 15.20, 15.21, 15.64

S SA de Remorquage Helice v Bennetts [1911] 1 KB 243 …. 8.30 Sadcas Pty Ltd v Business and Professional Finance Pty Ltd [2011] NSWCA 267 …. 18.18, 19.29 Safar v Sutherland Shire Council [2016] NSWDC 232 …. 11.28 Safari 4 × 4 Engineering Pty Ltd v Doncaster Motors Pty Ltd [2006] VSC 460 …. 18.29 Sahade v Bischoff [2015] NSWCA 418 …. 17.4 Samios v Repatriation Commission [1960] WAR 219 …. 14.29 San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979 (1986) 162 CLR 340; 68 ALR 161 …. 5.19, 8.16, 8.17, 8.26, 8.29, 8.52–8.55 Sands v South Australia [2013] SASC 44 …. 20.20 Saric v Tehan (2011) 33 VR 632 …. 12.101 Scanlon v American Cigarette Company (Overseas) Pty Ltd (No 3)

[1987] VR 289 …. 11.2, 11.36, 11.50 Schellenberg v Tunnel Holdings Pty Ltd (2000) 200 CLR 121; 170 ALR 594 …. 4.32 Schiliro v Peppercorn Child Care Centres Pty Ltd (No 2) [2001] 1 Qd R 518 …. 13.9, 13.16, 13.39, 13.40 Schiller v Gregory (1985) Aust Torts Reports 80-751 …. 3.33, 3.34 Schleter (t/as Cape Crawford Tourism) v Brazakka Pty Ltd (2002) 12 NTLR 76 …. 17.7 Scholz v Standish [1961] SASR 123 …. 3.10 Schuller v SJ Webb Nominees Pty Ltd [2015] SASCFS 162 …. 11.25, 11.27, 11.50, 11.51 Schultz v McCormack [2015] NSWCA 330 …. 11.27, 11.51 Scott v Davis (2000) 204 CLR 333; 175 ALR 217 …. 14.6, 14.13 Scott v Shepherd (1773) 2 Wm Bl 892; 96 ER 525 …. 16.1, 16.10 Sean Rose Holdings Pty Ltd v LWP Technologies Ltd [2016] QSC 16 …. 15.51 Seas Sapfor Forests Pty Ltd v Electricity Trust of South Australia (1996) 187 LSJS 369 …. 8.43, 8.58, 8.59 Secretary, Department of Health and Community Services (NT) v JWB (Marion’s Case) (1992) 175 CLR 218; 106 ALR 385 …. 16.9, 16.13, 16.39, 16.40 Secretary of State for the Home Department v Robb [1995] Fam 127 …. 19.2 Sedleigh-Denfield v O’Callaghan [1940] AC 880 …. 15.35, 15.36, 15.41, 15.42, 15.43 Seidler v Luna Park Reserve Trust (NSWSC, Hodgson J, 21 September 1995, unreported, BC9505507) …. 15.8, 15.31, 15.64, 15.65 Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 364; 120 ALR 16 …. 4.25 Serrao v Cornelius (No 2) [2016] NSWCA 231 …. 10.30 Settlement Group Pty Ltd v Purcell Partners [2013] VSCA 370 …. 4.17,

4.63 Shaddock & Associates Pty Ltd v Parramatta City Council (No 1) (1981) 150 CLR 225; 36 ALR 385 …. 7.1, 8.12, 8.15, 8.16, 8.25, 8.29, 8.52, 8.54 Sharman v Evans (1977) 138 CLR 563; 13 ALR 57 …. 2.12, 12.13, 12.15, 12.46, 12.53, 12.82 Sharp v Parramatta City Council [2015] NSWCA 260; (2015) 209 LGERA 220 …. 11.31 Shaw v Thomas [2010] NSWCA 169 …. 3.36, 3.41, 3.46, 3.60, 3.77 Shelley v Szelley [1971] SASR 430 …. 10.20 Shire of Brookton v Water Corporation (2003) 113 LGERA 119; [2003] WASCA 240 …. 13.20, 13.39, 13.40 Shirt v Wyong Shire Council [1978] 1 NSWLR 631 …. 5.16 Shoalhaven City Council v Pender [2013] NSWCA 210 …. 3.41, 4.33, 4.64 Shogunn Investments Pty Ltd v Public Transport Authority of Western Australia [2016] WASC 42 …. 15.16 Sibley v Kais (1967) 118 CLR 424; [1968] ALR 158 …. 3.32 Sibley v Milutinovic (1990) Aust Torts Reps 81-013 …. 16.12 Sibraa v Brown [2012] NSWCA 328 …. 3.66 Sidaway v Governors of the Bethlem Royal Hospital [1985] AC 871 …. 3.16 Sienkiewicz v Greif (UK) Ltd; Knowsley v Metropolitan Borough Council v Willmore [2011] UKSC 10; [2011] 2 All ER 857 …. 4.18, 4.19, 4.20, 4.21, 4.34, 4.64 Sim v Stretch [1936] 2 All ER 1237 …. 20.6, 20.37 Simmons v Rockdale City Council [2013] NSWSC 1431 …. 11.27, 11.50, 11.51 Simon v Condran [2013] NSWCA 388 …. 19.4 Sinclair v Haynes [2000] NSWSC 642 …. 19.32 Singh v Calvary Hospital ACT Inc (2008) 220 FLR 352 (ACTSC) ….

12.21 Six Carpenters’ Case, The (1610) 8 Co Rep 146a; 77 ER 695 …. 17.21 SJ Weir Ltd v Bijok (2011) 112 SASR 127 …. 15.22 Skelton v Collins (1966) 115 CLR 94; [1966] ALR 449 …. 12.46, 12.73, 12.74, 12.76, 12.77, 12.103 Slatyer v The Daily Telegraph Newspaper Co Ltd (1908) CLR 1 …. 20.6, 20.37 Slaveski (by his litigation guardian Slaveska) v State of Victoria [2010] VSC 441 …. 16.18, 16.39, 16.40, 18.5, 18.6, 18.38, 18.39, 19.23, 19.55, 19.56 Slivak v Lurgi (Australia) Pty Ltd (2001) 205 CLR 304; 177 ALR 585 …. 13.1, 13.5, 13.15, 13.25, 13.30, 13.39, 13.40 Smedley v Smedley [1984] Tas R 49 …. 10.23 Smith v ADVFN Plc [2008] EWHC 1797 …. 20.31 Smith v Charles Baker & Sons [1891] AC 325 …. 11.4–11.6 Smith v Dobson (1841) 3 Man & G 59; 133 ER 1057 …. 10.4 Smith v Jenkins (1970) 119 CLR 397 …. 11.45 Smith v Leurs (1945) 70 CLR 256 …. 6.16, 6.18, 6.25, 6.26 Smith v Littlewoods Organisation Ltd [1987] AC 241 …. 6.20–6.22, 6.26 Smith v Lucht [2016] QCA 267 …. 20.30, 20.31 Smith v Perese [2006] NSWSC 288 …. 11.27, 11.31 Smith v Randall (2016) 77 MVR 402; [2016] QSC 191 …. 10.44, 10.49, 10.50 Snap-on Business Solutions Inc v O’Neil & Associates Inc, 708 F Supp 2d 669 (ND Oh, 2010) …. 18.7, 18.38 Snyder v Phelps, 562 US 443 (2011), …. 9.15 Soblusky v Egan (1960) 103 CLR 215 …. 14.6 Solomons v Pallier (2015) 72 MVR 365; [2015] NSWCA 266 …. 10.44 Sotelo v DirectRevenue LLC, 384 F Supp 2d 1219 (ND Ill, 2005) ….

18.7, 18.38 South Australia v Lampard Trevorrow (2010) 106 SASR 331 …. 1.17, 16.25, 16.27 South Australia v Simionato (2005) 143 LGERA 128 …. 15.34 South Eastern Area Health Service v King [2006] NSWCA 2 …. 3.13 Southern Properties (WA) Pty Ltd v Executive Director of the Department of Conservatism and Land Management (2012) 42 WAR 287; 189 LGERA 359; [2012] WASCA 79 …. 3.60, 7.19, 7.42, 7.43, 14.4, 15.40, 15.64 Sovar v Henry Lane Pty Ltd (1967) 116 CLR 397 …. 13.10, 13.11, 13.14, 13.19, 13.39, 13.40 Spautz v Butterworth (1996) 41 NSWLR 1 …. 16.24, 19.21, 19.45, 19.55, 19.56 Spencer v Commonwealth (1907) 5 CLR 418 …. 19.39 Spencer v Silva [1942] SASR 213 …. 15.53 Sprinkler Warehouse Inc v Systematic Rain Inc, 880 NW 2d 16, 23 (Minn 2016) …. 18.25 SSYBA Pty Ltd v Lane [2013] WASC 445 …. 17.1 St Helen’s Smelting Co v Tipping (1865) 11 HLC 642; 11 ER 1483 …. 15.2, 15.17, 15.64, 15.65 St Mark’s Orthodox Coptic College v Abraham [2007] NSWCA 185 …. 3.48, 3.60, 6.7 Stanley v Powell [1891] 1 QB 86 …. 16.3, 16.28, 19.18 Stanton v Fell [2013] NSWSC 1001 …. 20.30 State Analysis Inc v American Financial Services Association, 621 F Supp 2d 309 (ED Va, 2009) …. 18.7, 18.38 State of Louisiana, ex rel Guste v M/V Testbank, 752 F 2d 1019 (5th Cir, 1985) …. 8.50 State Rail Authority of NSW v Wiegold (1991) 25 NSWLR 500 …. 4.39, 4.49, 4.50, 4.63 State Rail Authority of NSW v Yu-Mei Chu (2008) Aust Torts Reports

81-940 …. 4.56, 4.64 State Rubbish Collectors Association v Siliznoff, 240 P 2d 282 (Cal 1952) …. 9.15 Steen v Senton (2015) 11 ACTLR 95 …. 10.31, 10.49, 10.50 Stenning v Sanig [2015] NSWCA 214 …. 10.32, 10.50 Stephens v Giovenco [2011] NSWCA 53 …. 3.40, 3.77, 3.78, 4.58 Stephens v Myers (1830) 4 Car & P 349; 172 ER 735 …. 16.16, 16.18, 19.23 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16; 63 ALR 513 …. 5.19, 14.10, 14.12, 14.47 Stevenson Jordan & Harrison Ltd v Macdonald and Evans [1952] 1 TLR 101 …. 14.11 Stewart v Ackland [2015] ACTCA 1; (2015) 10 ACTLR 207; 293 FLR 341; [2015] Aust Torts Reports ¶82-210 …. 11.31 Stingel v Clark (2006) 226 CLR 442; 228 ALR 229 …. 16.30, 16.32 Stockwell v Victoria [2001] VSC 497 …. 15.31, 15.64 Stojan (No 9) Pty Ltd v Kenway [2009] NSWCA 364 …. 10.32, 10.50 Stoneman v Lyons [1974] VR 797 …. 17.10 Stoneman v Lyons (1975) 133 CLR 550; 8 ALR 173 …. 17.10 Stormer v Ingram (1978) 21 SASR 93 …. 15.53 Stovin v Wise [1996] AC 923 …. 7.2, 7.43 Strange Investments (WA) Pty Ltd v Coretrack Ltd [2014] WASC 281 …. 18.17 Stratienko v Cordis Corp, 429 F 3d 592 (6th Cir 2005) …. 18.25, 18.39 Street v Luna Park Sydney Pty Ltd (2009) 223 FLR 245 …. 8.29, 8.54 Streller v Albury City Council [2013] NSWCA 348 …. 11.31 Strong v Woolworths Ltd t/as Big W (2012) 246 CLR 182; 285 ALR 420 …. 2.7, 4.3, 4.5, 4.6, 4.11, 4.17, 4.19, 4.21, 4.22, 4.32, 4.33, 4.63, 4.64 Stuart v Kirkland-Veenstra (2009) 237 CLR 215; 254 ALR 432 …. 5.26,

5.31, 6.14, 6.26, 7.7, 7.16, 7.42, 7.43 Stubbings v Webb [1993] AC 498 …. 16.29, 16.30 Sturch v Willmott [1997] 2 Qd R 310 …. 12.27 Sturges v Bridgman (1879) 11 Ch D 852 …. 15.5, 15.6, 15.64 Sullivan v Gordon (1999) 47 NSWLR 319 …. 12.27, 12.28 Sullivan v Moody (2001) 207 CLR 562; 183 ALR 404 …. 2.8, 4.16, 5.23, 5.27, 5.28, 5.31–5.33, 8.34 Sungravure Pty Ltd v Meani (1964) 110 CLR 24 …. 10.16 Sutherland Shire Council v Heyman (1985) 157 CLR 424; 60 ALR 1 …. 5.19, 5.20, 5.21, 5.31, 7.11, 7.15, 7.21, 7.32, 7.33, 7.34, 7.35, 7.36, 7.37, 7.42, 7.43, 8.49 Swain v Waverley Municipal Corporation (2005) 220 CLR 517; 213 ALR 249 …. 3.63, 3.56 Swan Brewery Co Ltd v Shire of Belmont [1974] WAR 196 …. 15.59 Sweeney v Boylan Nominees Pty Ltd (t/as Quirks Refrigeration) (2006) 226 CLR 161; 227 ALR 46 …. 14.4, 14.5, 14.13, 15.21, 15.64, 15.65 Swift v Wearing-Smith [2016] NSWCA 38 …. 4.9, 4.64, 5.15, 5.31, 14.47 Swindells v Hosking [2012] QDC 6 …. 12.60 Sydney Refractive Surgery Centre Pty Ltd v Commissioner of Taxation (2008) 247 ALR 313 …. 12.41 Sydney South West Area Health Services v MD (2009) 260 ALR 702 …. 3.25, 3.79, 3.80 Symes v Mahon [1922] SASR 447 …. 16.22, 16.23, 16.39, 16.40, 19.19, 19.55, 19.56 Symons Nominees Pty Ltd v Roads and Traffic Authority of NSW (1997) Aust Torts Reports 81-413 …. 15.47 Szanto v Melville [2011] VSC 574 …. 20.31

T

T & X Co Pty Ltd v Chivas (2014) 67 MVR 297; [2014] NSWCA 235 …. 10.14, 10.31, 10.49, 10.50 Ta Ho Ma Pty Ltd v Allen (1999) 47 NSWLR 1 …. 8.28, 8.55 TAB Ltd v Beaman [2006] NSWCA 345 …. 6.11 Tabet v Gett (2010) 240 CLR 537; 265 ALR 227 …. 4.6, 4.14, 4.16, 4.21, 4.22, 4.24, 4.25, 4.63, 4.64, 12.53, 12.54 Tabet v Mansour [2007] NSWSC 36 …. 12.53 Takla v Nasr [2013] NSWCA 435 …. 4.6 Talbot-Price v Jacobs [2008] NSWCA 189 …. 3.15, 3.66 Tame v New South Wales; Annetts v Australian Stations Pty Ltd (2002) 211 CLR 317; 191 ALR 449 …. 3.36, 9.5, 9.6, 9.7, 9.8, 9.23 Tanwar Enterprises Pty Ltd v Bradshaw [2013] NSWSC 1276 …. 14.6 Taylor v City of Perth (1988) Aust Torts Reps 80- 191 …. 15.59 Taylor v Director of the Serious Fraud Office [1999] 2 AC 177 …. 20.20 TCN Channel Nine Pty Ltd v Anning (2002) 54 NSWLR 333 …. 17.17, 17.23, 17.24, 19.55, 19.56 Te Mata Properties Ltd v Hastings District Council [2009] 1 NZLR 460 …. 8.48 Tegg Corp v Beckstrom Electrical Co, 650 F Supp 2d 413 (WD Pa 2008) …. 18.25, 18.39 Telecom Vanuatu Ltd v Optus Networks Pty Ltd [2008] NSWSC 1209 …. 18.24 Telstra Corp Ltd v Bisley [2005] NSWCA 128 …. 3.40, 3.78 Telstra Corp Ltd v Smith (1998) Aust Torts Reports 81-487 …. 4.46 Tepko Pty Ltd v Water Board (2001) 206 CLR 1; 178 ALR 634 …. 8.11, 8.12, 8.16, 8.29, 8.52, 8.54 Terracon Consultants Western Inc v Mandalay Resort Group, 206 P 3d 81 (Nev, 2009) …. 8.50 Tesco Supermarkets Ltd v Nattrass [1972] AC 153 …. 19.50 Teubner v Humble (1963) 108 CLR 491 …. 12.11

Theilemann v Commonwealth [1982] VR 713 …. 3.58 Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104; 124 ALR 1 …. 20.14 Thomas v Kula [2001] WASCA 362 …. 12.27 Thomas v Powercor Australia Ltd (Damages Ruling) [2011] VSC 586 …. 19.27 Thomas v Quartermaine (1887) 18 QBD 685 …. 11.3 Thompson v Johnson and Johnson Pty Ltd [1991] 2 VR 449 …. 3.51, 3.77 Thompson v Woolworths (Qld) Pty Ltd (2005) 221 CLR 234; 214 ALR 452 …. 3.67 Thompson-Schwab v Costaki [1956] 1 All ER 652 …. 15.15 Thomson v STX Pan Ocean Co Ltd [2012] FCAFC 15 …. 19.28 Thorpe Nominees Pty Ltd v Henderson & Lahey [1988] 2 Qd R 216 …. 4.43 Thyroff v Nationwide Mutual Insurance Co, 864 NE 2d 1272 (NY, 2007) …. 18.23, 18.24, 18.25 TJX Companies Retail Securities Breach Litigation, Re, 527 F Supp 2d 209 (D Mass 2007) …. 18.25 TJX Companies Retail Securities Breach Litigation, Re, F 3d 489 (1st Cir 2009) …. 18.25 TNT Australia Pty Ltd v Christie (2003) 65 NSWLR 1 …. 14.28 Todorovic v Waller; Jetson v Hankin (1981) 150 CLR 402; 37 ALR 481 …. 12.1, 12.59, 12.60, 12.62, 12.63, 12.103 Tolhurst v Cleary Bros (Bombo) Pty Ltd [2008] NSWCA 181 …. 10.19 Toll Holdings Ltd v Stewart (2016) 338 ALR 602 …. 18.16 Toll Transport Pty Ltd (t/as Toll Customised Solutions) v National Union of Workers [2012] VSC 316 …. 15.31, 15.64, 15.65 Torette House Pty Ltd v Berkman (1939) 62 CLR 637 …. 15.35 Town of Port Hedland v Hodder (No 2) (2012) 294 ALR 315; 43 WAR 383 …. 3.7, 10.14, 10.37, 10.49—10.51

Townsend v O’Donnell [2016] NSWCA 288 …. 10.32 Toyota Finance Australia Ltd v Dennis (2002) 58 NSWLR 101 …. 19.11, 19.12, 19.13, 19.55, 19.56 Travel Compensation Fund v Tambree (2005) 224 CLR 627; 222 ALR 263 …. 4.35, 4.36, 4.64 Tremain v Pike [1969] 3 All ER 1303 …. 4.57 Trevorrow v State of South Australia (No 5) (2007) 98 SASR 136 …. 1.17 Trustees of the Roman Catholic Church for the Diocese of Bathurst v Koffman (1997) 143 ALR 49; (1996) Aust Torts Reports 81-399 …. 6.6, 6.25, 6.26 Tuberville v Savage (1669) 1 Mod 3; 86 ER 684 …. 16.19 Tucker v McCann (1948) VLR 222 …. 3.15 Tuncel v Renown Plate Co Pty Ltd [1976] VR 501 …. 12.94 Tuohey v Freemasons Hospital [2012] VSCA 80; (2012) 37 VR 180 …. 12.32 Tweed Shire Council v Allen [2009] NSWSC 1195 …. 8.40

U Ultramares Corporation v Touche (1931) 174 NE 441 …. 5.18, 5.32, 8.5 Underhill v Sherwell (NSWCA, Meagher, Sheller and Beazley JJA, 18 December 1997, unreported, BC9707083) …. 19.7 United States v Carroll Towing Co, 159 F 2d 169 (2nd Cir, 1947) …. 3.38 Uniting Church in Australia Property Trust (NSW) v Miller; Miller v Lithgow City Council (2015) 91 NSWLR 752; 212 LGERA 230; [2015] NSWCA 320 …. 4.9, 4.58, 4.63, 4.64, 6.6, 6.25, 6.26 University of Wollongong v Mitchell (2003) Aust Torts Reports 81-708; [2003] NSWCA 94 …. 3.66 Urbanski v Patel (1978) 84 DLR 650 …. 4.38

Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 …. 12.84, 19.49

V Vabu Pty Ltd v Federal Commissioner of Taxation (1996) 33 ATR 537 …. 14.12 Vairy v Wyong Shire Council (2005) 223 CLR 422; 221 ALR 711 …. 3.28, 3.39, 3.46, 3.63, 3.77, 3.78, 3.81, 4.9, 7.33, 7.42, 7.43 Valherie v Strata Corporation No 1841 Inc (2003) 86 SASR 245 …. 15.36, 15.57 Valherie v Strata Corporation No 1841 Inc [2004] SASC 170 …. 15.36, 15.57 Van der Wal v Harris [1961] WAR 124 …. 19.27 Van Gervan v Fenton (1992) 175 CLR 327; 109 ALR 283 …. 12.17, 12.18, 12.21, 12.27, 12.30, 12.103, 12.104 Various Claimants v Catholic Child Welfare Society [2013] 2 AC 1 …. 14.14 Vaughan v Benalla Shire (1891) 17 VLR 129 …. 15.30 Vaughan v Menlove (1837) 3 Bing (NC) 468; 132 ER 490 …. 3.2 Veljanovska v Verduci (2014) 42 VR 222 …. 13.5 Vella v Permanent Mortgages Pty Ltd [2008] NSWSC 505 …. 3.14, 3.22, 3.40, 3.77, 3.78 Venning v Chin (1974) 10 SASR 299 …. 16.34 Verryt v Schoupp (2015) 70 MVR 484; [2015] NSWCA 128 …. 10.13, 10.49, 10.50 Viasystems (Tyneside) Ltd v Thermal Transfer (Northern) Ltd [2006] QB 510 …. 14.14 Victoria v Bryar [1970] ALR 809; (1970) 44 ALJR 174 …. 6.5, 6.6, 6.7, 6.17, 6.25, 6.26 Victoria Park Racing & Recreation Grounds Co Ltd v Taylor (1937) 58 CLR 479 …. 15.12, 15.13, 15.64, 15.65

Victorian Commissioners v Coultas (1888) 13 App Cas 222 …. 9.1, 15.23 Villasevil v Pickering (2001) 24 WAR 167 …. 12.43 Viscardi v Hornsby Shire Council [2015] NSWDC 19 (trial); [2015] NSWCA 417; (2015) 214 LGERA 311 …. 11.27, 11.50 Vo v Tran [2016] NSWSC 1043; [2016] Aust Torts Reports ¶82-299 …. 11.27 Volman v Lobb [2005] NSWCA 348 …. 15.33, 15.61, 15.62 Von Lieven v Sherlock (NSWSC, Young J, 8 April 1987, unreported, BC8701449) …. 18.35 Voss v Suncorp-Metway Ltd (No 2) [2004] 1 Qd R 214 …. 19.16 Vreman v Albury City Council [2011] NSWSC 39 …. 11.31

W Waco Kwikform Ltd v Perigo [2014] NSWCA 140 …. 10.17 Wade Sawmill Pty Ltd v Colenden Pty Ltd [2007] QCA 455 …. 19.37 Wainwright v Home Office [2004] 2 AC 406 …. 9.18, 15.13, 15.64, 15.65 Walker v Corporation of the City of Adelaide (2004) 88 SASR 225 …. 15.41 Walker v Tugend (1981) 28 SASR 194 …. 12.7 Wallace v Kam (2013) 250 CLR 375; 297 ALR 383 …. 2.7, 3.16, 4.3, 4.4, 4.22, 4.26, 4.34, 4.56, 4.63, 4.64 Waller v James (2006) 226 CLR 136; 226 ALR 457 …. 5.25 Waller v James [2013] NSWSC 497 …. 12.63 Waller v James [2015] 90 NSWLR 634; NSWCA 232 …. 3.18, 3.79, 3.80, 4.56, 4.63, 4.64 Walsh v Ervin [1952] VLR 361 …. 15.60, 15.64, 15.65 Walter v Selfe (1851) De G & Sm 315; 64 ER 849 …. 15.9, 15.64, 15.65 Walter Fregon Pty Ltd v Sewell (VSC, Coldrey J, 20 November 1996,

unreported, BC9605901) …. 3.19 Ward v TE Hopkins & Son Ltd [1959] 3 All ER 225 …. 11.9 Warren v Lawton [2016] WASC 285 …. 17.13 Warren Shire Council v Kuehne (2012) 188 LGERA 362; [2012] NSWCA 81 …. 7.23, 7.27, 7.42, 7.43 Waterfall v Antony [2014] VSCA 44 …. 10.32, 10.49 Waterways Authority v Fitzgibbon (2005) 221 ALR 402 …. 3.56 Watson v Cowen [1959] Tas SR 194 …. 17.1 Watson v Meyer [2013] NSWCA 243 …. 11.31 Watt v Hertfordshire County Council [1954] 1 WLR 835 …. 3.60 Waugh v James K Allan Ltd [1964] SC (HL) 102 …. 3.10 Waugh v Kippen (1986) 160 CLR 156; 64 ALR 195 …. 13.25 Waverley Council v Ferreira (2005) Aust Torts Reports 81-818; [2005] NSWCA 418 …. 3.40, 3.60, 3.77, 3.78, 10.17, 11.27, 11.50, 11.51 WD & HO Wills (Australia) Ltd v State Rail Authority of New South Wales (1998) 43 NSWLR 338 …. 6.21, 6.22, 6.25, 6.26 Weaver v Ward (1616) Hob 134; 80 ER 284 …. 16.4 Websyte Corp Pty Ltd v Alexander (No 2) [2012] FCA 562 …. 18.7 Wege v Elphick (1947) 49 WALR 83 …. 12.50, 12.52 Wei Fan v South Eastern Sydney Local Health District (No 2) [2015] NSWSC 1235 …. 3.25 Weinert v Schmidt (2002) 84 SASR 307 …. 12.27 Wertheim v Cheel (1885) 11 VLR 107 …. 18.17 West v Peters (1976) 18 SASR 338 …. 16.34 Western Australia v Ward (2002) 213 CLR 1; 191 ALR 1 …. 17.16, 17.23 Western Districts Development Pty Ltd v Baulkham Hills Shire Council (2009) 75 NSWLR 706 …. 8.38, 8.40, 8.58, 8.59 Western Suburbs Hospital v Currie (1987) 9 NSWLR 511 …. 3.58, 3.62 Westpac Banking Corp v Bell Group Ltd (in liq) (No 3) (2012) 44

WAR 1 …. 19.50 Westrac Equipment Pty Ltd v King [2004] WASCA 188 …. 12.11 Wheeler v New Merton Board Mills Ltd [1933] 2 KB 669 …. 13.37 Wherry v KB Hutcherson Pty Ltd (1987) Aust Torts Reports 80-107 …. 15.8, 15.64 Whitbread v Rail Corporation New South Wales [2011] NSWCA 130 …. 19.48, 19.55, 19.56 White v Jameson (1874) LR 18 Eq 303 …. 15.41 White v Johnston (2015) 87 NSWLR 779 …. 16.13, 16.36, 16.39 White v Withers LLP [2009] EWCA Civ 1122 …. 18.5 Whittington v Smeaton [2016] ACTSC 76; (2016) Aust Torts Reports ¶82-277 …. 11.31 Wicks v State Rail Authority of New South Wales (2010) 241 CLR 60; 267 ALR 23 …. 9.7–9.10, 9.23 Wildman v Blakes (The Petersfield and the Judith Randolph) (1789) Burrell 332; 167 ER 596 …. 10.3 Wilkinson v Downton [1897] 2 QB 57 …. 9.1, 9.16, 9.17, 9.18 Wilkinson v Law Courts Ltd [2001] NSWCA 196 …. 4.14 Willett v Futcher (2005) 221 CLR 627; 221 ALR 16 …. 12.64, 12.65 William Holyman & Sons Pty Ltd v Marine Board of Launceston (1929) 24 Tas LR 64 …. 19.28 Williams v Milotin (1957) 97 CLR 465 …. 16.29, 16.30, 16.32 Wilsher v Essex Area Health Authority [1988] AC 1074 …. 4.23 Wilson v Ferguson [2015] WASC 15 …. 15.13 Wilson v Lombank Ltd [1963] 1 All ER 740 …. 18.9, 18.12, 18.38 Wilson v McDonald (2009) 193 A Crim R 63 …. 19.19, 19.55, 19.56 Wilson v New South Wales [2010] NSWCA 333 …. 17.17, 17.18, 17.23, 17.24 Wilson v New South Wales Land and Housing Corp [1998] ANZ Conv R 623 …. 15.25, 15.64, 15.65

Wilson v Nilepac Pty Ltd t/as Vision Personal Training (Crows Nest) [2011] NSWCA 63 …. 3.60 Wilson v Pringle [1987] QB 237 …. 16.7–16.9, 16.39, 16.40 Wilton v Commonwealth Trading Bank of Australia [1973] 2 NSWLR 644 …. 19.16 Wilton v Commonwealth Trading Bank of Australia [1974] 2 NSWLR 96 …. 19.16 Windley v Gazaland Pty Ltd t/as Gladstone Ten Pin Bowl [2014] QDC 124 …. 11.27, 11.50 Winkfield, The [1902] P 42 …. 18.14 Winky Pop Pty Ltd v Mobil Refining Australia Pty Ltd [2016] VSCA 187 …. 15.56 Winnipeg Condominium Corp No 36 v Bird Construction Co [1995] 1 SCR 85 …. 8.49 Withyman v New South Wales [2013] NSWCA 10 …. 14.33 Womack v Eldridge, 210 SE 2d 145 (1974) …. 9.15 Wong v Maroubra Automotive Refinishers Pty Ltd [2015] NSWSC 222 …. 19.38 Wong v Parkside Health NHS Trust [2001] EWCA Civ 1721 …. 9.18 Wood v Leadbitter (1845) 13 M & W 838; 153 ER 351 …. 17.18 Woodhead v Barrow (1993) Aust Torts Reps 81- 238 …. 12.31 Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460; 186 ALR 145 …. 3.14, 3.34, 3.52, 3.63, 3.79, 3.81 Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515; 205 ALR 522 …. 5.7, 5.26, 5.27, 5.31, 8.29, 8.36, 8.37, 8.38, 8.39, 8.40, 8.44, 8.58, 8.59 Woolworths Ltd v Grimshaw [2016] QCA 274 …. 3.46, 10.32 Wringe v Cohen [1940] 1 KB 229 …. 15.43 Wynbergen v Hoyts Corporation Pty Ltd (1997) 149 ALR 25 …. 10.27, 10.49, 10.50 Wynn v New South Wales Insurance Ministerial Corporation (1995)

184 CLR 485; 133 ALR 154 …. 12.35, 12.36, 12.45, 12.103 Wynn Tresidder Management Pty Ltd v Barkho [2009] NSWCA 149 …. 13.1, 13.3, 13.26, 13.39 Wyong Shire Council v Shirt (1980) 146 CLR 40; 29 ALR 217 …. 2.4, 3.30, 3.31, 3.33, 3.35–3.40, 3.44, 3.45, 3.61, 3.63, 3.77, 3.78, 5.15, 9.5, 13.24

X XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd (1985) 155 CLR 448; 57 ALR 639 …. 19.49, 19.50, 19.55, 19.56

Y Yakamia Dairy Pty Ltd v Wood [1976] WAR 57 …. 17.1 Yamaguchi v Phipps (2016) 77 MVR 1; [2016] QSC 151 …. 12.44 Yates v Jones (1990) Aust Torts Reports 81-009 …. 4.39, 4.49, 4.63, 4.65 Yates v Mobile Marine Repairs Pty Ltd [2007] NSWSC 1463 …. 14.37 York Bros (Trading) Pty Ltd v Commissioner of Main Roads [1983] 1 NSWLR 391 …. 15.45

Z Zakka v Elias [2013] NSWCA 119 …. 14.20 Zanner v Zanner (2010) 79 NSWLR 702; [2010] NSWCA 343 …. 3.7, 4.2, 4.9, 4.17, 4.21, 4.35, 4.51, 4.63, 4.64, 10.33, 10.50 Zhang v Golden Eagle International Trading Pty Ltd (2006) 45 MVR 365; [2006] NSWCA 25 …. 12.43 Zheng v Cai (2009) 239 CLR 1; 261 ALR 481 …. 12.87, 12.88 Zogiannis v Stevens [2012] VSC 264 …. 19.27 Zorom Enterprises Pty Ltd v Zabow (2007) 71 NSWLR 354 …. 12.43, 14.21, 14.33 Zuijs v Wirth Bros Pty Ltd (1955) 93 CLR 561 …. 14.10

Table of Statutes and Regulations References are to paragraphs Commonwealth Acts Interpretation Act 1901 s 15AB .… 13.11 Australian Consumer Law .… 1.19, 1.23, 1.24, 11.34 Ch 2 .… 13.6 Ch 3 .… 13.6 Pt 3.5 .… 1.23 s 7(1) .… 1.23 s 9(1) .… 1.23 s 18 .… 8.8 s 64 .… 11.32 s 142(c) .… 1.23 s 236 .… 12.32, 13.6 Cheques Act 1986 s 95(1) .… 18.22 Civil Aviation Act 1988 s 3 .… 17.9 Civil Aviation (Damage by Aircraft) Act 1958 .… 17.9 Civil Aviation Safety Regulations 1998 Pt 101 .… 17.8 Commonwealth Volunteers Protection Act 2003 .… 11.48 s 6(1) .… 11.48

s 6(2)(a) .… 11.48 s 6(2)(b) .… 11.48 s 6(3) .… 11.48 s 6(4) .… 11.48 Competition and Consumer Act 2010 .… 12.55 Pt VIB, Div 4 .… 12.66, 12.86 s 87D .… 12.83 s 87L .… 12.86 s 87M .… 12.86 s 87P .… 12.86 s 87P(2) .… 12.69 s 87Q .… 12.86 s 87R .… 12.86 s 87S .… 12.86 s 87T .… 12.69 s 87T(2) .… 12.69 s 87U .… 12.32, 12.66 s 87U(c) .… 12.55 s 87V .… 12.32 s 87W(2) .… 12.66 s 87W(2)(d) .… 12.66 s 87W(2)(e) .… 12.66 s 87W(4) .… 12.66 s 87W(5) .… 12.66 s 87Y.… 12.66 s 139A .… 11.32 s 139A(2) .… 11.32 s 139A(4) .… 11.34 s 139A(5) .… 11.34

Sch 2 .… 1.23, 12.32 Corporations Act 2001 s 601AG .… 5.16 Corporations Law …. 3.7 Damage by Aircraft Act 1999 .… 17.9 s 4 .… 17.9 Health and Other Services (Compensation) Act 1995 .… 12.30, 12.93, 12.103 s 8 .… 12.30, 12.93 s 28 .… 12.93 Income Tax Assessment Act 1997 .… 12.6 s 6-5 .… 12.41 Insurance Contracts Act 1984 s 66 .… 14.25 s 66(b) .… 14.25 Migration Act 1958 s 4AA(1) .… 13.12 National Disability Insurance Scheme Act 2013 …. 1.10, 1.11 s 11 .… 1.11 s 24 .… 1.11 s 25 .… 1.11 s 209 .… 1.11 National Disability Insurance Scheme (Supports for Participants – Accounting for Compensation) Rules 2013 r 1.1 .… 1.11 Sch 1 .… 1.11 Navigation Act 1912–53 …. 13.21 Navigation (Loading and Unloading) Regulations .… 13.21 Safety, Rehabilitation and Compensation Act 1988 .… 1.14

Seafarers Rehabilitation and Compensation Act 1992 .… 1.14 Social Security Act 1991 Pt 3.14 .… 12.93 Pt 3.14, Div 4, Subdiv C .… 12.93 s 1166 .… 12.93 s 1178 .… 12.93 Superannuation Act 1922 s 4(5) .… 13.12 Superannuation Act 1976 s 11(1) .… 13.12 Taxation Laws Amendment (Structured Settlements and Structured Orders) Act 2002 .… 12.6 Trade Practices Act 1974 .… 1.19, 11.32, 11.35 Pt VA .… 1.23, 2.13 Pt VIB .… 1.20, 1.23 s 52 .… 8.8 s 74A(4) .… 1.23 s 74AD .… 1.23 s 75AB .… 1.23 s 75AC .… 1.23, 4.16 s 75AC(2) .… 1.23 s 75AC(1) .… 1.23 s 75AC(2) .… 1.23 s 75AC(2)(d) .… 1.23 s 75AK .… 1.23 s 75AK(1)(c) .… 1.23 s 82(1) .… 13.6 Australian Capital Territory

Civil Law (Wrongs) Act 2002 …. 2.14, 3.32, 4.19, 4.34, 4.60 Ch 7A .… 14.41, 15.42 Ch 9 .… 20.3 Pt 3.3 .… 11.46 s 5 .… 11.47 s 5(1) .… 11.48 s 5(2)(a) .… 11.47, 11.48 s 5(2)(b) .… 11.48 ss 6–11 .… 11.48 s 8(1) .… 11.48 s 8(2)(a) .… 11.48 s 8(2)(b) .… 11.48 s 8(2)(c) .… 11.48 s 8(2)(d) .… 11.48 ss 11A–11B .… 11.46 ss 12–14 .… 3.74 s 14(c) .… 3.75 s 19 .… 13.35 ss 20–21 .… 14.37 s 24 .… 1.21 s 27 .… 10.35 s 32 .… 9.6 s 34(1) .… 4.60, 9.6 s 34(2) .… 9.7 s 34(3) .… 4.60, 9.13 s 34(4) .… 9.7 s 35 .… 9.6 s 35(2) .… 4.60, 9.12, 9.14 s 36(1) .… 9.11

ss 37–38 .… 11.46 s 41(1) .… 13.3, 15.40 s 41(2) .… 2.14 s 43(1) .… 3.35 s 43(2) .… 3.40 s 44(a) .… 3.45 s 44(b) .… 3.45 s 44(c) .… 3.59 s 45(1) .…4.2, 4.34 s 45(2) .… 4.19 s 45(3) .… 4.34 s 46 .… 4.10 s 47 .… 10.28 s 87 .… 3.22 s 93(1) .… 10.40, 13.2 s 94(1) .… 11.42 s 94(1)(a) .… 11.42 s 94(1)(b) .… 11.42 s 94(2) .… 11.42 s 95 .… 10.40 s 95(1) .… 10.40, 10.47 s 95(2)(a) .… 10.47 s 95(2)(b) .… 10.47 s 95(3) .… 10.40, 10.47 s 96 .… 10.44 s 96(1) .… 10.47, 11.11 s 96(2) .… 10.47 s 96(3) .… 10.47

s 96(5) .… 10.44, 10.47, 11.11 s 97 .… 10.23 s 98 .… 12.32 s 98(1) .… 12.32 s 98(2) .… 12.32, 12.66 s 99(1) .… 12.69 s 99(2) .… 12.69 s 100 .… 12.28, 12.48 s 101 .… 10.9, 13.34, 15.49 s 102 .… 10.6, 10.25 s 102(2) .… 13.34 s 107B(2)(a) …. 13.36 s 107E(1) .… 14.44 s 107F(2)(a) .… 13.36 s 107F(2)(b) .… 14.43 s 109 .… 7.17 s 110 .… 7.17 s 110(b) .… 7.36 s 110(c) .… 7.36 s 111 .… 13.27 s 112 .… 7.26, 7.42 s 113 .… 7.39 s 114 .… 7.21 s 116 .… 20.21 s 118(2) .… 20.3 s 119 .… 20.4 s 121 .… 20.12 s 121(2) .… 20.12 s 121(5) .… 20.12

s 122 .… 7.43, 20.11 s 124 .… 19.20 s 127 .… 19.20 s 133 .… 20.9 s 135 .… 20.16, 20.37, 20.38 s 136 .… 20.17, 20.37, 20.38 s 137 .… 20.19 s 137(2)(a) .… 20.19 s 137(2)(b) .… 20.19 s 138(1) .… 20.28 s 138(3) .… 20.28 s 138(4) .… 20.28 s 139.… 20.29 s 139(4) .… 20.29 s 139A(1) .… 20.23 s 139A(2) .… 20.23 s 139A(3) .… 20.23 s 139B(1) .… 20.26, 20.37 s 139B(4)(a) .… 20.26, 20.37 s 139B(4)(b) .… 20.26, 20.37 s 139B(4)(c) .… 20.26 s 139B(5) .… 20.26 s 139C(1) .… 20.10 s 139C(2) .… 20.10 s 139C(3)(a) .… 20.10 s 139C(3)(e) .… 20.10 s 139C(3)(f)(ii) .… 20.10 s 139C(3)(g) .… 20.10

s 139D .… 20.30 s 141 .… 19.20 s 142(2) .… 19.42 s 142(3) .… 19.42 s 168 .… 3.65 Justice and Community Safety Legislation Amendment Act 2006 s 2.62 .… 12.6 Lifetime Care and Support (Catastrophic Injuries) Act 2014 …. 1.12, 1.13, 1.18 Residential Tenancies Act 1997 s 37 .… 19.11 Supreme Court Act 1933 s 26 .… 15.54 Victims of Crime (Financial Assistance) Act 1983 .… 1.15, 1.18 s 51 .… 1.18 Work Health and Safety Act 2012 s 267(a) .… 13.7 s 267(c) .… 13.7 Workers Compensation Act 1951 .… 1.14, 1.18 s 184 .… 1.18 New South Wales Casino Control Act 1992 .… 16.9 Civil Liability Act 2002 .… 2.1, 2.10, 2.14, 3.18, 3.25, 3.41, 3.37, 4.3, 4.7, 4.8, 4.14, 4.19, 4.24, 4.56, 4.60, 6.9, 10.11, 10.31—10.33, 10.37, 10.40, 10.41, 10.46, 10.49, 10.50, 11.2, 11.27, 11.35, 11.37, 13.40, 19.55 Pt 1A, Div 4 .… 11.26 Pt 2A .… 3.50 s 3 .… 12.83

s 3B .… 2.14 s 3B(1) .… 9.19 s 3B(1)(a) .… 14.21, 14.33, 16.36, 19.26 s 5A .… 13.3, 13.22 s 5A(2) .… 15.40 s 5B .… 3.36, 3.32, 3.57, 10.31 s 5B(1) .… 3.35–3.57 s 5B(1)(b) .… 3.36 s 5B(2) .… 3.36, 3.40, 3.60, 10.31 s 5B(2)(d) .… 3.40 s 5C(a) .… 3.45 s 5C(b) .… 3.45 s 5C(c) .… 3.59 ss 5D-5E .… 4.2 s 5D .… 4.2, 4.3, 4.17, 4.21, 4.22, 4.26, 4.51, 4.56 s 5D(1) .…4.2, 4.3, 4.8, 4.17, 4.21, 4.34 s 5D(1)(a) .… 4.3, 4.4, 4.21 s 5D(1)(b) .… 4.3, 4.4 s 5D(2) .… 4.4, 4.19, 4.21, 4.22 s 5D(3) .… 4.26, 4.28 s 5D(3)(a) .… 4.26 s 5D(4) .… 4.3, 4.34 s 5E .… 4.3, 4.10 ss 5F–5H .… 11.22 s 5F .… 11.26, 11.27, 11.31 s 5F(1) .… 11.26, 11.27 s 5G .… 11.26, 11.27 s 5G(1) .… 11.26

s 5H .… 11.26, 11.27, 11.28 s 5H(1) .… 11.28 s 5I .… 3.71 ss 5J-5M .… 11.29 s 5J(1) .… 11.35 s 5K .… 11.29, 11.32, 11.35 s 5L .… 11.31 s 5M .… 11.30, 11.31 s 5N .… 11.31, 11.32, 11.35, 11.37, 11.51 s 5N(6) .… 11.33 s 5O .… 3.14, 3.22, 3.25 s 5O(1) .… 3.22 s 5O(2) .… 3.22 s 5P .… 3.17 s 5Q .… 13.22, 14.47 s 5Q(1) .… 14.33 s 5Q(2) .… 14.33 s 5R .… 10.11, 10.13, 10.14, 10.19, 10.30, 10.31, 10.37, 10.46 s 5R(2) .… 10.13, 10.14 s 5S .… 10.28, 10.33, 10.37 s 5T .… 10.35 s 11A(1) .… 13.2 s 11A(2) .… 13.2 s 12(1)(c) .… 12.55 s 12(2) .… 12.32, 12.66 s 12(3) .… 12.32 s 13 .… 12.38 s 14 .… 12.66 s 14(1) .… 12.63

s 14(2)(a) .… 12.60 s 14(2)(b) .… 12.60 s 15(1) .… 12.26 s 15(2) .… 12.22, 12.66 s 15(3) .… 12.22, 12.66 s 15(4) .… 12.22, 12.66 s 15(5) .… 12.22, 12.66 s 15B .… 12.28, 12.48 s 15C .… 12.44 s 16 .… 12.69, 12.76, 12.86 s 16(1) .… 12.71, 12.86, 19.25 s 16(2) .… 12.86 s 17 .… 12.86 s 17A .… 12.69, 12.76 s 17A(2) .… 12.69 s 18(1)(b) .… 12.19 s 21 .… 12.85, 12.86, 19.47, 19.53 ss 22–26 .… 12.6 s 22 .… 12.6 s 23(1) .… 12.6 s 23(2) .… 12.6 s 26 .… 12.6 s 27 .… 9.6 s 30(1) .… 9.9 s 30(2) .… 9.9 s 30(5) .… 9.9 s 31 .… 9.6, 9.12 s 32 .… 9.7

s 32(1) .… 4.60, 9.6 s 32(2) .… 9.7 s 32(2)(a) .… 9.7 s 32(3) .… 4.60, 9.13 s 32(4) .… 9.7 s 33 .… 4.60, 9.6, 9.14 ss 34–39 .… 14.41, 15.42 s 34(1)(a) .… 13.36 s 34A(1)(b) .… 14.44 s 35(1)(b) .… 15.42 s 35(3)(b) .… 14.43 s 41 .… 7.17, 7.26 s 42 .… 7.17, 7.18, 7.20 s 42(b) .… 7.36 s 42(c) .… 7.36 s 43 .… 7.23, 13.27 s 43A .… 4.26, 7.8, 7.9, 7.22–7.25, 7.27, 7.29, 7.36, 7.39, 7.42, 7.43 s 43A(2) .… 7.22 s 43A(3) .… 7.22, 7.23, 7.25 s 44 .… 3.46, 7.26, 7.27, 7.42–7.44 s 45 .… 7.39 s 46 .… 7.21 s 48 .… 10.40 s 49 .… 10.43 s 49(1)(a) .… 3.70, 10.47 s 49(1)(b) .… 10.47 s 49(1)(c) .… 3.70, 10.47 s 50 .… 10.24, 10.40, 10.46 s 50(1) .… 3.79, 10.40, 10.46, 10.49, 10.50

s 50(2) .… 10.46, 10.47, 10.50 s 50(3) .… 10.46, 10.47, 10.50 s 50(4) .… 10.46, 10.47 s 50(5) .… 10.46, 10.47 ss 52–53 .… 11.42 s 52 .… 19.9, 19.13, 19.55, 19.56 s 52(2)(c) .… 19.13 s 53 .… 19.9 s 53(2)(b) .… 19.9 s 54(1) .… 11.42 s 54(1)(a) .… 11.42 s 54(1)(b) .… 11.42 s 54(2) .… 11.42, 11.50, 11.51 s 54(3) .… 11.42 s 54(5) .… 11.42 s 54A .… 4.50, 11.42 ss 55–58 .… 11.47 s 56 .… 11.48 s 58(1) .… 11.47, 11.48 s 58(2)(a) .… 11.48 s 58(2)(b) .… 11.48 s 58(3) .… 11.47, 11.48 ss 58A–58C .… 11.46 ss 59–66 .… 11.48 s 59(1) .… 11.48 s 60(1) .… 11.48 s 61(b) .… 11.48 s 62 .… 11.48

s 63 .… 11.48 s 64 .… 11.48 s 65 .… 11.48 s 66 .… 11.48 ss 67–69 .… 3.74 s 69(2) .… 3.75 s 70 .… 12.3 s 71 .… 12.3 s 71(2) .… 12.3 s 72 .… 17.9 s 317B .… 7.37 Civil Liability Amendment (Offender Damages Trust Fund) Act 2005 . … 3.50 Community Protection Act 1994 …. 16.24 Companion Animals Act 1998 s 25 .… 19.4 Compensation to Relatives Act 1897 s 3(1) .… 1.21 Conveyancing Act 1919 s 177(8) .… 15.22 Crimes Act 1900 s 357F .… 17.18 Damage by Aircraft Act 1952 s 2(1) .… 17.9 Dangerous Goods Regulation 1978 .… 13.17 reg 18 .… 13.15, 13.17 reg 18(e) .… 13.15 reg 19 .… 13.15, 13.17 reg 19(e) .… 13.15

reg 19(g) .… 13.15 Defamation Act 1974 …. 20.17 s 15 .… 20.17 s 16 .… 20.17 Defamation Act 2005 …. 20.3, 20.17 Sch 1 .… 20.21 s 4 .… 20.21 s 6(2) .… 20.3 s 7 .… 20.4 s 8 .… 20.17 s 9 .… 20.11, 20.12 s 9(2) .… 20.12 s 9(5) .… 20.12 s 10 .… 20.11 s 16 .… 20.17 s 21(1) .… 20.4, 20.37 s 21(3)(b) .… 20.4 s 23 .… 20.9 s 25 .… 20.16, 20.37, 20.38 s 26 .… 20.17, 20.37, 20.38 s 27 .… 20.19 s 27(2)(a) .… 20.19 s 27(2)(b) .… 20.19 s 27(2)(d) .… 20.21 s 28(1) .… 20.28 s 28(3) .… 20.28 s 28(4) .… 20.28 s 29.… 20.29 s 29(4) .… 20.29

s 30(1) .… 20.23 s 30(2) .… 20.23 s 30(3) .… 20.23 s 31(1) .… 20.26, 20.37 s 31(4)(a) .… 20.26, 20.37 s 31(4)(b) .… 20.26, 20.37 s 31(4)(c) .… 20.26 s 31(5) .… 20.26 s 32(1) .… 20.10 s 32(2) .… 20.10 s 32(3)(a) .… 20.10 s 32(3)(e) .… 20.10 s 32(3)(f)(ii) .… 20.10 s 33.… 20.30 Drugs Misuse and Trafficking Act 1985 Pt 2A .… 11.46 s 36P .… 11.46 Electricity Supply Act 1995 .… 17.20 Employees Liability Act 1991 s 3 .… 14.24 Fair Trading Act 1987 .… 4.35 Landlord and Tenant Act 1899 s 8 .… 19.41 Law Reform (Miscellaneous Provisions) Act 1946 s 5 .… 13.35, 14.37 Law Reform (Miscellaneous Provisions) Act 1965 s 8 .… 10.9, 13.33, 15.49 s 9 .… 10.6, 10.25

s 9(1)(b) .… 10.14 Law Reform (Vicarious Liability) Act 1983 s 7 .… 13.22 Limitation Act 1969 s 18A .… 15.27 Local Government Act 1993 s 733 .… 15.48 s 733(1) .… 15.48 s 733(1)(b) .… 15.48 Luna Park Site Act 1990 s 19A(2) .… 15.8 s 19A(3) .… 15.8 s 19A(5) .… 15.8 Main Roads Act 1924 s 25 .… 15.45 Mental Health Act 1990 …. 6.22 s 20 .… 6.22, 7.16 s 24 .… 19.14 Mental Health Act 2007 s 22 .… 19.14 Motor Accidents Act 1988 s 74 .… 10.36 s 74(2)(b) .… 10.36 Motor Accidents Compensation Act 1999 .… 1.13 Pt 1.2 .… 10.29 Pt 1.2, Div 2 .… 1.18 s 7J(1) .… 1.18 s 7K .… 1.18 s 15A .… 11.46

s 125(2) .… 1.18 s 126 .… 12.38 s 127 .… 1.18 s 131 .… 1.18 s 134 .… 1.18 s 138 .… 10.36, 10.37 s 138(2) .… 10.14 s 138(2)(a) .… 10.38, 10.47 s 138(2)(b) .… 10.14, 10.43, 10.47 s 138(2)(c) .… 10.14, 10.23 s 138(2)(d) .… 10.14, 10.23 s 138(3) .… 10.30, 10.43, 10.47 s 140 .… 11.11 s 141A .… 1.18 s 141B .… 1.18 s 143 .… 12.6 Motor Accidents Compensation Amendment Act 1999 .… 1.13 Motor Accidents Compensation Amendment Act 2006 .… 1.13 Motor Accidents (Lifetime Care and Support) Act 2006 .… 1.13 s 58 .… 1.18 Motor Vehicle Sports (Public Safety) Act 1985 s 6(b) .… 13.31 s 8(1) .… 13.31 Public Health Isolation Act 2017 …. 7.41 s 4 .… 7.41–7.43 s 5 .… 7.41–7.43 Residential Tenancies Act 2010 s 120 .… 19.11

Scaffolding and Lifts Act 1912 .… 13.23 Scaffolding and Lifts Ordinance 1957 …. 13.31 Scaffolding and Lifts Regulations 1912 .… 13.31 reg 31(b) .… 13.9 Sporting Injuries Insurance Act 1978 .… 1.18 s 35A .… 1.18 Supreme Court Act 1970 s 68 .… 15.48, 15.54 Threatened Species Conservation Act 1995 …. 15.55 Trees (Disputes Between Neighbours) Act 2006 …. 15.6 Pt 2 .… 15.38 s 5 .… 15.38 s 9 .… 15.38 Victims Rights and Support Act 2013 .… 1.15, 1.18 s 102 .… 1.18 Work Health and Safety Act 2011 s 267(a) .… 13.7, 13.33 s 267(c) .… 13.7 Workers Compensation Act 1987 .… 1.14, 1.18 s 65(1) .… 1.18 s 151 .… 1.18 s 151G(1) .… 1.18 s 151H(1) .… 1.18 s 151I .… 1.18 s 151J(2)(b) .… 1.18 s 151N(3) .… 13.33 s 151O .… 11.8 Workplace Injury Management and Workers Compensation Act 1998 . … 1.14, 1.18

Northern Territory Compensation (Fatal Injuries) Act 1974 s 7 .… 1.21 Defamation Act 2006 …. 20.3 s 3 .… 20.21 s 5(2) .… 20.3 s 6 .… 20.4 s 8 .… 20.12 s 8(2) .… 20.12 s 8(5) .… 20.12 s 9 .… 20.11 s 20 .… 20.9 s 22 .… 20.16, 20.37, 20.38 s 23 .… 20.16, 20.37, 20.38 s 24 .… 20.17, 20.19 s 24(2)(a) .… 20.19 s 24(2)(b) .… 20.19 s 24(2)(d) .… 20.21 s 25(1) .… 20.28 s 25(3) .… 20.28 s 25(4) .… 20.28 s 26.… 20.29 s 26(4) .… 20.29 s 27(1) .… 20.23 s 27(2) .… 20.23 s 27(3) .… 20.23 s 28(1) .… 20.26, 20.37 s 28(4)(a) .… 20.26, 20.37 s 28(4)(b) .… 20.26, 20.37

s 28(4)(c) .… 20.26 s 28(5) .… 20.26 s 29(1) .… 20.10 s 29(2) .… 20.10 s 29(3)(a) .… 20.10 s 29(3)(e) .… 20.10 s 29(3)(f)(ii) .… 20.10 s 29(3)(g) .… 20.10 s 30.… 20.30 Juries Act s 6A .… 20.4, 20.37 Law Reform (Miscellaneous Provisions) Act 1956 s 12 .… 13.35, 14.37 s 13 .… 14.37 s 15 .… 15.49 s 15(1) .… 10.9, 13.33 s 16 .… 10.6 s 16(1) .… 10.25 s 22A .… 14.24 s 25 .… 9.6 s 25(1) .… 9.11 Liquor Ordinance s 79 .… 13.12 Motor Accidents (Compensation) Act 1979 .… 1.13, 1.18 s 5 .… 1.18 s 7(3) .… 1.18 s 18A .… 12.25 s 18B .… 12.25

Personal Injuries (Civil Claims) Act 2003 …. 2.14 s 12 .… 12.6 Personal Injuries (Liabilities and Damages) Act 2003 …. 2.14 s 3 .… 10.40 s 4 .… 2.14 s 4(1) .… 13.2 s 7 .… 11.48 s 7(1) .… 11.48 s 7(2)(a) .… 11.48 s 7(2)(b) .… 11.48 s 7(3)(b) .… 11.48 s 7(6) .… 11.48 s 7A .… 11.46 s 8 .… 11.47 s 8(1) .… 11.48 s 8(2) .… 11.48 s 8(3) .… 11.48 s 9 .… 11.42 s 9(1) .… 11.42, 11.50 s 10(1) .… 11.42 s 10(1)(a) .… 11.42 s 10(1)(b) .… 11.42 s 10(2) .… 11.42 ss 11–13 .… 3.74 s 13 .… 3.75 s 14(1) .… 10.40, 10.47 s 14(2) .… 10.40, 10.47 s 15 .… 10.44 s 15(1) .… 10.47

s 15(2) .… 10.47 s 16 .… 10.40 s 17 .… 10.40, 10.44, 10.47 s 18 .… 12.26, 12.32 s 19 .… 12.85, 19.46, 19.52 s 20 .… 12.32, 12.66 s 20(c) .… 12.55 s 21 .… 12.38 s 22 .… 12.66 s 22(1) .… 12.63 s 22(2)(a) .… 12.60 s 22(2)(b) .… 12.60 s 23 .… 12.26 s 23(1) .… 12.22, 12.66 s 23(2) .… 12.22, 12.66 s 23(3) .… 12.22, 12.66 s 23(4) .… 12.22, 12.66 s 23(5) .… 12.66 s 24 .… 12.69 s 26 .… 12.69 s 27 .… 12.69 s 27(2) .… 12.71, 19.25 s 29(b) .… 12.19 ss 31–32 .… 12.6 s 31(a) .… 12.6 s 31(b) .… 12.6 s 32 .… 12.6 Proportionate Liability Act 2005

Pt 2 .… 14.41, 15.42 s 4(2)(a) .… 13.36 s 7 .… 14.44 s 13(2)(b) .… 14.43 Residential Tenancies Act 1999 Pt 9 .… 19.11 Return to Work Act 2016 …. 1.18 s 52(1) .… 1.18 Supreme Court Act 1979 s 14(1)(b) .… 15.54 Victims of Crime (Assistance) Act 2006 .… 1.15, 1.18 s 62 .… 1.18 Work Health and Safety (National Uniform Legislation) Act 2011 s 267(a) .… 13.7 s 267(c) .… 13.7 Workers Rehabilitation and Compensation Act 1986 .… 1.14 s 52(1) .… 1.17 Queensland Air Navigation Act 1937 s 16 .… 17.9 Civil Liability Act 2003 …. 2.14, 3.25, 3.34, 4.19, 11.27 s 2(a) .… 12.86 s 4(1) .… 13.3, 15.40 s 5 .… 2.14 s 9(1) .… 3.35 s 9(1)(b) .… 3.36 s 9(2) .… 3.40 s 10(a) .… 3.45

s 10(b) .… 3.45 s 10(c) .… 3.59 s 11(1) .…4.2, 4.34 s 11(2) .… 4.19 s 11(3) .… 4.26, 4.28 s 11(4) .… 4.34 s 12 .… 4.10 ss 13–15 .… 11.22 s 13 .… 11.27 s 15 .… 3.36, 11.28 s 15(2)(c) .… 11.28 s 16 .… 3.71 ss 17–19 .… 11.29 s 18 .… 11.29 s 19 .… 11.31 s 20 .… 3.22 s 21 .… 3.17 s 23 .… 3.25 s 22(1) .… 3.22, 3.80 s 22(2) .… 3.22 s 22(5) .… 3.23 s 23 .… 10.11 s 24 .… 10.28 ss 25–27 .… 11.47 ss 26–27 .… 11.48 ss 28–33 .… 14.41, 15.42 s 28(1)(a) .… 13.36 s 31(1)(a) .… 14.43, 15.42 s 31(3) .… 14.43

s 32D .… 14.44 s 34 .… 7.17 s 35 .… 7.17 s 35(b) .… 7.36 s 35(c) .… 7.36 s 36 .… 13.27 s 37 .… 7.26, 7.39 s 38 .… 11.48 ss 38A–38C .… 11.46 ss 39–44 .… 11.48 s 39(1) .… 11.48 s 39(1)(b) .… 11.48 s 40 .… 11.48 s 41 .… 7.26, 11.48 s 42 .… 11.48 s 43 .… 11.48 s 44 .… 11.48 s 45 .… 11.42 s 45(1) .… 11.42 s 45(2) .… 11.42 s 45(3) .… 11.42, 11.50 s 45(4) .… 11.42 s 46 .… 10.45 s 46(1)(a) .… 3.70, 10.47 s 46(1)(b) .… 10.47 s 46(1)(c) .… 3.70, 10.47 ss 47–49 .… 10.43 s 47 .… 10.40, 10.44

s 47(1) .… 10.40, 10.47 s 47(2) .… 10.47 s 47(3) .… 10.40, 10.47 s 47(4) .… 10.40, 10.47 s 47(5) .… 10.40, 10.47 s 48 .… 10.44 s 48(1) .… 10.47 s 48(2) .… 10.47 s 48(3) .… 10.47 s 48(4) .… 10.44, 10.47 s 48(5) .… 10.44, 10.47 s 49 .… 10.43, 10.47 s 49A .… 12.3 s 49B .… 12.3 s 50 .… 13.2 s 52 .… 12.85, 12.71, 12.86, 19.46, 19.52 s 54(1) .… 12.32 s 54(2) .… 12.32, 12.66 s 55 .… 12.51 s 55(2) .… 12.51 s 55(3) .… 12.51 s 56 .… 12.44 s 57 .… 12.60, 12.66 s 59 .… 12.26 s 59(1) .… 12.26 s 59(1)(a) .… 12.22, 12.66 s 59(1)(b) .… 12.22, 12.66 s 59(1)(c) .… 12.22, 12.66 s 59(2) .… 12.22, 12.66

s 59(4) .… 12.66 ss 59A–59D .… 12.28, 12.48 s 60(1)(b) .… 12.19 ss 61–62 .… 12.86 s 61 .… 12.69 s 61(1)(c)(ii) .… 12.69 s 62 .… 12.69 ss 63–67 .… 12.6 s 63 .… 12.6 s 64 .… 12.6 s 67 .… 12.6 ss 68–72 .… 3.74 s 72 .… 3.75 s 73 .… 3.56 Dictionary .… 12.32, 14.33 Sch 2 .… 14.33 Sch 6A .… 12.86 Civil Liability Act 2011 s 60(2) .… 12.48 Civil Liability Regulation 2003 .… 12.69 reg 9 .… 12.80, 12.83, 12.103 Civil Liability Regulation 2014 reg 8 .… 12.83 reg 14(2) .… 12.80 Sch 4 .… 12.83 Sch 7 .… 12.86 Sch 7, item 1 .… 12.86 Civil Proceedings Act 2011 .… 1.21

s 60(2) .… 12.42 s 64 .… 1.21 Criminal Code 1899 s 6 .… 11.42 s 276 .… 19.12 Defamation Act 2005 …. 20.3 s 4 .… 20.21 s 6(2) .… 20.3 s 7 .… 20.4 s 9 .… 20.12 s 9(2) .… 20.12 s 9(5) .… 20.12 s 10 .… 20.11 s 21(1) .… 20.4, 20.37 s 21(3)(b) .… 20.4 s 23 .… 20.9 s 25 .… 20.16, 20.37, 20.38 s 26 .… 20.17, 20.37, 20.38 s 27 .… 20.19 s 27(2)(a) .… 20.19 s 27(2)(b) .… 20.19 s 27(2)(d) .… 20.21 s 28(1) .… 20.28 s 28(3) .… 20.28 s 28(4) .… 20.28 s 29.… 20.29 s 29(4) .… 20.29 s 30(1) .… 20.23 s 30(2) .… 20.23

s 30(3) .… 20.23 s 31(1) .… 20.26, 20.37 s 31(4)(a) .… 20.26, 20.37 s 31(4)(b) .… 20.26, 20.37 s 31(4)(c) .… 20.26 s 31(5) .… 20.26 s 32(1) .… 20.10 s 32(2) .… 20.10 s 32(3)(a) .… 20.10 s 32(3)(e) .… 20.10 s 31(3)(f)(ii) .… 20.10 s 31(3)(g) .… 20.10 s 33.… 20.30 Factories and Shops Act 1960 .… 13.25 Firearms and Offensive Weapons Act 1979 s 63(2) .… 13.19 Invasion of Privacy Act 1971 .… 17.20 Law Reform Act 1995 s 5 .… 10.9, 13.33, 15.49 s 6 .… 13.35, 14.37 s 10 .… 10.6 s 10(1) .… 10.25 s 10(5) .… 10.35 ss 15–16 .… 11.47 s 16 .… 11.47, 11.48 Limitation of Actions Act 1974 s 11 .… 15.27 Motor Accident Insurance Act 1994 .… 1.17

s 4B .… 11.46 s 5 .… 11.46 Motor Vehicle Accidents (Lifetime Support Scheme) Act 2013 …. 1.12 National Injury Insurance Scheme (Queensland) Act 2016 …. 1.13, 1.18 Pt 2 Div 1 .… 1.18 s 12 .… 1.18 s 12(2)(a) .… 1.18 Personal Injuries Proceedings Act 2002 …. 2.14 Property Law Act 1974 s 147 .… 19.41 Residential Tenancies and Rooming Accommodation Act 2008 s 353 .… 19.11 Supreme Court Act 1995 s 17 .… 1.20 s 244(1) .… 15.54 s 244(9) .… 15.54 Victims of Crime Assistance Act 2009 .… 1.15, 1.18 s 22 .… 1.18 Whistleblowers Protection Act 1994 s 43 .… 13.22 Work Health and Safety Act 2011 …. 13.16 s 267(a) .… 13.7 s 267(c) .… 13.7 Workers’ Compensation and Rehabilitation Act 2003 .… 1.14, 1.18 s 140(1) .… 1.18 s 128B(2) .… 1.18 s 237(1)(a) .… 1.18 Workers’ Compensation and Rehabilitation and Other Legislation

Amendment Act 2013 .… 1.18 Workplace Health and Safety Act 1981 …. 13.16 Workplace Health and Safety Act 1995 s 28(1) .… 13.16 South Australia Citrus Industry Act 1991 .… 13.17 s 25(4) .… 13.17 s 37 .… 13.17 Citrus Industry Regulations 2005 .… 13.17 Civil Liability Act 1936 .… 2.14, 3.7, 4.19, 4.60, 10.34 Pt 6 .… 15.40 s 3 .… 9.6, 10.40, 12.32, 12.60, 12.66, 12.83, 12.86 s 3(1) .… 12.32 s 4 .… 2.14 s 4(1) .… 13.3 ss 19–22 .… 3.65 s 23 .… 1.21 s 31 .… 3.11 s 32(1) .… 3.35 s 32(2) .… 3.40 s 33 .… 4.60 s 33(1) .… 4.60, 9.6 s 33(2)(a) .… 9.7 s 33(2)(b) .… 4.60, 9.13 s 33(3) .… 4.60, 9.7 s 34(1) .…4.2, 4.34 s 34(2) .… 4.19 s 34(3) .… 4.34

s 35 .… 4.10 ss 36–38 .… 11.22 s 37(3) .… 11.27 s 38 .… 11.27 s 38(2)(c) .… 11.28 s 39 .… 3.71 s 40 .… 3.13, 3.79, 3.80 s 41(1) .… 3.22 s 41(2) .… 3.22 s 41(5) .… 3.23 s 42 .… 7.39 s 43(1) .… 11.42 s 43(1)(a) .… 11.42, 11.50, 11.51 s 43(1)(b) .… 11.42 s 43(2) .… 11.42 s 43(4) .… 11.42 s 43(4)(c) .… 11.42, 11.51 s 44(1) .… 10.11 s 45 .… 10.35 s 46(1) .… 10.40, 10.47 s 46(2) .… 10.40, 10.47 s 46(3) .… 10.40, 10.47 s 46(4) .… 10.42, 10.47 s 47 .… 10.44 s 47(1) .… 10.43, 10.44, 10.47, 11.11 s 47(2) .… 10.43, 10.47 s 47(2)(b) .… 10.44 s 47(3) .… 10.43, 10.44, 10.47 s 47(4) .… 10.43, 10.47

s 47(5) .… 10.43, 10.47 s 47(6) .… 10.44, 10.47, 11.11 s 48(1) .… 10.40 s 48(2) .… 10.40 s 49 .… 10.23, 10.44 s 50 .… 10.34 s 51 .… 9.19, 14.21, 16.37 s 51(a)(ii)(A) .… 13.2 s 51(a)(ii)(B) .… 13.2, 19.26 s 52 .… 12.69, 19.25 s 52(1) .… 12.86 s 52(1)(a) .… 12.71 s 52(2) .… 12.86 s 52(2)(c)(vi) .… 12.86 s 53(1) .… 9.9, 9.10 s 53 .… 9.10 s 53(1)(a) .… 9.10 s 53(2) .… 9.6, 9.12, 9.21 s 53(3) .… 9.6, 9.14 s 54(1) .… 12.66 s 54(2) .… 12.32, 12.66 s 55 .… 12.60, 12.63, 12.66 s 56A(6) .… 12.44 s 57 .… 12.65 s 58(1) .… 12.26, 12.66 s 58(1)(a) .… 12.23 s 58(2) .… 12.23, 12.66 s 58(3) .… 12.23, 12.66

s 59 .… 14.24 s 62 .… 17.9 s 67 .… 12.3 s 67(2) .… 12.3 s 74 .… 11.47 s 74(1) .… 11.48 s 74(2) .… 11.48 s 74(4) .… 11.48 s 74(4)(a) .… 11.47 s 74A .… 11.46 s 75 .… 3.74 Defamation Act 2005 …. 20.3 Sch A1 .… 20.21 s 4 .… 20.21 s 6(2) .… 20.3 s 7 .… 20.4 s 9 .… 20.12 s 9(2) .… 20.12 s 9(5) .… 20.12 s 10 .… 20.11 s 21 .… 20.9 s 21(1) .… 20.4 s 21(3)(b .… 20.4 s 23 .… 20.16, 20.37, 20.38 s 24 .… 20.17, 20.37, 20.38 s 25 .… 20.19 s 25(2)(a) .… 20.19 s 25(2)(b) .… 20.19 s 25(2)(d) .… 20.21

s 26(1) .… 20.28 s 26(3) .… 20.28 s 26(4) .… 20.28 s 27.… 20.29 s 27(4) .… 20.29 s 28(1) .… 20.23 s 28(2) .… 20.23 s 28(3) .… 20.23 s 29(1) .… 20.26, 20.37 s 29(4)(a) .… 20.26, 20.37 s 29(4)(b) .… 20.26, 20.37 s 29(4)(c) .… 20.26 s 29(5) .… 20.26 s 30(1) .… 20.10 s 30(2) .… 20.10 s 31.… 20.30 s 31(3)(a) .… 20.10 s 31(3)(f)(ii) .… 20.10 s 31(3)(g) .… 20.10 s 33.… 20.30 Sch A1.… 20.21 Fair Trading Act 1987 s 42 .… 11.32 s 42(2) .… 11.34 s 42(3) .… 11.34 Juries Act 1927 s 5 .… 20.4, 20.37 Landlord and Tenant Act 1936

s 6 .… 19.41 Law Reform (Contributory Negligence and Apportionment of Liability) Act 2001 Pt 3 .… 14.41, 15.42 s 3 .… 10.9 s 3(1) .… 13.33 s 3(2) .… 13.36 s 3(2)(c) .… 14.44 s 4(1) .… 13.35 s 4(1)(c) .… 13.36 s 6 .… 14.37 s 7 .… 10.6 s 7(1) .… 10.6 s 7(2) .… 10.6, 10.25, 15.50, 19.15 s 8(2)(b) .… 14.43 s 12 .… 14.37 Limitation of Actions Act 1936 s 48 .… 14.19 Motor Vehicle Accidents (Lifetime Support Scheme) Act 2013 …. 1.18 Motor Vehicles Act 1959 s 99(3a) .… 11.46 Municipal Tramways Trust Act 1906 s 74 .… 11.39 Occupational Health, Safety and Welfare Act 1986 s 23 .… 13.20 s 24(2a) .… 13.25 s 24(2a)(a) .… 13.25 s 24A .… 13.20 Residential Tenancies Act 1995

s 95 .… 19.11 Return to Work Act 2014 …. 1.18 Pt 5 .… 1.18 s 73 .… 1.18 s 74 .… 1.18 Supreme Court Act 1935 s 30 .… 15.54 s 30B .… 12.7 s 30BA .… 12.6 Victims of Crime Act 2001 .… 1.15, 1.18 s 33 .… 1.18 Volunteers Protection Act 2001 .… 11.48 s 4 .… 11.48 s 4(1)(a) .… 11.48 s 4(1)(b) .… 11.48 s 4(2) .… 11.48 s 4(3) .… 11.48 Work Health and Safety Act 2012 s 267(a) .… 13.7 s 267(c) .… 13.7 Workers Rehabilitation and Compensation Act 1986 .… 1.14, 1.17 s 54(1) .… 1.17 s 54(2) .… 1.17 Tasmania Civil Liability Act 2002 …. 2.14, 3.17, 4.19, 4.60, 13.3 Pt 9A .… 14.41, 15.42 s 3 .… 12.26 s 3B .… 2.14

s 3B(1)(a) .… 9.19, 14.21, 16.36, 19.26 s 3B(3) .… 13.3 s 3C .… 14.33 s 4A .… 13.3 s 5 .… 10.40 s 5(1) .… 10.40, 10.47 s 5(2) .… 10.40, 10.47 s 5(3) .… 10.40, 10.47 s 5(4) .… 10.47 s 5(5) .… 10.40 s 5(6) .… 10.47 s 5A .… 13.3 s 6(1) .… 11.42 s 6(1)(a) .… 11.42 s 6(1)(b) .… 11.42 s 6(2) .… 11.42 s 6(3) .… 11.42 s 6A .… 13.3 s 7 .… 3.74 s 7(2) .… 3.75 s 7A .… 13.3 s 8 .… 12.6 s 8(1) .… 12.6 s 8(2) .… 12.6 s 10 .… 13.3, 15.40 s 11(1) .… 3.35 s 11(2) .… 3.40 s 11(3) .… 3.45 s 12(a) .… 3.45

s 12(b) .… 3.59 s 13(1) .…4.2, 4.34 s 13(2) .… 4.19 s 13(3) .… 4.26, 4.28 s 13(4) .… 4.34 s 14 .… 4.10 ss 15–17 .… 11.22 s 17 .… 11.28 s 17(2)(c) .… 11.28 ss 18–20 .… 11.29 s 19 .… 11.29 s 21(2) .… 3.23 s 22(1) .… 3.22 s 22(2) .… 3.22 s 22(5) .… 3.23 s 23 .… 10.11 s 24 .… 13.2 s 25 .… 12.44 s 26 .… 12.32 s 26(1) .… 12.66 s 27 .… 12.71 s 27(1) .… 12.86, 19.25 s 27(2) .… 12.86 s 27(3) .… 12.86 s 27(4)(a) .… 12.86 s 27(4)(b) .… 12.86 s 28(1) .… 12.69 s 28(2) .… 12.69

s 28A .… 12.63, 12.66 s 28A(a) .… 12.60 s 28A(b) .… 12.60 s 28B .… 12.26 s 28B(2) .… 12.24, 12.66 s 28B(3) .… 12.24, 12.66 s 28BA .… 12.28, 12.48 s 28C .… 12.25, 12.66 s 29 .… 9.6 s 32(1) .… 9.9 s 32(2) .… 9.9 s 32(2)(a) .… 9.9 s 32(3) .… 9.9 s 33 .… 9.6, 9.12, 9.21 s 34(1) .… 4.60, 9.6 s 34(2) .… 9.7 s 34(3) .… 4.60, 9.13 s 34(4) .… 9.7 s 35 .… 4.60, 9.6, 9.14 ss 35A-35C .… 11.47 s 35C(1)(a) .… 11.48 s 35C(1)(b) .… 11.48 s 35C(2) .… 11.48 ss 35D–35F .… 11.46 s 37 .… 7.17, 7.26 s 38 .… 7.17 s 38(b) .… 7.36 s 38(c) .… 7.36 s 40 .… 13.27

s 41 .… 7.26, 7.42, 7.43 s 42 .… 7.39 s 43 .… 7.21 s 43A(1)(a) .… 13.36 s 43A(5)(b) .… 14.44 s 43B(3)(b) .… 14.43 ss 44–49 .… 11.48 s 47(1) .… 11.48 s 47(2) .… 11.48 s 47(3) .… 11.48 s 47(3)(b) .… 11.48 Common Law (Miscellaneous Actions) Act 1986 s 5 .… 12.24 Criminal Code 1924 s 45 .… 19.12 Damage by Aircraft Act 1963 s 3 .… 17.9 Defamation Act 2005 …. 20.3 s 4 .… 20.21 s 6(2) .… 20.3 s 7 .… 20.4 s 9 .… 20.12 s 9(2) .… 20.12 s 9(5) .… 20.12 s 10 .… 20.11 s 21(1) .… 20.4, 20.37 s 21(3)(b .… 20.4 s 23 .… 20.9

s 25 .… 20.16, 20.37, 20.38 s 26 .… 20.17, 20.37, 20.38 s 27 .… 20.19 s 27(2)(a) .… 20.19 s 27(2)(b) .… 20.19 s 27(2)(d) .… 20.21 s 28(1) .… 20.28 s 28(3) .… 20.28 s 28(4) .… 20.28 s 29.… 20.29 s 29(4) .… 20.29 s 30(1) .… 20.23 s 30(2) .… 20.23 s 30(3) .… 20.23 s 31(1) .… 20.26, 20.37 s 31(3)(f)(ii) .… 20.10 s 31(4)(a) .… 20.26, 20.37 s 31(4)(b) .… 20.26, 20.37 s 31(4)(c) .… 20.26 s 31(5) .… 20.26 s 32(1) .… 20.10 s 32(2) .… 20.10 s 32(3)(a) .… 20.10 s 32(3)(e) .… 20.10 s 33.… 20.30 Fatal Accidents Act 1934 s 4 .… 1.21 Landlord and Tenant Act 1935 s 69 .… 19.41

Limitation Act 1974 s 5 .… 15.27 s 5A .… 15.27 Motor Accidents (Liabilities and Compensation) Act 1973 .… 1.13, 1.18 s 2A .… 11.46 s 14 .… 11.46 s 14(4)(c) .… 11.46 s 22(4) .… 10.23 s 22(5) .… 1.18 Residential Tenancies Act 1997 s 56 .… 19.11 Stolen Generations of Aboriginal Children Act 2006 .… 1.16, 1.17, 1.18 s 11 .… 1.18 s 21 .… 1.16, 1.18 Supreme Court Civil Procedure Act 1932 s 11(13) .… 15.54 Victims of Crime Assistance Act 1976 .… 1.15, 1.18 s 9 .… 1.18 Work Health and Safety Act 2012 s 267(a) .… 13.7 s 267(c) .… 13.7 Workers Rehabilitation and Compensation Act 1988 .… 1.14, 1.18 s 133(1) .… 1.18 s 138AB(2) .… 1.18 s 138AB(3) .… 1.18 Wrongs Act 1954 s 2 .… 10.9, 13.33, 13.35, 15.49 s 2(c) .… 13.35

s 3 .… 14.37 s 4 .… 10.6, 10.25 s 4(1) .… 10.28 s 4(4) .… 10.35 Victoria Accident Compensation Act 1985 .… 1.18, 12.42 s 134(32) .… 12.60 s 134AB(22)(c) .… 12.85 s 134AB(38)(f) .… 12.42 Accident Towing Services Act 2007 s 153 …. 12.101 s 153(1) …. 12.101 Australian Consumer Law and Fair Trading Act 2012 s 22 .… 11.32, 11.34 Crimes Act 1958 s 247G .… 18.7 s 463B .… 6.14 Defamation Act 2005 …. 20.3 s 4 .… 20.21 s 6(2) .… 20.3 s 7 .… 20.4 s 9 .… 20.12 s 9(2) .… 20.12 s 9(5) .… 20.12 s 10 .… 20.11 s 21(1) .… 20.4, 20.37 s 21(3)(b .… 20.4 s 23 .… 20.9

s 25 .… 20.16, 20.37, 20.38 s 26 .… 20.17, 20.37, 20.38 s 27 .… 20.19 s 27(2)(a) .… 20.19 s 27(2)(b) .… 20.19 s 27(2)(d) .… 20.21 s 28(1) .… 20.28 s 28(3) .… 20.28 s 28(4) .… 20.28 s 29.… 20.29 s 29(4) .… 20.29 s 30(1) .… 20.23 s 30(2) .… 20.23 s 30(3) .… 20.23 s 31(1) .… 20.26, 20.37 s 31(3)(f)(ii) .… 20.10 s 31(4)(a) .… 20.26, 20.37 s 31(4)(b) .… 20.26, 20.37 s 31(4)(c) .… 20.26 s 31(5) .… 20.26 s 32(1) .… 20.10 s 32(2) .… 20.10 s 32(3)(a) .… 20.10 s 32(3)(e) .… 20.10 s 33.… 20.30 Factories and Shops Act 1928 s 59(1)(a) .… 13.20 Fair Trading Act 1999

s 22 .… 11.32, 11.34 Emergency Management Act 1986 .… 13.16 Limitation of Actions Act 1958 s 5(1A) .… 15.27, 16.30 s 23A .… 16.30 Mental Health Act 1986 s 10 .… 6.14, 7.16 Occupational Health and Safety Regulations 2007 reg 3.1.1 .… 13.24 reg 3.1.2 .… 13.24 reg 3.1.2(1) .… 13.24 Public Health and Wellbeing Act 2008 s 154 .… 11.46 Railways Act 1928 .… 18.31 Residential Tenancies Act 1997 Pt 2 Div 8 .… 19.11 Road Management Act 2004 s 40 .… 13.18 ss 102–103 .… 7.39 Supreme Court Act 1986 s 38 .… 15.54 s 79 .… 19.41 Transport Accident Act 1986 .… 1.13, 1.18 s 61(2) .… 1.18 s 93(3)(b) .… 1.18 s 93(7) .… 12.85, 12.86 s 93(7)(a) .… 1.18 s 93(7)(b) .… 1.18 s 93(10)(c) .… 12.25, 12.66

s 93(13) .… 1.18, 12.60, 12.66 s 173(1) .… 12.60, 12.66 Victims of Crime Assistance Act 1996 .… 1.15, 1.18 s 61 .… 1.18 Workplace Injury Rehabilitation and Compensation Act 2013 .… 1.14, 1.18 s 325 .… 1.18 s 325(2)(e)(i) .… 1.18 s 326 .… 12.85 s 327 .… 1.18 s 335 .… 1.18 s 340(a) .… 1.18 s 340(b) .… 1.18 s 340(c) .… 1.18, 12.85 s 342 .… 1.18 s 345 .… 1.18, 12.66 Wrongs Act 1958 .… 2.1, 2.14, 4.21, 7.42, 10.35, 11.24, 11.47 Pt IVAA .… 14.41, 15.42 Pt VBA, div 5 .… 12.86 s 5A(2) .… 15.40 ss 14A–14E .… 3.65 s 14B(3) .… 3.36 s 14B(4)(fa) .… 3.70, 10.39, 10.47 s 14B(4)(fb) .… 3.70, 11.41, 11.42, 11.51 ss 14F–14G .… 3.70 s 14F .… 2.10 s 14G .… 2.10, 10.39, 10.47, 10.49, 10.50, 11.50, 11.51 s 14G(2)(b) .… 11.41, 11.42 ss 14I–14L .… 3.74

s 14J .… 3.75 s 14K .… 3.75 s 16 .… 1.21 s 23A(1) .… 13.35 s 23B .… 13.35, 14.37 s 24 .… 14.37 s 24AF(1) .… 13.36 s 24AI(3) .… 14.43 s 24AM .… 14.44 s 25 .… 10.9, 13.33, 15.49 s 26(1) .… 10.6, 10.25 s 26(1A) .… 10.6 s 26(4) .… 10.35 s 28A .… 12.42 s 28B .… 9.19 s 28C .… 1.23 s 28C(1) .… 13.2 s 28C(2)(a) .… 9.19, 14.21, 16.37, 19.26 s 28C(2)(m) .… 12.91, 12.97 s 28F(1)(c) .… 12.55 s 28F(2) .… 12.29, 12.32, 12.66 s 28F(3) .… 12.29, 12.32 s 28G .… 12.86 s 28H .… 12.86 s 28HA(1) .… 12.69 s 28HA(2) .… 12.69 s 28I.… 12.66 s 28I(1).… 12.63

s 28I(2)(a) .… 12.60 s 28I(2)(b) .… 12.60 s 28IA(1) .… 12.22, 12.66 s 28IA(2) .… 12.22, 12.66 s 28IB .… 12.22, 12.66 s 28ID .… 12.29 s 28ID(1) .… 12.29 s 28IE .… 12.29 s 28LB .… 12.71, 12.86, 19.25 s 28LE .… 12.86 s 28LF .… 12.86 s 28LG .… 12.86 ss 28M-28N .… 12.6 s 28M .… 12.6 s 28N .… 12.6 s 30 .… 17.9 s 31 .… 17.9 ss 31A-31D .… 11.47 s 31B .… 11.47 s 31B(1) .… 11.48 s 31B(2) .… 11.48 s 31B(3) .… 11.47, 11.48 s 31B(4) .… 11.48 s 31E-31H .… 11.46 ss 34–42 .… 11.48 ss 35–37 .… 11.48 s 35 .… 11.48 s 35(3) .… 11.48 s 38(1)(a) .… 11.48

s 38(1)(b) .… 11.48 s 38(2) .… 11.48 s 38(2)(a) .… 11.48 s 38(2)(b) .… 11.48 s 44 .… 13.3, 15.40 s 45 .… 2.14 s 48 .… 3.36 s 48(1) .… 3.35, 3.77 s 48(1)(b) .… 3.35. 3.36 s 48(2) .… 3.40, 3.77, 3.78 s 48(3) .… 3.27 s 49(a) .… 3.45 s 49(b) .… 3.45, 3.78 s 49(c) .… 3.59 s 51(1) .…4.2, 4.34 s 51(2) .… 4.19, 4.21 s 51(3) .… 4.29 s 51(4) .… 4.34 s 52 .… 4.10 ss 53–54 .… 11.22 s 55 .… 3.71 s 56 .… 3.72 s 57 .… 3.22 s 58 .… 3.13, 3.79, 3.80 s 59 .… 3.24 s 59(1) .… 3.22, 3.80 s 59(2) .… 3.22, 3.79 s 60 .… 3.23, 3.79

s 61 .… 14.47 s 61(1) .… 14.33 s 61(2) .… 14.33 s 62 .… 10.11 s 63 .… 10.28 s 67 .… 9.6 s 72(1) .… 9.6 s 72(2) .… 9.7 s 72(3) .… 9.7 s 73(1) .… 9.9 s 73(2) .… 9.9 s 74(1) .… 4.60 s 74(1)(a) .… 4.60, 9.6 s 74(1)(b) .… 9.7 s 74(2) .… 4.60, 9.13 s 75 .… 4.60, 9.6, 9.12, 9.14, 9.19, 9.21 s 79 .… 7.17 s 82 .… 7.18 s 83 .… 7.17 s 83(b) .… 7.36 s 83(c) .… 7.36 s 84(2) .… 13.27 s 85 .… 7.21 Western Australia Civil Liability Act 2002 .… 2.14, 3.66, 4.60, 10.31 Pt 1CA .… 11.46, 11.47, 11.48 Pt 1F .… 14.41, 15.42 Table, Item 1 .… 19.26

s 3 .… 9.19, 12.91, 12.97 s 3A .… 2.14 s 3A(1) .… 9.19, 14.21, 16.37, 19.26 s 4 .… 12.86 s 5A .… 13.3, 15.40 s 5A(2) .… 15.40 s 5B(1) .… 3.35 s 5B(2) .… 3.40 s 5C(1) .…4.2, 4.34 s 5C(2) .… 4.19 s 5C(3) .… 4.26, 4.28 s 5C(4) .… 4.34 s 5D .… 4.10 s 5E .… 11.29, 11.32 ss 5E-5I .… 11.29 s 5H .… 11.29 s 5I .… 11.30 s 5J .… 11.32 s 5J(5) .… 11.33 s 5J(6) .… 11.34 s 5K .… 10.11, 10.14, 10.51 s 5L .… 10.40 s 5L(1) .… 10.40, 10.47 s 5L(2) .… 10.40, 10.47 s 5L(3) .… 10.40, 10.47 ss 5AAA-5AAD .… 11.46 s 5AA .… 7.21 ss 5AB-5AE .… 11.47 s 5AC .… 13.3

s 5AD .… 11.48 s 5AD(2) .… 11.48 s 5AE .… 11.48 ss 5AF-5AH .… 3.74 s 5AG .… 13.3 s 5AH(2) .… 3.75 s 5AI .… 13.36 s 5AJ .… 13.3 s 5AJA(1)(b) .… 14.44 s 5AK(3)(b) .… 14.43 ss 5M-5O .… 11.22 s 5O .… 11.28 s 5P .… 3.23 s 5PA .… 3.22, 3.79 s 5PB(1) .… 3.22 s 5PB(2) .… 3.23 s 5PB(4) .… 3.22, 3.79 s 5PB(6) .… 3.22 s 5Q .… 9.6 s 5S(1) .… 4.60, 9.6 s 5S(2) .… 9.7 s 5S(3) .… 4.60, 9.13 s 5S(4) .… 9.7 s 5T .… 4.60, 9.6, 9.14 s 5U .… 7.17, 7.35 s 5W .… 7.17 s 5X .… 7.35, 7.42, 7.43 s 5Z .… 7.39

s 6 .… 13.2 s 9(1) .… 12.71, 12.86, 19.25 s 9(2) .… 12.86 s 9(3) .… 12.86 s 9(10) .… 12.86 s 10 .… 12.86 s 10A(1) .… 12.69 s 11(1) .… 12.32, 12.66 s 11(3) .… 12.32 s 12(1) .… 12.23, 12.26, 12.66 s 12(2) .… 12.23, 12.66 s 12(3) .… 12.23, 12.66 s 12(4) .… 12.23, 12.66 s 12(5)–(7) .… 12.23, 12.66 s 13 .… 12.23, 12.66 ss 14–15 .… 12.6 s 14 .… 12.6 s 15 .… 12.6 Criminal Code s 8 .… 11.45 s 371A .… 11.45 Criminal Code Act Compilation Act 1913 .… 19.9 s 243 .… 19.9 s 244 .… 19.9 s 247 .… 19.9 s 248 .… 19.9 s 253 .… 19.12 s 254 .… 19.9, 19.55 Criminal Injuries Compensation Act 2003 .… 1.15, 1.18

s 3C .… 1.17 s 3D .… 1.17 s 21 .… 1.18 s 42 .… 1.18 Damage by Aircraft Act 1964 s 4 .… 17.9 Defamation Act 2005 …. 20.3 s 4 .… 20.21 s 6(2) .… 20.3 s 7 .… 20.4 s 9 .… 20.12 s 9(2) .… 20.12 s 9(5) .… 20.12 s 10 .… 20.11 s 21(1) .… 20.4, 20.37 s 21(3)(b .… 20.4 s 23 .… 20.9 s 25 .… 20.16, 20.37, 20.38 s 26 .… 20.17, 20.37, 20.38 s 27 .… 20.19 s 27(2)(a) .… 20.19 s 27(2)(b) .… 20.19 s 27(2)(d) .… 20.21 s 28(1) .… 20.28 s 28(3) .… 20.28 s 28(4) .… 20.28 s 29.… 20.29 s 29(4) .… 20.29

s 30(1) .… 20.23 s 30(2) .… 20.23 s 30(3) .… 20.23 s 31(1) .… 20.26, 20.37 s 31(4)(a) .… 20.26, 20.37 s 31(4)(b) .… 20.26, 20.37 s 31(4)(c) .… 20.26 s 31(5) .… 20.26 s 32(1) .… 20.10 s 32(2) .… 20.10 s 32(3)(a) .… 20.10 s 32(3)(e) .… 20.10 s 32(3)(f)(ii) .… 20.10 s 33.… 20.30 Environmental Protection Act 1986 .… 13.20 Fatal Accidents Act 1959 s 4 .… 1.21 Land Act 1933 .… 17.16 Land Administration Act 1997 .… 17.16 Law Reform (Contributory Negligence and Tortfeasors Contribution) Act 1947 s 3 .… 13.33 s 3A .… 10.9 s 4 .… 10.6 s 4(1) .… 10.6, 10.25, 10.31, 15.50, 19.15 s 4(1A) .… 10.9 s 4(2) .… 10.35 s 7 .… 13.35, 14.37 Law Reform (Miscellaneous Provisions) Act 1941

s 5 .… 12.60, 12.66 Motor Vehicle (Catastrophic Injuries) Act 2016 …. 1.13, 1.18 s 8(3) .… 1.18 Motor Vehicle (Third Party Insurance) Act 1943 …. 1.18 s 3C .… 1.18 s 3D .… 1.18 s 16(4) .… 12.7 Occupiers’ Liability Act 1985 .… 3.65, 3.66 Petroleum Pipelines Act 1969 s 7 .… 13.12 s 25 .… 13.12 s 36A .… 13.12 s 38 .… 13.12 s 39(2) .… 13.12 s 57 .… 13.12 Residential Tenancies Act 1987 s 80 .… 19.11 Strata Titles Act 1985 s 35(1)(c) .… 13.18 Supreme Court Act 1935 s 25(10) .… 15.54 Volunteers and Food and Other Donors (Protection from Liability) Act 2002 .… 11.46, 11.48 s 4(1) .… 11.48 s 6(1) .… 11.48 s 6(2)(b) .… 11.48 s 6(3)(a) .… 11.48 s 6(3)(b) .… 11.48 Workers’ Compensation and Injury Management Act 1981 .… 1.14,

1.18 s 93H(1) .… 1.18 s 93K(4)(d) .… 1.18 s 93K(5) .… 1.18 United Kingdom Airports Authority Act 1975 .… 17.21 Betting and Lotteries Act 1934 s 11(2)(b) .… 13.13 Compensation Act 2006 s 3 .… 4.20 Contagious Diseases (Animals) Act 1869 s 75 .… 13.20 Defamation Act 2013 …. 20.2 Employers’ Liability Bill …. 11.3 Factories Act 1937 s 22(1) .… 13.24 Factories Act 1961 s 29(1) .… 13.29 Law Reform (Contributory Negligence) Act 1945 .… 10.5 Lord Cairn’s Act .… 15.54 Maritime Conventions Act 1911 .… 10.5 Petroleum (Production) Act 1934 .… 17.10 Torts (Interference With Goods) Act 1977 .… 18.1 Waterworks Clauses Act 1847 s 35 .… 13.18 United States of America Constitution

First Amendment .… 20.2 Restatement (Second) of the Law of Torts § 46 .… 9.15 § 242 .… 18.25 § 652A .… 15.13 Canada Statutes of Ontario 1924, c 32 .… 10.5 New Zealand Accident Compensation Act 1972 .… 1.9 Injury Prevention, Rehabilitation and Compensation Act 2001 .… 1.9 First Amendment .… 9.15 International International Convention on the Rights of the Child .… 13.12 Art 37(b) .… 13.12

Contents Preface Acknowledgments Table of Cases Table of Statutes and Regulations 1 2

Introduction Overview of Negligence

3 4

Standard of Care Causation: Factual Causation and Scope of Liability

5 6

Duty of Care: Basic Concepts ‘Affirmative Action’: The Duty to Act

7 8

Liability of Public Authorities Economic Loss

9 10

Mental Harm Defence: Contributory Negligence

11 12

Other Defences and Special Protections Assessment of Damages for Personal Injuries

13 14

Breach of Statutory Duty Loss Distribution Mechanisms: Vicarious Liability, Non-Delegable Duties, Contribution between Tortfeasors and Proportionate Liability

15 16

Nuisance Trespass to the Person

17 18

Trespass to Land Intentional Torts Relating to Goods

19 20

Defences to and Remedies for Intentional Torts Defamation

21

Revision

Index

Detailed Contents Preface Acknowledgments Table of Cases Table of Statutes and Regulations

1

Introduction Torts — Definition and Description The Role of Fault No-Fault Compensation Schemes for Personal Injury Statutory Changes to Common Law Actions: Prior to the 2002 Ipp Panel Report Choice of Law/Conflict of Laws and Legislative Interventions Our Journey

2

Overview of Negligence Elements of the Tort of Negligence Breach of the Duty to Take Care: The Standard of Care Expected of the ‘Reasonable Person’ Cause Harm that is Not Too Remote Duty to Take Care Defences Vicarious Liability Damages Assessment Statutory Changes to Common Law Actions: After the Ipp Panel Report (Generally 2002–03) Heated Debate: Critics and Defenders of the Changes

The Upshot 3

Standard of Care The Standard of Care Stated The Reasonable Person General Practice, Custom and Regulation Professionals and Statutory Changes (Bolam, Rogers, Naxakis) Nature of the Risk of Harm The Reasonable Person’s Response: The ‘Calculus of Negligence’ Additional Standard of Care/Breach Issues

4

Causation: Factual Causation and Scope of Liability Factual Causation Scope of Liability

5

Duty of Care: Basic Concepts Reasonable Foreseeability and Duty: Existence vs Extent Subsequent Developments — Proximity, Salient Features, Autonomy and Vulnerability

6

‘Affirmative Action’: The Duty to Act Where There is a Special Relationship Between Plaintiff and Defendant Duty to Prevent Another from Causing Damage or Loss to the Plaintiff

7

Liability of Public Authorities When Does a Public Authority Owe a Duty to Exercise its Statutory Powers? What Duty Does a Public Authority Owe when it Exercises its Statutory Powers?

Highway Authorities 8

Economic Loss Liability for Negligent Misstatements Causing Purely Economic Loss Liability for Negligent Acts Causing Purely Economic Loss

9

Mental Harm Negligently Caused Mental Harm Intentional Infliction of Mental Harm

10 Defence: Contributory Negligence Statutory Intervention: Apportionment Replaces the Common Law’s ‘All-or-Nothing’ Rule What Constitutes Contributory Negligence? The Standard of Reasonable Care Applied to the Plaintiff’s Conduct Causation How Apportionment Operates Appeals Intoxication 11 Other Defences and Special Protections Voluntary Assumption of Risk Exclusion of Liability by Notice Illegality Special Protection or Immunity from Liability 12 Assessment of Damages for Personal Injuries The ‘Once and Forever’ Principle Terminology Pecuniary Losses

Summary Table Non-Pecuniary Losses Aggravated and Punitive (or Exemplary) Damages Summary Table Collateral Benefits 13 Breach of Statutory Duty Does the Statute Confer on the Plaintiff a Right to Sue? Was the Plaintiff a Member of the Protected Class? Was the Statute Directed at Preventing the Kind of Harm Suffered by the Plaintiff? The Statutory Duty Must Have been Imposed on the Chosen Defendant Has the Statute Been Breached? Causation and the Onus of Proof Defences, Contribution and Proportionate Liability 14 Loss Distribution Mechanisms: Vicarious Liability, NonDelegable Duties, Contribution between Tortfeasors and Proportionate Liability Introduction to Loss Distribution Mechanisms Vicarious Liability: Introduction Vicarious Liability: The Existence of a Relationship of Employer and Employee Vicarious Liability: Acting in the Course of Employment Vicarious Liability: The Employer’s Indemnity from the Employee Non-Delegable Duties Contribution between Tortfeasors and Proportionate Liability 15 Nuisance Two Types of Private Nuisance

Private Nuisance by Interference with Use and Enjoyment of Property Rights Private Nuisance by Material Physical Damage; Strict Liability in Nuisance and the Onus of Proof Private Nuisance and Personal Injuries Private Nuisance: Who Has Standing to Sue? Private Nuisance: Who May Be Found Liable? Statutory Authorisation as a Defence to an Action in Private Nuisance Contributory Negligence as a Defence to an Action in Private Nuisance Remedies in Private Nuisance Public Nuisance 16 Trespass to the Person Battery Assault False Imprisonment The Onus of Proof and Negligent Trespass The Effect of Statutory Reform 17 Trespass to Land What is ‘Land’ for the Purposes of Trespass to Land? The Plaintiff’s Title to Sue in Trespass The Effect of Consent or Other Authorisation 18 Intentional Torts Relating to Goods Trespass to Goods Conversion Detinue

19 Defences to and Remedies for Intentional Torts Defences Necessity Self-Defence, Provocation and Defence of Another Protection of Property and Goods, Re-Entry on Land and Recaption of Goods Contributory Negligence Consent, Inevitable Accident and Mistake Statutory Authorisation Remedies 20 Defamation What Makes a Publication Defamatory? Publication Who May Bring an Action in Defamation? Defences Remedies 21 Revision Critique of Negligence: Personal Injuries, No-Fault Compensation and Reform Comprehensive Revision Problem Discussion for Comprehensive Revision Problem Additional Problem for your Consideration: Daisy Bay — Revisited One More Problem for the Road, with a Negligence Focus (and Some Defamation, for Good Measure): Additional Anguish in Daisy Bay Index

[page 1]

1 Introduction Objectives After completing this chapter, you should: — understand what a tort is; — understand and be able to evaluate the objectives of torts; — understand how negligence law interacts with no-fault compensation schemes; — understand and be able to evaluate some essential features of no-fault compensation schemes; — have a working knowledge of how one can claim for harm caused by a defective product, under a regime created by statute.

Key legislative developments — In all jurisdictions, no-fault compensation schemes have been introduced by legislation. They have varying breadth and coverage and are relevant to a range of activities. — Trade Practices Act 1974 (Cth) Pt VA, enacted in 1992, which is now part of the Australian Consumer Law and the Competition and Consumer Act 2010 (Cth).

Torts – Definition and Description 1.1 It is difficult to give a general definition, or even a general description, of what torts are. The word ‘tort’ is French for ‘wrong’, and torts are wrongs committed by people on other people. They are often described as ‘civil wrongs’, to distinguish them from criminal wrongs. Criminal wrongs give rise to criminal proceedings brought by the state; civil wrongs give rise to civil proceedings brought by private individuals. [page 2] Yet this distinction does not help much in finding a definition as some criminal wrongs, such as assault and battery, are also civil wrongs. Also, not all civil wrongs are torts. A breach of contract can be described as a civil wrong as it is wrong not to do what you have contractually promised to do. A breach of contract is a private civil wrong rather than a criminal wrong, but a breach of contract is not necessarily a tort. Confusingly though, some breaches of contract can give rise to an action in tort. 1.2 Although both torts and breaches of contract are civil wrongs, they are wrongs for different reasons. In contract, the parties themselves determine the parties’ rights and obligations by what they have promised one another. A breach of contract is a wrong because it is a departure from what the parties themselves have determined should happen. By way of contrast, in tort, the law determines the parties’ rights and obligations. A tort is a wrong because it is a departure from what the law determines should happen. For example, consider a situation where one of us (Martin or Ian) contracts to give you legal advice. Let’s say I promise to give you sound advice of a professional standard in return for your promise to pay me. If I negligently give you bad or wrong advice that causes you loss, you may sue me for compensation for that

loss. You may sue me for breaching the contract between us, because I promised to give you good legal advice, and I failed to do so. You may also sue me in tort, because the law imposes on me a duty or obligation to give careful legal advice (of a reasonable standard) in such a situation, quite independently of what I have promised to do. In contrast, if I run you over in the street because I have negligently driven my car, you may sue me in tort, but not contract. I did not promise you that I would drive carefully as I may never have met you. However, the law imposes on me a duty or obligation to drive with due care (of a reasonable standard) for your safety. 1.3 The law of torts is not the only part of the law that determines a person’s obligations. The criminal law also determines what we should and should not do: like a tort, a crime is a wrong because it is a departure from what the law determines should happen. However, torts and crimes are also wrongs for different reasons. A crime is a wrong against the common good. In contrast, a tort is a wrong against a particular individual. For example, if you knife me in the stomach and steal my wallet, you have committed the crimes of wounding and theft. Although you have clearly wronged a particular individual (me), your behaviour is criminal because the community in general deplores such behaviour and wants to be protected against it. If the state prosecutes you for those crimes, it does so to punish you for what you have done, as an expression of public disapproval of your conduct, and also to deter you (and others) from doing it again. For quite different reasons, I may sue you in tort for the wrongs you have done to me. As a private individual, I may seek compensation or damages for the injuries you caused me with your knife and for the loss of my wallet. In contrast, if I negligently chop down a tree in my garden, so that it falls on your car outside my house, my conduct may be tortious, but not criminal. The law [page 3]

determines that my conduct is wrongful because I have wronged you in particular, but I have not wronged the community in general. 1.4 In some ways, it is easier to give a general description of the law of torts by describing what it is not rather than by describing what it is: it is not like contract, and it is not like crime. Part of the reason for the attraction of this negative approach is that there are many different torts and they have little, if anything, in common. That is why we speak of the law of torts, rather than of the law of tort. It is difficult to find any meaningful common denominator that covers all of the different torts. There are two main ‘ingredients’ which one should think about when considering a particular tort’s elements. One element focuses on the plaintiff or claimant: does the particular tort require the plaintiff or claimant to have suffered harm? Whether or not this is required is essentially historical in nature. The second element focuses on the defendant’s conduct: different torts require different kinds of conduct. Most require faulty conduct, which may be intentional or careless. In most torts, it is an essential part of the wrong that the defendant is at fault in some way, but in some torts, called ‘strict liability’ torts, fault on the part of the defendant is not a necessary element and the wrong lies simply in the fact that the plaintiff has suffered loss or damage. A tort like negligence, which is a relatively modern tort in historical terms, cannot be satisfied unless the plaintiff proves the existence of a legally recognised injury or loss caused by the defendant’s wrongful conduct. With this tort, ‘damage is the gist of action’. For example, if a doctor does not dispose of a used needle correctly and you accidentally prick yourself on it, you cannot sue simply because you fear you will suffer harm, such as getting HIV or hepatitis C. Rather, you must actually sustain HIV or hepatitis C — the harm — before being able to bring a claim. By way of contrast, other torts, like trespass to the person (assault, battery and false imprisonment), do not require you to have suffered harm or injury to be able to litigate, largely because of the historical and traditional importance attached to the protection against the invasion of your bodily integrity.

In short, there are many torts that have little in common, other than the fact that they are wrongs because the law says they are wrongs, and that they are wrongs to private individuals that lead to private civil actions, usually (but not always) for compensation in the form of damages. In this respect, torts are a little like birds: it is easy enough to recognise a bird when you know what one is, but it is quite difficult to describe to someone what birds are if they do not already know. Most birds fly, but some do not — not everything that flies is a bird. Most torts are primarily concerned with compensation. Some torts are not concerned with compensation and not every legal action seeking compensation is an action in tort. Some birds, like seagulls, can swim and fly; some, like penguins, can swim but cannot fly; some, like sparrows, can fly but cannot swim; some, like emus, cannot swim or fly. As we noted above, some torts, like negligence, require both fault on the part of the defendant and loss to the plaintiff (see Chapters 2–12). Some torts, like trespass to the person, consist of a kind of fault on the part of the defendant, without the need for any loss to the plaintiff (see Chapter 16). Some torts, like defamation (see Chapter 20) and Rylands v Fletcher (1866) LR 1 Ex 265; (1868) LR 3 HL 330 (a ‘bird’, [page 4] always rare, that became extinct in 1994), consist of loss to the plaintiff without the need for any fault on the part of the defendant. There are no emu-torts, where there is neither fault on the part of the defendant nor loss to the plaintiff. Birds have beaks or bills and lay eggs; squid and platypus have beaks and bills respectively, and snakes and turtles lay eggs, but squid, platypus, snakes and turtles are not birds. Torts are civil wrongs. However, breaches of contract are also civil wrongs, and they are not necessarily torts. All birds grow feathers, and no other things grow feathers, so it is possible at least to define a bird

as something that grows feathers. Although this may be a definition of a bird, it is not a particularly helpful description of birds in general, as it gives no indication of the huge range and variety of types of bird. Similarly, it is possible to define a tort as follows: a civil wrong actionable at the suit of a private individual (or individuals), which is actionable because the law says that it is wrong. Although this may be a definition, it is not much of a description of torts in general as it gives no indication of the range and variety of torts or the similarities and differences between them. That can be done only by considering a number of different particular torts. Accordingly, this book considers some (but not all) of the different types of tort. It focuses mainly on the tort of negligence, because it is the most important tort in modern legal practice. However, it also considers other torts, to give a general idea of the very different kinds of tortious liability. For example, we consider different types of trespass and, in this new edition, the tort of defamation, quite unlike the other torts explored throughout this book.

The Role of Fault 1.5 The tort of negligence is the most important tort in practice, because there are many more actions in negligence than there are in any other tort. Negligence is primarily, but not exclusively, concerned with compensation for personal injuries. Thus, in numerical terms, most actions in tort are actions in the tort of negligence for compensation for personal injuries. However, negligence actions can be instituted to recover for property damage and purely economic loss (in somewhat limited circumstances with respect to the latter type of harm). We outline this tort’s basic elements as well as its objectives in an ‘Overview of Negligence’ — see Chapter 2. To briefly foreshadow the objectives of the tort of negligence, they are often said to include securing damages or compensation for harm suffered, deterrence, punishment, appeasement, education and standard setting. As we note, different torts may have different objectives. For example, someone suing in the torts of battery or

assault may wish to deter future similar conduct on behalf of the community generally as well as punish the particular defendant. These goals may not be real concerns for someone who suffers reputational harm and wants an apology or retraction, suing in the tort of defamation. If someone suffers serious injury in a motor vehicle accident due to someone else’s momentary (but careless) neglect, often that person’s sole real goal is compensation. [page 5] 1.6 As its name suggests, there can be no liability in the tort of negligence without fault on the part of the defendant. The plaintiff must prove that the defendant was at fault in order to recover compensation for her or his injuries. From one point of view, this is fair and just. For example, if a car driver knocks down a pedestrian, because he (the driver) has just been stung in the eye by a bee, it does not seem fair and just that he should be required to compensate the pedestrian for any injuries she (the pedestrian) has suffered. The pedestrian’s injuries were not the driver’s fault; there was nothing he could do to prevent them. In contrast, if the driver runs down the pedestrian because he has just dozed off at the wheel, it does seem fairer and more just that he should be required to compensate the pedestrian for her injuries, as her injuries were his fault; he could have prevented them by not driving while drowsy. From another point of view, though, the fault-based system of compensation does not seem particularly fair and just at all. In both of the above examples, the pedestrian was run over and injured without any fault on her own part. As far as the pedestrian is concerned, it makes no difference to her why she was run over, as the end result is the same in both cases: namely, that she has suffered injury through no fault of her own. Under the traditional fault-based system of compensation in the tort of negligence, she would receive compensation in the case of the sleeping driver, but not in the case of the bee-stung driver even though her injuries are exactly the same in

both cases. It would be small consolation to the injured, but uncompensated, pedestrian to know that her injuries were not the beestung driver’s fault.

The role and effect of third party liability insurance 1.7 The fault-based system of compensation for injuries seems even more arbitrary when one realises that many, if not most, potential defendants are insured against the risk of liability in tort. However, the ability to secure affordable insurance has become difficult for some enterprises. This has led to legislative changes to some tort law principles, which will presumably lead to fewer claims being litigated. Insurance against liability for personal injuries is legally compulsory for drivers of motor vehicles; the liability insurance premium forms part of the price of the vehicle registration. It is also compulsory in almost all states for employers to insure against common law liability for workplace injuries to their employees. There is no common law liability for workplace accidents in the Northern Territory and for most such accidents in South Australia: see the table below at 1.18. The purpose of compulsory liability insurance is to ensure that injured plaintiffs can sue a defendant that is able to make effective compensation. Thus, the injured plaintiff receives compensation in full, whether or not the negligent defendant has any money of her or his own as it is the defendant’s insurer, not the defendant, who actually compensates the plaintiff. A fault-based system of compensation makes some sense if the defendant is personally responsible for compensating the plaintiff, because in these circumstances the person at fault is the person who is required to make compensation (assuming punishment and deterrence are worthy aims). However, where the defendant [page 6]

is insured against the risk of liability, the person at fault does not compensate the injured person; her or his insurer does so. The presence or absence of fault on the part of the defendant does not personally affect the defendant at all as she or he suffers no loss either way. In contrast, the presence or absence of fault on the part of the defendant is crucial to the plaintiff, as it affects whether or not she or he can recover compensation from the defendant’s insurer. Thus, in the examples given in 1.6, neither the sleeping driver nor the bee-stung driver would be personally required to compensate the injured pedestrian. However, at common law, the pedestrian injured by the sleeping driver would receive compensation from that driver’s insurer, but the pedestrian injured by the bee-stung driver would not, as she cannot prove fault (carelessness). The concept of fault has little, if anything, to do with personal responsibility and ‘moral blame’ in practice. The main practical function of the concept of fault is to determine which injured plaintiffs have access to insurance funds, and which do not. To many, this does not seem at all desirable, particularly in the light of the fact that the whole purpose of insurance is to spread losses. In the above example, the loss borne by the sleeping driver’s insurer will be spread across the whole of the motor vehicle-driving community, and each vehicle owner may have to pay a fraction of a cent more for next year’s vehicle registration sticker because of the compensation paid by the insurer to the injured pedestrian. In contrast, the unlucky pedestrian injured by the bee-stung driver must herself bear all the losses she suffers as a result of her injuries. Unless she were independently wealthy, she would have to pass on some of those losses to the state by claiming social security or health care benefits to help her cope with the cost of her injuries.

No-Fault Compensation Schemes for Personal Injury

1.8 One solution to the anomalies presented by the way in which common law tort actions operate (which will become increasingly apparent as you explore the principles on which negligence claims operate), with many deserving injured persons left without a remedy, is simply to replace the common law fault-based system of compensation with a system of compensation for personal injuries that does not depend on fault at all. There is a range of approaches to the ways in which no-fault compensation can be provided, from comprehensive schemes to those that are piecemeal, or context-related in nature. Each scheme is complex, as are the ways in which they interact with each other and the common law. Although Australia does not have a comprehensive national no-fault compensation scheme that eliminates the right to sue at common law, it does have a number of discrete no-fault schemes of limited application. The most prevalent and common schemes arise in three different contexts, defined causally: no-fault compensation for injuries sustained as a result of motor vehicle accidents, workplace accidents and criminal acts of violence. If the claimant successfully argues that she or he fits within the statutory definition which determines the scheme’s boundaries, she or he can recover specific entitlements outlined in the legislation. Some of the most notable schemes that have been implemented will soon be sketched in the [page 7] sections that follow, after first noting efforts related to implementing comprehensive schemes.

New Zealand’s comprehensive scheme and Australia’s failed attempt 1.9 In 1972, New Zealand passed the Accident Compensation Act 1972 (NZ), which introduced a comprehensive statutory no-fault compensation scheme. Under that scheme, any person injured by

accident in New Zealand may recover compensation for her or his injuries, whatever the type of accident, and whether or not that accident was caused by someone else’s fault. Compensation is paid by the Accident Compensation Corporation, which is funded by levies on employers and motor vehicles, and also from general taxation revenue. The New Zealand no-fault scheme was introduced as the result of the report in 1967 of a Royal Commission chaired by Sir Owen Woodhouse, who was then a judge of the New Zealand Court of Appeal. The scheme has been re-enacted several times; the most recent version is now called the Accident Compensation Act 2001 (NZ) (formerly named the Injury Prevention, Rehabilitation and Compensation Act 2001 (NZ)). In 1973–74, Sir Owen chaired a National Committee of Inquiry in Australia, which recommended the introduction of a comprehensive national no-fault compensation scheme, covering both injury and sickness. A bill to create such a scheme was introduced into the Commonwealth Parliament in 1975, but was never passed.1 Despite the failure of the Australian attempt to establish a comprehensive no-fault compensation scheme in the mid-1970s, interest in establishing such a scheme is often advocated. Many would argue that the existing array of haphazard schemes sitting alongside tort do not successfully meet disabled persons’ needs in an equitable manner.

The National Disability Insurance Scheme and National Injury Insurance Scheme 1.10 In April 2010, the federal government referred an inquiry into the implementation of a ‘national disability long-term care and support scheme in Australia’ to the Productivity Commission.2 The Productivity Commission released its Inquiry Report, Disability Care and Support, in August 2011. It recommended the establishment of the federal-run National Disability Insurance Scheme (NDIS)

[page 8] and the state/territory-run National Injury Insurance Scheme (NIIS). The National Disability Insurance Scheme Act 2013 (Cth) (NDIS Act), which became operational on 1 July 2013, created the NDIS. The scheme commenced in a transitional phase in 2016, with full coverage projected for all Australians by July 2019.3 1.11 The NDIS provides no-fault funding for various types of disability support for people with a significant and permanent disability. It is estimated that 460,000 will benefit from the scheme.4 The NDIS is designed to complement, not replace, existing compensation arrangements for personal injury.5 The NDIS Act establishes the framework for the scheme, including the objects and principles under which the scheme will operate; criteria for access; participant plans; administration; privacy; and review. The Act also established the National Disability Insurance Agency (NDIA) to deliver the scheme.6 To be eligible, an applicant must have a disability that is permanent and substantial.7 It is only available to those under 65 years of age. A person also may be entitled to access the NDIS despite not meeting the disability requirement if the person meets ‘early intervention requirements’.8 The NDIS website lists conditions which will generally meet the criteria of impairment, permanence and substantially reduced functional capacity.9 The types of disability supports covered by the scheme relate to health, mental health, child protection and family support, early childhood development, school education, higher education and vocational education and training, employment, housing and community infrastructure, transport and justice.10 It does not purport to award damages. One important difference between this scheme and previously proposed no-fault compensation schemes is that this scheme does not extinguish the right to sue at common law, in which fault must be established. Indeed, applicants are required to seek available compensation, including damages for personal injury, from other

sources before accessing the NDIS.11 In fact, an arguably misguided provision states that if an individual refuses to pursue a common law action which is said to have a reasonable chance of success, the chief executive officer of the scheme has the [page 9] power to suspend the disabled person’s care plan.12 These aspects of the scheme may prove problematic in practice, because assessing the prospects of success could be difficult. It is a curious approach in that it seems to encourage litigation, which is contrary to fundamental features in previously enacted (New Zealand) or proposed (Australia) comprehensive schemes, like those of Woodhouse (see 1.9). 1.12 The NIIS, which is complementary to the NDIS, is evolving. It is a ‘federated model’ of separate state and territory no-fault accident insurance schemes for catastrophic injuries.13 It covers catastrophic injuries incurred in transport, workplace, medical and general (home and community) circumstances, with motor vehicle accidents the first area of coverage. It has a series of ‘minimum benchmarks’ that are meant to be satisfied, as a result of which ‘lifetime care and support’ are to be provided.14 Catastrophic injuries include major brain injuries, spinal cord injuries, severe burns, multiple amputations and permanent traumatic blindness.15 Support under the motor vehicle accident schemes, for example, which is provided on a no-fault basis, may include medical treatment and rehabilitation, physiotherapy, wheelchairs, support for personal care needs, home and vehicle modifications, aids and appliances, educational support, vocational and social rehabilitation and domestic assistance.16 If one is catastrophically injured, one can sue for economic loss (loss of earnings and loss of future earning capacity) and non-pecuniary losses (such as pain and suffering). Further, those who suffer less severe injuries can sue.17 The NIIS was introduced in Queensland on 1 July 2016, and

currently covers anyone who sustains a catastrophic injury in a motor vehicle accident in Queensland.18 In addition, there have been legislative developments in the Australian Capital Territory, South Australia and Western Australia relating to motor vehicle accidents, which align with the principles of the NIIS.19 The Northern Territory is discussed below. Merging the NIIS and NDIS is a long-term goal. [page 10]

Transport accidents 1.13 No-fault compensation schemes for injuries sustained in transport accidents were introduced many years ago in the Northern Territory, Tasmania and Victoria.20 New South Wales implemented a no-fault scheme in 200621 and in 2013–14, South Australia and the Australian Capital Territory followed suit. In the Northern Territory, a person injured in a motor vehicle accident receives benefits on a no-fault basis, but cannot bring a common law action,22 whereas in Tasmania, one can receive no-fault benefits and sue at common law (but the no-fault benefits are relatively limited).23 In Victoria, those injured in transport accidents are entitled to receive no-fault benefits (with limitations), but can only sue if the injury is determined or deemed to be ‘serious’, in accordance with the American Medical Association’s Guides to the Evaluation of Permanent Impairment (4th ed).24 Transport accident compensation schemes in these three jurisdictions have been part of the legal landscape for decades and appear to be well accepted in their communities. However, that is not to say the ‘birth’ of schemes of this nature is without controversy. For example, in 1986, the Victorian government initially proposed a ‘pure’ no-fault transport accident scheme, not unlike the Northern Territory; as a trade-off for the implementation of a generous no-fault scheme, the right to sue was abolished. The then-proposed scheme was the cause of great debate, with fears expressed about the deleterious

effects such a scheme would have on common law rights — its encroachment on the right to sue. To break the political impasse in parliament, a compromise was reached, whereby claimants were given a very limited right to sue (if ‘seriously injured’), with limits imposed with respect to the damages that can be awarded in the common law action (thresholds; ceilings; non-recoverable damages, such as those that are medical in nature). In these three jurisdictions, anyone injured in a transport accident may recover compensation from a state-run body (in the Northern Territory, the Territory Insurance Office; in Tasmania, the Motor Accidents Insurance Board; in Victoria, the Transport Accident Commission), whether or not the accident was caused by someone else’s fault. The schemes are funded from vehicle licence payments. Generally, a claimant governed by one of these no-fault compensation schemes is excluded from recovering certain kinds of benefits in specified situations. For example, some types of compensation are not available or are reduced if the claimant was injured while driving in an intoxicated state, or committing an indictable offence. In a manner similar to workers’ compensation schemes, ‘double compensation’ (through the tort claim and no-fault statutes) is avoided. [page 11] The New South Wales regime, established in 2006–07, is different to those enacted in the Northern Territory, Tasmania and Victoria. A classic example of piecemeal legislative reform, it provides limited benefits in different ways: •

Benefits primarily relate to lifelong medical care and related treatment and rehabilitation, which are provided to a specific class of claimant: a person who suffers a ‘catastrophic injury’, such as spinal cord injury, brain damage or blindness. She or he is entitled to these benefits, even if someone else’s fault cannot be established

as the cause of the injury (or the catastrophically injured person was at fault). Common law actions are not precluded with respect to economic loss that relates to income loss and future loss of earnings or non-economic loss (pain and suffering). •

The Motor Accidents Compensation Amendment Act 2006 (NSW) also allows for ‘recovery for blameless accidents’.25 If someone is injured in a ‘blameless’ or ‘inevitable’ motor vehicle accident, she or he can bring a claim against the insurer of any vehicle that happens to be ‘involved’ in the accident. The ‘blameless accident’, defined as one not caused by the fault of the owner or driver, is (rather curiously) deemed to be one that has been caused by the fault of the owner or driver. It covers situations where ‘no-one is considered to have been at fault — for example, when a person is injured because a driver experiences an unforeseen illness or medical condition, which results in a loss of control over the vehicle’26 (a driver suffers a stroke or heart attack while driving, or loses control because of a bee sting). Notably, a significant gap remains: the driver who caused the accident is excluded from an entitlement to recover for her or his own injury. However, if that driver is ‘catastrophically injured’, she or he is entitled to the limited benefits under the state’s Lifetime Care and Support Scheme. The way in which contributory negligence is dealt with in this context is noted at 10.29.

•

‘Special entitlements’, which essentially are medical care and related treatment benefits, are provided to a child under 16 years of age who is injured (or dies) in a motor vehicle accident even though the driver may not have been at fault. Even if the child is contributorily negligent (partially to blame for her or his injury, for example, by running onto the road without looking), this is to be ignored, unless the child commits a serious offence that contributed materially to her or his injury or death.

In compliance with the NIIS, South Australia introduced a no-fault scheme, the Lifetime Support Scheme, under the Motor Vehicle Accidents (Lifetime Support Scheme) Act 2013 (SA). As of 1 July 2014,

individuals who suffer catastrophic injury are entitled to benefits, which include the cost of medical treatment, rehabilitation, attendant care and support services, educational and vocational training, modifications (home, motor vehicle and workplace), regardless of the [page 12] ability to prove fault. Economic losses related to loss of earnings and loss of earning capacity and non-economic losses (pain and suffering) are recoverable at common law (with restrictions), if one can prove fault. Further, injured individuals may also bring common law actions with respect to non-catastrophic injuries. As part of the South Australian legislative reforms, as of 1 July 2013, children under 16 years of age are eligible for compensation on a no-fault basis with respect to their continuing medical costs.27 The Australian Capital Territory also established a no-fault scheme in the motor vehicle context — the Lifetime Care and Support Scheme, under the Lifetime Care and Support (Catastrophic Injuries) Act 2014 (ACT), which commenced on 1 July 2014. Based on the New South Wales model, it provides lifelong care, including medical treatment, rehabilitation, attendant care and educational or vocational training, to individuals who have been catastrophically injured in a motor vehicle accident, regardless of whether fault is involved in the accident leading to their harm. Coverage is similar to other schemes, as it includes spinal cord injury, brain injury, an amputated limb, burns and permanent blindness. As was the case with the newly introduced South Australian regime, this scheme also satisfies the ‘minimum benchmarks’ set by the NIIS for motor vehicle accidents. Once again, economic losses related to loss of earnings and loss of earning capacity and non-economic losses (pain and suffering) are recoverable in common law actions, on the basis of proving fault. In 2016, Queensland and Western Australia introduced the National Injury Insurance Scheme (Queensland) Act 2016 (Qld) and the Motor

Vehicle (Catastrophic Injuries) Act 2016 (WA) respectively. Both schemes satisfy the ‘minimum benchmarks’ set by the NIIS for motor vehicle accidents, providing ‘necessary and reasonable’ lifelong care. As is the case elsewhere, this includes medical or pharmaceutical treatment, dental treatment, rehabilitation, prosthesis and education or vocational treatment. In a manner similar to the schemes noted above, coverage extends to individuals suffering catastrophic injuries such as spinal cord injury, amputated limbs, burns, permanent blindness and ‘traumatic’ brain injury (a point of distinction from the ACT scheme).

Workers’ compensation 1.14 Each of the states and territories has workers’ compensation legislation which provides for no-fault compensation for injuries suffered in the workplace.28 The employer’s insurer compensates any employee who has suffered injuries in the course of her or his work, whether or not those injuries were caused by someone [page 13] else’s fault. (It is compulsory for employers to insure against their liability under the legislation.) In some states, if the employee’s injuries were caused by negligence on the part of the employer, or on the part of a fellow employee, the employee may also sue the employer for compensation in the tort of negligence. Any damages that she or he recovers in such an action will then be reduced by the amount of any workers’ compensation payments that have already been made. However, there has been a clear trend over the years to limit workers’ rights to sue in negligence in various ways. As was noted earlier, common law claims for workplace accidents do not exist in the Northern Territory and in most circumstances in South Australia. In those cases (or jurisdictions) where the right to sue is still available, statutes curtail its scope and the amount or kinds of damages that can be awarded.

Criminal injuries compensation 1.15 Criminal injuries compensation schemes have been established by legislation in all jurisdictions to provide compensation from government funds to crime victims who are unable or often unwilling to sue offenders.29 The schemes demonstrate community support to those entitled, in a moral sense, to recover for the harm they have suffered, but for whom tort litigation would be problematic. This class of injured persons has been selected for special treatment — the provision of compensation for their personal injuries — because of the obvious difficulties they would face instituting civil suits against perpetrators of batteries. Particular concerns about the nature of civil litigation in the context of criminal offences and how it can exacerbate the harm suffered (for example, psychological damage in cases of abuse) justify the establishment of the schemes. Although these schemes are, in a sense, fault-based because the applicant must be the victim of a crime to be entitled to compensation, they are properly regarded as no-fault schemes because compensation is usually made by the state, not the criminal, and because in some cases the legislation provides for compensation to be paid even if the person accused of the crime is not convicted. In general terms, criminal injuries compensation schemes provide victims of crime with limited, circumscribed benefits, such as those that are medical in nature, counselling and amounts related to lost income for a limited period of time. Under these schemes, victims of crime who receive compensation are still entitled to sue the offender in tort, albeit without receiving double compensation. The schemes essentially are discretionary in nature, in that claims to compensation under these Acts are not absolute entitlements. For example, the victim’s own behaviour or ‘character’ may disentitle her or him from being granted compensation or benefits that would otherwise be available.

[page 14]

The Stolen Generations Compensation or reparations schemes 1.16 In a very different but terribly important legal, political and moral context to those noted above, in 2006 Tasmania became the first jurisdiction to enact legislation whereby Aboriginal persons who are members of the ‘Stolen Generations’ can claim compensation for having been forcibly removed from their families by welfare agencies. The Stolen Generations of Aboriginal Children Act 2006 (Tas) provides ex gratia payments to applicants who meet the Act’s eligibility criteria, determined by the Stolen Generations Assessor. Several significant features include the following: •

An amount of $5 million has been paid by the Tasmanian government to the Stolen Generations Fund, to be used to make these payments.

•

Approximately 125 Tasmanian Aboriginal persons are entitled to compensation under the Act.

•

Those entitled to compensation include an estimated 40 still-living Aboriginal persons who were removed from their families for 12 months or more, during the period from 1935 to 1975. They are entitled to receive about $100,000 per person in compensation.

•

The child of a deceased person who was a member of the Stolen Generations is entitled to an ex gratia payment of $5,000, capped at $20,000 per family.

•

The Act further prescribes in s 21 that an ex gratia payment paid to an applicant under the Act does not render the state liable for any action taken in respect of the applicant.

Aside from its symbolic significance, the Act, in conjunction with a formal apology issued in the Tasmanian Parliament in 1997, has been lauded as the state’s tangible acknowledgment of the terrible wrongs

endured by Tasmania’s Stolen Generations. It recognises that their harm was and is real, and is considered by many to be but one small step leading to the attainment of genuine reconciliation. A number of other states have established compensation funds. In 2008, Western Australia instituted the ‘Redress Scheme’, which provided ‘forgotten persons’, including some members of the Stolen Generation, with a ‘finite amount’ of compensation between 2008 and 2011. To qualify, applicants had to have suffered ‘very severe abuse and/or neglect with ongoing symptoms and disability’. In its 2010–11 annual report, the Western Australia Department for Communities described it as ‘a finite scheme to acknowledge and apologise to adults who, as children, were abused and/or neglected while they were in the care of the state’. The scheme offered apologies, counselling services and ex gratia payments ($5,000 minimum; $45,000 maximum). In 2010, an action was instituted on behalf of nine Indigenous persons who had been removed from their families, in Western Australia.30 More recently, in November 2015, the South Australian government established an $11 million Stolen Generations Reparations Scheme. According to the government [page 15] website, approximately one-half of these funds will be allocated to individuals as compensation for their suffering, while the other half is to be allocated to broader efforts such as memorials and counselling services.31 In a similar time frame, New South Wales32 and Queensland33 have also established reparations schemes to provide compensation to individuals and to fund broader community healing efforts. Common law 1.17 By way of contrast, in circumstances where compensation has not been made available, one potential way in which the aims of

corrective justice and the attainment of damages awards can be achieved (at least in theory) involves civil litigation, in tort. Without a political solution on the horizon, tort actions have remained the last resort of (and only means available to) members of the Stolen Generations. Members of the Stolen Generations are among the most marginalised individuals in the Australian community, for whom the ballot box and political solutions have offered little solace. Arguably, tort is one of the few mechanisms by which disenfranchised members of the community, including, for example, Indigenous plaintiffs, can (again, at least in theory) enjoy a degree of empowerment, using open public processes, subjecting alleged powerful wrongdoers to scrutiny.34 Moreover, it is one of the few ways in which change might be able to be effected. The extensively reported civil claims instituted by Lorna Cubillo and Peter Gunner (Cubillo v Commonwealth (2001) 112 FCR 455; 183 ALR 249) failed in the Federal Court of Australia, leading to increased calls for a non-litigious resolution, not unlike that embarked upon and implemented in Tasmania. Ultimately, Cubillo’s and Gunner’s litigation proved to be tremendously costly, cumbersome, inordinately lengthy and, in a sense, futile. The technical requirements that needed to be satisfied in order to succeed, determined by long-standing tort doctrine, limitation of actions principles and overwhelming, complex evidentiary obstacles, were insurmountable. That said, attempts by litigants to bring claims in tort were not wholly thwarted by the legal failure of the Cubillo and Gunner actions. In a landmark, widely hailed decision, Gray J held in favour of Bruce Trevorrow, an Indigenous Australian from the Ngarrindjeri community, against the state of South Australia, for negligence, misfeasance in public office and wrongful or false imprisonment — the first such action to succeed in Australia: Trevorrow v South Australia (No 5) (2007) 98 SASR 136. Negligence was found with respect to the way in which he was removed, placed in foster care and returned to his family. His award included $450,000 for pain and suffering and $75,000 exemplary damages. (A further $250,000 was awarded

[page 16] as interest.) Trevorrow died in 2008, five months after being awarded damages. Despite his death, the South Australian government appealed the decision, to clarify some legal points, with a view presumably to withstanding future potential claims. In South Australia v LampardTrevorrow (2010) 106 SASR 331, the Full Court dismissed the state of South Australia’s appeal, although it disagreed with Gray J’s findings on breach of fiduciary duty and false imprisonment (see 16.25 and 16.27). Justice Gray’s 300-page trial judgment took 18 months to hand down. One of the reasons Trevorrow’s claim — lodged in 1998 — succeeded whereas others had failed was evidentiary in nature, based on what he was able to prove so many years after his removal from his home. On Christmas Day in 1957, when he was 13 months old, Bruce Trevorrow was taken to the Adelaide Children’s Hospital with stomach pains. Once he recovered from his illness, Bruce was sent to foster care with a white family, without his parents’ knowledge. Bruce’s family made repeated attempts to locate their son, to which the Aboriginal Protection Board responded with lies. About 10 years later, Bruce was eventually reunited with his family. In his tort claim, Trevorrow argued that because of the state authorities’ actions, he suffered a very troubled childhood and adolescence, and a lifetime struggle with alcoholism, depression, loss of cultural identity and difficulties securing employment. By comparison, his siblings, who remained with their mother, led healthy, ‘successful’ lives. Gray J’s judgment, like the Tasmanian Act, has been praised as a meaningful acknowledgment of the tremendous suffering of those stolen from their families. The success of this one action has inspired other members of the Stolen Generations to lodge claims, even though each litigant should be cautioned that every case is decided on its own unique facts. For example, in 2011, as reported in the media,35 Neville Austin settled a negligence claim he instituted against the Victorian

government. His out-of-court settlement embraced an apology and undisclosed amount of compensation. His case is the first one in which compensation has been paid to a member of the Stolen Generations by the Victorian government. Because his landmark award was part of a settlement, it is not of precedential value. It may, however, provide the impetus for additional claims to be brought by other members of Victoria’s Stolen Generations. According to press reports, Austin stated that the settlement was a ‘liberating experience’; he particularly valued the apology and expression of regret.36 One of the problems with using individualised tort actions to resolve these complex systemic wrongs is the fact that it is difficult, if not impossible, to justify why one person’s action succeeds as opposed to another’s action, which fails; why one claimant [page 17] is awarded damages whereas another is not. The provision of compensation to all members of the Stolen Generations, as part of a national response embracing true reparations, including an apology, would be a preferable, fairer way of moving forward. This type of approach would follow the Canadian lead, in which a comprehensive process and tribunal have been established to address these special wrongs, in an effort to serve the ends of corrective justice. The success of Bruce Trevorrow’s action may reinvigorate calls for a political resolution to this dark period in Australian history.

Overview: interaction of no-fault compensation schemes and common law recovery 1.18 The following table provides a brief overview of the relationship between fault-based claims and no-fault compensation schemes in Australia. It is not intended to be used as a comprehensive guide to each scheme’s structure, benefits and exclusions, which are extremely complex. They are intended to highlight a few noteworthy matters. We

advise you to read the primary sources — the relevant Acts – if you are examining situations arising in transport, workplace or criminal injuries compensation contexts that require in-depth levels of analysis. With respect to the Stolen Generations, only Tasmania’s statute is included in this table; recall that reparations schemes have been established recently in several other states: see 1.16. At this point, it should be noted that many of the special legislative provisions affecting damages or compensation make a distinction between economic (or pecuniary) losses and non-economic (nonpecuniary) losses. This distinction is examined in detail in Chapter 12. In a nutshell, in its widest sense, pecuniary losses or economic losses include losses such as hospital and medical expenses that the plaintiff must pay and will need to pay in the future as a result of the injury. It also includes loss of earnings and loss of (future) earning capacity. Non-pecuniary losses are losses that cannot be precisely quantified in money terms, such as pain and suffering, loss of limbs, loss of enjoyment of life (or loss of amenities) and loss of expectation of life. See the tables at 12.66 and 12.86 for key statutory changes to common law damages. Transport Accidents State

No-fault compensation

Claims based on fault

Australian Capital Territory

Lifetime care and support scheme for those catastrophically injured in a motor accident, National Injury Insurance Scheme (NIIS) compliant. Lifetime Care and Support (Catastrophic Injuries) Act 2014.

A person may sue for economic losses comprised of loss of earnings and loss of earning capacity and non-economic losses (pain and suffering) with respect to a catastrophic injury. A person may sue with respect to a non-catastrophic injury. Restrictions exist.

[page 18] Transport Accidents – cont’d State

No-fault compensation

Claims based on fault

New South Wales

Lifetime care and support: available to catastrophically injured (Lifetime Care and Support Guidelines: s 58 of Motor Accidents (Lifetime Care and Support) Act 2006). Authority pays treatment and care expenses that are ‘reasonable and necessary’. Children under age 16: special entitlement regardless of fault by driver: for example, hospital, medical, rehabilitation, attendant care. Driver or owner of vehicle involved is ‘deemed’ at fault for the purposes of entitlement (s 7J(1): Pt 1.2 Div 2 of Motor Accidents Compensation Act 1999). Child can be at fault and recover; no reduction for contributory negligence. Child cannot recover if injury is caused by child committing a serious offence (s 7K). Child with catastrophic injuries entitled to ongoing treatment benefits. If person is injured in a ‘blameless’ accident, fault is presumed, with entitlement to common law claim (with its limitations). Importantly, the driver who causes her or his own injury is excluded from recovery, unless catastrophic.

Common law action, but restrictions exist: for example, no recovery of non-economic losses unless degree of permanent impairment is greater than 10 per cent (Motor Accidents Compensation Act 1999 s 131); maximum recovery for nonpecuniary loss (s 134). Maximum net weekly earnings (s 125(2)). Discount rate 5 per cent unless prescribed by regulations (s 127). Restrictions on economic loss damages for attendant care services (s 141B). Indexes apply. No damages awarded to participants of LCSS (Lifetime Care and Support Scheme) for economic loss in relation to treatment and care (s 141A). Catastrophically injured persons and children can bring common law actions for damages not covered by the scheme.

Northern Territory

Compensation under the Motor Accidents (Compensation) Act 1979 for Northern Territory residents. Benefits: for example, loss of earning capacity; permanent impairment if assessed at 5 per cent; medical needs; accommodation of home.

No common law actions for Northern Territory residents: abolished by statute (s 5); common law actions for Territory residents injured in another Australian jurisdiction (s 7(3)), with limits.

[page 19]

Transport Accidents – cont’d State

No-fault compensation

Claims based on fault

Queensland

‘Necessary and reasonable’ lifetime care and support available under the National Injury Insurance Scheme (Queensland) Act 2016. Individuals must be catastrophically injured to be eligible: s 12, referring to Pt 2 Div 1 of National Injury Insurance Scheme (Queensland) Regulation 2016.

Common law actions. Restrictions exist (Motor Accident Insurance Act 1994). No double recovery: National Injury Insurance Scheme (Queensland) Act 2016 s 12(2)(a).

South Australia

Lifetime Care and Support Scheme for those catastrophically injured in a motor accident, National Injury Insurance Scheme (NIIS) compliant. Motor Vehicle Accidents (Lifetime Support Scheme) Act 2013. Commenced 1 July 2014.

A person may sue for economic losses comprised of loss of earnings and loss of earning capacity and non-economic losses (pain and suffering) with respect to a catastrophic injury. A person may sue with respect to a non-catastrophic injury. Restrictions exist.

Tasmania

Compensation under the Motor Accidents (Liabilities and Compensation) Act 1973. Includes, for example, medical benefits; some pre-accident earnings for a few years. Avoids double compensation with the unlimited common law action.

Common law actions, with some restrictions: for example, loss of earning capacity must not exceed three times average weekly earnings (s 22(5)).

Victoria

Compensation under the Transport Accident Act 1986. Extensive medical-related care; accommodation of home; loss of earnings and earning capacity, with ceilings; impairment benefits. Ceiling imposed unless over 50 per cent bodily impairment on American Medical Association’s Guides to the Evaluation of Permanent Impairment (4th ed) tables.

Common law action, but only if plaintiff has suffered a serious injury, being a degree of impairment of 30 per cent or more (s 93(3)(b)). No recovery of pecuniary losses unless they reach a threshold; maximum is imposed (s 93(7)(a)). No recovery of nonpecuniary losses unless they reach a threshold; maximum is imposed (s 93(7)(b)).

[page 20]

Transport Accidents – cont’d State

No-fault compensation

Claims based on fault No compensation for medical, hospital expenses. Minimum and maximum amounts are indexed by s 61(2). Discount rate 6 per cent (s 93(13)). No recovery for gratuitous services.

Western Australia

Under the Motor Vehicle (Catastrophic Injuries) Act 2016, lifetime care and support for individuals who are catastrophically injured in motor vehicle accidents.

Common law actions. Restrictions exist: for example, non-pecuniary loss and gratuitous services (Motor Vehicle (Third Party Insurance) Act 1943 ss 3C, 3D). No double recovery: Motor Vehicle (Catastrophic Injuries) Act 2016 s 8(3).

Workplace Accidents State

No-fault compensation

Claims based on fault

Australian Capital Territory

Compensation under the Workers Compensation Act 1951.

Common law actions, no restrictions. But no double recovery: no-fault payments deducted from damages paid at common law (s 184).

New South Wales

Compensation under the Workers Compensation Act 1987. Note Workplace Injury Management and Workers Compensation Act 1998.

Common law actions (s 151). Restrictions exist: for example, damages only awarded for past economic and future economic loss (s 151G(1)); must be ‘degree of permanent impairment’ (s 65(1)) of at least 15 per cent (s 151H(1)); maximum weekly payment, indexed (s 151I). Discount rate 5 per cent unless otherwise prescribed (s 151J(2)(b)).

Northern Territory

Compensation under the Return to Work Act 2016.

None: common law actions abolished (s 52(1)).

Queensland

Workers’ Compensation and Rehabilitation Act 2003. Maximum compensation payable as weekly payments; maximum payable as lump sum for injuries

Common law actions. Restrictions exist: for example, damages not available unless worker has suffered a terminal condition (s 237(1)(a)).

[page 21] Workplace Accidents – cont’d State

No-fault compensation

Claims based on fault

other than a latent onset injury that is a terminal condition (s 140(1)). Workers with latent onset injuries that are terminal conditions: entitled to lump sum payment and additional lump sum compensation according to graduated scale (s 128B(2)).

This threshold was introduced in October 2013 by the Workers’ Compensation and Rehabilitation and Other Legislation Amendment Act 2013. Damages for gratuitous services expressly prohibited. This also was introduced in October 2013 by amending legislation.

South Australia

Compensation under the Return to Work Act 2014.

Only if worker is ‘seriously injured’; damages are restricted to damages for future economic loss: s 73. ‘Seriously injured’ means a whole person impairment of 30 per cent or more. Otherwise, court is not allowed to award damages to any person contrary to or in a manner inconsistent with Pt 5 of the Act: s 74.

Tasmania

Compensation under the Workers Rehabilitation and Compensation Act 1988.

Common law actions. Restrictions exist: for example, damages not available unless 20 per cent permanent impairment of whole person (s 138AB(2), (3)); no maximum imposed. No double recovery: no-fault payments deducted from damages paid at common law (s 133(1)).

Victoria

Compensation under the Workplace Injury Rehabilitation and Compensation Act 2013. Came into force on 1 July 2014. This is a consolidation of the Accident Compensation Act 1985 and other legislation. Workers entitled to same/existing benefits as under Accident Compensation Act.

Common law action only if the injury arose out of, or in the course of, or due to the nature of, employment and the injury is ‘serious’ (s 327). ‘Serious injury’ means permanent serious impairment/loss of a body function; or permanent serious disfigurement; or permanent severe mental/behavioural disorder; or loss of a foetus (s 325).

[page 22] Workplace Accidents – cont’d State

No-fault compensation

Claims based on fault Deemed ‘serious’ if 30 per cent impairment (s 335). No recovery of pecuniary losses unless they reach a threshold; maximum is imposed (s 340(a)). Also (generally), worker must show a loss of gross income (earning capacity) of 40 per cent or more to be able to sue for pecuniary loss (extended definition ‘serious injury’, s 325(2)(e)(i)). No recovery for pain and suffering below threshold; maximum is imposed (s 340(b)). No compensation for medical, hospital expenses (s 340(c)). No recovery for gratuitous services (s 342). Discount rate 6 per cent (s 345). Death benefits are also available.

Western Australia

Compensation under the Workers’ Compensation and Injury Management Act 1981.

Common law actions, but worker’s ‘degree of whole of person impairment’ (s 93H(1)) must be at least 15 per cent (s 93K(4)(d)); maximum imposed. If impairment over 25 per cent, unrestricted access to common law damages (s 93K(5)).

Victims of Crime and Other Schemes State Australian Capital Territory

No-fault compensation Compensation for persons ‘affected by acts of violence’: Victims of Crime (Financial Assistance) Act 2016.

Claims based on fault Curiously, the new statute makes no mention of common law actions/civil proceedings/other rights and liabilities. Unlike its predecessor it does not expressly preserve the right to bring a common law action; nor does it expressly abolish such a right. However, because the right to sue has not been expressly eliminated,

[page 23] Victims of Crime and Other Schemes – cont’d State

No-fault compensation

Claims based on fault one can presume it is available, as is the case in other jurisdictions and was the case under the previous Act.

New South Wales

Compensation for victims of ‘acts of violence’ that apparently occurred in the commission of an offence: Victims Rights and Support Act 2013. Sporting injuries: Sporting Injuries Insurance Act 1978.

Common law actions (Victims Rights and Support Act 2013 s 102). Common law action for damages for sporting injuries, but no double recovery (Sporting Injuries Insurance Act 1978 s 35A).

Northern Territory

Compensation for ‘victims of violent acts’: Victims of Crime (Assistance) Act 2006.

Common law actions (s 62).

Queensland

Compensation for victims of acts of violence: Victims of Crime Assistance Act 2009.

Common law actions (s 22).

South Australia

Compensation for injuries arising from an offence: Victims of Crime Act 2001.

Common law actions (s 33).

Tasmania

Compensation for persons injured or killed by commission of an offence: Victims of Crime Assistance Act 1976. Compensation for members of Stolen Generations: Stolen Generations of Aboriginal Children Act 2006. Approximately $100,000 payment to each still-living member; $5,000 to child of member of Stolen Generations, capped at $20,000 for a family (s 11).

Common law actions (s 9).

Victoria

Provision of ex gratia payment does not render the state liable for any action taken by a member of the Stolen Generations (Stolen Generations of Aboriginal Children Act 2006 s 21).

Compensation for those injured or Common law actions (s 61). killed by the criminal act of another person: Victims of Crime Assistance Act 1996.

[page 24] Victims of Crime and Other Schemes – cont’d State Western Australia

No-fault compensation

Claims based on fault

Compensation to a person who Common law actions (implicit in ss has suffered injury or loss in 21, 42). consequence of the commission of an offence: Criminal Injuries Compensation Act 2003.

1.19 Although the Australian no-fault schemes are limited in scope, in reality many more injured people are compensated under them than under the tort of negligence. This is because the no-fault schemes (generally) compensate every injured person who makes a claim, rather than only those who can prove that their injuries were caused by the fault of someone else. Also, there are a number of aspects of the process of suing for compensation in negligence that deter potential plaintiffs from instituting proceedings. Litigation is expensive, and there is no guarantee that that expense will bear fruit in the form of compensation as not all plaintiffs succeed in proving the defendant was at fault (for example, see the Cubillo and Gunner claims, noted in 1.17). A plaintiff who fails must pay her or his own legal costs and some of the legal costs incurred by the successful defendant. Litigation can also be very time consuming: the plaintiff often has to wait years to find out whether she or he is to recover any compensation from the defendant. Alternative no-fault sources of compensation do not have the drawbacks associated with civil litigation — cost, delay and risk. 1.20

To sum up, to sue successfully in tort, you need:

•

a defendant to sue;

•

to be able to afford to litigate;

•

the stamina to endure the difficulties and strain of the litigation process;

•

to be able to fit your facts within the elements of the cause of action on which you are basing your claim.

If you fail, you will not recover any common law damages. However, if you were injured in one of the few causal contexts deemed by legislatures as warranting the provision of these benefits — for example, at work, or in a motor vehicle accident or as a result of a criminal act — no-fault compensation will be forthcoming. Further, additional supports will be made available to you in certain circumstances under the NDIS and NIIS. Sometimes, your right to sue in a common law claim will not be possible as it may have been eliminated by statute (or restricted). The practical deterrents against litigation are such that it is usually only those with severe injuries who seek compensation by suing in negligence. If successful, [page 25] those plaintiffs recover relatively large sums by way of damages awards, when compared to those that are recoverable under the nofault schemes. Under the schemes, what is potentially available has to be shared among all the injured persons who make claims. In other words, the no-fault schemes pay relatively modest compensation to a large number of claimants, whereas the tort of negligence provides larger compensation to a much smaller number of successful plaintiffs. It is that high-risk, high-return process of compensation that is the main focus of this book. It should be noted, though, that as a result of many of the statutory changes to the common law introduced or extended in 2002 and 2003 (generally),37 the size of potential damages awards available in common law actions has been limited. Additionally, for certain kinds of plaintiffs in specified circumstances (such as those who were intoxicated when injured, or were acting illegally, or participated in ‘dangerous recreational activities’), the possibility of succeeding in a common law claim has been diminished in many jurisdictions.

Litigation has become riskier; potential success has become more difficult in many circumstances.

Statutory Changes to Common Law Actions: Prior to the 2002 Ipp Panel Report Historically: (generally) taming the common law’s harshness 1.21 Until relatively recently, much of the doctrine studied in tort came primarily from case law. It is through the doctrine of precedent, whereby previous decisions are applied, extended, distinguished, not followed and occasionally overruled, that fundamental tort principles have evolved over many years. There has, nevertheless, been some significant legislative intervention in certain tort-related contexts. Historically, this involved circumstances where the harshness of the common law required reform, to serve the then-current legislative perceptions of community values, needs and justice. The elimination of the ‘all-or-nothing’ rule for contributory negligence is one such example: at common law, any carelessness on the part of the plaintiff to herself or himself wiped out her or his claim. Statutes were eventually enacted which permitted the apportionment of liability, eliminating this principle: see Chapter 10. Similarly, at common law, if a tortfeasor killed someone as a result of her or his tort, the deceased’s dependants had no action available to them. They could not ‘complain’ of the tort causing the death. Indeed, from a defendant’s perspective, it was accurately — and rather too quaintly (and repugnantly) — asserted that ‘it is better to kill than to maim’. Legislatures intervened, abolishing this principle, [page 26] thereby providing dependants (variously defined) with the right to

institute fatal accidents claims.38 As a reminder, other major legislative interventions in the sphere of personal injury law, considered previously in this chapter, have been of a different type. They include the establishment of no-fault compensation schemes, primarily in the context of workplace accidents, criminal injuries and, increasingly, motor vehicle accidents. These schemes filled a gap, where common law tort actions were seen to be unsatisfactory as they did not meet the needs of a large number of persons injured in circumstances commonly fraught with risk. These schemes provide compensation and related benefits (such as reasonable medical care) regardless of being able to prove a defendant’s fault. By way of contrast, the product liability legislative reforms, noted below, differ greatly from no-fault compensation schemes. The 1992 reforms created a new statutory action, under which claimants harmed by defective products could litigate against manufacturers (widely defined) in a manner that was intended to have important advantages when compared to common law negligence.

Defective products or goods: a new action created by statute (1992) 1.22 In a joint report published in 1990, the Australian Law Reform Commission and the Law Reform Commission of Victoria recommended changes to the law of product liability that illustrate another possible solution to the problems posed by a fault-based system of compensation.39 Under a fault-based system of product liability, any person who is injured or harmed by a defective product must prove fault on the part of someone else, such as the manufacturer or the supplier, if she or he is to recover compensation. Thus, for the reasons described above, only some of the people injured by defective products receive compensation under such a system. Under the system proposed in the joint report, any person who suffered loss or damage caused by the way goods acted would have had a right to compensation if the goods were manufactured or

supplied by a corporation in trade and commerce. (The restriction of liability to corporations in trade and commerce derived from the fact that the Commonwealth has only limited legislative powers under the Constitution, a topic which is beyond the scope of this book. The proposed Victorian legislation would not have been limited in that way.) The manufacturer would have been obliged to pay that compensation, whether or not it was at fault in any way. If the manufacturer of the goods did not have a place of business in Australia, the importer or the supplier of the goods would have been obliged to pay. [page 27] The system proposed in the joint report was one of strict liability. The injured person could recover compensation whether or not someone else was at fault. Unlike the no-fault compensation schemes considered above, compensation would not have been paid out of a state-administered fund, but would have been paid by the manufacturer, importer or supplier of the goods that caused the damage. Thus, the costs of injury would not have been borne by the injured person or by the state, but by those who produced and supplied the goods. Those costs would then have been spread throughout the community by the manufacturers, importers and suppliers increasing the price of their products. In other words, from the consumer’s point of view, the right to compensation would have become part of the price of the product. 1.23 The legislation eventually enacted did not take the form proposed in the joint report. Part VA of the Trade Practices Act 1974 (Cth), introduced in 1992, created a new action specifically designed for defective products. It became part of the Australian Consumer Law (Sch 2 to the Competition and Consumer Act 2010 (Cth)). It creates a cause of action that must be instituted and litigated, with its own particular requirements that must be satisfied for a claim to succeed. It provides that any individual who is injured by a defect in goods may

recover compensation from the manufacturer, or, if the manufacturer is not in Australia, the importer, or, if the manufacturer remains unknown, the supplier: see s 7(1) of the Australian Consumer Law (previously, ss 74A(4), 75AB of the Trade Practices Act). The key provision is s 9(1) of the Australian Consumer Law (previously s 75AC(1) of the Trade Practices Act), which provides that for the purposes of this Part of the Act, goods only have a defect ‘if their safety is not such as persons generally are entitled to expect’. Section 142(c) of the Australian Consumer Law (previously, s 75AK(1) (c) of the Trade Practices Act) provides that the defendant has a defence (known as the ‘state-of-the art’ defence) if the state of scientific or technical knowledge at the time when the goods were supplied was not such as to enable the defect to be discovered. The inclusion of this defence was of particular concern to the pharmaceutical industry. The combined effect of these provisions is that although the basis of liability under Pt 3.5 (injury caused by a product’s ‘defect’) is different from that in the tort of negligence (fault or carelessness), the end result will often be similar.40 It is a watered down or muted version of the originally intended strict liability regime. Not surprisingly, this action, created by statute, required judicial interpretation to gain insight into the meaning of several of its provisions. The following is the first case decided under this statutory action. [page 28] Case Example Glendale Chemical Products Pty Ltd v Australian Competition and Consumer Commission (1998) 90 FCR 40; [1999] ATPR ¶ 41–672 Facts: Mr Barnes, purchaser of Glendale Caustic Soda, poured the product down his shower recess drain in order to unblock it, using boiling water. A column of water

rushed out of the pipe, severely burning his eyes and face. Although the product’s label warned consumers to use rubber gloves and safety masks because of the product’s corrosive nature, it did not warn consumers not to use hot water. Issue: Was the defendant liable under Pt VA of the Trade Practices Act 1974 (Cth)? What kind of test is used to determine the safety persons generally are entitled to expect? Decision: Barnes succeeded in his negligence action against Glendale, as its conduct was found to be unreasonable: it had not acted as a reasonable person ought to have acted in the circumstances, as it had taken inadequate precautions against the risk of consumers suffering potentially severe injury (see generally Chapter 3). The Australian Competition and Consumer Commission (and Barnes) also succeeded under Pt VA. During the course of its reasoning, the court considered the philosophy behind the Act, highlighted in the report of the two Law Reform Commissions that led to Pt VA’s enactment (notwithstanding significant differences between the report and the statute). The court held that even though Glendale only packed the product, it fell within the Act’s extensive definition of ‘manufacturer’, whereby it was deemed as such. More importantly, perhaps, all three Federal Court judges hearing the appeal agreed with the trial judge’s decision that the product had a ‘defect’ under s 75AC, despite the fact the caustic soda had acted as intended and there was no defect in the product itself (for example, in terms of its chemical composition). The main issue was whether or not the product was defective because of the nature of the instructions and warnings printed on the container’s label. In assessing the ‘safety persons generally are entitled to expect’, the court stated that the standard is objective, not based on what any particular individual is entitled to expect, but the expectations of the public at large (which is not the same as requiring the good to be absolutely free of risk). Liability was found, in that it was not safe to market this product without warning of its propensity to erupt when combined with hot water.

In Carey-Hazell v Getz Bros & Co (Aust) Pty Ltd (2004) ATPR ¶42-014; [2004] FCA 853, a case involving an allegedly defective heart valve, Kiefel J (when she was on the Federal Court) endorsed this objective standard (at ATPR 59,735; [186]): The standard referred to in s 75AC(1), that goods are defective if they do not provide the level of safety which persons generally are entitled to expect, was described in the Explanatory Memorandum (at para 14) as an objective standard. It is based upon what the public at large, rather than any particular individual, is entitled to expect.

Carey-Hazell v Getz Bros & Co (Aust) Pty Ltd was applied in the following case. [page 29]

Case Example Merck Sharp & Dohme (Australia) Pty Ltd v Peterson (2011) 196 FCR 145; 284 ALR 1 Facts: In December 2003, Mr Peterson, the claimant, suffered a heart attack (or myocardial infarction (MI)) while being treated for arthritis with a medication called Vioxx. Vioxx was subsequently withdrawn from the market, in September 2004. He instituted several actions, including one under the Trade Practices Act 1974 (Cth) s 74AD (a defective product) and common law negligence. With respect to the former action, he argued that the drug was defective, it caused his harm and the state-of-the-art defence could not be employed to refute liability. He pleaded that the respondent knew or ought to have known that the consumption of Vioxx increased the risk of heart attack and it was negligent for failing to warn of this risk. Issue: Was Vioxx a defective product? Was the consumption of Vioxx a necessary condition of Mr Peterson’s heart attack? (The causation issue is the same under the defective product statutory action (s 75AD) and at common law.) Can the respondent successfully rely upon the ‘state-of-the-art’ defence? Decision: The claim in negligence and the action under s 75AD failed because causation could not be established. With respect to the latter action, Keane CJ, Bennett and Gordon JJ (of the Federal Court of Australia) applied Carey-Hazell v Getz Bros & Co (Aust) Pty Ltd (2004) ATPR ¶42-014; [2004] FCA 853 at [186], endorsing (at [191]) the determination that s 75AC ‘is an objective standard based upon what the public at large, not any particular individual, is entitled to expect’ and that s 75AC ‘does not require goods to be absolutely free from risk. Rather, the level of safety required is that which the community is entitled to expect’. Their Honours agreed (at [201]) with the trial judge’s findings: Vioxx had a defect within the meaning of s 75AC. The defect was one which affected some people, not all. The defect was that in some people, by a mechanism not known and the subject of no hypothesis, it increased the risk of MI and provided no information, advice or warning as to this effect … Even though the claim failed because causation could not be proven on a balance of probabilities, their Honours went on to consider whether or not s 75AK, the state-of-theart defence, would relieve the respondent of liability (had causation been established). Finding in favour of the drug company, the Full Court held that the identified defect was not able to be discovered having regard to the state of scientific or technical knowledge at the time the goods were supplied. The court held (at [208]): … the state of scientific knowledge at the time Mr Peterson took Vioxx was such that it was not demonstrated that Vioxx caused an increased risk of MI. As the primary judge said (at [929]): Section 75AK(l)(c) contemplates the existence of a defect capable of being discovered by reference to the current state of scientific or technical knowledge. It is not concerned with the kind of contextual circumstances referred to in s 75AC(2) … The defect was something inherent in Vioxx as a matter of composition. I consider that the intent of s 75AK(1)(c) is that if

that defect could not be discovered according to the state of scientific or technical knowledge, the defence should be available, notwithstanding that enough was suspected about the product to activate an implied obligation to give warnings of the kind mentioned in s 75AC(2)(d).

[page 30] In Fulcher v Knott Investments Pty Ltd [2012] QSC 232, a case concerning a defective Winnebago vehicle and the destruction of a tomato farm by fire, the Queensland Supreme Court upheld the plaintiffs’ claims under Pt VA of the Trade Practices Act 1974 (Cth). However, the nature of the damages awarded by virtue of the Act was limited. The court in Fulcher applied the leading case, Glendale Chemical Products Pty Ltd v Australian Competition and Consumer Commission. Questions regarding mitigation of damages and causation were considered on appeal, in Knott Investments Pty Ltd v Fulcher [2014] 1 Qd R 21; [2013] QCA 67 (see 4.41). In response to the recommendations of the Ipp Panel, as a solution to the ‘insurance crisis’ (see 2.13), Pt VA was amended in 2004 by the Trade Practices Act 2004 (Cth) Pt VIB, to limit the damages that can be awarded to a successful litigant. For example, thresholds were introduced with respect to non-economic loss (such as pain and suffering) as were ceilings ($250,000, indexed). A ceiling was also imposed on claims for loss of earning capacity (at two times average weekly earnings) (see Chapter 12). The limitation period in which a suit can be lodged was also amended under that Part. These changes are now part of the Australian Consumer Law.

Statutory interventions and restrictions on damages awards (prior to 2002–03) 1.24 For several years, a number of jurisdictions have legislated to impose ceilings on the damages or amount of compensation a plaintiff can recover in a common law action in the tort of negligence, most commonly in motor vehicle and workplace contexts. The purpose of

this type of legislative intervention is to ensure that fault-based compensation paid to an injured person is kept within limits that are economically manageable and viable for the state-run liability insurer. These provisions do not, however, create no-fault compensation schemes or entitlements. Rather, they impose limitations on common law principles, within the framework of common law actions. Restrictions of this nature have been extended (especially since 2002) to apply more generally, in contexts beyond negligence actions related to workplace and transport accidents (noted previously — see 1.18). This was one of the most significant components of the states’ and territories’ responses to the litigation/‘liability insurance crisis’ (as it has been described by the insurance industry, politicians, the media and some commentators). Also note the tables in Chapter 12, which compare important general limitations placed by each state and territory on damages awards for personal injury. These restrictions are relevant to all personal injury damages awards, except where otherwise specifically excluded — for example, where special statutory modifications to the common law have been preserved under workplace or motor vehicle regimes (see 1.18) or other contexts have been singled out for special treatment or exemption (such as intentional acts, sexual assault or sexual misconduct: see Wrongs Act 1958 (Vic) s 28C). [page 31]

Choice of Law/Conflict of Laws and Legislative Interventions 1.25 When the law of torts was principally the common law, it was largely the same in all Australian jurisdictions, as there is only one common law for the whole of Australia, rather than separate common laws in each state and territory: see Lipohar v R (1999) 200 CLR 485 at 507–8; 168 ALR 8 at 20–1 per Gaudron, Gummow and Hayne JJ. The

legislative changes made by states and territories in the first decade of this century, discussed above, have produced the result that no two Australian jurisdictions now have exactly the same law of torts. What law should a court apply when considering a case arising out of an incident that occurred in another Australian jurisdiction? Should it apply its own law or the law of the place where the (alleged) wrongful act or omission took place? The answers to that question are to be found in another subject, usually called ‘Conflict of Laws’ or (sometimes) ‘Private International Law’, which is concerned with (among other things) the rules governing choice of law — literally, how the court chooses which law to apply to the case before it. The High Court of Australia stated the following choice of law rule for intra-Australian tort cases in John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503; 172 ALR 625 at [102] per Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ: The lex loci delicti [the law of the place of the wrong] should be applied by courts in Australia as the law governing all questions of substance to be determined in a proceeding arising from an intranational tort.

At first sight, it may seem as though this test provides a clear and simple answer to our question about what law the court should apply when considering an alleged tort that occurred in another jurisdiction. However, in applying this rule, the court must still decide whether the question before it is a ‘question of substance’. Questions of procedure are governed by the law of the forum: that is, the law of the state or territory where the court sits. The court in John Pfeiffer stated the following ‘guiding principle’ for distinguishing between questions of substance (which are governed by the law of the place of the wrong) and questions of procedure (which are governed by the law of the place where the court sits) (at [99]): [M]atters that affect the existence, extent or enforceability of the rights or duties of the parties to an action are matters that, on their face, appear to be concerned with issues of substance, not with issues of procedure. Or … ‘rules which are directed to governing or regulating the mode or conduct of court proceedings’ are procedural and all other provisions or rules are to be classified as substantive.

Which of the statutory rules considered in this book would qualify

as rules of substance according to this test, and which would be procedural rules? For example, what about the rule we will consider in 4.28–4.29, which requires the court to ignore the plaintiff’s own evidence when deciding questions of factual causation? Questions of admissibility of evidence are usually considered to be procedural, because they are concerned with ‘regulating the mode or conduct of [page 32] court proceedings’ by allowing or excluding some kind of testimony. However, excluding the plaintiff’s evidence about what she or he would have done can clearly be ‘outcome determinative’ (to use another phrase often used in the conflict of laws), because it can affect the court’s decision about the existence of the plaintiff’s right to recover damages. That makes it look more substantive than procedural. Although this question of characterisation may seem rather abstract, it has very important practical consequences. If the alleged wrong occurred in New South Wales, Queensland, Tasmania or Western Australia but the action is being heard in the Australian Capital Territory, the Northern Territory, South Australia or Victoria, the court must exclude the plaintiff’s evidence if the rule is substantive but allow it if the rule is procedural. If the rule is procedural, a plaintiff injured in New South Wales has an obvious reason to want to sue in the Australian Capital Territory or Victoria, rather than in New South Wales. To take another example, what about the statutory presumptions of contributory negligence on the part of intoxicated plaintiffs, which we consider in 10.36–10.45. Obviously, they can affect the amount of damages an intoxicated plaintiff can recover, which makes them appear substantive. However, it is arguable that a rebuttable presumption, like a rule of evidence, is merely a procedural rule that

shapes the way the plaintiff’s case must be presented to the court. Again, the court’s characterisation of the nature of the relevant statutory rule has great practical significance, given the considerable differences that exist between the legislation in different jurisdictions. The courts must grapple with how the Pfeiffer substance/procedure distinction affects choice of law in intra-Australian torts cases, especially in the light of the wave of civil liability legislation, discussed in Chapter 2 and throughout this book. The examples considered here are just two of many that can arise in practice, when the choice of law will add yet another layer of complexity to what has already become a very complex maze of legal principles. As I (Martin) wrote elsewhere: By creating such a fertile source of disagreement, the patchwork nature of the civil liability legislation has opened up a new chapter in intra-Australian conflict of laws. That is the price that must be paid for ignoring the Ipp Report’s first recommendation, that uniform legislation be passed in each state and territory.41

Our Journey 1.26 Learning about and applying tort principles has become increasingly complex. We hope to make that journey as accessible as possible, but without sacrificing the need to understand the sometimes complex and seemingly ever-changing interaction of statute and common law principles. [page 33]

Discussion 1. The Report of the National Committee of Inquiry into Compensation and Rehabilitation in Australia 1974 (the Woodhouse Report) said that compensation for injuries is really ‘a charge upon the community’: see p 73 (para 164). Is a governmentfunded system of compensation, in conjunction with the abolition

of the common law right to sue, the most appropriate means of dealing with the problems that arise as a result of death and personal injury? 2. Do you think the NDIS and NIIS are desirable initiatives? Revisit this question after you have completed your studies in torts, to see if your views have changed. 3. How should the Australian community respond to the claims of the Stolen Generations? Which is more suitable — a legal response, or a response that is political in nature, or a combination of both?

Further reading Accident Compensation Symposium, ‘Accident Compensation: 40 Years On — A Celebration of the Woodhouse Report (Compensation for Personal Injury in New Zealand, Report of the Royal Commission of Inquiry)’ [2008] New Zealand Law Review 1. Balkin R P and Davis J L R, ‘General Observations’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 1. —, ‘Compensation in Personal Injury Actions’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 11. —, ‘Alternative Sources of Compensation for Personal Injuries’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 12. Barker K, Cane P, Lunney M and Trindade F, ‘Introduction: Torts and Tort Law’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 1. Cane P, ‘Reforming Tort Law in Australia: A Personal Perspective’ (2003) 27 Melbourne University Law Review 649. Cullen J et al, ‘Will the National Disability Insurance Scheme Improve the Lives of Those Most in Need? Effective Service Delivery for People with Acquired Brain Injury and other Disabilities in Remote Aboriginal

and Torres Strait Islander Communities’ (2004) 73 Australian Journal of Public Administration 260. Davies M, ‘Choice of Law after the Civil Liability Legislation’ (2008) 16 Torts Law Journal 104. Kune R, ‘The Stolen Generations in Court: Explaining the Lack of Widespread Successful Litigation by Members of the Stolen Generations’ (2011) 30 University of Tasmania Law Review 32. [page 34] Luntz H, ‘Compensation Recovery and the National Disability Insurance Scheme’ (2013) 20 Torts Law Journal 153. Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Accident Compensation and the Law of Torts’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 1. —, ‘Particular Negligence Situations’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 7. Madden B, McIlwraith J and Brell R, The National Disability Insurance Scheme Handbook, LexisNexis Butterworths, Sydney, 2014. Malkin I, ‘Tort Law’s Role in Preventing Prisoners’ Exposure to HIV Infection While in Her Majesty’s Custody’ (1995) 20 Melbourne University Law Review 423. Malkin I and Wright J, ‘Product Liability under the Trade Practices Act: Adequately Compensating for Personal Injury?’ (1993) 1 Torts Law Journal 63. Mann N and Mitchell E, ‘DisabilityCare?: The NDIS So Far’ (2013) 116 Precedent 4. Rae M, ‘When Reconciliation Means Reparations: Tasmania’s Compensation to the Stolen Generations’ (2015) 24 Griffith Law Review 640.

Rijswijk H V and Anthony T, ‘Can the Common Law Adjudicate Historical Suffering?’ (2012) 36 Melbourne University Law Review 618. Smillie J, ‘The Future of Negligence’ (2007) 15 Torts Law Journal 302. Spigelman J J, ‘Negligence: The Last Outpost of the Welfare State’ (2002) 76 Australian Law Journal 432. Todd S, ‘Negligence Liability for Personal Injury: A Perspective from New Zealand’ (2002) 25 University of New South Wales Law Journal 895. White S and Bailey A, ‘Defective Goods Revisited: “Safety Defect” under the Australian Consumer Law’ (2013) 24(2) Australian Product Liability Reporter 23.

1

2

3 4 5 6

7 8 9 10

For a discussion of the New Zealand reforms and a comment on the need for a comprehensive no-fault compensation scheme, see S Todd, ‘Negligence Liability for Personal Injury: A Perspective from New Zealand’ (2002) 25 University of New South Wales Law Journal 895; H Luntz, ‘Reform of the Law of Negligence: Wrong Questions — Wrong Answers’ (2002) 25 University of New South Wales Law Journal 836; Accident Compensation Symposium, ‘Accident Compensation: 40 Years On — A Celebration of the Woodhouse Report “Compensation for Personal Injury in New Zealand, Report of the Royal Commission of Inquiry”’ [2008] New Zealand Law Review 1–140. For a comprehensive discussion of the schemes, see H Luntz, ‘Compensation Recovery and the National Disability Insurance Scheme’ (2013) 20 Torts Law Journal 154. See also H Luntz, D Hambly, K Burns, J Dietrich and N Foster, ‘Accident Compensation and the Law of Torts’ in Torts: Cases and Commentary, 7th ed, LexisNexis Butterworths, Sydney, 2013, Ch 1. See, for example, (accessed 20 June 2017). B Madden, J McIlwraith and R Brell, The National Disability Insurance Scheme Handbook, LexisNexis Butterworths, Sydney, 2014, p 15. National Disability Insurance Scheme (Supports for Participants — Accounting for Compensation) Rules 2013 r 1.1. The NDIS Act is supplemented by National Disability Insurance Scheme Rules. They cover matters such as becoming a participant, children, plan management, and protection and disclosure of information. Section 209 of the NDIS Act creates the power for the minister to make various rules prescribing matters required or permitted by the Act to be prescribed by the NDIS rules. See NDIS Act ss 24, 25. See NDIS Act s 25. See note 4 above, p 41. National Disability Insurance Scheme (Supports for Participants) Rules 2013 Sch 1. See

11 12 13

14 15 16 17 18

19

20 21 22 23 24 25 26 27 28

29

30

also individualised items described in the Productivity Commission Report, pp 22–3. ‘Compensation’ is defined in NDIS Act s 11. NDIS Act ss 104, 105. The Australian Government is currently working with states and territories to develop the NIIS as a federated model of separate schemes: see (accessed 20 June 2017). See (accessed 20 June 2017). See H Luntz et al, note 2 above, pp 63–5. See (accessed 20 June 2017). See note 15 above. See (accessed 20 June 2017). See also National Injury Insurance Scheme (Queensland) Act 2016 (Qld). The website uses the term ‘serious personal injury’, but this is defined in the same way as ‘catastrophic injury’. Motor Vehicle Accidents (Lifetime Support Scheme) Act 2013 (SA); Lifetime Care and Support (Catastrophic Injuries) Act 2014 (ACT); Motor Vehicle (Catastrophic Injuries) Act 2016 (WA). The Motor Accidents (Compensation) Act 1979 (NT) was amended by the Motor Accidents (Compensation) Amendment Act 2014 (NT), aligning the Act with the minimum benchmarks under the NIIS. Motor Accidents (Compensation) Act 1979 (NT); Motor Accidents (Liabilities and Compensation) Act 1973 (Tas); Transport Accident Act 1986 (Vic). Motor Accidents (Lifetime Care and Support) Act 2006 (NSW); Motor Accidents Compensation Amendment Act 1999 (NSW). Motor Accidents (Compensation) Act 1979 (NT) s 5. Motor Accidents (Liabilities and Compensation) Regulations 2010 (Tas) Sch 1. American Medical Association, Guides to the Evaluation of Permanent Impairment, 4th ed, American Medical Association, Chicago, 1995. This was amended by the Motor Accident Compensation Act 1999 (NSW). New South Wales Legislative Assembly, Hansard, 9 March 2006, p 21400. Motor Vehicles Act 1959 (SA) s 127B. Safety, Rehabilitation and Compensation Act 1988 (Cth); Seafarers Rehabilitation and Compensation Act 1992 (Cth); Workers Compensation Act 1951 (ACT); Workers Compensation Act 1987 (NSW); Workplace Injury Management and Workers Compensation Act 1998 (NSW); Return to Work Act 2016 (NT); Workers’ Compensation and Rehabilitation Act 2003 (Qld); Return to Work Act 2014 (SA); Workers Rehabilitation and Compensation Act 1988 (Tas); Workplace Injury Rehabilitation and Compensation Act 2013 (Vic); Workers’ Compensation and Injury Management Act 1981 (WA). Victims of Crime (Financial Assistance) Act 2016 (ACT); Victims Rights and Support Act 2013 (NSW); Victims of Crime (Assistance) Act 2006 (NT); Victims of Crime Assistance Act 2009 (Qld); Victims of Crime Act 2001 (SA); Victims of Crime Assistance Act 1976 (Tas); Victims of Crime Assistance Act 1996 (Vic); Criminal Injuries Compensation Act 2003 (WA). For more information on the scheme in Western Australia see (accessed 20 June 2017).

31

32

33

34 35 36

37 38

39 40

41

For more information on the scheme in South Australia see (accessed 20 June 2017). For more information on the scheme in New South Wales see

(accessed 20 June 2017). For more information about the Queensland scheme see (accessed 20 June 2017). I Malkin, ‘Tort Law’s Role in Preventing Prisoners’ Exposure to HIV Infection While in Her Majesty’s Custody’ (1995) 20 Melbourne University Law Review 423. ‘Justice for Stolen-Gen Victim’ (The Age, 24 June 2011); ABC News 2010, ‘Apology for Member of Stolen Generations’, ABC1, Sydney, 24 June. In 2008, Western Australia instituted the ‘Redress Scheme’ for ‘forgotten persons’, including members of the Stolen Generations. To qualify, applicants had to have suffered ‘very severe abuse and/or neglect with ongoing symptoms and disability’. In its 2010–11 annual report, the Western Australia Department for Communities described it as ‘a finite scheme to acknowledge and apologise to adults who, as children, were abused and/or neglected while they were in the care of the state’. The scheme offered apologies, counselling services and ex gratia payments ($5,000 minimum; $45,000 maximum). In 2010, an action was instituted on behalf of nine Indigenous persons who had been removed from their families, in Western Australia. Part VIB, concerning limits on damages, was introduced into the Trade Practices Act 1974 (Cth) in 2004 and is now included in the Australian Consumer Law: see 1.22–1.23. Civil Law (Wrongs) Act 2002 (ACT) s 24; Compensation to Relatives Act 1897 (NSW) s 3(1); Compensation (Fatal Injuries) Act 1974 (NT) s 7; Civil Proceedings Act 2011 (Qld) s 64; Civil Liability Act 1936 (SA) s 23; Fatal Accidents Act 1934 (Tas) s 4; Wrongs Act 1958 (Vic) s 16; Fatal Accidents Act 1959 (WA) s 4. Product Liability (Australian Law Reform Commission report no 51/Law Reform Commission of Victoria report no 27, 1990). See I Malkin and J Wright, ‘Product Liability under the Trade Practices Act: Adequately Compensating for Personal Injury?’ (1993) 1 Torts Law Journal 63; M Hammond, ‘The Defect Test in Part VA of the Trade Practices Act 1974 (Cth): Defectively Designed?’ (1998) 6 Torts Law Journal 29. M Davies, ‘Choice of Law after the Civil Liability Legislation’ (2008) 16 Torts Law Journal 104 at 119.

[page 35]

2 Overview of Negligence Objectives After completing this chapter, you should: — understand the fundamental elements comprising the tort of negligence; — understand the impact of the Ipp Panel and its recommendations; — be able to critically evaluate the rationale for some of the Ipp Panel’s recommendations; — understand, in general terms, ways in which some jurisdictions’ statutory changes were influenced by the Ipp Panel recommendations; — understand the significant ways in which the common law interacts with Ipp Panelinfluenced statutory provisions at particular points in the negligence framework; — understand how to structure arguments, based on the main elements of the tort of negligence, when presented with a new fact situation.

Key cases — Adeels Palace v Moubarak (2009) 239 CLR 420; 260 ALR 628 — Bugge v Brown (1919) 26 CLR 110 — Caltex Refineries (Qld) Pty Ltd v Stavar (2009) 75 NSWLR 649

— Donoghue v Stevenson [1932] AC 562 — Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; 194 ALR 337 — Hollis v Vabu Pty Ltd (t/as Crisis Couriers) (2001) 207 CLR 21; 181 ALR 263 — Rogers v Whitaker (1992) 175 CLR 479; 109 ALR 625 — Sharman v Evans (1977) 138 CLR 563; 13 ALR 57 — Strong v Woolworth Ltd t/as Big W (2012) 246 CLR 182; 285 ALR 420 — Sullivan v Moody (2001) 207 CLR 562; 183 ALR 404 [page 36] — Wallace v Kam (2013) 250 CLR 375; 297 ALR 383 — Wyong Shire Council v Shirt (1980) 146 CLR 40; 29 ALR 217

Key legislative developments — All jurisdictions have enacted Civil Liability or Wrongs Acts provisions in response to the Ipp Panel Report’s recommendations.1

Introduction 2.1 As we noted in Chapter 1, the law of torts is concerned with the protection of personal, property and economic interests. It allocates losses primarily by requiring the person who wrongfully invades a legally protected interest to make monetary compensation to the person harmed. A tort claim or private civil action essentially involves an aggrieved person instituting proceedings seeking a remedy in damages. These days, the most commonly litigated action is the tort of

negligence, revolving around the alleged carelessness of the defendant. Of course, this will depend on whether or not the circumstances (roughly) fit the elements of the cause of action. There are a number of objectives for instituting civil proceedings in negligence. The one that is cited most frequently is the provision of damages or compensation to place the injured person back in the position she or he would have been in had the tort not occurred. While compensation often tends to be a primary consideration, there are said to be additional objectives that can be served by the institution of civil proceedings in tort, as well as theories about their value to society. For example, deterrence is also one of the traditional objectives of a negligence action despite the effect third party liability insurance has on the defendant’s personal responsibility (in many contexts). Additional rationales for resisting the diminishing role of negligence include its ability to provide corrective justice and appeasement, its capacity to empower claimants and its potential role in accident prevention and education, whereby it might lead to raised standards and modified behaviour. In fact, not all commentators agree that these are necessarily negligence law’s true objectives. A given claim may only satisfy some of these purported objectives. It could be argued that it is not possible for the tort of negligence to both compensate a plaintiff and properly deter the defendant by the payment of a single sum. Arguably, potential deterrence could be well served by the institution of civil proceedings in torts such as battery; it is difficult to assess whether that objective would be served in many negligence contexts. In some contexts, with certain types of defendants, the suggestion that a negligence action could produce higher standards of behaviour is more credible than others. For example, doctors or manufacturers may well change their practices as a result of a negligence action. By way of [page 37]

contrast, most commentators would concede that negligence suits do not have this modifying effect on drivers’ conduct, unlike a criminal prosecution, which is a much more effective mechanism for regulating that type of conduct. However, in all cases, even those defendants who successfully defend claims (and those like them) may behave differently in future as a direct consequence of having to defend these actions. Similarly, even the threat of negligence litigation may have a positive regulatory effect. During 2002–03, all Australian jurisdictions changed many significant aspects of negligence doctrine that had been developed by the judiciary at common law, by enacting a large number of statutory provisions. In doing so, these provisions direct courts (to varying degrees) as to what they may and may not consider when deciding cases. Although every jurisdiction has enacted statutes to decrease the number of liability claims, some are more draconian than others in their effect. For example, at almost every juncture, the Civil Liability Act 2002 (NSW) makes it much more difficult to litigate successfully in New South Wales, compared with the equivalent Victorian statute, the Wrongs Act 1958 (Vic). Many (but not all) of these provisions are either derived from or connected to the Ipp Panel’s Review of the Law of Negligence. A number of the statutory changes are based on the Ipp Panel’s concern that personal injury law should have several additional aims: •

encouraging personal responsibility;

•

reducing the community’s ‘culture of blame’;

•

reining in tort awards;

•

making insurance affordable.

A detailed discussion of these changes and what led to their introduction begins at 2.13, after we first outline the fundamental elements of the tort of negligence. Because this is an outline — an overview — we have quite deliberately avoided the inclusion of references to a large number of statutory provisions and case law

principles. A detailed consideration of those sources, in the context of a more nuanced discussion, is included in subsequent chapters.

Elements of the Tort of Negligence Legally recognised damage (or harm) must be suffered 2.2 There is a long-standing principle that states, ‘damage is the gist of a negligence action’ (see Harriton v Stephens (2006) CLR 52; 226 ALR 391 at [251]): to be actionable, the law requires that the plaintiff or claimant suffer (and prove) actual damage for an action in negligence to be available. A minimum amount of damage is required. This is encapsulated in the maxim, de minimis non curat lex. Because damage is the gist of negligence, the cause of action is not complete until the harm is present. Therefore, the action cannot be instituted in the abstract, where a plaintiff might argue that she or he will, in future, suffer harm if certain measures are not introduced. The damage must amount to ‘legally recognised harm’. The [page 38] elements of the action that must be proven to succeed in a common law negligence action are: •

duty of care: the defendant owes the plaintiff, who suffers legally recognised harm or damage, a duty to take care;

•

breach: the defendant’s conduct breaches the duty owed to the plaintiff, by not satisfying the standard of care expected of the reasonable defendant in the circumstances. This is the ‘fault’ element of the tort, assessed on the basis of reasonableness;

•

causation: the breach is a factual cause of the harm; it is a reasonably foreseeable type of harm that is not too remote (within the scope of the defendant’s liability);

•

no defences: no defence applies (if contributory negligence applies, it reduces damages).

Negligence allows a plaintiff to bring legal proceedings against a defendant without proof of deliberate intent. Legally established carelessness suffices.

Our pedagogy/structure 2.3 In this book, we begin our in-depth discussion of the tort of negligence with an assessment of what are traditionally treated as the second and third elements of this tort — breach and causation. The reason for analysing those elements prior to exploring the duty of care requirement is pedagogical. We believe that reasonable care is a relatable place to start a consideration of the tort of negligence because most of us have a basic pre-existing sense of what is careful behaviour and what is careless behaviour, a concept that remains relatively concrete. On the other hand, starting with the abstractions of the duty of care principle, the traditional first element in the tort of negligence is, in our view, problematic. The rather complex and relatively abstract consideration of ‘salient features’ is the basis on which the duty of care requirement is now determined. We believe that a discussion of duty principles should follow an examination of reasonable care, a concept that is, by comparison, more readily understandable and accessible. Interestingly, the High Court of Australia itself does not always follow the traditional structure, even when the duty of care issue is the critical one. For example, in the leading case, CAL (No 14) Pty Ltd t/as Tandara Motor Inn v Motor Accidents Insurance Board (2009) 239 CLR 390; 260 ALR 606, the High Court canvassed breach and causation issues prior to analysing the contentious legal question — whether or not a duty of care was owed. Indeed, in Cole v South Tweed Heads Rugby League Football Club Ltd (2004) 217 CLR 469; 207 ALR 52, Hayne and Gummow JJ decided to avoid discussion of the contentious duty question, because in their view doing so was not necessary, as they

had rejected the claim on the basis that the breach and causation elements had not been satisfied. [page 39]

Breach of the Duty to Take Care: The Standard of Care Expected of the ‘Reasonable Person’ The calculus of negligence at common law and under statute 2.4 In traditional approaches, the second main element of the tort of negligence involves assessing the standard of care and whether or not there has been a factual breach of the duty to take care. Owing someone a duty of care is not sufficient to establish liability. Liability attaches only to the breach of that duty when it causes harm that is not too remote. This involves an examination of the standards of behaviour that are acceptable or unacceptable when a defendant goes about their business or embarks on a course of conduct. In reality, most cases turn on determining breach — whether or not the defendant’s conduct discharged the duty to take care. In this way, a negligence action can act as a regulator or as a risk management device. The plaintiff must identify and prove a specific failure by the defendant. In many cases, more than one failure is alleged. If proven, the failure must be later considered in the context of causation (discussed below) — that is, did the specific breach cause the plaintiff harm? According to the leading United Kingdom (UK) case, Blyth v Birmingham Waterworks Co (1856) 11 Exch 781, negligence is (i) the omission to do something which a reasonable person, guided upon those considerations which ordinarily regulate the conduct of human affairs, would do; or (ii) doing something which a prudent and reasonable person would not do. Doing one’s best is not (necessarily)

good enough. In every case, the plaintiff must prove that the defendant did not act as a reasonable person in the circumstances would have acted. If the defendant falls short of that standard, regardless of the size of the failure, a breach occurs. At common law in Australia, the way in which courts determine the standard of care in any given situation is governed by Mason J’s decision in the leading High Court of Australia case, Wyong Shire Council v Shirt (1980) 146 CLR 40; 29 ALR 217. The first matter that must be established is that the risk of injury was foreseeable to the reasonable person. If this is satisfied, the court must consider the socalled ‘negligence calculus’. That is, the court must consider all of the factors which would influence a reasonable person determining whether or not to take precautions to avoid the risk of injury manifesting itself. At common law, these factors are: •

the probability of the risk materialising;

•

the gravity of the harm if it were to materialise;

•

the practicability of precautions;

•

the social utility (or ‘justifiability’) of the defendant’s conduct;

•

other factors, such as any conflicting responsibilities.

Justice Mason’s judgment in Wyong Shire Council v Shirt has been cited hundreds (if not thousands) of times, as the basis on which breach determinations are made. Even when it is not explicitly cited, the rationale and logic of his approach is implicit [page 40] in breach and standard of care determinations. As was noted earlier, as one of the responses to the ‘insurance crisis’ in 2002–03, most legislatures intervened in the common law, prescribing the way in which courts must resolve personal injury cases. As a result, the

framework for assessing the standard of care has now been set out by the legislature (in most cases). Most jurisdictions’ Civil Liability Acts (not the Northern Territory) changed one aspect of Mason J’s decision in Wyong Shire Council v Shirt but mirrored most of the other aspects of his approach. At common law, Mason J stated that a foreseeable risk is one that is ‘not farfetched or fanciful’. The civil liability statutes now prescribe that the risk must be a ‘not insignificant’ risk. This change has not had a major impact. Under the statutes, once the plaintiff satisfies this preliminary hurdle, the Acts’ provisions require the court to consider factors that are roughly equivalent to the common law ‘calculus’ — all the factors which would influence a reasonable person in determining whether or not to take precautions to avoid the risk of injury manifesting itself. The statutes include the common law standard of care requirements: the probability that the harm would occur if care were not taken, the likely seriousness of the harm should it materialise, the burden of taking precautions to avoid the risk of harm and the social utility of the activity that creates the risk of harm.

The reasonable person: modifications to the objective standard 2.5 The standard of care expected of the defendant is objective. In the usual case, the conduct of the defendant is compared to that of the ordinary, reasonably prudent person: what would she or he have done (if anything) to avoid the risk of injury to another? However, some characteristics or attributes of particular classes of defendant are taken into account in special situations. A classic example is that of children, where the objective standard of care is modified lower. Another classic context involves professionals acting in a professional capacity. For many years, there had been judicial and academic controversy about the basis on which doctors’ allegedly wrongful conduct was to be judged. Should the doctor be able to defend a claim by saying she or he did what others in her or his profession would have done? Or, rather, should the court maintain the right to make that determination

— ultimately a question of ‘reasonableness’? Arguably, the practice of a profession such as medicine presents extra problems for a court, because the judge or jury will not be experts in the field of the professional, and will be required to rely upon expert evidence in order to determine what the defendant should have done or not done. For example, when determining whether there was negligence in treating a patient with cancer, the court requires evidence of the appropriate types of alternative treatments, such as chemotherapy, radiation and surgery. English courts relied quite heavily upon the evidence of medical professionals when determining proper levels of skill and care. The argument was that, under the so-called ‘Bolam test’, the courts left it to the profession to determine the standard of skill and care required. The defendant would not be negligent if there was a responsible body of medical opinion which stated that the conduct of the defendant was proper. The courts would not substitute their own opinions of what was proper for that of the profession. In Australia, the use to be made of expert evidence was [page 41] ‘settled’ at common law in the High Court of Australia case, Rogers v Whitaker (1992) 175 CLR 479 at 487; 109 ALR 625 at 631, where the court held that: [T]he standard of care to be observed by a person with some special skill or competence is that of the ordinary skilled person exercising and professing to have that special skill. … But, that standard is not determined solely or even primarily by reference to the practice followed or supported by a responsible body of opinion in the relevant profession or trade. … [W]hile evidence of acceptable medical practice is a useful guide for the courts, it is for the courts to adjudicate on what is the appropriate standard of care after giving weight to ‘the paramount consideration that a person is entitled to make his own decisions about his life’.

In a later High Court of Australia case, Naxakis v Western General Hospital (1999) 197 CLR 269; 162 ALR 540, it was made clear that the Rogers v Whitaker principle extended to cover diagnosis and treatment.

The legislative interventions into the common law, around 2002–03, are particularly noteworthy in this context.2 In most jurisdictions, these changes govern all ‘professionals’. However, Western Australia confines the changes to ‘health professionals’, as recommended by the Ipp Panel. In the case of persons who have ‘particular skills’, such persons are to be measured against the standard of what could reasonably be expected of persons possessing the particular skill at the time of the alleged negligence. The legislative changes do not equate skill with conformity to regular practice. Rather, they determine the standard as being what could reasonably be expected of persons of skill. The court must determine what could reasonably be expected of such persons. In general terms, the conduct will not be considered negligent if it complies with ‘peer professional opinion’. The practice need not be universally accepted to be widely accepted, and justifiably relied upon. The court has the final say in determining negligence if the practice is ‘unreasonable’ (Victoria), ‘irrational’ (New South Wales, Queensland, South Australia and Tasmania) or ‘so unreasonable that no reasonable health professional would have followed it’ (Western Australia). It should further be noted that the peer professional opinion provisions do not offer this type of excuse or protection in the context of information provision, advice or warnings. In these circumstances, the Rogers v Whitaker common law principle applies.

Consequences of a breach finding 2.6 Finding a breach of the duty of care and establishing the relevant standard of care are tied closely to the facts of the immediate case. Finding that liability in one case is established does not mean there will necessarily be liability in another case involving similar facts. For example, finding a breach because there was no sign warning of the risk of slipping at one venue does not mean that the absence of a sign at another venue with a slippery floor will necessarily amount to a breach. The court, as fact-finder, makes an assessment of the

reasonableness of the defendant’s conduct in the circumstances of the case. [page 42] In this way, the breach decision is tied closely to the facts of the particular case and is not of precedential value; that aspect of the decision is not binding. However, similarly placed defendants who have an interest in the findings of the earlier case may nevertheless adjust their behaviour because of what the court decided. In a sense, they could be ‘regulated’ by the tort claim or case, because they fear potential liability and the payment of damages awards. Finally, although the actual breach determinations are not binding, underlying principles may emerge from the case that are of precedential effect, such as whether or not child defendants should be held to the same standard of care as adults, and what is a ‘material risk’ in medical negligence claims.

Cause Harm that is Not Too Remote 2.7 To establish the defendant’s liability in negligence, the defendant must have breached their duty to take care and, in doing so, caused damage to the plaintiff that is not too remote a consequence of the breach. Civil liability legislation now provides a general framework within which the causation inquiry must be determined (except in the Northern Territory). Ultimately, in the tort of negligence, causation issues arise in the context of evaluating whether or not responsibility should be attributed to the defendant. As emphasised by the High Court of Australia in Wallace v Kam (2013) 250 CLR 375; 297 ALR 383, and by the Civil Liability Acts, there is a normative element to this determination; the second limb of the statutory framework is clearly concerned with policy considerations. The initial requirement is the establishment of ‘factual causation’. The test used is one of causal necessity. This counter-factual test is

intended to determine whether or not, on a balance of probabilities, the damage would have been sustained without the defendant’s breach. The court asks, did the defendant’s breach ‘make a difference’? In other words, was it a ‘necessary condition’ of the occurrence of the harm? Significant High Court of Australia decisions considering what is required to prove factual causation include Adeels Palace v Moubarak (2009) 239 CLR 420; 260 ALR 628 and Strong v Woolworths Ltd t/as Big W (2012) 246 CLR 182; 285 ALR 420. It is well recognised that this ‘necessary condition’ test has its limitations: for example, it does not always provide a sensible result in a range of instances, including those of evidential uncertainty and of causal over-determination. Several common law cases and the Civil Liability Acts contemplate and address these types of problematic circumstances. Establishing factual causation does not suffice to establish causation for the purposes of attributing legal responsibility in the tort of negligence. In accordance with the statutory framework, reflecting the essence of the common law approach, the court must address policy questions: whether or not and why responsibility for the harm should be imposed on the negligent party, and whether it is appropriate for the scope of the defendant’s liability to extend to responsibility for this harm. According to Wallace v Kam, this raises a policy question involving a ‘rule of responsibility’. [page 43] In determining whether or not a consequence is within the scope of liability, the court must consider whether there are any new intervening acts (novus actus interveniens) that relieve the defendant of responsibility by breaking the link between the breach and harm. The scope of liability provision also embraces ‘remoteness of harm’ considerations: to be held responsible, the defendant must foresee ‘harm of the same kind’ as that suffered by the plaintiff (Overseas

Tankship (UK) Ltd v Morts Dock and Engineering Co Ltd (The Wagon Mound (No 1)) [1961] AC 388). That said, the defendant need not have foreseen the extent of the harm to be held liable, nor the precise manner in which it occurred. Further, the defendant has to ‘take the plaintiff as found’, with her or his physical and psychological constitutions (although cases on point are often strongly contested and have, in certain circumstances, been modified by statutory provisions).

Duty to Take Care 2.8 Traditionally, because the defendant does not owe a legal duty to the world at large, the first element of the tort of negligence that must be satisfied is whether or not the defendant owes the plaintiff a duty to take reasonable care for the safety of the plaintiff’s interests. The duty of care involves the legally recognised relationship between parties as a result of which one is said to have responsibilities to the other, such that care must be reasonably taken. This relationship arises even though the parties are strangers to each other. The starting point is to ascertain whether a relevant established category of duty of care exists. A number of established categories of duty exist. They include relationships between manufacturer and consumer, road users, employer and employee, school and pupil, and doctor and patient. With respect to these types of relationship, the existence of a legal duty of care between plaintiff and defendant is usually not disputed. However, even among these established categories of duty, there may be some uncertainty as to the precise boundaries. For example, although a driver’s duty to a passenger in most circumstances is clear, even establishing this duty can be controversial — does a mother owe a duty of care to her foetus when driving? As a rough indication, if a person sustains bodily injury or property damage as a result of a direct impact from the positive act of another, establishing a duty of care on the person who caused the impact will usually be uncontroversial. In other situations, a thorough inquiry into the existence of duty may be required. Conceptually, these ‘hard’ cases

can often involve a particular type of defendant, such as a public authority, or cases where the harm suffered consists of purely economic loss or mental harm that is not consequential. Difficult cases also involve ones where the loss flows from a ‘pure omission’, and contexts involving the control of the conduct of a third party. In those types of cases, the task of proving the existence of a duty of care can be burdensome. Statutory regimes have affected claims involving mental harm and the establishment of the duty to take care. They also have affected claims involving public authority defendants in various ways in most jurisdictions. [page 44] Courts and commentators frequently debate how to identify the principles which determine the existence of a duty of care in novel or contentious circumstances. Arguably, they should reflect prevailing social values. In the leading decision, Donoghue v Stevenson [1932] AC 562, Lord Atkin emphasised the importance of the limiting concept of ‘foreseeability’, stating that it would be unfair to impose liability upon the defendant if persons in the position of the defendant were not able generally to foresee consequences of the kind that occurred to this class of persons. However, it has often been emphasised that foreseeability is a wide concept. This is especially so in cases involving the infliction of psychiatric injury and purely economic loss. With rapidly expanding scientific knowledge and an advanced ability to think of anything as possible, reasonable foreseeability has come to be widely regarded as an undemanding test for the duty of care. Over many years, courts have searched for a ‘control device’ to place a limit on what was a rapidly expanding tort. Various approaches considering how to do so have been suggested, introduced, debated and refuted. Sullivan v Moody (2001) 207 CLR 562; 183 ALR 404 discusses these matters, without itself suggesting exactly how to proceed. All members of the High Court of Australia adopted a multi-faceted or flexible approach, often referred to as the ‘salient features’ approach

to evaluating whether or not a duty exists, in Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; 194 ALR 337. Sullivan v Moody can be read with this approach in mind. This method of assessing complex duty issues did not always attract the unreserved support of all members of the High Court. For example, when he was on the High Court, Kirby J frequently expressed many doubts about this approach, describing it as a ‘cornucopia of verbal riches’. He (somewhat reluctantly) acceded to using it in Graham. In Chapter 5, we include an extract from a judgment of Allsop P when he was on the New South Wales Court of Appeal: Caltex Refineries (Qld) Pty Ltd v Stavar (2009) 75 NSWLR 649. The judgment carefully describes what the court tends to consider when employing the ‘salient features’ approach. These features include the defendant’s ability to exercise control to avoid harm, the plaintiff’s vulnerability to harm arising from the defendant’s conduct, the plaintiff’s reliance on the defendant, the defendant’s assumption of responsibility and the defendant’s actual or constructive knowledge that the conduct will cause harm to the plaintiff. Notwithstanding the fact that the High Court of Australia has, in some cases, denied the importance of public policy considerations in its deliberations over duty, courts (including the High Court) do indeed incorporate policy considerations in their decision-making. For example, there may be concern that if a duty were imposed, it could result in undesirable ‘defensive practices’ or a ‘diversion of scarce resources’. Additional policy-oriented salient features include the potential indeterminacy of liability, possible deleterious effects on autonomy and the need to avoid conflicting duties and not undermine coherence with other common law principles and statutory obligations. This approach to establishing a duty of care in novel, contentious circumstances involves a ‘balancing act’. Not all salient features found (or missing) in a particular case should necessarily be accorded [page 45]

equal weight. No one feature is decisive to the outcome of the decision. One feature may be of such significance, it trumps a number of features that point in the opposite direction.

Defences Contributory negligence and voluntary assumption of risk 2.9 Defences must be pleaded by the defendant. If successful, they negate or reduce the defendant’s liability to the plaintiff. One common defence, contributory negligence, is the failure of the plaintiff to take reasonable care for her or his own safety or interests. The defendant must prove that despite the risk of injury by the defendant’s conduct, the plaintiff failed to take reasonable care to her or himself and that this failure caused damage to the plaintiff (at least in part). Provided there is a causal connection with the harm, contributory negligence leads to a reduction in the damages entitlement. The effect of a contributory negligence finding is governed by statute.3 Voluntary assumption of risk (volenti non fit injuria) is a complete defence. At common law, this defence has three elements, all of which have to be proven by the defendant on a balance of probabilities: the plaintiff knew of the facts constituting the danger or risk, appreciated (or subjectively understood) the danger or risk inherent in the fact situation, and the plaintiff freely and willingly encountered the danger or risk. Aspects of this defence have been changed in under most Civil Liability Acts. The most common legislative changes involve reversing the onus of proof with respect to certain elements in the context of statutorily defined ‘obvious risks’. Several jurisdictions have enacted special provisions concerning ‘dangerous recreational activities’.

The effect of the plaintiff’s intoxication or illegal conduct 2.10 The legal effect of the plaintiff’s own intoxication or illegal behaviour differs greatly among the states and territories due to a wide

range of legislative interventions. The most moderate approach is that which has been enacted in Victoria, where the Wrongs Act 1958 (Vic) ss 14F, 14G state that the plaintiff’s intoxication or illegality must be considered in assessing the standard of care owed to the plaintiff. Having made that consideration, the statute does not require the court to decide the matter in any particular way, thus preserving judicial discretion (although the plaintiff’s claim could be denied under this provision if the court believed that the particular circumstances warranted such a denial). By way of contrast, the New South Wales Civil Liability Act 2002, for example, is far more prescriptive. It includes very strict provisions concerning the claimant’s intoxication and illegality, whereby courts are required to respond in particular ways, which generally relieves the defendant of responsibility. This book explores in detail the [page 46] ways in which the plaintiff’s intoxication or illegal conduct affects her or his claim in all Australian jurisdictions.

Vicarious Liability 2.11 Vicarious liability is not itself an element of the tort of negligence. It is essentially a loss distribution mechanism. If it is applicable, an employer (or principal) will be made strictly liable for the tort of her or his or its employee (or agent). It applies beyond the tort of negligence. For example, an employer can be vicariously liable for an employee’s assault or battery. Two requirements must be satisfied. First, the person who is negligent must be an employee rather than an independent contractor. The relationship at issue is characterised in accordance with a series of criteria outlined by the High Court of Australia in Hollis v Vabu Pty Ltd (t/as Crisis Couriers) (2001) 207 CLR 21; 181 ALR 263. Second, the employee must have been acting in the course of employment (and not be a ‘stranger’ to

that employment) when she or he committed the careless act or omission (assuming the tort at issue is negligence, for our purpose in this chapter). The High Court of Australia discusses how to make this determination in Bugge v Brown (1919) 26 CLR 110; Deatons Pty Ltd v Flew (1949) 79 CLR 370; New South Wales v Lepore; Samin v Queensland; Rich v Queensland (2003) 212 CLR 511; 195 ALR 412; and Prince Alfred College Inc v ADC (2016) 335 ALR 1. The latter three cases involved the tort of battery.

Damages Assessment 2.12 Once the plaintiff has established liability by satisfying all the elements that have to be proven in her or his cause of action, one of the most significant remaining issues facing the court (or jury) is assessing the size of the damages that will be awarded to the plaintiff. A fundamental principle underlying damages assessment at common law is restitutio in integrum: to restore the plaintiff to her or his position before the tort. This lump sum award is a once-and-for-all-time assessment, in which moderation and fairness are hallmarks of the assessment, according to Sharman v Evans (1977) 138 CLR 563; 13 ALR 57. In that case, the High Court of Australia further states that courts cannot award ‘perfect compensation’. The size of a damages award is not based on the degree of carelessness of the defendant’s negligence conduct (unless there was contributory negligence or more than one wrongdoer). The amount of compensation awarded is determined by who the plaintiff was, is and will be. Whenever the quantum of damages is assessed, the fact-finder considers the following: •

Who was this injured person before the tort — her or his job and interests?

•

Who would this injured person have been in the future, had she or he not been injured by the defendant’s tort? What future work and interests would she or he have had?

[page 47] •

Who is this injured person now, after the tort? As at the date of trial, what is her or his job and capacity?

•

Who will this injured person be in the future? What sort of job will she or he have and what is her or his future capacity?

The tort destroys or diminishes an existing capacity. These are compensated by having regard to the plaintiff’s lost future earning capacity, which is the sum the plaintiff might have earned (an arithmetic calculation); loss of amenities (a non-economic or nonpecuniary sum), which is difficult to evaluate as there is no associated market value for such losses; the needs that have been created would not otherwise exist, such as medical care (past and future) and special equipment. The tort also produces physical pain and suffering, a nonpecuniary loss, which embraces actual physical pain, loss of amenities or loss of enjoyment of life and, where relevant, loss of expectation of life. These losses are not readily susceptible to monetary assessment. The Ipp Panel Report concluded that the full compensation principle was not ‘sacrosanct’. In their implementation of the report, legislatures across the country introduced a number of wide-ranging restrictions on the common law, partly to address the proclaimed public liability insurance ‘crisis’. As of 2002–03, the kinds of limitations imposed by these statutory provisions included ceilings or limits on non-economic loss (pain and suffering, loss of amenities of life and loss of enjoyment of life) and in some cases controversial thresholds for the recovery of these losses. Ceilings on future pecuniary losses relating to future earning capacity were also imposed in various ways and increased discount rates.

Statutory Changes to Common Law Actions: After the Ipp Panel Report (Generally 2002–03) Ipp Panel recommendations and (diverse) legislative

uptake 2.13 The wide-ranging major legislative changes primarily enacted in 2002 and 2003, and referred to in Chapter 1 and at several points in this chapter, are very different from those discussed in 1.21. They not only affect damages entitlements in many contexts (for example, by placing a ceiling on non-economic loss awards), but also affect basic common law doctrine, modifying or even eliminating judicial discretion that had hitherto determined when liability should be imposed. They limit who can sue, when they can sue as well as what can be recovered. Unlike changes to the common law noted in Chapter 1, such as those relevant to contributory negligence or wrongful death (see 1.21), these changes do not tame the common law’s harshness. Instead, in some respects, they add to its severity, at least from the vantage point of injured persons who are dependent on tort for compensation. These enactments do not create a new cause of action, as was the case with the product liability regime introduced by Pt VA of the Trade Practices Act 1974 (Cth), which is now part of the Australian Consumer Law (see 1.23). Finally, these legislative changes do not create new no-fault compensation schemes [page 48] (see 1.8): they do not provide all injured persons with compensation, regardless of the way in which they were injured. In general terms, they make it increasingly difficult for many plaintiffs to successfully litigate in tort. 2.14 Although major changes were enacted in every state and territory, they are not uniform. For example, the subject matter selected for legislative intervention is not the same in all jurisdictions. Indeed, even in those instances where similar subject matter or issues are addressed, the changes themselves are not always identical. That said, it is clear that all jurisdictions moved in the same direction, albeit some more swiftly and radically (and, as some commentators have

asserted, savagely) than others. The statutes of most relevance are the following: •

Civil Law (Wrongs) Act 2002 (ACT);

•

Civil Liability Act 2002 (NSW);

•

Personal Injuries (Liabilities and Damages) Act 2003 (NT) and Personal Injuries (Civil Claims) Act 2003 (NT);

•

Civil Liability Act 2003 (Qld) and Personal Injuries Proceedings Act 2002 (Qld);

•

Civil Liability Act 1936 (SA);

•

Civil Liability Act 2002 (Tas);

•

Wrongs Act 1958 (Vic);

•

Civil Liability Act 2002 (WA).

The primary concerns addressed by the Civil Liability Acts embrace public liability and professional responsibility as well as the injured individual’s personal responsibility and risk-taking behaviour. The regimes generally (but not uniformly) exclude certain kinds of activity or contexts from their purview. Therefore, it is important to carefully scrutinise a particular state or territory’s civil liability legislation to determine if the kind of scenario at issue has been excluded from the legislative changes. If the circumstances are excluded, the situation should be assessed using common law doctrine (and of course any other specialist legislation that may be relevant). The kinds of claims generally excluded from coverage in a number of jurisdictions involve dust-related diseases; injuries resulting from smoking or other use of tobacco products; civil liability for intentional acts done with intent to cause injury or death or sexual assault or other sexual misconduct; and aspects of motor vehicle and workplacerelated claims.4 (As was noted at 1.13–1.14, workplace and [page 49]

motor vehicle injuries have for some time been the subject of diverse statutory interventions, including the establishment of compensation schemes and/or the imposition of limits on common law actions, such as damages awards.)

The first wave of legislative changes 2.15 In national terms, the first wave of statutory intervention (around 2002) generally addressed the following tort-related issues (not all apply in all jurisdictions). Most of these changes are explored in detail, where relevant, throughout this book: •

‘good Samaritans’, volunteers and food donors are (generally) protected from tort suits with respect to injuries they may cause;

•

apologies and expressions of regret are prescribed, by statute, as not amounting to admissions of liability;

•

the illegal behaviour of the injured person results in (virtual) preclusion from recovery in some jurisdictions;

•

the plaintiff’s intoxication (by alcohol or recreational drug) must be considered in various prescribed ways, sometimes resulting in conclusive (or at least presumptive) disentitlement to recovery, or damages reduction;

•

courts can order structured settlements (payment of damages awards in instalments rather than in one lump sum);

•

limitation periods, which are imposed by statutes and prescribe when proceedings must be instituted, are (generally) reduced under the new provisions (although safeguards exist in certain circumstances, such as those involving infants or persons with mental disabilities);

•

costs penalties are imposed with respect to frivolous or unmeritorious claims, with caps on the recovery of legal costs in small claims.

The second wave — additional legislative measures

2.16 Not long after this early series of changes was enacted, additional legislative measures were introduced throughout the country. Most were first formulated in New South Wales, with a view to being used elsewhere as ‘model provisions’. Once again, not every jurisdiction followed suit in identical ways. While some of these [page 50] changes do little more than mirror common law principles, others significantly alter judicially developed doctrine in a prescriptive manner. The following is a list of some of the most important of these interventions. Many (but not all) of them have been introduced in a number of jurisdictions, but not necessarily all jurisdictions in all instances. A few of the most notable jurisdictional differences are noted below. They are explored in detail, where relevant, throughout this book: •

criteria for breach and standard of care are established by statute (New South Wales, Victoria and Western Australia incorrectly use the heading ‘duty of care’; the Australian Capital Territory, Queensland, South Australia and Tasmania correctly use the headings ‘breach’ and ‘standard of care’, reflecting the content of the provisions);

•

a framework relevant to causation is established by statute, including references to ‘scope of liability’ (policy considerations);

•

the way in which the voluntary assumption of risk defence operates at common law, in terms of proof and awareness of ‘obvious risks’, is reversed;

•

proactive duties to warn of obvious risks (generally) are introduced;

•

liability for harm suffered by the materialisation of obvious risks of ‘dangerous recreational activities’ is eliminated (in New South

Wales, Queensland, Tasmania and Western Australia); •

liability for the materialisation of ‘inherent risks’ is eliminated in specific terms;

•

standards of professional negligence in the context of service provision is altered, by reintroducing the defence of compliance with peer professional opinion (unless ‘irrational’ in most jurisdictions, ‘unreasonable’ in Victoria and ‘so unreasonable’ in Western Australia);

•

the circumstances in which liability is to be based on a nondelegable duty is prescribed in New South Wales and Victoria;

•

liability for ‘mental harm’ is limited;

•

liability of public and other authorities is limited (most significantly in New South Wales);

•

special nonfeasance protection is provided for roads authorities (with respect to omissions);

•

the right to self-defence in assault and battery tort claims is enshrined by statute in New South Wales;

•

proportionate liability for economic loss and property damage claims is introduced;

•

the possibility of finding a plaintiff 100 per cent contributorily negligent is reintroduced; [page 51]

•

the possibility of finding contributory negligence in wrongful death claims, with respect to the deceased’s acts or omissions, is reintroduced (not in Victoria).

Furthermore, limits placed on common law damages assessment are now widespread. These restrictions go beyond those that previously

had been enacted in some jurisdictions with respect to workplace and motor vehicle accidents (noted above). These provisions: •

place ceilings or caps on loss of earning capacity;

•

place ceilings or caps on non-economic loss;

•

introduce thresholds on recovery for non-economic loss;

•

place caps or limits on recovery for gratuitous services;

•

increase the discount rate;

•

restrict or eliminate exemplary and aggravated damages awards.

In some states and territories, specific, ad hoc (miscellaneous) changes have been implemented. These measures have not been as widely subscribed to as many of those significant ones that have been listed to this point. For example, these measures: •

restrict advertising of personal injury legal services;

•

limit legal fees in ‘no win no fee’ cases;

•

abolish juries hearing personal injury actions (in Queensland);

•

grant occupiers some additional protection from tort claims.

Rationale for the interventions: the ‘insurance crisis’, personal responsibility and the perceived need to tame tort 2.17 Those advocating in favour of the kinds of large-scale legislative changes that are noted in 2.15–2.16 asserted that the changes were necessary responses to Australia’s deepening ‘liability insurance crisis’ and large rise in tort litigation. The ‘insurance crisis’ was ‘in the form of dramatically rising insurance premiums and, in relation to some activities, liability insurance being unobtainable altogether’:5 [O]ne manifestation of the insurance crisis has been increasing liability insurance premiums. From the period June 2001 to May 2002, for example, premium increases averaged 22 per cent, with some industries, such as outdoor sport and recreation, particularly hard hit, facing premium increases in the range of 100–500 per cent. As a

result, it has been asserted, the survival of many small businesses is threatened, particularly in the tourism and recreation industry.6

[page 52] Noting the problems faced by local authorities and the medical profession obtaining public liability and professional indemnity insurance — and the consequent closure of medical practices, schools, kindergartens, community gatherings (such as dances, pony rides, country fetes and city concerts) — Justice Ipp asserted that ‘the basic fabric of community life was being harmed. This was not something that could be ignored’.7 Responding to concerns about the inordinate cost to the community produced by personal injury claims, the Commonwealth Government, primarily at the urging of New South Wales, organised a series of inter-governmental meetings to discuss changes to tort law, and appointed an expert panel to review the law of negligence. The mandate or terms of reference of the ‘Panel of Eminent Persons’ — the ‘Ipp Panel’ — was limited by the government body that appointed it (Treasury): The award of damages for personal injury has become unaffordable and unsustainable as the principal source of compensation for those injured through the fault of another. It is desirable to examine a method for the reform of the common law with the objective of limiting liability and quantum of damages arising from personal injury and death.8

By way of contrast, commenting on the recommendation to make the foreseeability threshold tougher on plaintiffs, Professor H Luntz notes, almost parenthetically, that the Ipp Panel’s Review of the Law of Negligence was conducted ‘in response to the supposed “insurance crisis”’ (emphasis added).9 Elsewhere, Luntz refers to an ‘alleged public liability and medical indemnity crisis’ (emphasis added).10 In 2002, the panel, comprised of Justice D Ipp (of the New South Wales Court of Appeal), Professor P Cane (an academic lawyer), Dr D Sheldon (a surgery professor) and Mr I Macintosh (Mayor of Bathurst City Council), issued the Review of the Law of Negligence, which had 61 recommendations. The Panel had been formed just prior to New South

Wales releasing a discussion draft of its second stage of statutory interventions to the common law. It considered and based some of its recommendations on a number of the New South Wales proposals.11 Commenting on the Panel’s composition, Cane notes: The membership of the Panel also reflected the political climate in which it was established. Law reform bodies are typically staffed wholly or predominantly by lawyers. Only two of the members of the Panel were trained lawyers. The other two

[page 53] were identifiable with two of the main stakeholder groups (local authorities and the medical profession).12

The extraordinary speed with which the reports were written is reflected upon by Cane: ‘The Panel was given little more than two months to conduct the Review. The original proposal would have given only about a month!’13 He continues: The time scale of the Review was, unsurprisingly, the subject of much criticism and it placed significant constraints on the amount of detail that the Panel could provide both in its recommendations and in the reasoning used in their support. It was suggested to the Panel more than once that an extension of time should be sought. However, it was clear that no extension would have been granted.14

While complimenting the non-legal members as ‘conscientious, hard-working and open-minded’, Cane confesses that their lack of legal expertise limited the extent of their participation in preparing the reports and formulating (and debating) the recommendations: [O]ne undesirable result was that the burden of this work fell almost exclusively on the two legal members. This made the shortage of time more significant than it might otherwise have been and — just as importantly — deprived the Panel’s deliberations on many issues of a certain degree of diversity of informed opinion and debate.15

As was noted above, a number of its recommendations (or versions of them) were enacted. Others were less widely received, at least initially. Others were not endorsed.

Heated Debate: Critics and Defenders of the

Changes 2.18 The statutes were introduced in a manner that was, for major law reform purposes, ‘unprecedented’16 — a ‘sea-change’.17 R Davis describes the changes as an ‘orgy of tort reform’, and a misguided solution to the contention that the ‘current crisis in insurance’ was a result of a litigation explosion or change in Australian attitudes regarding blame.18 Commenting on the breadth of the swiftly enacted changes, Senator Coonan, Minister for Revenue and Assistant Treasurer, stated: Such extensive law reform in a limited timeframe is unprecedented in the history of Australian insurance law and, taking into account the complexity of Australia’s

[page 54] multiple jurisdictions, perhaps a first for the common law world. … In response to the damaging and wide-reaching impact of the liability insurance crisis, Australian governments acted swiftly and decisively.19

A rather different approach to negligence law reform was advocated by Chief Justice Spigelman, writing extra-judicially: What appears to be required is a longer-term process of systematically reviewing a range of options …. An appropriate way of approaching such a task would be to invoke the resources of all of the law reform commissions throughout the Commonwealth and to allocate specific matters for inquiry to individual commissions. The entire process could be supervised under the auspices of the Standing Committee of Attorneys-General.20

He continued, ‘No doubt there will be some reluctance to allow the lawyers to control the agenda in this regard’.21 His concern proved prophetic: as was noted above, the task fell to Treasury. Underlying the Ipp Panel’s recommendations, which led to the statutory changes, are several themes that were noted in 2.1. As we outlined above, they focus on the perceived need to: •

increase ‘personal responsibility’ for the consequences of one’s own conduct resulting in injury;

•

reduce society’s culture of blame;

•

rein in tort awards, juries and trial judges;

•

make insurance affordable.

Some commentators expressed concern that the Ipp Panel’s mandate was too narrow and was based on assumptions that could not be challenged or investigated.22 As Associate Professor M Parker reminds us, ‘Perceptions of a crisis in medical indemnity are not new. Tort law reform in relation to medical negligence has been proposed for over three decades …’.23 In the context of changes to the law concerning recreational services, Associate Professor J Dietrich concludes that the reform process, based on these premises, ‘was always going to be flawed’.24 Indeed, [page 55] some analysts argued that there was no empirical evidence supporting allegations of a ‘litigation crisis’. Professor R Graycar commented: [W]hat has struck me as singularly notable is the absence from the debate of actual data about the extent to which the tort system does (or does not) respond to people who experience accidents and injuries. The media and political commentary has [sic] focused on individual anecdotes and horror stories designed to demonstrate our supposed increasing litigiousness and avoidance of ‘personal responsibility’. We hear much about how we are becoming a ‘blame’ society, but rarely are we also told, at least by the media who have helped to fuel the ‘crisis’ environment, that as the law now stands, a person who has been injured has to find someone to blame before they can receive any compensation.25

Later, reflecting upon the ways in which his panel’s report was utilised, Justice Ipp (rather curiously) wrote: There is no conclusive evidence that the state of the law of negligence bears any responsibility for this situation. But the fact is that insurance companies assert that they are not prepared to provide the necessary insurance (or are only prepared to provide it at unaffordable rates) because of the unpredictability of the law, the ease with which plaintiffs succeed and the generosity of courts in awarding damages. There is evidence to suggest that the insurance crisis is at least partly attributable to the conduct of certain insurance companies, but that is not to say that the state of the law of negligence has not contributed to the current state of affairs.26

The nature of many of the recommendations and statutory changes inspired some critics to assert that they do not neatly fit the label ‘reform’. According to Professor B Feldthusen, ‘Finally, we should observe that the term “reform” in the tort context inevitably means to roll back, to limit, to restrict’.27 Graycar agreed, cautioning, ‘We should start by refraining from the use of the word “reform” when what we actually mean is “cuts”’.28 Cane characterised the recommendations as follows: [They were] practical and focused proposals to deal with acute social and political problems. The prime audience for the Panel’s report were [sic] politicians, not lawyers or academics. The qualities most demanded of the Panel were not erudition and painstaking analysis but decisiveness and what the great realist jurisprude, Karl Llewellyn (speaking of the judicial task), called ‘situation sense’. It is against such criteria that the Panel’s report should be assessed and not in terms of the more leisurely virtues of the academy or the law reform commission.29

[page 56] Commenting on the debate generally, Luntz observed: I contend that the rise in premiums is due to complex factors, not all of which are yet fully known, but that lack of principle [in negligence law] plays only a minor role among them; that the changes advocated by politicians are making the law less, not more, principled; and that these changes will do little to reduce the costs of the system of compensation. I assert that the problem with the present system of compensation is its slow, cumbersome, expensive and discriminatory operation; that many of the costs of injury are inevitable and will be incurred anyway; that the real issue is how the unavoidable costs should be allocated; and that to make the system more affordable requires the elimination of the wasteful costs of investigation into fault.30

The Upshot 2.19 To sum up, several of the changes introduced by these statutes31 are of great significance. This is especially so where they affect what courts previously had discretion to do at common law, such as most jurisdictions’ provisions that address the claimant’s illegal conduct and intoxication. Other provisions simply restate or

perhaps clarify the pre-existing positions at common law — the effect of an apology, for example. Some changes, such as the protection of food donors, have had little practical impact, as the number of actual cases they affect is relatively negligible. However, at the other end of the spectrum, those changes that affect damages assessment, including, for example, changes to the discount rate, have had a notable impact on the common law. Several provisions, such as those concerning intoxication in some jurisdictions, certainly have had a profound effect on claims, diminishing the role that tort can play as a compensatory mechanism. One thing is certain: tort is no longer primarily the province of the courts. However, with so many legislative changes and definitions included in these provisions, litigation has been necessary to test the meaning and scope of these measures. Just because legislatures have introduced the ‘not insignificant’ risk threshold and defined ‘obvious risk’ in statutes, it is not surprising to see that this has not been the end of the story. Courts continue to have plenty of important and interesting things to say about what these provisions really mean, at least in their view.32 [page 57] The same may be said with respect to the meaning of ‘dangerous recreational activity’ and myriad subject matter now made the subject of legislative attention. Pullin JA expressed his concerns with respect to issues of statutory construction in Department of Housing and Works v Smith (No 2) (2010) 265 ALR 490 at [15]–[16]: In CG Maloney Pty Ltd v Hutton-Potts [2006] NSWCA 136 at [177], Bryson JA made the following observations about the New South Wales Act which can be applied to the [Western Australian] CLA [Civil Liability Act]. His Honour said that there was no general statement of purposes or objectives in the Act; that some of the provisions may have been intended to restate or declare parts of the law of negligence while others changed parts of that law; that he had not observed any overall purposes or scheme of the amendments which could be brought to bear on the construction of any particular provision; and that the application of each provision should be

considered in its statutory context and in relation to the facts of each particular case in which the litigant claims to rely on it. The passing of legislation with different provisions and different wording in similar provisions in jurisdictions around Australia has the potential to have an undesirable effect on what was a unified law of tort in Australia. Rather than creating fairness and predictability, the existence of different legislation around Australia might create a lack of predictability and increase the cost and availability of insurance.

As we noted previously, the most significant legislative changes are considered throughout this book, as they arise in their specific contexts. Problem 1 2.20 Sixteen-year-old Diablo was sentenced to two years custody, to be served at Devil’s Peak Juvenile Jail, a custodial institution for juvenile offenders. He was sentenced for trafficking in heroin, and robbery using syringes (needles) as weapons. On previous occasions when he had committed similar offences, Diablo had been given lenient sentences — community service orders and fines. After Diablo had been in custody for one year, his case was reviewed by the Devil’s Peak Parole Board (‘the board’). The board was comprised of five social workers, with Social Work and Criminology degrees from Daisy Bay University. Relevant sections of the governing Juvenile Jails Act 2017 state: s 1 The Devil’s Peak Parole Board is an independent statutory body. It plays an important role in the juvenile justice system by managing the appropriate release of juvenile offenders, by placing them on parole orders. Ultimately, this enhances the safety of the community. In all decision-making, the board’s most important consideration is long-term community safety. s 2 The Devil’s Peak Parole Board may conduct its hearings and make its determinations in whatever way it chooses. At any hearing, after assessing risk, the board may determine whether to grant or deny parole to particular detainees. Where appropriate, the board may set appropriate conditions for parole release. [page 58] A few days before Diablo’s hearing, the board members had read a recently published post on ‘Social Work Suggestions’, a Dutch blog in which internationally renowned social work professor, Dr Van Smit, strongly argued that regardless of the reasons for their incarceration, all juvenile offenders should be integrated into the community as quickly as possible, to achieve effective rehabilitation. His blog post went viral. Over 200 social workers and social work academics from all over the world tweeted their approval. However, Dr Van Smit’s approach was at odds with the traditional view of the Australian Association of Social Workers, which represented 7,500 social workers. It

issued a caution on its website, maintaining that drug offenders in particular required long-term incarceration before they are integrated into the community, as they were regarded as deceitful and prone to repeated, serious criminal activity. At Diablo’s parole hearing, the board had to decide whether or not to release him into the community prior to serving his full sentence in custody. The board noted Diablo’s lengthy record of drug-related crimes and robberies. However, the board thought that Diablo came across in his interview as a rather respectable, charming young fellow. Because the board had so many hearings to conduct that day, it did not have time to review all the attachments stapled to Diablo’s file, including a note by Devil’s Peak Juvenile Jail’s governor: ‘Diablo is an untrustworthy, troublesome con artist who has shown no signs of remorse for his heinous, predatory crimes.’ After a very brief hearing, the board unanimously decided that Diablo should be released to reside at Homestead Half-Way House Pty Ltd (‘Homestead’), where he could come and go as he pleased during the day, with a view to helping him reconnect with family and friends. A condition of his release was that he be closely supervised in the evenings by Homestead’s staff, to make sure he stayed out of trouble. In its decision, the board noted the high cost associated with keeping juveniles incarcerated, as opposed to releasing them on parole to a half-way house. Homestead is a privately owned half-way house dedicated to caring for juvenile parolees. It had 100 juvenile parolees as residents, 50 of whom had been sentenced for drug-related offences. It is a member of the Half-Way Houses Association, which recommends that all member institutions adhere to the following code: ‘At least one well-trained staff member should be on duty for every 10 juvenile parolee residents.’ Evening shifts were staffed solely by five part-time Daisy Bay University social work students. They were to receive credit in their Parole Internship subject by working closely with juvenile parolees, trying to rehabilitate them. To enhance Homestead’s casual atmosphere, they were allowed to wear jeans and T-shirts while on duty. Homestead paid for their security clearances and issued them with security passes and smartphones installed with work-related apps (including one to report parolee activities) for use while on duty. Homestead paid the students a token amount, with taxes not deducted at the source. For several years, Homestead’s administrators had managed to make Homestead drugfree. Indeed, Homestead had won an ‘Astonishing Achievement Award’ from the government for keeping Homestead and its residents ‘clean’. Even 15-year-old Purity, a juvenile offender with a history of living on the streets prior to being incarcerated and who had been assessed as having a low IQ, managed to kick her drug habit while on parole at Homestead. That all changed upon Diablo’s arrival. Every day when he left Homestead, he contacted his former drug supply associates [page 59] to secure injecting drugs for surreptitious sale in Homestead. The half-way house proved to be an exceptionally profitable market for his criminal enterprise. For several months, each evening, Diablo sold drugs to Homestead’s residents, undetected by the five social work students on duty. In addition to selling heroin to Purity, Diablo watched Purity inject

herself using a dirty needle nicknamed ‘Rusty’, which had been circulating throughout Homestead since Diablo’s arrival. Although the social work students were aware of drug use among the residents over the last few months and of Rusty’s existence, they could not work out a way of stopping the drug trade and drug use, without getting the parolees offside and rebellious. They considered introducing random searches of the parolees’ units, but decided to not conduct them, because they believed such measures would be overly intrusive. They were so frustrated by Homestead’s rapid deterioration, which would likely be reflected in their now-slumping Parole Internship grades, they resigned themselves to their predicament. Purity’s addiction resurfaced as a result of using the heroin Diablo regularly supplied to her. To support her habit, she committed several robberies. One day, desperate to steal some cash so she could buy some heroin from Diablo, Purity stabbed pregnant Pearl with the dirty needle. Pearl managed a cafe opposite Homestead. Pearl was diagnosed with HIV, caused directly by the dirty needle. She now has to undergo a lifelong treatment to manage this chronic disease. Several months later, she gave birth to Rocky, who Pearl desperately fears will become HIV positive despite the fact that all Rocky’s blood tests indicate he is HIV negative. Pearl’s partner, Xena, left Pearl because Xena could not endure what she believed was Pearl’s irrational concern over Rocky. Pearl has been diagnosed with a recognised depressive illness. She mourns her previously joyful life. Several months later, Purity was diagnosed with HIV, which was caused directly by the dirty needle she had used to inject heroin while at Homestead. She now has to undergo lifelong treatment. Discuss the critical points a court would consider in the following actions: (a) Pearl against the Devil’s Peak Parole Board. (b) Purity against Homestead Half-Way House Pty Ltd (i) directly and (ii) vicariously. Do not discuss the assessment of damages.

Discussion 2.21 Please note that the following discussion, which follows the framework traditionally used by the courts (beginning with the duty question), includes critical points outlined in this chapter. It also refers to a number of cases and legislative provisions you will encounter in our detailed exploration of negligence law, throughout this book. This is intended to give you a sense of how this forthcoming detail will emerge and how it can be applied. Note that complete case names, the names of statutes and citations are not provided in this discussion. We also do not include a detailed use of all jurisdictions’ specific statutory provisions, but apply the [page 60]

gist of the relevant sections, noting their effect in general terms. We recommend revisiting this problem and discussion as you gather detailed understanding of the ways in which the elements of the tort of negligence operate. Finally, please note that because this is an overview, the following discussion weaves together both sides’ arguments, issue by issue. This is the approach typically used to answer problems in examinations and essays and is similar to the approach used in the comprehensive Revision problem and answer in Chapter 21. It is however different from the approach taken in other chapters, where we set out each party’s full set of arguments relevant to the particular chapter, one after the other; this approach is similar to that used when addressing a moot court problem. (a) Pearl against the Devil’s Peak Parole Board (sometimes referred to as ‘Devil’s Peak’) Duty of care Scope of duty (Chapters 5, 6) Whether the Devil’s Peak Parole Board owes a duty of care to Pearl, an individual member of the public, with respect to the criminal conduct of a third party (Diablo; Purity) is a key issue. This is not an established duty relationship: that is, this is not a case where violence occurred in a prison (Bujdoso) or at a venue which had statutory responsibilities (Adeels). Establishing a duty in this context can be difficult. The use of Modbury is important. The fact that Devil’s Peak is a statutory authority further complicates duty arguments. Foreseeability (Chapter 5) Pearl must belong to a class of persons who could reasonably foreseeably suffer harm as a result of carelessness by Devil’s Peak (Chapman). Pearl only needs to establish that it was reasonably foreseeable that some kind of carelessness by the board could result in some kind of harm to individual members of the public. This is a low threshold test: ‘real and not far-fetched’ (Sullivan) or ‘not unlikely’ (Chapman). Further, the defendant need not foresee the precise sequence of events (Chapman). This is an essential but not sufficient criterion for establishing a duty, according to many leading cases, for example, Sullivan and Crimmins. Here, the class would be rather wide, that is all those in the community affected by released offenders. That said, Diablo’s history and the board’s role are such that this kind of potential general harm is not uncommon. It is a clear risk associated with release from detention, integration and rehabilitation goals. Salient features: contexts — statutory authority; duty to control conduct of a third party (Chapters 5, 6, 7) The court will take a salient features or multi-factor approach (Sullivan; Perre; Graham; Caltex), examining the ‘totality of the relationship’ (Gummow and Hayne JJ in Graham), to decide if ‘it is reasonable in all the circumstances’ to impose a duty (Kirby J in Graham). The fact that the Devil’s Peak Parole Board is a statutory authority is important. While a statutory authority can owe a duty of care (as in Crimmins and Pyrenees, and noted in Heyman) it is difficult to establish. Devil’s Peak has a statutory

power (for example, ‘may set appropriate conditions’) (Heyman; Graham; Stuart). However, the Devil’s Peak Parole Board embarked on a course of conduct, [page 61] so it might not be characterised as a pure omission, but positive conduct. In many but not all jurisdictions, statutory provisions are relevant. For example, the court may be directed to take into account the following: Devil’s Peak’s limited financial resources and its broad range of activities and responsibilities. The latter is not especially relevant, compared to other public authority cases, as Devil’s Peak had one sphere of responsibility — parole determinations. Pearl also may argue that by not reviewing an important file note with the governor’s comment, Devil’s Peak failed to follow its own procedures, despite the fact that it was allowed to ‘make its determinations in whatever way it chooses’. Even where these provisions apply, the considerations they embrace are not determinative. The common law also must be utilised. At common law, ‘policy’ decisions are immune (Mason J in Heyman). Despite the fact that Devil’s Peak had a great deal of choice as to how to make its determinations, in this instance the process went well beyond acceptable leeway, as Devil’s Peak neglected to review all the relevant attachments to Diablo’s file. This might even meet the very high threshold for establishing breach, set out in the New South Wales statute. A particularly significant salient feature in this context is control. Devil’s Peak may argue this is similar to Godfrey, where no duty was owed due to the absence of control and indeterminacy. In response, Pearl would note that the board had complete control; it was simply exercised carelessly, by not properly reviewing Diablo’s file. Further, the geographical proximity issue is different from Godfrey as Pearl was exposed to a far greater risk than other members of the public. Devil’s Peak placed Diablo in Homestead, without (arguably) properly reviewing his file and not making sure that close supervision conditions were enforced. Devil’s Peak will maintain that it did not have control over the risk of harm, as it was fragmented (Graham; Agar) as follows: Devil’s Peak Parole Board → Diablo → Homestead → Purity → Pearl. The Devil’s Peak Parole Board would emphasise that Diablo was not the one who harmed Pearl; Purity was the source of the risk of harm and she was someone over whom Devil’s Peak had no control. This is similar to Stuart, where the defendant did not have control over the source of the harm, the person who committed suicide. Pearl must argue that this falls within the slim exception from Modbury, where criminal conduct is so predictable that a duty should be owed. This has some prospect of success, bearing in mind Diablo’s history and the (unread) notes on Diablo’s file. Pearl would note that this was not random, as in Modbury, but quite likely. While not exactly the same as Adeels, it is arguably closer to it than it is to Modbury. However, Devil’s Peak would maintain that this is not within the exception in Modbury (and Smith v Leurs), as Diablo, the person over whom some control arguably existed, was not the one who stabbed Pearl. It was Purity who stabbed her, months later. Purity could have committed a robbery at any time or place, for reasons that had nothing to do with Diablo (and Devil’s Peak’s parole determination).

Pearl could argue that Devil’s Peak ought to have had knowledge of the risk of harm (Crimmins), based on Diablo’s file. Devil’s Peak would again highlight that Purity was the one who stabbed Pearl and what Diablo might do is not exactly on point here. Devil’s Peak will note that it did not have knowledge of the specific risk of violence at the site where it occurred (unlike Pyrenees; more like Graham). Pearl was [page 62] arguably vulnerable, because she worked at a place very close geographically to where Devil’s Peak placed parolees such as Diablo (and also presumably Purity) for accommodation. Pearl would argue that she could not take steps to protect herself from the risk of being subject to a robbery. Indeterminacy would be argued by Devil’s Peak as a major salient feature, working against finding a duty, contending that it is impossible to properly define an ascertainable class (McHugh J’s comments on the meaning of indeterminacy in Perre). Factually, Devil’s Peak would convincingly argue this is unlike Perre, with its ascertainable class, due to the quarantine imposed by the statute. Pearl would attempt to define the class in a geographically limited/proximate way (see above). Even though Pearl (and many members of the community) might state that they ‘rely’ on parole boards to act carefully, ‘general reliance’ has been discredited as a basis for finding a duty (Pyrenees). Policy concerns (aside from indeterminacy) include the following: defensive practices, whereby, if a duty were found, Devil’s Peak might be overly cautious in future, not releasing anyone on parole, for fear of liability (Sullivan). Coherence of the law is also at issue, as it could be said that a duty would undermine the statutory framework under which Devil’s Peak operated (Sullivan; Stuart; Graham; Hunter). Pearl would note that the statute articulated a primary concern for community safety, which was flagrantly ignored. Finally, would a duty lead to an untenable diversion of resources? This is not an issue if the focus is on the board’s review of Diablo’s file. However, the board may note that Cran is similar, where a ‘minor’ error with serious consequences was considered to be within policy reasons, negating a duty. Pearl would argue that the circumstances of her case are distinctly different, as they had wide-ranging effects: a poorly made decision by the board placed a significant segment of the community at risk, in violation of the statute’s terms. (She may also contest Cran’s correctness.) However, the High Court’s decision in Hunter may be difficult to circumvent in these circumstances, although it is important to note that the reasoning in that case was very much driven by the way in which the High Court interpreted the statute that was at issue (mental health legislation) and the significant policy rationale that underpinned it. Several salient features are in the board’s favour, including some policy considerations involving public authorities, such as the encouragement of release and the fact that this case involves the control of a third party’s criminal conduct (Purity; Diablo). Because of the changes in the Civil Liability Acts in most jurisdictions and their intent, the court may be reluctant to find a duty. The extra hurdles presented by the statute in New South Wales in particular, as well as standing hurdles in the Australian Capital Territory and Tasmania, may result in the court’s inability to find liability in those jurisdictions. However, the serious ‘real-world’ consequences of the file review error and effect on the

community of an arguably careless release (as in the tragic circumstances involving journalist Jill Meagher) favour Pearl. Ultimately, while it may be difficult establishing a duty — and very difficult doing so in certain jurisdictions – it is possible. Breach of duty/standard of care (Chapter 3) Pearl must identify specific arguable breaches: for example, the board (i) failed to properly review Diablo’s file before placing him on parole; and (ii) failed to enforce the conditions of Diablo’s parole. In most jurisdictions, the Civil Liability [page 63] Acts must be used; they sit alongside the common law approach from Mason J in Shirt (Shaw). The breach/standard of care question involves the determination of a reasonable person’s response to a foreseeable risk of harm (assuming it is foreseeable.) The Devil’s Peak Parole Board is only required to respond to reasonably foreseeable risks. It ought to have known of the risk of releasing any offender on parole, based on their criminal history — that this kind of carelessness could cause some kind of harm. The ‘not insignificant’ test has amended the low threshold common law test (‘not farfetched or fanciful’) in most jurisdictions. This is an essential but not sufficient requirement (Mason J in Shirt). It is easily established for both breaches as it is such a low threshold. Not reviewing the complete file could produce a not insignificant risk of harm, especially when relevant comments pointed to serious concerns about Diablo. Also, the absence of a follow-up to enforce conditions under which parole is granted could lead to a not insignificant risk of harm — including recidivism. There are a large number of not insignificant risks of harm that could materialise when determining whether offenders who have committed significant crimes should be placed on parole. The ‘calculus of negligence’ must then be examined, with the relevant statutory changes closely reflecting Mason J in Shirt. It is a flexible approach, weighing up several prescribed factors. Hindsight must be avoided (Vairy; Dederer). In most jurisdictions, it must be adjusted because the defendants are ‘professionals’. Here, the probability that harm will occur is high, considering the potential for repeat criminal behaviour and potential consequences, having regard to Diablo’s history. With respect to magnitude, the risk of harm to members of the community who come into contact with parolees like Diablo is potentially grave. It is higher for someone like Pearl because of her proximity to Homestead, where Diablo was placed with former offenders like Purity, with similar histories. The burden of precautions will be different for different breaches. The burden is potentially heavy if the alternative is to not release offenders until their full sentences have been served. Indeed, that would make the whole notion of parole and the board’s role redundant (like closing down an industry, Graham). (See also social utility, noted briefly below.) Pearl would insist that a properly conducted hearing was required, involving a thorough, careful, methodical review of all relevant documents and properly conducted interviews. This is not burdensome, and is required if the statute’s community safety concern is to be met. Devil’s Peak would note how rushed and overworked it was and the consequent cost if proceedings were made longer. The cost is a relevant consideration (and excuse) in public authority contexts (under most Civil

Liability Acts and at common law). Devil’s Peak’s failure to follow up the enforcement of its condition with Homestead could be quite burdensome, depending on the nature of the suggested process. Regarding justifiability or social utility, the Devil’s Peak Parole Board would note that it was trying to rehabilitate and integrate prisoners. Who is the ‘reasonable person’ in these circumstances? This is an objective test (Vaughan; Blyth). But the Devil’s Peak’s Parole Board is comprised of ‘professionals’ — social workers. They should be held to a higher standard of care, with associated skills. A range of statutory changes have been made to the common law with respect to professional services and the value or weight to be [page 64] placed on ‘peer professional opinion’ when making a breach assessment. For example, in some but not all jurisdictions, the board can show that a ‘significant number’ of ‘respected practitioners in the field’ (Dr Van Smit and the 200 blog followers (arguably experts)) would have acted similarly, integrating Diablo. The board would argue that it does not matter that the Association of Australian Social Workers (7,500) held contrary views, as the opinion the board followed does not need to be ‘universally accepted’. Pearl would contend that the court should reject the overseas opinion as it was not ‘widely accepted in Australia’. Further, Dr Smit’s and his followers’ views are ‘irrational’ or ‘unreasonable’ (this qualification differs among the statutes). Pearl would maintain that every parole determination should have regard to the individual characteristics of the particular detainee under consideration. It should be noted that peer professional opinion provisions operate as a defence. Having regard to all these factors, the breach based on the file assessment should succeed. There was a specific concern voiced by the governor about Diablo, which was not noted by the board’s social workers/parole officers. Non-burdensome precautions could have been taken to avoid the risk of harm. Peer professional opinion should not relieve the Devil’s Peak Parole Board of this breach. Causation — factual (Chapter 4) Pearl must show that at least one of the alleged breach(es) caused her harm. In most jurisdictions, the court must start with the relevant Civil Liability Acts. The first element, factual causation, requires the following to be asked: was Devil’s Peak’s breach a necessary condition of Pearl’s harm? This largely incorporates the ‘but for’ test (Zanner), and involves a comparison of what happened with what would have happened without the breach, on the balance of probabilities (Strong; Adeels). Breach — releasing Diablo with incomplete information: Pearl must prove that the extra information from the governor would have altered the board’s decision to release Diablo. Assuming it would have, then it is more likely than not that Diablo’s release was a ‘necessary condition’ of Pearl’s injury. However, this presumes that Purity would not have resorted to drug use and robbery had it not been for Diablo. This seems likely, as she had been ‘clean’ prior to Diablo’s presence and influence. Ultimately, Pearl must argue that her harm eventuated because of Diablo’s release.

Breach — non-enforcement of release condition (supervision at Homestead): Pearl will argue that if Homestead had closely watched Diablo and Purity, Pearl’s harm would have been avoided. Devil’s Peak would argue this is too speculative, asserting that while closer supervision might have made a difference, it cannot be said that it would have done so (Adeels and the provision of security — we just do not know). Causation — scope of liability (Chapter 4) and mental harm (Chapter 9) The scope of liability is pursued here with respect to the first breach. The question of whether or not and why Devil’s Peak’s liability should extend to Pearl’s harm is governed by statute in most jurisdictions. This is a flexible, policy-based, normative inquiry, as the High Court emphasised in Wallace. The ultimate question is whether it would be ‘appropriate’ to impose legal responsibility. Two common law concepts can [page 65] be placed within this normative question — new intervening acts and remoteness of harm. New intervening acts: was the causal chain broken? This can be volitional (Rickards), when the act is ‘free, deliberate and informed’ and ‘intended to exploit the situation’ (Yates) or a subsequent negligent act. With respect to Diablo’s act, it would make no sense to say that the scope of the duty extends to protection from a third party’s criminal conduct and then argue that the very conduct was a new intervening act (Adeels; Modbury; Chomentowski). However, the act of violence here was Purity’s, not Diablo’s. Devil’s Peak will argue that Purity was a new intervening act, as in Yates (drug dealer). Pearl will maintain that the duty extended to control Purity as a third party and that Purity’s act of violence should not be a new intervening act — that conclusion would rob the duty of meaning (as with Diablo). Pearl could argue that Purity was not acting with full volition or free will (Haber). In response, the board would rely on Yates, where the plaintiff’s heroin use was a new intervening act. Was Homestead’s conduct a subsequent negligent act, such that it could be considered a new intervening act? This is determined as a ‘matter of fact (or circumstance) and degree’ (Mahony; Chapman). Even if a breach is found (see question (b)), to be a new intervening act it has to be ‘inexcusably bad’ or ‘extravagant’ or ‘completely outside the bounds’) (Mahony). If it is an ordinary breach, there would be apportionment between Devil’s Peak and Homestead. Ultimately, this is resolved as a matter of policy and ‘appropriateness’. With respect to remoteness of harm issues, according to Wagon Mound (No 1), a reasonable foreseeability test must be used, such that this kind or type of harm needs to have been reasonably foreseeable as a result of this kind of carelessness. There is no need to be able to reasonably foresee the precise manner in which the harm came about (Hughes; Gittani) nor the extent of harm (Hughes). Pearl’s HIV readily fits as a reasonably foreseeable kind of harm, with respect to shared needle use, especially bearing in mind expansive interpretations of Wagon Mound (No 1) (Hughes; Gittani; Metrolink). Recovery for Pearl’s depression would be more difficult. She must be able to distinguish her harm as from ‘ordinary grief or sorrow’ (Tame) or mere fear. This is

satisfied as Pearl suffers from a ‘recognised depressive illness’. The board may contest this, based on the ‘fear’ component leading to Pearl’s condition. The diverse Civil Liability Acts, where relevant, must be considered to resolve this part of her claim. At common law, Pearl would rely on Kavanagh or Nader, where eggshell skull principles were employed robustly. Devil’s Peak would rely on the hurdles limiting recovery under several statutes, with respect to consequential mental harm. For example, is Pearl a person of ‘normal fortitude’, seeing that Xena thought that Pearl’s fears about Rocky were ‘irrational’? The board could correctly draw a distinction between physical and mental harm, supported by hurdles introduced by some statutes, such that a separate consideration of Pearl’s depressive illness is required. Choices about levels of abstraction may arise (Metrolink) with Pearl advocating a very broad classification. The narrow approach employed in Rowe would hinder Pearl’s claim, as the majority viewed the plaintiff’s mental harm as ‘irrational’ because it was produced by guilt feeling. [page 66] Defences (Chapters 10, 11): not relevant on these facts (b)(i) Purity versus Homestead in negligence, directly Duty of care (Chapters 5, 6) Foreseeability, outlined above, is readily satisfied: the possibility of becoming HIV positive (harm of a general character) as a result of using a dirty needle circulating at one’s place of residence, in which one-time injecting drug users are housed (including oneself) is a ‘real and not-far-fetched risk’ (Sullivan) (also bearing in mind Chapman’s relatively lenient approach). Purity’s claim against Homestead does not have some of the complications that are present in Pearl’s claim against Devil’s Peak. Purity could argue that despite the fact it is a half-way house, Homestead is similar to a prison, which has a clear duty to its inmates (Bujdoso). In that case, the duty even extended to control third party criminal conduct (prisons were highlighted in Modbury as involving a special relationship). If this is characterised as a prison/inmate relationship, it fits as a type of special or exceptional relationship — as in Smith v Leurs, endorsed in Modbury and found in Bujdoso. Homestead will contend that this is not the same as a custodial relationship, as the juvenile offenders residing in half-way houses are given a great deal of freedom. The kind of control that is present in custodial contexts is deliberately absent. However, Purity would note that in fact, in Bujdoso, the classification system accorded the detainees a great deal of freedom. Aside from the element of control, the use of other salient features may point towards finding a duty. For example, Purity would argue that Homestead had assumed responsibility for her and the other parolees (Geyer), including the control of third party criminals like Diablo. In response, Homestead would contend that Purity was not vulnerable — she was able to protect herself by not using dirty needles and not injecting drugs. Purity may respond that her addiction, preyed upon and exploited by Diablo, made her vulnerable. She would further argue that her low IQ made her ‘unable to protect herself’, unlike the sophisticated plaintiffs in Woolcock and Esanda, who had the

capacity to avoid harm. Homestead may return to control as a salient feature, contending that it did not have control over the risk of harm. In its view, Diablo, the exploiter, was in control (as was noted by Purity). Policy factors include Homestead’s argument that a duty finding would lead to defensive practices, with half-way houses employing a lot more staff to control parolees’ every movement. Breach of duty/standard of care (Chapter 3) Purity must identify the breach in this ‘direct’ action: inadequate staffing in terms of numbers and quality. Homestead is only required to respond to reasonably foreseeable risks. It ought to have known of the risk of having so few staff on duty, let alone staff who were (mere) students and not fully qualified or certified. Not employing a sufficient number of qualified staff to supervise the goings-on at the residence could produce a ‘not insignificant’ risk of harm in jurisdictions with Civil Liability Acts and ‘not far-fetched or fanciful’ at common law, especially when the reasonable person considers the circumstances — a large number of parolees with similar criminal histories. This is an essential but not sufficient requirement (Mason J in Shirt; also in the Acts). [page 67] Using the calculus of negligence under the Acts or at common law, the court has to determine how a reasonable person would respond to foreseeable risks. The probability that harm will occur is high, considering the potential for repeat criminal behaviour and potential consequences, having regard to the residents’ histories. With respect to the magnitude of potentially grave harm, this is a risk to all residents who are facing the difficulties of rehabilitation and integration. This is higher for someone like Purity (Paris) because of her unfortunate background and low IQ. The burden of practicable precautions involves having more qualified and a larger number of staff on duty. This could be costly (Hadba). Purity would argue that the potentially grave risk of harm warranted what might otherwise be seen to be costly practicable precautions (Carlton Crest Hotel). In terms of justifiability or social utility, Homestead would emphasise its efforts at rehabilitating parolees, helping them become productive, healthy members of the community. Supervising the residents too closely, with more staff for example, would inhibit their development and growth (as in Hadba). Purity would note that the Half-Way Houses Association, to which Homestead belonged, recommended more staff than Homestead provided. Even though this is not determinative, it provides good evidence that Homestead fell below what is expected of a reasonable person in the circumstances, an objective test. Further, the Association recommended the use of ‘well-trained staff’. Purity would contend that this was not met, since the evening shifts were comprised solely of students who had not been certified as social workers, as they had not completed their degrees. Purity’s illegality must be considered. Its effect will differ depending on the jurisdiction where this occurred. In Victoria, for example, her illegality is relevant when assessing Homestead’s breach. In other jurisdictions, as a specific defence, Purity’s illegality would have a more profound, negative effect on her claim. In all jurisdictions, Purity’s act of injecting illegal drugs will certainly work in Homestead’s favour.

The breach should be established, especially when one considers the grave risk of potential harm and inadequate staffing measures taken to address it, contrary to the Association’s recommendation. Causation (Chapter 4) Assuming Purity establishes a breach, did Homestead’s failure cause Purity’s harm? With respect to factual causation, was Homestead’s breach a necessary condition of Purity’s harm? Purity must prove that more staff with better qualifications would have prevented her HIV. This presumes additional staff would have stopped her interactions with Diablo, let alone anyone else who could have preyed upon her. Purity will note that she had been ‘clean’ prior to Diablo’s presence and influence. According to Purity, more staff, who were better qualified and more diligent, would have made a difference, preventing her return to drug use. Homestead would respond that Purity’s harm would have eventuated regardless of how many staff it had on duty, let alone their quality, as she was an addict. This is an awkward argument for Homestead, as it amounts to a concession that it was powerless over what went on in the establishment it managed. Nevertheless, Homestead would argue that Purity’s ‘necessary condition’ contention is too speculative: while more and better qualified staff ‘might’ have made a difference it cannot be said that it ‘would’ have done so (Adeels Palace and the provision of security — we just do not know). [page 68] Under the Civil Liability Acts, the court must determine the defendant’s ‘scope of liability’: whether or not and why Homestead’s liability should extend to Purity’s harm, invoking policy reasons and the normative effect a civil claim involving drug use would have on the criminal law (Wallace). Is Purity’s own conduct a new intervening act, as in Yates? Purity would argue that her act of injecting, using Rusty, was not intended to exploit the situation; as an addict she could not stop herself from doing what she did (similar to Haber, where the act of suicide was not viewed as volitional). Homestead would respond that having an addictive personality did not prevent the court in Yates from finding the plaintiff’s drug use to be a new intervening act. Purity may also note her inability to understand the consequences of her act, such that her conduct should not ‘break the causal chain’ (Haynes). The court may prefer using the contributory negligence doctrine to apportion responsibility rather than cutting off Homestead’s responsibility entirely, by using causation doctrine. Purity would also argue that because there was a duty to protect her from Diablo (a third party), it would be illogical for Homestead to now contend that Diablo is a new intervening act. Doing so would rob the duty of any meaning (noted in Adeels and at issue in Chomentowski). Purity would argue it would indeed be ‘appropriate’ for the scope of Homestead’s liability to extend this far (unlike Yates). There are no remoteness issues on these facts. HIV is the kind of harm a reasonable person in Homestead’s position ought to have reasonably foreseen as a consequence of sharing a dirty needle (Wagon Mound (No 1)). Defence — contributory negligence (Chapter 10) This defence is defined in Joslyn. Did Purity fail to take reasonable care of herself, by

using the dirty needle? This is judged objectively, according to the standard of the reasonable person. The objective standard will be modified, based on age, as noted in Kelly. Purity’s low IQ should be ignored, as an idiosyncrasy (as opposed to an intellectual disability that could perhaps be considered, according to obiter in Kelly and Russell). The fact that blood-borne diseases are spread by using dirty needles has been well-known for decades. This ought to have been known, in particular, to those who inject, like Purity. It is likely Purity was careless to herself (even though she is young) and this was causally connected to her harm (Hoyts). The court would apportion damages in accordance with statutorily prescribed criteria, such as what it thinks is ‘just and equitable’, based on Purity’s share of the responsibility for her harm. This involves comparing the culpability of Purity and Homestead (Pennington), including the consideration that Purity was only endangering herself, whereas Homestead was endangering all its residents (Pennington). It also involves a comparison of causal potency (Podrebersek), that is, how much each person’s negligence contributed to the harm. Despite the endangerment logic in Pennington, the court may not look kindly upon Purity, who injected herself with a dirty needle and then came to court to complain about her subsequent harm. This may be influenced by the relatively new approach which, to date, has been used primarily (but not exclusively) in New South Wales, whereby the Pennington/Podrebersek approach should not necessarily be followed. This is discussed in T and X Co Pty Ltd. Homestead may argue this is in fact the very kind of ‘rare’ case where apportionment should exceed 90 per cent (noted but not found in Zanner) or even be said to be 100 per cent (Civil Liability Acts making Hoyts [page 69] redundant). This is unlikely. However, the contributory negligence finding may be quite large. Defence — voluntary assumption of risk (Chapter 11) Homestead must show that Purity knew the facts constituting the risk, understood or appreciated the risk and freely consented to it (Scanlon). Homestead may argue ‘obvious risk’ in relation to sharing dirty needles, which, under many jurisdictions’ Civil Liability Acts, would shift the onus onto Purity to prove unawareness, which she may indeed be able to do on the basis of her low IQ. It is uncertain how this would play out. Regardless of whether or not this is an obvious risk, Homestead’s argument that Purity freely and willingly encountered the risk is destined to fail, based on her desperation to inject. Therefore, this defence cannot be established on these facts. The court is more likely to apportion loss on the basis of contributory negligence. Defence in many jurisdictions — illegality (Chapter 11) Purity’s illegal conduct could prove fatal to her claim in many jurisdictions or it could result in a reduction in her damages if she were to otherwise succeed. This is dependent on an application of the relevant Civil Liability Acts’ diverse provisions.

(b)(ii) Purity v Homestead in negligence, vicariously Negligence elements — breach focus (Chapter 3) Breach is the only issue worth highlighting in this context. The staff’s failure to control drug and dirty needle use in Homestead is arguably unreasonable. The staff will argue that there were no practicable precautions they could have taken to prevent the risk of harm, which they would concede was ‘not insignificant’, probable and grave if it materialised. They also would rely on social utility — not wanting to invade residents’ privacy. It is likely that the court will nevertheless find a breach, having regard to the magnitude of potential harm and the fact the staff knew of Rusty’s popularity. Abdicating all responsibility to do anything (they ‘resigned themselves to “their” predicament’) was irresponsible. It was unreasonable in the circumstances. Vicarious liability (Chapter 14) Was this an employer/employee or principal/independent contractor relationship? The nature of the relationship is debatable. The assessment requires a detailed application of the principle of control and other indications of employment using Hollis. Facts that point towards independent contractor status include the following: they were merely students who received course credit for working at Homestead; they were not issued with uniforms and they were not provided with any designation suggesting they were employed by Homestead; and tax was not deducted at the source. On the other hand, the fact that Homestead issued equipment (smartphones) point towards an employment relationship. Although this is not a decisive factor (Hollis) it is frequently significant. Job-related security clearances and apps were paid for by Homestead, which is indicative of an employment relationship with the right to control. Also, they were paid by Homestead (albeit token amounts). Finally, there is no evidence that they were able to delegate responsibility to others. Overall, it seems likely that the nature of the work, which appears to be regular, suggests a relationship of employer–employee. [page 70] Were the social work students acting in the course of their employment? When the social work students resigned themselves to their predicament and did nothing to prevent drug and needle sharing, this did not make them ‘strangers’ to their employment. They were still acting (or omitting to act) within the sphere of activity for which they were employed — looking after the residence and residents. At most, this was an unauthorised mode of what they were authorised to do (Deatons; Bugge). There is nothing to indicate that they were not fulfilling their other responsibilities involving the management of Homestead during the evening shifts. Ultimately, Purity’s claim is rather problematic, bearing in mind her own criminal conduct — stabbing Pearl — which led to Pearl’s harm. This will be of varying legal importance, depending on the jurisdiction in which the scenario occurred.

Problem 2 2.22 Phoenix, a 15-year-old ‘child prodigy’ and final-year Screen Studies student at Aspirationville College of the Arts (a private university that is one of Daisy Bay University’s prime competitors), was regularly featured — grinning ear-to-ear — on the university’s website and in hard copy promotional material. He was one of its ‘star’ students. At 11:00 pm on 11 November, Phoenix was no longer grinning. His partner Prewitt found Phoenix lying on the ground, severely injured and unconscious in ‘Global Gardens’, a lush parkland owned by the university. His backpack was in a bush near the path he had been walking along. The laptop several classmates had seen him using earlier that evening was stolen, as was his wallet. All that remained in his pack was his ‘Classic Hitchcock’ text, revision notes and a photo of Prewitt. The evidence suggests there was more than one assailant. Global Gardens span several long blocks, connecting the university’s main campus and residential college, Aspirationville Apartments, to the recently built Department of Screen Studies. The gardens are popular, as they provide a pleasant, convenient shortcut for students and staff. It takes only 15 minutes to walk from the Screen Studies Department to the main campus and dorm if one uses the path in the gardens; the same journey takes over 30 minutes if one uses the nearest public footpath, adjacent to Aspirationville Alley, which hugs the gardens. During the previous month, several complaints, including one from Phoenix, had been lodged with the university, expressing concerns that Global Gardens were dangerous at night because they were unlit. The university did not respond to these concerns and did not make them public. At around 7:00 pm on 11 November, Phoenix had been working on his critique of ‘Rebecca’ in the school’s archives. At around 10:15 pm, to unwind after his gruelling note-taking, he went to enjoy the faculty’s newly installed gym. Unfortunately, while in the gym, Phoenix ran into five of his less cerebral classmates, all of whom were repeating the subjects in which he had been excelling all year. Somewhat inebriated, these 22-year-olds teased Phoenix about his ‘star’ status, web profile and academic awards; they also taunted him about his relationship with his boyfriend Prewitt, with whom Phoenix had lived for over a year in a loving and [page 71] public relationship at Aspirationville Apartments. They supported one another financially. After his failed attempt at a workout, Phoenix went to shower. A few minutes later, his now quite drunk classmates followed him to the dressing room. They resumed ridiculing Phoenix, threatening to hide his clothes, flicking wet towels at him, telling him that geeks like him needed to ‘watch their bloody backs!’ Phoenix called for help. After what seemed like an eternity, but was in reality five minutes, Desmond, the gym attendant, finally answered his pleas. However, by the time Desmond arrived in the dressing room the other students had run off. Desmond lamented, ‘Bloody hell, not again!’, and told Phoenix to dry off quickly and hurry home. Phoenix did so – through Global Gardens.

Several weeks later, once Phoenix recovered consciousness, he considered instituting an action for damages in the tort of negligence for his severe and ongoing injuries. He argues that his harm was caused by the university’s carelessness in failing to provide (i) adequate and a sufficient number of safety personnel; (ii) adequate lighting; and (iii) warning signs advising students to not use the gardens at night. Unfortunately for Phoenix, he has no memory of exactly what happened when he wandered home that evening. Prewitt suffered psychiatric harm when he stumbled upon Phoenix’s unconscious body. What are the critical points a court would consider in the following actions: (a) Phoenix against Aspirationville College of the Arts? (b) Prewitt against Aspirationville College of the Arts?

Further discussion 1. Do you think the major statutory changes introduced in 2002–03 are desirable even though they generally (i) make it more difficult for many plaintiffs to succeed in negligence actions; and (ii) limit or reduce the damages that were otherwise recoverable at common law? 2. Discuss the following statement in P Cane’s article, ‘Reforming Tort Law in Australia: A Personal Perspective’ ((2003) 27 Melbourne University Law Review 649 at 650): My main argument is that, in order to gain a sound understanding of the Review, careful attention must be paid to the political environment in which it was conducted. I also suggest that, although the general ideology of the Review appears, on the surface at least, to be diametrically opposed to that which motivates proposals for no-fault compensation schemes, there is still hope that the force of the well-known and empirically supported arguments against the tort system may yet bear fruit.

3. The Ipp Panel published its Report over 15 years ago. Do you think its Report was a success? How would you evaluate ‘success’ in this context? [page 72]

Further reading Balkin R P and Davis J L R, ‘General Observations’ in The Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 1. Barker K, Cane P, Lunney M and Trindade F, ‘Introduction: Torts and Tort Law’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 1. Booth K and Varghese J, ‘Opinion: The Rush to Law Reform in Personal Injuries’ (2003) 28(5) Alternative Law Journal 210. Burns K, ‘The Australian High Court and Social Facts: A Content Analysis Study’ (2012) 40 Federal Law Review 317. Butler D, ‘A Comparison of the Adoption of the Ipp Report Recommendations and Other Personal Injuries Liability Reforms’ (2005) 13 Torts Law Journal 203. Cane P, ‘Reforming Tort Law in Australia: A Personal Perspective’ (2003) 27 Melbourne University Law Review 649. Commonwealth of Australia, Reform of Liability Insurance Law in Australia, Department of Treasury, 2004. Coonan H, ‘Insurance Premiums and Law Reform — Affordable Cover and the Role of Government’ (2002) 25 University of New South Wales Law Journal 819. Davies M, ‘Choice of Law after the Civil Liability Legislation’ (2008) 16 Torts Law Journal 104. Davis R, ‘The Tort Reform Crisis’ (2002) 25 University of New South Wales Law Journal 865. Debus R, ‘Tort Law Reform in New South Wales: State and Federal Interactions’ (2002) 25 University of New South Wales Law Journal 825. Dietrich J, ‘Liability for Personal Injuries from Recreational Services and the New Australian Consumer Law: Uniformity and Simplification, or Still a Mess?’ (2011) 19 Torts Law Journal 55.

Feldthusen B, ‘Posturing, Tinkering and Reforming the Law of Negligence — A Canadian Perspective’ (2002) 25 University of New South Wales Law Journal 854. Graycar R, ‘Public Liability: A Plea for Facts’ (2002) 25 University of New South Wales Law Journal 810. Ipp D, ‘Negligence — Where Lies the Future?’ (2003) 23 Australian Bar Review 158. Keeler J, ‘Personal Responsibility and the Reforms Recommended by the Ipp Report: “Time Future Contained in Time Past”’ (2006) 14 Torts Law Journal 48. Luntz H, ‘Reform of the Law of Negligence: Wrong Questions — Wrong Answers’ (2002) 25 University of New South Wales Law Journal 836. —, ‘Turning Points in the Law of Torts in the Last 30 Years’ (2003) 15 Insurance Law Journal 1. [page 73] Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Accident Compensation and the Law of Torts’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 1. McDonald B, ‘The Impact of the Civil Liability Legislation on Fundamental Policies and Principles of the Common Law of Negligence’ (2006) 14 Torts Law Journal 268. —, ‘Legislative Intervention in the Law of Negligence: The Common Law, Statutory Interpretation and Tort Reform in Australia’ (2005) 27 Sydney Law Review 443. Parker M, ‘Reforming the Law of Medical Negligence: Solutions in Search of a Problem’ (2003) 11 Torts Law Journal 136. Partlett D, ‘Of Law Reform Lions and the Limits of Law Reform’ (2005)

27 Sydney Law Review 507. Smillie J, ‘The Future of Negligence’ (2007) 15 Torts Law Journal 302. Spigelman J J, ‘Negligence: The Last Outpost of the Welfare State’ (2002) 76 Australian Law Journal 432. —, ‘Tort Law Reform: An Overview’ (2006) 14 Tort Law Review 5. Stewart P and Stuhmcke A, ‘High Court Negligence Cases 2000–10’ (2014) 36 Sydney Law Review 585. —, ‘Lacunae and Litigants: A Study of Negligence Cases in the High Court of Australia in the First Decade of the 21st Century and Beyond’ (2014) 38 Melbourne University Law Review 151. —, ‘The Rise of the Common Law in Statutory Interpretation of Tort Law Reform Legislation: Oil and Water or a Milky Pond?’ (2013) 21 Torts Law Journal 126. Todd S, ‘Negligence Liability for Personal Injury: A Perspective from New Zealand’ (2002) 25 University of New South Wales Law Journal 895. Underwood P, ‘Is Ms Donoghue’s Snail in Mortal Peril?’ (2004) 12 Torts Law Journal 1. Wright E W, ‘National Trends in Personal Injury Litigation: Before and After “Ipp”’ (2006) 14 Torts Law Journal 233.

1 2 3 4

D A Ipp (Chairman), Review of the Law of Negligence Report: Final Report (The Ipp Panel Report), 2 October 2002. The provisions, which differ among jurisdictions, are more detailed and nuanced than what is outlined here. The apportionment provisions, which differ among jurisdictions, are more detailed and nuanced than what is outlined here. The primary exclusion provisions are as follows: Civil Law (Wrongs) Act 2002 (ACT) s 41(2) (only excludes workplace claims); Civil Liability Act 2002 (NSW) s 3B (excludes intentional acts, sexual assault or misconduct; dust diseases; smoking or tobacco products claims; workplace claims; and some provisions relating to motor accidents are excluded whereas others are not); Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 4 (excludes workplace claims; motor accidents; dust-related conditions; and some claims related to goods); Civil Liability Act 2003 (Qld) s 5 (excludes workplace claims;

5

6 7 8 9 10

11 12 13 14 15 16 17 18 19

20 21 22

dust-related conditions; tobacco products; and exposure to tobacco smoke); Civil Liability Act 2002 (Tas) s 3B (excludes intentional acts, sexual assault or misconduct; smoking or tobacco products claims; and workplace claims; some provisions relating to motor accidents are excluded whereas others are not); Wrongs Act 1958 (Vic) s 45 (excludes motor accidents; workplace claims; dust-related conditions; and smoking or tobacco products claims); Civil Liability Act 2002 (WA) s 3A (excludes intentional acts, sexual offence or misconduct; motor accidents; workplace claims; smoking or tobacco products claims; asbestos inhalation; and civil aviation claims). The Civil Liability Act 1936 (SA) s 4(4) states that it ‘does not affect a right to compensation under the Return to Work Act 2014 (SA) [formatting amended]’. Section 94 of the Return to Work Act 2014 (SA) prescribes how the two statutes interact and how inconsistencies that may arise between the two statutes are to be resolved. J Dietrich, ‘Liability for Personal Injuries Arising from Recreational Services: The Interaction of the Contract, Tort, State Legislation and the Trade Practices Act and the Resultant Mess’ (2003) 11 Torts Law Journal 1. See note 5 above, at 2. D Ipp, ‘Negligence — Where Lies the Future?’ (2003) 23 Australian Bar Review 158 at 159. Ipp Panel Terms of Reference. H Luntz, ‘Turning Points in the Law of Torts in the Last 30 Years’ (2003) 15 Insurance Law Journal 1 at 4. H Luntz, ‘Reform of the Law of Negligence: Wrong Questions — Wrong Answers’ (2002) 25 University of New South Wales Law Journal 836 at 836. See also P Stewart and A Stuhmcke, ‘High Court Negligence Cases 2000–10’ (2014) 36 Sydney Law Review 585 at 585, where the authors, having analysed High Court decision making with respect to negligence claims over a 10-year period, assert: ‘The data in this study evidences that the application of the common law had already moved towards low rates of plaintiff success in High Court litigation prior to any impact from tort law reform legislation.’ R Debus, ‘Tort Law Reform in New South Wales: State and Federal Interactions’ (2002) 25 University of New South Wales Law Journal 825. P Cane, ‘Reforming Tort Law in Australia: A Personal Perspective’ (2003) 27 Melbourne University Law Review 649 at 669. See note 12 above at 667. See note 12 above at 668. See note 12 above at 669. K Booth and J Varghese, ‘Opinion: The Rush to Law Reform in Personal Injuries’ (2003) 28(5) Alternative Law Journal 210. See note 5 above at 1. R Davis, ‘The Tort Reform Crisis’ (2002) 25 University of New South Wales Law Journal 865 at 869. Commonwealth of Australia, Reform of Liability Insurance Law in Australia, Department of Treasury, 2004, p 11. See also H Coonan, ‘Insurance Premiums and Law Reform — Affordable Cover and the Role of Government’ (2002) 25 University of New South Wales Law Journal 819. J J Spigelman, ‘Negligence: The Last Outpost of the Welfare State’ (2002) 76 Australian Law Journal 432 at 451. See note 20 above at 451. B Feldthusen, ‘Posturing, Tinkering and Reforming the Law of Negligence — A Canadian Perspective’ (2002) 25 University of New South Wales Law Journal 854 at 855. For a critique

23 24 25 26 27 28 29 30 31

32

of the genesis of the panel’s establishment, its terms of reference and its composition, see R Davis, ‘The Tort Reform Crisis’ (2002) 25 University of New South Wales Law Journal 865. M Parker, ‘Reforming the Law of Medical Negligence: Solutions in Search of a Problem’ (2003) 11 Torts Law Journal 136 at 137. See note 5 above at 18. R Graycar, ‘Public Liability: A Plea for Facts’ (2002) 25 University of New South Wales Law Journal 810 at 810. D Ipp, ‘Negligence — Where Lies the Future?’ (2003) 23 Australian Bar Review 158 at 159. See Feldthusen, note 22 above, at 857. See note 25 above at 816. See note 12 above at 669. See Luntz, note 10 above, at 836. The civil liability statutes have been written about extensively. For a comprehensive review of these statutes, see B McDonald, ‘Legislative Intervention in the Law of Negligence: The Common Law, Statutory Interpretation and Tort Reform in Australia’ (2005) 27 Sydney Law Review 443. See also J Keeler, ‘Personal Responsibility and the Reforms Recommended by the Ipp Report: “Time Future Contained in Time Past”’(2006) 14 Torts Law Journal 48; B McDonald, ‘The Impact of the Civil Liability Legislation on Fundamental Policies and Principles of the Common Law of Negligence’ (2006) 14 Torts Law Journal 268; J J Spigelman, ‘Tort Law Reform: An Overview’ (2006) 14 Tort Law Review 5; P Underwood, ‘Is Ms Donoghue’s Snail in Mortal Peril?’ (2004) 12 Torts Law Journal 1; E W Wright, ‘National Trends in Personal Injury Litigation: Before and After “Ipp”’ (2006) 14 Torts Law Journal 233. See P Stewart and A Stuhmcke, ‘The Rise of the Common Law in Statutory Interpretation of Tort Law Reform Legislation: Oil and Water or a Milky Pond?’ (2013) 21 Torts Law Journal 126.

[page 75]

3 Standard of Care Objectives After completing this chapter, you should: — understand the ways in which fundamental common law ‘standard of care’ principles operate; — understand the fundamental common law principles underlying the objectively determined ‘reasonable person’; — understand when there can be a modification of the objective reasonable person; — understand the fundamental common law principles underlying the concept of foreseeability; — understand the fundamental common law principles underlying the ‘calculus of negligence’; — understand how some issues associated with occupiers’ liability are addressed at common law; — understand the ways in which legislative schemes have changed or reflected the common law, including the law relating to professionals, foreseeability and the ‘calculus of negligence’.

Key cases — Goldman v Hargrave [1967] 1 AC 645

— Imbree v McNeilly (2008) 236 CLR 510; 248 ALR 647 — McHale v Watson (1966) 115 CLR 199 — Mulligan v Coffs Harbour City Council (2005) 223 CLR 486; 221 ALR 764 — New South Wales v Fahy (2007) 232 CLR 486; 236 ALR 406 — Roads and Traffic Authority of New South Wales v Dederer (2007) 234 CLR 330; 238 ALR 761 [page 76] — Rogers v Whitaker (1992) 175 CLR 479; 109 ALR 625 — Thompson v Woolworths (Qld) Pty Ltd (2005) 221 CLR 234; 214 ALR 452 — Vairy v Wyong Shire Council (2005) 223 CLR 422; 221 ALR 711 — Vaughan v Menlove (1837) 3 Bing (NC) 468; 132 ER 490 — Wyong Shire Council v Shirt (1980) 146 CLR 40; 29 ALR 217

Key legislative developments Most jurisdictions’ Civil Liability or Wrongs Acts prescribe: — the framework that must be used to consider standard of care and breach issues, which is comprised of foreseeability and the reasonable person’s response to the foreseeable risk; — the effect of apologies or expressions of regret. Some jurisdictions’ Acts prescribe: — how to address inherent risks; — how to address occupiers’ liability;

— the effects of illegality and intoxication on the standard of care; — changes to the common law with respect to when and how professionals can employ ‘peer professional opinion’ to attempt to relieve them of being found in breach.

Introduction 3.1 As highlighted in Chapter 2, one of the main elements of the tort of negligence involves an assessment of the standard of care expected of the defendant and whether or not she or he has breached or failed to discharge her or his duty of care. The breach at issue (often breaches) must be specifically identified by the plaintiff. This chapter is quite lengthy, as it covers a range of considerations that must be addressed by the court when making breach determinations. They involve an examination of the standards of behaviour that are acceptable or unacceptable when a defendant goes about their business or embarks on a course of conduct. First, we note that longstanding principles have determined that the standard of care is an objective one. However, as we outline below, on occasion there can be some modifications or adjustments of this standard. We therefore consider who the reasonable person happens to be and some of the circumstances in which contentious modification issues have arisen; for example, if the defendant is a child, should her or his conduct be measured against the standard expected of a reasonable adult or a reasonable child? We then consider how the court responds when the defendant has lesser or greater levels of skill than the purely objective reasonable person. The role played by industry practice and government regulation is noted, to see how it affects [page 77]

negligence assessments, if at all. A detailed exploration of ‘professionals’ (often the medical profession) follows, with its focus on common law principles and the diverse statutory changes that have been enacted, which affect aspects of the common law in most jurisdictions. All of this must be connected to the next major segment in this chapter: what is it that should have been of concern to the reasonable person in the circumstances? We explore the nature of the risk of harm, including the concept of foreseeability. We then consider, in detail, what is expected of the reasonable person by way of response to the foreseeable, ‘not insignificant’ risk. (The Northern Territory uses a different test.) For example, can the ‘not insignificant’ risk be ignored? Or, more commonly, what would the reasonable person have done by way of taking practicable precautions against the risk of harm, bearing in mind the probability of it occurring, its seriousness if it were to occur and the social utility of the defendant’s conduct? Finally, the last segment of this chapter considers ‘additional issues’ that would have been somewhat distracting if they had been inserted at earlier points. These include the significance, if any, of calling a risk ‘obvious’, as well as specific issues associated with ‘occupiers’ liability’ (some of which arise elsewhere in the chapter). We also note the effect on the breach assessment in Victoria if the plaintiff was intoxicated or acting illegally when injured, as well as issues associated with an ‘inherent risk’, for which no liability can result in several jurisdictions. We conclude with a discussion of the effect of an apology.

The Standard of Care Stated 3.2 In the tort of negligence, to determine whether the defendant was at fault, the court measures the defendant’s conduct against a ‘standard of care’. If the defendant’s conduct falls short of that standard, she or he has been careless in the eyes of the law and therefore is at fault. If the defendant falls below the standard of care

expected of her or him, the degree of fault (also called the ‘failure’, or ‘wrongfulness’ or ‘carelessness’ or ‘negligence’) does not matter. For example, a driver who injures a pedestrian by driving carelessly (or unreasonably) at 50 kilometres over the speed limit will be liable in negligence; a driver who injures a pedestrian by momentarily taking her or his eyes off the road or texting while driving, and found to be careless (or unreasonable) in not paying close enough attention to traffic conditions, will also be liable in negligence. The assessment of damages is not dependent on the degree of the defendant’s fault, but on who the plaintiff happens to be. Therefore, degrees of fault are irrelevant (except in cases where contributory negligence or contribution among tortfeasors is an issue: see Chapter 10 and 14.34). Early in the 19th century, when the tort of negligence was still developing, it was not settled whether the standard of care should be subjective or objective. If the standard of care were to be subjective, the defendant’s conduct would be measured against the standard of what she or he was personally capable of doing. [page 78] Key Case Vaughan v Menlove (1837) 3 Bing (NC) 468; 132 ER 490 Facts: A hayrick on the defendant’s land spontaneously caught fire. The fire spread to neighbouring land, where it burned down the plaintiff’s house. The defendant had been warned by several people that the rick might catch fire because of the way it was built, but he had decided that ‘he would chance it’, and had not dismantled the rick. Issue: The plaintiff alleged that the fire had started because of the defendant’s negligence. Was the defendant careless? Decision: The jury found that the defendant had been negligent. The defendant appealed, arguing (at ER 492) that: … the jury should have been directed to consider … whether he had acted bona fide to the best of his judgment; if he had, he ought not to be responsible for the misfortune of not possessing the highest order of intelligence.

The court rejected this appeal to a subjective standard of care. Tindal CJ said (at ER 493): Instead … of saying that the liability for negligence should be co-extensive with the judgment of each individual, which would be as variable as the length of the foot of each individual, we ought rather to adhere to the rule which requires in all cases a regard to caution such as a man of ordinary prudence would observe.

3.3 Because the defendant’s conduct is judged against an objective standard, the court does not inquire whether the defendant has done her or his best to take care. Doing one’s best will not be sufficient to escape liability, if one’s best is unreasonable. The court measures the defendant’s conduct against the standard of reasonable care (in the circumstances). That standard was stated as follows by Alderson B in Blyth v Birmingham Waterworks Co (1856) 11 Ex 781 at 784; 156 ER 1047 at 1049: Negligence is the omission to do something which a reasonable man, guided upon those considerations which ordinarily regulate the conduct of human affairs, would do, or doing something which a prudent and reasonable man would not do.

Personal qualities, such as the defendant’s values or morality, are ignored in an assessment of her or his conduct, as they would clearly turn an objective test into one that is idiosyncratic and impossible to measure. The reliance on ‘external factors’ helps maintain the connection to community standards. The standard is one of ‘reasonableness’. As the New South Wales Court of Appeal highlighted in Mobbs v Kain (2009) 54 MVR 179; [2009] NSWCA 301 at [101], it is not one in which strict or absolute liability should be imposed, as doing so ‘would supplant the obligation to take reasonable care with the impermissible obligation of ensuring the respondent’s safety’. These issues are considered in detail, below. [page 79]

The Reasonable Person Gender 3.4 Most people would now agree that it is no longer appropriate to use gender-specific terminology such as ‘the reasonable man’ when describing an abstract model of rational behaviour. Nevertheless, some courts continue to do so. Faced with that fact, authors have two choices: to use the expression ‘the reasonable man’, or to translate it into gender-neutral terms such as ‘reasonable person’. In earlier editions, this book used the expression ‘the reasonable man’ with quotation marks around it, to highlight the fact that both the label and the content of the concept are anachronistic. In the many years since this book was first published, enough judges have begun to speak of ‘the reasonable person’ that it is appropriate to use that terminology to describe what they are doing. Even so, it would be a mistake to think that the content of the concept has changed much as a result. Some writers have argued that such changes in terminology mask the real issue, which is that the very notion of ‘reasonableness’ used in the tort of negligence is not gender-neutral.1

An objective standard with some of the defendant’s qualities 3.5 In order to determine what a reasonable person would or would not do in a particular situation, the court must imagine a reasonable person who has some of the qualities of the actual defendant. For example, it makes no sense to ask what a reasonable person would or would not do while performing brain surgery unless one assumes that the reasonable person is, like the actual defendant, a brain surgeon. In the case of Rogers v Whitaker (1992) 175 CLR 479; 109 ALR 625, which is considered below at 3.16, the defendant was an ophthalmic surgeon, and Mason CJ, Brennan, Dawson, Toohey and McHugh JJ said (at CLR 483; ALR 628):

The standard of reasonable care and skill required is that of the ordinary skilled person exercising and professing to have that special skill, in this case the skill of an ophthalmic surgeon specialising in corneal and anterior segment surgery.

Thus, although the standard of care is supposedly objective, there is an inescapably subjective element to it, as the court must take at least some of the qualities of the actual defendant into account. If a situation involves a ‘professional’ (or, more narrowly in Western Australia, ‘health professional’), one must examine the degree to which special statutory provisions apply. In general terms, the most significant provisions affect the weight that should be attached to what the defendant’s peers would have done. These provisions, which are intended to offer some protection to professional defendants, take precedence over relevant judge-made principles — to the extent they conflict. A detailed consideration of these provisions is deferred to 3.21–3.27, after we have first explored the fundamental common law principles (in particular, cases such [page 80] as Rogers v Whitaker and Naxakis v Western General Hospital (1999) 197 CLR 269; 162 ALR 540).

What physical and mental qualities and what capacities are or are not taken into account? 3.6 There is little consistency about which qualities of the defendant are taken into account, and which are not. It is therefore not possible to state a single principle that applies in all cases. The following cases are examples of circumstances where courts have made clear determinations as to whether or not particular qualities should be considered. The first of these is a leading High Court of Australia authority. Children: should the reasonable person standard be modified?

3.7 The following case considers whether or not a defendant’s young age is a consideration that should be taken into account when making breach determinations. Key Case McHale v Watson (1966) 115 CLR 199 Facts: The defendant was a 12-year-old boy, who threw a dart-like piece of steel at a wooden post while playing. The dart hit the plaintiff, a nine-year-old girl, in the face. Issue: Had the defendant failed to take reasonable care in throwing the dart in this way? Decision: The High Court of Australia held, by a majority of two to one, that the defendant had not been negligent. Although an adult might have been negligent if she or he had thrown the dart in the same way, the defendant, a 12-year-old, was not. Kitto J said (at 213): [A] defendant does not escape liability by proving that he is abnormal in some respect which reduces his capacity for foresight or prudence. The principle is of course applicable to a child. The standard of care being objective, it is no answer for him, any more than it is for an adult, to say that the harm he caused was due to his being abnormally slow-witted, quick-tempered, absent-minded or inexperienced. But it does not follow that he cannot rely in his defence upon a limitation upon the capacity for foresight or prudence, not as being personal to himself, but as being characteristic of humanity at his stage of development and in that sense normal.

In Zanner v Zanner [2010] NSWCA 343, an 11-year-old child, driving his mother’s car a few metres with her permission to park it in the family carport, drove into her as she was standing in front of the vehicle. The child’s foot had slipped from the brake onto the accelerator. He had previously driven his father’s car into and out of the carport five or six times, with his father in the passenger seat. In the negligence action brought by his mother, the court canvassed causation issues (see 4.9 and 4.17) and contributory negligence, finding the child’s mother 80 per cent responsible for her injuries (see 10.31). The court in Zanner also applied Imbree [page 81]

v McNeilly (2008) 236 CLR 510; 248 ALR 647 (see 3.12) and McHale, finding the child driver in breach of his duty to take care (at [60]): The act of negligence … was the failure of the … [child] to keep his foot on the brake and to prevent it slipping onto the accelerator. That was not an activity whose importance would be beyond the understanding of an 11 year old. It is a mistake that could happen to an adult as well as to a child of the first appellant’s age.

In the course of its reasoning, Zanner also considered the effect of inexperience and expected competence, which were primary concerns in Imbree. After commenting on the need to consider particular skills when assessing the standard of care owed by a specific occupation (such as medical practitioners), the High Court in Imbree had observed (at [69]), ‘[a]t the other end of the spectrum, the standard of care expected of children is attenuated’. Issues regarding the objective standard of care and when it is to be attenuated in the context of contributory negligence are considered in cases such as Town of Port Hedland v Hodder (No 2) (2012) 294 ALR 315; 43 WAR 383: see 10.14, 10.35. Mental illness: should the reasonable person standard be modified? 3.8 The following case considers whether or not a defendant’s mental illness is a consideration that should be taken into account when making breach determinations. Case Example Adamson v Motor Vehicle Insurance Trust (1957) 58 WALR 56 Facts: The defendant ran over the plaintiff while driving a stolen car. The defendant was a schizophrenic, who was suffering from delusions at the time of the accident. He believed his workmates were trying to kill him, and he was driving as quickly as he could to escape them. He ignored a traffic signal given by a traffic points man and kept on driving, knocking down the plaintiff, who was a pedestrian. The defendant was charged with various criminal offences, but the charges were withdrawn on the grounds that he was ‘insane’. The plaintiff sued, alleging negligent driving. Issue: Should the defendant’s ‘insanity’ be taken into account in these civil proceedings?

Decision: Wolff SPJ, of the Supreme Court of Western Australia, held that the defendant had been negligent. His ‘insanity’ was not taken into account, and his actions were judged according to the standard of the reasonable, ‘sane’ driver. In a sense, his insanity was treated as an idiosyncrasy, personal to that defendant: arguably, having regard to that quality would have turned the ostensibly objective test into one that was subjective.

Rationale for the different results: childhood as opposed to mental illness 3.9 The rationale justifying the different outcomes in McHale and Adamson is explored in the following case. [page 82] Case Example Carrier v Bonham [2002] 1 Qd R 474 Facts: The plaintiff, driving a bus, applied his brakes in order to avert hitting the defendant, who had suddenly jumped in front of the bus. The bus driver suffered an ‘adjustment disorder, which compelled him to give up bus driving’ (at [18]). The defendant, 45 years old, suffered from schizophrenia (diagnosed when he was 26). On the evening of the accident, he had absconded from the hospital in which he had been cared for, intending to end his life. The state, which had initially been named as a second defendant (as it was responsible for the hospital from which he had escaped) was not found negligent. Issue: Whether or not the defendant, suffering from mental illness (being of ‘unsound mind’), should be held liable for the harm caused to the plaintiff (unable to continue with his employment)? Decision: The Queensland Court of Appeal noted (at [16]) that this case raised ‘an unsettled and difficult point of law’. It concerned ‘the significance of the defendant’s mental incapacity to foresee that his actions might cause harm to someone else’ (at [33]) and the need to endorse and preserve the fundamental principle that negligence must be governed by an ‘objective standard of conduct that is independent of the idiosyncrasies of particular individuals’. McPherson JA stated (at [35]–[36]): Sir Frank Kitto’s rationalisation [in McHale] of the special category into which childhood foresight falls makes it … clear that he would have regarded unsoundness of mind as an abnormality that did not attract special exemption

from the ordinary standard of foresight and care expected of other people. … Unsoundness of mind is not a normal condition in most people, and is not a stage of development through which all humanity is destined to pass. There is no such thing as a ‘normal’ condition of unsound mind in those who suffer that affliction. It comes in different varieties and different shades or degrees. For that reason it would be impossible to devise a standard by which the tortious liability of such persons could be judged as a class. As Baron Bramwell once said, insanity is a misfortune and not a privilege. It attracts human sympathy but not, at least in the case of negligence, immunity under the law of civil wrongs. … Part … of the reason the defendant … was able to escape … is that psychiatric practice no longer insists that persons in his condition be kept in strict custody. More humane methods of treatment now prevail, under which greater liberty of movement is, for their own perceived good, permitted to patients in this unhappy state. If in the process they take advantage of that liberty to venture, even if briefly, into ‘normal’ society, it seems only proper that in the event of their doing so, their conduct should be judged according to society’s standards including the duty of exercising reasonable foresight and care for the safety of others. If that principle is not applied, then it is only a matter of time before there is reversion to the older and less humane practices of the past in the treatment of mental patients.

Applying the standard of the ordinary and reasonable person, the defendant was found civilly liable. The court concluded that his mental condition had no effect on the standard of care owed to the plaintiff. [page 83] Old age and physical impairments: should the reasonable person standard be modified? 3.10 If the defendant is elderly, it could be argued that some modification or allowance should be made when assessing the reasonableness of her or his conduct. However, it could also be argued, perhaps more convincingly, that if, for example, that person’s lack of mobility or dexterity resulting from the effects of ageing was responsible for an accident, she or he should not have undertaken the

task that caused the harm. Therefore, that person should be held to the same unqualified standard as others undertaking the activity. There are a large number of cases that consider the effects, if any, a physical impairment should have on the standard of care expected of the reasonable person in the circumstances. For example, in Scholz v Standish [1961] SASR 123, a driver who suffered severe pain from a bee sting and caused an accident, had an excuse against the claim of carelessness. If an illness is brought on suddenly, without warning, and it fully incapacitates the defendant, then it may offer the defendant an ‘excuse’. This dictated the result in Waugh v James K Allan Ltd [1964] SC (HL) 102, where the driver suffered a heart attack without warning, as a result of which he caused an accident. However, if there had been some sort of warning, by way of symptoms, then no such allowance would be made in the assessment of reasonableness. Intoxication of the defendant: should the reasonable person standard be modified? 3.11 According to South Australia’s Civil Liability Act 1936 (SA) s 31, as a ‘reasonable person’, the defendant is presumed to be sober, unless intoxicated as a result of the proper use of prescribed drugs and compliance with instructions from a doctor or drug manufacturer about what she or he should or should not do while under the influence of the drugs. In such a case, the ‘reasonable person’ against whom she or he is measured is considered to be as intoxicated as the defendant.

Experience, skill, training Lack of experience, skill or training: should the reasonable person standard be modified? 3.12 The question of whether to take the personal characteristics of the defendant into account is also difficult to resolve when the characteristics at issue are not age or mental illness, but the defendant’s lack of experience, skill or training for the activity she or he is undertaking. That lack of experience, skill or training usually

means that the defendant cannot live up to the same standard of care as an experienced or trained person. Should that personal inability to show care and skill be taken into account when the whole point of what the court is doing is to judge the defendant’s conduct against an objective standard of care and skill? For example, how should the following scenario be resolved? The plaintiff had her ears pierced by the defendant, a jeweller, at a department store. He sterilised the piercing instrument with lysol and a flame. After the operation, the plaintiff’s ear became infected and an abscess formed in her neck. She sued the jeweller, alleging that his sterilisation procedure had been negligent. He argued that it was reasonable in the circumstances, as he had used it about 150 [page 84] times per year for the past 10 years, without mishap. The plaintiff argued, and the defendant admitted, that a surgeon would have taken greater precautions. In the case in which this occurred, Philips v William Whitely Ltd [1938] 1 All ER 566, Goddard J said, ‘I do not think that he could be called on to use that degree of care’ (at 568). The standard of care to be applied was not the standard of the reasonable surgeon, but ‘the standard of care and skill that may be expected from a jeweller’ (at 568). The approach that the High Court of Australia has taken to this question in the driving context with learner drivers and supervising passengers is outlined in the leading authority, Imbree v McNeilly. Imbree overruled the High Court’s controversial decision, Cook v Cook (1986) 162 CLR 376; 68 ALR 353, where the court had held that the defendant’s conduct should be judged against the standard of the reasonable learner driver, because the plaintiff was aware of the defendant’s inexperience but chose to ride with her. The High Court in Imbree held that the decision in Cook created an unwarranted

exception to fundamental anomalous results.

common

law

principles,

producing

Key Case Imbree v McNeilly (2008) 236 CLR 510; 248 ALR 647 Facts: The plaintiff was on a road trip with a number of others, including his son and the defendant driver, a 16-year-old friend of his son. Despite knowing the driver was unlicensed and did not have a learner’s permit, he allowed him to drive his four-wheel drive vehicle. The driver lost control of the motor vehicle as he tried to avoid some debris on the highway. The vehicle rolled over, severely injuring the passenger, who had been in a ‘supervisory’ role. Issue: Is the standard of care owed by a driver to a supervisor/passenger lowered because of the driver’s inexperience and the supervisory passenger’s knowledge of that inexperience? Decision: The High Court unanimously held that the plaintiff should recover, reducing damages by 30 per cent for his contributory negligence. All members of the court except for Heydon J overruled Cook v Cook; Heydon J stated that on the facts, the need to do so was moot. The court analysed the rationale underlying its exceptional decision in Cook, questioning the correctness of that case’s ratio: that the standard of care owed by a learner driver to a passenger/supervisor who has knowledge of the driver’s inexperience should be qualified, or modified downwards. Gummow, Hayne and Kiefel JJ concluded (at [27]) that the objective standard must remain ‘the standard of the “reasonable driver” ’, which is not further qualified by having regard to experience or the possession of a driving licence. They were concerned that under the Cook principle, the defendant’s one act of carelessness can yield different results for different plaintiffs, because of the imposition of varying standards, based on who the plaintiff happens to be and their knowledge. The court stated (at [70], [72]): The principle adopted in Cook v Cook departed from fundamental principle and achieved no useful result. … The plaintiff who was supervising the learner driver, [page 85] the plaintiff who was another passenger in the vehicle, the plaintiff who was another road user are all entitled to expect that the learner driver will take reasonable care in operating the vehicle. The care that the learner should take is that of the reasonable driver. In its determination that Cook should be overruled, the High Court employed reasoning that went beyond criticism of the now discredited and abandoned ‘proximity’ methodology, which had been used repeatedly in duty of care analyses as well as Cook

(despite the fact that Cook involved issues concerning standards of care qualifications (rather than the existence of the duty)). Gummow, Hayne and Kiefel JJ observed (at [55]): To reject knowledge of inexperience as a sufficient basis upon which to found a different standard of care is to reject the only basis, other than proximity, for the decision in Cook … Yet rejection of knowledge as a basis for applying a different standard of care is required not only by the observation that knowledge of inexperience is held not to affect the standard of care owed to other passengers or other road users who observe a display of L-plates, but also by the essential requirement that the standard of care be objective and impersonal.

To sum up, the High Court of Australia in Imbree held that the High Court in Cook erred when it stated that the standard of care should be modified lower because of the plaintiff’s knowledge of the defendant’s inexperience. That type of adjustment amounted to assessing the defendant’s conduct on the basis of an idiosyncrasy, which on classic principles is incorrect. Idiosyncrasies must be ignored; otherwise, an objective assessment of reasonableness would become subjective, which is impermissible. Extra skill, training or experience: should the reasonable person standard be modified? 3.13 If the defendant has extra skill, training or experience, it may be taken into account in determining the appropriate standard of care. It seems fair and reasonable to expect an unskilled or inexperienced person to live up to the standard of the reasonably skilled or experienced person, as the defendant should not undertake the activity in question if she or he cannot perform it with reasonable care. However, it does not seem equally fair and reasonable to allow a person with greater than average skill or experience to ‘live down’ to the same standard. For example, a defendant such as an ophthalmic surgeon is expected to live up to the standard of the reasonable ophthalmic surgeon. The plaintiff can reasonably expect her or him to live up to that higher standard of care. In Imbree v McNeilly, Gummow, Hayne and Kiefel JJ stated (at [69]): The common law recognises many circumstances in which the standard of care expected of a person takes account of some matter that warrants identifying a class of

persons or activities as required to exercise a standard of care different from, or more particular than, that of some wholly general and ‘objective community ideal’. Chief among those circumstances is the profession of particular skill. A higher standard of care is applied in those cases. That standard may be described by reference to those who pursue a certain kind of occupation, like that of medical

[page 86] practitioner, or it may be stated, as a higher level of skill, by reference to a more specific class of occupation such as that of the specialist medical practitioner.

The court may also take the defendant’s extra skill into account where the plaintiff does not know about it and therefore does not expect a higher standard of care. If the defendant can subjectively do more than one could reasonably expect of a reasonable person, it seems fair to take that extra ability into account in judging the defendant’s conduct. As the following case explains, the court does not take into account the defendant’s specific level or extent of skill, training or experience, thereby judging whether the defendant has performed to the best of her or his ability. Doing so would be a return to a purely subjective test and be equivalent to taking into account an idiosyncrasy — which is meant to be ignored. It considers what a reasonable person with the defendant’s extra skill, training or experience would or would not have done. Case Example Heydon v NRMA Ltd (2000) 51 NSWLR 1 Facts: A barrister, two solicitors and their firms’ partners gave advice with respect to the restructuring of a corporate group. The lawyers providing advice (including the prospectus) were acknowledged corporate law experts. The advice was given prior to the High Court handing down its decision in a significant Corporations Law case, Gambotto v WCP Ltd (1995) 182 CLR 432; however, the advisers were aware that special leave to appeal had been granted by the High Court. The legal advisers were sued for professional negligence. Issue: Were the advisers liable for failing to follow up the special leave application and

for not warning the NRMA that this case might affect its proposed restructure? Or did they act reasonably? Decision: The trial judge decision finding them liable was reversed by the New South Wales Court of Appeal. It found no breach, as the defendants had acted reasonably. McPherson AJA stated (at 117–18): Both branches of the profession [barristers and solicitors] owe a duty of care to their clients … [T]hey are bound to have and to exercise a degree of skill and care that is to be expected of persons professing and practising in their area of expertise: see Rogers v Whitaker … In terms of reputation and prominence, the defendants were and are among the leaders of the profession in the field of company law, and especially, in Mr Heydon’s case, trade practices law. This, it was submitted … had the consequence that they were to be judged by more exacting standards than others of lesser ability in the same field of expertise; but that is plainly neither good law nor sound policy. It would penalise those who were better at doing the same work, and reward increasing proficiency with progressively heavier liabilities. There is only one standard, which is the standard appropriate to a member of the profession with the relevant special skills … … In giving advice, a lawyer does not warrant or guarantee the soundness of his or her opinion but only that the requisite degree of skill and care has been used in arriving at [page 87] it … [Here], where the professional negligence is alleged to consist, at least in part, in failing to warn of a risk that legal advice given to a client might turn out to be mistaken, a lawyer is not normally required to warn experienced business clients of the possibility that his opinion, though firmly held, may not in fact prevail …

Heydon’s case has been followed a number of times in relation to the standard of care of a reasonable barrister or solicitor. In Goddard Elliott (firm) v Fritsch [2012] VSC 87, Bell J of the Supreme Court of Victoria held that the defendant lawyer failed to exercise the requisite skill necessary to judge his client’s mental capacity to give instructions to settle a case. In Victoria, s 58 of the Wrongs Act 1958 (Vic) states that an assessment of the standard of due care in a case involving a person who holds herself or himself out as possessing a particular skill is to be determined by reference to what could reasonably be expected of a

person possessing that skill at the time of the alleged negligence. Bearing in mind the common law’s position, the effect of this provision is unremarkable. Section 40 of the South Australian Civil Liability Act 1936 (SA) confirms the common law. In South Eastern Sydney Area Health Service v King [2006] NSWCA 2, using common law principles, the court considered the standard of care of a particularly highly skilled specialist and what was considered ‘reasonable’ in the context of a tragic, complex medical negligence case.

General Practice, Custom and Regulation Defendant’s compliance or non-compliance with a general practice or custom 3.14 It may not be enough for the defendant simply to show that she or he has done as others commonly do. At common law, following the recognised and general practice in a particular profession or industry may in itself be a failure to live up to the standard of reasonable care, as all those who follow that practice may be guilty of negligence. For example, even though drivers commonly drive in excess of the speed limit, this does not mean that it is reasonably safe to exceed the speed limit. The court ultimately judges the defendant’s conduct against the standard of the hypothetical reasonable person, not against the conduct of others. Case Example Mercer v Commissioner for Road Transport and Tramways (NSW) (1937) 56 CLR 580 Facts: The plaintiff was injured when the defendant’s tram crashed because the driver had collapsed at the controls. The defendant did not install a device known as [page 88] a ‘dead man’s handle’, to cut off the motor automatically. The defendant adduced

expert evidence that such a device was not in use in any other tramway system. Issue: Did the defendant act unreasonably by not guarding against the danger of a driver’s collapse by not installing this device? Decision: By a majority, the High Court of Australia held that the defendant was liable in negligence for failing to fit such a device. Rich, Evatt and McTiernan JJ said (at 593–4): [I]t was suggested that no jury should be permitted to say that the ordinary methods commonly adopted by those in the same business as the defendant can constitute negligence on the defendant’s part. But, as has been clearly pointed out, ‘the general practice itself may not conform to the standard of care required of a reasonably prudent man. In such a case it is not a good defence that the defendant acted in accordance with the general practice’ (Salmond (ed Stallybrass) on Torts, 9th ed (1936), at p 462) … Accordingly, reference to present practice in other tram systems is necessarily of less significance.

Case Example Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460; 186 ALR 145 Facts: An indoor cricket player suffered a serious eye injury while playing cricket in the facility operated by the defendant, who was also the game’s organiser. The player was not provided with a helmet; no signs were posted warning players of the risks associated with playing indoor cricket. Issue: Did the defendant breach its duty by (i) failing to provide players with helmets to prevent eye injury and (ii) failing to warn of the risk of eye injury when playing indoor cricket? Decision: The High Court of Australia, in a three to two decision, upheld the decision of the Full Court of the Supreme Court of Western Australia and the trial judge, dismissing the injured player’s appeal. The court considered, in detail, how indoor cricket is played and evidence about the particular incidence of eye injuries sustained in this sport. With respect to industry practice and the rules of the game, Gleeson CJ noted (at [23], [26], [28]): The evidence showed, not only that there were no helmets designed for indoor cricket, and that they are not usually worn in playing the sport, but that the rules of the game actually discourage the use of helmets, requiring a player who wants to wear a helmet (for example, because of a special medical condition) to obtain permission to do so … French DCJ pointed out that it was not a question of uncritical conformity to a bad example set by others who provided similar facilities … The fact that players at the respondent’s facility were not provided with helmets was in accordance with general practice, and with the rules

according to which the sport was played. French DCJ did not suggest that the rules of the game, or the practice of indoor cricket players, or other operators of indoor cricket facilities, concluded the question she had to decide, but she saw them as factors to be taken into account in assessing what was required by the standard of reasonableness. [page 89] The court was careful to note that while custom was important evidence of reasonableness, it was not determinative of that issue. However, great weight was accorded to what others in the industry did and the rules of the Australian Indoor Cricket Federation. Callinan and McHugh JJ (dissenting) were also at odds with respect to another issue: McHugh J favoured the admissibility of statistical or social scientific reports concerning the cost of injury to the community, bearing in mind the emphasis he placed on accident prevention, whereas Callinan J did not. For further discussion of this case, see 3.52.

More recently, Roche Mining Pty Ltd v Jeffs [2011] NSWCA 184 demonstrated that when assessing the standard of care, evidence of industry practice is not necessarily decisive; the practice may itself be negligent if it does not incorporate new safeguards. In this case, the plaintiff fell approximately 2.5 metres while climbing into a dump truck at work. Breach of duty was found, as the employer’s attempt to devise a system of ‘requiring drivers to keep a three point hold at all times’ was an inadequate response to the significant risk of injury. While the defendant’s approach conformed to industry practice, and there had been no reports of other falls from the ladder prior to the plaintiff’s injury, these were not determinative to show an absence of breach. At [75], McColl JA cited Latham CJ in Mercer, noting that while conforming to industry practice is important, this does not necessarily establish an absence of negligence. According to McColl JA (at [76]), ‘common practice was not necessarily prudent practice’. Similarly, in Erwin v Iveco Trucks Australia Ltd (2010) 267 ALR 752; [2010] NSWCA 113, the New South Wales Court of Appeal (Sackville AJA, with Basten and Campbell JJA agreeing) also cited Mercer and observed (at [87]) that ‘evidence of adherence to common practice in

an industry, although important, is not necessarily determinative of whether a breach of duty has occurred’. In Vella v Permanent Mortgages Pty Ltd [2008] NSWSC 505, Young CJ stated (at [492]–[493]): When dealing with professional negligence, some obvious points must be stated because sometimes they tend to be overlooked. The first is that a professional advisor is not an insurer. Doubtless the client expects that if the ‘paperwork’ is entrusted to a solicitor, the paperwork that results will be effective. The solicitor must use his or her best professional skills to bring that about, but the mere fact that the result is disastrous to the client does not mean necessarily that the solicitor was negligent. At the other extreme, putting aside the operation of s 5O of the Civil Liability Act 2002 [see 3.21–3.27], the fact that there is a general practice of solicitors to do or not to do a certain thing does not of itself negative negligence if the thing is done or not done by the solicitor in question …

It is important to note that the concept of foreseeability of the risk of injury is central to the standard of care question: see 3.28–3.36. At present, with respect to foreseeability, it is sufficient to note that the court assesses the knowledge that has [page 90] to be taken into account when determining what a reasonable person would or would not do in a particular situation. In this way, the standard of reasonable care depends on the knowledge that the defendant actually has or ought to have. What the defendant knows, or ought to know, shapes the risks of injury that she or he can foresee and the action that she or he takes as a result.

Breach of regulations: not determinative 3.15 What a reasonable person would or would not do in a particular situation is a question that must be determined by the fact finder, guided by legal principles. As we have noted, at common law, industry standards or the custom of the trade or profession are not determinative of reasonableness (although they do provide useful evidence of that standard). Similarly, statutory standards of careful

conduct are evidence of what constitutes reasonable care for the purposes of the common law, but they are not conclusive. For example, road traffic legislation provides for speed limits on the roads. Exceeding the speed limit is a criminal offence, and the driver may be prosecuted and punished for doing so, but the statutory speed limit is not conclusive of what is a safe speed for the purposes of the common law. It is very persuasive evidence of what is a reasonably safe speed, but that is all. Case Example Tucker v McCann [1948] VLR 222 Facts: The plaintiff was the pillion passenger on a motorcycle, and the defendant was the driver of a motor car. The plaintiff was injured when the defendant’s car collided with the motorcycle at a traffic intersection. Issue: The plaintiff alleged, among other things, that the defendant was negligent because he had breached the road traffic regulations by approaching the intersection too quickly. Decision: The jury found that the defendant had not been negligent. The plaintiff appealed, arguing that the defendant must have been negligent if he had breached the regulations. By a majority of two to one, the Full Court of the Supreme Court of Victoria upheld the jury’s verdict. Herring CJ (with whom Lowe J agreed) said (at 225): Now it is the duty of everyone to know and to obey the law, and so to know and obey the precautions laid down in the regulations. And prima facie a reasonably prudent man will take them. And whenever a person is under a duty to someone else to take care, his failure to take those precautions or any of them is a matter that must be taken into account in determining the question of whether he has or has not exercised due care. But this question is one of fact to be determined in the light of all the circumstances, and a breach of the regulations is only one of such circumstances. Such a breach must, therefore, be considered along with all the facts of the case, it cannot be considered in vacuo as it were. It is thus no more than a piece of evidence of want of reasonable care … Circumstances may be conceived in which obedience to the regulations may as a matter of prudence be the very worst course to take, eg, where to disobey may [page 91] avoid injury or save life. In other words it is for the jury to say whether the precaution laid down by regulation, which the defendant failed to take, was one

that in all the circumstances of the case a reasonably prudent man would have taken. It is for them to decide for themselves as a matter of fact the standard of care that was appropriate in the circumstances.

This basic proposition has frequently been endorsed. For example, in Talbot-Price v Jacobs [2008] NSWCA 189, Ipp JA cited several authorities (including Tucker v McCann) to support the following comment (at [56]): It has long been the law that breach of a statute or regulation may be evidence of negligence but it is not irrefutable proof of negligence. Every case has to be decided according to its own circumstances. The breach of a statute or regulation is not definitive of a duty of care, or the performance of that duty.

Other provisions that set safety standards may also be taken into account in determining the common law standard of reasonable care, but they too are only evidence of what a reasonable person would or would not do in the circumstances of the case. For example, safety provisions in industrial awards may be used as evidence (but not conclusive evidence) of what a reasonable person would or would not do in the circumstances. Case Example Fox v Hack [1984] 1 Qd R 391 Facts: The plaintiff injured his back at work while engaged in repetitive lifting of building blocks weighing about 28 kg. The industrial award governing the plaintiff’s employment provided that no employee should be required to lift a building block in excess of 45 lb (20.45 kg) without a mechanical aid or assistance from another employee. Issue: The employee sued his employer, alleging that it had been negligent in failing to provide a reasonably safe system for the shifting of building blocks. Decision: The employer was held to have been negligent according to the common law standard of reasonable care, as evidenced by the industrial award. Carter J said (at 393–4): I am satisfied … that such a provision which governs conditions of employment in the building trade is admissible in a case such as this … Such provisions are admitted not as ones having statutory force … but as evidence of what might be said to be a standard or norm of behaviour reasonably required of an employer when involving his employee in a particular task. … The terms of the relevant

provision is [sic] clearly designed as a standard of behaviour to be expected of an employer … The provision outlined in the [Industrial] Award is in my opinion a reasonable one and may be taken to evidence a reasonable standard of care to be expected of an employer in the building trade.

[page 92] Case Example Ascic v Westel Co-operative Ltd (1992) Aust Torts Reports ¶81-159 Facts: The plaintiff was employed by the defendant as a bottle packer. She had to lift and carry crates of bottles weighing up to 25 kg. Industrial awards governing other kinds of employment specified that female employees should not be required to lift weights of more than 16 kg at any one time, but there was no such provision in the award governing the plaintiff’s employment. Issue: Can the court take into account the weight limits set in other awards, even though they did not bind this employer and employee? Decision: Citing Fox v Hack, the trial judge took those other awards into account in determining what the reasonable employer would or would not have required the plaintiff to do; the defendant was held to be liable in negligence. Dismissing the defendant’s appeal, the Full Court of the Supreme Court of Western Australia held that the trial judge was entitled to take into account the weight limits set in other industrial awards, even though they did not bind the plaintiff and defendant. Pidgeon J said (at 61,231) that the non-binding awards could properly be used ‘as an indication of a standard reasonably required of an employer when involving his employee in a particular task’.

Although Carter J stated, obiter, in Fox v Hack that the safety standards promulgated by the Standards Association of Australia (SAA) are admissible in civil actions, the Full Court of the Supreme Court of South Australia in Chicco v Woodville Corporation (1990) Aust Torts Reports ¶81-028 held that they are not (except those that are given statutory force, as some are). Millhouse J stated (at 67,897): The Standards Association is not a government body nor one with any ‘official’ standing. Most of its publications, so far as I know, have no particular standing in

law … The standards are merely the expressions of people speaking under the aegis of the association … [S]uch a standard is not evidence.

Professionals and Statutory Changes (Bolam, Rogers, Naxakis) The common law abolition of the ‘Bolam test’ 3.16 Courts often have to decide what a reasonable person would have done in the light of technical knowledge far beyond that possessed by the judge or the jury. How can a judge decide what the reasonable surgeon would do in the middle of a complex operation? She or he must obviously rely on evidence from expert witnesses on what would be appropriate behaviour in the circumstances. But what if the expert witnesses disagree? How is the court to determine what a reasonable person would have done in a particular situation if experts with qualifications similar to the defendant’s disagree about what ought to be done? These controversial issues [page 93] have long troubled the common law. They have been the subject of significant legislative intervention. In medical negligence cases, courts used to apply a test known as the Bolam test, which derived from McNair J’s direction to the jury in the English case, Bolam v Friern Hospital Management Committee [1957] 1 WLR 582. The Bolam test was described as follows by Lord Scarman in Sidaway v Governors of the Bethlem Royal Hospital [1985] AC 871 at 881: The Bolam principle may be formulated as a rule that a doctor is not negligent if he acts in accordance with a practice accepted at the time as proper by a responsible body of medical opinion even though other doctors adopt a different practice.

In effect, the Bolam test meant that the court had to hold that the defendant doctor was not negligent if some of the expert witnesses (‘a

responsible body’) said that she or he acted properly in the circumstances. The Bolam test had been applied in Australia (see, for example, Dwan v Farquhar [1988] 1 Qd R 234). However, in the next case and leading authority, Rogers v Whitaker and a subsequent significant decision, Naxakis v Western General Hospital, the High Court of Australia held that Bolam should not be applied in cases of medical negligence. Key Case Rogers v Whitaker (1992) 175 CLR 479; 109 ALR 625 Facts: The plaintiff was blinded in her right eye when she was nine years old. When she was 47, the defendant, an ophthalmic surgeon, operated on her right eye. The surgery was essentially cosmetic, although there was a good chance that significant sight would be restored to her eye. The plaintiff asked the defendant many questions about possible complications affecting her right eye, but she did not ask if any complications might affect her other eye. In fact, there was a small risk (about one in 14,000) of sympathetic ophthalmia causing blindness in the plaintiff’s good eye. Although the defendant was aware of this risk, he did not mention it to the plaintiff. As a result of the operation, the plaintiff suffered sympathetic ophthalmia, and was blinded in her left eye. The evidence established that there was a considerable body of medical opinion to the effect that an ophthalmic surgeon should only advise a patient of the risk of sympathetic ophthalmia if the patient specifically asked about the possibility of a risk to the good eye as a result of the operation on the bad eye. Issue: Was the doctor negligent when he failed to warn Ms Whitaker of the risk of blindness? Decision: The High Court of Australia held that although the Bolam test might be appropriate in cases of diagnosis or treatment, it should not be applied in cases involving the provision of advice or information from doctor to patient. Mason CJ, Brennan, Dawson, Toohey and McHugh JJ considered a shortcoming of applying the Bolam test in such circumstances (at CLR 486–7; ALR 630–1): … even if a patient asks a direct question about the possible risks or complications, the making of that inquiry would logically be of little or no significance; medical opinion [page 94] determines whether the risk should or should not be disclosed and the express desire of a particular patient for information or advice does not alter that opinion or the legal significance of that opinion … The existence of the shortcoming

suggests that an acceptable approach in point of principle should recognise and attach significance to the relevance of a patient’s questions … [I]n the field of non-disclosure of risk and the provision of advice and information, the Bolam principle has been discarded and, instead, the courts have adopted the principle that, while evidence of acceptable medical practice is a useful guide for the courts, it is for the courts to adjudicate on what is the appropriate standard of care after giving weight to ‘the paramount consideration that a person is entitled to make his own decisions about his life’. [Quoting F v R (1983) 33 SASR 189 at 193.] In cases involving the provision of information or advice about the risks in a proposed procedure, the following test should be used in place of the Bolam test (at CLR 490; ALR 633–4): The law should recognise that a doctor has a duty to warn a patient of a material risk inherent in the proposed treatment; a risk is material if, in the circumstances of the particular case, a reasonable person in the patient’s position, if warned of the risk, would be likely to attach significance to it or if the medical practitioner is or should reasonably be aware that the particular patient, if warned of the risk, would be likely to attach significance to it. In this case, the plaintiff’s keen interest in the risk to her bad eye made it clear that she would be even more concerned about possible complications affecting her good eye. The court held that the defendant should have been aware that the plaintiff would have regarded the risk of sympathetic ophthalmia as material, and should have advised her of that risk, even though she did not specifically ask about it. The court did, however, hold that a doctor could withhold information on the basis of ‘therapeutic privilege’, in relatively rare situations where the provision of information will harm the patient, for example, an unusually anxious, disturbed or volatile patient. Gaudron J stated that this exception should be severely restricted.

Rogers v Whitaker has frequently been applied. For example, the common law duty of a medical practitioner to warn a patient of the ‘material risk’ of injury was considered in Wallace v Kam (2013) 250 CLR 375; 297 ALR 383, a leading High Court case concerning the relevance of policy to causation inquiries (see 4.3, 4.4, 4.26). 3.17 In Rogers v Whitaker, the majority stated (at CLR 489; ALR 632) that to discard the Bolam principle in cases involving the provision of information or advice would not amount to creating ‘an artificial division or itemisation of specific, individual duties, carved out of the overall duty of care’. The court continued: The duty of a medical practitioner to exercise reasonable care and skill in the

provision of professional advice and treatment is a single comprehensive duty. However, the factors according to which a court determines whether a medical practitioner is in breach of the requisite standard of care will vary according to whether it is a case involving diagnosis, treatment or the provision of information or advice; the different cases raise varying difficulties which require consideration of different factors.

[page 95] It appeared (to commentators, for example) that the High Court had rejected Bolam with respect to the provision of advice and information, but not with respect to diagnosis and treatment. However, in Naxakis v Western General Hospital, the High Court concluded that Bolam was not to be followed in any case involving medical care — whether it involves diagnosis, treatment or the provision of information. Interestingly, in doing so, the High Court treated this comprehensive rejection as if it were self-evident, without adverting to the concerns that had previously been expressed, which had questioned the scope of Rogers’ rejection of Bolam. 3.18 The following case, again involving professional negligence in a medical context, was decided before the Civil Liability Act 2002 (NSW) applied. It illustrates the difficult judgment calls presented to health professionals such as emergency workers, and the complex nature of breach assessments by the fact finder. Case Example Ambulance Service of New South Wales v Worley [2006] NSWCA 102 Facts: A postal worker, stung by a bee, had an allergic reaction. He returned to the mail delivery centre on his motorcycle, where the manager rang an ambulance. The treating paramedic diagnosed him with anaphylaxis, noted his symptoms and administered adrenaline intravenously, in accordance with a protocol he believed was appropriate. The worker suffered an intracranial haemorrhage, either during or immediately after the treatment, consequently suffering right-sided hemiplegia and physical difficulties. Issues: The breach issues were: (i) in 1998, when the incident occurred, was it careless to allow a paramedic to administer adrenaline intravenously to a patient suffering an

anaphylactic reaction ‘unless the patient was on the point of death’?; (ii) if it could be administered when the individual is in severe shock, was this in fact the plaintiff’s condition?; and (iii) was it administered incorrectly (too fast, or too great a dose without proper monitoring)? Decision: The court sensibly noted (at [29]), that ‘Ambulance officers are not medical practitioners, let alone specialists in emergency medicine. Their training is by no means insignificant, but it does not equip them with the theoretical knowledge which would permit the fine evaluation of alternative treatments’. Therefore, the paramedic’s conduct had to be measured against an appropriate cohort, with the skills expected of that professional. However, the court stated that just because the defendant followed the profession’s ‘accepted practice’, this is not determinative of the standard, as evidence could (potentially successfully) call the reasonableness of that practice into question. The court held that the treatment was not careless, as the ambulance officer did not ‘choose’ the dose or rate at which the adrenaline was administered. He was simply following the relevant protocols in accordance with his training and directions from the Ambulance Service. Further, the officer did not act unreasonably [page 96] in his understanding and application of the protocols on these facts: ‘given the … expectations of ambulance officers … and the symptoms of anaphylaxis (as compared with asthma) it seems inherently unlikely that the protocols were intended to impose on ambulance officers an obligation to determine how close a seriously compromised and deteriorating patient was to death’ (at [72]). The plaintiff also failed to establish that the protocols’ content was not as up-to-date and scientifically accurate as they ought to have been; the evidence did not support the allegation that a change was reasonably required. The court concluded (at [154]) that the plaintiff was a ‘most unfortunate victim of misadventure … entitled to receive benefits in the nature of workers compensation, for an injury suffered in the course of employment. He is not, however, entitled to damages for negligence on the part of the Ambulance Service.’

More recently, Waller v James [2015] 90 NSWLR 634; [2015] NSWCA 232 was decided under common law principles because the alleged negligence pre-dated the enactment of the Civil Liability Act 2002 (NSW). It involved a failure to provide pre-pregnancy advice. Described as a ‘wrongful birth’ case, Mr and Mrs Waller consulted Dr James, a gynaecologist and IVF specialist, in relation to IVF treatment. Dr James referred them to a genetic counsellor by writing details on a post-it note. However, he did not explain why he was referring them to the counsellor. The Wallers did not see the counsellor. Mrs Waller gave birth to their son, Keeden, by IVF. He was born with anti-

thrombin deficiency (ATD), inherited from his father, and suffered a neonatal stroke four days after birth that left him with permanent disabilities. The New South Wales Court of Appeal (Beazley P (McColl and Ward JJA agreeing)) held (at [144]) that Dr James breached his duty by failing to adequately explain the reasons for referring Mr and Mrs Waller to a genetic counsellor. However, the claim failed on causation, as the court held (at [204], [208]–[210]) that the harm was too remote to be recoverable: see 4.56. 3.19 Although Rogers (see 3.16) was concerned with medical negligence, it was applied in cases involving other professions, as authority for the proposition that the standard of reasonable care for a professional is not to be determined solely by reference to evidence about the practice of reputable professionals in that field, but is ultimately one for the court to determine (see, for example, Walter Fregon Pty Ltd v Sewell (VSC, Coldrey J, 20 November 1996, unreported, BC9605901) (veterinary surgeons); John Holland Construction & Engineering Pty Ltd v Majorca Projects Pty Ltd (1996) 13 BCL 235 (architects); Hagen v Ian Heraud & Associates Pty Ltd (1998) 39 ATR 336 (financial advisers); Flemington Properties Pty Ltd v Raine and Horne Commercial Pty Ltd (1998) 148 ALR 271 (valuers)). Cases of this nature must now be considered under the civil liability statutes. In some jurisdictions, in certain circumstances, the importance of peer professional opinion has been heightened under these Acts. This is explored below. [page 97]

The Ipp Panel’s recommendations for change 3.20 The Ipp Panel (see 2.13–2.19) gave a great deal of attention to considering standard of care (and related) issues in the context of professional negligence. With respect to medical negligence scenarios, it drew a distinction between (i) treatment and (ii) provision of information about treatment, and recommended that the law should

respond in different ways to these different types of situations. It also considered whether its recommendations should be extended to cover non-medical professionals. To determine the standard of care in treatment cases involving medical practitioners, the Panel stated that legislation should be enacted to provide a test that amounts to a modified version of Bolam (in terms similar to those used in the House of Lords decision, Bolitho v City and Hackney Health Authority [1998] AC 232). The practitioner should not be liable ‘if the treatment was provided in accordance with an opinion widely held by a significant number of respected practitioners in the field, unless the court considers that the opinion was irrational’. The Panel recommended that with respect to other professionals, the possibility of returning to (a modified) Bolam principle be left to the courts for determination. In the Panel’s view, information provision required a different response, involving proactive and reactive duties to inform. Its recommendations in this context did not extend to other service providers who had duties to provide information, because the nature and scope of those duties derived from a different historical basis than was the case with medical practitioners. The Panel also suggested that consideration be given to trialling a system of court-appointed experts to avoid some of the welldocumented problems associated with litigation and the perception that, in many instances, the parties’ zealous experts provide conflicting, sometimes slanted testimony.

Legislative intervention 3.21 The Panel’s recommendations have had varying degrees of uptake by legislatures throughout the country. If a situation involves a ‘professional’ or, in Western Australia, ‘health professional’, one must examine the degree to which special statutory provisions apply. In general terms, the most significant provisions affect the weight that should be attached to what the defendant’s peers would have done in certain contexts. These provisions, intended to offer some protection to

this type of defendant, take precedence over relevant judge-made principles, to the extent they conflict. Providing a service — the provisions 3.22 To date, the Australian Capital Territory and Northern Territory have not enacted ‘peer professional opinion’ provisions to modify the common law. The Australian Capital Territory does, however, prescribe the role of an expert in a medical case, as impartial and not a party’s advocate. When giving evidence about treatments, the expert must have regard to whether the treatment was in [page 98] accordance with an opinion widely held by a significant number of respected Australian practitioners, in the relevant field.2 The other jurisdictions, except for Western Australia (whose Act is directed at ‘health professionals’, as was noted above) enacted legislation that goes further than the Ipp Panel’s recommendations by enacting a version of the Bolam test for all professionals. In New South Wales, South Australia and Tasmania, a professional does not incur liability in negligence arising from the provision of a professional service if it is established that the professional acted in a manner that, at the time the service was provided, was widely accepted in Australia by peer professional opinion3 as competent professional service.4 Young CJ, of the New South Wales Supreme Court, explored what is meant by ‘widely accepted’ in Vella v Permanent Mortgages Pty Ltd, a case that arose in a non-medical context involving practices used to draft mortgages in New South Wales. His Honour stated (at [553]– [555]): I consider it is too restrictive a way of approaching s 5O to say that unless there is a peer professional practice throughout the whole of Australia the section cannot apply. For instance, if one was working out the duty of care of a tender of a boab tree which as far as I know only grows in the north west of Australia, it surely could not have been the legislature’s intention that s 5O would be completely inapplicable. Rather, it

would accord with the intention of the legislature if one said that where one had an industry which was only practised in part of Australia that that part was the Australian peer professional practice for the purpose of s 5O. Likewise, if one has different though similar professions in different parts of Australia, it would seem to me that one does not dismissively say there is no Australian professional practice but one looks to see the professional practice that exists in the particular locality where the negligent act or omission took place. There may also be other problems where, for instance, things would be done differently on King Island in Tasmania from Thursday Island in Queensland because one is in the cold wet south and the other is in the monsoonal north.

In Queensland and Victoria, the phrase ‘by a significant number of respected practitioners in the field’ is added after ‘peer professional opinion’.5 It appears that this additional requirement makes the standard more stringent in Queensland and Victoria than in the other three states, even though Queensland’s and Victoria’s statutes do not provide guidance on how to determine what is a ‘significant number’. The provisions in New South Wales, Queensland, South Australia, Victoria and Tasmania apply to any ‘person practising a profession’6 — a rather unhelpful description. Clearly, doctors are professionals; so too are nurses, accountants, [page 99] engineers and teachers. One might well ask, ‘what about painters, plasterers, plumbers and electricians?’. The legislation in Western Australia has the same effect as that in New South Wales, South Australia and Tasmania. However, it is confined to ‘health professionals’,7 which is defined as including dentists, chiropractors, nurses, occupational therapists, optometrists, physiotherapists, podiatrists and registered psychologists.8 In New South Wales, Queensland, South Australia and Tasmania, the professional cannot rely on peer professional opinion if the court considers that opinion to be ‘irrational’.9 Therefore, if the defendant justifies her or his conduct as in accordance with peer professional opinion, the plaintiff then can attempt to argue it was ‘irrational’.

The equivalent provision in Victoria states that peer professional opinion cannot be relied on if the court determines that the opinion is ‘unreasonable’,10 a threshold requirement that certainly appears to tame the effect of the substantive legislative change regarding the use of peer professional opinion in that state. When compared to Acts using the concept ‘irrationality’, the Victorian section preserves more of the court’s discretion to make its own determination of acceptable practice, as in Naxakis v Western General Hospital. Similarly, the Western Australian Act provides that a health professional may be held liable if the practice in question was so unreasonable that no reasonable health professional could have followed it.11 The Western Australian statute also underscores the fact that the onus remains on the plaintiff to prove the relevant breach.12 Warnings, advice or other information — the provisions 3.23 Significantly, in New South Wales, Queensland, Victoria and Tasmania, the peer professional opinion provisions do not apply to liability arising in connection with the giving of (or the failure to give) a warning, advice or other information in respect of the risk of harm to a person associated with the provision of professional advice.13 The equivalent provision in South Australia only excludes the operation of the professional opinion section in relation to a warning, advice or other information associated with the provision of a health care service.14 Similarly, the Western Australian statute preserves the common law, with respect to ‘a health professional’ who informs ‘a person of a risk of injury or death [page 100] associated with the treatment proposed for a patient or a foetus being carried by a pregnant patient’.15 The effect of these provisions is that, in general terms, the common

law (as stated in Rogers v Whitaker) continues to apply in relation to the duty to give warnings, advice or other information (with limitations in certain jurisdictions with respect to who is deemed a professional). Queensland and Tasmania specifically prescribe medical practitioners’ proactive and reactive duties to warn of risks. In Queensland, a doctor does not breach a duty to a patient to warn of a risk of injury before the patient undergoes medical treatment or is given advice unless the doctor fails to give the patient information about the risk that a reasonable person in the patient’s position would require, in order to be able to make a reasonably informed decision to undergo the treatment or follow the advice.16 This also applies to information the doctor knows or ought reasonably to know the patient wants to be given, before making the decision to undergo the treatment or follow the advice. Tasmania’s equivalent provision does not apply to cases where the patient is unable to hear or respond to a warning about the risk of harm and there is no time to contact a person responsible for making a decision for the patient.17

The upshot 3.24 As a result of these statutory changes, at face value, it appears that plaintiffs’ ability to succeed in negligence actions against professionals with respect to the provision of services has diminished. In Freidin v St Laurent (2007) 17 VR 439, the patient successfully sued her obstetrician and gynaecologist. This complex claim was decided by the Victoria Court of Appeal in accordance with common law doctrine. With respect to the then newly-introduced Victorian statutory provisions, Callaway JA observed (at [5]–[6]): It was open for the jury to find that Dr Freidin was negligent in accordance with the law as it then stood. That was not a foregone conclusion. Moreover the law has since changed. Since 2003, s 59 of the Wrongs Act 1958 [Vic] has provided that a professional person is not negligent in providing a professional service if he or she acted in a manner that, at the time the service was provided, was widely accepted in Australia by a significant number of respected practitioners as competent professional practice. Such peer professional opinion must not be unreasonable, but it does not have to be universally accepted in order to be widely accepted and the fact that there

are differing peer professional opinions does not prevent one or more of them being relied on by a defendant. Given the highly qualified expert witnesses called on both sides in this case, one cannot help but think that the result might have been different under the law as it now stands. It was changed to protect competent professionals acting in accordance with a widely accepted practice.

[page 101] Note, though, that we are not suggesting that these provisions will necessarily thwart all plaintiffs’ claims. Success or otherwise will ultimately depend on the strength of the evidence presented to the court, the jurisdiction in which the claim is instituted and the court’s interpretation of that jurisdiction’s relevant provisions (such as when peer opinion might be considered ‘irrational’ (or ‘unreasonable’, in Victoria)). Indeed, several claims have succeeded despite the constraining provisions. That said, one can speculate that these provisions have had a chilling effect, as disincentives to potential plaintiffs instituting civil actions. It is also worth noting that regardless of whether the claim is governed by the Civil Liability Acts or had been governed by common law principles, it is often extremely taxing for the plaintiff to establish carelessness with respect to diagnosis and treatment. Providing a service — examples 3.25 Several cases have considered a range of issues related to the service provision sections, including the valuing of the expert opinion, applying the ‘modified Bolam’ test under the Act and the coexistence of differing medical opinions (which, on the words of the section, do not necessarily thwart the use of peer professional opinion as a ‘good defence’). They include Hawes v Holley [2008] NSWDC 147; Hope v Hunter and New England Area Health Service (2009) 10 DCLR (NSW) 63; [2009] NSWDC 307; Melchior v Sydney Adventist Hospital Ltd [2008] NSWSC 1282. By way of example, the way in which aspects of the

New South Wales provisions operate was explored in the following oftcited case. Case Example Dobler v Halverson (2007) 70 NSWLR 151 Facts: An 18-year-old had suffered ‘syncopal events’ — briefly losing consciousness — over a period of several years. He consulted the defendant doctor on each occasion. During this period he suffered migraines. On one occasion, when he was suffering from an acute migraine, he saw the doctor, who detected that he had a heart murmur. The doctor did not test his patient with an electrocardiogram (ECG) and did not refer him to a cardiologist. As a result of cardiac arrest, the 18-year-old suffered severe injuries, including irreversible brain damage. Issue: What is the effect of the peer professional opinion provision on the court’s assessment of the doctor’s conduct? Decision: The New South Wales Court of Appeal affirmed the trial judge’s finding that the doctor had fallen below the standard of care required of him. Further, he was not protected by the peer professional opinion section of the New South Wales Civil Liability Act 2002. In these circumstances, failing to obtain an ECG was not acting in a manner widely accepted by peer professional opinion as competent professional practice. The court considered the way in which this part of the Act operated more generally. Giles JA stated (at [59]–[61]) (Ipp and Basten JJA agreeing): [page 102] Commonly, as in the present case, there will be expert evidence called by the plaintiff to the effect that the defendant’s conduct fell short of acceptable professional practice and expert evidence called by the defendant that it did not … Apart from s 5O, the Court would determine the standard of care, guided by the evidence of acceptable professional practice. It would not be obliged to hold against the plaintiff if the defendant’s conduct accorded with professional practice regarded as acceptable by some although not by others. Section 5O has the effect that, if the defendant’s conduct accorded with professional practice regarded as acceptable by some (more fully, if he ‘acted in a manner that … was widely accepted … by peer professional opinion as competent professional practice’), then subject to rationality that professional practice sets the standard of care. In this sense, s 5O provides a defence. The plaintiff will usually call his expert evidence to the effect that the defendant’s conduct fell short of acceptable professional practice, and will invite the Court to determine the standard of care in accordance with that evidence. He will not be concerned to identify and negate a different professional practice favourable to the defendant, and s 5O does not

require that he do so. The defendant has the interest in calling expert evidence to establish that he acted according to professional practice widely accepted by peer professional opinion, which if accepted will (subject to rationality) mean that he escapes liability. … Section 5O may end up operating so as to determine the defendant’s standard of care, but the standard of care will be that determined by the Court with guidance from evidence of acceptable professional practice unless it is established (in practice, by the defendant) that the defendant acted according to professional practice widely accepted by (rational) peer professional opinion. The court also held that the plaintiff had established causation, noting that proof must be established on a balance of probabilities; even though the evidence falls short of scientific certainty it can satisfy legal responsibility (see 4.17).

The New South Wales Court of Appeal applied Dobler in Sydney South West Area Health Services v MD (2009) 260 ALR 702. Hodgson JA stated (at [21], [23]): [I]t is clear that s 5O modifies the common law and provides a defence not available at common law, with an onus of proof lying on a defendant. [T]he material facts contemplated by s 5O should be pleaded in a defence, even if the specific reference to s 5O is not mandatory. However, I would say that specific reference to s 5O would be desirable.

In Brakoulias v Karunaharan [2012] VSC 272, Macaulay J stated that the Victorian peer professional opinion provision constituted a defence. This case involved a 50-year-old woman who suffered cardiac arrest and consequent serious long-term injuries after taking weight loss medication prescribed by the defendant. Macaulay J’s view was endorsed by Forrest J in Grinham v Tabro Meats Pty Ltd; Victorian WorkCover Authority v Murray [2012] VSC 49. Queensland’s Civil Liability Act 2003 (Qld) was considered in the following case. [page 103] Case Example Mules v Ferguson [2015] QCA 005

Facts: The appellant consulted her general practitioner, the respondent, several times in September 2008 complaining of neck pain and headaches. Following the final consultation, the appellant was admitted to hospital where she was diagnosed with cryptococcal meningitis, a disease which left her blind, deaf and with other grievous disabilities. The appellant alleged that the respondent was negligent because she did not undertake a proper examination or make adequate inquiries into the appellant’s symptoms. Issue: Did the respondent fulfil the standard of care expected of a medical professional? Could the doctor rely on peer professional opinion as a defence? Decision: Reversing the decision of the trial judge, the Queensland Court of Appeal (McMurdo P and Boddice J agreeing; Appelgarth J dissenting) held that the respondent was liable. The doctor had breached her duty of care by failing to physically examine the appellant, make proper inquiries about her headaches or refer her to a specialist. The respondent did not demonstrate that her conduct was supported by peer professional opinion (at [196]–[197]); a reasonably prudent general practitioner would have made further inquiries. With respect to peer professional opinion, Boddice J stated (at [191]): Section 22 of the Act provides a defence to a breach of duty if the medical practitioner establishes he or she acted in a way which was widely accepted by peer professional opinion by a significant number of professionals in that field. That defence requires an identification of the particular conduct, and the group of peer opinion supporting that conduct as being widely accepted practice. The onus rests on the respondent to satisfy that defence.

The effect of the provision in the Civil Liability Act 2002 (NSW) did not prevent the plaintiff from succeeding in Freestone v Murrumbidgee Local Health District [2016] NSWDC 53. This case involved a radiologist who performed a CT scan on the plaintiff that demonstrated inflammation in the abdominal area and a lesion on the left kidney. However, the radiology report made no reference to the lesion. Several years later the plaintiff underwent a biopsy which revealed that the legion was a ‘Wilm’s tumour’, requiring surgery, chemotherapy and radiotherapy. Delaney and Sidis ADCJJ held (at [68]–[69]) that the failure to identify and report the lesion when the CT scan was initially performed was a significant oversight by the radiologist — a breach. While their Honours indicated (at [64]) that peer professional opinion operates as a defence, they concluded (at [73]–[74]) that the defendant could not successfully rely on it because the failure to report the lesion was not widely accepted as competent professional practice. The court also noted Dobler (at [72]) which considered, without deciding the

point, whether it was open to the court to prefer one expert’s competing medical opinion over another, even if it is not ‘irrational’. [page 104] The plaintiff in Rothonis v Lattimore [2016] NSWSC 1409 consulted a cardiologist after experiencing disturbed vision and consciousness. Nine months later, she suffered a stroke which left her seriously disabled. She alleged that the defendant negligently failed to investigate, diagnose or prescribe treatment for someone with her symptoms. The defendant did not dispute that it was reasonably foreseeable that the plaintiff might suffer a stroke. With respect to the negligence calculus, the court held (at [86]) that the probability that a stroke might occur if reasonable care were not taken was not clear due to the ‘want of scientific evidence’; however, the seriousness of harm from a stroke was clearly very significant. Fagan J stated (at [88]) that the decisive consideration was whether a reasonable person would have taken precautions against the risk of stroke, holding (at [94], [109], [118], [124]) that on the evidence in these circumstances the duty of care had not been breached. Furthermore, his Honour suggested (at [92]) that peer professional opinion operated as a defence to liability, which only required consideration if there was a prima facie breach (which he had held was not the case here). In Wei Fan v South Eastern Sydney Local Health District (No 2) [2015] NSWSC 1235, the plaintiff attended Sutherland Hospital, Prince of Wales Hospital and St George Hospital between 20 January 2007 and 16 March 2007. The plaintiff alleged that the hospitals were negligent because they failed to diagnose and treat his gall bladder condition (cholecystitis) and type 2 diabetes; he also alleged negligence for allowing him to fall from his hospital bed and discharging him when he was not fit to be discharged. Harrison AsJ held (at [246], [250]) that the test results were not necessarily indicative of diabetes. Therefore, doctors acted in accordance with competent medical professional practice. Similarly, the court held (at [254]–[256]) that the decisions

that had been made were appropriate and reasonable and in accordance with competent medical professional practice. Therefore, the failure to diagnose and treat cholecystitis was not unreasonable. Further, Harrison AsJ held (at [259]) that no breach was found with respect to the fall from the hospital bed or discharge. The plaintiff in Redzepovic v Western Health [2016] VSCA 251 noticed swelling on the left-hand side of his face and neck extending along the jaw line to the left ear. After being examined, he was advised that he should undergo a left parotidectomy. He signed a consent form which mentioned the risks and complications of surgery. However, following the surgery, he experienced significant pain and other adverse effects. He alleged (at [11]) that the defendant was negligent in conducting the surgery when there was no need to do so and in failing to give proper advice with respect to the risks associated with it (additional examples of cases concerning warnings are considered, below). Ferguson and Kaye JJA and Beale AJA of the Supreme Court of Victoria, Court of Appeal held (at [85]) that surgery to remove the lump was a reasonable and appropriate course of action, based on the overwhelming weight of medical opinion. While their Honours emphasised that it is for the court, rather than medical experts, to determine allegations of carelessness, their Honours also stated (at [96]): ‘However, in the area of diagnosis and treatment, the Court [page 105] does place weight on the evidence of medical practitioners, who have experience in the field of expertise that is practised by the defendant.’ Warnings, advice or other information — examples 3.26 Biggs v George [2016] NSWCA 113 explored circumstances in which the plaintiff, who had a limited grasp of English (her first language was Macedonian), was diagnosed with a tumour on the sheath of an acoustic nerve. She had been suffering from a hearing

impairment (with nausea, balance issues and ringing). She agreed to undergo what was acknowledged as risky surgery to remove the tumour. During the operation an adjoining facial nerve was severed, resulting in a facial palsy and further unsuccessful treatment. Prior to the surgery, the plaintiff had attended four pre-operative consultations. She had been accompanied by a friend who translated for her at the first two consultations; an official interpreter was present at the third and fourth consultations. The plaintiff alleged that the surgeon and hospital failed to warn of the risk of damage to the facial nerve. Basten JA (Ward and Payne JJA agreeing) of the New South Wales Court of Appeal held (at [50], [63], [105]) that reasonable care had been taken to ensure that the material risks attending the surgical procedure were conveyed to the plaintiff and that the substance of the information conveyed had been understood by her. Morocz v Marshman [2016] NSWCA 202 is of interest as it highlights the court’s view that with elective procedures there are limits to the duty to warn because of the importance of patient autonomy. This was highlighted by the lower court and endorsed by the New South Wales Court of Appeal (at [166]–[167]). In this case, the appellant consulted the respondent about a condition she suffered from, known as hyperhidrosis (sweaty palms). At this consultation, the appellant was given a brochure about a procedure — bilateral endoscopic thoracic sympathectomy. The respondent also discussed potential risks and complications with the appellant. Following the surgery, the appellant was in considerable pain and complained of various health problems and side effects including compensatory sweating, heart palpitations and debilitating headaches. She alleged that the respondent had negligently failed to warn her of the material risks associated with the procedure. Payne JA (McFarlan JA and Emmett AJA agreeing) first outlined the relevant principles. The court then affirmed the lower court’s finding that in these circumstances the material risks included the return of her hyperhidrosis, disabling compensatory sweating and intercostal neuralgia. However, the respondent had provided the appellant with adequate warning of the material risks. Relying extensively on expert evidence, the court held (at [123], [136], [143],

[149]) that the brochure was comprehensive in explaining those risks, that the appellant read and understood the brochure and, in any event, the respondent had specifically warned the appellant of those risks in their pre-operative discussions. Further, the court stated (at [160], [164], [176]) that risks such as an abnormal heart rhythm, anxiety, headaches and disruption of the autonomic nervous system were not material risks associated with the surgery; there was no duty to warn of these risks. [page 106] Finally, the court rejected the notion that the appellant should have been advised to undertake alternative procedures and not to undergo the sympathectomy. Payne JA emphasised (at [168]) the importance of patient autonomy in this context: [The appellant] conducted extensive investigations prior to consulting the respondent and was enthusiastic about undergoing the procedure. She gave evidence that she believed at the time, based on her own independent investigations, that alternative treatments were inferior to surgery. The appellant was obviously an intelligent and well educated person who had herself conducted considerable research and sought out the respondent to perform a sympathectomy.

Uniformity? 3.27 Finally, it is clear that the attempt to enact uniform provisions throughout Australia did not bear fruit. Although there are similarities in many of the statutes, important differences exist. As is the case throughout this book, close attention must be paid to the exact wording of the relevant Act in a particular state or territory in order to accurately assess the law governing the particular circumstances, leading to the provision of correct advice.

Nature of the Risk of Harm Reasonable foreseeability: foresight not hindsight

3.28 As we saw, the standard of reasonable care depends, in part, on the knowledge, skill and training that the defendant actually has, or ought to have. What the defendant knows, or ought to know, shapes the risks of injury that she or he can reasonably foresee. This is particularly difficult where knowledge is evolving or developing, as the next two cases illustrate. As Denning LJ emphasised in the following case, when making an assessment of what the defendant knows or ought to know, one must guard against judging the circumstances with hindsight, rather than foresight. Case Example Roe v Minister of Health [1954] 2 QB 66 Facts: Two individuals went into hospital for minor operations. They were given a spinal anaesthetic called ‘nupercaine’. The nupercaine was contained in sealed glass ampoules, which were stored in a solution of phenol, for sterilisation purposes. After the operation, the patients were found to have spastic paraplegia, which was thought to be caused by the presence of phenol in the anaesthetic injected into each man’s spine. The phenol had contaminated the nupercaine through invisible cracks in the glass ampoules. The patients, paralysed from the waist down, sued the anaesthetist. Issue: Was the anaesthetist negligent? [page 107] Decision: Both the trial judge and the Court of Appeal held that the anaesthetist had not been negligent according to the standard of medical knowledge in 1947, the time of the accident. At that date, no-one knew of the possibility of contamination of nupercaine by phenol in this way. Denning LJ said (at 83–4): [The anaesthetist] sought to escape the danger of infection by disinfecting the ampoule. In escaping that known danger he unfortunately ran into another danger. He did not know that there could be undetectable cracks, but it was not negligent for him not to know it at that time. We must not look at the 1947 accident with 1954 spectacles.

Case Example

H v Royal Alexandra Hospital for Children (1990) Aust Torts Reports ¶81-000 Facts: The plaintiff had been diagnosed as a haemophiliac in 1980, when he was aged six. He was given blood transfusions at the defendant hospital in March 1982 and September 1983, in a process known as ‘factor VIII therapy’. One of these transfusions infected him with the human immuno-deficiency virus (HIV). After being infected with HIV, he contracted AIDS. He sued the hospital (among others). AIDS first appeared in 1982, in the United States. The HIV virus did not spread to Australia until late 1982 to early 1983. The first case of AIDS in Australia was diagnosed in April 1983. At first, it was not understood that HIV could be contracted from blood transfusions. In July 1983, a group of Australian researchers reported that they knew of no instances of AIDS in haemophiliacs. A test for detecting the HIV virus in blood was developed in the United States in late 1984, but it was not licensed for general use until May 1985. Issue: Was the hospital negligent by not adequately screening for HIV in the samples of blood it received from the blood bank? Decision: The Supreme Court of New South Wales held that the hospital had not been negligent with respect to the transfusion in March 1982, but it had been negligent with respect to the transfusion in September 1983. With respect to the March 1982 transfusion, Badgery-Parker J said (at 67,528): It is … quite impossible for the plaintiff to succeed on the basis that in and before March 1982 [the defendant] ought to have foreseen and guarded against the risk that the plaintiff might, through Factor VIII therapy, become infected with, specifically, the agent causing the outbreak of immune deficiency illnesses in homosexuals. The most that the evidence establishes is that there was in March 1982 … a foreseeable risk that recipients of blood products would become infected with blood borne viruses as yet unknown and unidentified. In contrast, in respect of the September 1983 transfusion, Badgery-Parker J said (at 67,529): The first Australian case of AIDS was published in April 1983. I have in concluding that reasonably informed physicians, scientists transfusion services in this country ought to have been well aware April 1983 that there was a real risk that among the unknown and sources of infection which

no difficulty and blood by at latest unidentified

[page 108] blood and blood products had the capacity to carry must be numbered whatever agent was responsible for the production of AIDS. Although the court held that the hospital was negligent in respect of the later transfusion, the plaintiff’s action failed, as he could not prove that it was the September

1983 transfusion, rather than the March 1982 transfusion, that had caused him to contract HIV.

In H v Royal Alexandra Hospital for Children, the activity of giving blood transfusions to haemophiliacs did not pose a reasonably foreseeable risk of infection with HIV in March 1982. However, it did pose such a risk in September 1983, not because anything in the process of transfusion had changed, but because the knowledge that could reasonably be expected of the defendant had changed by that date. Courts repeatedly emphasise the need to use foresight and to guard against the use of an after-the-fact analysis. By way of example, the High Court of Australia expressed these concerns, cautioning against the error of using hindsight, in Vairy v Wyong Shire Council (2005) 223 CLR 422; 221 ALR 711; Mulligan v Coffs Harbour City Council (2005) 223 CLR 486; 221 ALR 764 (see 3.63); New South Wales v Fahy (2007) 232 CLR 486; 236 ALR 406 (see 3.39); and Adeels Palace Pty Ltd v Moubarak (2009) 239 CLR 420; 260 ALR 628 (see 3.40).

At common law: the ‘not far-fetched or fanciful’ test 3.29 It is worth highlighting the fact that every activity carries with it some degree of risk. Even the simplest of activities may foreseeably give rise to injury. For example, if I (Ian or Martin) am mowing my lawn on a Sunday morning, I pose some foreseeable risk of injury to passers-by in the street; it is foreseeable, although not very likely, that the mower may strike a stone; and it is foreseeable, though even less likely, that the stone may be propelled through the air at just the moment that someone walks past my house and that it will hit the passer-by, rather than flying safely past her or him. The magnitude of the risk of injury depends on a combination of circumstances. For example, how many stones there are on my lawn; how often the blades of the mower propel a stone upwards rather than down into the turf; and how often people walk past my house on Sunday mornings. How great does the risk of injury have to be before

a reasonable person in my position would consider taking precautions against it, for example, by putting a guard over the blades of the mower? 3.30 The following extract is from the most-cited case in Australian negligence law. This case was important at common law because it outlined two matters: (i) the level of foresight required at the breach stage; (ii) the approach to use to assess the reasonable person’s response to a foreseeable risk of harm. [page 109] It is worth foreshadowing at this stage that the first aspect of the common law position as laid down in this case — the ‘not far-fetched or fanciful’ test — has been changed by statute in most jurisdictions: see 3.35. We are now considering the common law position so that a discussion of the statutory provision will be more meaningful. Of course, when considering a new scenario, your starting point involves an application of relevant statutory provisions. The other aspect of the case, which is still widely cited, remains useful as a description of the ‘calculus of negligence’. This remains important, as it is the approach reflected in most Civil Liability Acts: see the detailed discussion at 3.38. Key Case Wyong Shire Council v Shirt (1980) 146 CLR 40; 29 ALR 217 Facts: The defendant, a shire council, dredged a deep channel in a shallow lake, and put up signs by the channel, saying ‘Deep Water’. The signs were intended to signify that the water between them was deep. The plaintiff was an inexperienced water-skier, who fell from his skis while skiing in shallow water near the signs. He struck his head on the bottom of the lake, and suffered quadriplegic paralysis as a result. The plaintiff had been under the impression that the signs meant that the water all around them was deep. The water-skier sued the council. Issue: Was the council negligent by putting up misleading signs?

Decision: By a majority of four to one, the High Court of Australia held that the council had been negligent, even though the risk of someone misunderstanding the signs was very small. Mason J (with whom Stephen and Aickin JJ agreed) said (at CLR 47–8; ALR 221): A risk of injury which is quite unlikely to occur … may nevertheless be plainly foreseeable. Consequently, when we speak of a risk of injury as being ‘foreseeable’ we are not making any statement as to the probability or improbability of its occurrence, save that we are implicitly asserting that the risk is not one that is far-fetched or fanciful. Although it is true to say that in many cases the greater the degree of probability of the occurrence of the risk the more readily it will be perceived to be a risk, it certainly does not follow that a risk which is unlikely to occur is not foreseeable … [A] risk of injury which is remote in the sense that it is extremely unlikely to occur may nevertheless constitute a foreseeable risk. A risk which is not far-fetched or fanciful is real and therefore foreseeable.

Thus, at common law, if the risk of injury from a particular activity is ‘far-fetched or fanciful’, a reasonable person ignores it altogether, despite the fact that it is imaginable as a possible occurrence. If the risk is not ‘far-fetched or fanciful’, a reasonable person at least considers taking precautions against it. For example, if I have never seen a stone on my lawn and if my house is deep in the bush, far from the nearest neighbour, the risk of injury to others by my mowing my lawn is so [page 110] small that I may safely ignore it, as it is (probably) ‘far-fetched and fanciful’. If, by way of contrast, my lawn has a few stones, and the footpath past my house has a few passers-by, even on Sunday mornings, then it could be argued that the risk of injury to the passersby is not ‘far-fetched and fanciful’, and a reasonable person in my position would at least consider taking precautions against it. However, as we will soon explain, the ‘calculus of negligence’ would have to be considered before the court would find a breach. 3.31

The plaintiff does not have to show that the precise manner in

which her or his injury occurred was reasonably foreseeable, nor that the particular injury was reasonably foreseeable. For example, in Wyong Shire Council v Shirt, the plaintiff did not have to show that the reasonable shire council in the defendant’s position would have foreseen the precise chain of events by which he came to fall from his skis in the shallow water. He also did not have to show that it was foreseeable that he might suffer quadriplegia as a result of the ambiguity in the signs. All that the plaintiff had to prove was that the signs put up by the defendant created a reasonably foreseeable risk of injury of some kind to someone such as himself. 3.32 The reasonable foreseeability of injury depends on all the particular circumstances of the case. However, generally speaking, there is one risk that is reasonably foreseeable. That is the risk of negligence or inadvertence on the part of others. Case Example McLean v Tedman (1984) 155 CLR 306; 56 ALR 359 Facts: The plaintiff, a garbage collector, was injured when he was hit by a car while he was running across a road carrying a rubbish bin on his shoulder. The work practice he and his workmates had adopted was for the garbage truck to travel up one side of the road and for the garbage collectors to collect rubbish bins from both sides, running across the road to collect and return the bins. It would have been safer, but slower, for the truck to have driven up one side of the road, then down the other, as the garbage collectors would not then have been required to run across the road. Issue: Was the defendant employer (others were also sued) negligent in failing to provide its employees with a reasonably safe system of garbage collection? Decision: The defendant argued that the system of garbage collection had been adopted by the plaintiff and his workmates themselves and it was unsafe only because the plaintiff had not been paying attention to what he was doing and the car driver had been negligent, travelling too quickly. Assessing the circumstances, the High Court of Australia held that the defendant had negligently failed to provide a safe system of work. Mason, Wilson, Brennan and Dawson JJ said (at CLR 311; ALR 362–3): Although running across the road was a means of doing the work which the [plaintiff] and other employees chose or preferred, it was nevertheless a system of work of which [page 111]

… [the defendant] was aware or ought to have been aware. And it was fraught with some degree of risk of injury to employees in some circumstances, especially when an employee was crossing … when it was dark … The fact that the traffic was very light no doubt lessened the risk of injury, though it may have induced an employee to take less care for his own safety. However, there is simply no basis for saying that the risk of injury was fanciful … or for brushing it aside because it was insignificant. It was a foreseeable and significant risk inherent in the way in which the garbage was collected in Albany Creek Road arising from the possibility of negligence on the part of motorists and negligence or inadvertence on the part of an employee. In such a situation it is not an acceptable answer to assert that an employer has no control over an employee’s negligence or inadvertence. The standard of care expected of the reasonable man requires him to take account of the possibility of inadvertent and negligent conduct on the part of others.

Although McLean’s case is concerned with the relationship between employer and employee, the proposition that a reasonable person foresees the possibility of inadvertence or negligence on the part of others is of general application: see Bus v Sydney County Council (1989) 167 CLR 78 at 90; 85 ALR 577 at 585, per Mason CJ, Deane, Dawson and Toohey JJ. For example, the reasonable driver slows down when approaching an intersection, even if she or he has the right of way or is approaching a green traffic light, because she or he can reasonably foresee the possibility that others approaching the intersection may not observe the rules of the road, whether through negligence or inadvertence on their part: see, for example, Sibley v Kais (1967) 118 CLR 424; [1968] ALR 158. Similarly, in Anderson v Mount Isa Basketball Association Inc (1997) Aust Torts Reports ¶81-451, the Queensland Court of Appeal held that the defendant basketball association had negligently failed to give adequate instructions to the plaintiff, an inexperienced umpire, who was injured while running backwards during a game. The plaintiff’s inexperience created a foreseeable risk of injury, which the defendant association should have guarded against. 3.33 There are many examples of what is and is not a reasonably foreseeable risk of injury. The following cases are intended to make the concept a little clearer. They also illustrate how each case turns on

its own facts and the particular fact finder’s assessment. It is therefore important to highlight the fact that breach cases are usually mere applications of fundamental legal principles to the facts. As such, relatively few breach cases are of precedential value. Examples where they are indeed of precedential value are Wyong Shire Council v Shirt, where Mason J’s articulation of the general approach to be used when deciding breach is of great significance at common law (see 3.38), or a case like McHale v Watson, involving principles associated with children defendants and an attenuated standard of care (see 3.6). As we noted earlier, Shirt’s case, a binding authority, has been applied (explicitly or by implication) in a countless number of cases. [page 112] Case Example Schiller v Gregory (1985) Aust Torts Reports ¶80-751 Facts: The plaintiff slipped on a raised ledge around the sides of a swimming pool in the defendant’s backyard. He hit his head on the bottom of the pool, suffered serious spinal injuries and was rendered quadriplegic. There was evidence that the pool had been used without incident from 1960, when it was installed, to 1981, when the accident occurred. Issue: Was the risk of injury foreseeable? Decision: The Full Court of the Supreme Court of South Australia held that the risk of injury as a result of the design of the pool was so slight as to be ‘fanciful’ because, for 21 years, no-one had ever come to grief in the pool or even thought that there was any chance of coming to grief from a fall due to the slipperiness of the pool.

Case Example Nagle v Rottnest Island Authority (1993) 177 CLR 423; 112 ALR 393 Facts: The plaintiff hit his head on a submerged rock as he dived into a natural swimming pool known as ‘The Basin’, on Rottnest Island (near Perth). He suffered

quadriplegia. He sued the defendant, the statutory authority in charge of the island, alleging that his injuries had been caused by its negligence, as it failed to put up any signs warning that it was unsafe to dive into The Basin. Issue: Was it reasonably foreseeable that someone might suffer injury from diving into The Basin? Decision: Reversing the trial judgment, a majority of the Full Court of the Supreme Court of Western Australia held that that risk was not reasonably foreseeable, because no similar accident was known to have occurred previously at The Basin, and the submerged rocks were clearly visible, so the reasonable authority in the defendant’s position would not have expected swimmers to dive near them. A majority of the High Court of Australia (Mason CJ, Deane, Dawson and Gaudron JJ) disagreed (at CLR 430– 1; ALR 397–8): [W]e are left in no doubt that the trial judge was correct in concluding that the risk of injury to those diving from the rock ledge was reasonably foreseeable. As he said, ‘it may have reasonably been considered foolhardy or unlikely’ for a person to dive as [the plaintiff] did. But … that was not the relevant question; a risk may constitute a foreseeable risk even though it is unlikely to occur. It is enough that the risk is not far-fetched or fanciful … [There was a distinct possibility that a person might dive into the water at the Basin in circumstances where it was not safe to do so. Children and people with impaired sight might well do so. Moreover and more importantly, there was the possibility that persons intending to swim in the Basin might dive into the water without ascertaining whether it was safe to do so. It is now well established that a person who owes a duty of care to others must take account of the possibility that one or more of the persons to whom the duty is owed might fail to take proper care for his or her own safety … Whether small or not, the risk was certainly not far-fetched or fanciful.

[page 113] Case Example Inverell Municipal Council v Pennington (1993) Aust Torts Reports ¶81-234 Facts: The plaintiff dived into a public swimming pool owned and run by the defendants. He hit his head on the bottom and suffered quadriplegia. He was 1.85 m tall; he believed the depth of the water where he dived to be 1.52 m; it was in fact about 1.37 m deep. Issue: Were the diver’s injuries caused by the defendants’ negligence in failing to put up signs warning against the dangers of diving and/or a depth indicator showing the depth where he dived?

Decision: The New South Wales Court of Appeal held in favour of the diver. Clarke JA said (at 62,403–4): [The trial judge] was clearly correct in concluding that there was a foreseeable risk of injury … Indeed, his … reasoning follows the same pattern as … Nagle … While the law remains as expressed in Nagle, I think it is inevitable that the appeal should fail. What troubles me is that the decision effectively places the Council in the position of an insurer. From the practical point of view it is hard to imagine a happening which could not be described as ‘foreseeable’.

3.34 When Clarke JA made his comments in Pennington’s case, he had not overlooked Schiller. He was saying, in effect, that cases such as Schiller might be decided differently in the light of Nagle. As you will see, for several years, there has been a general trend at common law and under the civil liability statutes away from plaintiffs like Nagle and Pennington succeeding. The pendulum has clearly shifted to favour defendants in these types of cases. However, regardless of ‘trends’, it is important to recall that every case must be decided on its own facts. In Lennon v Gympie Motel [2016] QSC 315, a 12-year-old was rendered tetraplegic after diving into a pool located at the Gympie Motel. She struck her head on the pool bottom. There was a sign outside the pool that read, ‘all children must be under adult supervision at all times’. The depth of the pool gradually increased from 0.9 m at one end to 1.74 m at the opposite end, but there were no depth markers or signs prohibiting diving around the pool. Because the plaintiff’s injuries occurred in 1998, the Civil Liability Act 2003 (Qld) did not apply. Flanagan J considered this case in the context of Inverell, Mulligan and Woods, holding that the defendant had breached its duty of care by not installing depth markers and/or a ‘no diving sign’. Factors he considered included the following (at [172]): the defendant encouraged guests to use the pool; children were regular guests and the defendant knew that they regularly used the pool; dangers of diving into a swimming pool not designed for diving is a well-known risk; and the likely consequences of the risk occurring were catastrophic. A sign prohibiting diving and depth markers would have operated as a direct and immediate warning, the precautions

which could have been taken and which were later taken were simple and involved no great cost, most pool users would not be familiar with its depth; also, the fact that the pool was shallower than four feet for half its length should have led to a prohibition on diving. His [page 114] Honour also concluded (at [176]) that this was not an ‘obvious risk’ and addressed contributory negligence: see 10.13 (on the latter issue).

Under the statutes: the ‘not insignificant’ test 3.35 As was noted briefly in 3.30, statutory changes have affected the first part of Mason J’s judgment in Wyong Shire Council v Shirt. The Ipp Panel was concerned that the ‘not far-fetched or fanciful’ common law test outlined in Shirt’s case was too easily satisfied (for example, its application in cases like Pennington). It suggested changes, intended to circumscribe potential liability and limit litigation. One such recommendation was the introduction of the ‘not insignificant’ test. New South Wales was the first jurisdiction to enact legislative changes, mirroring the Ipp Panel’s suggestions. Each of the other jurisdictions, except the Northern Territory, has followed suit,18 with provisions that are very similar but not identical. The statutory provisions (in general but not identical terms) prescribe: (1) A person is not negligent in failing to take precautions against a risk of harm unless: (a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and (b) the risk was not insignificant, and (c) in the circumstances, a reasonable person in the person’s position would have taken those precautions.

In an unfortunate attempt to assist those applying the Act, Victoria’s Wrongs Act 1958 (Vic) s 48(3) valiantly attempts to define ‘not insignificant’ (no doubt to the dismay of ‘plain English’ advocates):

For the purposes of sub-section (1)(b) — (a) insignificant risks include, but are not limited to, risks that are far-fetched or fanciful; and (b) risks that are not insignificant are all risks other than insignificant risks and include, but are not limited to, significant risks.

One difference between the relevant sections in the New South Wales and Western Australian Acts was considered in Department of Housing and Works v Smith (No 2) (2010) 265 ALR 490. Ultimately, this difference did not affect the reasoning in that case. 3.36 As is the case with most statutory formulations, this new test required judicial interpretation. A few examples of how this test has been interpreted and applied follow. [page 115] Case Example Drinkwater v Howarth [2006] NSWCA 222 Facts: The plaintiff’s friend was arguing with two security guards, yelling and kicking as he was led out of a hotel bar. The plaintiff followed his friend and the guards out of the bar. The plaintiff came up to his friend from behind, trying to get him onto a courtesy bus. A guard shoved his friend, who fell backwards against the plaintiff, as a result of which the plaintiff fell onto the ground (with his friend on top). The plaintiff broke his ankle. Issue: What is the effect of s 5B of the Civil Liability Act 2002 (NSW) and the ‘not insignificant’ provision? Decision: For the sake of argument, the case proceeded on the basis that s 5B applied to a deliberate act of pushing, which is done without due care (negligently). Basten, Hodgson and Tobias JJA of the New South Wales Court of Appeal noted that a risk which is much more than ‘far-fetched or fanciful’ may not differ materially from one that is ‘not insignificant’. Hodgson JA concluded (at [25]): Assuming that s 5B applies, in this case there is no possibility of a different result of applying a test that the risk in question be not insignificant, from applying the test as formulated in Shirt, namely that the risk be not far-fetched or fanciful. Basten JA stated (at [21]–[22]):

[T]here is a danger in seeking to take each limb of s 5B separately in considering how it should operate. It is clear from the report of the committee which recommended the change to the foregoing common law principles that in changing the terminology from not far-fetched or fanciful they were concerned to ensure that attention was given to other aspects of the risk. They expressly adopted a passage from … McHugh J in Tame v New South Wales (2002) 211 CLR 317 at [99] where his Honour noted that Mason J in Shirt had emphasised aspects of the nature of the calculation which needed to be undertaken, being matters which are now set out in subs (2) of s 5B. McHugh J … noted the danger of treating the various elements as divisible and the importance of treating the concept of the reasonable person’s response to a risk as part of a single overall test of reasonableness in the concept of the tort.

Case Example Shaw v Thomas [2010] NSWCA 169 Facts: A 10-year-old stayed overnight at a friend’s home. Unable to sleep, he climbed to his friend’s upper level bunk bed to chat. As he came down, he fell, sustaining serious head injuries. His friend’s parents had not installed a ladder and guard-rail. Issue: Was this risk ‘not insignificant’? Decision: The New South Wales Court of Appeal stated that as occupiers and owners of domestic premises, they were not expected as ‘reasonable persons’ to [page 116] be aware of Australian Standards when assessing whether or not the risk was ‘not insignificant’. With respect to this threshold requirement, Macfarlan JA (Beazley and Tobias JJA agreeing) stated (at [44]–[45]): In Wyong Shire Council v Shirt, Mason J referred to a risk ‘which is not farfetched or fanciful’ as ‘being real and therefore foreseeable’ … The requirement in s 5B(1)(b) [of the New South Wales Act] that the risk be ‘not insignificant’ imposes a more demanding standard but in my view not by very much. If … the risk is defined as one of Cameron falling and injuring himself whilst descending from the top bunk of the bed in question, that risk must … be regarded as one that was ‘not insignificant’. There is always some risk of injury when children climb up to and down from elevated surfaces. Even though Cameron was 10 … I do not consider that the risk of him suffering a mishap in doing so was ‘insignificant’. Whether the risk of him doing so was sufficiently

significant to require precautions to be taken against it occurring is an entirely different question … After considering this ‘entirely different question’, the court ultimately held that the parents had acted reasonably (see 3.41).

The Supreme Court of the Australian Capital Territory Court of Appeal affirmed existing principles with respect to the meaning of a ‘not insignificant’ risk in Electro Optic Systems Pty Ltd v New South Wales (2014) 180 ACTR 1; [2014] ACTCA 45. In January 2003, bush fires in the Brindabella Ranges burned out of control in New South Wales and the Australian Capital Territory. It was ignited by a lightning strike in the Brindabella National Park, which was east of the Goodradigbee River. Four people were killed, hundreds injured and many properties were destroyed or damaged. Various property owners commenced proceedings against the state of New South Wales, unsuccessfully arguing that the state breached its duty to take reasonable care in conceiving and implementing a plan to control the bushfire. With respect to the ‘not insignificant risk’ test, Jagot J observed (at [226]): In Shaw v Thomas [2010] NSWCA 169 (Shaw) MacFarlan JA (with whom the other judges agreed) said at [44] that the expression ‘not insignificant’ ‘imposes a more demanding standard [than that of the common law] but not by much’. In Cox v Fellows [2013] NSWCA 206 at [145] Gleeson JA (with whom the other judges agreed) referred with approval to this passage in Shaw. In Garzo v Liverpool/Campbelltown Christian School [2012] NSWCA 151, Tobias AJA referred to the passage from the Ipp Report quoted above, and noted at [150] that s 5B was intended to cover a risk that was more than far-fetched or fanciful, but less than significant or substantial. Nevertheless, at [150] and [151] his Honour did conclude on the facts of the case that, the relevant risk of harm being foreseeable, it was ‘but a short step’ to find that the risk was ‘not insignificant’, noting that the particular risk in that case ‘may be low, but it is not far-fetched or fanciful’.

Consideration of the ‘not insignificant’ requirement also arose in Erickson v Bagley [2015] VSCA 220. The applicant (seeking leave to appeal the trial judgment) was staying in a loft above a garage on premises owned and occupied by the respondents. One evening, he slipped and fell on the driveway, sustaining [page 117]

a shoulder injury. He argued that the occupiers failed to provide adequate lighting in the area where he fell. Kyrou and Kaye JJA of the Supreme Court of Victoria, Court of Appeal considered occupiers’ liability under the Wrongs Act 1958 (Vic) s 14B(3), as qualified by s 48 and influenced by the Ipp Panel’s recommendations. With respect to the ‘not insignificant’ criterion, their Honours observed (at [36]): By selecting the phrase ‘not insignificant’ [in s 48(1)(b) of the Wrongs Act 1958 (Vic)], the legislature has postulated a test that is more demanding, for a plaintiff, than the common law test, although ‘… not by very much’. In that way, the statute has sought to ensure that liability is not imposed on a defendant too readily.

The court also referred (at [37]–[38]) to High Court observations that ‘few people live in premises that are completely free of hazards’ and that reasonable behaviour does not require ‘householders to eliminate all risks from their premises’ (see 3.66). Here, there had been no previous incidents and no complaints regarding the state of the lighting. According to the court (at [41]), ‘the probability of that risk materialising was so low that a reasonable occupier would not be required to take any further steps than those taken’ (see 3.37). The court held (at [50]), ‘insofar as any risk of harm was comprised in the lack of lighting on the driveway, the applicant failed to establish that the risk was not insignificant’. The Queensland Court of Appeal considered the meaning of the ‘not insignificant’ test in Meandarra Aerial Spraying Pty Ltd v GEJ & MA Geldard Pty Ltd [2013] 1 Qd R 319; [2012] QCA 315, where aerial spraying of a herbicide used to control wattle tree growth on cattle properties was alleged to have caused damage to the plaintiff’s cotton crops, 20 km away. Upholding the trial judge’s liability finding, Fraser JA (Wilson JA and Mullins J agreeing) made some interesting observations about the Civil Liability Act 2003 (Qld) (at [26]): The respondent referred to Chesterman J’s statement in Pollard v Trude [[2008] QSC 119 at [39]] that the replacement in s 9(1)(b) of ‘not insignificant’ for the common law formulation of ‘not far-fetched or fanciful’ added little in clarity. Nevertheless, the provision was designed to increase the degree of probability of harm which is required for a finding that a risk was foreseeable. I think that it did produce some slight increase in the necessary degree of probability. A far-fetched or fanciful risk is necessarily so glaringly improbable as to be insignificant, but the obverse proposition may not necessarily be true. The generality of these descriptions makes it difficult to

be dogmatic about this, but the statutory language does seem to convey a different shade of meaning. The difference is a subtle one. The increase in the necessary degree of probability is not quantifiable and it might be so minor as to make no difference to the result in most cases. Nevertheless, in deciding claims to which the Act applies the ‘not insignificant’ test must be applied instead of the somewhat less demanding test of ‘not far-fetched or fanciful’.

Pollard v Trude [2009] 2 Qd R 248, referred to in Meandarra Aerial Spraying Ltd, involved a golfer who was hit in the eye by a golf ball driven by another golfer, who accompanied his shot with what may or may not be considered a ‘warning’. After noting that the ‘not insignificant’ test replaced the Shirt test, the trial judge had stated in Pollard v Trude [2008] QSC 119 (at [39]), ‘[t]he new formulation adds little in clarity’. The Court of Appeal (at [17]) affirmed the conclusion that although [page 118] the risk was not a great one, it was real and above the ‘not insignificant’ threshold. However, it held that there was no breach, as the defendant had done all that could reasonably be expected of him with respect to warning of the poorly hit ball. The court also considered the voluntary assumption of risk defence and whether or not this was an ‘obvious risk’ under the Civil Liability Act 2003 (Qld) s 15 (see 11.27). The plaintiff in Bitupave Ltd (t/as Boral Asphalt) v Pillinger (2015) 72 MVR 460; [2015] NSWCA 298 was seriously injured when he lost control of his motorcycle as a result of the tyres coming into contact with material on the road, such as dirt, twigs, leaves and gravel that had been left on the side of a rural road by the council and contractor at the conclusion of resurfacing roadworks. Ward, Emmett and Gleeson JJA, of the New South Wales Court of Appeal, held (at [193]): While the question whether a risk of harm is ‘not insignificant’ … requires an assessment of the probability of the harm occurrence of the risk, it is not necessary that the precise manner in which the risk might come to pass be reasonably foreseeable.

It was held (at [195], [197]) that the risk of harm, though not particularly large, was not insignificant. The court also considered factual causation (necessary condition) issues: see 4.17. In Mungis (No 2) Pty Ltd v Still [2011] NSWCA 261, citing Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd (2009) 168 LGERA 357; [2009] NSWCA 263, Sackville AJA noted (at [51]): The duty of care arises under the general law. However, a court cannot make a finding of breach of duty for failing to take precautions against a risk of harm unless the three pre-conditions set out in s 5B(1) of the [Civil Liability Act 2002 (NSW)] are satisfied.

This case is considered in detail at 3.57. As was the case with the test from Shirt’s case, applying the ‘not insignificant’ test to a particular set of circumstances depends on how the fact finder assesses the risk. This will no doubt differ as between different fact finders, regardless of the ‘test’ she or he employs.

The Reasonable Person’s Response: The ‘Calculus of Negligence’ Ignore the risk? 3.37 If a risk of injury is foreseeable and ‘not insignificant’ (under statute in most jurisdictions), a reasonable person at least takes it into account. However, a reasonable person does not always take precautions against these risks. The principle stated by Mason J in Wyong Shire Council v Shirt (see 3.38) conceives of the possibility that a reasonable person in the defendant’s position might foresee a risk of injury, yet decide to do nothing about it in the circumstances. This is also reflected in the civil liability statutes. [page 119]

Therefore, it may not be sufficient for the plaintiff to persuade the court that the risk of injury was ‘not insignificant’ under the Civil Liability Acts and that reasonably practicable precautions against that risk were readily available to the defendant. In Phillis v Daly (1988) 15 NSWLR 65 at 74, Mahoney JA provides a basic example to outline how a reasonable person might not regard the risk as significant enough to take precautions to guard against it, even though appropriate precautions might be readily available. His example follows: the mere presence of a chair or a table in a room poses a foreseeable risk of injury to a person entering that room, because that person might slip, fall and injure herself or himself on the chair or table. There exists a reasonably practicable precaution to guard against that risk: remove the chair or table from the room. Nevertheless, a reasonable person would not take that simple precaution, despite the fact that it would remove the reasonably foreseeable risk. In Dailly v Spot-On Investments Pty Ltd (t/as Spot-On Photos) (1995) Aust Torts Reports ¶81-363, the plaintiff was injured when she tripped over a rack containing picture frames in the defendant’s shop. The rack was below eye level, beneath the service counter. The plaintiff argued that the shop was too cluttered and that the rack should have been moved to a safer position. The New South Wales Court of Appeal held unanimously (after referring to Mahoney JA’s comments in Phillis v Daly) that the defendant had not been negligent, even though it had failed to supply a simple, cheap (perhaps even cost-free) precaution against a small but reasonably foreseeable risk by moving the rack. Additional examples can be found elsewhere in this chapter: see, for example, the discussion of ‘obvious risk’ (3.63) and occupiers’ liability (3.65), as this issue arises relatively often in those contexts.

‘Calculus of negligence’ and Wyong Shire Council v Shirt: a balancing act 3.38 A reasonable person takes reasonable precautions against reasonably foreseeable risks (that are ‘not insignificant’). To determine the standard of care and whether or not the defendant discharged her

or his duty to take care, the probability of the risk materialising and its gravity if it were to occur are balanced against the practicability of precautions necessary to reasonably guard against the foreseeable risk and the social utility of the defendant’s conduct. Weighing these factors in this way is often referred to as the ‘calculus of negligence’ (a phrase associated with Judge Learned Hand’s judgment in the American case, United States v Carroll Towing Co, 159 F 2d 169 (2nd Cir, 1947), although Hand J did not actually use that expression). This balancing act underlies the approach outlined by Mason J in Wyong Shire Council v Shirt (at CLR 47–8; ALR 221). Mason J (with whom Stephen and Aickin JJ agreed) said: In deciding whether there has been a breach of the duty of care the tribunal of fact must first ask itself whether a reasonable man in the defendant’s position would have foreseen that his conduct involved a risk of injury to the plaintiff or to a class of persons including the plaintiff. If the answer be in the affirmative, it is then for the tribunal of fact to determine what a reasonable man would do by way of response to

[page 120] the risk. The perception of the reasonable man’s response calls for a consideration of the magnitude of the risk and the degree of probability of its occurrence, along with the expense, difficulty and inconvenience of taking alleviating action and any other conflicting responsibilities which the defendant may have. It is only when these matters are balanced out that the tribunal of fact can confidently assert what is the standard of response to be ascribed to the reasonable man placed in the defendant’s position.

As we noted previously, while Mason J’s reasoning is not always explicitly articulated, it nevertheless features as the underlying reasoning in every case of negligence. Further, even though some decisions seem to highlight one aspect of this balancing act more than other aspects, all factors interact (at least implicitly) and must be considered, so that the fact finder can reach an appropriate outcome in its assessment of the standard of care and whether or not the duty has been breached.

Criticism of the ‘Shirt approach’: should it be

reconsidered? 3.39 The appropriateness of the approach articulated in Wyong Shire Council v Shirt was considered by the ‘Gleeson court’ in the following case, which arose in the employment context. Ultimately, despite the concerns voiced by Callinan and Heydon JJ, a majority of the High Court judges deciding this case endorsed the Shirt approach. Key Case New South Wales v Fahy (2007) 232 CLR 486; 236 ALR 406 Facts: Fahy, a constable in the police service and Evans, a senior constable, were called upon to investigate a shopping centre hold-up. They attended the medical centre, where a doctor was treating the victim, who had been stabbed in the chest. Having asked the doctor how she could help, Fahy was told to examine the victim’s left side. Gummow and Hayne JJ described the scene (at [31]–[33]): Ms Fahy discovered that the victim had suffered another, very deep, laceration which extended from his armpit to his waist. He was bleeding profusely. She tried to stop the bleeding by first applying dressings and then holding the wound together. Mr Evans may or may not have told Ms Fahy that he was going outside. Be that as it may, he did not stay with Ms Fahy. The victim, still conscious, but bleeding profusely and evidently fearing death, spoke of his wife, his children, and his love for them. Ms Fahy tried to comfort him while, at the same time, using her radio, she asked, several times, where was the ambulance that had been summoned. … Throughout it all she attempted to keep the victim’s wound closed. Other police officers arrived at the scene but none came into the treatment room at the medical centre. … Ms Fahy helped [the ambulance officers] move the victim into the ambulance. As the ambulance was leaving, the duty officer … told Ms Fahy to ‘put [her] hat on’, ‘the media is here’. [page 121] Ms Fahy alleged that this abandonment significantly contributed to the post-traumatic stress disorder from which she later suffered. Issues: Was it negligent for the senior constable with whom she had been partnered to leave her alone with the doctor and victim? Was the nature of the counselling and debriefing provided to her after the incident reasonable? Should the Shirt approach be reconsidered? Decision: Affirming the trial judgment, the New South Wales Court of Appeal held that

there was no valid reason for leaving her alone and that her exposure to the victim’s plight, without reasonable assistance from her partner, led to her psychiatric disorder. In a four to three decision, the High Court of Australia allowed the state’s appeal. Gleeson CJ implicitly endorsed Mason J’s approach in Shirt, stating that it did not need reconsideration. He stated that any alleged problems associated with its use derived from the misapplication of its principles rather than the principles themselves. Applying Shirt, he dissented, concluding that there was no reason to reverse the lower court’s decision. Gummow and Hayne JJ declined to reconsider Mason J’s approach, noting how frequently it had been applied and how no valid argument had been made for its reconsideration. They stated (at [78]–[79]): [T]he fact … that Shirt has not always been applied properly does not provide any persuasive reason to reconsider its correctness. Further … the fact that States and Territories have chosen to enact legislation which, in some cases, may alter the way in which questions of breach of duty of care are to be approached in actions for damages for negligence provides no reason to re-express this aspect of the common law. If anything, the diversity of legislative approaches … points away from the desirability of restating the common law. However, their application of Shirt led to a different result to that of Gleeson CJ, clearly demonstrating the flexibility of the approach and its inescapably value-laden nature. They held (at [61]) that while the risk of psychiatric harm was foreseeable in the circumstances, the police had in fact ‘taken steps to avoid, or at least ameliorate, the consequences of the stresses of police work’. The plaintiff had not identified what system of work should have been used to avoid psychiatric harm and the nature of the support that should have been provided. Further, officers may have ‘other conflicting responsibilities’ that must be considered in assessing the response to the risk of harm. Callinan and Heydon JJ also upheld the appeal. However, unlike Gleeson CJ, Gummow, Hayne, Kirby and Crennan JJ (who did not think this was an appropriate case for Shirt’s reconsideration) stated that the Shirt approach should be reconsidered (at [226]): These and very many other cases in which the test in Shirt has been sought to be applied [Vairy v Wyong Shire Council and Mulligan v Coffs Harbour City Council are cited: see 3.63] are not simply ones of misapplication. They demonstrate how unrealistic and difficult in practice the test is. … [P]laintiffs’ hopes of large awards of damages have been raised by unduly sympathetic trial and intermediate courts only and inevitably to be dashed on final appeal, and too onerous a burden has been placed upon defendants and insurers. Legislatures too have reacted against the test by enacting legislation to make the recovery of substantial damages for personal injuries for negligence more difficult. So unrealistic on occasions have [page 122] been the decisions, that the courts themselves have jeopardised their standing and reputation.

… [A] flexible and realistic test should be substituted for a test of foreseeability of fancifulness or otherwise. The test that commends itself to us is the one stated by Walsh J at first instance in The Wagon Mound (No 2) [[1967] 1 AC 617], that what should be foreseen is a risk that is ‘significant enough in a practical sense’. Dissenting, Crennan J agreed with the inferences drawn by the trial judge, favouring the plaintiff. Kirby J agreed, noting that the appeal court should not interfere with the primary judge’s decision as there was no demonstrated error with the court’s reasoning. Applying Shirt, he stated (at [85]) that the employer had failed to enforce, or ‘maintain and carry out its own system of work, protective of the respondent’. Noting (at [115]) that ‘the Shirt formulation is one which encourages, and promotes, consideration of the necessities of accident prevention’, Kirby J was unwilling to formulate a new common law approach, using the terms set out in the newly enacted Civil Liability Acts (including the ‘not insignificant’ test). Like Gleeson CJ, Gummow and Hayne JJ, he noted that any misapplication of Shirt’s nuanced formulation is not a valid reason to abandon it. He rejected the argument that it should be re-expressed (at [132]): Because … I regard the communitarian notion of accident prevention as an important and desirable operative consequence of the law of negligence, I would not myself favour any re-expression of the law that would endorse a reduced vigilance in respect of accident prevention. Parliament can, if it chooses, endorse ‘notions of selfishness that are the antithesis of the Atkinian concept of the legal duty that we all owe, in some circumstances, to each other as “neighbours”’ [Neindorf v Junkovic (2005) 222 ALR 631 at [85]]. However, it is not a direction that, in my view, the common law of Australia has taken or should take. Commenting on the need to provide mutual support via its buddy system and reinforcement of officers at trauma scenes, and post-trauma support, Kirby J stated that Fahy’s partner’s abandonment was unjustified in these ‘gruesome and traumatic’ circumstances. He concluded (at [160]) that ‘the coldness, indifference and lack of support for the respondent was evidence of the culture of the police employment’. Chastising the High Court of Australia’s general attitude in these types of claims and the deleterious consequences this trend has on the community, Kirby J asserted (at [172]): The approach of the majority … is yet another instance of the Court’s recent disfavour towards plaintiffs’ claims in personal injury cases. It is the more surprising because it is expressed in the context of employment, where the law has traditionally been at its most protective. It is specially unfortunate because the facts disclose the devoted, but unsupported, work of Ms Fahy whose conduct as a police constable helped save a victim’s life but at the same time needlessly subjected her to unrelieved stress. … I regard this decision as a reaffirmation of this Court’s retreat from its former communitarian approach to negligence liability. The Court turns its back on accident prevention in employment which, not so long ago, was a major theme of our negligence doctrine. Indifference on the part of employers is restored and rewarded.

The ‘calculus of negligence’: under the statutes 3.40 The approach embraced by the ‘calculus of negligence’ has been included in the legislative interventions in each jurisdiction except the Northern Territory. [page 123] The statutory provisions, based on the Ipp Panel’s recommendations, reflect the common law position:19 (2) In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things): (a) the probability that the harm would occur if care were not taken, (b) the likely seriousness of the harm, (c) the burden of taking precautions to avoid the risk of harm, (d) the social utility of the activity that creates the risk of harm.

For an example of an early case applying these provisions, see Telstra Corp Ltd v Bisley [2005] NSWCA 128. In Vella v Permanent Mortgages Pty Ltd, Young J observed (at [530]), ‘[s]ection 5B … seems to embrace substantially what was once called the “Shirt Calculus”’. Waverley Council v Ferreira [2005] NSWCA 418, Mobbs v Kain and Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd (see 3.57) held views similar to those advanced in Vella, as did the Department of Housing and Works v Smith (No 2), decided by the Western Australia Court of Appeal. In Refrigerated Roadways, Campbell JA (at [175], [177]) referred to Ipp JA in Ferreira, stating: … [H]is Honour rejected the notion that section 5B(2)(d) added anything novel to the law, saying: ‘It simply gives expression to the idea that some activities are more worth taking risks for than others.’ … While section 5B(2) articulates clearly the process of reasoning that would have been involved under the common law in application of the test in Shirt for identifying what steps the taking of reasonable care requires, it does not show any intention to alter the common law on that topic. …

In a separate opinion in that case, Sackville JA emphasised that in

his view courts are required to carefully follow the statute’s terms, with a methodical consideration of all its elements, despite the Act’s similarity to the common law (see 3.57). Allsop P observed in Stephens v Giovenco [2011] NSWCA 53 at [28]: The section has a structure similar to the operation of Wyong Shire Council v Shirt, but the terms of the section should be attended to. That said, s 5B operates against the backdrop of the common law of negligence and incorporates concepts derived from the common law.

In Adeels Palace Pty Ltd v Moubarak (a case primarily concerned with questions of causation (see 4.8, 4.21)), the High Court of Australia highlighted the need [page 124] to determine breach questions under the state’s Civil Liability Act. The breach issue involved what a reasonable person in the position of Adeels Palace would have done, by way of precautions, in response to the ‘not insignificant’ risk of violent, disorderly or quarrelsome conduct in the restaurant. The considerations identified in s 5B of the New South Wales Act had to be assessed prospectively, without hindsight, to determine how many, if any, security personnel ought to have been provided. The court (at [39]) critically commented on ‘an absence of consideration at trial of the matters prescribed by s 5B’, refusing to form an opinion on whether a breach was proved and whether the evidence adduced at trial could be supported. It focused its attention on causation, which the plaintiffs failed to establish. In the following sections, we have selected a number of cases to illustrate the ways in which aspects of the calculus operate. It is important to note that not all of these cases were decided under the Civil Liability Acts. Useful illustrations of the calculus principles have come from cases decided at common law.

Probability that the harm would occur: part of the ‘calculus’

3.41 The following case illustrates how the High Court of Australia has considered ‘probability’ as part of its breach assessment. The ways in which other breach factors feature in its assessment are noteworthy. Key Case Roads and Traffic Authority of New South Wales v Dederer (2007) 234 CLR 330; 238 ALR 761 Facts: The plaintiff (then 14 years old) dived off a bridge near Forster, New South Wales, striking a sandbar. He became a partial paraplegic. He sued the Roads and Traffic Authority (RTA) and council in negligence. Over a number of years, the plaintiff had seen many children and adults diving and jumping off the bridge into water he thought was deep (as boats passed beneath the bridge and he had never seen them run aground). The day before his accident, he saw a ‘big sign’ which said, ‘Fishing and Climbing Prohibited’. He was also aware of a pictogram indicating ‘no diving’. However, he had never seen police or rangers admonishing anyone for jumping off the bridge. For years, it was common knowledge in the community, and well known to the defendants, that young persons jumped and dived off the bridge. Issue: When assessing whether or not the defendant failed to take reasonable care, how should the factor of ‘probability’ be addressed? Decision: Applying the Civil Liability Act 2002 (NSW), the trial judge held that the signs relied upon by the defendant were essentially ineffective — and an unreasonable precaution. While the lower court accepted that the plaintiff was engaged in a recreational activity, which was objectively ‘dangerous’, the judge did not find it was an ‘obvious risk’ (see 11.27). The Court of Appeal upheld the trial judgment. [page 125] Ultimately, the plaintiff failed, as the High Court of Australia reversed the lower court in a three to two decision. As part of the majority, Gummow J canvassed ‘scope of the duty’ issues. He emphasised that all that is expected of a defendant is the exercise of reasonable care, not some more stringent requirement of prevention, and that the Court of Appeal had erred by characterising the risk as one of ‘serious spinal injury flowing from the act of diving off the bridge’ (Gummow J at [60]): [This] obscured the true source of potential injury. This arose not from the state of the bridge itself, but rather from the risk of impact upon jumping into the potentially shallow water and shifting sands. … This mischaracterisation of the risk led to two consequent errors. First, the majority were distracted from a proper evaluation of the probability of that risk occurring. Secondly, they erroneously attributed to the RTA a greater control over the risk than it possessed.

In his view (at [61]), it was incorrect to focus on: … the frequency of the antecedent course of conduct, namely jumping and diving, and not on the probability of the risk of injury occurring as a result of that conduct, namely impact in shallow water. … [T]he frequency of jumping and diving was only startling if one ignored the fact that no-one was injured until Mr Dederer’s unfortunate accident. Far from being a risk with a high probability of occurrence, the probability was in truth very low … Having regard to Shirt’s requirements for a ‘contextual and balanced assessment of the reasonable response to a foreseeable risk’ (at [69]), the response here (warning signs prohibiting the plaintiff’s conduct) was reasonable; the measures suggested by the plaintiff were not warranted. Gummow J stated (at [71]–[72]): The magnitude of the risk was self-evidently grave. … The probability of that injury occurring was, however, low [no-one had previously been injured]. … What, then, of the expense, difficulty and inconvenience of taking alleviating action? The erection of further warning signs would not have been expensive, but Mr Dederer provided no evidence that they would be reasonable. The installation of pool-type fencing and a triangular cap on the handrail would have been more expensive and intrusive. … Callinan J also highlighted the fact that in 40 years, many had dived but no-one had been injured, stating (at [274]) that ‘the risk, although undisputedly present, had a very low degree of probability of realisation’. He further considered ‘soft factors’ (see 3.62) and practicable precautions (at [275], [278]): Also, to be balanced, are the interests of the community in being able to walk across the bridge, to enjoy the view, and to pause and lean in comfort on a flat surface of a top rail as they do so. Only an extremely high unscaleable fence, with perhaps shards of glass embedded in its top, or barbed, or electric, or razor wires, might … have deterred determined and adventurous youths from climbing and jumping. … Other measures such as the provision permanently of a sufficient number of police or other officials would exceed the requirements of a reasonable response. … A defendant is not an insurer. Defendants are not under absolute duties to prevent injury, or indeed even to take all such measures as might make it less likely to occur. … A proper balancing exercise … leads inescapably to the conclusion that the appellant, in responding to a risk that had not been realised for forty years by erecting pictograph signs, acted reasonably and adequately. …

[page 126]

Case Example Shaw v Thomas [2010] NSWCA 169 Facts: See 3.36. Issue: Had the parents acted reasonably, bearing in mind the risk was ‘not insignificant’? Decision: The New South Wales Court of Appeal reversed the lower court, finding the parents were not in breach of their duty. Macfarlan JA (Beazley and Tobias JJA agreeing)) cited and applied Dederer (at [48]–[49]): [A] duty of care ‘imposes an obligation to exercise reasonable care; it does not impose a duty to prevent potentially harmful conduct’ (… Dederer …). Accordingly, the fact that what was an undoubtedly tragic accident might, or even would, not have occurred if the bunk bed had had a ladder and guard-rail does not answer the question of whether there was a failure … to take reasonable care … [T]he ‘probability that harm would occur if care were not taken’ here … was, as it was in … Dederer, a very low one … The risk of a normal 10 year old child not being able safely to negotiate a descent from such a low height without using a guard-rail or ladder was … very small indeed. The court held that a reasonable person in the parents’ position would not have responded to this risk (‘such risk as there was’) by installing a ladder or guard-rail. Further, there was no basis for holding that a reasonable person in the defendant’s position would have been aware of the contents of Australian Standards in responding to this foreseeable risk. Despite assessing the risk as ‘not insignificant’, the court had held that the parents were not expected to have been aware of the Standards. (See 3.36 for the court’s application of the ‘not insignificant’ risk requirement.)

In Shoalhaven City Council v Pender [2013] NSWCA 210, the New South Wales Court of Appeal considered a case in which a ferry operator sustained injuries in the course of employment when he slipped and fell off the ramp where a ferry was docked; the ramp had a buildup of algae, mud and debris. Citing Dederer, McColl JA (at [85]) held that the trial judge had failed to accurately identify the risk of harm by defining it too broadly, as a ‘slippery ramp’. Ward JA disagreed, holding that the risk had been defined with sufficient precision; however, he agreed with McColl JA that causation had not

been established. Barrett JA agreed with both. The defendant’s appeal was allowed.

The likely seriousness of the harm (gravity): part of the ‘calculus’ 3.42 One of the factors the court must take into account, balanced with other factors in every case (clearly evident in Dederer, for example), is the gravity of the harm that the plaintiff may have suffered. This will differ depending on the circumstances of the case. In conjunction with probability, it affects the precautions that ought to have been taken by the reasonable person in the defendant’s position. The greater the harm that may befall the plaintiff if the risk of injury eventuates, [page 127] the greater the precautions that are required of the defendant. It can therefore be a significant factor in the balancing process. The following case considers this factor in a special context, involving the defendant’s awareness of a heightened risk of potential harm. Case Example Paris v Stepney Borough Council [1951] AC 367 Facts: The plaintiff was employed as a garage-hand by the defendant. The plaintiff had only one eye, and his employer, the defendant, was aware of his disability. The plaintiff was blinded by a metal chip, which flew into his good eye while he was trying to loosen a rusty axle with a hammer. He sued his employer. The evidence established that the defendant supplied goggles to its welders and tool-grinders, but not to employees working on maintenance and repair of vehicles. Issue: Was the employer negligent by failing to provide the plaintiff with protective goggles? Decision: By a majority of three to two, the House of Lords held that the defendant had

been negligent. Lord Morton of Henryton said (at 385–6): In considering generally the precautions which an employer ought to take for the protection of his workmen it must … be right to take into account … the likelihood of an accident happening and the gravity of the consequences … [I]f … A and B, who are engaged on the same work, run precisely the same risk of an accident happening, but if the results of an accident will be more serious to A than to B, precautions which are adequate in the case of B may not be adequate in the case of A, and it is the duty of the employer to take such additional precautions for the safety of A as may be reasonable. The duty to take reasonable precautions against injury is one which is owed by the employer to every individual workman.

3.43 The Paris principle applies only where the defendant knows, or ought to know, of the facts that show that injury, if suffered, will be particularly grave. For example, in Brkovic v JO Clough & Son Pty Ltd (1983) 49 ALR 256, the plaintiff had a susceptibility to back injury, and he injured his back while lifting a length of steel pipe at work. The High Court of Australia held that there was insufficient evidence to establish that the defendant employer either knew or ought to have known of the plaintiff’s susceptibility to back injury. As the defendant’s system of work did not pose a risk of injury to a worker ‘within the normal range of health and strength’ (Gibbs J at 257), the defendant was not liable in negligence for the plaintiff’s injuries. In Basha v Vocational Capacity Centre Pty Ltd [2009] NSWCA 409, the plaintiff, in receipt of workers’ compensation, was required to undertake rehabilitation and a vocational assessment of her capacity to undertake certain physical tasks. She alleged that the assessment was conducted negligently, as she was asked to undertake exercises beyond her ability, considering her medical condition. This led [page 128] to her suffering further injury, requiring additional surgery. The New South Wales Court of Appeal (McColl JA; Tobias JA and McClellan CJ agreeing) noted (at [67]) that its decision as to whether or not the

defendant had discharged its duty of care, ‘had to be assessed at the time of their allegedly tortious conduct, by looking forward to identify what a reasonable person in their position, confronted with a foreseeable risk of injury, would have done in response’. The defendant failed to properly have regard to ‘the magnitude of the consequences if the perceived risk came home’ (at [71]).

The burden of taking practicable precautions: part of the ‘calculus’ 3.44 One of the factors or elements of the ‘calculus’ that commands much of the courts’ attention in a large number of cases involves the nature of the practicable precautions the defendant ought to have taken or implemented. Recall, though, that this factor must be balanced against the others in the ‘calculus of negligence’ (under the Acts and at common law). While this factor is important, it is not in itself conclusive of reasonableness or carelessness. In Shirt’s case itself, the High Court of Australia held that there was a reasonably foreseeable risk of injury in putting up ambiguous signs which were marked ‘Deep Water’ in a predominantly shallow lake. Precautions against that risk were simple, cheap and readily available to the defendant: the signs could have been changed to read ‘Deep Water Between Signs’ or words to that effect. As this precaution was reasonably practicable in the circumstances, a reasonable person in the defendant’s position would have taken it, or one like it. The defendant’s failure to do so was negligent. That negligence was established on proof that reasonably practicable precautions existed to guard against that reasonably foreseeable risk. 3.45 Mason J’s approach in Shirt’s case allows for a consideration of the ‘expense, difficulty and inconvenience of taking alleviating action’. This is reflected in the Civil Liability Acts, and is to be weighed with the other factors to assess the reasonableness of the response to the risk. Several jurisdictions’ statutes also state that similar risks of harm for which the defendant is responsible are to be included in an assessment of the ‘burden of taking precautions’. In a sense, the

provisions recognise that in some circumstances, defendants may have had to face difficult choices. Reflecting the common law, the statutes further state that liability will not necessarily be found just because there may have been a different way of doing things that would have avoided a risk of harm.20 3.46 The following case is one of many that illustrate the process used in balancing the burden of precautions against the magnitude of the reasonably foreseeable risk. [page 129] Case Example Romeo v Conservation Commission of the Northern Territory (1998) 192 CLR 431; 151 ALR 263 Facts: The plaintiff was injured when she fell off a cliff at a popular viewing spot in a national park, controlled by the defendant. She was under the influence of alcohol at the time. There was no fence or warning sign where she fell. She sued the defendant. Issue: Was the failure to put up signs or a fence unreasonable? Decision: By a majority of five to two, the High Court held that although there was a small but foreseeable risk that someone such as the plaintiff would fall over the cliff, a reasonable statutory authority in the defendant’s position would not have done anything to guard against that risk, because the burden of the precautions to guard against it would have been unreasonably high. Kirby J said (at CLR 481–2; ALR 302): It is true to say that the [defendant], acting reasonably, would have to anticipate a variety of visitors, including children, the elderly, the shortsighted, the intoxicated and the exuberant. However, because the risk was obvious and because the natural condition of the cliffs was part of their attraction, the suggestion that the cliffs should have been enclosed by a barrier must be tested by the proposition that all equivalent sites for which the [defendant] was responsible would have to be so fenced. The proposition that such precautions were necessary to arrest the passage of an inattentive young woman affected by alcohol is simply not reasonable. The perceived magnitude of risk, the remote possibility that an accident would occur, the expense, difficulty and inconvenience of alleviating conduct and the other proper priorities of the [defendant] confirm the conclusion that breach of the [defendant]’s duty of care to the [plaintiff] was not established. McHugh J wrote a powerful, persuasive, dissenting opinion, in which he stated that finding a breach on the facts in question, not providing appropriate fencing at that

particularly dangerous site, did not mean that to avoid liability the defendant had to take similar precautions throughout the reserve (and cliffs) that it controlled. A breach determination on these facts did not mean that the same conclusion would result in different circumstances, at different geographical locations.

As was noted earlier and has been evident to this point, there are many examples in which courts explicitly balance the burden of taking precautions to avoid the risk of harm against other factors in the calculus. For example, in Mobbs v Kain, a driver, adhering to the speed limit, struck a child when the child stepped out from in front of school bus. The New South Wales Court of Appeal (McColl JA, Macfarlan JA agreeing) held that in the circumstances, the driver need not have slowed down to whatever speed would have avoided the accident, in anticipation of a child getting off a bus. The driver, complying with the speed limit in these circumstances, acted reasonably. Citing Gummow and Hayne JJ in New South Wales v Fahy (see 3.39) and Hayne J in Vairy v Wyong Shire Council (see 3.63), the court (at [103]) highlighted the need for it ‘to look forward to identify what a reasonable person would have [page 130] done in the circumstances, not backwards to identify what would have avoided the injury’. Their Honours cautioned (at [101]) against turning an obligation to take reasonable care into one that imposes strict or absolute liability: [T]o find breach for failing to take precautions against a risk of harm, not only must the risk be foreseeable and not insignificant, it must also be such as, in the circumstances, a reasonable person in the person’s position would have taken those precautions.

The New South Wales Court of Appeal in Shaw v Thomas (see 3.36, 3.41) noted (at [60]) that the low expense associated with installing a guard-rail or ladder was ‘not determinative and … is not of great significance … where the probability of harm occurring and the

likelihood of any harm being serious … were both very low’ (as in that case). Other factors, such as social utility, were also considered. In Harrington Estates (NSW) Pty Ltd (t/as Harrington Grove Country Club) v Turner [2016] NSWCA 369 the plaintiff attended his daughter’s wedding at the defendant Club. At about 10:30 in the evening, he carried the wedding cake remains to the boot of his car. At the rear of the parking bay was a concrete kerb; just beyond the kerb was a deep, sunken garden bed whose depth was obscured by vegetation. As the plaintiff closed the boot, he stepped back and fell into the garden bed, suffering serious injuries. Holding the Club and architect negligent, Leeming JA (Gleeson JA and Harrison J agreeing) of the New South Wales Court of Appeal noted (at [45]): [A]lthough it was not shown that there had been any breach of the Building Code of Australia, the car park was in a club, which would have numerous patrons, including those who were unfamiliar with the layout of the car park, who might be attending at night, and who might have consumed alcohol. Such patrons would have occasion to go to the rear of each car space within the car park …

The defendants must have been able to envisage that at some point the plants would grow and conceal the bed’s true depth. In these circumstances, the probability of harm occurring was not low and the likely seriousness of the harm was quite high such that a reasonable person would have taken appropriate precautions to avoid the risk of someone falling into the garden bed. The court stated (at [51]) that compliance with the building code standards, as here, ‘cannot be determinative’ of the question of breach (see 3.14). The respondent in Woolworths Ltd v Grimshaw [2016] QCA 274, who had been working at the appellant’s store, slipped on a grape and injured her back. The Supreme Court of Queensland, Court of Appeal held that there was a foreseeable risk of injury to employees and customers from grapes falling to the floor and that a reasonable employer would have installed non-slip mats to guard against the risk. With respect to the probability of harm, McMurdo P (Applegarth and Flanagan JJ agreeing) observed (at [36]): [I]n the 2009 financial year … [Woolworths] had 1,463 incidents in stores where

employees or customers slipped on fallen grapes; about 10 per cent of all customer injuries were specifically grape-related.

[page 131] Regarding the burden of taking precautions, her Honour stated (at [39]): ‘[The mats] were not costly; were available; and could easily have been utilised.’ The court also considered contributory negligence issues: see 10.30. In Lee v Carlton Crest Hotel (Sydney) Pty Ltd [2014] NSWSC 1280 the plaintiff’s husband plummeted to his death when reversing into an empty space on the second level of a multi-level car park at the defendant hotel; a perimeter railing disintegrated and the car fell off the edge. Evidence later disclosed that: (i) only one end of the wheel stop at the back of the car space was affixed and (ii) the perimeter barrier (a pedestrian railing) was grossly inadequate in terms of strength and did not comply with safety standards. Beech-Jones J held (at [145]) that the risk of a vehicle colliding with the perimeter railing (a pedestrian railing) was foreseeable and ‘not insignificant’, particularly given the number of wheel stops that were loose (to the knowledge of the defendant) and the stops were meant to act as an indicator to drivers that they were at the end of their car space, the size of the car park and its location. His Honour observed (at [157], [158]) that the implementation of an inspection regime was not overly burdensome, bearing in mind the scale of the car park’s operations and its profitability: Ceasing to use parts of the car park would involve loss of revenue, and repairing the external barriers would no doubt involve very substantial building costs … Nevertheless, the continued operation of such a large commercial car park in such a condition was untenable.

In the court’s view (at [157]), the exercise of reasonable care required the car park to be inspected for any significant or obvious defects and to temporarily or permanently close sections of the car park for repair if required. An inspection system would have led to

‘ameliorative action’ (at [151]). The defendant car park breached its duty of care by failing to take these precautions. The City of Sydney Council also was found liable (at [8]) for an unreasonable inspection and exercise of powers with respect to the construction of the car park, which was not built in compliance with ordinance provisions; the court held that the council was not protected by s 44 of the Civil Liability Act 2002 (NSW). The respondent in Jurox Pty Ltd v Fullick [2016] NSWCA 180 was assigned to work as a production operator at a factory owned by the appellant, with responsibility for emptying large bags of a sugar substance and a salt substance into ‘hoppers’ (machines that packed products). While performing this task, she injured her back. She had been instructed how to safely unload the bags but she departed from this practice. Simpson JA (Rothman JA agreeing, Leeming JA dissenting) of the New South Wales Court of Appeal held that the appellant was negligent for inadequately supervising the operation and ensuring the bags were unloaded safely. Their Honours remarked (at [81]): ‘[E]ven a modicum of supervision would have exposed the incorrect method that the respondent was using. … Measures that could have been taken to avoid the harm eventuating could hardly be described as burdensome.’ The court continued (at [81]), that constant supervision was not required; rather, reasonable attention to whether the respondent absorbed the instructions about the process to follow would have sufficed. [page 132] 3.47 Two notable High Court of Australia cases, Roman Catholic Church Trustees for the Diocese of Canberra and Goulburn v Hadba (2005) 221 CLR 161; 216 ALR 415 and New South Wales v Bujdoso (2005) 222 ALR 663 (see 3.50), assess the reasonableness (or otherwise) of systems implemented by institutions in response to potential harm to vulnerable persons to whom duties to take care are owed. They provide good illustrations of the interaction between the burden on the

defendant — the practicable precautions against risk — and the other side of the balance, probability and the gravity of the risk if it were to materialise. They also consider ‘conflicting responsibilities’ (as in New South Wales v Fahy (see 3.61) and ‘social utility’ (see 3.60) as potential justifiability for their actions. Although the Hadba and Bujdoso cases arose in dissimilar contexts, their reasoning is not dissimilar. Both employ the Shirt approach to assess the appropriate standard of care that ought to be discharged by the reasonable defendant in the circumstances. Before we consider the detention system at issue in Bujdoso, we discuss Roman Catholic Church Trustees for the Diocese of Canberra and Goulburn v Hadba and a few other cases involving schools and breach assessments. Case Example Roman Catholic Church Trustees for the Diocese of Canberra and Goulburn v Hadba (2005) 221 CLR 161; 216 ALR 415 Facts: The defendant school had playground equipment called a ‘flying fox’. It had a platform and vertical pole at each end, linked by a horizontal pole to which a sliding triangle was attached. A child using it is meant to grasp the triangle to slide from one end to the other. To prevent injuries, the school used a well-publicised ‘hands off rule’, requiring students to not touch each other while playing in the playground. It was often selected as the ‘rule of the week’. Students were specifically told to not touch each other while using the flying fox. It had been in the playground for six years and had been used thousands of times without (serious) incident. One recess, with 40 children in the fixed equipment area, a pupil, aged eight, climbed the platform and took hold of the triangle. A boy and girl grabbed her legs, in breach of the ‘hands off rule’. She struggled to free herself, calling on the others to stop. Pulled from the fox, her face struck the platform as she fell. Although a ‘capable teacher’ with considerable experience was on duty, she did not observe the incident, as she had been surveying the water fountains and toilet block. About 20–30 seconds elapsed between when the teacher left the spot in the playground where she could see the flying fox to when she was told of the accident. Issue: Was the supervision system reasonable? (The teacher’s conduct was not in issue.) Decision: The majority (Gleeson CJ, Hayne, Callinan and Heydon JJ) held that the plaintiff had not demonstrated that there was an appropriate system of supervision which was a practicable alternative to what the school had been using. Little evidence was called to support her case, such as guidelines from elsewhere and industry standards. She had not shown what a reasonable response would be, for

[page 133] example, staffing arrangements. Applying the Shirt approach, the court assessed the reasonableness of suggested precautions as a response to the risk of foreseeable harm. Because no previous incident had occurred, the magnitude of risk of injury and degree of probability of its occurrence were low. Moreover, there was a well-known, enforced school policy in place. Further, if staff were asked to increase supervision, this would create inconveniences, as they were entitled to breaks. The court noted (at [25]) several potential negative consequences that would result from a system that required additional supervision: Nor is it reasonable to have a system in which children are observed during particular activities for every single moment of time — it is damaging to teacher– pupil relationships by removing even the slightest element of trust; it is likely to retard the development of responsibility in children, and it is likely to call for a great increase in the number of supervising teachers and in the costs of providing them. McHugh J dissented, in strong terms (at [34]): Unfortunately, the system in place for supervising … had an inherent defect that gave rise to a risk of injury to young children in the equipment area. It was a risk that would have been foreseen and avoided if the school had exercised reasonable care. … [A]t different times during recesses, children playing on or in the vicinity of the playground equipment were unsupervised. In his view, the pupils were ‘waiting for an opportunity to be mischievous’ (at [38]). Indeed, what occurred should have been expected (at [43]): Once a reasonable person foresees that a system or situation for which he or she is responsible gives rise to a risk of injury, negligence doctrine requires that person to consider the magnitude of the risk and the probability of its occurrence. It then requires the person responsible for the risk to balance those variables against any conflicting responsibilities and the expense, difficulty and inconvenience of taking action to eliminate or reduce the risk. … [It] requires the person who is responsible for the risk to make a value judgment as to whether the variables calling for action are outweighed by the burden of taking action. McHugh J stated that even though the response differs from situation to situation, negligence imposes a higher standard of care on those responsible for creating risks involving vulnerable persons such as employees, prisoners and schoolchildren. The fact that no previous incident had occurred did not mean the magnitude and the probability of serious injury are low. Warnings were inadequate, as they would hardly be at the forefront of children’s minds when the opportunity for mischief was present. Further, the burden on school trustees to take remedial action was not great; the practicable precautions could be cost-free and would not lead to an intolerable breakdown of working conditions. He also observed that in a case like this, the absence of expert

evidence was not fatal; factual determinations concerning precautions were well within the grasp of laypersons.

3.48 By way of contrast, illustrating the fact-specific nature of breach and standard of care determinations, in Parkin v Australian Capital Territory Schools Authority [2005] ACTSC 3, the court found the school liable to a 13-year-old student, who injured his hand in an industrial design class, using the belt-sanding machine. The [page 134] class was supervised that day by a relief teacher with minimal experience with woodworking machinery, who had responsibility for 28 pupils. He had not been warned about previous incidents, nor the fact that some time before the accident it had been reported that the plaintiff sometimes ‘exhibited silly, unsafe behaviour in the workshop, requiring intervention and perhaps likely to lead to a serious accident’ (at [50]). The court held that a reasonable school in the circumstances would not have allowed the class to proceed (with its potential risks) under the supervision of a ‘relatively inexperienced generalist relief teacher’ (at [51]). The pupil was found to be 10 per cent contributorily negligent. Another case involving a school’s system of supervision and, more contentiously, a parent’s reasonableness, follows. Case Example St Mark’s Orthodox Coptic College v Abraham [2007] NSWCA 185 Facts: Early one morning, a child, aged nine, was dropped off at school by his father, who taught there, His father told him to stay on the ground floor and to not do any ‘silly stuff’. Disobeying his father, the child played with other children, climbed to the second floor and put his foot on to a balustrade. He slipped and fell, hitting his head. He successfully sued the school for not implementing an adequate (reasonable) system to supervise students prior to the commencement of the formal school day.

Issue: The school cross-claimed, seeking contribution from the father, who it argued had acted unreasonably in the circumstances. Had he? Decision: Although the New South Wales Court of Appeal held that the father owed his child a duty of care (itself a contentious issue (see 6.7)), it found that it had not been breached. While the school had to respond to the risk of injury to 382 students, the father only had to respond to the risk to his child, at that particular time and place. Different responses were expected of a reasonable school as opposed to a reasonable parent. The court noted that on a few previous occasions the father had dropped off his son early, without incident, so that his son, an ‘obedient child’ (at [49]), would ‘gain in confidence and maturity’ (at [46]). Finding that the father had in fact acted reasonably (despite the unusual, intimate knowledge he had of the school’s inadequate supervision system), the court stated (at [50]–[52]): The legal principles applicable to the law of negligence must accommodate the practical realties of everyday living: Neindorf v Junkovic [(2005) 222 ALR 631] … One of those practical realities is that the bringing up of children cannot be made risk-free. It is inevitable that children, even in the most careful and ordered households, will be exposed from time-to-time to risks of harm. This is inherent in the process of growing up, undergoing new experiences, and maturing … The risk to which Mr Abraham exposed Christopher was on the brink of foreseeability in the Shirt sense. For the risk to materialise … Christopher had to be incited to act mischievously by other students, he had to disobey the express instructions … and [page 135] thereby act completely out of character, his conduct had to be unnoticed by the teachers present … and he had to act in such a way as to cause himself harm. It was not likely that all these factors would coincide. On the other hand, Mr Abraham, understandably, believed that there were potential benefits to Christopher in allowing him to be at school during this period. Christopher was held 10 per cent contributorily negligent; the school was 90 per cent responsible.

3.49 The following case, noted above, considers allegations of negligence in a custodial institution, highlighting tensions that can arise between (i) individual prisoner safety and protection and (ii) the establishment of an environment that is meant to promote rehabilitation. See also 6.9. Case Example

New South Wales v Bujdoso (2005) 222 ALR 663 Facts: The plaintiff was a convicted sex offender, who was held in the lowest security section of a minimum security prison, having applied several times to be housed in this type of facility. Because of his crime, he was taunted by other prisoners and threatened. Prison authorities became aware of the threats made to his safety by other inmates and located weapons (metal knuckle dusters) in the facility. Some staff voiced concern for his safety. At one stage, despite the threats, Bujdoso signed a document stating that he did not feel he was in danger (as he wanted to remain in the minimum security facility). He was allocated a room furthest from the administration block, next to the showers and toilets. He had a key to his own room. The authorities believed that his fellow inmates so valued their relative freedom and right to participate in a work release program that they would not jeopardise these ‘rewards’ by attacking others (including Bujdoso). One evening, after returning from work, he was beaten severely by two to four inmates wielding iron bars. His brain felt like ‘jelly’; he lost consciousness; he suffered a skull fracture. On the night of the attack, a typical head count had been done: all had seemed fine. Issue: Was the prison in breach of its duty of care to a prisoner who was assaulted while in custody? Decision: Bujdoso sued the state, responsible for the prison system, for damages. Finding in favour of the defendant, the trial judge stated that the officer’s main job involved conducting head counts through random checking, and noted that there was a very low incidence of violence at this jail. He endorsed the view that work release prisoners could be trusted, so no special measures needed to be taken. Although supervision was minimal, in his view this was appropriate (that is, ‘reasonable’). Reversing the trial judgment, the Court of Appeal emphasised the fact that prisoners like Bujdoso are held in contempt by other prisoners and subject to abuse. Ipp JA [page 136] was influenced by the state having reduced the number of officers supervising the units, from two to one. The court noted that no thought had been given to personal safety issues, there were substantial periods when there was no supervision and the lock on the door was flimsy and out of date. While the lock may have protected a prisoner’s privacy, it would not adequately keep out others (intending to cause harm). The document he signed did not detract from the actual knowledge those in control had with respect to his safety, which was clearly at risk. Indeed, asking for this statement showed that they appreciated this. They simply did not want to be blamed if the risk materialised. Applying the Shirt approach, the court found a breach: a system based on trusting prisoners did not always work; there had been a serious past incident and minor infractions; the numbers of guards was reduced for reasons not connected to safety; the prison had actual knowledge Bujdoso was at risk, yet it took no additional steps to protect him.

On appeal, the state argued its system of incarceration balanced two sometimes competing objectives: an enlightened approach to rehabilitation and the security of the institution. The High Court of Australia unanimously found in favour of the detainee. It criticised the implication of the state’s argument that because of Bujdoso’s written statement (and wanting to work), he was responsible for his injuries. The court stressed that Bujdoso, a detainee, was not required to make a choice between rehabilitation and personal safety. The content of the duty owed by those charged with custody and care of the prison population is to protect inmates from violence, which is always possible. Clearly, those convicted of sexual crimes are at greater risk of harm; here the authorities knew he was at special risk and a likely target of violence, as they knew he had been threatened and taunted. At [48]–[49], the court noted that no measure had been taken in response to the risk as the defendant, unreasonably, placed all its trust in its classification system, treating it as if it were a virtually infallible solution to potential problems. This was not a case involving the expense associated with more supervision. Once the risk of physical injury was known, it called for measures to prevent it. Unfortunately, no effective measures were taken. Prisoners should have been checked more frequently and effectively; better and stronger locks and doors should have been utilised; there should have been weapons checks; and he should have been relocated within the unit. The court held (at [51]) that this would not have amounted to guaranteeing safety: ‘[R]easonable care was enough. And that was missing ….’ The court (at [36]) agreed with Ipp JA (Bujdoso v New South Wales (2004) 151 A Crim R 235 at [64]): ‘Nothing was done. In my view that was negligent.’

3.50 Arguably, the High Court’s decision in Bujdoso served one of tort’s fundamental objectives, raising standards, by holding the defendant accountable for its wrongdoing. However, prior to the delivery of the High Court decision, the New South Wales legislature enacted the Civil Liability Amendment (Offender Damages Trust Fund) Act 2005 (NSW), in direct response and opposition to the Court of Appeal decision favouring the plaintiff. According to the Second Reading Speech, this Act establishes a scheme whereby damages awards and compensation provided to offenders (like Bujdoso) are to be quarantined and held in a trust [page 137] fund, to enable victims of offenders to lodge claims against them. Neville Newell (Parliamentary Secretary, Tweed) stated: ‘Under the

scheme, when an offender is awarded damages or compensation from a government department, the offender’s personal injury victims will get the first opportunity to access the damages.’21 The statute was enacted in response to ‘community outrage’, directed at offenders receiving damages awards while in custody. What this ‘outrage’ unfortunately ignores is the reason for the payout: in Bujdoso, the plaintiff suffered a severe bashing, which was the result of the custodial facility’s negligence. Criticising the bill, Paul Crittenden (Wyong) stated: [I]t relieves to a large measure the burden on prison authorities in respect of their duty of care to prisoners under their control. … A consequence of this bill will be that people who are bashed will not bother to apply for damages because they will not be the beneficiary of such damages. … If we allow a law-of-the-jungle approach and bullying in gaols, we have not advanced very far, if at all … This legislation will simply make Long Bay gaol and every other so-called corrective institution in this State more brutal and dehumanising. As a result, we too will be dehumanised. Let us not masquerade this legislation as other than what it is. It is designed to stop bureaucrats being made accountable for their obligations and duties and to further debase every person not only in this place but in society as a whole.22

Dr Arthur Chesterfield-Evans agreed: Frankly, I am horrified by this bill; I can only think it is absolutely Kafkaesque. … Most members of the community would no doubt agree, that whatever the offence committed in the past by a prisoner, when the State has deprived him of his liberty it has a duty to take reasonable steps to ensure his physical safety while in detention. This Bill will clearly have the effect of discouraging prison inmates from ever taking proceedings against the State for a failure to carry out that duty. The consequence … will be that certain prisoners can be bashed with impunity and the prison authorities are unlikely to ever be called to account in the Courts for their failure to protect such inmates. It seems that there is an incentive for people in prison to bash other prisoners.23

The saga continued, with Bujdoso successfully challenging the Act, again to the outrage of the mainstream media. In New South Wales v Bujdoso (2007) 69 NSWLR 302, the New South Wales Court of Appeal held that the Act’s terms, such as the definitions ‘offender in custody’ and ‘offender damages’, did not apply to Bujdoso or his case: see Civil Liability Act 2002 (NSW) Pt 2A (‘special provisions for offenders in custody’). The Act was subsequently amended to fill this ‘legal loophole’.24

Another case involving a prisoner, Price v New South Wales [2011] NSWCA 341, is far less controversial. The New South Wales Court of Appeal reversed the trial [page 138] judge, finding in favour of an inmate who suffered a serious eye injury (detached retina) when struck by a tennis ball while sitting directly behind the baseline where the ball was being served. The court found a breach of duty, given the ease of taking precautions. Allsop P (Beazley and Giles JJA agreeing) stated (at [44]): ‘[T]he nature of the risk and the extent of possible injury, depending upon where one was hit, could have been eliminated easily and without cost or other inconvenience by asking or requiring Mr Price and others seated in similar positions to move.’

Problems of proving practicable precautions 3.51 The onus is on the plaintiff to prove that precautions were available to guard against the reasonably foreseeable risk of injury, and that they were reasonably practicable. In many cases, the availability and practicability of precautions against the risk of injury are obvious as a matter of common knowledge or common sense. For example, in Laybutt v Glover Gibbs Pty Ltd (t/as Balfours NSW Pty Ltd) (2005) 221 ALR 310, the High Court of Australia concluded that it was reasonable for a jury to use its experience and knowledge of the world to assess what a reasonable employer would have done by way of providing practicable instructions (to guard against injury) to a pastry chef, who had been required to reassemble a slippery (recently washed) sharp-edged machine. However, if the availability and practicability of precautions are not obvious, the plaintiff must show what precautions the defendant could have taken but did not take. If the plaintiff cannot do so, her or his action fails. By way of example, in Penrith Rugby League Club Ltd (t/as

Cardiff Panthers) v Elliot [2009] NSWCA 247, the plaintiff slipped and fell in a car park, where floodlights failed to operate. The New South Wales Court of Appeal reversed the trial judgment, finding that the defendant’s obligation was to exercise reasonable care to provide adequate lighting and not one that ensured lights would operate in the evening. The court held (at [37]): The evidence … is simply insufficient to justify a finding that a reasonable person in the position of the appellant would have instituted a system of visual inspection of the floodlights at or shortly after sunset. The burden was upon the respondent to adduce evidence supporting such a finding, but she did not do so.

In Fabre v Lui [2015] NSWCA 157, the appellant, the lessee of premises owned by the respondent, was cleaning the range hood over the cooking stove. It fell from the wall, injuring her. It had been installed by a tradesperson for the respondent three years previously. The plaintiff argued that the respondent failed to make appropriate inquiries to establish the competence of the handyperson who installed the range hood. MacFarlan JA stated (at [27]) that to avoid error, the substance of the statutory elements have to be addressed even though they may not be referred to specifically. Applying the provisions (at [31]–[33]), MacFarlan JA held that because a heavy appliance might be inadequately affixed to the wall of a well-used kitchen and could fall on a person, probability that serious harm could occur was high if care was not taken. The burden of taking precautions to avoid the risk of [page 139] harm was not great: questions about the handyperson’s experience or qualifications could easily have been asked and alternative quotes sought, although the latter might have led to delay. However, his Honour concluded (Meagher and Basten JJA agreeing) (at [34]) that even though a reasonable person might have made inquiries about the installer’s competence, s 5B(2) poses a different question: whether a

reasonable person would have taken the relevant precautions. The respondent was not negligent for failing to make the inquiries. The following case starkly highlights the problems a plaintiff can face when trying to prove in a scientific, technical context, the kinds of practicable precautions the defendant ought to have taken, as a reasonable person. It also illustrates the ways in which an individual’s value judgments — as juror or judge as fact finder — can influence the ‘calculus’ assessment and a reasonable person’s response to a foreseeable risk of harm. Case Example Thompson v Johnson & Johnson Pty Ltd [1991] 2 VR 449 Facts: The plaintiff suffered toxic shock syndrome (TSS) as a result of using tampons manufactured and distributed by the defendant. She did not claim that there was a failure by the defendant with respect to the product’s composition or the manufacturing process. Rather, she argued that the defendant ought to have (i) warned consumers about the (rare) risk of suffering from TSS and (ii) made doctors aware of TSS symptoms, to be able to properly diagnose and treat patients. Issue: What must the plaintiff prove to establish carelessness? Decision: The plaintiff failed on both counts in the Full Court of the Supreme Court of Victoria. With respect to warning consumers, the Full Court agreed with the trial judge’s finding. In the court’s view, the plaintiff had not demonstrated, on the facts, what the company could have done (or ought to have done) by way of practicable precautions, once it was aware of the rare risk that some consumers might suffer from TSS as a result of using Carefree tampons. She had not proven, to the court’s satisfaction, how she as a consumer reasonably could have been informed of the risk of TSS by means of advertising campaigns, warnings on packages, or leaflets. The time period in which the company would have had to respond to the risk was considered to be very brief — a few months, commencing from when the reasonable company ought to have known of the risk to when she used the product. Reversing the trial judge, the Full Court also held that she was unable to prove what kind of effective measure could have been taken to inform doctors of this risk of harm.

3.52 Problems plaintiffs can face establishing the kinds of practicable precautions that ought to have been taken are further illustrated in the following cases.

[page 140] Case Example Neill v New South Wales Fresh Food & Ice Pty Ltd (1963) 108 CLR 362; [1963] ALR 258 Facts: The plaintiff was injured when he slipped and fell while cleaning the inside of a milk transporter, a large cylindrical tank lined inside with stainless steel, mounted on a railway wagon. The inside of the tank was very slippery because of a film of milk residue. Its slipperiness was made worse by the soapy water with which the plaintiff was required to clean the tank. The plaintiff alleged that his employer had negligently failed to provide a safe system for cleaning the inside of the tank. The plaintiff called no evidence to show what steps, if any, could have been taken to minimise or eliminate the risk of slipping. Issue: What evidence needs to be called to establish the precautions that ought to have been taken? Decision: The High Court of Australia held that the defendant was not liable: the conclusion that it should have provided non-slip boots or a handrail was not open to the jury as a matter of common knowledge, and the plaintiff had failed to prove that such precautions would have been practicable, permissible or appropriate in the circumstances.

Case Example Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460; 186 ALR 145 Facts: See 3.8. One of the breaches alleged against the organiser of the indoor cricket match (and occupier of the premises) in which the plaintiff was injured was that he had failed to provide the plaintiff with any proper eye protection, such as a helmet designed for this sport, bearing in mind this sport’s particular risks. Issue: Was the non-provision of a helmet unreasonable in the circumstances? Decision: The High Court majority agreed with the trial judge, who held that it was not reasonable to require the defendant to provide helmets, as helmets had never been a form of protection worn by this sport’s participants. Relying on general practice to provide useful evidence as to what is reasonable, the trial judge’s reasoning was endorsed in Gleeson CJ’s judgment, where he noted (at [28]) how the non-provision of helmets ‘was not the result of indifference to considerations of safety. It resulted from aspects of the game which people might reasonably regard as making helmets

unsuitable, and in some circumstances, dangerous’. Providing this type of equipment was not held to be a reasonably practicable precaution.

The difficulties associated with demonstrating the kinds of practicable precautions that ought to have been taken in response to a risk were considered in the following case, a leading High Court of Australia authority most often cited for its exploration of when the state and a public authority may owe a duty of care (see Chapter 7). [page 141] Case Example Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; 194 ALR 337 Facts: See 7.14. An action was brought by consumers against the oysters’ producers and distributors (not just the state and local authority). Issue: What should the reasonable producers and distributors have done in response to the foreseeable risk of harm to consumers? Decision: The majority of the High Court of Australia held that the producers and distributors had not breached their duty of care to consumers. Even though the risk of harm was foreseeable (their knowledge met the common law test, ‘not far-fetched or fanciful’), the practicable alternatives open to the defendant companies were not viable: (i)

(ii) (iii)

ceasing harvesting and selling oysters after the 1996 rainfall until a sanitary survey was conducted and it revealed this was an acceptable risk (the testing was beyond their control); selling oysters with a warning about viral contamination; ceasing growing oysters in this area entirely.

Realistically, the first alleged option would have amounted to ceasing harvesting for an indefinite period. Gummow and Hayne JJ stated (at [201]–[202]): Each of the three courses of action would have been entirely destructive of, or highly disruptive to, the business of the Barclay companies. Each represents alleviating action of the most difficult, expensive and inconvenient type. According to the settled principles propounded in [Shirt] such alleviating action can only be required … if the magnitude of the risk and the degree of probability of its occurrence are great indeed. Although a risk of viral contamination was ever present, this was the first recorded outbreak of hepatitis A, or any other oyster-related disease, caused by

Wallis Lake oysters in almost a century of oyster growing. It was a bare possibility of a known risk which, until the 1996–97 season, had never eventuated. Hepatitis A is a serious and potentially lethal threat to public health. One person died as a result of the 1997 epidemic. Nonetheless, there was expert virologist evidence at trial that this epidemic was a very rare event in ‘world terms’, and one which resulted from an unusual and random sequence of environmental factors. Notwithstanding the significant magnitude of the risk of harm that eventuated … the degree of probability of its occurrence cannot be said to justify the difficult, expensive and inconvenient alleviating action contended for by the consumers.

Defendant’s personal capacity to take precautions: relevant or not? 3.53 In most circumstances it is not permissible to consider whether or not the particular defendant could have afforded to have taken the precautions required in the circumstances. If personal capacity were allowed to excuse the defendant’s behaviour, it would turn an objective test of reasonableness into a subjective one (see 3.2). For example, if you manufacture food products, and decide to clean your machinery every month or so, and someone suffers severe food poisoning because of the lack of cleanliness at your plant, the court will not allow you to excuse [page 142] your behaviour because you contend that you were unable to afford to clean your machinery. The court would, quite sensibly, chastise you for undertaking that activity. 3.54 Despite the general principle, there are a few relatively unusual sets of circumstances where the court will consider the actual burden on the defendant and whether or not she or he had the personal capacity to meet it. For example, if an occupier was not responsible for creating the risk of injury or damage but is nevertheless held to owe a duty of care (which was thrust upon her or him), she or he will be required to take precautions against that risk. However, the court can

take the imposition of this burden to act affirmatively into account when determining what constitutes reasonable precautions in the circumstances. That is what occurred in the following leading authority, in which the most contentious issue was whether or not a duty of care was owed, with respect to what was characterised as a pure omission. Indeed, finding the duty to act affirmatively was exceptional; it was found because of the defendant’s circumstances as occupier and neighbour. Having imposed this onerous affirmative duty to act on the defendant, the court then offered him what could be considered a concession in principle, permitting a subjective assessment of that person’s actual abilities and capacity. This is also reflected in the occupiers’ liability statutes, where the court is to take into account the subjective burden on the occupier, when it determines reasonableness (see 3.65). Key Case Goldman v Hargrave [1967] 1 AC 645 Facts: A tall redgum tree on the defendant’s land was struck by lightning, and a fire started in the tree high above the ground. It was impossible to put the fire out while the tree was standing. As no tree feller was available on the day the tree caught fire, the defendant cleared a space around the tree and sprayed the surrounding area with water. The day after the fire started, a tree feller was sent to the defendant’s land by the district fire control officer. By that time, the tree was burning fiercely. The feller cut the tree down. The defendant did not then take any steps to put the fire out with water, as he thought that the best method of extinguishing a fire of this kind was to let it burn itself out. Three days after the tree had been cut down, a strong wind blew up, and the temperature rose to about 40 degrees Celsius. The fire in the tree revived, and spread from the defendant’s land to neighbouring properties, causing extensive damage. The defendant’s neighbours sued the defendant. Issue: Was the property owner negligent in not taking steps to put out the fire after the tree had been cut down? Decision: On appeal from the High Court of Australia, in considering the standard of care expected of the defendant in these circumstances, Lord Wilberforce (delivering the opinion of the Privy Council) said (at 663): [page 143]

[T]he law must take account of the fact that the occupier … has, ex hypothesi, had this hazard thrust upon him through no seeking or fault of his own. His interest, and his resources, whether physical or material, may be of a very modest character either in relation to the magnitude of the hazard, or as compared with those of his threatened neighbour. A rule which required of him in such unsought circumstances in his neighbour’s interest a physical effort of which he is not capable, or an excessive expenditure of money would be unenforceable and unjust. One may say in general terms that the existence of a duty must be based upon knowledge of the hazard, ability to foresee the consequences of not checking or removing it, and the ability to abate it. Although the Privy Council modified the standard of care, it nevertheless held that the defendant in this case had failed to take reasonable care in the circumstances.

3.55 One must be careful not to take this passage from Goldman’s case out of context: the court will only take the actual defendant’s personal resources into account in cases where the defendant did not create the risk, but is nevertheless required to take precautions against it. Case Example PQ v Australian Red Cross Society [1992] 1 VR 19 Facts: The plaintiff, a haemophiliac, contracted HIV from transfusions of blood supplied from the defendant’s blood bank. The plaintiff sued the defendant. The defendant adduced evidence that it was a charitable organisation with scant resources, partly staffed by volunteers. Issue: Should the defendant’s actual resources be taken into account in assessing if it negligently failed to take adequate precautions to screen donated blood for the HIV virus? Decision: After considering Goldman v Hargrave, McGarvie J concluded that the court should not take the defendant’s actual resources into account in cases where the risk of injury was created by the defendant’s own activities. The defendant’s conduct was to be judged not in the light of its own resources, but against the standard of the reasonable person with adequate resources to engage in the activity in which it was engaged.

3.56 This issue also arises in cases involving government and public authorities as defendants. Courts are hesitant to find that these defendants acted unreasonably when their decisions are dictated by

resource constraints and the capacity to do certain things. Indeed, under the separation of powers doctrine, judicial scrutiny of this type of decision making could be considered [page 144] inappropriate. These issues are sometimes considered at the breach stage, with an assessment of the defendant’s capacity to act, or at the duty stage, employing the policy/operational dichotomy. The Civil Liability Acts enshrine the way in which constraints imposed by resource allocation should be addressed (see Chapter 7). 3.57 In Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd, Campbell JA of the New South Wales Court of Appeal observed (McColl JA agreeing; Sackville AJA agreeing with the order and most of the reasoning) (at [263]–[265]): If, when a private individual or corporation is carrying out some activity, taking reasonable care to avoid harm to people to whom a duty of care is owed would require expenditure to be made, but the particular individual cannot afford that expenditure, the poverty of the individual and significant conflicting responsibilities sometimes provide no escape from a finding of breach of duty if the individual nonetheless persists with the activity. For example, taking reasonable care for other motorists could require a car owner to spend money on the repair of his or her vehicle. If the money is not spent, and the individual continues to drive, and the lack of repair causes an accident, the individual cannot be heard to say even that his choice was between maintaining the vehicle and providing food or necessary medical attention for his family. The response of the law of negligence to that situation is ‘if you can’t afford to make your car safe to drive, don’t drive it.’ That is because the standard is judged by reference to what a reasonable car owner would do, and the hypothetical reasonable car owner is not someone who lacks the resources to make the sort of expenditure that is part and parcel of owning a car. The history of litigation about industrial safety conditions shows how failure to provide even costly equipment, systems, training or supervision for employees could be a failure to take reasonable care, because the reasonable employer in a particular line of business is not someone who lacks the resources to make the sort of expenditure that is involved in employing people to work in that line of business in conditions of reasonable safety. By contrast, it is not open to a statutory authority that has responsibility for administering some field of endeavour conferred on it by statute, to withdraw from that field if it lacks resources to carry out some particular activity that is within its

powers. It would ignore reality for a court to proceed on the basis that a statutory authority should be taken to have sufficient resources to carry out all its statutory duties, powers and discretions. An effect of this is that the standard by which one decides whether a statutory authority has acted negligently is not the same as that applicable to a private individual or corporation, but rather is the standard of what a reasonable authority, with its powers and resources, would have done in all the circumstances of the case …

This case is considered further, below. The court addressed a number of issues arising in a negligence claim against a statutory authority, which had a large number of responsibilities and limited resources. [page 145] Case Example Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd (2009) 168 LGERA 357; [2009] NSWCA 263 Facts: An employee of the respondent company was driving one of its trucks along the freeway south of Campbelltown (Sydney). A concrete block was dropped from an overhead bridge, killing him. The four persons responsible were convicted criminally. The respondent brought a negligence action against the Roads and Traffic Authority (RTA), seeking indemnification for compensation it paid to its employee’s family. It alleged that the RTA had breached its duty of care to road users by not fencing the overhead bridge, even though it knew that for some time objects had been dropped from bridges, injuring members of the public. Issues: Did the RTA owe a duty of care to prevent harm to road users in these circumstances? If it did owe a duty, had it been breached by (i) not installing barriers, screens or guards at the time of the bridge’s construction or (ii) not retro-fitting a barrier, screen or guard after there was increasing evidence of objects being thrown from bridges? Decision: The New South Wales Court of Appeal found in favour of the defendant, unanimously reversing the trial judgment. It discussed policy and operational distinctions and resource allocation at length. Although it held that a duty of care was owed, it found that the RTA acted reasonably in the circumstances, as the respondent had not proven that it had acted differently to a reasonable road authority. A great deal of evidence was considered, including engineers’ views, detail about budgetary approval processes and information about the number of incidents in which objects had been dropped from bridges at this and other locations (from 1992–98, there were 29 incidents in New South Wales, 24 in the Sydney region). Campbell JA (McColl JA

agreeing; Sackville AJA agreeing with the order and most of the reasoning) stated (at [186]): [I]t is always predictable that someone might drop an object from a bridge, and the possibility of that happening is not far-fetched or fanciful (or not insignificant, if section 5B(1) … imposes a test that is any different in substance …). However, before a roads authority is negligent for having failed to screen the bridge it must have failed to take a step that a reasonable roads authority would have taken. There is no basis for concluding that a reasonable roads authority in the 1975– 1978 period in Australia, would have fenced a bridge like the present one. The court held that the significance of the risk of a vehicle on a freeway being struck by a falling object had to be considered in the ‘context of the overall picture of accidents on NSW roads’ (at [201]). The only measure that could be taken was an impediment to people deliberately throwing objects off bridges, which could not completely eliminate the risk. To determine if a statutory authority had breached its duty, the authority’s competing priorities, budgetary or funding constraints and resources and powers must be taken into account. They concluded (at [308]): In the light of the nature of the risk, and of the other responsibilities of the RTA for expenditure of money available to it from the Federal government … I am unable to reach a conclusion that the RTA failed to take reasonable care in not having the Glenlee Bridge screened … [page 146] As was noted earlier (see 3.40) in a separate concurring judgment, Sackville AJA highlighted the need to satisfy the statutory requirements of the Civil Liability Act before finding negligence. He agreed with Campbell and McColl JJA that the trial judge had erred in finding that the defendant breached its duty by not installing protective screening when the bridge was built. With respect to the fact that no such screening was later installed over the course of several years, despite incidents of thrown objects causing injuries, Sackville AJA stated (at [444], [445]): While s 5B … incorporates concepts derived from the common law, the primary Judge was required by statute to satisfy himself that each of the matters specified in s 5B(1) was satisfied before he could find that the RTA had been negligent … [emphasis in original]. … These provisions required … a careful analysis of the RTA’s responsibilities to avoid other risks of harm to road users and to take account of the competing demands on the limited (if substantial) resources of the RTA. He continued (at [448]–[450]): There is no doubt that the risk of injury or death from activities of this kind was not only foreseeable but actually foreseen some time before the tragic incident … It was also foreseen that the Glenlee Bridge, along with many other overpasses,

presented a significant risk of injury to road users requiring attention from the RTA. The chances of injury or death occurring at any particular location, if preventative measures were not taken, were very low. But if harm did result from objects being thrown or falling onto the carriageway from an overpass, the harm was likely to be very serious. … [The statute] requires the Court to determine whether a reasonable person in the position of the RTA would have fenced the Glenlee Bridge notwithstanding competing claims on its resources to address similar risks of serious injury elsewhere. … [T]he Court needs to consider whether the RTA’s ordering of priorities was a departure from standards to be expected from a reasonable person in the RTA’s position. The Court should also take account of the opportunities reasonably available to the RTA to gain additional funding from the Commonwealth or other sources … … The RTA’s response to the risk, having regard to the burden of taking precautions to alleviate the risk of harm to all road users from similar sources, was not shown to be unreasonable. The RTA adopted a rational and apparently systematic (although not perfect) approach to assessing priorities for the erection of protective fencing on the basis of the magnitude of risk. It acted on that assessment within the limits of available resources.

Actions taken after the accident 3.58 It is often the case that a defendant takes precautions after an accident has happened. The accident persuades the defendant of something which a reasonable person already knew, namely that the risk of injury in the circumstances is a real one. It might be thought that if a defendant takes precautions after an accident, she or he thereby admits that she or he was negligent in not taking these precautions before the accident. As a matter of law, that is not so. The fact that the defendant has taken precautions after the accident in which the plaintiff was injured is not proof of negligence, but it is admissible as evidence that those precautions would have been reasonably practicable before the accident. [page 147] Case Example

Nelson v John Lysaght (Australia) Ltd (1975) 132 CLR 201; 5 ALR 289 Facts: The plaintiff slipped and injured himself while carrying a heavy coil of metal across a smooth steel ramp which was slippery with oil. The defendant, the plaintiff’s employer, had provided the plaintiff with protective clothing, including non-slip safety shoes. The plaintiff adduced evidence that, after the accident, the defendant had modified the system of moving the coils in a way that removed the risk of injury. Issue: What is the effect of the system modification after the accident? Decision: The High Court of Australia held that this evidence was admissible to establish the proposition that, at the time of the accident, there was a reasonably practicable precaution that would have guarded against the risk, namely the system of work that was subsequently adopted.

The same kind of evidence was admitted in Jellie v Commonwealth [1959] VR 72; Theilemann v Commonwealth [1982] VR 713; Ryan v Electricity Trust of South Australia (No 1) (1987) 47 SASR 220; and Western Suburbs Hospital v Currie (1987) 9 NSWLR 511. In O’Dwyer v Leo Buring Pty Ltd [1966] WAR 67, the inclusion of a warning label after the incident in which the plaintiff had been injured but before trial, was not an admission of liability; rather it amounted to evidence that the precaution — the warning — was practicable. 3.59 This common law position is reflected in legislation in the Australian Capital Territory, New South Wales, Queensland, Tasmania and Victoria, which state:25 … the subsequent taking of action that would (had the action been taken earlier) have avoided a risk of harm does not of itself give rise to or affect liability in respect of the risk and does not of itself constitute an admission of liability in connection with the risk.

The ‘social utility’ of the activity that creates the risk of harm (or ‘justifiability’): part of the ‘calculus’ 3.60 Another factor that may be taken into account in determining the appropriate standard of care is the social desirability of the defendant’s enterprise and conduct — its social utility — which can be a factor in determining the standard of care expected of the reasonable

person. This can arise where there is an emergency, as the next case highlights. [page 148] Case Example Watt v Hertfordshire County Council [1954] 1 WLR 835 Facts: The plaintiff, a fire officer, was injured by lifting gear in the back of a fire truck that was hurrying to an emergency where a woman lay trapped under a heavy vehicle. Although the truck was not fitted to carry lifting gear, it was being used in this case because it was the closest to the scene of the accident. Issue: Was the plaintiff’s employer, the defendant, negligent in requiring the plaintiff to ride in the back of the truck with the unsecured lifting gear? Decision: The Court of Appeal held in favour of the employer. Denning LJ said (at 838): It is well settled that in measuring due care you must balance the risk against the measures necessary to eliminate the risk. To that proposition there ought to be added this: you must balance the risk against the end to be achieved. If this accident had occurred in a commercial enterprise without any emergency there could be no doubt that the servant would succeed. But the commercial end to make profit is very different from the human end to save life or limb. The saving of life or limb justifies taking considerable risk.

Compare Patterson v McGinlay (1991) 55 SASR 258, where it was held that a police car driver had driven negligently, even though the standard of care was modified to take into account the fact that he was attending an emergency. Examples where the value of social utility has been explored explicitly in the course of assessing the defendant’s reasonableness are diverse. For example, in New South Wales v Bujdoso (2005) 222 ALR 663, the state’s objective to rehabilitate detainees was a form of social utility (see 3.49), and in St Mark’s Orthodox Coptic College v Abraham [2007] NSWCA 185, the social utility of developing a child’s

‘confidence and maturity’ was one of the factors the court considered in finding the father’s conduct to be reasonable (see 3.48). In Shaw v Thomas (see 3.36, 3.41), the New South Wales Court of Appeal stated (at [61]) that social utility was not of significance, because this was not the type of case where ‘some activities are more worth taking risks for than others’ (citing Waverley Council v Ferreira). However, it made a difference in Hoffman v Boland [2013] NSWCA 158, where a five-month-old infant sustained major injuries when her grandmother fell down the stairs at night while carrying her. While there were differences of opinion as to whether or not a grandmother owed a duty of care to her grandchild, with respect to ordinary day-today care of the child (see 6.7), on the question of breach, the court unanimously held in favour of the grandmother. Reversing the trial judge, Sackville AJA (Basten and Barrett JJA agreeing) held (at [138]) that the grandmother’s act of taking control of the crying child and offering temporary relief to the child’s mother had a ‘very high social utility: it goes to the very heart of what family members do for each other’. In the circumstances, the defendant had taken sensible and appropriate precautions to guard against a fall on the staircase while she carried the baby. [page 149] The New South Wales Court of Appeal held in favour of a 40-yearold barrister who was injured during personal training using a medicine ball, under the instruction of a 20-year-old, recently qualified fitness trainer in Wilson v Nilepac Pty Ltd t/as Vision Personal Training (Crows Nest) [2011] NSWCA 63. The trial judge found no breach, given the social utility of exercise. Allowing the appeal, Tobias JA stated (Beazley JA agreeing) (at [125]) that ‘a reasonably competent professional fitness trainer … would not have engaged the appellant in the medicine ball exercise’ (as a practicable precaution). Further (at [129]), he stated that the Act requires consideration of ‘social utility of “the activity that creates the risk of harm” … that activity was the

medicine ball exercise. Of itself it had no relevant social utility let alone a high social utility’. It is not adequate to state, in terms too broad, that physical activity per se has social utility. Bader v Jelic [2011] NSWCA 255 involved a worker who stumbled on a rug and fell through a glass panel window, suffering physical injuries. He sued the occupier for failing to cover the window and preventing the fall. The New South Wales Court of Appeal (Macfarlan JA, with Young JA and Sackville AJA agreeing) held that the worker had not established that a reasonable person would have pulled the blind down over the window to prevent the risk of a person falling through. Interpreting social utility broadly, Macfarlan JA stated (at [40]) that there is social utility in ‘having the window, and the view beyond, unobscured by a blind … [as this would be] … preferable from an aesthetic point of view to a cloaking of the window’. In Southern Properties (WA) Pty Ltd v Executive Director of the Department of Conservation and Land Management (2012) 42 WAR 287; 189 LGERA 359; [2012] WASCA 79, winery grape crops were damaged by smoke, arising from a burning-off activity undertaken by the Department of Conservation and Land Management under its statutory duty to manage the land. The primary focus of the case involved public authorities’ duty of care (see 7.19). On this point, the majority of the Western Australia Court of Appeal held that no specific duty was owed by the Department to avoid reasonably foreseeable risk of harm to the grape crops in carrying out statutory powers and duties, as the purpose of the burning was to reduce likelihood of destructive wildfires; this duty was owed to the wider community. According to McLure P (Buss JA agreeing) (at [107]), to find such a duty to the grape growers would conflict with the ‘statutory functions in the best interests of the community as a whole’. Dissenting, Pullin JA found a duty and breach. On the latter point, he observed that considerations of social utility in the calculus of negligence have been broadened by civil liability legislation. Referring to recent cases such as Bader v Jelic, his Honour noted (at [257]), ‘[i]n some cases judges have felt obliged by the section [of the Civil Liability Act 2002 (WA) (CLA)] to consider social utility in circumstances where in cases not governed by the CLA,

the social utility of the activity would not have rated a mention’. In Pullin JA’s view (at [265]), ‘the social utility of prescribed burning should not be given significant weight in determining, under s 5B(2), what precautions a reasonable person would have taken’. McLure P (Buss JA agreeing) deferred to legislative intent in a case involving a public authority, stating (at [112]), ‘[i]n this case, “social utility” … is not a matter on [page 150] which the court is free to form and act upon its own personal assessment of the reasonableness of the statutory objectives and purposes’. The importance of social utility in an environmental context arose in the following case. Case Example Rhodes v Lake Macquarie City Council [2010] Aust Torts Reports ¶82-073; [2010] NSWCA 235 Facts: A branch fell from a large gum tree that overhung the plaintiff’s house’s driveway, injuring her. On a number of occasions, she (and her neighbour) had complained to the council that the tree should be removed because it was dangerous, and branches were dropping on the house she occupied (owned by the Housing Corporation). Previously, her daughter had been struck by a branch. The Housing Corporation, which also owned the neighbouring property on which the tree was located, requested that the tree be removed. The council refused, because the tree was in a ‘sound and stable condition’. (It had inspected and trimmed the tree.) The occupier sued the council and the Housing Corporation. She argued that the latter should have more fully informed the council of all previous incidents involving the tree. Issues: Was the council negligent because it did not remove the tree? Should the Housing Corporation be liable for not providing more information to the council? Decision: The New South Wales Court of Appeal held that the council was not negligent, because, even though the risk from this healthy tree was not insignificant, the risk of substantial damage had a low probability. Further, native trees have a ‘social utility’. This is particularly so in the context of a general policy adopted by the council to retain native trees. Therefore, it was not unreasonable to try to maintain this tree. The court also held that the Housing Corporation had not used reasonable care to make

sure the council had all the information it needed to make its removal decision. However, this did not cause the injury, as the plaintiff had not proven that this additional information would have made a difference to how the council would have acted. The risk posed by this healthy tree was no different than that posed by many trees, on many properties, frequented by a large number of persons. On the evidence, there was nothing to suggest the council would have done more than prune the tree, even with more information.

Conflicting responsibilities (or justifiability): part of the ‘calculus’ 3.61 In Shirt, Mason J stated that an assessment of the reasonable response to a foreseeable risk also embraced ‘conflicting responsibilities’ that are faced by the defendant. This was at issue in New South Wales v Fahy (see 3.39), where a claim was brought by an officer against her employer, the police service, for psychiatric injury she suffered as a result of responding to an emergency. Holding against the officer, Gummow and Hayne JJ stated (at [72]): The response that Shirt requires a court to identify when considering breach of duty is a response which must have regard, in this case, to the responsibilities

[page 151] cast on the Police Service and on individual police officers. They are the ‘other conflicting responsibilities’ of which Mason J spoke in Shirt and which were to be taken into account in identifying the reasonable response to the risk. In particular, obedience to lawful orders, and the carrying out of lawful duties, is of primary and determinative significance.

In Roman Catholic Church Trustees for the Diocese of Canberra and Goulburn v Hadba (see 3.47), conflicting responsibilities favoured the defendant’s argument that its playground supervision system at recess was reasonable, as did the objective of developing trust and a sense of responsibility among the students. The need to have regard to the many different responsibilities faced by government or statutory bodies as defendants was considered in

Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd (see 3.57).

‘Soft factors’ 3.62 In Romeo v Conservation Commission of the Northern Territory (see 3.46), Kirby J considered the negative effects on the environment if fencing were required — a factor that is aesthetic in nature (at [130]). While not formally part of the ‘calculus of negligence’, value-laden factors such as environmental impact have been referred to on occasion, as ‘soft factors’ affecting the standard of care: see, for example, Western Suburbs Hospital v Currie (1987) 9 NSWLR 511 at 523, per McHugh JA, when he was on the New South Wales Court of Appeal. As was noted earlier, the impact on the environment also has been considered in the social utility context: Rhodes v Lake Macquarie City Council (see 3.60). See also Bader v Jelic, where the court discusses aesthetic considerations as part of social utility. It could also perhaps be said to be a ‘soft factor’ (see 3.60). Another example of concern for the environment was expressed in Graham v Welch [2012] QCA 282, where the court noted (at [24]), that ‘[t]rees and bushes are commonplace and desirable attributes of homes in residential areas’ and there is ‘aesthetic and ecological desirability of trees in suburban gardens’ (see 3.66). The plaintiff, the 76-year-old aunt of the defendant occupier, slipped and fell on steps on which a gum nut had fallen from a gum tree in her niece’s garden.

Additional Standard of Care/Breach Issues ‘Obvious risk’ in the standard of care context at common law 3.63 Issues associated with ‘obvious risks’ have become increasingly prevalent (and somewhat confusing) both at common law and in legislative enactments. The previous discussion of risks that may be

ignored may also be relevant: see 3.37. The judicial trend in which obvious risk has been highlighted is intertwined with an emphasis on ‘personal responsibility’. Indeed, it is likely that a case like Nagle v Rottnest Island Authority (see 3.33) would be decided differently today, having regard to a number of High Court pronouncements subsequent to that case. Many years after the decision in Nagle, a very differently constituted High Court decided two significant diving cases, involving breach determinations. In both [page 152] cases, handed down the same day, the court held against the plaintiffs: a four to three decision in Vairy v Wyong Shire Council and unanimously in Mulligan v Coffs Harbour City Council. The judges who dissented in Vairy but were part of the majority in Mulligan reached conclusions on breach, based on their application of the Shirt approach to the two cases’ disparate material facts. Members of the court asserted differing views with respect to the role ‘the obviousness of the risk’ should play in an assessment of liability. The majority reasoned that ‘obviousness of the risk’ should be firmly placed within a breach assessment (or perhaps contributory negligence) and not be part of a duty analysis (as is sometimes suggested): it is one of several factors going to the assessment of breach. Others elevated its significance. As Barbara McDonald argues in a comprehensive article discussing these and related issues, ‘its place is within the negligence calculus’.26 Key Case Vairy v Wyong Shire Council (2005) 223 CLR 422; 221 ALR 711 Facts: The plaintiff was rendered a tetraplegic when he dived into the sea from a flat rock platform near a beach. That day, others had been diving into the water without incident. However, in the past, there had been injuries to divers at the same place. He sued the local government authority responsible for the beach and rock platform.

Issue: Was the council negligent for failing to erect a sign prohibiting or warning of the risks of diving from the rock platform? At common law, what is the effect of characterising some risks as ‘obvious’? Decision: The plaintiff succeeded at trial, where he was found to be 25 per cent contributorily negligent: damages of $5,054,753.25 were awarded. On appeal to the High Court, the divided court found the council had not breached its duty. While the majority (Gummow, Hayne, Callinan and Heydon JJ) found that the risk of injury was foreseeable, it concluded that the council had not breached its duty by not erecting a warning sign. The majority attached less weight to a previous accident and the nature of the risk at this particular locale than did the dissenting judges. Hayne J reasoned (at [158]–[161]): Every form of physical recreation carries some risk of physical injury. The more energetic the activity, the greater are those risks. Fatigue, lack of fitness, slowness of reaction, general ineptitude can all contribute to injury. … … The form of danger with which this case is concerned — the danger of diving into water that is too shallow — is only one of the risks that attend this form of recreation. And the council had to consider many forms of recreation conducted in many different areas of which the council had the care, control and management. … [page 153] It was not reasonable to expect the council to warn of this particular danger. The council had done nothing to make the danger worse and had no knowledge of some feature of this particular area that was not readily discovered by someone contemplating diving or plunging into the water at this point. Hayne J cautioned against using hindsight when assessing a reasonable response to a reasonably foreseeable risk (at [105]): Resolving that question [erecting a sign], a question of fact, hinges critically upon recognising that what has come to be known as the ‘Shirt calculus’ is not to be undertaken by looking back at what has in fact happened, but by looking forward from a time before the occurrence of the injury giving rise to the claim. … Gleeson CJ, McHugh and Kirby JJ dissented, finding that the failure to erect a warning or prohibition sign was an unreasonable response to the risk. Commenting on a common tendency to misuse authority, they stated (at [2]–[3]): The central question concerns the reasonableness of the defendant’s behaviour. … [D]ecided cases in this area are fact-sensitive, and it is a sterile exercise, involving a misuse of precedent, to seek the solution to one case in decisions on the facts in other cases. The proper use of precedent is to identify the legal principles to apply to facts as found. Decided cases may give guidance in identifying the issues to be resolved,

and the correct legal approach to the resolution of those issues. But a conclusion that reasonableness required a warning sign of a certain kind in one place is not authority for a conclusion about the need for a similar warning sign in another place. … Nagle v Rottnest Island Authority did not establish that reasonableness requires a warning sign in all places where there are submerged rocks, any more than … Romeo v Conservation Commission (NT) established that reasonableness never requires a warning sign at the top of a cliff. They continued (at [8]): It is impossible to state comprehensively, or by a single formula, the circumstances in which reasonableness requires a warning. The question is not answered by comparing the cost of a warning sign with the seriousness of possible harm to an injured person. Often, the answer will be influenced by the obviousness of the danger, the expectation that persons will take reasonable care for their own safety, and a consideration of the range of hazards naturally involved in recreational pursuits. McHugh J held that the council was obliged to erect a warning sign as a reasonable response to a known risk, because, as far back as 1978, another diver used the platform, struck the ocean bed and became tetraplegic. Its general manager knew where and how this had happened; this was common knowledge within the council. With respect to the importance of an ‘obvious risk’ finding, Gummow J cited Hayne J (at [55]): ‘[R]eference to a risk being “obvious” cannot be used as a concept necessarily determinative of questions of breach of duty or … the existence and content of duty itself.’ Hayne J elaborated (at [162]–[163]): Reference to a risk being ‘obvious’ is apt to mislead and cannot be used as a concept determinative of questions of breach of duty. … That is not to deny the importance of considering the probability of occurrence of the risk in question. The probability of occurrence of a risk that is not apparent on casual observation of a locality or of a set of circumstances may be higher than the probability [page 154] of occurrence of a risk that is readily apparent to even the casual observer. But the focus of inquiry must remain upon the putative tortfeasor, not upon the person who has been injured, and not upon others who may avoid injury. And in looking at the reasonable response to a foreseeable risk it is necessary to recall that there will be times when others do not act carefully or prudently. By way of contrast, Callinan and Heydon JJ, in a minority view, tried to elevate the ‘obviousness’ factor, referring to their own comments in Mulligan (at [75]) (see below): ‘[O]bviousness may be of such significance and importance, indeed of such a very high

degree of importance as to be overwhelmingly so, and effectively conclusive in some cases.’ They further stated in Vairy (at [217]): [D]espite their allure, the sea waters of Australia, notoriously, are far from benign. Depending on how far north the traveller goes, sea lice, flotsam and jetsam, weed, blue bottles, stingers, quicksand, sea snakes, crocodiles, unpredictable waves, sand bars, sharks, absence of effective netting, shifting sea beds, broken bottles on the beach or in the water, sunstroke from sun bathing, and unpredictable tides and currents constitute a non-exhaustive catalogue of the risks a bather runs. Indeed, swimming itself, without more, can be hazardous. … But the point in particular that we wish to make here is simply that the respondent could reasonably expect that a person of the appellant’s age, knowledge and experience would not need a warning that to dive from the platform could be a dangerous thing to do. … Again, as Callinan J pointed out in [Agar v Hyde (2000) 201 CLR 552; 173 ALR 665 at [127]] places of recreation are not places to which people are compelled to resort, and nor are they obliged, if they do, to participate in physical activities there. To date, the views of Callinan and Heydon JJ on the supposedly determinative nature of ‘obviousness’ are not those held by a majority of the High Court of Australia.

Key Case Mulligan v Coffs Harbour City Council (2005) 223 CLR 486; 221 ALR 764 Facts: The plaintiff, on holiday in Australia, visited a tourist attraction at Coffs Creek. The council had altered the creek’s configuration to create a pool of sheltered water for swimming, promoting the pool to tourists. It was common to jump and dive into this fast flowing water and ‘ride’ the water to the beach. Having observed others riding the water, the plaintiff did so himself, for about 30–60 minutes. Each time, he waded out until the water reached his mid-thigh, then felt a sharp drop in the creek bed gradient. He then made several shallow dives into the water. On the last occasion his head hit an elevated sand dune or bedform; he suffered serious injury. He knew the water depth varied and that it was risky to dive into water of variable depth. Issue: Was the council negligent for failing to erect a warning sign? Decision: The High Court unanimously rejected his claim. Gleeson CJ and Kirby J explained (at [2]) that their conclusion, different to Vairy, was based on the circumstances: In Vairy … there were clear reasons why the public authority would choose to single out the elevated rock platform. … Fifteen years before Mr Vairy’s injury a similar accident

[page 155] had occurred. … Contemporaneous reports had indicated a beach inspector’s recommendation that a sign be placed in position. Yet it was not … No such features were present in the facts of Mr Mulligan’s case. McHugh J agreed, noting that there was nothing in Mulligan, factually, that suggested the dangers were different from those that any swimmer faced, when diving forward in a river or creek. In their separate judgment, Callinan and Heydon JJ chastised those who ignored the defendant’s plight in these types of cases (at [80]): The imperialism of the law of torts has had many beneficial products. Employers, governments, statutory authorities and others have been forced to exercise their minds in the interests of those who may be injured by their conduct and to improve performance accordingly. Even empires must however have their borders and equally, society should be entitled to expect that people will take elementary precautions at least for their own safety against obvious risks. … It is only reasonably to be expected that people will conduct themselves according to dictates of common sense, which must include the observation of, and an appropriately careful response to what is obvious. Courts in deciding whether that response has been made are bound to keep in mind that defendants have rights and interests too. A tendency to see cases through the eyes of plaintiffs only is to be avoided.

In Woods v Multi-Sport Holdings Pty Ltd (see 3.14, 3.52), according to Gleeson CJ (at [33] citing the trial judge) and Hayne J (at [144]), reasonable care did not require warning an indoor cricket player that she or he could be struck in the face by a cricket ball — this risk was ‘evident to all participants’. Applying the majority opinion in Vairy, the court in Marsden v Ydalia Holdings (WA) Pty Ltd (2006) Aust Torts Reports ¶81-840; [2006] WASCA 52 held that ‘obviousness’ was relevant to considering the reasonable response to a risk. The majority held (at 68,468; [112]), ‘the sign in question here reminded cyclists of the need to avoid the obvious risk of injury by taking the precaution of dismounting and walking’. Another case arising in the Vairy and Mulligan context, also determined by the High Court of Australia in 2005, is Swain v Waverley Municipal Council (2005) 220 CLR 517; 213 ALR 249. It too involved a

swimmer, this time at Bondi Beach, who became a quadriplegic after diving through a wave and striking a sandbar. He sued the council for carelessly placing and maintaining flags on the beach. The jury decision in his favour was set aside by the New South Wales Court of Appeal. The High Court emphasised the need to focus on the central concept underlying negligence cases, reasonableness, and the standard of conduct expected of the reasonable person in the circumstances to discharge the relevant duty of care. Here, the majority held in the plaintiff’s favour, on technical grounds: according to the court, the jury’s verdict must stand, as it was reasonably open to it on the evidence presented to make a finding of ‘unreasonableness’ against the council (regardless of whether or not appeal court judges agreed with that assessment). 3.64 Several cases, like Swain, have canvassed the appellate court’s role and when it is permissible for it to reverse a lower court’s or jury’s negligence findings. See, [page 156] for example, Anikin v Sierra (2004) 211 ALR 621 and Fox v Percy (2003) 214 CLR 118; 197 ALR 201, where the High Court of Australia considered a number of fact-finding issues, including the credibility of witness evidence in the context of trials with judges sitting alone as opposed to those with juries. Waterways Authority v Fitzgibbon (2005) 221 ALR 402 also addressed witness credibility, the alleged insufficiency of the trial judge’s reasoning and whether the appeal court had correctly decided a factual issue. Commissioner of Main Roads v Jones (2005) 215 ALR 418 addressed issues concerning warnings, credibility, the risk of hindsight bias and the appropriateness of interfering with the trial judge’s findings when establishing causation. Yet another ‘jumping’ (or diving) case had a notable legacy. In Borland v Makauskas [2000] QCA 521, a young man became a tetraplegic by diving from a fence above a deck on the defendant’s

property, into the canal, while inebriated. The plaintiff was familiar with the property, as it belonged to his friend’s parents, and he had frequently visited the home. On the day of the accident, the plaintiff had consumed a large amount of alcohol, with several friends. The jury had held in his favour; it also found him to be 30 per cent contributorily negligent. On appeal, the Queensland Court of Appeal held that the risk was ‘blindingly obvious’ and ‘foolhardy in the extreme’ and ‘it would be unreasonable to expect a householder to take steps to avoid all possible forms of outrageous behaviour on the part of an entrant’ (at [15]). It found the jury’s verdict on these facts ‘unsustainable’. The Queensland Government threatened to abolish jury trials for personal injury claims in negligence had the jury verdict withstood the appeal process. Indeed, even though the verdict was overturned on appeal, Queensland subsequently excluded jury trials with respect to personal injury claims: see Civil Liability Act 2003 (Qld) s 73.

‘Occupiers’ liability’ 3.65 Several cases noted in this chapter involve reasonable responses to risks that arose in the context of ‘occupiers’ liability’. Four jurisdictions have enacted statutes specifically addressing this type of claim.27 In essence, these Acts direct courts to apply standard of care factors typically used in the tort of negligence (such as the ‘gravity and likelihood of the probable injury’) when assessing an occupier’s reasonableness. The Acts add factors that are specifically relevant to the context of occupation. These include: •

the circumstances of the injured person’s entry onto the premises;

•

the age of the entrant;

•

the knowledge the occupier has or should have about the likelihood of people or property being on the premises;

•

the burden on the occupier of removing the danger. [page 157]

The statutes generally reflect the common law position established in Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479; 69 ALR 615, in which the High Court of Australia abrogated often unworkable common law doctrine. These anachronistic common law principles required the application of rigidly defined and varying standards of care to particular kinds of occupier–entrant relationships; for example, a visitor to a home was necessarily owed a lower standard of care than a visitor to a department store. This is no longer the common law nor statutory position, where reasonableness is the governing criterion. 3.66 Some of these cases involve occupier situations where the risks could be ignored or may be ‘obvious’. At common law, reasonableness in this context was canvassed by the High Court of Australia in Neindorf v Junkovic (2005) 222 ALR 631; (2006) Aust Torts Reports ¶81120, where the defendant held a garage sale at the house she occupied and owned and the plaintiff, a visitor, walked along the driveway towards a table under the carport, tripped and fell on an uneven surface. The court emphasised that practical realities must be considered when assessing reasonableness, including the fact that people live in premises that are not free of hazards or risk and entrants come onto premises for a variety of reasons and circumstances. In a six to one decision (Kirby J dissenting), the court held that, as a question of fact, doing nothing was a reasonable response in the circumstances, as the surface’s unevenness was so ordinary and visible. With respect to these types of issues, recall cases such as Phillis v Daly (1988) 15 NSWLR 65 (see 3.37). Additional examples include the following: •

Shaw v Thomas (see 3.36, 3.41, 3.46, 3.60): the occupiers were not liable for not installing a guard-rail or ladder to a bunk bed.

•

Boyded Industries Pty Ltd (t/as Boyded Parramatta) v Canuto [2004] NSWCA 256: a car dealership employee sat on a glass table which fractured. Stein AJA (agreeing with Santow JA) stated (at [67]), ‘[p]lain common sense tells us that you do not sit upon glass topped tables such as this’.

•

Talbot-Price v Jacobs [2008] NSWCA 189: a ladder (allegedly) slipped or gave way as a tenant descended from the loft in leased premises. It was sufficient in the circumstances for the lessor to have directed the tenant to not use the loft; there was no need to construct a staircase or another means of safe access to it.

•

University of Wollongong v Mitchell (2003) Aust Torts Reports ¶81708; [2003] NSWCA 94: a theatre occupier was sued by someone who attended a graduation ceremony, rose from her seat to take a photo, then fell to the ground because the seat had automatically retracted. Meagher JA noted (at 64,225; [4]) that ‘[t]his is hardly a novel phenomenon’. The court held the danger was ‘glaringly obvious’, such that the reasonable defendant in the circumstances need not have posted a warning sign.

•

Graham v Welch [2012] QCA 282 (see 3.62): the 76-year-old aunt of the defendant occupier slipped and fell on steps; a gum nut had fallen from a gum tree in her niece’s garden. Her claim failed because it is common to find gum nuts, stones, [page 158] pods and similarly shaped objects on steps in suburban premises, especially in bushland. The occupier was not required to take action to remove all risks.

•

Sibraa v Brown [2012] NSWCA 328: the plaintiff, barefoot and in the dark, tripped over some welded wire mesh that was on her neighbour’s front lawn; she was visiting his children. The court concluded (at [43]) that it was foreseeable that ‘domestic premises in a town could be visited by a variety of people’ and that the risk of injuries, from encountering and tripping over the mesh was more than insignificant. However, breach was not established, as the occupier had not acted unreasonably by leaving the mesh where it was. Campbell JA (with Hoeben JA and Tobias AJA agreeing) observed (at [75]): ‘It would be quite a surprise to many

householders to be told that reasonable behaviour requires them to clear all obstacles from their lawns before nightfall.’ •

Department of Housing and Works v Smith (No 2) (2010) 265 ALR 490 (see 3.35): an elderly long-term tenant of an accommodation unit for seniors (one of 16 such units on the property) fell when her foot became lodged in a small depression on the lawn, caused by the removal of a birdbath by another tenant, who had moved. The Western Australia Court of Appeal held that this was not the kind of risk that required the reasonable person’s attention, under both the Civil Liability Act 2002 and at common law. Buss JA stated that this ‘minor risk’ was one that was part of ‘ordinary daily activities’ with which people (including those over aged 55) must cope. Having considered the interaction of Western Australia’s Civil Liability Act, Occupiers’ Liability Act 1985 and the common law, Pullin and Newnes JJA noted (at [20]) that ‘both parties were in agreement that there would be no different result whether the common law or the [Civil Liability Act (or the Occupiers’ Liability Act)] was applied’. Buss JA stated (at [85]) that there was ‘no relevant inconsistency’ when applied to these facts.

•

Drew v New South Wales [2015] NSWCA 159: the appellant injured her knee when she fell over a box left in a classroom she was cleaning. She alleged that the respondent was liable, as occupier of the premises. The New South Wales Court of Appeal (McColl, Ward and Leeming JJA) noted difficulties posed for the appellant by Phillis v Daly (1988) 15 NSWLR 65; the court also cited Neindorf v Junkovic (2005) 222 ALR 631; (2006) Aust Torts Reports ¶81-120. Their Honours held (at [38]–[39]) that there are many dangers on premises, including obvious tripping hazards, for which the probability of harm occurring is so low that a reasonable person need not take precautions to remove them. Their Honours stated (at [42]): ‘An occupier is generally entitled to expect entrants to exercise reasonable care for their own safety, particularly where risks of harm are obvious or apparent.’ The court further noted (at [42]) that ‘properly’, the appellant had conceded this point in her submission.

3.67 The following frequently cited case considered the issue of ‘obvious risk’ in the context of an occupier, but in circumstances not involving recreational activities or residential premises. The High Court of Australia again refused to elevate the obviousness of the risk to a separate legal doctrine having conclusive effect. [page 159] Key Case Thompson v Woolworths (Qld) Pty Ltd (2005) 221 CLR 234; 214 ALR 452 Facts: Every morning between 5:00 am and 5:30 am, the plaintiff drove a truck to deliver bread to the loading dock at the end of the laneway leading to the defendant’s store. Although the defendant’s storeman was supposed to assist with the delivery process set up by the store, those delivering goods often had to wait 10–15 minutes for him to arrive from his other duties, to allow the delivery to proceed. One of his duties involved removing large emptied industrial waste bins from the laneway. On many occasions the bins were not removed, blocking access to the loading dock. So, to save time, drivers often moved the bins to clear the path to the loading dock. For some time, the plaintiff and her husband had complained to the store’s management about this obstruction. The plaintiff injured her back, attempting to move one of the empty waste bins left in front of the loading dock. Issue: Would a reasonable defendant have eliminated manual handling of the bins and introduced a system of procedural controls to prevent the materialisation of the type of harm suffered by the plaintiff? Decision: The Court of Appeal reversed the trial judge, finding no evidence to support the breach finding. The High Court unanimously reversed the Court of Appeal, by first confirming that this occupier clearly owed the plaintiff a duty to take care, noting that this was not simply a case involving the physical or static condition of the premises but also the delivery system it had implemented. It stated (at [26]): ‘The purpose for which, and the circumstances in which, the appellant was on the respondent’s land, constituted a significant aspect of the relationship between them.’ The plaintiff was subject to a delivery system established by the store, including when to arrive and where to unload. The court stated (at [27]): [T]he respondent established and maintained a system, and its obligation to exercise reasonable care for the safety of people who came onto its premises extended to exercising reasonable care that its system did not expose those who made deliveries to unreasonable risk of physical injury.

The key issue, breach, involved the system in use, in which the risk of drivers moving the bins (and suffering injury) became so tempting. Hoping to save time, many risked their own safety. The court commented on the ‘obviousness’ of this risk (at [36]): The obviousness of a risk, and the remoteness of the likelihood that other people will fail to observe and avoid it, are often factors relevant to a judgment about what reasonableness requires as a response. In the case of some risks, reasonableness may require no response. The court continued (at [37]): The factual judgment involved in a decision of what is reasonably to be expected of a person who owes a duty of care to another involves an interplay of considerations. The weight to be given to any one of them is likely to vary according to circumstances. If the obviousness of a risk, and the reasonableness of an expectation that other people will take care for their own safety, were conclusive against liability in every case, there would be little room for a doctrine of contributory negligence. On the other hand, if those considerations were irrelevant, community standards of reasonable behaviour would require radical alteration. [page 160] The court concluded that there was no sufficient reason to reverse the trial judgment. The defendant had the responsibility and power to set up a proper delivery system and had not done so; delivery persons had no such responsibility or power. Having regard to the plaintiff’s own conduct, the contributory negligence finding of one-third was upheld.

Obvious risk under the Acts: onus of proof and the volenti defence 3.68 Situations involving ‘obvious risks’ have been the subject of specific legislative changes to the common law in several jurisdictions. They are intended to reduce findings of liability, discourage potential claimants from instituting proceedings and encourage personal responsibility for harm suffered. They relate to the voluntary assumption of risk defence, which is explored in detail in Chapter 11. At their core, they relax aspects of this defence’s strict onus of proof requirements. As we have seen, at common law, whether or not a risk is ‘obvious’ is part of the breach analysis; however, as we have noted,

the High Court has emphasised that it is not determinative of the breach assessment.

Intoxication and illegality: under some statutes 3.69 Two specific types of conduct — the intoxication and illegality of injured persons (plaintiffs) — have been subjected to wide-ranging legislative activity in the civil liability context. Like ‘obvious risk’, intoxication and illegality straddle different elements of the tort of negligence. Indeed, every jurisdiction has its own view with respect to how to legally respond to the injured person’s intoxication and illegality. Because most jurisdictions treat these types of conduct as defences they are considered in detail in Chapter 10 and Chapter 11 as one of the following: •

an aspect of contributory negligence (generally the most common response to the plaintiff’s intoxication);

•

a version of voluntary assumption of risk;

•

a separate defence under a statute (for example, generally the most common response to the plaintiff’s illegality, whereby the claim could be barred, assuming the terms of the relevant provision(s) are met).

For present purposes, the extent to which legislatures have made the plaintiff’s intoxication and/or illegal conduct part of the breach inquiry will be noted. 3.70 In rather elaborate provisions that seem to be a response to cases like Romeo v Conservation Commission of the Northern Territory (see 3.46) two states — New South Wales and Queensland — provide that a person’s intoxication is not relevant to whether or not the person is owed a duty of care (and the person is exposed to increased risk because her or his capacity to exercise reasonable care and skill is impaired due to being intoxicated).28 Further, the fact that a person is [page 161]

or may be intoxicated does not in and of itself increase (or otherwise affect) the standard of care owed.29 Victoria’s Wrongs Act 1958 (Vic) ss 14B(4)(fa), (fb), 14F–14G limit the consideration of intoxication and illegal conduct on the part of the injured person to matters relevant to breach. The Act provides that in occupiers’ liability cases, in determining whether the occupier has discharged her or his duty of care, consideration shall be given to whether or not the injured person was under the influence of alcohol or drugs (consumed voluntarily) as well as the level of that person’s intoxication. Consideration also shall be given to whether the injured person was engaged in an illegal activity when entering the premises. Importantly, the Act addresses circumstances well beyond occupiers’ liability cases, requiring courts to consider the plaintiff’s intoxication and/or illegality in every case where this type of conduct is a factor. Perhaps most noteworthy is the fact that these provisions do not go so far as to exclude or preclude the injured person’s recovery. They simply state that these factors must be considered. Arguably, this was always the case under common law principles, perhaps under the guise of contributory negligence, or ‘no breach’ findings. As was the case with the general approach of the Victorian legislature to changing the common law as a result of the Ipp Panel’s recommendations, the Victorian provisions addressing the plaintiff’s illegality and intoxication appear to be remarkably moderate and tame when compared to other jurisdictions, such as New South Wales and Queensland, where, generally, presumptions are invoked which dramatically affect injured persons’ potential recovery if they were intoxicated or acting illegally when injured. Significantly, Victoria’s moderate approach has withstood the generally harsher legislative trends experienced elsewhere. However, it is worth noting that even in Victoria, it is possible that on the particular facts of a case, the court may decide that the plaintiff’s intoxication or illegality is so troubling or significant that it does not find the defendant in breach. In those circumstances, the result for the plaintiff would in fact be as harsh as that yielded in New South Wales, for example, as the claim would fail

at that point; the plaintiff’s conduct would not be subject to a contributory negligence assessment, where damages likely would be apportioned rather than denied entirely.

Inherent risks and breach 3.71 Several Civil Liability Acts30 prescribe that liability in negligence is to be denied in cases involving the materialisation of an ‘inherent risk’. An ‘inherent risk’ is ‘a risk of something occurring that cannot be avoided by the exercise of reasonable care and skill’. This provision essentially excludes liability because there is no breach. However, importantly, it does not exclude liability to warn of an inherent risk. By way of example, riding a bull at a rodeo and injuring oneself by falling off and getting trampled — an obvious risk — could also be an inherent risk, as this type [page 162] of injury could not (presumably) be avoided by the exercise of reasonable care. The rodeo organisers could, however, be potentially liable for not warning of the risk of harm associated with riding a bull. Another example could involve an adventure sport like bungee jumping: the fact that one might suffer a back injury is an obvious risk of bungee jumping; it is also, arguably, an inherent risk, as the risk of harm could not be avoided by the exercise of reasonable care (unless perhaps one had been strapped into the harness incorrectly). Once again, there could be a breach for not warning of the possibility of this harm occurring. To complicate matters somewhat in this context, it is clear that the risk of suffering potential eye trauma is an ‘inherent risk’ of bungee jumping. However, it could be argued that this is not necessarily an ‘obvious risk’, according to the Acts’ definitions (see 11.21). To use a different and rather graphic example in the medical

context, perforation of the bowel is an inherent risk of a colonoscopy, a medical procedure commonly used to detect the presence of polyps which can lead to bowel cancer. Because perforations and bleeding can materialise even though reasonable care is taken, liability would be excluded. A doctor could, nevertheless, potentially be held liable for not warning of this risk. More generally, in many medical procedures, the risk of infection might be characterised as a matter inherent to the treatment. Recall that statutory provisions addressing professionals would apply in a number of jurisdictions (see 3.21–3.27). In Cox v Fellows [2013] NSWCA 206, the New South Wales Court of Appeal briefly referred to s 5I, the inherent risk provision in the Civil Liability Act 2002 (NSW) (the case raised a number of causation issues (see 4.9)). During a medical procedure to remove a gall bladder, a surgeon applied diathermy current, at or near the surgical clip attached to the respondent, causing a stricture (abdominal narrowing). Holding in favour of the patient, Gleeson JA (Basten and Ward JJA agreeing) did not accept the defendant’s contention that this injury could be characterised as an inherent risk that could not be avoided. Having analysed the evidence closely, the court concluded that on these facts, the occurrence of the diathermy injury was avoidable by the exercise of reasonable care. Inherent risk issues also arose in Paul v Cooke [2013] NSWCA 311, decided shortly after Cox v Fellows. In this case, which also raised complex causation issues (see 4.3, 4.4, 4.19), the appellant had undergone an operation to remove an aneurysm, during which it ruptured. This rupture was not the result of any negligence. However, the defendant had failed to diagnose the aneurysm three years earlier. Unlike the result in Cox, here, the New South Wales Court of Appeal, comprised of Basten JA (at [7]–[9]) and Leeming JA (at [70]–[78]) (Ward JA agreeing), found that the plaintiff’s harm was the result of the materialisation of an inherent risk that could not be avoided by the exercise of reasonable care and skill. Therefore, liability could not be imposed. In Leeming JA’s detailed analysis of the inherent risk provision, his Honour noted (at [55]) that s 5I is ‘unyieldingly prescriptive’. His Honour succinctly concluded (at [76]): ‘Put simply,

whether or not Dr Cooke exercised reasonable care, Ms Paul always faced the risk of intra-operative rupture if she chose to undergo surgery.’ [page 163]

Warning of risk and awareness: Victoria 3.72 Curiously, only Victoria enacted a special section, which prescribes that if a plaintiff alleges that the defendant failed to give the plaintiff a warning about a risk of harm or failed to give other information, the plaintiff must prove that she or he was not aware of the risk or information: Wrongs Act 1958 (Vic) s 56. It is likely that other states’ legislators regarded this section as unnecessary and superfluous, as ordinary causation principles satisfactorily address this matter of logic: see Chapter 4.

Apologies: at common law and under the statutes 3.73 Expressions of ‘regret’ and ‘apologies’ do not generally constitute admissions of liability. Among other matters, Dovuro Pty Ltd v Wilkins (2003) 215 CLR 317; 201 ALR 139 considered the value of admissions when they embrace conclusions dependent on the application of a legal standard. Gummow, McHugh and Heydon JJ stated that they cannot provide the basis for a negligence finding. Hayne and Callinan JJ noted (at [173]): It may readily be accepted that what is said after an event may constitute an admission of relevant facts. Tendering an apology for what has happened (as Dovuro did to canola growers) may, in some cases, amount to such an admission. But there is always the risk that what is said after the event is informed only by hindsight and the speaker’s wish that the clock might be turned back.

3.74 Legislatures throughout the country considered the effect of apologies and expressions of regret as part of their responses to the ‘litigation/liability insurance crisis’.31 The legislation provides that an apology or expression of regret does not amount to an admission of

liability. Although they are essentially similar, there are slight differences in the nature of the provisions and definitions of what constitutes an apology. For example, in the Northern Territory, Queensland, Tasmania and Victoria, the definition of ‘expression of regret’ or ‘apology’ requires that the statement at issue not contain an acknowledgment or admission of ‘fault’ (or ‘liability’ in some provisions) to be able to claim the statutory protection. New South Wales and the Australian Capital Territory, on the other hand, define ‘apology’ more broadly, such that the apology can, in fact, go so far as to admit or imply an admission of fault. It will nevertheless still be protected under the Act, thereby allowing for the avoidance of liability by the person making the apology. Despite some differences in detail, the rationale underlying all the statutory modifications is clear and uniform: to provide the defendant with an opportunity to express regret, without fearing the legal consequences of doing so — in the form of a finding of legal fault or civil liability. [page 164] 3.75 Several jurisdictions not only ensure that the expression of regret does not amount to an admission of fault or liability, they also prescribe that such statements are inadmissible as evidence in the proceedings as evidence of fault or liability.32 In Victoria, even though an apology is not an admission of liability, unprofessional conduct, carelessness or incompetence, the Wrongs Act 1958 (Vic) s 14J specifically states that this does not affect its admissibility, with respect to establishing a fact in issue. (Victoria extends the protection to cases involving the provision of services, where there has been a reduction or waiver of fees: s 14K.) Problem 1 3.76 Sixteen-year-old Pria was a resident in Daisy Bay Youth Detention Centre (a privately run facility). All of Pria’s meals were provided by the centre. Knowing that they housed several detainees with allergies, including those related to peanuts, the centre publicised its ‘No-Nut Policy’ to all detainees. The ‘No-Nut Policy’ was part of the

centre’s ‘No Food From Outside’ policy, as detainees were told that they could only eat food provided by the centre, indoors. Every Sunday, from 3:00 pm to 9:00 pm, was Visitors’ Day at the centre. Its policy was that all visits were to take place inside the dining hall, under supervision. There was one guard to supervise the 50 detainees and their visitors. The guard had many responsibilities, including the confiscation of prohibited food. Despite the rules, friends and family commonly brought detainees small gifts. In contravention of the centre’s policy, Pria’s roommate, Meg, regularly had visitors who brought food. They had often been caught doing so. On 1 March 2017, Meg’s brother brought Meg a muesli bar made by Nut-Sense Pty Ltd, which Meg hid in her room. She gave it to Pria in exchange for some crystal meth, which Pria’s sister, Di, had snuck into the centre. The muesli bar said on its label, ‘not made with real nuts’. At 8:55 pm, while she was eating the muesli bar in the rose garden, Pria was stung by a bee. Pria began to itch and her tongue swelled; she was suffering a serious allergic reaction, to either the bee sting or muesli bar or both. All doctors agree that allergic reactions of this type are successfully treated by the use of an EpiPen, within two hours of the relevant incident. Its use will prevent the worst consequences of the allergy, such as brain damage. The EpiPen is a costly device that delivers adrenaline into the bloodstream. The centre only had one EpiPen, which at the time of Pria’s emergency was being used by a guard on Elena, another detainee with a peanut allergy. Earlier that month, the centre’s management had debated whether or not the centre should purchase a second EpiPen to address increasingly common allergic reactions, which not surprisingly, escalated dramatically on Sundays. [page 165] By 9:00 pm, Pria began to have difficulty breathing. After several more minutes had elapsed, Pria was taken by a guard to the detention centre’s medical facility. The doctor on duty, Dr Divine, had recently graduated from Devil’s Peak Medical College with a third-class honours degree and a bare pass in ‘Diagnosis 101’. His first job as a general practitioner was at the centre. Dr Divine tried to find out what had happened to produce Pria’s symptoms. Like everyone else working at the detention centre, he knew that the use of illegal drugs (such as heroin) was commonplace among the youths detained there. Because Pria was so short of breath, he thought that she might be showing the first signs of slipping into a heroin overdose. After all, her ‘inmate file’, which he read while examining her, noted her history of drug use, including crystal meth and heroin. Pria sat silent and terrified as she was being questioned by Dr Divine. The more he asked her about her drug use, the more anxious she became. He was unable to draw out any useful responses from Pria. Her shortness of breath worsened. Dr Divine decided to administer Narcan, which is meant to counter the effects of heroin use. Just before treating her with the drug, he told her that some patients who are given Narcan suffer

nausea, which usually goes away within a week. Pria remained silent. Dr Divine gave her the drug. Pria now suffers partial brain damage. According to 75 per cent of cardiovascular (breathing) specialists, Narcan should only be used to treat the effects of heroin use. They assert that Narcan should not be used in any other circumstances because of the greatly increased risk that it could cause brain damage. Even in situations where there has been heroin use, they note that in exceptional cases, Narcan has produced this same result. One year prior to Pria’s incident, the well-respected Spanish medical journal Cardiovascular Weekly published a study which concluded that a doctor who considers treating a patient with Narcan must be meticulous when she or he takes a patient’s medical and case history, as Narcan can worsen the patient’s condition if administered to someone who is not suffering the illeffects of heroin use. However, 25 per cent of cardiovascular specialists state that Narcan is effective in treating all patients suffering breathing difficulties, regardless of the cause of those difficulties — including allergic reactions. In any event, 90 per cent of all cardiovascular specialists state that they would never discuss the risk of brain damage or stroke with patients to whom they administer Narcan, regardless of the circumstances. As they put it, ‘It’s up to us — it’s our call’. In fact, Pria had not used any drugs that evening. As we know, she had been stung by a bee and also had eaten a muesli bar, which was made with synthetic peanut oils. Pria’s bee sting and peanut allergies were noted on her ‘inmate file’, in a footnote at the end of many pages detailing her illegal drug use issues and the reasons for her detention at the centre. Pria institutes a negligence action against the Daisy Bay Youth Detention Centre and Dr Divine with respect to her brain damage. What will Pria, the centre and Dr Divine argue with respect to the standard of care and breach issues that likely will arise in her claim? Do not discuss any other issues.

[page 166]

Discussion Arguments for Pria against the Daisy Bay Youth Detention Centre 3.77 To succeed in an action in negligence against the Daisy Bay Youth Detention Centre, Pria must show that the centre’s actions posed a reasonably foreseeable risk of injury to someone such as herself. It is the risk of injury that must be reasonably foreseeable, not merely the risk of an accident. Pria’s case is governed by the Civil Liability Acts, where relevant, as it is not excluded under the terms of those statutes. Pria would argue that carelessness has occurred in at least two, and perhaps three, ways: (i) failure to provide an adequate number of guards to prevent harm (by way of supervision); (ii) failure to provide a sufficient number of EpiPens to be able to immediately respond to harm; (iii) failure to keep a proper record-keeping system, which

arguably contributed to Dr Divine’s inadequate consultation with Pria and the subsequent poor treatment she received. Pria’s claim needs to be addressed in the light of statutory provisions, which outline how to assess carelessness and respond to risk. This is reflected in all Civil Liability Acts (the Wrongs Act 1958 (Vic) s 48(1) is used here as a typical example), enacted in all jurisdictions except the Northern Territory. The provisions prescribe that the centre is not negligent in failing to take precautions against a risk of harm unless the risk was foreseeable (that is, it is a risk about which the person knew or ought to have known), the risk was ‘not insignificant’, and in the circumstances, a reasonable person in the centre’s position would have taken precautions. Pria would note that this mirrors the common law except in one noteworthy respect. Therefore, the leading case of Wyong Shire Council v Shirt, which has been applied many times, in cases as wide-ranging as Mulligan v Coffs Harbour City Council, Vairy v Wyong Shire Council, Roman Catholic Church Trustees for the Diocese of Canberra and Goulburn v Hadba and New South Wales v Bujdoso, is still relevant. In accordance with the views of a majority of judges in New South Wales v Fahy, the Shirt ‘approach’ (as it is referred to in Mulligan) should still be used. This of course is true to the extent it has not been affected by statute. Its use has been widely endorsed, in cases such as Vella v Permanent Mortgages Pty Ltd, Department of Housing and Works v Smith (No 2), Waverley Council v Ferreira, Mobbs v Kain, Stephens v Giovenco and Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd (in the latter case Sackville JA emphasised the need to carefully follow the statutory requirements). In Wyong Shire Council v Shirt, it was said that a risk of injury is reasonably foreseeable if it is not ‘far-fetched or fanciful’. All jurisdictions (except the Northern Territory) have incorporated a higher threshold, by prescribing the ‘not insignificant’ test: Meandarra Aerial Spraying Pty Ltd v GEJ & MA Geldard Pty Ltd. The raised threshold also was considered in Electro Optic Systems Pty Ltd v New South Wales, Bitupave Ltd (t/as Boral Asphalt) v Pillinger and Erickson v Bagley, leading to varying results which were driven by the cases’ particular facts. As was the case in Drinkwater v Howarth, the evidence here is strong enough to readily satisfy both the lower common law test and the additional or heightened legislative requirement. A similar result ensued in Pollard v Trude. Here, it is clear that the risk of injury [page 167] resulting from not enforcing the contraband policies, not having more than one EpiPen and keeping files in a ‘user unfriendly’ fashion is foreseeable. On the facts, the centre was operating a system that was fraught with risk to a large number of potential victims of harm. It did not have an adequate number of guards on duty to supervise the detainees and enforce the institution’s polices; it did not have enough medical equipment in place to respond to a risk of known harm that it knew escalated on Sundays (Visitors’ Day); it also did not keep inmate files in good order, whereby significant health-related information should have been readily ascertainable, highlighted in a prominent position rather than buried at the end of the file in a footnote.

There was a real risk that a detainee would not follow a loosely enforced rule that involved self-discipline, that more than one person might need an immediate response to allergic reactions and that readily accessible records might be needed in an instant. All of these were risks about which the centre ought to have had knowledge. The risk of harm in all three instances required the centre, as a reasonable defendant, to take precautions: it was ‘not insignificant’ (the criterion statutorily prescribed in all jurisdictions except the Northern Territory); and it was ‘not far-fetched and fanciful’ (the common law test still used in the Northern Territory). All that Pria needs to prove is that the Daisy Bay Youth Detention Centre’s conduct created a reasonably foreseeable risk of injury to someone such as herself, for example, not having enough EpiPens when there was evidence of increased contraband being eaten on Sundays, the day on which, not surprisingly, an increased number of allergic reactions occurred. This clearly created a reasonably foreseeable risk of injury to someone such as Pria (and others). The centre cannot successfully argue that even if this risk of injury was foreseeable, it did not warrant taking precautions, as outlined in the statutes and successfully argued in Dailly v Spot-On Investments Pty Ltd t/as SpotOn Photos, Neindorf v Junkovic, Shaw v Thomas and Graham v Welch, where the respective risks did not require responses. This risk was not of that nature. It warranted a response from a reasonable person; not to guarantee safety, but to reasonably guard against the risk of harm. The centre may argue that Pria acted foolishly and dangerously by eating contraband and going outdoors, when she was prone to suffering allergic reactions. Pria would maintain that this attempt to advance a version of an ‘obvious risk’ argument should not succeed because she thought she was eating a bar without nuts. There was nothing obvious about the risk. Moreover, as the majority in Vairy stated, ‘obvious risks’ should not be elevated to a status whereby it conclusively determines breach issues. Any foolishness on Pria’s part should be left, if at all, to a consideration of contributory negligence rather than as a basis on which to deny breach. The second main principle articulated in Shirt, mirrored in the statutory provisions (for example, the Wrongs Act 1958 (Vic) s 48(2)), would be addressed by Pria: she would argue, in all jurisdictions, that as a reasonable person, the centre ought to have taken precautions against the risk of harm. In accordance with the statutes (reflecting the Shirt approach) a number of factors have to be balanced in assessing the standard of care and establishing a breach. They are the probability that the [page 168] harm would occur if care were not taken, the likely seriousness of the harm, the burden of taking precautions to avoid the risk of harm and the social utility of the activity that creates the risk of harm. No one factor is weightier than another. Pria would contend that the centre could have avoided or minimised the risk to her quite simply by providing additional guards to ensure the detention centre’s own policies were adhered to, providing more medical equipment (EpiPens) to be able to respond to emergencies and keeping inmate files with important medical information in a more

prominent and usable manner (assuming this satisfied the foreseeability and ‘not insignificant’ hurdles). None of these practicable precautions are particularly burdensome, as was the case in Jurox Pty Ltd v Fullick where a ‘modicum of supervision could have been employed. Here, for example, adhering to one’s own policies and having accessible files in good order are not inordinately burdensome. This is dissimilar to what was considered in Hadba, for example (the arguable need for more staff during recess periods), or Refrigerated Roadways. Here, the provision of additional guards could be limited to a finite period, once a week, when there was an increase in the probability of harm occurring — a risk well known to the centre. Even if the court considered this to be somewhat costly, on balance, employing the ‘calculus’ and comparing the burden to the other factors, the reasonable centre ought to have taken these (or other practicable) measures, as was determined by the court in Lee v Carlton Crest Hotel (Sydney) Pty Ltd. Having only one guard on duty for 50 detainees, when there is clear evidence of potential harm (especially on Sundays), is not reasonable. With respect to the nonprovision of a sufficient quantity of medical equipment to be able to immediately respond to harm, the fact that EpiPens are costly is not a viable excuse. Having only one EpiPen available to respond to medical emergencies when the magnitude of the risk of potential harm is well known (and heightened, on Visitors’ Day), is, once again, not burdensome, when compared to the probability of the risk occurring and the severity of the harm if it were to materialise. Where it is possible to guard against a small but foreseeable risk by adopting a precaution that involves little difficulty or expense, the failure to adopt that precaution will generally be negligent. In the present case, the risk of injury was not particularly small: the centre could have guarded against it by adopting several precautions that involved little effort. Its failure to do so was negligent. This is unlike Thompson v Johnson & Johnson Pty Ltd, where the court concluded that the plaintiff could not demonstrate the kinds of practicable precautions the defendant ought to have taken in a limited time frame. It also is dissimilar to Graham Barclay Oysters Pty Ltd v Ryan, where the plaintiffs could not prove what kind of practicable precaution could be taken that would not have had a disproportionate effect on the defendants (ceasing all production). In Paris v Stepney Borough Council, the House of Lords held that an employer should have taken greater precautions to protect the sight of an employee whom the employer knew had lost sight in one of his eyes, than in the case of employees with full eyesight. The graver the injury will be if the risk eventuates, the greater the need for precautions against it. That principle was recognised by Mason J in Shirt’s case when he said that in determining what a reasonable person would or would not [page 169] have done in a particular situation, the court must take into account the magnitude of the risk as well as the degree of probability of its occurrence. As was noted above, this is reflected in the civil liability statutes, which apply in all jurisdictions except the Northern Territory. Here, even if one could argue that the risk of

injury or damage as a result of inadequate staffing, inadequate medical supplies and inadequate record keeping was quite small (which Pria does not concede), the injury or damage would be serious if it eventuated, because it would be damage sustained by someone whom the defendant knows is potentially more at risk of being severely injured (based on Pria’s inmate file, and her actual propensity to suffer allergic reactions). In accordance with the provisions in the statutes and principles in Paris and Shirt, the gravity of the potential risk to a vulnerable person adds weight to the argument that the centre should have taken more precautions than it did when implementing its potentially dangerous system — a system naively based on inmate self-regulation (not unlike the ‘system’ unreasonably relied upon in Bujdoso). Although it may appear somewhat curious to do so, Pria could argue that the policies the centre implemented, which it expected detainees to follow, are inapt. In doing so she could employ (arguably with some hesitation) McHugh J’s dissenting comments in Hadba about the mischievous nature of children at school and how it is unrealistic — and unreasonable, when balanced against the seriousness of potential harm and its probability — to rely on such a system of self-discipline. To think that prohibitions or mere rules (without more adequate supervision and medical measures necessary to respond to harm) will amount to a practicable and adequate response to the potential risk of harm is unreasonable. The centre should have done more, as a reasonable youth detention centre, in the circumstances, when it knew it housed several detainees with potentially life-threatening medical conditions. Any ‘social utility’ argument raised by the centre, based on the need to rehabilitate detainees through interactions with family and friends on Visitors’ Days, cannot circumvent safety requirements and the need to respond reasonably to risks about which the centre had actual knowledge (as illustrated in Bujdoso). Finally, there is no basis on which the reasonable person standard should be modified. The centre should not be able to avail itself of the peer professional opinion provisions in a number of the Civil Liability Acts. They are not ‘professionals’, as intended by the legislation (and, in Western Australia, clearly are not ‘health professionals’). Any latitude enjoyed by defendants by virtue of these sections is more aptly discussed in the case against Dr Divine, below. Arguments for Daisy Bay Youth Detention Centre 3.78 In order to determine whether the Daisy Bay Youth Detention Centre acted negligently with respect to the way in which it responded to the risk of detainees’ potential harm (associated with medical conditions), it must first be determined whether its actions posed a reasonably foreseeable risk of some kind of injury to someone such as Pria. In Wyong Shire Council v Shirt, it was established that a risk of injury must be reasonably foreseeable. Mason J stated that the risk must be one that is not ‘far-fetched or fanciful’. While this very low threshold test is used in the Northern Territory, legislation in all other jurisdictions requires the risk to be [page 170] foreseeable (a risk about which the person knew or ought to have known) and it must be

‘not insignificant’. The centre would argue that the intention of this deliberate legislative change, based on the Ipp Panel’s recommendation, is to revitalise the touchstone of reasonableness when assessing the standard of care and finding breach. It must be given due attention when deciding cases. The importance of the need for the court to carefully consider all the statutory requirements was highlighted by Sackville JA in his separate majority judgment in Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd and by Allsop P in Stephens v Giovenco. Here, it was unlikely that Pria would suffer an allergic reaction to a food product that claimed to be ‘nut-free’. This was an insignificant risk — one that could be ignored. This is dissimilar to Drinkwater v Howarth and Pollard v Trude, where the evidence sustained both the lower common law threshold (not far-fetched and fanciful) as well as the legislated criterion. The possibility of her suffering harm was extremely low, considering she ate what was meant to be a safe product, which is not unlike Erickson v Bagley, where the risk of injury of falling on the driveway in an unlit area was held to be insignificant. The centre acknowledges that Pria will no doubt argue that even this raised criterion is readily met: there was evidence of violations of the ‘no food from outside’ policy and knowledge on the part of the centre it was transgressed. The centre should therefore be prepared for the court to find the ‘not insignificant’ and foreseeable risk requirements satisfied. However, even if this is established, breach should still not be found, as there is no basis for determining that a reasonable person would have done more by way of taking precautions against the risk of harm than did the centre. After the event, it is easy to imagine precautions that would have reduced or removed the risk of damage if the centre had taken them. However, the court must avoid the temptation to judge the centre’s conduct after the fact, using hindsight, as Hayne J highlighted in Mulligan v Coffs Harbour City Council, Vairy v Wyong Shire Council and New South Wales v Fahy. This is also clear in cases such as Roe v Minister of Health and Refrigerated Roadways. The real question is whether a reasonable detention centre would have taken precautions of the kind Pria advocates, before the occurrence of an incident like the one that befell Pria. In Inverell Municipal Council v Pennington, Mahoney and Clarke JJA said that the principle stated by the High Court of Australia in Shirt’s case conceives of the possibility that a reasonable person in the defendant’s position might take no action against a small but foreseeable risk, despite the fact that it might be simple to provide a measure of protection against it, simply because that risk was so unlikely to eventuate. In Dailly v Spot-On Investments Pty Ltd t/as Spot-On Photos, the Court of Appeal of New South Wales applied that principle when holding that the defendant had not been negligent, even though it had failed to take a simple, cheap (perhaps even cost-free) precaution against a small but reasonably foreseeable risk. This also is reflected in the reasoning in Neindorf v Junkovic and Drew v New South Wales, where the respective risks did not require responses. The Civil Liability Acts also allow for a defendant to not respond to very small risks of foreseeable, ‘not insignificant’ harm. Although there may have been a risk that Pria might suffer damage as a result of the centre not having more guards on duty or more medical equipment, it was so [page 171]

small that the reasonable institution in the centre’s position would not have bothered to take even a simple precaution to guard against it. As for the need to implement a different record-keeping system, it is difficult to see how the system that was used even created a foreseeable risk of harm, as her allergies were recorded. This complaint should fail at that early juncture. Assuming the court holds that the risk of injury is reasonably foreseeable and a ‘not insignificant risk’, as an alternative argument, the centre may attempt to rely on Romeo v Conservation Commission of the Northern Territory, where the High Court of Australia held that the defendant had not been negligent despite its failure to fence a cliff or put up warning signs to guard against the foreseeable risk that someone (such as the plaintiff), under some impairment of the senses, might fall over the cliff. The risk posed by the cliff was obvious; the risk that someone might be injured despite the obviousness of the danger was so small that it did not warrant the inconvenience and expense of guarding against it. Here, too, the risk posed by contraband, especially to someone like Pria, should have been obvious — especially to Pria. One reason the damage occurred was because Pria herself violated several rules and the system established by the centre to guard against the risk of harm materialising: she ate prohibited food, despite many warnings to not do so, and she wandered into the rose garden (where she was stung by a bee) despite being told not to do so. For someone with such severe allergies, who therefore ran the risk of suffering serious harm, Pria should be held responsible for her own injury. The centre should argue that there was no reason for a reasonable detention centre in its position to have contemplated that Pria would willingly expose herself to the risk of harm by violating rules that were implemented in order to effect safety — to prevent her from potentially causing harm to herself. As Callinan and Heydon JJ emphasised in Vairy and Mulligan, where the risks of harm are obvious risks, they are not ones to which the defendant need respond. The centre would however need to acknowledge that at common law the majority in Vairy and Mulligan refused to elevate obviousness of the risk to a status which conclusively determines these issues. (Further, the statutory provisions, discussed in detail in Chapter 11, are of no avail, as it is unlikely that the definitions would be satisfied.) The centre may also attempt to rely on Woods v Multi-Sport Holdings Pty Ltd. No breach was found in that case, in part because the risk of damage to the plaintiff’s eyesight was considered so obvious that the plaintiff could not claim a breach by the defendant for not warning him of the injury and not providing him with protective equipment. The present case is similar. The risk posed by eating the muesli bar (despite its claim to be nut-free) and visiting the rose garden was obvious. Here, Pria should have recognised she might suffer harm by going to the rose garden and eating contraband. The centre would, however, have to concede that this argument, factually, could be difficult to sustain. Mason J’s second question in Shirt, involving what the reasonable person’s response should be to the foreseeable risk of harm, is reflected in statutory provisions enacted across the country (for example, as in the Wrongs Act 1958 (Vic) s 48(2), which mirrors the common law, articulated in Shirt): see, for example, Telstra Corp Ltd v Bisley, Vella v Permanent Mortgages Pty Ltd, Waverley Council v Ferreira, Mobbs v Kain and Roads and Traffic Authority of New South Wales v Refrigerated Roadways

[page 172] Pty Ltd. Sackville JA in Refrigerated Roadways and Allsop P in Stephens v Giovenco highlighted the need to adhere to the statutory provisions. Shirt itself is still the governing test in the Northern Territory. The centre would contend that it acted as a reasonable person, having regard to the precautions it took against the risk of harm, and the other factors that have to be balanced when assessing the standard of care and establishing a breach. These factors, outlined in the Civil Liability Acts, include the probability that the harm would occur if care were not taken, the likely seriousness of the harm, the burden of taking precautions to avoid the risk of harm and the social utility of the activity that creates the risk of harm. No one factor is to be accorded necessarily greater weight than another. The Daisy Bay Youth Detention Centre would argue that the precautions it already had implemented (such as its policy against consuming food from outside and the provision of a guard) were sufficient, bearing in mind the nature of the risks of harm facing some of the detainees (such as allergic reactions). It would argue strongly that reasonableness did not dictate that it should have done more than it did. While it is recognised that cases such as Roman Catholic Church Trustees for the Diocese of Canberra and Goulburn v Hadba and New South Wales v Fahy, for example, are merely applications of the Shirt approach and are not therefore binding (because every case is decided on its own facts), they are helpful illustrations of the way in which this kind of case, involving the implementation of reasonable systems to avoid potential harm, have been dealt with by the High Court of Australia. By way of comparison, it is interesting to note that in Hadba, the school’s ‘no hands rule’ was a reasonable and sufficient response to the risk of harm in the playground, at recess. A similar determination should be made in the instant case. Any suggestion that more guards should be employed or costly medical equipment (EpiPens) should be purchased would be far too burdensome, having regard to the low probability that harm would occur. This is similar to Roads and Traffic Authority of New South Wales v Dederer and Refrigerated Roadways and how these considerations affected the outcomes in those cases. As was the case in Hadba, reliance on the institution’s policies to regulate behaviour and minimise harm was reasonable and sufficient. While the centre may concede that the seriousness of potential harm is high, this is but one factor to balance with several others, when assessing the standard of care expected of the reasonable person in the circumstances (as in Graham, where precautions were not practicable). Further, social utility was enhanced by having friends and relatives visit on Sundays without having an inordinate amount of intervention and supervision (somewhat similar to the Hadba majority’s considerations). It was in detainees’ interests to encourage contact with the outside world, for rehabilitation and eventual integration with the community. Although Pria may assert that this type of argument failed in Bujdoso, the centre will note that the circumstances of Bujdoso were very different to the present, given the special risk Bujdoso was in, as a likely target of violence that the prison knew about. Therefore, the decision in Bujdoso with respect to its breach determination does not have precedential value. Indeed, all parties should note that breach determinations or results are too factually specific to be binding.

No more was required of the centre as a reasonable youth detention centre in the circumstances. Furthermore, as the Wrongs Act 1958 (Vic) s 49(b) and other Civil [page 173] Liability Acts similarly prescribe, the fact that a risk of harm could have been avoided by doing something in a different way does not of itself give rise to or affect liability for the way in which the thing was done. Finally, although the centre may wish to argue that it benefits from the peer professional opinion sections in a number of Civil Liability Acts, it should in fact concede that it would be difficult coming within its terms. Dr Divine is better placed than the centre with respect to availing himself of these provisions. Arguments for Pria against Dr Divine 3.79 There are several failures or breaches that could be alleged by Pria against Dr Divine. These include failure to take a proper history when her condition was being diagnosed and treating her with Narcan to counter the effects of heroin use, even though she had not used heroin. She could also argue that Dr Divine did not act reasonably because he did not warn her of the possible side effects of the use of Narcan. All of Dr Divine’s actions in 2017 must be judged against the standard of care that a reasonable doctor treating a patient would have exercised in 2017, as in Roe v Minister of Health. Here, the risk of harm was reasonably foreseeable, as evidence of Narcan’s side effects and how it should be used were known or ought to have been known; this was ‘not insignificant’. Further, responses to this risk of harm were clear: take a better history; do not use Narcan in these circumstances; warn of its side effects. This aspect of the claim is to be made in accordance with the Civil Liability Acts in most jurisdictions; in the Northern Territory, Shirt’s case governs. The most significant issues in Pria’s claim against Dr Divine involve his status as a professional. There was awareness within the medical profession that Narcan may not be an appropriate treatment for someone in Pria’s circumstances. General practitioners like Dr Divine should have had an awareness of the risks associated with the drug in cases outside those associated with heroin use (and even in those cases in exceptional instances). They also should have had knowledge that not taking a proper history from a patient as to what led to her condition, and not thoroughly reading her file, can lead to an incorrect diagnosis and inappropriate treatment regimens, with foreseeable and serious consequences. It is immaterial that Dr Divine is not a cardiovascular specialist. The court must have regard to the defendant’s special skills as a professional (as observed in Imbree v McNeilly). If the centre is in the Australian Capital Territory or Northern Territory, the question of what a reasonable general practitioner would or would not have done in 2017 is to be determined at common law. Dr Divine may argue that this case raises complex, technical issues beyond the understanding of most if not all judges. In Rogers, the High Court held that (at least so far as the provision of information or advice is concerned) a

doctor should not be judged solely by reference to evidence about the practice of reputable professionals in that field. In Naxakis, the High Court held that the Bolam test was inapplicable to all aspects of medical care. At common law, the court must adjudicate on what is the proper standard of care, even though the judge’s knowledge of the relevant area is less than that of the expert witnesses. Therefore, if this case were determined at common law, the court should not hesitate to adjudge Dr Divine’s conduct as negligent, regardless of how technical the issues [page 174] involved are said to be. Not taking a proper incident history, not reading a patient’s file thoroughly, and not being aware of an article in a well-respected journal that had been accessible for over a year which is directly relevant to the later treatment he administered, is careless. Pria would argue that what a reasonable doctor would have done with respect to diagnosing and treating her should be assessed by the court (Rogers v Whitaker). While the profession would of course provide evidence and an opinion as to what was an appropriate practice, this should not be decisive. At common law the court will not shrink from concluding that a practice adopted by all (or the majority) of an industry or profession falls short of the standard of care that would be adopted by a reasonable person in that industry or profession (noted in Woods v Multi-Sport). Rogers and Naxakis v Western General Hospital hold similarly for doctors. Pria would argue that Dr Divine’s conduct in his initial consultation with Pria was unreasonable. He prejudged her symptoms as ones associated with illicit drug use, without adequately taking a history from her on which he should had made his diagnosis. The fact that she had been stung by a bee and had eaten a potentially suspect product causing her itchiness, swollen tongue and breathing problems were not ‘meticulously’ discovered by Dr Divine. Indeed, in this case, jumping to the conclusion that her condition was related to drug use, which then led to the administration of a potentially hazardous drug, Narcan, is below the level of care expected of a reasonable doctor. Further evidence in support of this carelessness is provided by the journal article, of which he should have been aware. Even if the centre is in a jurisdiction where peer professional opinion has been introduced by statute to offer protection to someone like Dr Divine (a ‘professional’ and, more precisely, a ‘health professional’ in Western Australia, according to the Civil Liability Act 2002 (WA) s 5PA), Dr Divine would be hard-pressed to establish that his diagnosis and consultation with Pria (leading up to treatment) was in a manner that was widely accepted in Australia as competent professional service (Civil Liability Act (NSW) s 50(1), and equivalent provisions elsewhere). Indeed, in Dobler v Halverson, the peer professional opinion provision in the New South Wales Act did not protect the defendant doctor from being found liable for his careless treatment. Similarly, the radiologist in Freestone v Murrumbidgee Local Health District was found liable for a significant oversight, which involved the failure to identify and report a lesion when a CT scan was initially performed. Peer professional opinion could not be relied upon because the failure to report the lesion was not widely accepted as competent professional practice.

According to Dobler and Sydney South West Area Health Service v MD, the professional must plead and prove this defence. Similar views have been expressed in Brakoulias v Karunaharan; Grinham v Tabro Meats Pty Ltd; Victorian WorkCover Authority v Murray; Mules v Ferguson; Freestone v Murrumbidgee Local Health District; Rothonis v Lattimore. Pria would contend that even if a large number of doctors support Dr Divine’s position by saying they would have acted similarly, the court should regard this as ‘irrational’ (in New South Wales, Queensland, South Australia and Tasmania). This poor practice could even meet the Western Australian test under s 5PB(4), that it was ‘so unreasonable’ that no reasonable professional could have acted similarly. Evidence supporting Dr Divine would most certainly be considered unhelpful in [page 175] Victoria under its test of reasonableness in the Wrongs Act 1958 (Vic) s 59(2) and at common law in the territories. Furthermore, in Victoria and Queensland, the evidence supporting Dr Divine must come from a ‘significant number’ of peers. Ultimately, there is no justification for not taking as thorough and accurate a history as possible, without prejudging the reasons for the patient’s symptoms. Doing otherwise can lead to dire consequences, as here. This type of conduct cannot be protected by the like-minded opinions of others in the field. They too should also be found to be negligent if they would have acted similarly. To sum up these points, the court is obliged to examine the evidence — what was known and when it was known — to determine whether a duty of care had been breached and, if need be, whether the opinion of peers is irrational (or unreasonable). The evidence here clearly showed that Pria’s health could be seriously compromised if her condition and the reason for it were not diagnosed accurately. As was the case in Dobler v Halverson, this time with respect to a different breach, the statutory defence of peer professional opinion should not avail Dr Divine, as no competent body of professionals would have acted in a manner similar to him (without having to resort to considerations of rationality — as prescribed in a number of jurisdictions). If the centre is in Victoria or South Australia, it should be noted that Dr Divine held himself out as possessing a particular skill. He must therefore be judged against what is expected of a person with that skill at the time of the alleged negligence (Wrongs Act 1958 (Vic) s 58 and Civil Liability Act 1936 (SA) s 40). This is similar to the common law. Imbree noted that adjustments are made for particular skills and specialisations, where warranted. Moreover, because Dr Divine does not have to be the best in his field (Heydon v NRMA Ltd), the fact that he graduated with a middling degree (third-class honours) and a bare pass in ‘Diagnosis 101’ is irrelevant. Dr Divine may argue that he should be judged against the standard of care reasonably expected of a general practitioner, and not against the standard expected of a cardiovascular specialist. However, even a general practitioner would have acted more reasonably than Dr Divine, bearing in mind the information that existed at the time, and the fact that his professional care extended to treating patients complaining of itchiness,

swelling and breathing difficulties, especially when these symptoms present well-known risks. As the High Court in Rogers stated (followed in Heydon v NRMA Ltd), professionals are ‘bound to have and to exercise a degree of skill and care that is to be expected of persons professing and practising in their area of expertise’. A general practitioner’s area of expertise extended to treating patients like Pria. Dr Divine held himself out to a certain standard. His inexperience, as a relatively new graduate, is no excuse. He has to fulfil the responsibilities of those with his certified qualifications. Because the High Court in Imbree overruled Cook v Cook, any argument based on the Cook ratio (a lower standard of care is owed by a learner driver to an instructor who knows of the learner’s inexperience and consents to driving with the learner) is incorrect. According to Imbree, the standard of care in such circumstances is not modified downwards. Aside from diagnosis issues, Pria would also argue that Dr Divine was in breach because he administered Narcan. As a reasonable doctor, he ought to have known [page 176] of its potential capacity to cause brain damage and strokes. This heightens the significance of his breach when he did not diagnose the reason for Pria’s condition: had he provided a service expected of a reasonable doctor, Pria could perhaps have been provided with a different treatment. The majority (75 per cent) of cardiovascular specialists would not administer Narcan in non-heroin use circumstances. In fact, it was risky even in the drug use context (in exceptional cases). Dr Divine may attempt to rely on the fact that 25 per cent of specialist doctors would support treatment with Narcan in circumstances not involving heroin use as an example of peer professional opinion reflecting a competent professional service. However, these views should be assessed by the court as irrational or unreasonable (depending on the jurisdiction in which the detention centre is located). Because of these differing opinions, Pria would concede that establishing this treatment breach may be more difficult than that solely concerned with the faulty consultation and diagnosis, discussed above. Pria will also argue that Dr Divine acted below the requisite standard expected of a reasonable doctor with respect to informing patients of ‘material risks’ (as in Rogers) when he treated her with Narcan without telling her of the risks associated with its use. He should have informed Pria about the material risks associated with its use, as required by Rogers v Whitaker and subsequent cases that have applied Rogers, such as Waller v James (which failed on causation). On these facts, this includes the possibility of causing brain damage or strokes. It is hard to know how concerned Pria was about the risks associated with treatment (unlike the patient in Rogers, who was obviously very concerned about her health) as she was frightened and unable or unwilling to communicate. Ironically, this seems to have been the result of Dr Divine questioning her about her drug use (which precludes any attempt by Dr Divine to employ therapeutic privilege to excuse his non-disclosure). The chance of sustaining brain damage or a stroke is a material risk, as this was a health risk to which Pria would attach significance. It meets the statutory requirements in

Queensland and Tasmania (which are states that specifically address proactive and reactive warnings in this context). Moreover, Dr Divine did warn Pria that she might suffer nausea. If he mentioned one side effect, why not mention all other risks, especially ones that are much more serious than nausea? Indeed, Pria may well have been under the misapprehension that she had all the information necessary to make an informed assessment to go ahead with the treatment, when in fact Dr Divine had been rather selective in what he disclosed to her about risks. The fact that the vast majority of doctors would not warn of Narcan’s potential risks does not provide Dr Divine with a valid or excusable reason for withholding information about potential risks or side effects. First, peer professional opinion is not an effective excuse in cases involving warnings and advice about risks in the health care context: see Wrongs Act 1958 (Vic) s 60 as well as equivalent sections elsewhere, largely preserving Rogers. Further, some doctors would indeed testify that they would have told Pria of these material risks. Dr Divine’s failure to warn Pria of brain damage or a stroke was unreasonable, regardless of where in Australia the Daisy Bay Youth Detention Centre is located. [page 177] Arguments for Dr Divine 3.80 Dr Divine’s arguments will focus on his conduct as a reasonable professional, and the latitude that should be given to him in the circumstances rather than issues associated with the ‘calculus of negligence’ under the civil liability statutes or at common law, in the Northern Territory. In Rogers v Whitaker, the High Court of Australia held that the actions of an ophthalmic surgeon were to be judged against the standard of the ordinary skilled person exercising and professing to have the special skill exercised by the actual defendant. Taking the same approach in the present case, Dr Divine’s actions are to be judged against the standard appropriate to a member of the profession, as a general practitioner, with the relevant professional skills: see also Heydon v NRMA Ltd. Dr Divine is not a cardiovascular specialist; he should not be judged against the standards expected of reasonable specialists who have great familiarity with breathingrelated conditions: he should not be expected to have those special skills. This is also the case in Victoria, where the Wrongs Act 1958 (Vic) s 58 makes it clear that Dr Divine should be judged against what could reasonably be expected from someone with his skill. Dr Divine acted as a reasonable general practitioner — his area of expertise — when he met with and treated Pria. The Civil Liability Act 1936 (SA) s 40 is to the same effect. According to the High Court in Imbree, no modification is to be made with respect to the standard of care owed by learner drivers to supervisors who have knowledge of the learner’s inexperience. Therefore, Dr Divine should be advised that it would be misguided (and ill-advised) to rely on his inexperience, seeing that he professed to have the standards of a medical professional — a qualified general practitioner. The court would ignore factors such as his average grades when it makes its assessment of his reasonableness.

A more viable argument for Dr Divine involves the basis on which he treated Pria. Dr Divine would argue that because most general practitioners would have assumed that Pria’s condition was related to drug use, based on her drug use history and the fact that drugs such as heroin were commonplace at the Daisy Bay Youth Detention Centre, he did not fall short of the relevant standard of care when he diagnosed her condition as one related to heroin use, necessitating treatment with Narcan. His consultation, diagnosis and treatment were in line with what other general practitioners would have done. Even in the purely common law context, where peer professional opinion is not decisive, what others do or would have done is important evidence to which the court should turn when assessing the standard of care expected of the defendant. As Woods v MultiSport Holdings Pty Ltd demonstrates, industry practice can be important to determining reasonableness. Dr Divine would concede that this is not conclusive: this was noted in Roche Mining Pty Ltd v Jeffs, Erwin v Iveco Trucks Australia Ltd and Mercer v Commissioner for Road Transport and Tramways (NSW). Here, there is no reason for Dr Divine to have acted differently from others in his profession. At most, what he did when he was responding to an emergency situation was a mere error of judgment. It was not negligence (unlike the finding in Dobler v Halverson). Dr Divine would further argue that he was not required to keep up to date with specialist journals, especially one-off publications from overseas. [page 178] The Spanish journal was earmarked for cardiovascular specialists — a cohort against whom his conduct should not be measured. Although Dr Divine would acknowledge that the Bolam principle (doing what a responsible body of doctors would do excuses allegations of negligence) is no longer the correct common law principle in Australia, due to Naxakis (with respect to diagnosis and treatment), he would note that a modified version of Bolam has been introduced by statute in a number of jurisdictions. Therefore, he would contend that his conduct should be assessed on the basis of peer professional opinion. He would maintain that with respect to treating Pria’s condition with Narcan, 25 per cent of specialists would have acted similarly, using it regardless of the cause of her breathing difficulties. Whether Dr Divine is judged at common law (in Darwin or Canberra, for example) or under the ‘peer professional opinion’ legislative provisions in all other jurisdictions, Dr Divine should not be found in breach with respect to administering this drug. This is so even if supporting evidence from a ‘significant number’ is required (as in Queensland and Victoria under the Civil Liability Act 2003 (Qld) s 22(1) and Wrongs Act 1958 (Vic) s 59(1) respectively). As the court held in Freidin v St Laurent, the practice or opinion does not have to be universally accepted; rather, it has to be ‘widely accepted’ by respected practitioners in the field. Therefore, the peer professional opinion offered in support of Dr Divine’s conduct need not be endorsed by a majority of the profession (although, as is noted above, Victoria and Queensland prescribe that the supporting opinion be that of a

‘significant number’). Here, endorsement by 25 per cent of specialists amounts to sufficient support to justify or excuse Dr Divine’s treatment. When judged against that standard and with the supporting medical opinion as evidence, Dr Divine did all that could reasonably be expected of him. Moreover, it would be inappropriate on these facts and this evidence for the court to assess this opinion, as to when Narcan should or should not be used, as ‘irrational’ (or ‘unreasonable’, in Victoria or ‘so unreasonable’, in Western Australia). While it could perhaps be argued that Dr Divine’s diagnosis and treatment of Pria were errors, they cannot be said to be unreasonable, in the light of the level of understanding available to ordinary general practitioners operating a practice in a detention centre. More evidence would be required before a conclusion of unreasonableness can be imposed. There is insufficient evidence here with respect to the exact opinion of practitioners, who might find themselves in Dr Divine’s position. He made a quick judgment as to the cause of the patient’s serious condition, requiring imminent treatment. The court’s conclusion should be formulated as follows: as a general practitioner, the defendant did not fall short of the relevant standard of care appropriate to the level of expertise he professed to have and ought to have had in 2017, having regard to peer professional opinion. Evidence of what other doctors would have done is necessary before a conclusion of unreasonableness can be made and here, no such evidence is forthcoming; rather, all we have is speculation that other doctors might have acted differently in these circumstances. That said, it is likely that excusing Dr Divine’s conduct on the basis of peer professional opinion in the consultation and diagnosis context will be more difficult than with respect to the actual treatment employed. Dr Divine acknowledges that he must plead and prove the defence based [page 179] on peer professional opinion, according to Dobler, Sydney South West Area Health Service v MD, Brakoulias v Karunaharan, Grinham v Tabro Meats Pty Ltd, Victorian WorkCover Authority v Murray, Mules v Ferguson, Freestone v Murrumbidgee Local Health District and Rothonis v Lattimore. If it is found that Dr Divine acted in a manner that was widely accepted in Australia peer professional opinion as competent professional service, this should not interfered with by the court. There is nothing about his conduct, factually, that could assessed as ‘unreasonable’ (Victoria), ‘so unreasonable’ (Western Australia) ‘irrational’ (New South Wales, South Australia, Queensland, Tasmania).

by be be or

Dr Divine cannot be said to be in breach because he did not warn Pria about the risks associated with the use of Narcan. Whether this is judged at common law (in most jurisdictions, where the provision of advice, warnings and information about risks is not protected by peer professional opinion) or in accordance with statutory provisions (Queensland and Tasmania), he acted reasonably. There is no reason to think Pria would have attached significance to this risk, as required by Rogers and cases which have applied the test, including Biggs v George, Morocz v Marshman, and Waller v James. In fact, the courts in Biggs and Morocz held that the defendants had satisfied the test’s

criteria; Waller failed on causation. Like all breach cases, these decisions, applying Rogers, are factually driven in result, requiring close assessments of the circumstances of each case. Here, Pria did not provide useful answers to his questions when being examined and became increasingly anxious. When told of the risk of nausea, she sat silently. A patient in her position also would not have attached significance to the risk, bearing in mind what was of immediate concern — responding to her breathing difficulties. There was no reason for Doctor Divine to do more, as Pria’s silence suggested an attitude to her predicament in which she was comfortable with her interaction with him. Finally, Dr Divine can attempt to rely on therapeutic privilege, noted in Rogers v Whitaker, as a valid reason for not providing Pria with information about the risk of stroke or brain damage. Because of Pria’s temperament and state of anxiety, Dr Divine would argue that withholding this information from her was in her best interests. Dr Divine also would rely on the support offered by the vast preponderance of specialists, that they too would not have warned patients of these risks. Although this is not an excuse in the Bolam sense, and peer professional opinion does not provide a justification for non-disclosure as under the Civil Liability Acts, the fact that 90 per cent of specialists would not have told patients of the risks associated with Narcan is very weighty evidence, supporting his conduct in this context.

Problem 2 3.81 Millennial Denny was surfing the web for sites that offered suggestions for party themes. He found , which said, ‘Looking for innovative and inexpensive ideas for your next gathering? Want to be a crowd pleaser? Look no further — why not try a fondue dinner party?! Throw on your fun cap, fun-ky shawl and get ready to host this “fun do”’. [page 180] Stingy by nature, Denny bought an authentic, vintage, pre-loved (second-hand), 1970s fondue set at Thrifty’s, Daisy Bay’s local flea market and second-hand shop, for $5.00 — a bargain. He also purchased a set of six uninsulated metal spearing forks. So, to commemorate all things ’70s, Denny — well-liked more for his boyish charm and good looks than his intellect — hosted his first fondue party in his new flat, to which he invited his former housemates. Dressed as their favourite ‘70s singing stars, Denny, Jenny, Lenny and Penny danced up a storm on the orange nylon shag rug Denny had purchased from Thrifty’s for the occasion. Despite having recently suffered the loss of her right arm, Penny was remarkably good humoured, no doubt aided enormously by several margaritas she had consumed. Because his guests were unfamiliar with how fondue sets (and fondue parties) worked, Denny proudly read from his set’s instructions: ‘This stylish stainless steel fondue set

has a chafing dish, which is placed above the small canister (or burner). The canister contains methane gas — and an open flame.’ He continued, enthusiastically: ‘I’ll place the dish and canister in the middle of the table. Each of you should take your long thin metal fork, spear a chunk of bread, and dip the bread in the fondue mix — made of melted cheese and ‘Bottom-of-the-Barrel Sauvignon Blanc’ (which is heated in the pot or chafing dish). It’s easy! Even you’ll be able to figure it out, Penny!’ Unfortunately, the fondue set’s flame-control mechanism occasionally slipped — from being set at a ‘low’ level, to ‘high’. Denny had discovered this irritation when he tried out his new set, a week before his ’70s celebration. Penny, a clumsy person with a big appetite, was somewhat awkward at the art of fondue. Feeling a little tipsy, Penny dipped her metal fork (repeatedly) in the overfilled chafing dish; she lost control of her fork, as it was burning her hand. The large chunk of bread fell into the dish; the melted cheese splattered onto the large open flame, and a spark landed on her polyester pant suit, igniting her synthetic wig as well as Denny’s shag rug and brown leisure suit — all of which were highly flammable. Fortunately, Denny’s lava lamp, sitting on a table a metre away, did not contribute to the conflagration. Penny suffered serious burns. Penny sued her former friend and housemate Denny, arguing that Denny had breached his duty of care. Discuss.

Further discussion 1. Can you reconcile cases such as Vairy v Wyong Shire Council and Mulligan v Coffs Harbour City Council with cases such as Nagle v Rottnest Island Authority and Inverell Municipal Council v Pennington? Or do the former cases simply represent a relatively ‘modern’ point of view with respect to and emphasis on ‘personal responsibility’? 2. Do you think concerns about the ‘liability insurance crisis’ may have influenced the decisions in Woods v Multi-Sport Holdings Pty Ltd? Mulligan? Vairy? Should such concerns be relevant? Or should they have nothing to do with principles governing when fault should be found? [page 181] 3. In New South Wales v Fahy, Kirby J dissented (at [169]):

[T]he law of torts serves a dual purpose. It exists to provide means of redress and compensation for those who suffer actionable civil wrongs caused by others. But it also states the community standards, including standards of accident prevention that have their clearest application in the employment context.

Do you agree? Do the cases noted in this chapter support your view? 4. Do you agree with Callinan and Heydon JJ in Mulligan, where they expressed concern about tort law’s imperialistic nature? Is this still a concern (if it ever was)? 5. Why have courts held that when a defendant takes precautions after an accident (but before trial), this does not amount to an admission of liability? 6. Do you think third party insurance played a part in some of the results discussed in this chapter? For example, can the cases of McHale v Watson, Adamson v Motor Vehicle Insurance Trust and Carrier v Bonham be rationalised on the basis of loss distribution objectives that may have influenced their outcomes (even though those concerns were not articulated)? 7. Do you think the High Court of Australia in Imbree v McNeilly was correct to overrule its decision in Cook v Cook? Why? 8. Do you think members of the Ipp Panel would be pleased with the ways in which its recommendations with respect to peer professional opinion in the medical negligence context (i) have been enacted by Australian legislatures and (ii) interpreted by the courts? 9. Are there circumstances in which a reasonable woman would act differently from a reasonable man? When, if ever, should the defendant’s gender be taken into account in determining the standard of care? 10. Revisit Pria’s predicament after you have explored causation in Chapter 4. What causation-related arguments would the parties make? 11. Revisit Pria’s predicament after you have explored defences in

Chapters 10

and 11. How would defences affect Pria’s claim?

Further reading Allen J, ‘Variable Standards of Care in Negligence’ (2009) 17 Tort Law Review 5. Balkin R P and Davis J L R, ‘Breach of Duty’ in Law of Torts, 4th ed, LexisNexis Butterworths, Sydney, 2013, Ch 8. Barker K, Cane P, Lunney M and Trindade F, ‘Negligence: Negligent Conduct’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 8. Harding M and Malkin I, ‘Overruling in the High Court of Australia in Common Law Cases’ (2010) 34 Melbourne University Law Review 519. [page 182] Ipp D, ‘The Reach of the Dederer Principle’ (2010) 18 Torts Law Journal 125. Lee J, ‘The Standard of Medical Care Under the Australian Civil Liability Acts: Ten Years On’ (2014) 32 Journal of Law and Medicine 335. Lee M, ‘Safety, Regulation and Tort: Fault in Context’ (2011) 74 Modern Law Review 555. Luntz H, ‘Reliving History’ (2010) 18 Torts Law Journal 107. Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Negligence: Breach of Duty’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 3. Martin W, ‘The Civil Liability Act: Impact and Effect’ (2011) 22 Insurance Law Journal 187.

McDonald B, ‘The Impact of the Civil Liability Legislation on Fundamental Policies and Principles of the Common Law of Negligence’ (2006) 14 Torts Law Journal 268. McGivern B and Handford P, ‘Two Problems of Occupiers’ Liability: Part One — The Occupiers’ Liability Acts and the Common Law’ (2015) 39 Melbourne University Law Review 128. —, ‘Two Problems of Occupiers’ Liability: Part Two — The Occupiers’ Liability Acts and Civil Liability Legislation’ (2015) 39 Melbourne University Law Review 507. Sappideen C, ‘Medical Teams and the Standard of Care in Negligence’ (2015) 23 Journal of Law and Medicine 69. Vines P and Kozlina N, ‘Using the Wider Common Law as a Baseline to Defend Subversion by Statute? The Case of the Professional Negligence “Defence” in New South Wales’ (2015) 22 Torts Law Journal 250. Wardle J, ‘Defining Deviation: The Peer Professional Opinion Defence and Its Relationship to Scope Expansion and Emerging Non-Medical Health Professions’ (2016) 23 Journal of Law and Medicine 662.

1 2 3 4 5 6 7 8 9

10 11

See L Bender, ‘A Lawyer’s Primer on Feminist Theory and Tort’ (1988) 38 Journal of Legal Education 3, especially at 20–5, 30–2. Civil Law (Wrongs) Act 2002 (ACT) s 87. In South Australia, ‘members of the same profession’: see Civil Liability Act 1936 (SA) s 41(1). Civil Liability Act 2002 (NSW) s 5O(1); Civil Liability Act 1936 (SA) s 41(1); Civil Liability Act 2002 (Tas) s 22(1). Civil Liability Act 2003 (Qld) s 22(1); Wrongs Act 1958 (Vic) s 59(1). Civil Liability Act 2002 (NSW) s 5O(1); Civil Liability Act 2003 (Qld) s 20; Civil Liability Act 1936 (SA) s 41(1); Civil Liability Act 2002 (Tas) s 22(1); Wrongs Act 1958 (Vic) s 57. Civil Liability Act 2002 (WA) s 5PB(1). Civil Liability Act 2002 (WA) s 5PA. Civil Liability Act 2002 (NSW) s 5O(2); Civil Liability Act 2003 (Qld) s 22(2) (‘irrational or contrary to a written law’); Civil Liability Act 1936 (SA) s 41(2); Civil Liability Act 2002 (Tas) s 22(2). Wrongs Act 1958 (Vic) s 59(2). Civil Liability Act 2002 (WA) s 5PB(4).

12 13

14 15 16 17 18

19

20

21 22 23 24 25

26

27

28 29 30 31

32

Civil Liability Act 2002 (WA) s 5PB(6). Civil Liability Act 2002 (NSW) s 5P (‘risk of death of or injury to a person’); Civil Liability Act 2003 (Qld) s 22(5); Civil Liability Act 2002 (Tas) s 22(5); Wrongs Act 1958 (Vic) s 60 (‘a risk or other matter to a person’). Civil Liability Act 1936 (SA) s 41(5). Civil Liability Act 2002 (WA) s 5PB(2). Civil Liability Act 2003 (Qld) s 21. Civil Liability Act 2002 (Tas) s 21(2). See Civil Law (Wrongs) Act 2002 (ACT) s 43(1); Civil Liability Act 2002 (NSW) s 5B(1); Civil Liability Act 2003 (Qld) s 9(1); Civil Liability Act 1936 (SA) s 32(1); Civil Liability Act 2002 (Tas) s 11(1); Wrongs Act 1958 (Vic) s 48(1); Civil Liability Act 2002 (WA) s 5B(1) (where the focus is on being at ‘fault’ rather than ‘negligent’). See Civil Law (Wrongs) Act 2002 (ACT) s 43(2); Civil Liability Act 2002 (NSW) s 5B(2); Civil Liability Act 2003 (Qld) s 9(2); Civil Liability Act 1936 (SA) s 32(2); Civil Liability Act 2002 (Tas) s 11(2); Wrongs Act 1958 (Vic) s 48(2); Civil Liability Act 2002 (WA) s 5B(2) (where the focus is on being at ‘fault’ rather than ‘negligent’). Civil Law (Wrongs) Act 2002 (ACT) s 44(a), (b); Civil Liability Act 2002 (NSW) s 5C(a), (b); Civil Liability Act 2003 (Qld) s 10(a), (b); Civil Liability Act 2002 (Tas) ss 11(3), 12(a); Wrongs Act 1958 (Vic) s 49(a), (b). New South Wales Legislative Assembly, Hansard, 15 September 2005, p 17857. New South Wales Legislative Assembly, Hansard, 12 October 2005, pp 18516–18517. New South Wales Legislative Council, Hansard, 19 October 2005, p 18857. Quoting the New South Wales Police Minister, John Watkins, in ‘Paedophile to Keep Prison Bashing Compo’, The Age, 1 November 2007. Civil Law (Wrongs) Act 2002 (ACT) s 44(c); Civil Liability Act 2002 (NSW) s 5C(c); Civil Liability Act 2003 (Qld) s 10(c); Civil Liability Act 2002 (Tas) s 12(b); Wrongs Act 1958 (Vic) s 49(c). See B McDonald, ‘The Impact of the Civil Liability Legislation on Fundamental Policies and Principles of the Common Law of Negligence’ (2006) 14 Torts Law Journal 268 at 282. While these Acts are similar in intent, their scope and detail vary: Civil Law (Wrongs) Act 2002 (ACT) s 168; Civil Liability Act 1936 (SA) ss 19–22; Wrongs Act 1958 (Vic) ss 14A–14E; Occupiers’ Liability Act 1985 (WA). Civil Liability Act 2002 (NSW) s 49(1)(a); Civil Liability Act 2003 (Qld) s 46(1)(a). Civil Liability Act 2002 (NSW) s 49(1)(c); Civil Liability Act 2003 (Qld) s 46(1)(c). See Civil Liability Act 2002 (NSW) s 5I; Civil Liability Act 2003 (Qld) s 16; Civil Liability Act 1936 (SA) s 39; Wrongs Act 1958 (Vic) s 55. Civil Law (Wrongs) Act 2002 (ACT) ss 12–14; Civil Liability Act 2002 (NSW) ss 67–69; Personal Injuries (Liabilities and Damages) Act 2003 (NT) ss 11–13; Civil Liability Act 2003 (Qld) ss 68–72; Civil Liability Act 1936 (SA) s 75; Civil Liability Act 2002 (Tas) s 7; Wrongs Act 1958 (Vic) ss 14I–14L; Civil Liability Act 2002 (WA) ss 5AF–5AH. Civil Law (Wrongs) Act 2002 (ACT) s 14(c); Civil Liability Act 2002 (NSW) s 69(2); Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 13; Civil Liability Act 2003 (Qld) s 72; Civil Liability Act 2002 (Tas) s 7(2); Civil Liability Act 2002 (WA) s 5AH(2).

[page 183]

4 Causation: Factual Causation and Scope of Liability Objectives After completing this chapter, you should: — understand the fundamental principles underlying factual causation at common law; — understand the ways in which the civil liability statutory regimes operate; — understand how courts have addressed selected special issues associated with factual causation, including: — ‘material contribution’; — ‘exceptional cases’; — ‘loss of a chance’; — understand the ways in which ‘scope of liability’ principles operate under statutory regimes; — understand the fundamental common law principles underlying the phrase ‘scope of liability’; — understand how courts have addressed selected special issues associated with scope of liability, including: — —

new intervening acts; remoteness of harm.

[page 184]

Key cases — Adeels Palace Pty Ltd v Moubarak (2009) 239 CLR 420; 260 ALR 628 — Amaca Pty Ltd v Booth (2011) 246 CLR 36; 283 ALR 461 — Amaca Pty Ltd v Ellis (2010) 240 CLR 111; 263 ALR 576 — Chapman v Hearse (1961) 106 CLR 112 — Chappel v Hart (1998) 195 CLR 232; 156 ALR 517 — Haber v Walker [1963] VR 339 — Mahony v J Kruschich (Demolitions) Pty Ltd (1985) 156 CLR 522; 59 ALR 722 — Medlin v State Government Insurance Commission (1995) 182 CLR 1; 127 ALR 180 — Mount Isa Mines Ltd v Pusey (1970) 125 CLR 383; [1971] ALR 253 — Nader v Urban Transit Authority of New South Wales (1985) 2 NSWLR 501 — The Oropesa [1943] P 32 — Overseas Tankship (UK) Ltd v Morts Dock and Engineering Co Ltd (The Wagon Mound (No 1)) [1961] AC 388 — Rosenberg v Percival (2001) 205 CLR 434; 178 ALR 577 — Schellenberg v Tunnel Holdings Pty Ltd (2000) 200 CLR 121; 170 ALR 594 — Strong v Woolworths Ltd (2012) 246 CLR 182; 285 ALR 420 — Tabet v Gett (2010) 240 CLR 537; 265 ALR 227 — Wallace v Kam (2013) 250 CLR 375; 297 ALR 383

Key legislative developments

Most jurisdictions’ Civil Liability or Wrongs Acts prescribe: — the framework that must be used to consider causation issues, which is comprised of factual causation and scope of liability; — a ‘necessary condition’ test for factual causation; — that the burden of proof is placed on the plaintiff; — an evidentiary gap provision to address exceptional cases; — how to address cases where the causal consequence is dependent on what the plaintiff’s response would have been; — what underpins ‘scope of liability’: —

normative or policy considerations associated with new intervening acts;

—

normative or policy remoteness of harm.

considerations

associated

with

[page 185]

Introduction 4.1 Assuming that the plaintiff has proven that the defendant was negligent or careless, in breach of the defendant’s duty of care, the plaintiff must also prove that that negligence in fact caused the plaintiff’s injuries. At first sight, it may seem that this is a simple matter, one that can be determined by the application of ordinary common sense. Indeed, some judges had for some time tried to give this impression. For example, in Bennett v Minister for Community Welfare (1992) 176 CLR 408 at 412–13; 107 ALR 617 at 619, Mason CJ, Deane and Toohey JJ said: ‘In the realm of negligence, causation is essentially a question of fact, to be resolved as a matter of common sense.’ However, as you will see from the discussion that follows, even the concept of ‘common sense’ has come under a great deal of

criticism and disuse (although some judges in a few cases have referred to and employed it despite the criticism). Difficult causation issues arise in wide-ranging circumstances, ranging from what might appear to be relatively simple factual scenarios, to those that are scientifically and/or medically complex. Indeed, some cases require courts to assess what the plaintiff would have done had the breach not occurred — a difficult assessment of likely behavioural responses in a counter-factual, hypothetical situation. These issues will be explored throughout this chapter. 4.2 Every jurisdiction except the Northern Territory has enacted legislation prescribing how courts must approach the causation inquiry. The following framework, from the New South Wales Civil Liability Act 2002 ss 5D–5E, is similar in general terms to other jurisdictions’ enactments. However, some differences do exist. For example, not every jurisdiction includes a section similar to s 5D(3) (b). These differences will be noted where they are particularly relevant, as they arise throughout this chapter:1 5D General principles (1) A determination that negligence caused particular harm comprises the following elements: (a) that the negligence was a necessary condition of the occurrence of the harm (factual causation), and (b) that it is appropriate for the scope of the negligent person’s liability to extend to the harm so caused (scope of liability). (2) In determining in an exceptional case, in accordance with established principles, whether negligence that cannot be established as a necessary condition of the occurrence of harm should be accepted as establishing factual causation, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party.

[page 186] (3) If it is relevant to the determination of factual causation to determine what the person who suffered harm would have done if the negligent person had not been negligent: (a) the matter is to be determined subjectively in the light of all relevant

circumstances, subject to paragraph (b), and (b) any statement made by the person after suffering the harm about what he or she would have done is inadmissible except to the extent (if any) that the statement is against his or her interest. (4) For the purpose of determining the scope of liability, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party. 5E Onus of proof In proceedings relating to liability for negligence, the plaintiff always bears the onus of proving, on the balance of probabilities, any fact relevant to the issue of causation.

Ipp JA, the author of the report that led to the introduction of the statutory changes affecting the law of torts (see 2.13), has said that the principles embodied in this statutory causation test are ‘in accord with the common law’: see Ruddock v Taylor (2003) 58 NSWLR 269 at [89] (reversed on other grounds (2005) 222 CLR 612; 221 ALR 32). In fact, the approach that has been adopted in the legislation is very much influenced by the work of Professor Stapleton (see ‘Further reading’). What is clear is that in all jurisdictions except the Northern Territory, it is now necessary to use the relevant, governing statutory provisions rather than the common law when commencing causation inquiries. The statutory framework calls for the need to direct attention to discrete, separate questions in causal determinations. However, the content of the sections may be informed by previous decisions. And, like many statutory provisions, they are also the subject of ongoing interpretation by the courts. Commenting on the New South Wales statute, in Zanner v Zanner (2010) 79 NSWLR 702, Allsop P (Young JA concurring) stated (at [11]): ‘The requirement to follow s 5D is clear. What its statutory content is and the extent of any continuity with developing common law concepts awaits judicial elucidation.’ 4.3 As was noted above, many causation cases with which the High Court of Australia has had to grapple raise complex evidentiary issues — such as those involving exposure to asbestos. By way of contrast, the High Court has also had to consider cases that are noteworthy for their simplicity in factual terms, which nevertheless raise thorny issues of causation. One such leading case, Strong v Woolworths Ltd (2012)

247 CLR 182; 285 ALR 420, involved a person who suffered a serious injury from slipping and falling. It raises issues concerning the ‘necessary condition’ requirement under the Civil Liability Act 2002 (NSW), the role of ‘material contribution’ under the civil liability statutes and the relevance of policy. It is instructive and fascinating to note how a case that arose from such a relatively commonplace scenario, an evidentiary world away from the complexities of exposure to asbestos, can give rise to a legal decision of such enormity. [page 187] Key Case Strong v Woolworths Ltd (2012) 247 CLR 182; 285 ALR 420 Facts: The plaintiff slipped and fell outside a Big W store operated by the defendant, when one of her crutches made contact with a greasy chip on the ground. Her fall occurred at approximately 12:30 pm on the day concerned. As a result of the fall, the plaintiff suffered a serious injury to her spine. On the day of the fall, Woolworths did not have an adequate system in place for periodic cleaning or inspection of the sidewalk area outside the Big W store. A reasonable response to the risk, which was reasonably foreseeable, would have been an inspection every 15–20 minutes. Issue: Did the defendant’s negligent failure to maintain a cleaning system for the sidewalk cause the plaintiff’s fall? Decision: By a majority of four to one, the High Court of Australia overturned the decision of the New South Wales Court of Appeal and found that there was a causal link between the defendant’s negligent failure to implement a cleaning system and the harm to the plaintiff as a result of her fall. Specifically, the court found that it was open on the evidence to conclude that the chip had been on the ground long enough for it to have been cleaned up, had there had been a reasonable periodic cleaning system in place. See also 4.11, 4.21. The majority, comprised of French CJ, Gummow, Crennan and Bell JJ, made the following observations about what is required to establish factual causation (at [18]– [19]): The determination of factual causation under s 5D(1)(a) is a statutory statement of the ‘but for’ test of causation: the plaintiff would not have suffered the particular harm but for the defendant’s negligence. While the value of that test as a negative criterion of causation has long been recognised, two kinds of limitations have been identified. First, it produces anomalous results in particular cases,

exemplified by those in which there is more than one sufficient condition of the plaintiff’s harm. Second, it does not address the policy considerations that are bound up in the attribution of legal responsibility for harm. The division of the causal determination under the statute into the distinct elements of factual causation and scope of liability is in line with the recommendations in the Final Report of the Committee convened to review the law of negligence (the Ipp Report). The authors of the Ipp Report acknowledged their debt to Professor Stapleton’s analysis in this respect. The policy considerations that inform the judgment of whether legal responsibility should attach to the defendant’s conduct are the subject of the discrete ‘scope of liability’ inquiry. In a case such as the present, the scope of liability determination presents little difficulty. If the appellant can prove factual causation, it is not in contention that it is appropriate that the scope of Woolworths’ liability extend to the harm that she suffered. In particular cases, the requirement to address scope of liability as a separate element may be thought to promote clearer articulation of the policy considerations that bear on the determination. Whether the statutory determination may produce a different conclusion to the conclusion yielded by the common law is not a question which is raised by the facts of this appeal.

[page 188] The distinct differences between factual causation and scope of liability were again articulated and highlighted by the High Court of Australia in Wallace v Kam (2013) 250 CLR 375; 297 ALR 383 at [11]– [12], [14] (see 4.26, 4.34): The common law of negligence requires determination of causation for the purpose of attributing legal responsibility. Such a determination inevitably involves two questions: a question of historical fact as to how particular harm occurred; and a normative question as to whether legal responsibility for that particular harm occurring in that way should be attributed to a particular person. The distinct nature of those two questions has tended, by and large, to be overlooked in the articulation of the common law. In particular, the application of the first question, and the existence of the second, have been obscured by traditional expressions of causation for the purposes of the common law of negligence in the conclusory language of ‘directness’, ‘reality’, ‘effectiveness’ and ‘proximity’. Statute now requires that the two questions be kept distinct. … The distinction now drawn by s 5D(1) [of the Civil Liability Act 2002 (NSW)] between factual causation and scope of liability should not be obscured by judicial glosses. A determination in accordance with s 5D(1)(a) that negligence was a necessary condition of the occurrence of harm is entirely factual, turning on proof by

the plaintiff of relevant facts on the balance of probabilities in accordance with s 5E. A determination in accordance with s 5D(1)(b) that it is appropriate for the scope of the negligent person’s liability to extend to the harm so caused is entirely normative, turning in accordance with s 5D(4) on consideration by a court of (among other relevant things) whether or not, and if so why, responsibility for the harm should be imposed on the negligent party.

Despite the emphatic statements of the High Court of Australia in Wallace v Kam, in Paul v Cooke [2013] NSWCA 311 (see 4.4, 4.19), Leeming JA of the New South Wales Court of Appeal expressed reservations about a strict delineation between factual causation and scope of liability, stating (at [110]): ‘It would be most surprising if scope of liability, which is central to establishing the limits of negligence, was confined to purely normative considerations.’ In King v Western Sydney Local Health Network [2013] NSWCA 162 (see 4.22), Basten JA similarly asserted his view (at [34]) that ‘questions of factual causation and scope of liability, as separately identified in s 5D, do not readily fall into separate and independent watertight compartments’. Despite Basten JA’s comments, this chapter follows the statutory framework and the rationale for that structure, as explained by the High Court of Australia in Wallace v Kam. The inquiry into ‘factual causation’ is considered in the first part of this chapter. Arguably, in many circumstances, there will be little, if any, substantial difference in outcome when applying this first limb of the statutory framework when compared to the common law. The inquiry into ‘scope of liability’, which clearly raises what the High Court in Wallace v Kam and Ipp JA called a ‘normative question’ (see also Ruddock v Taylor (2003) 58 NSWLR 269 at [87]; Harvey v PD (2004) 59 NSWLR 639 at [225]), is explored in the second part of this chapter. [page 189]

Factual Causation

Necessary condition/‘but for’ test 4.4 Essential features of factual causation were considered by the High Court of Australia in Wallace v Kam (see 4.26), where (at [15]) the High Court endorsed the observations of Allsop P of the New South Wales Court of Appeal in the instant case: [T]he task involved in s 5D(1)(a) is the elucidation of the factual connection between the negligence (the relevant breach of the relevant duty) and the occurrence of the particular harm. That task should not incorporate policy or value judgments, whether referred to as ‘proximate cause’ or whether dictated by a rule that the factual enquiry should be limited by the relationship between the scope of the risk and what occurred. Such considerations naturally fall within the scope of liability analysis in s 5D(1)(b), if s 5D(1)(a) is satisfied, or in s 5D(2), if it is not.

The High Court continued (at [16]): The determination of factual causation in accordance with s 5D(1)(a) involves nothing more or less than the application of a ‘but for’ test of causation. That is to say, a determination in accordance with s 5D(1)(a) that negligence was a necessary condition of the occurrence of harm is nothing more or less than a determination on the balance of probabilities that the harm that in fact occurred would not have occurred absent the negligence.

As was the case with employing a strict framework delineating factual causation from scope of liability and the latter’s normative underpinnings, not every judge has agreed with the High Court’s assertion in Wallace v Kam that values play no role in the determination of factual causation. For example, in Paul v Cooke (see 4.3, 4.19), Basten JA of the New South Wales Court of Appeal stated, obiter (at [11]), ‘the determination of “factual causation” is not a value-free activity undertaken without reference to context’. The role of value judgments in factual causation determinations had been considered prior to the decision in Wallace v Kam. By way of illustration, in Monaghan Surveyors Pty Ltd v Stratford Glen-Avon Pty Ltd [2012] NSWCA 94, Basten JA (McColl and Young JJA agreeing) of the New South Wales Court of Appeal observed (at [69]): Factual causation … identifies a relationship between conduct and consequence which is not necessarily free of normative considerations. … On one view, normative elements cannot be entirely expunged from a ‘counter-factual inquiry’ in determining whether the conduct was a necessary condition of the occurrence of harm.

However, in a manner more in sync with the later High Court

decision in Wallace v Kam, the New South Wales Court of Appeal also stated (at [69]) that the scope of liability provisions, s 5D(1)(b) and (2) of the Civil Liability Act 2002 (NSW), ‘were intended to cover factors variously described as “value judgments”, “normative considerations” or “legal policy”’. [page 190] 4.5 As the High Court states, the assessment of factual causation commences with the ‘but for’ test. In general terms, this is not unlike the ‘necessary condition’ test mandated under the statutory regimes. This test may be simply stated: would the plaintiff’s injuries have been suffered but for the defendant’s negligence? Would the plaintiff have been injured even if the defendant had not been negligent? If the answer is ‘yes’, the defendant’s negligence does not satisfy factual causation. Put another way, one should now ask: ‘was the defendant’s breach a necessary condition of the plaintiff’s harm?’ The following case illustrates the way in which the traditional ‘but for’ test operates. Case Example Barnett v Chelsea and Kensington Hospital Management Committee [1969] 1 QB 428 Facts: The plaintiff’s husband fell ill at work one night after drinking tea. He went to the casualty department of the defendant’s hospital, but the duty doctor was not there, because he was at home, ill. The nurse telephoned the duty doctor, describing the plaintiff’s husband’s symptoms. The doctor told the nurse to tell the man to go home to bed, and to call his own doctor. The nurse did this, and the plaintiff’s husband left the hospital. About five hours later, the plaintiff’s husband died. The tea had been poisoned with arsenic. Issue: Did the defendant hospital’s negligence cause the plaintiff’s husband’s death? Decision: Nield J had little difficulty in finding that the duty doctor had been negligent in not coming to the casualty department to make his diagnosis. However, he went on to hold that the plaintiff had failed to prove that that negligence had caused her husband’s death. The evidence established that if the duty doctor had got up, dressed, then come to the hospital and correctly diagnosed the problem, the plaintiff’s husband could not have been given the required treatment for arsenic poisoning (an intravenous drip) until about four hours after he had first appeared at the hospital. One of the expert witnesses

said that even if this had been done, ‘the chances of survival were not good’ (at 438). Accordingly, Nield J said (at 433–4): [T]he plaintiff … has failed to establish, on the balance of probabilities, that the death of the deceased … resulted from the negligence of the defendants … my view being that had all care been taken, still the deceased must have died.

The ‘but for’ test requires the court to compare what actually happened with what might, hypothetically, have happened. Unlike a scientist’s use of a control experiment, where a reaction with a particular variable is compared to a reaction without that variable, the ‘but for’ test does not compare like with like. The court compares what actually happened with what would probably have happened if what actually happened had not happened. For example, in Fitzpatrick v Job (t/as Jobs Engineering) (2007) Aust Torts Reports ¶81-891; [2007] WASCA 63 at [219], Buss JA (with whom Steytler P agreed) said: [page 191] The issue of causation requires a plaintiff to prove what would probably have eventuated had the defendant’s negligence not occurred. This is necessarily a hypothetical question and involves an evaluation of circumstances which did not in fact happen.

Because the court is making a comparison with a hypothetical, it cannot (or should not) state a definite conclusion. Nevertheless, there is a seductive simplicity about the ‘but for’ test. The simple question, ‘Would the plaintiff’s injuries have been suffered but for the defendant’s negligence?’, seems to require a simple answer: ‘Yes’ or ‘No’. Yet, it is impossible to say that in Barnett’s case, Barnett would have died even if the hospital had taken reasonable care; one can only say that he probably would have died. Because a court in a civil case need only be sure of anything on the balance of probabilities, the court treats the answer ‘Probably yes’ as ‘Yes’, and ‘Probably no’ as ‘No’ (see the comments of Gaudron J in Bennett v Minister for Community Welfare (at CLR 422–3; ALR 627). What is important to recognise is

that the analysis that leads to the answer requires a consideration of probabilities. This is considered in the leading cases, Adeels Palace Pty Ltd v Moubarak (2009) 239 CLR 420; 260 ALR 628 (see 4.8, 4.21) and Strong v Woolworths Ltd (see 4.3, 4.11, 4.21). The ‘but for’ test as a negativing (or screening) mechanism 4.6 The ‘but for’ test is better at identifying what is not a cause than it is at identifying what is the cause of an accident. For example, consider the following situation. Let’s say that one of us (Martin or Ian) decides to drive to the local shopping centre, even though the brakes on my car do not work properly. While my car is stationary at a red traffic light, a semi-trailer careers out of control and smashes into my car because its driver has just had a stroke. It was negligent of me to drive my car with faulty brakes, but that was not a cause of the accident, as the accident would almost certainly have occurred even if my brakes had been working properly, because my car’s braking capacity had nothing to do with the collision. It was not a ‘necessary condition’ of the resultant harm. In contrast, the accident would not have happened if I had not decided to drive to the shopping centre, as I would not have been sitting in the path of the semi-trailer when it veered off course. However, it seems most odd to say that my decision to go shopping was the cause of the accident. The sensible answer to the question of what caused the accident would be that it was caused by the semi-trailer driver suffering a stroke. My decision to go shopping was a cause, but not the cause. Although this seems to be correct, the ‘but for’ test provides no assistance in explaining why this is so. The test is better at distinguishing between something that is a cause, like the semi-trailer driver’s stroke, and something that is not a cause, like the faulty brakes on my car, than it is at distinguishing between the significance of things that are rather ‘historical’ causes, such as my decision to go shopping and the semi-trailer driver’s stroke. As was noted previously, the use of ‘common sense’ as a defensible

or justifiable tool to resolve difficult factual causation questions has been the subject of a [page 192] great deal of judicial (and academic) criticism. However, as we noted, despite that criticism, on occasion it has been considered or employed. For example, the High Court of Australia referred to it in Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; 296 ALR 3 at [43], in which contribution and apportionment issues were considered (see 14.44): ‘Causation is largely a question of fact, to be approached by applying common sense to the facts of the particular case.’ The approach used in Strong v Woolworths Ltd (see 4.3, 4.11, 4.21) as well as this statement were applied in Takla v Nasr [2013] NSWCA 435, involving a solicitor’s professional negligence and Lucantonio v Stichter [2014] NSWCA 5, where the New South Wales Court of Appeal held that causation had not been established in the context of professional negligence in managing a trust property. Tabet v Gett (2010) 240 CLR 537; 265 ALR 227, a medical negligence case decided under common law principles, explored whether or not ‘loss of a chance of a better outcome’ was damage (proving a causal connection to harm as a possibility as opposed to proving it as a probability) (see 4.14 and 4.24). Kiefel J stated (at [112]): The ‘but for’ test is regarded as having an important role in the resolution of the issue of causation, although more as a negative criterion than as a comprehensive test. The resolution of the question of causation has been said to involve the common sense idea of one matter being the cause of another. But it is also necessary to understand the purpose for making an inquiry about causation and that may require value judgments and policy choices.

Despite these disparate comments, the more widely held view that ought to be employed in resolving factual causation issues is that they should not be resolved by using common sense and should not involve the use of policy considerations. The latter should only be employed in rare circumstances: see 4.18–4.22.

4.7 Because the ‘but for’ test is only useful for excluding possible causes, the High Court of Australia has stated that the test is of limited usefulness in ultimately determining whether the defendant’s negligence caused the plaintiff’s injuries. In what had been a leading case for a number of years, March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; 99 ALR 423, the defendant had parked a truck in the middle of the road, for the purpose of loading it with bins containing fruit and vegetables. The truck had its rear and hazard lights on. The plaintiff, who was drunk, drove his car into the back of the truck. He suffered injuries in the collision. The court had to consider whether or not the plaintiff’s injuries were caused by the defendant’s negligence in parking the truck in the middle of the road. The trial judge found that the defendant had been negligent but that the plaintiff had also been negligent, apportioning liability 30 per cent to the defendant, 70 per cent to the plaintiff. (On apportionment of liability, see Chapter 10.) The High Court agreed with the trial judge’s decision, holding that the defendant’s negligence in parking the truck in the middle of the road did have some causative effect. Mason CJ (with whom Toohey and Gaudron JJ agreed) stated (at CLR 515–16; ALR 430–1): [T]he ‘but for’ test, applied as a negative criterion of causation, has an important role to play in the resolution of the question [of causation] … The commentators acknowledge that the ‘but for’ test must be applied subject to certain qualifications.

[page 193] Thus, a factor which secures the presence of the plaintiff at the place where and at the time when he or she is injured is not causally connected with the injury, unless the risk of the accident occurring at that time was greater … In truth, the application of the test proves to be either inadequate or troublesome in various situations in which there are multiple acts or events leading to the plaintiff’s injury … The cases demonstrate the lesson of experience, namely, that the test, applied as an exclusive criterion of causation, yields unacceptable results and that the results which it yields must be tempered by the making of value judgments and the infusion of policy considerations.

It is this latter point, involving the use of policy in the ‘but for’ context, that has been the target of criticism (see 4.4). However, see

also 4.18–4.22, where the legislature and courts have determined that certain categories of exceptional cases referred to by Mason CJ should allow for the explicit use of value judgments, even though they concern factual causation.

‘Necessary condition’ under the Acts 4.8 In Cox v New South Wales (2007) Aust Torts Reports ¶81-888; [2007] NSWSC 471 at [154], Simpson J said of para (a) of the statute: ‘This, to my mind, is no more than a statutory formulation of the “but for” test that is familiar in tort law: see, for example, March v E & MH Stramare Pty Ltd … .’ The causation provisions and statutory framework prescribed by the New South Wales Civil Liability Act 2002 were considered explicitly by the High Court of Australia in the following leading case, in which the court also had occasion to comment on aspects of March’s case. Key Case Adeels Palace Pty Ltd v Moubarak (2009) 239 CLR 420; 260 ALR 628 Facts: The defendant, Adeels Palace, ran a restaurant and reception business, which was licensed to serve alcohol. On New Year’s Eve, the restaurant was full, having reached its limited seating capacity of over 280 patrons. Early the next morning, a dispute and then fight occurred, involving punching and the throwing of chairs, plates and bottles. One man, who was hit in the face, left the premises, returning with a gun. In response to someone calling out, ‘gun, gun, run away’, Mr Bou Najem (one of the respondents on appeal) ran into the kitchen, then slipped. He was followed by the gunman, who pointed the gun at him. Despite his plea to not be shot, the gunman shot him, wounding him in the leg. The gunman left the kitchen, went back into the restaurant and found Mr Moubarak (the other respondent on appeal). Moubarak was the person who had earlier hit the gunman in the face. The gunman shot Moubarak in the stomach. He then left the premises. Issue: Was the restaurant and reception centre causally responsible for the harm suffered by the plaintiffs, by not providing sufficient security personnel during the New Year’s Eve function? [page 194] Decision: The High Court held in favour of the restaurant. It found a duty of care,

distinguishing Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; 176 ALR 411 (see 6.22) on duty arguments involving third-party conduct. However, even though it did not outright reject the lower court’s findings on breach, it was unconvinced by them. Most importantly, in terms of precedential value, the High Court explored causation issues, with particular attention paid to the statute’s ‘necessary condition’ requirement. French CJ, Gummow, Hayne, Heydon and Crennan JJ observed (at [41]– [45]): The first point to make about the question of causation is that … it is governed by the Civil Liability Act. Section 5D(1) … divides the determination of whether negligence caused particular harm into two elements: factual causation and scope of liability. Dividing the issue of causation in this way expresses the relevant questions in a way that may differ from what was said by Mason CJ, in March … to be the common law’s approach to causation. The references … in March … to causation being ‘ultimately a matter of common sense’ were evidently intended to disapprove the proposition ‘that value judgment has, or should have, no part to play in resolving causation as an issue of fact’. By contrast, s 5D(1) treats factual causation and scope of liability as separate and distinct issues. It is not necessary to examine whether or to what extent the approach to causation described in March … might lead to a conclusion about factual causation different from the conclusion that should be reached by applying s 5D(1). It is sufficient to observe that, in cases where the Civil Liability Act or equivalent statutes are engaged, it is the applicable statutory provision that must be applied. Next it is necessary to observe that the first of the two elements identified in s 5D(1) (factual causation) is determined by the ‘but for’ test: but for the negligent act or omission, would the harm have occurred? The court unanimously concluded that even if it accepted the lower court’s negligence finding, this carelessness was not a cause of the plaintiffs’ injuries. The court reasoned that although security personnel ‘may have’ been able to deter or prevent the gunman or other would-be assailants entering the premises, there was no evidence that allowed for the conclusion that having security staff at the entrance ‘would have’ had this effect. Indeed, the facts showed that the gunman was willing to use his gun indiscriminately; there was no evidence that he would have exercised rational judgment. The court stated (at [49]–[50], [53], [57]): Nor did the evidence show that security personnel could or would have prevented re-entry by the gunman: a determined person armed with a gun and irrationally bent on revenge. … Recognising that changing any of the circumstances in which the shootings occurred might have made a difference does not prove factual causation. Providing security at the entrance of the restaurant might have delayed the gunman’s entry; it might have meant that, if Mr Bou Najem was a random victim … someone else might have been shot and not

him. But neither plaintiff proved factual causation by pointing to possibilities that might have eventuated if circumstances had been different. … In the present case … the ‘but for’ test of factual causation was not established. It was not shown to be more probable than not that, but for the absence of security personnel … the shootings would not have taken place. That is, the absence of security personnel at Adeels Palace on the night the plaintiffs were shot was not a necessary condition of their being shot. … [page 195] As in Modbury, the event which caused the plaintiffs’ injuries was deliberate criminal wrongdoing, and the wrongdoing occurred despite society devoting its resources to deterring and preventing it … That being so, it should not be accepted that negligence which was not a necessary condition of the injury that resulted from a third person’s criminal wrongdoing was a cause of that injury. Accordingly, the submission that the plaintiffs’ injuries … were caused by the failure of Adeels Palace to take steps that might have made their occurrence less likely, should be rejected.

Explicit (and implicit) application of Adeels Palace and the Civil Liability Acts’ framework(s) — some examples 4.9 Adeels Palace Pty Ltd v Moubarak and the Civil Liability Acts’ frameworks have been applied expressly (and sometimes implicitly) many times. A number of examples follow. •

Jovanovski v Billbergia Pty Ltd [2010] NSWSC 211: the plaintiff, a trucker who had been bullied by another trucker over a lengthy period of time, faced similar causal proof problems as those that confronted the plaintiffs in Adeels Palace. Both truckers worked as contractors with the defendant. Several months after an incident in which the plaintiff was punched, his truck’s door handle was covered in grease. One week later, grease was again placed under the door handle. It was also smeared over the steps behind the driver’s cabin. Although these incidents were reported to the defendant’s supervisor, no action was taken. The conduct was repeated. The plaintiff’s accident occurred when he slipped on the top step of the truck’s tailgate ladder, falling two metres onto the rocky ground, and seriously injuring himself. The duty to provide a

safe system of work, including proper supervision of the worksite, was clear. In a somewhat curious comment, the trial judge, Davies J, stated that it would have been asking too much of the defendant employer to have expected him to prevent the first incident, because ‘practical jokes and pranks’ occur in worksite contexts. Although he acknowledged a safety issue existed at that point, he refused to find a breach. He did, however, find a breach with respect to the later incidents, where safety issues were particularly serious: workers should have been warned that this type of behaviour was inappropriate and unsafe and that sanctions could be imposed. The claim failed because causation could not, in the court’s view, be proven. The court could not conclude that the defendant’s breach was a ‘necessary condition of the occurrence of the harm’. For reasons similar to those canvassed in Adeels Palace, the court held that in a case like this, with a third party committing voluntary and intentional acts, that person may have ignored warnings and threats. While a warning and threat might have deterred or prevented the harm by changing the third party’s conduct, this mere inference was one of many possibilities, including the continuation of the conduct. Indeed, a warning might have encouraged the third party to act more carefully to avoid detection. •

Al Mousawy v Howitt-Stevens Construction Pty Ltd [2010] NSWSC 122: Hoeben J of the New South Wales Supreme Court held that the plaintiff, injured by a hotel’s [page 196] collapsed ceiling, failed in his claim against the structural engineering company (and others) for failing to identify ceiling defects in a report it issued a few months previously. Although duty of care and breach were not established, the court went on to hold that the evidence did not show that the hotel owners would have acted on advice from the engineer or that vibration experts

would have discovered the ceiling problems. The claim against the hotel also failed because there was insufficient evidence to prove the necessary causal sequence of events. •

Cox v Fellows [2013] NSWCA 206: the court referred to and applied Adeels Palace in the context of a negligently performed procedure to remove the respondent’s gall bladder.

•

Zanner v Zanner (2010) 79 NSWLR 702: an 11-year-old child, with his mother’s permission, drove her car three or four metres in order to park it in the family carport. When his foot slipped from the brake onto the accelerator, he drove into his mother, who was standing in front of the vehicle. On four or five previous occasions, he had driven his father’s car into and out of the carport, with his father sitting beside him in the passenger seat. Although standard of care issues involving the relevance of inexperience and expected competence were canvassed (see 3.6), causation questions were central. The child defendant (in fact, the vehicle’s insurer) argued that his mother’s conduct was the sole cause of her harm, because she created the situation of risk by placing the child in control of the car, without accompanying him. Following Adeels Palace, Tobias JA (Young JA concurring) observed that causation determinations must commence with the words of the statute and the ‘necessary condition’ requirement. The court also considered whether there can be more than one cause of harm (see 4.17) as well as ‘scope of liability’ normative considerations (see 4.34).

•

Perisher Blue Pty Ltd v Harris [2013] NSWCA 38: the plaintiff was injured at the defendant’s ski resort after ‘failing to negotiate’ a ditch on the beginners’ ski slope. The New South Wales Court of Appeal applied Adeels Palace and Strong. Sackville AJA found that the defendant’s failure to erect a barrier, to fill the ditch with snow, or to move the location of the beginners’ lesson were each a cause of the plaintiff’s harm (at [21]–[27]). In particular, his Honour noted that even though the evidence about the effectiveness of a barrier was ‘sketchy’, it was still open to the court to infer that a barrier or warning would have enabled the plaintiff to avoid the

ditch (at [27]). Young AJA (Beazley JA agreeing) also found that the failure to take these steps was not what a reasonable person would have done in the circumstances (at [98]) and held that the trial judge was correct to find that causation had been established (at [109]). •

Blundell v Leighton [2013] ACTCA 1: Penfold, Burns and Buchanan JJ, of the Supreme Court of the Australian Capital Territory, Court of Appeal, restated the statutory test for causation as outlined in Adeels Palace. It noted (at [56]) that although the trial judge had referred to March and did not refer to the Territory’s statutory framework for causation, this did ‘not distract attention’ from the trial judge’s finding. In their Honours’ view, the trial judge had given [page 197] appropriate consideration to the question of whether the negligence here was a ‘necessary condition of the harm’ — the gist of the statutory requirement.

•

Uniting Church in Australia Property Trust (NSW) v Miller; Miller v Lithgow City Council (2015) 91 NSWLR 752; 212 LGERA 230; [2015] NSWCA 320: the 12-year-old respondent, during swimming training, slipped while diving into the shallow end of a swimming pool managed by the council, hit the pool bottom and fractured her neck, rendering her a tetraplegic. The New South Wales Court of Appeal affirmed the primary judge’s finding in favour of the council, rejecting the plaintiff’s contention that the council was negligent in failing to prohibit all dives into the shallow end and permitting diving when no qualified coach was present to supervise. However, the appeal court reversed the primary judge’s findings against the school. Leeming JA (Basten and Simpson JJA agreeing) held (at [141]) that: (i) the plaintiff had not proven that she would have ‘been able in a fraction of a second to reduce her

velocity to a safe level’; (ii) ‘there was no sound basis for the primary judge to conclude that the different shape or surface of the coping tile would have altered the trajectory or speed of the Ms Miller’s fall sufficiently to avoid a collision with the bottom of the pool once her rear foot had slipped’ (at [153]); (iii) a risk assessment of the council pool would not have produced a different result (at [162]). The court also considered classification of harm issues, relevant to remoteness considerations, embraced by the scope of liability inquiry: see 4.58. •

Lyons v Fletcher (2014) 66 MVR 219; [2014] NSWCA 67: early in the morning, the plaintiff, Ms Lyons, was struck by a car driven by the defendant, Mr Fletcher, after climbing over the barrier that separated the pedestrian walkway and the road. She was drug affected and wearing dark clothes. She alleged that the driver was negligent because he failed to pay sufficient attention to the road ahead and failed to have his high beams illuminated. The New South Wales Court of Appeal was divided with respect to whether the content of his duty extended to illuminating his high beams. However, the court was unanimous in holding that his conduct did not cause the accident. Emmett JA (Macfarlan and Gleeson JJA agreeing) noted (at [58]–[59]: There can be no real doubt that, if Ms Lyons was jogging across Gunnedah Road, as the trial judge found, Mr Fletcher would not have had time to see her and avoid hitting her, even if he had his high beam headlights illuminated. It follows that the trial judge did not err in concluding that there was no causal connection between any breach of duty on the part of Mr Fletcher and the injury to Ms Lyons. That is to say, the injury would not have been avoided, even if there had been no breach of duty.

•

Nepean Blue Mountains Local Health District v Starkey [2016] NSWCA 114: a nurse facilitator slipped and fell while walking towards the basin in the hospital’s staff toilets, suffering severe injury. She successfully sued the hospital. Because the primary judge failed to refer to the Civil Liability Act 2002 (NSW), the decision-making process was challenged as one that had miscarried due to

[page 198] this fundamental omission. The New South Wales Court of Appeal (McColl JA, Garlin J and Payne JA) dismissed the appeal. The court held that the primary judge was justified in omitting reference to the legislation because the appellant had framed the issues so narrowly. However, McColl JA emphasised (at [6]) that ‘this case should not be seen as a general licence to trial judges, let alone counsel, not to refer to that legislation’. According to her Honour (at [15]): ‘Failure to determine a case in accordance with the CLA may vitiate a judgment if that failure is material to the outcome. … It cannot, however, be said that it cannot be a basis for denying appellate intervention in an appropriate case.’ •

Swift v Wearing-Smith [2016] NSWCA 38: the respondent was injured when he fell from a balcony on the appellants’ premises, because a glass panel gave way. The primary judge held that the appellants were negligent by giving the respondent access to the balcony when they had a pre-purchase report indicating corrosion. The majority of the New South Wales Court of Appeal (Hoeben JA, Meagher JA agreeing) held (at [107]) that proof of causation failed: [T]he evidence … goes no further than identifying the failure of the bolts as a possible mechanism for the accident. For it to reach the level of being a probable cause, the assumptions upon which it was based had to be made out and they were not. There was no evidence that the bolts were in fact rusty.

Applying Vairy v Wyong Shire Council, their Honours held (at [117]) that the primary judge had erred by not conducting a ‘prospective inquiry’. Simpson JA dissented, stating (at [234]) that it was reasonably foreseeable that normal use of the balustrade might result in its breaking, and observing (at [238]) that ‘[i]t must be emphasised that the precautions upon which [the primary judge] relied did not necessarily extend to heroic engineering repairs; entertaining guests in another part of the premises was a viable alternative (although, perhaps, not so appealing to the owners of an attractive balcony)’.

The following case, which applied Adeels Palace, is a particularly distressing scenario in which the need to avoid speculation arose as a central issue. Case Example Jausnik v Nominal Defendant (No 5) (2016) 78 MVR 1; [2016] ACTSC 306 Facts: While conducting random breath testing, Jausnik, a New South Wales police officer, observed a speeding vehicle. He and his partner, Hannaford, who was driving the police vehicle, commenced pursuit — at times travelling between 140 and 150 km per hour. The pursuit took place over approximately 4.7 km and involved the vehicles crossing from New South Wales into the Australian Capital Territory. While the relevant policing guidelines indicated that cross-border pursuits require approval by the Australian Federal Police (AFP), neither officer had received training in how to operate the newly installed radio system to give effect to this. The pursuit ended when the speeding vehicle ran through a red light and collided at high speed with another car, killing its driver, his partner and their infant son. The driver of the speeding car, [page 199] Williams, who it was later discovered had a blood alcohol reading of 0.154 per cent, subsequently died in hospital. Jausnik attempted to render first aid to the vehicles’ occupants and in doing so sustained a psychiatric injury — chronic post-traumatic stress disorder and major depression (noted at [8]). Because the speeding vehicle was unregistered, Jausnik claimed against the Nominal Defendant. The Nominal Defendant sought contribution from Hannaford and the state of New South Wales. Issue: Was the failure to obtain authorisation from the AFP to continue the pursuit a necessary condition of the crash? Decision: Mossop AsJ noted that the claim was for pure mental harm, holding (at [112]) that a negligent driver should reasonably foresee that ‘a police officer of normal fortitude, attending the scene of an accident caused by the driver involving the death and injury caused in the present case, might suffer mental harm’. His Honour held that the duty owed by Hannaford to Jausnik was breached when Hannaford continued to pursue the speeding vehicle in circumstances where no contact had been made with the AFP and when the danger of its continuation clearly outweighed the need to pursue the vehicle. The state was negligent for failing to ensure that officers were able to use the newly installed radio system to communicate with the AFP and failing to provide sufficient training regarding the circumstances in which it was appropriate to continue a cross-border pursuit. Establishing causation involved a consideration of the hypothetical instructions Hannaford would have received had he made contact with the AFP at the start of the pursuit. Having considered two possible scenarios, the court held (at [171]) that the

relevant sergeant, the AFP pursuit controller on duty at the time, would have requested more information about the surrounding circumstances before terminating the pursuit and that this would have taken 30 to 60 seconds. The central question (at [174]) was ‘whether or not it can be said on the balance of probabilities that the collision would have been avoided’. This involved the hypothetical termination of the pursuit 1.6 km prior to the crash site. His Honour concluded that this reasoning, leading to this conclusion, involved an impermissible degree of speculation. Noting that the speeding driver was heavily intoxicated and driving in a particularly reckless manner, his Honour cited Modbury Triangle Shopping Centre Pty Ltd v Anzil (at [182]) in support of the proposition that ‘[r]easoning based on “common sense” is dangerous when assessing criminal conduct’. The problem with speculative reasoning was elaborated upon (at [184]): [I]t is not possible to safely reach any conclusion as to Mr Williams’ behaviour following a cessation of the pursuit. Slowing down, travelling at the same speed or speeding up were all actions that Mr Williams might have taken if the pursuit had been ended prior to the Hindmarsh Drive intersection. Applying Adeels Palace Pty Ltd v Moubarak, his Honour ultimately concluded (at [186]) that, ‘had there not been a breach of duty by the State or Mr Hannaford, then the collision might have been avoided, but I cannot be satisfied of that on the balance of probabilities’ (emphasis in original). Neither the state nor Mr Hannaford were persons ‘who [are] liable for the same damage’. Therefore, the claim by the Nominal Defendant against the third parties seeking contribution did not succeed, because factual causation (‘necessary condition’) could not be established on a balance of probabilities.

[page 200]

Probability, proof and inference 4.10 Every application of the ‘but for’ test involves an evaluation of what probably would have happened if the defendant had not been negligent, and a comparison of that situation with what actually happened. The evaluative aspects of the ‘but for’ test are hidden when the test is applied in its simple form, as in Barnett v Chelsea and Kensington Hospital Management Committee (see 4.5). The evaluative aspects of the ‘but for’ test can be made more explicit by emphasising its relationship with the onus of proof on the balance of probabilities. With respect to these requirements, the legislation referred to in 4.2 states (in general terms):2

In deciding liability for negligence, the plaintiff always bears the burden of proving, on the balance of probabilities, any fact relevant to the issue of causation.

To understand the role of probabilities, it may be worthwhile being more explicit than is often the case, by asking how likely it was that the plaintiff would have suffered the injury in question even if the defendant had not been negligent rather than asking whether the plaintiff would have been injured even if the defendant had not been negligent. First, imagine what would have happened if the defendant had not been negligent. Then ask: ‘Is it more likely than not that the plaintiff would have suffered the same injury anyway?’ If the answer is ‘Yes’, then, on the balance of probabilities, the defendant’s negligence was not the cause of the injuries. If the answer is ‘No’, then, on the balance of probabilities, the defendant’s negligence was the cause of the injuries. Focusing on the balance of probabilities also helps to explain why ‘a factor which secures the presence of the plaintiff at the place where and at the time when he or she is injured is not causally connected with the injury’, to quote Mason CJ in March v E & MH Stramare Pty Ltd (at CLR 516; ALR 430) (see 4.7). ‘Securing the plaintiff’s presence’ is not the effective cause on the balance of probabilities. Of course, it is always possible that the plaintiff might have been injured if the defendant had not been negligent. The world can be a dangerous place and it is always possible that an injury might occur at any time. Nevertheless, the defendant cannot simply argue that the plaintiff might have suffered some injury even if he or she (the defendant) had not been negligent. Note that the statutory test quoted in 4.2 focuses the court’s attention on the ‘particular harm’ suffered by the plaintiff. 4.11 In Strong v Woolworths Ltd, where the court considered proof issues in the context of the fallen chip and a failed cleaning system, the majority rejected the defendant’s submission that the plaintiff needed to prove the time at which the chip fell on the ground, which was impossible on the evidence, and instead found that the plaintiff was required to prove the following, on the balance of probabilities (at [32]): … Woolworths’ negligence was a necessary condition of her harm. Woolworths’

negligence lay in its failure to employ a system for the periodic inspection and

[page 201] cleaning of the sidewalk sales area. Proof of the causal link between an omission and an occurrence requires consideration of the probable course of events had the omission not occurred. Here, the appellant was required to prove that, had a system of periodic inspection and cleaning of the sidewalk sales area been employed on the day of her fall, it is likely that the chip would have been detected and removed before she approached the entrance to Big W.

The High Court concluded (at [34]): It was incumbent on the appellant to prove that it was more probable than not that Woolworths’ negligence was a necessary condition of her fall, but this onus could be discharged by consideration of the probabilities in circumstances in which the evidence did not establish when the chip was deposited.

4.12 Facts may be proved by direct evidence or by inference from direct evidence. For example, if I hear a loud noise in the next room, and I walk in to see X lying bleeding on the floor, and Y holding a smoking gun, it may be inferred that Y has just shot X. This conclusion is drawn from the facts that I have witnessed, and about which I may give evidence, but it is not in itself established by direct evidence. There may be several other hypotheses that are consistent with the primary facts. For example, Y may just have taken the smoking gun from X’s hand after X had committed suicide. If a court is to infer, on the balance of probabilities, that Y shot X, it must be satisfied that the shooting hypothesis is more probable than the hypothesis that X committed suicide, given the nature of the primary facts established by evidence. Thus, proof by inference depends on probabilities in a way that proof by direct evidence does not. Nevertheless, proof by inference is just as acceptable as proof by direct evidence. 4.13 The relationship between proof, hypothesis, inference and probability was considered in the unanimous decision of the High Court of Australia in Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 at 5–6: Of course, as far as logical consistency goes, many hypotheses may be put which the

evidence does not exclude positively. But this is a civil and not a criminal case. We are concerned with probabilities, not with possibilities. The difference between the criminal standard of proof in its application to circumstantial evidence and the civil is that in the former the facts must be such as to exclude reasonable hypotheses consistent with innocence, while in the latter you need only circumstances raising a more probable inference in favour of what is alleged. In questions of this sort, where direct proof is not available, it is enough if the circumstances appearing in the evidence give rise to a reasonable and direct inference: they must do more than give rise to conflicting inferences of equal degrees of probability so that the choice between them is a mere matter of conjecture … But if circumstances are proved in which it is reasonable to find a balance of probabilities in favour of the conclusion sought then, though the conclusion may fall short of certainty, it is not to be regarded as mere conjecture or surmise … All that is necessary is that according to the course of common experience the more probable inference from the circumstances that sufficiently appear by evidence or admission, left unexplained, should be that the injury arose from the defendant’s negligence. By more probable is meant no more than that upon a balance of probabilities such an inference might reasonably be considered to have some greater degree of likelihood.

[page 202] It is clear from Bradshaw’s case that, although proof by inference is acceptable, inference differs from conjecture. Proof on the balance of probabilities requires more than a choice between ‘conflicting inferences of equal degrees of probability’. Bradshaw v McEwans Pty Ltd has been quoted in the High Court of Australia on a number of occasions (despite the fact that it had been an unreported decision for a number of years), particularly when the court is forced to take an approach based on probabilities, because of the lack of direct evidence: see Luxton v Vines (1952) 85 CLR 352; Holloway v McFeeters (1956) 94 CLR 470; Jones v Dunkel (1959) 101 CLR 298; Girlock (Sales) Pty Ltd v Hurrell (1982) 149 CLR 155; 40 ALR 45. The court is forced to take a more rigorous probability-based approach where there is little or no direct evidence. 4.14 A number of the cases considered in 4.9 as explicit (or implicit) applications of Adeels Palace and the statutory frameworks also could have been included at this point. Additional examples follow:

•

Roads and Traffic Authority v Royal (2008) 245 ALR 653: although the High Court of Australia decided this case using common law principles because the Civil Liability Act 2002 (NSW) was not yet in force, it is nonetheless relevant in general terms for what it says about conjecture. In this case the defendant driver carelessly struck the plaintiff’s vehicle near an intersection where a road met the Pacific Highway. The Roads and Traffic Authority (another defendant) was held to be in breach because it had been aware of previous crashes at that intersection, a ‘known danger’, where one car could mask the visibility of another. It had not installed a stop sign to improve drivers’ vision or built a staggered T-intersection. The majority held that ‘masking’ visibility played no role as a cause in this accident. Gummow, Hayne and Heydon JJ emphasised that the ‘but for’ test should not be used as a comprehensive test of causation, stating (at [25], [29]): The problem or danger or risk was that where two vehicles were approaching in adjoining lanes, one might obscure the other. That did not happen in this case. … [E]ven if it could be said that the … breach of duty ‘did materially contribute’ to the occurrence of an accident, ‘by creating a heightened risk of such an accident’ due to the obscuring effect of one vehicle on another in an adjoining lane, it made no contribution to the occurrence of this accident. … … The defendant and the plaintiff were each in a position to see the other in more than sufficient time for each of them to avoid the collision. The design of the cross-intersection was thus irrelevant to the cause of the accident.

In a separate majority judgment Kiefel J (at [144]–[145]) highlighted the need to avoid conjecture: The present state of authority does not accept the possibility of risk of injury as sufficient to prove causation. It requires that the risk eventuate. Kitto J in [Jones v Dunkel] said that one ‘does not pass from the realm of conjecture into the realm of inference’ unless the facts enable a positive finding as to the existence of a specific state of affairs. …

[page 203] … The evidence did not show that the design of the intersection contributed to the accident. It is not sufficient to suggest that there was a statistical possibility of

an accident at the intersection because it was not the best design. … The accident was caused by driver error.

As Royal demonstrates, close attention to the facts of the particular case is essential to determining whether or not the breach at issue is a necessary condition of the harm. Guesswork and conjecture are no substitutes for proof on a balance of probabilities, which in some instances may involve legitimate inferences derived from established facts. •

Brown v Hewson [2015] NSWCA 393: the three-and-a-half year old respondent was injured when he fell or jumped from a balance beam at the appellants’ childcare centre. He fractured his left elbow and sustained a head injury, which he alleged was the cause of ongoing headaches and behavioural problems. Because his case was brought sixteen years after the accident it was determined under common law principles. Two breaches were alleged: (i) the respondent was allowed to climb the balance beam with his shoes on the wrong feet; (ii) the balance beam was placed at a height exceeding prescribed regulations. Sackville AJA (Macfarlan JA agreeing) of the New South Wales Court of Appeal affirmed the primary judge’s conclusion that the appellants had breached their duty of care with respect to the shoes being on the wrong feet. With respect to this breach and causation, Sackville AJA (Adamson J agreeing) held that causation could only be established if the respondent fell, rather than jumped, as only falling could be attributed to wearing footwear incorrectly. Because the evidence supported a finding of jumping, causation was not established. Macfarlan JA dissented (at [11]) on this point, holding that the evidence was ‘consistent with the plaintiff having jumped from the beam in an unbalanced and unco-ordinated fashion as a result of his incorrect footwear and/or with him landing awkwardly for the same reason’. Only Sackville AJA held that the appellants had been negligent with respect to the height of the beam. Macfarlan JA and Adamson J disagreed, observing that although non-compliance with

standards can be evidence of negligence, it is not conclusive of such a finding. Regarding this breach and causation, Sackville AJA held (at [108]) that on the instant facts, ‘an inference is available that the appellants’ breach of duty materially contributed to the Plaintiff’s injuries’. However, Adamson J (Macfarlan J agreeing) held otherwise (at [155]), stating ‘it is a matter of common experience that bones can fracture as a result of a fall to the ground, even where there is no additional elevation. In these circumstances, a court is not entitled to draw an inference of material contribution from an arguable (but unquantified) increase in risk’. The split decision produced an unusual result: Macfarlan J found breach and causation established with respect to the shoes; Sackville AJA found breach and causation established with respect to the height of the balance beam; Adamson J dissented, as she did not find both elements proven with respect to either instance of alleged negligence. [page 204] •

Perisher Blue Pty Ltd v Nair-Smith (2015) 320 ALR 235; 90 NSWLR 1; 295 FLR 153; [2015] NSWCA 90: the difficulties in establishing causation is illustrated in this case, where the New South Wales Court of Appeal (Barrett, Gleeson JJA and Tobias AJA) held (at [163]) that various explanations did ‘no more than suggest competing inferences of equal degrees of probability so that any choice among them is no more than speculation’. This case involved the respondent and two skiing companions who were waiting to board a chairlift operated by the appellant. As an empty chair approached the bullwheel on its descent, they noticed that its safety bar was down, which would dangerously prohibit their boarding if not raised before arriving at their position. The attendant was not paying attention to the descending chairs. The respondent and her companions called out to attract his attention

and he raised the bar of the chair just in time for their boarding. However, the respondent had become misaligned and was struck from behind by the chair’s armrest. Ultimately, the respondent was unable to establish, on the evidence, a connection between the breach and her harm as there were a number of possible reasons for the respondent’s misalignment with the chair. As the court held (at [163]), the various explanations did ‘no more than suggest competing inferences of equal degrees of probability so that any choice among them is no more than speculation’. An application for special leave to appeal to the High Court was denied (S89/2015). •

Langmaid v Dobsons Vegetable Machinery Pty Ltd (2014) 24 Tas R 18; [2014] Aust Torts Reports ¶82-177; [2014] TASFC 6: a major fire occurred in the early morning at industrial premises where the appellants had been carrying on a business (the purchase, grading, sale and storage of potatoes). During the previous afternoon, the respondent’s employees had been working on the premises, modifying equipment by cutting, grinding and welding metal. The appellants contended that the fire resulted from the respondent’s employees’ ‘hot work’, involving sparks and spattering of hot metal and failure to comply with relevant regulations. The Tasmanian Supreme Court, Full Court (comprised of Blow CJ, Porter and Pearce JJ) unanimously held that the respondent had breached its duty of care, statutory duty and implied contractual terms. However, the court was divided with respect to the question of causation. Porter J held in favour of the appellant, on the basis of drawing a legitimate inference as opposed to ‘mere speculation … a matter of choosing between guesses’ (at [149)]. Pearce J agreed with Porter J and referred to French CJ’s comments in Amaca Pty Ltd v Booth (at [172]): An after-the-event inference of causal connection may be reached on the civil standard of proof, namely, balance of probabilities, notwithstanding that the statistical correlation between the first event and the second event indicated, prospectively, no more than a ‘mere possibility’ or ‘real chance’ that the second event would occur given the first event [emphasis added].

Blow CJ dissented, stating (at [26]) that ‘[h]aving regard to the

various possibilities and the evidence relating to them, I am not satisfied on the balance of probabilities that the fire was caused or contributed to by the respondent’s [page 205] hot work’. His Honour held that the evidence did not support the inference of a causal relationship. The court also considered remoteness principles: see 4.56. •

Downes v Affinity Health Pty Ltd [2016] QCA 129: a registered nurse claimed to have aggravated a spinal condition in the course of intercepting an elderly post-operative patient who was trying to get out of bed. The defendant’s breach was the failure to provide this patient with a bed that had full-length side rails. At issue was whether her injury occurred while she was she putting the patient back onto the bed or from adjusting her position after doing so? The Supreme Court of Queensland, Court of Appeal (Morrison JA, Holmes CJ agreeing, Philip McMurdo JA dissenting) held against the appellant on the conflicting evidence. The majority concluded (at [114]) that no breach had been shown to be causative of the harm. Only the former scenario (putting the patient back onto the bed) could support a causation finding given that repositioning the patient would have been required even if a rail were present).

•

Larsen v Grace Worldwide (Australia) Pty Ltd [2016] NSWCA 251: the unrepresented appellants failed to establish factual causation because the evidence was too thin. The appellants’ furniture and other goods were transported by the respondent to their house in Germany. The appellants developed health problems, including skin cancers and breathing difficulties, which they alleged were from their ‘Welsh dresser’ being contaminated with a tar-like substance. The New South Wales Court of Appeal (Macfarlan JA, McColl and Basten JJA agreeing) held (at [19]) that the appellants did not discharge the ‘onus of proving that the goods were

damaged whilst in the respondent’s possession’, affirming the primary judge’s conclusion that different possibilities led to the contamination: (i) the substance was on the dresser before the goods were shipped; (ii) the substance may have been placed on the dresser after delivery in Germany during building renovations. The court also held (at [31]) that the expert evidence ‘at its highest, merely suggested that having physical contact with the tar-like substance, or contact with an article that had itself been in contact with the substance, might have caused a person to have an adverse health reaction’. Further, there was no evidence of an article being placed on the dresser and Mrs Larsen, one of the appellants, never had direct contact with the substance. •

Moama Bowling Club Ltd v Thomson Group Pty Ltd [2014] VSCA 245: agreeing with the trial judge, the Victorian Supreme Court, Court of Appeal, comprised of Nettle, Tate and Beach JJA, was not prepared to hold that the fire at the appellant’s premises was caused by the explosion of one of two tungsten halogen lamps fitted in two floodlights by the respondent, an electrical contractor. The evidence disclosed little more than two alternative plausible, but conflicting, inferences regarding the fire’s origins, both of which were equally probable.

•

Jackson v McDonald’s Australia Ltd [2014] NSWCA 162: the plaintiff was injured when he fell on the stairs in a McDonald’s restaurant; the floor had been mopped a short time beforehand. Although the opinion of the New South Wales Court of Appeal was divided with respect to a breach finding, their Honours [page 206]

were unanimous with respect to causation. On this issue, Barrett JA stated (at [112]) (McColl and Ward JJA agreeing) that causation could only be established if ‘there was water on the soles [of the appellant’s] shoes when he fell; and, secondly, that that presence of that water

caused him to fall’. The court held (at [119]) that causation had not been proven: [T]here is nothing in common experience that tells us that someone with wet shoes who traverses a floor having the particular characteristics of the McDonald’s floor is more likely to slip because of water on their shoes than for any other reason, such as inattention (because engaged in conversation or for any other reason), excessive speed or failing to take advantage of a handrail. People wearing dry shoes walk on wet stairs every day and do not slip. People wearing wet shoes walk on dry stairs every day and do not slip. People wearing dry shoes slip on dry stairs every day. And, as Heydon JA observed in Wilkinson v Law Courts Ltd [2001] NSWCA 196 at [32], stairs are, in any event, ‘inherently, but obviously, dangerous’.

Barrett JA also observed (at [122]) that the appellant had failed to call expert evidence regarding the likely state of his soles after they had traversed the wet area: [The appellant] chose to leave an evidentiary vacuum on the issue of, first, the extent to which soles of the particular kind, having encountered wetness on the floor surface, were likely still to be wet at the time of his fall and, second, the propensity of soles of the particular kind, if wet, to cause slipping to a greater degree than if dry when traversing surfaces of the particular kinds.

See 11.27, where this case is considered under ‘obvious risk’. In Tabet v Gett, a significant High Court of Australia decision noted elsewhere (see 4.6, 4.24), Kiefel J embraced the traditional approach to causation to assess loss or damage (at [111]–[113], [145]): The common law requires proof, by the person seeking compensation, that the negligent act or omission caused the loss or injury constituting the damage. All that is necessary is that, according to the course of common experience, the more probable inference appearing from the evidence is that a defendant’s negligence caused the injury or harm. ‘More probable’ means no more than that, upon a balance of probabilities, such an inference might reasonably be considered to have some greater degree of likelihood; it does not require certainty. … Once causation is proved to the general standard, the common law treats what is shown to have occurred as certain. The purpose of proof at law, unlike science or philosophy, is to apportion legal responsibility. That requires the courts, by a judgment, to ‘reduce to legal certainty questions to which no other conclusive answer can be given’. The result of this approach is that when loss or damage is proved to have been caused by a defendant’s act or omission, a plaintiff recovers the entire loss (the ‘all or nothing’ rule). … The general standard of proof required by the common law and applied to causation

is relatively low. It does not require certainty or precision. It requires that a judge be persuaded that something was probably a cause of the harm the plaintiff suffered. …

These issues are considered further at 4.24, as are the facts of the case. [page 207]

‘Material contribution’ 4.15 Several cases have stated that to establish factual causation, the plaintiff must prove that the defendant’s negligence caused or materially contributed to the harm that she or he has suffered. The appropriateness of this test has come under scrutiny in a variety of contexts, including those involving the development of disease (frequently dust-related). In the much-discussed case, Bonnington Castings v Wardlaw [1956] AC 613, the employee’s lung disease was the result of a gradual buildup of silica particles inhaled over several years, from both a carelessly maintained grinder (for which there was a breach by his employer) and a pneumatic hammer (for which there was no breach). The largest proportion of dust came from the legally blameless hammer and only a small amount came from the legally blameworthy grinder. The House of Lords had to determine if the dust from the grinder was a cause of the disease. In this landmark, frequently cited decision, the House of Lords held that the employer’s negligence ‘materially contributed’ to the employee’s harm, as the dust inhaled from the faulty source, the grinder, was not a negligible amount. Important factors influencing the reasoning and result included the fact that the development of the disease required an accumulation of silica particles over time and did not involve more than one toxic agent from different sources. Bonnington Castings was considered by the High Court of Australia in the following case involving complex evidentiary matters. Key Case

Amaca Pty Ltd v Ellis (2010) 240 CLR 111; 263 ALR 576 Facts: Mr Cotton was negligently exposed to respirable asbestos fibres by more than one defendant, having worked in unsafe conditions with unsafe products. Mr Cotton died of lung cancer. He had smoked 15–20 cigarettes per day for more than 26 years. Issue: Was the executor of Paul Cotton’s estate able to prove that it was more probable than not that the workplace negligence was a cause of the deceased employee’s lung cancer? Or was his smoking the cause of his cancer? Decision: Deciding this case under common law doctrine, the High Court of Australia observed that both smoking and the inhalation of asbestos fibres could cause lung cancer, and no medical assessment could determine why the deceased developed the disease. On the facts, studies of large populations (epidemiological studies) could not assign a probability greater than 23 per cent to the contention that Mr Cotton’s lung cancer was attributable to the asbestos exposure. The evidence pointed to the probability that smoking was the sole cause of the cancer; this was assessed as at least 67 per cent. The High Court of Australia held that the plaintiff’s case failed, because the breach cannot merely be a possible cause; it must be a probable cause. The relative risks of sustaining lung cancer due to smoking were much greater than that which could [page 208] be attributable to asbestos exposure. On the evidence, because Mr Cotton, the deceased, was a smoker, the plaintiff had not established that it was more probable than not that the asbestos exposure was a cause — or necessary condition — of the cancer. The court also noted that it had to consider the case against each defendant, as to whether or not its negligence was a cause of the harm. French CJ, Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ stated (at [6], [10]–[14]): The courts’ response to uncertainty arising from the absence of knowledge must be different from that of the medical practitioner or scientist. … The central question was whether it had been shown to be more probable than not that exposure to asbestos was a cause of Mr Cotton’s death. More particularly, in each case, had it been shown to be more probable than not that the negligence of the defendant in question was a cause of Mr Cotton contracting lung cancer? … The plaintiff expressly disavowed any argument in these appeals that demonstrating only that the exposure to asbestos increased the risk of contracting lung cancer was sufficient to establish causation. It was the plaintiff’s case … that she could succeed only if she showed that Mr Cotton’s exposure to asbestos had caused or contributed to (in the sense of being a necessary condition for) his developing lung cancer. …

Causation was not established … against any defendant. The evidence did not establish facts which positively suggested that it was more probable than not that the negligence of any defendant was a cause of Mr Cotton’s cancer. … [N]o more was established than that, although exposure to asbestos may have been a cause of his cancer, it was not a probable cause. The High Court of Australia held that the question of material contribution, considered in Bonnington Castings v Wardlaw, did not arise here, as no actual connection between asbestos exposure and his cancer had been established on a balance of probabilities. The court stated (at [65]): It was not shown that exposure to asbestos made a material contribution to his cancer. Material contribution was not shown because a connection between Mr Cotton’s inhaling asbestos and his developing cancer was not demonstrated. Distinguishing Bonnington Castings, their Honours observed (at [68]): The issue in Bonnington Castings was whether one source of an injurious substance contributed to a gradual accumulation of dust that resulted in disease. The issue here is whether one substance that can cause injury did cause injury. … Questions of material contribution arise only if a connection between Mr Cotton’s inhaling asbestos and his developing cancer was established. Knowing that inhaling asbestos can cause cancer does not entail that in this case it probably did. … [T]hat inference was not to be drawn in this case. Questions of what is a material contribution do not arise.

This case starkly highlights the causal proof difficulties faced by individuals who have suffered lung diseases, where they have histories of smoking and exposure to asbestos. The difficulties presented by the need to establish sufficient scientific proof on a balance of probabilities should not be understated nor underestimated. As we have seen, the difference between proving that exposure to asbestos can cause lung cancer in a case where smoking has occurred over a long period and proving that this exposure to asbestos has indeed caused that person’s lung cancer can be enormous — and insurmountable. The upshot of a case like this is that the [page 209] legal wrong that has undeniably been suffered by a claimant can go

uncompensated, in the absence of being able to establish the causal link in a factual sense, as a ‘necessary condition’ of the harm. In CSR Ltd v Amaca Pty Ltd [2016] VSCA 320, the Supreme Court of Victoria, Court of Appeal (comprised of Maxwell P, Beach and Kaye JJA) emphasised (at [154]) a ‘trite’ point: that ‘each case must be treated on its own evidence’. The court continued, stating (at [154]) that ‘Amaca v Ellis is not authority for the proposition that, where a smoker who has been exposed to asbestos develops lung cancer, that smoker can never establish that the exposure to asbestos was a cause of the lung cancer’. Their Honours distinguished Ellis factually, noting that the ‘critical’ expert in Ellis was unwilling to recognise a causal relationship, whereas the opposite was true in the instant case, where Mr Johnstone was described by the trial judge (and whose description is cited by the appeal court at [151]) as ‘a long standing but light cigarette smoker all his life’. The appeal court observed (at [158]) that ‘“[c]ertainty” is not the relevant standard for the determination of whether a particular exposure can be said to be a cause of injury’. See also Evans v Queanbeyan City Council at evidence yielded a different determination.

4.16, 4.21

where different

4.16 Some of the difficulties arising from the use of epidemiological studies and statistics were further considered in the following cases. Case Example Merck Sharp & Dohme (Australia) Pty Ltd v Peterson (2011) 196 FCR 145; 284 ALR 1 Facts: See 1.22. Issue: Was the consumption of Vioxx a necessary condition of Mr Peterson’s heart attack? Decision: With respect to causation, Keane CJ, Bennett and Gordon JJ of the Federal Court of Australia unanimously concluded that the respondent was not liable for Mr Peterson’s heart attack (at [104]). The court noted (at [86]) that he had a number of risk factors, including hypertension, obesity (although he had lost some weight), as well as being over 51 years of age, male and a former smoker. Having cited Amaca Pty Ltd v Ellis and issues associated with the use of epidemiological studies, the court observed (at [113]):

In this case, as has been seen, there was a clear basis for concluding that Mr Peterson does indeed stand apart from the ordinary case. His personal circumstances were such that they afford a ready explanation for the occurrence of his injury independent of the possible effects of Vioxx. The strength of the epidemiological evidence as a strand in the cable of circumstantial proof is seriously diminished by this consideration. The epidemiological studies do not provide assistance in resolving the question whether it was the risk posed by Vioxx, either alone or in combination with the other candidates, which did eventuate in this case. The court described the ‘but for’ test as ‘deeply rooted in the policy of the common law’ and observed (at [104]) that it is not open to the Federal Court to depart from [page 210] this rule. The court applied Tabet v Gett (2010) 240 CLR 537; 265 ALR 227 and followed Allsop P’s summary of the state of Australian law (at [102]). Allsop P had stated in Evans v Queanbeyan City Council [2011] NSWCA 230 at [22]: Subject to the views of the High Court in respect of any development of the common law or to the operation of any legislation, it can be concluded that at common law, as a general proposition, the increasing of risk of harm by a tortious act is, alone, insufficient for a conclusion of causation by material contribution to harm or for a conclusion of responsibility in law for that harm. Applying Allsop P’s approach to the facts of the case, the court held (at [104]): This Court must proceed on the footing that for Mr Peterson to show that the consumption of Vioxx materially contributed to his [myocardial infarction], in the sense relevant in Australian law, he is obliged to show that his consumption of Vioxx was a necessary condition for the occurrence of the heart attack on 8 December 2003. To say that the consumption of Vioxx was, for example, ‘in the mix’ of possible causes is not enough in this regard. Issues arising under the s 75AC action are noted at 1.22.

Key Case Amaca Pty Ltd v Booth (2011) 246 CLR 36; 283 ALR 461 Facts: An 81-year-old was diagnosed with mesothelioma, as a result of exposure to asbestos (i) as a child, on two limited occasions in a domestic context; (ii) as a worker loading bags of asbestos fibres on the wharves for 20 minutes, one day in 1959; and (iii)

as a motor mechanic working for 30 years with brake linings and products manufactured by the defendants in each of two appeals (nine years with Amaca Pty Ltd’s (‘Amaca’) products and 19 years with Amaba Pty Ltd’s (‘Amaba’) products). Curtis J, the trial judge at the Dust Diseases Tribunal, found that ‘70 per cent of the asbestos fibres to which Mr Booth was exposed’ came from Amaca and Amaba’s products. Issue: Was it more probable than not that the negligence of Amaca and Amaba were each causes of Mr Booth’s contraction of mesothelioma? Decision: By a majority of four to one, the High Court of Australia affirmed the decision of the Supreme Court of New South Wales and found that the negligence of both Amaca and Amaba were causes of Mr Booth’s disease. The majority (Gummow, Hayne and Crennan JJ) described the ‘but for’ test as ‘troublesome in various situations in which multiple acts or events led to the plaintiff’s injury’ (at [70]). Their Honours cited the joint reasons of the High Court in Amaca v Ellis (at [67]) as saying that the question in Bonnington Castings Ltd v Wardlaw was not ‘what was the most probable source of the pursuer’s disease’ but instead ‘whether dust from the poorly maintained equipment was a cause of his disease’ (emphasis in original) (at [70]). Their Honours distinguished Amaca v Ellis, noting (at [71]) that Ellis involved heavy, longterm smoking as the cause of the claimant’s disease. This complicating fact [page 211] was not at issue in Mr Booth’s case, where ‘exposure to asbestos [was] effectively the only known cause of mesothelioma’ (at [71]). French CJ affirmed that ‘[c]ausation in tort is not established merely because the allegedly tortious act or omission increased a risk of injury’ (at [41]). His Honour went on to observe (at [43]): The existence of an association or a positive statistical correlation between the occurrence of one event and the subsequent occurrence of another may be expressed as a possibility, which may be no greater than a ‘real chance’ that, if the first event occurs, the second event will also occur. The mere existence of such an association or correlation does not justify a statement, relevant to factual causation in law, that the first event ‘creates’ or ‘gives rise to’ or ‘increases’ the probability that the second event will occur. Such a statement contains an assumption that if the second event occurs it will have some causal connection to the first. However, if the association between two events is shown to have a causal explanation, then the conclusion may be open, if the second event should occur, that the first event has been at least a contributing cause of that occurrence. An after-the-event inference of causal connection may be reached on the civil standard of proof, namely, balance of probabilities, notwithstanding that the statistical correlation between the first event and the second event indicated, prospectively, no more than a ‘mere possibility’ or ‘real chance’ that the second event would occur given the first event. There may of course be cases in which the strength of the association, as measured by relative risk ratios, itself supports an inference of a causal connection.

The majority also remarked on the state of medical and scientific knowledge in relation to mesothelioma. Specifically, the case concerned knowledge about the level of exposure to asbestos that would be sufficient to result in a person developing mesothelioma. The judgment of the majority (at [80]–[82]) and that of French CJ (at [52]) distinguished the approach in Fairchild v Glenhaven Funeral Services Ltd [2003] 1 AC 32 (see 4.18) and noted that the evidentiary foundation for Amaca’s and Amaba’s cases was different to that in Fairchild.

In Amaca Pty Ltd v Tullipan [2014] NSWCA 269, the respondent alleged that he suffered from asbestosis because he inhaled asbestos dust from products manufactured by the appellant. The appellant argued that the respondent suffered from idiopathic pulmonary fibrosis, which could not be attributed to his asbestos exposure. The Dust Diseases Tribunal held in the respondent’s favour because he had lived with his condition for much longer than the typical survival period of those with idiopathic pulmonary fibrosis. Basten, Gleeson and Leeming JJA of the New South Wales Court of Appeal unanimously dismissed Amaca’s appeal. Leeming JA commented on this chilling reasoning (at [56]): The differential survival rates (or mortality rates) are not by themselves sufficient to establish causation. It is necessary also to have regard to the relative frequency of the two diseases. Let it be assumed that disease A is highly likely to kill within 10 years, and disease B is highly unlikely to kill within 10 years. If disease A is extremely common throughout the population, and disease B is extremely rare, it would be unsafe to conclude from the different survival rates per se that a person suffering from one of those diseases who has survived for 10 years is suffering from disease B.

[page 212] According to the court (at [57]) the evidence showed the following: [T]he relative frequencies of asbestosis and idiopathic pulmonary fibrosis in 2013 were not so disproportionate as to detract from the significance of the different mortality rates. (Whether this will continue to be true into the future is an open question; the literature suggested that the incidence of asbestosis was declining and likely to continue to do so, while the incidence of idiopathic pulmonary fibrosis was increasing.)

The four appellants in Hayes v Queensland [2016] QCA 191 worked in

the respondent’s Disability Services office, involved in the management of residential care officers who provided services to vulnerable people with significant intellectual disabilities who were living in the community. A number of residential care officers made a series of complaints against the appellants, including harassment. The respondent investigated but found the complaints were unsubstantiated. Following the complaints, each appellant suffered from a serious psychiatric injury and brought an action in negligence against the state for failing to provide sufficient support at the time of the complaints and during the investigation. McMurdo P (Mullins and Dalton JJ agreeing) of the Supreme Court of Queensland, Court of Appeal distinguished this case (at [7]) from New South Wales v Paige (2002) 60 NSWLR 371; [2002] NSWCA 235 (concerning mental harm) and Sullivan v Moody (2001) 207 CLR 562 (concerning duty of care), stating that the issues here were not only about the conduct of the investigation or decision making, but the lack of support during the investigation (and the need to provide a safe workplace environment). Among other issues, the court was divided with respect to whether the breaches had caused the appellants’ psychiatric injuries. The fact that their injuries had multiple antecedents was not in dispute. However, only McMurdo P, dissenting, held that the respondent’s breaches made a material contribution to the harm suffered (at [36], [57], [74] and [90]). Her Honour based her determination (at [36]) on Bonnington Castings and the comments of Gummow, Hayne and Crennan JJ in Amaca Pty Ltd v Booth: ‘This breach of duty was itself a real, material and not negligible cause.’ Dalton JA (Mullins JA agreeing) disagreed, stating with respect to one of the appellants, by way of example (at [196]), it would be ‘unsafe’ to find causation established on the strength of the evidence. 4.17 As was noted above, the High Court of Australia did not cast doubt on the correctness of Bonnington Castings; rather, it was distinguished. In Strong v Woolworths Ltd, the High Court had occasion to consider another meaning attributed to the phrase ‘material contribution’. The High Court referred to the Ipp Report, which noted how this phrase can be used to encapsulate what is at issue in an

‘exceptional case’, in which an ‘evidentiary gap’ exists, with Bonnington Castings and Fairchild cited as two different types of ‘gap’ cases (see 4.18). (Some commentators argue that Bonnington Castings is not exceptional as the ‘guilty’ dust was a ‘necessary condition’ to producing the lung disease.) The High Court of Australia observed in Strong that the case did not raise any difficult evidentiary gap issues. Rather, it was a typical case in which necessary condition causation had to be proven on a balance of probabilities. While this can be difficult to establish, as [page 213] it was in that case, the difficulties in Strong did not stem from assessing complex scientific evidence, which might be lacking (as in cases like Ellis). Importantly, the High Court in Strong expressed the long-held proposition that the defendant’s breach need not be the sole necessary condition of the plaintiff’s harm. Similarly, in Zanner v Zanner (see 4.9), Allsop P (Young JA concurring) explained, in obiter, that more than one cause can be said to contribute materially to the harm, for example, where one person drives carelessly (far too quickly, exceeding the speed limit), colliding with another careless driver (who is inattentive). Both breaches are necessary to materially contribute to the harm. The following case examples illustrate, in a distressing, all-toocommon context, how the defendant’s negligence need not be the only or sole cause of harm to satisfy the but for/necessary condition requirement. Case Example Cox v New South Wales (2007) Aust Torts Reports ¶81-888; [2007] NSWSC 471 Facts: The plaintiff suffered profound and enduring psychological problems as a result

of being bullied persistently by a fellow pupil at a primary school run by the defendant. Issue: Was the school’s carelessness a necessary condition of the plaintiff’s psychological harm? Decision: The Supreme Court of New South Wales held that the defendant owed and had breached a duty to restrain the bullying child (see Chapter 6 for a consideration of affirmative duties to control others) and so would be liable for the psychological harm suffered by the plaintiff (see Chapter 9 for a consideration of psychological harm) if there was a causal connection between the defendant’s failure to control the bully and the plaintiff’s psychological condition. Relying on the statutory causation test (Civil Liability Act 2002 (NSW) s 5D(1)), the defendant argued that its negligence was not a ‘necessary condition’ of the plaintiff’s harm because he might well have suffered psychological problems in any event, because both of his parents had a history of depression. The defendant argued that ‘the true cause of his current condition is to be found in either or both of his genetic history and the (unintentionally) malign influence of his mother’: at [120] per Simpson J. In a case decided prior to Strong, Simpson J rejected that argument, saying (at [153]–[155]): [T]he question relevant to causation is not whether or not the plaintiff would, in other circumstances and at some other time, have succumbed to his vulnerability and suffered some other psychiatric disorder. … What s 5D is directed to is the ‘particular harm’ suffered by the plaintiff; and whether the negligence established was a necessary condition for the occurrence of that harm. … The ‘particular harm’ suffered by the plaintiff was the condition or conditions variously described by the psychiatric witnesses, as ‘Separation Anxiety Disorder’, ‘Post-Traumatic Stress Disorder’, and Depression. Having regard to the chain of events, and the evidence … I am satisfied that the negligence established was indeed a necessary condition of the occurrence of that harm. It is not essential, for the purposes of s 5D, that the negligence established the sole cause of the ‘particular harm’.

[page 214] Case Example Oyston v St Patrick’s College (No 2) [2013] NSWCA 310 Facts: The plaintiff, a student at the defendant college, was regularly and continuously bullied by classmates. The college was aware of the complaints of bullying but failed to take reasonable steps to protect the student from the bullying. The college was also

aware that the plaintiff had suffered anxiety attacks, making her susceptible to the psychological injuries she ultimately suffered. Issue: Did the college’s failure to protect the student from bullying cause the student’s psychological injury? Was it a factual cause of her harm? Decision: Tobias AJA (Macfarlan and Barrett JJA agreeing) applied Strong v Woolworths Ltd. The court affirmed the primary judge’s decision that it was more probable than not that had the college taken reasonable steps to protect the plaintiff from the bullying that occurred, she would not have suffered psychological injury (at [71]). Their Honours stated (at [15]): The appellant was required to prove that it was more probable than not that but for the failure of the College to deal with the students who were bullying her, she would not have suffered the psychological injury … Tobias AJA applied the approach to factual causation from Strong (at [66]–[68]) and found (at [71]): [I]t is more probable than not that, but for the failure of the College to actively implement the policy, the psychological injury to the appellant would not have occurred or at least would have been minimised. Whilst I accept that domestic issues contributed to her condition, there can be little doubt, upon the medical evidence accepted by the primary judge and not challenged, that her psychological injuries were materially contributed to by the bullying that she was forced to endure during 2004 as a consequence of the College’s breach of its duty of care. … [T]he appellant has established causation.

Settlement Group Pty Ltd v Purcell Partners [2013] VSCA 370 applied Adeels Palace and Strong in a purely economic loss context, which involved a failure to complete a mortgage refinancing transaction. Dixon AJA of the Victorian Supreme Court, Court of Appeal stated (at [99]): ‘It is not necessary that the defendant’s negligence be the sole necessary condition of the occurrence of the harm.’ It had earlier noted (at [99]) that this ‘may be described as contributing to the occurrence of the harm’. Similar observations were made by the High Court of Australia in Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (at [45]) (see 4.6, 14.44). The plaintiff in Hornsby Shire Council v Viscardi (2015) 214 LGERA 311; [2015] NSWCA 417 was injured when he fell over a depression in a patched area of bitumen in a car park surface, which was found to be the product of restoration work undertaken by the council. On

appeal, the council argued that the trial judge had erred in finding that it in fact had carried out the restoration work and that the cracking of the asphalt, which was independent of the restoration and was not the [page 215] result of negligence, precluded a finding of causation. Applying Strong and Zanner (at [19]), the New South Wales Court of Appeal (comprised of Beazley P, Gleeson and Simpson JJA) stated ‘[t]hat other causes contributed to the respondent’s injury did not preclude a finding of liability against the appellant’. Bitupave Ltd t/as Boral Asphalt v Pillinger (2015) 72 MVR 460; [2015] NSWCA 298 (see 3.36) considered the application of the ‘but-for’ test with multiple tortfeasors. Ward JA reaffirmed (at [275]) the principle that, while the plaintiff bore the onus of proving causation, ‘it was not for him to disprove any or every conjectured alternative explanation for the non-organic material on the road’. Her Honour distinguished the case from Luxton v Vines and Bradshaw v McEwans, (see 4.13), holding (at [277]) that ‘[t]his is not a case where it is a matter of conjecture between inference of equal degrees of probability’. Ward JA (Emmett and Glesson JJA agreeing) applied Zanner v Zanner. The court held (at [282]): [T]he presence of a combination of roadbase and aggregate in the swathe was a necessary condition of the harm occurring. … Each of Boral and the Council had an opportunity to remove the windrow that had been created by a combination of their actions and each failed to do so. But for Boral’s failure to remove the windrow (to which it had added aggregate), the accident would not have occurred. But for the Council’s failure, when it completed the roadworks, to remove the windrow (other than by feathering it out as it did), the accident would not have occurred. The carrying out of the roadworks was in a practical sense a joint enterprise. Both contributed to the creation of the windrow and both failed to remove it.

‘Exceptional cases’ at common law and under the Civil Liability Acts 4.18

Several decades after Bonnington Castings and prior to the

United Kingdom Supreme Court (formerly the House of Lords) decision, Sienkiewicz v Greif (UK) Ltd; Knowsley Metropolitan Borough Council v Willmore [2011] UKSC 10 (see 4.20), the House of Lords decided the controversial case, Fairchild v Glenhaven Funeral Services Ltd [2003] 1 AC 32. In Fairchild, the House of Lords considered circumstances in which the claimants had developed mesothelioma as a result of workplace exposure to asbestos dust during periods of employment with more than one employer. Each claimant could establish negligence on the part of the various employers in allowing asbestos dust to be in the workplace atmosphere, but could not establish, on the balance of probabilities, which employer had exposed the claimant to the actual asbestos dust that had caused the disease. Largely for public policy reasons, the House of Lords held that in such a case, proof that each employer’s wrongdoing had materially increased the risk of contracting the disease was sufficient to satisfy the causal requirement for liability. 4.19 Each of the Australian jurisdictions with Ipp-fuelled civil liability legislation enacted specific provisions that were primarily designed to address cases like Fairchild, where the plaintiff can prove that she or he suffered the kind of harm the defendant was supposed to take care to prevent, but cannot affirmatively show, in a traditional way, that the defendant’s negligence caused the harm. New South Wales, [page 216] Queensland, Tasmania, Victoria and Western Australia have all passed legislation to the following effect (quoted at 4.2 but repeated below):3 In determining in an exceptional case, in accordance with established principles, whether negligence that cannot be established as a necessary condition of the occurrence of harm should be accepted as establishing factual causation, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party.

Even though it is concerned with factual causation, this special

provision invites the court to make an explicit values-based decision. However, it provides no guidance about how the court should decide ‘whether or not and why’ the defendant should be held liable, which presumably leaves it to the discretion of the judge. The provisions in the Australian Capital Territory and South Australia are more clearly focused on the kind of situation that arose in Fairchild, where the plaintiff cannot establish which of several concurrent tortfeasors caused her or his injury:4 Where, however, a person (the plaintiff) has been negligently exposed to a similar risk of harm by a number of different persons (the defendants) and it is not possible to assign responsibility for causing the harm to any one or more of them: (a) the court may continue to apply the principle [in the Australian Capital Territory, ‘the established common law principle’] under which responsibility may be assigned to the defendants for causing the harm; but (b) the court should consider the position of each defendant individually and state the reasons for bringing the defendant within the scope of liability.

In Paul v Cooke, Leeming JA (Ward JA agreeing) observed (at [84]), citing Fairchild and Sienkiewicz, that the effect of s 5D(2) is that ‘factual causation is not a necessary condition of legal causation’, noting ‘exceptional’ cases ‘where the plaintiff cannot prove that the defendant’s negligence was a necessary condition of the occurrence of the harm’. These special provisions also address another rare category of causation case. In this type of scenario, the plaintiff suffers harm from two independent causes, each of which was sufficient in its own right to have caused the harm. In such a scenario (sometimes referred to as one involving ‘multiple sufficient causes’) typical ‘but for’ logic cannot be applied to satisfactorily resolve the causal conundrum, because both breaches would necessarily be eliminated. Rather than have both wrongful acts escape responsibility, which would be the result of using this strict approach, value judgments or policy — appropriateness — can step in expressly, used to reach a more palatable result. The ability to use this section in this way was endorsed by Macfarlan JA in Nominal Defendant v Bacon (2014) 67 MVR 425; [2014] NSWCA 275, where he stated, obiter, that the applicability of s 5D(2) of the Civil

Liability Act 2002 (NSW) is not limited to bridging the ‘evidentiary gap’ but extends to a [page 217] different type of rare case, where a plaintiff’s injuries result from more than one sufficient condition. His Honour explained (at [31], [36]): At common law, ‘when separate and independent acts of negligence on the part of two or more persons … directly contributed to cause injury and damage to another, the person injured [could] recover damages from any one of the wrongdoers, or from all of them’ (Grant v Sun Shipping Co Ltd [1948] AC 549 at 563; Bennett v Minister of Community Welfare [1992] HCA 27; (1992) 176 CLR 408 at 429 per McHugh J). Thus ‘each sufficient condition [was] treated as an independent cause of the plaintiff’s injury’ (Strong v Woolworths Ltd … at [18], [28]; March v E & MH Stramare Pty Ltd … at 534). The ‘but for’ test did not adequately deal with such cases of separate and sufficient causes (March v Stramare at 516 and 523) and was not therefore applied at common law in them. … Such cases are exceptional cases of the type contemplated by the opening words of s 5D(2) and the application of the common law would result in a determination of those cases, using the next words in s 5D(2), ‘in accordance with established principles’.

4.20 Fairchild, with its ‘special rule’, was reinterpreted by the House of Lords in Barker v Corus (UK) Ltd [2006] 2 AC 572; [2006] 3 All ER 785, as a result of which recovery was allowed proportionately against each defendant (see 14.34–14.45). Parliament later reversed Barker by enacting the Compensation Act 2006 (UK) s 3, which allowed the claimant in mesothelioma cases to recover in full against each defendant. The exposure to asbestos and development of mesothelioma were again addressed at the highest judicial level in the United Kingdom in the following cases, heard together by the United Kingdom Supreme Court. These cases are, once again, complex, confronting and noteworthy. Case Example Sienkiewicz v Greif (UK) Ltd; Knowsley Metropolitan

Borough Council v Willmore [2011] 2 AC 229; [2011] 2 All ER 857 Facts: In each of two cases, heard together, only one defendant exposed the claimant to (low-level) asbestos, in circumstances where the claimant was also at risk of developing the disease from (low-level) exposure to fibres in the general atmosphere. Scientific proof was difficult to establish. Issue: Does the Fairchild line of authority and its carved out ‘exception’ to a strict application of the ‘but for’ test apply in these circumstances? Decision: The court held in favour of the claimants. Lady Hale lamented (at [167]): I pity the practitioners as well as the academics who have to make sense of our judgments in difficult cases. But these cases are hard rather than difficult. We are here concerned with one case of relatively light but long term exposure and one case of very slight and short term exposure, both set against a lifetime of environmental and other possible exposures about which nothing much is known. As Lord Brown implies, Fairchild kicked open the hornets’ nest. The House of Lords were confronted with [page 218] several employers, each of which had wrongly exposed their employees to asbestos, but none of which exposure could be shown to have caused the disease. I find it hard to believe that their Lordships there foresaw the logical consequence of abandoning the ‘but for’ test: that an employer or occupier whose wrongful exposure might or might not have led to the disease would be liable in full for the consequences even if it was more likely than not that some other cause was to blame (let alone that it was more likely than not he was to blame). But … that is the logical consequence and there is nothing we can do about it without reversing Fairchild. Even if we thought it right to do this, Parliament would soon reverse us, and it is easy to understand why. Asbestos has long been known to be a dangerous (as well as a useful) substance, employers and occupiers turned a blind eye to those dangers long after they knew or should have known about them, and mesothelioma is a dreadful disease. Lord Rodger stated (at [141]–[142]): The response of English law to the problem posed by the rock of uncertainty in mesothelioma cases is … to be found in the combination of the common law, as laid down in Fairchild’s and Barker’s cases, and s 3 of the [Compensation Act 2006 (UK)]. Defendants whose breaches of duty materially increase the risk that the victim will develop mesothelioma are liable jointly and severally for the damage which the victim suffers if he does in fact develop mesothelioma. This is the current version of the Fairchild exception, as it applies in cases of mesothelioma. Of course, the Fairchild exception was created only because of the present state

of medical knowledge. If the day ever dawns when medical science can identify which fibre or fibres led to the malignant mutation and the source from which that fibre or those fibres came, then the problem which gave rise to the exception will have ceased to exist. The breadth of the exception, including whether it applies to cases involving scientific gaps outside the mesothelioma context, is not completely clear. It could well be argued that it should not apply outside this context because, as an exception to ordinary requirements of proof, it needs to be constrained. In the same case, Lord Brown expressed his frustration and concern, by critically observing (at [174]–[176]): Mesothelioma claims are in a category all their own … I think it only right to indicate just how unsatisfactory I for my part regard this position to be and how quixotic the path by which it has been arrived at. The present position, exemplified by the facts of these very appeals, can be simply stated …: any person who negligently or in breach of duty exposes another more than minimally to the inhalation of asbestos fibres will be liable to make full compensation if that other develops mesothelioma more than five years later … irrespective of whether the victim was exposed by others to even longer and more intense inhalation (and indeed inhalation of more noxious fibres), whether negligently or not, and irrespective too of any environmental or other exposure (again, however intensive). … One need hardly stress how radically different such an approach to compensation represents from that followed in all other cases of physical injury. All other cases require that the claimant satisfies the ‘but for’ test of causation. Lord Brown questioned the justification of mesothelioma’s ‘special treatment’, noting that courts are often confronted with disease cases where establishing proof in the face of scientific uncertainty can be extremely difficult. He stated (at [186]): Although … mesothelioma claims must now be considered from the defendant’s standpoint a lost cause, there is to my mind a lesson to be learned from losing it: the law tampers with the ‘but for’ test of causation at its peril.

[page 219] 4.21 It is worth recalling that the Australian civil liability statutes generally exclude asbestos-related or dust-related diseases from their scope. Therefore, somewhat ironically, the exceptional case provisions, whose genesis lie in Fairchild, cannot be applied to Fairchild-like fact circumstances. Rather curiously, the courts in these types of cases

have to rely on common law principles. Yet, to date, Australian courts have shied away from applying this cluster of exceptional common law decisions from the United Kingdom’s highest courts. They may indeed continue to resist wholeheartedly endorsing the United Kingdom position, bearing in mind the concerns voiced by the United Kingdom Supreme Court itself with respect to where it believes Fairchild has (unfortunately, according to Lord Brown, for example) led them. In Adeels Palace Pty Ltd v Moubarak (decided prior to Sienkiewicz), the High Court of Australia noted, in obiter, that the plaintiffs’ claims did not fall within the New South Wales ‘exceptional case’ provision. This was unsurprising on the facts. Arguably, the fact that this provision was even mentioned when it was so off-point factually and legally may be of some significance: the court likely did so in order to be as thorough as possible in its discussion of factual causation under the Civil Liability Acts. Key Case Adeels Palace Pty Ltd v Moubarak (2009) 239 CLR 420; 260 ALR 628 Facts: See 4.8. Issue: Does this case come within the ‘exceptional case’ provision? Decision: The High Court of Australia stated (at [54]–[57]): [T]he Act does not expressly give content to the phrase ‘an exceptional case’. All that is plain is that it is a case where negligence cannot be established as a necessary condition of the harm; the ‘but for’ test of causation is not met. In such a case, the court is commanded ‘to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party’. But beyond the statement that this is to be done ‘in accordance with established principles’, the provision offers no guidance about how the task is to be performed. … At once it must be recognised that the legal concept of causation differs from philosophical and scientific notions of causation. It must also be recognised that before the Civil Liability Act and equivalent provisions were enacted, it had been recognised that the ‘but for’ test was not always a sufficient test of causation. But as s 5D(1) shows, the ‘but for’ test is now to be (and has hitherto been seen to be) a necessary test of causation in all but the undefined group of exceptional cases contemplated by s 5D(2).

Even if the presence of security personnel at the door of the restaurant might have deterred or prevented the person who shot the plaintiffs from returning to the restaurant, and even if security personnel on the floor of the restaurant might have been able to intervene in the incident that broke into fighting in time to prevent injury to anyone, neither is reason enough to conclude that this is an ‘exceptional case’ where responsibility for the harm suffered by the plaintiffs should be imposed on Adeels Palace. To impose that responsibility would not accord with established principles. [page 220] It may be that s 5D(2) was enacted to deal with cases exemplified by the House of Lords’ decision in Fairchild … where plaintiffs suffering from mesothelioma had been exposed to asbestos in successive employments. Whether or how s 5D(2) would be engaged in such a case need not be decided now. The present cases are very different. No analogy can be drawn with cases like Fairchild. Rather, it would be contrary to established principles to hold Adeels Palace responsible in negligence if not providing security was not a necessary condition of the occurrence of the harm but providing security might have deterred or prevented its occurrence, or might have resulted in harm being suffered by someone other than, or in addition to, the plaintiffs.

In Strong v Woolworths Ltd, the factually unremarkable ‘slippage’ case which yielded serious harm (see 4.3, 4.11), the High Court of Australia also considered the operation of s 5D of the Civil Liability Act 2002 (NSW). As was the case in Adeels Palace, the court again reasoned that this case dealt solely with typical ‘but for’ causation issues and associated proof difficulties. Indeed, it would have been remarkable had this case been brought within the terms of the ‘exceptional case’ provision, which was primarily designed to address limited cases involving difficult evidentiary scenarios like those associated with asbestos and mesothelioma (as well as ‘multiple sufficient causes’ cases). The court also observed that it did not raise scope of liability normative issues. With respect to the requirement that a tortious act be a necessary condition of a plaintiff’s harm and when an exception might be relevant, their Honours stated (at [26]–[27]): Section 5D(2) makes special provision for cases in which factual causation cannot be established on a ‘but for’ analysis. The provision permits a finding of causation in exceptional cases, notwithstanding that the defendant’s negligence cannot be

established as a necessary condition of the occurrence of the harm. Whether negligent conduct resulting in a material increase in risk may be said to admit of proof of causation in accordance with established principles under the common law of Australia has not been considered by this Court. Negligent conduct that materially contributes to the plaintiff’s harm but which cannot be shown to have been a necessary condition of its occurrence may, in accordance with established principles, be accepted as establishing factual causation, subject to the normative considerations to which s 5D(2) requires that attention be directed. The authors of the Ipp Report and Allsop P in Zanner v Zanner assume that cases exemplified by the decision in Bonnington Castings would not meet the test of factual causation under s 5D(1)(a). However, whether that is so would depend upon the scientific or medical evidence in the particular case, a point illustrated by the decision in Amaca Pty Ltd v Booth with respect to proof of causation under the common law. In some cases, although the relative contribution of two or more factors to the particular harm cannot be determined, it may be that each factor was part of a set of conditions necessary to the occurrence of that harm.

A number of these leading decisions, including Adeels Palace Pty Ltd v Moubarak, Bonnington Castings Ltd v Wardlaw, Tabet v Gett and Sienkiewicz v Greif (UK) Ltd were considered by the New South Wales Court of Appeal in Evans v Queanbeyan [page 221] City Council (see 4.16), involving an individual who suffered from and then died of lung cancer. It again arose in a context in which there was occupational exposure to asbestos and a smoking history lasting 40 years, 20–35 cigarettes per day. His widow alleged that the respondents were responsible for her husband’s cancer due to his workplace exposure to asbestos dust. Her claim failed. The plaintiff in Jovanovski v Billbergia Pty Ltd (see 4.9) could not bring her case within the exceptional case provision. Similarly, the inability of being able to bring a case within s 5D of the Civil Liability Act 2002 (NSW) is illustrated by Carangelo v New South Wales [2016] NSWCA 126, where the appellant suffered a psychiatric injury while employed as a police officer. He claimed that the Commissioner was negligent in failing to offer him pastoral care and support or refer him to a psychiatrist. The New South Wales Court of Appeal upheld the

primary judge’s determination that the claim failed at causation. Applying Tabet v Gett, Emmett AJA (Macfarlan and Gleeson JJA agreeing) reaffirmed (at [68]) the principle that while certainty is not required, to make out causation the plaintiff must prove that ‘the more probable inference appearing from the evidence is that a defendant’s negligence caused the injury or harm’. Macfarlan JA stated (at [2]) that the plaintiff must establish that ‘the defendant’s conduct was responsible for an adverse difference in the plaintiff’s condition and its negligence “was a cause of that difference”’. Here, the evidence did not support such a conclusion. Emmett AJA also reviewed the antecedents to s 5D, paying particular regard to the provision directed at bridging the ‘evidentiary gap’ in an appropriate case, concluding (at [81]) that ‘[t]he reliance placed by Mr Carangelo on s 5D(2) appears to be misplaced … Section 5D(2) cannot be called in aid simply because there is no evidence to support a contention as to the causation of injury’. The corresponding ‘evidentiary gap’ provision in Victoria’s Wrongs Act 1958 (Vic) was considered in the following case. Case Example Powney v Kerang and District Health (2014) 43 VR 506; [2015] Aust Torts Reports ¶82-192; [2014] VSCA 221 Facts: The plaintiff underwent nasal surgery; feeling pain, he was injected with pethidine and discharged. He subsequently developed an infection at the injection site; it formed an abscess and led to septicaemia (bacteria in the blood). He was admitted to hospital with high fever and the abscess was surgically drained. He suffered permanent injury to his arm and an associated psychiatric condition. He alleged that the infection was due to the use of an uncapped and unsterile needle and that the complications were also due to failure by staff to respond to his complaints of pain in the arm. The defendant did not concede carelessness with respect to the injection. However, it contended that even if the injection had been administered negligently, it was not a cause of the infection. The trial was held before a jury that found in the defendant’s favour. The plaintiff appealed, arguing that the trial judge had failed to direct the jury in accordance with s 51(2) of the Wrongs Act 1958 (Vic), which provides that negligence that is not a necessary condition of the harm may nevertheless be taken to establish factual causation in an ‘appropriate case’. [page 222]

Issue: Did the facts engage the legislative provision directed at bridging the ‘evidentiary gap’? Decision: In their consideration of the special ‘evidentiary gap’ provision and the circumstances in which it can it be used, Osborn and Beach JJA and Forrest AJA of the Supreme Court of Victoria Court of Appeal cited several sources to determine parliament’s intention, including the Ipp Report, Bonnington Castings and Fairchild. The court noted that deciding when to relax the normal causation test involves a value judgment, as it is a normative (policy) matter, and that s 51(2) is recognition by the legislature that anomalous or unjust results may result from using the strict ‘but for’ test. The court held (at [85]) that the evidentiary gap may be bridged in an appropriate case as a question of law, as only judges can decide what the ‘established principles’ are that provide guidance as to whether a case is ‘appropriate’. The court stated (at [88]), to determine an ‘appropriate case’, regard is had to the section’s terms, informed by context (the rest of the Act), extrinsic materials (Ipp Report, Second Reading Speech, Explanatory Memorandum); and precedents. Doing so gives effect to parliament’s intention. Their Honours further observed (at [96]) that s 51(2) is not intended to be a fallback section where, in a typical or conventional case, the plaintiff simply cannot prove factual causation because the evidence is weak. The court made reference to the provision’s intended function (at [96], [98]): [I]t was designed to accommodate cases quite out of the ordinary — particularly those involving exposures to a particular agent on multiple occasions, all of which contributed to a disease process but factual causation could not be attributed to a specific exposure. Alternatively, it was to be employed where scientific evidence may be developing in identifying the level of exposure to a particular agent necessary to produce injury. … This was simply a failure to prove what was in truth a very weak case; the appellant was unable to prove his case beyond demonstrating a somewhat increased risk of injury arising out of a contentious single event. It was not suggested that there was some body of developing scientific knowledge on this issue. Section 51(2) was not directed to the appellant’s situation.

4.22 The following decision, involving complex medical evidence, applied a number of leading High Court of Australia cases on factual causation, including Adeels Palace Pty Ltd v Moubarak, Amaca Pty Ltd v Ellis, Chappel v Hart (see 4.26), Strong v Woolworths Ltd and Tabet v Gett. Case Example King v Western Sydney Local Health Network [2013] NSWCA 162 Facts: A mother contracted chicken pox early in her second trimester. Congenital varicella syndrome (CVS — chicken pox infection in pregnant women) led to the plaintiff

(her child) developing foetal varicella syndrome (FVS). The mother, who had not previously had chicken pox, sought advice from Blacktown Hospital. The [page 223] hospital failed to offer her a dose of a particular medication (VZIG) which may have prevented the plaintiff from developing FVS. Issue: Did the defendant’s negligent failure to administer VZIG to the plaintiff’s mother cause the plaintiff to contract FVS? Decision: By a majority of two to one (Hoeben and Ward JJA, Basten JA dissenting), the New South Wales Court of Appeal dismissed the plaintiff’s appeal. Neither Hoeben JA nor Ward JA were convinced that the evidence supported the plaintiff’s argument that it was more probable than not that the administration of VZIG to the plaintiff’s mother would have prevented the plaintiff from contracting FVS. Applying the approach of the High Court in Strong v Woolworths (see 4.3), Hoeben JA observed (at [109]) that the issue for the court ‘required a consideration of the probable course of events had the omission not occurred … What the appellant had to prove to establish causation was that had VZIG been administered on that day, it was likely that she would not have developed varicella’. In particular, Hoeben JA noted (at [110]) that only one expert was willing to express, in unqualified terms, that an administration of VZIG would have prevented the mother from developing varicella. Ward JA agreed, noting that (at [199]) all the appellant had proven was that administering the drug ‘might have made the occurrence of FVS less likely/less severe’. Ward JA concluded (at [204]): [T]he failure to give the VZIG to the mother was not in my view established to have been a necessary condition of the occurrence of FVS in the appellant. Even if the drug had been given to the mother, it was more likely than not that the mother would have contracted varicella and there remained a risk that the appellant would have been afflicted by FVS. The failure to administer VZIG did not in my opinion materially contribute to that risk (particularly if the effect of administration of VZIG would have been only to attenuate the effect of the infection and not to prevent it). Basten JA, dissenting, drew the inferences required to satisfy the ‘necessary condition’ provision from the evidence, such that factual causation was established. He further noted, in the alternative, that reliance could be placed on the exceptional case provision. In response to the concern that this section had not been relied upon or properly argued by the respondent (at trial or on appeal), Basten JA stated in his closing comments (at [34]): At trial, it was said that the plaintiff eschewed reliance on s 5D(2). However, like the relationship between duty, content and breach, questions of factual causation and scope of liability, as separately identified in s 5D, do not readily fall into separate and independent watertight compartments. Valuable as it is to separate the ‘factual’ and ‘policy’ elements of causation, the separation is, to an extent, an

artefact. It would be a triumph of form over substance to deny the plaintiff recovery on that basis.

Bearing in mind the High Court of Australia’s comments in Wallace v Kam (see 4.26), Basten JA’s dictum should be treated with caution, or circumspectly. 4.23 Difficult cases exist which cannot be helped by notions of ‘material contribution’ or statutory provisions that allow for the employment of exceptional approaches. In these scientifically complex cases, the medical evidence is insufficient to prove, on a balance of probabilities, that the ‘faulty’ cause was indeed connected to the harm. [page 224] One of the most notorious and unfortunate examples of this occurred in the oft-cited House of Lords case, Wilsher v Essex Area Health Authority [1988] AC 1074. Martin, born prematurely, was carelessly given too much oxygen. He went blind. He could not establish, on the evidence, to the court’s satisfaction, that the defendant’s negligent treatment caused his harm. While the careless conduct may have caused his blindness, so, too, may any one of several other conditions. Because the court did not know if there was a causal connection between the medical carelessness and his harm, it could only speculate or guess that such a causal connection existed. To succeed in an action for damages based on negligence, more than mere guesswork is required. Unlike the scenario in Bonnington Castings, the facts in Wilsher did not involve only one known agent of harm.

‘Loss of a chance of a better outcome’: a ‘radical’, failed attempt to deal with proof problems 4.24 The High Court of Australia settled an aspect of causation that had been uncertain and of great concern to the medical profession for some time — ‘loss of a chance’. The ‘loss of a chance of a better

outcome’ had been argued in cases where the plaintiff faced a serious medical prognosis, but was unable to show that there was a greater than 50 per cent chance that she or he would have recovered had it not been for the defendant’s negligence. Allowing recovery for the loss of a chance would have represented a significant departure from orthodox causal inquiries and determinations. The High Court was not prepared to make that leap. Key Case Tabet v Gett (2010) 240 CLR 537; 265 ALR 227 Facts: Reema Tabet, aged six, was admitted to hospital with vomiting, nausea and headaches. She had recently suffered chicken pox. Her paediatrician, Dr Gett, made a provisional diagnosis that included viral encephalitis, meningitis and chicken pox. A few days later, she suffered a seizure and was given a CT scan, which revealed a brain tumour. Surgery was performed. She suffered irreversible brain damage from (i) the tumour, (ii) the surgery to remove it and (iii) the follow-up treatment. After assessing the expert evidence, the trial judge found that based on Reema’s symptoms, an earlier scan should have been conducted. Not doing so was negligent. Issue: Was it acceptable to allow recovery for the loss of a chance of a better outcome, rather than proving actual damage on a balance of probabilities? Decision: The trial judge held that Reema lost a chance of a better medical outcome by not having had an earlier scan; she would have been treated by steroids rather than drainage, thus reducing the accumulation of spinal fluid on the brain (and intracranial pressure). This was said to amount to 25 per cent of her overall disability; the loss of a chance of a better outcome was assessed at 40 per cent. The Court of Appeal reversed the decision. However, it held that if the loss of a chance finding were upheld it should be assessed at 15 per cent. [page 225] The High Court unanimously dismissed Reema’s appeal, deciding the case on the basis of common law principles, as the New South Wales Civil Liability Act did not apply. Heydon J refused to decide the contentious legal issue because, in his view, the factual medical basis on which it was argued could not support the claim; therefore, in his opinion, that issue was merely hypothetical. The rest of the court addressed the contentious point, holding that it was unwilling to recognise the loss of the chance for a better medical outcome, where medical negligence has been established, as damage. It emphasised the foundational principle that the plaintiff has the onus of proving that it was more likely than not that damage had been suffered because of the defendant’s carelessness. The loss of a chance approach should not be followed in the medical

negligence context, where the plaintiff has not proven that she or he would have had a higher than 50 per cent chance of a better outcome if it were not for the defendant’s negligence. Gummow J observed that the ‘all or nothing’ approach in personal injury cases strikes a balance between competing interests; while a loss of a chance rule would shift that balance towards claimants, this could produce deleterious consequences for the community, such as an increase in costly ‘defensive medicine’ practices. Endorsing Gummow J’s concerns, Crennan J stated that such a ‘radical’ rather than incremental doctrinal change should be left to parliament, as it would have a major effect on insurance schemes and liability insurance funds. In addition to concurring with Kiefel J’s judgment, Hayne and Bell JJ noted that in negligence, damage means a detrimental difference to the plaintiff, which must be proven on a balance of probabilities to have been brought about by the defendant’s carelessness. The mere possibility that Reema’s brain damage would have been less severe than it was cannot substitute for proving that this difference was probable. Their Honours stated (at [67]): [S]aying that a chance of a better medical outcome was lost presupposes that it was not demonstrated that the respondent’s negligence had caused any difference in the appellant’s state of health. That is, it was not demonstrated that the respondent’s negligence was probably a cause of any part of the appellant’s brain damage. [Emphasis in the original.] On the facts of Reema’s case, Kiefel J reasoned (at [114], [118], [141]): The difficulty … the appellant faced … was that the expert medical evidence did not establish the link between the omission of the respondent, with the consequent delay in treatment, and the brain damage which occurred on 14 January, necessary for a finding of causation. There was no evidence as to what harm might have been caused by the delay. It could not be said that ‘but for’ the delay the appellant would not have suffered brain damage. … This evidence does not support a finding that any chance of a better outcome was as high as 40 per cent. The Court of Appeal observed that, whilst it might be inferred from this evidence that corticosteroids might have some effect, it ‘did not permit any conclusion as to what that effect would have been’. It considered that, at the most, it could be said that the appellant ‘lost some chance of a better outcome which ranged between speculative and some effect’, but went on to hold that even so, to permit recovery for the deprivation of the possibility, but not the probability, of a better outcome would be to significantly alter the existing law as to proof of causation of injury, in particular by redefining what is ‘harm’. … [page 226] … A conclusion that earlier treatment would have altered that outcome is not possible. It could not therefore be demonstrated that the respondent’s negligence was probably a cause of the appellant’s brain damage.

Kiefel J criticised ‘loss of a chance’ as a means by which an attempt is made to circumvent traditional causal requirements (at [143], [152]): Resort to the language of ‘chance’ cannot displace the analysis necessary for the determination of the issue of causation of damage. Properly analysed, what is involved in the chance referred to … is the possibility, to put it at its highest, that no brain damage would occur or that it would not be so severe. … Expressing what is said to be the loss or damage as a ‘chance’ of a better outcome recognises that what is involved are mere possibilities and that the general standard of proof cannot be met. … The appellant is unable to prove that it was probable that, had treatment by corticosteroids been undertaken earlier, the brain damage which occurred on 14 January 1991 would have been avoided. … The requirement of causation is not overcome by redefining the mere possibility, that such damage as did occur might not eventuate, as a chance and then saying that it is lost when the damage actually occurs. Such a claim could only succeed if the standard of proof were lowered, which would require a fundamental change to the law of negligence. The appellant suffered dreadful injury, but the circumstances of this case do not provide a strong ground for considering such change. It would involve holding the respondent liable for damage which he almost certainly did not cause.

As the court noted in Tabet v Gett, fundamental changes to longstanding principles governing the onus and standard of proof requirements should be left to parliament, a body that is better equipped to research the implications for the community generally of any such changes. In fact, despite the many statutory changes to the common law that were introduced as a result of the Ipp Panel’s recommendations, no such radical changes were made to matters of proof. A change reflecting a shift to the loss of a chance as sufficient proof would have run counter to the change agenda in vogue at the time. Case Example Robinson Helicopter Company Inc v McDermott (2016) 331 ALR 550; 90 ALJR 679; [2016] HCA 22 Facts: The first respondent, a passenger, was seriously injured in a helicopter crash that also resulted in the pilot’s death. It was not disputed that the crash occurred because one of the four bolts securing the flex plate (which transfers torque from the helicopter’s engine to the main rotor gearbox) was not tightened to the requisite degree (‘the defect’). While it was unknown how and when the defect arose, the plaintiff claimed that

the helicopter instruction manual did not provide sufficient instruction to detect the defect during maintenance inspections. The manual did not include a direction to check the security of the bolts with a torque wrench, and thus relied entirely on periodic visual inspections of the torque stripe. [page 227] Issue: Did the helicopter maintenance manual provide an adequate inspection procedure for the detection of the defect and if not, did this cause the crash? Decision: The High Court, comprised of French CJ, Bell, Keane, Nettle and Gordon JJ, unanimously reversed the decision of the Supreme Court of Queensland, Court of Appeal, which had reversed the trial judge in a divided decision; the trial judge had held that it had not been proven that the manual was inadequate. The High Court applied the principle (at [43]) that ‘a court of appeal should not interfere with a judge’s findings of fact unless they are demonstrated to be wrong by “incontrovertible facts or uncontested testimony”, or they are “glaringly improbable” or “contrary to compelling inferences”’. Ultimately, the High Court decided (at [78]) that the instructions in the manual provided by Robinson were adequate for the company to discharge its duty of care ‘in the circumstances of this case’. Even though it was not necessary to consider causation, the court nevertheless held that the claim would fail at that stage because it could not be established. The case also provided an opportunity to reaffirm the principle outlined in Tabet. The court stated (at [86]–[87]): [T]his Court has set its face against recovery of loss of a chance in the law of negligence relating to personal injuries. Although proof of causation may sometimes entail the robust, pragmatic drawing of inferences, especially where there are a number of possible causes and there is difficulty in ascertaining which of them was the cause of damage suffered, proof of causation still requires proof on the balance of probabilities that the alleged breach of duty was the cause of the damage suffered. … [S]uch evidence as there was on the matter pointed against the likelihood that Mr Fisher and Mr Bray [the maintenance engineers] would have been any more assiduous in adhering to a recommendation that they check the torque of the bolts with a torque wrench than they were in examining the torque stripes in accordance with the Manual. Although each of them gave evidence that he was familiar with the Manual, and that he followed it, both of them said that they did so without necessarily looking at the Manual and Mr Fisher said that he did not make use of the check list. Neither of them said that he would have been any more likely to adhere to a recommendation that he check the bolts with a torque wrench than he was likely to conduct a thorough examination of the torque stripes for indications of possible bolt rotation.

4.25 In Tabet v Gett, the High Court of Australia was careful to distinguish cases involving personal injury in the medical negligence context from commercial circumstances, where the ‘commercial interest lost may readily be seen to be of value itself’ (see Kiefel J in Tabet v Gett at [124]). Therefore, the loss of an opportunity approach remains permissible as a means by which to establish damage or loss with respect to commercial disputes. In Tabet, Kiefel J also noted that because controversial cases involving modifications to causation principles, such as McGhee v National Coal Board (see 4.30) and Fairchild v Glenhaven Funeral Services Ltd were not relevant on the facts, they did not have to be explored. [page 228] The High Court of Australia unanimously allowed the solicitor’s appeal in Badenach v Calvert (2016) 257 CLR 440; 331 ALR 48; 90 ALJR 610; [2016] HCA 18, a case primarily concerned with duty of care principles. Although doing so was strictly unnecessary, as was the case in Robinson Helicopter, the court considered causation. The court held that the claim failed as the onus of proof had not been discharged. French CJ, Kiefel and Keane JJ noted (at [34]): Even if it be accepted that the solicitor came under a duty to advise the client in the terms alleged, it cannot be concluded, on the balance of probabilities, what course of action the client would then have taken. In addition to the choices available to the client, there would have been other matters put to the client for his consideration including the risks concerning the irreversible nature of the inter vivos transactions, and the associated cost and delay.

Their Honours endorsed the principle from Tabet v Gett (at [38]–[40]): [T]o speak of loss as the loss of a ‘chance’ distorts the question of causation. It involves the application of a lesser standard of proof than is required by the law and, it follows, by s 13(1)(a) [of the Civil Liability Act 2002 (Tas)]. It confuses the issue of the loss caused with the issue of assessing damages which are said to flow from that loss. … The respondent’s case on causation is not improved by seeking to equate the chance spoken of with an opportunity lost. It may be accepted that an opportunity which is lost may be compensable in tort [citing Sellars v Adelaide Petroleum NL (1994) 179

CLR 332 at 364; 120 ALR 16 at 37]. But that is because the opportunity is itself of some value. An opportunity will be of value where there is a substantial, and not a merely speculative, prospect that a benefit will be acquired or a detriment avoided. It remains necessary to prove, to the usual standard, that there was a substantial prospect of a beneficial outcome. This requires evidence of what would have been done if the opportunity had been afforded. The respondent has not established that there is a substantial prospect that the client would have chosen to undertake the inter vivos transactions. Therefore, the respondent has not proven that there was any loss of a valuable opportunity.

Gordon J similarly stated (at [97]–[98]): Mr Calvert did not prove what steps (if any) the testator would have taken had the appellants discharged the duty of care they owed to the testator, or that by reason of the testator having taken those steps, he would have received the entirety (or at least a greater portion) of the testator’s estate. In short, Mr Calvert did not establish that the appellants’ negligence caused his loss. It is for that reason that issues of the sufficiency or value of the ‘opportunity’ purportedly lost do not arise for consideration — the first and necessary step of proving, on the balance of probabilities, a causal relationship between the tortious conduct and the purported ‘loss of opportunity’, before any assessment of the amount of the loss, was absent. This can be directly contrasted with the position in Sellars v Adelaide Petroleum NL. There, it was found, on the balance of probabilities, that the contract would have been entered into but for the impugned conduct. Here,

[page 229] Mr Calvert could not prove, on the balance of probabilities, what the testator would have done had there not been a breach of duty (assuming such a duty existed). In particular, Mr Calvert could not prove, on the balance of probabilities, that the testator would have taken steps necessary for him to have acquired a better outcome than in fact happened, such as receiving the entirety (or at least a greater portion) of the testator’s estate.

See also 4.26.

How the plaintiff would have acted: a problem of proof 4.26 When the plaintiff complains of negligent advice by the defendant, the causation question necessarily requires consideration of the plaintiff’s response to the advice. If the defendant made a misleading statement, the court must ask whether the plaintiff relied on that statement: what would the plaintiff have done if she or he had

not been given the advice in question? If the plaintiff would have acted in the same way without receiving the defendant’s advice, the advice did not cause the plaintiff’s loss. If the plaintiff would not have acted as she or he did without receiving the defendant’s advice, the advice caused the harm in fact. As we shall see when considering liability for negligent misstatements in Chapter 8, the court must also consider whether the plaintiff acted reasonably in relying on that advice. If the plaintiff complains of the defendant’s negligent failure to give advice, the hypothetical the court must consider by way of comparison is ‘what would the plaintiff have done if she or he had been given the advice?’. In this kind of case, the common law in Australia requires consideration only of what the plaintiff would have done, not what a reasonable person in the plaintiff’s position would have done. New South Wales, Queensland, Tasmania and Western Australia enacted legislative provisions that give effect to a subjective test similar to that adopted at common law, but with an important evidentiary qualification. The statutory provisions governing causation in those four jurisdictions are included below (they were extracted as part of the complete causation framework at 4.2).5 Victoria’s provision mirrors the common law but does not include the evidentiary barrier in para (b) (see 4.29). If it is relevant to deciding factual causation to decide what the person who suffered harm would have done if the negligent person had not been negligent: (a) the matter is to be decided subjectively in the light of all relevant circumstances, subject to paragraph (b); and (b) any statement made by the person after suffering the harm about what he or she would have done is inadmissible except to the extent (if any) that the statement is against his or her interest.

Two leading High Court of Australia cases decided at common law follow. [page 230]

Key Case Chappel v Hart (1998) 195 CLR 232; 156 ALR 517 Facts: The plaintiff’s oesophagus was perforated during surgery performed on her by the defendant, resulting in damage to her vocal cords and a partial loss of her voice. At the time, the operation was elective, but the plaintiff would eventually have had to undergo it. The defendant did not perform the operation negligently, but he did negligently fail to warn the plaintiff of the risk of perforation, which was inherent in the operation. (See Rogers v Whitaker (1992) 175 CLR 479; 109 ALR 625 and 3.16.) If the plaintiff had been warned of the risk, she would not have undergone the operation when she did, but would have had the operation later and would have taken steps to have it performed by the most experienced surgeon available. Issue: Did the defendant’s negligent failure to warn cause the plaintiff’s injuries? Decision: The High Court held, by a majority of three to two, the doctor’s failure to warn had caused the patient’s injury. Gummow J said (at CLR 256–7; ALR 534–5): In Environment Agency (formerly National Rivers Authority) v Empress Car Co (Abertillery) Ltd [1998] 1 All ER 421 at 486–8 … Lord Hoffmann … emphasise[d] that (a) the legal issue is not what caused the result complained of, but did the defendant cause it, and (b) ‘common sense’ answers to questions of causation will differ according to the purpose for which the question is asked and the rule by which responsibility is being attributed. In particular, ‘one cannot give a common sense answer to a question of causation for the purpose of attributing responsibility under some rule without knowing the purpose and scope of the rule’ [at 488]. … The nature and purpose of a duty with the content established in Rogers v Whitaker concern the right of the patient to know of material risks which are involved in undergoing or forgoing certain treatment. This, in turn, arises from the patient’s right to decide for himself or herself whether or not to submit to the treatment in question. … … It is true that in some cases of a failure to warn by a medical practitioner an application of the ‘but for’ test without qualification could lead to absurd or unjust results. Such would have been the situation if, for example, instead of suffering damage to her laryngeal nerve, [the plaintiff] had been injured through the misapplication of anaesthetic. While it would still be open to conclude that, but for [the defendant’s] failure to warn her of the possibility of damage to her voice, she would not have opted for the operation at that time and would not have been injured by the anaesthetic, the law would not conclude that the failure to warn of the risk of injury to the laryngeal nerve caused the injury resulting from the anaesthetic. The present appeal is significantly different from the situation described. In [the plaintiff’s] case, the very risk of which she should have been warned materialised.

Case Example Rosenberg v Percival (2001) 205 CLR 434; 178 ALR 577 Facts: The plaintiff suffered severe complications after undergoing routine elective dental surgery performed by the defendant. The defendant performed the surgery [page 231] without negligence, but did not warn the plaintiff of the risk of the particular complication. At trial, the plaintiff gave evidence that she would not have undergone the surgery if she had been warned of the risk. Issue: What test is to be used to determine whether a patient would have undertaken a medical treatment? Decision: The trial judge rejected the plaintiff’s evidence and held that she would have undergone the surgery even if she had known of the risk. This decision for the defendant was overturned by the Full Court of the Supreme Court of Western Australia, but restored by the High Court of Australia. McHugh J said (at [24]): Under the Australian common law, in determining whether a patient would have undertaken surgery, if warned of a risk of harm involved in that surgery, a court asks whether this patient would have undertaken the surgery. The test is a subjective test. It is not decisive that a reasonable person would or would not have undertaken the surgery. What a reasonable person would or would not have done in the patient’s circumstances will almost always be the most important factor in determining whether the court will accept or reject the patient’s evidence as to the course that the patient would have taken. But what a reasonable person would have done is not conclusive. If the tribunal of fact, be it judge or jury, accepts the evidence of the patient as to what he or she would have done, then, subject to appellate review as to the correctness of that finding, that is the end of the matter. … [I]n this field Australia has rejected the objective test of causation in favour of a subjective test.

The High Court of Australia considered this issue (among others) in the leading case, Wallace v Kam (see 4.3, 4.4), applying the Civil Liability Act 2002 (NSW). This case is also extracted under ‘Scope of Liability’ (see 4.34), where the court had to consider the appropriateness or otherwise of imposing causal responsibility on the

defendant. This normative concern was central to the High Court’s decision. Key Case Wallace v Kam (2013) 250 CLR 375; 297 ALR 383 Facts: The defendant, a neurosurgeon, performed spinal surgery on the plaintiff. The procedure had inherent risks, one of which was temporary damage to thigh nerves (‘neurapraxia’) and another was permanent and catastrophic paralysis as a result of damage to spinal nerves. The procedure was unsuccessful and the plaintiff suffered neurapraxia, which caused him ‘severe pain for some time’. The plaintiff argued that the defendant had failed to inform him of the risks of the procedure, including the risk of neurapraxia and the risk of paralysis. The plaintiff would not have undergone the procedure had he been warned of all material risks; however, he would have undergone the procedure had he been warned only of the risk that did indeed materialise. Issue: Was the failure to warn a cause of the plaintiff’s harm? Was it appropriate for the scope of the neurosurgeon’s liability to extend to the physical injury which was in fact sustained by the plaintiff? [page 232] Decision: The High Court of Australia, comprised of French CJ, Crennan, Kiefel, Gageler and Keane JJ, unanimously held that the defendant was not liable for the plaintiff’s neurapraxia. On the question of factual causation in the context of a failure to warn of the risks of medical procedures, the court observed (at [17]): In a case where a medical practitioner fails to exercise reasonable care and skill to warn a patient of one or more material risks inherent in a proposed treatment, factual causation is established if the patient proves, on the balance of probabilities, that the patient has sustained, as a consequence of having chosen to undergo the medical treatment, physical injury which the patient would not have sustained if warned of all material risks. The court considered the relationship between a medical professional’s failure to warn and the establishment of causation in three different scenarios (at [18]–[20]): Three factual scenarios have been presented by the cases. One is where the patient would have chosen to undergo the treatment that was in fact chosen even if warned of all material risks. In that scenario, a determination can be made of no factual causation. That is because, absent the negligent failure to warn, the treatment would still have gone ahead when it did and the physical injury would still have been sustained … Another scenario is where the patient would have chosen not to undergo the

treatment at all if warned of all material risks. In that scenario, a determination of factual causation can be made without difficulty. That is because, absent the negligent failure to warn, the treatment would not have gone ahead at any time and the physical injury would not have been sustained. Yet another scenario is where the patient, if warned of material risks, would have chosen not to undergo the treatment at the time the treatment in fact took place but may have chosen to undergo the treatment at a later time. Analysis of that further scenario has been more controversial. The better analysis is that it is also a scenario in which a determination of factual causation should be made. Absent the negligent failure to warn, the treatment that in fact occurred would not have occurred when it did and the physical injury in fact sustained when the treatment occurred would not then have been sustained. The same treatment may well have occurred at some later time but (provided that the physical injury remained at all times a possible but improbable result of the treatment) the physical injury that was sustained when the treatment in fact occurred would not on the balance of probabilities have been sustained if the same treatment had occurred on some other occasion. The court found that the facts of the case fell within the second scenario. Therefore, factual causation was established (at [28]–[29]). However, the claim failed for normative reasons, applying the scope of liability provision.

In the following cases, the courts have applied the statutory prescriptions and/or leading common law decisions in their deliberations, assessing what the plaintiffs’ responses would have been had the breaches not occurred. In Odisho v Bonazzi [2014] VSCA 11; (2013) Aust Torts Reports ¶82155, a gynaecologist failed to warn a patient of the side-effects of consuming tranexamic acid, a drug prescribed to treat abnormally heavy menstrual bleeding. The patient developed multiple pulmonary emboli (blockages in the lung arteries as the result of one or more blood clots travelling from elsewhere in the body). Beach JA and McMillan AJA (Nettle JA agreeing) of the Victorian Supreme Court, Court of Appeal [page 233] affirmed the principles in Roger v Whitaker and referred briefly to Adeels

Palace (at [30]–[31]). The court found (at [34]) that the question of whether tranexamic acid caused the pulmonary emboli was, at best, one that ‘invites speculation’, and the evidence did not lead to a conclusion, ‘as a matter of probability’, that the consumption of tranexamic acid was a cause of her emboli. Even though it was not necessary to consider the additional aspect of causation in these circumstances, that is, what the appellant would have done if warned, their Honours nevertheless observed (at [41]) that ‘[e]vidence of what a person would have done if warned, which is given with the benefit of the hindsight of what actually occurred, has been described as “so hypothetical, self-serving and speculative as to deserve little (if any) weight, at least in most circumstances”’ (citing Kirby J in Hoyts Pty Ltd v Burns (2003) 77 ALJR 1934 at [54]). The court observed (at [41]): The exaggerated nature of the appellant’s answers to the questions put to her on the issue of what she would have done had she received a warning well justified the trial judge’s rejection of this evidence. When one looks at the whole of the evidence, including the evidence of treatment to which the appellant was prepared to consent, like the trial judge, we are unpersuaded that an appropriate warning of the risk of pulmonary emboli would have made any material change to the events that occurred.

An application for special leave to appeal to the High Court of Australia was denied (M20/2014). Fraser v Burswood Resort (Management) Ltd [2014] WASCA 130 considered whether the plaintiff, who worked as a croupier, would have acted differently if her employer, the Burswood Casino, had warned of the risks of driving home in the early morning (4:00 am) and being fatigued. Her claim failed. Martin CJ (McClure P and Newnes JA agreeing) of the Supreme Court of Western Australia, Court of Appeal, affirmed the trial judge’s decision that the plaintiff, who had the onus of proof, had not established (i) that the accident in which she sustained serious injuries was in fact due to her falling asleep or (ii) that a warning from her employer would have changed her behaviour (for example, by delaying her journey home) such that it altered the course of events. The appellant In Mansfield v Great Lakes Council (2016) 77 MVR 252; 217 LGERA 317; [2016] NSWCA 204 was injured when the bank

adjacent to a culvert gave way as he was crossing the culvert in his truck. The respondent roads authority was responsible for the road’s care and maintenance. The plaintiff appealed the primary judge’s finding in favour of the council. He argued that failure of the statutory authority to carry out the road works was manifestly unreasonable under s 43A of the Civil Liability Act 2002 (NSW), that immunity under s 45 was not engaged and that appropriate road signage could have prevented the resulting harm. The New South Wales Court of Appeal unanimously dismissed the appeal. With respect to causation, Basten JA (Beazley P and Leeming JA agreeing) stated (at [43]) that even if there had been a sign indicating that the road was narrow, or unsuitable for heavy vehicles, it is likely that the appellant would have continued with his trip. The ‘warning cases’ — Chappel v Hart, Rosenberg v Percival and Wallace v Kam (considered in detail below) — were distinguished in Central Darling Shire Council [page 234] v Greeney [2015] NSWCA 51. Dismissing the council’s appeal against the primary judge’s decision in favour of a worker who injured his back while undertaking work as directed by the council, Macfarlan JA (Sackville AJA and Beech-Jones J agreeing) of the New South Wales Court of Appeal observed (at [51]): Those cases involved positive conduct of the defendants in conducting medical procedures but it was the plaintiffs that permitted those procedures to occur. The causation question there was whether the plaintiffs would have made the same decision if advised of particular risks. Here, Mr Greeney [the employee] had no choice but to comply with Mr Hocking’s direction [a work process involving coupling vehicles], otherwise he would have lost his job … The Council’s negligence was therefore in the giving of the direction, not in the failure to give a warning.

Several claims against solicitors for their alleged negligence have considered causation issues involving plaintiffs’ responses had breaches not occurred. Recall Badenach v Calvert, considered at 4.25, which is also of interest with respect to causation and a lawyer’s

negligence, even though it was centrally concerned with duty of care issues and immunities. In Richtoll Pty Ltd v WW Lawyers Pty Ltd (in liq) [2016] NSWCA 308, the appellant and Ongoing Financial Services Pty Ltd (OFS) lent money at high interest rates on the security of real property. They sued the respondent law firm for negligence and breach of contract pertaining to two loan contracts. In particular, the respondent had failed to conduct a search of the Australian Securities and Investments Commission register at an appropriate time and advise OFS that receivers had been appointed to a prospective borrower. Citing Badenach v Calvert, Sackville AJA (McColl JA and Barrett AJA agreeing) noted (at [52]), ‘[w]here a defendant is alleged to have failed to provide information or advice that a competent professional would have provided, the plaintiff must show on the balance of probabilities, that had the appropriate information or advice been provided, he or she would have acted in a manner that avoided the loss’. Ultimately, Sackville AJA rejected the appellant’s submission, concluding (at [79]) that: The evidence does not justify this Court being satisfied on the balance of probabilities that OFS, had it been advised of the receivers’ appointment, and of the circumstances leading to the appointment, would have terminated the Loan Agreement prior to drawdown.

Sackville AJA also observed (at [80]) that while ‘caution must be exercised in extrapolating from the plaintiff’s conduct after a breach of duty has taken place, in determining what the plaintiff would have done had the defendant not been negligent’, this does not mean that such conduct cannot be considered. Lee v Elgammal [2016] NSWCA 26 involved a claim against a solicitor who had failed to properly advise a client with respect to his liabilities and obligations under a bank guarantee which he was subsequently called upon to pay. While the solicitor admitted negligence, he disputed that the client had suffered any loss. Gleeson JA, Tobias AJA and Emmett AJA of the New South Wales Court of Appeal unanimously allowed the solicitor’s appeal, holding that his negligence was not a cause of the

[page 235] respondent’s debt to the bank. The Court of Appeal observed (at [69]– [70]) that the basis for the primary judge’s determination regarding what the client would have done if he had been properly advised by his solicitor was his oral evidence: ‘It was evidence after the event, which was not against interest and was therefore inadmissible under s 5D’ (at [70]). The court held (at [73]) that ‘it is more likely than not that, if the Solicitor had advised the Client that the Guarantee was limited to $460,000, and the Guarantee had been amended to reflect a limit of $350,000 … then the Client would have signed the Guarantee’. The claim in Lucantonio v Stichter [2014] NSWCA 5 involved an allegation that a solicitor’s carelessness had caused or materially contributed to a trust losing a deposit and the possibility of substantial profits from a property redevelopment. In the plaintiff’s unsuccessful appeal, the New South Wales Court of Appeal, comprised of McColl, Barrett and Basten JJA, held that even though the lawyer had been negligent in providing timely advice, this was not causative of the loss, determined in accordance with s 5D(3)(a) of the Civil Liability Act 2002 (NSW), subjectively in light of all the relevant circumstances. Basten JA observed (at [141]) that this was not a case of inaccurate legal advice, but one involving the belated provision of accurate advice, and the ‘finding that the appellant would not have acted differently from the course in fact adopted had the advice been given in a timely fashion was well supported on the evidence’. The appellant in Falkingham v Hoffmans (A Firm) (2014) 46 WAR 510; [2014] WASCA 140 suffered back pain after a mountain bike incident and a referral to a neurosurgeon. Following an operation to treat a prolapsed disc, he suffered a permanent disability to his right leg. The appellant sought legal advice with respect to a potential negligence action. Because his solicitors failed to issue a writ within the limitation period, the appellant claimed against the solicitors for the loss of an opportunity to obtain redress for the surgeon’s negligence. The Supreme Court of Western Australia, Court of Appeal held that the

evidence supported the conclusion that the appellant would have commenced proceedings. Pullin and Murphy JJA (Buss JA agreeing) noted (at [41]) that ‘[t]he assessment of whether the appellant would have pursued the cause of action is determined subjectively, that is, by what the appellant (rather than a reasonable person) would have done in the circumstances’. The court was divided with respect to whether the appellant would have pursued the claim to trial as opposed to settlement. On a related matter, the court held that the plaintiff is not required to establish that the prospects of success in the ‘lost case’ were greater than 50 per cent, but must show, as noted by Pullin and Murphy JJA (at [39]) that the cause of action was ‘real’, ‘had some value’, was ‘viable’ or was not ‘doomed to fail’. The prospects of success are relevant to the quantum of damages recoverable. Additional issues that were considered by the court included damages assessment. 4.27 The extra difficulty associated with determining how a third party (as opposed to the plaintiff) would have acted if he had been warned (and threatened) in a case where he had acted intentionally and voluntarily is considered in Jovanovski v Billbergia Pty Ltd (see 4.9), which distinguished Chappel v Hart. [page 236] 4.28 As was noted previously, the legislative provisions enacted in New South Wales, Queensland, Tasmania and Western Australia give effect to a subjective test similar to that adopted at common law. Recall that they include an important evidentiary qualification in the following paragraph:6 (b) any statement made by the person after suffering the harm about what he or she would have done is inadmissible except to the extent (if any) that the statement is against his or her interest.

Paragraph (b) is designed to express what Basten JA in Elbourne v Gibbs [2006] NSWCA 127 at [67] called the ‘caution often given in relation to the weight to be placed upon the evidence, inevitably given

with the benefit of hindsight, as to what the [plaintiff] would have done in the hypothetical event’. In other words, because of a suspicion that some plaintiffs give self-serving evidence about what they would have done if the defendant had not acted negligently, these four jurisdictions have ensured that the court must ignore the plaintiff’s evidence, unless the evidence damages the plaintiff’s case. As Basten JA went on to observe in Elbourne, the effect of para (b) is that ‘the Court will be deprived of such indisputably relevant evidence’: (at [67]). The court must therefore somehow decide what the plaintiff would have done, subjectively, using evidence other than the plaintiff’s own testimony. In some cases, the court may be able to infer the plaintiff’s likely behaviour from other direct evidence. For example, in Commissioner of Main Roads v Jones (2005) 215 ALR 418, the plaintiff was unable to give evidence at trial because of the catastrophic nature of the injuries he suffered when the car he was driving collided with a horse that had strayed onto the highway. The plaintiff alleged that his injuries were caused by the defendant’s negligence in failing to impose a lower speed limit on the relevant stretch of road. Despite the lack of evidence from the plaintiff himself, a majority of the High Court of Australia agreed with the trial judge that a lower speed limit would have made no difference to the plaintiff’s behaviour because he had been driving at speeds well over the speed limit for much of the rest of the journey through rural Western Australia. Gleeson CJ stated (at [10]): The trial judge was satisfied … that the [plaintiff] was aware of the danger constituted by animals, both wild and domestic, along the whole length of the road on which he travelled at very high (and legally excessive) speed. He did not slow down on account of the danger to people at Turkey Creek. He ignored a sign reducing the speed limit. In fact, he appears to have ignored speed limits altogether. The likelihood that he would have responded to another sign reached a few minutes after he passed through Turkey Creek seems remote.

It is worth recalling the comments of Sackville AJA in Richtoll Pty Ltd v WW Lawyers Pty Ltd (in liq) [2016] NSWCA 308 regarding inferences from conduct: see 4.26. Where it is not possible to make inferences about how the plaintiff would

[page 237] have behaved, it is difficult to imagine how the court could apply the subjective test required by para (a) without using the evidence excluded by para (b). 4.29 As was noted previously, Victoria enacted legislation similar to that described in 4.26 and 4.28, but without para (b), which excludes the plaintiff’s own evidence.7 Thus, Victorian courts can decide for themselves what weight to place on the plaintiff’s evidence; whether to accept it, as was done in Chappel’s case or to reject it, as was done in Rosenberg’s case: see 4.26.

McGhee v National Coal Board and issues of proof 4.30 In the controversial British case, McGhee v National Coal Board [1973] 1 WLR 1, the plaintiff, who worked in a brick kiln, showed that his employer had negligently failed to provide washing facilities at his workplace, which would have enabled him to wash brick dust off his skin after work. He also established that he had suffered dermatitis, a skin disease. The evidence showed that the provision and use of washing facilities would have materially reduced the risk of dermatitis, but none of the expert medical witnesses would go so far as to say that washing after work would have made it more likely than not that the plaintiff would not have contracted dermatitis. Thus, the plaintiff could show negligence and the kind of harm that the negligence was supposed to prevent, but had not produced evidence to show, on the balance of probabilities, that he would not have suffered dermatitis even if the defendant had not been negligent. The House of Lords found for the plaintiff. Lord Wilberforce seemed to suggest that the burden of proof might pass to the defendant to disprove a causal connection between her or his negligence and the plaintiff’s injuries in such a case. He said (at 6): [I]t is a sound principle that where a person has, by breach of a duty of care, created a risk, and injury occurs within the area of that risk, the loss should be borne by him unless he shows that it had some other cause. Secondly, from the evidential point of

view, one may ask, why should a man who is able to show that his employer should have taken certain precautions, because without them there is a risk, or an added risk, of injury or disease, and who in fact sustains exactly that injury or disease, have to assume the burden of proving more: namely, that it was the addition to the risk, caused by the breach of duty, which caused or materially contributed to the injury?

4.31 There is no doubt that, under Australian law, the burden of proof remains on the plaintiff at all times and the defendant in such a case is under what is known as an ‘evidentiary onus’, which is an onus to produce evidence to explain the cause of the accident. In Bennett v Minister for Community Welfare (at CLR 420–1; ALR at 625), Gaudron J said: [G]enerally speaking, if an injury occurs within an area of foreseeable risk, then, in the absence of evidence that the breach had no effect, or that the injury would have occurred even if the duty had been performed, it will be taken that the breach of the common law duty caused or materially contributed to the injury.

[page 238] In City of Stirling v Tremeer (2006) 32 WAR 155 at [80], McLure JA (with whom Steytler P and Roberts-Smith JA agreed) stated: As I understand the law in Australia, once a plaintiff demonstrates that a breach of duty has occurred followed by injury within the area of the foreseeable risk, a prima facie causal connection will be established and the defendant has an evidential burden to show that the breach had no effect. However, once there is evidence sufficient to displace the plaintiff’s prima facie case, it remains for the plaintiff upon the whole of the evidence to satisfy the tribunal of fact of the extent of the injury caused by the defendant’s negligence.

In other words, inference can establish a causal connection but not where the evidence is inconsistent with that inference. The Court of Appeal of Western Australia used a similar analysis, drawing on McLure JA’s judgment in Tremeer, in two cases where the plaintiff suffered mesothelioma from the inhalation of asbestos dust: see Amaca Pty Ltd v Hannell (2007) 34 WAR 109 and Amaca Pty Ltd v Moss [2007] WASCA 162. Australian common law cases emphasise that the burden of proof remains on the plaintiff at all times, even if the defendant comes under

an evidentiary burden. The position is the same under the legislative enactments, which state that ‘the plaintiff always bears the burden of proving, on the balance of probabilities, any fact relevant to the issue of causation’. The question in cases like Tremeer is what inferences can properly be drawn from the facts proved by the plaintiff on the balance of probabilities. Res ipsa loquitur, slip-and-fall cases 4.32 In some cases, the very fact that the plaintiff has suffered injury creates an inference that that injury was caused by negligence on the part of the defendant. For example, if a moving car collides with a stationary car, the very fact of the collision creates an inference that it was caused by negligence on the part of the driver of the moving car. In these circumstances, ‘the thing speaks for itself’. This is often expressed in Latin, by use of the maxim res ipsa loquitur. Proof by the plaintiff of ‘the thing itself’ (that is, proof of the accident giving rise to the injuries) does no more than make out a prima facie case of negligence. It does not create a presumption of negligence that must be rebutted by the defendant. The plaintiff’s proof puts the defendant under an evidentiary onus to produce evidence to explain the cause of the accident. The onus of proof does not shift to the defendant: see Fitzpatrick v Walter E Cooper Pty Ltd (1935) 54 CLR 200; Mummery v Irvings Pty Ltd (1956) 96 CLR 99; Anchor Products Ltd v Hedges (1966) 115 CLR 493; Nominal Defendant v Haslbauer (1967) 117 CLR 448; Podmore v Aquatours Pty Ltd [1984] 1 NSWLR 111; GIO (NSW) v Best (1993) Aust Torts Reports ¶81-210 at 62,096–8 per Clarke JA; Jazairy v Najjar (1998) Aust Torts Reports ¶81476. The operation of the doctrine of res ipsa loquitur is explained in the following case. [page 239]

Key Case Schellenberg v Tunnel Holdings Pty Ltd (2000) 200 CLR 121; 170 ALR 594 Facts: The plaintiff was injured at work when an air hose became detached from a coupling (known as a ‘jamec coupling’) connecting it to an air compressor. The compressed air caused the hose to hit the plaintiff in the face and body, injuring him. He sued the defendant, his employer. The defendant provided no evidence to explain how the hose could have become detached from the jamec coupling, and the plaintiff provided no other evidence of negligence on the part of the defendant. Issue: Was the fact that the hose separated from the jamec coupling in itself evidence of negligence on the part of the defendant? Decision: The trial judge held that it was possible to infer that the separation of the hose was caused by the defendant’s negligence. The Full Court of the Supreme Court of Western Australia allowed the defendant’s appeal. The High Court of Australia affirmed the Full Court’s decision, holding that the doctrine of res ipsa loquitur did not apply in this case. Gleeson CJ and McHugh J said (at [22], [24]–[27]): Although Australian and English courts have diverged as to the scope and effect of the principle of res ipsa loquitur, in this country its scope and effect have been decisively settled by a series of decisions of this court. Those decisions make it clear that the trial judge was correct when he said that the principle is not a distinct, substantive rule of law, but an application of an inferential reasoning process, and that the plaintiff bears the onus of proof of negligence even when the principle is applicable … … When [the principle] applies, the trier of fact may conclude that the defendant has been negligent although the plaintiff has not particularised a specific claim in negligence or adduced evidence of the cause of the accident. But it does nothing more. For example, it does not reverse the onus of proof … [A] plaintiff may rely on res ipsa loquitur even though he or she has also pleaded particular acts or omissions of negligence on the part of the defendant provided that the tribunal of fact concludes that: 1. there is an ‘absence of explanation’ of the occurrence that caused the injury; 2. the occurrence was of such a kind that it does not ordinarily occur without negligence; and 3. the instrument or agency that caused the injury was under the control of the defendant. … In our opinion, the defendant’s argument is correct in asserting that the principle of res ipsa loquitur had no application once the learned trial judge found that the hose separated from the jamec coupling. The question then became whether the plaintiff had proved that the separation of the hose from the jamec coupling

occurred in circumstances of negligence. The relevant occurrence in the present case was the accident — the detachment of a hose, carrying compressed air, swinging around and striking the plaintiff in the face. If accidents of that kind do not occur if those who have control of the hose and its attachments use proper care, the plaintiff was entitled to rely on res ipsa loquitur to make out a prima facie case of negligence, and it was then for the judge to hold whether the occurrence constituted negligence having regard to all the other circumstances of the case. But once the cause of the occurrence was proved, the principle could play no part in the proceedings.

[page 240] In other words, when ‘the thing speaks for itself’, the defendant is asked to reply, by producing evidence which provides an explanation of the plaintiff’s injuries other than that they were caused by the defendant’s negligence. If she or he cannot do so, the plaintiff succeeds. If the defendant can do so, then the court must choose between conflicting explanations of how the accident occurred. It does this in the ordinary way, by considering which hypothesis is the more probable, and by determining whether it is more likely than not that that was what occurred. The onus of proof remains on the plaintiff, so if the court is not satisfied, on the balance of probabilities, that the plaintiff’s injuries were caused by the defendant’s negligence, then the plaintiff’s action fails. The court may decide on the basis of a res ipsa loquitur inference even where it remains unsure about exactly what happened, but it should only do that if the possible explanations point towards negligence on the defendant’s part. 4.33 In Australian cases typically (but not exclusively) concerning supermarkets and shopping malls, where the plaintiff is injured when she or he slips and falls on some substance that had been spilled onto the floor, the plaintiff must allege that her or his injuries were caused by the negligence of the supermarket or mall in failing to take reasonable care to keep the floors clean. Each of these claims (of which there are an enormously large number) raises a thorny causation problem: it may have been the case that the substance had

only just fallen on the floor when the plaintiff stepped on it. If so, there would not have been any time for it to have been cleaned up, even if the defendant had had a reasonably safe cleaning system. This was at issue in Strong v Woolworths Ltd: see 4.3, 4.11, 4.21. The High Court of Australia’s curious consideration of when most people eat chips, relevant to its determination of this case, is rather disquieting when one considers the nature of the discussion in a decision from such an eminent court, where the consequences for the plaintiff (in particular) were so significant. The majority, comprised of French CJ, Gummow, Crennan and Bell JJ, reason (at [37]–[38]) (footnotes omitted): If one reckons lunchtime as between 12.00 pm and 2.00 pm, it is right to say that the probabilities are evenly balanced as to the deposit of the chip between 12.00 pm and 12.15 pm and 12.15 pm and 12.30 pm, provided the chip was acquired for consumption at lunch. The Court of Appeal said that there was no basis for concluding that it was more likely than not that the chip was not dropped ‘comparatively soon before the [appellant] slipped’. It did not explain how it reasoned as to the likelihood that the chip was acquired at lunchtime. There was no basis for concluding that chips are more likely to be eaten for lunch than for breakfast or as a snack during the course of the morning. The inference was open that the chip was not present on the floor of the sidewalk sales area at the time the area was set up for the day’s trading. However, the conclusion that the chip had been deposited at a particular time rather than any other time on the day of the incident was speculation. Reasonable care required inspection and removal of slipping hazards at intervals not greater than 20 minutes in the sidewalk sales area, which was adjacent to

[page 241] the food court. The evidence did not permit a finding of when, in the interval between 8.00 am and 12.30 pm, the chip came to be deposited in that area. In these circumstances, it was an error for the Court of Appeal to hold that it could not be concluded that the chip had been on the ground for long enough for it to be detected and removed by the operation of a reasonable cleaning system. The probabilities favoured the conclusion that the chip was deposited in the longer period between 8.00 am and 12.10 pm and not the shorter period between 12.10 pm and the time of the fall.

The difficulty of proving factual causation in this type of case was

recognised in Queensland v Nudd [2012] QCA 281, where an inmate at a correctional centre who required crutches to walk fell heavily and was injured. He claimed that his injury was caused by his crutch coming into contact with a small amount of water in the common area of his cell block. Fraser JA (Holmes JA and Atkinson J agreeing) found that the evidence did not support a conclusion that there was a pool of water of a detectable size in the relevant area before the inmate’s fall. Therefore, it could not be said that the presence of an inspection system probably would have detected the water, ultimately preventing the respondent’s fall. Although the reasoning in Strong was applied, the Court of Appeal held that on this evidence factual causation was not established. Similarly, in Shoalhaven City Council v Pender [2013] NSWCA 210, which concerned a slip and fall on a ferry ramp, the question for the New South Wales Court of Appeal was whether the absence of an adequate cleaning system caused the plaintiff’s injury. In contrast to the result in Strong, causation was not established, as the plaintiff failed to show that he had fallen because the ramp was slippery, let alone that it was unreasonably slippery. Citing the approach used in Strong, McColl JA stated (at [97]): Proof of the causal link between an omission and an occurrence requires consideration of the probable course of events had the omission not occurred … The mere presence (had it been established) of a dry slippery surface on the ramp was not sufficient to establish causation … For the reasons I have given in respect of the lack of evidence concerning the ramp developing a degree of slipperiness requiring cleaning, the evidence did not support the conclusion that, had the appellant had a system of regularly water blasting the ramp it would not have been slippery on the day he fell …This was not a case where the probabilities assist in reaching that conclusion.

Additional cases of this nature are considered at 4.9 and 4.14.

Scope of Liability Normative considerations and policy 4.34

As was noted at the beginning of this chapter, the Civil Liability

Acts enacted in all jurisdictions except for the Northern Territory provide a similar framework which is to be used when addressing causation questions. The extended ‘scope [page 242] of liability’ provisions (which vary slightly, among the jurisdictions) are provided below:8 (1) A determination that negligence caused particular harm comprises the following elements: (a) that the negligence was a necessary condition of the occurrence of the harm (factual causation), and (b) that it is appropriate for the scope of the negligent person’s liability to extend to the harm so caused (scope of liability). … (4) For the purpose of determining the scope of liability, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party.

As we discovered previously, by breaking down the causation inquiry in this way, legislatures have directed the courts to structure their decision making in a manner that differentiates between the ‘necessary condition’ inquiry and the normative question. This is not to say that normative questions can never be relevant to factual determinations: recall exceptional United Kingdom cases like Fairchild v Glenhaven Funeral Services Ltd and Sienkiewicz v Greif (UK) Ltd; Knowsley Metropolitan Borough Council v Willmore, which involve an ‘evidentiary gap’ in the establishment of factual causation and used public policy considerations to help resolve issues of proof and cases involving issues associated with ‘multiple sufficient causes’, such as Nominal Defendant v Bacon (see 4.18–4.20). A number of judicial statements have emphasised that the second limb of this streamlined approach to causation, ‘scope of liability’, embraces policy-based considerations which courts are expected to articulate. This involves a determination of the ultimate attribution of

legal responsibility for what has already been established as a ‘necessary condition’ or factual cause of the harm. The following decision of the High Court of Australia (noted at 4.3, 4.4, 4.26) explores scope of liability considerations in the medical ‘failure to warn’ context. Key Case Wallace v Kam (2013) 250 CLR 375; 297 ALR 383 Facts: See 4.26. Issue: Was it appropriate for the scope of the neurosurgeon’s liability to extend to the physical injury which was in fact sustained by the plaintiff? [page 243] Decision: The High Court of Australia, comprised of French CJ, Crennan, Kiefel, Gageler and Keane JJ, unanimously held that the defendant was not liable for the plaintiff’s neurapraxia as it was not appropriate for the scope of the defendant’s liability to extend to the occurrence of injury the risk of which the plaintiff was willing to accept (at [39]). With respect to the scope of the defendant’s liability, the court framed the ‘critical question’ (paraphrased above, under ‘Issue’) as follows (at [30]): Is it appropriate for the scope of Dr Kam’s liability to extend to the physical injury in fact sustained by Mr Wallace in circumstances where Mr Wallace would not have chosen to undergo the surgical procedure had he been properly warned of all material risks but where he would have chosen to undergo the surgical procedure had he been warned only of the risk that in fact materialised? Taking into account the underlying policy that a patient should be protected from risks that they consider to be unacceptable, the court affirmed the approach of Allsop P (of the New South Wales Court of Appeal) and said (at [37]): The normative judgment that is appropriate to be made is that the liability of a medical practitioner who has failed to warn the patient of material risks inherent in a proposed treatment ‘should not extend to harm from risks that the patient was willing to hazard, whether through an express choice or as found had their disclosure been made’. Applying this principle to the facts of the case, the court found (at [39]): Dr Kam is not liable to Mr Wallace for impairment of Mr Wallace’s right to choose whether or not to undergo the surgical procedure and is not liable to Mr Wallace for exposing him to an unacceptable risk of catastrophic paralysis. He can be

liable, if at all, for the neurapraxia Mr Wallace sustained. As both Allsop P and Basten JA pointed out, the position of Mr Wallace in respect of the neurapraxia when considered for the purposes of causation is in principle no different from what his position would have been had Dr Kam properly warned him of the risk of neurapraxia and had he made an express choice to proceed with the surgical procedure in light of that warning. He is not to be compensated for the occurrence of physical injury the risk of which he was prepared to accept.

‘Scope of liability’ includes two longstanding common law concepts: (i) what has been traditionally referred to as ‘new intervening acts’ (or novus actus interveniens) and (ii) ‘remoteness of harm’. In Wallace v Kam the High Court of Australia declared the following (at [22]): In a case falling within an established class, the normative question posed … is properly answered by a court through the application of precedent. Section 5D guides but does not displace common law methodology. The common law method is that a policy choice once made is maintained unless confronted and overruled.

In Gratax Pty Ltd v T D & C Pty Ltd [2013] QCA 385, the Queensland Court of Appeal expressly applied this principle, holding that scope of liability had not been satisfied. Similar sentiments were expressed by the New South Wales Court of Appeal in Lym International Pty Ltd v Marcolongo (2011) 15 BPR 29,465; [2011] [page 244] NSWCA 303, where the court stated (at [260]) that determining appropriateness ‘is assisted not only by considerations of history and policy, but also by concrete examples of how the concept is applied’. Both new intervening act and remoteness of harm cases involve the need to make decisions that are undeniably value-laden. In the words of the Ipp Panel, the second limb is intended to ‘give some helpful legislative guidance’ to courts, who are meant to articulate the values or norms driving their decisions, where causal attribution choices are open to them. As the Ipp Panel stated (in its report at [7.41]), the fundamental normative question is, ‘should the defendant be

responsible for the ultimate harm?’. Ipp JA commented on the nature of this question in Ruddock v Taylor (at [87]–[88]): [T]he ultimate question to be answered when addressing the second aspect is a normative one, namely, whether the defendant ought to be held liable to pay damages for that harm … [emphasis in original] Terminology such as ‘common sense causation’ and ‘proximate’ or ‘dominant’ or ‘effective’ or even ‘legal’ cause conceal judicial reasoning, rather than explain it. These terms afford little guidance about when negligent conduct will be considered to have caused harm …

Ipp JA restated the gist of his comments from Ruddock v Taylor (see 4.2) in Harvey v PD: in a complex case, where the independent act of a third party or the plaintiff herself or himself materially contributes to the harm, one must ask whether the defendant ought to be held liable for the harm sustained. This involves ‘a normative weighing of all the relevant circumstances’ (at [187] in Harvey v PD). His Honour further stated in Harvey (at [188]): ‘Factual causation, however, does not alone establish legal causation. … The question remains … one to be determined by having regard to all the circumstances and then making a value judgment.’ In Graham v Hall (2006) 67 NSWLR 135 at [77]– [78], Ipp JA noted (Giles and McColl JJA concurring) that the Acts reflect this approach. 4.35 Ipp JA in Harvey relied on Hayne J’s comments in Pledge v Roads and Traffic Authority (2004) 205 ALR 56 at [10], where his Honour stated that once it is established that the breach under scrutiny played a role as a factual cause or necessary condition in producing the accident (or harm), one must consider the purpose of the inquiry. In an assessment of the attribution of legal responsibility, one must ask if the defendant should not be liable for a policy reason. In Elbourne v Gibbs (at [74]), Basten JA also noted the importance of focusing on the purpose of the inquiry, in its ‘particular statutory or other legal context’. This is similar to the observations in Travel Compensation Fund v Tambree (2005) 224 CLR 627; 222 ALR 263, where the High Court of Australia highlighted the importance of the purpose of the particular causal inquiry. In doing so, it focused on the objectives of the Fair Trading Act 1987 (NSW) and issues involving new intervening acts in a negligence and misleading and deceptive conduct claim.

Gleeson CJ (with whom Gummow, Hayne and Callinan JJ agreed) stated (at [28], [29]): [page 245] It is not in doubt that issues of causation commonly involve normative considerations, sometimes referred to by reference to ‘values’ or ‘policy’. However … the object is to formulate principles from policy, and to apply those principles to the case in hand. In the context of considering an issue of causation under the Fair Trading Act, the statutory purpose is the primary source of the relevant legal norms. To acknowledge that, in appropriate circumstances, normative considerations have a role to play in judgments about causation is not to invite judges to engage in value judgments at large. The relevant norms must be derived from legal principle. In this case, the primary task of the Court is to apply the legislative norms to be found in the Fair Trading Act, although the outcome is not materially different to applying the common law of negligence.

Gummow and Hayne JJ disapproved of ‘common sense’ as a test, emphasising the need to start any inquiry by focusing on the purpose of the Act or the nature of the common law action under which the causal inquiry is made. However, in their separate opinions, Kirby and Callinan JJ defended the ‘common sense’ test’s attributes. As was noted earlier, some other judges have persisted in employing this concept, even though its use had been criticised. For example, in Dobler v Halverson (2007) 70 NSWLR 151, aside from correctly refusing to apply a ‘loss of a chance’ approach to causation, the New South Wales Court of Appeal referred (at [117]) to ‘common sense’ in the context of a medical claim involving peer professional opinion and ‘causation in law’ (see 3.24): Assistance from expert scientific opinion does not negate the use of common sense in coming to a conclusion as to causation in law, including in the application of the scientific criteria to the facts. It should of course be borne in mind that common sense may not accord with what science can establish, and a layman must guard against substituting an untrained opinion for expert guidance, but that does not mean that common sense has no role to play in a judge’s fact finding.

In Zanner v Zanner (see 4.2, 4.9, 4.17), the same court first addressed the central factual causation issue, involving two ‘necessary conditions’, both of which contributed materially to the harm: the

child’s careless driving and his mother allowing him to drive unaccompanied. This was appropriately resolved by applying contributory negligence principles (see Chapter 10). The court then considered the normative considerations embraced by the ‘scope of liability’ provision citing New South Wales judgments that had engaged with this limb (at [79]): The most that can be extracted from the foregoing references is that this Court’s determination of whether it is appropriate for the scope of the … [child’s] liability to extend to the harm caused to the … [mother], is to be considered as a matter of common sense taking into account any relevant policy considerations that might assist in determining whether or not, and why, responsibility for the harm … should be imposed …

The court observed that in motor vehicle contexts, the circumstances in which policy considerations would allow for the denial of all causal responsibility once factual causation is satisfied would be rare. Here, no convincing policy reasons [page 246] could be advanced to justify not imposing causal responsibility on the child for the harm to his mother. The ‘appropriateness’ of imposing causal responsibility on solicitors with respect to an allegedly negligently drafted deed was considered in Hudson Investment Group Ltd v Atanaskovic (2014) 311 ALR 290; [2014] NSWCA 255. As was noted by the New South Wales Court of Appeal (Sackville AJA, with whom Beazley P and Ward JA agreed), the case was unusual, in that the Hudson Investment Group did not allege a failure by the solicitors to give effect to their instructions. Rather, the alleged negligence involved their choice of wording, which the plaintiff said was ambiguous and unclear, leading to uncertainty. With respect to causation, the court determined (at [126]) that ‘Hudsons’s claimed loss was a consequence of its own independent and unreasonable actions, or lack of action’, concluding (at [129]) that ‘it would not be appropriate for the scope of the solicitor’s liability to extend to the

damage claimed by Hudson’ seeing that Hudson had failed to avail itself of mechanisms included in the deed that would have averted its claimed loss. The court deliberately deferred deciding the alleged breach issue, with Beazley P observing (at [1]) that it had the potential to raise ‘a question of importance which is unnecessary to determine in this case’. Sackville AJA agreed (at [132], stating that ‘[o]biter dicta on a novel and potentially important issue of principle by an intermediate court of appeal are apt to generate uncertainty. The issue is best left to a case where it is necessary to decide’. Wallace v Kam was applied in Endeavour Energy v Precision Helicopters Pty Ltd [2015] NSWCA 169, with the New South Wales Court of Appeal divided with respect to the causal scope of liability determination. In this case, two employees of Endeavour Energy were conducting an aerial inspection of power lines, and Precision Helicopters had supplied the helicopter and pilot. The helicopter’s rear rotor came into contact with a catenary wire strung across a small gully by Telstra. The pilot managed to land the helicopter, but it rolled onto its side. The main rotor hit the cabin and Mr Edwards’s head, causing catastrophic injuries. Edwards, who was Endeavour’s inspector, settled with Endeavour, Precision and Telstra; Endeavour and Precision sought contribution. Regarding causation, the court unanimously held that the failure by Precision and Endeavour to provide Mr Edwards with a helmet and instructing him to wear it was causative of his injuries. The court also accepted that Precision was negligent because it failed to conduct a proper survey of the area before inspecting the power lines. However, even though such a survey would have prevented the accident due to a coincidental change in flight path (satisfying the ‘but for’ test), the scope of liability did not extend to the harm caused, as the catenary wire would have remained imperceptible. Sackville AJA (Macfarlan J agreeing) held (at [203]: ‘As a matter of legal policy, it is difficult to see why Precision should be held liable for a breach of duty that was unrelated to its failure to detect the hazard that materialised.’ Dissenting, Basten JA held (at [160]): ‘While the factors are finely balanced, in my view it was appropriate that liability for this negligence extend to the harm

caused to Mr Edwards.’ Sackville AJA had begun his judgment by acknowledging the case’s complexities, factually and legally. [page 247]

New intervening acts: part of the scope of liability inquiry 4.36 One area in which there is an abundance of case law concerning the attribution of causal responsibility involves what were (and are) frequently called ‘new intervening acts’ cases. These kinds of issues were canvassed in Harvey v PD and Travel Compensation Fund v Tambree. They involve factual or ‘necessary condition’ determinations, followed by an assessment of whether or not a later event should relieve the defendant of responsibility, based on policy, even though the ‘but for’ test is satisfied. They therefore sit within the statutes’ second causal limb, ‘scope of liability’ (in all jurisdictions except the Northern Territory). The ultimate question is one involving the appropriateness of the imposition of liability, having regard to a consideration of (among other relevant things) whether or not and why responsibility should be imposed. Because the statutes only offer guidance as to what the courts should do, the courts’ determinations must be informed by what has been done in the past. Many cases have explored attribution issues, which often use the language of causal chains, broken chains and new intervening acts (despite reservations expressed by Ipp JA in Harvey v PD). Establishing the negligent defendant’s causal responsibility for the plaintiff’s injuries or harm can be complicated when later events have some effect on the situation created by the defendant’s negligence. For example, if I negligently run down a pedestrian while driving my car, proof of my required causal responsibility is relatively simple. But what if the pedestrian’s injuries are subsequently made worse by negligent medical treatment at the nearby hospital? What if the pedestrian, depressed by the tragedy that has befallen her or him,

subsequently commits suicide? According to the simple ‘but for’ test, my negligent driving has caused everything that followed, including the injuries caused by the negligence at the hospital and the pedestrian’s eventual suicide, because none of these events would have happened without my negligence. However, the pedestrian’s death would also not have occurred but for the negligence of the hospital and her or his own voluntary decision to commit suicide. What caused her or his death? More particularly, did I cause her or his death, at least in terms of whether or not I should be held legally responsible? These questions involve the attribution of legal responsibility and underlying norms. Cases like this were (and are) often expressed in terms of a ‘chain of causation’. The court must determine whether each subsequent event is a necessary condition in the series of factual causes between the defendant’s negligence and the plaintiff’s injuries, or whether one of them has relieved the defendant of causal responsibility such that her or his conduct is outside the scope of liability. If the subsequent event takes the initial act outside the scope of liability, then it, and not the defendant’s negligence, is considered the cause (or, the ‘effective cause’ — a phrase that is out of favour) of the plaintiff’s injuries, for the purpose of the attribution of legal responsibility. The attribution of civil responsibility in the context of a damages award is the focus of the inquiry, as highlighted by the High Court of Australia in March v E & MH Stramare Pty Ltd (see 4.7, 4.44) and Chappel v Hart (see 4.26). Many cases have referred to a ‘chain-breaking’ subsequent event of this kind by using its Latin name, novus actus interveniens. [page 248] Key Case The Oropesa [1943] P 32 Facts: Two ships, the Oropesa and the Manchester Regiment collided as a result of

negligence on the part of the Oropesa. The master of the Manchester Regiment decided to cross to the Oropesa in a lifeboat to discuss salvage plans with the master of the Oropesa. The lifeboat capsized between the two ships, and nine of the 17 occupants died, including the plaintiffs’ son. The plaintiffs sued the owners of the Oropesa, alleging that their son’s death had been caused by the negligence of the Oropesa. Issue: Was the decision of the master of the Manchester Regiment to cross between the ships in a lifeboat a novus actus interveniens, as argued by the defendants? Decision: The Court of Appeal held that because there was an unbroken sequence of cause and effect between the negligence on the Oropesa and the death of the plaintiffs’ son, the plaintiffs’ action succeeded. Lord Wright (with whom Scott and MacKinnon LJJ agreed) said (at 39): To break the chain of causation it must be shown that there is something which I will call ultroneous, something unwarrantable, a new cause which disturbs the sequence of events, something which can be described as either unreasonable or extraneous or extrinsic. I doubt whether the law can be stated more precisely than that.

The subsequent event: ‘ultroneous’, ‘unwarrantable’, ‘unreasonable’, ‘extraneous’ or ‘extrinsic’? 4.37 To say that a subsequent event is a novus actus interveniens if it is ‘ultroneous’, ‘unwarrantable’, ‘unreasonable’, ‘extraneous’ or ‘extrinsic’ is merely to state a conclusion, rather than to explain it.9 An ‘extrinsic’ event is obviously not one that is part of the chain of causation leading from the defendant’s negligence: that is why it can be described as ‘extrinsic’. What this terminology does not explain is when and why a subsequent event can be described as ‘ultroneous’ or ‘extrinsic’. The next case explores that question more closely. Key Case Haber v Walker [1963] VR 339 Facts: The plaintiff’s husband suffered horrific injuries in a motor vehicle accident. He suffered some physical brain damage, and also became profoundly depressed as a result of the condition in which his injuries had left him. His psychiatric condition and sense of hopelessness worsened, and eventually he committed suicide. The plaintiff, his widow, sued the defendant, the driver of the other car in the collision, alleging that her husband’s death was caused by the defendant’s negligence.

[page 249] Issue: Did the act of suicide break the causal chain? Decision: At first instance, the jury held that the defendant had been negligent, and that that negligence had caused the plaintiff’s death. The defendant appealed. On appeal, the Full Court of the Supreme Court of Victoria dismissed the appeal by a majority of two to one. Smith J said (at 358): [An] act or omission is to be regarded as a cause of the harm unless there intervenes between the act or omission and the harm an occurrence which is necessary for the production of the harm and is sufficient in law to sever the causal connexion … [T]he intervening occurrence, if it is to be sufficient to sever the connexion, must ordinarily be either: (a) human action that is properly to be regarded as voluntary, or (b) a causally independent event the conjunction of which with the wrongful act or omission is by ordinary standards so extremely unlikely as to be termed a coincidence … A majority of the Full Court held that the suicide could not properly be regarded as a ‘voluntary human action’. His mental state had deprived the plaintiff’s husband of the capacity to make a free choice. Thus, the suicide was not a novus actus interveniens and the plaintiff’s action succeeded.

In a number of cases, the judgment of Smith J in Haber’s case is still used as the starting point for a consideration of novus actus interveniens questions. These days, because of the statutory directive to use the two-limbed approach, Haber’s novus actus interveniens language and reasoning can be reframed as to whether there is a factual connection justifying the imposition of responsibility: is it appropriate for the scope of the negligent person’s liability to extend causally to the harm? Why should responsibility for the harm be imposed on the negligent (‘faulty’, in Western Australia) party?

The ‘voluntary’ (volitional) act of the plaintiff or a third party: what are its ‘qualities’? 4.38 Although Smith J’s framework in Haber v Walker (see 4.37) is helpful when trying to determine whether or not the defendant should be causally responsible, in that the questions are outlined clearly, it

offers little assistance in determining how the ‘voluntariness’ of subsequent human action or the ‘causal independence’ of a subsequent event are to be identified. In cases involving conduct that could be considered ‘voluntary’ human conduct, the act that is at issue can be that of the plaintiff herself or himself (as in Haber) or that of a third party (as in Rickards v Lothian [1913] AC 263, where a vandal clogged up a washbasin with nails, then turned the water tap on full, causing flooding that damaged the plaintiff’s property several floors below). Case law offers guidance with respect to what courts look for to determine whether or not responsibility will be attributed to the initial negligent factual cause under scrutiny. What are its qualities? It appears that the person’s act must be fully volitional, and that person must have a complete understanding of the consequences of her or his [page 250] act. In Rickards, the vandal’s actions were held responsible for the damage because she or he was acting with volition. Further, she or he must have had an understanding of the consequences of the act. By way of contrast, in Haber, the act of suicide could not be said to be one of free will, as the deceased had been acting under the influence of his severe depression, without genuine (and necessary) volition. A similar rationale underlies the decision in Urbanski v Patel (1978) 84 DLR 650, where a young woman underwent a sterilisation procedure (tubal ligation), during which the doctor negligently removed her kidney — her only kidney — thinking he was removing an ovarian cyst. Her father donated his kidney to his daughter. Unfortunately, his daughter rejected the transplanted kidney. She remained on dialysis. Her father successfully sued the doctor for the damage he suffered, from donating his kidney. The Manitoba Queen’s Bench (in Canada) held that the father’s act of (attempted) rescue was

not an act that relieved the defendant of causal responsibility for the harm, as the father’s act of rescue was not truly volitional. 4.39 For comparative purposes, the following authorities help illustrate what some judges consider to be volitional conduct. Case Example Yates v Jones (1990) Aust Torts Reports ¶81-009 Facts: A 17-year-old was injured in a motor vehicle accident caused by the defendant’s negligence. She suffered injuries typically related to that sort of incident, including chest pains and lacerations. She was hospitalised and, according to her evidence, given insufficient pain relief medication considering her discomfort. A ‘casual acquaintance’ visited her in the hospital and suggested she try some heroin as pain relief. She resisted. On his third visit, she agreed, and he injected her with the drug. She developed an addiction to heroin, which she supported by criminal activity, including theft and prostitution. She sued the defendant and her claim was successful at trial. Issue: Were there intervening causes that relieved the driver of causal responsibility for her addiction and associated harm? Decision: On appeal to the New South Wales Court of Appeal, Meagher JA denied the contentious part of her claim for damages, which was connected to her subsequent addiction. He characterised (i) the drug dealer’s conduct and (ii) her own act of injecting the drug as new intervening acts. Kirby P dissented, concluding that her own conduct was not truly volitional, but the product of her vulnerability and great pain. Ultimately, the majority (Samuels and Meagher JJA) appears to have been influenced by its assessment of public policy considerations, and the normative effect of the criminal law on civil liability (as in State Rail Authority of New South Wales v Wiegold (1991) 25 NSWLR 500: see 4.49). As was the case in Wiegold, Kirby P’s dissent in Yates (at 67,635) squarely addresses these public policy concerns, cautioning the court to ‘guard against preconceptions and emotional responses to claims such as the present’. This case also considered remoteness of harm principles, which now would be a normative question addressed as part of ‘scope of liability’.

[page 251] Case Example CES v Superclinics (Aust) Pty Ltd (1995) 38 NSWLR 47

Facts: Careless doctors did not detect a young woman’s pregnancy. When her pregnancy was finally diagnosed, she was too far along in her pregnancy to have an abortion. She claimed damages against the doctors for the cost of raising her healthy child. Issue: Was the plaintiff’s own conduct, not giving up her newborn child for adoption, a new intervening act? Decision: Priestley JA was the only judge to characterise the mother’s conduct as a new intervening act. He stated (at 84): The point in the present case is that the plaintiff chose to keep her child. The anguish of having to make the choice is part of the damage caused by the negligent breach of duty, but the fact remains, however compelling the psychological pressure on the plaintiff may have been to keep the child, the opportunity of choice was in my opinion real and the choice made was voluntary. It was this choice which was the cause, in my opinion, of the subsequent cost of rearing the child.

More generally, the New South Wales Court of Appeal held against the plaintiff’s ‘wrongful birth’ claim for wide-ranging reasons. The controversial case, Cattanach v Melchior (2003) 215 CLR 1; 199 ALR 131 (see 12.2), also involved a mother and father’s claim against a doctor for the cost of raising a ‘healthy’ child, when they had deliberately planned to not have any more children. However, unlike the plaintiff in CES, who failed at the New South Wales Court of Appeal for varying reasons, the plaintiffs in Cattanach succeeded at the High Court of Australia, with the court divided four to three. However, causal responsibility issues were not canvassed by the court, presumably because the doctor’s failure was a factual cause of their harm, and it was within the scope of his liability (although this case was not determined under a Civil Liability Act). Despite the fact that in theory an argument like that considered by Priestley JA in CES v Superclinics (Aust) Pty Ltd (see above) could have been brought, it was not raised, no doubt because it would be seen to be presumptuous and repugnant. The doctor’s failure remained the operative cause of their harm, for which responsibility should lie. 4.40 In Haynes v G Harwood & Son [1935] 1 KB 146, the English Court of Appeal held that the causal chain was not broken by a child who threw stones at an unattended horse-drawn van that was carelessly left

by a delivery person on a street. The defendant employer of the delivery person was held to be causally responsible for the injuries sustained by a police officer who attempted to prevent the van’s horses from running down people on the street. Even though the child’s act was volitional, he did not fully understand the consequences of what he did. It therefore did not qualify as a new intervening act and did not relieve the defendant of responsibility. To reframe this case using the modern approach and language, the defendant’s careless conduct was clearly a factual cause or necessary condition of [page 252] the ultimate harm and the scope of the defendant’s liability extended to the harm. Therefore, finding liability was appropriate. The fact that this arose in the context of a rescue and in the absence of fully volitional conduct where the consequences were fully understood (by both the plaintiff and third party) provides the normative rationale for reaching this conclusion. 4.41 In some cases, even conduct that appears ‘volitional’ may still be held to be caused by the defendant’s negligent conduct, which created the situation that prompted the plaintiff’s response. The next case illustrates this point. Key Case Medlin v State Government Insurance Commission (1995) 182 CLR 1; 127 ALR 180 Facts: The plaintiff, a professor, was injured in a motor vehicle accident. He returned to work, but because of the effects of the accident, felt he was unable to discharge his responsibilities as a researcher. He retired four-and-a-half years early. There was no indication that the university would have asked him to retire prematurely as it was satisfied with the way in which he was fulfilling his responsibilities. Issue: Did the injuries resulting from the driver’s negligence cause the loss of earning capacity associated with the plaintiff’s early retirement?

Decision: The High Court held in the plaintiff’s favour, as his decision to retire prematurely was not entirely voluntary. It acknowledged the complications that arise in cases like this, where there is the intervention of an act or decision of a third party or, as here, the plaintiff, which is a more immediate (factual) cause of the loss or damage. Initially using the language of ‘breaking the chain of causation’, the court held that the ultimate decision must be one based on whether the defendant’s act or omission is seen to properly be the cause of the harm; in doing so, it referred to ‘common sense and experience’. It then queried the use of ‘intervention’ language in some circumstances. Deane, Dawson, Toohey and Gaudron JJ stated in their joint judgment (at CLR 6; ALR 183): Indeed, in some cases, it may be potentially misleading to pose the question of causation in terms of whether an intervening act or decision has interrupted or broken a chain of causation which would otherwise have existed. An example of such a case is where the negligent act or omission was itself a direct or indirect contributing cause of the intervening act or decision. The High Court held that this was such a case, in that it did not matter that the ‘immediate trigger’ for his terminated employment was his decision to retire prematurely. The fact that he could have continued at the university, albeit in chronic and sometimes intense pain, did not defeat his claim for loss of earning capacity. The court held (at CLR 11; ALR 187): The effects of the accident were that his routine administrative and teaching work used up all his energy with the consequence that he was incapable of doing the research and creative work which he desired to carry out and which, one would think, would be and should be expected of the holder of the Chair of Philosophy in a major university. In these circumstances, the relevant question was not whether the plaintiff [page 253] ‘should’ have continued in his university post or whether his decision to retire was not ‘reasonable’ but whether, in the context of what was reasonable between the plaintiff and the defendant in determining the defendant’s liability in damages, the premature termination of the plaintiff’s employment was the product of the plaintiff’s loss of earning capacity notwithstanding that it was brought about by his own decision to accept voluntary retirement.

Case Example Hirst v Nominal Defendant

[2005] Qd R 133 Facts: An on-duty police officer (then a senior constable) in a police car pursued an unidentified blue car in a high-speed chase down the Bruce Highway. The police vehicle, with all lights and sirens activated, was travelling at speeds as high as 175 km per hour. At one point, the officer needed to brake heavily, as a result of which he lost control of his vehicle and it began to skid. He was injured when his vehicle hit the side of a trailer being pulled by a utility vehicle. Issue: Was the officer’s injury the result of his own deliberate voluntary (or abnormal) act, which had broken the chain of causation? Decision: The Queensland Court of Appeal unanimously upheld the trial judge’s finding against the Nominal Defendant, that the negligence of the unidentified driver of the blue car caused the officer’s injury (with a one-third reduction for contributory negligence). Keane JA (with whom Jerrard JA and Douglas J agreed) stated (at [18]): The driver of the blue car, by acting as he did in circumstances where he knew he was being pursued by a police officer acting in the course of his duty, created a situation of radically heightened risk by making continued and accelerated pursuit likely. … In these circumstances … the driver of the blue car caused Mr Hirst’s injury, in that Mr Hirst’s ‘voluntary’ attempts to deal with the situation created by the driver of the blue vehicle did not constitute a novus actus interveniens or break the chain of causation. Relying on Medlin v State Government Insurance Commission, Keane JA said (at [29]): … Medlin confirms the propositions that voluntary or deliberate or unusual conduct on the part of a plaintiff does not necessarily sever the causal nexus so as to relieve a negligent defendant from liability for loss suffered by a plaintiff; and that it is necessary to have regard to the extent to which the plaintiff’s voluntary conduct has been constrained by the defendant’s misconduct, and then to ask whether as between plaintiff and defendant it was reasonable of the plaintiff to make the choice which was the immediate cause of the loss. … Further, while … [these propositions] recognise that there may be a point at which it is possible to say that it is not reasonable as between the plaintiff and defendant that the defendant is responsible for the voluntary conduct of the plaintiff, eg because the choice made by the plaintiff may be so unexpected a response to the defendant’s conduct that the defendant should not bear any of the consequences of that decision, it cannot be said that this point was reached in this case. …

[page 254] ‘Causal chain’ issues were canvassed in Knott Investments Pty Ltd v

Fulcher [2014] 1 Qd R 21, which applied Medlin (see 1.12).

Is foreseeability relevant in this context? 4.42 The courts have, in some instances, used the test of reasonable foreseeability to help determine whether or not a subsequent event relieves the defendant of responsibility. In Rickards v Lothian (see 4.38), the absence of foreseeability crept into the court’s reasoning, in which it found that the third party’s act of vandalism relieved the defendant of responsibility, because the third party vandal’s act broke the chain of causation. Mahony v J Kruschich (Demolitions) Pty Ltd (1985) 156 CLR 522; 59 ALR 722 (see 4.43) helps illustrate this point in the context of intervening conduct that is not volitional, but careless.

Subsequent intervening event: one negligent act followed by another negligent act: a ‘matter of fact [or circumstance] and degree’ 4.43 As was noted earlier, courts have to assess whether or not the subsequent intervening event should be seen to sever the chain of causation in cases involving allegedly volitional conduct, as well as cases involving later events that can be characterised as careless. The following case considers the kind of test that should be used to determine if that later event should relieve the factual cause of ultimate legal responsibility. Key Case Mahony v J Kruschich (Demolitions) Pty Ltd (1985) 156 CLR 522; 59 ALR 722 Facts: A worker, Glogovic, was injured in a workplace accident. He sued his employer, alleging that his injuries had been caused by its negligence. The employer cross-claimed against a doctor, Mahony, alleging that Mahony had negligently treated Glogovic’s injuries, and that Mahony’s negligence had caused or contributed to Glogovic’s eventual disabilities, which were the basis of his action against his employer. Mahony sought to have the cross-claim struck out. Issue: In the proceedings to have the cross-claim struck out, one issue was whether

Mahony’s negligence (if any) was a novus actus interveniens between the alleged negligence of the employer and Glogovic’s disability. Decision: The High Court of Australia unanimously held that the cross-claim should not be struck out, and that the trial should proceed with Mahony as a party. Gibbs CJ, Mason, Wilson, Brennan and Dawson JJ said (at CLR 529–30; ALR 726–7): When an injury is exacerbated by medical treatment … the exacerbation may easily be regarded as a foreseeable consequence for which the first tortfeasor is liable. Provided [page 255] the plaintiff acts reasonably in seeking or accepting the treatment, negligence in the administration of the treatment need not be regarded as a novus actus interveniens which relieves the first tortfeasor of liability for the plaintiff’s subsequent condition. The original injury can be regarded as carrying some risk that medical treatment might negligently be given … [I]n the ordinary case where efficient medical services are available to an injured plaintiff, the original injury does not carry the risk of medical treatment or advice that is ‘inexcusably bad’ … In such a case, it is proper to regard the exacerbation of a plaintiff’s condition as resulting solely from the grossly negligent medical treatment or advice …

In Thorpe Nominees Pty Ltd v Henderson & Lahey [1988] 2 Qd R 216, the principles stated in Mahony’s case were applied to a case of subsequent negligent advice by a solicitor. Burns v Pearce (2010) 57 MVR 136; [2010] WASCA 214 involved a driver who collided with a cow on a road. Another driver, following 400 metres behind, collided with the prostrate cow. The Western Australia Court of Appeal had to decide if the second driver’s collision was brought about by the first driver’s negligence. The plaintiff’s (appellant’s) claim failed for a number of reasons. However, with respect to causation, the court cited March v E & MH Stramare Pty Ltd (see 4.44), noting that the defendant’s act need not be the sole cause as long as it materially contributed to the damage, and that common sense should be used. Using the language of Mahony (see 4.43) and Chapman v Hearse (see 4.44), the Court of Appeal reversed the trial judge’s finding that the plaintiff’s own carelessness was a new intervening act (or contributory negligence) (at [115]):

The appellant’s conduct in the management of his vehicle after the respondent’s collision was not so unexpected or unreasonable a response to her collision and the consequences it produced … that the respondent should be relieved from any liability for any proportion of the appellant’s loss.

In cases like Mahony and Chapman v Hearse (see 4.44), involving one negligent act followed by another negligent act (as opposed to voluntary human intervention), the High Court of Australia has stated that the determination of whether or not the intervening event severed the causal connection, taking the defendant’s act or omission outside the scope of her or his liability, was a matter of ‘fact and degree’ (Mahony) or ‘circumstance and degree’ (Chapman). 4.44 It could be argued (despite what was said in Mahony’s case (see 4.43)), that reasonable foreseeability of the subsequent event should not be relevant to the question of whether or not the defendant’s negligence caused the plaintiff’s injury, because reasonable foreseeability is concerned with possibilities whereas causation is concerned with proof on the balance of probabilities. Because of this concern, some cases have held that the reasonable foreseeability of the subsequent event is not relevant to the question of causation. [page 256] Key Case Chapman v Hearse (1961) 106 CLR 112 Facts: A car overturned as a result of the negligence of its driver, Chapman. A doctor named Cherry went to the assistance of Chapman, who had been thrown free from his car and was lying injured on the road. While Dr Cherry was tending to Chapman’s injuries, he was run over and killed by another car, driven by a man (appropriately) named Hearse. Dr Cherry’s estate sued Hearse, alleging that his death had been caused by Hearse’s negligence. Hearse joined Chapman as a third party, alleging that Dr Cherry’s death had been caused by Chapman’s original act of negligence, overturning his car. Issue: One issue was whether Hearse’s negligent driving was a novus actus interveniens, severing the chain of causation between Chapman’s original act of negligence and Dr Cherry’s death.

Decision: The High Court of Australia held that Hearse’s negligence was not the sole cause of Dr Cherry’s death. Dixon CJ, Kitto, Taylor, Menzies and Windeyer JJ said (at 122): In effect, the argument of [Hearse] proceeded upon the basis that if the ultimate damage was ‘reasonably foreseeable’ that circumstance would conclude this aspect of the matter against [Chapman]. But what this argument overlooks is that when the question is whether damage ought to be attributed to one of several ‘cause’ there is no occasion to consider reasonable foreseeability on the part of the particular wrongdoer unless and until it appears that the negligent act or omission alleged has, in fact, caused the damage complained of. As we understand the term ‘reasonably foreseeable’ is not, in itself, a test of ‘causation’; it marks the limits beyond which a wrongdoer will not be held responsible for damage resulting from his wrongful act. This distinction is of some importance in cases such as the present where there have been successive acts of negligence and where it is sought to establish, notwithstanding the fact that the ultimate consequence might have been reasonably foreseeable at the time of the earlier act of negligence, that the later negligent act was the sole cause of the damage complained of.

The role of reasonable foreseeability in ‘mark[ing] the limits beyond which a wrongdoer will not be held responsible for damage resulting from his wrongful act’ is a question of remoteness of damage, which is considered below. Furthermore, notwithstanding the concern expressed in Chapman about the use of foreseeability in the causation context, the next case shows, as did Mahony (see 4.43) that in some cases it has been considered appropriate to use reasonable foreseeability as the test for whether a subsequent event constitutes a novus actus interveniens. In modern (statutory) terms, the issue is, should the later event eliminate the defendant’s responsibility for the plaintiff’s harm, such that the negligent party’s scope of liability does not extend that far? In March v E & MH Stramare Pty Ltd (see 4.7) the High Court of Australia had to determine if the plaintiff’s own negligence in driving into the back of a parked truck was a novus actus interveniens. Mason CJ (with whom Toohey and Gaudron JJ agreed) said (at CLR 517–19; ALR 431–2):

[page 257] [T]he ‘but for’ test does not provide a satisfactory answer in those cases in which a superseding cause, described as a novus actus interveniens, is said to break the chain of causation which would otherwise have resulted from an earlier wrongful act … The fact that the intervening action is deliberate or voluntary does not necessarily mean that the plaintiff’s injuries are not a consequence of the defendant’s negligent conduct … It has been said that the fact that the intervening action was foreseeable does not mean that the negligent defendant is liable for damage which results from the intervening action: see Chapman v Hearse … But it is otherwise if the intervening action was in the ordinary course of things the very kind of thing likely to happen as a result of the defendant’s negligence … As a matter of both logic and common sense, it makes no sense to regard the negligence of the plaintiff or a third party as a superseding cause or novus actus interveniens when the defendant’s wrongful conduct has generated the very risk of injury resulting from the negligence of the plaintiff or a third party and that injury occurs in the ordinary course of things. In such a situation, the defendant’s negligence satisfies the ‘but for’ test and is properly to be regarded as a cause of the consequence because there is no reason in common sense, logic or policy for refusing to so regard it.

The logic embraced by the latter part of this statement is considered at 4.47–4.48. The court held that on these facts, the defendant was negligent in parking its car in the middle of the road precisely because it was reasonably foreseeable ‘in the ordinary course of things’ that drivers, drunk or sober, might drive into the back of it. In cases like this, where the subsequent event is the very thing that the defendant should have taken reasonable care to guard against, it would make no sense to hold that the subsequent event should be regarded as the sole cause of the plaintiff’s injuries once it eventuates. The defendant was held liable, with a finding of contributory negligence imposed on the plaintiff. Like March v E & MH Stramare Pty Ltd, the following case was decided at a time that pre-dates the Civil Liability Acts. As we have highlighted several times, these days, under these statutes, courts must consider normative, policy-oriented matters — whether it is appropriate for the scope of the negligent (or faulty, in Western Australia) person’s liability to extend to the harm. Case Example

Bennett v Minister of Community Welfare (1992) 176 CLR 408; 107 ALR 617 Facts: The 16-year-old plaintiff was injured in 1973, while being ‘trained’ at a detention centre run by the defendant. Because the plaintiff was a ward of the state, the defendant accepted that it owed him a duty to obtain independent legal advice about his right to recover damages against it. The defendant negligently failed to do that. In 1976, the plaintiff was no longer a ward of the state. He sought legal advice from a barrister, who incorrectly advised him that he had no right to sue the defendant in a negligence action. In 1979, the plaintiff’s right to sue the defendant with respect to his injuries became barred by statute. The plaintiff later sued the [page 258] defendant, alleging that he had lost his right to sue in respect of his injuries because of the defendant’s negligent failure to obtain independent legal advice for him. The defendant admitted that it had been negligent. Issue: Was the incorrect advice given in 1976 by the barrister a novus actus interveniens and the sole cause of the plaintiff’s loss? Decision: Mason CJ, Deane and Toohey JJ (at CLR 413; ALR 619) rejected this argument: The inadequacy of the ‘but for’ test has emerged in cases in which a superseding cause, amounting to a novus actus interveniens, has been held to break the chain of causation which would have otherwise resulted from an earlier wrongful act or omission. … [T]hough the earlier wrongful act or omission may have amounted to an essential condition of the occurrence of the ultimate harm, it was not the true cause or a true cause of that harm. Their Honours held that the 1976 advice was based on incorrect and self-serving information given by the defendant. They concluded (at CLR 414; ALR 620): In considering whether the obtaining of the 1976 advice [was a novus actus interveniens], the first and most significant point to be made is that, if the [defendant] had performed his duty and obtained independent legal advice, there would have been no occasion for the [plaintiff] to seek advice in 1976. In other words, the [plaintiff] sought and obtained advice because, and only because, the [defendant] was in breach of his duty of care. That circumstance in itself makes it difficult, if not impossible, to conclude that, in the situation described, the 1976 advice superseded the [defendant’s] breach of duty as the sole cause of the subsequent loss.

Did the defendant’s breach shape the subsequent

event? 4.45 When the simple ‘but for’ test is applied in cases of multiple acts or events, it always gives the answer that the first event (the defendant’s negligence) must be regarded as a cause, notwithstanding the effect of the later events, because none of the later events would have occurred but for the first event. Although this was identified as a defect of the test in both March v E & MH Stramare Pty Ltd (see 4.7, 4.44) and Bennett v Minister of Community Welfare (see 4.44), it seems that the majority in Bennett took what was essentially a ‘but for’ approach, by asking what would have happened if the defendant had not been negligent and had obtained independent (and presumably correct) legal advice for the plaintiff. Unsurprisingly, this led to the conclusion that the first event was a cause of the plaintiff’s loss. 4.46 Instead of considering what would have happened if the defendant had not been negligent, it is better if the courts look at the situation actually created by the defendant’s negligence, and consider the extent to which the subsequent event is shaped by that situation. The first event is a necessary condition of the later event, because the later event would not have occurred at all but for the first event. However, the later event should relieve the defendant of responsibility (as a novus actus interveniens) only if there is anything significant about it that is not conditioned or shaped by the situation created by the first event. If the situation [page 259] created by the first event is more than just a necessary condition of the later event, because it shaped the later event to some significant extent, then the later event should not be regarded as a novus actus interveniens. In a sense, this could be said to involve an assessment of the ‘causal potency’ of the defendant’s wrong. That is what it means to say that a subsequent event is ‘ultroneous’ or ‘extrinsic’: that it is not predominantly conditioned or shaped by the

situation created by the first event. Thus, in The Oropesa (see 4.36), the decision of the captain of the Manchester Regiment to cross to the Oropesa in a lifeboat was largely, if not solely, conditioned by the situation of crisis created by the negligence of the Oropesa. If, however, the captain had responded to that situation by ordering the plaintiffs’ son to try to swim to the Oropesa to take a message, that response could properly be regarded as a novus actus interveniens. The captain’s decision to send a swimmer into the storm rather than sending a lifeboat would not be conditioned solely or even predominantly by the situation created by the defendant’s negligence, but by the captain’s wholly unrealistic assessment of the dangers of the storm and a swimmer’s chance of surviving it. Similarly, in Haber v Walker (see 4.37), the plaintiff’s husband’s decision to commit suicide was predominantly conditioned or shaped by the situation created by the defendant’s negligence, because the very manner in which the plaintiff’s husband made decisions had been altered by that situation. In other situations, though, suicide by an injured person may be a novus actus interveniens. Unless the situation created by the defendant were to put the injured person into the extremes of grief and pain suffered by Joseph Haber, any decision by that person to commit suicide could arguably be regarded as being conditioned primarily by an exercise of her or his own free will. (With respect to this type of consideration, note Telstra Corp Ltd v Smith (1998) Aust Torts Reports ¶81-487, where the Court of Appeal of New South Wales held that the plaintiff’s attempted suicide was sufficiently causally connected to the defendant’s negligence to give rise to liability.) In March v E & MH Stramare Pty Ltd (see 4.7 and 4.44), the plaintiff’s drunkenness was not conditioned by the defendant’s negligence in any way. However, it is impossible to conclude that the event of the collision between the plaintiff’s car and the defendant’s van was not predominantly shaped by the defendant’s negligence, simply because the collision would not have occurred but for the van being there.

Was the subsequent event the very kind of thing the

defendant ought to have guarded against (linked to scope of duty)? 4.47 If you purchase a burglar alarm that is carelessly manufactured, install it in your flat and are burgled, the volitional conduct of the third party thief would not be characterised by a court as a new intervening act, such that the defendant manufacturer would be relieved of responsibility. The theft of goods is the very thing that was to be guarded against, because the scope of the manufacturer’s duty of care extends to preventing that harm from occurring. In such a case, using the statutory language, the scope of liability for the manufacturer’s breach would extend to the plaintiff’s damage, because of the nature of its duty to consumers. [page 260] 4.48 In Club Italia (Geelong) Inc v Ritchie (2001) 3 VR 447 (see 6.22), the Victorian Supreme Court, Court of Appeal found that the organisers of a debutante ball that got out of control owed a duty of care to police who attended the scene. The club had not ejected a potential troublemaker that evening, and did not warn the police of the increasingly raucous (criminal) behaviour at the ball. The responding officer, who was beaten severely by some of the patrons, successfully sued the club. Having found that the scope of the duty of care owed by the club to the officer extended to the exceptional case of controlling the conduct of a third party, it would have been illogical for the court to have held that the club’s liability should be negated at the causation stage, as this was the very thing the club should have guarded against. Imposing responsibility for the plaintiff’s harm was appropriate, bearing in mind what the duty of care encompassed. It was appropriate for the scope of the negligent club’s liability to extend to the harm so caused. Even though it was not relevant to the ultimate determination, Mossop AsJ in Jausnik v Nominal Defendant (No 5) (2016) 78 MVR 1;

[2016] ACTSC 306 (see 4.9) rejected the submission that the criminal actions at issue constituted a new intervening act. His Honour held (at [187]): [A] novus actus interveniens does not arise when the new act involves the very risk brought about by the negligence of the defendant: McLean v Tedman [1984] HCA 60; (1984) 155 CLR 306. Mr Williams’ offending behaviour, including his reckless and intoxicated driving, provided the context in which Mr Hannaford performed his duties. It was not a matter separate from the causal chain of events. Instead it was a reasonably foreseeable risk arising from the decision by Mr Hannaford to continue the pursuit of Mr Williams’ vehicle as far as he did.

Case Example Gittani Stone Pty Ltd v Pavkovic (2007) Aust Torts Reports ¶81-924; [2007] NSWCA 355 Facts: Over a lengthy period of time, one employee, Mr Lee, committed a series of unprovoked attacks on his co-employee, Mr Pavkovic (the plaintiff and respondent). These acts of violence were not effectively addressed by their employer (the defendant and appellant). On one occasion, a particularly serious altercation occurred (following two days of abuse). Pavkovic reproached Lee, who became angry and threatening. Their employer told Pavkovic to stay away from Lee because Lee was ‘sick’. After a weak (and misguided) attempt at reconciliation failed, Lee left the workroom, without permission. He was overheard to say that he ‘would be waiting’ or ‘would be outside’. As Pavkovic went to his car, Lee drove up and shot him. Pavkovic was seriously injured. Issue: Did the employer’s breach of its duty of care, not dismissing Lee after repeated incidents of violence (not providing a safe workplace), cause Pavkovic’s injury? Decision: The New South Wales Court of Appeal unanimously upheld the decision in favour of Pavkovic. With respect to ‘but for’ causation, Hodgson JA took a ‘robust and common sense approach’ (as did Ipp JA), concluding that, on [page 261] a balance of probabilities, the shooting would not have occurred had it not been for the employer’s breach (unlike the conclusion reached on the facts of Adeels Palace (see 4.8), decided after Gittani and under the New South Wales statutory framework). Hodgson, Ipp and McColl JJA held that despite the fact the shooting was the volitional act of a third party, this did not ‘interrupt’ the causal chain, as it was the very kind of thing that was meant to be prevented by an employer protecting its employee.

Explicit consideration of normative questions: examples

4.49 The results in several cases noted previously, such as Haber v Walker (see 4.37), appear to have been driven by policy considerations, without their explicit articulation. By way of contrast, in Yates v Jones (see 4.39) Kirby P did articulate what he perceived to be the ‘normative’ concerns. Indeed, policy is at the forefront of the reasoning in the following case examples. They illustrate how judicial opinions can differ when making determinations as to whether or not and why responsibility for the harm should be imposed on the negligent party. Case Example State Rail Authority of New South Wales v Wiegold (1991) 25 NSWLR 500 Facts: The plaintiff was a maintenance linesman employed by the defendant. He was injured when he fell down a railway embankment at night. He could not see where he was going because the torch the defendant had given him was not working. After the accident, the plaintiff was unable to work. He received workers’ compensation payments. He began to worry about how he could support his family once these payments ran out. He began to grow Indian hemp, intending to produce and sell marijuana. He was arrested, convicted and imprisoned. Issue: Was the plaintiff’s imprisonment caused by the defendant’s negligence, because the former would not have happened but for the latter? Decision: A majority of the Court of Appeal of New South Wales held that, as a matter of policy, the court should not hold that the imprisonment was caused by the defendant’s negligence. Samuels JA said (at 514): If the plaintiff has been convicted and sentenced for a crime, it means that the criminal law has taken him to be responsible for his actions, and has imposed an appropriate penalty. He or she should therefore bear the consequences of the punishment, both direct and indirect. If the law of negligence were to say, in effect, that the offender was not responsible for his actions and should be compensated by the tortfeasor, it would set the determination of the criminal court at nought … Hence, the application of the simple ‘but for’ test to determine causation would be singularly inappropriate in this case. In all the circumstances, it would be quite unreal to find that the [defendant] caused the [plaintiff] to engage in criminal conduct. [page 262] Dissenting, Kirby P held (at 505): [The plaintiff] was duly punished according to the criminal law. [The trial judge]

plainly felt that he should not be punished twice by then being denied the economic consequences which otherwise flowed from the injuries done to him by the negligence of the [defendant].

In cases like Wiegold, significant policy questions arise that generate clear differences of opinion in response to them. Therefore, not surprisingly, predicting results can be a fraught task. As was noted earlier, in Yates v Jones (see 4.39) the court also considered the alleged voluntariness of the plaintiff’s conduct when she used heroin and whether ‘causal connections’ were maintained despite her own conduct using the drug and the conduct of the drug dealer — a third party. Remoteness of harm issues also arose. Kirby P handed down a particularly strong dissenting opinion, stating that the court should not hold against the plaintiff simply because of her illegal drug use, which he noted was a fact of life in parts of Sydney. In Yates, Wiegold and similar cases, courts articulate important conceptions of the role of the civil law, including how it should sit alongside criminal regulation and how the civil law should not be seen to condone behaviour that is frowned upon by the community. 4.50 The following widely reported and controversial case also touched on causal attribution issues in the context of the plaintiff’s own actions contributing to his harm, with judicial opinion again divided with respect to the effect of policy considerations on the result. The case primarily canvassed issues associated with the scope of the relevant duty of care in the circumstances (see 5.9–5.17), which was closely connected to the court’s causal responsibility determination, to which, as Santow JA stated (at [381]), ‘normative considerations are brought to bear’. Case Example Hunter Area Health Service v Presland (2005) 63 NSWLR 22 Facts: In 1995, the plaintiff killed his future sister-in-law, Ms Laws, at her home (where she lived with his brother). The previous day, he had been brought to a public hospital by police after ‘an episode of bizarre and violent behaviour’ (at [122]). He was treated,

taken to another public psychiatric hospital for assessment, admitted as an informal or voluntary patient and then discharged, in the company of his brother. Six hours later, he killed Ms Laws. He was found not guilty of murder on grounds of mental illness, but was detained as a ‘forensic patient’ in a psychiatric hospital. Issues: Were the health authority and doctor (Dr Nazarian) liable for failing to conduct a proper inquiry into the plaintiff’s mental state and failing to compulsorily detain him? Were these failures the cause of his 18-month detention, distress and economic loss? [page 263] Decision: The plaintiff succeeded at first instance, arguing that had the defendants not been careless, they would have diagnosed his psychosis, he would have been detained as an involuntary patient and this would have averted his act of killing his brother’s fiancée. Sheller and Santow JJA reversed the trial judgment; Spigelman CJ dissented. After citing a series of decisions involving causation and public policy, including March v E & MH Stramare Pty Ltd (see 4.7), and State Rail Authority of New South Wales v Wiegold (see 4.49), Sheller JA noted that had the plaintiff been convicted of murder, his intention to kill would have broken the causal chain, and public policy would have operated to deny him recovery. Sheller JA stated (at [295]), ‘[p]ublic policy must loom large in a court’s consideration of whether the plaintiff be compensated for the harm so suffered’. After a lengthy survey of authorities, Sheller JA ultimately determined this issue using the sometimes derided concept, ‘common sense’. With respect to logical concerns, Santow JA noted (at [370]): There is indeed an incongruity in bringing an action based in part on loss of liberty when the loss is attributed to an earlier failure to deprive the person compulsorily of that same liberty, albeit for a much shorter time. Having characterised the claim as one for the non-physical consequences following the plaintiff’s act of homicide while insane (at [381]), Santow JA continued (at [383]): While I agree that the unlawfulness of an act of homicide committed while insane should not be an automatic bar to recovery, I respectfully disagree that it has no weight when it comes to determining what consequences of such actions should give rise to civil liability in negligence. Legal policy treats insanity as an ‘excuse’, though not justification, for what remains an unlawful act. … But considerations of coherence as well as difficulties of causation lead it in my view to draw the line at permitting recovery by the person who committed that act for the non-physical consequences of his later detention in a mental hospital even though but for the hospital’s failure to detain, Ms Laws would not have been killed.

Prior to the decision of the New South Wales Court of Appeal, there was a strong public reaction to the trial judgment, which had held in

favour of Mr Presland. As a result of widespread media reports expressing public outrage, the New South Wales Parliament amended the Civil Liability Act 2002 (NSW) by inserting s 54A, which bars future claims for recovery of non-economic loss and economic loss (for loss of earnings) in ‘Presland-like’ circumstances. Had the Court of Appeal not reversed the trial judgment, the provision would have had retrospective effect to govern the Presland case, as a result of which he would have been stripped of his damages award. This turn of events, involving media and populist reactions to an unpopular decision, and a consequent legislative response reflecting that outcry, is similar to what occurred in response to the New South Wales Court of Appeal’s decision in Bujdoso v New South Wales (see 3.49) and strongly held views in the community and media as to who is and is not considered a ‘deserving’ plaintiff, worthy of compensation. Presland was applied in a particularly tragic case, Adams by her next friend O’Grady v New South Wales [2008] NSWSC 1257. In Adams, a young woman who had suffered [page 264] years of abuse and had a ‘mental and/or psychotic disorder’ was made a ward of the state at age six. At age 17, after attacking her mother with a knife, she was detained at Yasmar, a youth detention centre. Despite having been described as someone with a preoccupation with sharp objects, she was allowed to enrol in a cooking class, where, after making verbal threats against the staff, she gained access to and used a knife to stab her cooking teacher. He died. She brought a civil claim for her loss of liberty as a result of having a 10-year ‘limiting term’ imposed upon her. She claimed that the state, as the body responsible for Yasmar, failed to take into account her violent history; she argued that it should have ensured that she did not gain access to knives. Her claim before Rothman J of the New South Wales Supreme Court failed, as she could not establish a relevant duty, largely for policy reasons.

As was the case in Presland, causation also proved problematic, having regard to normative considerations.

Remoteness of damage: part of the scope of liability inquiry 4.51 In all jurisdictions except for the Northern Territory, normative questions underlying the ‘scope of liability’ inquiry arise frequently in cases that raise ‘remoteness of damage’ (or ‘harm’) issues. In these types of cases, courts are to articulate the norms driving their decisions, where attribution choices are open, recognising that the results yielded by the ‘foreseeability of the kind of harm’ test (see 4.54) are underpinned by particular values. The ultimate normative consideration involves whether it is appropriate for the scope of the negligent (or ‘faulty’, in Western Australia) person’s liability to extend to the harm: should the defendant be responsible? The court is directed to consider whether or not and why responsibility for the harm should be imposed. In Zanner v Zanner (see 4.2, 4.9, 4.17, 4.35), Allsop P (Young JA concurring) canvassed the effect of the legislative framework (and the Ipp Panel Report’s influence) (at [5]): Whether it did indeed change the common law is not free from doubt. That it propounded a structure conforming more to the approach of McHugh J in March v Stramare than that of Mason CJ would tend to indicate that it did. Further, though s 5D is entitled causation, it appears to encompass all limits on scope of liability, including remoteness …

The statutory provision does not seem to make a great deal of difference to the result in a case, when compared to what would occur at common law. Indeed, courts have always used the existing, vast body of remoteness case law to answer these line-drawing questions. Therefore, the legal position in the Northern Territory is not markedly different to that of the other seven jurisdictions, which have enacted this statutory directive. Furthermore, in terms of methodology, as was noted at the start of our scope of liability discussion, precedent must be used when addressing the normative question within an established class; previous common law cases that are on point cannot simply be discarded (see 4.34).

However, in one respect, there is a distinct difference introduced by most Civil Liability Acts, relevant to remoteness of harm cases but outside the ‘causation’ sections. All jurisdictions except for the Northern Territory and Queensland enacted additional provisions that could yield different results in cases such as Nader [page 265] v Urban Transit Authority of New South Wales (1985) 2 NSWLR 501 (see 4.57) and Kavanagh v Akhtar (1998) 45 NSWLR 588 (see 4.59), involving claims for mental harm which were alleged by the respective defendants to be too ‘remote’. The Civil Liability Acts now address this type of claim under ‘consequential mental harm’ provisions, more fully explored at 4.60 and 9.13. 4.52 The concept of remoteness of damage, which fits within the second limb of this statutory approach to causation, is concerned with the extent of the defendant’s liability for losses caused by her or his negligence. Once it has been established that the defendant was negligent, and once it has been established that the defendant’s negligence caused the injury or damage suffered by the plaintiff, the court asks the further question: should the defendant be required to compensate the plaintiff for her or his injury or damage, or is that injury or damage too remote a consequence of the defendant’s negligence? If the injury or damage is too remote, then the defendant is not required to compensate the plaintiff, even though the injury or damage was caused by the defendant’s negligence.

The discredited ‘direct consequences’ test from Re Polemis: later ‘replaced’ by The Wagon Mound (No 1) 4.53 From 1921 to 1961, the test for remoteness of damage was found in the case of Re Polemis and Furness, Withy & Co Ltd [1921] 3 KB 560. Under the Re Polemis test, the defendant was liable for all the direct consequences of her or his negligence. Thus, if the plaintiff’s

damage or loss was the direct consequence of the defendant’s negligence, it was not too remote for damages to be recoverable. By 1961, however, Re Polemis had become one of the most criticised cases in legal history. It was criticised for imposing too heavy a burden on defendants, by making them pay for all of the direct consequences of their negligence, rather than merely those that were reasonably foreseeable. In an article entitled ‘The Road from Morocco: Polemis through Donoghue to No-fault’,10 I (Martin, one of the authors of this book) tried to show that Re Polemis was an entirely appropriate decision when it was made in 1921. At that time, there was no general test for the existence of a duty of care. Duty of care is considered in Chapter 5; for present purposes, it is sufficient to say that the concept of duty of care defines the range of people to whom the defendant may be held liable in negligence. In 1921, the range of potential plaintiffs for each defendant was relatively small, because there was a restricted test for the existence of a duty of care. Thus, it was not inappropriate to have a remoteness test that provided for extensive potential liability to each potential plaintiff. Consistently with this, Re Polemis was not initially criticised for imposing too heavy a burden on defendants. Criticisms of that kind only began to appear after 1932, when a general test for the existence of a duty of care was laid down in the case of Donoghue v Stevenson [1932] AC 562: see 5.5. The Re Polemis test had the effect that defendants had extensive potential liability to each plaintiff to whom a duty was owed; Donoghue [page 266] v Stevenson expanded the number of potential plaintiffs to which defendants might have that extensive potential liability. The combination of the broad Donoghue test with the extensive Re Polemis test imposed an extensive potential burden on defendants that had not existed before Donoghue. Although it was the combination of tests that

imposed a heavy burden on defendants, the Re Polemis test was solely ‘blamed’ for this result. As a result, it was thought that the problems of remoteness of damage could be solved simply by removing the Re Polemis test, and by replacing it with a test based on reasonable foreseeability. That was finally done in 1961.

The ‘modern’ test: foreseeability of the kind of harm, established by The Wagon Mound (No 1) 4.54 The following case is one of the leading cases in negligence law. It stated that the ‘modern’ test for remoteness of damage is that of reasonable foreseeability of damage. Key Case Overseas Tankship (UK) Ltd v Morts Dock and Engineering Co Ltd (The Wagon Mound (No 1)) [1961] AC 388 Facts: The defendants were the charterers of the ship, the Wagon Mound. While loading fuel oil onto the Wagon Mound at a wharf in Sydney Harbour, the defendants’ employees negligently spilled oil onto the water. The oil drifted across the harbour to the plaintiffs’ wharf. The plaintiffs were shipbuilders and ship repairers, and their employees were doing welding work on the ship Corrimal. When the plaintiffs’ works manager saw the fuel oil on the water, he stopped all welding operations at the plaintiffs’ wharf. He then discussed the situation with the manager of the fuel oil wharf where the Wagon Mound was berthed. The two men came to the conclusion that the oil on the water could not be ignited, as fuel oil floating on water could not reach the flash point temperature. Nevertheless, the fuel oil on the water did catch fire. The fire destroyed the plaintiffs’ wharf, the ship Corrimal and another ship at the wharf, the Audrey D. Issue: Was the destruction of the wharf caused by the negligence of the defendants’ employees? Decision: Although the actual cause of the fire was not established by evidence, the trial judge held as fact that the fire had been caused by molten metal from the welding at the plaintiffs’ wharf falling onto some cotton waste or rag floating on some debris in the water. The molten metal ignited the cotton waste, which ignited the floating debris, which ignited the fuel oil. He applied the Re Polemis test to these facts, and held that the defendants were liable for the destruction of the plaintiffs’ wharf, because their negligence in spilling the oil had been the direct cause of the damage. On appeal, the Privy Council overruled Re Polemis and held that the defendants were not liable, because the loss of the plaintiffs’ wharf by fire was not a reasonably foreseeable

consequence of the defendants’ negligence in spilling the fuel oil. Delivering the opinion of the Privy Council, Viscount Simonds said (at 423): [page 267] [I]f some limitation must be imposed upon the consequences for which the negligent actor is to be held responsible — and all are agreed that some limitation there must be — why should that test (reasonable foreseeability) be rejected which, since he is judged by what the reasonable man ought to foresee, corresponds with the common conscience of mankind, and a test (the ‘direct’ consequence) be substituted which leads to no-where but the never-ending and insoluble problems of causation.

It is important to note that the reasonable foreseeability question at this stage of the negligence inquiry is quite different from that asked with respect to standard of care (see Chapter 3). In this context, the court is concerned with what damage is reasonably foreseeable as a consequence of the defendant’s negligence, not what risks of injury are reasonably foreseeable as a result of the defendant’s activities. Therefore, the remoteness of damage question does not arise until it has been established that the defendant has failed to take reasonable precautions against a reasonably foreseeable risk of injury or damage, and that that negligence caused the injury or damage suffered by the plaintiff. 4.55 Although the question of reasonable foreseeability with respect to remoteness of damage is different from the question of reasonable foreseeability with respect to standard of care, at common law, ‘reasonable foreseeability’ itself means the same thing in both contexts, as the next case shows. Recall the statutory changes in the context of breach (see 3.35). Case Example Overseas Tankship (UK) Ltd v The Miller Steamship Co Pty Ltd (The Wagon Mound (No 2)) [1967] 1 AC 617 Facts: The owners of the ships Corrimal and Audrey D sued the charterer of the ship

Wagon Mound (see 4.54), alleging that the loss of the two ships by fire was caused by the negligence of the defendant in spilling fuel oil onto the harbour. The evidence in these proceedings was very different from the evidence that had been led in The Wagon Mound (No 1). Issue: Was the damage suffered in this case as opposed to that suffered in The Wagon Mound (No 1) reasonably foreseeable? Decision: The Privy Council held it was reasonably foreseeable that the oil on the water might catch fire. Delivering the opinion of the Privy Council, Lord Reid said (at 643): … the only question is whether a reasonable man having the knowledge and experience to be expected of the chief engineer of the ‘Wagon Mound’ would have known that there was a real risk of the oil on the water catching fire in some way: if it did, serious damage to ships or other property was not only foreseeable but very likely … [A] properly qualified and alert chief engineer would have realised there was a real risk here … [A] real risk is one which would occur to the mind of a reasonable man in the position of the defendant’s servant and which he would not brush aside as far-fetched …

[page 268]

The extent of the harm and the precise manner of the harm’s occurrence need not be reasonably foreseeable 4.56 If the injury or damage suffered by the plaintiff was foreseeable as a possible consequence of the defendant’s negligence, then it is not too remote. Further, it is only necessary that the kind of injury or damage suffered by the plaintiff be reasonably foreseeable as a possible consequence of the defendant’s negligence. In England, that proposition was established by the case of Hughes v Lord Advocate [1963] AC 837, where the plaintiff, a young boy, suffered severe burns as a result of the defendant’s negligence in leaving a paraffin lamp unattended. The House of Lords held that the severe burns suffered by the plaintiff were not too remote a consequence of the defendant’s negligence, even though they were not reasonably foreseeable in themselves, as some kind of burns injury was reasonably foreseeable, and it was immaterial that the extent of the plaintiff’s burns injury was greater than was reasonably foreseeable. The House of Lords also held

that, if the harm suffered is of a foreseeable kind, the plaintiff is not prevented from recovering damages simply because the manner in which the harm came about was unforeseeable. The principle that the defendant does not have to foresee the extent of harm was endorsed by the House of Lords in Jolley v Sutton London Borough Council [2000] 3 All ER 409, where the 14-year-old plaintiff and a friend decided to repair and sail a derelict, rotten boat, which had been abandoned on the grounds of council flats. The council had placed a sticker on the boat which read ‘Danger do not touch this vehicle unless you are the owner’. Although the sticker stated that the boat would be taken away within seven days, the council failed to remove the boat. The plaintiff and his friend used a car jack to lift up the front of the boat so that they could repair it from underneath. While the plaintiff was working under the boat, the boat fell on him, leaving him a paraplegic. The House of Lords applied Hughes, holding that this type of accident and kind of injury were reasonably foreseeable and that liability for the wider risk had to be borne by the council. The next case is the Australian authority for the proposition declared by the House of Lords in Hughes. Key Case Mount Isa Mines Ltd v Pusey (1971) 125 CLR 383; [1971] ALR 253 Facts: Two of the defendant’s employees suffered severe burns when they were electrocuted while working on a switchboard in the defendant’s powerhouse. It was later found that the defendant had negligently failed to give the men proper instructions about their duties. The plaintiff, also employed by the defendant, went to the scene of the accident and saw one of the badly burned men. He carried the man to an ambulance. Nine days later, the plaintiff found out that the [page 269] man had died. About four weeks later, the plaintiff developed acute schizophrenia. He sued his employer, alleging that his schizophrenia had been caused by its negligence. Issue: Was schizophrenia a reasonably foreseeable consequence of the defendant’s

negligence? Decision: The High Court of Australia held unanimously that the plaintiff’s schizophrenia was not too remote a consequence of the defendant’s negligence, and that mental disturbance of some kind was a reasonably foreseeable consequence. It was immaterial that the extent of the mental disturbance was not reasonably foreseeable. Windeyer J said (at CLR 402; ALR 264): Foreseeability does not mean foresight of the particular course of events causing the harm. Nor does it suppose foresight of the particular harm which occurred, but only of some harm of a like kind. That is well established by many cases, including Chapman v Hearse and Hughes v Lord Advocate. This comfortable latitudinarian doctrine has, however, the obvious difficulty that it leaves the criterion for classification of kinds or types of harm undefined and at large.

In addition to considering new intervening acts issues, Gittani Stone Pty Ltd v Pavkovic (see 4.48) employed the approach used in Hughes. The precise manner in which the injury came about did not have to be foreseeable, as long as it was within the kind of harm which was reasonably foreseeable. Because there had been a series of violent incidents together with the totality of Lee’s abusive conduct, the shooting was not too remote. In a case decided more recently, in a context that is far too common, the appellant in Eaton v TriCare (Country) Pty Ltd [2016] QCA 139, who worked in an administrative position at one of the respondent’s nursing homes, developed a psychiatric illness which she claimed was the result of a consistently excessive workload and bullying by her manager, another employee. This case was decided without reference to Queensland’s civil liability legislation. Having found a duty of care, reversing the trial judge on this point, Philip McMurdo JA (Fraser JA and Boddice J agreeing) of the Queensland Court of Appeal stated (at [59]) that even though the appellant’s heavy workload did not of itself constitute a breach, ‘her excessive workload … contributed to the stress of which the essential cause was [her manager’s] conduct’. With respect to causation, the court noted the difficulties associated with delineating the ‘negligent’ and ‘non-negligent’ precursors to a mental disorder, particularly when expert opinion differs. Philip McMurdo JA noted (at [69]):

In [one expert’s] … ultimate opinion, the appellant’s pre-existing anxiety disorder was exacerbated by work stressors … such that the appellant suffered an anxiety disorder and a depressive disorder. Dr Byth’s diagnosis was that the appellant had developed major depression with prominent anxiety and depression along with posttraumatic stress disorder, all as a result of her work during [the period during which she was bullied].

[page 270] Case Example State Rail Authority of New South Wales v Yu-Mei Chu (2008) Aust Torts Reports ¶81-940 Facts: A 36-year-old television news reporter from Taiwan, who had been studying English in Australia for a few months, fell after losing her footing on slippery stairs at a Sydney railway station. Because she broke her ankle, her leg was in plaster. Several weeks later, she was invited to the home of a man who had been assisting her while she was incapacitated. He sexually assaulted and beat her; she suffered psychiatric consequences. The plaintiff argued that because of her broken ankle and partial immobilisation necessitating the use of crutches, she was not able to escape the assailant. Issues: Was the harm she suffered (beyond the broken ankle) too remote a consequence of the defendant’s carelessness? Also, was the slippery stairwell a necessary condition of her harm and was the assailant’s battery a new intervening act? Decision: At trial, Goldring DCJ held that the rail authority was in breach of its duty for having a slippery, ‘hazardous’ stairwell under its control. Applying the Civil Liability Act 2002 (NSW) s 5D, he held (at [40]) that the ‘necessary element’ of the inquiry was readily satisfied on a balance of probabilities, as her reduced mobility made her vulnerable to a sexual predator, hindering her capacity to escape. This led to the psychological injury stemming from the sexual assault. On appeal, the liability finding with respect to the assault and ensuing harm was reversed by Matthew AJA (Hodgson and Bell JJA concurring). In their view, factual causation was not satisfied: the assault probably would have occurred whether or not she had been injured in the fall, because her immobility was not as significant as other factors, such as the assailant’s parents’ presence downstairs in the home and the fact he had stolen her wallet and phone and she did not want to leave without them. The court also held that the assault was a new intervening (criminal) act of a third party — a ‘free, deliberate and informed act’ — which broke the causal chain. Finally, with respect to remoteness of harm, the court stated (at [58]) ‘it was not reasonably foreseeable that a young woman who was immobilised to the extent of having to use crutches would thereby be exposed to a criminal sexual assault’. Ultimately, despite losing on these points, the damages assessed with respect to the initial accident and

her future economic loss was increased; her total damages award ended up only 10 per cent less than that assessed at trial.

In Langmaid v Dobsons Vegetable Machinery Pty Ltd (2014) 24 Tas R 18; [2014] Aust Torts Reports ¶82-177; [2014] TASFC 6, which considered inferences and proof (see 4.13), Porter J (Pearce J agreeing) stated (at [140]): Lack of evidence about the precise mechanism of how injury or damage came to be suffered does not necessarily prevent the inference being drawn about the causal link. … [A] plaintiff does not have to establish that the precise sequence of events leading to the particular damage was foreseeable. It is sufficient if the general kind or type of

[page 271] injury is reasonably foreseeable: [Chapman v Hearse at 121; Rosenberg v Percival per Gummow J at [64]; Metrolink Victoria Pty Ltd v Inglis per Neave JA at [12]].

The following tragic case considered several issues relevant to causation. Notwithstanding the fact that the case was decided under common law principles because the alleged negligence pre-dated the enactment of the Civil Liability Act 2002 (NSW), the court’s reasoning used language and logic not unlike that included in the statute. Beazley P observed (at [174]), ‘[a]lthough in Wallace v Kam causation was governed by the Civil Liability Act 2002 (NSW), s 5D, the evaluative considerations involved at common law do not differ in substance’. Her Honour highlighted (at [175]) causation’s concern with ‘allocating legal responsibility’, having considered Mason CJ’s comments to this effect in March v E & MH Stramare. Case Example Waller v James (2015) 90 NSWLR 634; [2015] NSWCA 232 Facts: see 3.18. Issues: Was the child’s, Keeden’s, disorder the factual cause of his stroke? Was the claimed economic loss harm that was too remote? Breach issues are noted at 3.18.

Decision: The Wallers contended that if Dr James had properly informed them about the genetic condition they would have deferred IVF until measures were available to avoid having a child with anti-thrombin deficiency (ATD) disorder, which confers a predisposition to thrombosis which they alleged caused the extensive cerebral sinovenous thrombosis (CSVT), a type of stroke. The primary judge concluded that the Wallers had failed to establish that Keeden’s hereditary ATD disorder was the factual cause of Keeden’s stroke because, according to one expert (cited by Beazley P at [52]), ‘there are probably multiple events that, combined, lead to a thrombosis, and some of them we will know about and some we won’t know about ’. This finding was not challenged on appeal. The question of whether Dr James’ negligence resulted in a pregnancy that would not otherwise have occurred and was thus a cause of the claimed economic loss was a live issue on appeal. Beazley P (with whom McColl and Ward JJA agreed) held that the ‘but for’ test was satisfied. However, the court held (at [185]) that scope of liability considerations required identifying ‘the policy underlying the respondent’s duty to cause the appellants to be informed of the inheritability of ATD’. Distinguishing the case from Cattanach v Melchior, the court noted (at [186]) that the appellants consulted the respondent to facilitate rather than prevent pregnancy and their objectives did not include avoiding the ‘legal and moral responsibilities’ that arise from childbirth. Beazley P stated (at [188]) that the question of causation could be resolved as follows: … by positing the circumstance that the appellants were involved in a blameless accident on the way home from hospital with the same catastrophic consequences as occurred here, or that Keeden contracted some other disease such as rheumatic fever or polio, or had an aneurism unrelated to ATD. Some such event could occur almost immediately after birth or it may not occur until some later point in time. It would not be appropriate for the respondent’s liability to extend to all the harm suffered by the [page 272] parents as a consequence of Keeden’s birth, in circumstances where the appellants were willing to hazard the general risks of a pregnancy induced by IVF treatment. Such general risks included the miniscule risk of CSVT, which in fact materialised. This is the result notwithstanding that the appellants would not have undergone IVF treatment had they been informed of the risk of ATD. The CSVT was coincidental, for legal purposes, to the inheritance of ATD. Beazley P also considered the question of remoteness of harm (at [202]), affirming the principle that, ‘whilst liability is imposed for all the foreseeable consequences of negligence, a defendant will only be liable where the harm suffered is within the risk created by the negligence’, citing Roe v Minister of Health [1954] 2 QB 66 at 85 and Hughes v the Lord Advocate [1963] AC 837 at 858. Her Honour concluded (at [204], [208]): [The catastrophic stroke] was unrelated to Keeden’s inherited ATD and was

unrelated to any information with which the appellants would have been provided had they received genetic counselling. Even if the appellants’ losses flowing from this event are the relevant harm in this case, I agree with the primary judge that that harm was not foreseeable so as to come within the scope of the risk created by the respondent’s negligence. … [T]he damage sustained by the appellants was too remote such that the respondent ought not to be liable for it. Except for the risk of having a child with ATD, the appellants were willing to undertake the risks of pregnancy, including the risks that a child they might have may be born with abnormalities. … The cause of [the child’s] CSVT was multifactorial, but was not associated with ATD. … The risk of a child with ATD also suffering a CSVT was miniscule, as was the risk of a child without ATD suffering a CSVT. McColl JA similarly noted (at [226]) that the harm suffered by the appellants, ‘in the literal sense, was bearing a child who was disabled catastrophically by an extremely rare medical event: CVST, being a risk of birth they had agreed to accept’. Her Honour stated (at [227]): The appellants were … in a similar position to the plaintiff in Wallace in that they sought to render the respondent liable for an injury they were prepared to accept, but would have avoided had they been properly warned about a different, and unrelated or distinct, risk. The harm for which they seek to recover is not the harm consequent upon not being warned about the risk of ATD, save in the most general sense of bearing Keeden. Rather, the harm for which they seek to recover is damages arising from the pain and suffering they have suffered through bearing a child who suffered catastrophic injuries after his birth by reason of a risk of abnormality inherent in bearing children of which they were warned and were prepared to accept. McColl and Ward JJA were critical of the appellants for reframing the relevant harm as the loss of an opportunity to plan their family. McColl JA stated (at [233]): The appellants cannot escape [the negative conclusion] … by pitching their case at the high level of generality that the relevant harm is damage to their right to plan their family. In the final analysis, even accepting that characterisation, the normative question of causation had to be determined. It was properly determined adversely to the appellants by the primary judge. Ward JA observed (at [249]): Acceptance of the appellants’ argument in this case would make a person in the respondent’s position effectively the insurer of any pregnancy resulting from the IVF procedure undertaken at a time when the parents were not fully informed of a particular [page 273]

genetic risk that they were not prepared to run, whether or not the baby resulting from that procedure had inherited the relevant gene, because on that hypothesis the couple’s right to plan their family was infringed or harmed by the provision of insufficient information. The suggestion that the respondent might be liable for the whole of the costs of child-raising because the parents had undertaken a procedure that they would not otherwise have done at that particular time, is not one that readily commends itself. An application for special leave to appeal to the High Court was denied (S182/2015).

Characterising the kind of harm 4.57 Mount Isa Mines Ltd v Pusey shows that the answer to the remoteness of damage question depends on the classification of ‘kinds’ of damage adopted by the court. In other words, the answer to the question of whether two things are of the same kind depends on what one means by ‘the same kind’. For example, consider whether an apple and orange are things ‘of the same kind’. If one considers this question only in the context of types of fruit, the answer is ‘No’, an apple and an orange are not the same kind of thing. However, if one considers the question in the context of all kinds of tangible objects, from shoelaces to fried potatoes and from yachts to Hawaiian shirts to Bermuda shorts, the answer seems to be ‘Yes’, an apple and an orange are the same kind of thing, because they are both kinds of fruit. Because of this ‘comfortable latitudinarian doctrine’, it is possible to justify almost any outcome, as the contrast between the next two cases should show. (It should be stressed that these two cases are extreme examples at either end of the spectrum of what is possible. Most cases fall somewhere in the middle of that spectrum.) Case Example Tremain v Pike [1969] 3 All ER 1303 Facts: The plaintiff contracted a very rare disease known as ‘Weil’s disease’ through contact with rats’ urine at the defendant’s farm, where he worked as a herdsman. He sued his employer, alleging that his Weil’s disease had been caused by the negligence of the defendant in failing to prevent the infestation of the farm by rats.

Issue: If the employer (defendant) had been careless, was Weil’s disease a reasonably foreseeable consequence of that negligence? Decision: Payne J first held that the defendant had not been negligent in the circumstances. However, he went on to state that this harm was too remote. He said (at 1308): The kind of damage suffered here was a disease contracted by contact with rats’ urine. This … was entirely different in kind from the effect of a rat bite, or food poisoning by the consumption of food or drink contaminated by rats. I do not accept that all illness or infection arising from an infestation of rats should be regarded as of the same kind.

[page 274] Key Case Nader v Urban Transit Authority of New South Wales (1985) 2 NSWLR 501 Facts: The plaintiff, a 10-year-old boy, suffered superficial head injuries as a result of a fall when alighting from a moving school bus. Shortly after the accident, he developed symptoms of a very rare psychiatric disorder known as ‘Ganser syndrome’. Some of the symptoms of the plaintiff’s Ganser syndrome had an organic basis, but the condition and its continuation were partly a reaction to the over-protectiveness of the boy’s parents and partly due to the parents’ failure to obtain appropriate treatment. Issue: Was the child’s Ganser syndrome too remote a consequence of the driver’s negligence in opening the bus door before the bus had come to a halt? Decision: By a majority of two to one, the Court of Appeal of New South Wales held that it was not too remote. McHugh JA said (at 536): [T]he Ganser Syndrome … was damage of a kind which a reasonable man should have foreseen. Although the condition is rare, it is a recognized psychiatric illness … Moreover, if it is correct … that the defendant is only liable for a mental illness which was caused in a way which could generally [have] been foreseen, the defendant is still liable. … [I]t was certainly foreseeable that an accident to a ten year old boy would bring about a reaction from his parents. If the plaintiff’s condition is attributable either in whole or in part to the attitude of the parents, I think that it is one of the consequences of the defendant’s negligence which was within its reasonable foresight.

If the damage suffered by the plaintiff is of an unforeseeable kind, it is too remote to be recoverable, even if it arose out of damage of a foreseeable kind. Case Example Commonwealth v McLean (1996) 41 NSWLR 389 Facts: The plaintiff suffered post-traumatic stress disorder after being on HMAS Melbourne when it collided with and sank HMAS Voyager. The post-traumatic stress disorder later caused the plaintiff to drink alcohol and smoke tobacco excessively, which in turn caused throat cancer. Issue: Was this further damage too remote a consequence of the collision? Decision: The Court of Appeal of New South Wales held that it was not enough that the further damage suffered by the plaintiff had been caused by the foreseeable posttraumatic stress disorder. The further damage was too remote unless it was the same kind of damage as the foreseeable stress disorder. Because that question had not been asked of the jury at first instance, a retrial of that question was ordered. Handley and Beazley JJA said (at 407): The plaintiff was only entitled to recover for the further damage if the jury found either that it was damage of the same kind as the foreseeable stress disorder, or if they found that it was reasonably foreseeable.

[page 275] Issues associated with classifying kinds of harm have arisen in interesting contexts beyond personal injury and mental harm. The following case considers unique circumstances, involving economic loss. Case Example Metrolink Victoria Pty Ltd v Inglis (2009) 25 VR 633; Aust Torts Reports ¶82-032; [2009] VSCA 227 Facts: The respondent, a driver, collided with a tram operated by the appellant. This resulted in delay to a number of trams which the appellant operated. The driver admitted

negligence, agreeing to pay for the tram’s repair. However, because of the service delays, the appellant also claimed damages for the operational performance penalties it had to pay to the state government under its franchise agreement. Issue: Are contractual penalties a foreseeable kind of harm or are they too remote from the negligence that caused the collision? Decision: The magistrate’s decision, upheld by the Supreme Court of Victoria, restricted the plaintiff’s recovery to the repair of the tram, holding that the imposition of a financial penalty by a third party was too remote, as it was not reasonably foreseeable damage. Metrolink successfully appealed the decision to the Court of Appeal. Redlich JA (and Williams AJA) held that categorising damage is a question of law. The majority then decided that the lower courts had taken too narrow a view of the categorisation, as the particular or precise character of damage did not have to be foreseen to be recoverable. Noting that ultimately, the appropriate categorisation is a policy question, the majority held that there was nothing that unusual about the plaintiff’s remuneration arrangements, including the imposition of penalties if there was an interruption to the tram service. The majority concluded that the loss of revenue from the inability to operate the tram service ‘should have been reasonably foreseeable to someone in the position of [the defendant]’. Neave JA, dissenting, observed (at [10], [22]–[23]): There are no settled legal criteria for categorising the kind or genus of a loss suffered by a plaintiff. The breadth or narrowness of the categorisation may determine whether the damages suffered by the plaintiff are held to be reasonably foreseeable. … [T]he categorisation of the type of harm suffered by the plaintiff, is ultimately a question of policy. This is because the concept of remoteness of damage (like the anterior duty of care question) is used to define the outer limits of the liability of a negligent defendant. … [T]he categorisation of the genus of loss suffered by Metrolink as a loss of business income or a loss of revenue is too broad because it would mean that any loss arising as the result of disruption of a contract made with a third parties [sic] was potentially compensable. A loss suffered as the result of failure to meet performance targets under a contract with the State government is a loss of a different character to the loss of fares caused by a tram becoming inoperative because it is damaged. This approach … recognises that a loss caused by the operation of a contract with a third party which covers the operation of the whole tram network is a loss of quite a different kind from loss of fares or the cost of repairing the tram. Neave JA also likened this case to one involving purely economic loss (see Chapter 8), expressing concern that damage arising from any resultant breach of contract would be compensable.

[page 276]

4.58 With respect to the classification of ‘kinds of harm’, the cases considered above show a range of arguments that can be made with respect to the remoteness test derived from The Wagon Mound (No 1) and Pusey’s case. Both a very broad and a very narrow result can be justified using the same legal principles. The outcome of a case depends on the degree of specificity (or level of abstraction) used with which the court asks the question. Precedent seems to be of limited assistance in determining the correct approach to take in any particular case. In Rowe v McCartney [1976] 2 NSWLR 72, Samuels JA considered past decisions in detail before concluding (at 89): I may say that such of these sources as I have examined give me no substantial help. I think that all one can do, in seeking to decide whether a particular harm is of a kind that was foreseeable, is to endeavour to draw a line between the broadest of categories, on the one hand, which would reintroduce liability for direct consequences, and the narrowest, on the other, which would promote uncertainty and provide distinctions of a disreputable nicety. And, in doing so, it is necessary to remember that the purpose is to set a limit to the consequences for which a negligent defendant ought to pay.

In other words, to quote from an examination answer written by a student of the great torts lawyer A L Goodhart: ‘In this case a line cannot be drawn anywhere, therefore it must be drawn somewhere.’11 This is also clear and rather disconcerting when one considers a more recent case like Metrolink, where equally convincing and thoughtful sets of reasons, using essentially the same authorities, yield opposite results. The majority acknowledged the difficulties of categorisation, citing Samuels JA’s comments in Rowe. The majority also stated (at [95]): It is not always easy to discern the basis upon which the breadth of the relevant category is determined in the individual case. It does appear, however, that in the ordinary case a broad categorisation of the kind or genus of the loss will be appropriate. … The adoption of a broad categorisation is consistent with the principle that it should not be necessary that the exact course of events which produced the injury was predictable or likely so long as the injury was foreseeable.

In Uniting Church in Australia Property Trust (NSW) v Miller; Miller v Lithgow City Council (2015) 91 NSWLR 752; 212 LGERA 230; [2015]

NSWCA 320 (see 4.9), Leeming JA (Basten and Simpson JJA agreeing) observed (at [110]): [A] plaintiff may be exposed to a range of risks, and a range of harms. The common law has long applied what Windeyer J once described as the ‘comfortable latitudinarian doctrine’ that it is sufficient that harm of the kind suffered by the plaintiff has been foreseeable: Mount Isa Mines Ltd v Pusey (1970) 125 CLR 383 at 402. That left unresolved the level of abstraction or particularity with which the harm was to be defined, as Allsop P observed in Stephens v Giovenco [2012] Aust Torts Reports ¶82-109; [2011] NSWCA 53 at [5]. That remains the position in cases to which the Act applies. Plainly enough, the class of harm in the present case includes all injuries — minor, major, catastrophic or even fatal — suffered from a dive which results in the swimmer colliding with the bottom of the pool.

[page 277] The court concluded (at [118]) that the statutory text of the Civil Liability Act 2002 (NSW) provides little guidance in identifying the appropriate level of abstraction in a given case, concluding that ‘the risk is not to be confined to the precise set of circumstances which are alleged to have occurred, although it must encompass those circumstances’. Leeming JA also noted (at [119]) that ‘[i]t is unrealistic to expect there to be a single canonically “right” characterisation of the risk of harm’, as evidenced by the fact that ‘trial judges and appellate courts reaching the same result have, on occasion, formulated the risk differently’. Leeming JA cited with approval (at [120]) the observation made in Perisher Blue Pty Ltd v Nair-Smith (2015) 90 NSWLR 1; [2015] NSWCA 90 that ‘[g]enerally, it is as unnecessary as it is undesirable to define the relevant risk with … [a high] level of particularity’; the court in Perisher had stated that the reason a high degree of particularity was warranted in that case was because ‘several risks attend the process of boarding a chairlift and unless the relevant risk is identified with sufficient precision one cannot determine what, if any, reasonable precautions ought to have been taken in order to avert it’.

‘Egg shell skull’: you take your victim as you find her or him

4.59 One of the ways in which the plaintiff can sometimes escape the harshness of The Wagon Mound (No 1) (see 4.54) is by use of the ‘egg shell skull’ principle, commonly referred to as ‘taking your victim as you find her or him’. In Nader (see 4.57), McHugh J held that this was an alternative basis on which the plaintiff could recover for his Ganser syndrome. He applied the egg shell skull principle to the young boy’s psychological and familial circumstances. This principle is sometimes rationalised as going to the extent of harm, which need not be foreseen, thus surviving Wagon Mound (No 1). The breadth of this principle is expressed by McHugh J in Nader v Urban Transit Authority of New South Wales (at 536–7), as follows: The rule of the ‘egg shell skull cases’ should not be confined to the physical and constitutional characteristics of the particular individual. When a defendant takes a plaintiff as he finds him, he does not take him as a naked human being divorced from his environment … I think that the defendant must take the plaintiff with all his weaknesses, beliefs and reactions as well as his capacities and attributes, physical, social and economic.

The New South Wales Court of Appeal applied the egg shell skull principle in the following case. Case Example Kavanagh v Akhtar (1998) 45 NSWLR 588 Facts: A woman of Indian Muslim descent, born in Fiji but residing in Australia, was injured when a heavy box of perfume fell on her while shopping at the defendant’s store. The box had been carelessly passed between the store’s employees. She [page 278] suffered an injury to her shoulder area, face (as she fell) and jaw. Her permanent injuries caused her pain and discomfort. She had very long hair, which was of cultural and religious significance to her. As a result of her physical injuries, she was unable to care for her hair. She cut her hair, without her husband’s permission. He viewed her act as a betrayal of their religion, which arguably required the husband’s consent. It should be noted that the laws of Islam allow women to cut their hair when it is necessary to do so for medically-related reasons. Her husband became abusive. He eventually left the family home. She, in turn, suffered depression and developed suicidal tendencies. The

couple separated. In her negligence action against the store, she claimed damages for her psychiatric injury. Issue: Was the harm she suffered, beyond her physical injuries, too remote? Decision: Holding in her favour, Mason P of the New South Wales Court of Appeal (with whom Priestley and Handley JJA agreed) stated (at 601–2): The principle that a tortfeasor takes the victim as he or she is found is not absolute and unqualified. However, I see no reason why the appellant should not take the respondent in the family and cultural setting that she lived … Equality before the law puts a heavy onus on the person who would argue that the ‘unusual’ reaction of an injured plaintiff should be disregarded because a minority religious or cultural situation may not have been foreseeable … [T]he law should, in this area, take ‘human nature as it is, with its infirmities, and having regard to the relationship of the parties concerned’: per Lord Wensleydale in Lynch v Knight (1861) 9 HLC 577 at 600; 11 ER 854 at 863.

The broad use of the egg shell skull doctrine in conjunction with issues associated with classifying kinds of harm further complicates matters. Some would suggest that cases like Kavanagh stretch beyond recognition what was originally a pro-defendant, limiting test from The Wagon Mound (No 1). While Kavanagh may be an appropriate and desirable result, it is difficult to reconcile with The Wagon Mound (No 1) — especially having regard to the rationale underlying that decision. In cases like Kavanagh, the lip service paid to The Wagon Mound (No 1) adds confusion to the reasoning rather than clarification, producing rather uncertain outcomes.

Additional statutory intervention 4.60 The second limb of the causation inquiry in the Civil Liability Acts is particularly important in cases of this nature, where courts, assessing the scope of liability, are expected to consider whether or not and why responsibility for the harm should be imposed on the negligent party. The requirement to use policy will not necessarily yield inevitable results because, with contentious cases, it is likely that there will be differences of opinion with respect to values and norms, as result of which the outcomes will not always be predictable. In addition, all jurisdictions except for the Northern Territory and

Queensland have enacted provisions in their Civil Liability Acts addressing cases of ‘consequential mental harm’. In Victoria, for example, where mental harm is consequential [page 279] on personal injury of some other kind, the plaintiff is not entitled to recover damages unless the defendant ‘foresaw or ought to have foreseen that a person of normal fortitude might, in the circumstances of the case, suffer a recognised psychiatric illness if reasonable care were not taken’ (see 9.13).12 Other jurisdictions use the duty concept with a similar effect, denying that a duty is owed unless the defendant ought to have foreseen that a person of normal fortitude might, in the circumstances of the case, suffer a recognised psychiatric illness if reasonable care were not taken.13 Further, when considering whether a person of normal fortitude would suffer a recognised psychiatric illness in cases of ‘consequential mental harm’, the courts must consider ‘the nature of the bodily injury out of which the mental harm arose’ (see 9.13).14 Because of both the normal fortitude requirement and the fact that a plaintiff might suffer dramatic psychiatric consequences as a result of a relatively minor physical injury, the court may conclude that the defendant owed no duty in relation to the consequential mental harm. It is arguable that the claims for mental harm in cases like Nader v Urban Transit Authority of New South Wales (see 4.57) and Kavanagh v Akhtar (see 4.59) might not succeed under these statutory provisions, despite assertions that — for normative reasons under the causation limbs — public policy could be said to dictate that it would be appropriate for the scope of the defendant’s liability to extend to the harm so caused. Furthermore, in the Australian Capital Territory, New South Wales, Tasmania, Victoria and Western Australia, the court cannot award damages for economic loss for consequential mental harm unless the harm consists of a recognised psychiatric illness (see 9.14).15

The application of the consequential mental harm provision was among several issues considered by the Supreme Court of South Australia, Full Court in Anwar v Mondello Farms Pty Ltd (2015) 123 SASR 321; 253 IR 70; Aust Torts Reports ¶82-235; [2015] SASCFC 109, where the plaintiff, a refugee, injured his hand when it got trapped in a potato packing plant’s conveyor belt. The plant was operated by the respondent. He required a skin graft to treat his burned hand, subsequently developed symptoms of stress and anxiety and was later diagnosed with schizophrenia. The trial judge found that a causal link existed between the hand injury and development of schizophrenia. However, his Honour held that the recoverable damages were limited to those related to the hand injury, because the respondent did not owe a relevant duty of care with respect to his mental harm, pursuant to s 33 of the Civil Liability Act 1936 (SA). His Honour then calculated the [page 280] (hypothetical) quantum of damages that would be available in case he had erred on the duty question, applying a substantial discount on the basis that the appellant would have developed the psychiatric illness at some future stage. The plaintiff appealed the interpretation of s 33 and the (hypothetical) discount; the respondent cross-appealed, contending that the accident did not cause the development of schizophrenia, alleging that he had been experiencing symptoms of schizophrenia before the accident. With respect to the statutory test, Stanley J (Kourakis CJ and Gray J agreeing) stated (at [107]): [T]he question to be answered is not whether the appellant was a person of normal fortitude but whether a reasonable person in the defendant’s position would have foreseen that a person of normal fortitude in the plaintiff’s position might, in the circumstances of the case, suffer a psychiatric illness. Again, the question posed by the statutory test is not concerned with whether the reasonable person in the defendant’s position would have foreseen the risk of suffering schizophrenia in the circumstances of the case, but rather any psychiatric illness. I accept that a reasonable person in the respondent’s position would not have foreseen that a person of normal fortitude in the appellant’s position might, in the circumstances of the case,

suffer schizophrenia. But that is irrelevant. The question is the foreseeability of suffering any psychiatric illness. The risk of such well-recognised psychiatric conditions as anxiety and depression being suffered as a result of relatively commonplace physical injuries sustained in traumatic circumstances is well understood in the community.

The court held (at [108]): [T]he respondent did owe a duty to the appellant to take care not mental harm. … The appellant is entitled to an award of damages on the respondent is liable to him for the losses he suffered, suffers and reason of schizophrenia and the resulting Type II diabetes [a antipsychotic medication].

to cause him the basis that will suffer by side-effect of

See 9.13 for further consideration of this case. In the course of its reasoning the court considered King v Philcox (2015) 255 CLR 304; 320 ALR 398; [2015] HCA 19 (see 9.10).

Recall 4.61 Out of an abundance of caution (and at the risk of overkill), we close this part of the chapter with one more reminder: when discussing principles involving new intervening acts and remoteness of harm in all jurisdictions except the Northern Territory, the inquiry must begin by reference to the particular jurisdiction’s relevant Civil Liability Act and a consideration of the ‘scope of liability’ section. The doctrine associated with new intervening act scenarios and remoteness of harm principles should be viewed as bases upon which one can advocate normative, policy considerations — whether or not and why responsibility for the harm should be imposed on the negligent (or faulty, in Western Australia) party. [page 281]

Problem 1 4.62 Poppy was a very happy, chatty, bright, active six-year-old who had attended Daisy Bay Day Care (a privately owned and managed creche) every weekday for four years. Every year, the day care organised the week-long ‘February Fun Fair Fundraiser’ on the riverfront, bordering popular Daisy Bay Casino. It managed the whole event,

including the competition booths, food stalls, entertainment and cleaning. Cleaning was provided by teenage volunteers (and day care alumni), who were asked to roam around the venue and waterfront cleaning up messes. Poppy delighted in attending the fun fair with her carers and friends from the day care. The day before Poppy’s group’s planned visit to the Fair, Poppy’s primary day care carer, Dana, told the group of 20 six-year-olds that they would still be going on their excursion to the Fair even though Dalit, the other care provider, had fallen ill. Luckily, Poppy’s 15-year-old sister, Dee, agreed to help out. Dee was not a licensed carer, but she was by all accounts an excellent babysitter. Dana and Dee told the kids that when they go to the Fun Fair they must always stay with the group and not wander off on their own. Indeed, they were told that they must do whatever Dana and Dee instructed them to do. Poppy was specifically given extra direction to follow their instructions. The next day, at the fun fair, Poppy (armed with fairy floss in one hand and fudge in the other) and her best friend Pippa excitedly ran ahead of the group, descending upon the booths with brilliantly coloured balloons to be burst and clowns to be tormented. Dee hollered out to the two children, who were now 50 metres away, ‘Slow down — we told you to not run ahead’. Having finished her fudge, Poppy spied the remains of some licorice on the ground, which she was about to pick up. Her unrelenting desire for all things sweet (which almost seemed like an addiction to sugar) was well known to her carers. Indeed, at the fun fair, it kicked into high gear. Seeing what Poppy was about to do, Dee called out, again from a distance, ‘For goodness sake, Poppy, leave that dirty, smelly lolly alone! Please try to control yourself for once, you brat! Resist! You know you’re going to have to be punished, yet again, if you pick up that rubbish!’. Valiantly fighting the urge, Poppy left the licorice on the ground; but, ignoring Dee’s plea to stop running ahead, Poppy and Pippa took off, further ahead of the others, along the riverfront. This time, Dee called out, ‘Darn it, you two, stop running ahead! This place can be dangerous!’. Earlier that morning, Dee had heard a radio report about recent assaults near the casino. Pippa stopped running, and waited for the group. Poppy ignored her sister’s plea and continued running ahead. She dropped her fairy floss. As she was about to retrieve it, Poppy cried out in pain: ‘ooohh — that hurts!’ Poppy had pricked her finger on a used shiny syringe she happened to pick up, which was on the ground beside her dropped fairy floss. A few weeks prior to the fun fair, the Daisy Bay Despatcher had reported that police were concerned that used syringes had been found on the riverfront, near the casino. Polly was taken to see Dr Dire. After some testing, she was diagnosed with HIV and prescribed medication to control her viral load. A few months later, when she [page 282] saw Dr Dire for more treatment, Poppy proclaimed: ‘I wish they had told me not to pick up such sharp objects. They hurt so much! I never would have touched it!’ She also complained about the pills he had given her, as they made her gain weight and feel sad. Tired of Poppy’s incessant complaining, and just plain tired, Dr Dire gave her a relatively

untested new pill to control her weight. It resulted in Poppy suffering permanent, painful femoral nerve damage. Because of Poppy’s overall condition, Poppy’s family became ashamed of her. Poppy now suffers clinical depression. Poppy sues Daisy Bay Day Care for her HIV, nerve damage and depression, arguing that her harm was caused by the day care’s negligence in failing to provide sufficient supervision, failure to properly warn her about the risks of a needle-stick injury and failure to properly manage the February Fun Fair Fundraiser. Advise Poppy and Daisy Bay Day Care with respect to the causation arguments they could make.

Discussion Arguments for Poppy 4.63 The way in which this claim must be approached in all jurisdictions except the Northern Territory is in accordance with the Civil Liability Acts. As the High Court held in Wallace v Kam and Adeels Palace v Moubarak, the essential framework to be followed is that Poppy must first establish ‘factual causation’, by proving that Daisy Bay Day Care’s negligence was a ‘necessary condition of the occurrence of the harm’. If she successfully satisfies factual causation, Poppy must then demonstrate that the scope of Daisy Bay Day Care’s liability extends to cover her harm. Interestingly, albeit parenthetically, in Paul v Cooke, Leeming JA expressed reservations about a strict delineation between factual causation and scope of liability, as did Basten JA in King v Western Sydney Local Health Network. It appears that there is little difference with respect to using the first limb — ‘necessary condition’ — and the common law approach. Therefore, the outcome in the Northern Territory would likely be the same as in other jurisdictions. This view of the legislation is endorsed by Ipp JA in Ruddock v Taylor and Simpson J in Cox v New South Wales. Therefore, with respect to most arguments, it does not appear to matter where Daisy Bay Day Care is located. However, location will be relevant to Poppy’s depression, discussed below. Poppy would argue on the basis of three separate breaches (assuming they are satisfied): but for Daisy Bay Day Care not providing sufficient supervision or staffing, not providing and enforcing warnings about the harm that can be caused by rubbish (including sharp objects), and not properly managing the Fun Fair venue by properly cleaning it, Poppy would not, on a balance of probabilities (Tabet v Gett; Adeels Palace; Strong v Woolworths Ltd), have contracted HIV, nerve damage and depression. There is no reason to suspect that Poppy would have been injured if the defendant had not been negligent. However, it is acknowledged that the ‘but for’ test [page 283] does not determine causation conclusively; she will need to later go on to consider scope of liability, normative (Wallace) issues.

In Chappel v Hart, Gummow J stated that answers to causation questions differ according to the purposes for which the questions are asked. Here, Daisy Bay Day Care has a duty to reasonably protect the young children in its care from exposure to unreasonable safety risks, especially at a venue over which it has (temporary) control and management responsibilities. Poppy’s case involves the attribution of legal responsibility in the tort of negligence, for which damages may be forthcoming. Here, the ‘necessary condition’ requirement (Adeels Palace) is satisfied. It will yield the same conclusions reached by using the ‘but for’ test. Every application of the ‘but for’ test or ‘necessary condition’ requirement involves an evaluation of what probably would have happened if the defendant had not been negligent and a comparison of that situation with what actually happened. Poppy would concede that under the Civil Liability Acts as well as at common law, she bears the burden of proving, on a balance of probabilities, any fact relevant to the issue of causation; the need to do so is highlighted in Tabet v Gett (albeit in a vastly different context) and Al Mousawy v Howett-Stevens Construction Pty Ltd which may be cited by way of example, even if, on the facts, the claims may have failed. Here, there is direct evidence of how Poppy was injured. A central issue is how likely it is that Poppy would have been injured even if Daisy Bay Day Care had not been negligent. Poppy would contend that she does not face the same proof problems as those that thwarted the plaintiffs’ claims in Adeels Palace, where they could not prove how extra security personnel would, rather than might, have affected the conduct of an irrational third party gunman. In addition to distinguishing Adeels Palace factually, she would do the same with Jovanovski v Billbergia Ltd, which explored somewhat similar issues. Poppy can satisfy the civil standard of proof by arguing that her harm occurred as a result of the unsafe set of circumstances negligently created by Daisy Bay Day Care and it is difficult to imagine how her harm could have occurred had the day care taken elementary precautions to prevent the risk of harm. The defendant did not provide properly trained or an adequate number of supervisors, especially when there was an awareness of immediate dangers (such as potential assaults); it did not explicitly warn Poppy, a bright youngster, and other children in their care, of the kinds of harm they might encounter (as opposed to a vague instruction about not picking up dirty food from the ground); it did not see to it that the fun fair site, attended by a large number of young people, was subject to a reasonable cleaning system (especially with the venue’s proximity to the casino). Strong in particular should be cited in support of the latter argument. It is reasonable to conclude that Poppy’s harm was caused by each one of the day care’s acts of negligence. The absence of proper supervision was a necessary condition of her harm, which at least materially contributed to the risk of injury. As Strong, Hunt & Hunt Lawyers, Zanner v Zanner, Cox v New South Wales, Oyston v St Patrick’s College (No 2) and Settlement Group Pty Ltd v Purcell Partners stated, more than one cause can be said to contribute to the harm (such as her own conduct as well as that of the day care). Had proper staffing been provided, one can surmise that on a balance of probabilities, a potential injury like that which she suffered would not have occurred,

[page 284] as well-trained, watchful eyes would have carefully scrutinised the vulnerable children’s conduct at all times and in such a way that the harm would have been prevented. If properly licensed staff had been rostered on duty, satisfying a more appropriate ratio than one trained carer (and a babysitter) for 20 children, it is likely that Poppy’s harm would not have occurred. Unlike the factual determination in Adeels Palace, increased supervision from an adequate number of properly trained staff would have dissuaded youngsters like Poppy from misbehaving or acting in ways that were risky. Daisy Bay Day Care could perhaps argue that Poppy’s harm was caused in part by her own negligence and that nothing the day care could have done would have prevented her harm. (This contention could also go to scope of liability arguments that involve new intervening acts.) The day care may argue that regardless of what it did, it is probable that Poppy would have run ahead on her own, picking up rubbish. Poppy would respond by focusing on the poor quality of the day care’s instructions, such as its failure to properly warn her about picking up sharp objects and failure to reinforce that message at regular intervals; these failures caused her harm. Moreover, attending the fair with adequately trained staff — and not merely her sister, for whom she may have had little regard as an authority figure — would have ‘made a difference’. While Dee was by all accounts a good babysitter, she was not a licensed professional who would have understood how to properly control a large number of young children, let alone her sister. On a balance of probabilities, it is likely that using Dee to supervise so many young people was a ‘necessary condition’ of Poppy’s harm; it is likely that employing more properly licensed staff to supervise a group of youngsters would have made a difference (to use the words of Hayne and Bell JJ in Tabet v Gett). Not having an adequate number of trained staff was a necessary condition of Poppy’s harm. The immediate context, involving a six-year-old, should not go unnoticed when assessing how the failures by Daisy Bay Day Care were necessary conditions of Poppy’s harm. The reasonable day care facility in Daisy Bay Day Care’s position would have given more explicit warnings to children about how to behave. Not, perhaps, by posting notices or signs, but by having serious conversations about potential risks of harm; these would be reasonable precautions against the foreseeable risk that a child might carelessly pick up rubbish that turns out to be dangerous. Indeed, Dee, helping out that day, was aware of concerns about dangers near the casino, involving assaults. It is not a stretch to imagine other dangers or risks that ought to be guarded against, including street-based drug use, especially near a casino. Not warning about these dangers, even to a six-year-old, is negligent. Not doing so is also a cause of Poppy’s harm: like the plaintiff in Chappel, Poppy would argue that, despite her age, she would have behaved differently had she been properly warned. Daisy Bay Day Care will no doubt argue that Poppy would not have taken any notice of any warning, even if she had been told countless times about not picking up rubbish, including sharp objects. Daisy Bay Day Care may further contend that Poppy did not even adhere to directions to not run ahead. Poppy would maintain that detailed instructions about what to do and what not to do are particularly important and necessary when leading a group of excitable young children, taken on an excursion to a

fun fair, in an environment that has dangers and risks associated with it (such as being alongside a river and near the casino). It is for the day care to [page 285] adduce evidence to support any assertion that young children would not have taken any notice of explicit warnings from their carers. If it cannot do so, it should be held negligent. In Chappel, the court concluded that the defendant’s negligent failure to warn had caused the plaintiff’s injuries. Similarly, Daisy Bay Day Care failed to warn Poppy of the risks of picking up sharp objects. As was noted above, in Chappel, Gummow J highlighted how causation is connected to the purpose of attributing responsibility. Like the significance of a doctor’s failure to warn patients of risks, noted in Chappel, and argued in Rosenberg and Wallace, the failure to instruct or warn here is similarly important. Daisy Bay Day Care had the responsibility to guard against risks materialising by providing warnings properly couched in terms that a six-year-old would understand and with which a youngster would comply. As McHugh J noted in Rosenberg v Percival, a subjective test is to be used when determining how a patient would have responded to a warning of a risk associated with surgery. At common law, one must therefore ask: ‘What would Poppy have done had she been armed with an appropriate warning or caution, regarding the risk of picking up rubbish (such as needles or syringes) that had been tossed aside?’ Of course, because of Poppy’s young age, difficult evidentiary issues will no doubt arise. If Daisy Bay Day Care is in New South Wales, Queensland, Tasmania, Western Australia or Victoria, those jurisdictions’ respective Civil Liability Acts would apply. They include provisions giving effect to a subjective test similar to that outlined in Chappel and Rosenberg. However, in all those jurisdictions except Victoria, a supplementary provision prescribes an important evidentiary qualification, as a result of which Poppy would concede that she may indeed face some additional difficulty proving factual causation with respect to the ‘no warning’ breach. Poppy’s proclamation to her doctor that she would not have picked up the syringe if she had been warned it was sharp would be inadmissible in New South Wales, Queensland, Tasmania and Western Australia, because of its supposedly self-serving nature. In Elbourne v Gibbs, Basten JA correctly noted that denying courts access to this ‘indisputably relevant evidence’ is clearly detrimental to their ability to resolve disputes. Although this would make it more difficult for Poppy to prove her case in those four states, she would acknowledge that even in the remaining jurisdictions her credibility and statement would probably be challenged by the day care (as would the statement’s actual meaning). Ultimately, on these facts, denying the courts in those four jurisdictions the opportunity to hear what Poppy said to her doctor would not be fatal to her arguments with respect to this breach, as there is other evidence upon which she can rely. This includes, for example, her behaviour when asked to leave the ‘dirty lolly’: she did obey that direction. Sackville AJA’s comments in Richtoll Pty Ltd v WW Lawyers Pty Ltd (in liq) are instructive and helpful to as how inferences may be drawn from conduct (albeit with caution).

Despite her age, Poppy was a bright child, who would have followed advice and warnings had they been provided in a responsible, intelligible manner, suited to a sixyear-old. Concerns about the truthfulness of the claimant’s evidence, expressed in Lym International Pty Ltd v Marcolongo, are not relevant here, with a child as open, honest and unassuming as Poppy. Poppy should acknowledge that the court may [page 286] not agree, as it may find that properly couched warnings would not have prevented Poppy from picking up the needle, as she had ignored admonitions to not run ahead of the group, acting like the active, precocious child she was. Therefore, Poppy may wish to focus her arguments on Daisy Bay Day Care’s other breaches, which are also necessary conditions of her harm, where proof problems associated with assessing Poppy’s subjective response to an instruction or explicit warning are not relevant. For example, as was briefly noted earlier, Poppy will assert that the woeful cleaning measures at the fair venue (which included the riverfront) was a cause of Poppy’s harm (as in Strong): had reasonable care been taken to keep the venue clean, it would have been free of dangerous rubbish on the ground, including used syringes (which can cause serious harm). The presence of the needle on the ground raises an inference that her harm was caused by the day care’s negligence. Poppy would contend that the day care cannot meet the challenge of showing that the used needle would have been on the ground even if the day care and its cleaners had exercised reasonable care. Poppy would try to establish that the so-called ‘system’ the defendant had put in place was not sound. Rather than hiring properly trained commercial cleaners, Daisy Bay Day Care merely relied on a skeletal assortment of alumni to help with the cleaning; furthermore, they were merely given ill-defined directions to roam around the venue. To this point, Poppy has contended that her HIV, nerve damage and depression would not have occurred if the day care had taken adequate, reasonable precautions in the context of at least three breaches. Their breaches were necessary conditions of her harm. However, Poppy would concede that the ‘but for’ or ‘necessary condition’ test itself does not provide a satisfactory answer in all cases, including hers. The ‘scope of liability’ limb under the Acts embraces these normative devices, traditionally used by the courts — new intervening act and remoteness of harm principles. Cases like Wallace and Zanner, and Ipp JA’s comments in Ruddock state that the ‘ultimate question to be answered when addressing the second aspect is a normative one, namely, whether the defendant ought to be held liable to pay damages for that harm’. The importance of articulated policy to determine causal liability beyond establishing factual causation was emphasised in Wallace, which asserted the need to apply precedent when the normative question arises with respect to a case within an ‘established class’, such that common law methodology should not be displaced. This was endorsed in Gratax Pty Ltd v T D & C Pty Ltd and Lym International Pty Ltd. In the latter case, the court stated that determining appropriateness ‘is assisted not only by considerations of history and policy, but also by concrete examples of how the concept is applied’. The court therefore would turn to common law doctrine concerning new intervening acts and remoteness of harm when considering the qualities that help

determine whether or not Daisy Bay Day Care should be held liable. Thus, Poppy’s arguments with respect to her HIV and nerve damage will be similar in all jurisdictions — at common law in the Northern Territory and under the Acts elsewhere. Extra issues will arise when addressing Poppy’s depression, as several Civil Liability Acts include provisions concerning consequential mental harm (discussed below). Poppy would insist that her harm (HIV, nerve damage and depression) is within the scope of Daisy Bay Day Care’s liability and for policy reasons it is appropriate to [page 287] impose liability on the day care. A few factors require attention, to see if they operate in such a way that the scope of the day care’s liability does not extend to Poppy’s harm. She would contend that the day care remains responsible despite the fact that several events occurred after its negligence; none of them relieved the day care of responsibility. These include a third party discarding a dirty needle in a public place, her act of picking up the dirty needle, Dr Dire’s treatment and her family’s unsupportive response to her condition. In her view, none of these events broke the causal chain. There is little doubt that Poppy’s contraction of HIV, nerve damage and subsequent depressive illness followed ‘in the ordinary course of things’ from Daisy Bay Day Care’s negligence in these circumstances. It is appropriate that the harm that materialised should remain within the scope of Daisy Bay Day Care’s negligence (or ‘fault’, in Western Australia). Daisy Bay Day Care should not be exempt from its causal responsibility just because the dirty needle, the agent of Poppy’s HIV, was made available as a result of a third party’s conduct (tossing away the used syringe) and Poppy’s own act (picking it up). All of her harm stemmed from the careless way in which the day care managed its outing. Poppy was a vulnerable young person attending a fun fair, who happened to pick up a shiny object, which caused her harm; this was a reasonably foreseeable consequence of the day care’s carelessness, especially when there were newspaper reports of discarded dirty needles along the riverfront. Poppy may note that in Chapman v Hearse, the High Court stated that foreseeability has nothing to do with causation — it marks its outer boundaries. She would concede that the mere fact that an intervening act is reasonably foreseeable (if her act of picking up the needle is seen as such) does not necessarily mean that the negligent defendant is liable for damage that results from the intervening act. However, Poppy’s act of picking up the needle should not relieve the day care of its responsibility, as it was not a new intervening act. Indeed, her act is not deliberate human intervention or even careless (the latter is discussed below). With respect to volitional conduct, Poppy would try to argue that she was not acting with free will or free choice, like the plaintiff’s husband in Haber v Walker, and claimants in Hirst v Nominal Defendant and Medlin v State Government Insurance Commission. Her behaviour was not volitional, but an almost uncontrollable act, to pick up discarded lollies (and shiny objects) whenever the occasion presented. Poppy would contend that her behaviour was not so unreasonable that the day care

should be relieved of responsibility, especially to a child who indeed behaved as they ought to have expected. The day care’s carelessness shaped or conditioned her response. She cannot be seen to be the author of her own misfortune, unlike the adult plaintiffs in Yates v Jones, State Railway Authority of New South Wales v Wiegold and Hunter Area Health Service v Presland, where the norms and values at issue involved the interaction of the criminal and civil law and for policy reasons (Wallace) could understandably be seen to be beyond the scope of the defendants’ responsibility (using the statutory language). In Yates and Wiegold in particular, the civil law could not be seen to undermine the criminal law. Here, Poppy would not have found herself in her tragic predicament had it not been for Daisy Bay Day Care’s carelessness, which resulted in Poppy suffering a lifetime of chronic illness, rife with chronic pain. [page 288] Another argument could be raised by Poppy in this regard. In March, the High Court stated that a different approach is necessary when the intervening action is ‘in the ordinary course of things the very kind of thing likely to happen as a result of the defendant’s negligence’. In such a case, it makes no sense to regard her act as a new intervening act which would lead to the conclusion that Daisy Bay Day Care’s causal responsibility should not be found. Her youthfulness, exuberance and virtually uncontrollable attraction to lollies (and shiny objects) led to her act of picking up an item from the ground. This is exactly what one might expect of immature young people. Her act was the very kind of thing the day care should have taken reasonable care to guard against, by being meticulous in the way in which it managed an outing with so many vulnerable charges. The logic underpinning this proposition was endorsed, obiter, in Jausnik v Nominal Defendant (No 5). Using the words of the Acts, the scope of the day care’s duty of care to Poppy extended to preventing this kind of harm from occurring, like a school (reasonably) ensuring that children in its charge are not injured. Its negligence cannot be excused on the basis of her intervening conduct. Further, Daisy Bay Day Care’s failure to act with care (in a number of ways, noted above) cannot be excused causally simply because an unknown third party’s conduct — discarding a dirty syringe in a popular public place — amounted to a third-party intervention that supposedly broke the causal chain in such a way that responsibility should not be attributed to the day care. While the third party’s act of littering may have been deliberate conduct, that person cannot be presumed to have had a full understanding of the consequences of what she or he was doing, like the stonethrowing child in Haynes v G Harwood & Sons (who did not understand the effects of his volitional act). The litterer was unlike the third party actor in Yates, in that she or he could not be said to have been acting in a predatory fashion deliberately exploiting a situation, knowing the full consequences of her or his conduct. The litterer’s action was also dissimilar to those of the third party’s deliberate, fully volitional act in Rickards v Lothian, where the vandal had to know that property damage would be the consequence of his conduct. Poppy should be prepared to also contest any argument Daisy Bay Day Care may raise based on Dr Dire’s purported negligence and her own act of picking up the dirty needle,

this time viewed as carelessness to herself rather than volitional conduct, as above. The court must decide if these non-volitional acts relieved Daisy Bay Day Care of causal responsibility. Poppy could first show that neither of these acts even amounted to carelessness. Rather, they were simply errors of judgment, such that they do not relieve the day care of its liability. However, even if they were careless acts, they were not so unreasonable that they could be considered unforeseeable (noted in Mahony v J Kruschich (Demolitions) Pty Ltd). Indeed, as the court in March stated, carelessness by a claimant (Poppy picking up rubbish) and a doctor (Dr Dire’s treatment) are reasonably foreseeable in the ‘ordinary course of things’. As a matter of ‘fact and degree’ (Mahony) or ‘circumstance and degree’ (Chapman v Hearse), their conduct was not so ‘inexcusably bad’ (Mahony) that they should relieve Daisy Bay Day Care of its responsibility. The scope of its liability extended this far. At most, with respect to Poppy, this should go to apportionment, if she were found contributorily negligent. However, this in itself is unlikely, bearing in mind her age (considered in Chapter 10). [page 289] It is also important to note separate kinds of damage for which Poppy is litigating. Dr Dire could only be said to be a new intervening act with respect to the nerve damage and depression. Poppy would note, parenthetically, that if Dr Dire was found to be careless, then Poppy could recover from him for her harm and Dr Dire could seek contribution from the day care (as in Chapman v Hearse), with respect to the post-HIV harm. Contribution issues are considered in Chapter 14. Finally, there is little basis here for arguing the family’s response to Poppy’s condition would make it appropriate to relieve the day care of its responsibility with respect to her depression. If the plaintiff in Kavanagh v Akhtar could succeed despite her husband’s conduct, so too should Poppy. If Daisy Bay Day Care’s negligence was appropriately held to be the cause of Poppy’s HIV and nerve damage, at least in the sense that there were no new intervening acts that relieved it of responsibility, Poppy must still establish that her harm, in particular her depression, was not too remote a consequence of the day care’s negligent act — that is, it is appropriate for its carelessness to extend to this harm. (Remoteness arguments could perhaps be raised regarding her nerve damage as well.) Use of remoteness of harm principles are relevant to again consider whether or not and why responsibility for the harm should be imposed on the day care. In Overseas Tankship (UK) Ltd v Morts Dock and Engineering Co Ltd (The Wagon Mound (No 1)), it was established that the test for remoteness of damage is reasonable foreseeability of damage. Overseas Tankship (UK) Ltd v Miller Steamship Pty Ltd (The Wagon Mound (No 2)) established that at common law, a consequence of negligence is reasonably foreseeable if it is not ‘far-fetched or fanciful’. Further, the case of Mount Isa Mines Ltd v Pusey established that all that is necessary is that the injury suffered be of the same kind as one that was reasonably foreseeable. It is not necessary for Poppy to show that a reasonable person would have specifically foreseen the possibility of depression as a result of the day care’s negligent failure to have adequate staff on hand to supervise the children, or warn them properly about sharp objects or manage the safety of the riverfront, in terms of cleaning. All that is necessary is that a reasonable person would

have foreseen that some kind of trauma would not be a far-fetched consequence of Daisy Bay Day Care’s negligence. As Samuels JA pointed out in Rowe v McCartney, the answer to the remoteness question depends on the degree of particularity (or level of abstraction) used to approach it. This was acknowledged by both the majority and dissent in Metrolink Victoria Pty Ltd v Inglis and considered in Uniting Church in Australia Property Trust (NSW) v Miller; Miller v Lithgow City Council. Here, a reasonable person would not consider some kind of psychological trauma or psychosis to be a far-fetched consequence of the day care’s carelessness, which had led to Poppy’s HIV infection, nerve damage and depression. By way of comparison, if psychiatric disorders can be held to be foreseeable consequences of stepping off a moving school bus (Ganser syndrome in Nader v Urban Transit Authority of New South Wales) or cutting one’s hair (severe depression and a suicidal condition in Kavanagh v Akhtar) or more recently the workplace environment (Eaton v TriCare (Country) Pty Ltd), Poppy’s disorder is certainly a foreseeable kind of harm or consequence of Daisy Bay Day Care’s carelessness. A case like Waller v James, however, is distinguishable, because in that case the harm — the catastrophic stroke — was not within the risk created by the doctor’s negligence. [page 290] Daisy Bay Day Care has to take their ‘victim’ as they find her, based on the egg shell skull principle. Poppy’s psychological deterioration, perhaps connected to her family’s unsupportive response, is arguably a more foreseeable consequence than that which occurred in Kavanagh. The precise nature, cause and extent of her depression are irrelevant: some kind of trauma was not a far-fetched consequence of the day care’s negligence. Therefore, this mental disease or disorder is not too remote, even if the particular harm was unforeseeable in itself. Her depression simply goes to the extent of harm — which does not have to be foreseen. Moreover, the precise manner in which the ultimate harm occurred need not be foreseeable, according to Hughes v Lord Advocate, Gittani Stone Pty Ltd v Pavkovic and Langmaid v Dobsons Vegetable Machinery Pty Ltd. Using the words of the causation provisions in all jurisdictions except the Northern Territory, it is appropriate that the scope of Daisy Bay Day Care’s liability extends to this harm. The common law supports this conclusion. Poppy would concede that there may be complications to her claim with respect to her depression in jurisdictions with Civil Liability Act provisions that address consequential mental harm, that is, everywhere in Australia except the Northern Territory and Queensland. This harm, her ultimate depression, may be characterised as consequential to her HIV and nerve damage. Under these provisions, she must show that Daisy Bay Day Care would have foreseen that a person of ‘normal fortitude’ might, in the circumstances, have suffered a recognised psychiatric illness (definitions vary somewhat jurisdiction to jurisdiction). Poppy can convincingly argue that anyone in her circumstances would have suffered depression. She would argue that, like many individuals compelled to live with chronic illness, this would result in depression or other forms of mental harm. Poppy would contend that her response to a calamitous event, including her HIV and permanent, painful nerve damage is not beyond the norm. This

also satisfies the statutory requirement that regard be had to the nature of the bodily injury from which her mental harm arose. Recovery here again fits the requirements of the causation provisions, whereby the normative element must be taken into account. None of the terrible harm Poppy has suffered would have occurred had the day care taken reasonable care. There is no convincing basis for relieving it of responsibility, when regard is had to considerations of policy. It is ‘appropriate’ that the day care be held civilly responsible for its carelessness. Policy dictates that Poppy should be able to recover for all the harm that resulted from Daisy Bay Day Care’s negligence. Arguments for Daisy Bay Day Care 4.64 The way in which this claim must be approached in all jurisdictions except the Northern Territory is in accordance with the Civil Liability Acts, which outline the essential framework to be followed. Daisy Bay Day Care will argue that Poppy is unable to establish ‘factual causation’ whether under the Acts or at common law. It should also be noted at the outset, that even if the ‘but for’ or ‘necessary condition’ test is satisfied, which is not conceded by Daisy Bay Day Care, it is not the exclusive test or sole basis on which causation is decided. The ‘scope of liability’ or appropriateness (or otherwise) of finding liability must be addressed (and will be considered later in her arguments). [page 291] This first limb of the statutory framework reflects the common law, according to Ipp JA in Ruddock v Taylor and Simpson J in Cox v New South Wales. In Adeels Palace, the High Court of Australia did not offer a definitive view on the difference, if any, with respect to the content of the Act and the common law, as it was concerned with how the statute applied in that case. Poppy first alleges that Daisy Bay Day Care is responsible for her injury, because it was a scene-setting cause of the harm she suffered — a ‘necessary condition’ of its occurrence. She claims that she would not have suffered HIV, nerve damage and depression but for the day care’s failure(s). However, it is clear that in scientific or medical terms, Poppy’s harm arose from her picking up a dirty needle from the ground on the waterfront, near the casino and the consequence of the acts of others, including own conduct to herself. She cannot show that any negligence by Daisy Bay Day Care was a ‘necessary condition of the occurrence of the harm’ she suffered, let alone the appropriateness of imposing causal responsibility. Mirroring the common law, under the Civil Liability Acts it is clear that Poppy bears the burden of proving, on the balance of probabilities, any fact relevant to the issue of causation. At common law, in Tabet v Gett, the High Court was concerned to ensure that a relaxed standard of proof not be substituted for one based on the longstanding civil law standard, the balance of probabilities. Rather than asking whether Poppy would have been injured along the riverfront at the fair, even if the day care had not been negligent, it is better to ask how likely it was that she would have been injured even if Daisy Bay Day Care had not been negligent. The real question is: ‘Is it more likely than not that Poppy would have been injured even if Daisy Bay Day Care had not been

negligent?’ In these circumstances, the answer is ‘Yes’. On the balance of probabilities, Daisy Bay Day Care’s negligence was not the cause of Poppy’s HIV (let alone her nerve damage and depression) regardless of which of the alleged breaches is argued — the supervision of the children, the warnings, or cleaning-related concerns. It is likely that Poppy would have been injured even if Daisy Bay Day Care had not been negligent as she was a wilful, rambunctious child — virtually uncontrollable, with a terribly debilitating desire for sugar and, it would appear, shiny objects. Because she cannot discharge the onus of proof, her action against the day care must fail. By way of example, the inability to provide sufficient evidence to satisfy the requisite standard of proof yielded failed claims in Al Mousawy v Howitt-Stevens Construction Pty Ltd, Larsen v Grace Worldwide (Australia) Pty Ltd, Swift v Wearing-Smith, Moama Bowling Club Ltd v Thomson and Jackson v McDonald’s Australia Ltd. As an aside (a breach argument), Daisy Bay Day Care may not be able to resist asserting that the non-provision of more precise cautionary statements in terms Poppy would have understood was not in any way negligent. The reasonable day care facility in its position would not have said anything different to a young child because the more detail provided, the more frightened the child might become. Telling young people to ‘stay with the group and not wander off on their own’ and that they must ‘do whatever Dana and Dee told them’ is reasonable, bearing in mind their young age and what they can comprehend. However, assuming a breach of this type is found, Poppy’s causal arguments, based on the failure to provide an explicit warning couched to her in terms she now says she would have better understood, can be refuted. [page 292] The day care can argue that even if the provision of a warning about not picking up rubbish or sharp objects might have reduced the risk of injury, this is not in itself sufficient to establish a causal connection between the day care’s failure and Poppy’s HIV. Poppy must prove that she would have modified her behaviour if she had been given such a warning. Here, there may be some doubt about whether or not the relevant suggested warning would have been efficacious, noting that having chats with such rambunctious, headstrong young people is not a simple task. In any event, the fundamental question is whether or not the practicable precaution would have made any difference had it been implemented (language reminiscent of Hayne and Bell JJ in Tabet v Gett). The onus is on Poppy to establish that it would have made that difference. Because she cannot prove this, her action must fail in this regard, as in cases such as Uniting Church in Australia Property Trust (NSW) v Miller; Miller v Lithgow City Council. The statutes are clear regarding where the onus and burden lie: on Poppy. Daisy Bay Day Care will note that the children had been told to stay with their group and not run ahead. They were also told to listen to directions. Neither instruction was respected by Poppy. It seems clear that Poppy would not have taken any notice of yet another admonition or warning to act in a certain way. She seemed quite unwilling to listen to any authority figure. Indeed, she was singled out for specific direction, which was typically ignored. Because there is nothing in the evidence to suggest it would have

actually made a difference to Poppy’s behaviour, the non-provision of an explicit warning does not qualify as a ‘necessary condition’ of her harm. The Civil Liability Acts in New South Wales, Queensland, Tasmania, Western Australia and Victoria prescribe that in those states, when deciding factual causation questions, the court must employ a subjective assessment of what Poppy would have done had Daisy Bay Day Care not been negligent, in the light of all relevant circumstances. This mirrors the common law position, outlined in Chappel v Hart and Rosenberg v Percival. Importantly, on these facts, as was found with respect to the plaintiff in Rosenberg, it is impossible to see what significance any more instructions, warnings or admonitions would have had for Poppy, who was a rather wilful, precocious, self-centred youngster. As McHugh J stated in Rosenberg, to determine whether a patient would not have undertaken surgery if warned of a risk, the court must have regard to what that person would have done. There is insufficient evidence to support Poppy’s self-serving contention that she would have paid attention to any additional warnings or instructions from those working at the day care, including her sister, Dee. Having regard to Poppy’s overall behaviour pattern, the fact that she left the licorice when told to do so is not particularly convincing evidence with respect to how she would have responded to a specific warning about sharp objects. In fact, she had not listened to any other directions or instructions, as she ran along the riverfront, despite repeated efforts to get her to stop. Like so many young children at a fair, Poppy was rather giddy as she ran ahead of the group. A warning or instruction to her from a carer would not have made a difference to the way she behaved. Being the kind of child who evidently was not inclined to respect authority figures, she would have continued doing whatever she wanted to do, whenever she wanted to do it. Further, evidence about how Poppy would have behaved had explicit warnings been given might simply not be believed, as in Rosenberg. The argument that [page 293] more warnings or cautions or directions would have made a difference to Poppy’s behaviour, when it is acknowledged that she often wilfully disobeyed orders, is mere conjecture, and as such is not a reasonable inference on the facts. A number of cases, such as Odisho v Bonazzi, Fraser v Burswood Resort (Management) Ltd and Badenach v Calvert demonstrate the difficulties Poppy would face in showing she would have acted differently, ultimately leading to her claim failing. Additionally, if this case is litigated in New South Wales, Queensland, Tasmania or Western Australia, her proclamation to her doctor that she would not have picked up the needle had she been told in advance that such objects could cause pain would be (appropriately) inadmissible. Indeed, even in the remaining four jurisdictions that would permit the admission of her statement into evidence, the weight to be attached to this (implausible) self-serving comment should be the subject of serious concern (and heated attack), as would Poppy’s credibility. The court in Lym International Pty Ltd v Marcolongo correctly noted the need to exercise caution with respect to self-serving evidence given in hindsight in the failure to warn context, as here.

In determining whether this alleged breach is a ‘necessary condition’ of her HIV, Gummow J notes in Chappel that heed must be paid to the purpose of attributing responsibility when assessing causation. That case concerned the doctor’s duty to warn a patient of material risks where, importantly, the very risk that should have been warned about in fact materialised. By way of contrast, here, any purported obligation to provide an instruction to not pick up rubbish is not as significant as the duty to warn imposed on medical practitioners — the nature of the context in which that failure occurred. With respect to the other alleged breaches, as in Adeels Palace and Jovanovski v Billbergia Pty Ltd, there is no way of knowing whether or not additional care providers would have made a difference to the outcome, in probability terms. This depends on the evidence. For example, there is no evidence that any other children acted out of line (aside from Pippa, for a short while) or that additional licensed carers would have influenced or affected Poppy’s behaviour. Indeed, one of the supervisors was Poppy’s sister, who presumably (in theory) had greater influence over her than the average care provider. Seeing that even Dee could not control her sister, it is hard to imagine what difference more care providers would have made, unless they would have been required to be beside every youngster (and in particular, Poppy) every moment of the day. Once again contesting the associated breach finding (again, as an aside), the day care should not be expected to have had the capacity to prevent myriad wide-ranging potential risks of harm from materialising. Even if an enormous number of carers had been supervising the children, it is probable that Poppy’s act of picking up rubbish, which took place in a split second, could not have been prevented. Carers could be tending to other children’s needs or the incident could occur in a moment during which the assigned care provider’s eyes momentarily wandered. Therefore, the absence of additional staff should not be considered a factual cause of Poppy’s harm unless it is considered negligent to not have an abundance of care providers ever-present, virtually attached to every child every single moment of the day. This is similar to the considerations explored in Adeels Palace, where the High Court held that the plaintiffs had not proven that extra security personnel — let alone [page 294] how many — would have deterred or prevented the gunman’s attack. Although it is conceded that Adeels Palace involved irrational third party criminal conduct, it can nevertheless be argued that on the instant facts, the statutory ‘necessary condition’ requirement remains unsatisfied on a balance of probabilities. Jausnik v Nominal Defendant (No 5) applied Adeels Palace for similar reasons. Applying the rationale in Strong with respect to the cleaning breach, there is no evidence here (unlike Strong’s result, based on its facts), that the use of professional cleaners would have made a causal difference without knowing anything about the kind of system the commercial cleaners would have implemented. This is akin to Queensland v Nudd, Shoalhaven City Council v Pender and Jackson v McDonald’s Australia Ltd, where factual causation in similar contexts was not proven. Would that system have

been any different to the one used by Daisy Bay Day Care, which had personnel in place to roam the grounds and clean up messes (presumably including rubbish found on the ground)? On the instant evidence, any suggestion that the system used to clean the site was a factual cause or ‘necessary condition’ of Poppy’s harm is little more than conjecture. No inferences can be legitimately drawn that different measures would have made a difference. Finally, Daisy Bay Day Care would note that this is not a case that could conceivably engage the ‘evidentiary gap’ sections in the Civil Liability Acts, which are more relevant to complex circumstances borne of scientific uncertainty, like those that arose (albeit at common law) in House of Lords and United Kingdom Supreme Court cases, respectively Fairchild v Glenhaven Funeral Services Ltd and Sienkiewicz v Greif (UK) Ltd. As was the case in Adeels Palace, on its facts, no such evidentiary gap arises here that would justifiably engage the statutory exception or common law authorities concerning exceptional cases, as was determined in Powney v Kerang and District Health, Carangelo v New South Wales and Jovanovski v Billbergia Pty Ltd. Furthermore, those United Kingdom authorities must be carefully circumscribed, if used at all; they should not be extended beyond their already problematic spheres of operation. Having addressed Poppy’s factual causation contentions, Daisy Bay Day Care will then contend that it would not be appropriate (according to the Civil Liability Acts in all jurisdictions except the Northern Territory) for the court to hold it responsible for Poppy’s harm. It is clear that normative questions must now be addressed under statute in most jurisdictions and at common law in the Northern Territory. There are convincing normative, policy-based reasons (Wallace v Kam, Harvey v PD and noted in Zanner v Zanner) why responsibility for Poppy’s harm should not be imposed on the defendant, whether at common law or under the Acts. Even if Poppy’s contention that Daisy Bay Day Care’s negligence was a scene-setting cause of her harm is accepted (for the purpose of argument), it does not follow that it is appropriate for the scope of Daisy Bay Day Care’s liability to extend this far. In Wallace, Adeels Palace, Strong, March v E & MH Stramare Pty Ltd, Bennett v Minister of Community Welfare and Chappel v Hart, the High Court of Australia said that a ‘but for’ analysis is inadequate in cases such as the present, where there are multiple acts or events leading to the plaintiff’s injury. Here, it would not be appropriate to impose liability on the defendant, because its wrongful act was at most only an essential condition of the ultimate harm. Daisy Bay Day Care would [page 295] contend that policy supports not extending liability for Poppy’s harm to its initial (assumed) carelessness. The court must bear in mind the fact that the purpose of the inquiry cannot be ignored (discussed in Travel Compensation Fund v Tambree); here, the focus is on whether or not legal responsibility for personal injury and mental harm in the tort of negligence ought to be attributed to the defendant (highlighted in March and Chappel), whose conduct is rather far removed from the kind of harm suffered. In this instance there are several causes of Poppy’s ultimate harm. These include her own deliberate and volitional (or alternatively grossly careless) act of running ahead and

picking up dirty, dangerous litter, a third party volitionally and deliberately tossing away an obviously dangerous object, Dr Dire’s negligence and Poppy’s family setting. These are the true causes of her HIV, nerve damage and depression — not any (assumed) negligence by the day care. Therefore, Daisy Bay Day Care should not be held responsible for her harm as it is not appropriate in the circumstances for the scope of its liability to extend this far. The High Court of Australia stated in Chapman v Hearse that the mere fact that an intervening action is foreseeable does not mean that the negligent defendant will be held liable. Relying on Chapman, Daisy Bay Day Care may argue that even if Poppy’s conduct was considered to be a foreseeable consequence of its negligence, this does not mean that it is liable for her HIV, nerve damage and eventual depression that resulted from that intervening act. In the present case, Poppy’s conduct should be regarded as a causation-relieving new intervening act even if it was foreseeable as a result of the day care’s negligence. In Haber v Walker, it was held that the deceased’s suicide was not a new intervening act. According to the court, the suicide was not properly regarded as a voluntary human action and it would, in today’s language, be outside the scope of the defendant’s liability. The driver’s negligence had altered the plaintiff’s husband’s decision-making capacity. In the present case, however, Poppy’s act of picking up the rubbish is different, and it should be regarded as a voluntary human action. The day care’s negligence at most provided the background or context for Poppy’s decision to do something she was told not to do, which was indeed risky. This was her deliberate decision; the day care’s negligence could not in any way be said to have affected her so profoundly that her decision-making powers were compromised. While the day care’s negligence was arguably a condition leading to her running wild, the decision to do as she pleased, including an uncontrollable urge to pick up lollies and shiny objects was Poppy’s responsibility alone. It was a causally independent event, which operated as a break in the chain of causation such that it would not be appropriate to extend the scope of Daisy Bay Day Care’s liability to her harm. Despite her supposed addiction, it could not be seriously suggested that she was as psychologically disturbed by her condition as was the severely disfigured motor vehicle accident victim in Haber. The deceased in Haber was receiving ongoing care since his accident. By way of contrast, there is no indication here that Poppy was so affected that she was deprived of the ability to act with free will. There is no evidence of her suffering from a severely disturbed psychological state, as was the case in Haber. [page 296] Daisy Bay Day Care may contend that cases like Hirst v Nominal Defendant and Medlin v State Government Insurance Commission are readily distinguishable in that they involved actions conditioned by the wrongful acts of the defendants. In Hirst, the onduty police officer was fulfilling his responsibilities as a law enforcement officer, in a manner rather analogous to a rescuer, under a sense of moral compulsion. Unlike Poppy’s act here, in those cases the conduct of both plaintiffs was not ‘free choice’ in the sense of being truly volitional or deliberate.

The litterer’s third-party volitional conduct also makes it inappropriate to find Daisy Bay Day Care causally responsible. The dangerous needle that Poppy was exposed to came from someone acting deliberately and with full knowledge of what she or he was doing, as in Rickards v Lothian. The day care should not be held responsible for acts it did not commit. The litterer exploited the circumstances, by (presumably) knowing full well the risk of harm it would be creating in a popular, otherwise pleasant site. On this basis it would be inappropriate to hold the scope of the day care’s liability to extend to Poppy’s harm. The High Court in March held that where the intervening action is in the ordinary course of things the very kind of thing likely to happen as a result of the defendant’s negligence, then it is not a new intervening act and the harm caused by the defendant’s negligence remains within the scope of its liability. Here, HIV, nerve damage and depression are not ‘the very kind of thing’ that the day care should have been guarding against, unlike the collision in March, which the defendant should have been guarding against when he parked his truck in the middle of the road. Further, Poppy’s personal response to this situation should not be considered an ‘expected’ response, or one that (invariably) results in the ‘ordinary course of things’ as a result of the day care’s carelessness, when human behaviour can be quite unpredictable and varied. Daisy Bay Day Care could also argue that Poppy’s own conduct (discussed as volitional, above) and Dr Dire’s poor patient care are subsequent negligent acts and should relieve it of responsibility. Admittedly, Poppy’s careless conduct to herself may be most appropriately placed as a contributory negligence argument. However, Dr Dire’s carelessness was so inexcusably bad and unforeseeable (Mahony v J Kruschich (Demolitions) Pty Ltd) that it would be inappropriate to hold the day care liable. As a matter of ‘fact and degree’ (Mahony) or ‘circumstance and degree’ (Chapman), it would be misguided and incorrect to characterise any carelessness by the day care as a factor that predominantly conditioned or shaped the ensuing damage — Poppy’s nerve damage and depression. The post-HIV harm is Dr Dire’s responsibility. From a policy perspective (Wallace), it would not be appropriate to hold the day care responsible for the gross negligence of this other actor. Furthermore, Poppy’s HIV, nerve damage and depression were quite different in kind from any injury she might foreseeably have suffered as a result of Daisy Bay Day Care’s negligence. Foreseeability of the kind of harm suffered by Poppy is relevant to remoteness of damage considerations, which have been folded into the scope of liability limb under which causation is assessed, in all jurisdictions except for the Northern Territory. According to the principles laid down in Overseas Tankship (UK) Ltd v Morts Dock and Engineering Co Ltd (The Wagon Mound (No 1)), Overseas Tankship (UK) Ltd v The Miller Steamship Co Pty Ltd (The Wagon Mound [page 297] (No 2)), Mount Isa Mines Ltd v Pusey, Perisher Blue Pty Ltd v Nair-Smith and Waller v James. Poppy has to prove that she has suffered the same kind of injury as was reasonably foreseeable as a result of the day care’s negligent failure to prevent harm. Even though many things are foreseeable as a consequence of what goes on in an

excursion to a fun fair, the foreseeable consequences that Poppy might have suffered as a result of the day care’s negligence were confined to minor physical injuries, such as scraped knees, sprained ankles and soiled nappies. That is, the HIV, nerve damage and the subsequent depression she suffered are kinds of harm that are different to that which was foreseeable. Because there had been reports of discarded syringes along the riverfront, near the casino, it may be possible for Poppy to argue that being pricked by a dirty syringe was foreseeable. Even if that is accepted, Poppy must do more than merely show that her nerve damage and later depression were caused by this incident. Cases such as Nader v Urban Transit Authority of New South Wales, Kavanagh v Akhtar and Metrolink Victoria Pty Ltd v Inglis should not be relied upon, as they have twisted the meaning of the Wagon Mound (No 1) foreseeability doctrine beyond all recognition. The results in these cases seem to (inappropriately) revive the discredited principle from Re Polemis & Furness, Withy & Co Ltd. Poppy’s claim is more akin to a case like State Rail Authority of New South Wales v Yu-Mei Chu, where the plaintiff’s claim was not recoverable. Finally, the statutory provisions introduced in all jurisdictions’ Civil Liability Acts with respect to consequential mental harm (except for the Northern Territory and Queensland) would preclude Poppy’s recovery for depression. Her reaction was not that of a person of normal fortitude; moreover, it was not even consequent to or built upon a proximate or the primary physical injury (HIV). In fact, it was a response to her weight gain. It would be inappropriate for policy reasons to hold Daisy Bay Day Care liable to Poppy, when her ultimate harm, depression, was so far removed from its (assumed) carelessness, especially when so many actors had significant roles to play in contributing to the harm about which she complains. Poppy’s claim is similar to those of unsuccessful plaintiffs in cases that give effect to the underlying normative-driven approach incorporated in the Civil Liability Acts’ causation framework (and at common law in the Northern Territory), such as Rickards, where third party conduct, for example, relieved the defendant of responsibility. To find Daisy Bay Day Care liable would amount to an inappropriate reach of the civil law, to encompass remote physical and mental harm that was indeed the product of the behaviour of far too many other intervening players.

Problem 2 4.65 Some time ago, 15-year-old Phailin, who lived on the streets, was picked up by the local police, charged with a petty offence and held overnight in the Daisy Bay Remand Centre. She tried to take her own life by swallowing sleeping pills smuggled in by Meg, also on remand. She was taken to hospital, her stomach was pumped and [page 298] she was released the next day. After this incident, the Daisy Bay Remand Centre’s

authorities made a note on her file, which said that she was a suicide risk. It also noted that she must be kept away from all types of drugs, including sleeping pills. A few months later, Phailin was found guilty of selling stolen goods and sentenced to one year’s detention at Daisy Bay Youth Detention Centre, which was operated administratively by the same authorities that ran the Daisy Bay Remand Centre, located next door. She had maintained her innocence throughout her trial, protesting that she had been framed by a street acquaintance, Pria (who also happened to be detained at the Daisy Bay Youth Detention Centre, having committed other offences). Because Phailin was extremely agitated when she was being admitted to the youth detention centre, she was taken to see Dr Divine, who worked in the medical facility. Dr Divine gave Phailin several strong sleeping pills to calm her down and told the guards to repeat this dosage every hour. Those operating the youth detention centre had forgotten to pass on Phailin’s remand centre file to Dr Divine. Dr Divine also did not ask Phailin about her medical history and did not ask to see whether there were any records relevant to her medical circumstances. A few hours later, after she was given more pills by the guards, Phailin pleaded with Meg, living with her in the youth detention centre dorm, to give her some pills, because she couldn’t cope with being detained for a crime she said she had not committed. Having consumed the pills given to her by Dr Divine, the pills from the guards and the pills from Meg, Phailin suffered an overdose, resulting in a stroke. When she was released one year later, having completed her sentence, she could no longer cope with living on the street. She had to return to the abusive family home from which she had fled years before, as a result of which she now suffers from posttraumatic stress disorder. Several months after Phailin’s mental deterioration while living with her family, The Star newspaper accurately reported that Dusty’s DNA & Fingerprinting Lab Pty Ltd, a private facility used by the police to test fingerprints and DNA samples, had incorrectly identified the fingerprints and DNA on the stolen goods which had been the subject of Phailin’s trial, to be those of Phailin. This evidence had led directly to her conviction. Phailin wishes to sue Dusty’s DNA & Fingerprinting Lab Pty Ltd in negligence for her stroke and post-traumatic stress disorder. Assume that Dusty’s is not immune from liability because of its role in the trial process.

Further discussion 1. Do you think the statutory provisions under all Civil Liability Acts (except for the Northern Territory), which spell out the approach to take when attempting to resolve causation problems, are helpful? 2. Consider the legislative provisions discussed at

4.28.

Do you agree

with Basten JA’s comments in Elbourne v Gibbs to the effect that in New South Wales, [page 299] Queensland, Tasmania and Western Australia, the effect of para (b) is that courts will be ‘deprived of indisputably relevant evidence’? Is this necessarily the case? 3. What kinds of arguments could the plaintiff in Yates v Jones (see 4.39) make as to why it is appropriate for her to recover for all her harm under the Civil Liability Acts? 4. What kinds of scope of liability arguments, based on new intervening act principles (as opposed to remoteness of harm) could be made in Kavanagh? (see 4.59). 5. Would it be desirable to abandon the reasonable foreseeability test from The Wagon Mound (No 1) (see 4.54), seeing that it can lead to unpredictable results (such as Nader, Kavanagh and Metrolink)? 6. Should policy, norms and value judgments play a role in determining causal responsibility? Do you think they may be problematic, as they could be said to lead to decision making based simply on a judge’s personal beliefs and morality — a lack of objectivity? 7. Reconsider the cases of Pria, Dr Divine and Daisy Bay Youth Detention Centre (see Chapter 3). Who caused Pria’s harm — Dr Divine or the centre? Or, to put the question another way, what kinds of arguments could those defendants make based on ‘scope of liability’ principles? 8. Explore the other problems throughout the book to see where you think viable causation arguments would arise and the nature of those arguments.

Further reading Bailey S H, ‘Causation in Negligence: What is a Material Contribution?’ (2010) 30 Legal Studies 167. Balkin R P and Davis J L R, ‘Causation and Remoteness of Damage’ in Law of Torts, 4th ed, LexisNexis Butterworths, Sydney, 2009, Ch 9. Barker K, Cane P, Lunney M and Trindade F, ‘Negligence and the Scope of the Obligation to Take Care: Causation and Consequences’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 10. Bartie S, ‘Ambition versus Judicial Reality: Causation and Remoteness under Civil Liability Legislation’ (2007) 33 University of Western Australia Law Review 415. Edelman J, ‘Unnecessary Causation’ (2015) 89 Australian Law Journal 20. Hamer D, ‘“Factual Causation” and “Scope of Liability”: What’s the Difference?’ (2014) 77 Modern Law Review 155. Hart H L A and Honoré A M, Causation in the Law, 2nd ed, Clarendon Press, Oxford, 1985. Liang J and Low K Y, ‘Recognising Lost Chances in Tort Law’ (2014) Singapore Journal of Legal Studies 98. [page 300] Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Causation’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 4. —, ‘Damage and Remoteness’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 5.

Stapleton J, ‘Legal Cause, Cause-in-Fact and the Scope of Liability for Consequences’ (2001) 54 Vanderbilt Law Review 941. —, ‘Cause-in-Fact and the Scope of Liability for Consequences’ (2003) 119 Law Quarterly Review 388. —, ‘Factual Causation’ (2010) 38 Federal Law Review 467. —, ‘Unnecessary Causes’ (2013) 129 Law Quarterly Review 39.

1

2

3

4 5 6 7 8

9 10 11 12 13

14

Civil Law (Wrongs) Act 2002 (ACT) s 45(1); Civil Liability Act 2002 (NSW) s 5D(1); Civil Liability Act 2003 (Qld) s 11(1); Civil Liability Act 1936 (SA) s 34(1); Civil Liability Act 2002 (Tas) s 13(1); Wrongs Act 1958 (Vic) s 51(1); Civil Liability Act 2002 (WA) s 5C(1). Civil Law (Wrongs) Act 2002 (ACT) s 46; Civil Liability Act 2002 (NSW) s 5E; Civil Liability Act 2003 (Qld) s 12; Civil Liability Act 1936 (SA) s 35; Civil Liability Act 2002 (Tas) s 14; Wrongs Act 1958 (Vic) s 52; Civil Liability Act 2002 (WA) s 5D. Civil Liability Act 2002 (NSW) s 5D(2); Civil Liability Act 2003 (Qld) s 11(2); Civil Liability Act 2002 (Tas) s 13(2); Wrongs Act 1958 (Vic) s 51(2); Civil Liability Act 2002 (WA) s 5C(2). Civil Law (Wrongs) Act 2002 (ACT) s 45(2); Civil Liability Act 1936 (SA) s 34(2). Civil Liability Act 2002 (NSW) s 5D(3); Civil Liability Act 2003 (Qld) s 11(3); Civil Liability Act 2002 (Tas) s 13(3); Civil Liability Act 2002 (WA) s 5C(3). Civil Liability Act 2002 (NSW) s 5D(3); Civil Liability Act 2003 (Qld) s 11(3); Civil Liability Act 2002 (Tas) s 13(3); Civil Liability Act 2002 (WA) s 5C(3). Wrongs Act 1958 (Vic) s 51(3). This is the New South Wales provision: Civil Liability Act 2002 (NSW) s 5D(1), (4). The enactments in other jurisdictions are similar: Civil Law (Wrongs) Act 2002 (ACT) s 45(1), (3); Civil Liability Act 2003 (Qld) s 11(1), (4) (refers to ‘breach of duty’); Civil Liability Act 1936 (SA) s 34(1), (3); Civil Liability Act 2002 (Tas) s 13(1), (4) (refers to ‘breach of duty’); Wrongs Act 1958 (Vic) s 51(1), (4); Civil Liability Act 2002 (WA) s 5C(1), (4) (refers to ‘fault’). See H Luntz and A D Hambly, Torts: Cases and Commentary, 3rd ed, Butterworths, Sydney, 1992, p 281. The statement in question does not appear in later editions. M J Davies, ‘The Road From Morocco: Polemis through Donoghue to No-fault’ (1982) 45 Melbourne University Law Review 534. See A L Goodhart, ‘The Duty to Take Reasonable Care’ (1970) 86 Law Quarterly Review 454 at 455. Wrongs Act 1958 (Vic) s 74(1), (1)(a). Civil Law (Wrongs) Act 2002 (ACT) s 34(1), (3); Civil Liability Act 2002 (NSW) s 32(1), (3); Civil Liability Act 1936 (SA) s 33(1), (3); Civil Liability Act 2002 (Tas) s 34(1), (3); Civil Liability Act 2002 (WA) s 5S(1), (3). Civil Law (Wrongs) Act 2002 (ACT) s 34(3); Civil Liability Act 2002 (NSW) s 32(3); Civil Liability Act 1936 (SA) s 33(2)(b); Civil Liability Act 2002 (Tas) s 34(3); Wrongs Act 1958 (Vic) s 74(2); Civil Liability Act 2002 (WA) s 5S(3).

15

Civil Law (Wrongs) Act 2002 (ACT) s 35(2); Civil Liability Act 2002 (NSW) s 33; Civil Liability Act 2002 (Tas) s 35; Wrongs Act 1958 (Vic) s 75; Civil Liability Act 2002 (WA) s 5T.

[page 301]

5 Duty of Care: Basic Concepts Objectives After completing this chapter, you should: — understand the significance of the concept of duty of care in identifying which people may complain of an act of negligence; — understand how the concept of reasonable foreseeability is used in the inquiry as to whether a duty of care is owed; — be able to distinguish (with or without perplexity) between the existence of a duty and its extent (or content); — have some sense of what the ‘salient features’ approach to duty of care is, and why it has been adopted.

Key cases — Chapman v Hearse (1961) 106 CLR 112; [1962] ALR 379 — Donoghue v Stevenson [1932] AC 562 — Gala v Preston (1991) 172 CLR 243; 100 ALR 29 — Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; 194 ALR 337

— Heaven v Pender (1883) 11 QBD 503 — Hill v Van Erp (1997) 188 CLR 159; 142 ALR 687 — Sullivan v Moody (2001) 207 CLR 562; 183 ALR 404 — Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515; 205 ALR 522 [page 302]

Introduction 5.1 You may have noticed that in previous chapters negligent conduct was often referred to as ‘breach of duty’. This is because the defendant is legally liable for failing to live up to the standard of reasonable care only if she or he owed the plaintiff a duty to take reasonable care. Negligence is breach of the defendant’s duty to take reasonable care. 5.2 The concept of duty of care has not always been part of the tort of negligence. Until the case of Heaven v Pender (1883) 11 QBD 503, duty of care did not play a significant role in negligence cases. During most of the 19th century, liability in negligence depended on proof of just two things: that the defendant had failed to take reasonable care, and that that failure to take reasonable care had caused the plaintiff’s injuries. As P Winfield put it in a famous article entitled ‘Duty in Tortious Negligence’:1 [T]he development of the idea of duty … was fitful until Lord Esher gave sharp expression to it in Heaven v Pender. Meanwhile it sometimes figured in mere obiter dicta, sometimes it was barely mentioned and the decision proceeded on grounds which took no account of it, or it was taken to be adequately supported by older cases which were destitute of any consciousness of it.

Key Case Heaven v Pender

(1883) 11 QBD 503 Facts: The plaintiff was a ship painter employed by a master painter named Gray. Gray had entered into a contract with the defendant to paint a ship in the defendant’s dry dock. The defendant erected staging around the ship to allow access to the ship’s sides. The plaintiff was standing on the staging, painting the ship’s side, when one of the ropes holding up the staging broke. The plaintiff fell to the bottom of the dry dock and was injured. (Yes, Heaven fell.) He sued the defendant, alleging that his injuries had been caused by the defendant’s failure to take reasonable care in the erection of the staging. At first instance, the county court judge gave judgment for the plaintiff. On appeal, the Queen’s Bench Division allowed the appeal, holding that the defendant did not owe the plaintiff any duty of care with respect to the staging, because there was no contract between the plaintiff and the defendant, and because the defendant had not specifically invited the plaintiff onto his premises (see (1882) 9 QBD 302). The plaintiff appealed again. Issues: Did the defendant owe the plaintiff a duty of care? If so, for what reason? Decision: The Court of Appeal unanimously held that the defendant did owe the plaintiff a duty of care (see (1883) 11 QBD 503). Brett MR (who later became, and is better known as, Lord Esher) said (at 509): [page 303] [W]henever one person is by circumstances placed in such a position with regard to another that every one of ordinary sense who did think would at once recognise that if he did not use ordinary care and skill in his own conduct with regard to those circumstances he would cause danger of injury to the person or property of the other, a duty arises to use ordinary care and skill to avoid such danger. Cotton and Bowen LJJ agreed that a duty of care existed in these circumstances, but disagreed with Brett MR on the proper test for the existence of a duty of care. Cotton LJ (with whom Bowen LJ agreed) said (at 516): I am unwilling to concur with the Master of the Rolls in laying down unnecessarily the larger principle which he entertains, inasmuch as there are many cases in which the principle was impliedly negatived. Cotton and Bowen LJJ held that the defendant had impliedly invited the plaintiff onto his premises. They held that the defendant owed the plaintiff a duty of care because an occupier of premises owes a duty of reasonable care to invitees on those premises.

5.3 The difference in reasoning between the majority and the minority in Heaven v Pender (see 5.2) is fundamental. Brett MR

proposed a general test for the existence of a duty of care, which could be applied to all kinds of activities in all kinds of situations. Whenever one person was doing something that a ‘person of ordinary sense’ would recognise as posing a risk of injury to someone else, a duty to take reasonable care in doing that activity would arise. The majority rejected that proposition, confining itself to the much narrower ground that a duty of care arose because the plaintiff and the defendant were in the specific relationship of invitor and invitee. According to the view taken by the majority, a duty of care did not arise in relation to all kinds of activity, but only in relation to those activities where previous cases said a duty would arise. There was, so to speak, an unwritten list of specific relationships that gave rise to a duty of care at common law. If the relationship under consideration was ‘on the list’, a duty arose; if not, no duty of care arose. As we shall soon see, the debate between proponents of a general test and proponents of reasoning by analogy with decided cases is still continuing today. 5.4 Although Brett MR’s general test for the existence of a duty of care was not adopted (see 5.2), Heaven v Pender did establish that negligence was now to be understood in terms of duty of care. As Lord Esher MR (as Brett MR had then become) pointed out not long afterwards, in Le Lievre v Gould [1893] 1 QB 491 at 497, ‘[a] man is entitled to be as negligent as he pleases toward the whole world if he owes no duty to them’. 5.5 The majority view in Heaven v Pender (see 5.2) prevailed for the next 50 years, but Brett MR’s minority judgment became increasingly influential. In 1932, a general test for the existence of a duty of care was finally adopted in England, in the most famous case in the history of the law of torts (and possibly the whole of the common law). [page 304] Key Case Donoghue v Stevenson

[1932] AC 562 Facts: The pursuer (the Scottish word for plaintiff) went with a friend to a cafe. The pursuer’s friend bought her a bottle of ginger beer manufactured by the defender (the Scottish word for defendant). The bottle was made of dark opaque glass. The pursuer drank some of the ginger beer, which the owner of the cafe had poured from the bottle into a glass. When the pursuer’s friend poured the remainder of the ginger beer into the glass, the decomposed remains of a snail fell from the bottle. The pursuer suffered shock at the nauseating sight of the snail, and severe gastroenteritis from having consumed the polluted ginger beer. She sued the defender, alleging that her shock and gastroenteritis had been caused by the defender’s failure to take reasonable care in manufacturing and bottling its ginger beer. Before the House of Lords, counsel for the defender argued that the relationship of manufacturer and consumer was not one of the relationships that gave rise to a duty of care at common law. Counsel for the pursuer argued that where a manufacturer manufactured for human consumption an article that could not be examined by the consumer, the relationship between manufacturer and consumer was such as to give rise to a duty of care. Issue: Did the defender owe the pursuer a duty to take reasonable care in manufacturing the ginger beer? Decision: By a majority of three to two, the House of Lords held that the defender owed the pursuer a duty of care in the circumstances. The two dissenting judges, Lords Buckmaster and Tomlin, held that the defender owed the pursuer no duty because the relationship of manufacturer and consumer was not one of the specific relationships that gave rise to a duty of care according to the authorities. They adopted the approach taken by Cotton and Bowen LJJ in Heaven v Pender (1883) 11 QBD 503, saying that as there was no authority for the existence of a duty of care in this particular relationship, then no duty arose. The majority, led by Lord Atkin, laid down a general test for the existence of a duty of care. After considering the various specific relationships that gave rise to a duty of care, Lord Atkin said (at 580): At present I content myself with pointing out that in English law there must be, and is, some general conception of relations giving rise to a duty of care, of which the particular cases found in the books are but instances … The rule that you are to love your neighbour becomes in law, you must not injure your neighbour; and the lawyer’s question, Who is my neighbour? receives a restricted reply. You must take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour. Who, then, in law is my neighbour? The answer seems to be persons who are so closely and directly affected by my act that I ought reasonably to have them in contemplation as being so affected when I am directing my mind to the acts or omissions which are called in question.

5.6 While professing to do no more than summarise the existing law — ‘there must be, and is, some general conception’ — Lord Atkin effected a fundamental [page 305] change in the scope of the tort of negligence. The duty to take care could now arise in any circumstances where the defendant’s activity posed a risk of injury to others, whether or not the law had imposed a duty in that kind of case before. (Although Donoghue v Stevenson is justly famous in the Anglo-Australian common law, it should be noted that the New York Court of Appeals was the first to adopt a general concept of duty of care, in Palsgraf v Long Island Railroad Co, 162 NE 99 (1928), over a dissenting judgment protesting, as Lords Buckmaster and Tomlin did in Donoghue, that the concept was an unnecessary addition to the tort of negligence.) 5.7 The idea that there should be a general test for the existence of a duty of care took hold in Donoghue v Stevenson (see 5.5) and it has never gone away. Nevertheless, courts have struggled, particularly in the last 30 years, to devise a general test that can be applied in all of the very varied circumstances that can give rise to an action in negligence. Most of the rest of this chapter is taken up with a description of the courts’ quest for that all-purpose general test. It should be noted at the outset that Australian courts generally failed in that quest and have largely given up on the idea of finding an allpurpose general test. As Kirby J observed in Harriton v Stephens (2006) 226 CLR 52; 226 ALR 391 at [62] (see 12.2): In Australia, there is no settled methodology or universal test for determining the existence of a duty of care such as is provided in most common law countries … The inability of this court to agree on a principle of general application is unfortunate.

In Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515; 205 ALR 522 at [45], McHugh J made the same point more bluntly: ‘Since [1964], confusion approaching chaos has reigned in the law of negligence.’ Nine years later, McLure P of the Western

Australian Court of Appeal quoted McHugh J’s dictum in Apache Energy Ltd v Alcoa of Australia Ltd (No 2) (2013) 45 WAR 379; 307 ALR 376 at [15], and added: ‘Little has changed.’ Since Kirby J’s gloomy observation in Harriton, the High Court of Australia seems to have settled on something that can be described as a ‘settled methodology’, but as we shall see, the court’s new method for determining duty questions still cannot be described as a ‘universal test’. 5.8 Chaotic though the law relating to duty might be, a large part of it is relatively well settled. As Kirby J went on to observe in Harriton (see 5.7) (at [63]): [I]n practice, the absence of an agreed legal formula has not caused difficulty for the overwhelming majority of tort actions. Most tort actions fall within a recognised duty of care category … [I]n so far as physical injuries arising from a positive act are concerned, it is accepted that if the reasonable foreseeability test is satisfied, the elusive additional component of a duty of care will generally exist.

The concepts of risk and foreseeability are at the heart of Lord Atkin’s original general test for the existence of a duty of care in Donoghue v Stevenson: see 5.5. It is helpful to think in terms of a sphere of risk around every kind of activity. The outer limit of the sphere of risk is where the risk of injury ceases to be reasonably foreseeable. If the plaintiff falls within the sphere of risk, the defendant owes her or him a duty of care: if not, not. Thus, for example, in Donoghue v Stevenson [page 306] itself, the sphere of risk around the defender’s activity of manufacturing ginger beer contained all consumers of the defender’s ginger beer, including the pursuer. Those were the people who would foreseeably be put at risk if the defender failed to take reasonable care in manufacturing the ginger beer. As the pursuer was one of them, the defender owed her a duty of care.

Reasonable Foreseeability and Duty: Existence vs Extent 5.9 The duty to take reasonable care depends (at least in part) upon the reasonably foreseeable risk of injury to others if reasonable care is not taken. Reasonable foreseeability is no more demanding as part of the test for the existence of a duty of care than it is as part of the tests for standard of care and scope of liability. All that the plaintiff must show is that she or he was one of the class of people who would foreseeably be at risk of injury in some way if the defendant failed to take reasonable care, as the next case shows. Key Case Chapman v Hearse (1961) 106 CLR 112; [1962] ALR 379 Facts: A car overturned in the road as a result of the negligence of its driver, Chapman. A doctor named Cherry went to the assistance of Chapman, who had been thrown free from his car and was lying injured on the road. While Dr Cherry was tending to Chapman’s injuries, he was run over and killed by another car, driven by a man (appropriately) named Hearse. Dr Cherry’s estate sued Hearse, alleging that Dr Cherry’s death had been caused by Hearse’s negligence. Hearse joined Chapman as a third party, alleging that Dr Cherry’s death had been caused in part by Chapman’s original act of negligence in overturning his car. In order to determine whether Chapman was partly liable for Dr Cherry’s death, the court had to determine whether Chapman owed a duty of care to Dr Cherry, his rescuer. Issue: Did Chapman owe a duty to Dr Cherry, his rescuer, to drive with reasonable care, so that he would not need to be rescued? Decision: The High Court of Australia held unanimously that Chapman did owe Dr Cherry a duty of care. On this point, the High Court of Australia (Dixon CJ, Kitto, Taylor, Menzies and Windeyer JJ) said (at CLR 120–1; ALR 381–2): [T]o emphasise the contention that Chapman owed no duty of care to Dr Cherry the appellant [Chapman] enlarged upon the sequence of events which led to the final result. None of these events, it was said, was reasonably foreseeable. It was not reasonably foreseeable that Chapman would be precipitated on to the roadway, … that [Dr Cherry], as a doctor, should be first on the scene and proceed to render aid to Chapman with no other person present to warn oncoming traffic or, finally, that within a few minutes Dr Cherry should be run down by a negligent driver. But this argument assumes as the test of the existence of a duty of care with respect to Dr Cherry the reasonable foreseeability

of the precise sequence of events which led to his death and it was rejected, and rightly rejected, by the Full Court. It is, we think, sufficient in [page 307] the circumstances of this case to ask whether a consequence of the same general character as that which followed was reasonably foreseeable as one not unlikely to follow a collision between two vehicles on a dark wet night upon a busy highway … [O]ne thing is certain, and that is that in order to establish the prior existence of a duty of care with respect to a plaintiff subsequently injured as the result of a sequence of events following a defendant’s carelessness it is not necessary for the plaintiff to show that the precise manner in which his injuries were sustained was reasonably foreseeable; it is sufficient if it appears that injury to a class of persons of which he was one might reasonably have been foreseen as a consequence.

5.10 This part of the test for the existence of a duty of care is couched in very general terms. The question to be asked is virtually hypothetical: in effect, the court considers the defendant’s situation just before the alleged act of negligence, and asks: ‘What class of people might possibly be put at some risk of injury in some way if the defendant failed in some way to take reasonable care?’ That is then followed by the simple question: ‘Is the plaintiff one of those people?’ If the answer to the second question is ‘no’, then the defendant did not owe a duty to the plaintiff because the plaintiff was outside the sphere of foreseeable risk associated with the defendant’s activity. However, as we shall soon see, if the answer is ‘yes’, it does not always follow that the defendant owed the plaintiff a duty of care, as other factors may be taken into account. For present purposes, it is sufficient to note that the foreseeability test marks the outer limits of the ‘sphere of risk’ around the defendant’s conduct. 5.11 The abstract inquiry suggested by Chapman (see 5.9) merely identifies the people whom the defendant must take into account when engaging in the activity in question. It does not tell us what the defendant ought to do to protect those people from harm. In other words, it tells us when a duty exists, but not what the nature and extent of that duty are. The content of the duty — what reasonable

care requires of the defendant in the particular circumstances of the case — is usually considered at the breach stage, which was considered in Chapter 3. Thus, in Donoghue v Stevenson (see 5.5) itself, the House of Lords merely decided that the pursuer was one of the people to whom the defender owed a duty. It sent the case back to the lower courts to determine whether the defender had actually breached that duty by failing to take reasonable care. 5.12 These two questions about duty — existence and content — are closely related. For example, in Cole v South Tweed Heads Rugby League Football Club Ltd (2004) 217 CLR 469; 207 ALR 52, the plaintiff was injured when she was run over by a car outside the defendant’s club, where she had been drinking for most of the day. The plaintiff claimed that the defendant owed her a duty of care to monitor and moderate her drinking during the day and should not have allowed her to leave the club without proper assistance. Gleeson CJ said (at [1]): The [plaintiff], having suffered personal injuries, claims that the [defendant] is liable to her in damages for negligence. In the circumstances of this case, it is of

[page 308] little assistance to consider issues of duty of care, breach, and damages, at a high level of abstraction, divorced from the concrete facts. In particular, to ask whether the [defendant] owed the [plaintiff] a duty of care does not advance the matter. Before she was injured, the [plaintiff] was for some hours on the [defendant’s] premises, and consumed food and drink supplied by the [defendant]. Of course the [defendant] owed her a duty of care. There is, however, an issue concerning the nature and extent of the duty.

5.13 The High Court of Australia held (by a majority) that the defendant in Cole’s case (see 5.12) was not liable to the plaintiff. That conclusion can be expressed in two ways. It could be said that the defendant owed the plaintiff no duty to protect her from the consequences of getting so drunk that she was no longer able safely to cross the road. For example, Gleeson CJ said (at [17]): It is possible that there may be some circumstances in which a supplier of alcohol comes under a duty to take reasonable care to protect a particular person from the

risk of physical injury resulting from self-induced intoxication. However, the appellant cannot succeed in this case unless there is a general duty upon a supplier of alcohol, at least in a commercial setting, to take such care. I do not accept that there is such a general duty.

Alternatively, it could be said that the content of any duty owed to the plaintiff by the defendant did not require it to take any greater precautions than it actually took. Gummow and Hayne JJ said (at [72]): Is the content of the duty to be imposed on the Club to vary according to what it knows, or what it should know, about what arrangements the [plaintiff] had made (if any) to leave the Club? Or are all patrons to be treated alike, regardless of whether they have made arrangements to be safely taken home? Where, until about midday, the [plaintiff] was in a party of four people of whom one did not drink at all, was the Club under a duty to moderate her drinking or not? Could it rely on there being one member of the party who would be responsible for shepherding the party home safely? What steps was the Club expected to take during the afternoon, or after the point it is said that it should have recognised that she was intoxicated? If it should have not supplied her alcohol in the afternoon, it was not shown that the Club did so after the 12.30 pm bottle. If it should have done more than refuse her service, what exactly was to be expected of it?

5.14 There may seem to be little difference in substance between saying ‘There was no duty to do X’ and saying ‘The defendant owed a duty to take reasonable care, but that duty did not require it to do X’. The former sounds like a conclusion about the existence of a duty; the latter sounds like a conclusion about the content or extent of the duty owed. Both conclusions lead to the result that the plaintiff loses. Unfortunately, however, there is an important legal difference between these two ways of phrasing the conclusion. The question of whether the defendant owed the plaintiff a duty of care is a question of law. The question of whether the defendant breached the duty owed to the plaintiff is a question of fact. In the (relatively unusual) event that the case is tried before a jury, the question of whether the defendant owed the plaintiff a duty of care is one for the judge, but the question of whether the defendant breached the duty is one for the jury: see, for [page 309]

example, Ibrahim v Davis [2013] VSCA 238 at [26]–[42]. As Mason P pointed out in McPherson’s Ltd v Eaton (2005) 65 NSWLR 187 at [5], [12]: [T]he recent jurisprudence of the High Court shows that a choice must be made about the very question to be asked. Is there a broadly-stated duty to take reasonable care to avoid foreseeable risk of injury in which the reasonableness of the [defendant’s] conduct is a factual issue dependent on the circumstances? Or is there in this (as in some categories) a more confined duty expressed as having a particular content or scope? … Knowing whether one is dealing with an aspect of duty of care or an aspect of breach may be vital, for example in deciding the competency of an appeal limited to questions of law (as with the present appeal), in knowing the guidance to be drawn from earlier cases in the similar category … and in knowing the correct question to be posed in deciding breach and/or determining the role of contributory negligence.

5.15 As the quotation from Mason P’s judgment in McPherson’s case (see 5.14) shows, this is one of several aspects of the duty question on which members of the High Court of Australia have disagreed in recent years. Some members of the court say that asking ‘Did the defendant owe a duty to do X?’ confuses fact and law in an inappropriate manner, because if duty is phrased in specific terms, as a duty to do X, the breach question then becomes simply whether or not the defendant did X. Those members of the court say that it is better to confine questions about what the defendant ought to have done to the breach stage. For example, in Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; 194 ALR 337 at [106] (see 7.14), McHugh J said: The duty of care owed by a manufacturer or producer to a consumer is a duty to take reasonable care to avoid injury to the consumer. To formulate the duty in more specific terms invites error because it is likely to mix a question of law (whether a duty existed) with a question of fact (whether a breach occurred). If the duty is formulated in specific terms, the issue on breach is whether the duty has been performed in accordance with the terms of the duty as formulated. But, as Wyong Shire Council v Shirt shows, the question of breach is far more complex than an affirmative or negative answer to the question whether the defendant carried out the duty as formulated. It involves evaluating and weighing a number of competing considerations.

Other members of the court say that the general question ‘Did the defendant owe the plaintiff a duty of care?’ is too abstract, and that it can only be made meaningful by asking whether the defendant owed a duty to do a particular thing. The quotation in 5.12 from Cole’s case

shows that Gleeson CJ took that view. Similarly, in Neindorf v Junkovic (2005) 222 ALR 631 at [50], Kirby J said: [I]t is neither possible nor desirable to attempt to consider the duty of care issue independently of the breach element or, indeed, the other elements relevant to a decision on liability for negligence. The questions that the successive stages of negligence doctrine pose are not entirely free standing. They are interrelated. Negligence is a unified concept. Its subdivision into issues is adapted for convenience and to promote consistency of approach and accurate analysis. The parts should not divert attention from the whole. Thus, in deciding whether or not a duty of care exists, it is necessary to ask what the scope of the purported duty is.

[page 310] This issue was again noted by the High Court of Australia in Roads and Traffic Authority of New South Wales v Dederer (2007) 234 CLR 330; 238 ALR 761, where the appellant’s appeal was upheld in a three to two decision (see 3.41). Gummow J (with whom Heydon J agreed) stated (at [43]): First, duties of care are not owed in the abstract. Rather, they are obligations of a particular scope, and that scope may be more or less expansive depending on the relationship in question. Secondly, whatever their scope, all duties of care are to be discharged by the exercise of reasonable care. They do not impose a more stringent or onerous burden.

Most recently, a differently constituted High Court of Australia seemed to approach duty of care in Robinson Helicopter Co Inc v McDermott (2016) 331 ALR 550; 90 ALJR 679; [2016] HCA 22 (for the facts, see 4.24) as a focused, specific question covering the scope of the duty as well as its existence. Robinson Helicopter turned in part on whether the maintenance manual for a helicopter should have included a direction to check the security of bolts with a torque wrench. French CJ, Bell, Keane, Nettle and Gordon JJ said (at [82]): On the assumption that it was a realistic possibility that a torque stripe was incomplete or applied to a dirty or greasy surface in a manner that permitted the horizontal section of the stripe to rotate with the bolt and thereby create a deceptive appearance of bolt security, it might have been concluded that Robinson owed a duty of care to take reasonable care to avoid that risk eventuating. It might also have been considered that Robinson breached its duty of care by failing to include a direction in

the Manual that flex plate bolts be checked with a torque wrench at each 100 hourly inspection.

In stark contrast, in Swift v Wearing-Smith [2016] NSWCA 38 at [126], Hoeben JA of the New South Wales Court of Appeal (with whom Meagher JA agreed) criticised the trial judge’s reasoning as follows: What the primary judge did was to telescope the concepts of duty and breach retrospectively by focusing on the accident which occurred and not prospectively looking at the position of the appellants as purchasers having before them a prepurchase report with a large number of recommendations. Only a small number of the recommendations were identified as either ‘Issues’ or as ‘Safety Concern’. They did not include the recommendation in respect of the handrails.

The differences in approach typified by these two quotations were summarised in Dederer by Gummow J (at [17]): In Berrigan Shire Council v Ballerini [(2005) 13 VR 111; [2005] VSCA 159 at [7]), Callaway JA remarked that ‘[t]he relationship between duty and breach in the law of negligence is causing more perplexity than it used to do’. This appeal bears out the force of that statement.

5.16 The relationship between duty and breach continues to cause ‘perplexity’, as the next case illustrates. Of the total of eight judges at different levels who considered the case, three held that there was a duty that had been breached, three held that there was a duty but no breach, and two held that there was no duty. The six judges who held that there was a duty adopted three different formulations of the content of that duty. [page 311] Case Example Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361; 276 ALR 375 Facts: The plaintiff was employed by a company called Transfield to clean out reactors used in the production of hot briquetted iron. A company called WOMA supplied the vacuuming equipment used in the cleaning. A company called Hydrosweep supplied the vacuum truck and two operators used by WOMA. The vacuum hose that the plaintiff was using became blocked, so the plaintiff went to investigate. A Hydrosweep employee attempted to unblock the hose, passing it from side to side in front of the

suction inlet while the vacuum was still in operation. Somehow, the plaintiff’s arm got sucked into the vacuum hose, causing him serious injury. He sued the insurers of WOMA and Hydrosweep. (Both WOMA and Hydrosweep had been deregistered as companies by the time the plaintiff sued, so his action was brought against their insurers by operation of the Corporations Act 2001 (Cth) s 601AG.) The trial judge held that WOMA owed a duty but had not breached that duty, and that Hydrosweep owed the plaintiff no duty. By a majority, the Western Australian Court of Appeal held that neither WOMA nor Hydrosweep owed the plaintiff a duty. The plaintiff appealed the decision about WOMA’s liability. Issues: Did WOMA owe the plaintiff a duty of care? If so, what was the content of that duty? Decision: The High Court of Australia held unanimously that WOMA owed the plaintiff a duty of care but the members of the court disagreed about its content. By a majority of three to two, the court held that WOMA had breached that duty. In relation to the nature of the duty owed by WOMA, Heydon, Crennan and Bell JJ said (at [79]): It was reasonably foreseeable to WOMA that the vacuum facility it provided to Transfield, and particularly the hose, would be used by Transfield employees to clean out the reactors. It was also reasonably foreseeable that from time to time the hose would get blocked and have to be unblocked. And it was reasonably foreseeable that different workers, whether employed by Transfield, WOMA or Hydrosweep, might work on the task of unblocking the hose, and hand it back and forth while the suction-creating power unit was in operation. Thus there was a duty on WOMA to provide a hose, truck and vacuuming facility that would not subject foreseeable users of the hose (including those who might be inadvertent at times) to an unreasonable risk of injury in relation to the uses to which it was reasonably foreseeable that it might be put. On that basis WOMA’s duty of care extended to risks in relation to the passing of the hose, whether those risks arose from the way the hose was designed (for example, without a break box), or the way it was to be used (for example, without the protection of instruction to turn the power off while it was being handed back and forth between workers). In relation to the task of formulating a duty of care, French CJ and Gummow J said (at [19], [21]–[22]): Two things must be said as to the formulation of a duty of care and its scope and content. First, there is an inherent danger in an action in negligence to look first to the cause of damage and what could have been done to prevent that damage, and from there determine the relevant duty, its scope and content. … [page 312] The second point is that the formulated duty must neither be so broad as to be devoid of meaningful content, nor so narrow as to obscure the issues required for

consideration. With respect to the latter, Gummow and Hayne JJ in Graham Barclay said (at [192]): A duty of care that is formulated retrospectively as an obligation purely to avoid the particular act or omission said to have caused loss, or to avert the particular harm that in fact eventuated, is of its nature likely to obscure the proper inquiry as to breach.

Different classes of care may give rise to different problems in determining the nature or scope of a duty of care. In many cases a duty formulated as being one to take ‘reasonable care’ may suffice for the finding of duty in that particular case. Cases that involve the duty of a solicitor to his or her client to exercise professional skill in accordance with the retainer, the duty of a motorist towards other users of the road, or the duty owed by an occupier of land to an entrant with respect to the condition of the premises, ordinarily involve no real controversy over the scope and content of the duty of care; these are considered at [a] ‘high level of abstraction’ [Shirt v Wyong Shire Council [1978] 1 NSWLR 631 at 639 per Glass JA]. But where the relationship falls outside of a recognised relationship giving rise to a duty of care, or the circumstances of the case are such that the alleged negligent act or omission has little to do with that aspect of a recognised relationship which gives rise to a duty of care, a duty formulated at too high a level of abstraction may leave unanswered the critical questions respecting the content of the term ‘reasonable’ and hence the content of the duty of care. These are matters essential for the determination of this case, for without them the issue of breach cannot be decided. The appropriate level of specificity when formulating the scope and content of the duty will necessarily depend on the circumstances of the case. In relation to the nature of the duty owed by WOMA, French CJ and Gummow J said (at [27]): The critical question in this case concerns the scope and content of the duty owed by WOMA. The evidence outlined above supports the finding of a duty to take reasonable care to provide a hose, truck and vacuuming facility that would not subject foreseeable users of the hose to an unreasonable risk of injury. French CJ and Gummow J disagreed with the majority that WOMA’s duty extended to the passing of the hose (at [31]): For the scope and content of the duty to include the taking of additional reasonable precautions with respect to the passing of the hose, it must be reasonably foreseeable that the act of passing the hose was itself more dangerous, or bore a higher risk of injury, for the person to whom it was being passed than the mere use of the hose. This must be so as it has already been established that WOMA owed [the plaintiff] a duty to take reasonable care to ensure that the equipment provided would not subject a person using the hose to an unreasonable risk of injury, and to take reasonable care when undertaking its activities. To extend the scope and content of the duty to include a duty to take additional reasonable precautions to avoid causing injury when the hose was being passed necessarily requires there be some additional risk in the act of passing. If it was not reasonably foreseeable that the passing of the hose

exposed the receiver of the hose to any greater risk than when it was used for its intended purpose, there is no occasion for the scope of the duty to extend beyond that already owed to the user of the hose. Because French CJ and Gummow J were of the view that WOMA’s duty did not include a duty to warn users not to pass the hose under suction, they held that the duty had not been breached in this case.

[page 313] 5.17 In summary, the reasonable foreseeability test described in Chapman v Hearse (see 5.9) is a ‘To whom?’ question that focuses on the existence of a duty of care. As Cole’s case (see 5.12) shows, though, identifying to whom a duty is owed is by no means the end of the court’s inquiry — as Gleeson CJ pointed out (see 5.12), the plaintiff was plainly one of the people to whom the defendant club owed a duty, but the more difficult question in that case was about what that duty required the club to do. That was a question of the extent or content of the duty. Some members of the court think that that question should be dealt with at the breach stage (see Chapter 3); others think that it is properly part of the inquiry at the duty stage. Even when the court is dealing only with existence of a duty, rather than extent, the law is more complicated than the simple reasonable foreseeability test. Reasonable foreseeability is too broad a concept to be the general test for the existence of a duty of care envisaged by Brett MR in Heaven v Pender: see 5.2. The material covered under the next subheading deals with the High Court of Australia’s efforts to produce a general test for the existence of a duty of care.

Subsequent Developments — Proximity, Salient Features, Autonomy and Vulnerability 5.18 It should be obvious by now that the sphere of risk delimited by the concept of reasonable foreseeability is a very broad one. The

breadth of the general test for the existence of a duty of care proved troublesome, and several attempts have been made to narrow it down in one way or another. In particular, the breadth of the test caused considerable difficulty in cases of purely economic loss. A brief example should serve to illustrate why the reasonable foreseeability test is so unsuited to cases of purely economic loss. Imagine that my ship negligently spills a large quantity of a dangerous chemical into the river, and the resulting pollution affects nearby oyster beds. The government places restrictions on the catching of shrimp and fish, for fear that they may now be harmful to human health if eaten. Fishing boats are unable to make their usual catch, and have no source of income until the government embargo on fishing is cancelled. Fish processors (canneries, freezing plants, and so on) lose their supply of fish to be processed and they, too, suffer loss. Seafood restaurants in the area have to get their supplies from further away, making their prices more expensive. The increased cost of seafood and the public’s negative perception of the possibility of pollution are bad for the restaurants’ business. Waiters and kitchen staff are laid off work, or are given reduced hours. Tourists no longer want to visit the beaches, with the result that hotels and bed and breakfasts in the region have reduced numbers of visitors. Beachfront shops have fewer customers. In this example, my negligence caused physical damage to the property of only one person, the owner of the oyster beds (assuming that the oysters are not growing wild). The same act of negligence caused purely economic losses to a wide range of people. If one were to apply the undemanding reasonable foreseeability test to determine the existence of a duty of care in these circumstances, the result would [page 314] be that I would owe a duty of care to all of the businesses, employees and shops that suffered purely economic losses, as it was reasonably foreseeable that all of them might possibly suffer loss if I negligently spilled chemicals. My single, simple, act of negligence would expose

me to ‘liability in an indeterminate amount for an indeterminate time to an indeterminate class’ (to quote Cardozo CJ in Ultramares Corporation v Touche (1931) 174 NE 441 at 444). For these reasons, it used to be the case that recovery of damages for purely economic losses caused by negligence was simply not allowed. The law responded to the problem of indeterminate liability by denying liability altogether. That was the position until relatively recently, when two great cases broke new ground by allowing recovery of damages for purely economic losses caused by negligence. The first of those cases was Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465, which was concerned with purely economic losses caused by negligent misstatements. The second case was Caltex Oil (Australia) Pty Ltd v The Dredge ‘Willemstad’ (1976) 136 CLR 529; 11 ALR 227, which was concerned with purely economic losses caused by negligent acts. Those cases, and the whole issue of recovery of purely economic losses, are considered in detail in Chapter 8. For our present purposes, they are significant simply for the fact that, in each case, the court held that reasonable foreseeability of loss could not be used as the sole criterion for the existence of a duty of care in such cases. In each case, a more restrictive duty test was proposed. For a while, it seemed as if there might be three different duty tests: one for negligent acts producing physical injury or property damage, one for negligent acts producing purely economic loss and one for negligent statements producing purely economic loss (see Minister Administering the Environmental Planning and Assessment Act 1979 v San Sebastian Pty Ltd [1983] 2 NSWLR 268 at 300 per Glass JA). 5.19 In a series of cases in the High Court of Australia (Jaensch v Coffey (1984) 155 CLR 549; 54 ALR 417; Hackshaw v Shaw (1984) 155 CLR 614; 56 ALR 417; Sutherland Shire Council v Heyman (1985) 157 CLR 424; 60 ALR 1; Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16; 63 ALR 513; San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979 (1986) 162 CLR 340; 68 ALR 161; Gala v Preston (1991) 172 CLR 243; 100 ALR 29), Deane J said that there were not three different tests for the existence of a duty

of care in negligence, but only one, a test that was to be applied in all circumstances. Deane J returned to Lord Atkin’s judgment in Donoghue v Stevenson (see 5.5) and argued that it had been misinterpreted. The common understanding of Lord Atkin’s judgment was that it established the proposition that reasonable foreseeability of injury or damage was the test for the existence of a duty of care. Although Lord Atkin referred in several places to a concept which he called ‘proximity’, that was understood to be merely a synonym for ‘reasonable foreseeability’ or ‘neighbourhood’. Deane J said that those common conceptions of what Lord Atkin had said were, in fact, misconceptions. Lord Atkin had never intended that reasonable foreseeability of injury or damage should be the sole test for the existence of a duty of care. Instead, Lord Atkin had proposed that the concept of ‘proximity’ of relationship should operate as an additional, limiting requirement over and above that of reasonable foreseeability of injury or damage. [page 315] 5.20 Thus, however Donoghue v Stevenson might previously have been understood, Deane J said that it should properly be understood as imposing a two-stage test for the existence of the duty of care: first, that loss or damage of some kind to someone such as the plaintiff was a reasonably foreseeable consequence of the defendant’s failure to take reasonable care, and second, that there was the requisite degree of proximity in the relationship between the defendant and the plaintiff. In Sutherland Shire Council v Heyman (at CLR 495; ALR 53–4), Deane J said: Reasonable foreseeability of loss or injury to another is an indication and, in the more settled areas of the law of negligence involving ordinary physical injury or damage caused by the direct impact of a positive act, commonly an adequate indication that the requirement of proximity is satisfied. Lord Atkin’s notions of reasonable foreseeability and proximity were however distinct and the requirement of proximity remains as the touchstone and control of the categories of case in which the common law of negligence will admit the existence of a duty of care …

In Gala v Preston (1991) 172 CLR 243; 100 ALR 29, a majority of the High Court of Australia adopted Deane J’s ‘proximity’ test. Mason CJ, Deane, Gaudron and McHugh JJ said (at CLR 253; ALR 36): The requirement of proximity constitutes the general determinant of the categories of case in which the common law of negligence recognises the existence of a duty to take reasonable care to avoid a reasonably foreseeable and real risk of injury. In determining whether the requirement is satisfied in a particular category of case in a developing area of the law of negligence, the relevant factors will include policy considerations.

In other words, ‘proximity’ meant different things in different classes of cases. That is why it was said that the single test of foreseeabilityplus-proximity could be used as a ‘general determinant’ in all types of cases in negligence. 5.21 For at least six years, from Gala in 1991 (see 5.19) to 1997, a majority of the High Court used Deane J’s proximity-based approach, with Brennan CJ leading a vocal minority that rejected the proximity test in favour of an ‘incremental approach’ very like that used by Cotton and Bowen LJJ in Heaven v Pender (see 5.2), developing new categories of negligence ‘incrementally and by analogy with established categories’: see Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 481; 60 ALR 1 at 43–4. In 1997, a majority of a differently constituted High Court abandoned the concept of proximity as being insufficiently precise to constitute a useful test, in Hill v Van Erp (1997) 188 CLR 159; 142 ALR 687. Although the majority in Hill rejected proximity, there was no clear agreement on what test should be used in its place. More recently, a yet differently constituted High Court explained, in retrospect, what was wrong with the proximity test. In Miller v Miller (2011) 242 CLR 446; 275 ALR 611 at [60], French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ observed: [I]t is important to remember why proximity has been discarded from the Australian judicial lexicon. The expression is one which has been found not to be useful. It is not useful because it neither states, nor points to, any relevant principle that assists in the resolution of disputed questions about the existence of a duty of care, beyond

[page 316]

indicating that something more than foreseeability of damage is necessary. Instead, ‘proximity’ was used as a statement of conclusion. And, because it was used as a statement of conclusion, it is important to look to the reasoning that lay behind the conclusion, rather than the bare fact that the conclusion was expressed by using the terms ‘proximity’ or ‘relationship of proximity’.

5.22 Observing in 1998 that ‘proximity’s reign … has come to an end’ (Pyrenees Shire Council v Day (1998) 192 CLR 330; 151 ALR 147 at [237]–[238] (see 7.12)), Kirby J made the next concerted attempt to state a general test for duty of care that could be applied in all cases. Kirby J championed the three-stage test used in England, which was first suggested by Lord Bridge in Caparo Industries plc v Dickman [1990] 2 AC 605 at 617–18. In Pyrenees, Kirby J described the three-stage Caparo test as follows (at [244]): To decide whether a legal duty of care exists the decision-maker must ask three questions: 1. Was it reasonably foreseeable to the alleged wrong-doer that particular conduct or an omission on its part would be likely to cause harm to the person who has suffered damage or a person in the same position? 2. Does there exist between the alleged wrong-doer and such person a relationship characterised by the law as one of ‘proximity’ or ‘neighbourhood’? 3. If so, is it fair, just and reasonable that the law should impose a duty of a given scope upon the alleged wrong-doer for the benefit of such person?

5.23 Kirby J adopted the three-stage Caparo test in a series of cases (see Romeo v Conservation Commission (NT) (1998) 192 CLR 431; 151 ALR 263 at [117]–[118] (see 3.46); Perre v Apand Pty Ltd (1999) 198 CLR 180; 164 ALR 606 at [289]–[302] (see 8.34); Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1; 167 ALR 1 at [223]–[235] (see 7.13); Brodie v Singleton Shire Council (2001) 206 CLR 512; 180 ALR 145 at [242]–[243] (see 7.39)). However, in Sullivan v Moody (2001) 207 CLR 562; 183 ALR 404, the High Court of Australia rejected the Caparo test, too, saying (at [49]): What has been described as the three-stage approach of Lord Bridge of Harwich in Caparo Industries Plc v Dickman does not represent the law in Australia … There is … a danger that, the matter of foreseeability (which is often incontestable) having been determined, the succeeding questions will be reduced to a discretionary judgment based upon a sense of what is fair, and just and reasonable as an outcome in the particular case. The proximity question has already been discussed. The question as to what is fair, and just and reasonable is capable of being misunderstood as an

invitation to formulate policy rather than to search for principle. The concept of policy, in this context, is often ill-defined. There are policies at work in the law which can be identified and applied to novel problems, but the law of tort develops by reference to principles, which must be capable of general application, not discretionary decision-making in individual cases.

However, like Hill v Van Erp (see 5.21) before it, Sullivan v Moody established what was not the duty test, without explaining clearly what the general test should [page 317] be, because the court focused only on whether a duty should be found in the circumstances of the case before it. 5.24 The currently prevailing approach to duty questions is to use a multi-factorial approach focusing on ‘salient features’. This phrase was first used by Stephen J in Caltex Oil (Australia) Pty Ltd v The Dredge ‘Willemstad’ (at CLR 576; ALR 261) (see 5.18), but its most recent champion has been Gummow J, who first used the expression in Perre v Apand Pty Ltd (at [198]–[199]) (see 8.34) to suggest an incremental approach very similar to that advocated by Brennan CJ in the 1990s (see 5.21): The question in the present case is whether the salient features of the matter gave rise to a duty of care … In determining whether the relationship is so close that the duty of care arises, attention is to be paid to the particular connections between the parties. … There is no simple formula which can mask the necessity for examination of the particular facts. … The case law will advance from one precedent to the next. Yet the making of a new precedent will not be determined merely by seeking the comfort of an earlier decision of which the case at bar may be seen as an incremental development, with an analogy to an established category.

5.25 The language of ‘salient features’ has gradually worked its way into common usage, both in the High Court and in lower courts, as a description of the factors taken into account when determining whether a duty of care should (or should not) be imposed. The phrase was used in Graham Barclay Oysters Pty Ltd v Ryan (at [149]) per Gummow and Hayne JJ (see 7.14); in Waller v James (2006) 226 CLR

136; 226 ALR 457 at [34] per Kirby J; in Harriton v Stephens (at [64], [72]) per Kirby J (see 12.2); in Kuhl v Zurich Financial Services Australia Ltd (at [20]) per French CJ and Gummow J (see 5.16); in Barclay v Penberthy (2012) 246 CLR 258; 291 ALR 608 at [173] per Kiefel J (see 8.39); in Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 (2014) 254 CLR 185; 313 ALR 408 at [30] per French CJ; in Badenach v Calvert (2016) 257 CLR 440; 331 ALR 48 at [51] per Gageler J. It has also been used on many occasions in lower courts. 5.26 Two ‘salient features’ that have recently received considerable attention are the autonomy of the plaintiff and the vulnerability of the plaintiff, in the sense of her or his ability to protect against the harm in question. As we shall see in Chapter 6, in both CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board (2009) 239 CLR 390; 260 ALR 606 (see 6.14) and Stuart v Kirkland-Veenstra (2009) 237 CLR 215; 254 ALR 432 (see 6.14), the High Court stressed the plaintiff’s autonomy, meaning the ability and responsibility to take care of oneself, as a reason for denying the existence of a duty on others to take positive steps for the plaintiff’s safety. In Chapter 8, we see that in Perre v Apand Pty Ltd (see 8.34), Woolcock Street Investments Pty Ltd v CDG Pty Ltd (see 8.36) and a string of lower court cases following Woolcock (see 8.38), the plaintiff’s vulnerability, meaning the ability to protect oneself from harm, was regarded as a key (and sometimes the only) ‘salient feature’ in considering whether the defendant owed the plaintiff a duty not to cause purely economic loss. [page 318] 5.27 Important though the developing ‘salient features’ of autonomy and vulnerability seem to be, it should be remembered that no salient feature is supposed to be regarded as an essential requirement for the existence of a duty of care, except perhaps for the foreseeability of harm. For example, in Barclay v Penberthy, the High Court of Australia held that a duty can arise without vulnerability in the Woolcock sense: see 8.39. Many features of the case may be regarded as ‘salient’. Having

reluctantly conceded defeat on his favoured Caparo test in Graham Barclay Oysters Pty Ltd v Ryan (at [238]) (see 5.22), Kirby J gamely, but constructively, attempted to follow the ‘salient features’ approach in Harriton v Stephens (at [64]–[65]) (see 12.2): [I]nstruction on the duty issue can be secured from several ‘salient features’ that have been identified as potentially relevant to the existence of a duty. In Sullivan three particular considerations were identified which will often point against the existence of a duty. These were: (1) that finding a duty of care would cut across or undermine other legal rules; (2) that the duty asserted would be incompatible with another duty; and (3) that to recognise a duty would expose the defendant to indeterminate liability. Elsewhere, factors capable of supporting a duty of care have been identified. These include: (1) vulnerability on the part of the plaintiff; (2) special control; or (3) knowledge possessed by the defendant about the circumstances that gave rise to the damage suffered by the plaintiff. [Footnotes omitted.]

Allsop CJ, Chief Justice of the Federal Court of Australia, has the spirit of an encyclopaedist. His judgments usually contain extensive, detailed and thorough analyses of every aspect of the issues before him. As President of the New South Wales Court of Appeal, he was faced with a novel duty of care question in Caltex Refineries (Qld) Pty Ltd v Stavar (2009) 75 NSWLR 649. Allsop P analysed the High Court’s rejection of every previous duty test (see 5.19–5.23) and went on to say this about the ‘salient features’ approach (at [102]–[104]): This rejection of any particular formula or methodology or test the application of which will yield an answer to the question whether there exists in any given circumstance a duty of care, and if so, its scope or content, has been accompanied by the identification of an approach to be used to assist in drawing the conclusion whether in novel circumstances the law imputes a duty and, if so, in identifying its scope or content. If the circumstances fall within an accepted category of duty, little or no difficulty arises. If, however, the posited duty is a novel one, the proper approach is to undertake a close analysis of the facts bearing on the relationship between the plaintiff and the putative tortfeasor by references to the ‘salient features’ or factors affecting the appropriateness of imputing a legal duty to take reasonable care to avoid harm or injury. These salient features include: (a) (b) (c)

the foreseeability of harm; the nature of the harm alleged; the degree and nature of control able to be exercised by the defendant to avoid harm;

[page 319] (d)

the degree of vulnerability of the plaintiff to harm from the defendant’s conduct, including the capacity and reasonable expectation of a plaintiff to take steps to protect itself; (e) the degree of reliance by the plaintiff upon the defendant; (f) any assumption of responsibility by the defendant; (g) the proximity or nearness in a physical, temporal or relational sense of the plaintiff to the defendant; (h) the existence or otherwise of a category of relationship between the defendant and the plaintiff or a person closely connected with the plaintiff; (i) the nature of the activity undertaken by the defendant; (j) the nature or the degree of the hazard or danger liable to be caused by the defendant’s conduct or the activity or substance controlled by the defendant; (k) knowledge (either actual or constructive) by the defendant that the conduct will cause harm to the plaintiff; (l) any potential indeterminacy of liability; (m) the nature and consequences of any action that can be taken to avoid the harm to the plaintiff; (n) the extent of imposition on the autonomy or freedom of individuals, including the right to pursue one’s own interests; (o) the existence of conflicting duties arising from other principles of law or statute; (p) consistency with the terms, scope and purpose of any statute relevant to the existence of a duty; and (q) the desirability of, and in some circumstances, need for conformance and coherence in the structure and fabric of the common law. There is no suggestion in the cases that it is compulsory in any given case to make findings about all of these features. Nor should the list be seen as exhaustive. Rather, it provides a non-exhaustive universe of considerations of the kind relevant to the evaluative task of imputation of the duty and the identification of its scope and content.

Although Allsop P’s dauntingly long list does not include any explicit reference to policy considerations, it would be naïve to think that policy plays no part in the courts’ consideration of duty questions. In Sullivan v Moody (see 5.23), the High Court rejected the Caparo test, which explicitly required a consideration of what is ‘fair, just and reasonable’, but it would be a mistake to think that policy considerations have no role to play under the salient features approach. The increasing importance of the salient features of autonomy and vulnerability can be seen as the expression of a judicial policy favouring increased self-reliance and fewer avenues to seek

compensation from others. As well, there are cases like D’OrtaEkenaike v Victoria Legal Aid (2005) 223 CLR 1; 214 ALR 92, where the High Court held that an advocate (barrister or solicitor) is immune from suit for negligence in the conduct of a case, whether in court or outside, for reasons based principally on policy considerations about the undesirability of reopening cases [page 320] that have already been resolved. The role of policy is no longer as frankly stated as it has been in the past, but it has not disappeared completely under the salient features approach. 5.28 In summary, we can see that 30 years of concerted intellectual effort by the High Court of Australia in a long series of cases (of inordinate length) have produced nothing more than the rather lame conclusion stated by Gleeson CJ, Gaudron, McHugh, Hayne and Callinan JJ in Sullivan v Moody (at [50]): ‘Different classes of case give rise to different problems in determining the existence and nature or scope, of a duty of care.’ The salient features approach allows a judge to pick and choose from a ‘non-exhaustive universe of considerations’ (see 5.27), any of which may be thought relevant in any particular case. Even if one tries to list the possible salient features that might be taken into account, as Kirby J did in Harriton v Stephens (see 5.27) and Allsop P did in Caltex Refineries (Qld) Pty Ltd v Stavar (see 5.27), the salient features approach still suffers from exactly the same weakness that the proximity test did. The test itself does not indicate which features are ‘salient’ in a particular set of circumstances, just as the proximity test did not indicate how much ‘proximity’ was required in a particular case. Just as the Miller v Miller court accused the proximity test of doing (see 5.21), the nebulous salient features approach permits, in effect, ‘a statement of conclusion’, allowing a judge to choose any features that support the desired conclusion that a duty does or does not exist. A judge in one case could point to some factors as ‘salient’ in arriving at the conclusion that a duty was owed, while a different

judge in a similar case could point to different factors as ‘salient’ in arriving at the conclusion that a duty was not owed. In Graham Barclay Oysters Pty Ltd v Ryan (see 7.14), Kirby J made the following observation about the quest for a duty test (at [244]): Perhaps this is the ultimate lesson for legal theory in the attempted conceptualisation of the law of negligence and the expression of a universal formula for the existence, or absence, of a legal duty of care on the part of one person to another. The search for such a simple formula may indeed be a ‘will-o’-the-wisp’. It may send those who pursue it around in never-ending circles that ultimately bring the traveller back to the very point at which the journey began. Thus we seem to have returned to the fundamental test for imposing a duty of care, which arguably explains all the attempts made so far. That is, a duty of care will be imposed when it is reasonable in all the circumstances to do so.

To put it bluntly, the High Court of Australia has failed completely to provide a workable legal test that either a trial court or a practising lawyer can apply with confidence to determine whether a duty of care exists in a particular case. The search for a simple formula may be a ‘will-o’-the-wisp’ but some kind of formula is still needed by those who practise outside the lofty confines of the High Court of Australia. 5.29 Although the lack of a coherent duty test is a profound problem, we should close by recalling another of Kirby J’s observations in Harriton v Stephens, quoted above at 5.8. The concept of duty of care plays an active role only in the small minority of more complex cases, which are considered in Chapters 6–9. In the bulk [page 321] of more straightforward cases, which are about physical damage or personal injury, there is always a duty to take care because reasonable foreseeability of damage is enough to give rise to a duty of care in such cases, and because reasonable foreseeability of damage is so undemanding a test. Indeed, in practice, it is usually unnecessary even to consider whether a duty of care exists; in most cases, there is clearly a duty, and the important question is whether the defendant has breached that duty by failing to take reasonable care.

Problem 1 5.30 When he turned 18, Dustin was transferred from (the privately run) Daisy Bay Youth Detention Centre to the nearby (privately run) Daisy Bay Adult Detention Centre, both of which are on the outskirts of Daisy Bay. Initially detained for several thefts committed as a teenager, Dustin had never been violent. This changed after a few months in the adult institution, where Dustin had to learn to protect himself, as he increasingly found himself embroiled in physical altercations with other inmates and staff. Despite never having used drugs previously, this too changed. His ability to resist drug use crumbled. Dustin acquired an addiction to heroin, which he and his fellow inmates injected intravenously, sharing syringes. The detention centre knew of this problem. In response, after debating what to do for several weeks, the centre decided to ban visits in an effort to crack down on drug smuggling into the jail. Supply dried up. Desperate for a hit, Dustin escaped. Hitching a ride to the centre of Daisy Bay, Dustin contacted Meg, a former friend from the Daisy Bay Youth Detention Centre. She shared a hit and her home with Dustin, helping him remain hidden for six months. As the campaign to find him escalated, so did Dustin’s desperation. Wanting to settle some old scores, he paid a visit to the ‘lousy lawyer’ who lost his first case, in Serenity Springs, about 30 kilometres away. As he was about to enter the lawyer’s office, he caught a glimpse of a stack of newspapers at ‘Paige’s Papers’, a newsstand located next door to the law firm and opposite the courthouse where Dustin felt he had been unjustly convicted. One of the tabloids had yet another article about Dustin (accompanied by a particularly unflattering photo) demanding that Dustin be apprehended. Recognising Dustin from the photo, Paige, about to call the police, was confronted by Dustin. Approaching her, he cautioned, ‘Don’t you dare make that call …!’. He then stabbed Paige with a dirty syringe he had just used. Dustin ran off. He has not been found. Months later, Paige’s daughter, Padgett, was born with HIV, clearly the result of the stabbing. Padgett now sues Daisy Bay Adult Detention Centre. This private facility denies liability to Padgett on the ground that it did not owe Padgett a duty of care. Advise Padgett and the Daisy Bay Adult Detention Centre. (This scenario is very loosely based (in part) on New South Wales v Godfrey (2004) Aust Torts Reports ¶81-741; [2004] NSWCA 113 (see 6.18). You may wish to return to this problem after you have considered additional duty principles in Chapter 6, ‘“Affirmative Action”: The Duty to Act’.)

[page 322]

Discussion

Arguments for Padgett 5.31 In determining whether the Daisy Bay Adult Detention Centre owed Padgett a duty of care, the first question that must be asked is whether it was reasonably foreseeable that negligence of some kind on the centre’s part would be ‘not unlikely’ to cause some kind of damage to a class of persons of which Padgett was one. Padgett is not required to show that the precise chain of events that gave rise to her contraction of HIV was reasonably foreseeable. In Chapman v Hearse, a driver negligently crashed his car, and was thrown onto the road. A doctor stopped to assist him, and was run over and killed by another car. The High Court of Australia held that the first driver owed the doctor a duty of care and that it was not necessary to show that the precise chain of events was reasonably foreseeable. It was sufficient to ask whether it was reasonably foreseeable that a class of persons of which the doctor was one might suffer some kind of injury of the same general character as that suffered by the doctor. The sphere of risk delimited by the concept of reasonable foreseeability is a broad one, and is readily satisfied here. It is not necessary to ask whether it was reasonably foreseeable that Dustin would become violent over time, develop an addiction, escape, be at large for months, decide to settle an old score, be in the vicinity of a newsstand, and stab someone who was pregnant. It is sufficient to ask whether someone such as Padgett might suffer an injury of the same general character as what she suffered if the detention centre failed in some way to take reasonable care when managing its institution. (Depending on the nature of the question asked (see below), the court might have regard to the detention centre’s conduct in not keeping the jail drug-free and making sure increasingly violent inmates did not escape.) Unfortunately, illicit drug use in jails is not uncommon. The same may be said with respect to escapes from jails. It is not fanciful to suppose that, if proper security measures are not taken and greater attention is not paid to the propensity of every detainee to become desperate, then she or he might do something contrary to the rules. Some might even argue this is indeed quite likely, let alone foreseeable. It is likely that Dustin would be feeling increasingly out of control as his drug use and propensity for violence became more acute. Padgett was a member of the class of persons that would foreseeably be put at risk if the detention centre failed to carefully keep the detention centre drug-free, less violent and under proper control, with appropriate rehabilitation and counselling provided to inmates seen to be spiralling downwards. Debates about what to do in response to these concerns should not last several weeks. It is immaterial that Padgett was a foetus at the time of injury, as she was just as reasonably foreseeable as was Paige, someone in the ‘vicinity’ of the detention centre (albeit 30 kilometres away). She was certainly as foreseeable, among a class of persons that could be affected by the defendant’s careless conduct, as was the passer-by in Chapman, where he chose to expose himself to the risk of injury by stopping to provide assistance to the first driver. It was foreseeable in general terms that someone like Padgett (or Paige) might be the victim of a violent, desperate offender who had escaped from a correctional institution. In fact, in this [page 323]

type of scenario, the centre was obliged to do more than it did when responding to the potential harm developing in the detention centre. It is foreseeable that a class of persons will be at risk if the obvious dangers associated with drug use and violence in a jail are not addressed immediately. Those errors as well as the inability to respond adequately to Dustin’s escape by apprehending him right away (by jail authorities or, more plausibly, the police), place this class of persons in danger. While the foreseeability question, focusing on ‘to whom’ the duty is owed, is clearly about the existence of the duty, there would be differences in the approach to the way in which the duty question is cast, which could affect how it is answered. Padgett would rely on McHugh J’s approach to the duty question, articulated in Graham Barclay Oysters Pty Ltd v Ryan, with his emphasis on its existence, rather than its extent or content. As McHugh J notes, the latter is more appropriately addressed as a breach question. Padgett would contend that the question to be asked is along the following lines: ‘Did the defendant, the detention centre, have a duty to take reasonable care to a member of the public?’ Padgett should resist the centre’s likely argument that Padgett’s question is too abstract, and its likely contention that it should be formulated more precisely than this. Padgett should emphasise that if the centre adds specific facts to the duty question (such as whether there is a duty to take care by having more supervision), this would amount to converting this question of law into one of fact, as discussed in cases like Cole v South Tweed Heads Rugby League Football Club Ltd, Roads and Traffic Authority of New South Wales v Dederer and Kuhl v Zurich Financial Services Australia Ltd, which demonstrate diverse judicial approaches. While it is conceded that most recently, the High Court seemed to approach duty of care in Robinson Helicopter Co Inc v McDermott as a focused, specific question covering the scope of the duty as well as its existence, in Swift v Wearing-Smith, Hoeben and Meagher JJA of the New South Wales Court of Appeal, took an opposite approach. Even if Padgett convinces the court to ask a general question at this stage, confining the inquiry to the existence of the duty and not its extent, she must in any event go on to argue that more than foreseeability is required to be satisfied here for a duty to be found. She should therefore acknowledge that reasonable foreseeability of injury or damage is not always sufficient in itself to give rise to a duty of care, and concede that reasonable foreseeability is too broad a concept and too readily satisfied to be the general test for finding a duty in a novel claim. While Padgett will no doubt succeed in being held to be within the sphere of foreseeable risk associated with the centre’s activities, and not beyond its outer limits, she must then use the modern approach of the High Court of Australia to convince the court hearing her case that a duty was owed to her. For several years the High Court had stated that the proximity of relationship between plaintiff and defendant was an overriding requirement that must be satisfied in novel categories of negligence cases: see, for example, Deane J in Sutherland Shire Council v Heyman and a large number of cases that had applied his formulation. A majority of the High Court expressed dissatisfaction with this test in Hill v Van Erp. In Sullivan v Moody, the five members of the court (in a single judgment) emphatically discarded the use of proximity as an umbrella principle or ‘touchstone’ of liability. This was more recently endorsed in Miller v Miller by a differently constituted High Court.

[page 324] On the other hand, in several cases, Kirby J (who did not decide Sullivan) suggested that Australian courts should adopt the three-stage test used by the House of Lords in Caparo Industries plc v Dickman. However, in Sullivan, the Caparo test also was strongly criticised as an inappropriate basis on which to decide whether a duty of care exists. In Graham Barclay Oysters Pty Ltd v Ryan, even its main proponent, Kirby J, relented on advocating its continued use. However, while the court in Sullivan stated that there is ‘no simple formula’ to be used, it did not clearly articulate an alternative test that should be employed. It still has not done so, as Kirby J observed in Harriton v Stephens and is evident in many other cases. Therefore, Padgett will have to find her way through the ‘confusion approaching chaos’ (as McHugh J characterised the methodology used to address the duty question in Woolcock Street Investments Pty Ltd v CDG Pty Ltd) to establish that a duty was owed her. The High Court and lower courts now favour a multi-factorial or ‘salient features’ approach. As Gummow J stated, the law requires that additional salient features (or factors) beyond foreseeability need to be present to justify imposing a duty, and these should be examined when addressing duty questions in novel circumstances. Therefore, the salient features approach (see Perre v Apand Pty Ltd) is a legitimate basis on which to address duty questions. It also had some influence in Sullivan, in that many of the matters scrutinised by the court in that case were ‘classic’ salient features. A number of judges in Graham Barclay Oysters Pty Ltd v Ryan, Woolcock Street Investments Pty Ltd v CDG Pty Ltd and Harriton v Stephens employed the salient features approach, whereby the ‘totality of the relationship’ is considered. Without presuming to construct an exhaustive list, Allsop P in Caltex Refineries (Qld) Pty Ltd v Stavar highlights many examples of salient features that have arisen in the case law. Padgett would argue that in the circumstances, the detention centre owed her a duty of care, based on an analysis of the salient features of her claim. Having regard to a particularly important salient feature, because Padgett was injured when she was a foetus and utterly unable to protect herself, she was certainly vulnerable to the centre’s inadequate prison management, which did not properly prevent the risks associated with drug use in the jail, did not address escalating violence involving Dustin and did not prevent the escape. Adverting to another significant salient feature, Padgett would argue that the detention centre had special control over the situation (again noted by Kirby J in Harriton): as Dustin’s custodian, the detention centre had been in a position to respond to the risks of harm that were increasing in the jail and about which it had knowledge (another salient feature). It should have come as no surprise to the centre that allowing drug use to take place before doing much about it, and waiting too long to in fact do anything about it, followed by a period in which drugs on which inmates were dependent were not available, could lead to the kind of desperation that ensued here. It had knowledge of the risks. Some of the other salient features that the court could explore do not thwart Padgett’s claim. For example, finding a duty here would not negatively affect Padgett’s autonomy and, as noted previously, as a foetus, she was clearly vulnerable (unlike the intoxicated motor cycle driving deceased in CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board and the deceased in Stuart v Kirkland-Veenstra, who

committed suicide). Further, a duty in these circumstances would not cut across nor undermine other legal rules (Harriton; Sullivan). Indeed, [page 325] here, they would reinforce one another. For example, finding civil liability would enhance, and not be in conflict with, attaining high standards of prison management and regulation. Finally, there should be no fear of indeterminate liability, a significant salient feature in many cases (noted by Kirby J in Harriton). Although this is one of the main reasons for resisting the imposition of duties of care in purely economic loss cases, it can be noteworthy in other contexts, as in Sullivan. Here, Padgett is one of the relatively few people who could foreseeably suffer injury as a result of the centre’s negligence, as her mother, Paige, lived in Serenity Springs, where the escapee had previous significant connections. Because Padgett and her mother were in the physical vicinity of someone with whom Dustin, an escapee, had previously had contact (his lawyer) and they were in a locale that was meaningful to him (the site of his conviction), Padgett could be said to be part of an ascertainable (and not indeterminate) class of persons affected by the Daisy Bay Adult Detention Centre’s careless conduct. Arguments for Daisy Bay Adult Detention Centre 5.32 In order to establish that the Daisy Bay Adult Detention Centre owed Padgett a duty of care, Padgett must show that it was reasonably foreseeable that someone like her might suffer damage of some kind if the centre failed to take reasonable care in managing the facility by, for example, keeping the institution free of drugs and violence. Considering the foreseeable consequences of carelessly managing a jail, the centre would acknowledge that there might be an impact on individuals beyond the prison. Certainly, a prisoner could escape and cause harm to others in the community. However, the centre would remind the court that it is important to avoid the wisdom of hindsight in considering what was reasonably foreseeable to someone in its position. When considering whether such a duty exists at all, the court must consider the relevant activity of the defendant before the actual act of negligence in question, and must ask what class of persons might foreseeably be put at risk if that activity were done negligently. In the classic formulation of the duty test in Donoghue v Stevenson, Lord Atkin stated that a duty is owed to persons so closely and directly affected by the activity in question that the defendant ought reasonably to have them in contemplation as being so affected when she or he is directing her or his mind to the acts or omissions which are called in question. In the present case, the court should ‘direct its mind’ to when the detention centre imposed its prohibition on visitors, as a reasonable and appropriate response to the increased risks associated with drug use, and ask who might foreseeably be ‘closely and directly affected’ by some act of negligence by the detention centre. It could be argued that the only person who would be ‘closely and directly affected’ by negligence in the prisoner–prison relationship was the specific inmate at issue in the scenario, or perhaps another detainee. The conclusion that negligence in the jail might affect

someone such as Padgett, a foetus who happened to be 30 kilometres away, long after the escape, could only be derived using hindsight, in the light of the knowledge of what Dustin happened to do, which affected Padgett. While the reasonable detention centre may have some reason to suppose that an act of negligence in the management of the jail (to prevent violence and contraband entering it) might affect someone other than the actual detainees, this was not a case [page 326] where there was a direct relationship with members of the community, including those who had not even been conceived at the time of the detention centre’s alleged negligence (when Dustin escaped). The detention centre would acknowledge that in Chapman v Hearse, the High Court of Australia held that it is not necessary that the precise sequence of events that gave rise to the injury should be reasonably foreseeable. Therefore, Padgett need not show that each of the stages of the interaction between the detention centre and Dustin, Dustin and Meg, and Dustin and Paige, which led to Padgett being infected with HIV, was reasonably foreseeable. Padgett only needs to show that some kind of damage to the class of persons of whom she was one would be a reasonably foreseeable consequence of some act of negligence on the part of the centre. Furthermore, it is also acknowledged that the likelihood of injury does not have to be particularly high in order for it to be reasonably foreseeable. In Chapman v Hearse, the High Court expressed the test for foreseeability in terms of a risk of injury that was ‘not unlikely’. It is a low threshold, which is why it is not determinative of the duty question. Because the centre had cracked down on drugs by terminating visits, it can argue (perhaps not particularly convincingly) that what happened here (months later and so many kilometres away) was not something that someone in the centre’s position would contemplate. Therefore, with respect to the mere threshold requirement of foreseeability, the detention centre should be advised that the court may well find that Padgett was a member of the class of persons who might foreseeably be affected by its negligence. However, even if damage to someone such as Padgett was a reasonably foreseeable consequence of negligence, the centre can convincingly contend that it did not owe Padgett a duty of care that is as extensive as that advocated by her in this case. That is, the extent of the duty does not embrace the kind of situation which occurred here. Relying on Gleeson CJ’s comments in Cole v South Tweed Heads Rugby League Football Club Ltd, the detention centre would emphasise that what is at issue here is the nature and extent of the duty, not its mere existence. It is unhelpful to ask the duty question at a high level of abstraction, separating the question from concrete facts. As Gummow J highlighted in Roads and Traffic Authority of New South Wales v Dederer, duties of care are not owed in the abstract. The obligation to exercise reasonable care must be contrasted with an obligation to prevent harm occurring to others. This vexed issue also arose in Kuhl v Zurich Financial Services Australia Ltd, where French CJ and Gummow J cautioned that the duty formulation ‘must neither be so broad as to be devoid of meaningful content, nor so narrow as to obscure the issues required for consideration’.

The duty proposed by Padgett in these circumstances is too broad, open-ended and abstract. The question must be meaningful, by asking whether the detention centre owed a duty to do a particular thing, as noted by Kirby J in Neindorf v Junkovic. Using Kirby J’s approach in that case as well as that of Gleeson CJ in Cole and the recent case, Robinson Helicopter Co Inc v McDermott, where the High Court seemed to approach duty of care as a focused, specific question covering the scope of the duty as well as its existence, the centre should argue that a more specific proposition than that advocated by Padgett should be asked when formulating the duty question. The detention centre could argue that it owed no duty to protect the plaintiff from the consequences of managing the jail, including its recent efforts to crack down on drug use (and many deleterious consequences associated with its [page 327] use) by having more staff. It would argue that there is no general duty to protect all members of the public from the harm caused by an escapee, including members of the public who had not even been conceived at the time of the alleged carelessness. Aside from contesting (valiantly but likely unsuccessfully) the foreseeability part of the duty inquiry (the ‘to whom’ question) and arguing that the question asked here should be a narrow one (the scope, content or extent of the duty), the centre also should maintain that the other elements that must be satisfied to establish a duty are not present. The detention centre would highlight the fact that although reasonable foreseeability of harm must be satisfied to establish a duty, as a necessary criterion, it is not sufficient in an unusual or novel case such as that presented by the instant scenario. Something more is required. The additional requirement used to be expressed in terms of proximity, but in Hill v Van Erp a majority of the High Court of Australia expressed disapproval of the proximity test that had been applied in Australian courts for many years. Because it was said to be insufficiently precise to constitute a useful test, the concept of proximity was abandoned. In Sullivan v Moody, the court unanimously made it clear that proximity is no longer accepted as the universal criterion or touchstone necessary to establish a duty of care; a differently constituted High Court restated its criticism in Miller v Miller. Sullivan also criticised Lord Bridge’s three-stage test from Caparo Industries plc v Dickman, repeatedly advocated by Kirby J until he reluctantly relented his position (in Graham Barclay Oysters Pty Ltd v Ryan). The High Court of Australia’s reasoning in cases such as Sullivan and Perre v Apand Pty Ltd emphasises that no single, unifying, all-embracing test can be used in all types of cases to determine whether a duty of care exists. Different approaches have been used to make duty determinations. Gummow J’s approach in Perre, based on an examination of the ‘salient features’ of a case to see if a duty should be found, has been used frequently by a number of judges in significant High Court decisions and by lower courts. Here, using the High Court’s multi-factorial approach, a duty of care should not be found. There is no established category of duty of care owed by a prison (or prison authority) to prevent harm caused by an escaped prisoner beyond the immediate vicinity of a jail, and the ‘salient features’ of the circumstances do not give rise to a duty of care. The kinds of salient features that have arisen frequently in the case law were cited by

Kirby J in Harriton and noted by Allsop P in Caltex Refineries (Qld) Pty Ltd v Stavar. These include whether a duty finding would undermine other legal rules and whether a duty of care would be incompatible with another duty. The detention centre would argue that if a court held it owed a duty to a general member of the public, this would negatively affect how it and others like it manage and regulate jails, including the kinds of rehabilitation programs they offer by virtue of classification systems, and how detainees are rewarded and punished. Finding a duty would have a negative impact on all jails or detention centres, all of whom have many difficult choices to make that should not be second-guessed by the courts. A conflict could arise between the duty owed by the detention centre to its detainee and an alleged common law duty owed to a member of the public. For example, the centre may have thought it was in a detainee’s interest to be placed on a work release program, despite the fact there may indeed be potential tangential consequences to the community. This decision should not be subject to potential civil liability as it [page 328] would interfere with the jail’s management responsibilities and larger public interest objectives. It would in this way distort the penal decision-making process. Indeed, a civil claim by a member of the public could conceivably conflict with responsibilities or duties owed to the detainees themselves. It is important that coherence be maintained among the centre’s many obligations, at common law and under relevant statutes. They should not be undermined by finding a duty of care (an example of a salient feature noted by Allsop P in Stavar). In Harriton, Kirby J highlighted other salient features that often command the court’s attention when examining duty questions (as in Perre, Graham and Woolcock). These include matters such as knowledge, (special) control and vulnerability. The kind of knowledge pointing towards a duty, suggested in Perre, is absent here. So too, sufficient special control over the circumstances is not present. While it might be argued that the Daisy Bay Adult Detention Centre had knowledge of risks associated with Dustin and/or control over him, this was not, in reality, the case. This may have been true while he was in custody. But once Dustin had escaped, all control was lost, unable to be reasserted. Moreover, there was no knowledge about potential risks of harm. He could have injured anyone, anywhere, at any time (see the discussion of indeterminacy below). It is conceded that one factor that may assist Padgett is vulnerability. She, through Paige, will no doubt attempt to show that she was not in a position to protect herself (unlike the two deceased persons in CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board and Stuart v Kirkland-Veenstra). That said, Padgett was not any more vulnerable than anyone else in the community, which covered a territory at least 30 kilometres from where Dustin had been detained and was for a period of at least six months after he escaped. The class of vulnerable persons in a case like this is so large that it merges into the issue of indeterminacy (a negativing salient feature noted among others in Stavar). There would be thousands of people in this

class. Moreover, just because she was injured as a foetus does not automatically dictate a finding in her favour (as is evident in Harriton). Kirby J also noted, in Harriton, the significance of indeterminacy as a salient feature. Fears of indeterminacy (noted in Chapter 8 cases such as Perre and Woolcock Street Investments Pty Ltd v CDG Pty Ltd) is an important consideration in some kinds of cases, featuring prominently but not exclusively in those involving purely economic loss. It is of great concern here. If a duty were imposed, the detention centre’s liability would be indeterminate, as no class could be considered ascertainable: what limits could be drawn with respect to whom this duty is owed, and for how long? Would it apply to all members of the public in all potential scenarios for all time? Does it still apply, seeing that Dustin has not yet been apprehended? The duty of care that Padgett contends was owed to her would be unlimited in its scope, in terms of amount, time and class (Cardozo CJ in Ultramares Corporation v Touche). Any limits that Padgett may suggest should be and can be placed on this purported duty would be arbitrary rather than principled in nature. To sum up, the Daisy Bay Adult Detention Centre should not be held to owe Padgett a duty of care, even if injury of some kind to someone such as Padgett was held to be reasonably foreseeable. This in itself is an insufficient basis for the imposition of what would be an inordinately heavy and unwieldy burden, not just on the Daisy Bay Adult Detention Centre but on all other detention centres. As Kirby J stated in Graham Barclay [page 329] Oysters Pty Ltd v Ryan, ‘a duty of care will be imposed when it is reasonable in all the circumstances to do so’. While not a particularly comforting basis on which to decide whether a duty should or should not exist, imposing a duty here should be characterised as unreasonable, because imposing one would extend a custodial institution’s potential liability well beyond established and proper limits; it would be limitless.

Problem 2 5.33 The following scenario also concerns HIV, but in a context that is very different from the one in which Padgett found herself. Darius went to see Dr Dash, a general practitioner with a large inner-city medical practice in Aspirationville. Darius complained of a sore throat, fever and swollen glands. Dr Dash asked Darius if he was in a ‘high-risk group’. Darius replied that he was not. However, Darius did disclose that he had been involved in some intimate relationships as well as several anonymous sexual encounters during the previous six months, in which he had not used a condom. Dr Dash ordered blood and liver function tests to see if Darius had hepatitis or a urinary tract infection. Two weeks later, Dr Dash diagnosed Darius with hepatitis B. Dr Dash gave Darius a pamphlet about that disease and told

Darius to use condoms, so that his future sexual encounters were ‘safe’. Darius shrugged off this suggestion, saying he had ‘no energy for “safe sex”’. Using several popular social networking sites, including MeetaMate, InterMeet and InterAction, Darius often chatted with Paniz, a recent migrant with a young child. On their second (non-cyberspace) date, Darius disclosed his hepatitis B status to Paniz. After dating for a few weeks, Paniz and Darius began a sexual relationship, in which they eventually had unprotected sexual intercourse. Six months later, Paniz was feeling unwell. She saw her doctor, Dr Diligent, who tested Paniz for a number of illnesses. One week later, Paniz was diagnosed with HIV. The only way she could have contracted HIV was from Darius, who not only had hepatitis B, but also happened to be HIV positive. Darius did not know about his condition. Because Paniz was angry, blaming Darius for her medical condition, she did not tell Darius about her (or his) HIV status. She wanted him to ‘pay’, continuing to help her out financially for as long as he could do so. Despite observing Darius’s worsening condition over many months, Dr Dash did not test Darius for HIV, nor diagnose him with that illness. Darius passed away. Paniz has sued Dr Dash. While Dr Dash concedes that he breached his duty of care to Darius, Dr Dash denies liability to Paniz on the ground that he did not owe Paniz a duty of care. Advise Paniz and Dr Dash. Paniz’s circumstances are based upon those that arose in BT v Oei [1999] NSWSC 1082, where the court applied the reasoning in Perre v Apand Pty Ltd, the leading case on purely economic loss and duty of care: see 5.24 and 8.34. It held that the doctor did owe a duty of care to the sexual partner of a patient with HIV, even though that person was not the doctor’s patient.

[page 330]

Further discussion 1. In an article entitled ‘The Duty to Take Care’ ((1935) 51 Law Quarterly Review 637 at 639), W W Buckland described the concept of duty as ‘an unnecessary fifth wheel on the coach, incapable of sound analysis and possibly productive of injustice’. With this in mind: (a) Having read this chapter, do you agree or disagree with Buckland on this point? Note that additional duty issues are explored in later chapters.

(b) Does the concept of duty of care serve any useful purpose at all? (c) How would the tort of negligence function without it? 2. Do you agree with the High Court’s criticism in Sullivan that the Caparo approach to finding a duty of care reduces the duty determination to a discretionary judgment based upon a sense of what is fair, just and reasonable as an outcome in the particular case, rather than one based on principle? (See Caparo Industries plc v Dickman and Sullivan v Moody.) 3. Is the salient features approach to establishing a duty of care (or not) of any predictive value? 4. In New South Wales v DC [2017] HCA 22, the High Court of Australia had the opportunity to consider the scope or extent of the duty owed by the state to children who have been abused. Because of concessions that had been made by the state, the High Court of Australia unanimously revoked a grant of special leave, observing that this particular case did not provide an appropriate vehicle for it to consider these issues. In your view, with respect to the issue generally, should a duty of care be owed in a case brought by an abused child where a complaint by the child to the Department of Youth and Community Services was not reported to the police and the abuse continued? How would the reasoning employed in Sullivan v Moody, where no duty of care was owed to two fathers incorrectly suspected of abuse, apply here? Would the reasoning in Sullivan v Moody yield a similar result? 5. Do you agree with the reasoning and result in D’Orta-Ekenaike v Victoria Legal Aid, where the High Court held that an advocate (barrister or solicitor) is immune from suit for negligence in the conduct of a case, whether in court or outside, for reasons based principally on policy considerations? The High Court recently considered the limits of this immunity in Attwells v Jackson Lalic Lawyers Pty Ltd (2016) 331 ALR 1; 90 ALJR 572; [2016] HCA 16. 6. Assume Paige injected drugs using an unclean syringe, causing

Padgett, her foetus, to become HIV positive. Should Paige owe Padgett a duty of care? See 6.7; Lynch v Lynch (1991) 25 NSWLR 411; Dobson v Dobson [1999] 2 SCR 753; Bowditch (by his litigation guardian Bowditch) v McEwan (2003) 2 Qd R 615 and Bowditch (by his next friend Bowditch) v McEwan [2002] QSC 448. [page 331] 7. Do you agree with the following statement by Hon A Linden (‘The Good Neighbour Principle on Trial: A Fountain of Sparkling Wisdom’ (1983) 17 University of British Columbia Law Review 67 at 67)? As Donoghue v Stevenson celebrates its 50th anniversary, it is not only alive and well, it is thriving, vigorous, lusty, youthful and energetic. For me, it is still and will remain like a seed of an oak tree, a source of inspiration, a beacon of hope, a fountain of sparkling wisdom, a skyrocket bursting in the midnight sky.

Further reading Ashley D, ‘The Injured Plaintiff: Contemporary Canterbury Tales’ (2013) 87 Australian Law Journal 605. Balkin R P and Davis J L R, ‘Duty of Care’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 7. Barker K, Cane P, Lunney M and Trindade F, ‘Negligence and the Scope of the Obligation to Take Care: Duty of Care’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 9. Chan L, ‘The Penumbral Duty of Care — Is a Principled Approach Possible?’ (2013) 21 Torts Law Journal 106. Gillooly L, ‘Legal Coherence in the High Court: String Theory for Lawyers’ (2013) 87 Australian Law Journal 33.

Gray A, ‘Liability of Police in Negligence: A Comparative Analysis’ (2016) 24 Tort Law Review 34. Ipp D, ‘The Reach of the Dederer Principle’ (2010) 18 Torts Law Journal 125. Linden A, ‘The Good Neighbour on Trial: A Fountain of Sparkling Wisdom’ (1983) 17 University of British Columbia Law Review 67. Luntz H, ‘The Use of Policy in Negligence Cases in the High Court of Australia’ in M Bryan (ed), Private Law in Theory and Practice, Routledge-Cavendish, London and New York, 2007, p 55. Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Negligence: Duty of Care’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 2. Malkin I and Voon T, ‘Social Hosts’ Responsibility for their Intoxicated Guests: Where Courts Fear to Tread’ (2007) 15 Torts Law Journal 62. Nolan D, ‘Deconstructing the Duty of Care’ (2013) 129 Law Quarterly Review 559. Orr G and Dale G, ‘Impaired Judgments? Alcohol Server Liability and “Personal Responsibility” after Cole v South Tweed Heads Rugby League Football Club Ltd’ (2005) 13 Torts Law Journal 103. Purshouse C, ‘Arrested Development: Police Negligence and the Caparo “Test” for Duty of Care’ (2016) 23 Torts Law Journal 1. [page 332] Robertson A, ‘Justice, Community Welfare and the Duty of Care’ (2011) 127 Law Quarterly Review 370. Witting C, ‘Duty of Care: An Analytical Approach’ (2005) 25 Oxford Journal of Legal Studies 33. —, ‘The Three Stage Test Abandoned in Australia — Or Not?’ (2002) 118 Law Quarterly Review 214.

—, ‘Tort Law, Policy and the High Court of Australia’ (2007) 31 Melbourne University Law Review 23.

1

(1934) 34 Columbia Law Review 41 at 56.

[page 333]

6 ‘Affirmative Action’: The Duty to Act Objectives After completing this chapter, you should: — understand why the common law imposes no general duty to act for the safety of others; — understand the difference between misfeasance and nonfeasance; — have a working knowledge of what types of relationship give rise to a duty to act for another’s safety; — have a working knowledge of what types of relationship give rise to a duty to act to protect another from harm caused by a third person.

Key cases — CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board (2009) 239 CLR 390; 260 ALR 606 — Dorset Yacht Co Ltd v Home Office [1970] AC 1004 — English v Rogers (2005) Aust Torts Reports ¶81-800; [2005] NSWCA

327 — Geyer v Downs (1977) 138 CLR 91; 17 ALR 408 — Lowns v Woods (1996) Aust Torts Reports ¶81-376 — Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; 176 ALR 411 — New South Wales v Bujdoso (2005) 227 CLR 1; 222 ALR 663 — Richards v Victoria [1969] VR 136 — Smith v Leurs (1945) 70 CLR 256 — Smith v Littlewoods Organisation Ltd [1987] AC 241 — Stuart v Kirkland-Veenstra (2009) 237 CLR 215; 254 ALR 432 [page 334]

Introduction 6.1 There is no general legal duty to take positive steps for the safety of others. If I am walking along the beach and see someone drowning in the water, I owe that person no legal duty to attempt a rescue, even if I am a strong swimmer and could easily save her or him. I deserve moral condemnation if I walk on and let the person drown, but my acts will not attract legal liability, as I owe no legal duty to act. 6.2 Some omissions do give rise to liability in negligence. For example, if I fail to take reasonable precautions against a reasonably foreseeable risk, that omission gives rise to legal liability. The distinction between that omission and my omission to dive into the water to save the drowning person is expressed in legal terms as the distinction between misfeasance (‘bad doing’) and nonfeasance (‘nondoing’). To put it another way, there is a legal distinction between acting with care and performing acts of care. For example, while I am

driving my car, I owe a duty to other road users to drive carefully. I must not drive too quickly, I must keep a proper lookout, and I must give way at intersections, and so on. In acting in this way, I am not doing two things — driving and taking care — but one thing — driving carefully. If I fail to take any of the precautions that the law requires of me, that omission means that I have done that one thing carelessly. My omission constitutes misfeasance, and it attracts legal liability. In contrast, if I do not dive into the water to save the drowning person, I have not done something badly; I have simply done nothing, rather than something. That omission constitutes nonfeasance, and it does not attract legal liability. 6.3 There are, in general, two kinds of case where the law imposes a duty to act, and where nonfeasance gives rise to legal liability. These are: 1. where there is a special relationship between the plaintiff and the defendant such that the defendant is required to take positive action for the plaintiff’s safety; 2. where there is a special relationship between the defendant and a third party such that the defendant is required to take positive action to ensure that the third party does not cause damage to others. A duty to control may also arise in the absence of a special relationship, if the circumstances require intervention on the part of the defendant.

Where There is a Special Relationship Between Plaintiff and Defendant 6.4 In some cases, the relationship between the plaintiff and the defendant is such that an exception is made to the general rule that there is no liability for nonfeasance. A typical example of such a relationship is that between a teacher or a school and the children in the school. The relationship is such that the school is required to take positive steps for the safety of the pupil, including steps to ensure that the pupil is not injured by third parties (such as other pupils).

[page 335] Key Case Richards v Victoria [1969] VR 136 Facts: The plaintiff, a schoolboy aged 16, received serious injuries in a fight with another schoolboy during class. There was a teacher present at the time of the fight, but he took no steps to stop the fight. The plaintiff sued the teacher’s employer. The evidence established that the teacher had failed to maintain discipline in the class for some months preceding the dispute. Issue: Did the teacher owe a duty to take steps to protect the plaintiff? Decision: On appeal from a first instance decision in favour of the plaintiff, the Full Court of the Supreme Court of Victoria held that the teacher should have taken steps to stop the fight, so the defendant was liable. Winneke CJ (with whom Adam and Little JJ agreed) said (at 138–41): We are of opinion that it is now clearly established by authority that in general a schoolmaster owes to each of his pupils whilst under his control and supervision a duty to take reasonable care for the safety of the pupil. It is not, of course, a duty of insurance against harm, but a duty to take reasonable care to avoid harm being suffered. … As the duty is one to take reasonable care, foreseeability of harm arising from particular conduct is of course relevant to the question whether there has been a breach of the duty, but it is not, in our opinion, relevant to the existence of the duty itself which arises from the relationship of schoolmaster and pupil.

6.5 Richards’ case, and Winneke CJ’s dictum, were expressly approved by the High Court of Australia in Victoria v Bryar [1970] ALR 809; (1970) 44 ALJR 174, where the plaintiff, a schoolboy, was injured in ‘a concentrated exchange of paper pellets’ in class, which the teacher had failed to prevent. The plaintiff’s action against the teacher’s employer succeeded. In Cox v New South Wales (2007) Aust Torts Reports ¶81-888 at 69,523; [2007] NSWSC 471 at [72] (for the facts, see 4.17) Simpson J said that the existence of a duty owed by a school to protect its pupils from being harmed by other pupils ‘is not controversial’ and ‘cannot be seriously doubted’. 6.6

Richards’ case and Bryar’s case (see

6.4–6.5)

establish that the

school’s duty to take positive steps for its pupils’ safety arises simply from the relationship of teacher and pupil. The next cases are concerned with when that relationship begins and ends. Key Case Geyer v Downs (1977) 138 CLR 91; 17 ALR 408 Facts: The plaintiff, an eight-year-old girl, was severely injured by another schoolgirl while playing in an unsupervised playground before school. The school gates were opened about three-quarters of an hour to an hour before supervision began. Supervision began half an hour before classes began. There were usually about 100 to 150 girls in the playground half an hour before supervision began. The plaintiff [page 336] sued the employer of the school principal, alleging that her injuries had been caused by his failure to take reasonable steps to ensure her safety. Issue: Did the school principal’s duty to take reasonable care for the pupil’s safety exist before school began? Decision: The High Court of Australia held unanimously that the principal’s duty to ensure that the playground was adequately supervised arose when the school gates were opened, even though that was outside official school hours. It was held that, on the balance of probabilities, adequate supervision would have prevented the plaintiff’s injury. Thus, as her injury was caused by the principal’s breach of duty, her action succeeded.

Case Example Trustees of the Roman Catholic Church for the Diocese of Bathurst v Koffman (1996) Aust Torts Reports ¶81-399 Facts: The plaintiff, a 12-year-old boy, was injured by pupils from a neighbouring school while he was waiting to catch the bus home after school at a distance of 300–400 metres from his own school. He sued the authority responsible for running his own school, alleging that his injuries were caused by its failure to provide reasonably adequate supervision at the bus stop. Issue: Did the school’s duty to take reasonable care for the pupil’s safety exist after school had finished?

Decision: By a majority of two to one, the Court of Appeal of New South Wales held that the defendant was liable, even though the incident had occurred after school hours and outside school grounds. Sheller JA (with whom Priestley JA agreed) said (at 63,597): I do not think the relationship of teacher and pupil begins each day when the pupil enters the school ground and terminates when the pupil leaves the school ground. … [T]he extent and nature of the duty of the teacher to the pupil is dictated by the particular circumstances. I do not think its extent is necessarily measured or limited by the circumstance that the final bell for the day has rung and the pupil has walked out the school gate. The High Court of Australia later refused the school special leave to appeal against the decision of the Court of Appeal of New South Wales, saying that the majority judgments ‘contained no error of principle’: see (1997) 143 ALR 49–50 (SL).

Case Example Graham v New South Wales (2001) 34 MVR 198 Facts: A pupil with bad eyesight and impaired balance was injured while walking unassisted across a busy road on the way home from school. She sued the state of New South Wales, the school authority. [page 337] Issue: Did the school’s duty to take reasonable care for the pupil’s safety exist after school had finished? Decision: The Court of Appeal of New South Wales distinguished Koffman and held that the school owed no duty to the child to ensure that she went home in a bus or a taxi. Meagher JA (with whom Mason P and Giles JA agreed) said (at [5]): No doubt the school had a duty to take reasonable steps to protect the child whilst it was at school, and this it apparently did. There may also have been a duty to inform [the plaintiff’s] parents that neither taxi nor bus was running, and this it certainly did. There is no duty, in my opinion, to go further to take precautions to escort a pupil like [the plaintiff] to her home. Except in exceptional circumstances the master/pupil relationship ceases to exist at the school boundary.

In Uniting Church in Australia Property Trust (NSW) v Miller (2015) 91

NSWLR 752, a school accepted, on the basis of Geyer and Koffman, that it owed a duty of care to one of its pupils, despite the fact that the pupil was injured outside term time and away from school premises, and the New South Wales Court of Appeal said that that admission had been ‘properly’ made: at [158] per Leeming JA. 6.7 Parents (and sometimes other relatives) are in a relationship of ‘care and control’ with their children at most times. In Robertson v Swincer (1989) 52 SASR 356, the Full Court of the Supreme Court of South Australia held that the relationship of parent and child does not, in itself, give rise to a duty in the parent to take positive steps to protect the child from harm. The court held that a duty arises only if the parent’s actions create the risk of injury to the child. Barwick CJ had taken a similar view in Hahn v Conley (1971) 126 CLR 276; [1972] ALR 247, but it is questionable whether the decision in Robertson is consistent with the views expressed by the other judges in Hahn’s case or the views expressed by the High Court in Bryar and Geyer: discussed at 6.5–6.6. The judges in Robertson’s case justified the distinction between teachers (who owe a duty) and parents (who do not) on the basis that schools can and do insure against liability, whereas parents cannot and do not: see 52 SASR at 361 per King CJ. Note that there is no doubt that a parent owes a duty to her or his child under ordinary principles if her or his actions create the risk of injury. A striking example of that can be seen in Lynch v Lynch (1991) 25 NSWLR 411 and Bowditch v McEwan [2003] 2 Qd R 615, where the Court of Appeal of New South Wales and the Court of Appeal of Queensland, respectively, held that a mother owes a duty to her unborn child to drive carefully while pregnant. Lynch and Bowditch are concerned with the situation where the mother creates the risk of harm herself; Robertson and Hahn are concerned with the question of whether a parent owes a duty to protect the child from harm arising from other sources. Although the court may be more willing to find a duty when the parent creates the risk, it does not follow that creation of the risk is determinative of the existence of a duty, so that there can be no duty if the parent did not

create the risk. In the next case, the court disagreed (obiter) with Robertson that there can only be a duty when the parent creates the risk. [page 338] Case Example St Mark’s Orthodox Coptic College v Abraham [2007] NSWCA 185 Facts: The plaintiff suffered significant injuries when he fell from a balustrade on the second floor of his school, which was run by the defendant. In proceedings brought by the plaintiff’s mother on his behalf, the Supreme Court of New South Wales held that the defendant school was liable in negligence to the plaintiff: see Abraham Bht Abraham v St Mark’s Orthodox Coptic College [2006] NSWSC 1107. The school cross-claimed against the plaintiff’s father for a contribution to the damages payable to the plaintiff, arguing that the father had been negligent in leaving his son at school before formal supervision of the school premises had begun. The trial judge dismissed the cross-claim on the ground that the father owed his son no duty of care and, if he did, he had not breached that duty. The school appealed. Issue: Did the father owe his son a duty not to leave him at school before supervision began? Decision: The Court of Appeal of New South Wales held that the father owed, but had not breached, a duty of care to his son in the circumstances. Ipp JA (with whom Basten JA and Young CJ in Eq agreed) said (at [31]–[33]): In my opinion, the ratio of Hahn v Conley was that, while the mere existence of a parent/child relationship does not bring about a duty of care on the part of a parent towards a child, the circumstances of a particular situation may give rise to such a duty. As Kirby J said in Harriton v Stephens (2006) 226 CLR 52 at [129], citing Hahn v Conley, ‘Australian law does not recognise any principle of parental immunity in tort’. It has been said that in Hahn v Conley, Barwick CJ drew a distinction between omissions and commissions … There are echoes of this notion in Robertson v Swincer … (at 359–60 per King CJ). In my view, however, when regard is had to the judgments of all the members of the High Court in Hahn v Conley, such a proposition is not part of the ratio of the Court. I would add that the modern approach to the law of negligence does not favour liability being dependent upon categories of ‘misfeasance and nonfeasance’: Brodie v Singleton City Council (2001) 206 CLR 512 (at 551–4 per Gaudron, McHugh and Gummow JJ). In any event, in this case, Mr Abraham did perform a positive act, namely, he took

Christopher to school and dropped him off there at a time when, to Mr Abraham’s knowledge, the supervision at the College was inadequate. The Court of Appeal of New South Wales went on to hold that the plaintiff’s father had not breached the duty of care he owed, because he had not acted unreasonably in the circumstances: see 3.48.

The question of whether a parent or other relative owes a legal duty of care to a child remains controversial. In Hoffmann v Boland (by her tutor Boland) [2013] NSWCA 158, the New South Wales Court of Appeal held unanimously that a grandmother was not liable for injuries incurred by her infant granddaughter when the grandmother fell downstairs while holding the child. However, the three appeal judges disagreed on the reasons for coming to that conclusion. Sackville AJA held that the grandmother owed a duty of care but had not breached that [page 339] duty; Basten JA held that the grandmother owed no duty of care; and Barrett JA found it unnecessary to state any conclusion about whether the grandmother owed a duty of care, given that the duty, if owed, would not have been breached in the circumstances. 6.8 Another example of a relationship that gives rise to a duty on the defendant to take positive steps for the plaintiff’s safety is that between prison authority and prisoner. As in the case of teacher and pupil, the duty simply arises out of the relationship of jailer and prisoner. In Howard v Jarvis (1958) 98 CLR 177 at 183, Dixon CJ, Fullagar and Taylor JJ said: We feel no doubt that … Howard [the jailer] was subject to a duty at common law to exercise reasonable care for the safety of Jarvis [the prisoner] during his detention in custody. He had deprived Jarvis of his personal liberty, and assumed control of his person. In arresting and detaining Jarvis he was no doubt acting lawfully and properly and in the due execution of his duty, but he was depriving Jarvis of his liberty and he was assuming control for the time being of his person, and it

necessarily followed, in our opinion, that he came under a duty to exercise reasonable care for the safety of his person during the detention. [Original emphasis.]

6.9 In the next case, the High Court of Australia considered the extent of the duty owed by jailer to prisoner. For a consideration of the breach issues in this case, see 3.49. Key Case New South Wales v Bujdoso (2005) 227 CLR 1; 222 ALR 663 Facts: The plaintiff was badly beaten by fellow inmates at a prison where he was serving a sentence for sexually assaulting children. He sued the state of New South Wales, alleging that it had failed to take reasonable care for his safety by putting him in a low security unit at the prison when he was a likely target of attacks by other prisoners, given the nature of the offences for which he had been imprisoned. Issue: Did the state’s duty to take reasonable steps for the prisoner’s safety require it to treat the plaintiff differently from other prisoners? Decision: The High Court of Australia held that the defendant had breached the duty it owed the plaintiff. Gleeson CJ, Gummow, Kirby, Hayne, Callinan and Heydon JJ said (at [44]): It is true that a prison authority, as with any other authority, is under no greater duty than to take reasonable care. But the content of the duty in relation to a prison and its inmates is obviously different from what it is in the general lawabiding community. A prison may immediately be contrasted with, for example, a shopping centre to which people lawfully resort, and at which they generally lawfully conduct themselves. In a prison, the prison authority is charged with the custody and care of persons involuntarily held there. Violence is, to a lesser or a greater degree, often on the cards. No one except the authority can protect a target from the violence of other inmates. [page 340] Many of the people in prisons are there precisely because they present a danger, often a physical danger, to the community. It is also notorious that without close supervision some of the prisoners would do grave physical injury to other prisoners. The [plaintiff] here did not simply rely upon the notorious fact that prisoners convicted of sexual offences against minors are at greater risk than other offenders: he proved that the [defendant] knew that he had been threatened and taunted by other prisoners, on that account, albeit to a somewhat lesser extent at Silverwater Prison than he might have been in the other institutions in which he had been imprisoned.

Note: In Bujdoso v New South Wales (2007) 69 NSWLR 302; Aust Torts Reports ¶81876, the Court of Appeal of New South Wales later held that the limits on recoverable damages imposed by the Civil Liability Act 2002 (NSW) (see Chapter 12) applied to the plaintiff’s action, but that special provisions governing damages payable to ‘offenders in custody’, which would have required the state to pay the damages into a trust fund for the victims of the plaintiff’s crimes, rather than to the plaintiff himself, did not. See also 3.49.

6.10 Cases like Howard and Bujdoso are concerned with the jailer’s duty to take steps to keep the prisoner in custody safely. Different issues arise when the prisoner complains not of a failure in the state’s duty of custody, but its failure in another capacity. For example, in Cran v New South Wales (2004) 62 NSWLR 95, the plaintiff was held in custody for over nine weeks pending the return of a laboratory analysis, which eventually cleared him. The police had not told the laboratory that the analysis related to a trial, nor that it related to someone being held in custody. Despite this ‘sequence of uncaring neglect’ (at [13] per Santow JA), and despite the fact that the plaintiff ‘was totally dependent on the State, in the form of the police and DPP [Director of Public Prosecutions]’ (at [29] per Santow JA) to get the analysis done promptly, the New South Wales Court of Appeal held that the state was not liable to the plaintiff for the chronic posttraumatic stress disorder that he had suffered as a result of what he had witnessed while being held in jail. Santow JA said: ‘Clearly neither police nor the DPP had custody of [the plaintiff]; they were in no sense the custodial authority’ (at [34]). Their failure lay in the speed with which they had prosecuted the case against the plaintiff while he was being held in custody. Santow JA expressed the court’s conclusion as follows (at [63]): Regrettably for the [plaintiff] in the unfortunate circumstances that were inflicted upon him, I consider that on present authority, the greater public interest accorded unimpeded investigation by the police and, so far as relevant, the DPP in carrying out its prosecutorial function, precludes any duty of care to the [plaintiff]. The current state of the law, and the policy which underlies it, gives paramount weight to those considerations even overriding the factors of vulnerability and entire dependency. This is so though the decision is itself ministerial … [T]here is no bright line between the functions of disclosure and investigation, or between administrative and investigative tasks. Their efficient performance may be put at risk by the very

prospect of civil action designed to provide sanctions against inefficiency; that, any rate, is the policy consideration reinforcing the immunity.

[page 341] 6.11 The relationship of employer and employee is another of the ‘special relationships’ that gives rise to a duty of affirmative action. The employer owes a duty to take reasonable steps to protect the employee from harm caused by others. As the following cases show, the duty may also arise in relationships that are almost like that of employer and employee. Key Case English v Rogers (2005) Aust Torts Reports ¶81-800; [2005] NSWCA 327 Facts: The plaintiff was a cleaner employed by the second defendant, which had a contract with a hotel owned by the first defendant. The plaintiff suffered psychological trauma after being held hostage for several hours by a masked gunman in the early hours of the morning. The plaintiff sued both defendants. The second defendant claimed a contribution from the first defendant. The trial judge awarded the plaintiff damages in the action against the second defendant but dismissed his action against the first defendant. The dismissal of the plaintiff’s action against the first defendant necessarily led to dismissal of the second defendant’s action for a contribution from the first defendant. (As we will see in Chapter 14, a person can only be held liable to make a contribution if she or he would have been liable to the plaintiff.) The second defendant appealed the dismissal of its contribution action against the first defendant and the plaintiff cross-appealed the dismissal of his action against the first defendant. Thus, both the second defendant and the plaintiff were arguing that the first defendant owed the plaintiff a duty to take reasonable steps to protect him from assailants. Issue: Did the first defendant (the owner of the hotel) owe the plaintiff a duty to take reasonable care for his safety, even though the first defendant was not the plaintiff’s employer? Decision: The New South Wales Court of Appeal held that the first defendant owed the plaintiff a duty. The first defendant’s status as occupier of the premises was not enough to give rise to a duty (following Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; 176 ALR 411, which is considered at 6.22), but, as Mason P (with whom Santow JA and Brownie AJA agreed) observed (at [87]):

The relationship between the Hotel and the cleaners was, in my view, so closely analogous to that of an employer, at least as regards safety in the workplace, as to generate a duty of care that was not trumped by glib citation of Modbury. Note: In both Coca Cola Amatil (NSW) Pty Ltd v Pareezer (2006) Aust Torts Reports ¶81-834; [2006] NSWCA 45 and TAB Ltd v Beaman [2006] NSWCA 345, the New South Wales Court of Appeal followed English v Rogers in holding that there is a duty to protect against violence in the workplace ‘where the injured person is not, strictly speaking, an employee, but is so under the control of another person that they take up a relationship that is extremely close to that of employer and employee’: Pareezer at [71] per Young CJ in Eq. However, in both cases, the New South Wales Court of Appeal held on the facts that the plaintiff had failed to establish a causal link, because the injuries would probably have been suffered even if the almost[page 342] employer had taken reasonable precautions to protect the plaintiff from assailants. In contrast, in Karatjas v Deakin University (2012) 35 VR 355, the Victorian Court of Appeal held that Deakin University did not have sufficient control over the workplace in its cafeteria, which was operated by an independent contractor, to owe a duty to an employee of that contractor who was attacked on campus.

6.12 In the next case, the court took the bold step of adding a new category of relationship to those that give rise to a duty to take positive action. Key Case Lowns v Woods (1996) Aust Torts Reports ¶81-376 Facts: The plaintiff, a small child, suffered a prolonged epileptic fit at home. His mother sent his sister to fetch a doctor. The sister went to the defendant doctor’s surgery and asked him whether he would come to attend to her brother. The plaintiff was not and never had been the defendant’s patient. The defendant refused to go to the plaintiff’s aid. The plaintiff suffered brain damage as a result of the fit, and sued the defendant (among others). Issue: Did the defendant owe a duty to go to the plaintiff’s aid, even though the plaintiff was not the defendant’s patient? Decision: By a majority of two to one, the Court of Appeal of New South Wales held that the defendant owed the plaintiff a duty to take positive steps for his safety, even though there was no existing doctor–patient relationship between them. Cole JA (with whom Kirby P agreed) said (at 63,176):

Dr Lowns accepted that injury (‘damage’) to a fitting child was foreseeable if he, once requested, did not attend to treat the child. There was an obvious physical proximity, for Joanna [the sister] had come on foot. There also existed ‘circumstantial proximity’ in the sense that Dr Lowns was an adequate medical practitioner to whom a direct request for assistance was made where, on the evidence presented, there was no reasonable impediment or circumstance diminishing his capacity or indicating significant or material inconvenience or difficulty in him responding to the request, in circumstances where he knew … that serious harm could occur to [the plaintiff] if he did not respond to the request and provide treatment. Once it is found, as here, that administering valium at the time determined by the trial judge would have brought an end to the status epilepticus before the onset of brain damage causing quadriplegia, causal proximity is also established.

6.13 At this point, it should be remembered that since Lowns was decided in 1996, the High Court of Australia has declared that it will no longer use ‘proximity’ as a general test for the existence of a duty of care in the way that Cole JA did in Lowns: see 5.21–5.22. Nevertheless, Lowns was applied in BT v Oei [1999] NSWSC 1082 to hold that a general practitioner owes a duty to warn the sexual partner of a patient with HIV, even though that person is not a patient of the doctor, and also [page 343] in Alexander v Heise [2001] NSWSC 69 to hold that a general practitioner owes a duty of care to a prospective patient who contacts her or his office by telephone. 6.14 In the cases we have considered so far, the plaintiffs have been in some way forced to be dependent on someone else for their safety. In the next two cases, the High Court of Australia stressed the importance of the plaintiff’s autonomy. Lack of autonomy helps to explain the existence of a duty to act. The schoolchild is subject to the school’s discipline and authority; the prisoner is subject to the jailer’s discipline and authority; the employee must function within a workplace set up and controlled by the employer. The next two cases

show that if the plaintiff is free to protect herself or himself, there is no duty upon others to take action, even if they could. That is the rather brutal explanation of why I owe no duty to save the drowning swimmer. Key Case CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board (2009) 239 CLR 390; 260 ALR 606 Facts: The plaintiff’s husband was drinking at the defendant’s hotel. He agreed that the motorcycle that he had been riding should be locked in a storeroom at the hotel. He gave the keys to the licensee, with the understanding that the plaintiff would collect him later. After drinking for a few hours, the plaintiff’s husband was refused service. The licensee asked for the plaintiff’s telephone number so that he could call her to collect her husband. The plaintiff’s husband aggressively refused to give the number and demanded the return of the motorcycle and keys. The licensee resisted but the plaintiff’s husband insisted. Eventually, the licensee handed over the keys and the plaintiff’s husband rode away. A short distance from home he drove off the road and was killed. His blood alcohol reading was 0.253. The plaintiff sued the defendant, alleging that her husband’s death was caused by the negligence of the licensee in returning the motorcycle to her husband. Issue: Did the defendant owe a duty to the plaintiff’s husband to refuse to return the motorcycle? Decision: The High Court of Australia held that the defendant did not owe a duty to the plaintiff’s husband to protect him against the risks of riding the motorcycle. Gummow, Heydon and Crennan JJ (with whom French CJ and Hayne J agreed) said (at [38]): [T]he duty conflicts with Mr Scott’s autonomy. The duty on the licensee would have prevented Mr Scott from acting in accordance with his desire to ride his wife’s motorcycle home. This conflict does not arise where for some supervening or overriding reason a person who is owed the putative duty is not autonomous, or fully autonomous — because, for example, some control must be exercised by the defendant over another person who either was vulnerable before the control was first exercised, or has become vulnerable by reason of the control having begun to be exercised. That is so for pupils in relation to their teachers, wards in relation to their guardians, prisoners in relation to the risk of fire caused by the negligence of gaolers, prisoners in relation [page 344] to the risk of harm from other prisoners not properly restrained by gaolers, patients in relation to hospitals, crowds in relation to those charged with the duty to control them, and employees in relation to their employers. But the relationship

between Mr Scott, on the one hand, and the proprietor and the licensee, on the other, did not impair Mr Scott’s autonomy … The court also pointed out that, in the circumstances of this case, imposing a duty on the defendant to protect the plaintiff’s husband would not be coherent with other torts and the law of bailment. Keeping the plaintiff’s motorcycle when her husband had demanded its return would constitute a tort: see Chapter 18. In relation to the duties owed by licensees more generally, Gummow, Heydon and Crennan JJ said (at [52]–[53]): [O]utside exceptional cases, which this case is not, persons in the position of the proprietor and the licensee, while bound by important statutory duties in relation to the service of alcohol and the conduct of the premises in which it is served, owe no general duty of care at common law to customers which requires them to monitor and minimise the service of alcohol or to protect customers from the consequences of the alcohol they choose to consume. That conclusion is correct because the opposite view would create enormous difficulties, apart from those discussed above, relating to customer autonomy and coherence with legal norms. … Expressions like ‘intoxication’, ‘inebriation’ and ‘drunkenness’ are difficult both to define and to apply. The fact that legislation compels publicans not to serve customers who are apparently drunk does not make the introduction of a civil duty of care defined by reference to those expressions any more workable or attractive.

Key Case Stuart v Kirkland-Veenstra (2009) 237 CLR 215; 254 ALR 432 Facts: Two Victorian police officers saw a man sitting alone in a car in a secluded parking area. A hose ran from the exhaust pipe to the inside of the car but the engine was not running. The police officers questioned the man for about 15 minutes. He told them he had thought of committing suicide but had changed his mind. He appeared calm and rational. The police officers allowed him to leave. Later that day, he committed suicide. The man’s wife, the plaintiff, sued the police officers and the state of Victoria for the police officers’ failure to exercise the power they had under the Mental Health Act 1986 (Vic) s 10, to apprehend a person who appeared mentally ill if there were reasonable grounds for supposing that person was likely to commit suicide. Issue: Did the police officers owe the plaintiff a duty to prevent her husband from committing suicide? Decision: The High Court of Australia held that the police officers did not owe a duty to prevent the plaintiff from harming himself. Gummow, Hayne and Heydon JJ said (at [87]–[88]):

The duty which the plaintiff alleged the police officers owed her late husband was a duty to control his actions, not in this case to prevent harm to a stranger, but to [page 345] prevent him harming himself. On its face, the proposed duty would mark a significant departure from an underlying value of the common law which gives primacy to personal autonomy, for its performance would have the officers control conduct of Mr Veenstra deliberately directed at himself. Personal autonomy is a value that informs much of the common law. It is a value that is reflected in the law of negligence. The co-existence of a knowledge of a risk of harm and power to avert or minimise that harm does not, without more, give rise to a duty of care at common law. … [T]here is no general duty to rescue. In this respect, the common law differs sharply from civil law. The common law has been described as ‘individualistic’, the civil law as ‘more socially impregnated’. The fact that the plaintiff was arguing for a common law duty to exercise a statutory power raises special issues that are considered in Chapter 7. For the moment, it is sufficient to quote again from Gummow, Hayne and Heydon JJ (at [99]): The duty which is postulated in the present case is expressed in terms which, on their face, would require every person who knows (perhaps every person who ought to know) that another is threatening self-harm to take reasonable steps to prevent that harm. Presumably, performance of a duty described in those terms would require the person, in an appropriate case, to exercise the power given by s 463B of the Victorian Crimes Act (or equivalent provisions) and use reasonable force to prevent the commission of suicide or ‘of any act which he believes on reasonable grounds would, if committed, amount to suicide’. Presumably it is a duty which would require the person to call for police so that they could exercise powers under s 10. And all this regardless of whether the person threatening selfharm is in fact mentally ill, or appears to be so. So expressed the duty would be a particular species of a general duty to rescue. The common law of Australia has not recognised, and should not now recognise, such a general duty of care.

6.15 When one person voluntarily takes possession of goods that belong to another, she or he owes the owner a duty to take reasonable care of the goods, which includes a duty to take positive action for their safety where necessary: see, for example, Pitt Son & Badgery Ltd v Proulefco SA (1984) 153 CLR 644; 52 ALR 389; Brambles Security Services Ltd v Bi-Lo Pty Ltd (1992) Aust Torts Reports ¶81-161. Although the content of the duty is very like that owed under the principles described in this section, the duty arises under the law of

bailment rather than the law of torts. Bailment is an area of the law separate from tort and contract, but with similarities to each. It is discussed in more detail in Chapter 18. In CAL (No 14) Pty Ltd (see 6.14), Gummow, Heydon and Crennan JJ pointed out that the law of bailment would have required the defendant to return the plaintiff’s motorcycle.

Duty to Prevent Another from Causing Damage or Loss to the Plaintiff 6.16 There is, in general, no duty on one person to control the actions of another to prevent her or him from causing injury to other people. There may, however, be cases where the relationship between the defendant and another person is such that the defendant owes a duty to control that person’s actions, as the next case shows. [page 346] Key Case Smith v Leurs (1945) 70 CLR 256 Facts: The defendants were the parents of a 13-year-old boy who, while playing, fired a stone from a shanghai (slingshot), which hit the plaintiff in the eye, seriously damaging his sight. The plaintiff sued the boy’s parents, alleging that they had negligently failed to control their son, in allowing him to have and to use the shanghai. Issue: Did the parents owe the plaintiff a duty to control their son’s actions? Decision: The High Court of Australia held that the defendants did owe the plaintiff a duty to control their son, but they had not breached it in the circumstances of the case. Dixon J said (at 262): It is … exceptional to find in the law a duty to control another’s actions to prevent harm to strangers. The general rule is that one man is under no duty of controlling another man to prevent his doing damage to a third. There are, however, special relations which are the source of a duty of this nature. It appears now to be recognised that it is incumbent upon a parent who maintains control over a young child to take reasonable care so to exercise that control as to avoid

conduct on his part exposing the person or property of others to unreasonable danger. As the parents had told their son not to use the shanghai outside the family home, the court held that they had not breached their duty to the plaintiff because they had taken reasonable steps to control their son’s use of the shanghai.

6.17 There is some circularity in the proposition that a person owes a duty to control those who are under her or his care and control. Although that general proposition does little to identify which kinds of relationship will give rise to a duty of control, it does give some indication of the essential quality of the relationship between the defendant and the third party that gives rise to a duty of care. That quality, ‘care and control’, is the same quality that gives rise to a duty to take positive steps for the safety of another. Thus, if X and Y are in such a relationship that X owes Y a duty to take positive steps for her or his safety, X may also owe a duty to take reasonable precautions to prevent Y from injuring others. For example, in both Richards’ case and Bryar’s case (see 6.4–6.5), the plaintiff school pupil was injured by the actions of another pupil. The duty owed by the school to the injured pupil arose both because of the relationship of care and control between the school and the injured pupil, and also because of the relationship of care and control between the school and the injuring pupil, which gave rise to a duty to control that pupil’s actions. 6.18 In cases such as these, the special relationship between the defendant and the person who causes damage or injury is a prerequisite for the existence of a duty of care. Strictly speaking, though, the relationship that gives rise to the duty of care is that between the defendant and the plaintiff. The first of the next two cases may give the impression that the defendant owes a duty of care to all those whom it is reasonably foreseeable may suffer injury or damage if she or he fails to [page 347]

take reasonable care to control the third party with whom she or he has the special relationship. The second case emphasises, consistently with the more modern principles we saw in Chapter 5, that foreseeability of harm is not enough in itself to give rise to a duty to control. The ability to control the acts of the third party is the important factor in identifying to whom the duty is owed, despite the circularity of reasoning noted above: see 6.17. Key Case Dorset Yacht Co Ltd v Home Office [1970] AC 1004 Facts: Seven boys from a reform school, who were working on an island under the control and supervision of three prison officers, escaped from the island at night and boarded a yacht owned by the plaintiffs. The boys cast the yacht adrift and caused it damage. The owners of the yacht sued the prison authority, alleging that the damage to the yacht had been caused by the prison officers’ negligence in allowing the boys to escape. The defendant raised the preliminary issue of whether it owed the plaintiffs any duty of care in the circumstances. Issue: Did the prison authority owe a duty to the plaintiff to control the actions of the boys? Decision: The House of Lords resolved the preliminary issue by holding that the defendant did owe the plaintiffs a duty of care in the circumstances. The relationship between the prison officers and the boys imposed on the former a duty to control the latter; that duty was owed to all those whom it was reasonably foreseeable might suffer injury or damage if the boys were allowed to escape. As the plaintiff was a member of that class, a duty was owed to the plaintiff. After quoting Dixon J’s dictum from Smith v Leurs about ‘special relations’ giving rise to a duty to control (see 6.16), Lord Morris of Borth-y-Gest said (at 1038–9): In the present case there was, I think, a special relation of this nature. There was a special relation in that the officers were entitled to exercise control over boys who to the knowledge of the officers might wish to take their departure and who might well do some damage to property near at hand. The events which are said to have happened could reasonably have been foreseen. The possibility that the property of the company might be damaged was not a remote one. A duty arose. It was a duty owed to the company. It was not a duty to prevent the boys from escaping or from doing damage but a duty to take such care as in all the circumstances was reasonable in the hope of preventing the occurrence of events likely to cause damage to the company.

Case Example New South Wales v Godfrey (2004) Aust Torts Reports ¶81-741; [2004] NSWCA 113 Facts: A prisoner escaped from a jail run by the defendant. Over two months later, he robbed a newsagency. During the robbery, he pointed a shotgun at the first plaintiff, who was 23 weeks pregnant. She suffered shock and gave birth [page 348] prematurely eight days after the robbery. Her son, the second plaintiff, suffered disabilities as a result of his premature birth. Both plaintiffs sued the defendant, alleging that their injuries were caused by its negligence in allowing the prisoner to escape. The defendant did not contest that it had been negligent but argued that it owed the plaintiffs no duty. Issue: Did the defendant owe the plaintiffs a duty to prevent the prisoner from escaping and causing damage? Decision: The New South Wales Court of Appeal held that the defendant did not owe the plaintiffs a duty. Spigelman CJ (with whom Sheller and McColl JJA agreed) quoted extensively from Dorset Yacht. After referring to the passage quoted above from the judgment of Lord Morris of Borth-y-Gest, Spigelman CJ said (at [25]): It is of some significance that, in the passage quoted, Lord Morris of Borth-yGest referred to the possibility of escapees doing some damage ‘to property near at hand’. Spigelman CJ went on to say (at [31], [34]): There is no authority which recognises a duty of care to the public at large, beyond the immediate vicinity of the gaol from which an escape occurred. Indeed, the possibility that the Home Office could have been held liable for a burglary committed by the escapee Borstal boys at the other end of the United Kingdom has been described as ‘ludicrous’. (Lamb v Camden London Borough Council [1981] 1 QB 625 at 647 per Watkins LJ). … Dorset Yacht, with its focus on the immediate vicinity of the gaol, may be based on the proposition that a prison authority should be taken to still have control at that point, because the possibility of recapture is at its highest. … Gleeson CJ [in Modbury Triangle at [21] (see 6.22)] referred to Dorset Yacht as involving liability based on control … If Dorset Yacht does represent the law in Australia, its application should, in my opinion, be confined to the course of the escape, where control is capable of being reasserted by the persons who should have prevented

the escape. No such duty has ever been found to encompass conduct hundreds of kilometres from, and months after, an escape.

6.19 To say that the defendant could control the actions of the third party is very different from saying that the defendant should control those actions. (This distinction is prevalent throughout this whole area of the law: remember, the fact that I could save the drowning swimmer in 6.1 does not mean that I should do so, in the sense that I owe a legal — as opposed to a moral — duty to do so.) Where there is no pre-existing relationship between the defendant and the third party, such as teacher–pupil or jailer–prisoner, the courts have been much more reluctant to conclude that the power to control should be translated into a duty to control. 6.20 This distinction between ‘could’ and ‘should’ was a central feature in the next case. [page 349] Key Case Smith v Littlewoods Organisation Ltd [1987] AC 241 Facts: The defendant was a supermarket chain that owned a derelict property, which it was planning to demolish in order to build a supermarket. Vandals broke into the derelict property and started a fire, which spread to neighbouring properties. The plaintiffs, the owners of those properties, brought an action against the defendant for failing to keep its premises secure. Issue: Did the defendant owe a duty to its neighbours to keep its property secure against vandals? Decision: The House of Lords held that the defendants did not owe a duty in the circumstances. However, Lord Mackay of Clashfern (with whom Lords Keith of Kinkel, Griffiths and Brandon of Oakbrook agreed) stated obiter views on the question of whether a duty might arise in the absence of a special relationship. Lord Mackay described the circumstances in which a duty might arise in the absence of a special relationship as follows (at 261): [W]here the only possible source of the type of damage or injury which is in

question is agency of a human being for whom the person against whom the claim is made has no responsibility, it may not be easy to find that as a reasonable person he was bound to anticipate that type of damage as a consequence of his act or omission. The more unpredictable the conduct in question, the less easy to affirm that any particular result from it is probable … Unless the judge can be satisfied that the result of the human action is highly probable or very likely he may have to conclude that all that the reasonable man could say was that it was a mere possibility. Unless the needle that measures the probability of a particular result flowing from the conduct of a human agent is near the top of the scale it may be hard to conclude that it has risen sufficiently from the bottom to create the duty reasonably to foresee it. Lord Goff of Chieveley took a rather different view, saying (at 278): But there is no general duty to prevent third parties from causing damage to others, even though there is a high degree of foresight that they may do so. The practical effect is that everybody has to take such steps as he thinks fit to protect his own property, whether house or flat or shop, against thieves.

6.21 In the next case, the New South Wales Court of Appeal preferred Lord Goff’s view in Smith v Littlewoods to that taken by Lord Mackay in the same case. Case Example WD & HO Wills (Australia) Ltd v State Rail Authority of New South Wales (1998) 43 NSWLR 338 Facts: The plaintiff’s goods were stolen from a building leased from the defendant. The building was in the middle of the defendant’s rail yard, which was left unguarded overnight. The plaintiff sued the defendant alleging (among other things) that it [page 350] should have taken reasonable steps to make the rail yard secure so that thieves could not gain access to the leased premises. Issue: Did the defendant owe a duty to keep its rail yard secure against thieves? Decision: The Court of Appeal of New South Wales held that the defendant did not owe the plaintiff a duty to keep the rail yard secure. Mason P (with whom Priestley and Beazley JJA agreed) said (at 359–60): Lord Mackay [in Smith v Littlewoods] appeared to favour a test of probability as distinct from possibility as the basis of a duty of care to protect against fire-

caused damage … I confess to difficulty in seeing that the existence of duty turns upon the level of probability of harm ensuing. There may be a very high probability that criminal activity causing harm may take place in certain areas of Sydney, but non constat [ie it does not follow] that the occupier or adjacent neighbour has a duty of care to those who suffer. The mechanism of foreseeability is ultimately an unsatisfactory touchstone of a duty of care in this area … In my respectful opinion, the speech of Lord Goff in Smith is not only persuasive. It is correct in principle. To impose a general duty on occupiers to take reasonable care to prevent others from entering their property and using it as a springboard for stealing from a neighbour’s property would offend several precepts. It would be a classical case of indeterminate liability owed to an indeterminate class. It would create an unprecedented and unprincipled duty to take positive steps to control third persons, in the absence of special circumstances such as consideration or assumption of responsibility. It would impose an unreasonable curb upon the ordinary enjoyment of a defendant’s own property. And it would tend to encourage those having the capacity to take precautions for their own property, to decline to do so.

6.22 One might have expected the courts to be more willing to impose a duty to act in cases involving physical attacks on a person, rather than damage to property. Recent cases show that, in the absence of a special relationship, Australian courts are still as reluctant to impose a duty in personal injury cases as in property damage cases. Key Case Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; 176 ALR 411 Facts: An employee of a video store in a suburban shopping centre was attacked and badly injured while walking to his car in the shopping centre’s car park after the shopping centre had closed. He sued the shopping centre, alleging that it had negligently failed to protect him from criminal attack by third parties. Issue: Did the shopping centre owe the plaintiff a duty to protect him from being attacked by others? Decision: The High Court of Australia held (by a majority of four to one) that the shopping centre owed no duty to protect the plaintiff. Although the majority held that the shopping centre’s duty to entrants on its property did not extend to taking positive steps to control the criminal actions of third parties, it left open the slim [page 351]

possibility that a duty might be found in other cases. Gleeson CJ (with whom Gaudron and Hayne JJ agreed) said (at [29]–[30], [34]): The unpredictability of criminal behaviour is one of the reasons why, as a general rule, and in the absence of some special relationship, the law does not impose a duty to prevent harm to another from the criminal conduct of a third party, even if the risk of such harm is foreseeable. There may be circumstances in which, not only is there a foreseeable risk of harm from criminal conduct by a third party, but, in addition, the criminal conduct is attended by such a high degree of foreseeability, and predictability, that it is possible to argue that the case would be taken out of the operation of the general principle and the law may impose a duty to take reasonable steps to prevent it. The possibility that knowledge of previous, preventable, criminal conduct, or of threats of such conduct, could arguably give rise to an exceptional duty, appears to have been suggested in Smith v Littlewoods Organisation Ltd. … It is unnecessary to express a concluded opinion as to whether foreseeability and predictability of criminal behaviour could ever exist in such a degree that, even in the absence of some special relationship, Australian law would impose a duty to take reasonable care to prevent harm to another from such behaviour. It suffices to say two things: first, as a matter of principle, such a result would be difficult to reconcile with the general rule that one person has no legal duty to rescue another; and secondly, as a matter of fact, the present case is nowhere near the situation postulated.

Case Example Club Italia (Geelong) Inc v Ritchie (2001) 3 VR 447 (causation issues discussed at 4.48) Facts: The plaintiff, a police officer, was injured during a violent brawl at a debutante ball held at the defendant’s nightclub. Bouncers employed by the club had earlier identified the man who attacked the plaintiff, a man named Holton, as a potential troublemaker but decided against ejecting him for fear of causing a disturbance. The plaintiff had attended the club earlier in the evening at the defendant’s request to respond to a disturbance caused by patrons, but he was not warned before his return that the situation had deteriorated. Issue: Did the club owe the plaintiff a duty to control the actions of Holton by ejecting him from the ball? Decision: Distinguishing Modbury Triangle, the Court of Appeal of Victoria affirmed the

trial judge’s decision that the defendant was liable to the plaintiff. Brooking, Charles and Chernov JJA said (at 457): The facts in this case bear no resemblance to those in Modbury … The criminals in Modbury were in no sense under the control of the defendant. … Here the ruffian Holton could not properly be described as not under the control of the club. It did in fact fail lamentably to control him, and this is the only sense in which he was not under its control.

[page 352] Case Example Proprietors of Strata Plan 17226 v Drakulic (2002) 55 NSWLR 659 Facts: The plaintiff was robbed and injured by a masked intruder on the stairs in the block of units where she lived. She sued the body corporate that owned the building, alleging that her injuries were caused by its negligence, particularly because the building manager had disabled the lock on the main doors to the building. Issue: Did the defendant owe the plaintiff a duty to protect her from being attacked by others? Decision: The New South Wales Court of Appeal held, applying Modbury Triangle, that the defendant did not owe the plaintiff a duty of care to protect her from attack in the common property areas of the building. Mason P said (at [6]): [T]he case falls within the general principles discussed in Modbury Triangle Shopping Centre Pty Ltd v Anzil … And it does not attract the possible exceptions discussed therein, relating to (1) ‘a high level of recurrent, predictable criminal behaviour’ (per Gleeson CJ (at 268, [33]); see also Hayne J (at 293, [117]); cf Callinan J (at 300, [143]), citing WD & HO Wills (Australia) Ltd v State Rail Authority of New South Wales [see 6.21] … and (2) to occupiers who fail to control access to or continued presence on the premises (per Hayne J (at 293, [117]).

Case Example Hunter and New England Local Health District v McKenna (2014) 253 CLR 270; 314 ALR 505

Facts: The plaintiffs were relatives of a man who was murdered by his friend, who had a long history of paranoid schizophrenia. The man had taken his friend to a hospital, where he was detained overnight under the Mental Health Act 1990 (NSW), before being released the following day into the plaintiffs’ relative’s care. The friend killed the plaintiffs’ relative while the two men were driving home. The plaintiffs sued the local health authority alleging that the hospital had acting negligently by releasing the schizophrenic man into their relative’s care. Later, the mentally ill friend took his own life. Issue: Did the defendant health authority owe the plaintiffs a duty to keep the schizophrenic man from causing harm to others? Decision: The High Court of Australia held unanimously that the defendant health authority did not owe the plaintiffs a duty of care. The Mental Health Act 1990 (NSW) s 20 required that a mentally ill person be released from detention unless the medical superintendent of the hospital formed the opinion that no other care of a less restrictive kind was appropriate and reasonably available. French CJ, Hayne, Bell, Gageler and Keane JJ said (at [33]): The powers, duties and responsibilities of doctors and hospitals respecting the involuntary admission and detention of mentally ill persons were prescribed by the Mental Health Act. It is the provisions of that Act which identified the matters to which doctors and hospitals must have regard in exercising or not exercising those powers. Those provisions are inconsistent with finding the common law duty of care alleged by the relatives.

[page 353] 6.23 Although Modbury Triangle (see 6.22) and the cases following it might give the impression that there is never a duty to protect another person from criminal conduct by a third party, it is worth remembering that the relationship of employer and employee is one of the special relationships that gives rise to a duty of affirmative action (see 6.11). As a result, employers do owe their employees a duty to take reasonable care to protect them from criminal activity by third parties: see Chomentowski v Red Garter Restaurant Ltd (1970) 92 WN (NSW) 1070; Fraser v State Transport Authority (1985) 39 SASR 57; Public Transport Corporation v Sartori [1997] 1 VR 168; Ogden v Bells Hotel Pty Ltd [2009] VSC 219. In Modbury Triangle (at [26]), Gleeson CJ acknowledged that a duty to take reasonable care to protect another from the criminal behaviour of third parties, ‘random and unpredictable as such

behaviour may be’ may arise in the relationships of employer and employee, school and pupil and bailor and bailee. Problem 1 6.24 Twenty-five-year-old Prudence is a compulsive gambler who has attended the Daisy Bay Casino daily ever since she turned 18. Any time she wasn’t trading stocks on the net, she was at the casino hoping to make her fortune. Although the casino was located in one of Daisy Bay’s most desirable riverfront neighbourhoods, as the general economy spiralled downwards (in the aftermath of the global financial crisis and a series of meltdowns, including the Australian share and housing markets, Greek, Portuguese, Irish, Spanish, Italian and American economies and Japanese nuclear reactors), widely reported nearby robberies of casino patrons had increased with regular frequency. There was speculation that large segments of the community were finding themselves destitute for myriad reasons, ranging from job losses to suffering different types of addiction, including, most obviously, gambling. Late one night, just before midnight, Prudence was happily counting her blackjack winnings as she strode across the casino’s parking lot to catch the train to her Aspirationville home. As she did so, Bruno, a man in his twenties, also exited the casino, thrown out because of his raucous and vulgar behaviour. Bruno had been released from Daisy Bay Detention Centre six months ago, having been convicted of fraud and credit card offences. A fortnight ago, Bruno had lost his irregular job working with Derrick Danson, a local entertainment provider. Bruno’s circumstances and history were very well known to Daisy Bay Casino employees, as he had frequented their venue daily since his release from the detention centre. In fact, Bruno put himself on the casino’s ‘voluntary exclusion order’ list, because of the enormous losses he suffered whenever he attended — which was almost all the time, every day. But despite the fact he knew he had a problem, he kept returning, hoping to recoup his losses. The casino let him return. However, in compliance with the terms of the voluntary order, the casino manager reminded Bruno of his addiction problem, telling Bruno he should seek counselling. It was rumoured that Bruno had returned to criminal activity to support his addiction. [page 354] As Bruno left the casino, enraged because of his losses at the blackjack table, he caught a glimpse of the big winner — Prudence. Upon seeing Prudence, he assaulted her, grabbed her purse and ran off. He has not been apprehended. All the security guards were inside the premises. No security cameras recorded the incident. Dr Divine, dining with friends at Cupid’s Kitchen, having hit the jackpot playing at the adjacent casino earlier that evening, observed the incident from his table, situated near the restaurant’s window. In an effort to help, an onlooker ran into the posh restaurant, calling out excitedly, ‘Is there a doctor in the house? Someone’s lying on the ground — she needs help!’ Like everyone else in the restaurant, Dr Divine did not respond, ignoring

the plea for help and what he had observed, intent on enjoying his chicken Kiev with a side order of mushroom risotto, his first martini and his droll dinner companions’ lively conversation. He wanted to relax — it had been a long, hard week at work. Prudence has instituted negligence proceedings against Daisy Bay Casino and Dr Divine. Using the authorities considered in this chapter, discuss whether Daisy Bay Casino and Dr Divine owe Prudence a duty of care. Note that in fully developed answers, the cases explored in Chapter 5 and the ‘salient features’ approach to duty of care issues also would be relevant to an analysis of this scenario.

Discussion Arguments for Prudence regarding the Casino and Dr Divine 6.25 The relationship between Daisy Bay Casino and Prudence — entertainment venue and patron — obviously is not one of those special relationships that clearly give rise to a duty on one person to control the actions of another, such as parent and child (as in Smith v Leurs), teacher or school and child (as in Richards v Victoria, Victoria v Bryar, Geyer v Downs, Trustees of the Roman Catholic Church for the Diocese of Bathurst v Koffman, Uniting Church in Australia Property Trust (NSW) v Miller and Cox v New South Wales) or prison authority and prisoner (as in Howard v Jarvis or New South Wales v Bujdoso). In Smith v Leurs, Dixon J stated that, in the absence of such a ‘special relationship’, there is, in general, no duty on one sane, responsible adult to control the actions of other sane, responsible adults. Prima facie, then, it is conceded that Daisy Bay Casino likely will argue that it did not owe Prudence a duty to take any steps to control Bruno’s actions. There are, however, exceptions to Dixon J’s general rule, and this is one of those exceptions. The quality that the court looks for in order to establish this exceptional duty is one of ‘care and control’. Here, Bruno’s relationship with Daisy Bay Casino had the necessary ‘care and control’, such that the court should impose a duty. Bruno was ‘very well known’ to the casino employees, having regularly attended and gambled there every day for the last six months. Indeed, he had put himself on a voluntary exclusion order (although neither he nor the casino staff respected the order). Imposing a duty here would not raise problems of indeterminate liability, as [page 355] was feared by the New South Wales Court of Appeal in WD & HO Wills (Australia) Ltd v State Rail Authority of New South Wales. Prudence is not suggesting that every patron/venue relationship justifies the imposition of this admittedly exceptional duty. What is significant and special here is the element of control, in a manner similar to Dorset Yacht Co Ltd v Home Office, Smith v Leurs and Club Italia (Geelong) Inc v Ritchie, where duties were held to exist.

In fact, in some respects, the relationship between Daisy Bay Casino and Bruno is not all that different from classic relationships in which control is evident: the fact that the casino had detailed knowledge of Bruno’s propensity (or at least potential) for getting into trouble criminally, his gambling and his lack of employment were matters about which it should have been very concerned. It should have prevented Bruno from spiralling further downwards. He was destitute, virtually living at the casino, and his involvement in criminal activity had been rumoured. The casino had the ability to control his gambling, by either restricting or prohibiting it, or at least ensuring that he be treated by counsellors. He was, in effect, under the casino’s control. Prudence would concede that Australian courts have demonstrated a reluctance to impose a duty to control the conduct of a third party in the absence of a special relationship, even in personal injury cases. This is illustrated by Modbury Triangle Shopping Centre v Anzil, where the High Court of Australia denied a duty, because in its view the third party behaviour involved random, unpredictable acts of criminal violence. The High Court held that the shopping centre defendant’s duty to the video store’s employee did not extend to taking positive steps to control the conduct of a criminal third party. However, the court did not preclude finding this type of duty in all circumstances. On appropriate facts, finding such a duty is conceivable. Club Italia (Geelong) Inc v Ritchie (noted earlier) is one such example, where the Victorian Court of Appeal found this exceptional duty, even where the third party’s acts involved serious criminal conduct. In Club Italia, it was held that a nightclub owed a duty to the police to take reasonable steps to protect the plaintiff from the actions of one of its patrons, even though there was no ‘special relationship’ between the club and the police. The defendant club breached its duty because it failed to control a third party who was clearly meant to be under its control, and did nothing to warn the attending officer of the deteriorating, raucous circumstances. Ejecting Bruno from the casino without any sort of supervision was foolish, seeing that he was in an enraged condition. He was allowed to leave unescorted, without providing any security to monitor his movements. By doing nothing to stop Bruno from posing a threat to other patrons (or neighbours), especially when it knew of Bruno’s propensity for committing crimes, Daisy Bay Casino acted in the same way as the defendant club in Club Italia. Indeed, it simply foisted a problem over which it had control onto the community, when it knew about escalating criminal activity against casino patrons. In the instant case, the ability to exert control still existed, as in Club Italia and unlike New South Wales v Godfrey, where the escapee from the jail was nowhere near the immediate vicinity of the jail and the assault took place months after his escape. Here, control was exercisable; it simply was not exercised. [page 356] The defendant in Club Italia did nothing to control (restrain or eject) the dangerous troublemaker, even though it knew he might cause harm to others, including the police. The duty in Club Italia arose because the third party, Holton, was (meant to be) under the control of the club, even though it did ‘fail lamentably to control him’. The club had

the means of preventing and responsibility to prevent that harm from occurring. While, ironically, in this case the assault occurred because of Bruno’s ejection from the premises, the same rationale as that used in Club Italia can be employed. Indeed, because Bruno’s behaviour was predictable criminal activity, imposing a duty on Daisy Bay Casino to control Bruno’s potentially risk-producing conduct is even more justified than was the case in Club Italia. These circumstances clearly fit within one of the exceptions suggested in Modbury Triangle Shopping Centre v Anzil. In Wills, the court stated that there should be no general duty to act ‘in the absence of special circumstances such as assumption of responsibility’. In the present case, Prudence could argue that Daisy Bay Casino assumed responsibility for all its patrons’ safety and welfare and those with whom they came into contact. Here, the casino had a history and long-standing relationship with both Bruno and Prudence. Innocent people like Prudence were entitled to expect Daisy Bay Casino to control Bruno when he became unruly, irresponsible and potentially dangerous to the general public. Further, as was noted above, there was evidence of increased criminal activity in the vicinity of the casino, including frequent thefts from its patrons. Surely the casino owed a duty to patrons from whom it generated great profits, by assuming responsibility for their care, even when the risks came from third parties. This is especially so when the third parties were predictable perpetrators of harm. It was also quite likely that Bruno would cause harm to others if Daisy Bay Casino did not exercise control over his conduct. Prudence acknowledges that the court in Wills questioned the suggestion that a duty to prevent a third party from causing harm should be imposed simply because of the likelihood that harm will occur. According to Wills, it is immaterial that Bruno’s conduct was likely to cause harm to someone else and Daisy Bay Casino was able to put a stop to this behaviour. The court stated that no duty should arise merely because of the likelihood of harm arising if the defendant did nothing to intervene. However, this aspect of Wills can be distinguished in the present case (unlike the ‘assumption of responsibility’ rationale for imposing the duty, which Prudence relies upon), because it concerns property damage, not personal injury. The court emphasised that it would be unreasonable to require property owners to take steps to secure their own property in order to protect their neighbours’ property, as to do so would discourage the neighbouring property owners from taking precautions to protect their own property. This type of reasoning does not apply to the present kind of case. Prudence did not have the same ability to protect herself, when compared to Daisy Bay Casino’s duty to protect her and other patrons from harm. Once again, this is particularly noteworthy in a context where assailants had been committing increasingly widely reported assaults on casino patrons. Imposing a duty on Daisy Bay Casino would not involve an improper shifting of responsibility from that which otherwise could be said to be properly borne by Prudence. She is the rather hapless, unfortunate victim in these circumstances, who [page 357] should not, in the interests of justice, bear responsibility for her injuries, especially when it was her patronage (with others) that made the casino such a profitable enterprise. As

in Club Italia, Daisy Bay Casino was in the best position to protect Prudence from harm that was both foreseeable and rather likely to occur. Indeed, it had that obligation, even under the principles elucidated in Modbury. This was not a random act of violence, as in Modbury and Proprietors of Strata Plan 17226 v Drakulic. Here, the third party’s conduct was entirely predictable, as he became increasingly destitute and had a propensity for anti-social behaviour. On this basis, Daisy Bay Casino had a duty to act affirmatively, to prevent harm to its valued patron, Prudence. Cases such as CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board and Stuart v Kirkland-Veenstra do not defeat Prudence’s claim, as they involved matters of autonomy and personal responsibility. According to the High Court of Australia, if the plaintiff is free to protect herself or himself, there is no duty on others to take action. Prudence can convincingly argue that her circumstances are quite unlike those of the two deceased in Stuart and CAL, involving suicide and drinking to excess, respectively. While these cases may be of interest, they are distinguishable, because imposing a duty here would in no way interfere with her autonomy, as her injury was the result of a third party’s intentional act, which should have been prevented by the defendant, as in Club Italia. Further, Hunter and New England Local Health District v McKenna is of little assistance here, as the reasoning and result in that case were underpinned by the strict statutory obligations imposed on the Health Authority with respect to the detention of mentally ill individuals. Finding a duty would have been inconsistent with the relevant Act. No such statute governs the Daisy Bay Casino’s conduct in these circumstances. Reliance on this case to deny finding a duty in these circumstances would be misguided. Aside from Daisy Bay Casino owing Prudence an exceptional duty of care, so too does Dr Divine. He owed Prudence a duty to come to her assistance when asked to do so, and upon observing the accident first-hand, through Cupid’s Kitchen’s window. In Lowns v Woods, the New South Wales Court of Appeal held that in an emergency situation a duty of care was owed by a doctor to a person who was not the doctor’s patient. Although Lowns was decided on the basis of proximity principles, which are no longer endorsed by the High Court of Australia, Lowns has nevertheless been applied in other, more recent cases (even after the use of the ‘salient features’ approach to duty questions). BT v Oei held that a general practitioner owed a duty to warn the sexual partner of a patient with HIV, even though that person was not a patient of the doctor; in Alexander v Heise, a general practitioner was held to owe a duty of care to a prospective patient who contacted her or his office by telephone. Prudence would have to demonstrate that Lowns should be extended beyond the professional setting in which the doctor in Lowns found himself, to the present social setting — a restaurant. Other features that distinguish Lowns from the present case would also have to be addressed. Being on the verge of having one martini is not an ‘impediment’ to responding as a properly trained medical practitioner. Also, arguably a plea to all the patrons and workers in the restaurant (where a doctor just happens to be in attendance) is no different, legally, from Lowns, where the request was made directly (and solely) to the defendant doctor. [page 358]

Prudence would also argue that any public policy argument, whereby doctors contend that they would have inordinate burdens placed upon them if a duty were found here, are met by the fact that doctors are special, and the privileges associated with their profession carry with them certain corresponding significant responsibilities and obligations, unlike other members of the community. Further, Prudence would note that Lowns must be followed by other state courts, unless those courts are prepared to declare that this now-longstanding decision is ‘plainly wrong’. (See general commentary on precedent and, by way of example, the High Court’s comments in CAL with respect to the precedential value of the New South Wales Court of Appeal decision in Cole v South Tweed Heads Rugby League Football Club Ltd (2004) 217 CLR 469; 207 ALR 52.) Arguments for Daisy Bay Casino and Dr Divine 6.26 In Smith v Leurs, Dixon J stated that, as a general rule, a person owes no duty to control the actions of another. Prima facie, Daisy Bay Casino owed Prudence no duty to do anything to control Bruno’s actions. The relationship between the casino and Prudence was clearly not one of those ‘special relationships’ that give rise to a duty to control, such as prison authority and prisoner (as in Howard v Jarvis and New South Wales v Bujdoso) or teacher/school and pupil (as in Richards v Victoria, Victoria v Bryar, Geyer v Downs, Trustees of the Roman Catholic Church for the Diocese of Bathurst v Koffman, Uniting Church in Australia Property Trust (NSW) v Miller and Cox v New South Wales). In fact, as Graham v New South Wales illustrates, even these categories of special relationships have their limits. Bruno was not under Daisy Bay Casino’s care and control. He was a sane (albeit unhappy), responsible, independent adult, capable of taking responsibility for his actions, which could affect not only himself, but others as well. Although there is some authority for the proposition that a duty can arise in the absence of a ‘special relationship’ between the defendant and the person who caused the harm to the plaintiff, this is certainly not the norm. Indeed, the facts of the present case do not fit within the framework and requirements of those exceptional cases. Australian courts have, quite properly, been reluctant to impose a duty on one autonomous person to control the conduct of, and be responsible for, the conduct of another autonomous person. In Modbury Triangle Shopping Centre v Anzil, the High Court of Australia emphatically denied a duty involving the conduct of a third party unless very special elements are present in the relationship. While that case concerned random criminal acts of third parties, and left open the rare possibility of imposing a duty where exceptional third-party circumstances warrant it, this case is not of that nature. Club Italia (Geelong) Inc v Ritchie was exceptional. In Club Italia, it was held that the club owed police officers attending a deteriorating, violent function a duty to take reasonable care to protect them from injury caused by patrons, even though there was no special relationship between the club and the police. What was unique about that case was the fact that the defendant club had the violent third party in its sight, and under its (theoretical) control; unfortunately, the very control it had over its patron(s) was not exercised. The duty there required the club to take positive steps for the safety of the police — by warning them of the deteriorating situation.

[page 359] The present case is not similar to Club Italia. Here, the casino had no reason to suppose that Prudence’s safety was at risk when Bruno was ejected from the premises. It was not as if he had said anything threatening or had previously committed violent acts. His criminal convictions were for fraud and credit card offences. Indeed, Bruno had merely been raucous, vulgar and upset about his gambling losses. There is nothing unusual in this, and it is indeed rather commonplace at an entertainment venue like a casino. Any suggestion that Bruno was involved in criminal activity was nothing more than a rumour. Bruno’s actions were his alone and not the responsibility of anyone else. It would be quite inappropriate to impose on a defendant like the Daisy Bay Casino a duty to act affirmatively in circumstances like this, where indeterminate liability is a distinct possibility (as was the case in New South Wales v Godfrey). If anyone should be made liable for the unfortunate consequences suffered by Prudence, it is Bruno, the assailant. This claim is similar to those that were instituted in Godfrey, Modbury and Proprietors of Strata Plan 17226 v Drakulic, where responsibility for the harm in each case was that of the respective assailants. If Prudence wishes to complain she should be suing Bruno. However, it is assumed she is not doing so because he cannot be found (and is not worth suing, in financial terms). Like the unsuccessful plaintiffs in Godfrey, Modbury and Drakulic, Prudence is searching for a viable defendant. Unfortunately for Prudence, she cannot pin responsibility on Daisy Bay Casino for the conduct of an independent, autonomous person. Her harm simply amounts to an injury that goes uncompensated at common law. She could, however, claim compensation under the statutory scheme enacted in the jurisdiction in which Daisy Bay Casino is located. The requisite elements of control, needed to place this case within exceptional circumstances allowing for the imposition of a duty, are not present on these facts. At most, Daisy Bay Casino and Bruno have a ‘relationship’ of entertainment venue and patron. As was noted above, they are independent entities and Bruno is an autonomous adult. While it is true that Daisy Bay Casino has a list on which Bruno had placed his name for a voluntary exclusion order, this was not indicative of some sort of legal obligation and legal responsibility. This ‘order’ does nothing more than represent a type of moral responsibility stemming from the casino’s awareness of a patron’s problems. Daisy Bay Casino should maintain that this did not in any way amount to an ‘assumption of responsibility’, bearing in mind the statement of the New South Wales Court of Appeal in WD & HO Wills (Australia) Ltd v State Rail Authority of New South Wales that there should be no general duty to act ‘in the absence of special circumstances such as assumption of responsibility’. Here, there is nothing Daisy Bay Casino did that could be perceived as an assumption of responsibility with respect to Bruno’s conduct and Prudence’s wellbeing. Finding a duty here would be an enormous intrusion on the casino’s (and Bruno’s) autonomy. Despite being ongoing, the venue and patron relationship is not a basis on which an injured person should be able to rely in an attempt to impose civil liability. To do so would amount to the imposition of an unwarranted burden on an entertainment provider. As a prerequisite to finding a duty, Prudence may try to rely on Lord Mackay’s

comments in Smith v Littlewoods Organisation Ltd, arguing that Bruno’s actions [page 360] causing harm are ‘highly probable’. She may contend that the casino knew or ought to have known that Bruno might cause harm to others, based on the degree of his anger at incurring gambling losses. She may argue that it was likely he would take out his anger on the winning patron, causing untold harm, if not prevented from leaving the venue without an escort. However, the court in Wills held that a duty to act to prevent one person from causing harm to others should not be imposed simply because of the likelihood that harm will occur if the defendant does nothing to intervene to prevent it from occurring. Daisy Bay Casino should therefore not be placed under a duty to act for the safety of patrons when the injury is caused by the independent criminal acts of a third party, let alone a purported duty to anyone in the vicinity of the venue just because there was some possibility (likelihood seems a stretch) that harm might ensue. Prudence was not even inside the casino when the criminal assault occurred. As the court noted in Wills, there is a very high probability of criminal activity in some parts of Australia’s cities. In this case, there was evidence of increasing crime near the casino with respect to casino patrons. While this may perhaps point to the need for increased police presence in the area, it does not follow that occupiers in such a neighbourhood must owe a duty of care to those who are nearby who suffer harm. Further, just because the occupier has knowledge of increased violence in the area, it does not follow that the entertainment venue must be held to owe a duty of care to those who suffer harm as a result of coming into contact with one of the venue’s unhappy patrons. In fact, this was not that serious a risk in these circumstances: it was not as if Bruno had indicated he was going to commit an offence or seek revenge on the person who beat him at blackjack. As was noted earlier, it is Bruno who was responsible for Prudence’s harm, just like the third parties in Modbury, Godfrey and Drakulic. This is quite unlike Club Italia, where the third-party ruffian was under the control of the club and it had simply not exercised its control. Despite the fact that Hunter and New England Local Health District v McKenna arose in the context of a statutory regime involving the detention of mentally ill persons, distinguishing it on that basis does not of itself support Prudence’s ill-conceived claim. In terms of responsibility, in McKenna, it was the mentally ill patient who was responsible for the death of his friend; as here, it is Bruno, a third party, whose acts led to Prudence’s harm. Because of the High Court’s concerns with respect to consistency of obligations, it reasoned that the health authority had acted as required, bearing in mind the statutory prescription that patients should only be detained as a last resort. In a sense, it was required to ‘lose control’ of the patient. The issue of autonomy, noted earlier, can arise in a different way, as illustrated in cases like CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board and Stuart v Kirkland-Veenstra. It could perhaps be argued that in some respects, Prudence is responsible for her fate, due to her excessive gambling and the fact she was counting her winnings while strolling outdoors. She should have protected herself from harm and not expect the court to find a duty was owed to her in these

circumstances. She is not unlike the two deceased in Stuart and CAL, who were essentially the authors of their own misfortune. [page 361] Daisy Bay Casino does not owe Prudence a duty of care to prevent harm occasioned by Bruno’s conduct; neither does Dr Divine. Like any doctor in the restaurant, Dr Divine did not owe Prudence a duty to come to her assistance when asked to do so and upon observing the assault, the incident that caused her injury. There is no general duty to take positive steps for the safety of others. While Dr Divine may arguably deserve moral condemnation for not responding to the plea for help (although this is not in fact conceded), his acts — continuing his meal and enjoying his well-deserved leisure time and chance to relax — do not attract legal liability as he owes no legal duty to act. Furthermore, the decision in Lowns v Woods was based upon a now discredited, shaky legal foundation — when ‘proximity’ was seen to be a unifying factor underlying all circumstances in which a duty of care exists. This is no longer the legal position in Australia. It could in any event be argued that Lowns itself went too far, using the proximity framework, to justify this new special category of case in which a duty was imposed for a pure omission (and this great leap should have been left to the legislature). The fact that BT v Oei and Alexander v Heise applied Lowns is of little consequence here — a case that involves a doctor in a social setting, outside his office and outside office hours. In any event, Lowns can clearly be distinguished from the present case. In Lowns, it was important that the plea for help was made to the doctor in his professional setting. This is not the case here, where the pleas occurred in a posh restaurant. The call for assistance in Lowns was made directly to the doctor as the plaintiff’s sister deliberately sought him out; once again, the present situation is materially different, as a general request was made to everyone in the restaurant. Additionally, in the instant case, Dr Divine was not in a position to act as he was drinking alcohol, the very kind of impediment that did not exist in Lowns. This factor was highlighted by the court in Lowns as the kind of circumstance that would point away from imposing a duty to rescue upon a doctor with respect to a non-patient as it would diminish her or his capacity to respond carefully. In terms of public policy considerations, Dr Divine would further argue that it would be unfair and unjust for medical (and other health) professionals to owe this positive duty to act to all members of the community at all times. A consequence of such a decision would be the ever-present threat of potential litigation and civil liability. Finally, it should be noted that if Daisy Bay is in a jurisdiction outside New South Wales, it would be appropriate for the court deciding the case to not apply the egregious decision in Lowns, by declaring it to be ‘plainly wrong’. If Daisy Bay is in New South Wales, and this case made its way to the New South Wales Court of Appeal, that court could use Dr Divine’s circumstances as a welcome opportunity in which to overrule Lowns. Even if the New South Wales Court of Appeal could not be persuaded to go so far as to overrule Lowns, it should readily distinguish Lowns on these facts, for the

reasons noted above. Of course, the High Court of Australia could finally put Lowns, a most unfortunate and retrograde decision, to rest.

[page 362]

Problem 2 6.27 For four years, best friends Dawn and Eve shared a flat in one of Daisy Bay’s swankiest suburbs. Dawn, an independently wealthy socialite, was all too familiar with Eve’s serious drinking problem: on several occasions, bartenders would ring Dawn to escort an inebriated Eve from the local pub. In late February, to celebrate the start of another year dabbling in courses at Daisy Bay University, Dawn hosted a party at her riverfront flat near the Daisy Bay Casino for about 30 friends. During the course of the evening, Eve, true to form, drank to such a degree that she became incoherent and wobbly when walking. At around 11:00 pm, Eve, bored to tears with what she described as ‘this nerdy, gonowhere party’, told her friend Steve that she was leaving — to visit Adam, who lived six blocks away. Steve told Eve that she should probably lie down for an hour. Eve insisted on leaving. Although Dawn witnessed this exchange, she ignored what she overheard as she was intent on enjoying herself. She wanted to relax — it had been a long, hard week attending gallery openings and tending to her charity work. In any case, she was fed up with constantly having to act as Eve’s pseudo-guardian. Eve left the party. Having walked a few blocks, she began to feel dizzy. As she tried to lie down on the footpath, she lost her balance, falling onto the road. At that moment, Pavan saw Eve suddenly fall onto the road; he swerved his motor vehicle to avoid injuring her, unavoidably driving into a parked car, injuring himself seriously. Dr Denial was dining with friends and colleagues, including his twin brother, Dr Divine, at Cupid’s Kitchen. Dr Denial observed this unfortunate incident from his table, situated near the restaurant’s window. In an effort to help, an onlooker ran into the posh restaurant, calling out excitedly, ‘Is there a doctor in the house? Someone’s had a car accident — he needs help!’ Like everyone else in the restaurant, Dr Denial did not respond, ignoring the plea for help and what he had observed, intent on enjoying his chicken Kiev with a side order of mushroom risotto, his first martini and his droll dinner companions’ lively conversation. He wanted to relax — it had been another long, hard week at work. Exasperated, Drs Denial and Divine commented to one another, with disdain, ‘Why won’t they just let us eat our Kievs in peace?’. Dr Divine also did not respond to the plea for help. Pavan has instituted negligence proceedings against Dawn and Drs Denial and Divine. Discuss whether they owe Pavan a duty of care.

Further discussion 1. Critically consider the legal principles outlined in this chapter (and the problem involving Prudence, the Daisy Bay Casino and Dr Divine) in the light of the following quotation: How would [the] drowning-stranger hypothetical look from a new legal perspective informed by a feminist ethic based upon notions of caring, responsibility, interconnectedness and cooperation? If we put abstract reasoning

[page 363] and autonomy aside momentarily, we can see what else matters. In defining duty, what matters is that someone, a human being, a part of us, is drowning and will die without some affirmative action. That seems more urgent, more imperative, more important than any possible infringement of individual autonomy by the imposition of an affirmative duty. (L Bender, ‘A Lawyer’s Primer on Feminist Theory and Tort’ (1988) 38 Journal of Legal Education 3 at 34.)

2. Should a parent owe her or his child a duty of care? Does the fact that Robertson v Swincer arose in the context of third party contribution proceedings help explain the result? Is the reasoning in St Mark’s Orthodox Coptic College v Abraham preferable to that in Robertson? 3. Does the presence of third party compulsory insurance explain the results in Lynch v Lynch and Bowditch v McEwan? 4. Do you agree with the reasoning and result in Lowns v Woods? Should it be extended? Should it be overruled? Should it be followed outside New South Wales or should courts in other jurisdictions not follow it because they are convinced it is ‘plainly wrong’? (This issue, concerning when an authority is binding, is discussed in CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board with respect to the decision of the New South Wales Court of Appeal in Cole v South Tweed Heads Rugby League Football Club Ltd.)

Recall the High Court of Australia decision in Adeels Palace v 5. Moubarak (2009) 239 CLR 420; 260 ALR 628 (discussed in 4.8), handed down the same day as the High Court decision in CAL (No 14) Pty Ltd (t/as Tandara Motor Inn) v Motor Accidents Insurance Board. Can you explain why the High Court found a duty of care in Adeels Palace but not in CAL? Or, indeed, how the High Court in Adeels Palace was able to distinguish Modbury Triangle Shopping Centre v Anzil? (Note that the plaintiffs in Adeels Palace failed in their claim because they could not establish causation. They also had some difficulties proving breach.) 6. How would you justify the result in Hunter and New England Local Health District v McKenna to the relatives of the deceased, who were unsuccessful in their claim?

Further reading Balkin R P and Davis J L R, ‘Duty of Care’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 7. Barker K, Cane P, Lunney M and Trindade F, ‘Negligence and the Scope of the Obligation to Take Care: Duty of Care’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 9. Fordham M, ‘Saving Us from Ourselves — The Duty of Care in Negligence to Prevent Self-Inflicted Harm’ (2010) 18 Torts Law Journal 22. Hodgson D, ‘Rescue of Persons and Property in a Comparative Common Law and Civil Law Context’ (2011) 19 Tort Law Review 125. [page 364] Kirby M, ‘Of Advocates, Drunks and Other Players: Plain Tales from

Australia’ (2011) 19 Torts Law Journal 89. Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Particular Negligence Situations’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 7. Malkin I, ‘A Mother’s Duty of Care to Her Foetus While Driving: A Comment on Dobson v Dobson (and Lynch v Lynch)’ (2001) 9 Torts Law Journal 109. Scott G, Richardson K and Hocking B, ‘The Liability of Publicans: Rejection of the Canadian Approach’ (2010) 18 Tort Law Review 117.

[page 365]

7 Liability of Public Authorities Objectives After completing this chapter, you should: — understand the factors that a court takes into account when determining at common law whether the holder of a statutory power has a duty to exercise that power; — know the statutory principles that have been added to the common law factors in some jurisdictions; — have some sense of the relationship between the common law principles and the statutory principles in different jurisdictions; — have a working knowledge of special, more restrictive provisions about the liability of public authorities in some jurisdictions; — understand the factors that a court takes into account in determining whether a public authority has failed to take reasonable care in the exercise of its statutory powers; — have a working knowledge of when a court will view it as inappropriate to pass judgment on the reasonableness of a decision by a public authority; — understand the special immunity available to highway authorities in most jurisdictions.

Key cases

— Amaca Pty Ltd v New South Wales (2004) 132 LGERA 309 — Bankstown City Council v Zraika (2016) 74 MVR 505 — Brodie v Singleton Shire Council (2001) 206 CLR 512; 180 ALR 145 — Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1; 167 ALR 1 [page 366] — Curtis v Harden Shire Council (2014) 88 NSWLR 10 — Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; 194 ALR 337 — Pyrenees Shire Council v Day (1998) 192 CLR 330; 151 ALR 147 — Stuart v Kirkland-Veenstra (2009) 237 CLR 215; 254 ALR 432 — Sutherland Shire Council v Heyman (1985) 157 CLR 424; 60 ALR 1

Key legislative developments — Civil Law (Wrongs) Act 2002 (ACT) ss 110, 112, 113, 114 — Civil Liability Act 2002 (NSW) ss 42, 43A, 44, 45, 46 — Civil Liability Act 2003 (Qld) ss 35, 37 — Civil Liability Act 2002 (Tas) ss 38, 41, 42, 43 — Wrongs Act 1958 (Vic) ss 83, 85 — Road Management Act 2004 (Vic) ss 102, 103 — Civil Liability Act 2002 (WA) ss 5W, 5Z, 5AA

Introduction

7.1 Many bodies and organisations derive their existence, functions and powers from statute. For example, local authorities such as city or shire councils are created by statutes that define the functions that the authority exists to perform, and the powers that it may exercise in performing those functions. In some cases at least, if a statutory authority causes damage while exercising its statutory powers it may be liable in the tort of negligence in the same way as any other defendant: see, for example, Nader v Urban Transit Authority of New South Wales (1985) 2 NSWLR 501 (statutory body held liable for negligently causing personal injuries: see 4.57); Shaddock & Associates Pty Ltd v Parramatta City Council (No 1) (1981) 150 CLR 225 (local authority held liable for negligent misstatements causing purely economic loss: see 8.15). Similarly, a statutory body may be liable for breaching any statutory duty imposed on it: for example, Read v Croydon Corporation [1938] 4 All ER 631 (local authority held liable for breach of statutory duty). 7.2 Although statutory authorities are just like ordinary defendants in some respects, they have a number of special qualities that may, in some circumstances, require quite different treatment. First, they are essentially public bodies, quite unlike private individuals or companies. In Chapter 6, we saw that the law is, in general, reluctant to impose on a private person a duty to act, rather than simply to do nothing. A private individual may raise what Lord Hoffmann in Stovin v Wise [1996] AC 923 at 944 called the ‘why pick on me?’ argument: A duty to prevent harm to others or to render assistance to a person in danger or distress may apply to a large and indeterminate class of people who happen to be able to do something. Why should one be held liable rather than another? In

[page 367] economic terms, the efficient allocation of resources usually requires an activity should bear its own costs. If it benefits from being able to impose some of its costs on other people (what economists call ‘externalities’) the market is distorted because the activity appears cheaper than it really is. … So there must be some special reason why [a defendant] should have to put his hand in his pocket.

Because statutory authorities are public bodies set up to perform some function for the public good, the ‘why pick on me?’ argument does not work, or at least does not work in the same way. The law can respond, ‘Why pick on you? Because that is the kind of thing you were set up to do, and that the public has given you money to do’. Thus, for example, a fire authority may be under a duty to take positive steps to guard against a risk of fire, when a private individual might not be: see Northern Territory v Deutscher Klub (Darwin) Inc (1994) 4 NTLR 25 (NTCA); New South Wales v West (2008) 165 ACTR 47 (ACTCA). 7.3 Second, there is the fact that public authorities are usually given a wide discretion about how to perform their statutory functions. As we will see in Chapter 13, breach of a statutory duty may give rise to liability if it causes loss, but statutory powers are quite different from statutory duties. If the statute in question confers a power, rather than imposing a duty, one can infer that parliament intended the public authority to have a choice about whether and how to exercise that power. It is arguable, then, that the common law should not impose a duty to exercise the statutory power if parliament did not see fit to impose a duty by statute. As Lord Romer put it (in rather archaic language) in East Suffolk River Catchment Board v Kent [1941] AC 74 at 103 (quoting du Parcq LJ in the Court of Appeal, [1940] 1 KB 319 at 338): [W]hen Parliament has left it to a public authority to decide which of its powers it shall exercise, and when and to what extent it shall exercise them, there would be some inconvenience in submitting to the subsequent decision of a jury, or judge of fact, the question whether the authority had acted reasonably, a question involving the consideration of matters of policy and sometimes the striking of a just balance between the rival claims of efficiency and thrift.

7.4 Third, there is the fact that public authorities must perform their statutory functions with limited resources. In Chapter 3, we saw that a private individual cannot argue that she or he did not have sufficient resources to undertake a particular activity with reasonable care as the legal response will be that she or he should not then have undertaken that activity at all. In contrast, public authorities are under a general obligation to perform the statutory functions for which they were created, and so they are not usually free to sit back and do absolutely

nothing. If a public authority makes a policy decision to perform its statutory functions by exercising a statutory power only in a limited way because of the resources available, it is arguable that it should not be held liable for failing to do more, as the whole purpose of statutory bodies is to make policy decisions of this kind. If, however, the public authority does make a policy decision to exercise one of its statutory powers, but simply exercises that power in a negligent fashion, there seems to be no reason why it should not be liable for negligence at an operational level. [page 368] 7.5 Fourth, there is the fact that the powers of public authorities are confined to those that are conferred by statute. A private individual has power to do anything of which she or he is physically capable, but a public authority has only limited legal power. If a public authority acts in a way that is beyond its limited statutory powers (that is, ‘ultra vires’, or ‘beyond power’), it has exceeded what parliament intended it to do, and has acted illegally. If a person suffers loss as a result of that illegal (ultra vires) act, it is arguable that she or he should be able to recover damages. 7.6 These factors combine, overlap and are sometimes inconsistent with one another. Generally speaking, though, the effect of these factors is that two main questions arise with respect to the liability of public authorities. They are: 1. whether and when a public authority is under a duty to exercise its statutory powers; 2. whether and when a public authority is under a duty of reasonable care when it exercises its statutory powers.

When Does a Public Authority Owe a Duty to Exercise its Statutory Powers?

Introduction 7.7 The High Court of Australia has on several occasions considered the question whether a public authority owes a common law duty to exercise its statutory powers but, as Ipp JA observed in Amaca Pty Ltd v New South Wales (2004) 132 LGERA 309 at [19], ‘[a] clear and universal test for determining whether a duty of care arises has not been laid down’. Similarly, in Stuart v Kirkland-Veenstra (2009) 237 CLR 215; 254 ALR 432 at [131], Crennan and Kiefel JJ said: ‘No guiding principle, by which an authority might be considered to be obliged to exercise its powers at common law, has been identified; the search continues.’ 7.8 The difficulty referred to in 7.7 in discerning the relevant common law principles is compounded by the fact that most Australian jurisdictions have legislated to modify the common law to some extent, but they have not done so in uniform fashion. As a result, the law in this area is a confusing patchwork of common law and statutory principles — or rather, several different confusing patchworks in different parts of the country, combining to produce a crazy quilt of confusing patchworks. There are four different combinations of common law principles and statutory principles, which are dealt with separately in this chapter. 1. Common law principles continue to govern in South Australia and the Northern Territory, which have not legislated to modify them: see 7.10–7.16. 2. Six of the eight jurisdictions have enacted legislation stipulating the principles that should be taken into account in deciding whether a public authority owes a duty of care: see 7.17. The statutory principles do not replace the common law [page 369] principles but supplement and clarify them, and may have no work to do if the common law gives a clear answer: see 7.18–7.20.

3. New South Wales has enacted a provision, the Civil Liability Act 2002 (NSW) s 43A, which states a precondition for the existence of civil liability. The section imposes an additional, very restrictive, requirement, beyond those of the common law, before liability can be established: see 7.23–7.24. 4. Three jurisdictions (the Australian Capital Territory, New South Wales and Tasmania) have enacted another provision (see 7.26) that has the effect of restricting the category of plaintiffs who may bring an action claiming damages from a public authority: see 7.27. 7.9 New South Wales falls into three of these four categories (2, 3 and 4); the Australian Capital Territory and Tasmania fall into two of them (2 and 4). The relationship among the statutory provisions in the different categories has not been authoritatively explained, but they appear to be cumulative. What that means is that, in New South Wales, a court must apply common law principles as modified by the legislative provisions in category 2, but can only impose liability if the precondition set by Civil Liability Act 2002 (NSW) s 43A (category 3) is satisfied, and can only award damages to a plaintiff who satisfies the requirements about standing set out in the provision in category 4. If any of the cumulative requirements is not satisfied — that is, if there is no duty according to the principles in category 2 or the precondition in category 3 is not satisfied or the plaintiff does not have standing according to category 4 — the statutory authority cannot be held liable. The same is true in the Australian Capital Territory and Tasmania, but without the precondition in category 3.

The common law (category 1) 7.10 The development of the Australian common law was summarised by Ipp JA in Amaca Pty Ltd v New South Wales, which is extracted at length at 7.15. The common law remains relevant to a greater or lesser extent in all eight jurisdictions, so it is appropriate to consider, at least in outline, the series of High Court cases, although it is worth remembering the warnings in 7.7 that they did not produce a ‘clear and universal test’ or single ‘guiding principle’.

7.11 The story begins with Sutherland Shire Council v Heyman (1985) 157 CLR 424; 60 ALR 1, where a majority of the High Court of Australia (Mason, Brennan and Deane JJ) held that a public authority is under no general common law duty to exercise its statutory powers. A majority agreed, however, that a duty could arise in cases of ‘specific reliance’, when the public authority acts in such a way as to lead the plaintiff to believe that it will exercise its powers for her or his protection, and when the plaintiff acts to her or his detriment in reasonable reliance on that expectation. 7.12 The next case in the series was Pyrenees Shire Council v Day (1998) 192 CLR 330; 151 ALR 147, where a fire broke out in the chimney of a fish and chip shop in [page 370] a small country town. After the fire was extinguished by the fire brigade, the shire council wrote to the tenants of the fish and chip shop requiring them to remedy the defect and warning them not to light a fire under the chimney until the defect had been remedied. The tenant assigned the lease to a new tenant, but did not tell the new tenant about the problem with the chimney. The new tenant lit a fire, which spread because of the defect in the chimney. The fire caused severe damage to the fish and chip shop and to a neighbouring video shop. The High Court of Australia held that the shire council was liable both to the new tenant of the fish and chip shop (by a majority of three to two) and to the owners of the video shop (unanimously). However, there was no agreement in the majority judgments about when a common law duty to exercise statutory powers might arise. The judgments variously emphasised the shire council’s actual knowledge of the risk of harm, the degree of control it had, the seriousness of the risk and the vulnerability of the occupiers of the neighbouring premises. 7.13

The next decision in the series, Crimmins v Stevedoring Industry

Finance Committee (1999) 200 CLR 1; 167 ALR 1, did not make the position any clearer. The plaintiff contracted mesothelioma as a result of inhaling asbestos fibres while working as a waterside worker. Throughout the period in question, he was assigned to jobs by the Australian Stevedoring Industry Authority, which regulated all work on the waterfront and exercised some supervisory functions in relation to safety. The High Court held (by a majority of five to two) that the Authority owed the plaintiff a common law duty to exercise its statutory powers to encourage safe working in stevedoring operations. The members of the court delivered seven separate judgments, expressing at least six different points of view about the basis for imposing a duty. One key element was the degree of control that the Authority had over the contracts of employment that waterside workers made, the conditions of work and the conduct of both workers and employers. 7.14 The High Court returned to the question again in Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; 194 ALR 337. In Graham Barclay Oysters, the applicant (the term used for the plaintiff in Federal Court proceedings) and many other consumers contracted hepatitis A after eating contaminated oysters taken from Wallis Lake in New South Wales. On behalf of the class of affected consumers, the applicant brought a representative action in the Federal Court of Australia against Wallis Lake oyster growers and distributors, and also against the shire council and the state of New South Wales. The actions against the council and the state alleged that they had negligently failed to exercise their statutory powers to prevent or reduce pollution of the waters of Wallis Lake. The High Court held unanimously that the shire council and the state did not owe a common law duty to exercise their statutory powers in the circumstances of the case. All of the justices distinguished the case from Pyrenees (see 7.12) but, once again, they gave different reasons for doing so. 7.15 In summary, the High Court held that the public authority owed a common law duty to exercise its statutory powers in Pyrenees (see

7.12)

and Crimmins (see 7.13) but not in Graham Barclay Oysters: see 7.14. Although the line between [page 371] duty and no duty was left unclear, it obviously lay somewhere between Pyrenees and Crimmins on the one hand, and Graham Barclay Oysters on the other. In the next case, the New South Wales Court of Appeal tried to synthesise the effect of the High Court cases into a single workable set of common law principles. Although the extract is longer than usual, it contains a masterly summary of the High Court decisions described in 7.10–7.14. Key Case Amaca Pty Ltd v New South Wales (2004) 132 LGERA 309 Facts: A worker named Hay contracted mesothelioma as a result of exposure to asbestos dust and fibre while working on a very large construction project. He brought an action in the New South Wales Dust Diseases Tribunal against his employer and the owner of the building that he had worked on. Those proceedings were settled. The employer and the building owner cross-claimed for a contribution from the plaintiff, which was the manufacturer and supplier of the asbestos products used on the construction site. The plaintiff consented to pay the building owner and was ordered by the Dust Diseases Tribunal to pay a contribution to the employer. The plaintiff then cross-claimed against the state of New South Wales, arguing that the state Department of Labour and Industry had contributed to Hay’s loss by failing to exercise its statutory powers to inspect work sites and to give safety directions. At first instance, the Dust Diseases Tribunal dismissed the plaintiff’s claim on the ground that it was not just and equitable that the state should contribute to the plaintiff’s liability. That order was upheld by the Court of Appeal of New South Wales but the High Court of Australia allowed an appeal, holding that the plaintiff’s contribution claim should not have been dismissed without first deciding whether New South Wales would, if sued, have been liable to Hay: see Amaca Pty Ltd v New South Wales (2003) 199 ALR 596. The High Court remitted the case to the Court of Appeal of New South Wales to consider the ‘logically anterior’ question of whether the state would have been liable to Hay. Issue: Did the state of New South Wales owe Hay a duty to exercise its statutory powers of inspection and supervision of work sites?

Decision: The Court of Appeal of New South Wales held that the state would not have been liable to Hay because it owed him no common law duty to exercise its statutory powers of inspection and supervision. Ipp JA (with whom Mason P and McColl JA agreed) began by observing (at [17]–[20]): The determination whether the State owed Mr Hay a duty of care as asserted by [the plaintiff] depends upon a proper understanding (and the application) of the principles laid down in Pyrenees Shire Council v Day; Crimmins v Stevedoring Industry Finance Committee; Graham Barclay Oysters Pty Ltd v Ryan and other decisions dealing with the negligent performance of statutory duties. A clear and universal test for determining whether a duty of care arises has not been laid down. Each case depends on its own circumstances and the totality of the circumstances must be weighed in the balance. Depending on the facts, different [page 372] factors have different degrees of significance. Nevertheless, Pyrenees, Crimmins and Graham Barclay Oysters point to and delineate the path that is to be followed. … It is appropriate to commence the discussion on this topic by repeating Mason J’s remarks in Sutherland Shire Council v Heyman (1985) 157 CLR 424. These remarks were referred to on a number of occasions in Pyrenees, Crimmins and Graham Barclay Oysters and are an important part of the discussion of the duty of care issue in those cases. After quoting at length from Heyman, Ipp JA said (at [21]–[22]): Nothing in Pyrenees, Crimmins and Graham Barclay Oysters is materially inconsistent with Mason J’s remarks. … Mason J did not suggest that the categories of circumstances in which an authority may attract a duty of care are closed. Later cases, which are in accord with the general propositions laid down in Sutherland Shire Council v Heyman, have extended the categories to situations where an authority has control over a particular situation that carries with it a risk of harm of which the authority knows or should know. That is to say, where an authority has such control, a duty of care may (not, I stress, must) be recognised. After considering Pyrenees, Crimmins and Graham Barclay Oysters, Ipp JA said (at [63]– [64]): The judgments in Pyrenees, Crimmins and Graham Barclay Oysters are variations on the themes in Sutherland Shire Council v Heyman. The variations do not represent a significant departure from anything that was said by Mason J in that case. The later judgments refine (and, as I have noted … above, in one respect expand) the general propositions laid down by Mason J and adapt them to the particular circumstances of the cases concerned. A duty of care was recognised

in Pyrenees and Crimmins because of the exceptional circumstances in each; not because a radically new principle was laid down. In summary, the following propositions can be drawn from Pyrenees, Crimmins and Graham Barclay Oysters: (a) The totality of the relationship between the parties is the proper basis for the determination of a duty of care. (b) The category of control that may contribute to the existence of a duty of care to exercise statutory powers includes control, generally, of any situation that contains within it a risk of harm to others. (c) A duty of care does not arise merely because an authority has statutory powers, the exercise of which might prevent harm to others. (d) The existence of statutory powers and the mere prior exercise of those powers from time to time do not, without more, create a duty to exercise those powers in the future. (e) Knowledge that harm may result from a failure to exercise statutory powers is not itself sufficient to create a duty of care. Applying those principles to the facts and relevant statutory provisions of the present case, Ipp JA concluded (at [141]–[145]): None of the specific exceptional categories identified in Sutherland Shire Council v Heyman are categories into which the circumstances of this case fall. [The plaintiff’s] argument, however, is that the State attracted a duty of care, as the circumstances of the case are analogous to those in Pyrenees, or in Crimmins. There was, undoubtedly, a power on the part of the State to direct Mr Hay’s employer … to take appropriate remedial steps to prevent the inhalation by Mr Hay of asbestos dust. But the power of the State in this respect and the degree of control exercised by [page 373] it differed significantly from the control exercisable by the Council in Pyrenees and the Authority in Crimmins. The State was not the sole entity with knowledge of the potential dangers of the asbestos dust on the power station site. [The building owner] and [the plaintiff] (and, presumably, [Hay’s employer]) had no less knowledge than the State. This fundamentally distinguishes this case from Pyrenees. The control exercised by the State in this case came nowhere near the extraordinary degree of control exercisable by the Authority in Crimmins. The two are not comparable. The State had no power to direct Mr Hay where to work, and did not direct Mr Hay to work in a transient and casual employment — factors regarded in Crimmins as being of great importance. …

Moreover, in this case, the State was empowered to regulate conduct in a situation where, in the words of Gummow and Hayne JJ in Graham Barclay Oysters, the field of endeavour was ‘populated by self-interested commercial actors who themselves possess some power to avert those risks’.

7.16 In Stuart v Kirkland-Veenstra (see 6.14 and 7.7), the High Court of Australia returned to the question of when there is a common law duty to exercise a statutory power. Two Victorian police officers saw a man sitting alone in a car in a secluded parking area. A hose ran from the exhaust pipe to the inside of the car but the engine was not running. The police officers questioned the man for about 15 minutes. He told them he had thought of committing suicide but had changed his mind. He appeared calm and rational. The police officers allowed him to leave. Later that day, he committed suicide. The man’s wife, the plaintiff, sued the police officers and the state of Victoria for the police officers’ failure to exercise the power they had under the Mental Health Act 1986 (Vic) s 10, to apprehend a person who appeared mentally ill if there were reasonable grounds for supposing that person was likely to commit suicide. In three separate judgments, all six judges of the High Court of Australia held that the police officers had no statutory power to apprehend the man under s 10 because they had formed the view that he did not appear to be mentally ill. The fact that someone contemplates or attempts suicide does not in itself mean that she or he is mentally ill. In obiter comments about whether and when a duty of care arises to exercise a statutory power, Gummow, Hayne and Heydon JJ said (at [113]–[114]): Evaluation of the relationship between the holder of the power and the person or persons to whom it is said that a duty of care is owed will require examination of the degree and nature of control exercised over the risk of harm that has eventuated, the degree of vulnerability of those who depend on the proper exercise of the relevant power, and the consistency or otherwise of the asserted duty of care with the terms, scope and purpose of the relevant statute. Other considerations may be relevant. In the present matter, as in a number of cases about the exercise of statutory power, it is the factor of control that is of critical significance. It was not the officers who controlled the source of the risk of harm to Mr Veenstra; it was Mr Veenstra alone who was the source of that risk. For the reasons that have been expressed in

connection with consideration of the value of personal autonomy, this factor is of predominant importance.

[page 374] (Mr Veenstra’s suicide occurred in 1999, which is why the High Court made no reference to the Victorian legislation described in 7.8 (category 2) and 7.17, which would apply if the situation were to occur now.) Conversely, where the defendant does have the statutory power to act, the nature and scope of that power may dictate whether the common law should impose a duty to exercise it. In Hunter and New England Local Health District v McKenna (2014) 253 CLR 270; 314 ALR 505 (see 6.22), the High Court of Australia held that a health authority owed no common law duty to detain a mentally ill man on the ground that he might pose a danger to the community, including in particular a friend who had taken the man to hospital. The Mental Health Act 1990 (NSW) s 20 required that a mentally ill person be released from detention unless the medical superintendent of the hospital formed the opinion that no other care of a less restrictive kind was appropriate and reasonably available. The High Court held that because the powers, duties and responsibilities of doctors and hospitals were prescribed by the Act, it would be inconsistent to impose on the hospital a common law duty to act in a different manner.

The common law supplemented by statute (category 2) 7.17 As we saw in 7.8, six of the eight Australian jurisdictions have enacted legislation that explains what factors should be taken into account when considering whether and when a public authority owes a duty to exercise its statutory powers. In the Australian Capital Territory, New South Wales, Queensland, Tasmania, Victoria and Western Australia:1 The following principles apply in deciding in a proceeding whether a public or other authority has a duty of care or has breached a duty of care:

(a) the functions required to be exercised by the authority are limited by the financial and other resources reasonably available to the authority for exercising the functions; (b) the general allocation of the resources by the authority is not open to challenge; (c) the functions required to be exercised by the authority are to be decided by reference to the broad range of its activities (and not only by reference to the matter to which the proceeding relates); (d) the authority may rely on evidence of its compliance with the general procedures and applicable standards for the exercise of its functions as evidence of the proper exercise of its functions in the matter to which the proceeding relates.

These principles apply to state or territory governments, departments or administrative units of those governments, local governments or local councils, [page 375] public authorities constituted by statute and individuals performing official public functions.2 To a large extent, they are a distillation of the principles developed at common law. 7.18 The legislation is intended to supplement, rather than to replace, the common law,3 so the common law principles continue to apply in those jurisdictions to the extent that they are not inconsistent with those listed in the statutes. In Roads and Traffic Authority (NSW) v Refrigerated Roadways Pty Ltd (2009) 77 NSWLR 360 at [388], Campbell JA (with whom McColl JA and Sackville AJA agreed) said this about the relevant provision in New South Wales: [Section] 42 presupposes the existence of the law of negligence — it applies ‘in proceedings for civil liability to which this Part applies’, and, in the course of such proceedings, ‘in determining’ whether a public or other authority has a duty of care, or ‘in determining’ whether the public or other authority has breached a duty of care. Section 42 is in the nature of a supplement or corrective to the pre-existing law of negligence, not a replacement for it or for any part of it.

7.19 Similarly, in Southern Properties (WA) Pty Ltd v Executive Director, Department of Conservation and Land Management (2012) 42 WAR 287; 189 LGERA 359; [2012] WASCA 79 at [90], McLure P of the Western

Australian Court of Appeal (with whom Buss JA agreed) said that the existence and scope of a duty of care ‘is not governed solely by the common law’, but ‘it is convenient to commence with the common law’. The court’s inquiry may not only ‘commence with the common law’, it may end there, too, even in jurisdictions that have passed the provision reproduced in 7.17. For example, in Southern Properties (WA) Pty Ltd, McLure P ultimately found no need to consider the Western Australian statutory provision, as she found that there was no duty under the common law principles. Similarly, in Regent Holdings Pty Ltd v Victoria [2013] VSC 601, Beach JA undertook an extensive analysis of the common law principles, holding that no duty was owed, before adding that the Victorian statutory provision ‘does not change the conclusion I have reached’ (at [236]). 7.20 Furthermore, if no evidence is adduced of the matters listed in the statutory provision, the court should proceed on the basis of the common law alone. In Bathurst Regional Council v Thompson (2012) 191 LGERA 182 at [46], [50], Hoeben JA of the New South Wales Court of Appeal (with whom Meagher JA and Tobias AJA agreed) said this about the New South Wales provision: Implicit in the appellant’s submission is an assumption that the trial judge was obliged to take into account those ‘principles’ even if no evidence of any of the matters in s 42 was adduced. That is not so. A simple reading of the section makes

[page 376] that clear. There has to be evidence of ‘the financial and other resources’ that are available to the authority and ‘the general allocation by it’ of those resources. There needs to be evidence as to the range of the authority’s activities. Without that basic material, a court has nothing upon which to apply the principles in the section … No evidence of any of those matters was adduced by the appellant. It follows that even if his Honour had found that s 42 applied to this case, the section had no practical application in the absence of some evidence with respect to the various subject matters referred to in it.

7.21 As well as the general provision quoted in 7.17, the Australian Capital Territory, New South Wales, Tasmania, Victoria and Western Australia (but not Queensland) have enacted a provision

approximately equivalent to factor (d) in Ipp JA’s summary of Heyman, Pyrenees, Crimmins and Graham Barclay Oysters in Amaca (see 7.15):4 The fact that a public or other authority exercises or decides to exercise a function does not of itself indicate that the authority is under a duty to exercise the function or that the function should be exercised in particular circumstances or in a particular way.

In Regent Holdings Pty Ltd v Victoria, Beach JA took the same view of the Victorian version of this provision as he did of the more general provision in 7.17 — namely, that it acted as a supplement to his consideration of the common law principles, and had nothing to add in the circumstances.

A precondition to recovery in New South Wales (category 3) 7.22 In 2003, New South Wales added an extra provision, s 43A, to its Civil Liability Act 2002 (NSW), which provides, in s 43A(3), that: [A]ny act or omission involving an exercise of, or failure to exercise, a special statutory power does not give rise to civil liability unless the act or omission was in the circumstances so unreasonable that no authority having the special statutory power in question could properly consider the act or omission to be a reasonable exercise of, or failure to exercise, its power.

A ‘special statutory power’ is a power ‘of a kind that persons generally are not authorised to exercise without specific statutory authority’: s 43A(2). 7.23 Section 43A does not provide the public authority with a defence or immunity to liability arising under the common law, but rather it states a precondition to liability in addition to the requirements of the common law. The effect of the provision was explained as follows by Whealy JA (with whom McColl JA agreed) in Warren Shire Council v Kuehne (2012) 188 LGERA 362; [2012] NSWCA 81 at [117]: (1) The language of s 43A states a precondition for the existence of civil liability in the context with which it is concerned. Once it is found or assumed, by

[page 377] reference to the pre-existing common law of negligence, that a duty of care exists and there has been a failure to exercise reasonable care, s 43A(3) imposes an additional requirement, beyond those of the common law, before liability can be established. (2) The origin and legislative history of s 43A make it plain that language modelled on that of Wednesbury unreasonableness was adopted from Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 with the intention of raising the bar for plaintiffs in proof of breach of duty of care by an authority in the exercise of a special statutory power. (3) Notwithstanding the difficulty of transposing the concept of Wednesbury unreasonableness, derived as it is from administrative law, to the law of negligence, the concept now has statutory force in s 43 and s 43A and is to be applied to an authority’s act or omission. (4) The words ‘could properly consider’ require a determination to be made from the perspective of the authority, but with an objective element. (As I see it, the objective element is particularly important in examining an allegation that the Council has negligently failed to exercise a power available to it.) (5) Although the concept of Wednesbury unreasonableness has been expressed in varying terms, some extreme, some more moderate, its transposition into the law of civil liability requires that the unreasonableness must be at a high level. The language of s 43A (‘could properly consider’ with the restraint of ‘could’ moderated by ‘properly’) necessarily requires questions of degree and judgment.

7.24 The concept of ‘Wednesbury unreasonableness’ is borrowed from administrative law, where it provides the standard for judicial review of administrative decisions made by government bodies. In Allianz Australia Insurance Ltd v Roads and Traffic Authority (NSW) (2010) 57 MVR 80; [2010] NSWCA 328, Giles JA considered how this administrative law concept might operate when transplanted into the law of torts via s 43A, and concluded (at [87]): Aronson sums it up in ‘Government Liability in Negligence’ [2008] 32 MULR 44 at 80 that ‘[o]nly the grossest unreasonableness will invalidate the exercise of a statutory discretion’. The learned author suggests that instead of transplanting Wednesbury unreasonableness ‘[i]t might have been more straightforward to draft the new standard simply as “gross negligence”’. I say nothing of that; in seeking to give content to the language of s 43A, however, a constant is that Wednesbury unreasonableness must be at a high level. The force of s 43A, in its use of language modelled on that of Wednesbury unreasonableness, lies in ‘could properly consider’, with the restraint of ‘could’ moderated by ‘properly’. Necessarily, questions of degree and judgment arise in both reasonableness and properness.

7.25 Section 43A clearly makes it extremely difficult to argue that a public authority in New South Wales is liable in tort for a failure to exercise its statutory powers. The next case contains an authoritative consideration of the standard to be applied in considering the effect of the section. [page 378] Key Case Curtis v Harden Shire Council (2014) 88 NSWLR 10 Facts: A fatal motor accident occurred in a roadwork zone where there was loose gravel on the road as a result of resurfacing works. The plaintiffs (the family of the driver who died) sued the shire council, claiming that it had negligently failed to erect signs warning of a slippery surface and/or limiting or reducing the speed limit. The defendant council relied on the Civil Liability Act 2002 (NSW) s 43A (among other things), arguing that it was not so unreasonable to put up warning signs that no council could have failed to do so. Issue: Did the council fail to live up to the reduced standard of care set by s 43A? Decision: The New South Wales Court of Appeal held that the defendant council was liable to the plaintiffs. Basten JA said (at [277]–[278], emphasis in the original): The final clause [of s 43A(3)] sets a standard. The standard is an act or omission that is ‘so unreasonable’ that no authority could ‘properly consider the act or omission to be … reasonable’. This is a curious form of expression: it is not that the act be so unreasonable that no reasonable authority could do the act, but it may perhaps be assumed that the reference to ‘no authority’ is a reference to ‘no authority acting reasonably’. That conclusion is supported by the reference to an authority which ‘could properly consider’ the act to be reasonable … The other awkwardness of expression is that the court is required to consider not whether it considers the act (to paraphrase) grossly unreasonable, but rather whether no authority properly considering the matter could consider it to be reasonable. This test has two aspects. First, the identification of the body to be satisfied as to the proper characterisation of the act or omission is not the court but another public authority. That is, it is like the test of apprehended bias in administrative law, which asks not whether the court might think that the decision-maker might not bring a fair and unbiased mind to the task, but whether a fair-minded lay observer might think that the decision-maker might not bring such a mind to the task. With apprehended bias, the identification of the holder of the opinion is understandable; with liability in tort, it is less clear. It means that the court must

view the matter through the eyes of a responsible public authority, having particular expertise and functions. Basten JA went on to emphasise that it is important to identify with some care the statutory power that should have been exercised. In the present case, that was not the general power to repair and maintain roads, but rather the specific power to put traffic control signs by the side of a road. There was no evidence to indicate that no road authority could properly have considered it appropriate to put up road signs. Basten JA said (at [284]): [T]he statutory test did not require the judge to form her own view about the matter, but rather required that she determine whether no road authority properly considering the selection of appropriate road signs could have adopted the solution adopted by Mr Stephenson, as the officer of the council. There was no evidence which, in express terms, supported such a conclusion.

A restriction on standing to sue (category 4) 7.26 The legislation in the Australian Capital Territory, New South Wales and Tasmania contains a specific provision that appears, on its face, to be much more [page 379] restrictive in effect than either the general provision in common law as summarised in Amaca (see 7.15):5

7.17

or the

(1) A public or other authority is not liable in a proceeding so far as the claim in the proceeding is based on the failure of the authority to exercise, or to consider exercising, a function of the authority to prohibit or regulate an activity if the authority could not have been required to exercise the function in a proceeding begun by the claimant. (2) Without limiting what is a function to regulate an activity for this section, a function to issue a licence, permit or other authority in relation to an activity, or to register or otherwise authorise a person in relation to an activity, is a function to regulate the activity.

In New South Wales and Tasmania, ‘function’ is defined to include ‘a power, authority or duty’.6 7.27

Like s 43A of the New South Wales Act (see

7.23–7.24),

this

provision borrows from administrative law principles. In effect, it appears to provide that the right to sue in tort is confined to those people who would have standing to sue for judicial review of administrative action by a public body. The view that this provision is concerned with standing to sue finds support in the following dictum of Whealy JA (with whom McColl JA agreed) in Warren Shire Council v Kuehne (at [150]): In my opinion, s 44 is concerned with the issue of standing, rather than the issue as to whether a particular plaintiff would succeed on the merits in proceedings instituted alleging failure of an authority to exercise or to consider exercising a function to prohibit or regulate an activity.

The administrative law of standing to sue is complicated and there are few circumstances in which public bodies can be compelled by courts or administrative tribunals to exercise a statutory power if they choose not to do so. For example, it seems very unlikely that the plaintiff in Pyrenees (see 7.12) could have brought legal proceedings forcing the shire council to take regulatory action in relation to the defective chimney, and it seems just as unlikely that the plaintiff in Crimmins (see 7.13) could have brought legal proceedings forcing the Australian Stevedoring Industry Authority to take steps to intervene in waterfront safety. If that is right, neither plaintiff would now be able to recover damages in the Australian Capital Territory, New South Wales or Tasmania. In effect, if the section applies, the right to damages in such cases has almost been removed altogether, although few cases have yet considered its application. However, the next case shows a willingness to read down the restrictive potential of the provision. [page 380] Key Case Bankstown City Council v Zraika (2016) 74 MVR 505 Facts: The plaintiff was allegedly injured in a collision between motor vehicles at an intersection. (He was an unborn child at the time of the accident in which he was

allegedly injured.) He sued the local council, among others, alleging that when it gave development approval for a factory complex near the intersection, it failed to impose a requirement that drivers entering the road from the factory complex should turn away from the intersection rather than towards it. The local council argued that s 44 insulated it from liability. Issue: Did the plaintiff have standing to sue the council despite the limits imposed by s 44? Decision: The New South Wales Court of Appeal held that the defendant council was liable to the plaintiff, notwithstanding s 44. The relevant ‘function’ of the council was the granting of development approval, not the possible imposition of conditions to that approval that might have regulated traffic flow. Leeming JA said (at [98]): Both as a matter of form and substance, there is a single decision by a council determining a development application. This was not a case where there was a failure to exercise or to consider exercising the function of determining the development application: the Council did so, favourably, although subject to conditions. On the view I take, that is sufficient to displace s 44.

What Duty Does a Public Authority Owe when it Exercises its Statutory Powers? Statutory amendments to the common law 7.28 The principles in the statutory provision reproduced at 7.17 apply in deciding whether a public authority has breached a duty of care, as well as in deciding whether it owes a duty. In the six jurisdictions that have enacted them, the statutory principles supplement the common law principles described below (see 7.33–7.37) in the same way that they supplement the principles relating to the existence of a duty: see 7.18–7.19. 7.29 The statutory precondition imposed by the Civil Liability Act 2002 (NSW) s 43A has the effect of ‘raising the bar for … proof of breach of duty’ to the very high level of ‘Wednesbury unreasonableness’: see 7.23. Thus, it effectively replaces the common principles described below (see 7.33–7.37) in New South Wales, because the very high standard of ‘Wednesbury unreasonableness’ must still be met even if the statutory authority failed to take reasonable care. For

that reason, the fact that New South Wales is one of the six jurisdictions considered in 7.28 is largely irrelevant, in practical terms. [page 381] 7.30 The statutory provision reproduced in 7.26 is concerned with standing to sue, so it has no impact on the question of what precautions a public authority should or should not take if it owes a duty of care: see 7.27. 7.31 The common law principles considered below (see 7.33–7.37) continue to apply in unmodified fashion in South Australia and the Northern Territory, and they provide the starting point for an analysis of breach in five of the six jurisdictions (New South Wales being the exception: see 7.29).

The common law 7.32 It might be thought that, if a public authority does owe a duty to do something rather than nothing, or if it does decide to exercise its statutory powers in a certain situation, then its conduct must always be judged according to the ordinary standard of reasonable care. However, as we have seen, it may be that the statutory authority has decided to exercise its statutory powers only in a limited way, or not to exercise them at all, because of a policy decision based upon the fact that it must perform its statutory functions with scarce resources. In Anns v Merton London Borough Council [1978] AC 728, the House of Lords distinguished between ‘policy’ and ‘operational’ decisions and actions, saying that, in general, liability could attach to the latter, but not the former. Similarly, in Heyman (see 7.11), Mason J suggested that the distinction between ‘policy’ and ‘operation’ is significant, at least in so far as it relates to breach of duty by statutory authorities in the exercise of their statutory powers, saying (at CLR 468–9; ALR 34–5): The standard of negligence applied by the courts in determining whether a duty of care has been breached cannot be applied to a policy decision, but it can be applied

to operational decisions. Accordingly, it is possible that a duty of care may exist in relation to discretionary considerations which stand outside the policy category in the division between policy factors on the one hand and operational factors on the other. … The distinction between policy and operational factors is not easy to formulate, but the dividing line between them will be observed if we recognise that a public authority is under no duty of care in relation to decisions which involve or are dictated by financial, economic, social or political factors or constraints. Thus budgetary allocations and the constraints which they entail in terms of allocation of resources cannot be made the subject of a duty of care. But it may be otherwise when the courts are called upon to apply a standard of care to action or inaction that is merely the product of administrative direction, expert or professional opinion, technical standards or general standards of reasonableness.

7.33 More recently, the usefulness of the policy/operational distinction has been doubted, at least in cases governed by the common law. Gummow J has said that the distinction is ‘not useful’ (Pyrenees Shire Council v Day (at CLR 393; ALR 195) and is ‘of dubious utility’: Vairy v Wyong Shire Council (2005) 223 CLR 422 at [86]. Hayne J has said that the distinction ‘may not always be useful’ (Crimmins v Stevedoring Industry Finance Committee (at CLR 101; ALR 75) and Callinan J has [page 382] said that it is not ‘convenient or satisfactory’ to ask whether a particular function of an authority relates to a matter of policy or executive action: Graham Barclay Oysters Pty Ltd v Ryan (at [321]). In contrast, Kirby J has said, ‘[a]lthough the distinction is far from perfect, it has some validity’: Pyrenees Shire Council v Day (at CLR 426; ALR 221). Gleeson CJ is the strongest recent supporter of the distinction, saying in Graham Barclay Oysters Pty Ltd v Ryan (at [12]– [13]): That distinction was never rigorous, and its validity and utility have been questioned. Even so, the idea behind it remains relevant in some cases, such as the present. [Gleeson CJ then quoted the passage from Mason J’s judgment in Heyman, quoted above in 7.32, and continued.] One of the reasons why matters of the first kind are inappropriate as subjects of

curial judgment about reasonableness is that they involve competing public interests in circumstances where, as Lord Diplock put it, ‘there is no criterion by which a court can assess where the balance lies between the weight to be given to one interest and that to be given to another’.

7.34 The concept of separation of powers underlies the idea that courts cannot or should not sit in judgment on ‘policy’ decisions that involve what Mason J in Heyman (see 7.32) called ‘financial, economic, social or political factors or constraints’. Such essentially political decisions are for the executive or legislative branches of government, not for the judiciary. That is what Gleeson CJ meant when he said in Graham Barclay Oysters that such decisions are ‘inappropriate as subjects of curial judgment about reasonableness’ (see 7.33). In Rowling v Takaro Properties Ltd [1988] AC 473 at 501, the Privy Council said the following about the policy/operational distinction: [T]his distinction does not provide a touchstone of liability, but rather is expressive of the need to exclude altogether those cases in which the decision under attack is of such a kind that a question whether it has been made negligently is unsuitable for judicial resolution, of which notable examples are discretionary decisions on the allocation of scarce resources or the distribution of risks.

Although this passage states frankly that some cases are ‘unsuitable for judicial resolution’, it provides no criteria for determining which cases fall into that category. Chesterman JA made that point in Meshlawn Pty Ltd v Queensland [2010] QCA 181 at [101], before stating (at [102]): There has been no attempt, that I have found, to describe what attributes governmental activity must have for the activity to be relevantly ‘unsuitable’. There is general agreement that ‘quasi-legislative activity of public authorities such as zoning prescriptions and … inter-governmental dealings’ are in that category. That point was made, and the authorities reviewed, by Gummow J in Pyrenees Shire Council v Day …

In Meshlawn itself, the question was whether the chief executive of Queensland’s Liquor Licensing Division had been negligent in refusing extended hours permits to nightclubs that had previously been granted such permits over [page 383]

a period of eight years. Chesterman JA held that it was not appropriate for a court to make a judgment about the reasonableness of such a decision, saying (at [107], [113]): Though neither judge nor arbitrator, the chief executive had to weigh options between two different courses of action each supported by different interests, private financial on the one part, and public, social and financial, on the other. The decision called for an exercise of judgment, based upon the evidence, assessing where, in the circumstances, that balance should be struck. … The nature of the discretionary judgment the chief executive must make, identifying and balancing conflicting interests, means the exercise of the power is unsuitable for judicial scrutiny. The existence of such a duty of care would be inimical to the impartial exercise of a power which must balance those conflicting and competing interests. It would provide an incentive to favour applicants, to avoid acrimonious and/or vexatious suits by powerful litigants.

It should be noted that McMurdo P and Fryberg J rested their decision in Meshlawn on the different ground that the chief executive had exercised her powers with reasonable care. Nevertheless, Chesterman JA’s analysis of the breach of duty question is the most detailed articulation to date of the reasons why some (‘policy’) decisions are regarded as being beyond judicial scrutiny, whereas other (‘operational’) decisions are judged according to the ordinary standards of reasonable care. 7.35 Despite the reservations expressed by members of the High Court in common law cases (see 7.33), Western Australia has enacted a ‘policy defence’ for public authorities (see Civil Liability Act 2002 (WA) s 5X): In a claim for damages for harm caused by the fault of a public body or officer arising out of fault in the performance or non-performance of a public function, a policy decision cannot be used to support a finding that the defendant was at fault unless the decision was so unreasonable that no reasonable public body or officer in the defendant’s position could have made it.

A ‘policy decision’ is defined to mean ‘a decision based substantially on financial, economic, political or social factors or constraints’, a phrase that obviously borrows heavily from Mason J’s judgment in Heyman: see 7.32; Civil Liability Act 2002 (WA) s 5U. 7.36

In the Australian Capital Territory, New South Wales,

Queensland, Tasmania and Victoria, two of the factors to be taken into account in determining the liability of public authorities are (see 7.17):7 (b) the general allocation of … resources by the authority is not open to challenge;

[page 384] (c) the functions required to be exercised by the authority are to be decided by reference to the broad range of its activities (and not only by reference to the matter to which the proceeding relates) …

These provisions do not enact the policy/operational distinction as clearly as the Western Australian provision does (see 7.35), but their overall effect is much the same. In Rickard v Allianz Australia Insurance Ltd (2009) 54 MVR 214; [2009] NSWSC 1115 at [152], Hoeben J said the statutory provision in 7.17 ‘implicitly invokes the policy/operation distinction in that budgetary allocations have frequently been characterised by the courts as policy matters which were not justiciable’. The provision makes it clear that, to use Mason J’s words in Heyman (see 7.32): ‘[B]udgetary allocations and the constraints which they entail in terms of allocation of resources cannot be made the subject of a duty of care.’ The next case is an example of a decision made on that basis at common law. Case Example McMullin v ICI Australia Operations Pty Ltd (1997) 72 FCR 1 Facts: The respondent manufactured and sold an insecticide called Helix, which was sprayed onto cotton crops. The insecticide contained a chemical (CFZ) that was bioaccumulative, with the result that it got into the body tissue of cattle that were subsequently slaughtered for meat. The meat was rejected. Many different claimants, including graziers, abattoir operators and meat exporters, sued the respondent. They also sued the states of New South Wales and Queensland, complaining that an official committee in each state had granted clearance for the use of Helix. Issue: Had the state committees acted negligently in granting clearance for the use of Helix? Decision: The Federal Court of Australia held that the claim against the two states failed. Wilcox J said (at 93):

I reach my conclusion because of the nature of the tasks upon which the two Committees were engaged when granting and extending clearance, and the nature of the decisions to register Helix under State law. I think all those decisions fall into the policy, rather than operational, area. Wilcox J said that, in deciding whether to grant or withhold clearance to Helix, the state committees had had to consider financial, economic, social and political factors (at 96). Wilcox J concluded (at 98): In my opinion, all the decisions concerning clearance, registration and extension of clearance were policy decisions. It was foreseeable that a negligent act or omission in relation to them might cause damage to persons whose cattle were affected by the subject chemical. That circumstance underlined the importance of the people concerned with the decisions acting in a careful and professional manner. However, because of the nature of the relevant decisions, it did not give rise to a duty of care to the cattle owners, enforceable by an action in negligence.

[page 385] 7.37 In Parramatta City Council v Lutz (1988) 12 NSWLR 293 (which, like Pyrenees (see 7.12), was a case about a fire that spread from a house that the local authority knew had previously caught fire), Kirby P said (at 309–10): Did the Council breach its duty of care by not ensuring, pursuant to its statutory powers, that the remains of the dwelling at 19 New York Street were demolished within a reasonable time and before the fire caused damage to Mrs Lutz? … The Council submitted that failure to enter the property at 19 New York Street and to demolish it was, in fact, a policy decision and therefore, in accordance with authority, that the delay was not to be regarded as a breach of its duty. Some authorities suggest that a public authority is not liable for damage arising out of a policy decision as opposed to an operational decision: see J G Fleming, The Law of Torts 6th ed (1983) at 145, 402. The principle appears to have been accepted by the High Court of Australia in Sutherland Shire Council v Heyman [(1985) 157 CLR 424; 60 ALR 1]. Assuming that this distinction is drawn by that law [sic], in the particular circumstances of the present case, I am of the opinion that it does not apply to provide the Council with immunity for a breach of its duty to Mrs Lutz. Any exercise of the powers conferred by s 317B of the Act necessarily involved a combination of policy and operational decisions. When a duty of care is found to exist, a failure to exercise a statutory power said to be relevant to the cause of negligence in the operational process is not to be excused merely because the ultimate decision to exercise the power may be classified as a policy one.

Another way of putting this point would be to say that some policy decisions are high-level ones involving the kind of political or social factors described by Mason J in Heyman (see 7.32), while others are low-level ones that are essentially administrative. The former are ‘true’ policy decisions, beyond review by the tort of negligence; the latter are not.

Highway Authorities 7.38 Until fairly recently, there was clear and longstanding authority for the proposition that statutory authorities were not liable for nonfeasance (ie doing nothing) in their role as highway authorities: see Buckle v Bayswater Road Board (1936) 57 CLR 259 and Gorringe v Transport Commission (Tasmania) (1950) 80 CLR 357. The justification usually given for the immunity was that it would be ruinous to impose on a highway authority a duty to take positive steps to keep roads under repair, given that there may be thousands of kilometres of roads within the authority’s jurisdiction (particularly in Australia). In Brodie v Singleton Shire Council (2001) 206 CLR 512; 180 ALR 145, the High Court of Australia held, by a majority of four to three, that Buckle and Gorringe should no longer be followed and that the liability of highway authorities should be subsumed under the general law governing the liability of public authorities. 7.39 Brodie’s case was soon reversed by legislation in every jurisdiction except the Northern Territory. The legislation restores the pre-Brodie immunity of highway [page 386] authorities for nonfeasance.8 A roads authority is not liable for harm arising from a failure to carry out road work (or to consider doing so) unless at the time of the alleged failure it had actual knowledge of the particular risk that resulted in the harm. Even in a case where this knowledge exists, the legislation states that a duty of care does not

arise just because of the knowledge; it also does not affect any standard of care that would otherwise be applicable. In such a case, liability would then be determined in the manner described in 7.7–7.37, with the relevant principles depending on the jurisdiction where the incident occurred: see, for example, Curtis v Harden Shire Council (2014) 88 NSWLR 10 (see 7.25), where the court applied the New South Wales provisions about liability of statutory authorities, including s 43A. ‘Carry out road work’ is defined broadly to include any activity connected with construction, erection, installation, maintenance, inspection, repair, removal or replacement of road work. 7.40 There is no specific legislation in the Northern Territory conferring immunity on a public authority in its capacity as a highway authority. Because the Northern Territory also has no general legislation regulating the liability of public authorities (see 7.8), the common law continues to govern, including Brodie: see 7.38. Problem 1 7.41 On 20 February 2017, the first known case of Acute Chronic Infectious Disease (ACID), involving a Canadian airline steward, was identified in Toronto, Canada. It gained immediate worldwide attention. From 20 February until 25 March, 125 individuals became ill with ACID: 17 died and 36 suffered cognitive damage; the remainder did not sustain long-term harm. During this period, ACID cases were identified only in Canada, Belgium and Namibia. On 25 March, the Global Health Organisation (GHO) reported on its website, Death and Disease Daily, that the ACID virus is spread when (i) an infected person sneezes and the droplets enter the mouth of a nearby person, or (ii) someone touches an object contaminated with ACID droplets and then touches her or his mouth. It reported that ACID’s spread can be contained by isolating ACID-infected persons in the hospital. They should not be discharged until it is certain they are symptom-free, at least three months after their breathing normalises. It also reported that only some sufferers responded to drug treatment. On 30 March, the Australian Foreign Affairs Department advised and comforted Australians by saying, ‘any planned travel to Canada and Namibia should be postponed’ and ‘no one in Australia has anything to worry about, because ACID has not taken hold on our sheltered shores’. Nevertheless, in response to media hysteria, the state/territory governments enacted the Public Health Isolation Act, which came into effect on 31 March. The Act stated: [page 387]

s 4: This act gives local authorities the power to protect public health. s 5: If a doctor suspects that a person has an infectious disease, including ACID, and that person might be a threat to the community because she or he refuses a doctor’s order to remain isolated in the hospital, the doctor must notify the local council’s Health Inspector. The inspector may order that person’s detention and isolation in hospital. Earlier that month, on 1 March, Paula Petulant had arrived in Daisy Bay (population 100,000) from Toronto. Paula was an exchange student studying law at Daisy Bay University, a private university. In her favourite subject, ‘Torts Tragedies’ (taught by Dr Dashing), Paula always sat near her pal, Pene, and Pene’s six-year-old daughter, Patsy. Pene brought Patsy to class whenever she could not arrange child care, even though university regulations prohibited this. On 1 April, despite feeling feverish, Paula came to class because she couldn’t stand the thought of missing out on what Dr Dashing had to say. As she began to suffer breathing difficulties, she was taken by Pene to see Dr Dire at Daisy Bay Hospital, a private hospital. Dr Dire admitted Paula to hospital, prescribing a four-week course of drug treatment. On 8 April, Paula was diagnosed with Australia’s first case of ACID. She responded well to drug treatment. On 1 May, feeling better, Paula told Dr Dire that she wanted to return to university and her part-time work. Dr Dire resisted. Agitated and anxious, Paula insisted on leaving. Frustrated, fed up and fatigued, Dr Dire said, ‘So be it: good riddance!’. Immediately after his altercation with Paula, Dr Dire went to Cupid’s Kitchen to enjoy a relaxing brunch. Returning to the hospital three hours later, Dr Dire suddenly remembered to phone Daisy Bay Council’s health inspector. He told the inspector that Paula had discharged herself, intent on going to university and work. The inspector soon found out where Paula lived, worked and studied. But he did not take any further steps to locate and isolate Paula, because her file ended up buried under a pile of documents on his desk, marked ‘urgent’. Earlier that week, the council had fired three health inspectors and hired two beach cleaners, in an attempt to make Daisy Bay Beach needle-free. This was in response to media hysteria about a child suffering a needle-stick injury on the beach (an enormously profitable tourist destination) and fears that the child might suffer HIV. On 2 May, Paula went to class. During the break, she asked Dr Dashing a few questions. She sneezed. A few infectious droplets fell onto Patsy’s drawing of a Torts Tragedy, which happened to be on Dr Dashing’s lectern. The drawing was returned to Patsy. A few hours later, Paula went to work. As she loaded trays with Cupid’s Kitchen’s chicken Kievs, she had a sneezing fit. Although she covered her mouth, some infectious droplets contaminated the Kievs — two of which were consumed by two of the Kitchen’s habitual diners, Pene and Patsy. A few hours later, Patsy collapsed, unable to breathe. Diagnosed with ACID, she sustained brain damage, which impaired her speech. Patsy sues the council. Advise Patsy and Daisy Bay Council with respect to the central liability issues that might arise, aside from causation and potential defences.

[page 388]

Discussion Arguments for Patsy 7.42 Section 4 of the Public Health Isolation Act (PHIA) gives the Daisy Bay Council (DBC) the general power to protect public health. Section 5 grants it the specific power to detain and isolate members of the community who have infectious diseases. However, it does not impose any statutory duty to do so. The viability of Patsy’s arguments will depend on where her claim is litigated (and where her harm occurred/where Daisy Bay is located). If her claim is brought in the Northern Territory or South Australia, she would argue, using only common law principles: in those jurisdictions, common law principles govern all aspects of Patsy’s claim. Patsy should be warned that the difficulties of establishing the duty to exercise powers using only common law principles, discussed below, are significant and should not be understated. That said, Patsy’s arguments are persuasive, as they are largely based on control and knowledge and the way in which those salient features have driven the results in the leading authorities. Even in the six jurisdictions with civil liability statutes that address the potential liability of public authorities, several aspects of their Acts are, to a large extent, a distillation of principles developed at common law. As Roads and Traffic Authority (NSW) v Refrigerated Roadways Pty Ltd explained, the legislation supplements the common law; it does not replace it. A similar sentiment was expressed by McLure P (with Buss JA’s agreement) in Southern Properties (WA) Pty Ltd v Executive Director, Department of Conservation and Land Management. If Daisy Bay is in the Australian Capital Territory, New South Wales, Queensland, Tasmania or Western Australia, Patsy’s claim will be governed by statutorily prescribed factors that help determine duty and breach issues: (i) the functions required to be exercised by the council are limited by the financial and other resources available to it; (ii) these functions are determined by reference to the broad range of activities the council undertakes; (iii) evidence of its compliance with general procedures and applicable standards for the exercise of its functions can be relied upon as evidence of the proper exercise of its functions; (iv) how its resources are allocated cannot be challenged. In Victoria, all these factors apply except for the last one: in that state, Patsy could challenge the general allocation of resources by the DBC, as this protection is not included in the Wrongs Act 1958 (Vic). However, it should be noted that this does not preclude the DBC from invoking an argument based on resource allocation, using common law principles (which appear to be similar). The effects, if any, of the statutory changes are discussed below, after a consideration of fundamental common law principles. In several cases, including Sutherland Shire Council v Heyman, Pyrenees Shire Council v Day and Graham Barclay Oysters Pty Ltd v Ryan, the High Court of Australia held that there is, in general, no common law duty on a statutory body to exercise a statutory power if no statutory duty has been imposed. Therefore, Patsy may wish to concede

that the DBC owed no prima facie duty to exercise its statutory powers to detain and isolate Paula and arguably employ more staff. However, Patsy would contend that there are circumstances where the statutory authority may be said to owe a duty to act and exercise its powers. She would argue that her case meets [page 389] the criteria used to determine when this duty should be imposed. The application of these principles to her case dictate a result similar to those reached in Pyrenees and Crimmins v Stevedoring Industry Finance Committee. The foundation on which this duty can be established, based on judgments in Pyrenees, Crimmins and Graham Barclay Oysters, all of which are discussed in Amaca Pty Ltd v New South Wales, embraces the relatively modern approach used by the High Court to establish duties of care in novel or contentious circumstances. As Graham Barclay Oysters makes clear, this is determined by an assessment of the ‘totality of the circumstances’ and the use of ‘salient features’, such as knowledge, control and vulnerability. Relatively more recently, in Stuart v Kirkland-Veenstra, Gummow, Hayne and Heydon JJ noted, in obiter, the factors that must be evaluated to determine if a duty of care is owed, with particular emphasis placed on control. Moreover, regardless of where Daisy Bay is located, it does not appear that the civil liability statutes add much to or change these criteria. The approaches used in Graham Barclay Oysters and Stuart, which must be followed, assist Patsy’s claim, although the cases are distinguishable in terms of results. In Graham, consumers of contaminated oysters (from Wallis Lake) contracted hepatitis A. They sued the council (among others), alleging negligence for failing to exercise statutory powers to prevent or reduce pollution in the lake. As the High Court stated, several factors are of special relevance when deciding whether or not an affirmative duty to exercise a statutory power can be imposed on a statutory authority. These relate to the power to protect the community from a particular risk and the degree of awareness the authority has of a specific risk to a specific individual. The more pronounced these factors, the easier it is to argue that the failure to exercise the power constitutes negligence. In Graham, the weakness of these factors did not justify a finding of the existence of a duty of care owed by the council to the consumers. By way of contrast, in Pyrenees, the council knew of a fire risk at a particular locale. It owed a duty of care and breached it by not exercising its powers to prevent the fire risk materialising. Similar knowledge was evident in Crimmins, such that liability was imposed. The same could not be said in Graham, on its facts. Patsy would contend that her circumstances are more closely aligned with those in Pyrenees and Crimmins, by comparison to Graham and Stuart. The DBC had knowledge of the specific risk of harm involving her situation, as that information was provided by Dr Dire to its health inspector. The DBC had knowledge that this risk posed serious health consequences and had the potential to escalate. It was clear that letting a person with ACID — who had been a patient in the hospital (and was not certified as symptomfree, contrary to the GHO’s advice) — wander all over the community, work in a

restaurant and attend a university, created a severe risk of potentially devastating harm, from which the whole community, including someone like Patsy, required protection. Patsy would argue that this case is factually unlike Graham, where McHugh J held that there was nothing in the council’s powers to justify a conclusion that its powers were given for the protection of oyster consumers or any other particular class. The DBC’s awareness of the danger and the particular risk to which Patsy was exposed satisfies the requirements that have to be met in order to impose the duty to exercise its statutory power — as outlined by the High Court in Graham, in the court’s interpretation of Pyrenees. [page 390] While there was a risk of harm to everyone living in Daisy Bay, there was a heightened and particularised risk to a limited class of persons — those with whom Paula had contact. Unlike Graham, here, the site of potential harm and information about who (likely) was most immediately at risk of the harm materialising were known to the DBC, through its health inspector and the notification by Dr Dire. The inspector knew that Paula had left the hospital, knew where she worked, knew where she studied, and knew where she lived. Patsy was a person specifically at risk, as she was in close proximity to Paula at university and at Cupid’s Kitchen. Patsy was certainly among a class of persons who were in particular danger: someone who sat in the vicinity of an infectious person and who ate food carried by the infected person. Indeterminacy is not a relevant concern in these circumstances. Control was also a particularly important feature in Stuart and Graham. The council in Graham exercised a far less significant degree of control over the risk of harm than was the case in Pyrenees. It did not exercise control over the source of the harm (the oysters). At most, it could monitor and, where necessary, intervene to protect the physical environment of areas under its administration. But this did not amount to control over all risks of harm that could occur as a result of commercial businesses’ conduct. Similarly, in Stuart, the High Court held that the officer did not have control over the source of the risk of the harm — the deceased. In Stuart, like Graham, the absence of control was decisive in denying liability. Using this reasoning, but distinguishing those results, Patsy should argue that the DBC had the requisite control over the risk of harm of an ACID spread, such that it had a duty to exercise its statutory powers. This is similar to the situation in Pyrenees, where the council held a significant and special measure of control over the danger from fire at the relevant premises. It had entered upon the exercise of its statutory powers of fire prevention. Further, it knew of and was responsible for the continued existence of the risk of fire. Here, too, the DBC had the power to restrict the spread of the disease, by virtue of its recently granted detention and isolation powers. Factually, the DBC’s degree of control here is significant, as was the case in Pyrenees and Crimmins, and unlike Graham and Stuart. The case of Hunter and New England Health District v McKenna is unhelpful here: in that case, the Mental Health Act at issue required that mentally ill persons be released from detention unless the view was formed by the hospital’s medical superintendent that no other care of a less restrictive kind was

appropriate and reasonably available. In the instant scenario, there was an opportunity to exercise control over Paula and certainly no requirement to release her in these circumstances. If Patsy’s claim is brought in Queensland, Victoria or Western Australia, their civil liability statutes do not appear to say anything particularly noteworthy that would affect this aspect of her claim. In Southern Properties (WA) Pty Ltd, McLure P found no need to consider the Western Australian statutory provision, as she found that there was no duty using common law principles; in Regent Holdings Pty Ltd v Victoria, Beach JA held that no duty was owed, adding that the Victorian statutory provision did not change his conclusion. Relying on Bathurst Regional Council v Thompson, Patsy would however press the need for the DBC to adduce evidence of its financial and related resource allocation concerns for the principles in the relevant statutory sections to be triggered and applied by the court. [page 391] However, if Daisy Bay is in the Australian Capital Territory, New South Wales or Tasmania, Patsy should concede that her chances of succeeding are lower than would be the case elsewhere. Additional provisions in these three jurisdictions, which borrow from administrative law principles, have a potentially restrictive effect: see Civil Law (Wrongs) Act 2002 (ACT) s 112; Civil Liability Act 2002 (NSW) s 44; Civil Liability Act 2002 (Tas) s 41. Patsy’s right to sue in tort is only available to her if she would have standing to sue for judicial review (Warren Shire Council v Kuehne). Patsy would rely on the fact that the court in Bankstown City Council v Zraika showed a willingness to read down the restrictive potential of the provision, finding that the defendant council was liable to the plaintiff despite s 44, based on its view that the council’s relevant function was the granting of development approval. Patsy would urge the instant court to take a similarly narrow or conservative view of when these sections apply. She must be able to show that she could have brought an administrative law proceeding, demanding that the DBC exercise its statutory powers to regulate by compelling Paula’s detention and isolation. Patsy may argue that the failure to exercise the power here was ‘capricious’ or brought about by ‘inexcusable bureaucratic inefficiency’, and that the DBC owed her a duty to exercise its powers to hire more staff to contain the spread of infectious diseases, rather than redeploy funds and staff elsewhere — to clean the beach. It was inexcusable for the DBC to prefer funding a beach-cleaning project, intended to increase and preserve the tourist trade (when all that is required is a warning to the public to wear thongs or shoes), over the decision to protect the whole community from a potentially fatal public health hazard. Patsy should note, however, that the prospects of success in arguing that she has the right to seek a public law remedy and compensation for damage she has suffered are not high. In New South Wales, Patsy will no doubt have to contend with additional arguments based on s 43A of that state’s Civil Liability Act and the potentially powerful effect of its provision. Its use could prove problematic, if what was involved under the Act involved a ‘special statutory power’. In Warren Shire Council v Kuehne, the court held that before

liability can be established, s 43A imposes an additional requirement beyond those of the common law. It is built upon Wednesbury unreasonableness, with an objective element. Despite requiring unreasonableness to be ‘at a high level’, as Allianz Australia Insurance Ltd v Roads and Traffic Authority noted, questions of degree and judgment come into play. Patsy would note that the reasoning and result in Curtis v Harden Shire Council demonstrate that s 43A does not necessarily thwart her claim. As in Curtis, she would argue that viewing the case through the lens of the reasonable public authority having particular expertise and functions, no authority responsible for controlling epidemics by detaining and isolating patients could properly have acted in the same way as the DBC. Therefore, despite the difficulties presented by this additional hurdle, Patsy would maintain that the gross negligence required by the Wednesbury principle was met: the fact that the defendant did not detain and isolate Paula, who had a potentially fatal contagious disease, was negligence of the grossest kind. The inspector’s lack of care, allowing Paula’s file to get buried, is negligence ‘at a high level’. The DBC may argue in response that its choice of priorities and how it decided to exercise its powers involved policy decisions that cannot give rise to common law [page 392] liability. This is reflected in various ways under the Civil Liability Acts in the Australian Capital Territory, New South Wales, Queensland, Tasmania and Victoria, where the functions required to be exercised by the authority are decided by reference to the broad range of its activities. If Daisy Bay is in Western Australia, the governing provision of the Civil Liability Act 2002 (WA), s 5X, clearly prescribes the effect of a ‘policy decision’ in terms that borrow heavily from Mason J in Sutherland Shire Council v Heyman. The overall effect is similar, ostensibly offering defendants like the DBC protection from liability for decisions characterised as ‘policy’. If Daisy Bay is in the Northern Territory or South Australia, this aspect of the claim would be governed by Mason J’s judgment and subsequent judicial interpretations. To sum up, the statutes essentially reflect the general common law position in this regard. It is correct to say that DBC has a wide discretion with respect to how it chooses its priorities and spends its funds. In Heyman, Mason J stated that a decision based on budgetary factors should be characterised as a policy decision, and should not give rise to liability in negligence, because common law liability could arise only in respect of operational decisions. It should be noted that several judges have rejected or criticised this dichotomy (Gummow J in Pyrenees and Vairy v Wyong Shire Council; Hayne J in Crimmins; and Callinan J in Graham), although it is acknowledged that it survives (albeit with little enthusiasm). While Meshlawn Pty Ltd v Queensland is interesting for Chesterman JA’s exposition of these issues, the case was decided on other grounds. As was noted above, the essence of the dichotomy has been endorsed in most Civil Liability Acts, with specific reference in some statutes about the inability to challenge resource allocation decisions. In Rickard v Allianz Australia Insurance Ltd, Hoeben J said the statutory provision ‘implicitly invokes the policy/operation distinction in that

budgetary allocations have frequently been characterised by the courts as policy matters which were not justiciable’. Patsy will try to argue that this dichotomy does not frustrate her claim, even under the Acts, since the relevant decision in the present case is operational in nature and not one based on policy. Using the language of the various Civil Liability Acts, she would argue that the present decisions do not involve the general allocation of resources and are not affected by reference to the broad range of DBC’s activities. While it may be conceded that the DBC made policy decisions to fund the beach-cleaning program (to maintain tourism), its decision not to provide additional health inspectors, but actually reduce the number in the context of this imminent epidemic, with its enormous potential to cause great harm in the community, might fall within what Kirby P in Parramatta City Council v Lutz called a policy decision ‘in the operational process’ — that is, a lower level, essentially operational decision about how to implement the policy. The decision to replace one type of employee with another, in order to respond to a vague risk of harm rather than the immediate one presented by Paula’s (and who knows how many others’) contagious condition, was operational in nature and outside the protection Mason J and the statutes offer to public authorities. Arguably, it was not dictated by resource concerns but by media hysteria about HIV. Furthermore, here, the health inspector did in fact have the actual file before him that detailed the specific risk of harm. It simply required a response: finding Paula, taking her to hospital, detaining her, and isolating her. This was an operational decision, for which there is a duty of care. In this case, the health inspector simply exercised a [page 393] power in a negligent fashion, as Patsy’s file was buried among others on his desk. Therefore, there is no reason why the DBC should not be liable for negligence at an operational level. What occurred here was not so much a policy decision about resource allocation as it was a careless use of the remaining resources (one health inspector) with responsibility to respond to a potential public health crisis (miserly as this resource response may have been). Finally, Patsy could attempt to characterise the DBC’s actions as misfeasance, not nonfeasance, by contending that its failure to provide enough competent staff to properly address the spread of this potentially fatal disease was not an omission. Patsy could argue that when a public authority begins to exercise its statutory powers with respect to a particular subject matter, it places itself in a relationship to others which imports a common law duty to take care, which is to be discharged by the continuation or additional exercise of those powers. When the council in Pyrenees began to exercise its fire-prevention powers in relation to a building that posed a fire hazard, it placed itself under a duty to continue to exercise those powers for the protection of the inhabitants and neighbours of that building. Similarly, here, the DBC (through its health inspector) began to exercise its statutory powers to have Paula detained and isolated. Because the health inspector commenced the process of responding to Dr Dire’s notification that Paula was on the loose, the DBC (through the inspector) placed itself into a relationship with members of the community

who were prone to being affected by her irresponsible, dangerous behaviour, as a disease-carrying threat to public health. This included those at Daisy Bay University, as well as Cupid’s Kitchen’s customers — such as Dr Dashing, Pene and, indeed, Patsy. DBC therefore imported a common law duty, which could only be discharged by the provision of a sufficient number of competent health inspectors, meticulously responding to urgent and imminent public health risks. The failure amounted to misfeasance, not nonfeasance. Therefore, it should give rise to liability in negligence. Arguments for Daisy Bay Council 7.43 The Daisy Bay Council (DBC) was not under a statutory duty to Patsy or anyone else living in Daisy Bay. It merely had the general statutory power to protect public health under the Public Health Isolation Act (PHIA) and, under s 5, the power to detain and isolate infectious members of the public, restricting their movements. In six jurisdictions — the Australian Capital Territory, New South Wales, Queensland, Tasmania, Victoria and Western Australia — the Civil Liability Acts include provisions that essentially reflect the common law (which applies in the Northern Territory and South Australia). In these six jurisdictions, the statutes spell out factors that must be considered when assessing whether the DBC owed a duty and whether it has been breached, including the functions required to be exercised by the authority, the broad range of its activities and, in all but Victoria, how it allocates its resources. In fact, all these factors reflect principles that have evolved judicially, so in a sense all jurisdictions are relatively similar in this regard. The DBC would agree with Patsy that common law principles remain relevant in all jurisdictions. The Civil Liability Acts supplement rather than replace the common law (Roads and Traffic Authority (NSW) v Refrigerated Roadways Pty Ltd and McLure P (with Buss JA’s agreement) in Southern Properties (WA) Pty Ltd v Executive Director, Department of Conservation [page 394] and Land Management). However, there are additional statutory provisions in the Australian Capital Territory, Tasmania and especially New South Wales that strengthen DBC’s arguments (considered below). In principle, courts have long held that the common law should not impose a duty to exercise a statutory power if parliament did not see fit to impose a duty by statute. If parliament had intended to impose a duty, it would have drafted the section at issue accordingly, rather than expressing the provision as a power, and leaving it to the court to impose the (alleged) duty. In Sutherland Shire Council v Heyman, Pyrenees Shire Council v Day, Crimmins v Stevedoring Industry Finance Committee, Graham Barclay Oysters Pty Ltd v Ryan (all discussed by the New South Wales Court of Appeal in Amaca Pty Ltd v New South Wales) the High Court of Australia has held that, in general, statutory authorities do not owe a common law duty to exercise their statutory powers. Thus, prima facie, the DBC should not be held to be under a common law duty to employ additional health inspectors to restrict the community’s contact with potentially infectious persons, nor is it under a duty to detain and isolate people like Paula. The circumstances in which a duty can exist in this context also were explored by the High

Court in Stuart v Kirkland-Veenstra. Further, in Hunter and New England Health District v McKenna, the defendant health authority was held to not owe a common law duty of care to members of the public with respect to the release of a mentally ill patient, even though he might pose a danger to the community; the authority’s conduct was governed by an Act that prescribed the detention of mentally ill persons as a matter of last resort, despite a power to release them. The DBC would concede that a common law duty to exercise a statutory power may arise in some rare cases, despite the general rule to the contrary. This was noted in Graham, where the High Court emphasised what is required to impose this common law duty. In Graham, the court distinguished Pyrenees and Crimmins, outlining the criteria or salient features necessary to impose this rather exceptional duty. It refused to find a duty, where consumers of contaminated oysters who contracted hepatitis A sued the council (and state) for not exercising statutory powers to prevent or reduce the pollution in Wallis Lake. As the High Court noted, the council’s general powers to protect public health, which included surveys of sanitary facilities near the lake and water testing, did not go so far as to specifically protect consumers of oysters or any other particular class of persons. The same may be said here. There is nothing in the general powers of the PHIA (s 4) or the specific power in s 5 to show that Patsy had any right to protection. She was not within a class of persons that could be said to have the sort of relationship with the DBC necessary to justify what is contended here — the imposition of a duty to exercise a statutory power. The DBC can argue that, as in Graham, its power concerning public health protection is in fact too far removed from the harm Patsy suffered. In Stuart, the degree and nature of control exercised over the risk of harm was an important feature in determining whether or not a duty was owed. The court held that this risk of harm was not in fact under the officers’ control; indeed, it was under the control of the deceased — his personal responsibility. Graham also highlighted the importance of the degree of control exercised by the council to differentiate the outcomes in Pyrenees and Crimmins from that which they reached in Graham. In [page 395] Graham, there was a far less significant degree of control over the risk of the harm that eventuated than was the case involving the fire danger in Pyrenees and lung disease in Crimmins. In Graham, the council did not have significant or sufficient control over the source of the harm — the oysters. Patsy faces similar difficulties as the consumers in Graham. The control that was exercisable by the DBC concerned the health of the public — the whole community of 100,000 people. This is not the type of case that justifies finding this duty. Although the DBC had the ability to detain and isolate infectious persons, the DBC would argue that additional inspectors would not have had the necessary effect of limiting the danger that eventuated, seeing that Dr Dire’s efforts proved futile. This was a case involving a headstrong patient, Paula, who was released by the doctor who already had actual control over her. Dr Dire should have withstood Paula’s insistence on leaving, as he was the one who could have exerted effective control over her. Any purported

control, supposedly exercisable by the DBC, was fractured and insufficient to meet the requirements of the salient features approach. This is especially the case when combined with Patsy’s lack of vulnerability (noted below). Here, those at risk, like Pene and Patsy, should have done all that they could to avoid the risk of harm, seeing that they themselves knew of Paula’s condition and her premature and misguided reconnection with the community. The DBC would attempt to argue that despite her age and supposed lack of maturity, Patsy was not vulnerable in the legal sense, in that she could have protected herself from this risk of harm. She and her mother knew of Paula’s illness; they presumably knew Paula had discharged herself prematurely; Patsy sat near Paula at university and ate at the restaurant where Paula served food. In conjunction with the other salient features, the absence of vulnerability points away from finding an (alleged) relevant duty to exercise a statutory power. Stuart also endorsed vulnerability as significant to the court’s assessment of whether a duty is owed in this context. (‘Vulnerability’ as a salient feature is considered in detail in Chapters 5 and 12.) The DBC also would argue that the imposition of a duty is precluded here because it made a policy decision. This contention presents Patsy with significant hurdles in all jurisdictions. The DBC will be able to convincingly argue that its choice of priorities and how it decided to exercise its powers are policy decisions that cannot give rise to common law liability. The Civil Liability Acts in the Australian Capital Territory, New South Wales, Queensland, Tasmania and Victoria prescribe that the functions required to be exercised by the authority are to be decided by reference to the broad range of its activities. This reflects the common law position whereby defendants like DBC should be protected from civil suit with respect to policy choices. If Daisy Bay is in Western Australia, the governing provision, the Civil Liability Act 2002 (WA) s 5X, is even clearer. Common law principles protect the DBC if it is in the Northern Territory or South Australia. Although the common law policy/operational distinction has been rejected outright or criticised by Gummow J in Pyrenees and Vairy v Wyong Shire Council, Hayne J in Crimmins, and Callinan J in Graham, other judges, such as Gleeson CJ in Graham and McHugh J in Crimmins, endorse the relevance of this distinction in appropriate cases. The overall effect of the common law approach and statutory reflections of this approach is similar: the DBC is protected from liability, as the provisions draw upon Mason J’s long-endorsed view at common law, in Sutherland Shire Council v Heyman. [page 396] The DBC would argue that there is no doubt that its decisions must be characterised as high-level policy decisions. They are not merely low-level ones that are essentially administrative. Its decisions here are ‘true’ policy decisions, beyond review by the tort of negligence (unlike what was at issue in Parramatta City Council v Lutz). The DBC’s decisions were dictated by what Mason J in Heyman called ‘financial, economic, social or political factors or constraints’ (and reflected in most Civil Liability Acts, albeit in various ways). The DBC made deliberate policy decisions to preserve tourism by addressing and responding to a risky situation (perhaps similarly dangerous to that

involving Paula), which had been the subject of hysteria: potential needle-stick injuries on Daisy Bay Beach, and the contraction of HIV. The DBC decided to divert funds to combat the syringe risk, away from the risk posed with respect to contracting ACID (a remote one, as indicated by the Australian Foreign Affairs Department). The rationale for finding that some decisions are beyond judicial scrutiny was considered by Chesterman JA in Meshlawn Pty Ltd v Queensland. In a sense, these are political decisions that cannot form the basis of a civil complaint in negligence. Aside from the somewhat political nature of the decisions, there were the budgetary constraints as well, referred to above. In the Australian Capital Territory and Tasmania, the Civil Liability Acts state that the general allocation of resources cannot be challenged. The court should not, through tort, make the DBC liable for failing to do more, such as hiring more health inspectors to detain and isolate infectious persons, when the risk of harm in Australia was so low (once again having regard to the warning from the Australian Foreign Affairs Department). The decision to not employ more health inspectors — or more accurately, to redeploy funds to be able to hire beach cleaners — was discretionary in nature, involving difficult choices concerning how to use scarce resources. These decisions about priorities with respect to the expenditure of money are an inescapable part of the functioning of a body such as the DBC, and cannot give rise to common law liability for the reasons given by Mason J in Heyman. Even in jurisdictions without Civil Liability Acts prohibiting this type of challenge, common law principles have the same effect. Although Patsy and other Daisy Bay inhabitants may disagree with the DBC’s policy and how it allocated scarce resources, the discretion to make such decisions was conferred on the DBC by the legislature. Any complaint or grievance should be by virtue of the ballot box, not civil litigation. As Lord Hoffmann pointed out in Stovin v Wise, the very fact that parliament has conferred a discretion must be some indication that the policy of the Act conferring the power was not to create a right to compensation. It would be inappropriate for the court to decide, for example, that more money ought to have been spent on health inspectors compared to the money spent on preventing the spread of HIV by cleaning the popular beach — sweeping it free of dirty needles and syringes. The DBC had justifiably established other priorities for the expenditure of its limited funds. In the Australian Capital Territory, New South Wales and Tasmania, an extra provision in each Act (Civil Law (Wrongs) Act 2002 (ACT) s 122; Civil Liability Act 2002 (NSW) s 44; Civil Liability Act 2002 (Tas) s 41) has enhanced the DBC’s legal position, as a result of which it will be particularly difficult for Patsy to succeed if Daisy Bay is in one of these jurisdictions. The powerful way in which these provisions can thwart her claim involves her standing to sue. This view was expressed by Whealy JA (with whom McColl JA agreed) in Warren Shire Council v Kuehne. Although the [page 397] court in Bankstown City Council v Zraika read down the provision in the New South Wales statute, there is no basis to similarly take such a narrow approach on these facts. This is not one of those limited circumstances where a public body can be compelled to exercise a statutory power where it has decided not to do so.

The additional restrictions imposed by these Acts require Patsy to demonstrate that she could have brought an administrative law proceeding, demanding that the DBC exercise its statutory powers to compel Paula’s detention and isolation. The DBC would argue that Patsy is unable to meet this hurdle, because the DBC’s decision not to employ more staff as health inspectors was well reasoned, when there were arguably greater serious risks elsewhere to which DBC responses and resources were needed (at Daisy Bay Beach). The DBC decided to serve the competing interests for which it was also responsible. The risk of needle-stick injuries is a serious one, also requiring a resourceintensive response. This is not, for example, the kind of case where one could argue that one segment of the community was favoured over another, financially, in some sort of arbitrary manner. Aside from the difficulties presented to Patsy by the standing provisions in the Australian Capital Territory, New South Wales and Tasmania, an additional section in the New South Wales statute makes her ability to successfully claim in that state particularly difficult. DBC would rely upon s 43A of that state’s Civil Liability Act, convincingly arguing that this case involves a ‘special statutory power’. As the court held in Warren Shire Council v Kuehne, s 43A builds upon Wednesbury unreasonableness, requiring what may be described as ‘gross negligence’ to be established before liability can be imposed. This ‘high-level’ carelessness cannot be found on these facts, even if the objective element and questions of degree and judgment are taken into account, as noted in Warren Shire Council v Kuehne and Allianz Australia Insurance Ltd v Roads and Traffic Authority. Although the court in Curtis v Harden Shire Council considered the New South Wales section and held that the council did not live up to the reduced standard of care, in this case, seen through the eyes of a responsible public authority with particular functions and expertise, evidence can be adduced to show that a resource-poor council could have acted in a manner similar to the DBC. While Patsy may attempt to characterise the inspector’s conduct with the buried file as grossly negligent, it arguably does not even meet the standard of ‘normal’ carelessness. At most, it may amount to inadvertence. Clearly, his workload was enormous as were the demands made on his time, having regard to the fact that three health inspectors had been fired earlier that week and they (presumably) had not been replaced. Finally, Patsy may attempt to argue that the DBC’s failure to employ more health inspectors to detain and isolate potentially infectious individuals from interacting with the members of the public was an act of misfeasance, not nonfeasance. On the other hand, the DBC can argue that, in fact, it had not embarked upon any positive action that specifically brought it into a relationship with Patsy (unlike one way in which Pyrenees has been characterised). The DBC will argue that it had not done anything to exercise its powers in relation to isolating Paula in the same way that the defendant council in Pyrenees had exercised its statutory powers in relation to the building that eventually caught fire. The fact that an inspector was in a position to potentially detain Paula had nothing to do with Patsy. This is a simple case of nonfeasance. [page 398] If anything, it is Dr Dire who should be held responsible, for having let Paula leave the

hospital and for having waited several hours before contacting the health inspector. Or, perhaps, Paula herself should be held responsible, as she left the hospital despite efforts to stop her; she knew the risk she presented to others. Indeed, Patsy (through her mother, Pene) ought to have known of the risk to their health as a result of being in contact with Paula, both at university and at Cupid’s Kitchen. Perhaps it is all their fault …

Problem 2 7.44 Devil’s Peak, located near Echo Point Nature Reserve, is renowned for its breathtaking cliff-side views, revealing a marvellous panorama overlooking the seaside as well as Calamity Cove, a resort adjacent to wondrous Angel Bay. Because of Devil’s Peak’s popularity as a premier tourist attraction, hordes of visitors park their cars to stare at the glorious sunsets and enjoy the gastronomic delights of Satan’s, the nearby bistro. Local conservationists have for many years unsuccessfully lobbied the Devil’s Peak Authority (DPA) to restrict access to the cliff-side area because of their concern that the tourist trade was causing environmental damage, including erosion of the peak’s massive sandstone cliffs. To protect this fragile and unique resource, the conservationists pleaded with the DPA to (i) employ additional environmental rangers who could limit the crowds at Devil’s Peak to 50 visitors at one time and (ii) close Satan’s. The Land Preservation Act (LPA) enumerates the DPA’s powers, including the general power to ‘conserve the natural beauty of the area’. Section 28 gives the DPA power ‘to protect the environment by limiting public access to popular attractions’. Responding to the conservationists’ concerns, the DPA asserted that it did not have the funds necessary to employ extra staff to monitor the site, since the bulk of its annual budget had already been allocated elsewhere. It did, however, agree to assign its currently employed rangers to randomly check Devil’s Peak every few days, to make sure that the native flora and fauna were not damaged by the crowds. The DPA also was in the process of implementing a new fire prevention program in Echo Point as well as launching Calamity Cove’s rather costly Peak and Point Virtual Discovery Tour. This interactive nature show, which incorporated the latest in computer animation, was intended to bring additional tourist dollars to the area. One particularly sunny spring Sunday in early November, throngs of tourists and locals visited Devil’s Peak to view the sunset over Angel Bay. Suddenly and without warning, the ground underneath began to crumble; a massive landslide followed; Satan’s and its occupants plummeted to the town below, blanketing Calamity Cove with boulders, rock, rubble and debris. Among the many lawsuits emerging from this disaster is a test case instituted by Pandora’s Palace, a Calamity Cove guest house that was destroyed in the catastrophe. Advise Pandora’s Palace and the DPA.

[page 399]

Further discussion 1. Does the policy/operational dichotomy serve any useful purpose? Do you agree with Gummow J’s comments in Pyrenees Shire Council v Day that this classification is not useful? 2. Do you agree with the High Court of Australia’s reasoning in Stuart v Kirkland-Veenstra? Are notions of personal responsibility convincing when one is concerned with individuals who are suicidal? Is this the same as ‘vulnerability’? (See Chapters 5, 6 and 8.) 3. Having regard to the decision in Graham Barclay Oysters Pty Ltd v Ryan, were the statutory interventions from 2002 to 2003, affecting litigation against statutory authorities, necessary? 4. Do you think other states and territories should follow the lead of New South Wales by enacting provisions similar to s 43A of the Civil Liability Act 2002 (NSW)? 5. What causation arguments would arise in Patsy’s claim if she were to get over duty and breach hurdles? 6. Recall Problem 2 in Chapter 2: one night, Phoenix, a student, was assaulted on the unlit pathway in Global Gardens, owned by Aspirationville College of the Arts. Assume that the college was constituted by the Aspirationville College of the Arts Act, which gives the college a power, but no duty, to put up lighting around the campus. If the college had planned to light the pathway, but had abandoned these plans because it had exceeded its budget by developing several virtual reality apps for use by the Department of Screen Studies, would this affect Phoenix’s claim?

Further reading

Aronson M, ‘Government Liability in Negligence’ (2008) 32 Melbourne University Law Review 44. Balkin R P and Davis J L R, ‘Duty of Care’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 7. Barker K, Cane P, Lunney M and Trindade F, ‘Negligence: Two Applications’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 11. Bell-James J and Barker K, ‘Public Authority Liability for Negligence in the Post-Ipp Era: Sceptical Reflections on the “Policy Defence”’ (2016) 40 Melbourne University Law Review 1. Bonython W E and Arnold B B, ‘When Statutory Powers Distract: Involuntary Detention and Treatment Laws, and Liability for Harm’ (2015) 43 Monash University Law Review 552. [page 400] Carroll E, ‘Wednesbury Unreasonableness as a Limit on the Civil Liability of Public Authorities’ (2007) 15 Tort Law Review 77. Concord T, ‘Public Authority Liability and the Heteronomy of Torts Law’ (2013) 21 Torts Law Journal 16. Jhaveri S, ‘Constructing a Framework for Assessing Public Authority Liability in Negligence: The Role of Public Law Norms, Private Law Norms and Policy Arguments’ (2011) 19 Tort Law Review 3. Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Particular Negligence Situations’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 7. Watson G, ‘Section 43A of the Civil Liability Act 2002 (NSW): Public Law Styled Immunity for the Negligence of Public and Other Authorities’ (2007) 15 Torts Law Journal 153. Weeks G, ‘A Marriage of Strangers: The Wednesbury Standard in Tort

Law’ (2010) 7 Macquarie Journal of Business Law 131. —, ‘Private Law Litigation against the Government: Are Public Authorities and Private Actors Really “the Same”?’ (December 2010) University of New South Wales Faculty of Law Research Series 2010, Working Paper 68. Wilberg H, ‘Defensive Practice or Conflict of Duties? Policy Concerns in Public Authority Negligence Claims’ (2010) 126 Law Quarterly Review 420. —, ‘In Defence of the Omissions Rule in Public Authority Negligence Claims’ (2011) 19 Torts Law Journal 159. Yew G C K, ‘Finding Common Law Duty of Care from Statutory Duties: All Within the Anns Framework’ (2016) 24 Tort Law Review 14.

1

2

3 4

5 6 7

8

Civil Law (Wrongs) Act 2002 (ACT) s 110; Civil Liability Act 2002 (NSW) s 42; Civil Liability Act 2003 (Qld) s 35; Civil Liability Act 2002 (Tas) s 38; Wrongs Act 1958 (Vic) s 83 (NB: only the first, third and fourth criteria apply); Civil Liability Act 2002 (WA) s 5W. The definitions vary a little from jurisdiction to jurisdiction. See Civil Law (Wrongs) Act 2002 (ACT) s 109; Civil Liability Act 2002 (NSW) s 41; Civil Liability Act 2003 (Qld) s 34; Civil Liability Act 2002 (Tas) s 37; Wrongs Act 1958 (Vic) s 79; Civil Liability Act 2002 (WA) s 5U. That is specifically stated in the Victorian legislation: see Wrongs Act 1958 (Vic) s 82. Civil Law (Wrongs) Act 2002 (ACT) s 114; Civil Liability Act 2002 (NSW) s 46; Civil Liability Act 2002 (Tas) s 43; Wrongs Act 1958 (Vic) s 85; Civil Liability Act 2002 (WA) s 5AA. Civil Law (Wrongs) Act 2002 (ACT) s 112; Civil Liability Act 2002 (NSW) s 44; Civil Liability Act 2002 (Tas) s 41. Civil Liability Act 2002 (NSW) s 41; Civil Liability Act 2002 (Tas) s 37. Civil Law (Wrongs) Act 2002 (ACT) s 110(b), (c); Civil Liability Act 2002 (NSW) s 42(b), (c); Civil Liability Act 2003 (Qld) s 35(b), (c); Civil Liability Act 2002 (Tas) s 38(b), (c); Wrongs Act 1958 (Vic) s 83(b) (NB: this corresponds to para (c) in the quoted text; para (b) of the quoted text does not appear in the Victorian statute). Although New South Wales is on this list, its inclusion is rendered largely redundant by Civil Liability Act 2002 (NSW) s 43A: see 7.23 and 7.29. Civil Law (Wrongs) Act 2002 (ACT) s 113; Civil Liability Act 2002 (NSW) s 45; Civil Liability Act 2003 (Qld) s 37; Civil Liability Act 1936 (SA) s 42; Civil Liability Act 2002 (Tas) s 42; Road Management Act 2004 (Vic) ss 102–103; Civil Liability Act 2002 (WA) s 5Z.

[page 401]

8 Economic Loss Objectives After completing this chapter, you should: — understand the reasons for the courts’ aversion to recognising a duty of care not to cause purely economic loss; — have a working knowledge of the factors that the courts take into account in determining whether to impose a duty to take reasonable care in the making of a statement; — understand whether and when a disclaimer of liability is effective to exclude liability for a negligent misstatement; — understand the principles used to determine whether a duty of care is owed to persons other than the immediate recipient of a statement; — have a working understanding of how the concept of the plaintiff’s vulnerability can be used as a common thread uniting most, and perhaps all, of the factors considered in relation to the existence of a duty to take care in making statements; — have a working knowledge of the circumstances in which an Australian court will recognise liability for purely economic losses caused by negligent acts; — understand what ‘vulnerability’ means in this context; — understand the concept of ‘transferred loss’ and how it alleviates the courts’ traditional concerns about indeterminate liability for purely economic losses; — have some sense of the position in other common law countries in relation to purely economic loss caused by negligent acts.

Key cases — Barclay v Penberthy (2012) 246 CLR 258; 291 ALR 608 — Caltex Oil (Australia) Pty Ltd v The Dredge ‘Willemstad’ (1976) 136 CLR 529; 11 ALR 227 [page 402] — Esanda Finance Corp Ltd v Peat Marwick Hungerfords (Reg) (1997) 188 CLR 241; 142 ALR 750 — Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465 — Mutual Life and Citizens’ Assurance Co Ltd v Evatt (1968) 122 CLR 556; [1969] ALR 3 (HCA) (on appeal (1970) 122 CLR 628; [1971] AC 793 (PC)) — Perre v Apand Pty Ltd (1999) 198 CLR 180; 164 ALR 606 — San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979 (1986) 162 CLR 340; 68 ALR 161 — Shaddock & Associates Pty Ltd v Parramatta City Council (No 1) (1981) 150 CLR 225; 36 ALR 385 — Tepko Pty Ltd v Water Board (2001) 206 CLR 1; 178 ALR 634 — Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515; 205 ALR 522

Introduction 8.1 Purely economic losses have always posed special problems for the law of negligence. A ‘purely’ economic loss is one that does not arise from damage to the plaintiff’s own property or person. The fundamental problem is that economic losses can be passed on from

one person to another, in a way that personal injuries cannot. As a result, a single act of negligence may cause economic loss to many different people, as the effect of that act of negligence reverberates through the economy. For example, if my ship negligently spills a large quantity of a dangerous chemical into the river, the resulting pollution may affect nearby oyster beds. The government may also place restrictions on the catching of shrimp and fish, for fear that they may now be harmful to human health if eaten. Fishing boats will be unable to make their usual catch, and will have no source of income until the government embargo on fishing is cancelled. Fish processors (canneries, freezing plants, and so on) will lose their supply of fish to be processed and they, too, will suffer loss. Seafood restaurants in the area will have to get their supplies from further away, making their prices more expensive. The increased cost of seafood and the public’s negative perception of the possibility of pollution will be bad for the restaurants’ business. Waiters and kitchen staff may be laid off work, or be given reduced hours. Tourists will no longer want to visit the beaches, and hotels and bed and breakfasts in the region will have reduced numbers of visitors. Beachfront shops will have fewer customers. 8.2 In this example, the negligence of my ship caused physical damage to the property of only one person, the owner of the oyster beds (assuming that the oysters are not growing wild). The same act of negligence caused purely economic losses to a wide range of people, and in some cases, those losses were effectively passed on from one person to another — from the fishing boats to the fish processors to the seafood restaurants to the restaurant staff, for example. If I were to be held [page 403] liable to all those who suffered loss, my single act of negligence would expose me to widespread and perhaps crippling liability. For that reason, it used to be the case that recovery of damages for purely

economic losses caused by negligence was simply not allowed. The law responded to the problem of indeterminate liability by denying liability altogether, because it was difficult to find concepts that would allow recovery only by those most closely affected, without opening the door wide to all claimants. There is still no easy answer to that question. Should a deck hand on an idle fishing boat be allowed to recover for lost wages in this example, but a restaurant worker not? Why? What principled basis can be found for drawing a line between recovery and non-recovery? 8.3 The blanket denial of liability continued until the latter part of the 20th century, when two great cases broke new ground by allowing recovery of damages for purely economic losses caused by negligence. The first of those cases was Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465, which was concerned with purely economic losses caused by negligent misstatements: see 8.6. The second case was Caltex Oil (Australia) Pty Ltd v The Dredge ‘Willemstad’ (1976) 136 CLR 529; 11 ALR 227, which was concerned with purely economic losses caused by negligent acts: see 8.32. In both cases, the court sought to state restrictive principles of liability that would allow recovery by some, but not all, of those who suffer purely economic loss. Those restrictive principles in negligent act cases are different from those in negligent misstatement cases.

Liability for Negligent Misstatements Causing Purely Economic Loss Introduction 8.4 It is ironic that liability for negligent misstatements causing purely economic loss was recognised before liability for negligent acts causing purely economic loss, because there is a second factor that enhances the fear of indeterminate liability in the case of negligent misstatements. It was described as follows by Lord Pearce in Hedley Byrne at 534:

Words are more volatile than deeds. They travel fast and far afield. They are used without being expended and take effect in combination with innumerable facts and other words. Yet they are dangerous and can cause vast financial damage.

8.5 The ‘volatility’ of statements means that if liability for purely economic losses caused by negligent misstatements were to be based solely on reasonable foreseeability of loss, the potential liability of defendants would be enormous. In considering the liability of accountants for purely economic losses caused by their negligent misstatements, Cardozo CJ of the Court of Appeals of New York said, in an oft-quoted dictum from Ultramares Corp v Touche (1931) 174 NE 441 at 444: If liability for negligence exists, a thoughtless slip or blunder, the failure to detect a theft or forgery beneath the cover of deceptive entries, may expose accountants

[page 404] to a liability in an indeterminate amount for an indeterminate time to an indeterminate class.

8.6 As noted in 8.3, until 50 years ago, the courts’ solution to this fear of indeterminate liability was simply to deny liability for negligence in making statements. If a plaintiff had suffered a purely economic loss as a result of relying on a statement made by a defendant, she or he could recover damages only if the defendant had been guilty of fraud: see Derry v Peek (1889) 14 App Cas 337; Candler v Crane Christmas & Co [1951] 2 KB 164. The position did not change until 1963, when the following case established that in certain circumstances a defendant might owe a duty of care in making statements. Key Case Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465 Facts: The plaintiffs were a firm of advertising agents, who placed advertising orders on television and in newspapers for their clients, Easipower. The plaintiffs paid for the advertisements themselves, on the basis that they would later be reimbursed by

Easipower. Before placing the orders, the plaintiffs asked their bank to get a credit rating for Easipower from the defendants, who were Easipower’s bankers. The defendants replied that Easipower was ‘quite good for its engagements’, but stated that this reference was given ‘without responsibility’. Relying on this reference, the plaintiffs placed and paid for the advertisements. Easipower failed to reimburse the plaintiffs, and went into liquidation. The plaintiffs sued the defendants, alleging that their losses had been caused by the defendants’ negligence in giving Easipower a favourable credit reference. Issue: Did the defendants owe the plaintiffs a duty to take reasonable care in making statements about Easipower’s creditworthiness? Decision: The House of Lords held that the defendants were not liable, because their credit reference had been given ‘without responsibility’. However, each member of the court stated, obiter, that the defendants would have been liable in negligence in the absence of this disclaimer. Lords Morris and Hodson said (at 503 per Lord Morris; at 514 per Lord Hodson): [I]f in a sphere in which a person is so placed that others could reasonably rely upon his judgment or his skill or upon his ability to make careful inquiry, a person takes it upon himself to give information or advice to, or allows his information or advice to be passed on to another person who, as he knows or should know, will place reliance upon it, then a duty of care will arise.

8.7 Hedley Byrne (see 8.6) did not lay down a single test for the existence of a duty of care in making statements. Instead, several factors were identified as being relevant, and it was emphasised that different factors would have different weight in different types of case. The Hedley Byrne principles were first adopted in Australia in Mutual Life and Citizens’ Assurance Co Ltd v Evatt (1968) 122 CLR 556; [1969] [page 405] ALR 3 (HCA); [1971] AC 793 (PC), which is considered below: see 8.14. The various factors considered in the paragraphs that follow are not a checklist of requirements for the existence of a duty of care. Each factor may, or may not, be necessary or sufficient to give rise to a duty, depending on all the circumstances of the case. 8.8

In practice, claims based on an allegation of negligent

misstatement are often coupled with parallel claims based on an allegation of breach of the Australian Consumer Law, s 18 (formerly the Trade Practices Act 1974 (Cth) s 52), which prohibits ‘misleading or deceptive conduct’ (in ‘trade or commerce’). Because the focus of this book is on the principles of the law of torts, the parallel statutory claim will not be considered in this chapter. Readers should, however, be aware of its practical importance in cases where the plaintiff complains that she or he has suffered economic loss as a result of a statement made by the defendant. In Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357; 270 ALR 204 at [5], French CJ and Kiefel J said this about the statutory cause of action: Its frequent invocation, in cases to which it is applicable, reflects its simplicity relative to the torts of negligence, deceit and passing off.

In the same case, Heydon, Crennan and Bell JJ observed (at [99]): Proof of the statutory claim will almost invariably be less onerous for a plaintiff than proof of negligence on the same facts. Liability for misleading conduct under the statute is strict and it follows that a corporation may act reasonably and yet engage in conduct that is misleading or deceptive.

Reliance and reasonable reliance 8.9 No statement can cause loss unless and until it is relied upon. The defendant cannot be liable for the plaintiff’s loss if the plaintiff did not in fact rely on the defendant’s statement. In a sense, then, the plaintiff contributes to her or his own loss by relying on the statement made by the defendant. If that reliance is not reasonable in the circumstances, it is not reasonable to expect the defendant to compensate the plaintiff for any losses suffered as a result. Conversely, if it is reasonable for the plaintiff to rely on the defendant’s statement rather than trusting her or his own judgment, then it is (or may be) reasonable to require the defendant to compensate the plaintiff. Thus, while reliance in fact is an essential element in establishing causation, reasonable reliance is an essential element in establishing the existence of a duty of care. 8.10

In Mutual Life and Citizens’ Assurance Co Ltd v Evatt (at CLR 571;

ALR 12), Barwick CJ expressed the requirement of reasonable reliance in the following terms: [T]he speaker must realize or the circumstances be such that he ought to have realized that the recipient intends to act upon the information or advice in respect of his property or of himself in connexion with some matter of business or serious consequence. Of course, utterances in the course of social intercourse with no thought of legal consequence could not satisfy such a condition.

[page 406] Further, it seems to me that the circumstances must be such that it is reasonable in all the circumstances for the recipient to seek, or to accept, and to rely upon the utterance of the speaker. The nature of the subject matter, the occasion of the interchange, and the identity and relative position of the parties as regards knowledge actual or potential and relevant capacity to form or exercise judgment will all be included in the factors which will determine the reasonableness of the acceptance of, and of the reliance by the recipient upon, the words of the speaker.

8.11 A majority of the High Court of Australia used Barwick CJ’s formulation of the concept of reasonable reliance in the following case. Key Case Tepko Pty Ltd v Water Board (2001) 206 CLR 1; 178 ALR 634 Facts: Companies owned or controlled by one of the plaintiffs (Mr Neal) owned rural land. They decided to have the land rezoned and subdivided for development. One of the companies obtained a bank loan. Before getting the required development approvals from the local council, the companies had to arrange for the land to be connected to the water supply at their own expense. The Water Board did not usually provide developers with estimates of the cost of connection, but after many inquiries by or on behalf of Mr Neal, it estimated the total cost of connection to be about $2.5 million. Because of the high cost of water connection, the bank decided that the proposed development was not economically viable. It appointed a receiver to Mr Neal’s companies. The development did not go ahead, and the land was eventually sold off to repay the loan, at far below the amount it would have been worth if it had been subdivided. The Water Board later found out that the total cost of water supply would have been much less than $2.5 million. The companies sued the Water Board, alleging that they had suffered substantial losses as a result of the Board’s negligence in estimating the connection costs. Issue: Did the Water Board owe a duty to Mr Neal and his companies to make an

accurate assessment of the cost of connection to the water supply? Decision: By a majority of four to three, the High Court of Australia held that the Water Board did not owe a duty to Mr Neal and his companies. After quoting the passage from Barwick CJ’s judgment in Evatt reproduced at 8.10, Gleeson CJ, Gummow and Hayne JJ said (at [49]): [T]he circumstances here were not such as to make it reasonable for Mr Neal to rely upon the ‘ball-park’ figure to meet the Bank’s demand for a costings estimate. The identity and relative position of the parties were such that the relationship between the Board and Mr Neal was one in which the Board plainly was a reluctant participant; the Board did not wish to give Mr Neal information and it resisted giving it until eventually it ‘caved in’. In that difficult situation Mr Neal, at all material times, had access to expert advice, which he utilised. These circumstances and the provisional nature of the estimate eventually provided in the letter of 21 November made it unreasonable to posit a duty upon the Board in respect of the use Mr Neal made of the estimate in his dealings with the Bank.

[page 407] 8.12 As the Tepko case (see 8.11) illustrates, the reasonableness of the plaintiff’s reliance on the defendant’s statements will depend on all the circumstances of the case, including the context in which the advice was given. For example, in Mohr v Cleaver [1986] WAR 67, a Full Court of the Supreme Court of Western Australia held that an accountant did not owe a duty to take reasonable care in giving investment advice over the telephone, because the recipients of the advice had merely asked the accountant for an ‘“off-the-cuff” or kerb stone opinion’ (at 72 per Burt CJ), and had not made it clear that they were seeking considered advice. In the circumstances, the plaintiffs had not acted reasonably in relying on the advice. In Shaddock & Associates Pty Ltd v Parramatta City Council (No 1) (1981) 150 CLR 225; 36 ALR 385 (see 8.15), the High Court of Australia also held (among other things) that no duty of care arose in respect of information given over the telephone because of the informality of the occasion. In Chew v Amanatidis [2009] SASC 334, a Full Court of the Supreme Court of South Australia held, by a majority, that no duty arose in relation to statements made in respect of a scheme that promised interest

payments upwards of 25 per cent for a $100,000 investment. Gray J called this (at [42]) ‘a most unusual transaction … not an ordinary business transaction’, before continuing: It is difficult to characterise the transaction as having a serious business purpose when regard is had to the Judge’s findings about the ludicrous nature of the returns. A moment’s thought by a person experienced in business or, for that matter, anybody with a modicum of commonsense would lead to the inevitable conclusion that the proposed investment was a preposterous proposal. A person proceeding with such a transaction would, it might be expected, have been propelled by greed. Having regard to its lack of any commerciality, the transaction could scarcely be described as a business transaction. Having regard to Mr Amanatidis’ years of business experience, this was not an occasion on which one could reach a conclusion that there had been reasonable reliance.

8.13 Conversely, in some cases, the reasonableness of the plaintiff’s reliance is so obvious that it may be assumed. For example, in Pullen v Gutteridge Haskins & Davey Pty Ltd [1993] 1 VR 27, the Full Court of the Supreme Court of Victoria held that where the defendant is a professional person and the plaintiff is the defendant’s client, it is not necessary to plead and prove reliance in order to establish the requisite relationship to give rise to a duty of care.

‘Special skill’ 8.14 One factor that is clearly significant in determining whether it was reasonable for the plaintiff to rely on the statement made by the defendant is the presence or absence of expertise on the defendant’s part. If the defendant is, or professes to be, an expert in the field in which she or he is giving information or advice, and the plaintiff is not, then there are strong grounds for saying that it would be reasonable for the plaintiff to rely on the defendant’s expertise rather than trusting in her or his own judgment. Accordingly, ‘special skill’ on the part of the defendant has always been regarded as relevant to the question of the existence of a duty of care. [page 408]

Key Case Mutual Life and Citizens’ Assurance Co Ltd v Evatt (1968) 122 CLR 556; [1969] ALR 3 (HCA) (on appeal (1970) 122 CLR 628; [1971] AC 793 (PC)) Facts: The plaintiff sought investment advice from the defendant, an insurance company. The company in which he intended to invest was a co-subsidiary of the company from which he sought the advice. The insurance company negligently advised that its co-subsidiary was a sound investment, which it was not. Acting on that advice, the plaintiff invested in the company and lost his money. He sued the defendant insurance company, claiming that its negligent advice had caused his loss. Issue: Did the defendant insurance company owe the plaintiff a duty to take reasonable care in advising him about whether its co-subsidiary was a sound investment? Decision: The High Court of Australia held, by a majority, that the defendant insurance company did owe the plaintiff a duty to take care in giving advice: (1968) 122 CLR 556; [1969] ALR 3. The majority held that the fact that the defendant was not in the business of giving investment advice did not affect the existence of a duty to take reasonable care in giving such advice. Barwick CJ said (at CLR 574; ALR 14): [I]n my opinion, the elements of the special relationship to which I have referred do not require either the actual possession of skill or judgment on the part of the speaker or any profession by him to possess the same. His willingness to proffer the information or advice in the relationship which I have described is, in my opinion, sufficient. The defendant appealed to the Privy Council which held ((1970) 122 CLR 628; [1971] AC 793), by a majority of three to two, that the defendant insurance company did not owe the plaintiff a duty because it did not have, nor had it professed to have, special skill in the giving of investment advice.

8.15 The decision in Evatt’s case (see 8.14) meant that ‘special skill’ on the part of the defendant was not merely one of the factors affecting the question of reasonable reliance on the part of the plaintiff, but was a separate requirement in itself. In effect, this meant that liability for negligent misstatements was confined to those who were in the business of giving information or advice. The decision was never popular, and English courts declined to follow it: see Howard Marine and Dredging Co Ltd v A Ogden & Sons (Excavations) Ltd [1978] QB 574. In the next case, the High Court of Australia appeared to have decided that Evatt’s case should no longer be followed.

Key Case Shaddock & Associates Pty Ltd v Parramatta City Council (No 1) (1981) 150 CLR 225; 36 ALR 385 Facts: The plaintiff company intended to purchase land for redevelopment. Its solicitor telephoned the defendant council to inquire whether there were any road [page 409] widening proposals that would affect the land. He was told that there were not. Later, the solicitor sent a form to the council, asking again whether any road widening proposals affected the land; the council returned the form without any indication that there were any relevant road widening proposals. The plaintiff company bought the land. In fact, the council had approved road widening proposals affecting the land, which affected its value. The plaintiff sued the defendant council, alleging that its loss had been caused by the council’s negligent advice that there were no road widening proposals affecting the land. Issue: Did the defendant council owe the plaintiff a duty to take reasonable care in response to its inquiries about the road widening proposals? Decision: The High Court of Australia held that the defendant council did owe the plaintiff a duty of care, and had breached that duty. All five judges stated that they preferred the view expressed by Barwick CJ in the High Court in Evatt’s case, that ‘special skill’ is not a requirement in itself, but is merely a factor affecting the question of reasonable reliance. Mason and Aickin JJ did so as part of the ratio of their decision, holding that Evatt should not be followed in Australia. Gibbs CJ and Stephen J disapproved of Evatt in obiter, because each took the view that the defendant council did have ‘special skill’ with respect to the information sought, and so would owe a duty under either of the views expressed in the Privy Council in Evatt. The fifth judge was Murphy J, who said (at CLR 256; ALR 409) that there was ‘no justification for adhering to the error expressed by the Privy Council’ in Evatt’s case. However, Murphy J also said (at CLR 256; ALR 409): For the purpose of this appeal, it is enough to hold that liability extends to those whose profession or business it is to give advice or information, whether gratuitously or not.

8.16 Murphy J’s comment that there was no justification in following the ‘error’ in Evatt seemed to group him with Mason and Aickin JJ, providing a majority in Shaddock for the proposition that the decision

of the Privy Council in Evatt should no longer be followed in Australia.1 A majority of the High Court of Australia took that view of Shaddock in San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979 (1986) 162 CLR 340 at 356; 68 ALR 161 at 170. So did a Full Court of the Supreme Court of Victoria in Norris v Sibberas [1990] VR 161, the Federal Court in Chiarabaglio v Westpac Banking Corporation (1989) ATPR ¶40-971 (affirmed on other grounds (1991) ASC ¶56-040), Gilmour J in Propell National Valuers (WA) Pty Ltd v Australian Executor Trustees Ltd (2012) 202 FCR 158 at [110] and Buchanan J in Brewer v AAL Aviation Ltd [2016] FCA 93 at [100]– [108]. Similarly, in Tepko Pty Ltd v Water Board (at [47]) (see 8.11), Gleeson CJ, Gummow and Hayne JJ said that Barwick CJ’s judgment ‘regained vitality’ after the reconsideration of Evatt in Shaddock. In Geju Pty Ltd v Central Highlands Regional [page 410] Council [2016] QSC 279 at [58], McMeekin J cited Shaddock as authority for the following proposition: It is now well established that a public body which in the exercise of its public functions follows the practice of supplying information which is available to it more readily than to other persons, whether or not it has a statutory duty to do so, is under a duty to those whom it knows will rely upon it in circumstances in which it is reasonable for those to do so, to exercise reasonable care that the information given is correct. [Emphasis added.]

Request 8.17 In most cases, the plaintiff will have requested the information or advice given by the defendant. However, the existence of a request is neither necessary nor sufficient for the existence of a duty of care. In San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979 (at CLR 356–7; ALR 170), Gibbs CJ, Mason, Wilson and Dawson JJ said:

The existence of an antecedent request for information or advice certainly assists in demonstrating reliance, which is a cornerstone of liability for negligent misstatement. However, such a request is by no means essential, though it has been suggested that instances of liability for misstatement volunteered negligently will be ‘rare’. … The maker of a statement may come under a duty to take care through a combination of circumstances or in various ways, in the absence of a request by the recipient.

8.18 In Mbakwe v Sarkis [2009] NSWCA 330, the New South Wales Court of Appeal held that a professional financial adviser owed his client a duty of care in relation to financial advice that fell outside the scope of the agreement under which the client had retained the adviser. Although that advice had been volunteered by the adviser, the court held that the defendant’s position as the plaintiff’s financial adviser and their continuing relationship led to the conclusion that the defendant owed a duty in relation to volunteered advice. Liability for volunteered statements is considered in greater detail below (see 8.26–8.27), in the context of liability to parties other than the immediate recipient of the information or advice.

Financial interest 8.19 It has been suggested that if the defendant stands to gain financially if the plaintiff relies on the statement, that is sufficient in itself to give rise to a duty of care: see, for example, Evatt (at CLR 642; AC 809). In Presser v Caldwell Estates Pty Ltd [1971] 2 NSWLR 471 at 493, Mason JA said: There may be circumstances in which the existence of a financial interest in the adviser may supply an element which will result in the imposition of a duty to take care where, but for that interest, no such duty would be imposed.

8.20 There is, however, no reported case in which the existence of the possibility of financial gain to the defendant has been sufficient in itself to give rise to a duty of [page 411] care. In Presser’s case itself (see

8.19),

and in Norris v Sibberas, the

defendants were real estate agents, who gave advice to potential purchasers of property. Although the defendants received a commission on each successful sale, in neither case did the court hold that this possibility of personal profit was sufficient in itself to give rise to a duty of care. In O’Leary v Lamb (1973) 7 SASR 159, the defendant’s financial interest was taken into account as one of several factors giving rise to a duty of care. More recently, in Chew v Amanatidis (at [93]), White J (dissenting) cited Evatt and Presser (see 8.19) as authority ‘for the view that if the speaker stands to gain financially from the recipient’s reliance on the statement that may be sufficient in itself to establish a duty of care’. Although the defendant in Chew’s case had some possibility of personal profit from the transaction in question, neither member of the majority of the Full Court of the Supreme Court of South Australia thought this sufficient to give rise to a duty of care, and even White J in dissent did not seem to regard this factor as conclusive in itself.

Disclaimers of liability and assumption of responsibility 8.21 Some of the statements made in Hedley Byrne (see 8.6) seemed to suggest that ‘assumption of responsibility’ was either a requirement in all cases, or that it would always be sufficient in itself to give rise to liability. The more modern view in Australia is that it is merely one factor to be considered, perhaps now to be explained in terms of the plaintiff’s vulnerability. In Australian Executor Trustees Ltd v Propell National Valuers (WA) Pty Ltd [2011] FCA 522 at [182], [184] (affirmed on appeal (2012) 202 FCR 158), Barker J said: What is clear, however, is that in Australia there is no special category of liability known as ‘assumption of liability’. That particular expression seems to owe itself most directly to the speech of Lord Devlin in Hedley Byrne at 528–9, where his Lordship said that there could be a duty to take care in word as well as deed in the case of a relationship which was ‘equivalent to contract’, that is, ‘where there is an assumption of responsibility in circumstances in which, but for the absence of consideration, there would be a contract’. … [I]n Perre [v Apand Pty Ltd] … McHugh J suggested that ‘reliance’ and ‘assumption of responsibility’ are merely indicators of a plaintiff’s ‘vulnerability to harm’ from a defendant’s conduct, and it is the concept of vulnerability rather than these

evidentiary indicators which is the relevant criterion for determining whether a duty of care exists.

The recent trend to consider all of the duty factors in terms of the plaintiff’s vulnerability is considered further in 8.29. 8.22 The significance of ‘assumption of responsibility’ as a factor is linked to the fact that the defendant may exclude liability by disclaiming responsibility for any statements that she or he makes. In Hedley Byrne itself (see 8.6), the House of Lords held that the defendants were not liable to the plaintiffs, despite their negligence in giving advice about Easipower’s creditworthiness, because that advice was given ‘without responsibility’. [page 412] 8.23 Formerly, it was thought that disclaimers of responsibility were effective because liability for negligent misstatements was based on an assumption of responsibility by the defendant: see 8.21. According to that view, any disclaimer of responsibility would automatically be effective, because it would simply mean that the defendant had not assumed responsibility for her or his statements and, thus, that no duty of care arose. For example, in Hedley Byrne, Lord Reid said that a reasonable person, knowing that her or his skill and judgment were being relied on, would have three choices: to say nothing, to give an answer with a clear qualification that she or he accepted no responsibility for it, or to answer without qualification. If the person chose the third course, Lord Reid said (at 486), she or he must be taken to have assumed responsibility for taking care in the giving of information or advice. In contrast, in Evatt (at 570), Barwick CJ said: The duty of care, in my opinion, is imposed by law in the circumstances. Because it is so imposed, I doubt whether the speaker may always except himself from the performance of the duty by some express reservation at the time of his utterance. But the fact of such a reservation, particularly if acknowledged by the recipient, will in many instances be one of the circumstances to be taken into consideration in deciding whether or not a duty of care has arisen and it may be sufficiently potent in some cases to prevent the creation of the necessary relationship. Whether it is so or

not must, in my opinion, depend upon all the circumstances of and surrounding the giving of the information or advice.

8.24 Under Barwick CJ’s view in Evatt’s case, a disclaimer of responsibility might have no effect where the other circumstances of the case indicate that there should be a duty, notwithstanding the existence of the disclaimer. The next case provides an example. Case Example Derring Lane Pty Ltd v Fitzgibbon (2007) 16 VR 563 Facts: The plaintiff bought a commercial property for an agreed price ‘plus GST’. The seller of the property engaged the defendant to make a valuation of the property for the purposes of calculating what GST would be payable under an arrangement known as a ‘margin scheme’. The defendant gave the seller a valuation report and provided a copy to the plaintiff. The valuation contained an extensive disclaimer, which included the following sentences: ‘This valuation is for the use only of the party to whom it is addressed. No responsibility is accepted to any third party who may use or rely on the whole or any part of the content of this valuation.’ The plaintiff paid GST calculated on the basis of the defendant’s valuation but then sued the defendant, claiming that he had negligently overvalued the property. The Victorian Civil and Administrative Tribunal (VCAT) held that the defendant owed the plaintiff a duty of care, notwithstanding the disclaimer, but dismissed the plaintiff’s claim on the ground that the plaintiff had not proved that its loss was caused by the defendant’s negligence. An appeal to the Trial Division of the Supreme Court of Victoria was dismissed. The plaintiff appealed again. [page 413] Issue: Did the defendant valuer owe the plaintiff a duty of care in the light of the disclaimer of responsibility to anyone other than the seller? Decision: The Victorian Court of Appeal allowed the plaintiff’s appeal, holding that the defendant owed the plaintiff a duty of care and that his breach of it had caused the plaintiff’s loss. The court held that the disclaimer did not operate to negate the existence of a duty of care. Ashley JA (with whom Buchanan JA and Kellam AJA agreed) quoted part of the passage from Barwick CJ’s judgment in Evatt reproduced above at 8.23, and said (at [38]): The decision of the High Court (by majority) was reversed by the Privy Council (by majority). But the accuracy of the observation of Barwick CJ cited above, strictly obiter dictum, was not thereby undermined.

Ashley JA pointed out (at [25]) that the defendant knew that the property he was valuing was to be sold, knew that both seller and buyer would rely on his valuation for the purposes of calculating GST, and knew that the seller of the property had asked for the valuation at the plaintiff’s request. Applying the principles stated by Barwick CJ in Evatt in those circumstances, Ashley JA held that VCAT had been correct to hold that the defendant owed the plaintiff a duty of care, despite the disclaimer. Ashley JA said (at [39], [48]): In my opinion, an investigation of “all the circumstances of and surrounding of the giving of” the valuation well justified the conclusion reached by the tribunal concerning the operation of the disclaimer. The matters to which the tribunal referred, and the several additional matters which I have mentioned, pointed in that direction. … [T]he second part of the disclaimer should not be understood to exclude responsibility for damage resulting to the [plaintiff] by the very use of the valuation by the vendor for which the [defendant] had impliedly accepted responsibility in the first part of the clause.

8.25 Similarly, the principles stated by Barwick CJ in Evatt’s case (see 8.23) suggest that a disclaimer may not be effective where the defendant is the only possible source of the information or advice. In those circumstances, both the defendant and the plaintiff would know that the plaintiff would have to rely on the statement, despite the existence of the disclaimer, because she or he would have no choice but to do so. Some support for that conclusion may be found in cases involving local authorities. Since Shaddock’s case (see 8.15), local authorities have disclaimed responsibility for information given to prospective purchasers of property, even though they are often effectively the only available source of that information. A common form of disclaimer is: ‘The above information has been taken from the council’s records but council cannot accept responsibility for any omission or inaccuracy.’ In Burke v Forbes Shire Council (1987) Aust Torts Reports ¶80-122, it was held that this form of words did not negate the existence of a duty of care owed by the defendant council, because it merely disclaimed responsibility for the accuracy of the information in the council’s records, and did not disclaim liability for taking reasonable care to ensure that the information given to the plaintiff accurately reflected the contents of those records. Similarly, in Mid Density Developments Pty Ltd v Rockdale Municipal Council (1993) 44

FCR 290; 116 ALR 460, it was held that this form of words did not negate the existence of a duty of [page 414] care owed by the defendant council, which had not checked its records at all before giving information to the plaintiff. Gummow, Hill and Drummond JJ said (at FCR 301; ALR 471): We would not accept the submission for the [defendant] that the sentence … operated as a disclaimer of liability or rendered the [plaintiff’s] reliance on the certificates unreasonable.

To whom is the duty owed? 8.26 Where the plaintiff is not the immediate recipient of the information or advice given by the defendant, but has received it via some intermediary, the fear of indeterminate liability (see 8.2) has led the courts to take a restrictive approach, often denying that a duty is owed. The general principles applicable in such a situation were stated in the following case. Key Case San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979 (1986) 162 CLR 340; 68 ALR 161 Facts: The Sydney City Council published plans for the redevelopment of the inner city suburb of Woolloomooloo. The plans had been developed by the State Planning Authority. The plaintiff companies bought properties in Woolloomooloo, and they suffered considerable losses when the Sydney City Council dropped the redevelopment plans when it became apparent that they were unworkable. The plaintiffs sued the council and the Planning Authority, alleging that their negligence in preparing and publishing the plans had caused their losses. Issue: Did the council and the Planning Authority owe a duty of care to the plaintiffs, who had relied on the redevelopment plans? Decision: The High Court of Australia held that the defendants did not owe the plaintiffs a duty of care, for a number of reasons. The principal reason was that the redevelopment plan contained no feasibility statements. Because the defendants had

not said that Woolloomooloo would and could be redeveloped in accordance with the plan, it was not reasonable for the plaintiffs to rely on the statements in the redevelopment plan, so no duty was owed. The court also said that, although a financial interest in the defendant may be sufficient to give rise to a duty of care (see 8.19–8.20), the defendants did not have sufficient financial interest to give rise to a duty of care in the circumstances (at CLR 358; ALR 171). Referring to the fact that the plaintiffs had not requested the information given by the defendants, the majority stated that that fact was not fatal to the existence of a duty of care (see the passage quoted at 8.17), and continued later (at CLR 358; ALR 171): [I]t is necessary not only that A intends that B or members of a class of persons should act or refrain from acting in a particular way, but also that A makes the statement with the intention of inducing B or members of that class, in reliance on the statement, to act or refrain from acting in the particular way, in circumstances where A should realise that economic loss may be suffered if the statement is not true.

[page 415] 8.27 A typical (but not the only) example of a plaintiff who is not the immediate recipient of the information or advice is to be found when an accountant audits company accounts and negligently fails to notice that the accounts overvalue the company’s assets. The immediate recipient of the statement in the audit report is the company itself, but other people, such as banks, investors or other lenders, may also rely on the audited accounts and the auditor’s statement when making an assessment of the company’s value. In R Lowe Lippman Figdor & Franck v AGC (Advances) Ltd [1992] 2 VR 671, the Appeal Division of the Supreme Court of Victoria held that an auditor does not owe a duty of care to third parties in such a case unless it intended to induce them to rely on the audit statement. The High Court took a similarly restrictive approach in the next case, with some members of the court adopting the Lowe Lippman test. Key Case Esanda Finance Corp Ltd v Peat Marwick Hungerfords (Reg) (1997) 188 CLR 241; 142 ALR 750

Facts: The plaintiff lent money to a company named Excel, relying on accounts of Excel that had been audited by the defendant. The accounts overstated Excel’s assets, and Excel defaulted on the loan, causing loss to the plaintiff. The plaintiff sued the defendant to recover the money that it had lost as a result of being unable to recover the loan to Excel. Issue: Did the defendant owe the plaintiff a duty to take reasonable care that any statements it made about Excel’s assets in the audit report were accurate? Decision: The High Court of Australia unanimously held that the defendant did not owe the plaintiff a duty of care when auditing Excel’s accounts. It is difficult to identify any single reason that commanded a majority of the court. Dawson J said (at CLR 256–7; ALR 761): The absence of any request, and the absence of an intention on the part of a firm of auditors to induce a financier to act upon the audited accounts of a company by making finance available to it, led Brooking J (with whom Gobbo and Tadgell JJ agreed) to hold in R Lowe Lippman Figdor & Franck v AGC (Advances) Ltd that the auditors owed no duty of care to the financier. … But an intention to induce a person to whom information or advice is given to act in a particular way is merely one of the various means by which it may be shown that the reliance by that person upon the information or advice is reasonable so that, in combination with other relevant circumstances, it may serve to establish a relationship of proximity which will support a duty of care. It was in this sense, I think, that the majority in San Sebastian commented that in cases where the defendant intends the information or advice to operate as a direct inducement to action, the reasonableness of the reliance will not be a critical factor. Brennan J pointed out in San Sebastian that it is always necessary in cases of negligent misstatement to establish that the statement in question operated as an inducement to the person to whom it was made to act upon it. As I have said, that is just another way of saying that it is necessary to prove reliance in order to show that any loss was [page 416] caused by reason of the negligence of the maker of the statement and for that purpose it does not matter whether the inducement was intentional or not. Toohey and Gaudron JJ said (at CLR 264; ALR 767): In the context of liability for negligent statements, it seems to us that reliance… is to be understood, in the context of the provision of information or advice, as an expectation, which is reasonable in the circumstances, that due care will be exercised in relation to that provision. Similarly, we consider that, in that same context, assumption of responsibility … should be understood as the assumption of responsibility for providing information or advice in circumstances where it is

known, or ought reasonably be known, that it will or may be acted upon for a serious purpose, and loss may be suffered if it proves to be inaccurate. Having defined their terms in this way, Toohey and Gaudron JJ said (at CLR 265; ALR 768): The decided cases do not identify precisely what it is that results in liability for economic loss suffered in consequence of the voluntary provision of information or advice. However, commonsense requires the conclusion that a special relationship of proximity marked either by reliance or by the assumption of responsibility does not arise unless the person providing the information or advice has some special expertise or knowledge, or some special means of acquiring information which is not available to the recipient. Moreover, ordinary principles require that the relationship does not arise unless it is reasonable for the recipient to act on that information or advice without further inquiry. Similarly, ordinary principles require that it be reasonable for the recipient to act upon it for the purpose for which it is used. That is not to say that a special relationship of proximity exists if these conditions are satisfied. Rather, it is to say that the relationship does not arise unless they are. McHugh J said (at CLR 275; ALR 776): [T]he position in Australia to date with respect to liability for pure economic loss caused by negligent misstatement is that, absent a statement to a particular person in response to a particular request for information or advice or an assumption of responsibility to the plaintiff for that statement, it will be difficult to establish the requisite duty of care unless there is an intention to induce the recipient of the information or advice, or a class to which the recipient belongs, to act or refrain from acting on it. Mere knowledge by a defendant that the information or advice will be communicated to the plaintiff is not enough. … Nevertheless, the decisions have all emphasised that a lack of an intention to induce the plaintiff to act or refrain from acting is not necessarily fatal to a plaintiff’s claim because other factors may be present that obviate the need for such an intention. Later, McHugh J said (at CLR 281; ALR 780): In my opinion, the law in Australia was correctly stated and applied by the Appeal Division of the Supreme Court of Victoria in R Lowe Lippman. … Moreover, I can see no good reason for extending the liability of auditors to those members of a class whom the auditor knows or ought to know will rely on the audit where the auditor has not assumed responsibility to those members or intended to induce them to rely on the audit.

8.28 Although Lowe Lippman (see 8.27) introduced a new factor into the consideration of duty of care — that of intention to induce reliance

— that factor was not clearly adopted by all members of the court in Esanda Finance (see 8.27), or [page 417] even a majority of them. For the most part, the judgments in Esanda Finance merely used the factors considered elsewhere in this chapter in a rather more conservative fashion than had previously been the case. There can be no doubt, however, that the decision in Esanda Finance indicates that the maker of a statement will seldom owe a duty of care to anyone other than the immediate recipient. A comparison of the next four cases shows that a duty may nevertheless be owed to third parties, even after Esanda Finance, if the defendant knows with enough certainty that a particular third party, or class of third parties, will be affected by its statements. Case Example Ta Ho Ma Pty Ltd v Allen (1999) 47 NSWLR 1 Facts: The defendant, a valuer, negligently overvalued a residential property. The valuation was prepared for the owner of the property, and it was stated to be ‘for mortgage purposes’. Nine months later, the valuation was shown to the plaintiff, which relied on the valuation when agreeing to lend money to the property owner under a mortgage. The property owner defaulted on the mortgage loan. The plaintiff took possession of the property, which was then sold for less than the value of the mortgage loan. The plaintiff sued the defendant, alleging that its loss was caused by the defendant’s admitted negligence in preparing the valuation. Issue: Did the defendant owe a duty of care to subsequent mortgage borrowers, to whom it did not give the valuation? Decision: The Court of Appeal of New South Wales held that the valuer did not owe the mortgagee a duty of care, despite the fact that the valuation was given ‘for mortgage purposes’. Between quotations from Esanda Finance (see 8.27) and consideration of the principles stated there, Giles JA (with whom Handley JA agreed) said (at [18], [20], [24]): Although a duty of care may be found from other considerations, in this area an important, often determinative, consideration is expectation of reliance on the statement. …

Involved in these criteria is that the class of persons to whom a duty of care is owed will normally be confined to those persons whose reliance on the information or advice is reasonable. The reasonableness will be tested according to the circumstances as they become known. … So where a valuer puts out a negligent valuation the class of persons to whom the valuer owes a duty of care will normally be confined, apart from any other considerations, to those persons whom the valuer knows or ought to know will reasonably rely on the valuation. If the reliance of the particular financier is unreasonable, it will normally follow that the criteria for a duty of care owed to the financier are not satisfied. If the valuer knows or intends that the plaintiff as a particular person will rely on the valuation, even unreasonably, different considerations of course arise. The court held that the plaintiff mortgagee had not acted reasonably in relying on a valuation that was nine months old, without making any further inquiries. Thus, no duty was owed.

[page 418] Case Example Interchase Corp Ltd v ACN 010 087 573 Pty Ltd [2003] 1 Qd R 26 Facts: The defendant valuer negligently overvalued a retail shopping centre. The valuation was given to a development company, which had a contract with the owner of the shopping centre. The valuation was used as the basis for sums paid by the plaintiff, the shopping centre owner, to the development company under the contract between them. The plaintiff sued the defendant valuer, alleging that its losses were caused by the negligent valuation. Issue: Did the defendant valuer owe the plaintiff a duty to take reasonable care in preparing the valuation requested and paid for by the shopping centre? Decision: The Queensland Court of Appeal held that the defendant did owe a duty of care to the plaintiff. After quoting from Esanda Finance, McPherson JA (with whom Thomas JA agreed) said (at [26]): If some concept such as linking conduct or contractual equivalence is adopted here, [the plaintiff] has firm ground on which to base its claim for damages against [the defendant] for their negligent valuation of the Myer Centre in 1988. [The plaintiff] was not simply one person among many who could possibly be foreseen as likely to act on the defendants’ valuations. It was one of only two who were directly and immediately affected by delivery and receipt of the valuation.

Case Example Derring Lane Pty Ltd v Fitzgibbon (2007) 16 VR 563 Facts: See 8.24. Issue: Did the defendant valuer owe the plaintiff a duty to take reasonable care in preparing the valuation requested and paid for by the seller? Decision: The Victorian Court of Appeal held that the defendant valuer owed the plaintiff buyer a duty of care, even though the valuation was prepared for the seller of the property. The court held that the defendant owed the plaintiff a duty because he (the defendant) knew that the property he was valuing was to be sold, knew that both seller and buyer would rely on his valuation for the purposes of calculating GST, and knew that the seller of the property had asked for the valuation at the plaintiff’s request.

Case Example ABN AMRO Bank NV v Bathurst Regional Council (2014) 224 FCR 1 Facts: A bank created a highly complex structured credit derivative marketed under the name Rembrandt Notes. It asked the American ratings agency Standard & [page 419] Poor’s (S&P) to rate the creditworthiness of the notes. S&P gave the notes its highest rating, AAA. S&P knew that the bank would publish the rating throughout Australia to potential purchasers of Rembrandt Notes. A company (LGFS) bought Rembrandt Notes from the bank, some of which it sold to municipal councils in New South Wales, including the plaintiff council. The notes turned out to be worthless. The plaintiff council and LGFS sued S&P (among others), alleging that it had negligently misrepresented the financial soundness of the notes. Issue: Did S&P owe a duty of care to subsequent purchasers of Rembrandt Notes even though it had not communicated directly with them and did not know their identity? Decision: A Full Court of the Federal Court held that S&P was liable to the plaintiff council and LGFS. Jacobson, Gilmour and Gordon JJ rejected S&P’s argument that

making them responsible for their rating would expose them to indeterminate liability to purchasers of the notes, saying (at [589]): S&P’s contention fails on a number of bases. First, S&P misstates what constitutes indeterminacy and the role that concept plays in the proper allocation of risk in negligence claims. Second, the concept of indeterminacy has no, or no separate, role in cases of negligent misstatement or advice. Those ideas are not unrelated. Knowledge of the identity of the person or persons to whom a duty is owed is not necessary, or generally of significance, in determining the existence of a duty of care. In affirming the trial judge’s finding that S&P owed LGFS and the council a duty of care, Jacobson, Gilmour and Gordon JJ said (at [579]–[580], [582]): The primary judge held that S&P owed a duty of care to LGFS (and to the councils) … That duty was the duty earlier described — a duty to exercise reasonable care in forming, and to have reasonable grounds for, the opinion expressed by the rating. Applying the criteria identified [above], the primary judge held that S&P knew that potential investors in the Rembrandt notes would rely on S&P’s opinion as to the creditworthiness of the notes in deciding whether to invest in the notes …That finding was not surprising. The factual findings [support] that conclusion … As the primary judge stated, foreseeable loss was the immediate consequence of S&P carelessly rating the notes as the risk of default, and loss on default, was the risk to which the rating was directed … The risk was not insignificant, either in possibility or quantum.

Vulnerability as a common thread? 8.29 In Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515; 205 ALR 522 at [23]–[24], Gleeson CJ, Gummow, Hayne and Heydon JJ said: Since Caltex Oil [(Australia) Pty Ltd v The Dredge ‘Willemstad’], and most notably in Perre v Apand Pty Ltd, the vulnerability of the plaintiff has emerged as an important requirement in cases where a duty of care to avoid economic loss has been held to have been owed. ‘Vulnerability’, in this context, is not to be understood as meaning only that the plaintiff was likely to suffer damage if reasonable care was not taken. Rather, ‘vulnerability’ is to be understood as a reference to the plaintiff’s inability to protect itself from the consequences of a defendant’s want of reasonable care,

[page 420]

either entirely or at least in a way which would cast the consequences of loss on the defendant. … [I]n Esanda Finance Corp Ltd v Peat Marwick Hungerfords, the financier could itself have made inquiries about the financial position of the company to which it was to lend money, rather than depend upon the auditor’s certification of the accounts of the company. In other cases of pure economic loss … reference has been made to notions of assumption of responsibility and known reliance. The negligent misstatement cases like Mutual Life & Citizens’ Assurance Co Ltd v Evatt and Shaddock & Associates Pty Ltd v Parramatta City Council (No 1) can be seen as cases in which a central plank in the plaintiff’s allegation that the defendant owed it a duty of care is the contention that the defendant knew that the plaintiff would rely on the accuracy of the information the defendant provided. And it may be, as Professor Stapleton has suggested [(2002) 50 UCLA Law Review 531 at 558–9], that these cases, too, can be explained by reference to notions of vulnerability.

Caltex Oil (see 8.32) and Perre v Apand Pty Ltd (1999) 198 CLR 180; 164 ALR 606 (see 8.34) are cases about negligent acts causing purely economic loss. However, the references in the quoted passage to Esanda Finance (see 8.27), Evatt (see 8.14) and Shaddock (see 8.15) indicate that the Woolcock court took the view that the various factors considered in this chapter — reasonable reliance, assumption (and disclaimer) of responsibility, duty to third parties — may all be explained in terms of the vulnerability of the plaintiff. Recent years have seen a steady stream of negligent misstatement cases casting the various duty factors in terms of vulnerability, usually after quoting the above passage: see, for example, Dartberg Pty Ltd v Wealthcare Financial Planning Pty Ltd (2007) 164 FCR 450; 244 ALR 552 at [60]–[69] per Middleton J; Street v Luna Park Sydney Pty Ltd (2009) 223 FLR 245 at [242]–[243], [255] per Brereton J; Hardie Finance Corp Pty Ltd v Ahern (No 3) [2010] WASC 403 at [374] per Pritchard J; Girotto v Phillips Fox [2011] VSC 293 at [296]–[299] per Hollingworth J; Australian Executor Trustees Ltd v Propell National Valuers (WA) Pty Ltd [2011] FCA 522 at [183]–[185] per Barker J; Meredith v Commonwealth (No 2) [2013] ACTSC 221 at [510]–[531] per Refshauge J; Owners – Strata Plan No 61288 v Brookfield Australia Investments Ltd [2013] NSWCA 317 at [19]– [42] per Basten JA (vulnerability a ‘key mechanism for maintaining control’). The idea that the concept of vulnerability is the common thread to all of the negligent misstatement duty factors, yet does not replace the

various factors with a single test, was perhaps most clearly expressed in the following passage from the judgment of McLure JA (with whom Buss JA and Murray AJA agreed) in Middleton v Aon Risk Services Australia Ltd [2008] WASCA 239 at [47]–[49]: Negligent misrepresentation is a discrete category in the broad class of claims in negligence for economic loss: San Sebastian Pty Ltd v The Minister [Administering the Environmental Planning and Assessment Act 1979] …; Tepko Pty Ltd v Water Board. Economic loss claims have the potential to produce indeterminacy in class, time and quantum. Prior to Perre v Apand, the High Court identified specific requirements that had to be proven in order to succeed in a negligent misstatement claim: Mutual Life & Citizens’ Assurance Co Ltd v Evatt …; Esanda Finance Corporation Ltd v Peat

[page 421] Marwick Hungerfords. In Perre v Apand the High Court identified a general principle that underpins all categories of claims for economic loss. The court said that the matters upon which a duty of care depend include, inter alia, knowledge or means of knowledge of an ascertainable class of vulnerable persons who are unable to protect themselves from harm. Reasonable reliance and assumption of responsibility were characterised as indicators of vulnerability. However, the factors identified in earlier cases on negligent misstatement remain relevant to the determination of whether a duty of care arises …

The relevance of the plaintiff’s vulnerability was revisited by the High Court of Australia in Barclay v Penberthy (2012) 246 CLR 258; 291 ALR 608: see 8.39. As we shall see, the Barclay court seemed to suggest that vulnerability is not required in all economic loss cases, but it continues to be a relevant factor in most. Similarly, in ABN AMRO Bank NV v Bathurst Regional Council (see 8.28), Jacobson, Gilmour and Gordon JJ said (at [823]): [I]n the field of negligent misstatement, vulnerability is the consequence of, not an additional criterion of, knowledge (actual or which a reasonable person would have) of reasonable reliance by an ascertainable class of persons … [T]here is no superadded requirement of vulnerability in addition to the Tepko criteria.

Liability for Negligent Acts Causing Purely

Economic Loss Introduction 8.30 As we saw in 8.2, the law initially solved the problem of indeterminate liability for negligent acts causing purely economic losses by confining recovery to those who had suffered personal injury or property damage as a result of the defendant’s negligence. This was (and is) known as ‘the exclusionary rule’ or, sometimes, the ‘bright line rule’. For example, if the defendant negligently damaged the plaintiff’s own ship, the plaintiff could recover any profits that were lost because the ship was unable to undertake profitable voyages: see Gracie (Owners) v Argentino (Owners): The Argentino (1889) 14 App Cas 519. In contrast, if the defendant negligently damaged a ship that was not owned by the plaintiff, the plaintiff could not recover any profits that she or he had lost as a result, such as loss of a contract to tow the damaged ship with the plaintiff’s tug: see SA de Remorquage à Helice v Bennetts [1911] 1 KB 243. 8.31 Although this solution countered the spectre of indeterminate liability, it did so in an arbitrary manner: it was not clear what special magic there was about physical damage that rendered consequential economic losses recoverable when purely economic losses were not. Further, after Hedley Byrne (see 8.6) established that damages for purely economic losses caused by negligent misstatements could, in certain circumstances, be recoverable, there was another arbitrary distinction, between statements and acts causing purely economic loss: it was not clear what special magic there was about statements that rendered statement-caused losses recoverable when act-caused losses were not. [page 422] 8.32 In 1976, the High Court of Australia resolved some of these anomalies by allowing recovery for purely economic losses caused by

negligent acts, subject to a restrictive test for the existence of a duty of care. Key Case Caltex Oil (Australia) Pty Ltd v The Dredge ‘Willemstad’ (1976) 136 CLR 529; 11 ALR 227 Facts: The defendant dredge negligently went off course while dredging a channel in Botany Bay. It dredged through a pipeline at the bottom of the bay. The pipeline was owned by Australian Oil Refining Pty Ltd (AOR). It carried oil from AOR’s oil refinery to the plaintiff’s oil terminal. The pipeline was severed and, as a result, the plaintiff suffered considerable losses in transporting oil from AOR’s refinery to its terminal by road around Botany Bay. The plaintiff sued the dredge, alleging that its economic loss had been caused by the negligent navigation of the dredge. (This kind of action, which is in the court’s Admiralty jurisdiction, is known as an in rem action. The plaintiff proceeded against the thing (the res) that caused the damage, the dredge itself, rather than its owner in person (in personam).) Issue: Did the defendant dredge owe a duty of care to the plaintiff, who did not own the pipeline at the bottom of Botany Bay but who suffered considerable economic loss after the pipeline was damaged? Decision: The High Court of Australia held unanimously that the plaintiff could recover its economic losses from the defendant, even though the plaintiff had not suffered any physical damage itself. Gibbs J said (at CLR 555; ALR 245): In my opinion, it is still right to say that as a general rule damages are not recoverable for economic loss which is not consequential upon injury to the plaintiff’s person or property. The fact that the loss was foreseeable is not enough to make it recoverable. However, there are exceptional cases in which the defendant has knowledge or means of knowledge that the plaintiff individually, and not merely as a member of an unascertained class, will be likely to suffer economic loss as a consequence of his negligence, and owes the plaintiff a duty to take care not to cause him such damage by his negligent act. It is not necessary, and would not be wise, to attempt to formulate a principle that would cover all cases in which a duty is owed … All of the facts of the particular case will have to be considered. Stephen J described the need to find a ‘control mechanism’ that would counter the possibility of indeterminate liability without the arbitrariness of the distinction between pure and consequential economic losses. Of that ‘control mechanism’, he said (at CLR 574–5; ALR 260): Its precise nature and the extent to which it should restrict recovery for purely economic loss must depend upon policy considerations … [I]n the general realm of negligent conduct it may be that no more specific proposition can be formulated than a need for insistence upon sufficient proximity between tortious

act and compensable detriment. The articulation, through the cases, of circumstances which denote sufficient proximity will provide a body of precedent productive of the necessary certainty … Stephen J listed five features of the particular case that he considered gave rise to a duty of care in the circumstances. The first two of these led him to the conclusion [page 423] that ‘Caltex was within the reasonable contemplation of the defendants as a person likely to suffer economic loss if the pipelines were cut’: at CLR 576–7; ALR 261–2. Mason J said (at CLR 593; ALR 274): A defendant will then be liable for economic damage due to his negligent conduct when he can reasonably foresee that a specific individual, as distinct from a general class of persons, will suffer financial loss as a consequence of his conduct. This approach eliminates or diminishes the prospect that there will come into existence liability to an indeterminate class of persons …

8.33 As in the case of negligent misstatements causing purely economic loss (see 8.3–8.29), there is no single test for the existence of a duty of care in negligent act cases. Instead, several factors are taken into account. Drawing on the various factors highlighted in the Caltex case (see 8.32), later cases have stressed the need for a flexible approach, while keeping in mind firmly the need to control the spectre of indeterminate liability.

Subsequent developments: salient features 8.34 As we saw in Chapter 5, the High Court of Australia has tried and rejected several duty of care tests before settling, at least for the time being, on the rather vague and amorphous ‘salient features’ approach. The next case was the first decision of the High Court after Caltex to affirm that there can be liability for purely economic losses caused by negligent acts. Unfortunately, it is no easier to determine a single reason for that conclusion than it was in the Caltex case (see 8.32), as each member of the court delivered a separate judgment, just as their counterparts had done 23 years before in Caltex.

Key Case Perre v Apand Pty Ltd (1999) 198 CLR 180; 164 ALR 606 Facts: Some of the plaintiffs owned potato farms in South Australia; others washed, graded and packed potatoes grown by others. Much of the South Australian potato crop was ‘exported’ to Western Australia. The defendant sent a new brand of seed potato to a farm near the properties owned by the plaintiffs. The new potatoes were infected with bacterial wilt. Western Australian regulations prohibited the importation of potatoes if they had been grown on property within 20 kilometres of an outbreak of bacterial wilt. As a result, the plaintiffs lost their Western Australian markets, even though their own potatoes were not infected. They claimed damages for their economic losses. At first instance, the Federal Court held that the defendant owed the plaintiffs no duty of care. That decision was affirmed on appeal by a Full Court of the Federal Court, which applied Caltex principles (see 8.32) and concluded that there could [page 424] only be recovery if the defendant had knowledge or means of knowledge of the plaintiff individually or as a member of a defined and small ascertainable class: Perre v Apand Pty Ltd (1997) 80 FCR 19 at 43. The plaintiffs appealed again. Issue: Did the defendant owe a duty not to cause loss to potato farmers in the vicinity of the farm that planted the defendant’s seeds that were infected with bacterial wilt? Decision: The High Court reversed the decision of the Full Court of the Federal Court, holding that the defendant did owe the plaintiffs a duty. This was so despite the fact that there was no direct relationship between the plaintiffs’ loss and that suffered by the affected farm, and no direct dealings between the plaintiffs and the affected farm. Gaudron J said that in cases not involving negligent misrepresentation, a sufficient control mechanism was to be found in determining whether the defendant knew or ought to have known that her or his conduct would infringe a legally protected right of the plaintiff. Her Honour said (at [42]): [W]here a person knows or ought to know that his or her acts or omissions may cause the loss or impairment of legal rights possessed, enjoyed or exercised by another, whether as an individual or as a member of a class, and that that latter person is in no position to protect his or her own interests, there is a relationship such that the law should impose a duty of care on the former to take reasonable steps to avoid a foreseeable risk of economic loss resulting from the loss or impairment of those rights. Applying this test, Gaudron J held that the defendants knew or ought to have known

that their conduct might impair the plaintiffs’ right to sell potatoes in the Western Australian market and to use their land and equipment for the production of potatoes. McHugh J rejected the various general tests that had been proposed, preferring an incremental approach that referred to the reasons for decision in previous analogous cases: at [94]–[99]; see also Chapter 5. In the present case, McHugh J emphasised the risk of indeterminate liability; the question whether liability would constitute an undue burden on the defendant’s trading activities; the plaintiffs’ vulnerability and inability to protect themselves; and the defendant’s knowledge or foreseeability of the risk of harm to the plaintiffs: at [106]–[132]. Gummow J (with whom Gleeson CJ agreed) preferred the approach taken by Stephen J in Caltex (see 8.32), isolating ‘salient features’ which combined to constitute a sufficiently close relationship to give rise to a duty of care (at [201]). Those ‘salient features’ included the fact that the defendant had actual knowledge of the fact that interstate exports would be prohibited from properties close to a farm infected with bacterial wilt; the fact that the defendant could control the location of the trial with the infected seed; and the fact that the plaintiffs had no way of knowing about the risk to which they were being exposed and thus had no avenue to protect themselves against it: at [211]–[221]. Kirby J applied the three-stage duty test from Caparo Industries plc v Dickman: at [259]. As we saw in Chapter 5, the High Court of Australia later unanimously held that the Caparo test used by Kirby J ‘does not represent the law in Australia’: see Sullivan v Moody (2001) 207 CLR 562 at 579; 183 ALR 404 at [49] per Gleeson CJ, Gaudron, McHugh, Hayne and Callinan JJ. Kirby J reluctantly abandoned the Caparo test in Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; 194 ALR 337 at [238]. [page 425] Hayne J said (at [335]): [T]he search for a control mechanism in addition to foreseeability is driven by at least two considerations — the desire to avoid indeterminate liability and the concern not to establish a rule that will render ‘ordinary’ business conduct tortious. If those are the concerns, then the criterion or criteria devised by the courts should address them directly rather than obscure their significance behind expressions such as ‘fair, just and reasonable’. It may be that there are additional considerations that may have to be taken into account as this area of law develops but for present purposes the two that I have mentioned are critical: whether the liability is indeterminate, and whether the liability is consistent with basic assumptions about the economy in which the conduct takes place. Applying this test to the present case, Hayne J said that liability was not indeterminate because it was possible for the defendant to identify precisely who would be affected by an outbreak of bacterial wilt caused by its negligence (at [337]). Also, because it would have been unlawful for the defendant to sell infected seed deliberately, imposition of

tortious liability would not interfere with the defendant’s ordinary business conduct: at [349]. Like Gleeson CJ, Gummow and McHugh JJ, Callinan J emphasised a series of relevant factors rather than applying a single test. Those factors included the dominance of the defendant in the potato industry, which led to its knowledge of the dangers of bacterial wilt; the fact that the Western Australian legislation necessarily limited the class of those who might be affected; the fact that imposing liability on the defendant would not affect its regular trading activities; and the vulnerability of the plaintiffs: at [407]–[426].

8.35 After considering Perre at some length in Reynolds v Katoomba RSL All Services Club Ltd (2001) 53 NSWLR 43 at [124], Powell JA asked himself a pithy question that may well have occurred to you too: ‘What, then, is one to make of all this?’ Although the answer to that telling question is by no means obvious, it is possible to discern some common themes in the Perre judgments.2 First, like the Caltex judges before them (see 8.32), the Perre judges all emphasised the importance of the fact that the class of affected plaintiffs was of determinate size and readily ascertainable make-up. Second, another factor that featured quite heavily in the Perre judgments was the plaintiffs’ vulnerability, in the sense of their inability to do anything to protect themselves from the harm that befell them. (The vulnerability of the plaintiff had also been emphasised by the High Court in Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520; 120 ALR 42 (see 14.29), Pyrenees Shire Council v Day (1998) 192 CLR 330; 151 ALR 147 (see 7.12), Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1; 167 ALR 1 (see 7.13) and Agar v Hyde (2000) 201 CLR 552; 173 ALR 665.) The court returned to the concept of vulnerability in Barclay v Penberthy (2012) 246 CLR 258; 291 ALR 608: see 8.39. [page 426] Third, several members of the Perre court expressed concern that the law of torts should not unduly interfere with the defendant’s ordinary business activity.

Vulnerability 8.36 As noted above (see 8.35), the plaintiff’s vulnerability had played an important part in several High Court decisions before Perre (see 8.34). It played an important role again in the next case, which explained that in this context, ‘vulnerability’ means the plaintiff’s inability to protect herself or himself, not merely the plaintiff’s susceptibility to loss as a result of the defendant’s conduct. Key Case Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515; 205 ALR 522 Facts: The defendant designed foundations for a warehouse and office complex. Some years after the complex was completed, the original owner sold the complex to the plaintiff. The sale contract did not include any warranty (that is, contractual promise from the seller to the buyer, the plaintiff) that the building was free from defects and the contract did not assign to the plaintiff any rights that the seller might have had against others in relation to defects in the complex. The plaintiff later discovered that the foundations designed by the defendant had settled. The plaintiff sued the defendant, seeking to recover the losses it had sustained as a result of buying a defective building. (The case proceeded on the basis that the plaintiff’s loss was a purely economic one. The High Court eventually confirmed that that was the proper characterisation of the plaintiff’s loss: see [19]–[20].) Issue: Did the defendant owe a duty to subsequent purchasers of the warehouse and office complex to take reasonable care to ensure that the foundations were sound, or was its duty confined to the original purchaser? Decision: The High Court of Australia held (by a majority of six to one, Kirby J dissenting) that the defendant did not owe the plaintiff a duty of care in the circumstances. Gleeson CJ, Gummow, Hayne and Heydon JJ based that conclusion principally on the fact that the plaintiff was not ‘vulnerable’, as that term was understood in Perre and other cases. Gleeson CJ, Gummow, Hayne and Heydon JJ said (at [23]): Since Caltex Oil, and most notably in Perre v Apand Pty Ltd, the vulnerability of the plaintiff has emerged as an important requirement in cases where a duty of care to avoid economic loss has been held to have been owed. ‘Vulnerability’, in this context, is not to be understood as meaning only that the plaintiff was likely to suffer damage if reasonable care was not taken. Rather, ‘vulnerability’ is to be understood as a reference to the plaintiff’s inability to protect itself from the consequences of a defendant’s want of reasonable care, either entirely or at least in a way which would cast the consequences of loss on the defendant. So, in Perre, the plaintiffs could do nothing to protect themselves from the economic consequences to them of the defendant’s negligence in sowing a crop which

caused the quarantining of the plaintiffs’ land. In Hill v Van Erp [see 5.21], the intended beneficiary depended entirely upon the solicitor performing the client’s retainer properly and the beneficiary could do nothing to ensure [page 427] that this was done. But in Esanda Finance Corp Ltd v Peat Marwick Hungerfords [see 8.27], the financier could itself have made inquiries about the financial position of the company to which it was to lend money, rather than depend upon the auditor’s certification of the accounts of the company. Applying those principles in the present case, their Honours concluded (at [31]): Neither the facts alleged in the statement of claim nor those set out in the case stated show that the [plaintiff] was, in any relevant sense, vulnerable to the economic consequences of any negligence of the [defendants] in their design of the foundations for the building. Those facts do not show that the [plaintiff] could not have protected itself against the economic loss it alleges it has suffered. It is agreed that no warranty of freedom from defect was included in the contract by which the [plaintiff] bought the land, and that there was no assignment to the [plaintiff] of any rights which the vendor may have had against third parties in respect of any claim for defects in the building. Those facts describe what did happen. They say nothing about what could have been done to cast on the [defendants] the burden of the economic consequences of any negligence by the [defendants]. The [plaintiff]’s pleading and the facts set out in the case stated are silent about whether the [plaintiff] could have sought and obtained the benefit of terms of that kind in the contract.

8.37 Although the plaintiff’s vulnerability (or lack of it) played an important part in both Perre (see 8.34) and Woolcock (see 8.36), in neither case did the High Court suggest that it was the only factor to be taken into account, or even the most important of salient factors. Perre (see 8.34) emphasised several relevant factors (see 8.35), including the importance of the requirement, centrally important in Caltex itself (see 8.32), that the class of affected plaintiffs must be of determinate size and readily ascertainable make-up. Nevertheless, many, if not most, of the post-Woolcock cases have focused on the requirement of vulnerability, suggesting that it may be becoming a ‘salient feature’ more salient than the others mentioned in previous cases. For example, in Brookfield Multiplex Ltd v Owners Corp Strata Plan 61288 (2014) 254 CLR 185; 313 ALR 408, a case with some similarities to

Woolcock, the High Court of Australia again held, unanimously this time, that the builder of a defective building did not owe a duty of care to subsequent purchasers. The seven judges gave four different judgments, but the subsequent purchaser’s lack of vulnerability in the Woolcock sense played a key role in each of them. For example, Hayne and Kiefel JJ said (at [57]–[58]): Reliance … may be a necessary element in demonstrating vulnerability, but it is not a sufficient element. As noted earlier, vulnerability is concerned with a plaintiff’s inability to protect itself from the defendant’s want of reasonable care, either entirely or at least in a way which would cast the consequences of loss on the defendant. It is neither necessary nor profitable to attempt to define what would or would not constitute vulnerability. It is enough to observe that both the developer and the original purchasers made contracts, including the standard contracts, which gave rights to have remedied defects in the common property vested in the [plaintiff]. The making of contracts which expressly provided for what quality of work was promised demonstrates the ability of the parties to protect against, and denies their

[page 428] vulnerability to, any lack of care by the builder in performance of its contractual obligations. It was not suggested that the parties could not protect their own interests. The builder did not owe the [plaintiff] a duty of care.

(See also French CJ at [34], Crennan, Bell and Keane JJ at [69] and Gageler J at [184]–[186].) 8.38 Similarly, the presence or absence of vulnerability (in the Woolcock sense of being unable to protect oneself) was regarded as a key (and sometimes the only) ‘salient feature’ in each of the following cases: Precision Products (NSW) Pty Ltd v Hawkesbury City Council (2008) 74 NSWLR 102 at [105] per Allsop P (with whom Beazley and McColl JJA agreed) (‘The most important of these features, however, is vulnerability’); Rail Corp of New South Wales v Fluor Australia Pty Ltd [2009] NSWCA 344 at [126]–[133] per Macfarlan JA (with whom Allsop P and Hodgson JA agreed) (focusing principally on the plaintiff’s vulnerability); Papadopoulos v MC Labour Hire Services Pty Ltd (No 4) (2009) 24 VR 665 at [82] per Beach J (‘In the present case, the question that looms largest is the second defendant’s ability to protect

itself against a loss of the kind in respect of which it now claims damages’); Western Districts Development Pty Ltd v Baulkham Hills Shire Council (2009) 75 NSWLR 706 at [77] per Preston CJ of LEC (with whom Campbell JA agreed) (‘The vulnerability of the plaintiff is an important factor in determining the existence of a duty of care to avoid economic loss’); Gwam Investments Pty Ltd v Outback Health Screenings Pty Ltd (2010) 106 SASR 167 at [127]–[129] per White J (with whom Kelly J agreed) (defendant’s submission based on the plaintiff’s lack of vulnerability). 8.39 Nevertheless, in the next case, the High Court of Australia seemed to hold that a duty of care can arise without vulnerability in the Woolcock sense, although unfortunately its decision is not entirely easy to understand. Key Case Barclay v Penberthy (2012) 246 CLR 258; 291 ALR 608 Facts: Two men employed by the plaintiff died and three other employees were injured when a light aircraft piloted by Penberthy, one of the defendants, crashed soon after take-off and caught fire. The plaintiff had chartered the plane from Penberthy’s employer. The accident was caused by the loss of power to one of the engines as a result of the failure of a substitute sleeve bearing designed by Barclay, another defendant. Among several other actions commenced as a result of the accident, the plaintiff sued the defendants, claiming that their negligence had caused it purely economic losses that it had suffered as a result of the death of, and injury to, its employees in the plane crash. The plaintiff’s claim raised the question whether the defendants owed it a duty to take reasonable care not to cause purely economic loss; however, the claim was complicated by two other factors. First, there was the question whether the long[page 429] standing rule in Baker v Bolton (1808) 1 Camp 493; 170 ER 1033 is part of the common law of Australia. The rule in Baker v Bolton states that the death of a human being cannot give rise to a claim by someone else at common law. Second, there was the question of the relevance of an old cause of action called the actio per quod servitium amisit, which is an action brought by an employer for the loss of services of its employee intentionally or negligently caused by the defendant.

On the question whether either of the defendants owed the plaintiff a duty of care to avoid economic losses, the trial judge held that the pilot, Penberthy, owed the plaintiff a duty of care but the sleeve bearing designer, Barclay, did not. The Court of Appeal of Western Australia held that both Barclay and Penberthy owed the plaintiff a duty to exercise reasonable care and were liable in negligence for loss of services of the three injured employees. However, the rule in Baker v Bolton prevented any recovery in relation to the two deceased employees. Both sides appealed to the High Court of Australia. Issues: Did either of the defendants owe the plaintiff a duty to take reasonable care not to cause it economic loss by harming its employees? Did the rule in Baker v Bolton still form part of the law of Australia, so as to preclude recovery in relation to the two deceased employees? Decision: The High Court of Australia held that the trial judge had been right to hold that Penberthy owed the plaintiff a duty of care but Barclay did not. The majority disagreed with the reasons given by the Court of Appeal of Western Australia for holding that Penberthy owed a duty of care. French CJ, Gummow, Hayne, Crennan and Bell JJ said that the relevant principles were stated in Woolcock (see 8.36) and ‘are not in dispute’ (at [42]). The majority pointed out that the Court of Appeal had proceeded on the basis that the plaintiff was not ‘vulnerable’ in the Woolcock sense (at [46]–[47]): The Court of Appeal proceeded on the footing that [the plaintiff] could have protected itself from the pure economic loss, which it suffered from the injury to its employees, by appropriate terms in its charter contract with [the pilot’s employer]. An express term presumably would have gone further than an implied term in the charter contract that [the pilot’s employer] would exercise reasonable care and skill in the performance of the charter contract, and would have required [the pilot’s employer] to accept liability to [the plaintiff] for pure economic loss suffered by [the plaintiff] from injury to its employees. In response, counsel for [the plaintiff] pointed to the absence of evidence that it could have negotiated successfully for the inclusion of such a term in the charter agreement. Further, in order to establish the existence of a duty of care owed to [the plaintiff] for which [the pilot’s employer] was vicariously liable, it was not incumbent upon [the plaintiff] to establish that it could not have bargained with [the pilot’s employer] for a particular contractual provision. The presence or absence of a claim in contract would not be determinative of a claim in tort. Because of the view that it had taken on the plaintiff’s lack of Woolcock ‘vulnerability’, the Court of Appeal would have held that neither of the defendants owed the plaintiff a duty of care, but it concluded that both of them did owe a duty because of the continued existence of the actio per quod. The High Court disagreed with that decision, holding that the actio per quod does not depend on any breach of a duty of care owed by the wrongdoer to the employer; it depends on an intentional or [page 430]

negligent act that injures the employee. Both Barclay and Penberthy were liable to the plaintiff under the actio per quod, because both had negligently injured the plaintiff’s employees. Only Penberthy and his employer were liable to the plaintiff in negligence because, as the trial judge had held (quoted with approval by the majority at [44]): [Mr Penberthy] knew the purpose of the flight. He knew that it was a commercial purpose. He knew that the company who employed his passengers was [the plaintiff]. Mr Penberthy knew, therefore, not only that [the plaintiff] was a member of an ascertainable class of commercial users of the aircraft, but that [the plaintiff] was the particular commercial entity which depended upon the exercise of his professional skill as a pilot for the successful performance of the service for which the aircraft was chartered. Of course, it was the case that if Penberthy failed, as he did, to discharge that duty of care, [the plaintiff] was vulnerable in the sense that they were unable to protect themselves from the foreseeable harm of an economic nature caused, in part, by Penberthy’s negligence. There are no other circumstances specially affecting the existence of a duty of care owed by Penberthy, and vicariously by [his employer], to [the plaintiff] in relation to economic loss suffered by that plaintiff. The High Court held that the rule in Baker v Bolton is still part of the law in Australia, with the result that the plaintiff could not recover any of the loss that it had suffered as a result of losing the services of the two deceased employees.

8.40 The majority judgment in Barclay (see 8.39) is a little difficult to follow. The majority approved the trial judge’s reasons for holding that Penberthy owed the plaintiff a duty of care, which included the plaintiff’s vulnerability in the Woolcock sense. However, the majority also observed that the plaintiff did not have to show that it could not have protected itself from economic loss by bargaining for some protective provision in the contract to charter the plane, which suggests that the majority thought that the plaintiff’s vulnerability was not relevant. In Apache Energy Ltd v Alcoa of Australia Ltd (No 2) (2013) 45 WAR 379; 307 ALR 376, McLure P of the Court of Appeal of Western Australia said that the parties in that case were in ‘deep disagreement as to the meaning and effect of the plurality majority [sic] judgment in Barclay’ (see [15]) and she observed (at [20]) (Newnes JA agreeing): There is no binding authority that vulnerability is a necessary condition of a duty of care to avoid pure economic loss. The plurality in Woolcock expressly declined to take that step. … In any event, there is no fixed or certain scope of the concept of vulnerability. The nature and degree of vulnerability sufficient to support a duty will

vary from case to case, category to category. … The state of the law on this subject is not sufficiently clear to enable it to be determined summarily.

In the light of Barclay (see 8.39) it is probably best simply to observe that Perre emphasised the relevance of several factors (see 8.35), as did Caltex before it (see 8.32), and that nothing has happened since then to suggest that there is a single, simple, test, whether it is vulnerability or anything else. That point was emphasised by Giles JA in Western Districts Development at [10]: [page 431] [W]hile vulnerability is an important factor in whether or not a duty of care to guard against economic loss is owed, it is not the sole consideration. On current jurisprudence, the decision that a duty of care is owed or is not owed is arrived at in novel circumstances upon a ‘multi-factorial’ approach, with a close analysis of the facts bearing on the relationship between the plaintiff and the defendant and regard to ‘salient features’ … The Magistrate’s decision could not, on the correct approach, be solely by regard to vulnerability. His decision that a duty of care was not owed involved (or should have involved) assessment of all salient features, only one (although a primary one) of which was vulnerability.

Similarly, in Tweed Shire Council v Allen [2009] NSWSC 1195, it was held that a Local Court Magistrate had erred by considering only the plaintiff’s vulnerability when arriving at her decision in relation to a duty not to cause purely economic loss.

‘Transferred loss’ cases 8.41 In Bryan v Maloney (1995) 182 CLR 609; 128 ALR 163, the High Court of Australia held that the builder of a house owed a duty to a subsequent purchaser to take reasonable care in the construction of the house. (Although the house did not begin to develop cracks until after the purchaser had taken possession from the first owner, the High Court treated the case as one of purely economic loss rather than physical damage. The defendant builder had not damaged an otherwise sound house but had built a house that had never been right. The plaintiff purchaser had suffered an economic loss because it had paid more for the house than it was actually worth.) A majority of

the court (Brennan CJ dissenting) held that the relationship between builder and purchaser was such as to give rise to a duty of care because of such factors as an assumption of responsibility by the builder and reliance by the purchaser on the builder’s competence. The court also reached its decision because of the fact that the house was a permanent structure to be used indefinitely, including by subsequent purchasers for whom it was likely to represent the most significant investment they would make during their lifetime. 8.42 Both Caltex (see 8.32) and Bryan v Maloney (see 8.41) are examples of what John Fleming dubbed ‘transferred loss’ cases.3 A ‘transferred loss’ case is one in which a loss that would otherwise be suffered by the owner of property is transferred (usually by contract) to another person who is not the owner of that property. For example, the loss suffered by the plaintiff in Bryan v Maloney was the very loss that the first property owner would have sustained had she remained the owner of the house. The loss was simply transferred from the first owner to the plaintiff when the house was sold. 8.43 In transferred loss cases, the traditional fear of indeterminate liability (see 8.2) is absent. Allowing the claim merely substitutes one claimant for another without increasing the defendant’s liability, as Fleming pointed out. Thus, there is less reason to deny recovery than there is in cases where the plaintiffs merely suffer [page 432] loss as a consequence of damage to the property of another or, as in the example in 8.1, to the environment. In the next two cases, Fleming’s concept of ‘transferred loss’ was used as the basis for finding that a duty existed. Case Example Seas Sapfor Forests Pty Ltd v Electricity Trust of South Australia (1996) 187 LSJS 369

Facts: Three plaintiffs sued the defendant, alleging that it had negligently caused the Ash Wednesday bushfire in 1983. The first plaintiff owned a forest that had been destroyed in the fire; the third plaintiff sold and milled the timber from that forest; the second plaintiff provided finance to the other two. Two new plaintiffs applied to be added to the action. The proposed fourth and fifth plaintiffs had taken over the sale and milling of the timber after the fire. They alleged that they had suffered economic loss because the quantity of timber they processed was less than it would have been if the fire had not occurred. A Supreme Court Master refused to allow the two new plaintiffs to be added to the action, on the basis that their claims were untenable because they were not owed any duty of care by the defendant. The new plaintiffs appealed to a Full Court of the Supreme Court of South Australia. Issue: Did the defendant owe the proposed fourth and fifth plaintiffs a duty not to cause them purely economic loss? Decision: The Full Court held, by a majority, that the appeal should be dismissed. The defendant did not owe the fourth and fifth plaintiffs a duty. Doyle CJ (with whom Nyland J agreed) said that the concept of the ‘identifiable plaintiff’ is much easier to define in ‘transferred loss’ cases. Doyle CJ said that there is no obvious reason for denying recovery in ‘transferred loss’ cases, because allowing the claim merely substitutes one claimant for another without increasing the defendant’s liability (at [74]–[75]): Therefore, one might say that in such cases the dangers of unascertainability are not as great as in others. One might conclude that one could substitute, say, a user of a pipeline for the owner of that pipeline without increasing the danger of unascertained damage, if the user is in much the same position and would suffer much the same loss as the pipeline owner normally would. This approach is supported by the justice of the case generally. … [T]he damage in such a case is the same sort as would have been suffered if there had been only a single victim; it has merely been imposed on more than one party. This point is particularly strong if the person with a proprietary interest would in any case be entitled to recover damages from the tortfeasor, subject to having to account for those damages to the sufferer of economic loss … Doyle CJ said that there could be no duty to the proposed fourth and fifth plaintiffs in the present case unless they could show that this was a ‘transferred loss’ case. Because the proposed new plaintiffs had not argued their case on that basis, Doyle CJ and Nyland J dismissed the appeal, leaving it open to the new plaintiffs to try again, basing their application on the grounds suggested by Doyle CJ. (The High Court of Australia refused the new plaintiffs special leave to appeal from the Full Court’s decision.)

[page 433]

Case Example McMullin v ICI Australia Operations Pty Ltd (1997) 72 FCR 1 Facts: The respondent (the name used for a defendant in the Federal Court) manufactured and sold an insecticide called Helix, which was sprayed on to cotton crops. The insecticide contained a chemical (CFZ) that was bio-accumulative, with the result that it got into the body tissue of cattle that were subsequently slaughtered for meat. The meat was rejected, some of it before slaughter, some after. Many different claims were made against the respondent in the Federal Court of Australia. Wilcox J grouped the claims into seven categories (at 69–70): (1) claimants whose cattle became contaminated while they owned them; (2) claimants who unwittingly bought alreadycontaminated cattle; (3) claimants who owned meat that was found to be contaminated and was therefore condemned; (4) claimants who found that cattle in their possession (but not ownership) were contaminated and thereafter incurred expense in holding them in quarantine; (5) claimants whose cattle were not in fact contaminated but were placed in quarantine; (6) claimants (such as feed suppliers) who lost business because of the discovery of the contamination; (7) claimants who lost business because of the effect of the government controls imposed after the contamination was discovered. Issue: Did the respondent owe a duty of care to any of the claimants in the seven categories? Decision: Wilcox J held that the respondent owed a duty to claimants in the first four categories ((1) to (4)) but not those in the last three ((5) to (7)). Claimants in category (1) posed no problems because their losses arose from physical damage to their own property, the contaminated cattle. Claimants in categories (2), (3) and (4) had suffered purely economic losses, but Wilcox J held that the respondent owed them a duty nonetheless. After quoting extensively from Doyle CJ’s judgment in Seas Sapfor, Wilcox J said (at 78): It seems to me the distinction made by Doyle CJ is apposite to this case. The claims made by people in the second category are for the recovery of ‘transferred losses’, flowing directly from the damage to the cattle such that, if the original owners had suffered the losses, they would have been claimable. These ‘transferred losses’ are different in kind from other economic losses. The claimants in categories (3) and (4) were also ‘transferred loss’ claimants. Those in categories (5) to (7) were not. They had suffered loss of business as a result of the Helix contamination crisis, but there was no connecting link between them and those who had suffered physical damage to property. Unlike the plaintiffs in Perre (see 8.35), the plaintiffs in categories (5) to (7) did not form a determinate, geographically confined class. What Wilcox J called ‘the cattle (or meat) trail’ (at 79) provided the connecting link distinguishing the different treatment of the plaintiffs in the different categories, just as the house provided the connecting link in Bryan (see 8.41): it was the means by which the original loss was transferred from one party to another. Those on the ‘cattle trail’

were ‘transferred loss’ claimants, to whom a duty was owed; those off the trail could not recover.

[page 434] 8.44 The High Court’s decision in Woolcock (see 8.36) cast some doubt on its decision in Bryan (see 8.41). In Bryan, the court held that a builder owed a duty to a subsequent purchaser; in Woolcock, the court held that it did not. In Project No 2 Pty Ltd v Cushway Blackford & Associates Pty Ltd [2011] QCA 102 at [14], Muir JA (with whom White JA and Peter Lyons J agreed) said that Bryan was ‘a decision of doubtful authority’ after Woolcock and that earlier decisions of the Queensland Court of Appeal ‘were based on the now discredited principles stated in Bryan v Maloney’. In contrast, none of the judgments in Brookfield Multiplex (see 8.37) suggested that Bryan was wrongly decided, but rather that it was distinguishable on the facts. Gageler J suggested that Bryan remains good law but should be confined to cases involving dwelling houses, where subsequent purchasers are more likely to be vulnerable in the Woolcock sense than were the purchasers of the commercial building in Brookfield Multiplex: see [185]. Whether or not Woolcock ‘discredited’ the decision in Bryan, it would be unfortunate if it were to ‘discredit’ the whole notion of transferred loss as a basis for finding a duty of care. As noted above (see 8.42–8.43), there is no fear of indeterminate liability in transferred loss cases. John Fleming wrote convincingly that application of the ‘exclusionary rule’ (see 8.30) was ‘least compelling’ in such cases.4 Nevertheless, the rise of the concept of vulnerability (see 8.29 and 8.36–8.40) may prove to be the downfall of the concept of transferred loss. In Woolcock (see 8.36) there was transferred loss but no vulnerability, and the High Court held that there was no duty.

The position in other common law countries

8.45 In Mitsui OSK Lines Ltd v The Ship ‘Mineral Transporter’ [1983] 2 NSWLR 564, the defendant ship negligently collided with a ship that was under time charter to the plaintiff. Applying Caltex principles (see 8.32), Yeldham J held that there was sufficient proximity of relationship between the defendant and the plaintiff charterer to give rise to a duty of care, even though the plaintiff charterer did not own the ship, because (at 573): [T]he defendant must necessarily have known that it was likely that a commercial vessel damaged by its negligence would be the subject of a time charter, and that such damage would be productive of … economic loss in the form of loss of the profits the charterer would have made from the use of the vessel during the period when it was laid up as a result of the collision.

8.46 The application of Caltex principles in The Mineral Transporter appeared to be quite correct in the circumstances and it seemed that any appeal to the Court of Appeal of New South Wales and any subsequent appeal to the High Court of Australia would have been unsuccessful. As a result, the defendant appealed directly to the Privy Council: it was one of the last appellants to do so before such appeals were abolished. This choice of forum bore fruit for the defendant, as the Privy Council allowed the appeal: see Candlewood Navigation Corp Ltd v Mitsui [page 435] OSK Lines Ltd: The Mineral Transporter [1986] AC 1. The Privy Council considered the judgments in Caltex at some length before concluding (at 24): [T]heir Lordships have concluded that they are entitled, and indeed bound, to reach their own decision without the assistance of any single ratio decidendi to be found in Caltex.

8.47 Having disposed of Caltex in The Mineral Transporter (see 8.46), the Privy Council went on to return to the old exclusionary rule (see 8.30) that no plaintiff could recover damages for economic loss unless she or he had suffered physical damage or personal injury. As the

plaintiff did not own the ship that was damaged by the defendant, its action failed. The House of Lords has since reaffirmed the United Kingdom’s adherence to the exclusionary rule: Marc Rich & Co AG v Bishop Rock Marine Co Ltd: The Nicholas H [1996] AC 211. It is still the case in the United Kingdom that only the owner of property (or beneficial owner: see Colour Quest Ltd v Total Downstream UK plc [2011] QB 86 (CA)) can recover for economic losses arising from damage to property. 8.48 Until 1 January 2004, New Zealand continued to allow appeals to the Privy Council and continued to regard Privy Council decisions such as The Mineral Transporter (see 8.47) as binding. Even before the abolition of Privy Council appeals, New Zealand courts had held that a builder of premises owed a duty of care to subsequent purchasers of residential homes and the Privy Council acquiesced in that result, despite the fact that it was inconsistent with English law: see Invercargill City Council v Hamlin [1996] AC 624. In North Shore City Council v Body Corporate 188529 (Sunset Terraces) [2010] 3 NZLR 486, the Supreme Court of New Zealand rejected the proposition (recently suggested by Gageler J in Brookfield Multiplex: see 8.44) that a distinction should be made between commercial and residential buildings, so that a builder owes a duty to subsequent purchasers of either. Outside of the sub-category of subsequent purchasers of defective premises, New Zealand continues to adhere to the exclusionary rule denying liability for purely economic loss caused by negligent acts: see Attorney-General v Carter [2003] 2 NZLR 160 (CA); Rolls Royce New Zealand Ltd v Carter Holt Harvey Ltd [2005] 1 NZLR 324; Te Mata Properties Ltd v Hastings District Council [2009] 1 NZLR 460; Queenstown Lakes District Council v Charterhall Trustees Ltd [2009] 3 NZLR 786. 8.49 Canada prefers the Australian approach to the English. In Canadian National Railway Co v Norsk Pacific Steamship Co [1992] 1 SCR 1021, the Supreme Court of Canada considered Caltex (see 8.32), The Mineral Transporter (see 8.47) and many other authorities from several jurisdictions before rejecting the old exclusionary rule and concluding, by a majority, that a defendant might owe a duty not to cause purely

economic loss if there was sufficient proximity between her or him and the plaintiff who suffered the loss. McLachlin J (with whom L’Heureux-Dubé and Cory JJ agreed) expressly adopted the proximity approach suggested by Deane J in Sutherland Shire Council v Heyman (1985) 157 CLR 424; 60 ALR 1. (This is rather ironic in the light of the fact that the High Court has since abandoned that approach itself: see Chapter 5.) However, the Supreme Court of Canada has stopped [page 436] short of the position taken by the High Court of Australia in Bryan v Maloney: see 8.41. In Canada, builders are only liable to subsequent owners for the cost of repairing dangerous defects, and not for the economic loss caused by the fall in the building’s value once a defect is discovered: Winnipeg Condominium Corp No 36 v Bird Construction Co [1995] 1 SCR 85. 8.50 Most states in the United States also adhere to the exclusionary rule, following the decision of the Supreme Court of the United States in Robins Dry Dock & Repair Co v Flint, 275 US 303, 48 S Ct 134 (1927). Robins Dry Dock is a decision about federal maritime law, so it is not binding authority on the common law of the 50 states. Nevertheless, most states follow the principle stated in Robins Dry Dock, namely that there can be no recovery of economic loss without physical injury or property damage: see, for example, 532 Madison Ave Gourmet Foods Inc v Finlandia Center Inc, 727 NYS 2d 49, 750 NE 2d 1097 (CANY, 2001); Coastal Conduit & Ditching Inc v Noram Energy Corp, 29 SW 3d 282 (Tex App, 2000); Duquesne Light Co v Pennsylvania American Water Co, 850 A 2d 701 (Pa Super, 2004); Louisiana Crawfish Producers Ass’n West v Amerada Hess Corp, 935 So 2d 380 (La App, 2006); Terracon Consultants Western Inc v Mandalay Resort Group, 206 P 3d 81 (Nev, 2009); American Petroleum and Transport Inc v City of New York, 737 F 3d 185 (2d Cir 2013). A distinction is made, on grounds of expediency rather than principle, for commercial fishing operators, who are allowed to recover the economic losses they suffer as a result of negligently

caused damage to the waters in which they fish, even though they do not own those waters nor (yet) the fish within them: see, for example, State of Louisiana, ex rel Guste v M/V Testbank, 752 F 2d 1019 (5th Cir 1985) (en banc). Problem 1 – Negligent Misstatement 8.51 Dolly returned to study after having enjoyed a lucrative (but then deteriorating) career at MoneyMakers Stock Brokers. Now a PhD Commerce student at Aspirationville College, Dolly was prodded by some of her real life acquaintances to join InterMeet — to become their online friends and meet a lot of random new ones. Making a multitude of virtual friends and at the same time advancing careers had become all the rage on InterAction, MeetaMate, Careers4U and InterMeet, hailed by many to be the most radical friendship networks in Australia, seriously revolutionising relationships. It didn’t take long for somewhat socially awkward Dolly, under her avatar, ‘Desdemona’, to be prodded by her new InterMeet friends to become friends with even more people. For once in her life, Dolly (who had spent some of her youth in Daisy Bay Youth Detention Centre on fraud charges) actually felt really popular. Unfortunately, she hadn’t met any of her new friends in person. But they were certainly a hoot to hang out with on the web. Desdemona was frequently invited to join a lot of cool groups and clubs because of her awesome avatar and profile as a former stock, bond market whiz (a contrarian with [page 437] a real knack for good bargains) and owner of a $2.5 million home in Mortgagetown, one of Aspirationville’s most sought after suburbs. It even rivalled the posh (but some would say pretentious and vulgar) Daisy Bay riverfront. One such InterMeet club was ‘Intrepid Investors’, an exclusive, private group notorious for (generally) rigorously vetting its membership. It was (usually) only open to Commerce students with first class honours grades, who self-identified as prospective stock and bond market investors. Its home page proclaims, ‘Good-bye regulation! Hello laissez faire! Just like life, the markets’ ups and downs are your responsibility’. After much debate, as an exception to its general policy, the president of Intrepid Investors allowed Polly, a second-year Commerce student who had barely passed first year, to join the group. This was because of Polly’s notoriety as the May 2017 winner of the reality show, Money Mayhem, where she had surprisingly won $250,000. In June, Polly began a discussion with Intrepid Investors, wondering about where she should place her winnings. She said she was keen to hear what the experts among her many Commerce friends had to say. After a lengthy discussion with the group’s 100 members, Desdemona weighed in, in her typically authoritative fashion: Listen up everyone. As I tried to explain, before Prudence so rudely interjected,

when I was in practice at MoneyMakers, a while ago, some ace investment prospects kept coming up. For example, Dirt-Cheap Home Loans was going great guns, brilliantly undercutting the banks with its sub-prime home loans. It even received a triple-A rating in 2006–2007 from a couple of market analysts. It’s pretty amazing that it’s back in business after what happened in 2008, with its disintegration. All so random isn’t it!? But that was then; this is now! Why live in the past, I say? I loved working with that segment of the market and its ‘win-win’ ethos. I ask you, who doesn’t need cheap credit? Who doesn’t want their own home? It’s the Aussie Dream! Lucky for us, these fundamental urges never go away. There sure was some awesome talent running that Dirt-Cheap venture. I guess if it were me and I had a couple of extra bucks lying around, I’d think about a company like the newly invigorated Dirt-Cheap, with its recently awarded triple-A rating from some experts. Long-term government bonds also seem rather attractive — especially those of countries like Venezuela, Brazil, Georgia, Ukraine and Iraq. Such beautiful countries with such rich cultures. Investing in emerging countries’ and some eastern European bonds is, like, so valid. It’s like, so legit. The next day, Polly invested her TV winnings in long-term Ukrainian government bonds and shares in Dirt-Cheap Home Loans. Pryce, who had been denied the right to join Intrepid Investors because he was only an IT student, unsuccessfully tried to hack into the group’s forum. Frustrated, Pryce emailed his friend Polly to hear the latest gossip and hints coming from Intrepid Investors. Polly recounted the online conversation with Desdemona and the others in the group. That day, Pryce also invested $250,000 in long-term Ukrainian government bonds and shares in Dirt-Cheap Home Loans. He did so using his savings, from when he fortuitously sold his dot.com business in 1999, just before that market’s notorious collapse. This was a number of years prior to his return to university as a ‘mature’ student. Not long after Polly and Pryce invested in Dirt-Cheap, recent history seemed to repeat itself, when Dirt-Cheap collapsed yet again, because most of those to whom [page 438] it had lent money could not repay their loans. Polly and Pryce lost their investments in Dirt-Cheap. Remarkably, the aftershocks of the sub-prime mortgage crisis continued to be felt long after 2008. This continued fallout, in conjunction with the shock Brexit referendum result and fears over escalating tensions with North Korea, led to economic meltdowns and significant market jitters in emerging markets and ones which had somewhat precarious political futures, such as Venezuela, Brazil, Georgia, Ukraine and Iraq. Polly and Pryce suffered steep irrecoverable financial losses with their disastrous Ukrainian bond investments. Polly and Pryce sue Dolly. Advise all three. You may assume that their claims are instituted within the time limits (limitation periods) that apply in all jurisdictions.

Discussion Arguments for Polly 8.52 Polly would first argue that Barwick CJ’s requirement of reasonable reliance in the circumstances, as noted in Mutual Life and Citizens’ Assurance Co Ltd v Evatt, is met here. Any argument that the conversation Polly had with Dolly was too informal to be reasonably relied upon is unconvincing. Their discussion involved much more than ‘mere utterances in a social setting’. Dolly’s advice, in effect a recommendation, was provided in a context that was not wholly, let alone primarily, social (despite it being characterised as a ‘social networking site’): it was a restricted InterMeet group, directed to a limited, exclusive class of persons, all of whom were ‘Intrepid Investors’. The prospective investors were all invited by their friends into the group because of their similar interests and objectives. This was not a mere social outing that happened to be online, and could not be characterised as ‘ludicrous’ (as in Chew v Amanatidis). It was serious business, as the name of the group involved in its activities implies. The subject matter, concerning the investment of hundreds of thousands of dollars, was undeniably serious. Similarly, the strict vetting mechanism employed to restrict group membership points towards the formal nature of this forum and the fact that it was reasonable to rely on such advice. Only a select group was accorded the privilege of access to advice from experts like Dolly. It was limited in its scope, with (generally) only students with higher level grades permitted to join. Indeed, because they all (generally) had to be Commerce students, the level of skill of those providing advice and information could be said to be of a very high standard. Polly made the direct request for help; she even asked for experts’ views. Dolly was a self-proclaimed expert who offered an authoritative opinion as to what to do. It was reasonable in the circumstances for Polly to rely on this advice. As Barwick CJ noted in Evatt, these are the kinds of circumstances in which Dolly, in a sense ‘the speaker’, must have realised that Polly intended to act on her advice. The group was designed to facilitate prospective investment ventures (and facilitate some socialising among like-minded capitalists), matching those with particular [page 439] skills with those who might rely upon them. Further, the forum was held under the auspices of a reliable site, InterMeet. Indeed, this was a high status group, with a membership comprised of individuals uniquely qualified to provide an assessment of investment possibilities. It is quite reasonable for a group member to rely on information provided in this type of forum, regardless of how casual the statements might appear to be on the surface. In historical terms, these types of forums are a relatively new way of interacting; they act as channels for information flow. The law has to recognise that different cyberspace

forums have particular codes of conduct and conventions. The kind of medium used to provide advice should not itself be determinative of whether or not it is ‘reasonably’ relied upon. The conversations that take place on a site of this nature must be accorded respect, not only because of the nature of the matters discussed, but also because of the reliance placed by group members on one another, providing important information. Group members rely on the full and frank assessment provided by skilled experts to make wise investment decisions. Indeed, no one was better qualified or more ‘specially skilled’ than Dolly, with her remarkable work record and the fact she was undertaking a doctorate in Commerce. She was best placed among the group to provide information about the capabilities of a company about which she had previous knowledge as well as the potential for enormous returns from investment in long-term government bonds. Moreover, Dolly gave her advice in an authoritative manner. Her profile proclaimed to the cyberworld (and in particular to members of Intrepid Investors) that she was an expert, had the credibility to give expert advice and was not someone prone to casual utterances on matters as serious as money making. As someone familiar with DirtCheap’s performance and the stock and bond markets generally, Dolly was well placed to know about their ability to perform in the future. Her ‘special skill’ or ability to provide this information supports the reasonableness of Polly’s reliance on it. Barwick CJ’s decision in Evatt that ‘special skill’ is a factor affecting reasonable reliance rather than a requirement in itself ‘regained vitality’ according to the High Court in Tepko Pty Ltd v Water Board. Other authorities, such as Shaddock & Associates Pty Ltd v Parramatta City Council (No 1), San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979, Norris v Sibberas, Brewer v AAL Aviation Ltd and Geju Pty Ltd v Central Highlands Regional Council held similarly. Therefore, Polly does not have to prove that Dolly had this special skill to be able to succeed in establishing a duty was owed to her. In any event, even if the Pricy Council view in Evatt were to be followed, which it should not, the facts demonstrate that Dolly did indeed have a special skill, and traded on it in her conversations with Intrepid Investors. Dolly’s relationships on InterMeet appear to have been built upon these types of skills, which she in fact shared with the cyberworld, beyond the Intrepid Investors group (elsewhere in InterMeet). Polly, in receipt of Dolly’s expert advice, depended on it, as an accurate and careful assessment of a company’s future, potential profitability and as reliable general investment advice. She had posed the unambiguous and serious question as to what to do with her money and others responded; Dolly did so with an aura of expertise that was reasonable for a novice (and bare pass student) to rely upon. The advice was clearly the cause of her harm, as the very firm Dolly went out of her way [page 440] to praise as a place in which to invest her winnings was the one that went broke not long thereafter. Similarly, the government bonds cited as ‘especially’ attractive — Ukrainian — were, in fact, disastrous, bearing in mind that country’s precarious political future. As a student who had barely passed first year, Polly was especially vulnerable to Dolly’s

expert advice, which seems to be a factor of recurring importance in the case law on purely economic loss. For example, the court in Australian Executor Trustees Ltd v Propell National Valuers (WA) (affirmed on appeal) held that assumption of responsibility and reliance are factors that provide evidence of the plaintiff’s vulnerability to harm. Polly would note, however, that vulnerability per se is not a specific additional criterion necessary to establish negligent misstatement, as the court held in ABN AMRO Bank NV v Bathurst Regional Council; it is ‘the consequence of, knowledge (actual or which a reasonable person would have) of reasonable reliance by an ascertainable class of persons’, which is readily met on these facts. In any event, even if it were required as a separate criterion, she would satisfy it. Finally, the disclaimer which Dolly will no doubt attempt to rely upon should not be accorded any weight. The words are so vague that they should not allow Dolly to rid herself of responsibility. Moreover, the laissez faire statement was not part of the discussion in the Intrepid Investors forum, but a general comment, like a policy statement, at most highlighting the underlying attitude and values of those managing the group. In any event, this supposed disclaimer should not be given effect because all the other circumstances point towards holding that a duty was owed, as was the case in Derring Lane Pty Ltd v Fitzgibbon. As the courts often have observed, all the circumstances must be considered. Doing so supports Polly’s claim. Arguments for Pryce 8.53 In R Lowe Lippman Figdor & Franck v AGC (Advances) Ltd, an auditor made an audit report to the company whose accounts it had audited, and that company passed the audit report on to a third party, to the knowledge of the auditor. The court held that the auditor did not owe a duty of care to that third party, because it (the auditor) had not intended to induce the third party to rely on the statements in the audit report. Pryce would concede that if the strict Lowe Lippman approach is applied in the present case, it is unlikely that Dolly owed him a duty of care, as there is no evidence that Dolly intended to induce Pryce to rely on her comments in the discussion group. Although Lowe Lippman was cited with approval by members of the High Court of Australia in Esanda Finance Corp Ltd v Peat Marwick Hungerfords (Reg), this new factor — intention to induce reliance — was not adopted by a majority in Esanda Finance as determinative. None of the judges in Esanda Finance took the view that this requirement should be applied where the defendant has assumed responsibility for the accuracy of the information given. In Esanda, Dawson and McHugh JJ emphasised that the lack of an intention to induce is not necessarily fatal to a plaintiff’s claim because other factors may be present that obviate the need for such an intention. A majority of the High Court made the same point in San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979. [page 441] Thus, a duty of care may be imposed by the court if other factors, such as an assumption of responsibility by the defendant, suggest that it is appropriate to do so. An assumption of responsibility is but one factor that could be considered, arguably, as a

facet of the plaintiff’s vulnerability (Australian Executor Trustees Ltd v Propell National Valuers (WA) (affirmed on appeal)) rather than as a special category of liability. Here, Pryce could argue that Dolly gave all members of the discussion group permission to use her advice when they decided how to invest, knowing that she was held in very high esteem by the group. She must have known the consequences of advice provided by an expert like herself, with her lucrative career, PhD studies and multi-million-dollar home. She must have understood that the mere inclusion of her name in the discussion group forum would have a great impact on potential investors interested in making their fortunes, well beyond the supposedly limited formal group membership. Presumably, passing on that advice to interested parties would not be unusual. The potential for serious financial harm that could ensue should have been clear to Dolly, bearing in mind how well regarded she is in her field. Pryce would argue that Dolly assumed responsibility to prospective net users, such as Pryce, by allowing her name to be used on the Intrepid Investors website, where she offered such authoritative, expert advice. In Esanda Finance, Toohey and Gaudron JJ stated that in cases like the present, there is an assumption of responsibility when the defendant knows or ought reasonably to know that the information will or may be acted upon for a serious purpose, and loss may be suffered if it proves to be inaccurate. Dolly ought to have known that the statements she made, and the inclusion of her name on a website designed to facilitate discussion about investment, might be reasonably relied on for a serious purpose. It is difficult to imagine why else she would put up an avatar and profile so full of self-promotion and weigh into the discussion so authoritatively in response to an investment query. Dolly ought to have known that some loss might be suffered by recipients of her views and there could be deleterious consequences if they were not well thought out and properly researched. There was an obvious risk that prospective investors might suffer loss by relying on this advice. Toohey and Gaudron JJ highlighted the importance of the special expertise or knowledge of the information provider, and their special means of acquiring information not available to the recipient. Arguably, Dolly was the only person on Intrepid Investors with this special expertise concerning sub-prime mortgages and expertise on the value of bonds. Toohey and Gaudron JJ did, however, question whether it was reasonable for the recipient to act on that information without further inquiry. Here, Pryce will argue that no further inquiry was necessary, as a great deal of weight and value can and should be attached to the views of an expert with Dolly’s pedigree and stature (having worked at MoneyMakers). Further, with respect to Dirt-Cheap, Dolly had cited the triple-A rating the company had been given. Citing ABN AMRO Bank NV v Bathurst Regional Council, Pryce would also note that the ‘knowledge of the identity of the person or persons to whom a duty is owed is not necessary, or generally of significance, in determining the existence of a duty of care’; further, Dolly knew that potential investors would rely on her opinion in deciding whether to invest. [page 442] Pryce will contend that vulnerability, the increasingly important factor used to determine if a duty is owed in this type of case, is not in and of itself decisive. The court in ABN

AMRO Bank NV v Bathurst Regional Council pointed out that vulnerability is not a specific independent criterion that must be satisfied. As the court in Middleton v Aon Risk Services Australia Ltd held, the plaintiff’s vulnerability is not a single test that replaces the various factors that have determined whether or not a duty exists. For example, reasonable reliance and other factors remain important. Dolly did nothing to refute Polly’s obvious reliance on Dolly’s expertise, when she was participating in the discussion about investment prospects. Dolly likely knew that Polly was not as bright as the others in the group. Therefore, she should have taken greater care when offering her advice. She also should have known that this kind of advice would go beyond the confined world of the Intrepid Investors site. That is, Dolly must have known that Polly would pass on hot tips of this nature to others with cash to spare. Although Dolly did not specifically tell anyone to invest in Dirt-Cheap or Ukrainian government bonds, by saying that this is what she would do, she ought to have known that recipients of this information would act on it. Pryce may, however, acknowledge that because of his previous experience and the fact he was not given the advice directly by Dolly, satisfying some of these factors (including vulnerability) may be more difficult than in Polly’s case. Pryce may further note that in Barclay v Penberthy (arising in a somewhat different context — a negligent act rather than a negligent statement), the High Court seemed to suggest that vulnerability is not required in all economic loss cases (although it may continue to be a relevant factor in most). Arguments for Dolly with respect to Polly’s claim 8.54 The requisite ‘reasonable reliance’ needed to establish a duty of care to Polly cannot be established on these facts. Polly contributed to her own loss by relying on the online discussion. To do so was not reasonable in the circumstances. Moreover, Polly was not vulnerable in the legal sense. Even though Dolly’s comments in the discussion forum concerning investments and Dirt-Cheap were provided directly to Polly (and 100 others), it was not reasonable for Polly to rely on them. As Tepko Pty Ltd v Water Board illustrates, the reasonableness of the plaintiff’s reliance on the defendant’s statements depends on all the circumstances of the case, including the context in which they are given. A High Court majority in Tepko held that a duty was not owed because in the circumstances it was not reasonable to rely upon the ‘ball-park’ figure provided by the defendant — a reluctant participant, who resisted giving the information until it eventually ‘caved in’. Further, as in Tepko, Polly had access to expert advice (beyond ‘Desdemona’) at all material times. This case also highlights the importance of the context in which the advice was given, which surely thwarts any attempt by Polly to argue her supposed ‘reasonable reliance’ on Dolly’s comments to the group. Discussing ‘reasonable reliance’ in Mutual Life and Citizens’ Assurance Co Ltd v Evatt, Barwick CJ stated that utterances in the course of social intercourse with no thought of legal consequence cannot be relied upon to found a duty of care. In Mohr v Cleaver, an accountant did not owe a duty of care when he gave investment advice over the telephone, because the recipients had merely asked the accountant for an ‘off-the-cuff’ opinion and had not made it clear that they were seeking considered [page 443]

advice. In Shaddock & Associates Pty Ltd v Parramatta City Council (No 1), no duty arose in respect of informal information given over the telephone. (Indeed, in that case, the duty arose with respect to the written request.) Surely, any attempt to find a duty here is even less plausible, based on the casual nature of the conversation, the informal medium used for the discussion and the less-than-considered nature of the advice bearing in mind the curious context in which it was sought. This was, after all, a ‘social networking’ meeting site, where nonsense chatter and a degree of bravado was prevalent. None of it should have been taken seriously. Gray J’s comments in Chew v Amanatidis are apt. There was nothing ‘businesslike’ about Dolly’s InterMeet discussion. Indeed, it would be ‘ludicrous’ to give it that import. In Chew, the ‘proposed investment was a preposterous proposal’, at least for anyone with a ‘modicum of commonsense’. Here, the occasion and circumstances in which the chat about investment was made was similarly devoid of any sense of commerciality. This was nothing more than a chat among friends, like that which takes place at a social gathering or (tedious) party. Dolly would argue that it would be inconceivable for a discussion in InterMeet to be characterised as anything but a series of casual, informal comments in a social setting. The rationale for starting up this particular group with its particular objectives is irrelevant to a consideration of whether the group’s chatter is something that should be relied upon. This was nothing more than a social chat on a social site. Dolly also would highlight the fact that Polly prompted the conversation and that Polly should not have been part of the discussion group in the first place, as she was far below the standard of those who merited the offer of membership in the group. Indeed, the fact that Polly, with her barely passing grades, was the only group member who made this poor personal investment choice should not go without notice. This was no doubt because of her unreasonable reliance on what was mooted and informally discussed in the forum. No one else took the comments, which were part of casual web-based social intercourse, seriously. Dolly’s off-hand interjections were little more than utterances (Evatt) or off-the-cuff comments (Mohr). In terms of context, this is a world apart from a case like ABN AMRO Bank NV v Bathurst Regional Council, where the considered opinion of the rating agency Standard and Poors, which was relied upon by local councils, was at issue. Polly cannot demonstrate that she was in any way vulnerable. Vulnerability is an overwhelmingly important factor to be assessed in cases like this. Its significance is highlighted in Dartberg Pty Ltd v Wealthcare Financial Planning Pty Ltd, Street v Luna Park Sydney Pty Ltd, Hardie Finance Corp Pty Ltd v Ahern (No 3), Girotto v Phillips Fox, Australian Executor Trustees Ltd v Propell National Valuers (WA) Pty Ltd (affirmed on appeal), Meredith v Commonwealth (No 2), Owners – Strata Plan No 61288 v Brookfield Australia Investments Ltd and Woolcock Street Investments Pty Ltd v CDG Pty Ltd. (Interestingly, Woolcock’s oft-cited consideration of this factor arose in a context that does not concern negligent misstatement.) In Australian Executor Trustees Ltd v Propell National Valuers (WA) Pty Ltd (affirmed on appeal), the court stated that ‘assumption of responsibility’ is one factor that, like reliance, indicates the plaintiff’s vulnerability to harm. Dolly would acknowledge that in Middleton v Aon Risk Services Australia Ltd, the court

held that although the plaintiff’s vulnerability is a common thread in this context, it does not replace the various factors with a single test. Further, even though ABN [page 444] AMRO Bank NV v Bathurst Regional Council may have noted that vulnerability is not itself a necessary criterion to establish negligent misstatement, its significance cannot be denied, as so many decisions have underlined its importance. Further, despite the fact that the High Court in Barclay v Penberthy, a negligent act case, seemed to suggest that vulnerability is not required in all economic cases, it remains a relevant factor in most such cases. Regardless of its exact status, vulnerability clearly is a key element relevant to determining if a duty should be owed. Its absence here should thwart Polly’s claim: Polly is the author of her own misfortune as she could have protected herself from harm by seeking additional formal advice before making such significant investment decisions. It seems extraordinary that Polly would invest on the basis of ‘Desdemona’s’ chatter. All those participating in a discussion group should have known it would be unreasonable to rely on anything said in social networking sites, especially when the information could have been verified (but was not). Polly, an investor, ought to have contacted one of Aspirationville’s many licensed stockbrokers to investigate the viability of Dirt-Cheap’s future. Further, a wide range of market analysts and commentators could and should have been consulted to provide advice on investing in bonds of emerging markets or countries like Venezuela, Brazil, Ukraine, Georgia and Iraq before investing such a sizable sum. (Indeed, Polly herself ought to have exercised greater care when giving advice to Pryce — someone she knew personally. She should not have passed on Desdemona’s informal comments to an outsider when they were made to an exclusive discussion group.) Polly could and should have received formal face-to-face advice from a number of reputable sources who could have offered considered opinions. By not seeking that kind of advice, Polly was not vulnerable in a legal sense. The absence of vulnerability is further indicated by the fact that Polly had the capacity to form her own judgment about Dirt-Cheap’s potential and its future viability. For example, Polly should have checked its price to earnings ratio. Dolly would further note that she did not hold herself out as someone with a ‘special skill’ when she was having a chat in the Intrepid Investors group. In a sense, Desdemona did — whoever she might be. This was little more than Dolly’s InterMeet persona. She could have been anyone. All she did was claim to have had a lucrative career at MoneyMakers. In fact, she was allowed to join the group because of her Commerce studies, like the others, and not necessarily because of her former employment capacity. While Dolly should acknowledge that having a ‘special skill’ is not a separate requirement according to the cumulative effect of authorities such as Shaddock & Associates Pty Ltd v Parramatta City Council (No 1), San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979, Tepko Pty Ltd v Water Board and Brewer v AAL Aviation Ltd, she should maintain that it is

nevertheless an important factor for a court to consider, among all the circumstances, when assessing the plaintiff’s reasonable reliance on the statement. Dolly can escape any potential liability by pointing to the disclaimer included on the website. It clearly proclaimed to all participants that individuals bear their own responsibility for what happens when they invest their personal fortunes. This is not the kind of case where the disclaimer should be ignored because the other circumstances point towards finding a duty, as in Derring Lane Pty Ltd v Fitzgibbon. [page 445] As was noted previously, there are no such factors in this case that point towards such a duty. Further, it is not as if casual comments made in this forum were the only source of information on which Polly could have based her decision to invest in Dirt-Cheap and Ukrainian government bonds (or not). This is quite different from a local authority attempting to disclaim responsibility, when it is the sole source of information, as in Burke v Forbes Shire Council and Mid Density Developments Pty Ltd v Rockdale Municipal Council. There were many places to which Polly could have turned in order to find out more about this segment of the market and Dirt-Cheap’s current position in it, as well as the potential for catastrophic problems in politically unstable countries like Iraq and Venezuela. Dolly would also note that some of her brief comments in the discussion group were based on her recollection that Dirt-Cheap had been a successful business venture. She could argue that she was in good company in not expecting the enterprise to fail again, as this sort of collapse did not seem likely after the company had recovered from its previous disintegration. (Its previous failure in 2008, like so many other financial lender failures, had confounded experts all over the world; further, Dirt-Cheap itself had twice enjoyed a triple-A rating (as assessed by some experts).) Therefore, anything she said that may or may not have been relied upon by Polly could not be said to be the cause of Polly’s loss. Considering all the circumstances, the supposed reliance here on Dolly’s statement, made directly to Polly (and 100 others), was unreasonable. So too is any suggestion that this caused Polly’s harm. Polly’s own act of investing without meticulously checking into the stock and bond markets’ prospects is the cause of her loss. With respect to DirtCheap at least, she could perhaps blame the industry regulator that allowed this type of business to crumble, yet again. Or, somewhat more philosophically, she could write this experience off to ‘bad luck’ and see her loss as typical of those that investors regularly encounter and sustain. Arguments for Dolly with respect to Pryce’s claim 8.55 Dolly did not make any statements directly to Pryce. In Esanda Finance Corp Ltd v Peat Marwick Hungerfords (Reg), the High Court of Australia held that the defendant auditor did not owe a duty of care to anyone other than the company being audited. That decision suggests that the maker of a statement will seldom owe a duty of care to anyone other than the immediate recipient. While Dolly would recognise that it is

possible to find such a duty, special circumstances have to exist to justify its imposition. Those circumstances are glaringly absent here. McHugh J asserted that the law in Australia was correctly stated by the Appeal Division of the Supreme Court of Victoria in R Lowe Lippman Figdor & Franck v AGC (Advances) Ltd. Here, in the absence of a direct request by Pryce, the plaintiff, for the information provided by Dolly, the defendant, or an assumption of responsibility by Dolly, there can be no duty unless Dolly intended to induce the recipient of this information, Pryce, to act upon it. McHugh J stated that there is no good reason for extending the liability of auditors to people whom the auditor knows or ought to know will rely on the audit where the auditor has not assumed responsibility to those people or intended to induce them to rely on the audit. Similarly, mere knowledge (or presumed knowledge) that the information will be communicated to someone like Pryce is not enough to impose a duty. In fact, there was no reason for Dolly to [page 446] expect wide-ranging communication, unlike the circumstances involving the high profile rating agency in ABN AMRO Bank NV v Bathurst Regional Council. Dolly would highlight the fact that Pryce did not make a request of Dolly to provide him with the investment advice. Although a request is normally required, Dolly would concede that it is not essential, noting San Sebastian Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979 in this regard. Further, there is no suggestion that she intended to induce potential investors such as Pryce to act on her comments about Dirt-Cheap and government bonds, which were made to an exclusive, restricted group of academically gifted (aside from Polly) capitalists. Dolly’s comments cannot be characterised as a formal recommendation. They amounted to little more than casual chatter made to 100 of her best friends. Further, if Pryce were to succeed in arguing that Dolly assumed responsibility to him, there would be no limit to her potential liability when she made these informal comments, especially when so many interactions in cyberspace can so readily go viral. This claim perfectly illustrates why the courts have an understandable underlying fear of indeterminate liability in this area of the law, and the rationale for not finding a duty of care. While Dolly acknowledges the court’s comments in ABN AMRO Bank NV v Bathurst Regional Council regarding indeterminate liability, Dolly would note that unlike the rating agency in that case, her casual offhand utterances were provided with the understanding and knowledge that their reach would be confined to those in her limited online group; they were not intended to be seen by the world at large. Pryce may contend that Dolly knew or at least ought to have known that Polly was going to use Dolly’s expert advice to help Polly and her friends make investment decisions. In response, Dolly would argue that when she made her comments she did not assume responsibility to anyone about anything. She would have expected potential investors such as Pryce (and Polly) to contact licensed stock brokers, fund managers and the like to provide a reflective, serious and formal assessment of where to best spend such large sums of money. They themselves should have assessed the viability of the bond market and its potential as well as the state of the sub-prime mortgage market and

relevant trends, including Dirt-Cheap’s place in it. It is not as if Dolly had provided a considered opinion or recommendation — for example, a written letter of advice on her former firm’s letterhead. If Pryce had contacted Dolly directly about Dirt-Cheap (or indirectly via Polly and the discussion group) and Dolly had given Pryce an inaccurate assessment, then, for argument’s sake, she might be said to have assumed responsibility to Pryce as the recipient of the information. But that hypothetical scenario is far removed from what occurred here. All the comments made on the internet were not provided directly to Pryce, so no assumption of responsibility can be founded on Dolly’s interjections. In Ta Ho Ma Pty Ltd v Allen, the court held that the expectation of reliance on the statement is often determinative of whether there should be a duty. The class of persons to whom a duty of care is owed will normally be confined to those persons whose reliance on the information is reasonable in the circumstances. Reliance in that case was unreasonable, as additional inquiries ought to have been made. Proper inquiries should have been made with respect to a matter as important as investing $250,000. In these circumstances, there is no reason to dispense with the requirement of an intention to induce reliance. Dolly did not owe Pryce a duty of care. [page 447] It should also be noted that Pryce had apparently been a very successful businessperson, having actually made money out of his dot.com business before that segment of the market collapsed. He cannot claim that his losses were caused by Dolly’s (or Desdemona’s) comments. Even in a causal sense, it is the stock market, bond market and political environment that are responsible for what happened. As Dolly would note, who could have predicted Brexit and the economic turmoil and political instability it has unleashed? Moreover, with respect to Dirt-Cheap, why not sue the regulators and those that gave Dirt-Cheap its recent triple-A rating, as in ABN AMRO Bank NV v Bathurst Regional Council? Surely, they are more responsible than Dolly (or is it Desdemona?). In any event, Pryce was clever enough to have avoided the dot.com collapse several years ago. As a sophisticated investor, he should have exercised the same prudence on this occasion (as noted in Esanda Finance). He, like Polly, was not vulnerable in the legal sense, as explained, considered and found absent in a series of cases, including Esanda Finance, Woolcock and Brookfield Multiplex Ltd v Owners Corp Strata Plan 61288. As a large number of authorities have noted (see the cases cited in Dolly’s response to Polly’s claim) this is a common thread in negligent misstatement cases. There is nothing about Pryce’s circumstances (a one-time businessperson who had opportunities to consult experts before making his unfortunate investments) that make him ‘vulnerable’, or unable to protect himself from harm. As Dolly notes in her response to Polly’s claim, even though ABN AMRO Bank NV v Bathurst Regional Council stated and Barclay seemed to suggest that vulnerability is not required in all economic loss cases, it is a relevant factor in most and is most certainly a significant, necessary and missing element here.

Problem 2 — Negligent Misstatement 8.56 Hyram (Hy for short) Con-Scept was a final-year Marketing student at Daisy Bay University, a private institution. Seeking employment upon graduation, he asked his tutors to act as his referees. They refused because they felt they did not know Hy well enough. Exasperated, Hy steeled himself to send a text message to the Head of School, Dr Dour, to see if she would be willing to act in the capacity of referee. Earlier that year, the formidable and well-respected Dr Dour had taught Hy (and 40 others) in the finalyear subject, ‘App Ads to Die For’. Frantic with her research commitment deadlines, Dr Dour hastily and impatiently agreed to Hy’s request, texting, ‘Crazy busy at moment. But sure, yeah, go ahead. Put name down on CV. Gotta’ run.’ One week later, at a ‘Schmooze with the Profession’ cocktail party organised by Daisy Bay University for final-year students, Dr Dour ran into Sara Belum, a tedious former classmate who now manages a recruitment firm, Pathways Unlimited. Sara said to Dr Dour, ‘We’re looking for recruits with excellent communication skills who can relate well to clients. Self-starters, who’ll swim not sink when thrown in the deep end. You’re Hy Con-Scept’s referee aren’t you? I saw your name on his CV. Bit of a bright spark I gather?’. Anxious to get away from sycophantic Sara’s unctuousness without wanting to appear too rude, Dr Dour replied curtly, ‘Uh-huh. He wrote a pretty good essay about how to target the young demographic. Nice enough fellow. Gotta’ run’. [page 448] Based on Dr Dour’s comments, Sara recommended Hy to Premier Promos, an advertising agency that was keen to hire top-notch recent graduates. After a few weeks working at Premier, the managing director asked Hy, on short notice, to help present a marketing campaign for the CEO of Daisy Bay Bottling Pty Ltd, manufacturer of ‘South Pacific Shakers’, one of Premier Promos’ most lucrative clients whose market share was floundering. Hy’s presentation failed miserably. He was tongue-tied, incoherent and totally unprepared. Premier Promos lost the Daisy Bay Bottling account and revenue amounting to hundreds of thousands of dollars. In the meantime, Pathways Unlimited ceased operation, having lost its most important account, Premier Promos. As it turns out, Dr Dour had never observed Hy make an oral submission. Her direct contact with Hy arose from lecturing him and grading his quite well-researched essay. While he was a pleasant enough presence in class, and always called her Dr, he was not particularly memorable. Indeed, she may have confused him with Hy Phlier or Hy AshCheever, who were also in that same class. Premier Promos and Pathways Unlimited sue Dr Dour. Advise all three.

Problem 3 — Negligent Acts

8.57 Serenity Shire, which encompasses Aspirationville and neighbourhoods like Serenity Springs, located near the rustic Rushing River, was about to celebrate its month-long horse racing carnival season, a huge boon to the local economy because of the tourist dollars it generated. Even the communities of Daisy Bay, some 30 kilometres away, and Fairview, even further away, benefited enormously from the influx of activity for the Serenity Springs Spring Carnival, which was capped off by the Serenity Cup. Dakota Horse Breeders and Jockey Trainers Pty Ltd, located 200 kilometres away and in a different state to Serenity Shire, was home to a number of the thoroughbreds who usually ran in the Serenity Cup. About three months ago, a Japanese breeder sold Saki, a seemingly splendid mare, to Dakota. One month later, Dakota sold Saki to the Pharlap Consortium, located in Serenity Shire. The Pharlap Consortium had intended to run Saki in the Serenity Cup, but in fact decided, a week later, to sell Saki to the Primavera Group. One month before the carnival was about to commence, Saki and Whiskey Sour (one of the punters’ favourites, also owned by Primavera), were diagnosed with the debilitating disease, ‘equine flu’. Tests revealed that Saki had been infected for many months. About four months ago, 20 cases of equine flu had been identified in Japan by Japanese horse breeders. Experts later determined that when Dakota owned Saki, it carelessly ignored clear evidence that Saki had shown symptoms of the virus. Saki and Whiskey Sour were the first cases of equine flu reported outside Japan. Equine flu is spread when an infected horse comes into close contact with another horse and there is an exchange of fluids. Its spread can be contained by isolating [page 449] flu-infected horses and treating them with antibiotics. An infected horse should not be in contact with other horses until it is unequivocally symptom-free, at least three months after its condition normalises. There was also some speculation that equine flu could even spread to humans who are in close contact with the horses, if individuals suffer from immune deficiencies, including cancer sufferers undergoing chemotherapy treatments, people with Hepatitis C or HIV, infants and the elderly. The Australian Department of Gambling and Entertainment advised that ‘no one in Australia should be overly concerned because there was no concrete evidence that equine flu had yet spread to humans’. News of the virus rocked the racing world. All of Dakota’s and Primavera’s horses had to be quarantined; therefore, none of them was allowed to run in the Serenity Cup. While the Cup was held, it had its lowest attendance on record, as no one wanted to see thirdrate horses run. Network 42 decided not to show the race, as it had predicted it would get disastrous ratings if it were televised. Pakuna, a jockey, did participate. She lost her balance and fell off her horse, just as she was about to cross the finish line. Experts later determined that Pakuna’s loss of balance, acute pain and severe breathing difficulties were the result of her having contracted the equine flu. Pakuna had trained for years with Dakota, and had ridden Saki several times during the period in which Dakota owned the horse. Pakuna had

insisted on riding in the Cup, resisting what she called the equine flu ‘hysteria’ as just that — unwarranted fear. Over the course of the month immediately leading up to the Cup and for a long time afterwards, Serenity Shire (and its council) lost millions of dollars in tourist revenue. Daisy Bay’s Cupid’s Kitchen (famous for its gamy meats and chicken Kievs) closed down for quite a while. Its lost trade, in conjunction with the expenditure it had incurred renovating its premises in anticipation of the Spring Carnival season’s increased trade (which never materialised), made operating the delightful bistro unsustainable. Moreover, the public feared catching the flu. Indeed, Cupid’s Kitchen’s fate was sealed when news emerged that its part-time waitress, Pakuna, was the jockey who collapsed at the Cup. Even The Punter’s Pub, in Fairview, over 50 kilometres away, shut down for a number of months as it was so dependent on carnival-generated revenue (which had not been forthcoming). Part-time staff that in the past had been hired to pull beer over this normally busy period were laid off. This included single mum Pene who, unable to earn extra money to pay her enormous Daisy Bay Uni fees, had to defer her studies for a year. She thinks she may have to drop her law course, including her favourite subject, ‘Torts Tragedies’, with Dr Dashing. Chantal’s Chateau de Chapeaux, a ‘splendid’ (in its own words), widely advertised vintage millinery shop that had served Serenity Shire for over 100 years, also ceased trading. Dakota Horse Breeders and Jockey Trainers Pty Ltd is sued. For the purposes of argument, it admits carelessness. However, it denies that it owed a duty of care to any of the plaintiffs, which include the Primavera Group, Serenity Shire Council, Cupid’s Kitchen, The Punter’s Pub, Pene and Chantal’s Chateau de Chapeaux. Advise the parties. The story continues, in Chapter 9, ‘Mental Harm’ (see 9.22).

[page 450]

Discussion Arguments for the Primavera Group, Serenity Shire Council, Cupid’s Kitchen, The Punter’s Pub, Pene and Chantal’s Chateau de Chapeaux 8.58 The losses suffered by the Primavera Group, Serenity Shire Council, Cupid’s Kitchen, The Punter’s Pub, Pene and Chantal’s Chateau de Chapeaux are purely economic, as they did not, strictly speaking, suffer any damage to their own property as a result of Dakota Horse Breeders and Jockey Trainers Pty Ltd’s negligence (conceded for the sake of argument). Although the Primavera Group may try to classify its loss as property damage, it will likely have difficulty doing so. When it bought Saki, the horse was already infected with the flu. Therefore, the Primavera Group could not argue that it

suffered property loss when the horse was unable to run, such that its business plummeted. Rather, it would likely concede that its loss was purely economic in that it paid more for Saki than the horse was worth, in a manner similar to Bryan v Maloney. While there has traditionally been a resistance to allowing recovery for purely economic loss, the ‘exclusionary rule’ (or ‘bright line rule’) is not the current Australian position. That said, there is no single test for finding the existence of a duty of care in this kind of case. In Caltex Oil (Australia) Pty Ltd v The Dredge ‘Willemstad’, the defendant negligently severed a pipeline at the bottom of Botany Bay, causing purely economic losses to the plaintiff, who owned an oil terminal at the end of the pipeline, and who suffered extra expense transporting oil by road. The High Court of Australia unanimously held that the plaintiff could recover those losses, even though it had not suffered damage to property itself. Gibbs CJ and Mason J held that the plaintiff could recover damages for its purely economic loss because the defendant knew or ought to have known that the plaintiff individually, and not as a member of an unascertained class, would be likely to suffer economic loss as a result of its negligence causing damage to the property of a third party. Here, the plaintiffs are part of a well-defined group of enterprises, ranging from the council to businesses connected closely to the racing industry. Each one could be identified with precision. Even though Dakota may argue it did not have actual knowledge of every plaintiff by name, such as ‘Cupid’s Kitchen’, ‘The Punter’s Pub’ and ‘Chantal’s Chateau de Chapeaux’, it certainly had the requisite means of knowledge. It was eminently knowable that nearby businesses, comprising an eatery, pub and fancy hat shop, would suffer economic loss as a result of its negligence. The Primavera Group also may argue that a duty is owed to it on the basis that its circumstances should be characterised as constituting a ‘transferred loss case’, to use the language of Doyle CJ in Seas Sapfor Forests Pty Ltd v Electricity Trust of South Australia. The court in Seas Sapfor held that there is no obvious reason for denying recovery in these types of cases, because there is no risk of indeterminate liability. In the present case, Dakota Horse Breeders and Jockey Trainers Pty Ltd knew or ought to have known that the Primavera Group’s loss is similar to that which the Pharlap Consortium would have suffered had Saki caused economic hardship a short while earlier, when the Pharlap Consortium was still Saki’s owner. [page 451] This is similar to Bryan v Maloney. Although Bryan may have been discredited somewhat (in Project No 2 Pty Ltd v Cushway Blackford & Associates Pty Ltd, where the court stated that Bryan was ‘a decision of doubtful authority’ after Woolcock) it has not been authoritatively overruled. In fact, none of the judgments in Brookfield Multiplex v Owners Corp Strata Plan 61288 suggested that Bryan was wrongly decided, but rather that it was distinguishable on the facts. The loss suffered by the plaintiff in Bryan was the very loss that the first property owner would have sustained had she remained the owner of the house. The loss was simply transferred from the first owner to the plaintiff when the house was sold. Here, the loss that would have been suffered by the Pharlap Consortium was merely transferred to the Primavera Group. One claimant can readily be

substituted for the other without increasing the defendant’s liability. It should perhaps be noted that Gageler J suggested that while Bryan remains good law it should be confined to cases involving dwelling houses, where subsequent purchasers are more likely to be vulnerable in the Woolcock sense than were the purchasers of the commercial building in Brookfield Multiplex. The Primavera Group is an ‘identifiable plaintiff’, like those claimants in McMullin v ICI Australia Operations Pty Ltd, who unwittingly bought already-contaminated cattle. If the Pharlap Consortium had suffered the loss, it would have been recoverable. The Primavera Group should have the same rights. It is conceded that the other plaintiffs will have more difficulty arguing on the basis of ‘transferred loss’ and likely will be held to be outside the scope of that characterisation, as was the case with some of the plaintiffs in McMullin, who were unable to establish the required ‘connecting link’ (or ‘cattle (or meat) trail’). Further, it is acknowledged that since Woolcock, reliance on transferred loss cases could be said to be somewhat precarious. Even if the plaintiffs cannot fit their claims within the terms of ‘transferred loss’ cases, and even if those cases are somewhat precarious, this does not necessarily mean that they are not owed a duty of care. All plaintiffs can rely on the High Court of Australia decision, Perre v Apand Pty Ltd, where a duty was held to exist despite the fact that it was not a ‘transferred loss’ case. Of course, the fear of indeterminate liability is more pressing in the context of loss that is non-transferred and purely economic; however, that concern can be overcome here. Even though the High Court delivered a number of separate judgments in Perre, their reasoning had several common features that are relevant here and support finding a duty. In Perre, the plaintiffs who lost their Western Australian markets, even though their own potatoes were not infected, successfully claimed damages for their economic losses. They failed in the lower courts, where Caltex was strictly applied, and because proximity was absent (among other factors). The High Court, however, found a duty, even though there was no direct relationship between the plaintiffs’ loss and that suffered by the affected farm, and no direct dealings between the plaintiffs and the affected farm to transfer the latter’s loss to the former. Like the Caltex judges, the judges in Perre emphasised the importance of the fact that the class of affected plaintiffs was of determinate size and readily ascertainable makeup (McHugh J, for example, used an ‘incremental’ approach to make this determination). This fits these facts. Although negligence by Dakota Horse Breeders and Jockey Trainers Pty Ltd might have caused losses to a broad range of persons, the existence of such a potentially wide class does not alter the fact that the reasonable person in Dakota’s position would have realised that an ailing Saki would cause loss [page 452] to neighbouring businesses, which are ascertainable enterprises or individuals. In this part of the country during this limited period of time, when the Spring Carnival has its most significant economic impact, the potential class of persons (including enterprises like the Punter’s Pub and employees, like Pene) directly affected by Dakota’s

carelessness is not so extensive that a duty should be denied. Therefore, these plaintiffs could argue that indeterminate liability is not an issue. Applying Hayne J’s approach in Perre, where he held that liability was not indeterminate because it was possible for the defendant to identify precisely who would be affected by an outbreak of bacterial wilt caused by its negligence, the same could be argued on these facts. It is clear who would be affected by negligence: the boundary of liability (not unlike the 20-kilometre quarantine area prescribed in the Western Australian statute in Perre) extends to Fairview, which appears to be the last outpost of businesses potentially affected by Dakota’s carelessness, and part of this limited and ascertainable class. If the court were to compare all the plaintiffs, Dakota would have the most difficulty suggesting that the Primavera Group is not part of an ascertainable class. Clearly, the Primavera Group should be owed a duty with respect to its inability to pursue its livelihood, as a result of the quarantine imposed on its horses, including Whiskey Sour, the punters’ favourite; all of this stemmed from Dakota’s carelessness. Perre stressed the importance of several other factors. The plaintiffs’ vulnerability featured heavily in the Perre judgments in the sense of their inability to do anything to protect themselves from the harm that befell them. It was an important consideration for McHugh J as well as Gummow J and Gleeson CJ (the latter two using a ‘salient features’ test, based on Stephen J in Caltex) to see whether a duty is owed. Moreover, the absence of vulnerability was critical to the plaintiff’s failure in Woolcock Street Investments Pty Ltd v CDG Pty Ltd and Brookfield Multiplex Ltd v Owners Corp Strata Plan 61288. A large number of cases have highlighted its significance, including Precision Products (NSW) Pty Ltd v Hawkesbury City Council, Rail Corp of New South Wales v Fluor Australia Pty Ltd, Papadopoulos v MC Labour Hire Services Pty Ltd (No 4), Western Districts Development Pty Ltd v Baulkham Hills Shire Council and Gwam Investments Pty Ltd v Outback Health Screenings Pty Ltd. This factor warrants significant attention in a case like this. The parties will argue that vulnerability is satisfied here. All the plaintiffs were vulnerable to the Spring Carnival operating as a successful venture, to which Dakota’s supply of horses (and jockeys) was a significant contributing factor. Dakota’s carelessness brought it all to a halt. They will all contend that during this period they were extremely dependent on the success of the carnival for their livelihood, inextricably linked to breeders like Dakota. They were bound to suffer economic loss if the carnival was a failure. With respect to Serenity Shire, while it was not totally dependent on healthy horses for its economic welfare, this event was vitally important to the wellbeing of the communities it embraced, who were served by its council. Here, this salient feature is met, especially with respect to plaintiffs like the Primavera Group, which was unable to do anything to avoid suffering devastating economic loss as a result of the quarantine. However, as was noted in Western Districts Development Pty Ltd v Baulkham Hills Shire Council, even though vulnerability is important in this type of case, it is not [page 453] the only factor that must be considered in the multi-factorial approach to deciding whether or not a duty of care is owed. In the light of Barclay v Penberthy, it should be

considered one of several factors, such that no single test can be used to determine duty questions in economic loss contexts. Further, the court in Apache Energy Ltd v Alcoa of Australia Ltd (No 2) stated that ‘there is no binding authority that vulnerability is a necessary condition of a duty of care to avoid pure economic loss’. Therefore, although the salient feature of vulnerability may be on the ascendancy, featuring in the four different judgments in Brookfield Multiplex Ltd, for example, it is not of itself determinative of the duty question. In fact, this may be of assistance to those plaintiffs who find it difficult to establish this feature on these facts. Another ‘salient feature’ aside from indeterminacy and vulnerability, also important to McHugh J, is the defendant’s knowledge of the risk of harm to the plaintiffs. The plaintiffs may argue that Dakota Horse Breeders and Jockey Trainers Pty Ltd had knowledge of the fact that their businesses (and Pene’s livelihood) were intimately connected to the Spring Carnival’s success as they were part of an entertainment and food industry that had little basis for existence during this period, aside from being able to capitalise on the racing season. Indeed, the Primavera Group and Chantal’s had no other basis for financial viability. Further, Dakota’s Horse Breeders and Jockey Trainers Pty Ltd had a great deal of control over the economic activities in Serenity Shire during this period, being responsible for many of the horses competing in the Cup. In these circumstances, none of the plaintiffs had any way of knowing about the risk to which they were being exposed and had no avenue to protect themselves against it — they were vulnerable to Dakota’s careless conduct. The linkage of the defendant’s control with the plaintiffs’ vulnerability points towards establishing a duty. These facts disclose a highly connected series of relationships built around one economic activity that was vital to the community — stretching from the Punter’s Pub to Dakota. Arguments for Dakota Horse Breeders and Jockey Trainers Pty Ltd 8.59 The Primavera Group, Serenity Shire Council, Cupid’s Kitchen, the Punter’s Pub, Pene, and Chantal’s Chateau de Chapeaux have all suffered a purely economic loss. While it is true that Australia does not favour an ‘exclusionary rule’ (or ‘bright line’ rule) to recovery for purely economic loss, the kinds of circumstances in which recovery is and should be permitted are nevertheless limited and circumscribed. Fear of indeterminacy and the unfair burdens imposed on potential defendants are of utmost importance and concern when business ventures such as Dakota Horse Breeders and Jockey Trainers Pty Ltd are said to owe duties of care for purely economic loss to plaintiffs like those litigating here: the Primavera Group, Serenity Shire Council, Cupid’s Kitchen, the Punter’s Pub, Pene, and Chantal’s Chateau de Chapeaux. These considerations should operate to negate finding a duty here. As a general rule, damages are not recoverable for purely economic loss. Cases permitting recovery are exceptional. In Caltex Oil (Australia) Pty Ltd v The Dredge ‘Willemstad’, the High Court of Australia held that damages for purely economic losses are recoverable, but only if certain conditions are met. According to Gibbs CJ and Mason J in Caltex, the defendant owed the plaintiff a duty of care because it had [page 454]

knowledge, or the means of knowledge, that the plaintiff individually, and not merely as a member of an unascertained class, would be likely to suffer economic loss if the defendant failed to take care. Here, the businesses (and Pene, an individual) claiming a duty was owed to them are merely part of an unascertainable cluster of claimants, who suffered financial loss as a consequence of the failure of each enterprise to sustain its financial viability. Because this was the result of their own personal responsibility, liability here should not be imposed on this defendant. As an indeterminate class of persons they do not meet Mason J’s criteria, as outlined in Caltex. To find a duty, the knowledge of risk required of the defendant should be knowledge at the time of the negligent act. It is acknowledged that when Dakota sold Saki to the Pharlap Consortium, it could have reasonably foreseen that a number of enterprises might suffer purely economic loss if the horse were ill and possibly out of commission for a period of time. These included those businesses feeding off the tourist trade generated by the Serenity Springs Spring Carnival. However, Caltex makes it clear that reasonable foreseeability of economic loss is not sufficient to give rise to a duty of care. This is endorsed in Perre v Apand and Woolcock Street Investments Pty Ltd v CDG Pty Ltd. (Knowledge is considered further, below.) The plaintiffs must argue they are owed a duty on the basis of the High Court of Australia decision, Perre, and must be able to distinguish the court’s decision in Woolcock and Brookfield Multiplex Ltd v Owners Corp Strata Plan 61288. Several factors are taken into account to determine whether a duty is owed, as no single test exists. Gummow J refers to the ‘salient features’ of the relationship, an approach which has commanded a great deal of judicial support. Even though the High Court delivered seven judgments in Perre, certain features were highlighted, several of which also featured in Woolcock. When applied here, the most important salient features point away from finding a duty. One factor, in particular — fear of indeterminate liability — is a pressing concern. The judges in Perre emphasised the importance of the fact that the class of affected plaintiffs in Perre was of a determinate size and readily ascertainable make-up (like Caltex). That is not the case here. It is significant that all the claimants operated businesses (or worked at a business, in Pene’s case) or was a council responsible for an affected area in a different state from the defendant (and 200 kilometres away). Even if Dakota Horse Breeders and Jockey Trainers Pty Ltd were adjacent to Aspirationville, this in itself would not be a rational basis for defining the class. This case is unlike Perre, where, factually, the Western Australian statute served to determine who comprised the class of plaintiffs: they were readily ascertainable, existing within the Act’s specified geographical quarantine boundaries. In McMullin v ICI Australia Operations Pty Ltd, Wilcox J rejected the argument that the plaintiffs’ case was like Perre. Like the present case and unlike Perre, the plaintiffs in McMullin did not form a determinate, geographically confined class. The plaintiffs contend that the duty should cover Cupid’s Kitchen, an eatery located 30 kilometres away from Serenity Shire as well as the Punter’s Pub, 50 kilometres away. Indeed, the defendant is not even in the same state, over 200 kilometres from Serenity Shire, where the bulk of the purely economic loss occurred. How wide would the duty be if one were found to exist? What geographical limit could be imposed on it? 200 kilometres? 300 kilometres? 500 kilometres? Because no

[page 455] principled limit can be placed on the duty if one were to be found, finding a duty here would lead to arbitrary results. There is nothing on these facts to indicate the breadth of Dakota’s supposed duty. There is nothing to indicate, in any principled fashion, how widespread it should be. Indeed, if a duty were held to exist here, there would be no valid reason for denying its existence in cases brought by disgruntled gamblers who were pinning their fortunes on Whiskey Sour’s predicted success at the Cup. The duty would be limitless. It would be absurd. Another factor that featured heavily in the Perre judgments was the plaintiffs’ vulnerability, in the sense of their inability to do anything to protect themselves from the harm that befell them. This was the most important factor missing in Woolcock, such that a duty was not found. More recently, its significance was highlighted in Brookfield Multiplex Ltd, where the absence of vulnerability in the Woolcock sense played a key role in all four judgments. As the High Court stated, its absence ‘demonstrated the ability of the parties to protect themselves against any lack of care by the builder in performance of its contractual obligations. It was not suggested that the parties could not protect their own interests’. This feature is lacking in all the present plaintiffs’ claims. Like the claimants in Woolcock and Brookfield Multiplex Ltd, the instant plaintiffs were not vulnerable because they were able to protect themselves from harm. Dakota may concede that vulnerability is not necessarily a conclusive factor to finding a duty. As the High Court seems to suggest in Barclay v Penberthy, it is one of several factors to be evaluated. Apache Energy Ltd v Alcoa of Australia Ltd (No 2) further notes that ‘there is no binding authority that vulnerability is a necessary condition of a duty’. That said, Dakota would assert that it is clearly an extremely important factor in the duty analysis and its absence here is telling, as was the case in all four judgments in Brookfield Multiplex Ltd, where finding a duty was denied. While on its own it may not be determinative of the result, the absence of vulnerability is a very significant factor which should lead to a rejection of the plaintiffs’ claims. The additional statement in Apache that ‘there is no fixed or certain scope of the concept of vulnerability’ and ‘the nature and degree of vulnerability sufficient to support a duty will vary from case to case, category to category’ should not be seen to diminish the importance of this factor, on the instant facts. Whatever its scope, vulnerability is not present here. The plaintiffs claim that previously, their livelihoods were dependent on the carnival operating as a successful revenuegenerating venture (at least during this period of the year, especially for some plaintiffs, like Pene and, to a degree, the council). However, Dakota would contend that they could have taken care to ensure that they were viable enterprises on their own accord. They should have made their businesses independent and less intimately connected to the carnival. Dakota, with its supply of some horses and training of some jockeys, should not be seen to be the guarantor (in a sense) of their commercial viability and financial success by imposing a duty of care on it. The businesses and individuals forming this wide array of disgruntled claimants are responsible for their own lost trade (the Primavera Group, Serenity Shire Council (to a degree, as argued here), Cupid’s Kitchen, the Punter’s Pub, Chantal’s Chateau de Chapeaux) and lost income (in Pene’s case,

because of the Punter’s Pub’s lost patronage). If Chantal’s vintage hats are as ‘splendid’ as her advertisement professes, she would still be in business. [page 456] Those who engage in commerce have the capacity to protect themselves against loss. This was a significant reason for the High Court refusing to find a duty in Esanda Finance Corp Ltd v Peat Marwick Hungerfords. The Primavera Group in particular should have carefully inspected Saki with its own independent experts before purchasing her from the Pharlap Consortium. This is especially so in the light of murmurs from Japan about the flu. It simply made a bad bargain, purchasing a horse that was not worth what they paid for it. These types of purchasers can ordinarily be expected to employ their own advisers to accurately determine the condition of the item they are purchasing, whether it is a thoroughbred horse or premises. Like the claimants in Woolcock and Brookfield Multiplex Ltd, the Primavera Group should have assessed all risks before purchasing Saki. One would expect no less of the purchaser of an expensive animal (and investment) whose pedigree should be checked with great care, in what would otherwise be an inherently risky venture. It has to wear the responsibility and ensuing financial loss for this demonstrated lack of business acumen. So too must all the others affected by the ruined carnival season. Unlike Gwam Investments Ltd v Outback Health Screenings Pty Ltd, vulnerability cannot be found here because there is an absence of reliance by the plaintiffs on Dakota and no assumption of responsibility by Dakota to any of those plaintiffs. Actual knowledge of the potential harm to these plaintiffs (one of several factors examined as ‘salient features’, including indeterminacy and vulnerability) cannot be presumed here. Although, for argument’s sake, it might be said that Dakota knew or ought to have known that each of these enterprises (and Pene) was in the class of potential plaintiffs that might be affected, there was no certainty about which businesses would suffer loss. An argument built upon knowledge is especially difficult to sustain with respect to Cupid’s Kitchen and the Punter’s Pub, which operate, respectively, as an eatery and drinking establishment all year round. Unlike Caltex, where the defendant knew or ought to have known precisely what kind of loss the single identifiable plaintiff would suffer as a result of its negligence, Dakota did not have any specific knowledge or means of knowledge that Cupid’s Kitchen and the Punter’s Pub — let alone Pene and her university studies and Chantal’s Chateau de Chapeaux — would suffer any loss at all if one of its horses were ill and sold to someone who might participate in the Cup. Even if Dakota knew that some kind of loss might be suffered if it negligently cared for a horse (and sold it), this is not sufficient to give rise to a duty of care, as this would amount to mere foreseeability. In accordance with Gaudron J’s approach, none of the plaintiffs has legal rights that were impaired by Dakota’s conduct, unlike the case in Perre. McHugh J adopted an incremental approach in Perre, emphasising the absence of indeterminate liability, the plaintiffs’ vulnerability and inability to protect themselves and the defendant’s knowledge of the risk of harm to the plaintiffs. Aside from emphasising the importance of indeterminacy, Hayne J considered whether imposing liability would be consistent

with basic assumptions about the economy in which the defendant’s conduct took place. Based on this reasoning, to impose a duty here would unduly interfere with Dakota’s right to carry on its commercial enterprise, as part of a competitive, freemarket economy. If a duty were held to exist, the burden on Dakota’s trading activities would be inordinately large and would unjustly affect its ability to carry on business (also of particular concern to McHugh J in Perre). [page 457] The Primavera Group may try to contend that it does come within the ‘transferred loss’ principle (as the court held in Seas Sapfor). It would argue that there is no obvious reason for denying recovery as there is no risk of indeterminate liability. This is the way in which this notion was employed in Bryan v Maloney. However, this characterisation should not apply here. The Primavera Group’s circumstances are similar to those in Woolcock, where the High Court distinguished Bryan and held that the plaintiff was not vulnerable in the sense of being unable to protect itself from harm. Brookfield Multiplex Ltd is similar in this regard. (Arguably, had the Pharlap Consortium sued Dakota for any economic loss it incurred (which is not what occurred on the facts), Dakota could contend that it also did not owe Pharlap a duty as it was not ‘vulnerable’; in simple terms, it too could be said to have made a poor bargain. There was no legitimate loss to ‘transfer’.) As was noted above, the plaintiffs in Woolcock and Brookfield Multiplex Ltd failed in large part (but not solely) because of the absence of vulnerability. Once again, even though it is recognised that this is not the only factor to be examined in this ‘multifactorial’ analysis (Western Districts Development Pty Ltd v Baulkham Hills Shire Council), its overwhelming importance should not be denied, as noted in cases such as Precision Products (NSW) Pty Ltd v Hawkesbury City Council, Rail Corp of New South Wales v Fluor Australia Pty Ltd, Papadopoulos v MC Labour Hire Services Pty Ltd (No 4), Western Districts Development Pty Ltd v Baulkham Hills Shire Council and Gwam Investments Pty Ltd v Outback Health Screenings Pty Ltd. In Woolcock, vulnerability was of great significance, compared to the ‘transferred loss’ nature of the claim. In fact, based on Woolcock, the court in Project No 2 Pty Ltd v Cushway Blackford & Associates Pty Ltd questioned the authoritative value of the leading transferred loss case, Bryan, which it said had been ‘discredited’. That said, relatively recently, the High Court in Brookfield Multiplex Ltd did not suggest that Bryan was wrongly decided; rather, it confined Bryan to its facts — cases involving dwelling houses. None of the plaintiffs can convincingly characterise their losses as ‘transferred losses’, to use the language of Doyle CJ in Seas Sapfor Forests Pty Ltd v Electricity Trust of South Australia. All of them, except perhaps the Primavera Group, would certainly fail if they made that argument. Their status is more akin to that of the unsuccessful claimants in McMullin v ICI Australia Operations Pty Ltd (even if they were identifiable). Serenity Shire Council, Cupid’s Kitchen, The Punter’s Pub, Pene or Chantal’s Chateau de Chapeaux cannot establish the required ‘connecting link’ (or ‘cattle (or meat) trail’). (Or ‘horse trail’?)

Problem 4 — Negligent Acts 8.60 ‘Pirate’s Plunder’, a chairlift overlooking isolated and spectacularly scenic Treasure Trove Cove, was owned and operated by Treasure Trove Lifts Pty Ltd until December 2016, when the chairlift was sold to Captain Hook’s Pty Ltd. The lift and its parts were manufactured and maintained by DareDevil Lifts Pty Ltd, which last serviced the Plunder in August 2015, at which time it stated that the lift was in ‘good [page 458] condition’. The only pockets of activity in this remote area were the chairlift and nearby businesses established to capitalise on its popularity — ‘Tinkerbell’s Trash ‘n’ Treasure’ and ‘Peter Pan’s Pies’. The only other business within 100 kilometres of the Plunder was ‘Ye Olde Pauline’s Ye Olde Fishe & Chippe Shoppe’. Pauline’s was 15 kilometres away (‘Home to Treasure Trove Cove’s Tastiest Tucker’, according to its signage). The Plunder had an unblemished 40-year safety record until 1 January 2017, when one of the pylons supporting the chairlift collapsed. The lift dropped suddenly, trapping and injuring 20 people. An investigation later revealed that the bolts had been severely corroded for several years, since they were last checked. This caused the pylon to collapse. Among those trapped on the lift, suspended high above the cove, were Ariana and her 10-year-old son, Bjorn, a frail fellow who was prone to sobbing at the drop of a hat. This time, with good reason, Bjorn again was sobbing, throughout the terrifying fivehour ordeal, until he was rescued. Rushed to the hospital, he underwent spinal fusion surgery. Although DareDevil fixed the Plunder in April 2017, the Plunder never regained its popularity. In October 2017, Tinkerbell’s and Peter Pan’s closed down; one month later, Ye Olde Pauline’s went out of business. One month later, Captain Hook’s shut down the Plunder, permanently. Captain Hook’s, Tinkerbell’s, Peter Pan’s and Ye Olde Pauline’s have sued DareDevil Lifts Pty Ltd. While DareDevil admits carelessness, it denies that it owed a duty of care to any of the plaintiffs. Advise the parties. (Only consider DareDevil’s liability in negligence. Note that some of the claimants also may contemplate instituting proceedings against DareDevil Lifts Pty Ltd under the Australian Consumer Law’s statutory product liability scheme: see 1.22–1.23.) The story continues, in Chapter 9, ‘Mental Harm’ (see 9.25).

Further discussion 1. In the early 1990s, the state of Victoria sued the accounting firm

KPMG Peat Marwick, alleging that when it audited the accounts of the Tricontinental merchant bank, it negligently failed to make an accurate report of the bank’s financial position, which was so bad that it subsequently crashed, causing losses of over $1 billion to the state. On 25 January 1994, KPMG Peat Marwick paid the state of Victoria $136 million in settlement of the claim, without admitting liability: see The Age, 26 January 1994. If the same incident occurred today and Victoria instituted a claim, how would ABN AMRO Bank NV v Bathurst Regional Council affect the arguments and the court’s reasoning and result? 2. Should a negligent auditor (and/or its insurers) be obliged to make compensation for losses of the magnitude outlined in question 1, which it did not cause, but merely failed to identify? Do the statutory provisions introducing systems of proportionate liability affect your response (see 14.41–14.44)? [page 459] 3. Why do professionals not always disclaim responsibility for the advice they give? 4. Do you think that the courts should be particularly wary of finding duties of care for negligent misstatements, given the exponential rise and use of social networking sites? 5. Having considered Perre v Apand Pty Ltd and Woolcock Street Investments Pty Ltd v CDG Pty Ltd, do you think a return to the ‘exclusionary rule’ in purely economic loss cases is desirable, in the interests of certainty and clarity? 6. Do you agree with McMurdo P in Fortuna Seafoods Pty Ltd v The Ship ‘Eternal Wind’ [2005] QCA 405 that the availability of insurance to protect the plaintiff from loss should generally not be regarded as relevant to the issue of vulnerability? 7. Do you agree with the High Court of Australia’s reasoning in

Barclay v Penberthy? 8. In purely economic loss cases, should the presence or absence of vulnerability be a conclusive factor to finding or denying, respectively, the existence of a duty of care?

Further reading Balkin R P and Davis J L R, ‘Duty of Care’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 7. —, ‘The Negligent Infliction of Purely Economic Loss’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 13. Barker K, Cane P, Lunney M and Trindade F, ‘Negligence and the Scope of the Obligation to Take Care: Duty of Care’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 9. Beach J, ‘Indeterminacy: The Uncertainty Principle of Negligence’ (2005) 13 Torts Law Journal 129. Cane P, ‘The Blight of Economic Loss: Is There Life after Perre v Apand?’ (2000) 8 Torts Law Journal 246. Chan L, ‘The Penumbral Duty of Care — Is a Principled Approach Possible?’ (2013) 21 Torts Law Journal 106. Davies M, ‘“Special Skill” in Negligent Misstatement’ (1990) 17 Melbourne University Law Review 484. Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘The Intentional and Negligent Infliction of Economic Loss’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 16. Stapleton J, ‘The Golden Thread at the Heart of Tort Law: Protection of the Vulnerable’ (2003) 24 Australian Bar Review 135. Witting C, ‘Justifying Liability to Third Parties for Negligent

Misstatements’ (2000) 20 Oxford Journal of Legal Studies 615. —, Liability for Negligent Misstatements, Oxford University Press, Oxford, 2004.

1 2 3 4

M Davies, ‘Special Skill in Negligent Misstatement’ (1990) 17 Melbourne University Law Review 484. See P Cane, ‘The Blight of Economic Loss: Is There Life After Perre v Apand?’ (2000) 8 Torts Law Journal 246. See C Sappideen and P Vines (eds), Fleming’s The Law of Torts, 10th ed, Thomson Reuters/Lawbook Co, Sydney, 2011, p 206. See note 3 above, p 206.

[page 461]

9 Mental Harm Objectives After completing this chapter, you should: — understand the reasons for the courts’ historic aversion to recovery in cases of mental harm; — understand the common law test for the existence of a duty of care not to cause mental harm; — have a working knowledge of how the common law test for the existence of a duty of care not to cause mental harm has been modified by statute in all jurisdictions except Queensland; — understand in what circumstances Australian law permits recovery for intentionally inflicted mental harm.

Key cases — Giller v Procopets (2008) 24 VR 1 — King v Philcox (2015) 255 CLR 304; 320 ALR 398 — Tame v New South Wales; Annetts v Australian Stations Pty Ltd (2002) 211 CLR 317; 191 ALR 449

—

Wicks v State Rail Authority of New South Wales (2010) 241 CLR 60; 267 ALR 23

Key legislative developments — Civil Law (Wrongs) Act 2002 (ACT) Pt 3.2 — Civil Liability Act 2002 (NSW) Pt 3 — Law Reform (Miscellaneous Provisions) Act 1956 (NT) ss 24, 25 — Civil Liability Act 1936 (SA) s 33 [page 462] — Civil Liability Act 2002 (Tas) Pt 8 — Wrongs Act 1958 (Vic) Pt XI — Civil Liability Act 2002 (WA) Pt 1B

Introduction 9.1 Psychological illness can be quite as disabling as physical injury. Yet for many years, the law regarded ‘invisible’ disabilities of this kind with mistrust. In the 19th century, the rule was that damages for ‘nervous shock’ (as it was then known) were recoverable in the tort of negligence only if that shock was consequent upon physical injury to the plaintiff: see Victorian Railways Commissioners v Coultas (1888) 13 App Cas 222. In Wilkinson v Downton [1897] 2 QB 57, the English High Court recognised an action on the case (see 16.1) for intentional but indirect infliction of emotional harm but here, too, recovery was tied to physical harm. It was necessary to show that the defendant wilfully

did an act calculated to cause physical harm, a requirement that was obviously difficult to establish. 9.2 The 20th century saw the gradual abandonment of the threshold requirement in the tort of negligence that the plaintiff must have suffered physical injury as well as emotional harm. First, it was held that damages were recoverable in the absence of physical injury to the plaintiff, but only if the plaintiff suffered shock because of fear for her or his own life or safety: Dulieu v White [1901] 2 KB 669. Then, it was held that damages were recoverable if the plaintiff feared for the life or safety of a close relative, such as a son or daughter: Hambrook v Stokes [1925] 1 KB 141. The next step was to hold that a plaintiff could recover damages for shock caused by witnessing the immediate aftermath of an accident involving a loved one: Jaensch v Coffey (1985) 155 CLR 549; 54 ALR 417. 9.3 Despite the gradual easing of the restrictive rules in negligence, it still remained true until quite late in the 20th century that a plaintiff could only recover for mental harm arising as a result of some sudden shock caused by the threat of physical harm to herself, himself or a close relative, or by witnessing the aftermath of an incident causing physical harm to a close relative. For that reason, the courts continued (and still occasionally continue) to use the odd and anachronistic expression ‘nervous shock’ in order to contrast ‘shock’, meaning some recognised psychiatric illness caused by trauma, with ‘mere grief and sorrow’, which do not give rise to an action for damages. In Jaensch v Coffey (at CLR 567; ALR 430), Brennan J said: I understand ‘shock’ in this context to mean the sudden sensory perception — that is by seeing, hearing or touching — of a person, thing or event, which is so distressing that the perception of the phenomenon affronts or insults the plaintiff’s mind and causes a recognisable psychiatric illness.

9.4 Ironically, while liability for negligently caused mental harm gradually became accepted, the law relating to intentionally caused mental harm underwent little change. Six of the eight Australian jurisdictions have legislated in relation to negligently caused

[page 463] mental harm, and the common law now places recovery for negligently caused mental harm on the same footing as recovery for physical injury, yet it was still possible for the state of New South Wales to argue in 2013 that there is no tort of intentional infliction of mental harm: see Clavel v Savage [2013] NSWSC 775: see 9.17.

Negligently Caused Mental Harm 9.5 The slow progression of the tort of negligence outlined in 9.2 was famously described by Windeyer J in Mount Isa Mines Ltd v Pusey (1970) 125 CLR 383 at 395 as ‘[l]aw, marching with medicine but in the rear and limping a little’. In the next two cases, the common law caught up a little, as the High Court of Australia finally abandoned most of the preconditions to the existence of a duty of care in relation to mental harm, placing recovery for psychiatric injury under the common law of negligence on the same footing as recovery for physical injury. (When reading the description of the next two cases, it should be noted that the common law position described in them now applies only in Queensland.) Key Case Tame v New South Wales; Annetts v Australian Stations Pty Ltd (2002) 211 CLR 317; 191 ALR 449 Facts (Tame): In Tame, a police officer gave a blood alcohol test to the plaintiff after she was involved in a motor vehicle collision. The test showed she had no alcohol in her blood at all, but the police officer mistakenly recorded a reading of 0.14. Although the error was corrected within a month, the plaintiff became obsessed by the mistake and developed a psychotic depressive illness, worrying that people would think that she had been drinking heavily before the accident. She sued the state of New South Wales, the police officer’s employer, alleging that she had suffered emotional harm as a result of his negligence in recording the test results. Facts (Annetts): The plaintiffs suffered ‘an entrenched psychiatric condition’ after their son died while working as a jackaroo on the defendant’s cattle station. They had been assured by the defendant that their son would work under constant supervision and would be well looked after, but he was assigned to work alone at a remote station. He

died of dehydration, exhaustion and hypothermia after his car became bogged in the desert. The parents sued the cattle station owner, alleging that their psychiatric condition was caused by its negligence. The plaintiff in Tame won at trial, but the Court of Appeal of New South Wales reversed the decision, holding that the defendant owed the plaintiff no duty, because the law only imposes a duty to avoid psychiatric injury to a person of ‘normal fortitude’. The trial judge in Annetts held that the defendant did not owe the plaintiffs a duty of care because their psychiatric condition was not the result of a ‘sudden sensory perception’ of their son’s death or its aftermath. A Full Court of the Supreme Court of Western Australia dismissed an appeal by the plaintiffs. Both plaintiffs appealed to the High Court of Australia, which heard the appeals together. [page 464] Issues: Did the defendant in either Tame or Annetts owe a duty not to cause mental harm? If so, on what basis? Decision: By a majority of six to one (Callinan J dissenting), the High Court of Australia held that liability for damages for psychiatric harm was not limited to cases where that harm is caused by a sudden shock arising as a result of direct perception of a distressing event or its immediate aftermath. Three members of the court (Gleeson CJ, Gummow and Kirby JJ) held that it is not a precondition for recovery that the plaintiff be a person of ‘normal’ mental health and psychological fortitude; two (McHugh and Callinan JJ) disagreed with that proposition; two (Gaudron and Hayne JJ) said that ‘normal fortitude’ is a convenient means of determining whether a risk of psychiatric injury is foreseeable, but a duty might arise if the defendant knows the plaintiff is particularly susceptible to injury of that kind.

Case Example Gifford v Strang Patrick Stevedoring Pty Ltd (2003) 214 CLR 269; 198 ALR 100 Facts: One of the defendant’s employees was crushed to death by a forklift vehicle driven negligently by another employee. The plaintiffs, who were the deceased’s three teenage children, did not witness the accident but were told about it later on the same day. They claimed to have suffered psychiatric injury as a result of what they had been told. Issue: Did the defendant owe a duty to the plaintiffs, who had not witnessed the death of their father? Decision: Applying the principles stated in Tame and Annetts, the High Court of

Australia held unanimously that the employer owed the children a common law duty of care, even though they had not witnessed their father’s fatal accident.

9.6 The common law position in Tame and Gifford (see 9.5) has been modified by statute in all jurisdictions except Queensland. The Northern Territory has legislation about ‘mental or nervous shock’ that precedes Tame and Gifford.1 Each jurisdiction other than Queensland and the Northern Territory now distinguishes between ‘consequential mental harm’, which is mental harm that is consequential on personal injury of some other kind, and ‘pure mental harm’, which is mental harm that is not consequential on other personal injury.2 (In the rest of this chapter, those six jurisdictions — the Australian Capital Territory, New South Wales, South Australia, Tasmania, Victoria and Western Australia — are referred to as ‘the legislating jurisdictions’.) For both types of mental harm, the defendant only owes [page 465] a duty of care to the plaintiff if she or he (the defendant) ‘foresaw or ought to have foreseen that a person of normal fortitude might, in the circumstances of the case, suffer a recognised psychiatric illness if reasonable care were not taken’.3 In five of the six legislating jurisdictions, damages for either kind of mental harm are not recoverable if the plaintiff does not suffer a recognised psychiatric illness.4 Western Australia only imposes that requirement in the case of consequential mental harm.5 Thus, the legislating jurisdictions maintain by statute the common law prohibition against recovery for ‘mere grief and sorrow’. 9.7 In cases of pure mental harm, the courts in each of the six legislating jurisdictions must have regard to the following factors in determining whether a person of normal fortitude would suffer a recognised psychiatric illness in the circumstances:6 •

whether or not the mental harm was suffered as the result of a

sudden shock; and •

whether the plaintiff witnessed, at the scene, a person being killed, injured or put in danger; and

•

the nature of the relationship between the plaintiff and anyone killed, injured or put in danger; and

•

whether or not there was a pre-existing relationship between the plaintiff and the defendant.

These factors are irrelevant if the defendant knew, or ought reasonably to have known, that the plaintiff was a person of less than normal fortitude.7 In such a case, the defendant would owe the plaintiff a duty because of the defendant’s knowledge of the plaintiff’s special vulnerability. In Wicks v State Rail Authority of New South Wales (2010) 241 CLR 60; 267 ALR 23, the High Court of Australia stated that these statutory provisions should be understood in the context of the common law of negligence in relation to psychiatric injury as stated in Tame (see 9.5), which meant that foreseeability remained the central determinant of a duty of care. The statutory factors listed above are no more than that, factors to be taken into account by the court — they are not requirements for the existence of a duty of care. The court unanimously stated (at [25]–[29]): [page 466] Tame held that in deciding whether, for the purposes of the tort of negligence, a defendant owed a plaintiff a duty to take reasonable care to avoid recognisable psychiatric injury, the central question is whether, in all the circumstances, the risk of the plaintiff sustaining such an injury was reasonably foreseeable. A majority of the court in Tame rejected the propositions that concepts of ‘reasonable or ordinary fortitude’, ‘shocking event’ or ‘directness of connection’ were additional preconditions to liability. In part, s 32 of the [New South Wales] Civil Liability Act reflects the state of the common law identified in Tame. Consistent with what was decided in Tame, s 32 assumes that foreseeability is the central determinant of duty of care. Consistent with Tame, ‘shocking event’, and the existence and nature of any connection between

plaintiff and victim and between plaintiff and defendant, are considerations relevant to foreseeability, but none is to be treated as a condition necessary to finding a duty of care. But contrary to what was decided in Tame, s 32 provides that a duty of care is not to be found unless the defendant ought to have foreseen that a person of normal fortitude might, in the circumstances of the case, suffer a recognised psychiatric illness. For present purposes, there are three important features of s 32. First, ‘sudden shock’ (the expression used in s 32(2)(a)) is no more than one of several circumstances that bear upon whether a defendant ‘ought to have foreseen that a person of normal fortitude might, in the circumstances of the case, suffer a recognised psychiatric illness if reasonable care were not taken’. The occurrence of ‘sudden shock’ is neither a necessary nor a sufficient condition for a finding that a defendant owed a duty to take reasonable care not to cause a plaintiff pure mental harm. Secondly, witnessing, at the scene, a person being killed, injured or put in peril is also but one of the circumstances that bear upon the central question of foreseeability. Witnessing, of the kind described, is neither a necessary nor a sufficient condition for finding a duty of care. Thirdly, the focus of s 32 is ‘mental harm’ and ‘a recognised psychiatric illness’, not mental or nervous shock. Section 32 does not use the expression ‘mental or nervous shock’.

9.8 Thus, as pointed out by the court in Wicks, the statutory factors listed in 9.7 do not exclude the possible existence of a duty of care in cases where (as in Annetts (see 9.5)) there was no sudden shock to the plaintiff’s senses, nor do they exclude the possible existence of a duty of care in cases where (as in Annetts and Jaensch v Coffey (see 9.2)) the plaintiff suffered mental harm without actually witnessing anyone being killed, injured or put in danger. They merely provide that the court must take into account the fact that the plaintiff did not directly perceive the threat or its immediate aftermath and/or did not suffer any sudden shock. 9.9 However, a restrictive prerequisite on the recovery of damages is imposed by the legislation in New South Wales, South Australia, Tasmania and Victoria in cases where the plaintiff suffers mental harm without actually witnessing anyone being killed, injured or put in danger. If the plaintiff suffers pure mental harm arising wholly or partly from mental or nervous shock in connection with another [page 467]

person (the victim) being killed, injured or put in peril by the act or omission of the defendant, the plaintiff cannot recover damages for pure mental harm unless:8 •

she or he witnessed, at the scene, the victim being killed, injured or put in peril (in South Australia, ‘present at the scene of the accident when the accident occurred’; in Tasmania only, also including witnessing the immediate aftermath of the victim being killed or injured); or

•

the plaintiff is a close family member of the victim. (The Victorian provision says ‘in a close relationship with the victim’; the South Australian one says ‘parent, spouse, domestic partner or child’.) ‘Close family member’ is defined in New South Wales and Tasmania to mean the parent (or other person with parental responsibility), the spouse, partner, child (or stepchild), brother, sister, half-brother, half-sister, stepbrother or stepsister of the victim.9

In Wicks v State Rail Authority of New South Wales (at [22]), the High Court of Australia said that because these provisions create a limitation upon entitlement to damages, they should not be considered until after the court has determined whether a duty of care was owed, taking into account the statutory factors listed in 9.7. 9.10 In Wicks, the plaintiffs were two police officers who acted as rescuers at the scene of a train crash caused by the admitted negligence of the defendant. They suffered what the statute calls ‘pure mental harm’ as a result, because they were affected by what they saw, rather than by any physical injury to themselves. The defendant argued that the plaintiffs’ ‘pure mental harm’ did not arise from shock in connection with witnessing another person being killed, injured or put in peril by the defendant’s negligence, because the crash and the deaths and injuries of the train passengers were over before the plaintiffs arrived on the scene. The High Court of Australia unanimously rejected that argument. The court held that the shock suffered by the plaintiffs was not confined to the moment when they arrived on the scene, but continued as they took in more of the scene

and set about their tasks (at [37]). Of the requirement that the plaintiffs must have witnessed people being killed, injured or in peril, the unanimous court said (at [45]–[49]): The consequences of the derailment took time to play out. Some aboard the train were killed instantly. But even if all of the deaths were instantaneous (or nearly so), not all the injuries sustained by those on the train were suffered during the process of derailment. And the perils to which living passengers were subjected as a result of the negligence of State Rail did not end when the carriages came to rest. Most, if not all, who were injured suffered physical trauma during the process of derailment. It may readily be inferred that some who suffered physical trauma in the derailment suffered further injury as they were removed from the wrecked carriages. That inference follows from the fact that some were trapped in the wreckage. It would be very surprising if each was extricated without further harm.

[page 468] Further, it may be readily inferred that many who were on the train suffered psychiatric injuries as a result of what happened to them in the derailment and at the scene. The process of their suffering such an injury was not over when [the plaintiffs] arrived. That is why each told of the shocked reactions of passengers they tried to help. That is why each did what he could to take the injured to safety looking straight ahead lest the injured see the broken body of one or more of those who had been killed. As they were removed from the train, at least some of the passengers were still being injured. If either inference is drawn, [the plaintiffs] witnessed, at the scene, victims of the accident ‘being injured’. Even if neither of these inferences should be drawn, the fact remains that when [the plaintiffs] arrived at the scene of the accident, those who had been on the train, and had survived, remained in peril. The agreed description of each of [the plaintiffs] as ‘a rescuer’ necessarily implies as much. Each sought to (and did) rescue at least some of those who had been on the train from peril. The observation of fallen electrical cables draped over the carriages is but a dramatic illustration of one kind of peril to which those who remained alive in the carriages were subject before they were taken to a place of safety.

In the next case, a majority of the High Court of Australia considered the damage-limiting provision in the South Australian legislation before the duty of care provision (notwithstanding what had been said in Wicks about the proper order of considering the statutory provisions), in another ‘aftermath’ case that produced a different result

from that in Wicks. Although the South Australian legislation is phrased differently from that in New South Wales, Tasmania and Victoria, it is unlikely that the case would have been decided differently under the law of those jurisdictions. Key Case King v Philcox (2015) 255 CLR 304; 320 ALR 398 Facts: A car negligently driven by the defendant collided with another car at an intersection. A passenger in the defendant’s car died while trapped in the car. The plaintiff, who was the dead passenger’s brother, drove through the intersection several times while the damaged cars were still there. When he discovered later that his brother had died in the crash, he was devastated by the thought that he had not stopped to help because he did not know that his brother was trapped in one of the crashed cars. He suffered a major depressive disorder with significant anxiety-related components of a post-traumatic stress reaction. (It was accepted for purposes of this litigation that this constituted a ‘recognised psychiatric illness’.) He sued the defendant for causing him mental harm. Issues: Did the defendant owe a duty of care to the plaintiff? Could the plaintiff recover damages from the defendant? Decision: The High Court of Australia held that although the defendant driver did owe the plaintiff a duty of care not to cause him mental harm, the plaintiff’s claim [page 469] was defeated because he had not been present at the scene of the accident when the accident occurred, as required by the South Australian legislation (Civil Liability Act 1936 (SA) s 53(1)). French CJ, Kiefel and Gageler JJ said (at [21]): The text of s 53(1)(a) … does not support the extended notion of ‘[presence] at the scene of the accident when the accident occurred’ for which [the plaintiff] contends. According to ordinary English usage he drove past ‘the scene of the accident’ several times. Assuming he can be taken, on that basis, to have been ‘present at the scene of the accident’, he was not ‘present at the scene of the accident when the accident occurred’. Although the disentitling effect of s 53 meant that it was not necessary to decide whether the defendant would have owed a duty of care to the plaintiff, the deceased’s brother, the court went on to hold that there would have been a duty. French CJ, Kiefel and Gageler JJ said (at [29]): To say that a duty of care is owed to a parent, spouse, child, fellow employee or

rescuer of a victim is not to say that it cannot be owed to the sibling of a victim. The terms of s 33 are consistent with that approach for they include, as one of the circumstances relevant to the foreseeability that is a necessary condition of the duty of care, ‘the nature of the relationship between the plaintiff and any person killed, injured or put in peril’. A sibling relationship is a circumstance of that character. Whether it is a close or loving relationship or a distant one may go to the question of causation more than the existence of a duty of care, but it is not necessary to explore that issue further for the purposes of this case.

9.11 In the Australian Capital Territory and the Northern Territory, if someone is killed, injured or put in danger by the defendant’s wrongful act or omission, that person’s parent or domestic partner (in the Northern Territory, ‘parent or the husband or wife or de facto partner’) may recover damages for ‘mental or nervous shock’ suffered as a result, whether or not they witnessed the accident, but other family members may recover only if the person was killed, injured or put in danger ‘within the sight or hearing of the other family member’.10 Presumably, this legislation will produce the same result as that in King v Philcox for family members other than parents or domestic partners. 9.12 Some examples may help to illustrate the net effect of these statutory provisions. If I suffer some recognised psychiatric illness after being told over the telephone that my best friend has been horribly injured, I cannot recover damages in the Australian Capital Territory, New South Wales, the Northern Territory, South Australia or Tasmania because I did not witness the accident and am not a close family member of the victim. I may be able to recover in Victoria, if the court holds that I am in a ‘close relationship’ with my best friend and also if my illness arises as a result of ‘mental or nervous shock’ upon hearing the news. In Victoria and Western Australia, the court must take into account the fact that I did not witness my friend being injured when it determines whether the defendant ought [page 470]

to have foreseen that a person of normal fortitude would have suffered a recognised psychiatric illness in my position. If I suffer some recognised psychiatric illness as a result of witnessing a stranger being killed, horribly injured or put in peril, I may recover damages in New South Wales, South Australia, Tasmania, Victoria and Western Australia but not in the Australian Capital Territory or the Northern Territory, because I am not a member of the victim’s family. The court must take into account the fact that I had no pre-existing relationship with the victim when it determines whether the defendant ought to have foreseen that a person of normal fortitude would have suffered a recognised psychiatric illness in my position. If I suffer grief and distress but no clinical depression as a result of being wrongly (and negligently) diagnosed as having cancer, I probably cannot recover damages in any of the six legislating jurisdictions. (See, for example, Flight Centre Ltd v Louw (2010) 78 NSWLR 656, where the plaintiffs’ claim failed, despite the fact that the defendant’s negligence had caused them ‘inconvenience, distress and disappointment’, because the impairment of their mental condition did not amount to a ‘recognised psychiatric illness’.) In Western Australia, it might be possible to argue that a duty could arise if it was foreseeable that a person of normal fortitude would suffer a recognised psychiatric illness in the circumstances, even though I did not (in other words, if I am a person of abnormally great fortitude). Nevertheless, although my grief and distress might properly be described as ‘mental harm’, the common law position has always been that there cannot be liability for ‘mere grief and sorrow’: see 9.3. In Harris v Commissioner for Social Housing (2013) 8 ACTLR 98, it was held that the Australian Capital Territory’s requirement that the plaintiff must have suffered some ‘recognised psychiatric illness’ was satisfied when the plaintiff suffered an aggravation of an existing recognised psychiatric illness. 9.13 When considering whether a person of normal fortitude would suffer a recognised psychiatric illness in cases of ‘consequential mental harm’, the courts in all six legislating jurisdictions must consider ‘the

nature of the bodily injury out of which the mental harm arose’, although that requirement is subject to an important qualification in South Australia and the Australian Capital Territory, as we will shortly see.11 Thus, if the plaintiff suffers dramatic psychological consequences as a result of a relatively minor physical injury, the court may conclude that the defendant owed no duty in relation to the consequential mental harm. For example, in Bartolone v Jeckovich 481 NYS 2d 545 (NY App Div 1984), the plaintiff, a bodybuilder who was extremely proud of his physical condition, became totally and permanently disabled by paranoid schizophrenia after suffering what the court called ‘relatively minor injuries’ in a motor vehicle accident caused by the defendant’s negligence. The plaintiff’s action against the negligent defendant succeeded under New York law. [page 471] Similarly, a Full Court of the Supreme Court of South Australia held in Anwar v Mondello Farms Pty Ltd (2015) 123 SASR 321 (see 4.60) that the plaintiff, who suffered schizophrenia as a result of ‘a relatively simple and non-life-threatening injury’ at work, was entitled to recover damages for the consequential mental harm he suffered as a result of his physical injury because a person of ‘normal fortitude in the plaintiff’s position’ — that is, with the plaintiff’s background, education, experience and physical characteristics — would foreseeably have suffered some kind of psychiatric illness (not necessarily schizophrenia) as a result of the injury. The defendant did not know that the particular plaintiff was not a person of ‘normal fortitude’ with a ‘fragile psyche’ but that was irrelevant; the relevant question was whether a person of the plaintiff’s background (an Afghan refugee to Australia, relatively isolated from the larger Australian community, with a background of considerable suffering) might foreseeably suffer a recognised psychiatric illness of some kind as a result of the physical injury. When considering the result in Anwar’s case, it is important to note that the words ‘in the plaintiff’s

position’ appear only in the South Australian legislation and that of the Australian Capital Territory; the other legislating states refer only to a person of ‘normal fortitude’, which may mean that Anwar would be decided differently in legislating jurisdictions other than South Australia and the Australian Capital Territory. 9.14 In the Australian Capital Territory, New South Wales, South Australia, Tasmania, Victoria and Western Australia, the court cannot award damages for economic loss (see Chapter 12) for consequential mental harm unless the harm consists of a recognised psychiatric illness.12

Intentional Infliction of Mental Harm 9.15 The tort of ‘intentional infliction of emotional distress’ is well established in the United States. A remedy for intentionally caused emotional distress not arising out of physical injury — that is, emotional distress alone — was first recognised by the Supreme Court of California in State Rubbish Collectors Association v Siliznoff, 240 P 2d 282 (Cal 1952). Most, but not all, states acknowledge the tort, which is described as follows by the Restatement (Second) of Torts, §46: (1) One who by extreme and outrageous conduct intentionally or recklessly causes severe emotional distress to another is subject to liability for such emotional distress, and if bodily harm to the other results from it, for such bodily harm. (2) Where such conduct is directed at a third person, the actor is subject to liability if he intentionally or recklessly causes severe emotional distress: (a) to a member of such person’s immediate family who is present at the time, whether or not such distress results in bodily harm, or

[page 472] (b) to any other person who is present at the time, if such distress results in bodily harm.

Examples include an employer ignoring an employee’s repeated complaints and requests for help in relation to sexual harassment in

the workplace (Pollard v EI DuPont De Nemours Inc, 412 F 3d 657 (6th Cir 2005)), refusal by a school superintendent, principal, and teachers to intervene when the only African-American student in a kindergarten was the target of racial slurs and racially motivated physical abuse (DiStiso v Town of Wolcott, 539 F Supp 2d 562 (D Conn 2008), vacated and remanded on other grounds 352 Fed Appx 478 (2d Cir 2009)), deliberately implicating the plaintiff in a sexual molestation case in order to draw attention away from the person accused of molestation, despite the fact that the plaintiff had nothing to do with the incident (Womack v Eldridge, 210 SE 2d 145 (1974)) and a psychologist initiating and continuing a 12-year sexual relationship with a patient suffering from a borderline personality disorder (Corbett v Morgenstern, 934 F Supp 680 (ED Pa, 1996). Nevertheless, most claims fail, often at the summary judgment stage. This is because the defendant’s conduct, although deplorable, is held not to have reached the ‘extreme and outrageous’ standard. Moreover, the remedy is qualified by the First Amendment to the United States Constitution which protects freedom of speech. In Hustler Magazine v Falwell, 485 US 46 (1988), the United States Supreme Court held that any public figure suing for intentional infliction of emotional distress by reason of a publication must prove that the defendant made the statement with ‘actual malice’ — that is, knowing that it was false, or recklessly, without caring whether it was true or false. (A depiction of this decision forms the climax of the movie The People vs Larry Flynt.) Also, in Snyder v Phelps, 562 US 443 (2011), the Supreme Court held that the First Amendment protected the free speech right of demonstrators to make protests at the funerals of deceased military service members, despite their avowed intention to cause emotional distress to the family members of the deceased and anyone else who might pay attention to them. Nevertheless, as these examples show, and as its name indicates, the tort provides a remedy for emotional distress. That remedy is not confined to cases where the plaintiff has suffered ‘recognised psychiatric illness’.

9.16 In contrast, the law in England and Australia has been much more conservative. It has never recognised a cause of action for emotional distress falling short of psychiatric injury. In Wilkinson v Downton [1897] 2 QB 57, the English High Court recognised an action on the case (see 16.1) for intentional but indirect infliction of mental harm. As a practical joke, the defendant in Wilkinson told the plaintiff that her husband had been seriously injured in an accident and that she should go and fetch him. On hearing the statement, the plaintiff suffered a violent shock to her nervous system. The plaintiff recovered damages from the defendant. Wilkinson was approved by the English Court of Appeal in Janvier v Sweeney [1919] 2 KB 316, and by the High Court of Australia in Bunyan v Jordan (1937) 57 CLR 1. As originally conceived, the cause of action was only available if the plaintiff could show that the defendant wilfully did an act calculated to cause physical harm, a requirement that was obviously difficult to establish. [page 473] 9.17 The Wilkinson v Downton action has developed to some extent, so that it is now available if the defendant intended to cause psychiatric, as opposed to purely physical injury: see, for example, JMD v GJH [2012] WADC 124 and RS v HS [2016] WADC 157, both of which were concerned with intentional infliction of psychiatric harm by sexual harassment and bullying. However, a tortious remedy is still not available when the plaintiff merely suffers emotional distress as opposed to lasting psychiatric harm, as the next two cases show. Key Case Giller v Procopets (2008) 24 VR 1 Facts: The plaintiff sought damages for intentional infliction of emotional distress after the defendant, her former husband, threatened to distribute copies of a videotape of the two of them having sex. Issue: Could the plaintiff recover damages for intentionally caused emotional distress

and humiliation falling short of psychiatric injury? Decision: A majority of the Victorian Court of Appeal held (Maxwell P dissenting) that it is still the case under Australian law that there can be no recovery for intentionally caused emotional distress, humiliation or other emotional discomfort falling short of physical or psychiatric injury. Neave JA said (at [473]–[475]): It must be conceded that the law of torts operates inconsistently by providing compensation for intentional infliction of purely mental distress in torts such as defamation and false imprisonment, but not in the case of the tort of intentionally causing harm. However, the expansion of the Wilkinson principle to cover mental distress would also create inconsistencies. Over the past decade, legislatures across Australia have imposed limits on the availability and amount of damages recoverable in negligence for physical injury. It would seem anomalous to expand the possibility of recovering damages for hurt feelings, even when intentionally caused, at a time when recovery of damages for non-economic loss arising out of physical injury has become increasingly limited. An expanded tort could potentially apply to a very broad range of situations, including harassment based on race, gender and sexual orientation, bullying, practical jokes, unkindness in family and social relationships and the insensitive management of medical patients, employees, and consumers. … A person who has suffered mental distress as the result of a defendant’s intentional acts may recover compensation under some other legally recognisable claim, as can [the plaintiff]. In other situations, domestic violence and anti-stalking laws may provide more effective remedies to victims than the payment of compensation after the event. Some acts done, or words spoken, with the intention of causing mental distress are regulated by anti-discrimination laws and statutory complaints schemes, which may or may not provide compensation. Where there is no statutory compensation for victims of such behaviour, I am not convinced that the common law should fill the gap. (Giller v Procopets was followed by Perram J in Habib v Commonwealth (No 2) (2009) 175 FCR 350; 254 ALR 250, on a pleading point about whether a claim for the tort of ‘harassment resulting in mental distress’ should be struck out. Perram J struck out the claim but with leave to replead if the new pleading alleged psychiatric injury as opposed to mere mental distress.)

[page 474] Case Example Clavel v Savage [2013] NSWSC 775

Facts: The plaintiffs and the defendants were neighbours. They complained about one another’s behaviour over a period of years in relation to a series of fairly trivial incidents. Among many other causes of action, the plaintiffs sought damages from the defendants for intentional infliction of emotional distress. The defendants represented themselves. Acting as amicus curiae (friend of the court), the state of New South Wales argued on the defendants’ behalf that the tort of intentional infliction of emotional distress did not exist. Issues: Could the plaintiffs’ case succeed on the basis of mental distress only? Was it necessary to plead and prove psychiatric injury? Decision: After an extensive review of the authorities, including Giller v Procopets, Rothman J concluded that the tort of intentional infliction of harm does exist in Australia, but that there is no remedy if the plaintiff has merely suffered distress (at [36]): [N]otwithstanding the submissions of the State to the contrary, current authority favours the existence of a tort of intentional infliction of harm, including psychiatric injury. The elements of that cause of action are: (i) (ii) (iii) (iv)

(v) (vi)

A deliberate act (hereinafter, ‘the conduct’) by the putative tortfeasor; An intention (including reckless indifference) to cause physical or psychiatric harm by the conduct; The occasioning of harm (including psychiatric injury, but not mere distress) as a result of the conduct; The harm being caused to a person to whom harm is intended (or a person in the immediate vicinity to whose harm the perpetrator is recklessly indifferent); In circumstances where the conduct was reasonably likely to cause harm in a normal person; and The putative tortfeasor has engaged in the conduct without justification or lawful excuse.

On the facts, Rothman J held that the tort might have been committed by the defendants in the circumstances, but he asked for further submissions on that point (at [911]). (Rothman J later held that the plaintiffs’ claim failed on the facts: see Clavel v Savage (No 2) [2014] NSWSC 463. The plaintiffs appealed, but their case against the defendants was settled before the appeal was heard; a related appeal by the plaintiffs against the state of New South Wales was decided at [2015] NSWCA 61.)

9.18 Similarly, the English courts have declined to extend the Wilkinson v Downton principle to cases of emotional distress falling short of physical or psychiatric injury: see Wong v Parkside Health NHS Trust [2003] 3 All ER 932. Lord Hoffmann twice observed, obiter, that damages for distress should be recoverable if there was an intention to cause such distress (Hunter v Canary Wharf Ltd [1997] AC 655 at 707; Wainwright v Home Office [2004] 2 AC 406 at [44]), but the English

Court of Appeal reaffirmed the more restrictive traditional view in Mbasogo v Logo Ltd (No 1) [2007] QB 846 (CA). [page 475] 9.19 In Balven v Thurston [2013] NSWSC 210 (see 16.18), Latham J of the Supreme Court of New South Wales said, obiter, that the Civil Liability Act 2002 (NSW) would not apply to an action in the tort of assault, because s 3B(1) provides that no provisions of the Act apply to civil liability in respect of an intentional act done with the intent to cause ‘injury’ (at [41]–[43]). The same process of reasoning should lead to the conclusion that the Act does not apply to an action for intentional infliction of mental harm, where the intention to cause psychiatric injury is an essential part of the tort (see 9.16). The position should be the same in Tasmania, which has a similar legislative provision.13 In South Australia, Victoria and Western Australia, the limits on recoverable damages imposed by the civil liability legislation do not apply to intentional torts when the tortious act is done with the intention to cause injury, which is defined to include mental harm.14 Thus, in all five jurisdictions, the limits on recoverable damages imposed by the legislation (see Chapter 12) should not apply to claims for intentional infliction of mental harm. 9.20 The legislative provisions setting out the factors to be considered in cases of negligently caused mental harm (see 9.7) do not apply to actions for intentionally caused mental harm. They describe what factors must be taken into account when determining whether the defendant owed the plaintiff a duty of care, a concept not relevant to liability for intentionally inflicted mental harm. Thus, for example, it is not necessary to consider how ‘a person of normal fortitude’ would have reacted to the defendant’s conduct. 9.21 In the Australian Capital Territory, New South Wales, South Australia, Tasmania and Victoria there cannot be liability for negligently caused ‘pure mental harm’ unless the plaintiff suffers a

recognised psychiatric illness: see 9.12. In each of these jurisdictions other than South Australia, the legislation refers to pure mental harm ‘resulting from negligence’ (in Tasmania, ‘resulting from breach of duty’).15 Thus, the denial of recovery in cases of intentionally caused emotional distress derives solely from the common law in those jurisdictions, and there is no statutory constraint on the common law expanding in the future in the manner proposed by Lord Hoffmann in England: see 9.18. That is also possible in Western Australia, where the statute makes no reference to ‘recognised psychiatric illness’ in relation to ‘pure mental harm’, and in the Northern Territory and Queensland, where there is no such legislation: see 9.6. In contrast, the South Australian provision simply states that damages may only be awarded for pure mental harm if the harm consists of a recognised psychiatric illness,16 so the restriction should apply in cases of intentionally caused pure mental harm, as well. Thus, there can be no possibility of an expansion of the law to cover cases of intentionally caused emotional distress in South Australia. [page 476]

Problem 1 9.22 Recall the problem at 8.57, involving the month-long horse racing carnival season, capped off by the Serenity Cup, but devastated by the equine flu virus. As you may remember, news of the equine flu virus rocked the racing world. The story continues: The cup itself had its lowest attendance on record, as no one wanted to see third-rate horses run. Network 42 decided not to show the race, as it predicted the race would get disastrous ratings if it were televised. Phuong, a diehard racing fan, did indeed watch the race on her laptop as it was streamed over the internet. Phuong was aghast when she saw her best friend, Pakuna, a jockey, lose her balance and fall off her horse just as she was about to cross the finish line. Phuong then observed Pakuna doubling up in pain, suffering untreatable breathing difficulties for about five minutes, before she ultimately died, on screen. Experts later determined that Pakuna’s loss of balance, acute pain and severe breathing difficulties were the result of her having contracted equine flu. Earlier that week, Phuong had warned Pakuna not to race this year, because of the

rumours of the equine flu epidemic affecting people, and the disabling effect the flu might have on Pakuna’s HIV treatment regime. Pakuna had trained for years with Dakota, and had ridden Saki several times during the period in which Dakota owned the horse. Pakuna had insisted on riding in the cup, resisting what she called the equine flu ‘hysteria’ as just that — unwarranted fear. Phuong had responded, ‘You know, I love you like a sister, and always have, but sometimes you can be just impossible; your stubbornness is gob-smacking. Go ahead — ride! It’s your funeral!’. Phuong suffered incredible guilt as a result of what happened to her lifelong friend. Phuong could not get the horrifying scene out of her mind and could not resist the allconsuming feeling that she should have tried much harder to stop Pakuna from racing. Phuong became withdrawn, unable to carry on. All she could manage to do was watch ‘YouView’ clips of the tragic race on the net, over and over again, for hours at a time. For the purposes of argument, Phuong sues Dakota Horse Breeders and Jockey Trainers Pty Ltd. It denies that it is liable to Phuong. Advise the parties.

Discussion Arguments for Phuong 9.23 Phuong’s case is one of ‘pure’ rather than ‘consequential’ mental harm, as the only harm she suffered is mental or psychiatric in nature. It is not a type of harm that is consequential on her having suffered personal injury. Regardless of whether her case is determined at common law or under the civil liability statutes, Phuong should acknowledge that her claim will be a difficult one to litigate successfully. The first thing Phuong must do is engage with an argument that will likely be submitted by Dakota, to the effect that she has suffered ‘mere grief and sorrow’, [page 477] which does not give rise to liability. Phuong should argue that in fact her symptoms show she has suffered a type of clinical depression. She would maintain that the evidence points towards a conclusion that she suffered the kind of harm required in all jurisdictions, either under statute or at common law, based on what appears to be a complete mental breakdown of a depressive nature. Of course, this determination will ultimately depend on the strength of the evidence presented to the fact finder and the actual medical diagnosis. Indeed, all the evidence indicates the presence of a disabling mental disorder and one for which compensation should be available. She must be able to demonstrate that she suffered a ‘recognised psychiatric illness’, unlike the plaintiffs in Flight Centre Ltd v Louw, whose claim failed because their mental condition did not amount to more than ‘inconvenience, distress and disappointment’. She would argue that if the facts are viewed cumulatively, they point towards Phuong having suffered such a disorder or illness. She experienced terror at seeing what had

happened to Pakuna and developed an unhealthy obsession with the event and an inability to ‘carry on’. She was haunted by the ordeal and became extremely withdrawn as a result of dwelling on her role in what happened to her lifelong, sister-like friend. The civil liability statutes in the Australian Capital Territory, New South Wales, South Australia, Tasmania and Victoria prescribe that to succeed Phuong must prove she has suffered a ‘recognised psychiatric illness’. In Western Australia, this only applies with respect to a claim for consequential mental harm. Assuming that Phuong’s condition is one for which damages may be available, she must demonstrate that she has satisfied the requirements for establishing a duty of care, in the light of legislative prescriptions and High Court of Australia authority. If her claim were decided in Queensland, it would be governed by the common law. In the Northern Territory, legislation about ‘mental or nervous shock’ preceded the High Court cases in Tame v New South Wales; Annetts v Australian Stations Pty Ltd and Gifford v Strang Patrick Stevedoring Pty Ltd. In the other six jurisdictions, she must be mindful to satisfy the statutory criteria, as interpreted by the High Court. Even though a difference emerges as between Wicks v State Rail Authority of New South Wales and King v Philcox with respect to the court’s view on the approach to use when formulating arguments, this should not affect Phuong’s arguments. At common law, in Tame v New South Wales; Annetts v Australian Stations Pty Ltd, Gleeson CJ, Gummow and Kirby JJ held that to be owed a duty of care, the plaintiff does not have to be a person of ‘normal’ emotional health and psychological fortitude. This is not a precondition for recovery. Therefore, even if Phuong could be said to be somewhat unusual in her reactions, this would not be fatal to her claim, in the view of those three members of the High Court. Their Honours emphasised that this requirement distracts attention from the central inquiry: whether in all the circumstances the risk of the plaintiff sustaining a recognisable psychiatric illness was reasonably foreseeable. Based on this reasoning, Phuong’s illness could and indeed on these facts should be held to be foreseeable, in which case she can recover. The more recent High Court case, Wicks v State Rail Authority of New South Wales, also emphasises the importance of the reasonable foreseeability of injury as the central determinant of a duty of care, even when applying the New South Wales legislation. Phuong would argue that she and her condition are certainly reasonably [page 478] foreseeable, as her response to Dakota’s careless conduct is not so extreme or idiosyncratic. Phuong would maintain that the reasonable person in the position of Dakota Horse Breeders and Jockey Trainers Pty Ltd would have foreseen the possibility that anyone who trained with them and had indeed ridden Saki, which included jockeys who were potentially ill, could collapse because of the equine flu. It is reasonably foreseeable that extremely close friends of a jockey might suffer some sort of psychiatric trauma as a result of viewing a race, streamed live on the internet. This is unlike the result reached in Tame, factually, where the plaintiff’s psychotic depressive illness, stemming from a quickly corrected police error, was held not to be reasonably foreseeable. Considering her close and special relationship with Pakuna,

Phuong’s responses are quite predictable and understandable — even expected. They were certainly reasonably foreseeable. In fact, it is arguable that it is reasonably foreseeable that any member of the viewing audience witnessing coverage of the tragedy might be so disturbed by it that she or he suffers a psychiatric illness. On this duty point, Phuong may have to make an argument of this nature in the statutegoverned jurisdictions. If Phuong’s case arose in the Australian Capital Territory, New South Wales, South Australia, Tasmania, Victoria and Western Australia, then Dakota will no doubt argue that, in the words of their Civil Liability Acts, normal fortitude is a requirement. In general terms, Dakota only owed Phuong a duty if it ‘foresaw or ought to have foreseen that a person of normal fortitude might, in the circumstances of the case, suffer a recognised psychiatric illness if reasonable care were not taken’. Focusing on the normal fortitude requirement as a criterion for finding a duty of care, Phuong should confidently maintain that the same facts used to establish reasonable foreseeability at common law would similarly meet the criterion that it was reasonably foreseeable that a person of normal fortitude would suffer as she did. There was nothing abnormal about her response to the collapse and death of her very close friend, with whom she had a lifelong, sister-like relationship. Phuong would again stress that her response was the kind one would expect of a very close friend with whom she had a sister-like relationship and would be the norm across the community. Therefore, even though ‘normal fortitude’ is a requirement under the respective Civil Liability Acts, Phuong can demonstrate that she and her illness are not outside the scope of that criterion. It could perhaps help her case if she could gather evidence of other viewers who developed psychiatric illnesses from watching live graphic coverage of Pakuna’s collapse, although this would not be determinative. Ultimately, the fact finder should conclude that Phuong’s response meets the statutory requirements. As was noted previously, the High Court in Wicks endorsed the centrality of the reasonable foreseeability requirement in the New South Wales statute; the High Court emphasised how the civil liability statutes had to be understood in the context of common law principles relating to psychiatric injury, as stated in Tame. (Notably, in Tame, Gaudron and Hayne JJ reasoned that ‘normal fortitude’ is a convenient means of determining whether a risk of psychiatric injury is foreseeable.) For many years, at common law, Australian courts had held that in order for someone like Phuong to recover, she had to show that her injury was the result of sudden shock. According to Brennan J in Jaensch v Coffey, she needed to suffer ‘shock’ by virtue of [page 479] ‘sudden sensory perception — that is, by seeing, hearing or touching — of a person, thing or event, which is so distressing that the perception of the phenomenon affronts or insults the plaintiff’s mind and causes a recognisable psychiatric illness’. Where the common law governs on this point, Phuong need not worry about having to meet these harsh pre-Tame and Annetts hurdles, because they were finally abandoned by the High Court in Tame and Annetts. By a majority of six to one (Callinan J dissenting), the court

held that liability for damages for psychiatric harm was not limited to cases where that harm is caused by a sudden shock arising as a result of direct perception of a distressing event or its immediate aftermath. Phuong would concede that sudden shock and other factors have been resurrected, to a degree, by statute in the six jurisdictions legislating on this point. In these jurisdictions, to determine the duty question, the court must have regard to a series of factors. For example, it should take into account whether or not Phuong’s mental harm was the result of a sudden shock, the nature of Phuong’s relationship with Pakuna (not a listed factor in Tasmania) and whether Phuong witnessed, at the scene, Pakuna being killed, injured or put in danger (not a listed factor in Tasmania). Phuong would place great reliance on Wicks, where the High Court held that these are mere factors that the court must take into account. As the High Court stated, they are not requirements for the existence of a duty of care. Phuong should argue that she satisfies the ‘shock’ test, as required under the relevant Civil Liability Acts as a factor to be considered. She would contend that watching the event live on the internet should be treated in the same way as being present at the tragic event. The immediacy of the mental harm she suffered was not diminished by the fact that she viewed Pakuna’s death on her laptop, streamed over the internet rather than witnessing what was happening at the race itself. Indeed, it could be more shocking than being at the event, among a crowd, as the images of the heartbreaking event were presumably very detailed when viewed on her laptop. The affront to her senses was probably much greater than if she had witnessed the event in person, as it was graphic coverage, with a clear account of Pakuna’s fall, her pain, her breathing difficulties and ultimate death. In this day and age, it would be rather anachronistic and misguided for a court (and legislature) to determine that the shock she suffered while watching the tragedy on her laptop is different to, and indeed less than, what she would have experienced had she been at the race. Viewing it on the web, on her laptop, is akin to having a front-row seat or even being among the participants. Aside from the duty question, Phuong must satisfy an additional hurdle to be able to establish liability under the statutes in New South Wales, South Australia, Tasmania and Victoria. Because Phuong suffered pure mental harm in connection with Pakuna being put in peril and ultimately dying as a result of Dakota’s carelessness, Phuong cannot recover unless one of two possibilities is satisfied: (i) she witnessed what had happened at the scene (or immediate aftermath, in Tasmania) or (ii) she is a close family member of Pakuna (New South Wales, Tasmania) or in a close relationship (Victoria). In South Australia, because she must be a ‘parent, spouse, domestic partner or child’, Phuong would not be entitled to recover unless she satisfied the ‘witnessed’ limb of this statutory requirement, such that she would have to argue that viewing the tragedy on her laptop meets this requirement, as witnessing the tragic event amounted to virtually being present at the scene (discussed above). Her success here seems unlikely, having regard to the High Court’s reasoning in [page 480] King v Philcox, and the disentitling effect of this provision. It is conceded that this is a

difficult argument to make, bearing in mind the exact wording of the section, which, as the High Court emphasised in rejecting the claim in King, involved being ‘present at the scene of the accident when the accident occurred’. Phuong would also have difficulties in New South Wales and Tasmania, unless she can convince the court to treat her sister-like relationship with Pakuna as similar to the extensive list of ‘family member’ in those statutes, which includes sister, half-sister and stepsister. She should be warned that such a wide interpretation is unlikely under such specifically worded disentitling provisions, especially when Victoria’s much wider provision can be cited by way of comparison. In Victoria, Phuong can prove she was in a ‘close relationship’ with the victim: Phuong was, by all accounts, Pakuna’s lifelong friend — virtually a sister — despite their recent tiff over Pakuna’s participation in the race. Phuong should concede that she would have problems succeeding in the Australian Capital Territory and the Northern Territory, as she is not a family member. Even if she were, under those jurisdictions’ statutory requirements she would only be able to recover if Pakuna was killed within Pakuna’s sight or hearing. She may attempt to build an argument upon some of the High Court’s reasoning in King v Philcox with respect to duty of care and the ‘nature of the relationship’. Finally, Phuong may try to employ the reasoning in Wicks, and the court’s interpretation of the provision in the New South Wales statute concerning what amounts to a shock and witnessing someone in peril. She should however acknowledge that relying on this decision on this point may ultimately be unhelpful, because the context of that case involved police officers’ continuing shock, as a result of having acted as rescuers when they came to the scene of a catastrophic train crash. It is conceded that those circumstances are far removed from what occurred here. Arguments for Dakota Horse Breeders and Jockey Trainers Pty Ltd 9.24 Dakota Horse Breeders and Jockey Trainers Pty Ltd should first note that Phuong’s case must be categorised as one of ‘pure’ rather than ‘consequential’ mental harm, as the only harm she (allegedly) suffered was mental in nature. It was not consequential on personal injury. Dakota should argue that regardless of the jurisdiction in which Phuong’s case is argued, the evidence falls far short of proving the required level of harm or illness to be able to succeed, such as a clinical depression. Her condition — whatever it is — does not reach the threshold that must be satisfied. Rather, it is one borne of mere grief and sorrow and the feelings of guilt she had over her role in Pakuna’s predicament, having failed to stop Pakuna from racing in the cup. At most, Phuong developed anxiety over the event and a fear of intimacy and friendship with other people. It appears that Phuong became withdrawn after the incident, because of how she had let down her friend Pakuna and the heated argument she had with Pakuna before Pakuna died. The cumulative effect of all this is not serious enough to qualify as a disorder or illness seen to be worthy of compensation, both at common law and under statute. Phuong has not suffered a ‘recognised psychiatric illness’, as required in the Australian Capital Territory, New South Wales, South Australia, Tasmania and Victoria. This seems

[page 481] unlikely. Indeed, because all she suffered was a degree of distress and sadness, like the unsuccessful plaintiffs in Flight Centre Ltd v Louw, her claim should fail. However, it is conceded that an assessment of Phuong’s actual condition is a matter for the fact finder, based on the nature and weight of the relevant evidence. Therefore, Dakota would be prepared to further argue that Phuong cannot recover for a range of other significant reasons. For example, she cannot establish that she was owed a duty of care, in accordance with common law and statutory requirements. In Queensland, under the common law, Phuong must demonstrate reasonable foreseeability on the part of Dakota, the criterion that was highlighted by the split decision in Tame. Dakota can confidently argue that a reasonable person running a horse breeding and jockey training enterprise would not reasonably foresee that some act of negligence on its part might cause psychiatric harm to dozens, perhaps hundreds or thousands (or even millions), of members of the public watching coverage of the race on the internet all over the world (or on television, had the race been broadcast on free-to-air TV). Phuong’s idiosyncratic response, becoming obsessed and haunted about this incident, even though she had tried to convince her friend to desist from racing, is not unlike the extreme nature of the plaintiff’s response in Tame — her psychotic depressive illness, derived from a quickly corrected police error. Even with the focus on mere foreseeability at common law, Dakota will maintain that Phuong should fail because, like Tame, on the evidence, there was nothing reasonably foreseeable about the plaintiff’s reactions. Where claims are governed by common law doctrine, Dakota concedes that Phuong does not have to worry about meeting the pre-Tame and Annetts hurdles. These factors have been reintroduced to a certain degree (in somewhat diverse ways) under the Civil Liability Acts. While it is therefore correct to say that in Queensland Phuong does not have to prove that her situation is one involving ‘shock’, ‘sudden sensory perception’ and a distressing affront or insult to her mind, this does not mean she will necessarily recover, as she will have serious problems establishing reasonable foreseeability. If Phuong’s claim were argued in the jurisdictions that introduced legislative provisions relevant to duty of care — the Australian Capital Territory, New South Wales, South Australia, Tasmania, Victoria and Western Australia — her ability to establish a duty would be reduced substantially. Significantly, under the Civil Liability Acts in these jurisdictions, the requirement of ‘normal fortitude’ has been introduced with respect to finding a duty of care. Dakota can convincingly argue that it only owed Phuong a duty if it ‘foresaw or ought to have foreseen that a person of normal fortitude might, in the circumstances of the case, suffer a recognised psychiatric illness if reasonable care were not taken’. The facts considered previously to demonstrate that Phuong’s reaction was unforeseeable would apply equally here. In Wicks, the High Court of Australia stated that the statutory inclusion of normal fortitude as a criterion runs contrary to Tame; indeed, it makes Phuong’s claim unsustainable. There was nothing normal about Phuong’s response to what happened to Pakuna: her illness falls outside the scope of this requirement, as she was suffering mere guilty feelings because she did not convince her friend to withdraw from the race. While others in the same circumstances may have grieved in response to the tragedy,

they would not have suffered mental harm — an abnormal response that could not be anticipated, especially when she was not even a family member nor at the race, witnessing what occurred. In the words of Tame, she was not a person of ‘normal’ emotional health and psychological fortitude. [page 482] In the six legislating jurisdictions, Phuong will be confronted with additional difficulties establishing a duty, because the court must have regard to several factors to determine if she, as a person of normal fortitude, would suffer a recognised psychiatric illness in the circumstances of the case. Those of relevance are whether or not her mental harm was the result of a sudden shock, whether she witnessed, at the scene, Pakuna being killed or put in danger (not a listed factor in the Tasmanian Act), as well as the nature of Phuong’s relationship with Pakuna (not a listed factor in the Tasmanian Act). Although Phuong would rely on Wicks, where the High Court held that these are mere factors the court must take into account and are not strict requirements that must be satisfied to establish the existence of a duty of care, there is no doubt that these factors severely damage Phuong’s case. In Wicks, whose facts bear no resemblance to the present case, the duty was found in the context of police officers acting as rescuers, attending a catastrophic train wreck. The court quite correctly found that the officers had suffered ‘shock’ by coming upon the ‘peril’; they had ‘witnessed’ it. Having regard to these statutory factors, Dakota can refute Phuong’s claim by showing that Phuong did not suffer sudden shock. She already knew of the risk to Pakuna from racing, as she had tried to persuade her to refrain from participating in the cup. Phuong should not have been all that surprised at what ensued. Moreover, Phuong was not at the scene, but merely watching the race on her laptop. Being one of potentially millions of persons worldwide, who watch an event on the internet, should not be treated in the same way as being present at the event. Viewing it through the filter of this medium cannot compare — in terms of perceptions and as an affront to her senses — to witnessing a distressing event of this nature in person. In fact, instead of watching the race on her laptop, Phuong had the option of watching a movie or reading a newspaper online. But, rather curiously and somewhat masochistically, she persisted in watching the event unfold, without turning away. Indeed, she repeatedly viewed clips of the tragic event on YouView. Having regard to another one of the listed factors, Dakota would assert that Phuong was, to be blunt, just one of Pakuna’s friends (and not in an especially close relationship with her). Recounting the harsh words exchanged between Phuong and Pakuna prior to Pakuna’s final race, even Phuong’s purported friendship with Pakuna could be doubted. All these factors point away from Phuong being owed a duty. That said, it should be noted that Phuong may wish to draw upon the High Court’s reasoning in King v Philcox when interpreting the South Australian statute’s duty of care provision, where the nature of a close relationship was said to include a sibling. She may wish to extrapolate upon this point to extend coverage to close friendships. However, once again, the closeness of their relationship could be disputed factually. Aside from the duty question, in New South Wales, Tasmania and Victoria, Phuong’s

ability to recover damages is dependent on her proving certain factors, which differ somewhat among these states. She has to show that she suffered pure mental harm from mental shock in connection with Pakuna being killed and put in peril because of Dakota’s carelessness; and she either witnessed what had happened at the scene (or immediate aftermath, in Tasmania); or was a close family member (or in a close relationship, in Victoria). She fails on all counts. Even in Victoria, Dakota will maintain that Phuong’s friendship with Pakuna does not meet the requirements of a close relationship. In fact, as was noted above, their final interaction was [page 483] rather acrimonious. Dakota would however concede that this ‘close relationship’ assessment will be dependent on all the evidence adduced. Because she is not Pakuna’s sister, despite her claim to have enjoyed a sister-like relationship with Pakuna, Phuong cannot recover in New South Wales and Tasmania. She did not witness Pakuna’s peril at the scene (or aftermath, Tasmania), so she cannot benefit from this alternative basis through which recovery is possible. Phuong also would not succeed in South Australia as she is not within the prescribed list of those who can claim. Seeing that the plaintiff in King was disentitled from recovering because he was not ‘at the accident’, it would be absurd for someone like Phuong, who essentially was doing little more than watching television, to recover. She too was not at the accident. Further, Phuong would fail in the Australian Capital Territory and the Northern Territory, as she is not a family member. Even if she were, under those jurisdictions’ legislative requirements Phuong would only be able to recover if Pakuna was killed within Phuong’s sight or hearing. The broad interpretation given to the nature of relationship in King with respect to duty could not be stretched legitimately to cover what is little more than a friendship, if that, in the instant case. To sum up, although Dakota would concede that Phuong’s prospects of success are greatest in Queensland, Dakota should nonetheless maintain that a duty is not in fact owed even in that state, based on Tame and the foreseeability determination, on the evidence. Further, Phuong only suffered distress and sadness — mere grief and sorrow — which are not compensable in any jurisdiction. Dakota would further conclude that in jurisdictions that have enjoyed legislative interventions, Phuong’s prospects of success are, quite fittingly and appropriately, minimal.

Problem 2 9.25 Recall the problem at 8.60, involving the ‘Pirate’s Plunder’ and its collapsing chairlift. As you may remember, among those trapped on the lift, suspended high above the cove, were Ariana and her 10-year-old son, Bjorn. Bjorn sobbed throughout the

terrifying five-hour ordeal, until he was rescued. Rushed to the hospital, he underwent spinal fusion surgery. The story continues: While listening to her car radio, Carlotta, one of Ariana’s closest friends, was stunned to hear graphic, live coverage of the disaster. Earlier that week, she had urged Ariana to ride the Plunder with Bjorn on New Year’s Day, despite Bjorn’s protests (due to his fear of heights). Fearing the worst, Carlotta’s terror increased as the day wore on. Although Bjorn recovered, Carlotta obsessed over that day’s nightmare, haunted by the image of Bjorn and Ariana ‘just falling out of the sky’. Carlotta developed her own fear of heights, became anxious about seeing her former friends, and quit her job. Other radio listeners complained of anxiety problems arising from listening to coverage of the collapse. Carlotta has sued DareDevil Lifts Pty Ltd. While DareDevil admits carelessness, it denies liability to Carlotta. Advise the parties.

[page 484]

Further discussion 1. Do you agree with the approach of the High Court of Australia in Tame v New South Wales; Annetts v Australian Stations Pty Ltd, whereby the importance of the test of ‘reasonable foreseeability’ has been strengthened, and control devices such as ‘sudden sensory perception’ have been abolished? 2. Of the many legislative changes that have affected the common law doctrine regarding liability for mental harm, whose approach do you prefer and why? 3. Do you agree with the proposition that the ways in which Australian legislatures and courts have responded to claims by persons who suffer mental harm are incoherent and morally unjust? 4. Should the law in Australia recognise a cause of action for intentional infliction of emotional distress falling short of psychiatric injury?

Further reading Balkin R P and Davis J L R, ‘Duty of Care’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 7. Barker K, Cane P, Lunney M and Trindade T, ‘Negligence and the Scope of the Obligation to Take Care: Duty of Care’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 9. Forster C and Engel J, ‘Reinforcing Historic Distinctions between Mental and Physical Civil Liability Reforms’ (2012) 19 Journal of Law and Medicine 593. Handford P, ‘Note: Limiting Liability for Mental Harm: Back to the Future’ (2010) 18 Tort Law Review 5. —, ‘Teaching Psychiatric Injury in a Post-CLA World’ (2010) 18 Torts Law Journal 157. —, ‘Wilkinson v Downton: Pathways to the Future’ (2012) 20 Tort Law Review 145. Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Particular Negligence Situations’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 7. Vines P, San Roque M and Rumble E, ‘Is “Nervous Shock” Still a Feminist Issue? The Duty of Care and Psychiatric Injury in Australia’ (2010) 18 Tort Law Review 9.

1 2

3

4

Law Reform (Miscellaneous Provisions) Act 1956 (NT) s 25. Civil Law (Wrongs) Act 2002 (ACT) s 32; Civil Liability Act 2002 (NSW) s 27; Civil Liability Act 1936 (SA) s 3; Civil Liability Act 2002 (Tas) s 29; Wrongs Act 1958 (Vic) s 67; Civil Liability Act 2002 (WA) s 5Q. Civil Law (Wrongs) Act 2002 (ACT) s 34(1); Civil Liability Act 2002 (NSW) s 32(1); Civil Liability Act 1936 (SA) s 33(1); Civil Liability Act 2002 (Tas) s 34(1); Wrongs Act 1958 (Vic) ss 72(1) (pure mental harm), 74(1)(a) (consequential mental harm); Civil Liability Act 2002 (WA) s 5S(1). Civil Law (Wrongs) Act 2002 (ACT) s 35; Civil Liability Act 2002 (NSW) ss 31 (pure

5 6

7

8 9 10 11

12

13 14

15 16

mental harm), 33 (consequential mental harm); Civil Liability Act 1936 (SA) s 53(2), (3); Civil Liability Act 2002 (Tas) ss 33 (pure mental harm), 35 (consequential mental harm); Wrongs Act 1958 (Vic) s 75. Civil Liability Act 2002 (WA) s 5T. Civil Law (Wrongs) Act 2002 (ACT) s 34(2); Civil Liability Act 2002 (NSW) s 32(2); Civil Liability Act 1936 (SA) s 33(2)(a); Civil Liability Act 2002 (Tas) s 34(2) (first and fourth factors only); Wrongs Act 1958 (Vic) s 72(2); Civil Liability Act 2002 (WA) s 5S(2). Civil Law (Wrongs) Act 2002 (ACT) s 34(4); Civil Liability Act 2002 (NSW) s 32(4); Civil Liability Act 1936 (SA) s 33(3); Civil Liability Act 2002 (Tas) s 34(4); Wrongs Act 1958 (Vic) ss 72(3) (pure mental harm), 74(1)(b) (consequential mental harm); Civil Liability Act 2002 (WA) s 5S(4). Civil Liability Act 2002 (NSW) s 30(1), (2); Civil Liability Act 1936 (SA) s 53(1); Civil Liability Act 2002 (Tas) s 32(1), (2)(a); Wrongs Act 1958 (Vic) s 73(1), (2). Civil Liability Act 2002 (NSW) s 30(5); Civil Liability Act 2002 (Tas) s 32(3). Civil Law (Wrongs) Act 2002 (ACT) s 36(1); Law Reform (Miscellaneous Provisions) Act (NT) s 25(1). Civil Law (Wrongs) Act 2002 (ACT) s 34(3); Civil Liability Act 2002 (NSW) s 32(3); Civil Liability Act 1936 (SA) s 33(2)(b); Civil Liability Act 2002 (Tas) s 34(3); Wrongs Act 1958 (Vic) s 74(2); Civil Liability Act 2002 (WA) s 5S(3). Civil Law (Wrongs) Act 2002 (ACT) s 35(2); Civil Liability Act 2002 (NSW) s 33; Civil Liability Act 1936 (SA) s 53(3); Civil Liability Act 2002 (Tas) s 35; Wrongs Act 1958 (Vic) s 75; Civil Liability Act 2002 (WA) s 5T. Civil Liability Act 2002 (Tas) s 3B(1)(a). Civil Liability Act 1936 (SA) s 51; Wrongs Act 1958 (Vic) ss 28B (definition of ‘injury’ includes ‘psychological or psychiatric injury’), 28C(2)(a); Civil Liability Act 2002 (WA) ss 3 (definition of ‘personal injury’ includes ‘impairment of a person’s … mental condition’), 3A(1). Civil Law (Wrongs) Act 2002 (ACT) s 35(2); Civil Liability Act 2002 (NSW) s 31; Civil Liability Act 2002 (Tas) s 33; Wrongs Act 1958 (Vic) s 75 (economic loss damages). Civil Liability Act 1936 (SA) s 53(2).

[page 485]

10 Defence: Contributory Negligence Objectives After completing this chapter, you should: — understand the ways in which fundamental ‘contributory negligence’ principles operate, including those associated with: — the standard of care assessment; — causal potency; — understand the ways in which legislative schemes changed the harshness of the common law’s ‘all-or-nothing’ rule, replacing it with apportionment; — understand the legal effect of the plaintiff’s intoxication on her or his claim, at common law and under legislative schemes.

Key cases — Allen v Chadwick (2015) 256 CLR 148 — Butterfield v Forrester (1809) 11 East 60; 103 ER 926 — Consolidated Broken Hill Ltd v Edwards (2005) Aust Torts Reports ¶81-815; [2005] NSWCA 380 — Czatyrko v Edith Cowan University (2005) 214 ALR 349

— Joslyn v Berryman; Wentworth Shire Council v Berryman (2003) 214 CLR 552; 198 ALR 137 — McLean v Tedman (1984) 155 CLR 306; 56 ALR 359 — Pennington v Norris (1956) 96 CLR 10 — Russell v Edwards (2006) NSWLR 373; Aust Torts Reports ¶81-833; [2006] NSWCA 19 [page 486]

Key legislative developments All jurisdictions’ Civil Liability or Wrongs or Law Reform Acts prescribe: — the consequences of the plaintiff’s contributory negligence on the plaintiff’s claim. Some jurisdictions’ Acts prescribe: — the consequences of a plaintiff’s intoxication on her or his claim, where it is causally connected to her or his harm.

Introduction 10.1 If someone fails to do what a reasonable person would do, or does what a reasonable person would not do, the law characterises that conduct as negligent. This applies to plaintiffs in the same way that it applies to defendants. If a plaintiff fails to take reasonable care for her or his own safety, then she or he, too, is negligent. At common law, the defendant could raise any negligence on the part of the plaintiff as a complete defence to the plaintiff’s action.

Key Case Butterfield v Forrester (1809) 11 East 60; 103 ER 926 Facts: The defendant put a pole across part of the road outside his house, in order to block the road so that he could do repairs on the house. The plaintiff was injured when he rode his horse into the pole, and he sued the defendant. The evidence established that the accident occurred at twilight, that the plaintiff was riding his horse at great speed, and that he was very drunk. Issue: What was the legal effect of the plaintiff’s conduct? Decision: Lord Ellenborough CJ said (at East 61; ER 927): Two things must concur to support this action, an obstruction in the road by the fault of the defendant, and no want of ordinary care to avoid it on the part of the plaintiff. As the plaintiff had failed to take ordinary care for his own safety, his action failed completely.

10.2 Thus, at common law, if the plaintiff’s injuries were caused partly by the defendant’s negligence and partly by the plaintiff’s own negligence, the plaintiff bore the whole of the loss. The harsh effects of this rule were ameliorated by what was known as the ‘last opportunity’ rule. According to this rule, the plaintiff’s own negligence was a defence only if she or he had the last opportunity of avoiding the accident; if the defendant had the last opportunity of avoiding the accident, then the defendant was liable in full. [page 487] For example, in Davies v Mann (1842) 10 M & W 546; 152 ER 588, the plaintiff tethered his donkey’s forefeet, and left it to wander on the road, where it was run over and killed by the defendant’s carriage. It was held that the plaintiff’s action against the defendant succeeded, even though the donkey’s death was partly caused by the plaintiff’s

own fault in letting the donkey wander on the road, because the defendant had had the last opportunity of avoiding the accident. 10.3 The effect of these common law rules was ‘all-or-nothing’ recovery for the plaintiff. If both the plaintiff and the defendant had been negligent, the plaintiff either won completely or lost completely, depending on who it was that had the last opportunity of avoiding the accident. In Admiralty proceedings (that is, in actions about damage caused by and to ships) there was a different rule. If both ships involved in a collision were at fault, any losses suffered were borne equally by both parties: see Wildman v Blakes (The Petersfield and the Judith Randolph) (1789) Burrell 332; 167 ER 596. Although the Admiralty rule avoided the all-or-nothing result of the common law rules, it, too, provided only rough justice. The losses were split equally between the parties, whether or not they had been equally at fault. 10.4 Justice seemed to require that where both plaintiff and defendant were at fault, each party should bear a part of the resulting loss in proportion to the degree of her or his fault. Some juries in the 19th century apportioned liability in this way, with the judges apparently turning a blind eye to the fact that such verdicts were contrary to the rule in Butterfield v Forrester: see, for example, Raisin v Mitchell (1839) 9 C & P 613; 173 ER 979 and Smith v Dobson (1841) 3 Man & G 59; 133 ER 1057. However, these were isolated occurrences. The common law proved incapable of ridding itself of the all-ornothing rules, which stayed in place until they were finally changed by legislation.

Statutory Intervention: Apportionment Replaces the Common Law’s ‘All-or-Nothing’ Rule 10.5 The very first piece of legislation providing for apportionment of liability according to relative degrees of fault applied only to the Admiralty jurisdiction, replacing the old 50–50 rule in Admiralty: see Maritime Conventions Act 1911 (UK). The first common law

jurisdiction to introduce general apportionment legislation was Ontario, which replaced the common law rules in 1924 (Statutes of Ontario 1924 c 32). In 1945 the United Kingdom likewise legislated for apportionment in the Law Reform (Contributory Negligence) Act 1945 (UK). This Act has now been used as the model for legislation in most common law jurisdictions. There is now apportionment legislation in every Australian jurisdiction. The most important feature, common to all the provisions, is the fact that a finding of contributory negligence cannot defeat the plaintiff’s claim. However, at this stage, it is worth noting that rather curious provisions in several jurisdictions now prescribe that a plaintiff can in fact be held to be 100 per cent contributorily negligent: see 10.28. [page 488] In Joslyn v Berryman; Wentworth Shire Council v Berryman (2003) 214 CLR 552; 198 ALR 137 (see 10.10, 10.13, 10.36), McHugh J canvassed the history of contributory negligence in great detail, including how, prior to the introduction of apportionment legislation, the harshness of a contributory negligence finding affected judicial decision making. 10.6 The relevant provisions common to the Australian Capital Territory, New South Wales, the Northern Territory, Queensland, Tasmania and Victoria prescribe the following (in general terms; not all minor variations are noted):1 (1) If a person (‘the claimant’) suffers damage as the result partly of the claimant’s failure to take reasonable care (‘contributory negligence’) and partly of the wrong of any other person or persons: (a) a claim in respect of the damage is not defeated by reason of the contributory negligence of the claimant; and (b) the damages recoverable in respect of the wrong must be reduced to such extent as the court thinks just and equitable having regard to the claimant’s share in the responsibility for the damage. (1A) Sub-section 1 does not operate to defeat any defence arising under a contract.

The South Australian provisions 2 are cast somewhat differently: 7(1) If contributory negligence contributes to (but is not the sole cause of) the harm for which a claimant seeks damages, the claim is not to be defeated on the ground of the contributory negligence. 7(2) If a claimant’s harm is caused partly by another’s negligent wrongdoing and partly by contributory negligence, the court must proceed as follows: (a) the court must determine (and record) the amount of the damages to which the claimant would have been entitled assuming there had been no contributory negligence; and (b) the court must then reduce the amount so determined to the extent the court thinks just and equitable having regard to the extent the contributory negligence contributed to the harm.

Statutory and contractual modifications, exclusions or limitations binding on the plaintiff, such as those relating to intoxication and illegality, also have to be taken into account under this Act. The wording in Western Australia’s statute 3 stands out as unique: 4(1) Whenever in any claim for damages founded on an allegation of negligence the Court is satisfied that the defendant was guilty of an act of negligence conducing to the happening of the event which caused the damage then notwithstanding that the plaintiff had the last opportunity of avoiding or could by the exercise of

[page 489] reasonable care, have avoided the consequences of the defendant’s act or might otherwise be held guilty of contributory negligence, the defendant shall not for that reason be entitled to judgment, but the Court shall reduce the damages which would be recoverable by the plaintiff if the happening of the event which caused the damage had been solely due to the negligence of the defendant to such extent as the Court thinks just in accordance with the degree of negligence attributable to the plaintiff …

10.7 Strictly speaking, the apportionment legislation abolished the all-or-nothing defence of contributory negligence, and replaced it with a statutory system of apportionment of liability in proportion to the relative degrees of fault (in terms of failure to take care and causal potency or contribution) on the part of the plaintiff and the defendant. However, it is still customary to describe an allegation that the plaintiff’s injuries were partly caused by her or his own fault as being the defence of ‘contributory negligence’.

The way in which apportionment operates is considered at 10.25. Before we embark on that discussion, we will first explore how a ‘failure’ is determined for the purposes of finding contributory negligence and how causation works in the context of this defence.

What Constitutes Contributory Negligence? The plaintiff’s conduct to herself or himself 10.8 Unlike negligence on the part of a defendant, the plaintiff’s conduct need not put anyone else at risk in order for it to constitute contributory negligence. Contributory negligence is simply a failure by the plaintiff to take reasonable care for her or his own safety. This may but need not also constitute a breach of a duty of care owed to someone else. In Commissioner of Railways v Ruprecht (1979) 142 CLR 563 at 570; 25 ALR 481 at 487 (for the facts, see 10.16), Mason J said: Contributory negligence differs from negligence. There is no duty of care owed to another person … and contributory negligence involves conduct which exposes the actor to the risk of injury without necessarily exposing others to risk.

Case Example Davies v Swan Motor Co (Swansea) Ltd [1949] 2 KB 291 Facts: The plaintiff’s husband was a garbage collector who was killed while riding on the step of a garbage truck, contrary to specific instructions from his employer. He was killed when a bus ran into the garbage truck, crushing him between the vehicles. The plaintiff alleged that her husband’s death had been caused by the negligent driving of the bus driver, who was an employee of the defendant. Issue: Did the conduct of the deceased amount to contributory negligence? Does this concept embrace a duty to take care? [page 490] Decision: The Court of Appeal held that the bus driver had been negligent and that the plaintiff’s husband had been contributorily negligent. Denning LJ stated (at 324–5): It has sometimes been suggested that an injured plaintiff is not guilty of contributory negligence unless he was under a duty of care towards the

defendant … In my opinion, it is not a correct approach. When a man steps into the road he owes a duty to himself to take care for his own safety, but he does not owe any duty to a motorist who is going at excessive speed to avoid being run down [sic]. Nevertheless, if he does not keep a good lookout, he is guilty of contributory negligence. The real question is not whether the plaintiff was neglecting some legal duty, but whether he was acting as a reasonable man and with reasonable care. When he stood on the step of the truck, the plaintiff exposed himself to an unreasonable risk of injury. This constituted contributory negligence, even though the plaintiff’s conduct did not pose a risk of injury to anyone other than himself.

10.9 It used to be assumed that the apportionment legislation could apply to claims for breach of contract. However, in Astley v Austrust Ltd (1999) 197 CLR 1; 161 ALR 155, the High Court of Australia held that the defence of contributory negligence and the apportionment legislation applied only to tort actions. As a result of Astley, all jurisdictions in Australia amended their apportionment legislation. They all now cover actions in contract.4 Similar provisions are found in the Acts of the Australian Capital Territory, the Northern Territory, Queensland, Tasmania and Victoria, which state, in general terms (and with a few noteworthy differences): ‘wrong’ means an act or omission that: (a) gives rise to a liability in tort [in the Northern Territory, ‘in the tort of negligence’; in Tasmania, ‘or would, if it caused damage to another person, give rise to a liability in tort’] in respect of which a defence of contributory negligence is available at common law; or (b) amounts to a breach of a contractual duty of care that is concurrent and coextensive with a duty of care in tort. [In Tasmania: ‘and includes an act or omission on the part of a person suffering damage that causes or contributes to the damage and that constitutes a failure on the part of that person to take reasonable care for the protection of his or her person or property’].

South Australia defines ‘negligent wrongdoing’ to include breach of a contractual duty of care and breach of a statutory duty. The latter is also specifically covered in the Northern Territory and Tasmania: see Chapter 13. In Western Australia, the provisions are set out rather differently,

with reference to ‘negligence’, which includes breach of statutory duty. The Law Reform (Contributory [page 491] Negligence and Tortfeasors’ Contribution) Act 1947 (WA) s 4(1A) also provides that the apportionment section ‘shall not operate to defeat any defence arising under a contract’.

The Standard of Reasonable Care Applied to the Plaintiff’s Conduct The objective standard: at common law 10.10 An exploration of the nature of the ‘objective standard’ to be applied when assessing the plaintiff’s conduct arises quite frequently in the case law. It was considered in the leading High Court of Australia decision, Joslyn v Berryman; Wentworth Shire Council v Berryman. In his detailed analysis of contributory negligence doctrine, McHugh J stated (at [32]): The test of contributory negligence is an objective one. Contributory negligence, like negligence, ‘eliminates the personal equation and is independent of the idiosyncrasies of the particular person whose conduct is in question’ [Glasgow Corporation v Muir [1943] AC 448 at 457].

Lengthy extracts from this case, which arose in the context of a guest passenger and driver affected by intoxication are included at 10.36. In this case, McHugh J also considered the way in which contributory negligence should apply to children and plaintiffs with disabilities: see 10.13.

The objective standard: under statutory interventions (related to the Ipp Panel recommendations) 10.11

In an effort to compel courts to take a stricter approach than

had emerged in practice, all jurisdictions except the Australian Capital Territory and Northern Territory prescribe that the plaintiff’s contributory negligence in failing to take precautions against the risk of harm must be assessed using the same principles that are employed to measure the reasonableness of the defendant’s conduct.5 These provisions are intended to strengthen or add rigour to the way in which the standard of care approach is applied to plaintiffs. The Acts (generally) state that the standard of care required of the person who suffered harm is that of the reasonable person in their position, and that the matter is to be determined on the basis of what that person knew or ought to have known at the time. Under these provisions, the objective test remains grounded in reasonableness, in the circumstances of the case. As is the case with the defendant’s conduct, the ‘calculus of negligence’ also is to be applied to the plaintiff’s conduct. [page 492] Key Case Consolidated Broken Hill Ltd v Edwards (2005) Aust Torts Reports ¶81-815; [2005] NSWCA 380 Facts: The plaintiff, a cyclist, tried to cycle across a narrow space on a bridge, on land occupied by the defendant. The bridge carried a railway spur line. His jumper caught on a protrusion from a rail wagon, as a result of which he fell into a creek bed; he became paraplegic. The defendant had not taken any steps to prevent the public (which it knew had used the bridge in risky circumstances for a long time) from having access to its land or the bridge. Issue: Was the plaintiff contributorily negligent (in the context of the statutory changes related to the Ipp Panel’s recommendations)? Decision: The New South Wales Court of Appeal considered s 5R of the Civil Liability Act 2002 (NSW) and in doing so had regard to the Second Reading Speech introducing the relevant bill, which itself referred to the Ipp Panel Report and the panel’s view of community expectations in this context (in [8.10]): individuals should care for themselves as much as they expect others to care for them — the fundamental notion is that people should take responsibility for their own lives and safety. The court assessed the blameworthiness and causal contribution of both parties and, in doing so, rather

surprisingly when compared to the general approach of courts of review (see 10.32), increased the trial judge’s contributory negligence finding from one-third to 50 per cent.

The following cases provide additional examples of the approach that is meant to be used. In Carey v Lake Macquarie City Council (2007) Aust Torts Reports ¶81-874; [2007] NSWCA 4, a cyclist ran into a bollard (see 11.27 for the facts and a discussion of ‘obvious risk’ under the Civil Liability Act 2002 (NSW)). McColl JA (of the New South Wales Court of Appeal) wrote a separate concurring judgment that considered Consolidated Broken Hill Ltd v Edwards and the statutory interventions to contributory negligence derived from the Ipp Panel recommendations. Endorsing the trial judge’s contributory negligence finding, McColl JA stated (at [11], [13]): [T]here could be no doubt, applying s 5R, that the appellant was guilty of contributory negligence. First, he took the lower path without thinking about the likelihood he might encounter a bollard. … [A] reasonable person in the appellant’s position would have been alert to the risk of encountering a bollard in the dark as he took the lower pathway and should have travelled extremely slowly, braking rather than freewheeling, conscious of what was immediately in front of him and able to stop in a very short distance. … … [T]he appellant’s culpability was not such as to attract a 100 per cent reduction on account of his contributory negligence. While he did not take precautions against the risk of harm, the respondent’s negligence was also causative of his injuries. … [T]the culpability of the appellant and the respondent were equal such that they should bear equal liability for the damage.

[page 493] In Perrett v Sydney Harbour Foreshore Authority [2009] NSWSC 1026, an individual fell down three steps in the foyer of the Darling Harbour Convention Centre, severely injuring himself. The defence of voluntary assumption of risk failed (this was not an ‘obvious risk’ under the Act), as did the notion that the case involved an ‘inherent risk’: for a discussion of these concepts, see 3.71 and Chapter 11. With respect to

contributory negligence, the court held (at [93]–[94]), applying s 5R of the New South Wales Civil Liability Act 2002: The principles applicable in determining whether Mr Perrett has been contributorily negligent are the same as those applicable in determining negligence on the part of a defendant: see s 5R … The task is to determine whether Mr Perrett contributed to his fall by failing to take care of himself against the measure of a reasonable person in his position. … The test directs attention to the standard of care required of a reasonable person in the position of Mr Perrett, on the basis of what he knew or ought to have known at the time. I am not satisfied that Mr Perrett ought to have known of the presence of the steps. I do not think he overlooked their presence due to inadvertence on his part, but rather due to … the absence of edging on the steps, the distracting presence of the sign set back from the top of the first step and the presence of other people in the area.

Although courts do not always refer explicitly to the statutory provisions, the approaches they use to determine contributory negligence suggest that they are indeed (usually) being applied, albeit implicitly. In yet another cycling case, Council of the City of Greater Taree v Wells [2010] NSWCA 147, a cyclist ran into a chain slung across a path (see 11.27 for the facts and a discussion of ‘obvious risk’ under the Civil Liability Act 2002 (NSW)). The New South Wales Court of Appeal applied Consolidated Broken Hill Ltd v Edwards and Joslyn v Berryman; Wentworth Shire Council v Berryman, noting (at [83]), ‘contributory negligence is determined objectively from the facts and circumstances of a case, which includes what the plaintiff knew or ought to have known at the time’. The court held that the fact that the cyclist did not detect the low-slung chain did not amount to contributory negligence, as he had exercised reasonable care for his safety in the circumstances. Basten JA’s separate concurring judgment explored, in detail, the way in which the new sections are intended to operate. He noted (with obiter comments about the workplace) (at [111]–[112]): The Ipp Report was concerned to reject the suggestion that some lesser standard was to be applied, such as that identified by Murphy J in [Commissioner of Railways v Ruprecht [1979] HCA 37; 142 CLR 563] (at 578–9) namely that, in the case of an

employee, where there was ‘no conscious deliberate disregard of safety’, there was no contributory negligence. It is sufficient for present purposes to treat s 5R as requiring the standard of care be the same as that applied in negligence …

On the facts, Beazley JA (with whom McColl JA agreed) concluded (at [86]): The respondent’s speed was reasonable; the presence of the chain was unexpected, having only been erected two days prior to the accident; and, significantly, the

[page 494] colour of the chain blended into the concrete below. … [T]he trial judge’s reasons were appropriately based on the evidence and, although his Honour made no mention of s 5R, it is apparent from his reasons that he had regard to it.

The New South Wales Court of Appeal again applied Consolidated Broken Hill Ltd v Edwards and Joslyn v Berryman; Wentworth Shire Council v Berryman in Harmer v Hare [2011] NSWCA 229, holding that contributory negligence should not apply. The plaintiff (respondent) drove a car belonging to his friend of many years, the passenger– defendant (appellant), who was too intoxicated to drive. Unknown to the plaintiff, the car was dangerous, as its tyres were bald. The plaintiff was injured when the car slid on a wet road surface. Not surprisingly, the defendant’s rather bold (and misguided) argument that a 100 per cent finding be made for contributory negligence failed (see 10.28). The court allowed the respondent’s cross-appeal, reversing the trial judge’s contributory negligence finding, whereby a 25 per cent reduction in the damages award had been made. The court held that a reasonable person in the plaintiff’s position would not have asked the defendant– owner about the car’s condition.

Modification of the objective standard (or a degree of leniency) in some contexts? 10.12 Although the plaintiff’s conduct is judged against the standard of reasonable care, common law principles had emerged that allowed a

degree of leniency to be exercised in certain contexts, with particular types of plaintiffs. Issues involving children, individuals with intellectual disabilities, individuals with physical impairments, workers, and individuals acting in response to emergencies have been and continue to be of particular concern to the courts in determining whether an objective standard of care should apply to the plaintiff’s conduct. Children 10.13 The case law decided in the absence of the statutory interventions influenced by the Ipp Panel Report suggests that a plaintiff’s conduct will be measured against a lower standard of care where the plaintiff is a child. Aside from highlighting the fact that the contributory negligence assessment is an objective inquiry, in Joslyn v Berryman; Wentworth Shire Council v Berryman (see 10.5, 10.36) McHugh J commented on cases involving children and other classes of plaintiffs (at [32], [34]–[35]): One exception to that [objective rule, eliminating the personal equation and independent of idiosyncrasies] … is that, in considering whether a child is guilty of contributory negligence, the standard of care is tailored to the age of the child. It may be the law that, in the case of an aged plaintiff, the standard of care is also tailored to the age of the plaintiff. … ‘[I]n theory, a plaintiff is required to conform to the same standard of care as a defendant, with due allowance for the fact that here the enquiry is directed to what is reasonable for his own safety rather than the safety of others’ [J G Fleming,

[page 495] The Law of Torts, 9th ed, LBC Information Services, Sydney, 1998, p 318]. No one would now suggest that the standard of care expected of a defendant is that which the defendant ‘is in fact capable of’. To introduce such a standard into the law of contributory negligence would not only contradict the objective test of contributory negligence, it would impose on tribunals of fact the almost insuperable task of determining what standard of care the plaintiff was ‘in fact capable of’. … [C]ommon law courts have accepted that, in determining whether a child is guilty of contributory negligence, the relevant standard of care is that to be expected of an ordinary child of the same age. But otherwise the plaintiff is held to the standard of

care expected of an ordinary reasonable person engaging in the conduct that caused the plaintiff’s injury or damage. No exception should or could in principle be made in the case of the passenger accepting a lift from an intoxicated driver.

As Joslyn stated, and the next case shows, the courts apply a standard of care that reasonably would be expected of a child of similar age. Case Example Kelly v Bega Valley County Council (NSWCA, Hope, Glass and Samuels JJA, 13 September 1982, unreported) Facts: The plaintiff was an 11-year-old boy who was injured by electrocution after touching a high-voltage light pole terminal. The jury found for the plaintiff but reduced the damages by 75 per cent. Issue: What is the effect, if any, of the plaintiff’s young age on how the court should assess the reasonableness of the plaintiff’s conduct? Decision: The New South Wales Court of Appeal held that the trial judge was correct in directing the jury that they could reduce a damages award if they found the plaintiff contributorily negligent. However, the court found that the jury’s assessment had been perverse and substituted a reduction of 25 per cent. Glass JA stated: [T]he conduct of a particular infant plaintiff charged with contributory negligence is to be measured according to the hypothetical conduct of an infant of the same age. Since the measure is objective and not subjective, references to the intelligence, experience and development of the child are to be treated as allusions to the notional levels of intelligence, experience and development which a child of that age could be expected to have attained.

At face value, the common law ‘concession’ offered to children plaintiffs might appear to be diminished, because of the changes effected by all states’ Civil Liability Acts. However, as the following case shows, this is not so. In Doubleday v Kelly [2005] NSWCA 151, the relevance of the seven-year-old child’s age was considered in the ‘obvious risk’ context: see 11.27. The New South Wales Court of Appeal also held that the child’s age was relevant to an assessment of reasonableness in the circumstances, despite the defendant’s argument that s 5R(2) precluded a

[page 496] consideration of age. Rejecting this contention, endorsing Joslyn and ultimately not finding contributory negligence, the court stated (at [26]): That would be a radical departure from the Common Law and I do not think that subs (2)(a) [of s 5R of the Civil Liability Act 2002 (NSW)] was intended to create such a departure. The characteristics of a reasonable person in the position of the person who suffered harm include the characteristics of being a child of seven years. As the trial Judge said, ‘In assessing these matters the law takes into account the age and the situation of the plaintiff’. His Honour’s statement ‘… It cannot be concluded against the plaintiff, that a seven year old child normally would or should have a perception of those dangers …’ (ie the danger of going on a trampoline) is plainly correct …

Cases involving children as plaintiffs and lowered standards of care were used by the majority in the leading case, McHale v Watson (1966) 115 CLR 199; [1966] ALR 513 (see 3.6), to help justify the conclusion that the (objective) standard of care of children defendants should be lowered (modified). Menzies J dissented, stating that it was misguided and inappropriate for the court to use contributory negligence case law, involving the standard of care appropriate to a child plaintiff’s conduct, as a rationale to justify the majority’s conclusion regarding a child defendant. In his view, this was because of the significantly different loss distribution and loss-bearing consequences that arise from the respective modifications. Under the Acts, a child plaintiff’s conduct is to be assessed in accordance with what would be expected of a child defendant. On this basis, using the same standard of care approach, the McHale ‘modification’ would be relevant and the child would be measured against the adjusted cohort. The curious circularity of this is noteworthy, in that it was the contributory negligence case law that was employed in McHale to justify the modified (lowered) standard of care for child defendants. (This is the very thing Menzies J objected to in his dissenting opinion.) Felhaber v Rockhampton City Council [2011] QSC 23 is a reminder that

all the circumstances of the case must be considered when making the standard of care and contributory negligence assessment. Here, the fact that the plaintiff was 17 years old was of no concern to McMeekin J of the Queensland Supreme Court. In this case, the 17-year-old diver broke his neck, having dived head first from a makeshift rope hanging from a tree in a recreational area managed by the defendant, landing too close to a riverbank. Although McMeekin J was primarily concerned with assessing breach, which was not found using classic common law principles, he stated, in obiter, that the manner in which the plaintiff executed his dive amounted to 50 per cent contributory negligence. According to the court, the diver failed to keep a safe distance from the river bank, which should have been the main focus of his attention. McMeekin J also held that the voluntary assumption of risk defence would succeed on these facts (see Chapter 11). By way of contrast, in Lennon v Gympie Motel [2016] QSC 315, a contributory negligence finding of 15 per cent was imposed on a plaintiff who was rendered a tetraplegic as a result of diving into a pool at the Gympie Motel, when she was 12 years and nine months of age. There were no depth markers or signs prohibiting diving around the pool. Using an objective test and applying McHale v Watson, [page 497] Flanagan J held (at [197]) that the plaintiff failed to exercise that degree of care for her own safety which might reasonably be expected of an ordinary child of the same age. Flanagan J stated (at [202]), obiter, that had the plaintiff been an adult the reduction for contributory negligence would have been 25–35 per cent. In Verryt v Schoupp (2015) 70 MVR 484; [2015] NSWCA 128, the respondent, aged 12, suffered serious head injuries when he fell from his skateboard as he and two other boys held onto the car being driven by the appellant up a hill at a speed of 10–15 km per hour. The respondent was not wearing a helmet. The appellant, a mature adult,

had allowed the three boys to participate in this activity, known as ‘skitching’. The New South Wales Court of Appeal applied McHale v Watson. Meagher JA (Gleeson JA and Sackville AJA agreeing) held that in apportioning responsibility, some account must be taken of the respondent engaging in an activity that carried some risk of injury. However, they also observed that a 12-year-old child is unlikely to perceive the real prospect of serious injury. The appellant had a much greater responsibility for the injuries as he was in control of the vehicle, aware that none of the boys were wearing helmets and in a position to prevent the activity. The court held that it was ‘just and equitable’ to hold the respondent partially responsible, assessing contributory negligence at 10 per cent. Intellectually impaired persons and physically disabled persons 10.14 The legal significance of a plaintiff’s intellectual disability was explored in the following case, which was governed by common law principles. Case Example Russell v Rail Infrastructure Corporation [2007] NSWSC 402 Facts: A 21-year-old woman with a mild intellectual disability and her friends passed through a gap in a carelessly maintained chain linked fence, onto a freight train line. Trying to copy the manoeuvre of an athletic friend (and wanting to ‘look cool’), she climbed onto the side of a slow moving goods train; as it gathered speed, she panicked, let go and was dragged some distance. Her serious leg injuries led to a subsequent amputation. Issue: Should the plaintiff’s intellectual disability affect the court’s assessment of the reasonableness of her conduct in the circumstances and whether or not she was contributorily negligent? Decision: Bell J, of the New South Wales Supreme Court, applied Joslyn and noted that the test is objective and independent of idiosyncrasies. However, she observed that an exception is made for children and possibly aged persons. She stated (at [94], [96]): The reasons that inform the adoption of an objective standard that is tailored to the recognised limitations of childhood (or, it may be, great age), may be thought equally applicable to the limitations of intellectual incapacity. It is true that childhood is not an idiosyncrasy; all adults have experienced it. Intellectual

disability may be idiosyncratic but it is a condition that is capable of assessment by standardised measures. [page 498] One can posit an objective standard to which a person possessed of mild or moderate or profound intellectual handicap … is to be held as much as one can posit the objective standard to which a child of four or nine or 13 is to be held. If it is against the policy of the law to hold a child with his or her limited understanding to the standard of care of the reasonable person there may be thought equally strong reasons for not applying the standard of the reasonable person to a plaintiff with a recognised degree of intellectual incapacity. (Lord Hoffmann considered that the reason for holding children who lack a full understanding of the danger of an activity to a different standard in dealing with contributory negligence is because it would not be just and equitable to do so and that the same consideration may apply to a person of unsound mind: Reeves v Commissioner of Police of the Metropolis [2000] 1 AC 360 at 371–372). … I should determine the defence of contributory negligence by considering whether the plaintiff failed to take the reasonable care for her own safety that is to be expected of a reasonable adult having a mild degree of intellectual handicap. The test remains objective and I do not take into account considerations peculiar to the plaintiff, albeit that they may be related to her disability, such as her childlike personality and tendency to be easily led. Despite having made this modification (to a still objective standard), Bell J found contributory negligence. She stated (at [97]) that a reasonable person with a mild degree of intellectual disability (at the plaintiff’s level) ‘would nonetheless have appreciated that in jumping onto a slow moving goods train she was exposing herself to a risk of serious injury’. She continued (at [98]): The plaintiff’s want of care for her own safety was considerable albeit not as considerable as the want of care of a reasonable person without intellectual disability who jumped onto a slow moving goods train. This is because persons with a mild degree of intellectual impairment have a lesser capacity to reason and to exercise judgment based upon reason than those who are not impaired. The plaintiff’s conduct was a direct cause of her injury. The defendant’s conduct in not preventing members of the public including the plaintiff from gaining access to the line was a significant departure from the standard of care that it owed to her. The defendant’s conduct, too, was a direct cause of her injury in that but for the gap in the fence and the path leading to the line, the accident would not have occurred. I consider that it is just and equitable to reduce the damages recoverable by the plaintiff by 50 per cent to take account of her contributory negligence. Arguments based on the defence of voluntary assumption of risk failed.

In the following tragic case, the Supreme Court of Western Australia, Court of Appeal, comprised of Martin CJ, McLure P and Murphy JA, considered whether or not someone with severe physical disabilities and severe intellectual impairment can or indeed should be found contributorily negligent. During the course of the lengthy, thoughtful decision, the court considered the history of contributory negligence in Australia and the United Kingdom and whether an objective test must be used. The court reached a split view with respect to this central legal issue; the court also split, but differently, with respect to the result. The following lengthy extract highlights the difficulties that can arise in this context. [page 499] Case Example Town of Port Hedland v Hodder (No 2) (2012) 294 ALR 315; 43 WAR 383 Facts: The plaintiff was born prematurely with cerebral palsy and an intellectual disability; he was deaf, virtually blind and unable to speak. He also was born with spastic diplegia. At age 22, he and most of his family went to the South Hedland Aquatic Centre (SHAC), which was managed by the YMCA. When he was left unattended, the plaintiff got onto one of eight diving blocks that had been placed at the shallow end of the swimming pool. He dived into the water, striking his head on the pool’s bottom, fracturing his spine. He became quadriplegic. He sued the town and YMCA in negligence and the town claimed contribution from the YMCA with respect to any damages it might be held to owe the plaintiff. The trial judge held the town liable. Although the YMCA had breached its duty (lack of supervision and non-provision of warning signs regarding the use of the blocks), neither was held to be a cause of his harm. The plaintiff was found to be 10 per cent contributorily negligent. The town appealed the liability finding, and the plaintiff appealed the contributory negligence finding. Issues: For present purposes, the relevant issues were: should an entirely objective test be used to determine contributory negligence when the plaintiff has severe physical and intellectual disabilities? On the facts, had the plaintiff acted unreasonably to himself? Decision: Favouring the town, McLure P and Murphy JA agreed with the trial judge that the plaintiff’s physical disabilities should not be taken into account when determining if he had been contributorily negligent. Martin CJ dissented strongly on this point. However, McLure P held that the trial judge erred on these facts, when he reduced the

damages award for contributory negligence. Murphy JA dissented on this point. Ultimately, the plaintiff was awarded the full amount of the damages that had been assessed — $6.5 million. With respect to the primary issue, as to whether an entirely objective test should be used when the plaintiff is severely disabled, McLure P noted that the attenuation of the standard of care for children (discussed in Imbree v McNeilly (2008) 236 CLR 510; 248 ALR 647 and at issue in McHale v Watson with respect to child defendants) had not been widened to include other classes of persons with impaired capacity for foresight. Joslyn v Berryman was cited to the same effect, in the contributory negligence context. Russell v Rail Infrastructure Corporation was considered problematic, as it had been based in part on Cook v Cook (1986) 162 CLR 376; 68 ALR 353, which had since been overruled by Imbree. Further, in her view, s 5K of the Civil Liability Act 2002 (WA) did not affect the need to use an objective test. McLure P stated (at [298]): … there is no intermediate appellate court decision on equivalent legislation in other states suggesting or holding that the standard of care in contributory negligence is subjective or that there is an attenuated standard of care for any class other than children. Until the High Court otherwise decides, I would apply the law as stated in Joslyn. Murphy JA agreed with McLure P on this key issue (at [345]–[346]): [page 500] This review of the case law indicates to me that until the High Court indicates otherwise, the standard of care is, in general principle, objective and applies equally in the case of negligence and contributory negligence, to activities voluntarily and autonomously undertaken. Where a person has a physical disability which impairs their capacity to undertake an activity involving risk, the application of the standard of care is not so crude as to impute to them the ability to do that which they are physically unable to do. However, it does require them to take other steps in order to exercise reasonable care for their safety and the safety of others. That may include, in some circumstances, deferring the activity or not undertaking it at all. The objective standard also precludes exculpation on the basis that the person failed, through intellectual impairment or otherwise, subjectively to comprehend the risk which they were posing to themselves or others in undertaking the activity in question. In this regard, the test is not whether, in carrying out the activity in question, they have done the best they could within their limited ability. At common law, in this case, Mr Hodder’s conduct in diving into the pool when he could not see the depth of the water below him, was to be judged according to the objective standard. The fact that he did not subjectively appreciate the risk of the activity he was undertaking does not lead to an attenuated standard of care in this case. Murphy JA also held that the Civil Liability Act 2002 (WA) s 5K imposed an objective test

against which the plaintiff’s conduct must be measured. As was noted above, Martin CJ strongly disagreed with respect to using an objective test in this context, at common law and under the statute, stating (at [164]): It will be apparent from the vigour with which these reasons are expressed that I instinctively recoil against the proposition that Mr Hodder’s contributory negligence should be assessed without regard to his various disabilities. I would only arrive at the conclusion that the question of contributory negligence must be addressed without regard to Mr Hodder’s disabilities if compelled to do so by prior binding authority or by the unequivocal language of s 5K of the [Civil Liability Act]. Whether I am compelled to do so is the question which I will now address. Martin CJ thoroughly reviewed all relevant common law authorities and closely analysed the civil liability provision and its intent, as a result of which his Honour concluded (at [259]): … [T]he trial judge was wrong to assess contributory negligence without regard to Mr Hodder’s disabilities. The proper approach to the question of whether Mr Hodder failed to take reasonable care for his own safety is to ask what conduct might have been expected from a reasonable person in Mr Hodder’s situation having regard to his physical disabilities, including most relevantly, his visual impairment. For the reasons I have already given, it is not necessary to have regard to any disability suffered by Mr Hodder other than his visual impairment in order to conclude that he did not fail to take reasonable care for his own safety. It is therefore unnecessary to determine whether s 5K of the [Civil Liability Act] requires the court to give consideration to the effect which his intellectual disability, or his psychological or emotional difficulties would have on the standard of conduct expected from a reasonable person suffering those disabilities as well. Martin CJ therefore held that the plaintiff’s damages should not be reduced for contributory negligence due to his physical disabilities, with the focus on his severe visual impairment. As the quotation highlights, his Honour deferred consideration of the effect of intellectual impairment, presumably because of the extra layer of complexity associated with that issue. In his Honour’s view, it did not require determination on the instant facts. [page 501] Although McLure P had held that the test for contributory negligence was objective, in her Honour’s view the plaintiff had acted reasonably. McLure P concluded (at [302]– [303]): An assessment of what a reasonable person in the appellant’s position would do depends upon making assumptions about the level of experience and familiarity that SHAC pool users, or classes of them, could reasonably be expected to have. A court would, in the absence of evidence, have little hesitation in concluding that

a reasonable adult (or indeed adolescent) raised in metropolitan Perth would or should be familiar with the risks associated with diving from blocks into a swimming pool and how to minimise those risks by the application of proper diving techniques. However, I am not persuaded that such an inference can safely be drawn when the classes of users of the SHAC facility in the Pilbara are likely to include people who would be expected to have little, if any, experience or familiarity with diving into swimming pools. That is, I am unable to conclude that all classes of users of the SHAC pool would know, or ought to know, that it was unsafe to accept the invitation presented by the diving blocks to dive into the shallow end. … I am not persuaded that the town discharged its onus of establishing that a reasonable person in the appellant’s position (but without reference to his reduced capacity for foresight and prudence) would have understood that he should not accept the town’s invitation to dive from the blocks in the manner that he did … Murphy JA disagreed with McLure P’s application of the objective test to the facts. Upholding the trial judge’s determination on appeal, Murphy JA dissented with respect to the ultimate result. He stated (at [388]–[389]): Mr Hodder also contended that the judge erred in fact in failing to find that Mr Hodder’s actions in diving from the block did not constitute a lack of care for his own safety, but resulted from the invitation to dive from the block which he was entitled to consider was safe … In my view, no error is shown. The judge found that the diving blocks constituted an invitation to dive, which was accepted. However, there was no special duty owed to Mr Hodder. Diving carries with it inherent risks, and notoriously, risks of injury to the head and neck, and thereby spinal injury. Those risks must be taken to be known by reasonable persons using the pool, whether the users of the pool were in fact locals in Port Hedland, or visitors or new residents to the area from other parts of this state such as Perth, or other parts of Australia such as Sydney or Melbourne. In the application of the objective standard, in my view, a reasonable user of the pool would have checked its depth before taking the decision to dive. … His Honour ultimately apportioned 90% to the town and 10% to Mr Hodder. The apportionment is undoubtedly at the lower end of a proper range for contributory negligence, but in my view it cannot be said to fall outside a proper exercise of the evaluative judgment required in this context.

The issue of whether or not a plaintiff’s unique mental disability should be taken into account when considering contributory negligence was considered by Basten J (Barrett JA agreeing) of the New South Wales Court of Appeal in T & X Co Pty Ltd v Chivas (2014)

67 MVR 297; [2014] NSWCA 235 (see issue, they stated, obiter (at [55]–[56]):

10.29).

Without deciding the

A second factor to be taken into account is the requirement in s 5R(2) [of the Civil Liability Act 2002 (NSW)] that the standard of care required of the plaintiff is that of

[page 502] ‘a reasonable person in the position of’ the plaintiff. In assessing the harm caused to the mother, the trial judge noted that the deceased was affected by Asperger’s syndrome. This might have raised a question as to whether the deceased’s ability to judge the behaviour of other road users was affected and, if so, whether that was a factor to be ignored in assessing contributory negligence. This in turn might have raised a question as to whether, although in assessing damages the tortfeasor must take the plaintiff with his or her personal frailties and idiosyncrasies, that is not so in the case of an assessment of contributory negligence. In Joslyn, McHugh J thought that statements … [in earlier cases] that a person should not be held to a standard of which he or she was not capable were wrong because they contradicted the ‘objective test of contributory negligence’: Joslyn at [34] and [39]. McHugh J noted an exception with respect to age in the case of a child: at [35]. These issues were not raised in the present case and it is therefore inappropriate to explore them further. To do so would require an inquiry into the extent to which s 5R is consistent with the principle stated by McHugh J in Joslyn, and the extent to which, absent s 5R, relevant disabilities of a plaintiff could be taken into account under s 9(1)(b) of the [Law Reform (Miscellaneous Provisions) Act 1965]. On one view, the ‘claimant’s share in the responsibility for the damage’ is a mandatory factor in considering a ‘just and equitable’ apportionment, but not the only factor. Section 5R affects the assessment of that factor, but does not deprive the court of the power to consider other factors relevant to the ‘just and equitable’ test. These questions will need to await consideration in another case.

Case Example Goldsmith v Bisset (No 3) (2015) 71 MVR 53; [2015] NSWSC 634 Facts: Charmayne, a nine-year-old developmentally delayed child with an intellectual disability at the lower end of the moderate range, suffered head and brain injuries in a motor accident. The defendant, driving a motor vehicle in the traffic lane, collided with the plaintiff, who, not wearing a helmet, rode her bike out of the parking lane and into the traffic lane. The defendant was negligent for failing to keep a proper lookout. Issue: Should the plaintiff’s age and intellectual disability affect the court’s assessment

of the reasonableness of her conduct in the circumstances? Was she contributorily negligent? Decision: Campbell J held that Charmayne was not contributorily negligent even though s 138(2)(d) of the Motor Accidents Compensation Act 1999 (NSW) provides that a finding of contributory negligence must be made where the injured person was, at the time of the accident, not wearing a protective helmet when legally required to do so. His Honour construed s 138(2)(d) as not applicable to minors despite the fact it does not include the qualification ‘not being a minor’, which was explicitly included in s 138(2)(b) and (c). He stated (at [118]) that the legislative purpose of s 138(2) was clear: ‘The conduct of a girl of only five will be assessed according to a standard appropriate to a child of that age.’ Because the second reading speech and explanatory memorandum did not suggest any different intention, he concluded [page 503] that the drafters had overlooked how s 138(2)(d) applied to minors; in his view, had the issue been drawn to their attention, they would have qualified the section. Citing McHale v Watson (1966) 115 CLR 199, that the relevant standard of care is ‘objective, but has subjective elements’, Campbell J considered (at [134]) whether the plaintiff ‘failed to take the reasonable care for her own safety that is to be expected from a reasonable 9 year old child having such a degree of intellectual handicap’. He held that ‘the reasonable 9-year-old’ with Charmayne’s degree of intellectual disability is likely to be as forgetful as a five-year-old. Further, she was not contributorily negligent by failing to wear a helmet as there was insufficient evidence regarding the soundness of her helmet. He also stated at [140]) that ‘having regard to the evidence about Charmayne’s difficulty in dressing herself, I am not persuaded that she could be left to her own devices in fitting the helmet’. Campbell J noted that, following Boral Bricks Pty Ltd v Cosmidis (No 2) (2014) 86 NSWLR 393 (see 10.29), the general rule that a person in control of a dangerous vehicle should attract a greater share of responsibility no longer applies. However, Campbell J stated (at [145]) that here, the child’s responsibility compared to an adult in control of a dangerous machine is likely to be attenuated: [T]he defendant’s] failure to keep a proper lookout in the circumstances involved much greater culpability, and greater causal potency as it would have been obvious to anyone who saw Charmayne that she was not wearing a protective helmet, than Charmayne’s departures from the degree of care to be expected from an ordinary or reasonable 9-year-old.

Employees and employment contexts 10.15 Although cases involving children illustrate the courts’ somewhat more indulgent treatment of some kinds of plaintiffs, they are not the only contexts in which this has taken place. For example,

in considering whether an employee has been guilty of contributory negligence where the employer has failed to provide a safe workplace or system of work, courts at common law have taken into account the fact that the employee’s conduct takes place in a situation of risk created by the employer’s negligence. Key Case McLean v Tedman (1984) 155 CLR 306; 56 ALR 359 Facts: See 3.32. Issue: Was the employee plaintiff acting unreasonably with respect to his own safety when he ran across the road, not keeping a proper lookout for traffic? Was he contributorily negligent? Decision: The High Court of Australia held, by a majority of four to one (Gibbs CJ dissenting), that the plaintiff had not been guilty of contributory negligence. Mason, Wilson, Brennan and Dawson JJ stated (at CLR 315; ALR 365–6): [page 504] The issue of contributory negligence has now to be approached on the footing that [the defendant] failed to discharge its obligation to provide a safe system, that is, to take appropriate precautions against the risk of injury arising from the motorist’s negligence and the employee’s failure to observe an oncoming vehicle as he carried out his allotted task. The question is whether that failure should be characterised as mere inattention or inadvertence or whether it amounts to negligence, there being a well recognised distinction between the two. It is accepted that in considering whether there was contributory negligence by an employee in a case in which the employer has failed to provide a safe system of work, the circumstances and conditions in which he had to do his work must be taken into account.

10.16 The distinction between ‘mere inattention or inadvertence’ on the one hand and contributory negligence (unreasonableness) on the other shows that not every failure to be careful is regarded as negligent. Sometimes the plaintiff’s failure to take care for her or his own safety is regarded as being caused by the defendant’s negligence

rather than by the plaintiff’s own fault. The next case provides a graphic example of this. Case Example Commissioner for Railways v Ruprecht (1979) 142 CLR 563; 25 ALR 481 Facts: The plaintiff was the foreman of shunting operations at the defendant’s railway yard. He had overall control over the movement of wagons around the yard. He lost both of his legs when he stepped onto a railway line in front of a moving wagon, which had been released by a fellow employee. The plaintiff did not look along the line before he stepped onto it, as he was preoccupied with his duties. Issue: Was the employee plaintiff acting unreasonably with respect to his own safety when he stepped onto the railway line without looking? Was he contributorily negligent? Decision: The High Court of Australia held, by a majority of three to two, that the plaintiff had not been contributorily negligent in the circumstances. Gibbs J (with whom Stephen J agreed) stated (at CLR 568; ALR 485): [I]n deciding whether the [plaintiff] was guilty of contributory negligence, one may consider, as part of all the circumstances, such things as inattention born of familiarity and repetition, and the man’s preoccupation with the matter in hand, with a view to deciding ‘whether any of these things caused some temporary inadvertence to danger, some lapse of attention, some taking of a risk or other departure from the highest degree of circumspection, excusable in the circumstances because not incompatible with the conduct of a prudent and reasonable man’: Sungravure Pty Ltd v Meani [(1964) 110 CLR 24] per Windeyer J at 37. In my opinion … the [plaintiff’s] inadvertence was not such as to amount to a failure to take reasonable care for his own safety. In reaching this conclusion I particularly rely on the circumstances that the employment demanded, and obtained, the [plaintiff’s] concentration upon it, and involved a risk of danger to which the plaintiff had become habituated …

[page 505] Ruprecht’s case demonstrated that an employee is not necessarily contributorily negligent if she or he inadvertently exposes herself or himself to a risk of injury. However, the case also does not establish that ‘mere inadvertence or inattention’ can never constitute contributory negligence. If the plaintiff’s inadvertence or inattention is

not attributable to something the defendant has done or to the nature of the plaintiff’s employment with the defendant, then it probably does constitute contributory negligence. 10.17 In Pollard v Baulderstone Hornibrook Engineering Pty Ltd (2008) Aust Torts Reports ¶81-949; [2008] NSWCA 99, the court highlighted the importance of the circumstances of the case. Citing Joslyn v Berryman; Wentworth Shire Council v Berryman (see 10.10, 10.13, 10.36), Waverley Council v Ferreira (2005) Aust Torts Reports ¶81-818; [2005] NSWCA 418 and Carey v Lake Macquarie City Council (see 11.27), the court held that the employee in this workplace context had not been contributorily negligent when he slipped and fell while cleaning his truck in a washing bay. The fact that he had taken a step backwards did not amount to a failure to take care with respect to his own safety; his conduct prior to his fall was not unusual. In Roche Mining Pty Ltd v Jeffs [2011] NSWCA 184 (see 3.14), Basten JA of the New South Wales Court of Appeal noted that the circumstances in which the plaintiff (respondent) found himself were unlike those of the workers in McLean and Ruprecht. His Honour stated (at [99]): [A]ll that the respondent [plaintiff] was doing was climbing a ladder. It was not a repetitive function, nor a circumstance where other matters requiring concentration diverted attention. It was a case where an experienced worker, trained and capable in his work, conscious of the risks attendant on the task being undertaken, knowing the possible consequences of a fall, not having thought that the risk warranted complaint to his supervisor or manager, working on a vehicle manufactured by a major international firm operating globally, fell.

Basten JA further noted (at [100]) that this did not affect the outcome ‘because there was no challenge to the finding that the respondent was totally without responsibility for what happened’. More recently, the difference between unreasonable care to oneself and mere inadvertence was considered in Waco Kwikform Ltd v Perigo [2014] NSWCA 140, where the respondent suffered injuries when he fell while dismantling scaffolding, from eight metres above the ground. Reversing the primary judge’s finding of no contributory negligence, Meagher JA (Beazley P and Macfarlan JA agreeing) of the New South

Wales Court of Appeal held (at [82]) that even though the task at hand was repetitive, the way in which he performed it was not reasonable and amounted to contributory negligence, especially when working at that height. He had not acted as a prudent person would have acted and ought to have taken a precaution for his safety, which involved checking the components used in this particular work process. The court held that he was 20 per cent responsible for his injuries. However, the court agreed with the primary judge (at [84]) that his failure [page 506] to connect a lanyard from his harness was not unreasonable, as it could not be hooked at all times and he had rarely worn one previously. The ‘urgency’ of the task at hand was of importance in Grills v Leighton Contractors Pty Ltd (2015) 89 NSWLR 104; [2015] NSWCA 72, where Beazley P (Barrett and Gleeson JJA agreeing) of the New South Wales Court of Appeal considered the case of a senior constable with the Police Highway Patrol who was seriously injured while riding his motorcycle. The constable, who was participating in a security operation involving a visit by the Vice President of the United States, collided with a lowered boom gate. Reversing the primary judge’s contributory negligence finding (assessed at 15 per cent), the court held that the appellant had been required to undertake an urgent task. This was not a typical case of employee inadvertence. 10.18 The following case demonstrates that an employee might not be contributorily negligent even if she or he knowingly exposes herself or himself to a risk of injury. Case Example Commissioner for Railways v Halley (1978) 20 ALR 409

Facts: The plaintiff, a trainee shunter, lost both his legs after being run over by a railway wagon during shunting operations in the defendant’s railway yard. He saw the moving railway wagon, and saw that it could not be connected to other wagons because its coupling was fixed in the wrong position. As the wagon came past him, he walked alongside it for a while, to gauge its speed, then moved around in front of the wagon, between the rails. He then tried to move the wagon’s coupling into the correct position, while walking backwards in front of the wagon. He tripped and fell, and the wagon ran over his legs. Issue: Was the employee plaintiff acting unreasonably with respect to his own safety when he acted dangerously, in these circumstances? Decision: The High Court of Australia held that the defendant had been negligent in failing to give the plaintiff proper training and instructions. It also held that the plaintiff had not been contributorily negligent. Jacobs J (with whom Gibbs J agreed) stated (at 415): [A] finding that the [plaintiff] knew or ought to have known that what he was doing was dangerous does not necessarily establish that he was guilty of a lack of reasonable care for his own safety in the circumstances of his employment. It would also need to be established by the [defendant] that the [plaintiff] knew or ought to have known that what he did, even though it was highly dangerous, was not required of him in the performance of his duties. Applying this test, Jacobs J held that the plaintiff had not been contributorily negligent, because although he knew that stepping in front of the wagon was dangerous, he did not know that he was not required to do so as part of his duties.

[page 507] Although Stephen and Aickin JJ agreed that the plaintiff had not been contributorily negligent in Halley’s case, they did not specifically agree with the test suggested by Jacobs J, quoted above. However, Jacobs J’s test was adopted by the Full Court of the Supreme Court of South Australia in Fennell v Supervision and Engineering Services Holdings Pty Ltd (1988) 47 SASR 6 and Coca-Cola Amatil (SA) Ltd v Petineris (1996) 66 SASR 577 and by Malcolm CJ and Wallace and Ipp JJ of the Full Court of the Supreme Court of Western Australia in Electric Power Transmission Pty Ltd v Orgaz (WASCFC, 3 November 1989, unreported, BC89008703). In each of these cases, the plaintiff was an employee who was injured while trying to perform an allotted

task dangerously (lifting a heavy weight in Fennell and Orgaz; by riding on the tines of a forklift truck in Petineris). Although the plaintiffs knew that what they were doing was dangerous, they were not held to be contributorily negligent, because they believed that the duties of their work required them to perform those dangerous tasks. 10.19 Additional examples of workplace conduct that may or may not constitute contributory negligence follow. Key Case Czatyrko v Edith Cowan University (2005) 214 ALR 349 Facts: The employee in this case had duties which included shifting furniture and distributing mail. On the day he injured himself, under pressure to work quickly, he and another employee were required to load about 30 boxes of books and documents onto a truck, using a hydraulic lifting platform and trolleys. After he spent some time loading the truck, he reorganised the boxes on the truck to find more space. He stepped backwards without looking, not realising the platform (which moved without warning sounds) was two-thirds of the way down and descending. He fell. Issue: Was the employee acting unreasonably with respect to his own safety when he stepped backwards without looking? Was he contributorily negligent? Decision: The High Court of Australia unanimously agreed that the employer was liable for not having devised a safe system of work (which must take into account the possibility of an employee’s inadvertence, thoughtlessness or carelessness, especially in the context of repetitive work). The court also held that the employee’s conduct did not constitute contributory negligence as he, not unreasonably, believed the platform would be behind him when he stepped backwards. The court stated (at [15], [18]): There should have been in place a system of work designed to avoid the risk that a person required to step backwards and forwards on and from a moveable platform might do so without first looking behind him. The system of work necessarily had also to take into account that the task was a repetitive one to be performed in a diminishing space. … … [T]he appellant did no doubt omit to take a simple precaution of looking to see whether the platform was raised before stepping on to it, and this omission was [page 508] a cause of his injuries. But in acting as he did, the appellant did not disobey any direction or warning from the respondent. No directions or warnings of any kind were given by the respondent in relation to the use of the platform. Furthermore,

both the appellant and … [his co-employee] were under pressure from their supervisor to complete the job promptly. The work was repetitive. In all of these circumstances, it presented a fertile field for inadvertence. The onus of proving contributory negligence lay upon the respondent. This it failed to do in this case. The appellant’s attempt to step on to the platform in the mistaken belief that it was still raised, and in an effort to finish loading the truck, was the product of nothing more than ‘mere inadvertence, inattention or misjudgment’. … His actions were neither deliberate, intentional, nor in disregard of a direction or order from the respondent.

Case Example Chandley v Roberts [2005] VSCA 273 Facts: An experienced subcontractor fell four metres from a scaffold plank, while working as a plasterer for the owner of the premises (also a builder/carpenter). There was a longstanding (30-year) system of work in place with respect to their use of scaffolding, and an assumption that ladders would be secured in a particular way. The plaintiff thought the ladder was secure, without checking this was indeed the case. This was part of their accepted and usual practice. Issue: What is meant by an objective test in the circumstances in a workplace context? Decision: The Supreme Court of Victoria, Court of Appeal applied the objective test, disregarding idiosyncrasies, as explained by McHugh J in Joslyn. Maxwell P stated (at [23]): [T]he plaintiff is held to the standard of care expected of an ordinary reasonable person engaging in the conduct that caused the plaintiff’s injury or damage. In determining whether the plaintiff failed to take reasonable care for himself, the Court is not limited to what was actually known by the particular plaintiff but must ‘take into account as a matter of course those facts and circumstances that the plaintiff could have discovered by the exercise of reasonable care’ [citing Joslyn at [37]]. Maxwell P held that taking account of the surrounding circumstances did not convert the objective test into a subjective one. Rather, he observed (at [24]), ‘those circumstances provide the factual context in which the court determines what the plaintiff ought reasonably to have done for his own protection’. The court agreed with the trial judge that, having taken into account the plaintiff’s failure to check whether the ladder was secure, this was not a failure to himself. Therefore, contributory negligence should not be found. Nettle JA also noted (at [27]) that an appeal court should be ‘slow to intervene’ in a trial judge’s assessment of contributory negligence: see 10.32.

[page 509] In Govic v Boral Australian Gypsum Ltd (2015) 47 VR 430; [2015] VSCA 130, the appellant, engaged by the respondent as a repair plasterer for 13 years, was tasked with fixing plaster work which had been damaged by others in the course of construction works. He stepped up onto and down from a plasterers’ stool 50 to 70 times a day, sometimes jumping down. He did not use the ‘Step Up’ stool supplied by the respondent. He eventually ceased work because of degenerative tendonitis in his left and right Achilles tendons. Redlich, Osborn and Kyrou JJA of the Supreme Court of Victoria, Court of Appeal held that the work practices that he had adopted were plainly risky, and assessed contributory negligence at 30 per cent. The respondent bore the greater share of responsibility as it had an overarching responsibility for the system of work. In Osborne v Downer EDI Mining Pty Ltd [2010] QSC 470, an employee fell down a hole in a mine floor at the end of a tunnel. McMeekin J, of the Supreme Court of Queensland, observed, with respect to the workplace context (at [78]): Generally speaking, the cases show that courts are not particularly demanding in their assessment of the blame to be attributed to a worker. The worker’s mistakes usually occur, and did in this case, when their attention is distracted and when they are doing their best to achieve the ends of their employer. The employer’s mistakes are taken in the comfort of the boardroom, with expert advice available as to the systems that ought to be in place, with the experience of other similar businesses to call on, and without the immediacy of decision making that confronts the worker.

Despite recounting the general tendency to be less strict when assessing the plaintiff’s standard of care in the workplace context, the court in Osborne held that the plaintiff’s conduct fell below the standard of care expected of someone in his position. He should have been on high alert, scanning the area carefully, recognising a danger that lay ahead. Finding 35 per cent contributory negligence, the court held (at [77]) that ‘[h]is failure … was a significant departure from the standard of care expected of an experienced miner. It was a significant contributing factor to the occurrence of his accident’.

The plaintiff in Pasqualotto v Pasqualotto (No 3) [2014] VSC 26 returned to work on the family-run tobacco farm, as a result of which he suffered a serious back injury during a harvest, which involved many hours of ‘heavy’ work. Although the plaintiff’s claim succeeded, he was found to be 20 per cent contributorily negligent because he had undertaken the farm work despite medical advice to not do so, due to a lower back injury he had suffered nine years previously in a car accident. In Tolhurst v Cleary Bros (Bombo) Pty Ltd [2008] NSWCA 181, Giles JA commented on s 5R of the New South Wales Civil Liability Act 2002, as well as Joslyn’s case and the workplace environment (citing McLean’s case and Pollard v Baulderstone Hornibrook Engineering Pty Ltd (see 10.17)). Caution should be used when considering statements about the effects of the Civil Liability Acts’ contributory negligence standard of care provisions when assessing scenarios that arise in employment settings. This is because workplace claims are largely excluded from being governed by the statutory interventions derived from and connected to the Ipp Panel Report. [page 510] Emergency or ‘agony of the moment’ contexts 10.20 A clear example of leniency to plaintiffs is found in what are known as ‘agony of the moment’ cases. For example, in The Bywell Castle (1879) LR 4 PD 219, there was a collision between two ships, and it was held that the plaintiff ship had not been contributorily negligent, even though it had breached the maritime ‘rules of the road’ just before the collision, because that mistake had been made ‘in the agony of the moment’ created by the defendant ship’s negligence. Case Example Shelley v Szelley [1971] SASR 430

Facts: The plaintiff was a passenger in the defendant’s car, and was dozing in the front passenger seat. One of the car’s tyres blew. The defendant took his foot off the accelerator, and waited for the car to slow down, without applying the brakes. The plaintiff woke up and saw that the car was heading off the road on the wrong side. He said to the defendant, ‘We are going right off the road’. The defendant smiled at the plaintiff without speaking. The plaintiff then grabbed the steering wheel of the car. The car ran off the road on the left hand side and overturned, injuring the plaintiff. Issue: Did the plaintiff’s conduct amount to contributory negligence, in the context of this emergency situation? Decision: The Full Court of the Supreme Court of South Australia held unanimously that the defendant had been negligent and that the plaintiff had not been contributorily negligent. Bray CJ (with whom Sangster AJ agreed on this point) stated (at 432): [I]n cases coming strictly within the Bywell Castle rule the conduct of the party acting in an emergency may be viewed with more latitude, since in such cases there is almost an element of estoppel: it is not in the mouth of those who have created the danger of the situation to be minutely critical of what is done by those whom they have by their fault involved in danger … If this is correct then the [plaintiff]’s conduct would be viewed more indulgently than that of the [defendant], once granted that the [defendant] was guilty of negligence prior to the [plaintiff] seizing the wheel, which negligence was in part at least the cause of what the [plaintiff] did.

Causation 10.21 The defendant must prove not only that the plaintiff failed to take reasonable care for her or his own safety, but also that the plaintiff’s negligence causally contributed to her or his injuries. Generally, causation in the contributory negligence context is determined by using the ordinary principles of causation that are relevant to determining the defendant’s negligence (see Chapter 4). In fact, in some instances, arguments about new intervening acts can alternatively be cast in contributory negligence (causation) terms. [page 511] 10.22 For some time, it was not clear as to whether or not the ‘last opportunity’ rule (see 10.2) had survived the enactment of the

apportionment statutes. In March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; 99 ALR 423 (see 4.7), the High Court of Australia confirmed that this common law rule had not survived the enactment of the apportionment legislation. Mason CJ (with whom Toohey and Gaudron JJ agreed) said (at CLR 512, 514; ALR 428–9): [T]he courts are no longer as constrained as they were to find a single cause for a consequence and to adopt the “effective cause” formula. These days courts readily recognise that there are concurrent and successive causes of damage on the footing that liability will be apportioned as between the wrongdoers. … [T]he end result of the apportionment legislation was to abolish not only the defence of contributory negligence but also the last opportunity rule.

Seatbelts (and helmets, where required) 10.23 In some cases the plaintiff’s negligence contributes to her or his injuries without contributing to the accident in which those injuries are suffered. A common example of this is where the plaintiff suffers injuries in a motor vehicle accident while not wearing a seatbelt. The plaintiff’s failure to wear a seatbelt does not make it any more likely that she or he will be involved in an accident, but it does increase the risk of injury if an accident occurs. In Rust v Needham (1974) 9 SASR 510, the Full Court of the Supreme Court of South Australia held that the plaintiff’s failure to wear a seatbelt did not constitute contributory negligence as it had not contributed to the accident in which the plaintiff was injured. By way of contrast, in Froom v Butcher [1976] QB 286, the English Court of Appeal held that failure to wear a seatbelt does constitute contributory negligence. Lord Denning MR said (at 292): The question is not what was the cause of the accident. It is rather what was the cause of the damage … The accident is caused by the bad driving. The damage is caused in part by the bad driving of the defendant, and in part by the failure of the plaintiff to wear a seat belt. If the plaintiff was to blame in not wearing a seat belt, the damage is in part the result of his own fault. He must bear some responsibility for the damage: and his damages fall to be reduced to such extent as the court thinks just and equitable. [Original emphasis.]

Bearing in mind the words used in the apportionment legislation it seems clear that the Froom approach is to be preferred to that used in

Rust. Although Rust’s case was initially followed in South Australia, courts in other states disagreed with it, particularly after the wearing of seatbelts was made compulsory: see, for example, Hallowell v Nominal Defendant (Queensland) [1983] 2 Qd R 266 in Queensland and Smedley v Smedley [1984] Tas R 49 in Tasmania. Even in Western Australia, where the statute provides that there is to be apportionment of liability where the plaintiff’s negligence contributed to ‘the event which caused the damage’, it has been held that a failure to wear a crash helmet or seatbelt constitutes contributory negligence, because ‘the event which caused the damage’ is the injury suffered [page 512] by the plaintiff, not the accident itself: see Motor Vehicle Insurance Trust v Wilson[1976] WAR 175; Clarke v Delacey (1990) 12 MVR 32. Examples of statutory interventions follow: •

In 1986, legislation in South Australia6 abolished the effect of Rust’s case. It provides that a failure to wear a seatbelt (or safety helmet where required) is presumed to constitute contributory negligence (which can be rebutted in a very limited way); damages shall be reduced by 25 per cent. See, for example, Carroll v Lewitzke (1991) 56 SASR 18. New South Wales legislation similarly requires a mandatory finding of contributory negligence for failure to wear a seatbelt (unless a child) or protective helmet (where required), but it does not fix a minimum percentage reduction.7 The issue of not wearing a seatbelt was considered by the High Court of Australia in the context of the South Australian statute: see 10.44.

•

The Australian Capital Territory presumes contributory negligence for injured persons over 16 years of age in seatbelt and helmet cases but leaves it to the court’s discretion to determine an appropriate reduction, based on what is ‘just and equitable having regard to the injured person’s share in the responsibility for the injury’. The presumption can be rebutted in limited circumstances;

this includes proving that the injury was less serious than it would have been if a seatbelt had been worn.8 •

In Tasmania, in a common law action, an injured person, 16 years old and above, not wearing a seatbelt, is subject to a minimum 15 per cent damages reduction. This could be higher, depending on the court’s assessment of what is just and equitable and the extent to which the proper use of the seatbelt would have lessened the injury’s severity.9

•

In other states, a reduction of 15 per cent for failure to wear a seatbelt is common, but is not required by law. For example, in Hallowell v Nominal Defendant (Queensland), the Full Court of the Supreme Court of Queensland held that, at common law, there is no standard percentage reduction for contributory negligence in seatbelt cases. The court refused to vary a reduction of 20 per cent.

Intoxication and causation 10.24 Causation issues and contributory negligence have been central to cases involving intoxication. For example, in Russell v Edwards (2006) 65 NSWLR 373; Aust Torts Reports ¶81-833; [2006] NSWCA 19, the key legal issue explored by the court was whether or not a plaintiff’s intoxication was the cause of his harm, [page 513] precluding him from recovering damages under the Civil Liability Act 2002 (NSW) s 50: see 10.46.

How Apportionment Operates 10.25 As was noted in 10.5, the longstanding legislation in every jurisdiction provides that, where the plaintiff and the defendant are both partly responsible, the plaintiff’s action in negligence does not fail altogether. Rather, there is apportionment. The court expresses the

apportionment of liability between plaintiff and defendant in percentage terms, using the following as the basis for the split: [T]he damages recoverable in respect of the wrong must be reduced to such extent as the court thinks just and equitable having regard to the claimant’s share in the responsibility for the damage.10 [See 10.6.]

10.26 At first sight, it seems that this provision requires the court to consider only the plaintiff’s conduct, because it refers only to ‘the claimant’s share in the responsibility for the damage’. In an article entitled ‘Reduction of Damages for Contributory Negligence,11 D Payne argued that the legislation confined the court to a consideration of the plaintiff’s conduct, and that the court was not entitled to consider the defendant’s conduct in determining what was a ‘just and equitable’ reduction of damages. Although this argument was persuasive and seemed consistent with the actual wording of the apportionment legislation, it was decisively rejected by the High Court of Australia in the following leading case, which describes the traditional approach that has been used for decades. Key Case Pennington v Norris (1956) 96 CLR 10 Facts: The plaintiff, a pedestrian, suffered injuries when he was run over by the defendant’s car while he was crossing the road on a dark, wet night. He alleged that his injuries had been caused by the defendant’s negligent driving. The defendant alleged that the plaintiff had been contributorily negligent in failing to keep a proper lookout as he crossed the road. Issue: How does apportionment operate? Decision: At first instance, it was held that the plaintiff had been guilty of contributory negligence, and his damages were reduced by 50 per cent under the Tasmanian [page 514] apportionment legislation. The High Court of Australia held unanimously that the plaintiff had been guilty of contributory negligence in the circumstances, but that his recovery should be reduced only by 20 per cent. Dixon CJ, Webb, Fullagar and Kitto JJ said (at 16):

What has to be done is to arrive at a ‘just and equitable’ apportionment as between the plaintiff and the defendant of the ‘responsibility’ for the damage. It seems clear that this must of necessity involve a comparison of culpability. By ‘culpability’ we do not mean moral blameworthiness but degree of departure from the standard of care of the reasonable man. … Here … the negligence of the defendant was in a high degree more culpable, more gross, than that of the plaintiff. … [I]n this case the very fact that [the plaintiff’s] conduct did not endanger the defendant or anybody else is a material consideration. The defendant’s position was entirely different.

In Doble Express Transport Pty Ltd (admin apptd) v John L Pierce Pty Ltd [2016] NSWCA 352 the New South Wales Court of Appeal compared the culpability of two truck drivers by reference to their respective departures from the standards of care of the reasonable person and the relative importance of their acts in causing the damage. The court considered that both drivers bore a high degree of culpability for the collision. One seriously departed from the standard of reasonable care by attempting a crossing from a highway in thick fog while carrying a load of diesel fuel while the other approached the intersection, in dangerous conditions, at excessive speed. Ultimately, Sackville AJA concluded (Ward JA, Hall J agreeing) (at [78]) that the turning truck driver’s degree of departure from the standard of reasonable care was a little greater than the speeding truck driver, largely because of the truck’s size and the nature of the load. Those factors created a particular danger in the difficult conditions that was more important as a cause of the damage.

Degree of negligence and causal potency 10.27 In Podrebersek v Australian Iron & Steel Pty Ltd (1985) 59 ALR 529 at 532–3, the High Court of Australia made it clear that the court should consider ‘the relative importance of the acts of the parties in causing the damage’. Therefore, the comparison that needs to be made involves a combination of: (i) the degree of negligence or departure from the standard of care expected of a reasonable person in the circumstances; and (ii) the relative causal potency of the respective failures. It can therefore be seen that the High Court in Podrebersek’s

case addressed any confusion that Pennington’s case may have produced. The comparison is not only about the extent to which the plaintiff and defendant had been negligent; it also embraces relative causal contributions to the harm. In relatively recent times, since the enactment of the civil liability provisions fueled by the Ipp Panel Report’s recommendations, there have been some departures or shifts from this approach, often but not exclusively in cases involving drivers and pedestrians in New South Wales (see 10.29). This includes, for example, ‘blameless motor accident’ scenarios. [page 515] The relevant principles were restated in Wynbergen v Hoyts Corporation Pty Ltd (1997) 149 ALR 25, where the High Court of Australia held that it is not possible under the apportionment legislation to reduce the plaintiff’s damages by 100 per cent (see below, 10.28). It held that to do so would be inconsistent with a finding that both plaintiff and defendant had, by their negligence, caused the plaintiff’s injuries. Hayne J (with whom the other members of the High Court agreed) stated (at 29): [The] apportionment legislation is predicated upon a finding that a person suffers damage as the result partly of the person’s own fault and partly of the fault of any other person or persons. No doubt the making of the apportionment which the legislation requires involves comparison of the culpability of the parties, ie, the degree to which each has departed from the standard of what is reasonable, but that is not the only element to be considered. Regard must be had to the ‘relative importance of the acts of the parties in causing the damage’ [Podrebersek at 532–3] and it is ‘the whole conduct of each negligent party in relation to the circumstances of the accident which must be subjected to comparative examination’ [Podrebersek at 533]. No doubt also, as the court said in Podrebersek [at 533] … ‘[t]he significance of the various elements involved in such an examination will vary from case to case’ and ‘the circumstances of some cases may be such that a comparison of the relative importance of the acts of the parties in causing the damage will be of little, if any, importance’. But no matter how culpable the claimant may be, if the damage results from the fault of the person who suffers the damage and the fault of another, it is not

possible to say that the damages recoverable in respect of that damage are to be not simply reduced but are to be entirely eliminated. Such an outcome cannot be justified as ‘just and equitable having regard to the claimant’s share in the responsibility for the damage’ [Law Reform (Miscellaneous Provisions) Act 1965 (NSW) s 10(1)] for it is an outcome which holds the claimant wholly responsible, not partly so. [Emphasis in original.]

10.28 The principle from Wynbergen that contributory negligence could not be assessed as 100 per cent was abolished in the Australian Capital Territory, New South Wales, Queensland and Victoria, giving effect to a recommendation of the Ipp Panel Report: see 2.13. The court now has the right to reduce a plaintiff’s damages by 100 per cent because of her or his contributory negligence, if it is just and equitable to do so, thus defeating the claim.12 Tasmania’s Act provides that damages can be reduced ‘to such extent up to 100 per cent as the court thinks just and equitable’ — not quite eliminating Wynbergen.13

Some shifts in approach 10.29 With the introduction of legislative changes, recent cases have shown a reluctance by some courts to follow the approach used in Podrebersek v Australian Iron & Steel Pty Ltd (1985) 59 ALR 529 and Pennington v Norris (1956) 96 CLR 10 in all circumstances. [page 516] ‘Blameless motor accidents’ 10.30 As you may recall, in New South Wales, Pt 1.2 of the Motor Accidents Compensation Act 1999 (NSW) permits claims in ‘blameless motor accidents’ (see 1.13). The New South Wales Court of Appeal in Axiak v Ingram (2012) 82 NSWLR 36; [2012] NSWCA 311 determined that the comparative approach articulated by the High Court of Australia in Podrebersek v Australian Iron & Steel Pty Ltd (see 10.27) regarding how to apportion liability was not relevant to claims brought under Pt 1.2. Because Pt 1.2 of the Motor Accidents Compensation Act operates on the

assumption that the defendant driver or owner was not at fault, determining degrees of fault would be nonsensical; indeed, it would be an impossible task. Ultimately, a finding of 50 per cent contributory negligence was imposed on this 14-year-old plaintiff, based on the court’s determination of how far the plaintiff departed from the standard of care that she or he is required to observe in the interests of her or his own safety. In another ‘blameless motor accident’, Davis v Swift (2014) 69 MVR 375; [2014] NSWCA 458, a pedestrian was injured when a motor vehicle ran over her right foot as she attempted to cross a highway. The driver was parked on the kerbside lane and slowly moved from the car park at the time of the accident. The pedestrian had walked into the middle of the road and realised that it was not safe to proceed further. She ran or stepped back very quickly, without looking, into the path of the respondent’s vehicle. The primary judge held that this was a ‘blameless motor accident’ and assessed the pedestrian’s contributory negligence at 100 per cent. Applying Axiak v Ingram, the New South Wales Court of Appeal agreed that this was a blameless accident. As such, because it proceeds upon the assumption that the defendant driver is not at fault, comparisons of the parties’ culpability and the causal importance of their acts are inappropriate. Meagher JA (Leeming JA agreeing) stated that the primary judge took irrelevant factors into account, such as those relating to the pedestrian’s conduct in entering the roadway, rather than focusing upon her decision to step back quickly once she was in the middle of the road. Ultimately, the majority held that 80 per cent was an appropriate contributory negligence finding, stating (at [52]): [I]n the range of possible departures from that standard of care, the appellant’s conduct is not an example of a worst possible case. … [T]he appellant [did not] consciously place herself in a position of danger or attempt to cross the road when her judgment was affected by alcohol or drugs.

Their Honours suggested (at [44]–[46]) that the approach in Axiak may need to be reconsidered in cases where there has been some event that results in the driver losing control of the vehicle or having to take evasive action that causes an accident.

In Serrao v Cornelius (No 2) [2016] NSWCA 231, the appellant was walking along an unlit road at night when he was struck from behind by a car driven by the respondent. Both were affected by alcohol. The New South Wales Court of Appeal (Sackville AJA, Leeming and Emmett JJA agreeing) determined that any reduction in damages [page 517] must be in accordance with the test in Axiak, considering how far the appellant had departed from the standard of care he was required to observe in the interests of his own safety and the impact of his intoxication. The court decided (at [70]) that it was equitable to reduce the appellant’s blameless motor accident damages by 50 per cent, as under s 138(3) of the Motor Accidents Compensation Act 1999 (NSW), this reduction is ‘just and equitable in the circumstances of the case’. Beyond ‘blameless motor accidents’ 10.31 More generally, in circumstances that go beyond those involving ‘blameless motor accidents’ in New South Wales, there has been a notable shift in the approach taken by some courts with respect to how apportionment operates. In a frequently-cited case, Boral Bricks Pty Ltd v Cosmidis (No 2) (2014) 86 NSWLR 393, the respondent delivered a tanker load of fuel to the appellant. After completing the delivery, as a pedestrian, he was hit from behind by a forklift. The majority of the Court of Appeal (Basten JA with Emmett JA agreeing) held that s 5R of the Civil Liability Act 2002 (NSW) should be interpreted consistently with the Ipp Panel Report’s underlying premise that individuals should take responsibility for their own safety. The majority held that the statute overrides the view that the party whose conduct posed the more serious risk would (necessarily) bear a greater percentage of fault. The greater harm that may be caused by a driver did not diminish a pedestrian’s responsibility for the accident (at [99]): If the plaintiff were aware, or ought to have been aware, of the presence of a large forklift operating in the area and if the forklift driver were aware, or should have

been aware, of the likely presence of pedestrians, and if each were equally careless, liability should be shared equally.

The majority observed that this was not an instance of declining to follow previous authority, as those cases pre-dated the statute. Basten JA stated (at [100]) that ‘[a] purposive approach … requires that this approach be adopted’. Ultimately, the majority reduced damages by 30 per cent, noting that the fact that a forklift could do more damage to a pedestrian was not itself a relevant consideration on these facts. McColl JA, dissenting, held this was relevant (at [71]), assessing contributory negligence at 10 per cent. Case Example T & X Co Pty Ltd v Chivas (2014) 67 MVR 297; [2014] NSWCA 235 Facts: A taxi collided with Scott Chivas, fatally injuring him. The vehicle was approaching an intersection with a green light when two young men ran in front of it, ignoring the red pedestrian light. The taxi driver did not slow down and drove into Mr Chivas when he later passed in front of the vehicle. The respondent, Mr Chivas’ mother, sued for the mental harm she suffered. Damages were reduced by 40 per cent at trial because of Mr Chivas’ contributory negligence. [page 518] Issue: When assessing contributory negligence, should the motor vehicle driver’s culpability be greater than a pedestrian because their conduct is inherently more dangerous? Decision: The majority of the New South Wales Court of Appeal (Basten JA with Barrett JA agreeing) cast doubt (at [45]–[54]) upon previous authorities that necessarily found the driver’s conduct more culpable. Basten JA commented (at [54]): The significant, if subtle, change of emphasis which arises from the enactment of the [Civil Liability Act 2002 (NSW)] raises a doubt as to the emphasis in past cases placed on the capacity of a motor vehicle to cause far greater damage, when compared with the capacity of a pedestrian to cause damage. That factor should be understood from the perspective of both the driver and the pedestrian, rather than as an independent consideration. To treat it as an independent consideration may lead to the conduct of the driver being judged against a higher standard than that of the pedestrian. Each should be equally conscious of that factor and adjust his or her behaviour accordingly: the driver by taking greater care for the pedestrian; the pedestrian by taking greater care for his or her own

safety. It appears to have been this factor, however, which led the trial judge to place a greater share of responsibility on the driver than the pedestrian. On these facts, Basten JA (Barrett JA agreeing) stated (at [57]): The weighty factor in assessing relative responsibility for the accident was the unpredictable step taken by the deceased in seeking to cross the road against a red pedestrian light and in the face of oncoming traffic. Giving due respect to the careful reasoning of the trial judge … according proper weight to that factor in the mix of the identified considerations required a far higher level of contributory negligence. I would assess contributory negligence at 75%. Beazley P dissented on this point and considered that the likely seriousness of harm of the driver’s conduct required that he should bear a higher proportion of the blame for the accident. In her Honour’s view (at [7]), the Ipp Panel Report’s recommendations were not intended to ignore the identity of the plaintiff or the nature of the relationship between the plaintiff and the defendant. After referring to case law subsequent to the introduction of the Civil Liability Act 2002 (NSW) that recognises the relevance of the harm that can be caused by a motor vehicle, she concluded that the potential harm caused by a motor vehicle was a relevant factor. Her Honour stated (at [16]): For his part, the deceased acted either with a high degree of carelessness, or made a serious error of judgment in respect of the oncoming taxi. However, the driver of the vehicle not only acted with a high degree of negligence in driving in the manner he did, the likely seriousness of the harm in the driver not taking the precaution of driving more slowly was such that the taxi driver should bear a high proportion of the blame for the accident. The court in obiter commented on the possible effect of mental impairment on contributory negligence: see 10.14.

By way of contrast to the majority in T & X Co Pty Ltd v Chivas, the court in Nominal Defendant v Ross (2014) 87 NSWLR 238 adopted a more traditional approach. Here, the respondent, who stepped from the kerb onto the street, was struck by an unidentified minibus driver at Sydney airport. He did not see the [page 519] minibus approach. The driver left the scene after checking the respondent and offering tissues for his cuts. At trial, the driver was found to be negligent and the pedestrian’s contributory negligence was

assessed at 20 per cent. Hoeben JA (Beazley P and Meagher JA agreeing) held (at [44]) that because the primary judge erred in fact finding, it was appropriate for the appeal court to exercise its discretion in assessing contributory negligence. Hoeben J cited (at [13]) relevant principles for the exercise of discretion, articulated by Basten JA in Gordon v Truong [2014] NSWCA 97. Basten JA repeated these principles in Boral Bricks v Cosmidis (No 2). They included reference to the Ipp Panel Report’s recommendation that courts refrain from holding drivers of motor vehicles more responsible than pedestrians. However, despite referencing this approach, Hoeben JA stated that other considerations are relevant. Notably, he stated that moral culpability weighs more heavily against a driver than against a pedestrian, ultimately holding the respondent pedestrian 35 per cent contributorily negligent. He stated (at [46]): While it may be said that the negligence on the part of the respondent and the driver of the minibus was of a similar kind, that is neither kept a proper lookout, other considerations are also relevant. A failure by a pedestrian to keep a proper lookout might result in injury to himself. A failure by a driver of a large vehicle, such as a minibus, might result in not only injury to himself, but serious injury or death to an innocent party. In that regard, moral culpability weighs more heavily against a driver than against a pedestrian, even though their actions may, to a similar degree, have contributed to the accident.

This echoes aspects of the rationale underlying the High Court of Australia’s approach in Pennington v Norris, in terms of the kinds of potential harm that may result from departure from relevant standards of care. However, it seems to conflict with what the High Court in Pennington also said about culpability, emphasising the fact that moral blameworthiness was not at issue. Case Example Steen v Senton (2015) 11 ACTLR 95 Facts: The respondent was injured when he was struck by a motor vehicle driven by the appellant. He crossed the road while eating a hamburger and failed to keep a proper lookout. The part of the street where the collision occurred was poorly lit. At first instance, the pedestrian-respondent’s damages were reduced by 30 per cent for contributory negligence.

Issue: Does the approach from Pennington v Norris (1956) 96 CLR 10 no longer apply to the assessment of contributory negligence in a collision between a motor vehicle and a pedestrian because of ss 5R and 5B of the Civil Liability Act 2002 (NSW)? Decision: The Master had applied the High Court of Australia decisions in Pennington and Anikin v Sierra (2004) 211 ALR 621, such that a driver has far greater capacity to cause damage than a pedestrian. The Australian Capital Territory Court of Appeal held that the Master should have applied ss 5B and 5R, which differ from [page 520] the approach in Pennington. The court discussed T & X Co Pty Ltd v Chivas (2014) 67 MVR 297, Boral Bricks Pty Ltd v Cosmidis (No 2) (2014) 86 NSWLR 393 and Gordon v Truong (2014) 66 MVR 241, stating (at [36]–[37]): [I]n … Chivas and Cosmidis, a majority held that s 5R of the [Civil Liability Act] requires that the approach taken in cases such as Pennington is no longer to be applied. In each case, the majority held that the driver and pedestrian should be equally conscious of the capacity of a motor vehicle to cause damage to a pedestrian and each should adjust his or her own behavior accordingly. In Cosmidis, the majority also held that the same result is reached when the general principles in s 5B(2) … are applied and the probability that harm would occur if care were not taken and likely seriousness of the harm is considered. The consequence is that the fact that the driver is in charge of a motor vehicle capable of causing great damage does not, of itself, mean that the driver’s culpability is relatively greater than that of the pedestrian. The dissenting judge in each of Chivas and Cosmidis took the opposite view. The reasons given by both the majority and minority judges in Chivas and Cosmidis are cogent and persuasive. The differing conclusions reflect a difference in approach to the interpretation of ss 5R and 5B … The majority in each case emphasised a purposive approach, giving effect to the legislature’s presumed intention to adopt the Ipp Report’s recommendation that motorists should not be required to keep a better lookout than pedestrians. The dissenting judge in each case placed more emphasis on the statutory language, which does not, in terms, reflect the view expressed in the Ipp Report. The Court of Appeal (at [38]) also referred to the principle that an intermediate appellate court in one jurisdiction should not depart from a decision of an intermediate appellate court in another jurisdiction unless convinced that the decision is plainly wrong. In its view, this principle was of particular importance in cases where the interpretation of uniform or very similar provisions are at issue and here, Chivas and Cosmidis cannot be considered to be plainly wrong. The Court of Appeal assessed contributory negligence at 50 per cent. Relevant factors noted by the court (at [42]) included the fact that the respondent had walked across the street from a well-lit area, the street was wide and it took some time for the respondent to cross the centre line in front of the vehicle.

In Boateng v Dharamdas (2016) 77 MVR 151; [2016] NSWCA 183, the New South Wales Court of Appeal referred to the different approaches, without deciding or providing guidance on the matter and the correctness of cases such as T & X Co Pty Ltd v Chivas and Boral Bricks Pty Ltd v Cosmidis (No 2). The court noted (at [123]) that these cases ‘doubted whether the driver of a motor vehicle has a greater responsibility to avoid harm than a pedestrian’. These cases were also discussed by the Supreme Court of Western Australia Court of Appeal in O’Connor v Insurance Commission of Western Australia (2016) 76 MVR 102; [2016] WASCA 95. Buss JA (McLure P and Mazza J agreeing) considered whether or not the principles governing apportionment of liability under s 4(1) of the Law Reform Act (Contributory Negligence and Tortfeasors’ Contribution) Act 1947 (WA), in the context of the common law of negligence, have been modified by the Civil Liability Act 2002 (WA). Ultimately, the court stated that it was not required to express a definitive opinion on the correctness of these decisions. [page 521]

Appeals 10.32 Appeal courts are meant to tread lightly when it comes to changing the trial judge’s (or jury’s) apportionment determinations. The reason for the reluctance to vary decisions on apportionment is simple. The court of first instance (or jury) has the advantage of weighing all the evidence, and is in a far better position to engage in a comparison of ‘the whole conduct of each negligent party’ than is the appeal court. In Pennington’s case, Dixon CJ, Webb, Fullagar and Kitto JJ stated (at 15–16): It is clear that the Act intends to give a very wide discretion to the judge or jury entrusted with the original task of making the apportionment. Much latitude must be allowed to the original tribunal in arriving at a judgment as to what is just and equitable. It is to be expected, therefore, that cases will be rare in which the apportionment made can be successfully challenged.

Both Pennington v Norris (see

10.26)

and Podrebersek v Australian Iron

& Steel Pty Ltd (see 10.27) have been applied, considered and cited innumerable times. Several examples where courts have canvassed whether or not to change an apportionment finding are now noted. In Asim v Penrose [2010] NSWCA 366 at [191], Tobias JA (with whom Macfarlan and Young JJA of the New South Wales Court of Appeal agreed) noted the basic proposition concerning the ‘limitations upon an appellate court interfering’ with respect to contributory negligence findings. Unwilling to interfere with the trial judge’s 10 per cent finding, the court stated (at [207]): Whether or not the plaintiff was acting instinctively, reactively or reflexively in grabbing hold of the roof rack of the taxi as it moved off, he having been unsuccessful in repeated attempts to open the front passenger door, the fact remains that he took hold of the roof rack knowing that the vehicle was moving and that he was being rejected as a fare. The act on the plaintiff’s part was … fraught with danger. It was the very antithesis of conduct of a plaintiff who had regard for his own safety and one which once the taxi commenced to move, dictated that he step back away from it. He did not do so.

In Liftronic Pty Ltd v Unver (2001) 179 ALR 321, a lift mechanic injured his back while lifting steel rails that were to be installed in an elevator shaft. The jury found for the plaintiff but reduced the damages by 60 per cent. The Court of Appeal of New South Wales found that the jury’s assessment was perverse and substituted a 20 per cent reduction. The High Court of Australia held that the Court of Appeal had erred in setting aside the jury’s apportionment of damages. Gummow and Callinan JJ stated (at [58]): In this case a properly instructed jury did exactly what the apportionment legislation required them to do, to apportion negligence between the parties on a just and equitable basis. It was not for the Court of Appeal to substitute its own opinion for that of the jury.

The High Court of Australia again concluded that the New South Wales Court of Appeal erred when it disturbed the primary judge’s determination of the negligence [page 522]

issue in Anikin v Sierra (2004) 211 ALR 621. The court highlighted the directive in Pennington v Norris to consider the respective degrees of departure from the standard of care of the reasonable person, which the trial judge had applied, reversing the Court of Appeal’s intervention, noting (at [56]) that it ‘would not disturb the apportionment for contributory negligence made by the primary judge because the gateway to appellate intervention should not be opened’. More recently, in Roche v Kigetzis (2015) 72 MVR 67; [2015] VSCA 207 at [42] Osborn JA (Kyrou JA and Garde AJA agreeing) cited Podrebersek as authority for the proposition that a finding on a question of apportionment is not lightly reviewed. The court accepted the trial judge’s conclusions on the primary facts and held (at [50]) that the trials judge’s view was reasonably open to him. In Nominal Defendant v Dowedeit [2016] NSWCA 332, the New South Wales Court of Appeal considered apportionment in the context of a ‘blameless motor accident’, adopting the approach set out in Axiak v Ingram (2012) 82 NSWLR 36; [2012] NSWCA 311 (see 10.29). Gleeson JA (Meagher and Simpson JJA agreeing) upheld the primary’s judge’s reduction of 50 per cent for contributory negligence. At [133], the court cited Basten JA in Nominal Defendant v Green (2013) 64 MVR 354 at [48] with respect to an appellate court’s restraint in reviewing the primary judge’s assessment of contributory negligence: … [W]hilst the principle of restraint is important, as Basten JA explained …, its operation may vary depending on the circumstances as to whether, for example, the decision involves a jury case or determination by a judge with particular expertise in the area. The nature of the challenge by the party seeking appellate intervention is also important. The essential question is whether a finding is outside an appropriate range …

Notwithstanding their reluctance to do so, appeal courts will in fact correct what they determine to be apportionment errors. Indeed, aside from the precedential value of Pennington’s case with respect to outlining the approach to be employed when apportioning liability, it is also a notable illustration of when an appeal court will vary the apportionment of liability that had been determined at first instance. Additional examples follow.

In Stojan (No 9) Pty Ltd v Kenway [2009] NSWCA 364, the plaintiff fell on concrete stairs leading from a car park. As she ascended the darkened stairwell (inadequately lit due to the presence of bins), she misjudged the landing. Applying s 5R of the New South Wales Civil Liability Act 2002, the lower court held that when the plaintiff let go of the handrail, exposing herself to the risk of injury in circumstances where she could not see properly, she was guilty of contributory negligence to the extent of 50 per cent. Reversing the trial judge on this point, the New South Wales Court of Appeal stated (at [147]): A finding of contributory negligence is no different to a finding of negligence and may be reviewed on appeal. While the appeal court must pay appropriate deference to the advantages the trial judge enjoyed in deciding whether or not a person was guilty of contributory negligence, it must not shirk its statutory obligation … and, where error is found, must substitute its own conclusion on the issue.

[page 523] The plaintiff in Paltidis v State Council of the Young Men’s Christian Association of Victoria Inc (2006) Aust Torts Reports ¶81-856; [2006] VSCA 122 was injured while playing beach volleyball on a sandsurfaced court at the defendant’s centre. The edge around the court was raised, using embedded car tyres to mark the boundary. The plaintiff succeeded at trial, but was found by the jury to be 70 per cent contributorily negligent. On appeal, the jury’s contributory negligence finding was changed to 25 per cent. Although the court criticised the judge’s directions to the jury regarding contributory negligence, it nevertheless made such a finding, noting that it was open to a properly instructed jury. With respect to apportionment, the Victorian Supreme Court, Court of Appeal stated (at [87]–[88]): [T]he standard of care reasonably required of [the defendant] was considerably greater than the plaintiff’s departure from the standard of care reasonably required of him. The plaintiff’s departure involved a spontaneous act in the course of play by a person essentially unfamiliar with the court. The defendant’s departure involved failure over a protracted period to take simple remedial action which was reasonably required in order to put an end to the unnecessary danger constituted by the tyres. As to the relative importance of the departure from the required standard of care of

each of the parties in causing the plaintiff’s injuries, the comparison is not of like with like. … [T]he defendant’s departure was of somewhat greater causal significance, although I acknowledge that it was the plaintiff’s spontaneous, and negligent, act which was the immediately causative event.

The appeal court in Paltidis also criticised the trial judge’s ‘confusing’ directions regarding the voluntary assumption of risk defence, as the directions used language that suggested an ‘objective’ test should be applied when the correct test is clearly subjective (see 11.1). Kelly v Bega Valley County Council (see 10.13) is another notable example of an appeal court reversing an apportionment finding, even when it is a jury determination: from 75 per cent against the plaintiff at trial to 25 per cent on appeal. The jury’s verdict was characterised as ‘perverse’. In Waterfall v Antony [2014] VSCA 44, the Victorian Supreme Court, Court of Appeal considered a case involving a collision between a motorcycle and a vehicle towing a caravan. Santamaria JA (Redlich and Whelan JJA agreeing) distinguished this case from Podrebersek noting that (at [71]) ‘in an appeal by way of rehearing, the court must make up its own mind, even though the judgment below betrays no error’. Ultimately, the appeal court (at [72]) held that the parties were equally responsible, based on their respective departures from the requisite standard of care. If necessary, appeal courts will go so far as to reverse findings with respect to the existence or absence of contributory negligence (and not simply make changes to apportionment decisions). This is illustrated by Randwick City Council v Muzic [2006] NSWCA 66 (see 11.13), where the New South Wales Court of Appeal held that the voluntary assumption of risk defence was unsustainable. The Court of Appeal reversed the trial judge’s finding that the plaintiff, who slipped on a promenade that was covered with algae, should be considered partially responsible for her injury; that is, 15 per cent contributorily negligent. Even though she had [page 524]

wandered from her home to the sea baths for over 30 years, she had not previously used this particularly hazardous walkway. The court cited Podrebersek v Australian Iron & Steel Pty Ltd to the effect that lower court decisions of this nature should not be ‘lightly reviewed’. However, despite that caution, the Court of Appeal held that such a review (and reversal) was justified on these facts. Hunt AJA (with whom Handley and Ipp JJA agreed) stated (at [54]): In the light of the judge’s finding that the plaintiff had not failed to exercise reasonable care for her own safety, and the absence of any suggestion in the evidence that the plaintiff had a proper appreciation and understanding of just how dangerous it was on this occasion to enter the water by way of the promenade (rather than a mere understanding that wet algae is slippery), I am not satisfied that the defendant has established that she was guilty of contributory negligence.

In Rockdale City Council v Simmons (2015) 70 MVR 256; [2015] NSWCA 102, the respondent suffered injuries when he was riding his bicycle through a car park and struck a closed boom gate. At trial, the council argued that the plaintiff was 100 per cent contributorily negligent because he was riding against marked traffic flow at a high speed and without a proper lookout. The primary judge, Hall J, rejected this argument, finding that the plaintiff had maintained a proper lookout. Hall J did however assess contributory negligence at 20 per cent because the respondent had failed to react in time to brake, which he found would have avoided or reduced the impact. Beazley P, McColl and Barrett JJA of the New South Wales Court of Appeal allowed the respondent’s cross-appeal on the contributory negligence finding (at [134]), stating that since the primary judge had determined that the respondent was keeping a proper lookout, did not see the closed gate and was not travelling at excess speed, there was no scope for a contributory negligence finding. The primary judge’s discussion of obvious risk is considered at 11.27. The respondent in Stenning v Sanig [2015] NSWCA 214 slipped on a path leading from the appellant’s house. The steps were constructed steps from Caesarstone, which was unsuitable for this type of purpose. Hoeben JA (Macfarlan and Gleeson JJA agreeing) held that the trial judge erred in not finding contributory negligence. Even though the respondent knew of the slippery nature of the steps and intended to

avoid treading on them, she did not do so. This failure went beyond mere inadvertence. Her contributory negligence was assessed at 15 per cent. In another slippage case, Woolworths Ltd v Grimshaw [2016] QCA 274, the Queensland Supreme Court, Court of Appeal preserved the primary judge’s finding. McMurdo P (Applegarth and Flanagan JJ agreeing) held that Woolworths had not proven the primary judge had erred in the exercise of his discretion. He had found that the respondent, who worked as a checkout operator, was not contributorily negligent when she slipped on a grape near the grape display as she headed to the lunch room. The court held that the nature of the flooring was unsatisfactory and no mats had been placed near the display. The respondent’s failure to observe the grape was mere inadvertence rather than unreasonable care with respect to her own safety. The respondent in Australia and New Zealand Banking Group Ltd v Haq [2016] NSWCA 93 had been working as a trainee at ANZ Bank. Standing up from her [page 525] desk, she caught her foot on loose wires, tripped, fell, and injured her knee. The primary judge accepted her evidence that she had not seen the loose wiring and was entitled to proceed on the assumption that the work space was suitable for that purpose. Simpson JA and Sackville AJA of the New South Wales Court of Appeal held that the appellant, the ANZ Bank, had not established a basis for overturning the primary judge’s finding that there was no contributory negligence in these circumstances. Basten JA dissented on this point, and would have found the appellant 25 per cent contributorily negligent. Similarly, the primary judge’s decision to not find contributory negligence was preserved on appeal in Townsend v O’Donnell [2016] NSWCA 288, where the respondent, a postal worker who delivered

mail on an Australia Post motorbike, was struck by the appellant who had reversed down the driveway of her home as the postal worker approached the letterbox. Sackville AJA (Beazley ACJ and McColl JA agreeing) held (at [54]) that the appellant, who had the burden of proof, ‘has not shown that the primary Judge erred in failing to find that the respondent did not keep a proper lookout or that he failed to exercise reasonable care for his own safety’. Fitzsimmons v Coles Supermarkets Australia Pty Ltd [2013] NSWCA 273 illustrates an interesting way in which a compromise determination was reached by the appeal court. In a rather typical scenario, the plaintiff injured her ankle and back after she slipped and fell on a wet floor in Coles supermarket, on the New South Wales Central Coast. The plaintiff failed at trial as she had not proven that Coles breached its duty by not taking adequate precautions to warn customers of the slippery floor. She succeeded on appeal, with Basten JA holding that the signs warning of the wet floor, placed at floor level, were inadequate. Assessing the plaintiff as 25 per cent contributorily negligent for not noticing the signs, Basten JA stated (at [21]): ‘[G]iven the nature and placement of the signs … [her contributory negligence] was not carelessness of the high order.’ Emmett JA dissented, affirming the trial judge’s finding of no liability, and highlighting the fact that the plaintiff had been hurrying, was wearing thongs, possibly having an argument with her partner and possibly not looking when she fell. Although McDougall J held that the defendant was liable, his Honour imposed a 50 per cent contributory negligence finding and stated (at [148]): ‘There were essentially, two equally effective causes of the accident …’ A compromise result of 50 per cent contributory negligence was reached, with Basten JA accepting McDougall J’s determination, noting (at [57]), ‘that figure is between the primary conclusion reached by Emmett JA and me’. The New South Wales Court of Appeal distinguished Fitzsimmons in Kellys Property Management Services Pty Ltd v Anjoshco Pty Ltd (t/as McDonalds BP Chinderah) [2016] NSWCA 341, where a McDonalds employee slipped and fell on a slippery passageway. In this case the cleaner had not placed any ‘wet floor’ signs where the walkway was

wet and slippery; a reasonable person in her position would not have realised there was a risk of harm. This was unlike Fitzsimmons, where the nature and placement of the warning signs around the perimeter of the spill area was critical to a finding of contributory negligence. [page 526] 10.33 The following case considered the possibility of a 100 per cent reduction under s 5S of the Civil Liability Act 2002 (NSW), Podrebersek v Australian Iron& Steel Pty Ltd and when an appeal court should interfere with a trial judge’s apportionment determination. Case Example Zanner v Zanner (2010) 79 NSWLR 702 Facts: See 3.6 and 4.9. Issues: Should the child’s mother be found to be 100 per cent contributorily negligent? Alternatively, should the trial judge’s apportionment be changed? Decision: Aside from canvassing causation and standard of care issues (including the relevance of inexperience and expected competence), the New South Wales Court of Appeal stated that this case appropriately embraced contributory negligence principles, as it involved two necessary conditions, both of which contributed to the harm: (i) the 11-year-old defendant’s careless driving; and (ii) his mother, the injured plaintiff, giving him permission to park the car, unaccompanied, while standing on the driveway as he tried to park it. The insurer argued that the reduction for contributory negligence should be 100 per cent, because the mother had ‘overall control of the situation and ability to direct the [child’s] conduct’ (at [84]). The court referred to the Ipp Panel Report that led to the introduction of the provision allowing for a 100 per cent reduction (at [89], [92]– [93]): The authors’ view … was that cases where it would be appropriate to reduce damages payable to a contributorily negligent plaintiff by more than 90% would be ‘very rare’. The sort of cases they had in mind were ones where the risk created by the defendant is patently obvious and could have been avoided by the exercise of reasonable care on the plaintiff’s part. … [W]hen one evaluates the justice and equity of the situation it cannot be the case that the [mother] was wholly responsible and therefore should bear full legal responsibility for the harm suffered by her.

… It cannot be said that this is one of those ‘very rare’ cases where it can legitimately be said that it is just and equitable to reduce the respondent’s damages by 100%. [Emphasis added.] Despite noting Podrebersek v Australian Iron & Steel Pty Ltd and the fact an appeal court should not readily interfere with a trial judge’s apportionment finding, Tobias JA (with whom Allsop P and Young JA agreed) changed it from 50 per cent (which was said (at [103] to be ‘both unreasonable and unjust in the circumstances’) to 80 per cent. The court stated (at [98]–[102]): With respect to the issue of culpability … namely, the degree of … [the child’s] departure from the standard of care of the reasonable man, his conduct was … a matter of inadvertence in that he permitted his foot to slip from the brake to the accelerator thus causing the vehicle to lurch forward. On the other hand, the [mother’s] departure from the standard of care to which she was subject involved, first, permitting an 11-year-old to drive the vehicle in the first place and, second, standing immediately in front of the vehicle in circumstances when [page 527] it must have been obvious to her that if the [child] lost control … she was inevitably going to be struck with some force. … [S]he unnecessarily and inappropriately placed herself in significant danger, particularly by standing in front of the vehicle. … … [I]t was simply not open to the primary judge to find that the culpability of each … was equal. The same comment applies to the causal potency of what occurred if only for the reason that causal potency relates to the relative importance of the acts of the parties in causing the damage. The factual considerations … apply equally to the determination of that question.

10.34 The approach that should be used to determine apportionment in circumstances where the plaintiff acted carelessly in two different ways was considered in Richards v Mills [2003] WASCA 97. In this case, the respondent (plaintiff), now paraplegic, had been in a motor vehicle collision on a busy freeway. He was found by the trial judge to have been 55 per cent contributorily negligent. Aside from unsuccessfully contesting the breach determination, the defendant argued that the contributory negligence finding was too low, because the plaintiff (i)

was not wearing a seatbelt; and (ii) was driving carelessly. The defendant relied on cases where not wearing seatbelts resulted in 25 per cent reductions, and argued that the judge ought to have made two separate contributory negligence findings and reductions. Citing Podrebersek v Australian Iron & Steel Pty Ltd, the Full Court noted (at [25]) that it is ‘the whole of the conduct of each negligent party in relation to the circumstances of the accident which must be subjected to comparative examination’. While not wearing a seatbelt increased the likelihood of sustaining spinal injury, on the evidence, the increase had to be assessed ‘conservatively’. There was nothing erroneous about the 55 per cent reduction. Again citing this leading High Court case, the court observed that this finding (which was substantial) was not to be lightly reviewed by an appellate court. With respect to the approach to be used, it stated (at [28]): His Honour was not engaged in a totting up exercise but was obliged to make an overall assessment of contributory negligence as a matter of discretion and judgment and of weighing all of the different considerations.

The South Australian Civil Liability Act is of interest in this context in that it prescribes, in rather elaborate terms, the exact way in which reductions must be made in cases involving ‘actual’ and statutorilyfixed contributory negligence, specifying the sequence to employ.14 10.35 One further matter worth noting, as an example of statutory responses to aspects of the law on contributory negligence, derived from the Ipp Panel Report, involves ‘wrongful death’ actions (or ‘fatal accident’ claims) brought by dependants, [page 528] where the deceased dies partly as a result of the defendant’s wrong and partly as a consequence of her or his own failure to take reasonable care. In Victoria the Wrongs Act 1958 (Vic) stipulates that the contributory negligence of the deceased cannot be used to defeat the

dependant’s action, and cannot be used to reduce the damages award.15 In the Australian Capital Territory, the relevant Act states that a reduction in damages is not possible.16 In New South Wales, by way of contrast, its Civil Liability Act recants from its previous position, which had been similar to Victoria and the Australian Capital Territory. Therefore, in New South Wales, Queensland, South Australia, Tasmania and Western Australia, the court can have regard to the contributory negligence of the deceased, and damages can be reduced, if warranted.17

Intoxication 10.36 A person’s intoxication — resulting from voluntary alcohol consumption or recreational drug use — is a factor that has always been significant when determining liability. Intoxication has sometimes affected breach considerations, and could have a role to play in deciding whether or not voluntary assumption of risk is an appropriate defence (see Chapter 11). And, of course, intoxication is relevant to contributory negligence findings if it was self-induced, contributed causally to the harm suffered and impaired the injured person’s capacity to exercise reasonable care and skill. It should further be noted at the outset that although a large number of cases that raise intoxication and contributory negligence issues arise in the motor vehicle context, there is a range of circumstances in which they occur. Legislative responses (see 10.38) are similarly wide-ranging. Joslyn v Berryman; Wentworth Shire Council v Berryman (see 10.10, 10.13 and below) is a leading case in which the High Court of Australia (McHugh, Gummow, Kirby, Hayne and Callinan JJ) explored how contributory negligence and intoxication operate at common law and under a mandated statutory presumption in a context involving a driver and guest passenger. Key Case

Joslyn v Berryman; Wentworth Shire Council v Berryman (2003) 214 CLR 552; 198 ALR 137 Facts: Berryman had been drinking at a party, also attended by Joslyn. He had been drinking from 9:00 pm until 4:00 am. Joslyn also had consumed a large amount of alcohol, and at 4:30 am was observed to be ‘quite drunk and staggering about’. [page 529] They got into Berryman’s car. As Gummow and Callinan JJ put it (at [57]), when Joslyn noticed that Berryman (then driving) was beginning to doze off, she ‘must have reproached him for doing so for he said, “Well, you drive the car then”. He stopped the vehicle and exchanged places with Ms Joslyn. She then commenced to drive it and did so to the point of the accident’. Berryman was aware that Joslyn had not driven for three years and had lost her licence because of a drink driving conviction. He sustained serious injuries when his vehicle overturned at a bend on a rural road (the council’s responsibility). Issue: How does the court determine reasonableness to oneself, objectively, when the plaintiff is intoxicated? Was the plaintiff contributorily negligent? Decision: The trial judge found Joslyn liable for driving carelessly; the council was negligent for not providing warning signs. Applying the Motor Accidents Act 1988 (NSW) s 74(2)(b) (the predecessor to the Motor Accidents Compensation Act 1999 (NSW) s 138), Berryman’s damages were reduced by 25 per cent. The section prescribes that contributory negligence must be found where: (i) the injured person … was … at the time of the motor accident, a voluntary passenger…, and (ii) the driver’s ability to drive … was impaired as a consequence of the consumption of alcohol … and the injured person … was aware, or ought to have been aware, of the impairment. The New South Wales Court of Appeal reversed the decision. Allowing the appeal, the High Court of Australia held that the passenger was guilty of contributory negligence for the purposes of s 74 and, perhaps most importantly, explored the extent to which events occurring before a passenger enters a vehicle should be considered when assessing contributory negligence (at common law and under the Act). By majority, the High Court remitted the case to the Court of Appeal, which ultimately reduced the damages by 60 per cent. Gummow and Callinan JJ concluded (at [77]–[78]) that the Court of Appeal should have considered the events in which the passenger and driver had participated in the 36 hours leading up to the accident; it should have found that faculties and capacities to observe, react, assimilate, and deal with information and to drive a motor vehicle must have been seriously impaired by alcohol consumption. Kirby J stated (at [140]) that the appellants did not need to show that Berryman was aware or ought to have been aware of the precise degree of incapacity that existed or of Joslyn’s total inability to drive. In his leading judgment, McHugh J stated (at [37]–[39]):

The issue … is not whether the passenger ought reasonably to have known of the driver’s intoxication from the facts and circumstances known to the passenger. The relevant facts and circumstances include those which a reasonable person could have known by observation, inquiry or otherwise. In cases of contributory negligence outside the field of intoxicated passengers and drivers, the courts take into account as a matter of course those facts and circumstances that the plaintiff could have discovered by the exercise of reasonable care. … [T]he relevant facts and circumstances included those which a reasonable person would have ascertained. … Hence, the issue is not whether a reasonable person in the intoxicated passenger’s condition — if there could be such a person — would realise the risk of injury in accepting the lift. It is whether an ordinary reasonable person — a sober person — would have foreseen that [page 530] accepting a lift from the intoxicated driver was exposing him or her to a risk of injury by reason of the driver’s intoxication. If a reasonable person would know that he or she was exposed to a risk of injury in accepting a lift from an intoxicated driver, an intoxicated passenger who is sober enough to enter the car voluntarily is guilty of contributory negligence. The relevant conduct is accepting a lift from a person whose driving capacity is known, or could reasonably be found, to be impaired by reason of intoxication. In other areas of contributory negligence, a plaintiff cannot escape a finding of contributory negligence by pleading ignorance of facts that a reasonable person would have known or ascertained. … Contributory negligence is independent of ‘the idiosyncrasies of the particular person whose conduct is in question’ [Glasgow Corporation v Muir [1943] AC 448 at 457; [1943] 2 All ER 44 at 48]. … Agreeing with the trial judge’s finding on the facts, McHugh J commented on the application of s 74 (at [43], [48]): The question posed by s 74 is a narrower one than that posed by the common law. Under the common law, the defective nature of the vehicle and Ms Joslyn’s lack of experience with that vehicle were factors that, combined with her alcohol consumption, made an overwhelming case of contributory negligence. In combination, they pointed to a reasonably foreseeable risk of injury to a person accepting a lift from her. The statutory test is not concerned with foreseeability of risk. It poses the simple question whether Mr Berryman knew or ought to have known that Ms Joslyn’s driving ability was impaired by the alcohol that she had consumed. … Given the fact that Ms Joslyn was certainly ‘staggering drunk’ at 4 am and the accident occurred about 8:45 am, I think that Mr Berryman ought to have been aware that Ms Joslyn’s driving ability was impaired. … A sample of blood taken

from her indicated that at about 8:45 am, she probably had a blood alcohol level of 0.138 g/100 mL. Mr Berryman was neither aware, nor ought he have been aware, of this fact. But that Ms Joslyn should have such a high reading, nearly 5 hours after Mr Berryman left the party, shows how intoxicated she must have been at 4 am. A reasonable person in Mr Berryman’s position would have been aware that she was probably still affected by alcohol when he became a passenger in the vehicle. Add to this, that Mr Berryman’s driving ability was impaired by reason of the alcohol that he had consumed, and it is an almost necessary conclusion that he ought to have been aware of a similar impairment in Ms Joslyn’s driving ability.

10.37 Not surprisingly, Joslyn’s case (and McHugh J’s judgment in particular) has been applied and cited often. Recall, for example, Town of Port Hedland v Hodder (see 10.14). Additional examples follow. Case Example Mackenzie v Nominal Defendant [2005] NSWCA 180 Facts: The plaintiff (appellant) accepted a ride as pillion passenger on a motorcycle (unregistered and uninsured but owned by the plaintiff) that was driven by the defendant (respondent), an intoxicated and inexperienced driver. Both were ‘very [page 531] much affected’ by alcohol. The plaintiff had specific knowledge of the driver’s circumstances and was held to have had full control over the events leading to the ‘inevitable’ accident. Issue: Was the plaintiff passenger acting unreasonably to himself in the circumstances? Was he contributorily negligent? Decision: The New South Wales Court of Appeal considered the reduction made for contributory negligence in a guest passenger scenario, applying Joslyn and the Motor Accidents Compensation Act 1999 (NSW) s 138. His conduct was assessed by reference to whether a reasonable, sober person would have accepted the ride. The court applied the Civil Liability Act 2002 (NSW) ss 5R, 5S (the standard of care for contributory negligence and the court’s ability to impose a 100 per cent reduction). The appellant challenged the trial judge’s 100 per cent reduction, asserting that he was so intoxicated at the time he accepted the ride, he was not capable of forming a rational judgment. Giles JA, with whom Stein AJA and Gzell J agreed, stated (at [112]) that in the circumstances, a just and equitable reduction is 80 per cent, because the appellant ‘put

Mr Brown in the driver’s seat, knowing that he was unlicensed, inexperienced and intoxicated’.

Case Example Avram v Gusakoski (2006) Aust Torts Reports ¶81-836; [2006] WASCA 16 Facts: Both the respondent (plaintiff) and appellant were intoxicated. The respondent thought that he was going to be driven home by a friend who had not been drinking. The friend sat in the driver’s seat with the engine running and the respondent got in the back seat; the appellant, described as ‘intimidating and demanding’, insisted on driving. (Previously, he had assaulted the respondent and intimidated the friend.) The respondent told his friend to not let the appellant drive, noting that the appellant was drunk and his licence had been suspended. After arguing with the appellant, the friend eventually allowed him to drive, giving the respondent little time in which to decide whether to stay in the car. Issue: Was the plaintiff passenger (respondent) acting unreasonably to himself in the circumstances? Was he contributorily negligent? Decision: Noting that the respondent had voiced his objections, had been entitled to assume his friend would drive and had a number of factors to assess quickly, the Western Australia Court of Appeal held (at [17]): [I]n the circumstances …, it could not be said that the respondent agreed to ‘accept’ the services of the inebriated appellant as driver. The appellant’s services were forced on him. There was no reasonable time in which he could decide whether or not to drive with the drunk driver, especially when he was already in the car at the time he had to make the decision. Unlike the voluntary assumption of risk defence or ‘no duty’ arguments, which depend on the knowledge and acceptance by the passenger that [page 532] she or he will be driven by an intoxicated driver, the standard of care assessment in contributory negligence depends on the foreseeability of the reasonable person, not the particular participants. Citing McHugh J’s comments in Joslyn, the court noted that this involves an assessment of what an ordinary reasonable (sober) person would have foreseen by way of exposure to risk, when accepting a lift from an intoxicated driver. Here, there was no error in the trial judge’s 30 per cent contributory negligence finding, as the appellant’s culpability far outweighed that of the respondent. Further, not wearing a securely fastened seatbelt in these circumstances did not amount

to contributory negligence: the respondent had unbuckled his belt as the accident was about to occur, so he could throw himself behind the driver’s seat. Some latitude is permitted when assessing the injured person’s conduct in the context of the ‘agony of the moment’. It was well within the trial judge’s discretion to conclude that his conduct was not ‘unreasonable’ conduct in the circumstances.

In Freudenstein v Marhop Pty Ltd [2010] NSWSC 724, the intoxicated plaintiff ‘spontaneously’ stepped out onto a hotel’s roof and fell to the ground. Access to the roof was made possible by the defendant hotel’s carelessness. Citing Joslyn v Berryman; Wentworth Shire Council v Berryman, Kirby J of the New South Wales Supreme Court noted (at [120]) that the plaintiff’s ‘impaired judgment and reduced appreciation of danger as a consequence of alcohol, are not matters which ameliorate his culpability when assessing contributory negligence’. Kirby J further observed that this objective approach, assessing the plaintiff’s actions ‘from the viewpoint of a reasonable (and sober) person’ (at [128]), is reflected in the civil liability statute. A significant reduction of 50 per cent was made even though, on these facts, the plaintiff did not put others at risk. Kirby J held (at [135]–[136]): The plaintiff’s actions … were opportunistic and probably impulsive. Unlike the plaintiff in Joslyn … the situation did not evolve over a number of hours, with many opportunities to think better of what he was doing. I accept that it probably happened fairly quickly. Having said that, there was not simply one foolish action by the plaintiff, but a succession of such actions where he moved from the corridor, to the door frame, to the roof, and then beyond. … Based upon a vague appreciation of its size, he clearly misjudged. However, he knew he was on the roof. Adopting the objective measure, his actions were clearly dangerous because of the risk of falling.

In King v Rail Corporation New South Wales [2013] NSWSC 241, Davies J found that a man who lost his leg, having been struck by a carelessly driven train, was 50 per cent contributorily negligent. Because of his intoxication, he was on the train line when he should not have been. Only some of the provisions of the Civil Liability Act 2002 (NSW) applied, because some parts of the statute do not govern motor accidents, which are defined to include those involving trains. [page 533]

Outline of some statutory responses 10.38 In several jurisdictions, much of the discretion normally available to the court when finding contributory negligence as well as apportioning the damages has been abolished or constrained by statute. This approach began several years preceding the enactment of the Civil Liability Acts, with some legislatures requiring courts to impose mandatory contributory negligence findings in motor vehicle accident contexts involving intoxication, in a manner similar to the reduction imposed for not wearing seatbelts: see 10.23. This is reflected in some of the case law extracts, provided above. For example, in New South Wales a contributory negligence finding must be made against any injured person who has been convicted of specifically enumerated intoxication-related offences, unless it is shown that the drug or alcohol did not contribute to the accident.18 The effects of intoxication on claims for benefits under statutory nofault compensation schemes are not considered here, because we are now exploring the consequences of intoxication on plaintiffs’ common law negligence actions for damages. In fact, most no-fault compensation schemes have a variety of provisions that disentitle claimants from receiving certain (if not all) types of no-fault benefits if they were intoxicated and this contributed in some way to their injuries. Indeed, the claimants’ ‘personal responsibility’ usually has deleterious consequences on their claims, even though the regimes under which they apply for compensation are not intended (in theory) to be concerned with matters of ‘fault’: see Chapter 1. Influence of the Ipp Panel Report and ‘personal responsibility’ 10.39 Statutory interventions relevant to drinking alcohol and using illicit drugs became widespread in response to the Ipp Panel’s considerations of negligence law and personal responsibility in spheres of activity well beyond driving (see 2.13). As was noted earlier with respect to standard of care determinations (see 3.69–3.70), legislatures throughout the country have directed courts to consider the relevance of intoxication when assessing a claim, albeit in different ways. A

range of approaches has been taken in response to the injured person’s (and sometimes the deceased’s) intoxication. In general terms, at one end of the spectrum is Victoria’s rather tame or moderate response to conduct involving the claimant’s intoxication: see 3.70. Under the Wrongs Act 1958 (Vic), courts in Victoria retain their discretion, as they are simply directed to consider intoxication (‘among other things’) when making breach determinations generally and more particularly in the occupiers’ liability context.19 Remarkably, Victoria has not found it necessary to reassess its approach in the light of other jurisdictions’ much more prescriptive and punitive responses and measures. [page 534] 10.40 Most jurisdictions have enacted provisions whereby contributory negligence is presumed in cases where the injured person’s intoxication contributed to her or his injury (or ‘accident’ or ‘incident’, depending on the Act’s precise wording) and contributory negligence is alleged by the defendant.20 A person is generally defined as intoxicated if the person is under the influence of alcohol or a drug to the extent that the person’s capacity to exercise appropriate care and skill is impaired. The statute in New South Wales adds, ‘whether or not taken for a medicinal purpose and whether or not lawfully taken’.21 Specific provisions governing the motor vehicle context are considered below (see 10.41). Although the precise wording differs, the breadth of the sections is generally quite wide. Several of the statutes require courts to impose contributory negligence findings on plaintiffs found to have been drinking or using drugs, when this use contributed (or ‘materially contributed’ in the Northern Territory) to the ‘accident’ (the Australian Capital Territory) or ‘incident’ (the Northern Territory). Even though the term ‘accident’ might seem to be limiting, it embraces all claims for damages for personal injury.22 ‘Incident’ is defined in the Northern Territory to mean ‘the incident, accident, circumstances or act alleged to have caused a personal injury’.23

New South Wales, Tasmania and Western Australia (essentially) state that the intoxication provisions apply if the person who suffered harm was intoxicated at the time of the act or omission that caused the ‘death, injury or damage’, or, in Queensland, if the person who suffered harm was intoxicated ‘at the time of the breach of duty’ that gave rise to the claim for damages.24 In South Australia, ‘accident’ means ‘an incident out of which personal injury arises and includes a motor accident’.25 Limited opportunities to rebut this presumption include, for example, establishing that the intoxication did not contribute to the accident (or to the breach of duty, as in Queensland) or was not selfinduced (or was involuntary).26 Some Civil Liability Acts go so far as to prescribe the size of the mandatory reduction that must be imposed for presumed contributory negligence resulting from intoxication. For example, in Queensland, South Australia and the Northern Territory, contributory negligence is presumed if the injured person was intoxicated [page 535] at the relevant time, whereby damages must be reduced by at least 25 per cent.27 A greater percentage reduction can be imposed, based on the court’s determination of what it considers appropriate in the circumstances. Other jurisdictions leave the size of the reduction to the court’s discretion. For example, while the Acts in the Australian Capital Territory and Western Australia presume contributory negligence with respect to the plaintiff’s intoxication, they do not prescribe the amount by which damages must be reduced, leaving this assessment to the court’s discretion. The Australian Capital Territory explicitly states that this is to be determined on the basis of what the court considers just and equitable having regard to the injured person’s share in the responsibility for the injury.28

An interesting middle ground was enacted in Tasmania, where the Act imposes a 25 per cent reduction in damages, which can be adjusted to a greater or lesser percentage, based on the court’s determination of what is appropriate in the circumstances of the case. The onus to decrease the reduction is on the intoxicated injured person (or deceased) who is the subject of the proceedings.29 Evidentiary issues also have been addressed explicitly in some instances, with the Northern Territory and South Australia prescribing that a blood alcohol concentration of 0.08 or more grams in 100 millilitres of blood is to be accepted as conclusive evidence that the person was intoxicated at the time of the incident or accident.30 A rather Kafkaesque provision follows in the South Australian Act: a court’s finding that a person was at or about the time of the accident so much under the influence of alcohol or a drug as to be unable to exercise effective control of a vehicle is to be accepted as conclusive evidence that the person was, at the time of the accident, so much under the influence of alcohol or a drug as to be unable to exercise effective control of the vehicle.31 Motor vehicles 10.41 A number of the provisions addressing intoxication specifically concern motor vehicle incidents. In some instances, they continue what had been enacted prior to the introduction of the more generally applicable Civil Liability Acts (derived from the Ipp Panel Report). 10.42 In Queensland and South Australia, a mandatory (minimum) reduction of 50 per cent must be imposed on drivers who are intoxicated and injured in an accident, if they have a blood alcohol concentration of 0.15 grams or more, or were ‘incapable of exercising effective control of the vehicle’.32 [page 536] 10.43

New South Wales, Queensland and South Australia enacted

provisions presuming contributory negligence in cases where the injured person, a motor vehicle passenger, relies on the care and skill of a person who was intoxicated at the time of the accident. This is the context in which Joslyn v Berryman; Wentworth Shire Council v Berryman (see 10.36) and Mackenzie v Nominal Defendant arose (see 10.37). In general terms, these provisions prescribe that an injured person (or deceased in some statutes) who is a motor vehicle passenger (above the age of 16 or not a minor in New South Wales) will have her or his damages reduced if she or he was aware, or ought reasonably to have been aware, of the intoxicated driver’s condition and the accident was caused through the negligence of the driver.33 Several Acts also include provisions specifically stating that the injured person’s reliance on the driver’s care and skill is presumed by virtue of being a passenger. The presumption can be rebutted in limited ways (which vary somewhat, statute to statute): for example, it will not apply if in the circumstances of the case the passenger could not reasonably be expected to have declined to become a passenger in the vehicle, or could not reasonably be expected to have avoided the risk, or the intoxication did not contribute to the accident.34 A case like Avram v Gusakoski (see 10.37) would likely fall within the purview of this section, rebutting the presumption, as the passenger had little time and legitimate opportunity in which to decide to not ride with the intimidating intoxicated driver. Further, by way of example, a scenario involving a child (say, 16 years of age) who feels pressured to get into a motor vehicle with her or his inebriated parents would likely come within this provision, rebutting the presumption, as she or he could not reasonably be expected to have avoided the risk as a result of parental pressure. In Queensland and South Australia, if the presumption cannot be rebutted, there is a mandatory 25 per cent reduction. If the driver had a blood alcohol concentration of 0.15 grams or more, or was ‘incapable of exercising effective control of the vehicle’, the

passenger’s damages are reduced by a significant amount: fixed at 50 per cent in South Australia, and at least 50 per cent in Queensland.35 The Queensland Supreme Court applied ss 47–49 of the Queensland Act in Hawira v Connolly [2008] QSC 004. In this typical scenario, the passenger was injured in a single vehicle accident, caused by the negligence of the driver, with whom he was driving. Both driver and passenger were held to be ‘intoxicated’ at the time of the accident, within the meaning of the Act; the passenger–claimant was over 16 years of age, he relied on the driver’s skill and care, and he ought reasonably to have been aware that the driver was intoxicated. Contributory negligence was presumed; the minimum reduction of 50 per cent, prescribed by s 49, was imposed. A further reduction of 16 per cent was made because the passenger had not been wearing a seatbelt. [page 537] Queensland’s statutory provisions were again applied in Robbins v Skouboudis (2013) 63 MVR 307; [2013] QSC 101. Both the plaintiff– passenger and defendant– driver were intoxicated at the time of the accident, in which the passenger was thrown from a motorcycle. Martin J of the Queensland Supreme Court imposed the statutorily prescribed reduction of 50 per cent for contributory negligence, because of the level of the passenger–plaintiff’s blood alcohol concentration. However, Martin J did not impose a higher reduction, after having canvassed the High Court’s approach to apportionment, outlined in Podrebersek v Australian Iron& Steel Pty Ltd (see 10.27). Martin J noted (at [57]) that Podrebersek ‘is still relevant notwithstanding the changed legislative landscape’. In New South Wales, the Act allows the court to assess the extent of the reduction for this presumed contributory negligence, stating that the damages are to be reduced by such percentage as the court considers just and equitable in the circumstances.36 It appears that the

same is true in the Australian Capital Territory, where the general provisions on reliance apply (see 10.44). The consequence of the New South Wales provision omitting the phrase ‘having regard to the claimant’s share in the responsibility for the damage’ was one of the issues considered by the court in Mackenzie v Nominal Defendant (see 10.37). The Court of Appeal noted that a determination of what is ‘just and equitable’ must be made in a principled fashion, involving a comparison between the passenger and driver in terms of degree of departure from the standard of care of the reasonable person and the relative causal potency of their failures. Reliance 10.44 More generally, beyond the guest passenger context, the Australian Capital Territory, the Northern Territory, Queensland and South Australia presume contributory negligence in ‘reliance’ cases in circumstances where one person, at least 16 years of age, relied on another person, and the capacity of the person relied upon to exercise care or skill was impaired by intoxication. If the injured person was aware or ought reasonably to have been aware that the other person’s judgment was impaired by intoxication, and the harm suffered by the plaintiff was caused through the negligence of the defendant, then contributory negligence will be presumed.37 This presumption can be rebutted in limited circumstances, similar to those noted in 10.41. Once again, some jurisdictions impose a mandatory reduction in these circumstances, whereas others leave the extent of the reduction to the court’s discretion. Queensland and the Northern Territory require damages to be reduced by 25 per cent or greater, if the court considers this appropriate in the circumstances of the case. In South Australia, the statute imposes a fixed reduction of 25 per cent. The Australian Capital Territory does not prescribe the size of the mandatory [page 538]

reduction.38 Several statutes have eliminated the voluntary assumption of risk defence in the ‘reliance’ context: to the degree it relates to the assumption of a risk arising from the intoxication of another person, it has been replaced with mandatory contributory negligence determinations.39 The following case involving a non-seatbelt-wearing guest passenger, intoxicated driver and South Australian statute was heard by the High Court of Australia. Key Case Allen v Chadwick (2015) 256 CLR 148 Facts: The respondent, Ms Chadwick, and the insured driver, Mr Allen, were in an ‘on and off’ relationship. They were travelling from their home for a weekend away. On the day of the accident, Mr Allen had begun drinking during the day and at some point, Ms Chadwick assumed responsibility for driving the car. Later that evening, Mr Allen continued drinking at the Port Victoria Hotel, where they were staying the night. Between 1:30 am and 2:00 am, Ms Chadwick drove Mr Allen and their friend, Mr Martlew, in Mr Martlew’s car. After returning from a comfort stop she found Mr Allen in the driver’s seat. It was later ascertained that the car stopped on the outskirts of Port Victoria, approximately 500 metres from the Port Victoria Hotel. She told Mr Allen not to drive but ultimately entered the car and sat in the passenger seat, failing to put on her seatbelt. Mr Allen drove erratically; the car struck a tree. Ms Chadwick was rendered paraplegic. Issues: Should contributory negligence be presumed against Ms Chadwick under the Civil Liability Act 1936 (SA) s 47 because she chose to travel in the car driven by Mr Allen when she ought to have known that he was intoxicated? Should contributory negligence be presumed under s 49 of that Act because she did not wear a seatbelt? Decision: The High Court of Australia held that s 47(2)(b) is concerned with the reasonable evaluation of the relative risks of riding with an intoxicated driver or taking an alternative course of action. This does not go so far as to require that the plaintiff be confronted with ‘no choice’ but to ride with the intoxicated driver. The court stated (at [51]) that the section contemplates the following: … an evaluation of relative risk in a given situation by the exercise of reasonable powers of observation and appreciation of one’s environment, as well as the exercise of a reasonable choice between alternative courses of action. Inputs into the evaluation contemplated by s 47(2)(b) are those facts, as they may reasonably be perceived, which bear upon the reasonable assessment of the relative risks of alternative courses of action. Those facts may include matters of objective fact personal to the plaintiff as well as aspects of the external environment. But

subjective characteristics of the plaintiff which might diminish his or her capacity to make a reasonable evaluation of relative risk in the light of those facts are immaterial to the evaluation which s 47(2)(b) contemplates. [page 539] According to the High Court of Australia, Ms Chadwick could not have been expected to have avoided the risk of driving with Mr Allen. Their Honours observed (at [59]): Reasonableness does not require constant vigilance as to the possibility of an emergency and a photographic memory of one’s surroundings. It could reasonably be expected that a reasonable person in Ms Chadwick’s position would have taken a moment to apprise herself of her geographical situation to determine whether it was reasonably safe to walk back to town and the hotel. But a reasonable person in the position of Ms Chadwick would not, by ‘taking a moment’, necessarily have appreciated that she was a relatively easy walk from the hotel. Notably, the circumstances in the case whereby Ms Chadwick felt helpless, anxious and confused were irrelevant to a reasonable evaluation of relative risk. The relevant inputs included the fact that she was a young, pregnant woman situated on a dark and unfamiliar country road that was an uncertain distance from town. The court stated (at [61]) that these ‘factors could reasonably lead to an evaluation of a real risk of harm, either from strangers or from the difficulties of walking in an unfamiliar territory in the dark’. Further, the risk of riding with Mr Allen could reasonably be regarded as lessened due to the absence of traffic at the time. Therefore, the presumption of contributory negligence was rebutted; this was an exception to the presumption. With respect to not using her seatbelt, the High Court of Australia held that contributory negligence was presumed, rejecting her argument that she fell within the exception to s 49. She was not prevented from fastening her seatbelt and she had at least two opportunities to engage it (at [66]): The question is not whether Ms Chadwick’s failure to fasten her seatbelt was an understandable, or even a reasonable, response to Mr Allen’s driving. The question is whether she was prevented by Mr Allen from fastening her seatbelt; and that question is answered against her by the trial judge’s findings of fact. Therefore, contributory negligence was assessed at 25 per cent, the fixed statutory reduction.

In Solomons v Pallier (2015) 72 MVR 365; [2015] NSWCA 266, the 16-year-old respondent accepted a lift home with the appellant, a probationary driver who was mildly intoxicated, with an estimated blood alcohol concentration of 0.07. They had been at a party together.

The appellant deliberately drove onto the edge of a roadway, by hitting a guidepost. This was intended to scare the respondent and other passengers. The car struck a culvert and rolled, injuring the respondent. Meagher JA (Simpson JA agreeing) held that the respondent failed to take reasonable care for his own safety by agreeing to accept the lift from the appellant, as the primary judge had found that he knew or ought to have known that the appellant’s driving capacity was impaired by intoxication. Macfarlan JA did not find contributory negligence on this basis as in his view (at [7]) the evidence did not show that the respondent had this knowledge. However, all three judges agreed that contributory negligence should be found because the respondent ought to have known that he was being driven by a provisional license holder who had consumed alcohol. Their Honours [page 540] held that a hypothetical ordinary, reasonable 16-year-old would not have travelled in the car. Having considered each party’s departure from the appropriate standard of care and the importance of their respective careless acts in causing the damage, the court held that it was just and equitable to reduce the respondent’s damages by 10 per cent, observing (at [92]–[93]): ‘From the perspective of the 16-year-old respondent the driver’s doing so was not an obvious or likely consequence of mild impairment, particularly given the appellant’s assurance that he was alright to drive and the absence of any other indication that he might engage in reckless or irresponsible conduct.’ Applegarth J of the Supreme Court of Queensland considered what it means to be under the influence of alcohol to the extent that the exercise of care and skill is impaired in Smith v Randall (2016) 77 MVR 402; [2016] QSC 191. Randall had been drinking the night before an accident and recorded a blood alcohol content of 0.058 per cent in a breath test. The court held that contributory negligence was presumed under s 47 of the Civil Liability Act 2003 (Qld) and he had failed to

rebut the presumption. According to Applegarth J, whether the criterion is met depends not just on a blood alcohol level, but upon all the circumstances of the case, including whether the driver is alert or tired due to other factors. These included being sleep-deprived or not and the presence or absence of caffeine. Here, the causal contribution justified a reduction greater than 25 per cent, with liability apportioned equally between the two drivers. Recall 10.45 As we noted in Chapter 3, both New South Wales and Queensland attempt to minimise any potential pro-plaintiff effect the injured person’s intoxication might have had at common law with respect to being owed a duty of care and establishing an appropriate standard of care:40 see 3.70. Civil Liability Act 2002 (NSW): a unique presumption 10.46 New South Wales strengthened the intoxication defence in a unique way. The Civil Liability Act 2002 (NSW) states, rather clumsily, that if it is established that the injured person was intoxicated (impairing her or his capacity to exercise reasonable care and skill) at the time of the act or omission causing death, injury or damage to property, the court is not to award damages unless it is satisfied the injury is likely to have occurred even if the person had not been intoxicated.41 So, for example: •

if you consumed six beers, as a result of which you cannot exercise reasonable care, and you fall down a rickety stairwell that is in disrepair, you will be denied damages (at first blush);

•

however, if you can prove, on a balance of probabilities, that it is likely your fall down the rickety stairwell would have occurred even if you had not been [page 541]

intoxicated — that is, because the stairwell is in such a disastrous state — your damages will not be denied in full; •

but, importantly, the section goes further: — if the court is satisfied that your injury is likely to have occurred even if you had not been intoxicated, your contributory negligence is presumed unless the court is satisfied that the intoxication did not contribute in any way to the cause of your injury; — if the presumption of contributory negligence applies and causation cannot be negated, damages must be reduced by 25 per cent (or by a greater amount, determined by the court as appropriate in the circumstances); — to rebut this presumption, the evidence must show that there was no causal connection of any sort between your drinking and your fall. Case Example Jackson v Lithgow City Council [2008] NSWCA 312 Facts: The injured plaintiff (appellant) was found unconscious in a park managed by the council. He had fallen over a low, unfenced retaining wall around a drain. This occurred at 3:30 am, when he took his dogs for a walk. He was intoxicated at the time. Issue: What effect does the plaintiff’s intoxication have on this claim under the Civil Liability Act 2002 (NSW)? Decision: Holding in favour of the plaintiff (appellant), the New South Wales Court of Appeal observed that although he was intoxicated at the time of the accident, the accident was likely to have occurred even if he had not been intoxicated. Therefore, s 50(3) and (4) were enlivened. Allsop P (with whom Basten JA and Grove J agreed) stated (at [103]–[105]): The relationship between sub-s 50(2) and (3) is not entirely clear, but can be seen to contrast or juxtapose the likelihood of the injury etc occurring to a nonintoxicated person and proving that intoxication played no part in the cause of the injury etc. … On all the evidence, I cannot conclude that there was no contribution of the intoxication to the fall over the wall, being the cause of the injury. The presumption in s 50(3) therefore applies. It is then necessary to consider s 50(4). This provides for a mandatory 25 per cent

allowance for contributory negligence. The allowance can be increased if the Court thinks it appropriate in all the circumstances to do so. Here, [it was] submitted that there should be a contributory negligence allowance of 50 per cent. I cannot agree. The appellant went for a walk at night with his dogs when intoxicated. I do not think that requires a court to conclude that a greater contribution than 25 per cent reduction of damages was necessary, especially as he fell over a 1.5-metre wall above a concrete drain which was unlikely to have been seen even by a sober person.

[page 542] The way in which aspects of the New South Wales Act operate in this context was considered in Jones v Dapto Leagues Club Ltd [2008] NSWCA 32, where the court held that the statutory requirement prescribed in s 50(1) had not been satisfied, because the evidence disclosed that although the plaintiff was affected by alcohol, the effect was not to such a degree that his capacity to exercise reasonable care and skill was impaired. The appeal court also held that the trial judge’s contributory negligence finding on the basis of s 5R (the standard of care) should be set aside. In its view, the evidence showed that when the claimant jokingly put his finger in an exposed light socket, he thought the power was disconnected. Similarly, in Davies v George Thomas Hotels Pty Ltd (2010) 10 DCLR (NSW) 351; [2010] NSWDC 55, although the plaintiff had been drinking alcohol (and was ‘intoxicated’ within the meaning of the Act, as he was ‘under the influence of alcohol’), his ‘ability to exercise reasonable care and skill’ was not impaired (according to the evidence). Impairment must be assessed in the context of the specific task under consideration, which, here, was not complex: going to the bathroom, with care, is not as demanding of one’s cognitive skill as, say, driving. He was alert and not visibly drunk, prior to slipping on the wet bathroom floor. Therefore, because s 50 was not enlivened, recovery was not precluded. Finally, he was not contributorily negligent under s 5R, because the ‘hazard’ he encountered was

‘unexpected’. His injury was not the result of unreasonable conduct on his part which could be said to have contributed causally to his fall and injury. The way in which causation principles operated under the New South Wales provisions to cut out the claim of a young person who was intoxicated at the time of the accident, and who subsequently sustained severe injuries, is highlighted in Russell v Edwards, which follows. Key Case Russell v Edwards (2006) 65 NSWLR 373; Aust Torts Reps ¶81–833; [2006] NSWCA 19 Facts: The New South Wales Court of Appeal applied the Civil Liability Act 2002 (NSW) s 50 to a claim by a 16-year-old, Ashley James Russell, who, with 15–20 other guests, attended a birthday party at the defendants’ home. While in the backyard, where a fire was burning for a barbecue, Russell drank two beers from an esky provided by Mr Edwards, father of the friend whose birthday he was celebrating. Later, a friend of Russell’s brought a bottle of bourbon, which the two shared. By 10:00 pm, everyone was drinking heavily, getting drunk. At around that time, Mr Edwards told the guests to go to the pool area, where they continued drinking many spirits, including bourbon. As the court held (at [7]), ‘[a]t this time the guests showed distinct signs of some intoxication. They were loud, exuberant and boisterous and were using offensive language’. Russell and the other guests began to swim, and alcohol continued to be drunk. Russell then dived into the shallow end of the pool, hitting his head on the pool bottom, severely injuring himself. Issue: What was the legal effect of the plaintiff’s intoxication on his claim, under the presumed contributory negligence sections of the New South Wales Act? [page 543] Decision: The trial judge held that the homeowners had breached their duty of care, because they had not exercised adequate control or supervision over the young men’s activities. Bearing in mind the alcohol consumption, the pool area ought to have been closed as a preventative measure. Russell conceded he was intoxicated when he dived into the pool, as he was unable to assess the water’s depth or properly exercise his judgment. The trial judge agreed with the defendants’ contention that s 50 of the Civil Liability Act exempted the defendants from liability. The trial judge did not give effect to Russell’s argument that his drinking was not self-induced (under s 50(5)), as he was fully aware of the consequences of alcohol and exercised free will in consuming it. She also determined that his drinking led directly to his inability to judge the water depth. The

requirements of s 50(1) were met, as he was intoxicated to the extent that his capacity to exercise reasonable care and skill was impaired; therefore, s 50(2) precluded the court from awarding him damages, and his claim had to fail. On appeal, Ipp JA, with whom Beazley JA and Hunt AJA agreed, stated (at [21]): In my opinion, the expression ‘self-induced’ in s 50(5) of the Act is to be equated with ‘voluntary’ and, in my view, voluntariness will not be negated by ignorance as to the quantity of intoxicating liquor required to make the individual concerned intoxicated. … [T]here is no suggestion in the evidence that Mr Russell came anywhere near the degree of intoxication that affected his capacity to act voluntarily. The Court of Appeal then focused on the crucial causation issue: what was the cause of Russell’s injury: his drinking, or the lack of supervision by Mr Edwards? Russell argued that because the lack of supervision began before his drinking, this was the act or omission that caused his injury, such that s 50(1) did not apply. However, the Court of Appeal stated that there are problems with the suggestion that the lack of supervision was the act that caused the injury, as prescribed by the ordinary meaning of s 50(1): the section requires that there be a single cause. The court noted that difficulties arise in making that determination. Having discussed the concepts of ‘proximate’, ‘direct’ and ‘effective’ cause in pre-apportionment legislation and insurance law contexts, the court stated (at [40]–[42]): In the light of the need to determine a single cause of loss … for the purposes of s 50(1), and taking account of the difficulties of finding a single cause that would otherwise be inevitable … that section must be construed as referring to ‘the act or omission that directly caused the death, injury or damage’. … ‘[D]irectly’, in this sense is to be equated with ‘proximate’. A direct (or proximate) cause in this sense is not the first, or the last or the sole cause of the loss; it is the effective or dominant or operative cause. … On this basis, the Court may determine a single cause of the death, injury or damage in accordance with principles that have long been understood, including notions of commonsense: March v E & MH Stramare Pty Ltd [(1991) 171 CLR 506; 99 ALR 423]. … [I]n the light of the findings … the direct cause of Mr Russell’s injury was his intoxication. … [H]is level of intoxication was such that he was unable to make a proper judgment concerning the depth of the water. This prevented him from seeing and detecting the bottom of the pool. His intoxication, more than anything else, caused his loss.

[page 544]

The draconian effect of the Civil Liability Act (NSW) s 50 should not go without comment, having just explored the case of Russell v Edwards. The statute precludes any recovery to 16-year-old Ashley James Russell. He bears full responsibility for what happened. He bears the full loss himself. This is inescapable under the Act (at least on the court’s interpretation of the causation provision) despite the homeowners’ breach. The homeowners (or at least the father): •

held a pool party for teenagers;

•

did not provide much by way of supervision;

•

permitted and provided alcohol;

•

did not close off the pool area;

•

encouraged the crowd to use the pool area;

•

did not stop the continuous drinking and swimming.

Yet the Act relieves the parents in this case of all responsibility. The court has no discretion to find them responsible for having created the risk of their young guests sustaining such serious harm while at their home, under their non-supervision. 10.47 The following table summarises the ways in which intoxication is treated by legislation in each state and territory. State or territory

Intoxication

Australian Injured person is intoxicated: contributory negligence presumed if intoxicated (s Capital 95(1)), unless intoxication did not contribute to the accident (s 95(2)(a)) or not Territory self-induced (s 95(2)(b)); reduction is ‘just and equitable’ amount decided by court (s 95(3)). Injured person relies on intoxicated person: if injured person is 16 years of age or older, and knew or ought to have known that the other person is intoxicated, contributory negligence presumed (s 96(1)), unless intoxication did not contribute to accident or injured person could not reasonably be expected to have avoided the risk (s 96(2)); reduction is ‘just and equitable’ amount decided by court (s 96(3)). Replaces voluntary assumption of risk (s 96(5)). Also applies in motor vehicle context (that is, it is not excluded). New South Wales

Effect on duty/standard of care: intoxication not relevant to being owed duty of care (s 49(1)(a), (b)); injured person’s intoxication does not increase or affect standard of care owed (s 49(1)(c)).

Injured person is intoxicated: denied damages if intoxicated unless death, injury or damage would have occurred even if the person was not intoxicated (s 50(2)); if it was likely to occur, contributory negligence is presumed. Minimum 25 per cent reduction (s 50(4)) unless intoxication did not contribute in any way to the cause of injury (s 50(3)) or was not self-induced (s 50(5)).

[page 545] State or territory

Intoxication

New South Wales cont’d

Motor vehicle cases: mandatory reduction in driving and reliance cases — Motor Accidents Compensation Act 1999 (NSW) s 138(2)(a), (b). Reduction is ‘just and equitable’ amount decided by the court: s 138(3).

Northern Territory

Injured person is intoxicated: contributory negligence is presumed, with minimum 25 per cent reduction (s 17) if intoxicated and respondent alleges contributory negligence (s 14(1)) unless intoxication did not ‘materially contribute’ to the incident or was involuntary (s 14(2)). Injured person relies on intoxicated person: if injured person is 16 years of age or older, and was aware or ought to have been aware that other person was intoxicated, contributory negligence presumed (s 15(1)). Minimum 25 per cent reduction (s 17), unless intoxication did not ‘materially contribute’ to incident or injured person could not reasonably be expected to have avoided risk (s 15(2)).

Queensland Effect on duty/standard of care: intoxication not relevant to being owed duty of care (s 46(1)(a), (b)); injured person’s intoxication does not increase or affect standard of care owed (s 46(1)(c)). Injured person is intoxicated: contributory negligence is presumed (s 47(2)), with minimum 25 per cent reduction (s 47(4)) if intoxicated and respondent alleges contributory negligence (s 47(1)) unless intoxication did not contribute to the breach of duty or was not self-induced (s 47(3)). If motor accident, blood alcohol level >0.15 or ‘incapable of exercising effective control’ of vehicle, contributory negligence reduces damages by minimum of 50 per cent (s 47(5)). Injured person relies on intoxicated person: if injured person is 16 years of age or older, and was aware or ought to have been aware that other person was intoxicated, contributory negligence presumed (s 48(1), (2)). Minimum 25 per cent reduction (s 48(4)), unless intoxication did not contribute to accident or injured person could not reasonably be expected to have avoided risk (s 48(3)). Replaces voluntary assumption of risk (s 48(5)). If passenger in motor accident, and reliance, and driver/ defendant’s blood alcohol level >0.15 or ‘incapable of exercising effective control’ of vehicle, contributory negligence reduces damages by at least 50 per cent (s 49). South

Injured person is intoxicated: contributory negligence presumed, with

Australia

minimum 25 per cent reduction (s 46(3)) (if intoxicated (s 46(1)) unless intoxication did not contribute to accident or was not self-induced (s 46(2)).

[page 546] State or territory South Australia cont’d

Intoxication If motor accident, and injured person is intoxicated driver, and blood alcohol level >0.15 or ‘incapable of exercising effective control’ of vehicle, contributory negligence reduces damages by 50 per cent (s 46(4)). Injured person relies on intoxicated person: if injured person is 16 years of age or older, and was aware or ought to have been aware that other person was intoxicated, contributory negligence presumed (s 47(1)). Fixed reduction of 25 per cent (s 47(3)) unless intoxication did not contribute to accident or injured person could not reasonably be expected to have avoided risk (s 47(2)). This section replaces volenti non fit injuria (s 47(6)). If passenger in motor accident, and reliance, and driver/ defendant’s blood alcohol level >0.15 or ‘incapable of exercising effective control’ of vehicle, contributory negligence reduces damages by fixed 50 per cent (s 47(4), (5)).

Tasmania Injured person is intoxicated: contributory negligence presumed (s 5(1)). Impose a 25 per cent reduction (s 5(2)) if intoxicated, unless intoxication did not contribute in any way to the cause of death or injury (s 5(1)) or was not self-induced (s 5(4)). Onus on claimant to lessen contributory negligence reduction, to below 25 per cent (s 5(3)). The reduction could be higher (s 5(2)). If under influence of a drug taken for medicinal purposes, not intoxicated if not aware of the effect of the drug (s 5(6)). Victoria

Court must consider intoxication of plaintiff in assessing breach generally (s 14G) and occupier’s liability (s 14B(4)(fa)).

Western Australia

Rebuttable presumption that injured person was contributorily negligent if intoxicated (s 5L(1)); does not apply if intoxication not self-induced (s 5L(2)); presumption can be rebutted if injured person shows her or his intoxication did not contribute in any way to the cause of the harm (s 5L(3)).

Problem 1 10.48 For several years, despite concerns expressed in the media, Australia experienced an explosion in solarium use, evident by the 500 per cent increase in solarium site listings on the internet in just one year. Desperate to become popular, 15year-old Prudence, an awkward teen, was determined to attend Derrick Danson’s new commercial venture, Sunnyside Solarium. Planning to purchase Sunnyside’s new

package deal (cheap vouchers for 20 visits, each of which was of 30 minutes duration), Prudence exclaimed, ‘I want … no … I need to be bronzed, healthy, hot— so I can be really really popular, just like all the other kids at Aspirationville High’. [page 547] Solariums emit five times the UV radiation as that which comes from the midday sun. The voluntary code of standards that governs the solarium industry suggests that a tanner should not tan for more than 30 minutes at a time and not tan more often than once every two days. These suggested limits were mentioned to all new customers, including Prudence, at their initial visits. Like many other new customers, Prudence became somewhat nervous as she was about to sign up for Sunnyside’s deal (despite her desperation to become popular). Noticing her anxiety, Derrick suggested to Prudence that she check out the refreshments in the fridge in his waiting area. Prudence was immediately drawn to the wide variety of exotic looking alcopops found in Derrick’s fridge. Prudence thought, ‘A couple of those would certainly help me relax while I tan’. Derrick sold Prudence a few bottles of ‘South Pacific Shakers’ — an exotic, brightly coloured, fruity, sugary mixture of rum, vodka and lemonade (about 5 per cent alcohol), made by Daisy Bay Bottling Pty Ltd. As Prudence had suspected, a couple of Shakers certainly made her enjoy her time tanning. Feeling somewhat faint, Prudence fell asleep while tanning, overstaying her planned visit by several hours. Despite waking up with a slight hangover, Prudence left Sunnyside that evening feeling terribly pleased as she admired herself in a full-length mirror to see how beautifully her skin glowed. It wasn’t long before Prudence purchased a large number of additional tanning vouchers, as she returned to Sunnyside and followed the exact same routine every day for the next six months. When Prudence first attended Sunnyside Solarium, she had a noticeable, albeit small, mole on her upper arm. Over the period in which she tanned at Sunnyside, the mole increased substantially in size. Although she was reluctant to do so, she finally went to see Doctor Diligent, who diagnosed Prudence with skin cancer. She had a melanoma on her arm; the cancer had spread to her lymph nodes. Prudence brought an action in negligence against Derrick Danson’s Sunnyside Solarium. The trial judge found in Prudence’s favour, but reduced her damages award by 80 per cent for contributory negligence. The case is now on appeal. Advise Sunnyside Solarium (and Derrick Danson) and Prudence about whether or not Prudence was contributorily negligent and, if she was, what the appropriate apportionment of liability should be. For the purpose of this discussion, you may treat Sunnyside Solarium and Derrick Danson as one and the same. Revisit this problem after you have considered the material in Chapter 11, to explore the kinds of additional arguments the parties could make. Note that in this chapter’s discussion, we are commencing with Sunnyside Solarium’s and Derrick’s defensive arguments.

Discussion Arguments for Sunnyside Solarium and Derrick Danson 10.49 Prudence failed to take reasonable care for her own safety in two different ways: (i) by overstaying her visits to the solarium and (ii) by drinking alcohol while [page 548] doing so. Sunnyside Solarium and Derrick would begin by noting that just because Prudence is a child, this does not prevent the court from reducing her damages for contributory negligence. In Kelly v Bega Valley County Council, the Court of Appeal of New South Wales held that a child could be found to be contributorily negligent. In that case, the court stated that the conduct of a child should be measured against the conduct that could reasonably be expected of a child of the same age. This was also the case in Lennon v Gympie Hotel and Verryt v Schoupp: youthfulness per se is not necessarily an impediment to a contributory negligence finding. Here, Sunnyside would argue that a reasonably prudent 15-year-old child should have known better than to overstay visits to a solarium. Perhaps more convincingly, it would argue that she should not have drunk alcohol, especially when attending tanning sessions where one would be feeling weaker and drowsier than would ordinarily be the case. It is reasonable to expect that a child of that age would not do as she did: stay much longer than recommended and drink alcohol while tanning, such that she might fall asleep and overstay her visit. Indeed, she followed this unhealthy routine habitually, every day, clearly acting unreasonably towards herself. Moreover, despite being a child, she was obviously aware of her skin condition and should have been wary about attending a solarium in the first place. While it is conceded that at common law the standard expected of a child is a lower one, when compared to an adult, Prudence’s conduct was, in fact, that much more unreasonable than what could be expected at that lowered level. As McHugh J noted in Joslyn v Berryman; Wentworth Shire Council v Berryman, this is sometimes considered an exception to the principle that an objective standard should be used, in that the standard of care is tailored to the age of the child. Regardless of whether this is characterised as a true exception to an objective standard or a mere modification of a still-existing objective measurement, Prudence’s conduct has to be assessed against the standard of care expected of an ordinary child of the same age. Such a child should know not to spend undue time under ultraviolet light, in contravention of what is recommended by the operators of the solarium, let alone do so when one has a mole. As was the case with respect to the young plaintiff in Lennon v Gympie, Prudence did not take care with respect to her own safety and what might reasonably be expected of an ordinary child of a similar age. If Aspirationville is in the Australian Capital Territory or the Northern Territory, the court must apply this common law position regarding Prudence’s age. If, however, it is

located in any of the six states, the Civil Liability Acts impose a standard of care on Prudence which is that of the reasonable person in her position, based on what she knew or ought to have known. Therefore, Sunnyside may attempt to argue that this does indeed affect Prudence, in that more is required of her; no allowance should be made for her age. Citing Consolidated Broken Hill Ltd v Edwards, Sunnyside would note how the genesis of the statutory change, the Ipp Panel Report’s reforms, highlighted the fundamental requirement that people should take responsibility for their own lives and safety. This is the purpose of the statutory changes. That said, Sunnyside should acknowledge that Prudence will no doubt argue that even the statutory provisions incorporate the approach used in McHale v Watson (with a child defendant), such that a modification must be made. [page 549] The defendants could also note that in instances where contributory negligence has not been found against a child, for example, in a case such as Goldsmith v Bisset, this was not because it was not possible to do so, but only because contributory negligence could not be proven on the specific facts. Goldsmith applied what the court described as the objective standard (with subjective elements) to that child, who also had an intellectual impairment. Ultimately, whether or not the standard of care expected of Prudence to herself with respect to her own safety is modified, she has fallen below that standard, by virtue of her undeniably careless conduct and disregard for her own safety. While she may not be an adult, she is not eight years old either. She acted below what one would expect of a 15-year-old with that cohort’s capacity for understanding risk. This is similar to Bell J’s conclusion in Russell v Rail Infrastructure Corporation, where her Honour held that a large reduction for contributory negligence was warranted in that case, despite the plaintiff’s intellectual disability. In fact, this novel modification, decided under common law principles, was not justified, as the court veered too far away from an objective measure when it gave recognition to what could indeed be characterised as an idiosyncrasy. This is indeed the view of the majority in Town of Port Hedland v Hodder, in its reasoning with respect to physical as well as intellectual disabilities. Aside from Prudence’s carelessness towards herself by tanning for inordinate periods of time in order to become popular (especially when she had a suspicious-looking mole), the fact that she drank alcohol while tanning also makes her contributorily negligent. The actual legal effect of her intoxication will depend on where Aspirationville is located. Sunnyside will concede that Prudence’s intoxication will have the least effect if Aspirationville is in Victoria, in that this factor will already have been taken into account in determining the standard of care owed to her, in accordance with the Wrongs Act 1958 (Vic) s 14G. In New South Wales and Queensland, Prudence’s intoxication is not relevant to deciding if a duty is owed to her and does not of itself increase or otherwise affect the standard of care. In the Australian Capital Territory, New South Wales, the Northern Territory, Queensland, South Australia, Tasmania and Western Australia, if it is proven that Prudence was intoxicated (at the required level), contributory negligence will be presumed. It is clear

that she meets the (general) definition of being intoxicated: her conduct shows that she was under the influence of alcohol to the extent that her capacity to exercise appropriate care and skill was impaired. This is unlike Jones v Dapto Leagues Club Ltd and Davies v George Thomas Hotels Pty Ltd, where both plaintiffs had consumed alcohol, but not to such degrees that their respective reasoning capacities were impaired. As the court in Smith v Randall observed with respect to the Queensland statute, all the circumstances must be taken into account when making this assessment. While Sunnyside may have a little more difficulty showing Prudence’s intoxication contributed (the Australian Capital Territory, Queensland, South Australia, Tasmania and Western Australia) or materially contributed (the Northern Territory) to her cancer, this is nevertheless satisfied. Drinking alcopops while tanning clearly impaired her judgment with respect to taking care for her own wellbeing. It made her sleepy and [page 550] faint, leading to tanning sessions that were unsafe and far too long in duration. It could also be argued that Prudence developed a dependency on the alcopops and this led to her subsequent careless routine, which she repeated over many months. While some statutes speak of a contribution to the ‘accident’ (the Australian Capital Territory and South Australia), others use the phrase ‘incident’ (the Northern Territory). In the former instance, in the Australian Capital Territory, this addresses all claims for damages for personal injury, and in South Australia an accident is connected to an incident. The Northern Territory defines incident widely to mean ‘the incident, accident, circumstances or act alleged to have caused a personal injury’. New South Wales, Tasmania and Western Australia essentially connect the intoxication provisions to the act or omission that caused the injury or damage, and in Queensland the provisions apply if the person who suffered harm, Prudence, was intoxicated at the time of the breach of duty giving rise to her claim for damages. Assuming the statutory provisions related to intoxication apply, which it is conceded may be difficult and will depend on how a breach by Sunnyside is viewed (for example, whether it is a continuing breach or not), Prudence’s damages will be automatically reduced by 25 per cent in the Northern Territory, Queensland, South Australia and Tasmania. In Tasmania, the reduction can be higher or lower depending on what the court determines to be appropriate in the circumstances of the case. Sunnyside will urge that this should be higher than 25 per cent, as the degree of Prudence’s failure to herself by drinking and the causal potency of this careless conduct is so serious that it would be appropriate for the court to impose a sizeable reduction if she were awarded damages. If Aspirationville is in the Australian Capital Territory or Western Australia, the court must reduce her damages to the extent it considers ‘just and equitable’, having regard to her share in the responsibility for the injury (although the Western Australian Act does not provide this explicit guidance, this appears to be its intent). In Sunnyside’s view, the reduction should be very large, based on the significant way in which Prudence’s own behaviour, drinking the alcopops, led to her harm. Her lack of concern for her own

wellbeing is exactly what was of concern to the Ipp Panel, which resulted in the enactment of the Civil Liability Acts and the specific provisions relevant to intoxication (noted in Consolidated Broken Hill Ltd v Edwards). If Aspirationville is in New South Wales, in accordance with the Civil Liability Act 2002 (NSW) s 50(1), (2), Prudence should be denied all damages as her intoxication impaired her capacity to exercise reasonable care and skill, at the time of the breach (which could be alleged as continuing). Prudence cannot convincingly argue that her harm would have occurred even if she had not been intoxicated (unlike Jackson v Lithgow City Council), as there is no doubt that her drunkenness was intimately connected causally to her continued misuse of the tanning facility. She had lost all regard for her own wellbeing and safety, in a manner similar to the plaintiff in Russell v Edwards. Because her behaviour to herself was the direct (or proximate) cause of her harm, she should be precluded from recovering damages under the New South Wales statute (as in Russell). The overall size of the reduction of any damages award as a result of Prudence’s contributory negligence should be very large, based on what the High Court of [page 551] Australia stated in the leading case, Podrebersek v Australian Iron & Steel Pty Ltd, to the effect that courts should compare the whole conduct of each negligent party in relation to the circumstances of the accident and the ‘relative importance of the acts of the parties in causing the damage’. Wynbergen v Hoyts Corporation Pty Ltd is to similar effect. Here, Prudence attended a tanning centre when she had a mole (which could quite conceivably have been pre-cancerous); she abused the time spent at the centre; and she was intoxicated while undergoing her sessions. Therefore, aside from any mandatory reduction that must be imposed for intoxication in some jurisdictions, the whole of her carelessness to herself warrants a significant reduction, based on a comparison of her culpability with that of Sunnyside Solarium and Derrick. It would be appropriate for the court to favour Sunnyside when apportioning responsibility between Sunnyside and Prudence. The court should take into consideration the fact that Sunnyside had an expectation that those in attendance would care for themselves, and heed the warnings given by the venue operator. Prudence’s failure to leave the tanning sessions after 30 minutes and resist daily attendance were important causes of her harm and were clearly her responsibility. If Aspirationville is in South Australia, the court must have regard to the process (or sequence) that must be used to impose a reduction for contributory negligence when there is more than one act of unreasonableness by the plaintiff, and where one of the acts involves presumed contributory negligence and a mandatory reduction. In this case, there is no reason to depart from the traditional approach used to assess contributory negligence on a comparative culpability basis, as in Pennington v Norris and as outlined above in Podrebersek v Australian Iron & Steel Pty Ltd. This scenario is quite unlike T & X Co Pty Ltd v Chivas, Steen v Senton and Boral Bricks v Cosmidis (No 2), which involved the interpretation of the Civil Liability Act 2002 (NSW) in the context of pedestrian-drivers (and forklift, in Boral Bricks). Further, cases such as Boateng v

Dharamdas and O’Connor v Insurance Commission of Western Australia note the shift in approach but do not necessarily endorse it. In any event, even if the new approach is used here, it favours this defendant as it allows for a greater focus on the plaintiff’s personal responsibility. Here, Prudence’s conduct made her culpable and responsible for her own harm. Finally, the court should be reluctant to substitute its own apportionment of liability for the apportionment decided upon by the fact finder. As the High Court of Australia expressed in Podrebersek v Australian Iron & Steel Pty Ltd, applied in many other authorities, such as Richards v Mills and Roche v Kigetzis, the fact finder’s decision should not be lightly reviewed. In Pennington v Norris, the High Court held that the jury or trial judge must be given a great degree of latitude in determining a just and equitable reduction of damages as required by the apportionment legislation. In Liftronic Pty Ltd v Unver, the High Court stated that it is not the role of an appellate court to substitute its own apportionment for that of the original tribunal. The court in Asim v Penrose acknowledged the ‘limitations’ placed upon appeal courts when considering contributory negligence findings. An interference with that finding and the size of a reduction should only occur where there is an error, as in a case like Randwick City Council v Muzic. It is however acknowledged that in Waterfall v Antony [page 552] the court stated that in an appeal by way of rehearing, the court has to make up its own mind, even if there is no error in the lower court finding. No error occurred here. The trial judge correctly made a substantial contributory negligence finding. Prudence’s act of overstaying her tanning visits when she had a mole, attending Sunnyside too frequently and drinking alcohol to such a degree that she was intoxicated, whereby she could not exercise proper judgment (leading to overstaying her visits) was serious. The appeal court should not interfere with the trial judge’s reduction of Prudence’s damages by 80 per cent. All these were significant contributing causes of her harm and were grave departures from the standard of care she owed to herself. Arguments for Prudence 10.50 Prudence will argue that her tanning and drinking alcopops did not constitute contributory negligence. Under all states’ and territories’ apportionment statutes, a court may only reduce damages for contributory negligence where the plaintiff’s injury results in part from the plaintiff’s failure to take reasonable care to herself. The suggestion that (i) spending too much time tanning (when allowed to do so by the venue operator) and (ii) drinking alcopops while tanning (when they are sold by the venue operator) amounts to a failure to take care for one’s own safety is highly questionable and should not be sustained. This is especially so, considering Prudence’s age. Prudence will argue that she should not be found contributorily negligent because she is only a 15-year-old child. In Kelly v Bega Valley County Council, the Court of Appeal of New South Wales stated that the conduct of a child plaintiff should be measured against the hypothetical conduct of a child of the same age. As McHugh J stated in Joslyn v

Berryman; Wentworth Shire Council v Berryman, this could be characterised as an exception to the notion that an objective standard is used, in that the standard of care is tailored to the age of the child. This has been applied in Doubleday v Kelly and cases such as Lennon v Gympie Hotel, Verryt v Schoupp and Goldsmith v Bisset (No 3). It also was cited with approval by Bell J in Russell v Rail Infrastructure Corporation, a case involving an intellectually disabled plaintiff. Town of Port Hedland v Hodder also noted this modification for children is well accepted, unlike the case of an intellectually impaired or physically disabled plaintiff. The standard of care can still be viewed as objective. As was the case in these authorities, this test has merely been modified to take into account Prudence’s age, so that her conduct is (fairly) measured against an appropriate cohort (as is the case when assessing a defendant child’s conduct). Because of her young age and lack of capacity to assess risk in a manner similar to an adult, this lower standard of care must be applied. This is similar to the view expressed by the court in Verryt v Schoupp, where a 12-year-old boy was said to be unlikely to perceive the real risk of ‘skitching’ (although a modest 10 per cent reduction for contributory negligence was imposed). Similarly, here, it would be unreasonable to expect a 15-year-old child to understand the risks to her health and wellbeing as a result of tanning for a long time, and doing so frequently. This is especially so when Sunnyside’s employees [page 553] (and Derrick) did nothing to stop her from tanning for hours at a time. They should have asked her to leave. Moreover, Sunnyside (and Derrick) did nothing to restrict Prudence’s admission to the solarium, day after day for many months, despite the industry’s code, which Sunnyside violated. It is conceded that a breach to oneself can, in theory, be found even with the imposition of a modified and lowered standard of care. This occurred in cases such as Verryt v Schoupp, Lennon v Gympie Motel and Kelly v Bega Valley County Council. However, on the instant facts, Prudence would strongly assert that she was not contributorily negligent when her conduct is compared to other children of a similar age; her conduct was quite reasonable. An ordinary child of the same age would not have acted any differently, especially when body image issues are so prevalent among young people, who are subject to many pressures to fit in and over which they have little control. Children of Prudence’s age should not be expected to heed vague warnings about time spent tanning in a solarium, with its ultraviolet radiation. Further, a child of Prudence’s age should not be expected to recognise dangers associated with moles. If anything, one would expect a responsible venue operator to screen patrons properly so that anyone potentially at risk of harm would not be permitted to use the solarium. If Aspirationville is in the Australian Capital Territory or the Northern Territory, the court must apply this common law position regarding the effects of Prudence’s age on the appropriate standard of care. If Aspirationville is located in any of the six states, she could arguably have a little more difficulty contending that the standard should be modified because of her age. Under those states’ Civil Liability Acts, the standard of

care imposed on Prudence in the contributory negligence context is that of the reasonable person in her position, based on what she knew or ought to have known. On the basis of the Civil Liability Acts, Sunnyside and Derrick may argue that no modification should be employed; therefore, Prudence should have acted like an adult with respect to her care to herself. Prudence, however, would contend, convincingly, that even under the statutory provisions, the McHale v Watson approach should be incorporated, which requires an adjustment for being a child. In McHale, a modification was allowed with respect to assessing the reasonableness of a child defendant’s behaviour. The same adjustment should be applied with respect to children plaintiffs, even under the Civil Liability Acts’ provisions. A child does not have the same capacity for understanding risk as does an adult, so a concession must be made when assessing the child’s conduct as reasonable or not. Therefore, because of her age, the court should not reduce Prudence’s damages award for contributory negligence. This approach was followed in Doubleday v Kelly, decided under the Civil Liability Act 2002 (NSW). Prudence also will have to address arguments made by Sunnyside and Derrick that she was contributorily negligent because she drank alcopops while tanning. The jurisdiction in which Aspirationville is located will be critical to this discussion, as different states’ and territories’ statutes yield varying responses. Prudence will be most fortunate (in a legal sense) if the circumstances of her claim occurred in [page 554] Victoria, governed by Victorian legislation. Under the Victorian Act, her drinking will be a consideration in the court’s assessment of the defendants’ standard of care, thus leaving the effect of her alcohol consumption to the court’s discretion: Wrongs Act 1958 (Vic) s 14G. By considering her alcohol consumption when assessing Sunnyside’s breach, it will not, as in the case elsewhere, compel a presumed contributory negligence finding. It also would not be relevant in duty of care holdings or standard of care determinations in New South Wales and Queensland, although it is considered in other significant ways in those states. By way of contrast with Victoria, the fact that Prudence drank alcopops would be of great concern, legally, in the Australian Capital Territory, New South Wales, the Northern Territory, Queensland, South Australia, Tasmania and Western Australia. In those jurisdictions, contributory negligence is presumed if Prudence is proven to have been intoxicated. Therefore, she would first argue that her condition, drinking alcopops, did not meet the statutory definitions of being intoxicated (described as follows in general terms): she would argue that on the facts she was not under the influence of alcohol to the extent that her capacity to exercise appropriate care and skill was impaired. She may have been sleepy, but that could be attributed to the ultraviolet rays to which she was exposed. Moreover, she was not impaired in the manner required by the Acts. This is not unlike what was argued successfully, on the facts, in Jones v Dapto Leagues Club Ltd and Davies v George Thomas Hotels Pty Ltd. As the court in Smith v Randall noted

when interpreting and applying the Queensland statute, all the circumstance of the case must be considered to determine if the definitional criteria have been met. Even if Prudence is found to be intoxicated, which seems unlikely on the evidence having regard to the requisite impaired capacity, she can rebut its purported causal connection to her harm. She should argue that drinking did not contribute (the Australian Capital Territory, Queensland, South Australia, Tasmania, Western Australia) or materially contribute (the Northern Territory) to her cancer. Prudence would maintain that the tanning machine caused her cancer, not the alcopops. Prudence may also argue that the provisions in the Australian Capital Territory do not apply as they presume contributory negligence from intoxication where it contributes to the ‘accident’, which seems inapt when applied to the present facts. However, it is conceded that the Act does go on to define a ‘claim’ broadly (and the seatbelt cases would support a broad interpretation). Textually, other jurisdictions’ statutes more clearly relate to this type of case, as they speak of contributing to ‘incidents’ (the Northern Territory and South Australia, which connects accidents to incidents) or, in the clearest provision, in Queensland, which states that the intoxication presumption applies if the person who suffered harm was intoxicated at the time of the breach of duty giving rise to that person’s claim for damages. In essence, the provisions in New South Wales, Tasmania and Western Australia causally connect the act or omission to the injury or damage. Regardless of what the statutes require the intoxication to contribute to (for example, accident or incident), Prudence will argue that in all cases, causally, the fact that she drank alcopops had nothing to do with her getting cancer. [page 555] Assuming Prudence was ‘impaired’ on any given day she may also wish to rebut the statutory presumption by arguing that her intoxication was not self-induced or voluntary (as required under the statutes). Because of her age, she may be able to convince the court that she did not impair her capacity herself. Rather, it was Derrick who induced her to drink, exploiting her vulnerability as an anxious, needy, desperate, awkward young customer. If, however, the intoxication provisions apply, Prudence’s damages will be subject to an automatic reduction of 25 per cent in the Northern Territory, Queensland, South Australia and Tasmania. Assuming that Aspirationville is in Tasmania, Prudence can argue (and has the onus of satisfying the court) that it would be appropriate for the damages reduction to be smaller, based on the circumstances of the case. She would no doubt note that the control, knowledge and power associated with Sunnyside’s (and Derrick’s) breaches are far greater than any lack of care to herself. She is a mere youngster, who consumed terribly enticing beverages, which were in fact marketed and sold in order to induce this very kind of consumption and eventual dependence. Moreover, they were made available by the person operating the venue, who presumably had a good understanding of their potential effects on a youngster and the possible grave consequences that could result. The power imbalance dictates that a court, in assessing appropriateness, should reduce a contributory negligence finding if it

is possible to do so under the relevant jurisdiction’s Civil Liability Act, despite the fact there may be an element of intoxication affecting her claim. It is conceded that there is no such room for discretion in some jurisdictions. These same arguments would be employed by Prudence if Aspirationville is in the Australian Capital Territory or Western Australia, where the court must reduce her damages to the extent it considers ‘just and equitable’, having regard to her share in the responsibility for the injury (although the Western Australian Act does not provide this explicit guidance). The reduction should be very small, based on the way in which Sunnyside and Derrick exploited the situation, and, in particular, Prudence’s vulnerability. Prudence will face the most difficulties if Aspirationville is in New South Wales, where she would be denied all damages if the court held that her intoxication impaired her capacity to exercise reasonable care and skill, at the time of the breach (which could be characterised as continuing): Civil Liability Act 2002 (NSW) s 50(1), (2). However, Prudence can convincingly respond that it is likely her harm would have occurred even if she had not drunk alcopops (and been intoxicated), because her cancer or injury was the result of the effect the tanning machine had on her skin: s 50(2), (3). She would maintain that this is not a case where drinking was so intimately connected to the harm that recovery should be precluded. Indeed, it is unlikely that parliament would have intended that her circumstances be embraced by the harshness of the preclusion sections. Prudence’s circumstances are quite unlike those that led to the result in Russell v Edwards, where the plaintiff’s excessive drinking, as a result of which he carelessly dived into the shallow end of a swimming pool, hitting his head against the bottom of the pool, was the cause of his injury to himself. Prudence would argue that unlike [page 556] the situation in Russell, her behaviour was not the direct (or proximate) cause of her harm. It should further be noted that under s 50(3) there would be a presumption of contributory negligence if the court is satisfied that Prudence’s injury is likely to have occurred even if she had not been intoxicated, with a consequent 25 per cent (minimum) reduction in damages, unless Prudence can satisfy the court that her drinking ‘did not contribute in any way to the cause of the … injury or damage’. She would argue that this ousting of the presumption is readily satisfied here: while one might speculate that Prudence’s drinking may be causing her some liver damage or another illness related to alcohol consumption, it is difficult to see how it could in any way be seen to be connected causally to her skin cancer. This is unlike Jackson v Lithgow City Council, where walking the dog in a park managed by the council, while intoxicated at 3:30 am, enlivened the provisions and the 25 per cent reduction. If the court does conclude that Prudence was contributorily negligent, it is required by the apportionment legislation to reduce the amount of damages she recovers ‘to such extent as the court thinks just and equitable’, having regard to her share in the

responsibility for her injuries. In Pennington v Norris, the High Court of Australia held that this process requires a ‘comparison of culpability’ between the defendant and the plaintiff, whereby the extent to which each departed from the standard of the reasonable person is compared. In Pennington’s case, the plaintiff, a pedestrian, was run over as a result of the negligent driving of the defendant. The High Court held that the appropriate apportionment of liability was 20 per cent to the plaintiff and 80 per cent to the defendant, because the defendant had put others in the community, including the plaintiff, at risk of injury, whereas the plaintiff’s own negligence had put only himself at risk. As the High Court made clear in Podrebersek v Australian Iron & Steel Pty Ltd (endorsed in Wynbergen v Hoyts Corporation Pty Ltd), ‘the relative importance of the acts of the parties in causing the damage’ must be considered, reflecting both the degrees of negligence and causal potency of the relative failures. Here, applying that long-standing traditional approach, the court should have regard to a number of facts which demonstrate why any contributory negligence finding should be minimal. Sunnyside Solarium (and Derrick Danson) ran a business that ignored the industry code of practice in terms of health and wellbeing. Sunnyside allowed Prudence to tan for far too long a period of time and far too frequently. Sunnyside also allowed a minor to drink and even encouraged this harmful behaviour. Sunnyside put Prudence (and one can presumably infer, other patrons) into jeopardy. Prudence’s actions to herself in staying too long and going too often (and drinking) did not put anyone else at risk. Thus, using a Pennington-like comparison between Sunnyside’s (and Derrick’s) negligence with Prudence’s negligence to herself (as required under the apportionment legislation) the defendants should be regarded as far more culpable than Prudence. Prudence may note the shift away from the Pennington approach in a number of cases, primarily but not exclusively from New South Wales, such as T & X Co Pty Ltd v Chivas, Steen v Senton and Boral Bricks v Cosmidis (No 2), which tend to often (but not always) involve drivers and pedestrians. In these cases the courts asserted [page 557] that the driver should not be assumed to have the greater share of responsibility in an accident with a pedestrian just because she or he is the driver. Because of the context in which those cases arose, they are not particularly relevant here. Further, this shift was not endorsed by the court in Boateng v Dharamdas. Finally, even if the underlying rationale for the shift, derived from the Ipp Panel Report’s emphasis on personal responsibility, is employed here it should not negatively affect Prudence’s claim. She would contend that the defendants’ conduct in her scenario is far more unreasonable and causally significant than hers. Prudence concedes that appeal courts should exercise restraint, respecting the trial judge’s (or jury’s) discretion when presented with arguments that contributory negligence findings should be reversed or that the reductions that had been made for contributory negligence should be changed. In Podrebersek v Australian Iron & Steel Pty Ltd, the High Court noted that the fact finder’s decision should not be lightly

reviewed. Although this was endorsed, by way of example, in a case such as Asim v Penrose, courts have repeatedly emphasised that this does not mean that errors should not be corrected. Indeed, that is the role of appellate courts. That said, in Waterfall v Antony the Victorian Supreme Court, Court of Appeal stated that in an appeal by way of rehearing the court has to make up its own mind, even if there is no error in the lower court finding. Examples of notable successful appeals with respect to either the contributory negligence finding or the apportionment determination include Pennington v Norris, Kelly v Bega Valley County Council, Liftronic Pty Ltd v Unver, Stojan (No 9) Pty Ltd v Kenway, Randwick City Council v Muzic, Paltidis v State Council of the Young Men’s Christian Association of Victoria Inc, Zanner v Zanner, Rockdale City Council v Simmons and Stenning v Sanig. Here, the trial judge erred in finding contributory negligence in the first place, bearing in mind Prudence’s age and the fact the intoxication did not cause her cancer (as explained above). Alternatively, even if the finding of contributory negligence were upheld, the size of the damages reduction is excessive (for reasons noted above) and should be corrected in a manner not unlike that effected on appeal in Kelly, also involving a child plaintiff. These types of errors can and should be corrected on appeal. Even if Prudence’s excessive tanning might have been a failure to herself that contributed to her harm, Sunnyside permitted this to occur. Its culpability was far more significant when compared with Prudence’s conduct for the purposes of the analysis employed by the High Court in Pennington, Podrebersek and Wynbergen. Because Sunnyside and Derrick were far more culpable than Prudence (unreasonable and causally potent), they should bear a much higher proportion of the loss. To sum up, even though appellate courts have been reluctant to substitute their own apportionment of liability for those of lower courts and juries, the courts did so in particularly noteworthy cases like Pennington v Norris and Kelly. Given that the lower court’s apportionment of 80 per cent in this case is clearly in error, the appeal court should substitute a reduction of no more than 10 per cent if it does indeed find that Prudence was contributorily negligent (which Prudence does not concede should be found in the first place). A reduction of no more than 10 per cent is appropriate, just and equitable (the gist of the language used in apportionment statutes), bearing in mind the parties’ relative culpabilities.

[page 558]

Problem 2 10.51 Pasquale received a pair of rollerblades for his 10th birthday. The following Sunday, he went to Daisy Bay Beach with his parents. While his parents were sitting on the sand, Pasquale went blading. He used a path marked for use only by cyclists and

rollerbladers. That path ran alongside an adjoining path reserved for pedestrians, many of whom enjoyed a long stroll along the riverside leading to the beach, having spent several hours at the Daisy Bay Casino. Up until the previous week, signs had shown that rollerbladers were to share the path used by pedestrians; cyclists used to have their own path. However, as a result of the curious but large decline in the number of cyclists, the local council had decided to change the signs so that rollerbladers would share the cyclists’ path instead of the path used by pedestrians. While Pasquale was negotiating a bend in the path, a cyclist, Domenica, collided with him from behind at great speed. Domenica had been riding on the same path every Sunday for the past four years. She had not read the signs, which clearly showed that the path she had been using was no longer reserved for cyclists, but also was to be shared with rollerbladers. The collision caused Pasquale to fall to the ground and injure his head. He was not wearing a helmet. Although there was no law in Daisy Bay requiring rollerbladers to wear helmets, it is likely that Pasquale’s injury would have been prevented had he been wearing one. Pasquale brought an action in negligence against Domenica. At trial, the judge found in Pasquale’s favour but reduced his damages award by 70 per cent for contributory negligence. The case is now on appeal. Discuss whether or not Pasquale was contributorily negligent and, if he was, what the appropriate apportionment of liability should be. (For the moment, confine yourself to considering the acts of Pasquale and Domenica. Do not consider whether the local council was at fault or how liability could possibly be apportioned among Pasquale, Domenica and the local council if all three were held to be at fault.)

Further discussion 1. Should a plaintiff’s severe physical disabilities relieve her or him of being found contributorily negligent? 2. Should a plaintiff’s severe intellectual impairment relieve her or him of being found contributorily negligent? 3. Recall Town of Port Hedland v Hodder (see 10.14). In that case, Martin CJ stated (at [156]): The trial judge concluded with apparent reluctance that he was bound by authority and by the proper construction of s 5K of the CLA [Civil Liability Act 2002 (WA)] to assess the question of whether Mr Hodder had failed to take

[page 559] reasonable care for his own safety and, if so, the extent of his culpability on what he described as an ‘objective basis’, by which he meant without regard to any of Mr Hodder’s various disabilities. Considering himself bound to proceed in that way, he assessed the issues associated with the claim of contributory negligence on the basis that Mr Hodder was a normal able-bodied 23-year-old man, with normal hearing and vision, and of normal intellectual ability. The harshness, injustice and unfairness in this approach is manifest. It assumes a miracle of biblical proportions and requires the court to assess the question of contributory negligence in some parallel universe in which the blind can see, the deaf can hear, the lame can walk or even run, and the cognitively impaired are somehow restored to full functionality.

Discuss. 4. In your view, should ‘mere inattention or inadvertence’ in the workplace context (such as factory settings) be considered equivalent to contributory negligence? 5. Do you think the shift away from the traditional approach to apportionment from Pennington v Norris and Podrebersek v Australian Iron & Steel Pty Ltd is appropriate and/or desirable? Is your answer confined to particular contexts? 6. Can you justify the fact that different jurisdictions have enacted varying legislative responses to issues involving intoxication, ranging from Victoria’s relatively moderate response (in most circumstances) to those prescribed in Queensland, South Australia and New South Wales? Whose approach do you prefer, and why? 7. Discuss whether or not you agree with the result and reasoning in Russell v Edwards. What would happen if Russell v Edwards had taken place in another jurisdiction, such as Victoria? 8. Revisit and reconsider preceding chapters’ problems and the kinds of contributory negligence arguments that could be raised in them. If contributory negligence can be established, what apportionment of liability would be appropriate in your responses to these problems? You should also consider contributory negligence arguments when discussing subsequent chapters’ problems (where

relevant).

Further reading Balkin R P and Davis J L R, ‘Defences to Intentional Torts to the Person and Property’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 6. Barker K, Cane P, Lunney M and Trindade F, ‘Defences to Torts Involving Negligence’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 12. Garling P, ‘Civil Liability Act 2002 — Burdens for a Defendant’, New South Wales Bar Association Personal Injury Conference, Sydney, 15 March 2014. Katter N, ‘Negligence and Intoxication — Has Civil Liability Reform Gone Too Far?’ (2006) 11 Deakin Law Review 161. [page 560] Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Defences to Torts Involving Negligence’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 6. Shincore M, ‘Drinking, Driving and Causing Injury: The Position of the Passenger of an Intoxicated Driver’ (2007) 7 Queensland University of Technology Law and Justice Journal 375. Thorpe D, ‘Adolescent Negligence, “Obvious Risk” and Recent Developments in Neuroscience’ (2014) 21 Torts Law Journal 195.

1

This is the Wrongs Act 1958 (Vic) s 26(1), (1A). See also Civil Law (Wrongs) Act 2002 (ACT) s 102; Law Reform (Miscellaneous Provisions) Act 1965 (NSW) s 9; Law Reform

2 3 4

5

6

7 8 9 10

11 12 13 14 15 16 17

18

19 20

21 22

(Miscellaneous Provisions) Act 1956 (NT) s 16; Law Reform Act 1995 (Qld) s 10; Wrongs Act 1954 (Tas) s 4. Law Reform (Contributory Negligence and Apportionment of Liability) Act 2001 (SA) s 7. Law Reform (Contributory Negligence and Tortfeasors’ Contribution) Act 1947 (WA) s 4. Civil Law (Wrongs) Act 2002 (ACT) s 101; Law Reform (Miscellaneous Provisions) Act 1965 (NSW) s 8; Law Reform (Miscellaneous Provisions) Act 1956 (NT) s 15(1); Law Reform Act 1995 (Qld) s 5; Law Reform (Contributory Negligence and Apportionment of Liability) Act 2001 (SA) s 3; Wrongs Act 1954 (Tas) s 2; Wrongs Act 1958 (Vic) s 25; Law Reform (Contributory Negligence and Tortfeasors’ Contribution) Act 1947 (WA) s 3A. Civil Liability Act 2002 (NSW) s 5R; Civil Liability Act 2003 (Qld) s 23; Civil Liability Act 1936 (SA) s 44(1) (the wording is different to other jurisdictions, although the effect is similar); Civil Liability Act 2002 (Tas) s 23; Wrongs Act 1958 (Vic) s 62; Civil Liability Act 2002 (WA) s 5K. Civil Liability Act 1936 (SA) s 49. If the injured person was not in a ‘passenger compartment’ at the time of the accident, as she or he should be, this too will lead to a presumption of contributory negligence. Motor Accidents Compensation Act 1999 (NSW) s 138(2)(c), (d). Civil Law (Wrongs) Act 2002 (ACT) s 97. The passenger compartment requirements apply here, as in South Australia. Motor Accidents (Liabilities and Compensation) Act 1973 (Tas) s 22(4). Civil Law (Wrongs) Act 2002 (ACT) s 102; Law Reform (Miscellaneous Provisions) Act 1965 (NSW) s 9; Law Reform (Miscellaneous Provisions) Act 1956 (NT) s 16(1); Law Reform Act 1995 (Qld) s 10(1); Law Reform (Contributory Negligence and Apportionment of Liability) Act 2001 (SA) s 7(2); Wrongs Act 1954 (Tas) s 4; Wrongs Act 1958 (Vic) s 26(1); Law Reform (Contributory Negligence and Tortfeasors’ Contribution) Act 1947 (WA) s 4(1). D Payne, ‘Reduction of Damages for Contributory Negligence’ (1955) 18 Modern Law Review 344. Civil Law (Wrongs) Act 2002 (ACT) s 47; Civil Liability Act 2002 (NSW) s 5S; Civil Liability Act 2003 (Qld) s 24; Wrongs Act 1958 (Vic) s 63. Wrongs Act 1954 (Tas) s 4(1). Civil Liability Act 1936 (SA) s 50. Wrongs Act 1958 (Vic) s 26(4). Civil Law (Wrongs) Act 2002 (ACT) s 27. Civil Liability Act 2002 (NSW) s 5T; Law Reform Act 1995 (Qld) s 10(5); Civil Liability Act 1936 (SA) s 45; Wrongs Act 1954 (Tas) s 4(4); Law Reform (Contributory Negligence and Tortfeasors’ Contribution) Act 1947 (WA) s 4(2). Motor Accidents Compensation Act 1999 (NSW) s 138(2)(a). The guest passenger provisions under the previous incarnation of this Act were considered in Joslyn v Berryman; Wentworth Shire Council v Berryman. Wrongs Act 1958 (Vic) ss 14G, 14B(4)(fa). Civil Law (Wrongs) Act 2002 (ACT) s 95; Civil Liability Act 2002 (NSW) s 50; Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 14(1); Civil Liability Act 2003 (Qld) s 47; Civil Liability Act 1936 (SA) s 46(1); Civil Liability Act 2002 (Tas) s 5; Civil Liability Act 2002 (WA) s 5L. Civil Liability Act 2002 (NSW) s 48. Civil Law (Wrongs) Act 2002 (ACT) ss 93(1), 95(1).

23 24

25 26

27 28 29 30 31 32 33 34 35 36 37

38 39 40 41

Personal Injuries (Liabilities and Damages) Act 2003 (NT) ss 3, 14(1). Civil Liability Act 2002 (NSW) s 50(1); Civil Liability Act 2003 (Qld) s 47(1); Civil Liability Act 2002 (Tas) s 5(1); Civil Liability Act 2002 (WA) s 5L(1). Western Australia uses the phrase ‘caused the harm’. Civil Liability Act 1936 (SA) ss 3, 46(1). Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 14(2); Civil Liability Act 2003 (Qld) s 47(3); Civil Liability Act 1936 (SA) s 46(2); Civil Liability Act 2002 (Tas) s 5(1), (5); Civil Liability Act 2002 (WA) s 5L(2), (3). Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 17; Civil Liability Act 2003 (Qld) s 47(4); Civil Liability Act 1936 (SA) s 46(3). Civil Law (Wrongs) Act 2002 (ACT) s 95(3). Civil Liability Act 2002 (Tas) s 5(2), (3). Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 16; Civil Liability Act 1936 (SA) s 48(1). Civil Liability Act 1936 (SA) s 48(2). Civil Liability Act 2003 (Qld) s 47(5); Civil Liability Act 1936 (SA) s 46(4). Motor Accidents Compensation Act 1999 (NSW) s 138(2)(b); Civil Liability Act 1936 (SA) s 47(1), (4). Motor Accidents Compensation Act 1999 (NSW) s 138(2)(b); Civil Liability Act 1936 (SA) s 47(2). Civil Liability Act 2003 (Qld) s 49; Civil Liability Act 1936 (SA) s 47(3), (5). Motor Accidents Compensation Act 1999 (NSW) s 138(3). Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 15; Civil Liability Act 2003 (Qld) s 48; Civil Liability Act 1936 (SA) s 47(1). The guest passenger reliance provisions noted in 10.36 do not apply in the Northern Territory, where the right to sue for personal injuries in motor vehicle accidents has been abolished. Civil Law (Wrongs) Act (ACT) s 96; Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 17; Civil Liability Act 2003 (Qld) s 48(4); Civil Liability Act 1936 (SA) s 47(3). Civil Law (Wrongs) Act 2002 (ACT) s 96(5); Civil Liability Act 2003 (Qld) s 48(5); Civil Liability Act 1936 (SA) s 47(6). Civil Liability Act 2002 (NSW) s 49; Civil Liability Act 2003 (Qld) s 46. Civil Liability Act 2002 (NSW) s 50.

[page 561]

11 Other Defences and Special Protections Objectives After completing this chapter, you should: — understand the fundamental common law principles underlying the ‘voluntary assumption of risk’ defence; — understand how some jurisdictions’ legislative schemes have changed aspects of the common law with respect to ‘obvious risks’ and ‘dangerous recreational activities’; — understand the exclusion of liability by notice defence; — have a working knowledge of how some recreational service providers can avoid liability; — understand the effects of the plaintiff’s illegal conduct on her or his claim at common law; — understand the principles relevant to claims involving joint illegal enterprises; — understand the effects of the plaintiff’s illegal conduct on her or his claim under legislative schemes; — understand the operation of statutory protections or immunities provided to certain defendants, such as good Samaritans and volunteers.

Key cases — Insurance Commissioner v Joyce (1948) 77 CLR 39 — Miller v Miller (2011) 242 CLR 446; 275 ALR 611 — Smith v Charles Baker & Sons [1891] AC 325 — Rootes v Shelton (1967) 116 CLR 383; [1968] ALR 33 [page 562]

Key legislative developments Most jurisdictions’ Civil Liability or Wrongs Acts prescribe: — a partial onus reversal in circumstances involving ‘obvious risks’ (as defined under the Acts); — the consequences of the plaintiff’s illegality on the plaintiff’s claim; — protections for food donors, good Samaritans and volunteers. Some jurisdictions’ Acts prescribe: — the consequences of participating in a dangerous recreational activity; — the consequences of being a recreational service provider; — wide-ranging protections or immunities.

Introduction 11.1 In this chapter we consider a number of ways in which defendants can, on appropriate facts, attempt to relieve themselves of liability. We begin by considering a longstanding common law defence

known as ‘voluntary assumption’ of risk. We then explore a number of statutory changes made to aspects of this defence in several jurisdictions. A somewhat related defence, ‘exclusion of liability by notice’, is also considered. The effect of the plaintiff’s illegality on her or his claim at common law and under statute is also discussed in this chapter. Further, the consequences of the plaintiff’s involvement in a ‘joint illegal enterprise’ with the defendant, which can raise critical duty of care issues, are also explored. This chapter concludes with a discussion of certain kinds of actors or enterprises that have been selected for special treatment by the law, whereby their carelessness is protected from suit. These include food donors, volunteers and good Samaritans.

Voluntary Assumption of Risk Elements of the defence 11.2 If the defendant can prove that the plaintiff voluntarily assumed the risk of being injured as a result of the defendant’s negligence, then the defendant is not liable at all for the plaintiff’s injuries. The defence of voluntary assumption of risk is a complete defence and is often known by its Latin name, volenti non fit injuria. Roughly translated, this means ‘there can be no injury to the willing’. In essence, there are three criteria that have to be satisfied to make out the defence (noted in Scanlon v American Cigarette Company (Overseas) Pty Ltd (No 3) [1987] VR 289): (i) the plaintiff knew the facts constituting the risk or danger; (ii) the plaintiff appreciated or understood the risk; (iii) the plaintiff freely and willingly consented to the danger or risk. [page 563] See also McClellan CJ in Carey v Lake Macquarie City Council (2007)

Aust Torts Reports ¶81-874; [2007] NSWCA 4, where his Honour discussed this defence in the context of a cyclist who collided with a bollard that had been placed on a path in a park (see 11.26). In that case, McClellan CJ also noted (at [86]) that ‘[u]ntil the recent statutory amendments provided by the Civil Liability Act 2002 (NSW) a defendant faced a difficult task to prove volenti’. These provisions are considered from 11.21. One major difference between contributory negligence and voluntary assumption of risk is that the latter defence requires subjective knowledge of risk on the part of the plaintiff, whereas contributory negligence is objective in nature — that is, the plaintiff acted below the standard expected of the reasonable person in the circumstances. As one can imagine, this makes proving voluntary assumption of risk quite difficult, compared to contributory negligence. Further, as we noted above, voluntary assumption of risk is a complete defence to an action in negligence, as opposed to a contributory negligence finding, which results in apportionment. 11.3 The defence of voluntary assumption of risk was of widespread application in the 19th century. It was commonly used by employers whose employees had been injured at work, particularly in dangerous occupations such as coal mining or heavy industry. Employers successfully argued that their employees could not complain if they were injured at work, as they had chosen to do the work despite knowing it was dangerous. For example, in Thomas v Quartermaine (1887) 18 QBD 685, the plaintiff was severely scalded when he fell into a vat of boiling water from an unfenced walkway, and he sued his employer, the defendant. The court held that the defendant had been negligent in not fencing the vat, but the plaintiff’s action failed because he had voluntarily assumed the risk of falling into the vat by continuing to work for the defendant despite the evident risk of injury posed by the unfenced vat. Thomas v Quartermaine is an example of the 19th-century philosophy of absolute freedom of contract, which bore little relationship to reality in the social conditions of the time. According to this philosophy, the

plaintiff employee was always free to leave the defendant’s employment and get another, safer, job. If she or he did not do so, then she or he must have consented to all of the risks of the job offered by the defendant. Any argument that it was not, in fact, possible for workers to move freely from one job to another in a purely competitive market received short shrift. For example, when Bramwell LJ gave evidence in 1877 to the Parliamentary Select Committee that considered the introduction of the Employers’ Liability Bill, he said: Why does he not leave the employment if he knows that it is dangerous? To my mind, it is a sad thing to hear men come into court, as I have heard them, and excuse themselves for not having done that on the ground that their bread depended upon it, or something of that sort. [Quoted in A H Manchester, Modern Legal History, Butterworths, London, 1985, at 296.]

11.4 Such views seem barbarous today. Indeed, they seemed barbarous to many then. The defence of voluntary assumption of risk was finally wrenched free of the laissez-faire doctrine of freedom of contract by the following great case. [page 564] Key Case Smith v Charles Baker & Sons [1891] AC 325 Facts: The defendants, who were building a new railway, employed the plaintiff. The plaintiff and his workmates stood at the bottom of a railway cutting, where they cut rock with hammers and chisels. Above their heads, a crane lifted rocks and stones from the cutting to railway wagons on the line nearby. The plaintiff had worked in this way for about two months, when a rock fell from the crane and landed on him, severely injuring him. He alleged that his injuries had been caused by the negligent operation of the crane, and by a negligent failure to warn him of the falling rocks. At first instance, the plaintiff admitted that he was aware of the risk posed by the overhead crane. Issue: Had the plaintiff voluntarily assumed the risk of harm, such that he could not sue successfully? Decision: The jury found for the plaintiff. The defendants appealed, arguing that the trial judge should not even have allowed the case to go to the jury for a verdict, because of the plaintiff’s admission that he had continued to work under the crane, knowing of the

risks that it posed. The House of Lords held, by a majority of four to one, that the mere fact that the plaintiff continued in the employment with full knowledge and understanding of the danger did not preclude him from recovering. Lord Halsbury LC said (at 338): [I]n order to defeat the plaintiff’s right [to damages] by the application of the maxim relied on [ie volenti non fit injuria] … the jury ought to be able to affirm that he consented to the particular thing being done which would involve that risk, and consented to take that risk upon himself.

11.5 In effect, the majority in Smith’s case held that the defendant must show two things: first, that the plaintiff was aware of the risk of negligence on the part of the defendant, and second, that the plaintiff consented to that particular risk. The simple fact that the plaintiff had undertaken a job that she or he knew to be generally dangerous was insufficient to lead to the inference that she or he had consented to the particular risk of being injured as a result of negligence.

Scope of the defence 11.6 Smith’s case dramatically reduced the scope of the defence of voluntary assumption of risk. The defence could no longer succeed simply because the plaintiff continued to work at a job which she or he knew to be dangerous. Further, although Smith’s case was concerned with the specific relationship of employer and employee, it laid down a proposition of general application. In general, it is not enough for the defendant to prove that the plaintiff has voluntarily undertaken an activity that she or he knew to be dangerous. In order for the defence to succeed, the defendant must also prove that the plaintiff consented to the risk of negligence on the part of the defendant. This requirement is illustrated by the following case. [page 565] Key Case

Rootes v Shelton (1967) 116 CLR 383; [1968] ALR 33 Facts: The plaintiff was injured while performing a dangerous water-skiing exercise known as ‘crossovers’ or ‘Russian Roulette’, in which the plaintiff and other water-skiers crossed over in front of one another while being towed behind the same boat, which was driven by the defendant. While engaged in this manoeuvre, the plaintiff collided with a boat that was moored in the water. The plaintiff alleged that the defendant had been negligent in steering too close to the moored boat, and in failing to warn the skiers of the presence of the boat. Issue: Had the plaintiff voluntarily assumed the risk of harm, such that he could not sue successfully? Decision: The defendant argued that the plaintiff had voluntarily assumed the risks of water skiing, a dangerous sport, and, in particular, the greater risks associated with the ‘crossover’ exercise. The High Court of Australia unanimously held that the plaintiff’s action succeeded. Owen J said (at CLR 395; ALR 41): To say that the [plaintiff] voluntarily assumed the risk of colliding with an obstruction in the water is one thing. To say that the [plaintiff] voluntarily undertook the risk that the [defendant] would carelessly fail to warn him of the presence of such an obstruction or would fail to exercise due care in steering the launch of which he had control is a very different proposition and one for which I can find no support in the evidence.

11.7 Similarly, the mere fact that an employee has agreed to do a job that is generally risky does not raise an inference that she or he has thereby voluntarily assumed the particular risk of being injured by the defendant’s negligence while doing that job. Thus, in modern times, the defence rarely succeeds in actions brought by employees against their employers. For example, in Cvetkovic v Princes Holdings (t/as Tilt Amusement Centre) (1989) 51 SASR 365, the plaintiff was employed by the defendant as a doorman at the defendant’s amusement centre. Although the plaintiff was not a ‘bouncer’, the defendant’s manager directed him to break up an argument between some customers, who turned on the plaintiff and violently attacked him with billiard cues. It was held that the defendant had negligently failed to protect the plaintiff from the reasonably foreseeable risk of violent assault, and

that the plaintiff had not voluntarily assumed the risk of injury simply by accepting work as a doorman. The defence also failed in Oran Park Motor Sports Pty Ltd v Fleissig; Teamfox Pty Ltd v Fleissig [2002] NSWCA 371, where the plaintiff sustained injuries while participating in a go-kart race. His suit against his employer and the occupier of the premises where the race took place involved assessing the nature of the precautions used (or not used) at the side of the concrete wall where the accident occurred, which was a bend known as ‘Champion Corner’. Indeed, the presence of a concrete wall at this location was itself the subject of concern. The plaintiff’s employer argued that the plaintiff had voluntarily assumed the risk of injury of racing on [page 566] the track, knowing there was no padding against the racing face of the wall. For the defence to succeed, the precise risk culminating in injury must be defined. The court noted (at [104]–[105]): The plaintiff must be shown to have fully appreciated the nature and extent of the risk and not merely the existence of a danger. … Further the plaintiff must not only consent to the risk but must also assume the risk freely and voluntarily. The volens principle has been invoked frequently in actions by servants against employer[s] for negligence without much success.

11.8 In New South Wales, the voluntary assumption of risk defence has actually been abolished in actions by employees against their employers: see Workers’ Compensation Act 1987 s 151O. The Act provides that where the defence would otherwise have been available, damages are reduced to such an extent as is just and equitable (in a manner similar to contributory negligence). 11.9 Historically, aside from workplace cases, this defence used to be argued when a rescuer willingly exposed herself or himself to danger in order to effect a rescue. However, for many years now, it has been accepted that individuals who injure themselves in the course of rescue do not freely and willingly encounter the danger. To

encourage acts of rescue (which are themselves not legally required) courts have, for policy reasons, characterised acts of rescue as conduct dictated by moral compulsion. The landmark English case, Haynes v Harwood [1935] 1 KB 146 reflects this (see 4.40). In Morton v Tasmania [2006] TASSC 62, the Full Court of the Supreme Court of Tasmania considered whether the trial judge should have allowed the volenti defence to be put to the jury, in what the plaintiff alleged was an emergency rescue context at sea. He had responded to a call for assistance and indeed provided assistance to a fishing patrol vessel; he was injured on his return journey to his fishing ground, in what was arguably inclement weather (whether or not the weather was ‘extreme’ and the seas ‘rough’ was disputed). The Full Court dismissed the plaintiff’s appeal. After referring to Haynes v Harwood and Ward v TE Hopkins & Son Ltd [1959] 3 All ER 225, Crawford J stated (at [54]–[55]): The basis for the denial of the defence is that because a rescuer acts under the impulse of a duty, whether it be legal, moral or social, he or she does not exercise freedom of choice and therefore is not a volunteer. In this case, the rescue situation, if there ever was one in the true sense, was over at the time that the appellant decided to set off from Preservation Island on his return journey. He was no longer acting in a rescue situation.

11.10 In most cases, the defendant must persuade the court that the plaintiff’s consent to the risk of negligence can be inferred from her or his conduct. The inference of consent to injury caused by negligence has often been considered in cases of drunk drivers causing injury to passengers. The following case illustrates how the defence has operated in those circumstances. It is important to note that in a modern context, the legal consequences of intoxication are significantly affected by statutory interventions and contributory negligence: see 3.69–3.70 and 10.36–10.47. [page 567] Key Case

Insurance Commissioner v Joyce (1948) 77 CLR 39 Facts: The plaintiff was a passenger in a car driven by a man named Kettle. He was found drunk, injured and unconscious in the passenger seat of the car, which had crashed into the back of a stationary truck, and then run through the gate of a nearby house. Kettle was found under some bushes nearby, asleep and very drunk. He later told the police that his car had collided with the parked truck through mismanagement on his part. The plaintiff sued Kettle, alleging that his injuries had been caused by Kettle’s negligent driving. Kettle did not enter an appearance, and the action was taken over by the Insurance Commissioner as nominal defendant. Neither the plaintiff nor Kettle gave evidence at the trial. Issue: Had the plaintiff voluntarily assumed the risk of negligent driving on Kettle’s part by accepting a ride in the car when he knew that Kettle was drunk (as argued by the Insurance Commissioner)? Decision: The High Court of Australia held, by a majority of two to one, that the plaintiff’s action failed. Latham CJ said that an action by a passenger against a drunken driver should fail on any one of three alternative grounds: (i) the drunken driver had not breached the duty of care owed to a willing passenger; (ii) the passenger had been contributorily negligent (contributory negligence was still a complete defence at that time); (iii) operation of the defence of volenti non fit injuria (at 46). After quoting from the trial judge’s finding that the plaintiff knew of, and voluntarily assumed, the risk of negligent driving by Kettle, Rich J stated (at 49): I think his Honour sitting as a jury was entitled to draw this conclusion. Common sense tells us that the probability is that the passenger quite well knew that the driver was unfit for his task. All sorts of hypotheses may be suggested. It may be conceded that the plaintiff was more drunk than the defendant Kettle; that the defendant Kettle got worse when exposed to the evening air; that they might have got drunk separately and not in combination so that the plaintiff had insufficient time to realise his driver’s state. But this is not a criminal case in which we are called upon to allow our imagination to play upon the facts and find reasonable hypotheses consistent with innocence. A balance of probability is enough. And when the greater probability is that both had enough consciousness to be aware of what they had been doing, although not enough judgment and discretion to drive, why should a judge hesitate to find accordingly against a plaintiff who gives no evidence?

11.11 The defence of voluntary assumption of risk is not available in an action by a voluntary passenger against a drunken driver in jurisdictions such as the Australian Capital Territory and South Australia; in such cases contributory negligence is presumed.1 It is not

available in any action arising out of a motor accident in New South Wales (unless the motor accident involves motor racing).2 [page 568] 11.12 It is clear from what was said in Joyce’s case that at common law the defence will succeed only if the plaintiff was fully aware of the extent of the risk posed by the defendant’s drunkenness. That point was also stressed in Roggenkamp v Bennett (1950) 80 CLR 292. On the facts of that case, the High Court of Australia held that the plaintiff passenger was fully aware of the defendant driver’s drunkenness, as the plaintiff and the defendant had been on a drinking spree together before getting into the defendant’s car. 11.13 A plaintiff who does not fully appreciate the risk of negligence on the part of the defendant cannot be taken to have voluntarily assumed that risk. For example, the defence failed in Randwick City Council v Muzic [2006] NSWCA 66. For many years, the plaintiff would enter the sea baths near her home using steps on a southern promenade. Due to its closure, she used the northern promenade (avoiding the sand pathway because it was often littered with syringes). Despite the fact she walked carefully towards the steps, she slipped and fell, injuring herself. The reason she slipped was because of accumulated algae on this concrete promenade that gave access to a council pool, about which the council had a great deal of knowledge, including evidence of a large number of previous accidents. She argued that while she knew it was slippery, she did not know it was that slippery. The court rejected the defendant’s use of the voluntary assumption of risk defence, because of its inability to prove she had a proper appreciation or comprehension of the extent of the risk created by the defendant. For example, she did not have access to the kind of information the defendant had about the nature of the risk. More unusually, the New South Wales Court of Appeal reversed the trial judge’s contributory negligence finding (and not just the degree of contributory negligence): see 10.32.

11.14 As was noted previously, in older common law cases, scenarios involving drunk driving often raised ‘appreciation’ issues. For example, if both the plaintiff and defendant were drunk, the court could hold that the plaintiff could not fully appreciate that the defendant was incapable of driving carefully. If this is found, the defence must fail. This was demonstrated in O’Shea v Permanent Trustee Co of NSW Ltd [1971] Qd R 1, where the plaintiff was injured when the car in which he was a passenger crashed, killing the driver, Fergus. Both had been drinking before they got into the car; Fergus had a blood alcohol level of 0.15. The defendant, representing Fergus, argued that the plaintiff had voluntarily assumed the risk of negligent driving by accepting a ride with Fergus when he knew that Fergus was drunk. The defence failed: although the plaintiff knew Fergus had been drinking, he had not been with Fergus throughout the evening and did not know how much Fergus had drunk. The court therefore held that he had not accepted the danger with full appreciation of it. However, he was found to be 25 per cent contributorily negligent. Similarly, in Duncan v Bell [1967] Qd R 425, Dodd v McGlashan [1967] ALR 433 and Howard v Hamilton (1996) 16 WAR 292, voluntary assumption of risk failed as a defence because the plaintiff was too drunk to be fully aware of the defendant’s inability to drive carefully. In each case, though, the plaintiff was found to have [page 569] been contributorily negligent: in Duncan’s case and Howard’s case, by 50 per cent; in Dodd’s case, by 10 per cent. 11.15 In McPherson v Whitfield [1996] 1 Qd R 474, the plaintiff was too drunk to appreciate fully the defendant driver’s inability to drive carefully. The Queensland Court of Appeal upheld the trial judge’s finding that the plaintiff had been 20 per cent contributorily negligent, but held that the defence of voluntary assumption of risk should not

be considered because it had not been raised by the defendant until the appeal. In the course of coming to that conclusion, Lee J (with whom McPherson JA agreed) said (at 481): [A]s the law in this area has progressed, it has become harder for a defendant to satisfy the onus of establishing acceptance of a risk in the relevant sense, the tendency nowadays being to head for the option provided for by the apportionment legislation. … Bearing in mind the severity of the consequences from the plaintiff’s point of view then, it is not at all surprising that a court would require very clear conduct indeed before reaching the conclusion that a person who had not expressly done so, had discharged the tortfeasor from liability in respect of the reasonably avoidable consequences of his conduct … Additionally … one might consider it more in accord with contemporary thinking that in the case of an injury produced by a multitude of causes, greater justice would be achieved by the court arriving at a ‘fair and reasonable allocation of the responsibility for the damage’: Pennington v Norris (1956) 96 CLR 10 at 17, rather than by allowing the loss to fall solely on the shoulders of one of the parties.

With the advent of apportionment statutes, which eliminated the harshness of the common law all-or-nothing consequence produced by a contributory negligence finding, McHugh J stated in Joslyn v Berryman; Wentworth Shire Council v Berryman (2003) 214 CLR 552; 198 ALR 137 that in these types of cases, the passenger’s conduct is considered to amount to contributory negligence, and not a voluntary assumption of risk (see 10.5, 10.10, 10.13, 10.36). At the risk of labouring the point, as a reminder, one must be careful to take into account the effects, if any, of relevant statutory provisions. 11.16 One modern context in which this common law defence arguably could succeed involves smokers who sue tobacco manufacturers for illnesses and diseases caused by their smoking. Much of the debate and evidence would focus on the plaintiff’s knowledge of the dangers of smoking and the date at which she or he had knowledge and appreciation of those risks. Whether or not the smoker’s own conduct, smoking cigarettes, can be characterised as freely and willingly encountering the risk would be contentious, ultimately linked to evidence relating to addiction and what is truly volitional or voluntary behaviour. This is especially problematic in cases where those suffering tobacco-related illnesses began smoking as

youngsters or teenagers. As McClellan CJ stated in Carey v Lake Macquarie City Council (having referred to Dixon J in Joyce, albeit in a very different context), the agreement must be truly voluntary — in a ‘real sense’ (see also 11.26, 11.27). [page 570]

Alternative arguments: voluntary assumption of risk defence? Or no breach? Or no duty? 11.17 As we noted above, in Joyce’s case (see 11.10), Latham CJ stated that because the passenger had accepted a ride with a drunken driver, this could give rise to a finding that (i) the driver had not breached the duty of care owed to the passenger, (ii) the passenger had been contributorily negligent and (iii) the passenger had voluntarily assumed the risk of negligence on the part of the driver. Clearly, if the drunken driver had injured another road user, the driver would have breached the duty of care owed to that road user. Therefore, if the drunken driver had not breached the duty owed to his passenger, the extent of that duty must have been modified, as a result of the passenger’s knowledge of the driver’s drunkenness. As we saw in Chapter 3, the High Court of Australia had previously held, in Cook v Cook (1986) 162 CLR 376; 68 ALR 353, that the duty owed by a learner driver to her instructor was different from the duty owed by the learner driver to other road users. However, this proposition was overruled in Imbree v McNeilly (2008) 236 CLR 510; 248 ALR 647: see 3.12. The standard of care owed by the learner driver to the passenger– instructor should not be modified or qualified. 11.18 Gala v Preston (1991) 172 CLR 243; 100 ALR 29 (see 11.43) focused on whether or not a duty of care was owed in a context in which there was a complicating factor — the plaintiff and defendant had been jointly engaged in the illegal enterprise of stealing the car in which they crashed. Voluntary assumption of risk was not argued successfully. The case turned on whether or not a duty to take care

was owed. The High Court of Australia held that the defendant owed the plaintiff no duty of care in the circumstances, both because of the illegality of the joint enterprise in which the plaintiff and defendant were participating and because of the defendant’s drunkenness. Mason CJ, Deane, Gaudron and McHugh JJ said (at CLR 254; ALR 37), ‘each of the parties to the enterprise must be taken to have appreciated that he would be encountering serious risks in travelling in the stolen vehicle when it was being driven by persons who had been drinking heavily. … In the special and exceptional circumstances that prevailed, the participants could not have had any reasonable basis for expecting that a driver of the vehicle would drive it according to ordinary standards of competence and care’. More recently, in the leading High Court of Australia case, Miller v Miller (2011) 242 CLR 446; 275 ALR 611, the plaintiff sustained injuries when she and the defendant were allegedly engaged in a joint illegal enterprise. Voluntary assumption of risk was not argued; rather, the defendants alleged that no duty of care was owed. The plaintiff succeeded in her claim: see 11.45. 11.19 It may seem to make little difference whether the court holds that the plaintiff passenger voluntarily assumed the risk of negligence on the part of the drunken defendant driver, as it did in Joyce’s case, or whether it holds that the defendant owed the plaintiff no duty of care, as it did in Gala’s case, because the plaintiff’s [page 571] action fails either way. However, there is a difference where the plaintiff knew of the risk but was not in a condition to fully appreciate and/or voluntarily assume it. To characterise the question in terms of the existence of a duty of care focuses on whether the court is willing to hold that a legally recognised relationship exists when the plaintiff and defendant were jointly engaged in an illegal activity, rather than

on whether the plaintiff both knew of, and voluntarily consented to, the risk of negligence on the part of the defendant. 11.20 Recall how different jurisdictions had passed legislation to address conduct involving intoxication. The provisions range from legislatures directing courts to take intoxication into consideration when assessing the defendant’s standard of care in a breach assessment (see 3.70), to imposing mandatory findings of contributory negligence (sometimes with fixed damages reductions), to disentitling recovery (like a complete defence) (see 10.38–10.47). With respect to relevant case law, see 10.36–10.37, and decisions such as Joslyn v Berryman, Avram v Gusakoski (2006) Aust Torts Reports ¶81-836; 31 WAR 400 and Allen v Chadwick (2015) 256 CLR 148.

Assumption of ‘obvious risks’: under the statutes 11.21 In Chapter 3 we explored how ‘obvious risks’ have been treated by the High Court of Australia, as part of breach and standard of care considerations, governed by common law doctrine. We now discuss statutory provisions that address ‘obvious risks’ under a large number of jurisdictions’ Civil Liability Acts, in the context of the voluntary assumption of risk defence. What is an ‘obvious risk’ under some Civil Liability Acts? 11.22 The ‘obvious risk’ statutory provisions generally stipulate that in determining negligence liability, the person who suffers harm is presumed to be aware of the risk of injury if the risk was ‘obvious’ to a reasonable person in her or his position. Obvious risks are defined (again, in general terms) to include risks: •

that are ‘patent or a matter of common knowledge’ even though the likelihood of the risk occurring is low;

•

but do not have to be ‘prominent, conspicuous or physically observable’ (although the latter is not included in the South Australian definition). Although the provisions regarding ‘obvious risk’ in New South

Wales, Queensland, South Australia, Tasmania, Victoria and Western Australia are similar, they are not identical in their terms.3 11.23 ‘Recreational activities’ (in particular, ones that are ‘dangerous’) are given additional explicit consideration by statute in New South Wales, Queensland, Tasmania and Western Australia (as we discuss at 11.29). [page 572] Limited onus reversal under several Civil Liability Acts 11.24 In general terms, if the risk of harm is determined under the statutory definition to be an ‘obvious’ one, as variously defined under the Civil Liability Acts, then an aspect of the common law defence of voluntary assumption of risk is affected: the statutes partially reverse the onus of proof. The person who suffered harm is ‘presumed to have been aware of the risk’ unless she or he can show she or he was not aware of the risk. Because the injured person is presumed to be aware of this obvious risk, it is easier for the defendant to successfully employ this defence. Whether the risk itself is an obvious one is an objective inquiry. The presumption relates to whether or not the plaintiff was aware of that risk (see 11.27) and this presumption is only activated when the risk is deemed to be an obvious one. If, for example, you trip on an unpaved path leading to someone’s home, this could arguably be deemed to be an obvious risk under the statutory definitions, because it is obvious to a reasonable person in your position, even though the risk of injury is not likely and the risk presented is not necessarily that visible. You would be presumed to be aware of the risk. This should ease the burden on the defendant with respect to proving this aspect of the voluntary assumption of risk defence. Furthermore, there is (in general terms) no proactive obligation to warn of this risk — because it is ‘obvious’. As the injured person, you can adduce evidence to rebut this presumption, proving that you were not in fact aware of the risk: you may argue that you

were unaware of the risk’s ‘precise nature, extent or manner of occurrence’ (although the Victorian statute is silent on this point). 11.25 The sections speak of being ‘aware’ of the risk. They do not address the voluntariness element of the volenti defence. As Carey v Lake Macquarie City Council (see 11.26) highlighted, the provisions do not affect (that is, reverse) the common law onus of proof principle requiring the defendant to prove, on a balance of probabilities, that the injured person freely and willingly accepted the risk. On this point, see the lengthy discussion in Schuller v SJ Webb Nominees Pty Ltd [2015] SASCFS 162 and the legislative provisions in the South Australian Act (see 11.27). 11.26 In Carey v Lake Macquarie City Council, McDougall J observed (at [117]) ‘[t]he interaction of ss 5F and 5G [of the New South Wales Act] … with the common law concept of voluntary assumption of risk gives rise to very difficult questions’. In Angel v Hawkesbury City Council (2008) Aust Torts Reports ¶81-955; [2008] NSWCA 130 (see 11.27), the New South Wales Court of Appeal (unanimously, as a bench of five judges) clarified when the statutory sections on ‘obvious risks’ are engaged. The court stated (at [83]): A finding that a risk of harm is an ‘obvious risk’ within the meaning of s 5F(1) so that pursuant to s 5G(1) the person who suffers harm is presumed to be aware of that risk, does not, as the Council would have it, automatically lead to a finding of no breach of duty. Sections 5F and 5G are contained in Division 4 of Part 1A of the [Civil Liability Act 2002 (NSW)] entitled ‘Assumption of risk’. The purpose of

[page 573] that Division is, at least in part, to make it easier for a defendant to establish the common law defence of voluntary assumption of risk or volenti: CG Maloney Pty Ltd v Hutton-Potts [2006] NSWCA 136 at [101] per Santow JA; Carey at [34]. Except with respect to an ‘obvious risk’ which obviates any common law duty to warn (see s 5H), the provisions of ss 5F and 5G and, in particular, the statutory definition of an ‘obvious risk’, have no relevance to the question of breach of duty.

The court further observed (at [84]): This is not to say that the obviousness of the risk is irrelevant to an analysis of the

breach question. But as Santow JA pointed out in [CG Maloney Pty Ltd v Hutton-Potts [2006] NSWCA 136 (see 11.27) at [103]], a finding that the risk is ‘obvious’ does not produce a preordained outcome to that question.

Examples 11.27 Somewhat ironically, bearing in mind the Ipp Panel’s and legislatures’ intention that personal injury litigation be reduced, these provisions have generated a large number of law suits. These cases, primarily but not exclusively coming from New South Wales, apply the statutory provisions in a manner that is highly factually-specific. They highlight the need to closely scrutinise the circumstances of the relevant risk. Not long after the enactment of the New South Wales provisions, the New South Wales Court of Appeal considered what was meant by the ‘reasonable person in the position of the person who suffers harm’ in the following case. Case Example Doubleday v Kelly (by her next friend Kelly) [2005] NSWCA 151 Facts: A seven-year-old child slept over at the home of her friend, a five-year-old. The children awoke early and, without parental supervision, put on roller skates, went outside and tried to skate on the driveway. After having difficulty because of its dirt surface, the plaintiff saw her friend’s trampoline and, thinking it was a hard surface, tried skating on it. She rolled backwards and fell off. (She had not previously been on a trampoline.) Issue: What is the effect of the statutory provision under the enacted Civil Liability Act? Is this an obvious risk? Decision: The Court of Appeal held that the trial judge correctly adverted to the relevant sections of the Civil Liability Act 2002 (NSW). Liability was found on the basis that the reasonable householder ought to have folded up the legs of the trampoline, so that young children could not use it, thus preventing the potential risk of harm. The warning to not use it was insufficient. Further, contributory negligence was not found against the child, due to her age: see 10.13. The Act’s ‘obvious risk’ and ‘dangerous recreational activities’ provisions were not successfully relied upon by the defendant, because of the child’s age. The Court of Appeal held that matters such as the age, experience and personal characteristics of the person are to be

[page 574] taken into account in assessing what would be obvious to the ‘reasonable person in the position’ of the plaintiff — an objective test. The court stated (at [28]): … [S]ubs 5F(1) … requires consideration of the position of the person who suffers harm and whatever else is relevant to establishing that position. The characteristics of being a child of seven with no previous experience in the use of trampolines or roller skates, who chose to get up early in the morning and play unsupervised, is part of that position.

Additional examples of cases considering these provisions follow, illustrating how the provisions have been applied in a range of circumstances, with a close examination of the facts and relevant risk: •

Waverley Council v Ferreira (2005) Aust Torts Reports ¶81-818; [2005] NSWCA 418: a 12-year-old died when he fell through the ‘soft’ plastic panel of a skylight in the roof of a community centre in the Kimberley Reserve. His father brought a claim for the mental harm he suffered due to his son’s death. The court held that youngsters like this 12-year-old do not perceive danger in the same way as do adults; it was not an ‘obvious risk’. Children had frequently climbed onto the roof and the council knew or ought to have known this. As was the case in Doubleday, the age, experience and personal characteristics of the child were relevant to the objective assessment of the allegedly ‘obvious’ risk.

•

CG Maloney Pty Ltd v Hutton-Potts [2006] NSWCA 136: according to Santow JA (at [6]), the plaintiff ‘[s]lipped while walking on a recently polished hotel floor, on which some unbuffed liquid polish lay hidden’. Nearby, a cleaner was polishing the floor. A warning sign (likely obscured) was not seen by the plaintiff. McColl and Bryson JJA held that this was not an ‘obvious risk’ under the Act, as the substance on which the plaintiff slipped was not readily visible. She did not slip because of recent polishing (which might be characterised as an obvious risk). Rather, her injury was caused by the presence of material on the floor that could not be seen and

had not been removed by buffing — which was not an ‘obvious risk’. •

Smith v Perese [2006] NSWSC 288: a motor boat ran into the plaintiff while he was in the water spearfishing, as a result of which he had to have a below-the-knee amputation. Having considered all the circumstances, the court held that the driver of the boat was in breach of his duty of care, as he had not kept a proper lookout (bearing in mind the wind, visibility and precise location of the incident). The court held that the voluntary assumption of risk defence could not be sustained and this was not an ‘obvious risk’ under the New South Wales Act (at [78]): his perception with respect to safety was that he was fishing, with company, using a float (appropriate equipment), in good conditions; it was a familiar area, well known as one used for spearfishing, near the shore. This could not be characterised as a risk of which he was aware. Further, he had not voluntarily consented to being exposed to the risk that materialised. [page 575] The court also considered whether or not this was a ‘dangerous recreational activity’ under the Act (see 11.31).

•

Carey v Lake Macquarie City Council (2007) Aust Torts Reports ¶81874; [2007] NSWCA 4: early one morning, a 54-year-old cyclist rode his bicycle in a park managed by the defendant, along a path he normally did not take; he injured himself when he collided with a bollard placed in the middle of the path. The New South Wales Court of Appeal unanimously found a breach, as the bollard had little practical usefulness but posed a great risk. Although the council was liable, the plaintiff was 50 per cent contributorily negligent. Two members of the court refused to consider the obvious risk statutory provisions (and voluntary assumption of risk defence), because, in their view, they had not been properly

pleaded and argued. However, McClellan CJ discussed these issues at length, citing cases such as Hutton-Potts on difficult questions regarding what risks the provisions are directed towards and Great Lakes Shire Council v Dederer (2006) Aust Torts Reports ¶81-860; [2006] NSWCA 101 (the High Court of Australia did not consider these issues: see 3.41). While McClellan CJ held this risk met the statutory definition of what is ‘obvious’, the defence failed because it could not be inferred that the plaintiff had voluntarily accepted the risk of colliding with unexpected objects on the bicycle path; not thinking about a risk is not the same as voluntarily accepting it. •

Angel v Hawkesbury City Council (2008) Aust Torts Reports ¶81-955; [2008] NSWCA 130: the plaintiff was walking along a footpath when she injured herself by tripping on the raised lip of a concrete slab, displaced by tree roots. Because tree branches had cast a shadow over the slab, the raised part was not readily observable. Reversing the trial judge, five judges in the New South Wales Court of Appeal unanimously found the council liable. Citing a number of authorities on how to interpret the ‘obvious risk’ statutory provisions, the court held that the trial judge erred in not highlighting the ‘circumstances’ of the relevant risk, whereby the shadow caused a deception with respect to the height differential among the slabs. The court stated (at [64]), ‘that differential was not observable even to a person exercising reasonable care for her own safety’, who was not familiar with this location. The shadow obscured the plaintiff’s view of the raised slab until it could not be avoided. It stated (at [74]): ‘In these circumstances, the risk of harm by tripping over the defective slab would not have been obvious to a reasonable person in the position of the appellant. It would have been neither apparent to nor recognised by such a person exercising ordinary perception, intelligence and judgment.’

•

Pollard v Trude [2009] 2 Qd R 248 (see 3.36): the ‘obvious risk’ provision under the Civil Liability Act 2003 (Qld) was considered in the context of a claimant who was injured after being hit by a golf ball, while playing golf.

•

Council of the City of Greater Taree v Wells [2010] NSWCA 147: this case, like Carey, involved a cyclist who was injured. Here, the front wheel of his bike collided with a metal chain that had been strung across a pathway leading to a [page 576]

park. The New South Wales Court of Appeal held that the council had breached its duty by not using a brightly coloured, visible chain or bollard to prevent vehicular access into the park. Further, the objective determination of whether a risk is obvious involves a consideration of the particular circumstances in which the plaintiff is situated, including the ‘plaintiff’s knowledge and experience of the relevant area and conditions’ (at [76], citing Ipp JA in Dederer and Santow JA in HuttonPotts). Here, there was a low-slung chain, whose colour blended with the concrete below it. It was strung across a path’s entrance, near a main street. Although the cyclist had ridden down this path before, on those occasions there had been no chain. The court held (at [79]): … [A]lthough a reasonable person in the position of the … [cyclist] could not expect that conditions along … the path would not change, a chain which may not be visible to a cyclist taking reasonable care, until a short distance before coming upon it, is not an obvious risk. … [A] reasonable person in the respondent’s position would not have concluded it was probable that a council in the appellant’s position would sling a chain across a pathway which, having regard to the colour of the chain itself and the surrounding environment, was not visible to cyclists or others travelling along the path at greater than a walking pace until shortly before coming upon it.

•

Harmer v Hare [2011] NSWCA 229: a car with bald tyres was driven by the ‘life-long friend’ of the car owner, because the owner was intoxicated. The driver was injured when he lost control of the car at a roundabout; it collided with a telegraph pole, impacting the driver’s side of the car, as a result of which the driver suffered ‘extremely severe brain injury’ (quoted at [4]). The passengers were not injured. The driver had no knowledge that the tyres had no thread. Questions of joint illegality and contributory negligence were raised (see 10.11, 11.45) as were ‘obvious risk’ arguments. The

court held that the facts did not support the contention that the plaintiff-driver ought to have been aware of any obvious risk associated with the defendant-owner’s car, as the defendant had intended to drive the car. There was no reason why the driver ought to have inspected the car. Whealy JA (with whom Beazley JA and Sackville AJA agreed) stated (at [230]), ‘the risk was not an obvious one in circumstances where the plaintiff simply had no idea that the tyres were bald. Consequently, s 5F [of the Civil Liability Act 2002 (NSW)] had no application to this situation’. •

Simmons v Rockdale City Council [2013] NSWSC 1431: the plaintiff sued the local city council (and the sailing club, the occupier), alleging negligence for failing to ensure that the boom gate was clearly visible to cyclists, despite it being part of a ‘popular route’ for cyclists. The trial judge, Hall J, held that the risk that materialised was not an ‘obvious risk of cycling’. The evidence indicated that as the plaintiff approached the closed boom gate, he thought that it was part of a fence in the background. The trial judge held that such a ‘perceptual trap’ could not be said to be an obvious or patent risk. Hall J also rejected the defendant’s contention that the plaintiff was engaging in dangerous recreational activity (see 11.29). In Rockdale City Council v Simmons (2015) [page 577] 70 MVR 256; [2015] NSWCA 102, in the New South Wales Court of Appeal, a number of other issues were argued, including the trial judge’s contributory negligence finding of 20 per cent; this was reversed on cross-appeal: see note at 10.32.

•

Fitzsimmons v Coles Supermarkets Australia Pty Ltd [2013] NSWCA 273 (see 10.32): Basten JA observed that ss 5G and 5H of the Civil Liability Act 2002 (NSW) could not logically apply. His Honour stated (at [6]–[7]): That the risk of slipping on a wet polished floor is obvious is not to the point,

unless the wetness is also obvious. In the present case, the respondent deemed it appropriate, correctly, to place warning signs with respect to the slippery floor. Clearly the risk was not ‘obvious’ absent the signs: nor was the Civil Liability Act intended to deal with the question of obviousness by reference to the adequacy of any warning which was appropriately given. [Section 5G] involves a reversal of the burden of proof. It could not assist the defendant in the present case, whether or not the risk was obvious, because it was common ground that the plaintiff did not see the warning signs and did not know the floor was slippery. Section 5H provides that a person in the position of the defendant does not owe a duty of care to warn of an obvious risk. Once it is held that a warning is required, implicitly because the risk is not obvious, the adequacy of the warning is to be determined by reference to questions as to breach. Those questions cannot be determined by reliance on s 5H, which is directed to the existence of the duty.

•

Livsey v Australian National Car Parks Pty Ltd [2014] NSWDC 232: by way of contrast to Simmons (considered above), here, the plaintiff hit her head on a lowering boom gate when walking out of the defendant’s car park. Taylor SC DCJ held that the risk of being hit by the lowering boom gates was ‘obvious to a reasonable person’ and one about which the plaintiff was presumed to be aware (at [15]).

•

Holroyd City Council v Zaiter [2014] NSWCA 109: in March 2008, the respondent, then a nine-year-old boy, was playing with his sister and a friend in a sports ground when he rode his bicycle (which he had received as a birthday present a week earlier) down a grassed slope and into a concrete drainage channel, sustaining brain injuries. The sports ground was under the care and control of the council, but under the management of a separate committee, which had written the appellant a letter concerning a ‘fall hazard’ about six months before the accident. While the appellant did not act on the letter before the accident, it did fence the canal in May 2008, still unaware of the respondent’s accident. Hoeben JA (Emmett and Gleeson JJA agreeing) upheld the trial judge’s finding that the defence relating to ‘obvious risks of dangerous recreational activities’ (see 11.29) could not be successfully invoked: a reasonable nine-year-old would not have appreciated the steepness of the slope, the potential for losing control, or the existence of a concrete lip at the end of the slope, with a 2-metre drop to a bare

concrete base at the bottom of the channel. Despite the fact that his 10-year-old sister had alighted from her bike, the court observed (at [66]) that [page 578] the class of ‘boys who have just turned 9 … is notorious for its lack of maturity and unpredictable risk-taking behaviour’. Further, (at [67]) ‘the fact that one child behaved in a cautious manner on this occasion does not mean all children of a similar age should be expected to behave in the same way’, particularly because there was a significant difference in the levels of maturity of a boy who had just turned nine and a girl who was one year and two months older. The court held that the presence of the channel was not an ‘obvious risk’. Hoeben JA also rejected the argument that riding an unfamiliar bike down a grassy slope could be objectively characterised as a dangerous recreational activity (see 11.29). He distinguished bicycle races and busy roads, where riding a bicycle without a helmet could be considered a dangerous recreational activity, noting (at [91]) that ‘[t]he risk which eventuated here was not a fall off the bike, but falling a distance of 2 metres into an unfenced concrete channel’. •

Jackson v McDonald’s Australia Ltd [2014] NSWCA 162: the appellant visited McDonald’s with a colleague early in the morning after finishing work. Having entered from the street, they had to climb nine stairs to reach the service counter. On their way out, the appellant slipped on the floor, which had recently been mopped; he fell, sustaining injuries. He brought an action against McDonald’s as occupier, and the insurer of the company that provided cleaning services at the premises. Barrett JA of the New South Wales Court of Appeal (Ward JA agreeing on this point) held that the risk of ‘slipping because of wet soles’ was an obvious risk because the presence of a ‘cone’ warning that cleaning was in progress and the smell of cleaning fluid were sufficient to alert the appellant to the

fact that cleaning was ongoing and that the floor might be wet. Therefore, because the risk was ‘obvious’, McDonald’s did not have a duty to warn the appellant of the risk of slipping. However, this finding was not relevant to the alleged breach. Barrett JA (Ward JA agreeing, McColl JA dissenting on this point) found that McDonald’s had breached its duty by failing to prevent the risk of slipping by using the simple precaution of mopping the floor in sections. However, the court unanimously dismissed the appeal because the appellant failed to prove causation. According to the court (at [121]), the plaintiff was unable to prove that ‘water on his shoes, if present, would have caused, on the particular floor surfaces, slipping that would not have occurred if no water had been present’. •

Windley v Gazaland Pty Ltd t/as Gladstone Ten Pin Bowl [2014] QDC 124; BC201441540: the plaintiff suffered a fractured hip after slipping and falling on a slippery bowling lane surface at the defendant’s bowling alley. The lights had been dimmed for ‘glow in the dark bowling’, as a result of which the plaintiff could not see the ‘foul line’ marking out the slippery surface of the lane. Smith DJC rejected the argument that the risk of slipping over the foul line was an ‘obvious risk’ under the Civil Liability Act 2003 (Qld): ‘Under normal conditions ie with normal lighting the risk would have been obvious, but bearing in mind the conditions under which she bowled, the risk would be concealed’ (at [176]). Further, the plaintiff proved that she was not aware [page 579] of any obvious risk at the time. Smith DJC also held that the plaintiff, who had experience with ten pin bowling, was 40 per cent contributorily negligent as a result of failing to take more care with respect to where she stepped while bowling.

•

Collins v Clarence Valley Council [2015] NSWCA 263; (2015) 91

NSWLR 128; [2016] ALMD 4615: the appellant, an experienced cyclist, fell off her bicycle and suffered serious injury after her bicycle’s front tyre became wedged in a gap between the planks of a bridge maintained by the defendant council. McColl, Macfarlan and Emmett JJA of the New South Wales Court of Appeal held that the risk of injury as a result of bicycle tyres getting stuck in the gaps in the planks in the bridge was an ‘obvious risk’, having regard to the objective circumstances and experience of the plaintiff. •

Schultz v McCormack [2015] NSWCA 330: the appellant suffered a fractured ankle and soft tissue injuries after slipping on the top step of the verandah of the respondents’ home. She claimed that they had been negligent by failing to warn her that the verandah tiles were unusually slippery when they became wet and that the tiles were likely to be excessively slippery since they had become wet due to earlier rainfall. In the New South Wales Court of Appeal, McColl JA (Macfarlan JA and Beech-Jones J agreeing) held that in the circumstances, the risk of slipping, having regard to the poor lighting and shape of the awning, resulting in the pooling of water at the top of the landing, was not obvious and a reasonable person ought to have provided a warning. Further, the appellant was not contributorily negligent.

•

Schuller v SJ Webb Nominees Pty Ltd [2015] SASCFC 162: the appellant was injured when she fell off a chair she was dancing on while inebriated at the respondents’ hotel. She argued that the venue had been negligent in selling her too much alcohol and failing to prevent her from dancing on the chair. Dismissing her appeal for a number of reasons, Stanley J (Gray and Lovell JJ agreeing) of the South Australia Supreme Court Full Court considered which elements of the voluntary assumption of risk defence were subject to statutory onus of proof reversals, referring to context, legislative intention and the Ipp Panel Report. The court held (at [54]) that it was open on the evidence to find that, in accordance with s 37(3) of the Civil Liability Act 1936 (SA), the appellant had ‘consciously adverted to the possibility that the risk

of falling from the chair might eventuate, and decided to dance on the chair while affected by alcohol regardless’. •

Ireland v B & M Outboard Repairs [2015] QSC 84; [2015] ALMD 2933: the defendants ran a business that repaired outboard marine engines. In 2003, they had performed some work on the plaintiff’s boat. In 2006, the boat caught fire when the plaintiff attempted to engage the ignition to start the outboard motor, resulting in injury. North J found that the ‘risk of fire or explosion with consequent personal injury was [not] obvious either to a reasonable person in the position of the plaintiff … or to the plaintiff’ (at [82]). The risk was only [page 580] well known to people with detailed knowledge of engines and fuel systems; it was not a matter of common knowledge.

•

Blakemore v Moore [2015] NSWDC 9: the plaintiff suffered injuries after she tripped over some crushed terracotta tile that had migrated from the nearby garden bed to the car park behind the place where she worked. The action failed, with Mahony SC DCJ finding that no relevant duty of care was owed and (at [105]), ‘the crushed tile … was clearly an obvious risk. It was a red terracotta colour, and therefore contrasted to the concrete surface of the car park. Further, its presence was well known to the plaintiff, who had never complained about the presence of the material to her employer or, for that matter, to the defendant … who she saw often at the rear of the premises’.

•

Viscardi v Hornsby Shire Council [2015] NSWDC 19 (trial); [2015] NSWCA 417; (2015) 214 LGERA 311; [2016] ALMD 3469 (appeal): the plaintiff suffered injuries when he tripped and fell after losing his footing in a depression in the bitumen paving of the surface of a car park, owned and occupied by the council. At trial, Levy SC DCJ held that the council had been negligent in carrying out its

restoration of the bitumen patch and held (at [134]) that the risk of falling as a result of the defect in the bitumen was not an obvious risk: [Such a defect] could only have been obvious to the plaintiff if he actually knew that the defect was there (which is not the case here), or if the defect was observable to a reasonable person in the position of the plaintiff when traversing the area. Obviousness is a characteristic that must be viewed in context. Here, the context was the absence of prior knowledge of the defect and poor lighting conditions.

Dismissing the defendant’s appeal, Beazley P, Gleeson and Simpson JJA of the New South Wales Court of Appeal did not address the question of obvious risk. •

Guru v Coles Supermarkets Australia Pty Ltd [2016] NSWDC 349: the plaintiff brought an action against the supermarket after slipping on a grape at the defendant’s premises, sustaining multiple injuries. Levy SC J (at [88]) rejected the argument that the risk of falling as a result of slipping on ‘spillages of fruit or vegetable matter on the floor’ was an ‘obvious risk’. His Honour stated (at [87]–[94]), ‘as the plaintiff walked towards the produce shelves, she had applied her visual attention to the displays of merchandise for sale … I consider that a reasonable person in her position would have done the same … At that time, she was looking for items to select and place in the shopping basket she was carrying. This was the very purpose of her presence in the store and an activity the defendant had anticipated its customers would follow’. Further, ‘it was reasonable for a person in her position to assume that whilst her attention was being directed to displays of merchandise, she could not also be looking for spillages of fruit or vegetable matter on the floor. … [I]n this factual context, the plaintiff’s evidence of not having looked at the floor before she fell, was not a matter that should be regarded as forming the basis for finding that there was an obvious risk within the meaning of s 5G or 5H. … [A] reasonable person in the position of the plaintiff at the time, would have done the same as she had done’.

[page 581] •

Vo v Tran [2016] NSWSC 1043; [2016] Aust Torts Reports ¶82-299: the plaintiff suffered injury when her hand was caught in a juicing machine at the defendant’s premises. She had been helping to clean the premises when she slipped and her left hand entered the part of the machine that was usually used to crush sugar cane. Hall J held (at [138]), ‘the risk of injury … was not an obvious risk. It was the result of a combination of circumstances including the slippery floor, the machine being left on and the lack of a safety guard on the machine. It was not a risk that ‘was or would have been apparent to a reasonable person in the position of the plaintiff’. Case Example Queensland v Kelly [2015] 1 Qd R 577; [2014] QCA 27 Facts: A 22-year-old Irish tourist in Australia, who had not been exposed to sand dunes, was staying at a hostel. The hostel was required to show tourists a video prepared by the defendant (appellant), the Queensland National Parks and Wildlife Service, which included information about risks on Fraser Island. Although the video had warnings about entering streams and shallow lakes, there was no reference to steep sand dunes and the dangers of running up and down them, nor of the risk of doing so near Lake Wabby (noted by the court at [10] as ‘an attractive enticement to hot walkers’). The plaintiff (respondent) and his friends (like many other visitors) repeatedly ran up and down the sand dunes and into the water. He was rendered tetraplegic as a result of the way he fell into the water on the last run up and down a sand dune. There was a sign warning of the shallow nature of the lake but he had not studied it closely. The trial judge found the Service liable and the plaintiff 15 per cent contributorily negligent. Issue: Was the risk of injury in these circumstances ‘obvious’ under the Civil Liability Act 2003 (Qld) s 13? Decision: The Supreme Court of Queensland, Court of Appeal affirmed the trial judgment. Fraser JA noted (at [17]) that ‘[t]here was a long history of serious injury to visitors at Lake Wabby. … In the 17 year period before the respondent was injured 18 incidents were recorded, many of which involved serious spinal injuries’. His Honour referred to the trial judge’s reasoning, which included the observations that the risk of serious injury was not apparent to a notable percentage of visitors to the lake, the plaintiff was young, not experienced with dunes, had not been to the lake previously

and had seen many others do as he did without incident, as he himself had done on several occasions. Fraser JA endorsed (at [43]) the trial judge’s determination that the risk that materialised was not an obvious one under s 13 of the Civil Liability Act and ‘the signs did not effectively communicate that running down the dune into the lake involved the risk of serious injury which materialised’. Citing cases such as Fallas v Mourlas (2006) 65 NSWLR 418 and Council of the City of Greater Taree v Wells (2010) NSWCA 147, Philippides J observed (at [57]) that [page 582] ‘the determination [of obvious risk under the Act] is an objective one, having regard to the particular circumstances in which the person was in, including, for example, the person’s knowledge and experience of the relevant area and conditions’. He concluded (at [58]): The risk of injury that materialised … the risk of serious injury from an accident caused by running down the sand dune into the lake, was not a risk that in the circumstances would have been obvious to a reasonable person in the position of the respondent. At [50], the court also held that ‘[t]he finding of contributory negligence is not in conflict with the finding that the risk which materialised was not an “obvious risk”’. The knowledge he had gained in his previous runs down the dune was relevant to his departure from the standard of care of a reasonable person in failing to take notice of the warning signs (at [53]).

No need to warn about obvious risks under some Civil Liability Acts 11.28 Associated with the ‘obvious risk’ provisions under several Civil Liability Acts are sections that consider warnings. For example, the New South Wales Civil Liability Act 2002 prescribes: A person (the defendant) does not owe a duty of care to another person (the plaintiff) to warn of an obvious risk to the plaintiff.4

However exceptions with respect to warnings exist in cases where: (i)

the injured person has requested information or advice about the risk from the defendant; or (ii) a written law requires the defendant to warn of the risk; or (iii) the defendant is a professional providing a professional service

where there is a risk of injury or death. (This exception does not apply to doctors in Queensland and Tasmania: see Civil Liability Act 2003 (Qld) s 15(2)(c) and Civil Liability Act 2002 (Tas) s 17(2)(c); in contrast, South Australia limits the application of this exception to the provision of health care services: see Civil Liability Act 1936 (SA) s 38(2)(c)). Several examples follow: •

Jaber v Rockdale City Council (2008) Aust Torts Reports ¶81-952; [2008] NSWCA 98: the New South Wales Court of Appeal gave effect to the ‘no duty to warn of an obvious risk’ provision. In that case, a 19-year-old dived head first from a bollard or pylon on a wharf into the sea, sustaining severe injuries as a result of hitting his head on the seabed. This was also characterised as a ‘dangerous recreational activity’ (see 11.29, 11.31). The court held this was an ‘obvious risk’ under the Act, stating (at [39]–[40]): [page 583] The fact that the appellant believed that the water was deep enough, because he had purported to check its depth by treading water, does not militate against a finding on the objective facts that there was an ‘obvious risk’ that would be readily apparent to a reasonable person in the appellant’s position. A reasonable person in the position of the appellant, wishing to dive headfirst from the top of a bollard, two to three metres above the surface level of the water, would not regard that method, if it be such, as a reasonable substitute for testing the depth by the more reliable means of ‘duck diving’ or by jumping feet first. … [T]he relevant risk of harm to which the appellant was exposed was one which was an ‘obvious risk’ … By virtue of s 5H(1) it follows that the Council did not owe a duty of care to the appellant to warn him of that risk.

•

Liverpool Catholic Club Ltd v Moor [2014] NSWCA 394; (2015) Aust Torts Reports ¶82-199: visiting an ice skating rink on the defendant’s premises, the respondent was descending stairs in order to access the rink. He slipped on a step, fell and fractured his ankle. Meagher and Emmett JJA and Tobias AJA held (at [4]) that ‘the difficulties in descending the stairs in [ice-skating] boots would

have been readily apparent to a person in the respondent (plaintiff)’s position’. Even though he was 18 and a relatively inexperienced skater, the fact that he was wearing large skating boots whose blades were longer than the tread of the stairs and that his only contact with the stairs’ surface was with the skate blade (resulting in balance difficulties) meant that the risk of falling should have been obvious. The court held (at [52]) the appellant did not have a duty to warn of this risk and descending the stairs in skating boots was not ice skating and was not a dangerous recreational activity (at [56]) (see 11.29, 11.31). •

Price v Southern Cross Television (TNT9) Pty Ltd [2014] TASSC 70; (2015) Aust Torts Reports ¶82-208: while participating in filming a television series, ‘Discover Tasmania’, the plaintiff jumped off a 13metre cliff into a body of water and suffered back injuries when her body hit the water’s surface. The plaintiff failed to prove that the defendants owed her a duty of care. Porter J also held that ‘the risk of harm by impact with the water by jumping from the cliff was an obvious risk’, such that the defendants did not have a duty to warn the plaintiff of the risk (at [213]). Even if the defendants did owe a duty of care, the defendants would have successfully established that the plaintiff voluntarily accepted the risk of injury (at [221]). Porter J also held that the defendants would be absolved from liability because jumping off a cliff is a ‘dangerous recreational activity’ (at [226]).

•

Safar v Sutherland Shire Council [2016] NSWDC 232: the plaintiff slipped on wet parquetry flooring, severely fracturing her ankle, when attending a concert in an auditorium owned, occupied, managed and hired out by the council. Levy SC J held that the floor’s wet and slippery condition was an ‘obvious slipping risk’ such that the defendant did not have a duty to warn the plaintiff of the slipping danger posed by the floor’s wet condition (at [115]). In the circumstances, the plaintiff had known that the floor was wet from the ‘water that had been

[page 584] dropped or dripped from umbrellas, raincoats or bags brought into the premises in circumstances where there were no cloakroom facilities, and no umbrella drying or storage facilities’ (at [121]). As such, it was ‘obvious to a reasonable person in the position of the plaintiff’ that there was a risk of slipping on the floor (at [122]). Nevertheless, his Honour held that the defendant was liable, but that the plaintiff was 20 per cent contributorily negligent for failing to take care to not step on or walk in the wet parts of the floor.

Dangerous recreational activities: under some statutes 11.29 Not surprisingly, given the underlying rationale for the changes to tort law recommended by the Ipp Panel, several states — New South Wales, Queensland, Tasmania and Western Australia — gave special attention to ‘dangerous recreational activities’.5 Although some of the detail in the legislation differs, in general terms, the defendant is exempt from liability if the plaintiff engages in a dangerous recreational activity and suffers harm as a result of the materialisation of an ‘obvious risk’ in that activity, whether or not the plaintiff was aware of the risk (but not, in Western Australia, if the plaintiff requested advice or information from the defendant: Civil Liability Act 2002 (WA) s 5H). A dangerous recreational activity is comprehensively defined in New South Wales and in similarly elaborate terms in Western Australia.6 It ‘involves a significant risk of physical harm’ and includes: • •

any sport (organised or not); a pursuit or activity engaged in for enjoyment, relaxation or leisure.

It includes activities engaged in: • •

at the beach, park, or

•

‘other public open space’,

where people ordinarily engage in sport or in any pursuit or activity for enjoyment, relaxation or leisure. Although the definitions in Queensland’s and Tasmania’s statutes are similar in intent, they are less detailed.7 It is likely that the defendant in a case like Nagle v Rottnest Island Authority (1993) 177 CLR 423; 112 ALR 393 would be protected from suit in all four states if these Acts had been in force (see 3.33: in Nagle, the plaintiff hit his head on a submerged rock as a result of diving into a natural swimming pool. In a controversial decision at common law, he succeeded in his claim). [page 585] 11.30 In New South Wales and Western Australia,8 if a person who engages in a recreational activity — and not just a dangerous one — is warned of an activity-associated risk, no duty of care is owed to that person with respect to that risk. Indeed, constructive knowledge of the warning is sufficient for it to be effective. Furthermore, a general warning of risks that includes the particular risk is sufficient. Exceptions are made with respect to the effectiveness of warnings relied on by defendants in cases involving ‘incapable persons’ or ‘incompetent persons’ — young people or persons with disabilities, who lack the capacity to understand the risk warning. 11.31 The term ‘dangerous recreational activity’ has been subject to frequent interpretation. Once again, this arises most often, but not solely, in the context of the New South Wales statute. Examples include the following: •

Falvo v Australian Oztag Sports Association (2006) Aust Torts Reports ¶81-831; [2006] NSWCA 17: the New South Wales Court of Appeal stated that the phrase must be read as a whole, and ‘due weight’ must be given to the word ‘dangerous’, and the term ‘significant’ is

relevant to the risk as well as the physical harm (at [28]): … the phrase ‘significant risk’ cannot properly be understood without regard being had to the nature and degree of harm that might be suffered, as well as to the likelihood of the risk materialising.

Having noted that Oztag is not meant to be a sport involving physical contact, Ipp JA continued (at [33]): A ‘dangerous recreational activity’ cannot mean an activity involving everyday risks attendant on games such as Oztag, which involve a degree of athleticism with no tackling and no risk of being struck by a hard ball. In my opinion, the trial judge erred in finding that Oztag was ‘a dangerous recreational activity’.

Ultimately, the plaintiff’s claim failed because he could not establish causation. •

Fallas v Mourlas (2006) 65 NSWLR 418; [2006] NSWCA 32: the same court considered this provision in the context of ‘spotlighting’ — shooting kangaroos at night with the aid of a spotlight. During the course of a hunt, the defendant accidentally shot his friend in the leg; his friend was in the car with the spotlight when he was shot. Two of three judges held that this was a ‘dangerous recreational activity’ within the terms of the New South Wales statute, as it involved an activity in which there was a clear capability of ‘significant risk’ of physical harm (based on the circumstances, including the participants’ inexperience): the court held that a ‘significant risk’ lies between a risk that is trivial and one that is likely to materialise. However, a differently constituted majority in the same case held that the defendant’s appeal failed. The defendant had given assurances to his friend that the gun was unloaded; [page 586] in fact, the shooting occurred due to his grossly careless conduct. Such extreme carelessness did not constitute an ‘obvious’ risk.

•

Lormine Pty Ltd v Xuereb [2006] NSWCA 200: the plaintiff went on a

dolphin-watching cruise. She had read a brochure which described an excursion onto ‘calm ocean waters’. Once at sea, she took up the captain’s invitation to passengers to go to the foredeck. The force of a ‘rogue wave’ (greater than one metre high) crashed over the ship, slamming her back against the bow, causing her serious injuries. The New South Wales Court of Appeal upheld the lower court’s finding against the captain (and owner). Although the ship was in the ‘wave zone’, the captain had not kept a proper lookout for the wave. Despite the fact that the plaintiff had signed a form that purported to waive liability, the contractual defence failed for several reasons, including ambiguity. Moreover, she had thought it was merely intended for ‘head count’ purposes. The court also held that ‘obvious risk’ and ‘inherent risk’ provisions were not satisfied. Citing Falvo v Australian Oztag Sports Association and Fallas v Mourlas, the court held that this was not a ‘dangerous recreational activity’. It observed that to establish this statutory defence, the defendant bears the burden of proof. Its requirements are: — it must be determined ‘objectively and prospectively’; — the standard of a significant risk lies between a trivial one and one that is likely to occur; — ‘significance’ attaches to the risk and harm; — the particular context in which the plaintiff placed herself is important. Here, the brochure wrote of a ‘gentle activity’. The court stated (at [32]): There was nothing to suggest to the reasonable reader that the particular vessel would go as close to the wave zone or generally into conditions where getting swamped was one of the expected thrills of the cruise.

•

Smith v Perese [2006] NSWSC 288 (see 11.27): while spearfishing was considered by Studdert J to be a ‘recreational activity’, it was not ‘dangerous’; therefore, the statutory defence could not be enlivened. The court held that to assess dangerousness, all the circumstances in which it is undertaken must be evaluated: sometimes spearfishing may be dangerous and sometimes it may not be. Here, in 10 years, the plaintiff had never been injured while

engaged in this activity; he was in good health, had proper equipment, fished with company and was near the shore. The court decided (at [89]), in these circumstances, that there was no ‘significant’ risk of physical harm to the plaintiff and his injury was not the result of the materialisation of an obvious risk of spearfishing. •

Jaber v Rockdale City Council (2008) Aust Torts Reports ¶81-952; [2008] NSWCA 98 (see 11.28): the court stated (at [45]) that diving into the sea, as on these facts, came within the statutory definition. The risk of physical harm in the circumstances was not trivial; there was a real chance the risk would materialise [page 587] if the plaintiff misjudged the water depth (as he did); the nature of the harm that could be sustained was very serious (‘catastrophic’). The council was not liable, because the plaintiff’s spinal injuries were a ‘result of the materialisation of what was an obvious risk of a dangerous recreational activity engaged in by him’ (at [55]).

•

Nicol v Whiteoak (No 2) [2011] NSWSC 1486: the plaintiff was a passenger in a motor boat driven by the deceased (and owned by the deceased’s son); the deceased’s executor was the first defendant. The deceased had been driving the unlit boat at dusk, at approximately 80 kilometres per hour. The motor boat collided with an illuminated half-cabin cruiser, driven by the second defendant at about 35 kilometres per hour. The plaintiff-passenger had no recollection of the accident, due to the head injuries she suffered in the collision. The deceased had been drinking and had traces of marijuana in his blood. He died from injuries sustained in the collision. The first defendant asserted that the plaintiff’s harm was the materialisation of an obvious risk in a dangerous recreational activity. As the court noted, various levels of generality can be employed to assess the recreational activity under review.

Here, while the deceased may have been engaged in a dangerous recreational activity by being in charge of a motor boat without lights on and under the influence of alcohol and drugs, this did not mean that the passenger was also engaged in such an activity. On the evidence, the defendant had not discharged the burden of establishing this defence under the Act. Because the first defendant had not proven on the evidence that the plaintiff had freely and willingly accepted the relevant risk, volenti non fit injuria also failed. •

Vreman v Albury City Council [2011] NSWSC 39: two BMX bike riders brought claims against the council, which had painted concrete surfaces of the local skate park so that it could remove graffiti fairly readily. One rider was severely injured when he fell from his bike while attempting a jump; the other was injured when he fell from his bike while riding down the centre ramp. They asserted that their falls were caused by the paint, which made the skate park’s condition slippery and dangerous. Harrison J, of the New South Wales Supreme Court, disagreed, detailing the kinds of jumps undertaken by these riders and citing several leading decisions to support his conclusion. While his Honour noted that not every form of cycling is a dangerous recreational activity, he stated (at [87]) ‘upon the basis of my observations from a purely untrained and unskilled perspective, performance of these manoeuvres is not for the faint-hearted’, concluding that this was ‘objectively and prospectively a dangerous activity’. He stated (at [102]): The reasonable person in the position of Mr Vreman must be taken to have ridden on the painted surface of the skate park many times and to have been able to form his or her own conclusions about its suitability for riding upon in those circumstances. Similarly, the reasonable person in the position of Mr Morris must be taken to have had knowledge that Mr Vreman had been injured because his bike wheel reputedly slipped on the painted surface and

[page 588] also to have been able to form his or her own conclusions about its suitability for

riding upon in those circumstances. The risks would have been obvious to a reasonable person in the position of each man.

Harrison J also held that the Council did not breach its duty to the plaintiffs by painting the skate park and causation could not be established or inferred (assuming breach had been proven). On the latter point, Harrison J stated (at [143]) ‘the difference between the painted surfaces and the unpainted surfaces are accompanied by too many other uncertain but possible causes of the accidents’. •

Hume v Patterson [2013] NSWSC 1203: the plaintiff was wakeskating on the Tweed River when he fell and hit his head, suffering tetraplegia as a result. He sued the driver of the boat that was towing him, claiming that the driver was negligent when he drove the boat outside the navigation channel, causing the plaintiff to strike his head on a sandbar when he fell. Campbell J found that the defendant had breached his duty by failing to navigate the boat wholly within the channel while he was towing the plaintiff. His Honour rejected the argument that wakeskating was a ‘dangerous recreational activity’, noting (at [134]) that this sort of inquiry had to be conducted at an ‘appropriately detailed level of abstraction’. The wakeskating was meant to be conducted in relatively deep water at a relatively low speed (compared to other types of waterskiing) and the plaintiff, while a novice at wakeskating, had experience with other water sports such as wakeboarding. Further, the evidence did not support the contention that this sport involved a significant risk of physical harm. Campbell J held (at [135]) that ‘the risk of the relevant causative factors combining to produce catastrophic injury if the plaintiff had fallen in identical circumstances in the channel was so low to justifiably be put to one side as not “significant”’. His Honour also held that even if wakeskating was a dangerous recreational activity under the Civil Liability Act 2002 (NSW) s 5L, the risk of serious injury was not ‘obvious’ under s 5F, noting (at [141]) that ‘on the basis that the activity was to be carried on wholly within the channel, a reasonable person in the position of the plaintiff (or of the defendant for that matter) would have been justified in putting the

risk to one side as insignificant or trivial’. •

Watson v Meyer [2013] NSWCA 243: the appellant and respondent, then a de facto couple, were riding their respective horses on the appellant’s property when the respondent’s horse became aware of a mare (who was in oestrus) in the paddock. The horse charged towards the mare, attacking the appellant in the process, and causing her serious injuries. The appellant claimed that the respondent, a ‘horse expert’, had been negligent in his instructions to the appellant to stop his horse. The respondent argued that the appellant had been contributorily negligent by failing to inform him that the mare was in season. On appeal, Ward JA of the New South Wales Court of Appeal (Gleeson and Macfarlan JJA concurring) noted (at [82]) that for the defence to be operative, the risk of riding into a paddock containing a mare in season must be one which would have been obvious to a reasonable person in the position of the [page 589] plaintiff, when regard is had to the particular circumstances in which the risk materialised. The court further noted (at [82]) there was a ‘difference between the obvious risk of suffering an injury while horse-riding through a fall and the risk of being attacked by a runaway stallion’. The case was remitted to the District Court for a re-trial.

•

Streller v Albury City Council [2013] NSWCA 348: the respondent council had organised Australia Day events in the Noreuil Park foreshore area. The appellant, then 16 years old and an ‘accomplished diver’, attempted a back flip using a rope that was attached to a tree overhanging the Murray River. The court noted (at [2]) that this complex manouevre ‘involved the appellant swinging in an arc over the river whilst facing the riverbank, releasing his grip from the rope towards the top of that arc whilst

still facing the riverbank, and then performing a 360 degree back flip in the air so as to land feet first in the water’, with a point of release likely to have been over six metres above the water’s surface. The appellant landed awkwardly on the riverbed, suffering a C7 quadriplegia injury. Applying a large number of leading authorities, Meagher JA of the New South Wales Court of Appeal (Ward and Emmett JJA agreeing) affirmed the trial judge, holding that the council was not liable because the harm suffered by the appellant was a materialisation of an ‘obvious risk’ of a ‘dangerous recreational activity’. His Honour held (at [33]) that the risk of being injured upon impact with the riverbed would be ‘obvious to an optimistic, but not foolhardy, and athletic 16 year old with the life experience of the appellant, [including] swimming and diving in pools and rivers from a relatively young age’. Meagher JA also agreed with the primary judge that the use of the rope swing was a ‘dangerous’ recreational activity, which presented the risk of ‘potentially catastrophic’ and ‘serious’ physical harm, particularly where the plaintiff had failed to check the depth of the water before jumping in. •

Campbell v Hay [2014] NSWCA 129: the appellant, who was taking flying lessons from the respondent, sustained injuries when an engine failure resulted in a forced landing in a paddock. He claimed that the respondent had been negligent for failing to ensure that the aircraft was only flown in areas that could be used as suitable landing strips in an emergency, particularly following two sets of engine vibrations that suggested that the engine might be problematic. Ward JA of the New South Wales Court of Appeal (Meagher and Barrett JJA agreeing) dismissed the appeal. Aside from reversing the trial judge’s findings that breach had been established (and causation, implicitly), Ward JA went on to consider defences. Citing Fallas v Mourlas and Falvo v Australian Oztag Sports Association, Ward JA upheld the trial judge’s finding that undertaking flying lessons in that particular type of aircraft was a ‘dangerous recreational activity’ that involved a ‘significant risk of physical harm’ that could not be considered ‘trivial’. His

Honour further dismissed the appellant’s argument that what materialised was not an obvious risk within the meaning of s 5F of the Civil Liability Act 2002 (NSW), holding (at [149]) that ‘it must have been obvious to a person in the position of [the appellant] (an adult having his third [page 590] lesson in a single-engine light aircraft) that if the plane were to experience engine problems he would be reliant on [the respondent] to land the plane safely and that there was a risk that [the respondent] would not be able to do so or would, in an emergency situation, make an incorrect decision’. •

Alameddine v Glenworth Valley Horse Riding Pty Ltd [2015] NSWCA 219; (2015) 324 ALR 355; (2015) Aust Torts Reports ¶82-234: while being led by an instructor at the respondents’ recreational horse riding facility, the appellant, an 11-year-old girl, was injured after she fell off the quad bike she was riding. This occurred after the instructor accelerated his bike to catch up with group members who had begun to get further away from the rear group, leading the appellant to also accelerate and ultimately lose control of and fall off her bike. The appellant brought an action against the respondents alleging negligence and failure to comply with the Australian Consumer Law. The respondents had warned the appellant that the quad biking activity involved a significant risk of physical harm. They did so with a relevant warning in a clause in the application form (signed by the appellant’s sister, who misstated the appellant’s age as 12), which stated that the participant acknowledged that quad biking was a ‘dangerous recreational activity’. They also did so by virtue of a sign in the facility’s waiting area, which advised that quad biking was an ‘inherently dangerous activity’ and that individuals who went quad biking were doing so ‘entirely at [their] own risk’. However, the respondents also had held out quad biking to be ‘surprisingly easy’,

requiring no experience’ (at [20]). On appeal, Macfarlan JA (Simpson JA and Campbell AJA agreeing) stated that because quad biking was advertised as ‘surprisingly easy’ and that riders would receive a safety briefing, this meant that the activity was not a ‘dangerous recreational activity’. These considerations outweighed the ‘fine print’ on the application form that stated that participants who chose to go quad bike riding did so ‘entirely at [their] own risk’ (at [39]). In addition, it was held (at [43]) that s 5L was ‘also inapplicable because the [appellant]’s injury did not result from the “materialisation of an obvious risk” of the activity’: while it ‘would have been obvious to a reasonable person in the appellant’s position (even taking into account her age …) that significant injury might be suffered if that person, or another participant, were unable to properly control his or her quad bike … the risk of injury resulting from an instructor riding faster than was safe for inexperienced or young participants and effectively giving such persons no real choice but to also do so in order to keep up with him’ was not a risk inherent in or incidental to the quad biking activity. Macfarlan JA held that s 5M did not apply, because the risk that materialised was not inherent in or incidental to the activity. Section 5N also did not apply, because the exclusion of liability provided in the application form was provided after the contract was formed. This occurred on the previous day when the appellant’s mother had arranged and paid for the activity on behalf of the appellant. At the time of payment, there had been no discussion about [page 591] the application form forming part of the contract, and the application form itself ‘simply purported to waive liability without any consideration’ (at [52]).

It appears that the overall impression of the activity and what the respondents said about it on their website outweighed the explicit statement in the fine print of the application form that quad biking was a ‘dangerous recreational activity’. This is further illustrated in Rohra v Ox Two Pty Ltd (t/as Ocean Extreme) [2016] NSWDC 78, discussed below. •

Stewart v Ackland [2015] ACTCA 1; (2015) 10 ACTLR 207; 293 FLR 341; [2015] Aust Torts Reports ¶82-210: the plaintiff, a 21-year-old studying for a double degree in Arts/Law, joined a ‘Mystery Bus Tour’ with a number of other residential college members. This tour brought them to the defendant’s farm, on which they ran an amusement park that had a number of attractions, including a ‘jumping pillow’, a large inflatable pillow similar to a trampoline. After watching other members of the tour group attempt back somersaults, the plaintiff joined in and landed awkwardly on his ‘side and the belly’. Upon receiving more advice from friends he tried again, but landed heavily on his head at the bed of the jumping pillow, suffering a serious neck injury that resulted in quadriplegia. The trial judge held that performing back flips on the jumping pillow was a dangerous recreational activity, but that the risk of serious neck injury, in contrast to the risk of less serious harm, was not an ‘obvious risk’ within the meaning of the Civil Liability Act 2002 (NSW) s 5L, from the perspective of a reasonable person in the position of the plaintiff — ‘a 21-year-old with sufficient intelligence to study law at university and who was not inebriated’ (Ackland v Stewart [2014] ACTSC 18 at [298]). The Australian Capital Territory Court of Appeal unanimously dismissed the defendant’s appeal. However, Penfold J disagreed with Walmsley and Robinson AJJ with respect to the level of risk required for there to be a ‘significant risk of physical harm’ within the meaning of s 5K. Penfold J held that the risk of catastrophic harm in this case was so low that the activity would not have been prospectively identified as a ‘dangerous recreational activity’, while Walmsley AJ (Robinson AJ agreeing) held that the fact that the risk of catastrophic harm was ‘small but not trivial’ was sufficient for

the activity to be considered a ‘dangerous recreational activity’. The case was ultimately settled before it could be heard in the High Court: see [2015] HCA Trans 322. •

Sharp v Parramatta City Council [2015] NSWCA 260; (2015) 209 LGERA 220: the appellant suffered injury after landing awkwardly after jumping from the 10-metre diving platform at the swimming centre occupied by the council. Meagher JA (Ward and Gleeson JJA agreeing) dismissed the plaintiff’s appeal. In relation to s 5M, the court held that the warning sign at the base of the stairs to the diving tower had sufficiently identified the general nature of the risk of injury in jumping from the platform, since it had referred specifically to ‘using the platforms and springboards’ to jump and dive into the pool below. The court further held (at [41]) that the respondents were entitled to rely upon s 5L: the risk which ‘materialised and caused the appellant’s injuries was that of impact [page 592] with the water surface from a height and in an uncontrolled or unintended way’ was one that ‘would have been clearly apparent and understood by a reasonable adult in the appellant’s position’. Moreover, jumping from a 10-metre platform was held (at [42]), upon an ‘objective assessment of the riskiness of the activity, taking account of the probability of physical harm coming to pass and the seriousness of the harm which would or might then result’, to be a ‘dangerous recreational activity’, since it ‘carried with it a probability of harm that was real and present and the consequences of which included serious injury from impact with the surface of the water’.

•

Goode v Angland [2016] NSWSC 1014: the plaintiff, who was a jockey, brought an action against the defendant, a fellow jockey. The plaintiff had suffered catastrophic injuries after falling from his horse during a race and alleged that the defendant had been

negligent in ‘riding in such a manner as to cause interference to [the plaintiff] and his mount’ (at [2]). The plaintiff’s action failed. In obiter, Harrison J remarked (at [134]) that ‘both the risk that a rider might fall from a horse and the risk that serious injury might be caused by the fall are obvious risks of riding a horse in almost any situation’. Harrison J also held (at [136]–[146]) that professional horseracing fell into the scope of the definition of ‘dangerous recreational activities’ and that there was no reason why this definition should exclude professional sports. •

Rohra v Ox Two Pty Ltd (t/as Ocean Extreme) [2016] NSWDC 78: the plaintiffs were injured while riding on a motor vessel operated by the defendants. The plaintiffs had initially purchased tickets for a ride in Sydney Harbour on a separate jet boat, but they were informed by the defendants that that boat was not available and an alternative vessel known as ‘Extreme II’ was available. The plaintiffs agreed to take ‘Extreme II’. They suffered injury during the harbour tour. In relation to whether the harm suffered was an obvious risk of a dangerous recreational activity, Mahony SC DCJ held that it was not, stating (at [311]) that the ‘relevant risk of harm here was that each of the plaintiffs would suffer serious injury by virtue of the nature of the activity, namely, by going on a powerful speed boat which was designed to travel over waves at high speeds’ and that this risk was not obvious because one of the plaintiffs had expected ‘based on previous experience, that there was a cushion seat and harness’, while another plaintiff had ‘actually made enquiries as to the safety of the ride and was assured that it was safe and that the passengers would have harnesses’. Moreover, the court noted (at [311]–[312]) that the plaintiffs had not anticipated serious injury even if they had accepted the risk of some kind of injury, the defendants had not attempted to differentiate the activities involved on the ‘Extreme II’ as opposed to the jet boat that was unavailable and the defendants’ website had emphasised the ‘absolute safety involved in the activity’. The court also held that the activity was not a dangerous recreational activity, referring to the defendants’ website, which

had emphasised the ‘absolute safety’ of the activity. Alameddine was applied to emphasise the relevance of the defendants’ representation of the activity to the assessment of whether it was a ‘dangerous recreational activity’ (at [310]). [page 593] •

Whittington v Smeaton [2016] ACTSC 76; (2016) Aust Torts Reports ¶82-277: the plaintiff was acting as an observer on a jet ski driven by one of the defendants when the boat collided with another boat and the plaintiff fell into the water. The plaintiff’s leg became entangled in the tow rope, and his foot was amputated. The defendants — the owner and driver of the jet ski — argued that they were not liable because the plaintiff’s harm was the materialisation of an ‘obvious risk’ of a ‘dangerous recreational activity’, under s 19 of the Civil Liability Act 2003 (Qld). Mossop AsJ held (at [58]) that while it was clear that the plaintiff was engaged in a recreational activity, in the circumstances the plaintiff’s role, which involved assisting in communication between water skier and jet ski driver did not involve a significant risk of physical harm; his Honour continued, stating (at [61]) that this conclusion was ‘reinforced by the fact that the plaintiff participated in the activity on the basis that he would not get wet. This constituted a limitation on his participation … which qualified the nature of the activity so as to reduce any danger that might otherwise be involved’. It was further held (at [67]) that even if acting as an observer on a jet ski was to be considered a dangerous recreational activity, the risk which materialised, ‘that the plaintiff fell from the jet ski and became somehow entangled in the towrope trailing behind the boat’ was ‘far from obvious’, having regard to the plaintiff’s lack of boating experience and a combination of other circumstances. This plaintiff had been assured that he would not get wet and the activity was to be undertaken on calm water in a relatively uncrowded area.

Recreational services providers: under some statutes 11.32 The following brief comments highlight a few statutory provisions that place limits on the liability of recreational services providers. Largely driven by notions of the plaintiff’s personal responsibility, they seem quite misguided when regard is had to the unevenness in bargaining power in the relevant relationships. Several statutes allow recreational services providers to include (to a degree) waivers that restrict, modify or exclude terms of contracts that would otherwise have been treated as void (under other statutory provisions).9 In general terms, as described under the Commonwealth statute, ‘recreational services’ are sporting activities or similar leisuretime pursuits or any other activity that involves a significant degree of physical exertion or physical risk that is undertaken for recreation or enjoyment.10 This includes, for example, activities like bungee jumping and horse riding. [page 594] 11.33 In some jurisdictions, the ability to exclude liability is not available if the harm suffered resulted from contravention of a written law that establishes procedures for the protection of personal safety.11 Under South Australia’s and Victoria’s legislative regimes, the term modifying, restricting or excluding a guarantee otherwise implied in the contract must be brought to the attention of the consumer in advance. In South Australia, the consumer must agree to the term in advance (and in that state, the term can be brought to the attention of a third party for whom or on whose behalf the service is being acquired). 11.34 While the Commonwealth, South Australian, Victorian and Western Australian Acts permit recreational services providers to modify, limit or exclude liability for the breach of an implied term, waivers will not be effective if the conduct at issue was undertaken

with ‘reckless disregard’ (or lack of consciousness, in Western Australia) of the consequences.12 11.35 Section 5N of the Civil Liability Act 2002 (NSW) was considered in the following High Court of Australia case. Case Example Insight Vacations Pty Ltd v Young (2011) 243 CLR 149; 276 ALR 497 Facts: The plaintiff bought a tour package from the defendant (based in New South Wales). While on a coach, travelling from Prague to Budapest, she reached for a bag from the overhead shelf; the coach braked suddenly, and she injured herself. The following exemption clause was included in the contract with the plaintiff (cited by the court at [3]): Where the passenger occupies a motorcoach seat fitted with a safety belt, neither the Operators nor their agents … will be liable for any injury … arising from any accident or incident, if the safety belt is not being worn at the time … Issues: Could the defendant successfully rely on the exemption clause? What was the effect of s 5N of the Civil Liability Act 2002 (NSW)? Decision: The High Court of Australia (French CJ, Gummow, Hayne, Kiefel, Bell JJ) unanimously affirmed the lower courts’ decisions in favour of the plaintiff (respondent). It held (among other matters) that s 5N had a geographical limit; it only applied to contracts for the supply of recreational services in New South Wales. The court stated (at [27], [34]–[35]): Although the contract between Mrs Young and Insight was governed by the law of New South Wales it was to be performed wholly outside the State. … … [Section] 5N, in particular, is directed to limiting liability for negligence in relation to recreational activities … by permitting parties to contracts to stipulate effectively for the exclusion, restriction or modification of any liability to which the Division applies that results from breach of an express or implied warranty that the services will be rendered with reasonable care and skill. … [page 595] There is no reason to read those references to place as extending beyond places in New South Wales. Taken together, ss 5J(1) and 5K point decisively to reading s 5N as reaching all cases in which the contract in question (wherever it is made and by whatever law it is governed) is for the supply of recreation services in New South Wales.

Narrowly interpreting the exemption clause, the court stated (at [9], [38]–[39]): … [O]n its true construction, the exemption clause did not apply to the events that happened. … … [I]t should be read as referring only to times when the passenger is seated, not to times when the passenger stands up to move around the coach or to retrieve some item from an overhead shelf or for some other reason. The contract of carriage did not require passengers to remain seated at all times while the coach was in motion. The provision of a lavatory at the rear of the coach shows that the operator accepted that a passenger could, and sometimes would, get out of his or her seat. … Mrs Young was not sitting in her seat when she fell. The exemption clause did not apply. The court also questioned, as an aside, whether coach travel is indeed a ‘recreational activity’ under the terms of the Act.

Motorcycle Events Group Australia Pty Ltd v Kelly [2013] NSWCA 361 considered the interaction between the Civil Liability Act 2002 (NSW) and the Trade Practices Act 1974 (Cth) in the context of recreation activities, risk warnings and the effect of exclusion clauses.

Exclusion of Liability by Notice 11.36 In Bennett v Tugwell [1971] 2 QB 267, the plaintiff accepted a ride in the defendant’s car in which there was a sign that said, ‘Warning. Passengers travelling in this vehicle do so at their own risk’. The plaintiff was held to have voluntarily assumed the risk of negligent driving on the part of the defendant, even though he had not understood the sign to mean that he could not sue the defendant if he were to be injured. Ackner J said (at 273): What is required is an objective approach: Legal inquiry into a person being ‘volens’ is not into what he feels or inwardly consents to, but into what his conduct or words evidence that he is consenting to.

Although Ackner J spoke in terms of the defence of voluntary assumption of risk, Trindade and Cane have argued that cases like

Bennett are better understood in terms of a different defence, which they call ‘exclusion of liability’.13 The defence of voluntary assumption of risk is concerned with what the plaintiff subjectively understood and accepted. Therefore, Trindade and Cane argue that the objective approach taken in Bennett must mean, in effect, that a different defence [page 596] was being applied. Their view was adopted, obiter, by Nicholson J in Scanlon v American Cigarette Company (Overseas) Pty Ltd (No 3) (at 293) (see 11.2). This is a useful way of rationalising and making sense of a series of English cases (of which Bennett was one) in which it could not be said that the plaintiff had subjective knowledge of the risk, yet the defendant successfully argued a defence based on a notice which was said to exclude liability. The cases involved situations where entrants were permitted onto land or allowed in vehicles, under conditions the controller or owner purported to impose on the entrant. The central rationale seemed to be one of choice: you have a choice as to whether to come onto my (Martin’s or Ian’s) land or into my vehicle; and I only have to reasonably communicate the conditions under which you do so. It is unnecessary for you to have subjective knowledge of these conditions. 11.37 The ability of the risk creator to rid herself or himself of common law duties in this way is certainly questionable. Various techniques could be used to try to thwart the effect of the defence. For example, it could be argued that the notice or disclaimer had not been reasonably brought to the attention of the injured person. Further, courts sometimes employ a technique of interpretation which preserves the injured person’s claim by ‘reading down’ the words, strictly, so that they do not cover the circumstances that produced the

injury. The court is essentially concluding that the words in the notice or disclaimer were not comprehensive enough to cover the instant case. This is illustrated by Insight Vacations Pty Ltd v Young, where a contractual term purporting to exempt liability was read down by the court (in the context of recreational services providers and the New South Wales Civil Liability Act (2002)) (see 11.35). More recently Alameddine v Glenworth Valley Horse Riding Pty Ltd [2015] NSWCA 219; (2015) 324 ALR 355; Aust Torts Reports ¶82-234 (see 11.31) illustrates how the court takes a rigorous approach to determining whether a contractual term excludes liability. As was noted previously, the court held that the exclusion of liability provided in the application form signed by the appellant’s sister (on her behalf) did not apply, because it was only provided after the contract was formed and because there was no indication that the clause purporting to exclude liability would form part of the contract. As such, s 5N of the Civil Liability Act 2002 (NSW) did not apply. 11.38 The next case raises some doubts about exactly how, in conceptual terms, a notice or disclaimer operates to exclude the defendant’s liability. Case Example Macleay Pty Ltd (t/as Wobbies World) v Moore (1992) Aust Torts Reports ¶81-151 Facts: The plaintiff was injured on a slide at the defendant’s amusement park. She sued the defendant, who denied liability on the basis of a large notice by the entrance to the park, which purported to exclude any liability of the defendant to any entrant. The plaintiff had not seen the notice before entering the park. [page 597] Issue: Did the notice exclude the defendant’s liability? Decision: The Appeal Division of the Supreme Court of Victoria held that the large notice did not exclude the defendant’s liability because the defendant had not taken reasonable steps to bring it to the plaintiff’s attention. Brooking J (with whom Fullagar and Gobbo JJ agreed) said (at 61,151):

There has not at any stage been any real discussion of the proper basis or bases in legal principle of the defence or of whether the condition prevents the duty of care from arising or, on the other hand, merely provides a shield against liability in damages. There has been no discussion of whether the condition may afford a defence to an action in tort by reason of the existence of a contract excluding liability, or by reason of the doctrine of volenti non fit injuria, or by reason of ‘waiver’ … or by reason of some other doctrine. Because both parties had chosen to fight the case on the basis that the notice would take effect, if at all, as a term of the contract between the plaintiff and the defendant excluding liability in the tort of negligence, the court considered the case on that basis, but without accepting that this was the correct approach.

Illegality Common law 11.39 At common law, the mere fact that the plaintiff is engaged in some form of illegal conduct is not in itself a defence to an action in negligence. In Henwood v Municipal Tramways Trust (South Australia) (1938) 60 CLR 438, the plaintiffs’ son was killed while vomiting out of the window of a tram, when his head struck two steel standards in the street. The plaintiffs’ action against the defendant tramway authority succeeded, because the defendant had negligently failed to construct barriers to prevent passengers from leaning out of the windows. The action succeeded even though the plaintiffs’ son had committed an offence against a by-law made pursuant to the Municipal Tramways Trust Act 1906 (SA) s 74, by leaning out of the window. The High Court of Australia held that the mere fact that the plaintiffs’ son was acting illegally in leaning out of the window did not, in itself, constitute a defence to the plaintiffs’ action in negligence. Therefore, at common law, the injured person’s illegality will not necessarily preclude the recovery of damages. The court seeks to determine if parliament intended that outcome, if a criminal law were breached. However, parliament is usually much more concerned with prescribing criminal penalties for violations of the criminal law, rather than considering the consequences that should unfold in a civil claim

context. It is sometimes difficult to discern what parliament intended, because of a lack of clarity.

Under Some Civil Liability Acts 11.40 The common law position has been added to or changed dramatically by a large number of statutory interventions that now prescribe ways in which the [page 598] illegality of the plaintiff’s conduct must be treated by the courts. This is the case in all jurisdictions except for Western Australia, where the legal position has not been changed by legislation, and Victoria, where the statutory effect is minimal. The many and varied (and somewhat perplexing and disturbing) approaches used in the Acts are based on differing perceptions of personal responsibility and how this should affect a plaintiff’s claim, despite the defendant’s carelessness. In some respects, where the legislative encroachments are most severe, they seem to reflect political responses to widely (and loudly) broadcast media reports expressing concern (in some cases) that damages awards had been misguided and required ‘correction’ by parliament. A number of these provisions have the potential to exact very harsh consequences on claimants who were acting illegally when injured. Aside from the penalties imposed by the criminal law, some of these statutory provisions provide that damages awards must be denied or reduced because of the injured person’s illegality. The rationale used to justify punishing the injured person in this roundabout way — affecting claims to civil law damages rather than leaving punishment to the exclusive domain of the criminal law — is questionable. 11.41 As was noted earlier, Western Australia is unaffected by these statutory changes. In Victoria, the legislative response to the plaintiff’s illegality is treated similarly to the plaintiff’s intoxication in that state

— the least prescriptive of the legislative interventions (see 10.39). If the nature of the interventions were placed along a spectrum, Victoria is at one end and New South Wales is at the other. Under the Victorian statute, the court is directed to ‘consider’ the plaintiff’s illegal conduct when determining whether or not the defendant has breached her or his duty of care (injuring the plaintiff).14 Courts must also consider the illegality of an entrant’s conduct when determining whether or not an occupier has discharged her or his duty.15 The Act goes no further with respect to prescribing how the plaintiff’s illegality should affect the plaintiff’s claim, allowing the court to retain its discretion in that regard: see 3.69–3.70. 11.42 Other jurisdictions are far more stringent in the ways in which they limit or circumscribe the court’s discretion in illegality cases. It should be noted that some differences in detail among the statutes are not fully described here. However, in general terms, they exclude liability for damages if the accident occurred while the injured person was engaged in conduct that is variously described as an indictable offence, serious offence, or offence punishable by imprisonment, and this conduct contributed materially to the risk of injury.16 A determination of the causal issue — that is, what qualifies as a ‘material contribution’ on the facts of a particular case — will be critical. In some circumstances, the application of this requirement to the facts may preserve the plaintiff’s claim. [page 599] While most jurisdictions use the civil standard (balance of probabilities) with respect to proving the accident occurred while the injured person was committing an offence, South Australia employs the criminal law standard ‘beyond reasonable doubt’,17 making reliance on this exclusionary provision tougher than is the case elsewhere. Also noteworthy are remarkable provisions in New South Wales,

Queensland and Tasmania, which state that the disentitlement sections operate whether or not the person whose conduct is alleged to constitute an offence has been, will be or is capable of being proceeded against or convicted of any offence relating to the conduct.18 The fact that these sections can preclude or reduce damages awards (depending on the jurisdiction), where there have been no criminal convictions, cannot be justified. Importantly, despite the plaintiff’s illegal conduct, most of the Civil Liability Acts prescribe that the disentitlement will not apply and damages may be awarded if the circumstances are exceptional and if the denial of damages would be harsh and unjust.19 However, Queensland imposes a mandatory (minimum) reduction in damages of 25 per cent, even in circumstances where it would be unjust and harsh to otherwise disentitle the injured person because of her or his illegal conduct.20 Indeed, this can even be greater than the mandatory 25 per cent reduction if the circumstances are such that a greater amount would be ‘appropriate’. New South Wales and Tasmania do not provide the court with the opportunity to make an ‘exceptional’ award. In New South Wales, the denial of recovery provision does not apply to a damages award against a defendant if the harm was caused by the defendant’s conduct and that conduct was an offence (serious or not).21 In a curious nod to the High Court of Australia case, Gala v Preston (see 11.18, 11.43), South Australia’s Act specifically states that common law principles relevant to joint illegal enterprises remain unaffected.22 In the Northern Territory, circumstances involving occupiers are given special additional attention: occupiers do not incur liability to entrants who injure themselves while committing an offence punishable by imprisonment.23 Finally, see 4.50, where we note unique provisions concerning illegality and mental illness, under s 54A of the New South Wales Civil Liability Act (2002).

[page 600]

Summary chart State or territory Australian Capital Territory

Illegality Liability excluded if: injured person engaged (on balance of probabilities) in indictable offence (s 94(1)(a)) and conduct (on balance of probabilities) contributed materially to risk of injury (s 94(1)(b)). Applies to personal injury, death. Court may award damages if circumstances are exceptional and exclusion would produce a harsh/unjust result (s 94(2)).

New South Wales

Liability excluded if: injured person engaged (on balance of probabilities) in serious offence (s 54(1)(a)) and conduct materially contributed to risk of injury (s 54(1)(b)). Applies to personal injury, death, property damage. ‘Serious offence’: punishable by imprisonment for six months or more (s 54(3)). Defendant cannot use exclusion section if defendant’s own offence causes the injury (s 54(2)). This must be read in conjunction with the selfdefence provisions (ss 52–53). See also s 54A: mental illness.

Northern Territory

Occupier or owner of premises does not incur liability if injured person was intending to commit, is committing or has committed an offence on the premises punishable by imprisonment (s 9(1)). More generally, liability excluded if: injured person was engaged (on balance of probabilities) in offence punishable by imprisonment (s 10(1) (a)) and injured person’s conduct (on balance of probabilities) materially contributed to risk of the injury (s 10(1)(b)). Applies to personal injury, death. Court may award damages if circumstances are exceptional and exclusion would produce a harsh/unjust result (s 10(2)).

Queensland

Liability excluded if: (on a balance of probabilities) the plaintiff was injured while involved in an indictable offence and the illegal conduct materially contributed to the risk of the harm (s 45(1)). No limit to the kind of damage to which it applies. Court may award damages if denial would produce a harsh/unjust result

(s 45(2)). But the act imposes mandatory damages reduction of at least 25 per cent (s 45(3)). See also the Criminal Code Act 1899 (Qld) s 6: overlap as well as differences with the Civil Liability Act 2003 (Qld) s 45 — criminal court finds person guilty of indictable offence. Does not limit kind of damage.

[page 601] State or territory South Australia

Illegality Liability excluded if: injured person was injured while involved in indictable offence (court to be satisfied beyond reasonable doubt) (s 43(1)(a)) and illegal conduct (on balance of probabilities) materially contributed to risk of injury (s 43(1)(b)). Applies to personal injury, death. Court may award damages if circumstances are exceptional and exclusion would produce a harsh/unjust result (s 43(2)). Does not affect joint illegal enterprises (s 43(4)(c)).

Tasmania

Liability excluded if: injured person was injured while engaging (on balance of probabilities) in serious offence (s 6(1)(a)) and conduct materially contributed to risk of injury (s 6(1)(b)). ‘Serious offence’ punishable by imprisonment for six months or more (s 6(3)). Applies to personal injury, death, property damage.

Victoria

Court must consider illegality of plaintiff in assessing breach generally (s 14G(2)(b)) and occupier’s liability (s 14B(4)(fb)).

Western Australia

Not addressed.

Joint illegal enterprise: is there a duty to take care? 11.43 At common law, where the plaintiff and the defendant are jointly engaged in an illegal enterprise, the illegality of that enterprise may affect whether a duty of care is owed. This was considered in Gala v Preston (see 5.20, 11.18), where Mason CJ, Deane, Gaudron and McHugh JJ stated (at CLR 250; ALR 34):

There is no a priori reason why the illegality of a particular enterprise or activity should automatically negate the existence of a duty of care which might otherwise arise from the relationship which subsists between the parties. …

The court stated that the existence of a duty of care depends on a relationship of proximity, which arises out of a number of factors, including policy considerations (this passage is quoted at 5.20). However, it is important to recall how, in its more recent jurisprudence, proximity has been abandoned by the High Court of Australia. These days, the prevailing approach to determining whether or not a duty of care exists is the ‘salient features’ approach in which the ‘totality of the relationship’ is evaluated (see 5.25–5.28). On the facts of Gala, the court held that the joint illegal enterprise of stealing and using the stolen car was one of the factors that negated the existence of a duty of care. Mason CJ, Deane, Gaudron and McHugh JJ said (at CLR 254; ALR 37): The joint criminal activity involving the theft of the motor vehicle and its illegal use in the course of a spontaneously planned ‘joy ride’ … gave rise to the only

[page 602] relevant relationship between the parties and constituted the whole context of the accident. That criminal activity was, of its nature, fraught with serious risks. … [E] ach of the parties to the enterprise must be taken to have appreciated that he would be encountering serious risks in travelling in the stolen vehicle … when it could well be the subject of a report to the police leading possibly to their pursuit and/or their arrest.

11.44 In Gala, the High Court of Australia seemed to suggest that if the joint illegality of the enterprise did not affect the risk to which the parties were exposed, it would have no effect on the existence of a duty of care. This issue also arose in cases decided by the High Court, prior to Gala. For example, in Jackson v Harrison (1978) 138 CLR 438; 19 ALR 129, the fact that the plaintiff and defendant were jointly engaged in the illegal enterprise of driving a car while unlicensed was held not to affect the relationship between the parties. Therefore, it did not negate the existence of a duty.

However, Italiano v Barbaro (1993) 40 FCR 303; 114 ALR 21 questioned that understanding of Gala. In Italiano, the plaintiff was injured when the car in which he was a passenger collided with another car. The plaintiff and the drivers of the two cars had fraudulently (and illegally) planned to orchestrate an accident, to make a claim on the cars’ insurance. A majority of the Federal Court of Australia held that the accident that occurred was the very accident that the conspirators had planned; therefore, the defendant did not owe the plaintiff a duty of care. The court unanimously held that there would be no duty of care even if the accident had not been the one planned and even if the plaintiff and defendant were still driving on their way to the site of the planned accident. The court held that there could be no duty in cases of joint participation in serious crime, whether or not the illegality posed any additional risk of injury. 11.45 The leading High Court of Australia case, Miller v Miller (see 11.18), summarised the principles derived from previous High Court authorities concerning joint illegal enterprises (at [70]): First, the fact that a plaintiff was acting illegally when injured as a result of the defendant’s negligence is not determinative of whether a duty of care is owed. Second, the fact that plaintiff and defendant were both acting illegally when the plaintiff suffered injuries of which the defendant’s negligence was a cause and which would not have been suffered but for the plaintiff’s participation in the illegal act is not determinative. Third, there are cases where the parties’ joint participation in illegal conduct should preclude a plaintiff recovering damages for negligence from the defendant. Fourth, different bases have been said to found the denial of recovery in some, but not all, cases of joint illegal enterprise: no duty of care should be found to exist; a standard of care cannot or should not be fixed; the plaintiff assumed the risk of negligence. Fifth, the different bases for denial of liability all rest on a policy judgment. That policy judgment has sometimes been expressed in terms that the courts cannot regulate the activities of wrongdoers and sometimes in terms that the courts should not do so.

The court commented on the importance of policy (at [14]–[15]): [page 603] [I]t is important to identify not only what are the policy considerations that are

engaged, and how they are said to be engaged in the particular case, but also, and more fundamentally, why policy considerations are engaged. [T]he central policy consideration at stake is the coherence of the law.

Key Case Miller v Miller (2011) 242 CLR 446; 275 ALR 611 Facts: In 1998, Danelle, a 16-year-old girl who had been drinking, was wandering through streets in a Perth suburb with her cousins and sister. After being denied entry to a nightclub, she wanted to go home. Because no trains were running and she had no money for a cab, she decided to steal a car from a car park near the club. She asked her unlicensed sister, who had been drinking alcohol, to drive. Maurin, a 27-year-old cousin of Danelle’s mother (described as ‘her uncle’) saw Danelle in the car. He told her she should let him drive, which she did. His friends got into the car, which by then had nine passengers. After driving reasonably for a while, Maurin began to speed and go through red lights. Danelle asked him to slow down. She then asked him to stop and let her out. She repeated her request. Maurin ‘laughed off her concerns’, drove faster, lost control of the car and hit a pole, seriously injuring Danelle, who became a tetraplegic. Another passenger was killed. Danelle sued Maurin. By jointly using the stolen car, the plaintiff and defendant breached s 371A of the Criminal Code (WA). Section 8 provides a defence if there is a withdrawal from the joint enterprise, with a reasonable attempt to prevent the (further) commission of the offence. Issues: What was the effect of the alleged joint illegal enterprise, involving the plaintiff’s theft and later use of the car and the defendant’s drunkenness and use of the stolen car? Did this conduct deny a duty of care? Decision: The trial judge’s finding in favour of the plaintiff (with a 50 per cent reduction for contributory negligence) was reversed by the Western Australia Supreme Court, Court of Appeal. At the High Court of Australia, the joint judgment of French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ allowed the claim. They noted that the defence of voluntary assumption of risk was not pursued. They further observed that this case was governed by common law principles; unlike other jurisdictions, in Western Australia there were no relevant statutory provisions addressing illegality. They stated (at [9]): By the time the accident happened, Maurin and Danelle were no longer engaged in a joint illegal enterprise. Danelle had stolen the car. She and Maurin and some, perhaps all, of the other passengers became parties to a joint illegal enterprise when they agreed to Maurin driving them in what they knew to be a stolen car. Danelle withdrew from that joint enterprise, of using the vehicle without the consent of its owner, when she asked to be allowed to get out of it. The statute’s purpose was of primary concern (at [74], [87], [103]–[104], [106]): It will be by reference to the relevant statute, and identification of its purposes,

that any incongruity, contrariety or lack of coherence denying the existence of a duty of care [page 604] will be found. That is the path that was taken in Henwood v Municipal Tramways Trust (South Australia) (1938) 60 CLR 438. … [T]he decision in this case should be reached by consideration, first, of the statutory purposes of s 371A, and finally of the significance to be attached to Danelle’s twice asking to be let out of the car before the accident happened. … Danelle twice asked to be let out of the car before it ran off the road. … There were no reasonable steps she could take to prevent the continued illegal use of the vehicle. Because Danelle had withdrawn from, and was no longer participating in, the crime of illegally using the car when the accident happened, it could no longer be said that Maurin owed her no duty of care. That he owed her no duty earlier in the journey is not to the point. When he ran off the road, he owed a passenger who was not then complicit in the crime which he was then committing a duty to take reasonable care. The court was not convinced by the standard of care reasoning employed in Gala (at [54]–[55]): … [I]t is not useful to speak of a court not being able to fix a relevant standard of care. Resort to the now well-worn example of safe breakers, and the posing of rhetorical questions about how a court would know what steps a reasonable safe breaker would take, are not helpful. The courts must deal with many difficult questions and with many forms of very discreditable human behaviour. Setting a norm of behaviour as between criminals may be difficult, but it is not impossible. [I]t follows that, instead of asking how the courts can set a relevant standard of care, attention must fall upon whether the courts should be doing that in the particular case. The Joyce rationale also was considered (at [64]): Joyce concerned a gratuitous passenger accepting carriage in a vehicle driven by a person known by the passenger to be drunk. … As … [was found in Imbree v McNeilly (2008) 236 CLR 510; 248 ALR 647], the conclusion that a defendant owed the plaintiff no duty of care is open in a case like Joyce if the drunken driver cannot be expected to act sensibly (an idea that would also underpin a conclusion that the plaintiff voluntarily assumed the risk of being driven by a drunken driver). And as Windeyer J said in [Smith v Jenkins (1970) 119 CLR 397 at 422; [1970] ALR 519 at 535], a conclusion that one illegal user owes no duty of care to a confederate ‘can be regarded as founded on the negation of duty, or on some extension of the rule volenti non fit injuria, or simply on the refusal of the

courts to aid wrongdoers’. … A duty of care arises from the ‘relations, juxtapositions, situations or conduct or activities’ in question [Joyce at CLR 57]. All aspects of the relations between the parties must be considered.

Aside from issues associated with contributory negligence and obvious risks in Harmer v Hare (see 10.11, 11.27), questions of joint illegality were raised, but readily dismissed. Even though the plaintiff and defendant may have contemplated doing ‘burn outs’ later that evening, this was not relevant to the journey in which the accident occurred, which involved swerving into a telegraph pole in a vehicle with bald tyres. In fact, the plaintiff avoided being involved in an illegal activity by doing the driving. The court also distinguished Joyce’s case and other authorities where passengers had voluntarily agreed to be driven by drivers they knew were intoxicated. [page 605]

Special Protection or Immunity from Liability Introduction and examples 11.46 Certain kinds of defendants have been granted immunity from civil liability where legislatures (and sometimes courts, at common law) have deemed their special protection to be in the public interest. This wide-ranging class of persons deemed deserving of protection from civil suit includes, for example, advocates (rather controversially, in D’Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1; 214 ALR 92), who do not owe a duty of care (see 5.27), and some blood donors24 who cannot be found in breach. Further examples of possible protections cover a wide spectrum, from those working at the licensed, medically supervised heroin injection facility in Kings Cross, Sydney25 to staff members who work at schools and provide emergency assistance to schoolchildren (in Western Australia).26 Food donors, good Samaritans and volunteers

are examples of different kinds of classes of defendants who also enjoy certain special protections from civil suit (generally) throughout the country. The Kings Cross licensed, medically supervised heroin injection facility was introduced as a trial, in an effort to reduce many of the serious risks associated with injecting drug use, including the spread of HIV through the shared use of an unclean syringe, and the possibility of suffering a fatal overdose. The facility was also meant to offer a gateway to education and improved health care. Under specially enacted statutory provisions, individuals working at the facility are exempt from civil liability in connection with the conduct of the centre if they act in good faith, are not reckless and are not ‘grossly negligent’.27 By way of contrast, when Victoria proposed the establishment of six similar facilities, the ill-fated bill preserved a client’s right to sue in tort for harm sustained while at the facility. The success of the Kings Cross facility in reducing many serious consequences of heroin use can be measured, in part, by the fact that what was initially a controversial experiment has been extended by statute and eventually made permanent: see Pt 2A of the Drugs Misuse and Trafficking Act 1985 (NSW), entitled ‘Medically supervised injecting centres’. Nevertheless, it should be noted that in Australia generally, the introduction of these types of facilities remains the site of significant political debate, struggle and possible change. Indeed, efforts to establish similar facilities often garner a great deal of publicity (if not legislative traction). For example, in 2017, a report from ‘Australia21’ recommended the introduction of facilities like that in Kings Cross throughout Australia.28 [page 606] In a rather telling sign of the times, several jurisdictions, such as the Australian Capital Territory, enacted specific (but not uniform) terrorism-related protections. Part 3.3 of the Civil Law (Wrongs) Act

2002 (ACT) is headed ‘temporary exclusion of liability for terrorismassociated risks’.29 Under the Australian Capital Territory legislation, for example, there is no right of action for death or injury (or both) arising out of the use of a motor vehicle if the injury or death (or both) are caused by an act of terrorism. The provision does not remove the liability of someone who commits or promotes an act of terrorism or an employer paying compensation to a worker under workers’ compensation legislation. Terrorism is defined broadly. ‘Food donors’ have been provided with immunity in circumstances where food is donated in good faith for a charitable or benevolent purpose. The donor is exempt from liability if the consumer suffers injury.30 To gain statutory protection, the food must have been safe to consume at the time it left the donor’s control, and particular handling and time limit safety information must have been provided to the food recipient. Victoria was the first state to provide legislative protection of this nature. All other jurisdictions have followed suit. In most Australian jurisdictions, two other special classes of wellmeaning persons – ‘good Samaritans’ and ‘volunteers’ — have been provided with protection from civil liability.

Good Samaritans 11.47 With a view to encouraging rescue, good Samaritans have been singled out for protection from civil suit in all jurisdictions. Although there are variations in the statutory language used in each state and territory, the nature of the protection is essentially the same.31 In general terms, if a person assists someone who is injured (or risks being injured or needs emergency medical assistance), the person providing assistance is immune from civil liability. The assistance must be provided ‘honestly’ (or in ‘good faith’), and without payment or expectation of payment. The good Samaritan must not be reckless, and her or his capacity to exercise reasonable [page 607]

care and skill must not be significantly impaired by a recreational drug or alcohol. Curiously, in New South Wales and Tasmania, the exclusions from protection also state that the good Samaritan has to have exercised reasonable care and skill in connection with the act or omission to benefit from the immunity. The protection covers medically qualified persons who gratuitously offer treatment advice. Some jurisdictions highlight the manner in which the advice is provided by medical practitioners, for example, by telephone (or similar telecommunication). In the Australian Capital Territory and South Australia, this protection is not offered if the liability falls within the scope of a compulsory third party motor vehicle scheme.32 While the New South Wales Act is similar, it specifically excludes protection to a good Samaritan who also happens to be the cause of the injured person’s harm.33 Further, the immunity is not granted to a good Samaritan who misrepresents her or his assistance-giving skill or expertise or impersonates a health care or emergency services worker or police officer.34 The most open-ended good Samaritan protection is granted in Victoria’s Wrongs Act 1958, where there is no stipulation that the assistance be provided without recklessness, gross negligence, or impairment by alcohol or recreational drugs to be able to take advantage of the immunity. In fact, the protection applies even if the accident or emergency was caused by the good Samaritan’s act or omission. However, the immunity is not available with respect to any of the good Samaritan’s conduct that precedes the care she or he provides.35 Of all the legislated good Samaritan protections, Queensland’s provisions are the most limited in scope. That state grants immunity to individuals who render first aid or assistance to persons in distress, if the assistance is given while performing duties to ‘enhance public safety’ (these entities are prescribed). However, Queensland’s Law Reform Act 1995 (Qld) s 16 has for several years protected medical practitioners, nurses (and other prescribed persons) from liability with

respect to rendering emergency care if this assistance was provided in good faith, without gross negligence and without fee or reward.

Volunteers 11.48 Volunteers also have been granted protection in all jurisdictions, including the Commonwealth.36 The rationale for their special treatment is highlighted by the preamble to South Australia’s Volunteer Protection Act 2001 (SA): ‘The [page 608] Parliament recognises that volunteers make a major contribution to the South Australian community and seeks to foster and encourage volunteering in the community by all possible means.’ Essentially, a volunteer does not incur civil liability for an act or omission made ‘honestly’ (or in ‘good faith’), without recklessness, while carrying out community work for a community organisation on a voluntary basis. While each state and territory defines ‘volunteer’ slightly differently, in general terms a ‘volunteer’ is someone who carries out community work for no (or sometimes limited and prescribed) remuneration. Certain persons are excluded, such as specified individuals working with bodies such as Country Fire Authorities.37 ‘Community work’ is defined broadly, and (again, generally) includes work for religious, charitable, educational and benevolent purposes; philanthropic purposes; sport, recreation, amusement and political purposes; promoting the arts, literature and science; attending to the needs of the disabled; conserving or protecting the environment; and promoting or preserving historical or cultural heritage, or the common interests of the community. Protection is not available if the volunteer’s capacity to carry out the work was impaired by a recreational drug, the volunteer was acting outside what she or he knew or ought to have known was the scope of the organisation’s authorised activities, or the volunteer was acting contrary to

instructions. Some jurisdictions exclude conduct that creates a serious risk to the health or safety of the public, is violent or is an offence.38 Importantly, the liability that would otherwise attach personally to the volunteer will instead attach to the community organisation for which she or he was carrying out the relevant work. However, claims can be brought against the volunteer if the community organisation disputes its liability for the volunteer’s act or omission. The members of a community organisation’s management committee are protected from personal responsibility in the Northern Territory, if the community organisation incurs liability;39 New South Wales and Queensland extend protection to cover a community organisation’s office holders.40 The protection does not operate if the liability falls within the ambit of a third party motor vehicle scheme.41 New South Wales and Queensland also exclude protection if the liability at issue is one that must be insured against in accordance with state law.42 [page 609]

Summary chart State or territory Commonwealth

Good Samaritans and immunity/protection Not addressed

Volunteers and immunity/protection Volunteers protected: anything done in good faith for the Commonwealth or a Commonwealth authority (s 6(1)). Denied if: motor accident (s 6(2)(a)); defamation action (s 6(2) (b)); ability to carry out work properly was significantly impaired by a recreational drug (which includes alcohol) (s 6(3)); acting outside scope of authorised activities or contrary to instructions (s 6(4)).

Australian

Immunity available: act or omission Volunteers protected: act or

Capital Territory

New South Wales

made ‘honestly’ and without recklessness (s 5(1)); applies to medical practitioners for advice by telephone etc

omission made honestly and without recklessness while carrying out community work (s 8(1)).

Immunity denied: significantly impaired by recreational drug (s 5(2)(b)); if within compulsory third party motor vehicle scheme (s 5(2) (a)).

Denied if: defamation action (s 8(2)(b)); significantly impaired by recreational drug (s 8(2)(c)); acting outside scope of activities authorised by the organisation or contrary to instructions (s 8(2)(d)); within compulsory third party motor vehicle scheme (s 8(2)(a)).

Immunity available: in good faith, without expectation of payment or reward (s 56). Immunity denied if: act or omission caused the injury (s 58(1)); intoxicated or significantly affected by drugs (s 58(2)(a)) and failed to exercise reasonable care or skill (s 58(2)(b)); impersonates a health care or emergency service worker or police officer

Volunteers protected: community work not for private financial gain, for charitable purpose (s 60(1)); act or omission done in good faith. Denied if: defamation action (s 59(1)); criminal offence (s 62); significantly impaired by alcohol or drugs voluntarily consumed and failed to exercise reasonable care and skill (s 63); outside scope

[page 610] State or territory

Good Samaritans and immunity/protection

Volunteers and immunity/protection

New South Wales cont’d

or misrepresents assistance-giving skill or expertise (s 58(3)).

of activities authorised by organisation or contrary to instructions (s 64); insurance required by state (s 65); within compulsory third party motor vehicle scheme (s 66).

Northern Territory

Immunity available if: act done in good faith and without recklessness (s 8(1)); applies to people with medical qualifications in emergency situations providing advice (s 8(2)).

Volunteers protected if: act done in good faith and without recklessness for a community organisation (s 7(1)).

Immunity denied if: intoxicated (s

Denied if: outside scope of authority or contrary to instructions

Queensland

South Australia

8(3)).

of organisation (s 7(2)(a)); while intoxicated (s 7(2)(b)).

Immunity available: to people and prescribed entities performing duties to enhance public safety (ss 26–27); must be in good faith and without recklessness.

Volunteers protected: community work not for private financial gain and is done for charitable purpose (s 38); act or omission done in good faith (s 39(1)).

Protection granted to medical practitioners, nurses who provide emergency care without fee or reward, in good faith and without gross negligence: Law Reform Act 1995 (Qld) s 16.

Denied if: criminal offence (s 40); was intoxicated and failed to exercise due care and skill (s 41); outside scope of activities authorised by organisation or contrary to instructions (s 42); insurance required by state (s 43); within compulsory third party motor vehicle scheme (s 44).

Immunity available: assistance must be in good faith, not reckless (s 74(2)); applies to medical practitioners for advice by telephone etc (s 74(1)).

Volunteers Protection Act 2001 (SA).

Immunity denied if: significantly impaired by drugs or alcohol (s 74(4)(b)); within compulsory third party motor vehicle scheme: (s 74(4)(a)).

Volunteers protected if: act or omission done in good faith and without recklessness in carrying out community work for a community organisation (s 4). Denied if: defamation action (s 4(1) (b)); significantly impaired by a recreational drug (s 4(2));

[page 611] State or territory

Good Samaritans and immunity/protection

South Australia cont’d

Tasmania

Volunteers and immunity/protection acting outside scope of activities authorised by organisation or contrary to instructions (s 4(3)); within compulsory third party motor vehicle scheme (s 4(1)(a)).

Immunity available: good faith assistance, without recklessness, must be without expectation of payment or reward (s 35B).

Volunteers protected: anything done in good faith when doing community work (s 47(1)). Denied if: defamation action (s

Victoria

Immunity denied if: significantly impaired by alcohol or drugs (s 35C(1)(a) and failed to exercise reasonable care or skill (s 35C(1) (b)); impersonates a health care or emergency service worker or police officer or falsely represents assistance-giving skill or expertise (s 35C(2)).

47(2)); motor accident (s 47(2)); acting outside scope of community work organised by organisation or contrary to instructions (s 47(3)); ability to do community work in a proper manner was significantly impaired by alcohol or drugs (s 47(3)(b)).

Immunity available: must be in good faith, no expectation of financial reward (s 31B(1)); applies to advice via telephone etc (s 31B(2)).

Volunteers protected: providing service for community/charitable work in good faith (ss 35–37).

Immunity available if: act done in good faith and without recklessness (s 5AD); also applies to people with medical qualifications in emergency situations providing advice (s 5AD(2)).

Volunteers and Food and Other Donors (Protection from Liability) Act 2002 (WA).

Denied if: member of Country Fire Authority/emergency service (s Immunity denied if: act/omission of 35(3)); outside scope of community good Samaritan occurs before work organised by organisation or assistance, advice, care was given contrary to instructions (s 38(1)(a)); by good Samaritan (s 31B(4)). significantly impaired by alcohol or drugs taken voluntarily (s 38(1)(b)); defamation action (s 38(2)(a)); transport accidents (s 38(2)(b)). Western Australia

Volunteers protected: anything done in good faith when doing community work (s 6(1)).

[page 612] State or territory Western Australia cont’d

Good Samaritans and immunity/protection

Volunteers and immunity/protection

Immunity denied if: significantly intoxicated by drugs or alcohol (s 5AE)). See also Pt 1CA: emergency assistance provided by staff, in good faith and without recklessness, to school children.

Denied if: defamation action (s 6(2)); outside scope of community work organised by organisation or contrary to instructions (s 6(3)(a)); significantly impaired by alcohol or drugs taken voluntarily (s 6(3)(b)); within compulsory third party motor vehicle scheme (s 6(2)).

Problem 1 11.49 Two of Daisy Bay University’s most sycophantic law students, Portia and Paddington, are favourites of the Dean. (This is a private university.) Portia and Paddington happen to be very high achievers and keenly competitive mooters. Despite several controversial wins along the way, they succeeded in making it to the moot court competition grand final, organised by Dr Dashing. In an effort to gain an edge over the competition, they decided to visit Dr Dashing in his level seven office, hoping to glimpse the moot problem on his desk. They frequently visited academic staff on level seven, in their efforts to ingratiate themselves with lecturers, who more often than not seemed to be rather easily flattered. Just before Portia and Paddington got to level seven, Dr Dashing left his office to go to the tea room. He left his office door open. Paddington and Portia snuck into his office, spotting the problem concerning complex Torts defences on Dr Dashing’s desk. Just then, Dirk, a brutish fellow who had been hired to clean the building that day, happened to wander by the office, asking Paddington and Portia what they were doing in Dr Dashing’s office. Paddington deflected Dirk’s queries with chatter about some awesome crazy cat videos they had recently seen posted on InterMeet, the social networking site. While Paddington and Dirk chatted, Portia began to photograph the problem, using her BrightPhone. Dirk noticed what Portia was doing and grabbed the document. Expecting Dirk to punish them, Paddington and Portia were stunned (and relieved) to hear Dirk say, ‘Well, if you want that silly problem so badly, I’m sure we can work something out’. Thinking quickly, speculating that Dirk wanted money in exchange for the problem, Paddington handed him $50; Dirk gave Paddington the problem. Also thinking quickly, Portia photographed the transaction. Portia told Dirk to give back the cash or she would go to the Dean with the photo. Portia was confident that she and Paddington could use their best advocacy skills on the Dean to sweet-talk their way out of their predicament. [page 613] Shocked by the fact that Portia and Paddington were reneging on the deal, Dirk chased them out of Dr Dashing’s office, down level seven’s lengthy tiled corridor, which Dirk had just finished cleaning with ‘Acme Bargain Basement Board Wax’. Acme had warned customers that this inexpensive product was designed for use on wooden floorboards. If used on tiles, it created a dangerously slippery surface. Acme recommended using its much more expensive product on tiled surfaces – ‘Acme Top-Notch Tile Cleaning Wax’. Portia ran madly down the corridor to escape Dirk, who was furiously shouting expletives at her. Portia slipped, fell and slid past a small notice on a sandwich board placed on the floor; the notice had tiny red lettering, which stated: ‘Be careful in this building. We are not liable for your harm howsoever caused.’ Portia first saw the sign when she slid by it. Portia seriously injured her back as a result of her nasty fall. Advise Dirk and Portia with respect to the defences (or ‘defensive strategies’) available

to Dirk. Your discussion should focus on principles in this chapter. However, you also may wish to consider principles explored in Chapters 3 and 10. Note that in this chapter’s discussion, we are commencing with Dirk’s defensive arguments.

Discussion Arguments for Dirk 11.50 In order to establish the defence of voluntary assumption of risk, Dirk must show that Portia voluntarily accepted the risk of injury on level seven. Dirk can argue that one can infer from the simple fact that Portia ran wildly along a lengthy corridor, that she voluntarily accepted all the risks inherent in running in that manner and understood the nature of those risks. Further, she clearly entered the premises freely and willingly — satisfying all the elements of the defence, as outlined in Scanlon v American Cigarette Company (Overseas) Pty Ltd (No 3) and by McClellan CJ in Carey v Lake Macquarie City Council. Portia must be taken to have clearly appreciated the risk and would have understood the facts constituting it — running along the lengthy tiled floor. There is no suggestion that she was led to believe that running wildly indoors would be without incident. Even if the floor had not been freshly waxed, it presumably would have been rather slippery. This is dissimilar to Randwick City Council v Muzic, where the New South Wales Court of Appeal rejected the defence, as the plaintiff in that case was walking carefully and slowly along the algae-covered promenade. Moreover, in Muzic there had been a large number of previous accidents, about which the council was well aware. Further, the decision in CG Maloney Pty Ltd v Hutton-Potts, where the court rejected the defence (argued on statutory terms), holding that undetected unbuffed liquid polish on a wooden floor was not an ‘obvious risk’, is limited to its own facts in terms of precedential value. Because the risk she encountered was ‘obvious’, a statutory onus reversal is triggered in a large number of jurisdictions, making it difficult for her to succeed [page 614] in her claim. As was noted in Viscardi v Hornsby Shire Council, obviousness is a characteristic that must be considered in context. Here, Portia was in a position to fully appreciate the risks of injury, even in the frenzied atmosphere of her escape. A reasonable person in her position, determined objectively in the circumstances (Waverley Council v Ferreira), would have appreciated that the floor could be slippery. Windley v Gazaland Pty Ltd t/as Gladstone Ten Pin Bowl is distinguishable factually, as it involved bowling alley conditions that were not normal, or obvious, due to the risk created by low lighting, resulting in poor visibility. Further, unlike Guru v Coles Supermarkets Australia Pty Ltd, a reasonable person in Portia’s position at the time

would have noted the nature of the flooring and the fact it could be slippery even if it was not being cleaned. Dirk may rely upon Blakemore v Moore, where the crushed terracotta tile was an obvious risk, because its presence was well known to the plaintiff. Here, Portia was well aware of the level seven environment, having frequented that floor to engage with lecturers. Portia freely and willingly accepted the risk of slipping on a waxed floor. She was in the process of escaping after committing an illegal act, quite deliberately running as fast as she could, with full volition, free of coercion, not unlike the unsuccessful patron in Schuller v SJ Webb Nominees Pty Ltd, who, under the South Australian statute, freely and willingly accepted the risk of injury when she danced on a chair, while inebriated, at the defendant’s venue. Further, Portia knew she was escaping the clutches of someone who had witnessed her thievery and was in fact running to elude the legal consequences of her illegal acts. The only pressure in these circumstances was from her and Paddington’s own illegal activities, which could not be said to be a legitimate basis to deny the free-will requirement necessary to successfully engage the voluntary assumption of risk defence. This bears little resemblance to Carey, where it could not be said that the cyclist voluntarily accepted the risk of colliding with unexpected objects on the bicycle path, or other cases that are dissimilar factually (and of little precedential value), such as Simmons v Rockdale City Council (at trial on the ‘obvious risk’ point)) and Holroyd City Council v Zaiter. Dirk would concede that this incident was not one which could be characterised as involving a ‘dangerous recreational activity’, where relevant statutorily in some jurisdictions. Portia must have subjectively known that there was a risk that she might slip when running wildly along a corridor. The present case is unlike Rootes v Shelton, where it was held that the plaintiff water-skier had not voluntarily assumed the risk of negligent driving by the defendant merely by engaging in a water-skiing manoeuvre that he knew to be dangerous. The risks inherent in the ‘Russian roulette’ manoeuvre performed by the plaintiff in Rootes did not include negligent driving of the speedboat by the defendant. By way of contrast, Portia went to level seven, knowing the nature of the risk associated with stealing a document from an office to which she had no right of access. This was followed by an attempted escape from apprehension. Portia’s actions show that by running along a corridor that had just been cleaned, which had a sign advising of the need to take care, she voluntarily accepted the risks inherent in trying to escape from someone who had discovered her criminal conduct. This included the risk that the floor would be somewhat slippery. Portia’s [page 615] fall was Portia’s responsibility, not Dirk’s: her voluntary act of running along a freshly cleaned floor was what resulted in her own slipping, falling and injuring her back. Dirk will have an additional defence to Portia’s action if he can show that the notice he placed on the floor of the tiled corridor exempted him from liability. In Bennett v Tugwell,

the court stated that a notice might exclude liability even if the plaintiff did not understand that the notice prevented the defendant from being sued. The court said that the question to be asked is whether the plaintiff’s conduct objectively evidenced that she or he was consenting to the negligent act, despite what the plaintiff was actually thinking. Here, Portia’s conduct in running down the tiled corridor is evidence that she consented to the risk of injury that she might fall, thus waiving her right to sue. This case is not the same as Macleay Pty Ltd (t/as Wobbies World) v Moore, where the court found that reasonable steps had not been taken to bring the sign to the plaintiff’s attention. Here, the sign was placed on a sandwich board near where the risk existed, on the newly waxed floor; it should have presumably been seen by anyone walking down the corridor attentively. While the sign may have been small, there is no evidence it was not reasonably visible. It is certainly arguable that the notice was reasonably brought to the attention of all entrants. Further, unlike the interpretation given by the High Court of Australia to the exemption clause at issue in Insight Vacations Pty Ltd v Young, the words here are sufficient and clear enough to cover the risk of harm in these circumstances, as it covers all situations of harm, ‘howsoever caused’. Finally, while it is conceded that the waiver in Alameddine v Glenworth Valley Horse Riding Pty Ltd was not given effect, that case is unhelpful here, as it involved an activity that the defendant had said was ‘surprisingly easy’. There is little to be gained by using the reasoning in that case on the instant facts. Because of the earlier events immediately antecedent to Portia’s injury, Dirk will also maintain, in the alternative, that he did not owe Portia a duty of care because they were engaged in a joint illegal enterprise. Although it is an unattractive argument, Dirk could contend that their relationship was criminal in nature. To find a duty would be an affront to the norms of the criminal law, which requires that illegal behaviour be punished, not condoned. Here, their relationship was governed by their jointly illegal interaction, involving attempted theft. The ultimate result in Miller v Miller is of little assistance to Portia’s claim. The court in Miller distinguished Gala v Preston on the basis of the Miller plaintiff’s attempt to extract herself from the joint illegal enterprise before the accident occurred. With respect to principle, the court in Miller emphasised that the policy of the law that has been violated and coherence of the law are the underlying rationales for determining whether or not a duty is owed. Dirk would argue that, on the basis of Miller, it would be undesirable and misguided if the court awarded damages in the context of a break and enter and attempted theft. He should, however, be prepared to concede that the instant scenario could perhaps be characterised as one involving separate rather than joint acts of illegality, such that Gala and Miller may not apply. Aside from arguing possible joint illegality, voluntary assumption of risk and exclusion by notice, Dirk would contend that because Portia had acted illegally (on her own) she should not be allowed to recover. It is conceded that Portia is not precluded from recovery due to her illegality if Daisy Bay University is in Western Australia, [page 616] which is governed by the common law, or Victoria. Nevertheless, even in Victoria, s 14G of the Wrongs Act 1958 (Vic) clearly denotes the legislative intention to not allow injured

persons to benefit from their illegal conduct. By considering Portia’s illegal entry, attempted theft and attempted extortion, no breach should be imposed on Dirk. Admittedly, Dirk’s position would be stronger if Daisy Bay University was located in cities like Canberra, Newcastle, Darwin, Brisbane, Adelaide and Launceston. If it had occurred in one of the states or territories in which those cities are located, her illegal conduct could have resulted in an automatic denial of damages, or at the very least a mandatory reduction, as in Queensland (discussed below). Had her injury occurred in one of these jurisdictions, it seems clear that the relevant Acts’ common criteria would be satisfied. Each example of her illegal conduct amounted to an offence that was serious enough to engage the relevant state’s or territory’s statutory provisions (regardless of the varying ways in which ‘seriousness’ is defined). Even the higher standard of proof prescribed in South Australia would be satisfied: Civil Liability Act 1936 (SA) s 43(1)(a). Indeed, in New South Wales, Queensland and Tasmania, Portia’s illegality affects her claim whether or not she is capable of being proceeded against or convicted of her conduct. Further, Portia’s seriously illegal acts contributed materially to her injury — she was running wildly down the tiled corridor because she had committed illegal acts and because she wanted to avoid facing the consequences of her conduct. Her illegality was intimately connected to the way in which she was injured a few moments later. Portia cannot take refuge in the exceptions granted by some legislatures (the Australian Capital Territory, Northern Territory, Queensland, South Australia), as there is nothing exceptional about her circumstances. Indeed, it would not be harsh or unjust to deny compensation to someone who entered an office surreptitiously, attempted to steal a document and attempted extortion. Any one of the offences is serious enough on its own to preclude reliance on the concession provisions. The cumulative effect of Portia’s many crimes is so significant, the court should not entertain the possibility of applying these exceptional provisions in these circumstances. If Daisy Bay is in Queensland, and if this scenario were treated as ‘exceptional’ (which Dirk would argue should not be the case), the court must nevertheless reduce any damages by at least 25 per cent. Here, the circumstances dictate that the reduction in Queensland should be even higher — as appropriate to the circumstances of the case: Civil Liability Act 2003 (Qld) s 45(3). Assuming Portia’s injury had occurred in Newcastle or Launceston, the relevant state statutes do not provide her with the kind of concession available elsewhere that are based on ‘exceptional’ circumstances and the harshness of the result. If this incident had occurred in New South Wales, Portia may try to argue that because Dirk’s own conduct constituted an offence, he cannot rely on Portia’s independent illegality to deny his liability. She would argue that Dirk cannot rely on the damages denial defence because of his own conduct, which she would contend caused her injury. He of course would deny that this is the case, factually: Civil Liability Act 2002 (NSW) s 54(2). This could be difficult for Dirk, if he also argued, based on Gala v Preston (discussed above), that no duty was owed. Like Portia, he would have to [page 617]

keep a close eye on how different alternative arguments interact, to ensure that one does not wholly undermine the other. (Note that in an alternative argument Portia would also attempt to refute Dirk’s Gala v Preston ‘no duty’ contention, discussed earlier.) Finally, if this scenario is characterised as an occupiers’ liability situation, and Daisy Bay is in the Northern Territory, then no liability is imposed on the occupier if Portia was intending to commit or was committing an offence punishable by imprisonment: Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 9(1). Dirk concedes that he may face some difficulty characterising himself as an occupier, as demonstrating he had sufficient control would not be an easy task. Arguments for Portia 11.51 Portia should concede that in some cases, such as Bennett v Tugwell, the plaintiff has been prevented from recovering damages because of a notice excluding liability. In Bennett, the court said that a plaintiff cannot recover damages if her or his conduct indicates that she or he consented to the risk of injury, regardless of what the plaintiff was actually thinking. However, she should argue that her case is more similar to Macleay Pty Ltd (trading as Wobbies World) v Moore than it is to Bennett. In Moore, the defendant unsuccessfully claimed that a notice near the entrance to an amusement park absolved it from liability. The court found that the defendant had not taken reasonable steps to bring the sign to the entrant’s attention. Here, Dirk did not take reasonable steps to draw Portia’s, or anyone’s, attention to the notice on the sandwich board: it was small and used tiny lettering — an insufficient notice. Portia can argue that it is not one on which Dirk should be able to exempt himself from liability. Further, the terms of the notice are too general and imprecise to cover the kind of injury sustained here and the way in which it was sustained. It should be construed narrowly, not allowing Dirk to exempt himself from liability, in a manner similar to the High Court’s determination in Insight Vacations Pty Ltd v Young (where the court also held that s 5N of the Civil Liability Act 2002 (NSW) was of no assistance to the defendant). Moreover, from a policy point of view, a court should not give wide scope to a defence based on a sign’s exemption clauses or terms, where it inappropriately tries to absolve the defendant from responsibilities imposed by the common law, and where they do not expressly agree upon the terms (as in Insight Vacations). Indeed, here, Dirk should not be relieved of his responsibility to Portia on the basis of such a vague notice that could not be said to cover what actually happened to Portia. He should be held liable because the floor was inordinately slippery as a result of him using the cheap, dangerous and inappropriate floor-waxing product. This carelessness caused her harm. The limits that should be placed on attempts to exclude responsibility are well illustrated by Alameddine v Glenworth Valley Horse Riding Pty Ltd where the court did not give effect to detailed waivers, bearing in mind the nature of the relevant risk and when the agreement had been entered into by comparison to when the application form was signed. Portia will argue that the defence of voluntary assumption of risk is not applicable here, as her situation did not meet the strict requirements that must be satisfied

[page 618] for that defence to succeed. She did not expressly consent to the risk of slipping and falling, so her consent (if any) can only be inferred from her conduct on level seven. At most, that conduct indicates that she might have accepted some risk of injury if she even knew the floor was waxed and slippery. However, there is nothing to suggest that she accepted the risk that materialised: an injury caused by Dirk chasing her down the corridor and Dirk’s negligent failure to provide a sufficient warning or use an appropriate cleaning product. In this respect, this case is like Rootes v Shelton, where the plaintiff was injured while performing a dangerous water-skiing manoeuvre behind a boat negligently driven by the defendant. Owen J stated that although the plaintiff had voluntarily assumed the risk of injury by choosing to perform the dangerous manoeuvre, there was nothing to indicate that he had voluntarily undertaken the risk that the defendant would fail to exercise due care for his safety when driving the boat. In the present case, Dirk might argue that Portia had consented to some general risk of injury because she knew that when she ran down the corridor she might fall. However, it cannot be inferred that she consented to a negligent failure to use a proper cleaning product from the simple fact that she ran down the corridor. Her conduct is quite consistent with the expectation that the building would be kept in a reasonable condition, and not be cleaned using a cheap, inappropriate cleaning product. Further, Portia was not in a position to fully appreciate the risks of injury, especially in the frenzied atmosphere of her escape. Also, there is no reason to believe that Portia had any idea or proper appreciation that the floor was as slippery as it was; she could not be said to have expected to suffer such a nasty fall. The reasonable person, objectively, in her circumstances would not perceive this as ‘obvious’ (Waverley Council v Ferreira). This is similar to CG Maloney Pty Ltd v Hutton-Potts, where the New South Wales Court of Appeal rejected the defence (argued on statutory terms), holding that undetected unbuffed liquid polish on a wooden floor was not an ‘obvious risk’. Portia could also rely on Basten JA’s comments in Fitzsimmons v Coles Supermarkets Australia Pty Ltd and the decision in Queensland v Kelly to argue that there was nothing about this risk that would have been ‘obvious’ to the reasonable person in her position, such that there would be an onus reversal. Portia did not know the facts constituting the risk and did not fully appreciate it, thus refuting the applicability of the voluntary assumption of risk defence. Portia could further rely upon additional authorities, such as Simmons v Rockdale City Council (at trial) and Holroyd City Council v Zaiter, where the courts have carefully assessed when a risk should be considered ‘obvious’. Schultz v McCormack is also of assistance, as the court held that in the circumstances, the risk of slipping, having regard to the poor lighting and shape of the awning, resulting in the pooling of water at the top of the landing, was not obvious and a reasonable person ought to have provided a warning. By way of contrast, Blakemore v Moore should not be relied upon as the facts at issue involved a crushed tile that was clearly an obvious risk — red terracotta colour, which contrasted with the concrete surface of the car park. Also, in that case, its presence was well known to the plaintiff. While Portia may have visited level seven frequently, she did so with academic matters on her mind. There is no reason to assume that a reasonable person in her position would have taken note of

the floor surface, let alone its propensity for being slippery when improperly and carelessly cleaned. [page 619] In any event, even if the risk could be deemed ‘obvious’ under the relevant Civil Liability Acts (which is not conceded), this does not reverse all aspects of the onus of proof requirements (in those jurisdictions where this is possible): for example, Dirk still has to prove that Portia freely and willingly encountered the risk. As was argued earlier, Portia could not be said to have voluntarily taken on the risk that was indeed at issue (as in Carey v Lake Macquarie City Council). As was the case in Nicol v Whiteoak (No 2), this element of the defence has not been satisfied on the evidence. It cannot be said that Portia freely and willingly accepted the risk of slipping on a waxed floor and injuring her back by running down a corridor. She was pressured into this, as she was being chased by Dirk, who was ranting and raving at her. The need to escape his clutches pressured her into running down the corridor, robbing her of her ability to make a sensible decision with full volition, free of coercion. This is quite unlike Schuller v SJ Webb Nominees Pty Ltd, where it could be inferred on the evidence that the patron freely and willingly accepted the risk of injury when she danced on a chair, while inebriated, at the defendant’s venue. In Schuller, the patron was the author of her own misfortune, free from any sort of pressure to do what she did. If Dirk tries to argue (somewhat curiously and brazenly, perhaps) that he did not owe Portia a duty of care, because both he and she were involved in a joint illegal enterprise, this argument should fail. As was demonstrated in Miller v Miller, not every joint illegal activity results in the denial of a duty of care. This situation is unlike that which occurred in Gala v Preston, where the sole basis of the relationship between the plaintiff and defendant was determined and governed by their joint illegal activities, which took place over a relatively lengthy period of time. The High Court in Miller observed that the rationale underlying this type of case, where duties may or may not be found to exist, involved the policy of the law that has been infringed and matters of coherence. Gala is very different from the present case, where the cause of injury was Portia slipping and falling on the newly waxed tiled floor. There was more to the nature of the relationship between Dirk and Portia than simply criminal behaviour. Any criminal conduct was marginal to what occurred during the course of the afternoon. Portia was an entrant or visitor on the premises. Therefore, any purported illegal activity was peripheral to their overriding relationship, Portia’s harm and how it was sustained. In fact, it could also be argued that if there was a ‘joint enterprise’, it ended long before the moment when Portia was injured. Like the successful plaintiff in Miller, Portia had withdrawn from any such enterprise (even if a joint illegal activity could be said to have existed, factually). It should be noted that the South Australian legislature specifically preserved common law principles: Civil Liability Act 1936 (SA) s 43(4)(c). Portia’s alleged unilateral illegality, entering Dr Dashing’s office without his permission, will be an important issue here, producing diverse results in different jurisdictions. If Daisy Bay University is in Victoria, the fact that Portia allegedly acted illegally by breaking into his office, attempting to take the problem and embarking upon a course of

conduct amounting to possible extortion, must be considered by the court in determining whether Dirk breached his duty of care to her (assuming she circumvents the Miller/Gala hurdle): Wrongs Act 1958 (Vic) s 14G. Importantly, under this Act, Portia’s allegedly illegal acts, in and of themselves, do not preclude Portia from recovery. Further, they do not even amount to conduct that must be characterised as contributory negligence, with a mandatory reduction of damages. [page 620] Portia would argue that s 14B(4)(fb) of the Wrongs Act 1958 (Vic), the additional Victorian provision concerning occupiers and illegal entrants, would have a similar effect; it would be of little consequence in the breach assessment. If this took place in Western Australia, then the common law (Henwood) would apply, presumably to Portia’s relief. Portia could convincingly argue that what she did was not the kind of conduct (or ‘serious offence’) warranting the imposition of the illegality provisions in other jurisdictions. Although seriousness is defined in the statutes in different ways, the clear general intent is that conduct that is minimally criminal in nature should not be embraced by these provisions. The sections generally cover indictable offences or offences punishable by at least six months of imprisonment. Portia would argue that she did not break into the office, as she entered it using the open door; she did not take anything from the office, so did not commit theft; she did not in fact extort anything from Dirk. She should be warned, though, that if her case takes place in New South Wales, Queensland or Tasmania, her illegality affects her claim whether or not she is capable of being proceeded against or convicted for her conduct. If, however, her injury occurred in South Australia, Dirk would have to meet the higher standard, ‘beyond reasonable doubt’, in proving that Portia was involved in an indictable offence when injured: Civil Liability Act 1936 (SA) s 43(1)(a). Assuming that Portia’s conduct does meet the seriousness requirement to be an offence (however it is described or defined), she should nevertheless be able to argue successfully that her conduct did not materially contribute to her injury — falling on a slippery floor could have occurred anyway, as a result of Dirk’s negligence. She would emphasise that her conduct in the office was so far removed from her injury that it was quite independent of the fall for which Dirk was responsible. If Daisy Bay University is in the Australian Capital Territory, Northern Territory, Queensland or South Australia, she also could argue that her case should be determined ‘exceptional’, such that a denial of damages would be harsh and unjust. This exception seems most apt here, as the circumstances are not at the high end of malevolence or criminality. It could almost be seen to be a misguided prank gone wrong. At most, she should be chastised for being an over-achiever, not someone for whom damages should be denied in a credible, legitimate negligence action. Portia will no doubt hope that Daisy Bay University is not in New South Wales or Tasmania: if it were, she would be in a particularly unfortunate position, as in those states there are no statutory provisions that would allow the court to treat her case as ‘exceptional’.

The result would be somewhat different if Portia’s case arose in Queensland. Although Portia would again argue that the court should invoke the ‘exceptional’ circumstances provisions, even if it did so, the court would be bound to make an automatic reduction of her damages by at least 25 per cent. If this were the path taken by the court, Portia would stress that this reduction should be kept at the minimum level. She should emphasise that the imposition of a greater reduction would not be appropriate in the circumstances of her case, because of the minimal nature of the criminal conduct. [page 621] Assuming that Daisy Bay is located in the Northern Territory, Portia would refute Dirk’s attempt to use its special occupiers’ liability provisions, whereby her recovery would be denied because of her illegality. She would argue that Dirk did not have the kind of control necessary to be considered an ‘occupier’. Interestingly, Portia would contend that in New South Wales, Dirk’s own act, where he was about to take a document that did not belong to him and give it to Portia and Paddington in exchange for money, is itself a criminal offence. This would preclude his ability to rely on Portia’s illegality as a defence. Portia would therefore argue that because of his own illegal conduct, Dirk cannot disentitle Portia from recovery due to her illegal conduct; Dirk should not be able to rely on the section to deny damages to Portia because of her illegality, where he too was culpable, having committed a criminal offence. However, Portia would need to show that what Dirk did was in fact an offence and that it contributed materially to her injury: Civil Liability Act 2002 (NSW) s 54(2). This may be difficult, seeing that Dirk will no doubt contend that, if anything, it was the wax that caused her injury, not any offence he supposedly committed (the commission of which he would of course deny). Finally, Portia would have to take care to make sure that arguments of this nature avoid heading into Miller territory, where it could potentially lead to the denial of a duty of care (unless her circumstances are distinguishable in result, as in Miller, noted above).

Problem 2 11.52 To celebrate the end of their first year of university, Pixie and Paz were given tickets to attend an all-night rave with some of their friends on a hot November night. The rave was held in a warehouse owned by Derrick. Derrick owned similar warehouses throughout the country, and used them to stage all-night dance parties at different times of the year in different cities. Before the rave, Derrick placed a small sign near one of the entrances to the warehouse. On the sign was written: ‘The organisers of this event disclaim liability arising from any injury suffered on these premises.’ Pixie’s and Paz’s tickets did not contain statements that attempted to limit liability. During the rave, Derrick sold bottles of water for about $5 per bottle. He also sold (more

surreptitiously) ecstasy tablets, one of which was sold to Pixie. Pixie had never taken ecstasy before, and was told by her friends that ‘everyone uses it — it’s virtually legal’. Relieved to hear this, Pixie consumed the tablet. Paz did not take any drugs. Derrick underestimated the number of water bottles needed that night. By 2:00 am, there were few bottles left. So, seeing that there would be a large demand for the bottled water, he increased the cost to $10 per bottle. No other drinks were available. Although there was running water in the portable toilets, this water was undrinkable. Strapped for cash by 3:00 am — and unable to afford any bottled water — Pixie and Paz went without drinking. Around 4:00 am, they were about to leave. However, their friends taunted them, saying ‘only losers leave early’. Pixie and Paz relented, staying on, intending to dance until sunrise. [page 622] By 5:00 am, Pixie and Paz had been dancing continuously at the rave for almost six hours. Soon afterwards, they both fainted from dehydration on the dance floor, and knocked their heads on the ground. They seriously injured themselves. As it turned out, the ecstasy tablet Pixie had bought from Derrick was extremely potent. This batch of tablets made those who used them much thirstier than was normally the case. Neither Pixie nor Derrick knew about this batch of tablets’ extra strength. Pixie and Paz wish to sue Derrick, alleging that their injuries were caused by his negligence. Advise Derrick, Pixie and Paz on the defences (or ‘defensive strategies’) available to Derrick. Your discussion should primarily focus on principles in Chapter 11. However, Chapters 3 and 10 are also relevant and are worth considering.

Further discussion 1. Discuss whether or not the defence of voluntary assumption of risk can be used successfully by: •

mobile phone manufacturers, assuming that there is general awareness that mobile phones can cause brain tumours; • airlines, in cases where passengers suffer deep vein thrombosis (‘economy class syndrome’) (arguably a consequence of flying in cramped conditions). (Assume that issues presented by international aviation conventions (treaties) can be circumvented.) 2. Would it be preferable to treat mobile phone or deep vein

thrombosis claims as ones that raise standard of care issues, or the defence of contributory negligence, rather than the voluntary assumption of risk defence? 3. Comment critically on the different approaches taken by the states and territories to the legal effect of an injured person’s illegality on her or his claim for damages in tort. Whose approach do you prefer, and why? 4. Discuss the merits (or otherwise) of prescribing special legal regimes for circumstances involving statutorily defined ‘dangerous recreational activities’. 5. Having regard to the wealth of case law interpreting provisions involving ‘obvious risk’ and ‘dangerous recreational activities’, consider whether or not you believe the Ipp Panel’s objectives have been satisfied. 6. Discuss whether or not someone who works at the licensed, medically supervised heroin injection facility in Kings Cross, Sydney should be protected from liability in negligence, even though she or he was careless. Should a worker at this facility be subject to typical negligence principles, as was mooted in the proposed (and ill-fated) Victorian supervised injecting facility regime? [page 623] 7. Discuss whether or not food donors, good Samaritans and volunteers deserve special protection from civil claims for damages, even though their careless conduct caused harm.

Further reading Balkin R P and Davis J L R, ‘Defences to Negligence’ in Law of Torts,

5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 10. Barker K, Cane P, Lunney M and Trindade F, ‘Defences to Torts Involving Negligence’ in The Law of Torts in Australia, 5th ed, Oxford University Press, 2012, Ch 12. Dietrich J, ‘Liability for Personal Injuries Arising from Recreational Services’ (2003) 11 Torts Law Journal 244. —, ‘Liability for Personal Injuries from Recreational Services and the New Australian Consumer Law: Uniformity and Simplification, or Still a Mess?’ (2011) 19 Torts Law Journal 55. Field I, ‘Good Faith Defences in Tort Law’ (2016) 38 Sydney Law Review 147. Garling P, ‘Civil Liability Act 2002 — Burdens for a Defendant’, New South Wales Bar Association Personal Injury Conference, Sydney, 15 March 2014. Goudkamp J, ‘A Revival of the Doctrine of Attainder? The Statutory Illegality Defences to Liability in Tort’ (2007) 29 Sydney Law Review 445. —, ‘The Defence of Joint Illegal Enterprise’ (2010) 34 Melbourne University Law Review 425. Lunney M, ‘Personal Responsibility and the “New” Volenti’ (2005) 13 Tort Law Review 76. Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Defences to Torts Involving Negligence’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 6. McDonald B, ‘The Impact of the Civil Liability Legislation on Fundamental Policies and Principles of the Common Law of Negligence’ (2006) 14 Torts Law Journal 270. Peden E and Carter J W, ‘Consumers Beware: The Loss of Contractual Protection for Recreational Risks’ (2004) 1(3) Australian Civil Liability 33. Perry G, ‘Obvious Risks of Dangerous Recreational Activities: How is

Risk Defined for Civil Liability Act Purposes?’ (2016) 23 Torts Law Journal 56. Singh J, ‘A Realistic Route to Vicarious Immunity: Third Parties, Exclusion Clauses and Voluntary Assumption of Risk’ (2013) 21 Tort Law Review 38. Thorpe D, ‘Adolescent Negligence, “Obvious Risk” and Recent Developments in Neuroscience’ (2014) 21 Torts Law Journal 195.

1 2 3

4 5 6 7 8 9

10 11 12

13 14 15 16

Civil Law (Wrongs) Act 2002 (ACT) s 96(1), (5); Civil Liability Act 1936 (SA) s 47(1), (6). Motor Accidents Compensation Act 1999 (NSW) s 140. See Civil Liability Act 2002 (NSW) ss 5F–5H; Civil Liability Act 2003 (Qld) ss 13–15; Civil Liability Act 1936 (SA) ss 36–38; Civil Liability Act 2002 (Tas) ss 15–17; Wrongs Act 1958 (Vic) ss 53–54; Civil Liability Act 2002 (WA) ss 5M–5O. Civil Liability Act 2002 (NSW) s 5H; Civil Liability Act 2003 (Qld) s 15; Civil Liability Act 1936 (SA) s 38; Civil Liability Act 2002 (Tas) s 17; Civil Liability Act 2002 (WA) s 5O. Civil Liability Act 2002 (NSW) ss 5J–5M; Civil Liability Act 2003 (Qld) ss 17–19; Civil Liability Act 2002 (Tas) ss 18–20; Civil Liability Act 2002 (WA) ss 5E–5I. Civil Liability Act 2002 (NSW) s 5K; Civil Liability Act 2002 (WA) s 5E. Civil Liability Act 2003 (Qld) s 18; Civil Liability Act 2002 (Tas) s 19. Civil Liability Act 2002 (NSW) s 5M; Civil Liability Act 2002 (WA) s 5I. This minefield is explored in detail in J Dietrich, ‘Liability for Personal Injuries Arising from Recreational Services: The Interaction of Contract, Tort, State Legislation and the Trade Practices Act and the Resultant Mess’ (2003) 11 Torts Law Journal 1; J Dietrich, ‘Minors and the Exclusion of Liability for Negligence’ (2007) 15 Torts Law Journal 87. See Competition and Consumer Act 2010 (Cth) s 139A; Australian Consumer Law (Cth) s 64; Civil Liability Act 2002 (NSW) s 5N; Fair Trading Act 1987 (SA) s 42; Australian Consumer Law and Fair Trading Act 2012 (Vic) s 22; Civil Liability Act 2002 (WA) s 5J. Competition and Consumer Act 2010 (Cth) s 139A(2); Civil Liability Act 2002 (NSW) s 5K; Civil Liability Act 2002 (WA) s 5E. Civil Liability Act 2002 (NSW) s 5N(6); Civil Liability Act 2002 (WA) s 5J(5). Competition and Consumer Act 2010 (Cth) s 139A(4), (5); Australian Consumer Law and Fair Trading Act 2012 (Vic) s 22; Fair Trading Act 1987 (SA) s 42(2), (3); Civil Liability Act 2002 (WA) s 5J(6). See F Trindade, P Cane and M Lunney, The Law of Torts in Australia, 4th ed, Oxford University Press, Melbourne, 2007, pp 693–4. Wrongs Act 1958 (Vic) s 14G(2)(b). Wrongs Act 1958 (Vic) s 14B(4)(fb). Civil Law (Wrongs) Act 2002 (ACT) s 94(1); Civil Liability Act 2002 (NSW) s 54(1); Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 10(1); Civil Liability Act 2003 (Qld) s 45(1); Civil Liability Act 1936 (SA) s 43(1); Civil Liability Act 2002 (Tas) s

17 18 19

20 21

22 23 24 25 26 27 28 29

30

31

32 33

34 35 36

6(1). Civil Liability Act 1936 (SA) s 43(1). Civil Liability Act 2002 (NSW) s 54(5); Civil Liability Act 2003 (Qld) s 45(4); Civil Liability Act 2002 (Tas) s 6(2). Civil Law (Wrongs) Act 2002 (ACT) s 94(2); Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 10(2); Civil Liability Act 2003 (Qld) s 45(2); Civil Liability Act 1936 (SA) s 43(2). Civil Liability Act 2003 (Qld) s 45(3). Civil Liability Act 2002 (NSW) s 54(2). Additional complications can arise in the context of self-defence: ss 52–53 prescribe the circumstances in which the defendant’s act of selfdefence can prevent or limit the plaintiff’s damages recovery even though the defendant’s conduct was an offence. Civil Liability Act 1936 (SA) s 43(4)(c). Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 9. Public Health and Wellbeing Act 2008 (Vic) s 154. Drugs Misuse and Trafficking Act 1985 (NSW) s 36P. Civil Liability Act 2002 (WA) ss 5AAA–5AAD (Pt 1CA). Drugs Misuse and Trafficking Act 1985 (NSW) s 36P. This is an ‘independent, not for profit think tank’: see (accessed 11 July 2017). Civil Law (Wrongs) Act 2002 (ACT) ss 37–38. See also diverse provisions concerning terrorism, such as Motor Accidents Compensation Act 1999 (NSW) s 15A; Motor Accident Insurance Act 1994 (Qld) ss 4B, 5; Motor Vehicles Act 1959 (SA) s 99(3a); Motor Accidents (Liabilities and Compensation) Act 1973 (Tas) ss 2A, 14(4)(c). Civil Law (Wrongs) Act 2002 (ACT) ss 11A–11B; Civil Liability Act 2002 (NSW) ss 58A– 58C; Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 7A; Civil Liability Act 2003 (Qld) ss 38A–38C; Civil Liability Act 1936 (SA) s 74A; Civil Liability Act 2002 (Tas) ss 35D–35F; Wrongs Act 1958 (Vic) ss 31E–31H; Volunteers and Food and Other Donors (Protection from Liability) Act 2002 (WA): in Western Australia, grocery products, such as personal hygiene products, household cleaning and medical products that can be sold without prescription are also covered. Civil Law (Wrongs) Act 2002 (ACT) s 5; Civil Liability Act 2002 (NSW) ss 55–58; Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 8; Civil Liability Act 2003 (Qld) ss 25–27; Law Reform Act 1995 (Qld) ss 15–16; Civil Liability Act 1936 (SA) s 74; Civil Liability Act 2002 (Tas) ss 35A–35C; Wrongs Act 1958 (Vic) ss 31A–31D; Civil Liability Act 2002 (WA) ss 5AB–5AE. See also Western Australia’s newly enacted Pt 1CA: protection provided to staff who provide emergency assistance (in good faith and without recklessness) to school children. Civil Law (Wrongs) Act 2002 (ACT) s 5(2)(a); Civil Liability Act 1936 (SA) s 74(4)(a). Civil Liability Act 2002 (NSW) s 58(1). Contrast s 31B(3) of the Wrongs Act 1958 (Vic), which provides that a good Samaritan is protected from liability ‘even if the emergency or accident was caused by an act or omission of the good samaritan’. Civil Liability Act 2002 (NSW) s 58(3). Wrongs Act 1958 (Vic) s 31B(4). Commonwealth Volunteers Protection Act 2003 (Cth); Civil Law (Wrongs) Act 2002 (ACT) ss 6–11; Civil Liability Act 2002 (NSW) ss 59–66; Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 7; Civil Liability Act 2003 (Qld) ss 39–44; Volunteers Protection Act 2001 (SA); Civil Liability Act 2002 (Tas) ss 44–49; Wrongs Act 1958 (Vic)

37 38 39 40 41

42

ss 34–42; Volunteers and Food and Other Donors (Protection from Liability) Act 2002 (WA). See, for example, Wrongs Act 1958 (Vic) s 35; Volunteers and Food and Other Donors (Protection from Liability) Act 2002 (WA) s 4(1). Civil Law (Wrongs) Act 2002 (ACT) s 7(2); Civil Liability Act 2002 (NSW) s 62; Civil Liability Act 2003 (Qld) s 40. Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 7(6). Civil Liability Act 2002 (NSW) s 61(b); Civil Liability Act 2003 (Qld) s 39(1)(b). Commonwealth Volunteers Protection Act 2003 (Cth) s 6(2)(a); Civil Law (Wrongs) Act 2002 (ACT) s 8(2)(a); Civil Liability Act 2002 (NSW) s 66; Civil Liability Act 2003 (Qld) s 44; Volunteers Protection Act 2001 (SA) s 4; Civil Liability Act 2002 (Tas) s 47(2); Wrongs Act 1958 (Vic) s 38(2); Volunteers and Food and Other Donors (Protection from Liability) Act 2002 (WA) s 6(2)(b). Civil Liability Act 2002 (NSW) s 65; Civil Liability Act 2003 (Qld) s 43.

[page 625]

12 Assessment of Damages for Personal Injuries Objectives After finishing this chapter, you should: — understand the consequences of the fact that damages are awarded ‘once and forever’ in personal injury cases; — be aware of how heads of damage are used to calculate an award of damages; — be aware of the main heads of damage for pecuniary loss; — understand on what basis damages are awarded to compensate for the need for hospital and care expenses; — understand on what basis damages are awarded to compensate for loss of earning capacity; — have a basic understanding of how taxation and superannuation are taken into account when assessing damages; — have a working knowledge of the concept of the present value of a future loss; — understand why damages for future pecuniary losses are discounted to present value; — understand in what circumstances damages are awarded to compensate for the cost of fund management; — understand in what circumstances reference to previously decided cases is permitted when awarding damages for non-pecuniary loss; — be aware of the main heads of damage for non-pecuniary loss;

— understand which heads of damage are assessed on a purely subjective basis, which on a purely objective basis, and which on a combination of subjective and objective criteria; — have a working knowledge of which collateral benefits reduce the amount of an award of damages and which do not.

[page 626]

Key cases — Bradburn v Great Western Railway Co (1874) LR 10 Exch 1 — Cattanach v Melchior (2003) 215 CLR 1; 199 ALR 131 — CSR Ltd v Eddy (2005) 226 CLR 1; 222 ALR 1 — Cullen v Trappell (1980) 146 CLR 1; 29 ALR 1 — Graham v Baker (1961) 106 CLR 340 — Griffiths v Kerkemeyer (1977) 139 CLR 161; 15 ALR 387 — Harriton v Stephens (2006) 226 CLR 52; 226 ALR 391 — Hines v Commonwealth (1995) Aust Torts Reports ¶81-338 — Kars v Kars (1996) 187 CLR 354; 141 ALR 37 — Mann v Elbourn (1974) 8 SASR 298 — National Insurance Co of New Zealand Ltd v Espagne (1961) 105 CLR 569 — Planet Fisheries Pty Ltd v La Rosa (1968) 119 CLR 118 — Sharman v Evans (1977) 138 CLR 563; 13 ALR 57 — Skelton v Collins (1966) 115 CLR 94; [1966] ALR 449 — Todorovic v Waller; Jetson v Hankin (1981) 150 CLR 402; 37 ALR 481 — Van Gervan v Fenton (1992) 175 CLR 327; 109 ALR 283

— Wynn v New South Wales Insurance Ministerial Corporation (1995) 184 CLR 485; 133 ALR 154 — Zheng v Cai (2009) 239 CLR 1; 261 ALR 481

Key legislative developments — In all jurisdictions, the Civil Liability or Wrongs Acts place limits and/or ceilings on the recovery of damages for pecuniary losses. — In all jurisdictions, except the Australian Capital Territory, the Civil Liability or Wrongs Acts prescribe the figure to be used for discounting future losses to present value. — In all jurisdictions, the Civil Liability or Wrongs Acts place limits and/or ceilings on the recovery of damages for non-pecuniary losses.

The ‘Once and Forever’ Principle 12.1 If the plaintiff persuades the court, on the balance of probabilities, that her or his injuries were caused by the defendant’s negligence, the court orders the defendant to compensate the plaintiff by payment of a sum of money, known [page 627] as ‘damages’. The basic principles underlying an award of damages for personal injury were described as follows by Gibbs CJ and Wilson J in Todorovic v Waller (1981) 150 CLR 402 at 412; 37 ALR 481 at 486: In the first place, a plaintiff who has been injured by the negligence of the defendant should be awarded such sum of money as will, as nearly as possible, put him in the same position as if he had not sustained the injuries. Secondly, damages for one cause of action must be recovered once and forever, and (in the absence of any statutory exception) must be awarded as a lump sum; the court cannot order a defendant to make periodic payments to the plaintiff. Thirdly, the court has no

concern with the manner in which the plaintiff uses the sum awarded to him; the plaintiff is free to do what he likes with it. Fourthly, the burden lies on the plaintiff to prove the injury or loss for which he seeks damages.

12.2 In order to put the plaintiff ‘in the same position as if he [or she] had not sustained the injuries’, the court must try to measure, in money terms, the difference in the plaintiff’s position before and after she or he suffered the consequences of the defendant’s negligence. That comparison played a central role in the next two cases. Although the facts of the two cases may seem similar at first sight, there is an important difference between them, one that explains the difference in outcome. There is no inconsistency between the two cases in terms of the principles applied. In both cases, the court had to imagine what would have happened if the negligence of the defendant had not occurred, then compare it with the situation that actually transpired. The difference between the cases lies in the court’s ability to measure the ‘before and after’ contrast in money terms. Key Case Cattanach v Melchior (2003) 215 CLR 1; 199 ALR 131 Facts: The first plaintiff became pregnant and gave birth to a child after the defendant had performed a tubal ligation (sterilisation) operation on her. She and her husband sued the defendant, claiming that he had performed the operation negligently, and seeking damages for the costs of raising the child, their third. Issue: Had the plaintiffs suffered any compensable loss as a result of giving birth to a healthy child that they had not wanted? Decision: By a majority of four to three, the High Court of Australia held that the plaintiffs were entitled to damages for the reasonable costs of raising and maintaining the child. McHugh and Gummow JJ said (at [67]–[68]): [I]t [is not] correct to say that the damage that the [plaintiffs] suffered was the parent– child relationship or the coming into existence of the parent–child relationship. To do so is to examine the case from the wrong perspective. In the law of negligence, damage is either physical injury to person or property or the suffering of a loss measurable in money terms or the incurring of expenditure as the result of the invasion of an interest recognised by the law … [F]or the purpose of this appeal, the relevant damage suffered by the [plaintiffs] is the expenditure that they have incurred or will incur in the future, not the creation or existence of the parent-child relationship. If, for example, their child

[page 628] had been voluntarily cared for up to the date of trial, they could have recovered no damages for that part of the child’s upbringing. And, if it appeared that that situation would continue in the future, then the damages they would be able to recover in the future would be reduced accordingly. The unplanned child is not the harm for which recompense is sought in this action; it is the burden of the legal and moral responsibilities which arise by reason of the birth of the child that is in contention. The expression ‘wrongful birth’ used in various authorities to which the court was referred is misleading and directs attention away from the appropriate frame of legal discourse. What was wrongful in this case was not the birth of a third child to [the plaintiffs] but the negligence of [the defendant]. The majority rejected the defendant’s arguments that the plaintiffs’ loss should be reduced by a sum of money representing the positive benefits of having a third child, even though her birth was unplanned. McHugh and Gummow JJ said (at [90]): In assessing damages, it is impermissible in principle to balance the benefits to one legal interest against the loss occasioned to a separate legal interest. The benefits received from the birth of a child are not legally relevant to the head of damage that compensates for the cost of maintaining the child … [T]he head of damages that is relevant in the present case is the financial damage that the parents will suffer as the result of their legal responsibility to raise the child. The benefits to be enjoyed as a result of having the child are not related to that head of damage. The coal miner, forced to retire because of injury, does not get less damages for loss of earning capacity because he is now free to sit in the sun each day reading his favourite newspaper. Likewise, the award of damages to the parents for their future financial expenditure is not to be reduced by the enjoyment that they will or may obtain from the birth of the child.

Key Case Harriton v Stephens (2006) 226 CLR 52; 226 ALR 391 Facts: The plaintiff was born with severe disabilities, which were the result of the fact that her mother suffered rubella during pregnancy. The defendant was the mother’s doctor. He failed to diagnose the plaintiff’s mother’s rubella. If he had done so, the plaintiff’s mother would have sought to terminate the pregnancy. The plaintiff sued the defendant, alleging that the losses she suffered as a result of her disabilities were caused by the defendant’s negligence in failing to diagnose her mother’s rubella. Issue: Had the plaintiff suffered any compensable loss as a result of being born with

rubella? Decision: By a majority of six to one, the High Court of Australia held that the plaintiff did not have a cause of action against the defendant. Crennan J (with whom Gleeson CJ, Gummow and Heydon JJ agreed) said (at [264]–[265]): Providing compensation if liability is established is the main function of tort law; compensation is ‘[t]he one principle that is absolutely firm, and which must control all else’ [Skelton v Collins (1966) 115 CLR 94 at 128 per Windeyer J]; if the principle cannot be applied the damage claimed cannot be actionable. … It can be accepted that mere difficulty in the calculation of damages is not a bar to recognising a cause of action, especially when damages conventionally awarded in [page 629] personal injuries can assist. However, it is not possible on the facts of this case to apply the compensatory principle. [The plaintiff’s] condition before the alleged breach of duty of care by [the defendant] was that she was a foetus affected by rubella. The comparison which is called for on the agreed facts is a comparison between her life with disabilities and the state of non-existence in which she would have been, absent the doctor’s alleged carelessness in failing to advise her mother, which advice would have led her mother to obtain a lawful abortion. It is not that the comparison is difficult or problematic. It is impossible …

12.3 Cattanach’s case (see 12.2) has been reversed by statute in New South Wales, Queensland and South Australia, where courts cannot award damages for the costs ordinarily associated with rearing or maintaining a child born as a result of a failed medical procedure or negligent medical advice,1 although the provisions in New South Wales and South Australia provide that there can be recovery if the child is born with a disability as a result of the defendant’s negligence.2 12.4 Cases like Cattanach (see 12.2) are sometimes described as ‘wrongful birth’ cases. Cases like Harriton (see 12.2) are sometimes described as ‘wrongful life’ cases. Generally speaking, parents can recover the costs of raising children that they did not want (‘wrongful birth’ cases) if the birth of the unwanted child was caused by the negligence of a doctor in performing a sterilisation operation or a

poorly-handled in vitro fertilisation: see, for example, G and M v Armellin [2009] ACTCA 6. Conversely, children cannot recover the cost of being born with a disability (‘wrongful life’ cases) because of the difficulty of calculating the ‘before and after’ question in relation to their alleged loss: how can one calculate the difference in value between a life with a disability and no life at all? 12.5 The court’s award of a lump sum ‘once and forever’ inevitably involves a considerable amount of speculation about what the plaintiff’s life will be like in the future. If the plaintiff’s condition worsens, she or he cannot return to the court for an increase in the sum awarded. Conversely, if the plaintiff’s condition improves or is cured, the defendant cannot return to the court to ask for some money back. In Lim Poh Choo v Camden and Islington Area Health Authority [1980] AC 174 at 182–3, Lord Scarman (with whom Lords Diplock, Dilhorne and Simon of Glaisdale agreed) said: The award is final; it is not susceptible to review as the future unfolds, substituting fact for estimate. Knowledge of the future being denied to mankind, so much of the award as is to be attributed to future loss and suffering — in many cases the major part of the award — will almost surely be wrong. There is really only one certainty: the future will prove the award to be either too high or too low.

[page 630] Similarly, in Palmer v Roads and Traffic Authority [2002] NSWSC 34 at [6], Wood CJ at CL described the process of assessing future damages as ‘a disquieting exercise in crystal ball gazing’. 12.6 In all jurisdictions, except the Australian Capital Territory, the court may make a consent order for a ‘structured settlement’, if the parties agree.3 A structured settlement is an agreement that provides for all or part of a damages award to be paid in periodic payments funded by an annuity or other agreed means.4 In the Northern Territory, a structured settlement may also take the form of an agreement for periodic payments in respect of future reasonable expenses for medical, hospital, pharmaceutical or attendant care

services, payable as those expenses are incurred.5 The legislation in the Northern Territory, South Australia, Tasmania, Victoria and Western Australia simply provides that the court may make an order for a structured settlement if the parties consent.6 In New South Wales and Queensland, the court must take a more active role by informing the parties if it intends to make an award for future loss of more than $100,000, so that the parties may then have a reasonable opportunity to make a structured settlement agreement.7 In both states, refusal by the plaintiff to accept a reasonable offer of a structured settlement may lead to an award of court costs against the plaintiff.8 In all seven jurisdictions, other than the Australian Capital Territory, the court can only depart from the ‘once and forever’ lump sum award if both parties agree to the structured settlement. The effect of payment by purchase of an annuity is that the plaintiff continues to receive periodic payments from the issuer of the annuity until she or he dies, which means that the total amount received by the plaintiff depends on the length of her or his life. The income from the annuity is not taxed as income in the plaintiff’s hands: see the Taxation Laws Amendment (Structured Settlements and Structured Orders) Act 2002 (Cth), which amended the Income Tax Assessment Act 1997 (Cth) and made various consequential amendments. 12.7 In South Australia, the Supreme Court Act 1935 (SA) s 30B provides that the court may adjourn the final assessment of the award of damages until the extent of [page 631] the plaintiff’s continuing disability can be more precisely determined. If the court adjourns final assessment of damages in this way, it makes a declaratory judgment determining liability, and orders the defendant to make periodic payments to the plaintiff pending the final assessment of damages. (For an example of this system in operation, see Walker v Tugend (1981) 28 SASR 194.)

In Western Australia, the court has discretion to order periodic payments instead of a lump sum in cases arising from motor accidents, under the Motor Vehicle (Third Party Insurance) Act 1943 (WA) s 16(4). In cases not governed by these limited statutory provisions, the common law ‘once and forever’ principle still applies in its full rigour.

Terminology 12.8 In making an award of damages, the court distinguishes between ‘special’ and ‘general’ damages. ‘Special’ damages compensate for losses that can be proved with relative precision. For example, the plaintiff should be able to prove exactly how much money she or he has spent on hospital and medical expenses between the accident and the trial. In contrast, ‘general’ damages are awarded to compensate for losses that cannot be proved precisely. All losses that the plaintiff will suffer in the future form part of general damages, as they cannot now be calculated with any precision. General damages are not only made up of future losses, though. For example, damages to compensate the plaintiff for her or his pain and suffering form part of general damages, whether they are for pain and suffering between the accident and the trial or for future pain and suffering, as in neither case can they be calculated with precision. 12.9 Another fundamental terminological distinction is that between ‘pecuniary’ and ‘non-pecuniary’ losses (sometimes called ‘economic’ or ‘non-economic’ losses). ‘Pecuniary’ losses are those that are in some way related to money. For example, hospital and medical expenses are pecuniary losses, because they involve out-of-pocket expenditure by the plaintiff. The plaintiff’s loss of earning capacity is also a pecuniary loss, as it is the loss of her or his ability to earn money. In contrast, ‘non-pecuniary’ losses are those that do not arise from expenditure of, or loss of, money. For example, if the plaintiff has lost her or his eye as a result of the defendant’s negligence, the loss of

the eye itself is not a pecuniary one, although it may cause pecuniary losses. 12.10 The distinction between pecuniary and non-pecuniary losses cuts across the distinction between general and special damages. Damages for non-pecuniary losses always form part of general damages, because they cannot be calculated precisely. Damages for future pecuniary losses form part of general damages, but damages for pecuniary losses between accident and trial form part of special damages (if they are adequately proven). 12.11 In addition to the general binary distinctions between general and special damages and pecuniary and non-pecuniary losses, the courts commonly divide [page 632] awards of damages into components, known as ‘heads of damage’, for ease of identification. For example, the major heads of general damages are usually hospital, medical and care expenses, and loss of earning capacity. Although it is usual (and acceptable) to think and write in terms of these ‘heads of damage’, it is important to remember that they are not fixed legal categories, but are merely convenient ways of describing and understanding how the size of the final, global award is determined. In Teubner v Humble (1963) 108 CLR 491 at 505, Windeyer J said: [I]t is important to remember that an amount to be awarded for general damages is a single amount that is appropriate in the circumstances of the case, and it is not the sum of rigidly separate and independent items. … The conventional headings, economic loss, deprivation of amenities, and pain and suffering, provide a convenient reminder of matters that ought not to be forgotten. But it is not always appropriate, I think, to consider them as if they were distinct items in a balance sheet; for one may overlap and impinge on another.

However, because a judge is required to give reasons for her or his decision, it is usually necessary not only to break the award up into heads of damage, but also to explain how the figure for each head of

damage was reached. In CSR Readymix (Australia) Pty Ltd v Payne [1998] 2 VR 505 at 508, Winneke P of the Victorian Court of Appeal said: [I]t remains true that an assessment of damages made by a judge is not as inscrutable as an assessment made by a jury … Unlike the jury, the trial judge is expected to give reasons for the assessment which he makes and, in a case like this where damages are claimed under several heads, it is usually desirable that the reasons should descend to some degree of particularity in respect of each head of damage.

(This statement of principle was adopted by the Western Australian Court of Appeal in Westrac Equipment Pty Ltd v King [2004] WASCA 188 at [30] and by the Court of Appeal of the Australian Capital Territory in O’Brien v Noble (2012) 6 ACTLR 132.) Thus, although a jury may take a ‘broad brush’ approach to come up with a single figure without step-by-step explanation, a judge may not. If she or he does so, an appeal court may order a re-trial of the question of assessment of damages: see, for example, Rosstown Holding Pty Ltd v Mallinson (2000) 2 VR 299 at [30]–[32] per Callaway JA (with whom Chernov JA agreed).

Pecuniary Losses 12.12 All jurisdictions have passed legislation removing or limiting the right to recover damages for pecuniary losses or placing ceilings on the amounts that can be awarded: see the summary in the tables at 12.66 and 12.86. In order to understand the reason for, and effect of, that legislation, it is necessary first to understand the general principles applicable to the assessment of damages for pecuniary losses at common law. The sections that follow first explain the common law principles, then set out the effect of the legislation limiting the operation of those principles. [page 633]

Hospital, medical and care expenses

12.13 The basic principle underlying an award of general damages for future hospital, medical and care expenses is that the plaintiff is compensated for all expenses that it would be reasonable to incur in treating her or his injuries or in coping with her or his disabilities. In determining whether a particular expenditure is reasonable in the circumstances, the court weighs the cost against the health benefit to the plaintiff. Key Case Sharman v Evans (1977) 138 CLR 563; 13 ALR 57 Facts: The plaintiff, a woman aged 20, was severely injured in a motor vehicle accident caused by the negligence of the defendant, her fiancé. She became quadriplegic and epileptic, lost the power of speech and suffered severe respiratory impairment. At first instance, the Supreme Court of New South Wales awarded the plaintiff damages in the sum of $300,547.50, which included a sum of $150,000 to $170,000 for future costs of nursing and medical care. The award was confirmed by a majority of the New South Wales Court of Appeal. The defendant appealed to the High Court of Australia. Issue: Was the award of damages excessive? Decision: By a majority of three to two, the High Court of Australia held that the award of damages was excessive, and that it should be reduced to $270,500. In considering the award of damages for future nursing and medical care, Gibbs and Stephen JJ (with whom Barwick CJ agreed) noted that the cost of caring for the plaintiff at home would far exceed the cost of caring for her in hospital. They said (at CLR 573–4; ALR 65–6): The appropriate criterion must be that such expenses as the plaintiff may reasonably incur should be recoverable from the defendant; as Barwick CJ put it in Arthur Robinson (Grafton) Pty Ltd v Carter (1968) 122 CLR 649 at 661; [1968] ALR 257 at 267: ‘The question here is not what are the ideal requirements but what are the reasonable requirements of the [plaintiff]’. … The touchstone of reasonableness in the case of the cost of providing nursing and medical care for the plaintiff in the future is, no doubt, cost matched against health benefits to the plaintiff. … The present case is … a case of alternatives in which the difference in relative costs is great whereas the benefit to the plaintiff of the more expensive alternative is entirely one of amenity, in no way involving physical or mental wellbeing. … The benefit to the plaintiff of being cared for at home rather than in hospital is not any benefit to her health but rather to her future enjoyment of life which would be enhanced by a home atmosphere; her life would not thereby be prolonged nor would her physical condition be at all improved; indeed she would be somewhat more at risk physically at home than in hospital. … In these

circumstances the future cost of reasonable nursing and medical attention must, we think, be assessed on the basis of a lifetime spent substantially in hospital. As Gibbs and Stephen JJ recognised that the plaintiff would be unhappier if she spent the rest of her life in hospital, they increased the component for loss of enjoyment of life by $20,000, while reducing the component for hospital and medical expenses to $128,000.

[page 634] 12.14 In contrast, if the court is of the view that there will be significant health advantages if the plaintiff is cared for at home, it will award damages on that basis: see, for example, Government Insurance Office (NSW) v Mackie (1990) Aust Torts Reports ¶81-053; Burford v Allan (1993) Aust Torts Reports ¶81-226; Rosecrance v Rosecrance (1995) 105 NTR 1; Grimsey v Southern Regional Health Board (1997) 7 Tas R 67, affirmed on appeal (1998) 8 Tas R 166; Mules v Ferguson [2014] QSC 51. In Grimsey’s case, Wright J went so far as to award the plaintiff the cost of building a specially designed home in which her needs could be cared for, a decision that was affirmed on appeal by a Full Court of the Supreme Court of Tasmania. 12.15 The fact that the court assessed damages in Sharman’s case (see 12.13) on the basis that she would spend the rest of her life in hospital did not mean, of course, that she was obliged to do that. In fact, June Evans went home from hospital to live with her mother as soon as she was able to do so. The court is not concerned with how the plaintiff chooses to spend the award of damages. The award is not increased if the plaintiff plans, in fact, to spend more on care than the court regards as reasonable in the circumstances. That is one of the consequences of the ‘once and forever’ nature of an award of damages: see 12.1. 12.16 Conversely, common law principles suggest that there should be no reduction in damages if there is evidence that the plaintiff does

not, in fact, intend to spend any money on the provision of medical and nursing services. Key Case Griffiths v Kerkemeyer (1977) 139 CLR 161; 15 ALR 387 Facts: The plaintiff, who had been catastrophically injured by the defendant’s negligence, required constant nursing care for the rest of his life. The evidence showed that that nursing care would be provided by the plaintiff’s fiancée and family at no cost to the plaintiff. The defendant argued that the award of damages should not include any component for hospital and care expenses, because the plaintiff had not actually incurred any such expenses in the past and would not incur any in the future. Issue: Should the plaintiff be awarded damages equal to the cost of providing hospital and care expenses? Decision: The High Court of Australia held that the award should include a sum representing the value of the nursing services provided by the plaintiff’s fiancée and family, even though the plaintiff would not be required to pay for those services. Mason J said (at CLR 192–3; ALR 412–13): The [plaintiff’s] relevant loss is his incapacity to look after himself as demonstrated by the need for nursing services and this loss is to be quantified by reference to the value or cost of providing those services. The fact that a relative or stranger to the proceedings is or may be prepared to provide the services gratuitously is not a circumstance which accrues to the advantage of the [defendant]. … [T]he true loss is the loss of capacity which occasions the need for the service. In consequence the existence of a legal liability to pay [for that service] is not the dominant consideration.

[page 635] 12.17 The true basis of an award of Griffiths v Kerkemeyer damages (as they became known) and the correct method of quantifying them were explained in the next case. Key Case Van Gervan v Fenton (1992) 175 CLR 327; 109 ALR 283

Facts: The plaintiff was injured in a motor vehicle accident caused by the negligence of the defendant. As a result of his injuries, he was in need of almost constant care, which was provided by his wife, who gave up her employment as a nurses’ aide to care for her husband fulltime. At first instance, the Supreme Court of Tasmania calculated the value of the Griffiths v Kerkemeyer component of the award of damages on the basis of the net wages that would be forgone by the plaintiff’s wife over the period that she would probably continue to care for him. Issues: How should Griffiths v Kerkemeyer damages be calculated? On the basis of the wages forgone by the plaintiff’s wife or on the basis of the market cost of the care services provided? Decision: The High Court of Australia held that the Griffiths v Kerkemeyer component of the plaintiff’s damages should be calculated on the basis of the market cost of the caring services provided by the plaintiff’s wife. Mason CJ, Toohey and Gaudron JJ said (at CLR 333–4; ALR 287–8): [I]t should now be accepted that the true basis of a Griffiths v Kerkemeyer claim is the need of the plaintiff for those services provided for him or her and that the plaintiff does not have to show, as Gibbs J held [in Griffiths] that the need ‘is or may be productive of financial loss’. … Once it is recognised that it is the need for services which gives the plaintiff the right to an award of damages, it follows that the damages which he or she receives are not determined by reference to the actual cost to the plaintiff of having them provided or by reference to the income forgone by the provider of the services. … Because the market cost of services is ordinarily the reasonable and objective value of the need for those services, the market cost, as a general rule, is the amount which the defendant must pay as damages. But in some cases the market cost may be too high to be the reasonable value of the services. … Where there is no relevant market for the services or the market cost is objectively too high to be reasonable, the income forgone may be a starting point in cases where the nature and duration of the services provided and the previous work and hours of the care provider are roughly comparable, but such cases are likely to be rare.

12.18 Van Gervan’s case made it clear that Griffiths v Kerkemeyer damages compensate for what is, in essence, a pecuniary loss, namely the money value of the need for services. The pecuniary nature of Griffiths v Kerkemeyer damages was emphasised again in Grincelis v House (2000) 201 CLR 321; 173 ALR 564, where the High Court of Australia held that interest should be awarded on past damages under this head. The function of an award of interest is to compensate a plaintiff for the loss that she or he has suffered by being made to wait for her or his money during the period between the injury and the

court’s final judgment: see MBP (SA) Pty Ltd v Gogic (1991) 171 CLR 657 at 663; 98 ALR 193 at 196. At first instance [page 636] in Grincelis, a Supreme Court Master had refused to award interest on the past Griffiths v Kerkemeyer component of the plaintiff’s damages, on the ground that the plaintiff was not kept out of pocket in relation to that component, because he did not have to pay for the gratuitous services rendered by his family. The High Court in Grincelis said that that was the wrong approach. Van Gervan showed that the true basis of Griffiths v Kerkemeyer damages was not the actual financial loss suffered by the plaintiff, so the fact that the plaintiff was not out of pocket was immaterial. The commercially valuable need for services was felt from the moment of the injury, so interest should be awarded on the sum representing the value of that need. 12.19 The result in Grincelis v House has been reversed by statute in New South Wales, Queensland and the Northern Territory, where a court cannot award the payment of interest on damages awarded for gratuitous services.9 12.20 Griffiths v Kerkemeyer damages are awarded even if the gratuitous services are provided to the plaintiff by the defendant: Kars v Kars (1996) 187 CLR 354; 141 ALR 37 (see 12.100). This often happens when one spouse negligently injures another and subsequently cares for the injured spouse. 12.21 Although Van Gervan’s case (see 12.17) stressed strongly that Griffiths v Kerkemeyer damages are paid to compensate the plaintiff and not the provider of care, the plaintiff obviously has at least a moral obligation to pay the carer once the damages have been received from the defendant. In Jones (by his next friend Jones) v Moylan (1997) 18 WAR 492, a Full Court of the Supreme Court of Western Australia held that in some cases the court can order that a sum for past care be paid directly to the carer. In Jones, the plaintiff was a young boy whose

father sued the defendant on his behalf, under a procedure by which the father was called the boy’s ‘next friend’. The father had also cared for the boy. The court held that it could and should order payment to the father of damages for past care, even though the rest of the damages award was to be paid to the Public Trustee to be held on trust for the boy. Similar payments to the provider of gratuitous services have been made in other jurisdictions too: see Marinko v Masri (2000) Aust Torts Reports ¶81-581 (NSWCA); Protective Commissioner v D (2004) 60 NSWLR 513 (NSWCA); Public Trustee (ACT) v Thompson (2000) 155 FLR 18 (ACTSC); Singh v Calvary Hospital ACT Inc (2008) 220 FLR 352 (ACTSC). However, in Huet v Irvine [2003] QSC 387, the Supreme Court of Queensland held that the care providers had no legal entitlement to payment out of a settlement sum paid to the plaintiff for gratuitous services; any payment is in the court’s discretion. 12.22 State and territory legislatures have not viewed Griffiths v Kerkemeyer damages with much enthusiasm. The only Australian jurisdiction that has not legislated to restrict the award of Griffiths v Kerkemeyer damages is the Australian Capital Territory. [page 637] In New South Wales, the Northern Territory, Queensland and Victoria, Griffiths v Kerkemeyer damages cannot be awarded unless there is a reasonable need that arose solely because of the injury and unless the services would not have been provided but for the injury.10 Thus, for example, no damages would be recoverable in these jurisdictions for the value of care provided by a parent to an injured child, except to the extent that that care goes beyond what the parent would have provided to the child in any event. However, the Queensland legislation specifically provides that damages are not to be awarded for any gratuitous services if gratuitous services of the same kind were being provided for the plaintiff before the injury.11 On its face, this would seem to suggest that Griffiths v Kerkemeyer damages

should not be awarded even if the extent of the caring services is much greater after the accident than before. In New South Wales, the Northern Territory and Victoria (but not Queensland), the maximum amount of damages is limited to average weekly earnings in the relevant state, or, if services are provided for fewer than 40 hours per week, an hourly rate calculated from average weekly earnings.12 In Victoria, the Wrongs Act 1958 (Vic) s 28IA(2) provides that Griffiths v Kerkemeyer damages may not be awarded if the services are provided or are to be provided ‘(a) for less than 6 hours per week; and (b) for less than six months’. In Alcoa Portland Aluminium Pty Ltd v Victorian Workcover Authority (2007) 18 VR 146, the Victorian Court of Appeal read this to mean that the prohibition on awarding Griffiths v Kerkemeyer damages does not apply unless both (a) and (b) are satisfied — that is, unless the gratuitous care is given for less than six hours a week and for less than six months. In other words, if care is given for less than six hours a week but for more than six months (or vice versa), damages can be awarded because the prohibition in s 28IA(2) does not apply. The New South Wales Court of Appeal adopted the same interpretation in Harrison v Melhem (2008) 72 NSWLR 380, overruling an earlier decision, Geaghan v D’Aubert (2002) 36 MVR 542. The New South Wales legislation was promptly amended to read that damages may not be awarded unless the services are to be provided ‘(a) for at least 6 hours per week, and (b) for a period of at least 6 consecutive months’.13 In Coles Supermarkets Australia Pty Ltd v Tormey [2009] NSWCA 135 at [82], Ipp JA of the New South Wales Court of Appeal (with whom Giles and McColl JJA agreed) recognised that the effect of the amendment was to reverse Harrison v Melhem. The position is the same in Queensland as in New South Wales: in Grice v Queensland [2006] 1 Qd R 222, the Queensland Court of Appeal interpreted the subsection in the same way as the Victorian Court of Appeal did in Alcoa (indeed, Alcoa followed Grice) but the legislation was subsequently amended

[page 638] to read as the New South Wales legislation does, thus reversing the effect of Grice.14 The Northern Territory legislation has always read that damages cannot be awarded unless the services are provided or are to be provided ‘(a) for 6 hours or more per week; and (b) for 6 months or more’.15 Thus, to summarise, in New South Wales, Queensland and the Northern Territory, Griffiths v Kerkemeyer damages cannot be awarded unless the gratuitous services are given for more than six hours a week and for more than six months. In Victoria, Griffiths v Kerkemeyer damages can be awarded if the gratuitous services are given for more than six hours a week or for more than six months. The amended New South Wales provision was interpreted in Hill v Forrester (2010) 79 NSWLR 470. There, the New South Wales Court of Appeal held, by a majority, that the ‘intensity threshold’ of six hours a week is a continuing requirement, so that damages cannot be awarded for any period, however long, when services are given for fewer than six hours a week. However, if the ‘duration requirement’ of six months is met, damages must be paid for all periods in which gratuitous care was provided for more than six hours a week, even if they were for periods shorter than six months and even if they occurred before the period in which the duration requirement was met. The court said that the subsection requires ‘urgent legislative attention’ (see at [16] per Tobias JA, [63] per Handley AJA), but there has been no further legislative action since 2008. 12.23 In South Australia and Western Australia, Griffiths v Kerkemeyer damages can only be awarded for services provided by someone in a pre-existing close relationship with the injured person: in South Australia, the ‘parent, spouse, domestic partner or child of the injured person’ and in Western Australia, ‘a member of the same household or family’ as the injured person.16 In both states, the damages are limited in amount by reference to state average weekly earnings,17 and in Western Australia there is a lower threshold below

which damages cannot be awarded.18 Like the provisions in New South Wales, the Northern Territory, Queensland and Victoria (see 12.22), the Western Australian provision states that damages are not recoverable if the services would have been provided to the injured person even if she or he had not suffered the injury.19 12.24 In Tasmania, the only restrictions on Griffiths v Kerkemeyer damages are a threshold similar to that in New South Wales, the Northern Territory and Queensland (see 12.22) — that is, the services must have been provided or are likely to be provided to the injured person for more than six hours per week and for more than six consecutive months — and a cap, limiting damages by reference to average weekly earnings.20 This reverses the previous position in Tasmania, which [page 639] used to be the only state to prohibit the award of Griffiths v Kerkemeyer damages altogether:21 see Potts v Frost (2012) 22 Tas R 103. 12.25 In Tasmania and Victoria, Griffiths v Kerkemeyer damages cannot be awarded at all in actions for injuries sustained in motor vehicle accidents.22 In the Northern Territory, there are statutory provisions stipulating the level of short-term benefits and long-term benefits for attendant care services for injuries sustained in motor vehicle accidents.23 12.26 In New South Wales, the Northern Territory, Tasmania, Victoria and Western Australia, damages may only be awarded for ‘gratuitous attendant care services’ (or words to similar effect), which confines the award of damages to the kind of services provided in Griffiths v Kerkemeyer itself.24 In Potts v Frost (2012) 22 Tas R 103, a Full Court of the Supreme Court of Tasmania held that the relevant phrase in the Tasmanian legislation (‘services of a domestic nature or services relating to nursing or attendance’) did not extend to financial services, such as paying for the injured person’s needs or giving the

injured person the funds to pay for a need. In Queensland and South Australia, the legislative provisions simply refer to ‘gratuitous services’, without further defining that term.25 The next case is concerned with the breadth of the term and the scope of the damages that may be awarded. Case Example Clement v Backo [2007] 2 Qd R 99 Facts: The plaintiff was injured in an accident caused by the defendant’s negligence. Before the accident, the plaintiff had worked on a commercial timber plantation on his own land, planting trees, driving a tractor, fertilising and pruning. After the accident, the plaintiff was unable to perform those activities, so his wife did them. The plaintiff claimed damages for the value of the wife’s work as ‘gratuitous services’ under the Queensland legislation recognising and limiting the award of Griffiths v Kerkemeyer damages (Civil Liability Act 2003 (Qld) s 59). Issue: Did the plaintiff’s wife’s work on the timber plantation count as ‘gratuitous services’? Decision: The Queensland Court of Appeal held that damages should be awarded in respect of the plaintiff’s wife’s gratuitous services in the timber plantation.

[page 640] 12.27 If the plaintiff is a parent, any continuing disability may impair her or his ability to care for her or his children. The loss of the ability to provide child care is clearly compensable, as it is the loss of something that parents value. How should that loss be valued, though? Should it be compensated in general damages, along with the other heads of damage that cannot be quantified precisely, like pain and suffering? Or should it be compensated using the Griffiths/Van Gervan approach, calculating the market cost of providing child care services to substitute for those formerly provided by the plaintiff parent? The latter approach comes very close to providing a benefit to the children, rather than the plaintiff: the plaintiff is given enough money to hire a substitute carer for them. Nevertheless, the New South Wales Court of

Appeal (in Sullivan v Gordon (1999) 47 NSWLR 319) and the Queensland Court of Appeal (in Sturch v Willmott [1997] 2 Qd R 310) adopted the Griffiths/Van Gervan approach in such cases. A Full Court of the Supreme Court of South Australia (in Weinert v Schmidt (2002) 84 SASR 307) and a Full Court of the Supreme Court of Western Australia (in Maiward v Doyle [1983] WAR 210) took the opposite view, holding that damages for loss of the ability to provide child care are only to be compensated in general damages. (The Western Australian Court of Appeal later followed Sullivan without referring to its own earlier decision in Maiward: see Thomas v Kula [2001] WASCA 362.) The High Court of Australia decisively resolved the dispute in the next case, by rejecting the rule in Sullivan v Gordon. Key Case CSR Ltd v Eddy (2005) 226 CLR 1; 222 ALR 1 Facts: The plaintiff developed mesothelioma as a result of exposure to asbestos dust in his workplace. He sued his employer, who admitted liability. The damages awarded by the Dust Diseases Tribunal of New South Wales included an amount of $164,850 for the plaintiff’s loss of capacity to care for his disabled wife. Issues: Should the plaintiff’s loss of the ability to care for his wife be compensated and, if so, how? Decision: The High Court of Australia held unanimously that the damages for loss of the plaintiff’s ability to care for his wife should not have been awarded and that the rule in Sullivan v Gordon forms no part of Australian common law. Gleeson CJ, Gummow and Heydon JJ (with whom Callinan J agreed on this point) distinguished Griffiths v Kerkemeyer, saying (at [21], [23]): Griffiths v Kerkemeyer damages are awarded to plaintiffs to compensate them for the cost (whether actually incurred or not) of services rendered to them because of their incapacity to render them to themselves, not to compensate them for the cost of services which because of their incapacity they cannot render to others. In each instance there may be a “need” for services, but it is a different kind of need, and the recipient of the services is different. … It follows that so far as the reasoning in Sullivan v Gordon rested on the view that a Sullivan v Gordon claim has the same basis as a Griffiths v Kerkemeyer claim, it is [page 641]

erroneous. It cannot be said that the Sullivan v Gordon problem falls within the rules stated in the Griffiths v Kerkemeyer line of cases, or within any proposition logically deducible from those rules. The court rejected the plaintiff’s arguments based on analogy with Griffiths v Kerkemeyer and public policy. Gleeson CJ, Gummow and Heydon JJ (with whom Callinan J agreed on this point) concluded (at [67]–[68]): [I]f it is desired to confer the rights recognised in Sullivan v Gordon on plaintiffs, the correct course to follow is that taken in the Australian Capital Territory and Scotland: to have the problem examined by an agency of law reform, and dealt with by the legislature if the legislature thinks fit. … All the Australian cases supporting Sullivan v Gordon as a principle of Australian common law should be overruled.

12.28 As noted in the last quotation from the judgment of Gleeson CJ, Gummow and Heydon JJ in Eddy (see 12.27), the Australian Capital Territory has passed legislation providing that damages can be awarded for loss of the capacity to perform domestic services for a member of the injured person’s household.26 In 2006, after Eddy’s case was decided, New South Wales passed similar legislation, effectively restoring the position as stated in Sullivan v Gordon.27 Queensland has also reversed the effect of Eddy’s case in limited circumstances, allowing an award of damages for loss of the ability to provide gratuitous domestic services if the requirements in the statute are satisfied.28 Tasmania enacted similar legislation with effect from 2014.29 12.29 Before Eddy’s case (see 12.27) was decided, Victoria had passed legislation limiting any award of damages for loss of the capacity to provide care for others. Because Eddy’s case decided that damages of that kind are not recoverable at common law, the Victorian provisions were left with no work to do (see CSR Ltd v Eddy (at [52], [54]) per Gleeson CJ, Gummow and Heydon JJ), so they were amended in 2015 (finally, a decade after Eddy’s case) to give the court a statutory power to award damages ‘[d]espite anything to the contrary at common law’.30 12.30

You might think that Van Gervan v Fenton (see

12.17)

provides a

justification for ignoring Medicare benefits when assessing damages for hospital, medical and care expenses: the court should assess the plaintiff’s need for care without considering whether the plaintiff actually has to pay for care. Until 1996, Medicare benefits were not payable if the patient had received (or was entitled to receive) compensation for the cost of future medical and nursing services in legal proceedings. Thus, Medicare benefits were not taken into account in assessing damages, simply because they were not (or should not have been) paid to the plaintiff in such a case. [page 642] Since 1 February 1996, when the Health and Other Services (Compensation) Act 1995 (Cth) came into force, Medicare benefits are now payable even if the patient has received or is entitled to receive an award of damages. However, Medicare benefits should still simply be ignored, because the Act also provides that the Commonwealth can recover any Medicare payments from a person who has received an award of damages: see s 8 and 12.93. Similarly, benefits paid by private health insurers are not taken into account when assessing damages for hospital, medical and care expenses, because they are recoverable by the insurer under a doctrine known as ‘subrogation’, which is explained further in 12.90.

Loss of earning capacity 12.31 It is often the case that the plaintiff’s ability to earn is affected by the injuries the defendant has caused. The plaintiff is compensated for that loss of earning capacity: the court compares the plaintiff’s preaccident earning capacity with her or his post-accident earning capacity, and awards damages to represent the difference. Where the plaintiff has not been completely disabled, the extent of the plaintiff’s post-accident earning capacity is often a matter of intense disagreement, with the plaintiff saying that there is little or no work that she or he can now do, and the defendant saying that there are

many jobs still open to the plaintiff. Where the plaintiff has established a prima facie case that she or he has been rendered unemployable, the defendant must do more than merely assert the contrary: she or he must produce evidence to suggest that the plaintiff could be employed in some capacity and what her or his earnings would be (see, for example, Woodhead v Barrow (1993) Aust Torts Reports ¶81-238; AFA Airconditioning Pty Ltd v Mendrecki (2008) 101 SASR 381 at [291] per Layton J). 12.32 All jurisdictions have passed legislation limiting the amount of damages that may be awarded under this head, in most cases by reference to average weekly earnings. In all jurisdictions except South Australia, the court must disregard the plaintiff’s loss of earning capacity to the extent that it would have produced earnings of more than three times average weekly earnings, as calculated by the Australian Statistician for the jurisdiction in question.31 (The Australian Bureau of Statistics publishes average weekly earnings as of November each year. In November 2016, the national average weekly total earnings figure for full-time adult employees was $1,533.10.32) For product liability actions under the Australian Consumer Law, the equivalent figure is twice national weekly earnings.33 In South Australia, damages for loss of earning capacity are limited to a prescribed maximum, which is adjusted [page 643] by reference to the Consumer Price Index.34 (In the first quarter of 2017, the limit was $3,254,350: see the table in 12.66.)35 In Tuohey v Freemasons Hospital (2012) 37 VR 180, the Victorian Court of Appeal held that, given the wording of the relevant legislation, the court is required to disregard the plaintiff’s ‘without injury’ earnings if they exceed three times average weekly earnings, regardless of whether the plaintiff’s post-injury earnings remain above the weekly average. Thus if, as in Touhey, the plaintiff’s post-accident weekly earnings remain above the average, she or he is not entitled to recover damages at all,

notwithstanding the diminution of her or his earnings, because the post-accident figure is higher than the maximum pre-accident figure that the court is allowed to take into account. Because of these statutory limits on recovery, the court’s application of the common law principles described in 12.33–12.52 is significant only if the amount of damages awarded under this head would be less than the statutory limit. 12.33 In theory, compensation under this head is for loss of the capital asset of the ability to earn, rather than for loss of income in the form of earnings. This distinction was made clear by Barwick CJ in Arthur Robinson (Grafton) Pty Ltd v Carter (1968) 122 CLR 649 at 658; [1968] ALR 257 at 264: The [plaintiff] is not to be compensated for loss of earnings but for loss of earning capacity. However much the valuation of the loss of earning capacity involves the consideration of what moneys could have been produced by the exercise of the [plaintiff’s] former earning capacity, it is the loss of that capacity, and not the failure to receive wages for the future, which is to be the subject of fair compensation. In so saying, I realise that many statements may be found in the reported cases where loss of earnings has been the description of this element in special damages. But I do not find that in these it was necessary to consider or draw the distinction between the loss of earnings and the loss of earning capacity. But where in Australia attention has been drawn to the distinction, authoritative expressions with which I respectfully agree have indicated that it is loss of earning capacity and not loss of earnings that is to be the subject of compensation.

12.34 One consequence of the focus on loss of earning capacity, rather than lost earnings, is that a reduction in the award under this head is made on account of what are known as ‘contingencies’ or ‘the vicissitudes of life’. The court does not assume that the plaintiff would be able to exercise her or his earning capacity for the whole of the rest of her or his working life. In most cases, the court assumes that the plaintiff would not be able to exercise her or his earning capacity for the whole of the rest of her or his working life, because of contingencies such as illness, unemployment, redundancy and so on. [page 644]

12.35 The proper approach to assessing ‘vicissitudes’ was explained in the next case.

contingencies

or

Key Case Wynn v New South Wales Insurance Ministerial Corporation (1995) 184 CLR 485; 133 ALR 154 Facts: The plaintiff was a successful businesswoman in a highly paid job with a strong prospect of promotion. She was injured by the defendant’s negligence to such an extent that she had to leave her job and her career. After the accident, she was able to do only some part-time work for a family-owned business. At first instance, the trial judge awarded her damages of just under $1 million, using a figure of 5 per cent for contingencies, which balanced the negative possibility that the plaintiff might have left the workforce for two years to have children against the positive possibility that she might have been promoted if she had not been injured. On appeal, the Court of Appeal of New South Wales held that there should be a discount of 28 per cent for contingencies: 8 per cent to take into account the prospect of having children, and 20 per cent to take into account the possibility that the plaintiff might have chosen or been forced to accept a less demanding job. Issue: How should the percentage for contingencies reflect what the plaintiff’s future prospects would have been if she had not been injured? Decision: On appeal, the High Court of Australia held that the appropriate figure for contingencies was 12.5 per cent. Dawson, Toohey, Gaudron and Gummow JJ said (at CLR 497–8; ALR 161–2): It is to be remembered that a discount for contingencies or ‘vicissitudes’ is to take account of matters which might otherwise adversely affect earning capacity and as Professor Luntz notes, death apart, ‘sickness, accident, unemployment and industrial disputes are the four major contingencies which expose employees to the risk of loss of income’ [Assessment of Damages for Personal Injury and Death, 3rd ed, Butterworths, Sydney, 1990, p 285]. Positive considerations which might have resulted in advancement and increased earnings are also to be taken into account … Finally, contingencies are to be considered in terms of their likely impact on the earning capacity of the person who has been injured, not by reference to the workforce generally. Even so, the practice in New South Wales is to proceed on the basis that a 15 per cent discount is generally appropriate, subject to adjustment up or down to take account of the plaintiff’s particular circumstances. … [T]here was evidence upon which the trial judge might properly form the view that, had the accident not occurred, there was a prospect that the [plaintiff] would have been further promoted within American Express. The argument of the [defendant] to the contrary must be rejected. All that had to be established was ‘a real possibility’ of promotion. The evidence clearly permitted an inference to that effect. And once that inference was drawn by the trial judge, it was necessary for

the prospect of advancement to be taken into account and balanced against the need to take maternity leave. Although it agreed with the approach taken by the trial judge, the High Court used a higher figure for contingencies (12.5 per cent not 5 per cent) to take into account the possibility that the plaintiff’s working life might have been shortened as a consequence of a previous injury.

[page 645] 12.36 In practice, contingencies are usually taken into account as follows. The court takes the amount of the plaintiff’s lost weekly or monthly earnings at the time of the accident (sometimes called ‘the multiplicand’), multiplies it by the number of weeks or months remaining in the plaintiff’s working life (sometimes called ‘the multiplier’), then deducts a percentage of the total to take account of the contingencies, which would have prevented the plaintiff from exercising the lost earning capacity for the whole of the rest of her or his working life. This method was criticised by Barwick CJ in Arthur Robinson (Grafton) Pty Ltd v Carter (at CLR 659; ALR 265), but it is still commonplace. It was used, for example, in Wynn’s case (see 12.35), where it attracted no adverse comment. Thus, in practice, calculation of the value of loss of earning capacity depends — at least until the deduction for contingencies is made — on a calculation of lost earnings, despite the theoretical distinction between the two. It also depends on an assessment of the plaintiff’s pre-accident life expectancy. This is usually done using life expectancy tables produced by the Australian Bureau of Statistics. The Bureau produces two sets of tables: historical tables based on annual information about age at death, and prospective tables, which show what life expectancy might be expected to be in the future, in the light of predicted improvements in life expectancy. In Golden Eagle International Trading Pty Ltd v Zhang (2007) 229 CLR 498; 234 ALR 131, the High Court of Australia held that it is appropriate to use the prospective tables rather than the

historical ones, as the prospective tables are more likely to give an accurate estimate of future life expectancy. 12.37 The deduction for contingencies should reflect the impact that the ‘vicissitudes of life’ would have had on the plaintiff’s earning career if she or he had not been injured, not the impact that they will have on the plaintiff after injury. For example, in Magnou v Australian Wool Testing Authority Ltd [2007] NSWCA 357, the plaintiff suffered occupational asthma as a result of working for the defendant in a dusty environment. The standard New South Wales discount for contingencies is 15 per cent but the trial judge increased this to 30 per cent because there was evidence that the plaintiff’s asthma would be worsened because he continued to smoke tobacco and marijuana. The New South Wales Court of Appeal held that this was incorrect, and that the normal discount of 15 per cent should be applied. The figure for contingencies should only have been increased if there were evidence that the plaintiff’s working life would have been shortened by his use of tobacco and marijuana if he had not contracted asthma as a result of the defendant’s negligence. There was no such evidence, so no further deduction was made. In contrast, in Harrison v Melhem [2008] NSWCA 67, the New South Wales Court of Appeal affirmed the trial judge’s decision that the plaintiff’s heavy drug use before the accident would have significantly reduced his future earnings if he had not been injured. (This part of the court’s decision is not reproduced in the report at (2008) 72 NSWLR 380.) [page 646] 12.38 New South Wales and the Northern Territory have passed legislation directing the approach the court must take in relation to contingencies or ‘vicissitudes’, although neither of those terms is used:36 (1) A court may award damages for future pecuniary loss only if satisfied by the claimant that the assumptions about the injured person’s future earning capacity, or the occurrence of other events on which the award is to be based, accord with the

injured person’s most likely future circumstances had the personal injury not occurred. (2) If a court is satisfied under subsection (1) about the claimant’s assumptions, it must adjust the amount of damages for future pecuniary loss (as assessed on those assumptions) by reference to the percentage possibility that the events might have occurred regardless of the personal injury. (3) In awarding damages for future pecuniary loss, the court must state the assumptions on which the award is based and the relevant percentage by which damages have been adjusted.

In Penrith City Council v Parks [2004] NSWCA 201 at [2], [8], Giles JA and Cripps AJA said that the meaning and effect of this provision are ‘most obscure’. In Jones v Dyldam Developments Pty Ltd [2007] NSWSC 754 at [64], Simpson J said that the section ‘poses real problems of construction’ and that it is a ‘somewhat ineffectual or at least opaque attempt to give statutory formulation to the traditional practice’ of discounting for ‘vicissitudes’. Similar criticisms of the drafting were made in both Macarthur Districts Motor Cycle Sportsmen Inc v Ardizzone (2004) Aust Torts Reports ¶81-744; [2004] NSWCA 145 and Nominal Defendant v Lane [2004] NSWCA 405, but in both cases the New South Wales Court of Appeal held that the section permits an increase of the award of pecuniary loss to take into account positive ‘vicissitudes’ such as prospects of promotion or betterment that the plaintiff might have had in the future if the accident had not occurred. In Penrith City Council v Parks, the New South Wales Court of Appeal held that subs (2) permits a ‘nil adjustment’ if the court concludes that it was likely that the plaintiff would have continued to work without interruption until retirement if the accident had not occurred. (See also Air Manymak v Jeffs [2006] NTCA 12, where the Northern Territory Court of Appeal upheld an award of damages with a nil adjustment for vicissitudes, without referring to the Northern Territory legislation.) The Penrith City Council court went further, holding that it was appropriate to award an additional sum by way of ‘buffer’ in cases where the impact of the injury upon the plaintiff’s earning capacity is difficult to determine. ‘Buffer’ sums are quite frequently awarded in New South Wales to plaintiffs whose future earning prospects at the time of the accident were uncertain.

[page 647]

Taxation and superannuation 12.39 Because damages for loss of earning capacity are almost always, in practice, calculated on the basis of the plaintiff’s actual earnings, the question arises whether the court should use the plaintiff’s gross earnings as the basis for its calculations, or her or his net earnings after deduction of tax. In Atlas Tiles Ltd v Briers (1978) 144 CLR 202; 21 ALR 129, the High Court of Australia held, by a majority of three to two, that in calculating damages for future loss of earning capacity, the court should not take into account the plaintiff’s future liability to pay income tax. In other words, it held that calculations should be done on the basis of the plaintiff’s gross earnings. A Full Court of the High Court of Australia reversed that decision just two years later. Key Case Cullen v Trappell (1980) 146 CLR 1; 29 ALR 1 Facts: The plaintiff was severely injured by the negligence of the defendant. At trial, the award of damages included $45,311 for future loss of earning capacity. On appeal, the Court of Appeal of New South Wales increased that component of the award by $25,971 to $71,282, on the basis that, following Atlas Tiles Ltd v Briers, the trial judge should have had regard to the gross wage lost by the plaintiff rather than his wage net of income tax. The High Court of Australia gave the defendant special leave to appeal, so as to enable it to reconsider its decision in Atlas Tiles Ltd v Briers. Issue: Should damages for loss of earning capacity be calculated using gross or net figures? Decision: By a majority of four to three, the High Court of Australia held that the Atlas Tiles case should no longer be followed, and that the court should take into account notional future income tax in calculating damages for loss of future earning capacity. Gibbs J (with whom Stephen, Mason and Aickin JJ agreed) stated that, on the question of whether income tax should be taken into account, he adhered to what he had said as one of the dissentients in Atlas Tiles, and had nothing to add (see 146 CLR at 11; 29 ALR at 7). Thus, in order to find the judgment of the majority in Cullen’s case on this point, one must turn to Gibbs J’s dissenting judgment in Atlas Tiles. There, he said (at CLR 221–2; ALR 144–5):

Take first the case — probably, in Australia, the most common case — of the plaintiff who receives earnings after tax has been deducted from them. A person cannot be said to have lost something that he would never have received, and a plaintiff in that situation would never have received more than what remained after tax had been deducted, with perhaps a small taxation refund as well — in all, no more than his net earnings. To assess the damages of such a plaintiff on the basis that he has lost his gross earnings seems manifestly unreal, and unduly advantageous to the plaintiff. However, the critics say … it is impossible to foresee future changes in the level of tax, or in the tax laws, or in the situation of the plaintiff himself which may affect the extent to which the lost earnings would have borne tax. There is an element of truth in this criticism, but in the assessment of damages the court is constantly required to endeavour to predict the course of events in the future, and it does not abdicate a necessary function for fear that its predictions may be falsified. To ignore tax altogether would be to assess damages on a basis that would be unreal and theoretical.

[page 648] 12.40 As an award of damages for future loss of earning capacity using net figures takes into account future income tax as part of the calculations, the plaintiff has notionally paid income tax for the rest of her or his working life when she or he receives the award of damages. (That notional payment of tax is made at the tax rate prevailing at the time of the accident, because that is the tax rate that is reflected in the plaintiff’s net earnings at the time of the accident.) If the award of damages itself were to be subject to income tax, the plaintiff would end up paying tax twice: once notionally, in the calculation of the size of the award, and once actually, when assessed to tax on the award of damages. In Atlas Tiles Ltd v Briers (at CLR 223; ALR 145–6), after stating the rule that was eventually adopted in Cullen’s case (see 12.39), Gibbs J said: Dire predictions have been made as to the difficulties and complexities involved in the application of the rule. It has been said that the courts in assessing damages may decide that the award will not be taxable in the hands of the plaintiff, but that the decision will not bind the taxation authorities, who may in fact require the plaintiff to pay tax. If that occurred, of course, the plaintiff’s damages would have been wrongly reduced. However, this objection has proved quite theoretical in the case of awards of damages for personal injuries in Australia. I have already expressed the opinion

that in Australia an award of damages for personal injuries is not taxable: Groves v United Pacific Transport Pty Ltd [1965] Qd R 62. I adhere to that view. Indeed so far as I am aware it has never been seriously challenged. The Commissioner does not attempt to assess tax on awards of damages for personal injuries. He is never likely to do so while the law remains as it is.

12.41 The majorities in the Atlas Tiles and Cullen’s cases agreed that an award of damages for personal injury should not be taxable, but that view is not binding on the Commissioner of Taxation. In 2002, the Australian Taxation Office (ATO) issued an Interpretative Decision (ATO ID 2002/578) stating: Compensation for loss of earning capacity received by the taxpayer is not assessable under section 6-5 of the ITAA 1997 as it is an amount of a capital nature.

An Interpretative Decision is not equivalent to a judicial determination, but it indicates the ATO’s interpretation of the taxation legislation, which is then reflected in the ATO’s practice unless and until there is a binding determination to the contrary by a court. ATO ID 2002/578 was withdrawn by the ATO on 9 September 2016 and has not been replaced at the time of writing. The ATO website says that ‘Guidance on the issue considered in this ATO ID can be found in IT 2193’, which is a Taxation Ruling dated 12 September 1985, concerning taxation of compensation payments made under the then motor vehicle compensation scheme in Victoria. The withdrawal of ATO ID 2002/578 after 14 years is puzzling, but it is unlikely that it signifies a change in the ATO’s practice. The practice of courts continues to be to use net figures to calculate damages for loss of earning capacity. For example, in Air Manymak v Jeffs, the Northern Territory Court of Appeal held that the trial judge had erred in using gross figures rather than net figures to calculate damages for loss of earning capacity. In Pene v Murphy [2004] WASCA 103, the Western Australian Court of Appeal used net [page 649] figures to calculate both past and future loss of earning capacity. In

Locke v Bova [2004] NSWSC 534 at [193], Kirby J made a provisional calculation of loss of earning capacity damages using gross figures, before noting that ‘[t]he gross figures should, of course, be converted to net figures’. In Sydney Refractive Surgery Centre Pty Ltd v Commissioner of Taxation (2008) 247 ALR 313, the Federal Court of Australia was asked to consider whether an award of damages for defamation was taxable. The ATO said it was; the taxpayer said it was not. Because the award was based on profits the taxpayer had lost as a result of the defamation, Sackville J regarded it as ‘conceptually similar’ to an award of damages for loss of earning capacity. Sackville J said this (at [69]): Subject to any relevant statute, an award of damages in a personal injuries claim, even if calculated by reference to lost income, is not income according to ordinary concepts for the purposes of s 6-5 of the ITAA [Income Tax Assessment Act]: Cullen (endorsing the judgment of Gibbs J in Atlas Tiles); Groves [v United Pacific Transport Pty Ltd, referred to in the quotation in 12.40]. The reason is that the award of damages is, in point of principle, for impairment of the plaintiff’s earning capacity and not for loss of income as such: Graham v Baker …

Sackville J’s decision was affirmed on appeal by a Full Court of the Federal Court, which held that damages for loss of earning capacity caused by defamation was not ‘income according to ordinary concepts’ for purposes of the Income Tax Assessment Act 1997 (Cth) s 6–5: see Commissioner of Taxation v Sydney Refractive Surgery Centre Pty Ltd (2008) 172 FCR 557; 253 ALR 59. Although the case was concerned with defamation damages not loss of earning capacity damages in a personal injury context, it gives authoritative support to the interpretation formerly contained in ATO ID 2002/578. 12.42 In Queensland and Victoria, there is legislation to the same effect as Cullen v Trappell, requiring the court to use after-tax figures in calculating damages for loss of earning capacity.37 In Victoria, the Accident Compensation Act 1985 (Vic) sets out the threshold below which there cannot be an award of damages in a common law tort claim for a workplace injury. Section 134AB(38)(f) of that Act provides for calculation of the threshold for loss of earning capacity by reference to gross earnings: see the table in Chapter 1. This provision does not require the court to use gross earnings to calculate

damages for loss of earning capacity once the threshold has been reached. The court switches to a Cullen-like use of net earnings once the threshold has been reached: see, for example, Cakir v Arnott’s Biscuits Pty Ltd [2007] VSCA 104. 12.43 Loss of the ability to work deprives the plaintiff of benefits other than just the payment of wages. Employers commonly pay superannuation benefits for employees, and loss of employment as a result of injury will lead to loss of those benefits. Accordingly, damages are awarded for loss of superannuation benefits under the head of loss of earning capacity. Because employer contributions to superannuation funds are made out of pre-tax dollars, it follows that damages for [page 650] lost superannuation benefits must be calculated on the basis of gross earnings, notwithstanding the rule in Cullen’s case (see 12.39). In Zhang v Golden Eagle International Trading Pty Ltd (2006) 45 MVR 365; [2006] NSWCA 25 at [62] (reversed on other grounds (2007) 229 CLR 498; 234 ALR 131), Basten JA (with whom Ipp and McColl JJA agreed) said: The calculation of superannuation benefits is complicated, in a practical sense, by the fact that the loss of earning capacity will be calculated by reference to likely net earnings, whereas superannuation payments will be calculated by reference to gross earnings, before deduction for income tax. Furthermore, in the case of professionals, who make voluntary payments on account of superannuation, it may be necessary to take care to ensure that loss of earning capacity is not subject to double compensation nor to inadequate allowance for future benefits. In such cases specific actuarial evidence may well be necessary.

Because an employee does not get access to her or his superannuation benefits until retirement, what is awarded is not the total amount that would have been contributed to the superannuation fund, but the present value of that amount, discounted to reflect the plaintiff’s early access to it: see Jongen v CSR Ltd (1992) Aust Torts Reports ¶81-192; Villasevil v Pickering (2001) 24 WAR 167; Zorom

Enterprises v Zabow (2007) 71 NSWLR 354. The concepts of present value and discounting are explained further in 12.56–12.63. 12.44 In New South Wales, Queensland and Tasmania, there is legislation limiting the award of damages for loss of superannuation benefits, which provides:38 (1) The maximum amount of damages that may be awarded to an employee economic loss due to the loss of employer superannuation contributions is relevant percentage of damages payable (in accordance with this part) for deprivation or impairment of the earning capacity on which the entitlement to contributions is based.

for the the the

(2) The relevant percentage is the percentage of earnings that is the minimum percentage required by a written law to be paid on the employee’s behalf as employer superannuation contributions.

(There is similar legislation in South Australia in relation to damages for injuries sustained in motor vehicle accidents.)39 Because this provision limits damages for lost superannuation benefits by reference to a percentage of damages payable rather than actual earnings, a literal reading of subs (1) would lead to the result that damages for lost superannuation benefits would be limited to the ‘relevant percentage’ of damages calculated using net figures (following Cullen), not gross figures. That interpretation was rejected by a majority of the New South Wales Court of Appeal in Najdovski v Crnojlovic (2008) 72 NSWLR 728, which held that, notwithstanding the literal reading of the subsection, the cap should be calculated on the basis of superannuation benefits [page 651] based on gross earnings. Najdovski was followed by the Supreme Court of Tasmania in O’Neill v Rhodes [2016] TASSC 17 and by the Supreme Court of Queensland in Yamaguchi v Phipps (2016) 77 MVR 1; [2016] QSC 151. Subsection (2) limits damages by reference to the minimum percentage of employer contribution permitted by superannuation law,

which is 9.5 per cent from 1 July 2014. That rate will remain static until 30 June 2018, when it will increase by half a percentage point per year until it reaches 12 per cent.

Expenses incurred in order to earn 12.45 When calculating loss of earning capacity, the court should take into account any expenditure that the plaintiff would necessarily have had to incur in order to continue earning her or his pre-accident income. For example, a solicitor cannot legally practise law without a valid practising certificate. For that reason, when calculating the preaccident earning capacity of a solicitor, the pre-accident income projections should be reduced by the cost of the practising certificate, which is an expenditure the solicitor cannot avoid incurring in order to earn that income as a lawyer. In Wynn v New South Wales Insurance Ministerial Corporation (see 12.35), the Court of Appeal of New South Wales held that a similar process of reasoning required it to deduct the cost of child care when calculating what the plaintiff would have earned if she had not been injured, because the plaintiff would not have been able to continue her career after having children unless she paid others to care for her children. The High Court of Australia firmly rejected that view on appeal. Dawson, Toohey, Gaudron and Gummow JJ said (at CLR 496; ALR 160): [T]he cost of child care is simply one of various costs associated with having children. And as such, the cost is properly characterised for the purpose of calculating economic loss, as it is for the purposes of taxation law, as essentially private or domestic in character. So characterised, it is no more to be deducted when calculating loss of earning capacity than are other items of expenditure for personal amenity.

This suggests that only those expenditures that would be deductible for purposes of taxation (like the cost of the solicitor’s practising certificate) should be deducted in the process of calculating damages for loss of earning capacity.

The relationship between damages for loss of earning capacity and damages for hospital, medical and care

expenses 12.46 If the care expenses component of the award is made on the basis that the plaintiff will spend time in hospital, then that component also compensates the plaintiff for the value of the future board, lodging and clothing that will be provided in hospital. But for the accident, the plaintiff would have had to meet board, lodging and clothing expenses out of her or his ordinary income. As a result, the court takes the view that a plaintiff should not receive in full both damages for hospital, medical and care expenses and damages for loss of earning capacity: see Skelton v Collins (1966) 115 CLR 94; [1966] ALR 449. [page 652] Key Case Sharman v Evans (1977) 138 CLR 563; 13 ALR 57 Facts: See 12.13. Issue: Should the plaintiff be awarded damages for loss of earning capacity as well as hospital, medical and care expenses? Decision: The award for loss of earning capacity should be reduced to take into account the fact that the plaintiff’s living expenses were covered by the award of hospital, medical and care expenses, Gibbs and Stephen JJ said (at CLR 575–6; ALR 67–8): We turn next to the question of compensation for lost earning capacity and in particular to an examination of the deductions which should be made in assessing that compensation. … Both principle and authority … establish that where, as here, there is included in the award of damages for future nursing and medical care the plaintiff’s entire cost of future board and lodging, there will be overcompensation if damages for loss of earning capacity are awarded in full without regard for the fact that the plaintiff is already to receive as compensation the cost of her future board and lodging, a cost which but for her injuries she would otherwise have to meet out of future earnings. … She [has] already … been compensated for future board and lodging as a component of hospital expenses, so that to disregard this and award the full sum for lost earning capacity, part of which would be used to provide the very item of board and lodging already compensated for, would be to award compensation twice over.

Loss of earning capacity for non-earning plaintiffs 12.47 In theory, the court awards damages for loss of earning capacity, rather than for loss of earnings, as we have seen. If the court were to take this approach to its logical conclusion, it would award damages for loss of earning capacity whether or not the plaintiff was actually earning at the time of the accident, or would have continued to earn in the future. For example, a woman continues to have earning capacity even if she works in the home for no pay. Logically, if such a woman is injured, she should be awarded full damages for loss of her earning capacity, even though she may have lost no actual earnings as a result of the accident. In practice, though, the courts award damages for the plaintiff’s loss of the ability to exercise her or his earning capacity, rather than for loss of the earning capacity itself. This is often expressed by saying that there should be an award of damages only if the injury produces loss of earning capacity that produces financial loss. In Husher v Husher (1999) 197 CLR 138; 165 ALR 384 [17]–[18], Gleeson CJ, Gummow, Kirby and Hayne JJ made the following statement of ‘basic principles’, which they said were ‘not in doubt’: [T]he inquiry does not stop at what the [plaintiff] could have earned. It is necessary to ask what loss the [plaintiff] suffered because of the diminution of that capacity and that invites attention to what would have happened but for the negligent infliction of injury (as best a court can predict that future course of events). …

[page 653] The financial loss occasioned by impairment of earning capacity is the loss of what (if there had been no accident) the injured plaintiff would (as opposed to could) have expected to have had under his or her control and at his or her disposal by exercising that capacity. We refer to ‘control’ and ‘disposal’ because what the plaintiff has lost are the financial rewards from work that are rewards the plaintiff would have been able to direct to whatever purpose or destination he or she chose. [Emphasis in the original.]

Thus, for example, housewife plaintiffs are usually awarded only small sums for loss of earning capacity, to represent the possibility that

they might, at some time, rejoin the paid workforce: see, for example, Cawrse v Cocks (1974) 10 SASR 10. 12.48 In the Australian Capital Territory, New South Wales, Queensland and Tasmania, damages for loss of the capacity to perform domestic services are recoverable: see 12.28.40 12.49 For the reasons stated in Husher (see 12.47), a plaintiff who is unemployed when injured by the defendant is awarded some damages, on the basis that she or he has lost some capacity to earn in the future, but these awards are usually fairly small, because the plaintiff is not currently exercising that earning capacity: see, for example, Cameron v Sullivan [1962] QWN 32 and Rail Commissioner (formerly Transadelaide) v Warner [2011] SASCFC 90. In Royal Dental Hospital of Melbourne v Akbulut [2002] VSCA 88, the trial judge gave substantial damages to an unemployed plaintiff to compensate for her lost chance to establish a lucrative singing career, but the Victorian Court of Appeal overturned the award on the basis that there was insufficient evidence to support the trial judge’s valuation of the plaintiff’s earning capacity as a singer. In Direen v Coad [2005] TASSC 21, Evans J of the Supreme Court of Tasmania noted that there was ‘no empirical basis’ for an award of damages for loss of earning capacity to an unemployed plaintiff, before concluding: ‘Doing the best I can, I assess his loss in this regard at $50,000’ (at [45]). The assessment of damages was affirmed on appeal: [2005] TASSC 122. 12.50 Similar problems arise in cases involving plaintiffs who were exercising only part of their earning capacity at the time of the accident. For example, in Wege v Elphick (1947) 49 WALR 83, the plaintiff was a qualified engineer, but he preferred to work for much lower wages as a watchmaker. The Supreme Court of Western Australia assessed damages for loss of earning capacity on the basis of the plaintiff’s earning capacity as a watchmaker, notwithstanding the fact that he had also lost the capacity to do better paid work as an engineer. In contrast, in Forsberg v Maslin [1968] SASR 432, the plaintiff worked part of the year as a plant operator, and part of the year as a speedway rider. He earned nothing as a speedway rider. The

Supreme Court of South Australia awarded damages in full, based on the plaintiff’s earning capacity as a plant operator, despite the evidence that he exercised that capacity for only part of the year. It is questionable whether that result is consistent with the ‘basic principles’ stated in Husher: see 12.47. [page 654] 12.51 Queensland has made special legislative provision for the situation ‘[w]hen earnings can not be precisely calculated’: see Civil Liability Act 2003 (Qld) s 55. When earnings cannot be precisely calculated by reference to a defined weekly loss, the court may only award damages for loss of earning capacity if it is satisfied that (s 55(2)): … the person has suffered or will suffer loss having regard to the person’s age, work history, actual loss of earnings, any permanent impairment and any other relevant matters.

If the court does award damages, it must state the assumptions on which the award is based and the method it used to arrive at the award: see s 55(3). The procedure required by this provision is largely indistinguishable from that followed in the other jurisdictions, which still follow the common law. 12.52 In the next case, the court adopted a compromise between ignoring the fact that the plaintiff was not fully exercising her earning capacity at the time of the accident (as was done in Forsberg: see 12.50) and ignoring the fact that damages are, in theory, for loss of earning capacity, not lost earnings (as was done in Wege: see 12.50). Key Case Mann v Elbourn (1974) 8 SASR 298 Facts: The plaintiff was injured when the car she was driving collided with a car driven

by the defendant. At the time of the accident, the plaintiff was employed as a stenographer, but she was only working at about two-thirds of her total capacity, because of other commitments. At first instance, Zelling J stated a case for the consideration of a Full Court of the Supreme Court of South Australia, asking whether the plaintiff should receive damages based on a total loss of earning capacity, or on a two-thirds loss of earning capacity. Issue: How should the plaintiff’s loss of earning capacity be valued? Decision: The Full Court held that damages should be assessed on the basis of loss of the earning capacity that the plaintiff was exercising at the time of the accident and would have probably continued to exercise but for the accident (namely, two-thirds of her full capacity) plus a component to represent the loss of the chance of exercising her earning capacity in full at some time in the future. (See (1974) 8 SASR at 309 per Bright J, with whom Bray CJ and Zelling J agreed.) Note: This method of calculating loss of earning capacity in such a case was approved by McHugh J in Medlin v State Government Insurance Commission (1995) 182 CLR 1 at 19; 127 ALR 180 at 192, and by the New South Wales Court of Appeal in Norris v Blake (by his Tutor Porter) (No 2) (1997) 41 NSWLR 49.

[page 655] 12.53 Although far more women work outside the home than was the case 40 or 50 years ago, it is still by no means unusual for a woman to give up paid employment, at least temporarily, after marriage or after having children. The question of how to take that possibility into account when calculating damages for loss of earning capacity remains controversial. In Sharman v Evans (at CLR 583–4; ALR 74) (see 12.13), Gibbs and Stephen JJ said: Loss must depend upon the likelihood that there would have been a future exercise of that earning capacity, but what of a female plaintiff likely to marry and who may cease to exercise her earning capacity on, or at some time after, marriage? Despite recent changes in patterns of employment of married women this remains a not unusual situation, the woman in effect exchanging the exercise of her earning capacity for such financial security as her marriage may provide. The measure of the one of course bears no necessary relationship to the other and the whole situation must be full of critical uncertainties such as whether the plaintiff marries, the extent if any of her employment after marriage, the success of that marriage and the extent to which it in fact provides her with economic security. Perhaps the only relatively certain factor will be her pre-injury possession of earning capacity and this in itself may be sufficient reason, absent any clear evidence pointing in a contrary direction,

for the adoption of the expedient course of simply disregarding the prospect of marriage as a relevant factor in the assessment of such a plaintiff’s future economic loss; this course at least recognizes the plaintiff’s retention of capacity, which would have been available to her for exercise, in case of need, despite her marriage.

To increase the amount of the award on account of the plaintiff’s loss of the prospect of future marriage would be to ignore the possibility that the plaintiff might never have married even if she had not been injured, or that the marriage might not have lasted, or that the plaintiff’s husband might have been financially dependent on her, or other possibilities that would have produced the result that the marriage would not have provided her with financial stability. Conversely, to decrease the amount of the award on account of those possibilities would be to ignore the possibility that the plaintiff might have entered a marriage that would have given her great financial stability if she had not been injured. Because of these ‘critical uncertainties’, courts often take the same approach as that suggested in Sharman, simply declining to adjust the award of damages for loss of earning capacity either positively or negatively to take into account the prospect of future marriage: see, for example, Government Insurance Office (NSW) v Mackie; Radovanovic v Cutter [2004] ACTSC 9 at [293] per Gray J; Tabet v Mansour [2007] NSWSC 36 at [213]–[217] per Studdert J (reversed on other grounds as Gett v Tabet (2009) 254 ALR 504; reversal on those other grounds affirmed as Tabet v Gett (2010) 240 CLR 537; 265 ALR 227). However, if it is clear from the evidence that the plaintiff would have derived financial benefit from a future marriage and would have continued to exercise her earning capacity after that marriage, then loss of the opportunity to marry deprives her of something of value. In those circumstances, damages may be awarded for loss of the prospect of marriage, as the next case shows. [page 656] Key Case

Hines v Commonwealth (1995) Aust Torts Reports ¶81-338 Facts: The plaintiff was a young unmarried woman who was injured by the defendant’s admitted negligence. Before the accident, she had been engaged to an accountant, but the relationship came to an end after the accident. The plaintiff claimed damages for loss of the opportunity to marry and the financial support that marriage would have brought. Issue: Should loss of the opportunity to marry be compensated by an award of damages? Decision: The Supreme Court of New South Wales awarded the plaintiff $400,000 for loss of the opportunity to marry (in a total award of slightly more than $4 million). Giles J said (at 62,371): Depending upon what occurs (or more accurately is forecast to have occurred or to occur), there may be both loss of support and loss of earnings. If a plaintiff would have worked for the whole of her life but would have had a benefit from a partner’s earnings as well, the plaintiff has lost something … [T]he valuation of the lost chance of support will depend upon the degree of dependency and thus on, amongst other things, comparative earnings, whether there are children and [the former fiancé’s] success in life.

12.54 Hines v Commonwealth was the first reported case in which damages for loss of the opportunity to marry were actually awarded. In two later cases, Partridge v Government Insurance Office (NSWCA, Priestley, Meagher and Cole JJA, 9 October 1995, unreported, BC9505468) and Commercial Union Assurance Co of Australia Ltd v Pelosi (NSWCA, Kirby P, Handley and Sheller JJA, 2 February 1996, unreported, BC9600077), the New South Wales Court of Appeal upheld awards of damages that included a component for loss of opportunity to marry. However, in Rosniak v Government Insurance Office (1997) 41 NSWLR 608, the New South Wales Court of Appeal said that although the award of such damages was ‘uncontroversial in principle’, there was no general rule requiring them to be awarded in all cases involving unmarried women. In Rosniak itself, the only evidence that the plaintiff might have married if she had not been injured was the statistical fact that the majority of Australian women do. The court said that more evidence was necessary, such as the evidence about the fiancé in Hines. The New South Wales Court of Appeal considered and approved these authorities again (obiter) in

Gett v Tabet (2009) 254 ALR 504 (affirmed on other grounds as Tabet v Gett (2010) 240 CLR 537; 265 ALR 227). 12.55 In New South Wales, the Northern Territory and Victoria, the statutory provisions that limit damages for loss of earning capacity (see 12.32) also apply to damages for ‘loss of expectation of financial support’.41 Because these provisions [page 657] refer in general terms to ‘financial support’, they may apply not only in cases of loss of the prospect of marriage, but also to cases of loss of the prospect of entering into other relationships in which financial support could have been found, such as de facto or same-sex relationships. The provisions not only conceive of the possibility of such an award; they also limit the damages that can be awarded in such a case. The limit is the same as in cases of loss of earning capacity — namely, three times average weekly earnings (twice weekly earnings in the case of product liability actions under the Competition and Consumer Act 2010 (Cth)): see 12.32.

Discounting of future pecuniary losses 12.56 A large part of any award of damages is compensation for losses that have not yet been suffered, including, in particular, future pecuniary losses. The court’s task is to award the plaintiff the present value of those future losses. The present value is the sum of money which, if awarded now, would adequately compensate the plaintiff for the future losses. In calculating the present value of a future loss, the court must take into account two main factors: inflation and the ability of money to earn interest. For example, consider the case of a 35-yearold plaintiff who will need hospital and medical attention for the rest of her life, which is expected to last another 30 years. If 30 years’ worth of hospital and medical care will cost $300,000 at today’s prices, should the court award the plaintiff $300,000 now? On the one hand,

the effect of inflation is such that the price of medical services will inevitably increase in the future. On the other hand, the plaintiff will not need to spend all of the $300,000 straight away. She can invest it and earn interest on it until it is needed over the course of the next 30 years. 12.57 In practice, the two factors of inflation and interest largely cancel one another out. If the interest rate received on the lump sum over the next 30 years is equal to the inflation rate, the money will grow in size by interest to the same extent as its real buying power will diminish by reason of inflation, and the net effect will be nil. If the interest rate exceeds the inflation rate for the next 30 years, the lump sum will grow in real terms; conversely, if the inflation rate exceeds the interest rate, the real value of the money will diminish. 12.58 The real interest rate is approximately the difference between the market interest rate and the inflation rate. For example, if safely invested money can earn 8 per cent interest per year at a time when the inflation rate is 5 per cent per year, then it grows by 3 per cent in real terms per year. In the above example, the court should not then award the plaintiff the sum of $300,000, but the sum that would equal $300,000 if it were to grow in real terms by 3 per cent for 30 years. The court would also have to take into account the fact that the money would gradually be spent during the period, so that none would be left in 30 years’ time. 12.59 Although the need for discounting may be clear in principle, a number of practical difficulties arise, particularly in relation to the percentage figure to be used. Economists disagree about what is the real interest rate, because the market interest rate varies according to the relative safety of the investment, and because [page 658] the inflation rate at any one time can be calculated in a number of different ways. Other factors, such as future tax on investment income,

must also be taken into account. Also, the real interest rate fluctuates over time, as inflation and interest rates do not change at the same pace. The World Bank publishes data that show a change in real interest rates in Australia from minus 5.328 per cent in 1975 to 10.068 per cent in 1991 to 5.858 per cent in 2016.42 The real interest rate in Australia changed from 1.044 per cent to 6.321 per cent in the six years between 2009 and 2015, according to World Bank figures. It would be most inconvenient if the courts were required to hear expert evidence from economists at every trial, in order to determine the appropriate discount rate at any particular time. In the next case, the High Court of Australia attempted to settle all questions relating to discounting. Key Case Todorovic v Waller; Jetson v Hankin (1981) 150 CLR 402; 37 ALR 481 Facts: The High Court of Australia considered two appeals together. Each case involved a plaintiff who had suffered catastrophic injuries as the result of the defendant’s negligence. In Todorovic’s case, the trial judge discounted the award of future pecuniary losses using a discount rate of 7 per cent; the Court of Appeal of New South Wales overturned this decision, holding that the award should not be discounted at all. In Jetson’s case, the trial judge offered the jury the option of discounting at 2 per cent or 5 per cent; a Full Court of the Supreme Court of Victoria overturned this decision, holding that the award should be discounted at the rate of 4 per cent. Issue: At what percentage rate should the award for future pecuniary losses be discounted? Decision: The High Court of Australia held, by a majority of five to two, that damages for future pecuniary losses should be discounted at a rate of 3 per cent in all cases. To make this quite clear, the court published a joint statement, which can be regarded as the ratio of the two cases. It read (at CLR 409; ALR 483): In an action for damages for personal injuries, evidence as to the likely course of inflation, or of possible future changes in rates of wages or of prices, is inadmissible. Where there has been a loss of earning capacity which is likely to lead to financial loss in the future, or where the plaintiff’s injuries will make it necessary to expend in the future money to provide medical or other services, or goods necessary for the plaintiff’s health and comfort, the present value of the future loss ought to be quantified by adopting a discount rate of 3 per cent in all cases, subject, of course, to any relevant statutory provisions. This rate is intended to make the appropriate allowance for inflation, for future changes in

rates of wages generally or of prices, and for tax (either actual or notional) upon income from investment of the sum awarded. No further allowance should be made for these matters.

[page 659] 12.60 The 3 per cent discount rate established in Todorovic now applies only in the Australian Capital Territory. All other jurisdictions have passed legislation increasing the discount rate. In New South Wales, the Northern Territory, Queensland, South Australia, Tasmania and Victoria, the discount rate is 5 per cent,43 although in each jurisdiction except Queensland the rate may be changed by regulation.44 For transport and workplace accidents in Victoria, the discount rate is 6 per cent,45 although there is no obvious reason why the present value of a future loss in the economic conditions prevailing in Victoria should be any different in a transport or workplace accident case than in any other case where injury has been sustained. In Western Australia, the discount rate is 6 per cent in all cases, although that, too, may be changed by regulation.46 12.61 Although the change from 3 per cent to 5 per cent or 6 per cent may seem small, it produces a considerable difference in practice, as it must be remembered that the percentages apply for every year for the rest of the plaintiff’s expected life. For example, the present value of $100,000 discounted at 3 per cent for 30 years is $41,200; at 5 per cent for 30 years it is $23,100; at 6 per cent, $17,400.47 12.62 In Rosniak v Government Insurance Office, the plaintiff challenged Todorovic v Waller (see 12.59) and sought to introduce statistical and actuarial evidence to show that the discount figure of 3 per cent was too high. The Court of Appeal of New South Wales firmly rejected that challenge and followed Todorovic. On 13 March 1998, the High Court of Australia refused the plaintiff special leave to appeal against the Court of Appeal’s decision.

12.63 In Mott v Fire and All Risks Insurance Co Ltd [2000] 2 Qd R 34, the Queensland Court of Appeal held that Griffiths v Kerkemeyer damages (see 12.16) for the present value of future gratuitous services should be discounted at the Todorovic v Waller rate of 3 per cent rather than Queensland’s statutory rate of 5 per cent: see 12.60. The effect of Mott’s case was reversed by legislation. The Civil Liability Act 2003 (Qld) s 57 specifically provides that damages for gratuitous services are subject to the statutory discount rate of 5 per cent. In the other legislating jurisdictions, the relevant provisions require discounting whenever an award of damages includes [page 660] a component for any kind of future loss, although the words used in the various statutes differ.48 Similarly, in Waller v James [2013] NSWSC 497, the Supreme Court of New South Wales had to consider whether Cattanach v Melchior (see 12.2) damages for the cost of raising a child should be discounted at the same rate as personal injury damages (which would have been the Todorovic figure of 3 per cent, because the negligence in question occurred before New South Wales adopted the statutory figure of 5 per cent: see 12.60), or at a different discount rate reflecting the fact that the damages are, in essence, to compensate for economic losses. Hislop J held that Cattanach v Melchior (see 12.2) damages should be discounted at the same rate as personal injury damages (which would now be 5 per cent) because the claim ‘is properly categorised as part of a total claim for damages for personal injury’ (at [309]).

Expenses of fund management 12.64 Awards of damages are often very large sums of money, sometimes millions of dollars. Most people do not have the financial expertise to be able to manage and invest such large sums wisely, so they must pay others to do so for them. In Nominal Defendant v

Gardikiotis (1996) 186 CLR 49; 136 ALR 1, the plaintiff argued that the award of damages to her should include a component for the costs of managing the money she had been awarded. She argued that the cost of managing the fund should be taken into account to ensure that the notional investment of her money produced a stream of income equal to the levels assumed by the court when discounting the award. The High Court rejected this argument, holding that damages to cover the cost of managing the award should only be awarded to plaintiffs whose inability to manage the award has been caused by the defendant’s negligence as, for example, in the case of a plaintiff who suffered brain damage as a result of the defendant’s negligence. In Willett v Futcher (2005) 221 CLR 627; 221 ALR 16, the High Court of Australia confirmed the view that it expressed obiter in Gardikiotis, that damages for the expenses of investing and managing the sum received as damages should be made to a plaintiff who has been rendered incapable of managing her or his own affairs as a result of the defendant’s negligence. Gleeson CJ, McHugh, Gummow, Hayne, Callinan and Heydon JJ said (at [51]): In a case, like the present, where a plaintiff must have an administrator appointed to manage his or her financial affairs because the plaintiff’s incapacity to deal with those matters was caused by the defendant’s negligence, the plaintiff is awarded a lump sum of damages which is to compensate the plaintiff for losses past, present and future. In a case, again like the present, where the plaintiff will never be able to manage his or her affairs and will never be able to work, the damages awarded will often include a significant allowance for future economic loss. The plaintiff can make no decision about the fund. An administrator must be appointed. The administrator must invest that fund and act with reasonable diligence. It follows

[page 661] that the administrator will incur expenses in performing those tasks. The incurring of the expenses is a direct result of the defendant’s negligence. The damages to be awarded are to be calculated as the amount that will place the plaintiff, so far as possible, in the position he or she would have been in had the tort not been committed.

In Gray v Richards (2014) 253 CLR 660; 313 ALR 579, the High Court of Australia held that Willetts-style fund management damages should

include a component for the cost of managing the fund management component of the plaintiff’s damages, but should not include a component for the costs associated with managing the predicted future income of the managed fund. 12.65 In South Australia, there is legislation providing that damages are not to be awarded to compensate for the cost of investment or management of the amount awarded: see Civil Liability Act 1936 (SA) s 57. Because this provision is in general terms, it forbids award of such a sum even in the circumstances considered by the High Court of Australia in Willett v Futcher (see 12.64), where the plaintiff is incapable of managing her or his own affairs. Of all the legislative changes made to the common law of damages, this qualifies as perhaps the most heartless.

Summary Table 12.66 The following table summarises some of the most significant changes to the assessment of damages for pecuniary losses. A similar table appears at 12.86, summarising the legislation affecting the award of damages for non-pecuniary losses. Note that the table includes the restrictions imposed by the Competition and Consumer Act 2010 (Cth) Pt VIB, Div 4, which limits the damages that may be awarded in personal injury actions under the products liability provisions in the Australian Consumer Law. Jurisdiction

Australian Capital Territory

New South Wales

Loss of earning capacity

Gratuitous services (Griffiths v Kerkemeyer)

Discount rate

Cap: must not exceed three times average weekly earnings (CL(W)A 2002 s 98(2)). Threshold: none.

No cap/threshold.

No legislation; 3 per cent at common law.

Cap: damages must not exceed three times average weekly earnings (CLA 2002 s 12(2)). Threshold:

Not awarded unless reasonable need, and need is solely because of the injury, and services would not be provided but for the injury

5 per cent unless prescribed by regulations (CLA

none.

(CLA 2002 s 15(2)).

2002 s 14).

[page 662]

Jurisdiction

Loss of earning capacity

Gratuitous services (Griffiths v Kerkemeyer)

New South Wales cont’d

Threshold: no damages unless services are for at least six hours per week and for at least six consecutive months (CLA 2002 s 15(3)). Cap: not to exceed average weekly earnings or (if services for less than 40 hours per week) an hourly rate of onefortieth of average weekly earnings (CLA 2002 s 15(4), (5)).

Northern Territory

Not awarded unless reasonable need, and need is solely because of the injury, and services would not be provided but for the injury (PI(L&D)A 2003 s 23(1)). Threshold: no damages unless services are for at least six hours per week and for six months or more (PI(L&D)A 2003 s 23(2)). Cap: not to exceed average weekly earnings or (if services for less than 40 hours per week) an hourly rate of onefortieth of average weekly earnings (PI(L&D)A 2003 s 23(3), (4)). Court must consider hospital care and other offsetting benefits in assessing services (PI(L&D) A 2003 s 23(5)).

Cap: must not exceed three times average weekly earnings (PI(L&D)A 2003 s 20). Threshold: none.

Cap: must not exceed three times

Not awarded unless necessary, and need is solely

Discount rate

5 per cent unless prescribed by regulations (PI(L&D) A 2003 s 22).

Queensland

average weekly earnings (CLA 2003 s 54(2)). Threshold: None.

because of the injury, and same kind of services were not being provided before accident (CLA 2003 s 59(1)(a), (b), (2)).

5 per cent (CLA 2003 s 57).

[page 663]

Jurisdiction

Loss of earning capacity

Tasmania

Discount rate

Threshold: no damages unless services are for at least six hours per week and for at least six months (CLA 2003 s 59(1)(c)). Cap: none. Court must consider hospital care and other offsetting benefits in assessing services (CLA 2003 s 59(3)).

Queensland cont’d

South Australia

Gratuitous services (Griffiths v Kerkemeyer)

Cap: must not exceed $3,254,350 (CLA 1936 s 54(2) – adjusted for changes in CPI from 2001 September quarter to 2017 September quarter (see definition of ‘prescribed maximum› in CLA 1936 s 3)). Threshold: not awarded for first week off work (CLA 1936 s 54(1)).

Only awarded for services provided by parent, spouse, domestic partner or child of injured person (CLA 1936 s 58(1)). Threshold: none. Cap: must not exceed four times state average weekly earnings (CLA 1936 s 58(2)); if another person reasonably required to render services, damages must not exceed state average weekly earnings (CLA 1936 s 58(3)).

5 per cent unless prescribed by regulations (CLA 1936 ss 3, 55).

Threshold: no damages unless services are for at least six hours per week and for at Cap: must not least six consecutive months exceed three times (CLA 2002 s 28B(2)). average weekly 5 per cent (CLA Cap: rate not to exceed earnings (CLA 2002 s average weekly earnings or (if 2003 s 57). 26(1)).

Threshold: none.

services for less than 40 hours per week) an hourly rate of onefortieth of average weekly earnings (CLA 2002 s 28B(3)).

[page 664]

Jurisdiction

Loss of earning capacity

Gratuitous services (Griffiths v Kerkemeyer)

Tasmania cont’d

Restriction: not recoverable at all for injuries sustained in motor vehicle accidents (CLA 2002 s 28C).

Victoria

Cap: must not exceed three times amount of average weekly earnings (WA 1958 s 28F(2)). Threshold: none.

Not awarded unless reasonable need, and need is solely because of the injury, and services would not be provided but for the injury (WA 1958 s 28IA(1)). Threshold: no damages unless services are for more than six hours per week or for more than six months (WA 1958 s 28IA(2)). Cap: not to exceed average weekly earnings or (if services for less than 40 hours per week) an hourly rate of onefortieth of average weekly earnings (WA 1958 s 28IB). Restriction: not recoverable at all for injuries sustained in motor vehicle accidents (Transport Accident Act 1986 s 93(10)(c)).

Cap: must not

Only awarded for services provided by member of the same household or family of injured person (CLA 2002 s 12(1)). Not awarded if services would have been provided to injured person if the injury had not been suffered (CLA 2002 s 12(2)).

Western Australia

Discount rate

5 per cent unless prescribed by regulations (WA 1958 s 28I); 6 per cent for workplace or transport accidents. (Workplace Injury Rehabilitation and Compensation Act 2013 s 345; Transport Accident Act 1986 ss 93(13), 173(1)).

6 per cent unless prescribed by regulations (Law Reform (Miscellaneous

exceed three times amount of average weekly earnings (CLA 2002 s 11(1)). Threshold: none.

Threshold: $5,000, adjusted annually by reference to CPI Labour Price Index (CLA 2002 ss 12(3), (4), 13).

Provisions) Act 1941 s 5).

[page 665]

Jurisdiction

Loss of earning capacity

Gratuitous services (Griffiths v Kerkemeyer)

Western Australia cont’d

Cap: not to exceed state average weekly earnings or (if services for less than 40 hours per week) an hourly rate of one-fortieth of state average weekly earnings (CLA 2002 s12(5)–(7)).

Commonwealth

Not awarded unless reasonable need, and need is solely because of the injury, and services would not be provided but for the injury (CCA 2010 s 87W(2)). Threshold: no damages unless services are for at least six hours per week and for at least six months (CCA 2010 s 87W(2)(d), (e)). Cap: not to exceed average weekly earnings or (if services for less than 40 hours per week) an hourly rate of onefortieth of average weekly earnings (CCA 2010 s 87W(4), (5)).

Cap: must not exceed two times average weekly earnings (CCA 2010 s 87U).

Non-Pecuniary Losses

Discount rate

5 per cent unless prescribed by regulations (CCA 2010 s 87Y).

General: scales, tariffs and reference to comparable awards 12.67 Non-pecuniary losses are losses that do not arise from expenditure of, or loss of, money. As a result, they cannot be calculated or estimated exactly in money terms, as can pecuniary losses. The court must assign a money value to them, even though they have no money value in themselves. 12.68 Obviously, there is no absolute scale for damages for nonpecuniary loss, in the sense that there is no single correct money value for an arm or a leg or an eye, or for pain and suffering or loss of expectation of life. However, it is possible to construct a relative scale by comparison with other, similar, cases, so that, for example, loss of an arm or a leg or an eye is given approximately the same value in each case. A relative scale of values of this kind is usually called a ‘tariff’. In the following case, the High Court of Australia held that there was no ‘tariff’ for the award of damages for non-pecuniary loss at common law. [page 666] Key Case Planet Fisheries Pty Ltd v La Rosa (1968) 119 CLR 118 Facts: The plaintiff was injured in a motor vehicle accident caused by the negligence of the defendants. At trial, he was awarded damages in the sum of $49,322, of which $40,000 represented general damages. The defendants appealed on the ground that the award of $40,000 for general damages was disproportionate to the plaintiff’s injuries, in the light of awards of damages made in other cases involving similar injuries. Issue: Was it appropriate to consider how much damages had been awarded in other comparable cases? Decision: The High Court of Australia unanimously rejected the proposition that a judge could consider the amount of damages awarded in other cases. It said (at 124–5): It is the relationship of the award to the injury and its consequences as established in the evidence … which is to be proportionate. It is only if, there

being no error, the award is grossly disproportionate to those injuries and consequences that it can be set aside. Whether it is so or not is a matter of judgment in the sound exercise of sense of proportion. It is not a matter to be resolved by reference to some norm or standard supposedly to be derived from a consideration of amounts awarded in a number of other specific cases.

12.69 The rule in Planet Fisheries was often criticised because it was deeply at odds with the way damages were calculated every day in practice, but it was never reconsidered by the High Court of Australia, despite several invitations. Following a recommendation of the Ipp Panel (see Chapter 1), the rule was eventually reversed by statute in every Australian jurisdiction. In the Australian Capital Territory, New South Wales, Tasmania, Victoria and Western Australia there is legislation providing that the court may refer to its own earlier decisions, or to those of other courts, for the purpose of establishing the appropriate award of damages for non-pecuniary loss.49 New South Wales and South Australia have each created a legislative scheme requiring the court to assess where the plaintiff’s non-pecuniary loss lies on a scale from the slightest to the gravest.50 In New South Wales, the scale is from 0 to 100, with 100 being noneconomic loss of ‘the most extreme case’; in South Australia the scale is from 0 to 60, with 60 being ‘non-economic loss of the gravest conceivable kind’. (The Commonwealth has created a similar statutory scale scheme for damages for non-pecuniary loss in personal injury actions under the products liability provisions in the Australian Consumer Law, with the ‘most extreme case’ being defined as ‘noneconomic loss of the gravest conceivable kind’.51) [page 667] Queensland has created a similar but slightly different legislative scheme, requiring the court to assign an ‘injury scale value’ (or ISV) to

the plaintiff’s injury on a scale of 0 to 100, with 100 being ‘injury of the gravest conceivable kind’.52 Under either kind of a scale system the court is necessarily required to compare the plaintiff’s injuries and continuing disability with that suffered by others: see Manning v New South Wales [2005] NSWSC 958, considered below at 12.76. The Queensland legislation specifically states that the court should take into account the ISVs given to similar injuries in previous proceedings,53 and the legislation in the Australian Capital Territory, New South Wales, Tasmania, Victoria and Western Australia also allows the parties or their counsel to bring the court’s attention to previous decisions.54 The Northern Territory has legislated to abolish common law principles of assessment of damages for non-pecuniary loss, replacing them with a method of assessing and awarding damages ‘on the basis of the degree of permanent impairment suffered by the injured person’.55 Courts in the Northern Territory must assess the plaintiff’s degree of permanent impairment as a ‘percentage of the whole person’, then award the relevant percentage of a specified maximum amount.56 Although the process does not explicitly require or permit comparison with other cases, the process of assessment must be done in accordance with evidence given by medical practitioners who have assessed the degree of permanent impairment in accordance with ‘the prescribed guides’, which include the American Medical Association’s Guides to the Evaluation of Permanent Impairment.57 Thus, the Northern Territory process of evaluation necessarily requires indirect comparison with similar cases. In any event, because the legislative scheme replaces the common law, it necessarily replaces the Planet Fisheries rule (see 12.68), which was a common law rule. 12.70 In keeping with the general practice in assessment of damages at common law (see 12.11), damages for non-pecuniary loss are usually itemised under three (sometimes four) separate heads of damage: loss of amenity (with disfigurement sometimes listed as a separate item), pain and suffering, and loss of expectation of life. That method is still in use in the Australian Capital Territory, Tasmania, Victoria and

Western Australia. The principles of assessment under these heads of damages are set out in the sections that follow. [page 668] New South Wales, Queensland and South Australia (and the Commonwealth, in Australian Consumer Law product liability cases) have all adopted methods of assessment that require the court to award a percentage of a specified maximum figure, with the percentage reflecting a single, global assessment of the plaintiff’s condition: see 12.69. However, that does not mean that the common law principles for assessment under the various heads of damage (which are described in the sections that follow) are irrelevant in those four jurisdictions. As we shall see (in 12.76), the court’s analysis is different in the jurisdictions that use a scale, but common law principles are still relevant to some extent. In contrast, the Northern Territory replaced the common law with a scale system (see 12.69), so the common law principles stated in the following sections are irrelevant in that jurisdiction. 12.71 All jurisdictions other than the Australian Capital Territory have passed legislation affecting the amount of damages that can be awarded for non-pecuniary loss. In all jurisdictions, except Tasmania and Western Australia (and, of course, the Australian Capital Territory), the award of damages for non-pecuniary loss is capped, although there are restrictions on damages at intermediate levels in Tasmania and Western Australia. All jurisdictions except Queensland (and, again, the Australian Capital Territory) have also set a threshold, providing that no damages should be awarded if they fall below the specified threshold.58 The effect of the statutory provisions is set out in the table below, at 12.86.

Loss of amenity and disfigurement 12.72

Damages for loss of amenity compensate the plaintiff for any

continuing disability that she or he suffers as a result of the injuries caused by the defendant’s negligence. Although no sum of money can compensate for a lost arm or a lost eye, an award of damages for loss of amenity is designed to compensate for that loss, so far as money can do so. 12.73 In awarding damages for loss of amenity at common law, the court takes into account the extent to which the plaintiff has subjective feelings of loss. A plaintiff who enjoyed playing sports before the accident may receive more for loss of a leg than a plaintiff who led a sedentary existence, because the loss of the limb means more to the former plaintiff than to the latter. In Skelton v Collins (at CLR 113; ALR 463), Taylor J said: [I]n assessing damages for a loss of the amenities of life resulting from the physical destruction or impairment of some part of the body, I find it impossible to ignore,

[page 669] or to regard merely as a minimal factor, what has been referred to as the subjective element. The expression ‘loss of the amenities of life’ is a loose expression but as a head of damages in personal injury cases it is intended to denote a loss of the capacity of the injured person consciously to enjoy life to the full as, apart from the injury, he might have done. [Emphasis in the original.]

12.74 Thus, in Skelton’s case itself (see 12.73), the court awarded only a small sum for loss of amenity, despite the fact that the plaintiff was rendered quadriplegic, because he was permanently unconscious as a result of his injuries, and suffered no subjective feelings of loss. In contrast, the court may occasionally increase the award of damages for loss of amenity on account of the plaintiff’s subjective loss, as the next case shows. Case Example Namala v Northern Territory (1996) 131 FLR 468 Facts: The plaintiff was an Aboriginal woman who had to have a hysterectomy after

giving birth to her first child by a caesarean section that was negligently performed by the defendant’s employees. Issue: How should the plaintiff be compensated for losing her ability to bear any more children? Decision: In assessing the damages to be awarded to the plaintiff to compensate her for her lost fertility, Kearney J took the following factors into account (among others) (at 474): (4) The plaintiff’s subjective suffering resulting from her inability to bear children. (5) The aggravation of the plaintiff’s subjective suffering, by virtue of the cultural importance of having a large number of children within her community … (6) The plaintiff’s subjective suffering, resulting from a loss of cultural fulfilment through inability to fully participate in traditional cultural ceremonies and activities. (Similar awards for loss of cultural fulfilment were made to Aboriginal plaintiffs in Napaluma v Baker (1982) 29 SASR 192 and Dixon v Davies (1982) 17 NTR 31.)

12.75 Damages for loss of amenity may be awarded if the plaintiff is scarred as a result of the accident. This is often referred to as if it were a separate head of damage called ‘cosmetic disability’ or ‘disfigurement’, but it is properly a question of loss of amenity. Although there is a subjective element in damages under this head, the court is not entitled to assume that women subjectively suffer a greater sense of loss as a result of scarring than men do, on the basis of an assumption that women attach greater importance to their appearance: see Ralevski v Dimovski (1987) 7 NSWLR 487. However, the court is entitled to assume, without hearing evidence on the matter, that appearance is subjectively important to a woman: see Del Ponte v Del Ponte (1987) 11 NSWLR 498; Pozgay v E J O’Connor & Sons Pty Ltd [2000] ACTSC 59. [page 670] 12.76 New South Wales and South Australia have each created a legislative scheme requiring the court to assess where the plaintiff’s non-pecuniary loss lies on a scale from the slightest to the gravest: see

12.69.

(The Commonwealth has created a similar legislative scheme for Australian Consumer Law products liability cases: see 12.69.) In the next case, the court considered the relevance of common law principles to the assessment of damages for non-pecuniary loss under the statutory scale system in New South Wales. Case Example Manning v New South Wales [2005] NSWSC 958 Facts: The plaintiff suffered very serious injuries, including brain damage, as a result of being savagely beaten by another prisoner while he was in detention pursuant to an apprehended violence order. He sued the state of New South Wales, alleging that it had been negligent in failing to protect him from the other prisoner. The defendant admitted negligence but contested the amount of damages. In relation to non-pecuniary loss, the defendant relied on Skelton v Collins (see 12.73), arguing that although the plaintiff’s injuries were very severe, they should not be regarded as being close to ‘a most extreme case’ (the statutory formula for the top of the scale in New South Wales: see 12.69), because the plaintiff had little or no subjective appreciation of the extent of his loss of amenity. Issue: In determining how close the plaintiff’s loss of amenity was to a ‘most extreme case’, should the court look only at his subjective experience, or only at the objective extent of what he had lost, or both? Decision:The court’s assessment should look at both objective and subjective factors, with more emphasis placed on the objective extent of loss than had been the case at common law. Hoeben J rejected the defendant’s argument, saying (at [56]–[57]): I am … not persuaded by the defendant’s submission that an assessment of noneconomic loss is essentially a subjective exercise and that objective considerations should be given only minimal weight. That was certainly the situation under the common law. Under the Act, however, courts are required by s 16 to follow a methodology of assessment which of necessity involves reference to a table specifying percentages and which implicitly invites a comparison with other similar injuries. In my opinion that approach injects an additional element of objectivity into the assessment of non-economic loss under the Act which was absent from the common law as considered in such cases as Skelton v Collins. The reference in s 17A to a comparison with other cases confirms that greater weight is required to be given to the objective seriousness of injuries under the Act than under the common law. Nevertheless I accept the main thrust of the defendant’s submission that the subjective effect on each individual of his or her injuries remains the major determinant of the entitlement to damages for non-economic loss under the Act. Taking those matters into consideration I am of the opinion that the plaintiff’s

entitlement to damages for non-economic loss … goes well beyond a mere nominal assessment. I agree that the plaintiff’s reduced appreciation of what he has suffered and what he has lost is a factor to be properly taken into account in reducing the extent of the plaintiff’s entitlement to non-economic loss. Nevertheless, there is sufficient evidence to satisfy [page 671] me that not only has the plaintiff suffered major and significant injuries in an objective sense but that he has some real appreciation, albeit not a complete appreciation, of his injuries and what he has lost. As indicated, every time he eats or seeks to ambulate he is reminded of his disabilities. I would assess the plaintiff’s entitlement to non-economic loss at 80 per cent of a most extreme case …

An objective approach to loss of amenity seems even more clearly to be required by the Queensland legislation, where the court is required to assess the plaintiff’s condition on a scale where the maximum (of 100) is represented by ‘injury of the gravest conceivable kind’: see 12.69. By referring to the gravity of the plaintiff’s injury, rather than the gravity of the plaintiff’s non-pecuniary loss (as in New South Wales and South Australia and Australian Consumer Law products liability cases), the Queensland legislation seems to leave no room at all for the kind of subjective assessment of loss of amenity required by Skelton’s case (see 12.73) and, to a lesser extent, by Manning’s case.

Pain and suffering 12.77 As the name of this head of damage indicates, it compensates for the pain and suffering that the plaintiff has felt and will feel as a result of the accident. Damages under this head are entirely subjective. Thus, in Skelton v Collins (see 12.73), the court awarded no damages under this head to a permanently unconscious plaintiff. Taylor J said (at CLR 108; ALR 460): [I]f a plaintiff’s condition, as a result of his injuries, is such that he is insensible to physical pain and suffering, it would be inappropriate to award damages under this head, the reason for this being simply that a plaintiff in such a condition does not experience pain and, consequently, does not suffer on that account.

12.78 As damages under this head are purely subjective, the plaintiff who suffers less receives less. Thus, an unusually brave or stoical plaintiff receives less for pain and suffering than a plaintiff who succumbs to the misery of her or his condition. The paradoxical nature of this outcome can be avoided by awarding the stoical plaintiff more under the head of loss of amenity, on the basis that the subjective aspect of her or his loss of amenity is greater than that of the miserable plaintiff. In Burke v Batchelor (1980) 24 SASR 33 at 40–1, Wells J said: It may be that a courageous and determined person will not collapse under the weight of pain and suffering that would overwhelm a lesser mortal, and that, on that account, his award will be less than it might otherwise have been under the heading of pain and suffering. But it is essential to bear in mind that that reduction is not the whole story. A man whose spirit is such as to uphold him in such depressing circumstances is a person who lives with an intensity of appreciation and understanding that is denied to most other people. His loss of amenities of life is by so much the greater. Accordingly, what he loses on the swings, he will recover on the roundabouts.

[page 672] 12.79 Although assessment of damages under this head is necessarily imprecise, it cannot be entirely without foundation on the evidence, as the next case shows. Case Example Government Insurance Office (NSW) v Best (1993) Aust Torts Reports ¶81-210 Facts: The plaintiff suffered grief and depression, partly as a result of her own injuries, and partly in response to her husband’s death. Grief about her own injuries was compensable; grief about her husband’s death was not: see Chapter 9. The trial judge held that ‘common human experience’ indicated that the plaintiff’s grief at her husband’s death would have faded with time, and that her continuing depression was mainly a consequence of her own injuries. The defendant appealed. Issue: Had the trial judge acted appropriately in assuming that the plaintiff’s continuing depression was attributable to her own injuries rather than her husband’s death? Decision: On appeal, the Court of Appeal of New South Wales reduced the pain and

suffering component of the award. Clarke JA (with whom Handley JA agreed) said (at 62,102): While I am sympathetic to the trial judge’s approach, I do not believe that it was open to him to act on what he described as ‘common human experience’ in respect of grief-caused depression in this case, primarily because the evidence from the psychiatrists provided no support for that conclusion.

12.80 In New South Wales and South Australia, the plaintiff’s subjective experience of pain and suffering should be taken into account in assessing where the plaintiff’s non-pecuniary loss lies on the statutory scale (see 12.69), according to the principles stated in Manning’s case: see 12.76. (The same should be true for Australian Consumer Law products liability cases: see 12.69.) For example, in Pasvouris v Schmarr (2007) 96 SASR 572, a Full Court of the Supreme Court of South Australia assessed the plaintiff’s pain and suffering at a level of 10 on the statutory scale of 60, so it modified the trial judge’s award of damages for non-pecuniary loss, which had been based on an assessment of pain and suffering at a level of eight. Because the Queensland scale refers only to the plaintiff’s injury, rather than her or his loss (see 12.69), one might have expected the plaintiff’s subjective experience of pain and suffering to play no part in the court’s assessment of the plaintiff’s ‘injury scale value’ (ISV). Nevertheless, the Civil Liability Regulation 2014 (Qld) reg 14(2)provides that in assessing an ISV, a court must treat any ‘adverse psychological reaction’ as a feature of the injury.

Loss of expectation of life 12.81 If the plaintiff’s life has been shortened, she or he is awarded damages to compensate for loss of life expectancy. This is now simply a conventional sum. Formerly, damages under this head were objective, representing the lost years themselves, rather than the plaintiff’s subjective loss of enjoyment of those years. [page 673]

They were awarded in full even if the plaintiff died soon after the accident and suffered no subjective feelings of loss as a result of the lost years: see Rose v Ford [1937] AC 826. This purely objective approach produced the result that the award of damages for loss of expectation of life was often, effectively, an award of damages to the deceased’s surviving family. As a result, the courts soon froze damages under this head to a nominal sum: see Benham v Gambling [1941] AC 157. Now, damages for loss of expectation of life are not calculated solely, or even mainly, on the basis of the length of life that is lost. 12.82 In Sharman v Evans (1977) 138 CLR 563; 13 ALR 57 (for the facts, see 12.13), the trial judge awarded the plaintiff the sum of $6,000 for loss of expectation of life. The High Court of Australia reduced this to $2,000. The sum currently awarded under this head has been around $15,000 for many years. For example, in CSR Ltd v Young (1998) Aust Torts Reports ¶81-468, the New South Wales Court of Appeal noted that $12,500 is an amount commonly awarded under this head to persons in their late 50s, or in their 60s or 70s, and affirmed the trial judge’s award of $20,000 to a younger person. In Hannell v Amaca Pty Ltd [2006] WASC 310 at [347]–[351], Le Miere J awarded what he called the ‘conventional sum’ of $15,000 for a lost expectation of life calculated at 21.78 years. (Le Miere J’s decision was later reversed on grounds concerned with the defendant’s liability, rather than the proper assessment of damages: see Amaca Pty Ltd v Hannell (2007) 34 WAR 109.) In Lowes v Amaca Pty Ltd [2011] WASC 287 at [815]–[818], Corboy J reviewed awards of damages for non-economic loss cases in mesothelioma claims in the Supreme Court of Western Australia, the Dust Diseases Tribunal of New South Wales, and the Australian Capital Territory Supreme Court. In each of the cases reviewed by Corboy J that involved loss of life expectancy, $15,000 was awarded as damages for that head of damage. (Corboy J’s review has been cited by both the Victorian Court of Appeal and a Full Court of the Supreme Court of South Australia: see Amaca Pty Ltd v King [2011] VSCA 447 at [176]; BHP Billiton Ltd v Hamilton (2013) 117 SASR 329 at [320].) 12.83

In New South Wales and South Australia (and in Australian

Consumer Law products liability cases), the plaintiff’s lost life expectancy should be taken into account in assessing where the plaintiff’s non-pecuniary loss lies on the statutory scale of gravity of loss: see 12.69.59 Because the Queensland scale refers only to the plaintiff’s injury, rather than her or his loss (see 12.69), one might expect the plaintiff’s lost life expectancy to play no part in the court’s assessment of the plaintiff’s ISV. However, the Civil Liability Regulation 2014 (Qld) reg 8 provides that in determining an injured person’s ISV, a court should use Sch 4 of the Regulation, which sets out detailed principles for assessing an ISV for a wide range of different types of injury, many of which include a reference to ‘life expectancy’ as a relevant factor. [page 674]

Aggravated and Punitive (or Exemplary) Damages 12.84 Aggravated damages are a special form of compensatory damages. Their purpose is to compensate for injury to the plaintiff’s feelings caused by conduct of the defendant that goes beyond ‘ordinary wrongdoing, of a kind consistent with ordinary human fallibility’: see New South Wales v Riley (2003) 57 NSWLR 496 at [131] per Hodgson JA. Thus, if the plaintiff suffers hurt feelings as a consequence of physical injuries caused by ‘ordinary’ negligence, she or he recovers only ordinary compensatory damages for pain and suffering. (Note that the plaintiff cannot recover damages at all if she or he suffers no more than hurt feelings: see 9.12.) If, however, the defendant’s conduct goes beyond ‘ordinary wrongdoing’, aggravated damages may be awarded at common law to increase the size of the award for hurt feelings. Punitive damages (also known as ‘exemplary damages’) are awarded to punish the defendant and to deter repetition of the tortious

conduct. The court will award punitive damages only if the defendant is guilty of a ‘conscious’ and ‘contumelious disregard’ for the plaintiff’s rights: Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 at 154 per Windeyer J. Aggravated and punitive damages are considered in greater detail in Chapter 19, which is concerned with defences to and remedies for intentional torts. Although the conditions for the award of aggravated and punitive damages are more commonly satisfied in cases of intentional wrongdoing by the defendant, there are examples of aggravated and punitive damages being awarded in negligence actions at common law: see, for example, Backwell v AAA [1997] 1 VR 182, where the Victorian Court of Appeal confirmed an award of punitive damages in an action in negligence against a doctor. 12.85 Aggravated and punitive damages cannot be awarded in any type of action for personal injury in the Northern Territory.60 In New South Wales, aggravated or punitive damages are not recoverable in personal injury cases ‘where the act or omission that caused the injury or death was negligence’.61 Courts in Queensland can only award aggravated or punitive damages in personal injury cases if the act that caused the personal injury was ‘an unlawful intentional act done with intent to cause personal injury’ or ‘an unlawful sexual assault or other unlawful sexual misconduct’.62 It follows that aggravated and punitive damages cannot be awarded in negligence actions in Queensland (unless it is possible to engage in ‘unlawful sexual misconduct’ negligently, which is difficult to imagine). In Victoria, aggravated or punitive damages cannot be awarded in actions arising out of motor vehicle or workplace accidents.63 [page 675]

Summary Table 12.86

The following table summarises some of the most significant

changes to the assessment of damages in relation to non-pecuniary loss. Note that the table includes the restrictions imposed by the Competition and Consumer Act 2010 (Cth) Pt VIB, Div 4, which limits the damages that may be awarded in personal injury actions under the products liability provisions in the Australian Consumer Law. Jurisdiction

Non-pecuniary loss

Aggravated or punitive (exemplary) damages

Australian Capital Territory

Cap: none. Threshold: none.

No restriction if common law criteria are satisfied.

New South Wales

Scale system, awarding percentage of maximum for ‘most extreme case’ of non-pecuniary loss (CLA 2002 s 16). Cap: maximum of $350,000 (in 2002 dollars) for ‘most extreme case’, indexed by reference to average weekly earnings (CLA 2002 ss 16(2), 17). Threshold: 15 per cent of ‘most extreme case’ (CLA 2002 s 16(1)).

No aggravated or punitive damages awarded for negligence causing personal injury (CLA 2002 s 21).

Queensland

Scale system, based on ‘injury scale value’ (ISV) to maximum injury ‘of gravest conceivable kind’ (CLA 2003 ss 61–62). Cap: Sliding scale of maxima for different bands of ISV, with different figures for each tax year (CL Reg 2014, Sch 7). Threshold: no threshold; minimum award $1,440for ISV of 1 out of 100 (CL Reg 2014, Sch 7, Table 7, item 1).

No aggravated or punitive damages awarded for personal injury unless caused by unlawful intentional act or unlawful sexual assault or unlawful sexual misconduct (CLA 2003 s 52).

South Australia

Scale system, based on maximum No restriction if common law of 60 for non-economic loss ‘of criteria are satisfied. gravest conceivable kind’ (CLA 1936 s 52(2)). Cap: $241,500 (in 2002 dollars) for scale value of 60, non-economic loss ‘of gravest conceivable kind’, indexed by reference to Consumer Price Index for Adelaide (CLA 1936 ss 3, 52(2)(c)(vi)).

[page 676]

Jurisdiction

Non-pecuniary loss

Aggravated or punitive (exemplary) damages

South Australia cont’d

Threshold: no award unless injured person’s ability to lead a normal life was significantly impaired for at least seven days and she/he incurred medical expenses of at least $2,750 (in 2002 dollars), indexed by reference to Consumer Price Index for Adelaide (CLA 1936 ss 3, 52(1)).

Tasmania

Maximum: none (CLA 2002 s 27(3)). No restriction if common law Threshold: no award unless criteria are satisfied. damages assessed at $4,000 (in 2004 dollars), indexed by reference to Consumer Price Index for Hobart (CLA 2002 s 27(1), (4)(a)). Restriction: if damages assessed to be between indexed threshold and five times that sum, restricted to 1.25 times amount assessed minus threshold (CLA 2002 s 27(2), (4)(b)).

Victoria

Cap: $577,050 (in 2015 dollars), indexed by reference to Consumer Price Index for Melbourne (WA 1958 ss 28G, 28H). Threshold: no award unless plaintiff suffered ‘significant injury’ (WA 1958 s 28LE) causing impairment of more than a threshold level determined by a Medical Panel (WA 1958 ss 28LB, 28LF, 28LG, Div 5 of Pt VBA): more than 5 per cent for injury (other than psychiatric injury or spinal injury), 10 per cent or more for psychiatric injury, 5 per cent or more for spinal injury.

Not available in actions for transport accidents (Transport Accident Act 1986 (s 93(7)) or workplace accidents (Workplace Injury Rehabilitation and Compensation Act 2013 s 340(c)).

Western Australia

Maximum: none. Threshold: no award unless damagescriteria are

No restriction if common law

satisfied.assessed at $12,000 (in 2003 dollars), indexed by reference to Wage CostIndex for Western Australia (CLA 2002ss 4, 9(1), 10). Restrictions: two bands of restriction, with differing formulae; restrictionscease when damages are assessedto be greater than $48,500 (in 2003dollars), indexed by reference to WageCost Index for Western Australia (CLA2002 ss 4, 9(2), (3), (10)).

[page 677]

Jurisdiction

Non-pecuniary loss

Common-wealth Scale system, awarding percentage of maximum for ‘most extreme case’ of non-pecuniary loss ‘of the gravest conceivable kind’ (CCA 2010 ss 87P, 87Q, 87R). Cap: maximum of $250,000 (in 2004 dollars) for ‘most extreme case’, indexed by reference to Consumer Price Index (CCA 2010 ss 87L, 87M). Threshold: 15 per cent of ‘most extreme case’ (CCA 2010 s 87S).

Aggravated or punitive (exemplary) damages No restriction if common law criteria are satisfied.

Collateral Benefits 12.87 The function of an award of damages in tort is to compensate the plaintiff, not to punish the defendant. If the plaintiff has received compensation from other, ‘collateral’, sources, the amount that the defendant is required to pay the plaintiff may be reduced. In effect, the defendant then receives the benefit of the payment to the plaintiff from the collateral source. Thus, in many cases, the underlying question is: did the collateral source who conferred the benefit on the plaintiff

intend to benefit only the plaintiff or (indirectly) to reduce the amount that the defendant has to pay? Key Case Zheng v Cai (2009) 239 CLR 1; 261 ALR 481 Facts: The plaintiff suffered significant injuries to her back and neck in a car accident caused by the defendant’s negligence. After the accident, the plaintiff performed volunteer work for the Christian Assembly of Sydney for about 20 hours a week. The Christian Assembly paid her about $580 a week. She sued the defendant, seeking damages in relation to her injuries. When assessing damages, the trial judge declined to take into account the sums paid to the plaintiff by the Christian Assembly. The New South Wales Court of Appeal reversed that decision, holding that the sums should be taken into account to reduce the damages payable by the defendant. The plaintiff appealed. Issues: Were the sums paid to the plaintiff by the Christian Assembly to be taken into account so as to reduce the damages payable by the defendant? Were they intended to be a gratuitous benefit to the plaintiff, or were they, in effect, payment for services rendered? Decision: The High Court of Australia held unanimously that the sums paid by the Christian Assembly should not reduce the damages payable by the defendant. French CJ, Gummow, Crennan, Kiefel and Bell JJ said (at [23]): [page 678] The critical question … was whether the payments by the Assembly were intended by it to operate in the interest of the [defendant] and to diminish the damages he otherwise would be liable to pay. The conclusion expressed by [the Court of Appeal] does not address this consideration. Rather, [the Court of Appeal] concluded that the intention was to benefit the [plaintiff] in her circumstances after the accident, but denied the legal consequence … by finding in the Assembly an additional intention with respect to voluntary work. The ‘additional intention’ on the part of the Assembly was to enable the plaintiff to function more effectively as a volunteer church worker. The Court of Appeal had held that this ‘additional intention’ showed that the Assembly’s intention was not merely to benefit the plaintiff, and so the sums should be taken into account to reduce the damages payable by the defendant. The High Court of Australia disagreed about the effect of the Assembly’s ‘additional intention’. French CJ, Gummow, Crennan, Kiefel and Bell JJ said (at [24]) that the Assembly’s ‘additional intention’: … could not substitute for the necessary intention on its part to benefit the [defendant] by diminishing his liability for damages at the expense of the award

recovered by the [plaintiff], the object of the bounty provided by the Assembly. Reducing the [plaintiff’s] award without finding such an intention would defeat rather than advance the policy of the law in this area.

12.88 Although Zheng’s case (see 12.87) illustrates the key question in collateral benefit cases — was the intention of the collateral source to benefit the plaintiff or to reduce the sum payable by the defendant? — it is often difficult to ascertain the intention of the collateral payer. Some benefits are held to reduce the award of damages, others are not. (The cases speak of benefits being ‘set off’ against the award of damages.) Much depends on the nature of the benefit and its source. Accordingly, it is necessary to consider different types of collateral benefit separately.

Accident or other first-party insurance 12.89 If the plaintiff has been prudent enough to buy insurance against the risk of injury in an accident, any benefits that she or he receives from the insurer are not set off against the award of damages. Key Case Bradburn v Great Western Railway Co (1874) LR 10 Exch 1 Facts: The plaintiff, a railway passenger, was injured as a result of the negligence of the defendant, the railway company. Before departing on his journey, the plaintiff had bought insurance against the risk of accident, and he received compensation for his injuries from the insurer. He then sued the defendant. Issue: Should the plaintiff’s damages be reduced by the amount that he had received from his insurer? [page 679] Decision: The Court of Exchequer rejected the defendant’s argument that the benefits that the plaintiff had received from his insurer should reduce the amount that it was required to pay by way of damages. Pigott B said (at 3): [The plaintiff] does not receive that sum of money because of the accident, but because he has made a contract providing for the contingency; an accident must

occur to entitle him to it, but it is not the accident, but his contract, which is the cause of his receiving it.

12.90 It may seem that the plaintiff is then compensated twice: once from her or his insurer and once from the defendant. In practice, that is not so. The action against the defendant is usually brought by the plaintiff’s insurer using the plaintiff’s name, under a doctrine known as ‘subrogation’. Having paid the plaintiff, the insurer is subrogated to the plaintiff’s rights against the defendant — that is, the insurer is entitled to enforce those rights for its own benefit. If an award of damages is made to the plaintiff, the plaintiff’s insurer keeps an amount equal to the sum it has paid the plaintiff, and the plaintiff keeps the rest. 12.91 In Victoria and Western Australia, the legislation regulating the award of damages in personal injury cases specifically provides that it does not apply to any sum payable under ‘any life or other insurance policy’.64 That provides legislative confirmation of the position stated in Bradburn (see 12.89), that insurance proceeds are not to be taken into account in assessing damages.

Social security and other statutory benefits 12.92 If the plaintiff receives an invalid pension in respect of her or his injuries, it is not set off against the award of damages. Key Case National Insurance Co of New Zealand Ltd v Espagne (1961) 105 CLR 569 Facts: The plaintiff became totally blind as a result of a motor vehicle accident caused by the defendant’s negligence. He was granted a Commonwealth disability pension, and the defendant argued that the sums the plaintiff received from his pension should be set off against the award of damages. Issue: Should the damages awarded to the plaintiff be reduced by the amount of his disability pension? Decision: The High Court of Australia rejected the argument that the damages should be reduced by the amount of the pension. Dixon CJ said (at 573):

[T]here may be advantages which accrue to the injured plaintiff, whether as a result of legislation or of contract or of benevolence, which have an additional characteristic. [page 680] It may be true that they are conferred because he is intended to enjoy them in the events which have happened. Yet they have this distinguishing characteristic, namely they are conferred on him not only independently of the existence in him of a right of redress against others but so that they may be enjoyed by him although he may enforce that right: they are the product of a disposition in his favour intended for his enjoyment and not provided in relief of any liability of others fully to compensate him.

12.93 Here, too, there is no possibility of double recovery by the plaintiff, because the Social Security Act 1991 (Cth) Pt 3.14 requires the Department of Social Security to recover any pension payments made to a pensioner who has received compensation in the form of an award of damages. Thus, the defendant pays the plaintiff, who repays the Commonwealth: see s 1178. Indeed, in certain situations, the Commonwealth may recover directly from the defendant (see Div 4, Subdiv C of Pt 3.14), or may require a pensioner to proceed against the person who caused her or his injuries: see s 1166. Similarly, the Health and Other Services (Compensation) Act 1995 (Cth) requires repayment of Medicare benefits by a person who has received a damages award or a settlement: see s 8. Here, too, the end result is that the defendant pays the plaintiff, who repays the Commonwealth, or the Commonwealth recovers directly from the defendant: see s 28. 12.94 In Tuncel v Renown Plate Co Pty Ltd [1976] VR 501 and Redding v Lee (1983) 151 CLR 117; 47 ALR 241, the Supreme Court of Victoria and the High Court of Australia (respectively) held that any unemployment benefits received by the plaintiff should be set off against the award of damages for loss of earning capacity. The plaintiff’s inability to work is not productive of financial loss (see 12.47) if she or he receives unemployment benefits while not working.

12.95 The contrasting outcomes in Espagne’s case (see 12.92) and Redding v Lee (see 12.94) should make it clear that there is not a single answer to the question whether a statutory benefit should be set off against an award of damages. In Manser v Spry (1994) 181 CLR 428 at 436; 124 ALR 539 at 544–5, Mason CJ, Brennan, Dawson, Toohey and McHugh JJ said: To ascertain whether a statutory benefit possesses the ‘distinguishing characteristic’ that it is to be enjoyed independently of, and cumulatively upon, the right to damages, the court must endeavour to discover the intention of the legislature. There are three possible indicia of a relevant legislative intention: the financial source of the benefit, the presence of a provision which requires a repayment of a statutory benefit out of the damages awarded or paid and the nature of the benefit. If a scheme for provision of a benefit be funded by contributions made by employers and employee–beneficiaries as a kind of insurance against misfortune, the principle in Bradburn v Great Western Railway Co indicates that the benefit is to be enjoyed by a beneficiary who encounters the misfortune without reduction of the damages to which he or she is otherwise entitled. That view has been taken of benefits paid under contributory pension schemes created under statute. If statute provides that a

[page 681] particular benefit is to be repaid out of damages, there is a clear indication that that benefit is not to go in reduction of the tortfeasor’s liability. When such a provision relates only to one or some of the benefits provided under the statute, the nonrepayable character of the other benefits may imply, according to the context, either that the legislature intended that the receipt and retention of the benefit should not be taken into account in the assessment of damages or that it had no such intention. Whether an implication of such a legislative intention should be drawn depends largely on the nature of the benefit.

All states and territories have workers’ compensation legislation, providing a no-fault compensation scheme for injuries sustained in the workplace: see Chapter 1. In South Australia and the Northern Territory, the workers’ compensation remedy replaces the common law action for damages, which is no longer available in those jurisdictions: see 1.14 and the table at 1.18. In the other jurisdictions, the workers’ compensation statute provides that benefits paid by an employer to an employee under the legislation are to be taken into account in assessing damages in any common law action brought by the

employee against the employer or reimbursed by the employee after recovery of the full amount of damages at common law: see the ‘Workplace Accidents’ part of the table at 1.18. Similarly, there are statutory no-fault compensation schemes for motor vehicle accidents in New South Wales, the Northern Territory, Tasmania and Victoria: see 1.13. In the Northern Territory, the no-fault remedy replaces the common law action for damages, which is no longer available: see 1.13. In the other three jurisdictions, any no-fault benefits paid under the legislation are to be taken into account in assessing damages in any common law action or reimbursed by the plaintiff after recovery of the full amount of damages at common law: see 1.13 and the ‘Transport Accidents’ section of the table at 1.18.

Employment-related benefits 12.96 If the plaintiff receives sick pay or other leave payments from her or his employer for a period after the accident, that money is set off against the award of damages. In particular, sick pay reduces the amount of special damages for loss of earning capacity. In contrast, pension benefits such as superannuation are not set off against damages. Key Case Graham v Baker (1961) 106 CLR 340 Facts: The plaintiff was injured in an accident caused by the defendant’s negligence. He received full pay from his employer for a period of six months after the accident, although he did no work in that period. He was compulsorily retired 18 months after the accident, and he then began to receive a pension out of a superannuation fund to which he had been contributing. [page 682] Issue: Should the sums received from the plaintiff’s employer and the superannuation fund be set off against the damages payable by the defendant? Decision: The High Court of Australia held that the sick pay should be set off against

the award of damages, but the superannuation should not. With respect to the sick pay, Dixon CJ, Kitto and Taylor JJ said (at 345): It may be true, to some extent at least, that the amount of ‘sick pay’, or to be more precise ‘sick leave”, to which an employee … will become entitled will depend to some extent upon the length of his service. But it is quite wrong to say without qualification that if he is permitted to be absent on leave, or on sick leave, on ‘full pay’ and so relieved of his obligation to perform his duties, the pay which he receives cannot, therefore be regarded as his wages or salary. In contrast, the court held, following Espagne’s case (see 12.92), that the superannuation benefits should not be set off, as they were clearly independent of the plaintiff’s right of redress against the defendant. The plaintiff would have been entitled to his superannuation whatever his reason for retiring.

12.97 In Victoria and Western Australia, the legislation regulating the award of damages in personal injury cases specifically provides that it does not apply to any sum payable under a superannuation scheme.65 That provides legislative confirmation of the position stated in Graham (see 12.96), that superannuation benefits are not to be taken into account in assessing damages. 12.98 Although leave payments are to be set off against the award of damages (see 12.96), loss of leave entitlements may be a compensable loss, so that the net effect is nil. Case Example North v Thompson [1971] WAR 103 Facts: The plaintiff was off work for a period of 32 weeks as a result of injuries he sustained in an accident caused by the defendant’s negligence. During that period, the plaintiff took his annual leave and long service leave, because he needed money for living expenses. Issue: Was the plaintiff entitled to compensation from the defendant for the period of 32 weeks, when he was using up his leave entitlements? Decision: A Full Court of the Supreme Court of Western Australia held that the payments for annual leave and long service leave should be set off against the award of damages for loss of earning capacity. However, the court awarded damages in the same amount for loss of the plaintiff’s entitlement to those periods of leave, because

[page 683] the plaintiff had lost his entitlement to paid annual leave and paid long service leave. The net result was that there was no diminution in the size of the award. Note: This case was followed by the Supreme Court of Queensland in Kenny v Eyears [2003] QSC 439.

Voluntary services and other gratuitous benefits 12.99 In 12.16–12.26, we saw that the plaintiff is entitled at common law to recover damages representing the value of medical and care services, even if those services are provided without charge by friends or relatives (see Griffiths v Kerkemeyer (1977) 139 CLR 161; 15 ALR 387: see 12.16), although the award of such damages has been considerably restricted by statute. The voluntary services provided to the plaintiff by the friends or relatives are a collateral benefit that does not reduce the award of damages, which are based on the market value of the plaintiff’s need for care. The same principles apply in cases not involving personal injury, such as in Powercor Australia Ltd v Thomas (2012) 43 VR 220, where the Victorian Court of Appeal declined to reduce the damages awarded to the plaintiff for damage to his farm suffered in the Black Saturday bushfire of 2009 because much of the repair work had been done by the plaintiff himself and volunteer workers. 12.100 As the next case shows, the situation is no different if the defendant is one of the people providing voluntary services to the plaintiff. Key Case Kars v Kars (1996) 187 CLR 354; 141 ALR 37 Facts: A woman was seriously injured in a motor vehicle accident caused by the negligence of her husband. She was then cared for by several people, including her husband. She sued her husband in an attempt to get compensation from his liability insurer. The insurer took over the defence of the action, and argued that there should be no Griffiths v Kerkemeyer damages in respect of the value of future care to be provided

by the husband, because to require the defendant (the husband) to pay damages as well as providing care would be to require him to meet the plaintiff’s need for care twice over. Issue: Should the value of the named defendant’s (the husband’s) care reduce the amount payable by the real defendant (the insurer)? Decision: The High Court of Australia rejected the defendant’s argument. Toohey, McHugh, Gummow and Kirby JJ said (at CLR 379–80; ALR 55): The starting point to explain our conclusion is a clear recollection of the principle that the court is not concerned, as such, to quantify a plaintiff’s loss or even to explore the moral or legal obligations to a care provider. It is, as has been repeatedly stated, to provide the injured plaintiff with damages as compensation for his or her need, as established by the evidence. The fact that a defendant fulfils the function of providing [page 684] services does not, as such, decrease in the slightest the plaintiff’s need. Keeping in mind this explanation of the basis for the rationale for the exceptional recovery under Griffiths v Kerkemeyer is essential for working out, in the most consistent and least unsatisfactory way, the practical problems and those of legal principle presented in this case. … When this focus is kept in mind, the anomaly of depriving the plaintiff of recovery, simply because the care is provided by the tortfeasor, is presented in sharp relief. From the plaintiff’s point of view, the identity of the person who fulfils the need caused by the tort matters not. If profoundly injured, the plaintiff may even be unaware of who is fulfilling the need. … To deny the plaintiff recovery in such a case would not only be unjust to the plaintiff, it would provide the very windfall to the defendant (or, more realistically, his or her insurer) which sustained the original provision of damages for gratuitous services in favour of plaintiffs.

12.101 The principle that gratuitous benefits should not be taken into account when calculating damages is not confined to services, as the next case shows. The case shows that the principle also applies when the gratuitous benefit is provided involuntarily by someone who hopes (in vain) to get paid. Case Example Anthanasopoulos v Moseley (2001) 52 NSWLR 262

Facts: Four separate proceedings were brought by plaintiffs whose cars had been damaged by negligence. In each case, the plaintiff sought damages to cover the cost of hiring another car while her or his car was being repaired. In each case, the plaintiff’s insurer had voluntarily provided the plaintiff with the cost of hiring a substitute car for the period of repair, even though it was not required to do so under the insurance contract. Issue: Should the value of the use of the gratuitously provided substitute cars reduce the amount of damages payable by the defendants? Decision: The New South Wales Court of Appeal held that damages for the cost of hiring a substitute car were recoverable, because the gratuitous benefit provided to the plaintiffs by the insurer should be ignored in calculating damages. The court held that this conclusion was dictated by a series of cases involving damage to non-profit-earning ships, beginning with The Greta Holme [1897] AC 596. Beazley JA (with whom Handley JA agreed) said (at [58]): [N]otwithstanding that both parties tended to maintain the focus on the Griffiths v Kerkemeyer principle and the question of its application to cases of property damage, I consider that the better solution is derived from the long line of authority traceable to The Greta Holme, to the effect that injury to property which deprives a party of the use of the thing is compensable. It is irrelevant if a third party provides a substitute for the thing damaged and the principle res inter alios acta [things taking place between [page 685] others, ie, something that does not concern the defendant] applies so as to make it irrelevant as to the basis upon which the third party provides the replacement. Although Ipp AJA agreed with Beazley JA that the answer to the case was provided by The Greta Holme rather than Griffiths v Kerkemeyer, he stressed the similarity between the two lines of authority. Ipp AJA (with whom Handley JA agreed) said (at [80]–[81]): In my opinion, the true basis of claims for damages for injury to a non-income producing chattel is also based on need. In The Greta Holme line of cases, the plaintiffs were held, generally, to be entitled to damages based on the cost (including the capital cost) of keeping and maintaining the damaged vessels while they were being repaired. Underlying the measure of damages so adopted is the owner’s need to keep (or replace) the damaged chattel during the period while it is being repaired and cannot be used. Accordingly, in my view, as claims for damages to a non-income producing chattel and claims of the Griffiths v Kerkemeyer category are both based on need, the latter category of cases provides additional support for the proposition that the [plaintiffs] are entitled to damages against the [defendants].

Case Example Saric v Tehan (2011) 33 VR 632 Facts: The plaintiff’s car was badly damaged in an accident caused by the defendant’s negligence. It was towed to a crash repair workshop, where it was repaired. The repairer did not obtain the plaintiff’s written approval before beginning the repairs, which meant that the repairer was not entitled to recover any payment from the plaintiff, by operation of the Accident Towing Services Act 2007 (Vic) s 153(1). The plaintiff sued the defendant, who argued that the damages to be awarded should not include any sum for the cost of repairing the car, which had been repaired by the repairer at no cost to the plaintiff. Issue: Should the repair cost be set off against the award of damages? Decision: The Victorian Court of Appeal held that the repair cost should not be set off against the award of damages. Mandie JA (with whom Harper JA and Robson AJA agreed) said (at [59]): [T]he [Accident Towing Services] Act was a piece of consumer legislation and … s 153 of the Act was intended to deter repairers and to protect the owners of motor vehicles involved in accidents as defined. It is obvious that the benefit conferred on the owner, where the repairer has no approval in writing to perform the repairs, was conferred on an owner ‘independently of the existence in him of a right of redress against others’. Clearly enough, the legislation manifests no intent that this benefit was intended to be provided in relief of liability in any others to compensate the owner. Indeed, as the [plaintiff] pointed out, the provision is not restricted to collisions involving other vehicles. The problem at hand was assuredly not present to the mind of the drafters but one can impute from the nature of the provision that Parliament would not have intended a tortfeasor to gain from the benefit provided to an owner.

[page 686]

Problem 1 12.102 In practice, the assessment of damages undertaken by lawyers (as opposed to that undertaken by judges) is usually part of the process of negotiating to settle claims out of court. It involves an assessment of the whole of the award of damages that the plaintiff is likely to receive if her or his claim is successful. This problem, involving Paloma, engages in this process. Paloma’s story follows … Two years ago, Paloma was injured in an accident (not involving a motor vehicle or her

workplace) caused by her sister, Dia, with whom she shares a rented house. At the time of the accident, Paloma was 25 years old. Although Paloma had enjoyed working as a gardener, four years ago, prior to the accident, she decided to upgrade her qualifications. She commenced a five-year degree course — a Bachelor of Landscape Planning and Design, combined with a Bachelor of Arts at Daisy Bay University. Even though her grades were borderline, Paloma persisted with her studies. Before the accident, Paloma worked as a gardener during university vacation periods, earning an average of $500 net per week for about 20 weeks each year. She has not worked since the accident. Paloma suffered a number of injuries. These included a fracture of her first cervical vertebra, crush fractures of her third thoracic vertebrae, a comminuted fracture of her left arm and severe lacerations to her left wrist and thigh. She also suffered facial lacerations. Immediately after the accident, she remained in the spinal ward at the local hospital for six weeks. Her upper body was almost entirely encased in plaster. Paloma has been left with permanent disabilities. She has difficulty moving her left arm below the elbow; the movement of her spine is restricted in all directions, so that she can only perform twisting movements with great pain; she has a large spiral scar on her left thigh; and her left knee occasionally gives way. For a long time after the accident, she complained of left-sided pleuritic chest pain. Paloma’s neck and left shoulder become stiff and painful after sustained periods of reading, writing or activity. As a result of her injuries, she has been unable to complete the Landscape Planning and Design course she was enrolled in at the time of the accident. She cannot, for example, undertake drafting exercises, which require great dexterity. She also is unable to do any of the physical work associated with completing her degree. Before the accident, Paloma was a keen amateur sportswoman, with a passion for cycling and skiing. She is now unable to play any sports. She is also unable to enjoy working outdoors in the garden, which had previously brought her great joy (as well as her livelihood). Paloma cannot work in any occupation which involves twisting, turning, squatting, kneeling or carrying anything heavy. She is therefore unable to work as a gardener, a job which required her to be physically fit and strong — to be able to undertake weeding, trimming, mulching, mowing lawns and setting up watering systems. However, she is capable of full-time work, as long as proper consideration is given to the constraints imposed by these movement limitations. Paloma has incurred medical expenses to a total of $60,000, which have, to date, been funded by Medicare. Her doctors expect that Paloma will require and greatly [page 687] benefit from massage therapy, fortnightly for the next five years. Paloma’s sister Dia is a trained massage therapist, and she intends to give Paloma whatever therapy she needs without charge. Paloma also may require some surgery, particularly on her knee. Paloma has sued Dia, who has liability insurance. Dia’s insurer has not yet admitted that Dia is liable for Paloma’s injuries. A pre-trial conference has been arranged between Paloma and Dia’s insurer, in an attempt to settle the action out of court. Having regard

to the central issues that would arise in an assessment of Paloma’s damages (not every issue, such as superannuation, needs to or will be explored here): • advise Paloma on the minimum sum that she should be prepared to accept by way of settlement; • advise Dia’s insurer on what sum (if any) to offer by way of settlement. Assume: • in the Australian Capital Territory, the present lump sum value of $1 per week at 3 per cent for 33 years is $1,099.70; • in Western Australia, the present lump sum value of $1 per week at 6 per cent for 33 years is $764.60; • in New South Wales, Northern Territory, Queensland, South Australia, Tasmania and Victoria, the present lump sum value of $1 per week at 5 per cent for 33 years is $855.70; • the market cost of a massage therapy session is $50; • the accident occurred exactly two years ago; • Paloma planned on retiring at age 65 (regardless of when she is entitled to a pension); • Paloma has a strong case on liability, which you have assessed to have about a 75 per cent prospect of success if the case goes to trial.

Discussion Arguments for Paloma 12.103 The following is a rough calculation of the damages that Paloma may be awarded if her action succeeds. Loss of earning capacity Paloma has not worked for the past two years. Her net earnings as a gardener, for two years before the accident (while she was undertaking her Bachelor of Landscape Planning and Design and Bachelor of Arts degrees) averaged $10,000 per annum. Thus, special damages for loss of earnings would currently be $20,000. General damages for loss of earning capacity would be calculated on the basis of 33 more [page 688] years in the workforce, bearing in mind her planned retirement age, as Paloma is now 27. Paloma can no longer work in the occupation for which she was (and is) qualified, that

of gardener, and her injuries have prevented her from acquiring a new qualification as a landscape planner and designer. Although she has some residual earning capacity, she is confined to non-manual work. She will also have trouble finding skilled work, as she can no longer sit, read or concentrate for long periods of time. On the basis that work of that kind (unskilled, non-manual labour) might earn Paloma about $250 net per week, her residual earning capacity is 50 per cent. At this point, this is based on her work as a gardener rather than on her potential income as a landscape designer and planner. Her loss of earning capacity is 50 per cent. At the time of the accident, Paloma was not fully exercising her capacity to earn as a gardener. In Forsberg v Maslin, general damages for loss of earning capacity were calculated on the basis of the plaintiff’s capacity to earn as a plant operator, without taking into account the fact that he was not exercising that capacity in full at the time of the accident. However, in Mannv Elbourn, it was held that damages for loss of earning capacity should be calculated on the basis of the extent to which the plaintiff was exercising her or his earning capacity at the time of the accident, plus a component to represent the loss of the chance of exercising that earning capacity in full at some time in the future. This method of calculating loss of earning capacity in this context was approved by McHugh J in Medlin v State Government Insurance Commission and the New South Wales Court of Appeal in Norris v Blake (by his Tutor Porter) (No 2). If the Mann approach were to be used, Paloma’s loss would be calculated on the basis of her average weekly earnings of $192.31, which represents the extent to which she was exercising her earning capacity at the time of the accident. (The figure is her total annual earnings of $10,000 divided by 52.) A loss of 50 per cent of that figure would be $96.15 per week. If Paloma’s case were heard in the Australian Capital Territory, the 3 per cent common law discount rate established by the High Court of Australia in Todorovic v Waller would apply. If her case were heard in Western Australia, a discount rate of 6 per cent would apply. The remaining jurisdictions would apply a 5 per cent discount rate, in accordance with their Civil Liability Acts. Using actuarial tables to calculate the respective amounts in each jurisdiction, yields the following figures: • Australian Capital Territory: the present lump sum value of $1 per week at 3 per cent for 33 years is $1,099.70. Therefore, the present value of a loss of $96.15 per week at that rate for that period would be $105,736. • Western Australia: the present lump sum value of $1 per week at 6 per cent for 33 years is $764.60. Therefore, the present value of a loss of $96.15 per week at that rate for that period would be $73,516. • New South Wales, Northern Territory, Queensland, South Australia, Tasmania, Victoria: the present lump sum value of $1 per week at 5 per cent for 33 years is $855.70. Therefore, the present value of a loss of $96.15 per week at that rate for that period would be $82,276. [page 689]

A component should be added to these respective amounts, to represent Paloma’s loss of the chance of exercising her earning capacity in full in the future. Paloma had chosen to earn less than she was qualified to earn because she was studying to be a landscape planner and designer. She has lost the chance to complete that course as a result of her injuries. Therefore, there is no reason to suppose that she would have continued to earn at an average weekly rate of $192.30 for the rest of her working life, because she would either have qualified as a landscape planner or, failing that, would have returned to full-time work as a gardener. For that reason, the figure of $105,736 in the Australian Capital Territory, $73,516 in Western Australia, and $82,276 in the other jurisdictions undervalues Paloma’s loss. If these figures were to be (at least) doubled they would more adequately represent her loss of the chance to earn as a full-time gardener or as a landscape planner and designer (assuming she would have passed and attained fulltime employment as a planner and designer, bearing in mind her borderline grades). These figures should therefore be as follows: • Australian Capital Territory: $211,472; • Western Australia: $147,032; • New South Wales, Northern Territory, Queensland, South Australia, Tasmania, Victoria: $164,552. An award of general damages for loss of earning capacity is generally discounted to take contingencies into account, but in Wynn v New South Wales Ministerial Corporation, it was said that the court should not always assume unfavourable contingencies, particularly where, as here, there was a real prospect that the plaintiff would have enjoyed career advancement if she had not been injured. As explained above, there is no reason to suppose that the vicissitudes of life would have reduced Paloma’s earnings for the rest of her working life to a level below the amount that she had voluntarily chosen to earn in the short term while studying to be a landscape planner and designer. Because Paloma would have earned a full-time wage as a gardener or landscape planner and designer, she should argue that no deduction should be made for contingencies. If Paloma’s case were to be heard in New South Wales and the Northern Territory, the court would have to follow a stipulated statutory approach to contingencies or ‘vicissitudes’ (described by Simpson J in Jones v Dyldam Developments Pty Ltd as ‘somewhat ineffectual’, and posing ‘real problems of construction’; or ‘most obscure’ according to Giles JA and Cripps AJA in Penrith City Council v Parks). But that statutory approach also permits an increase in the award of pecuniary loss to take into account positive contingencies, according to the courts in Macarthur Districts Motor Cycle Sportsmen Inc v Ardizzone and Nominal Defendant v Lane. Considering all the circumstances, the following figures seem appropriate: • Australian Capital Territory: a round figure of $215,000 for general damages for loss of earning capacity; • Western Australia: a round figure of $150,000 for general damages for loss of earning capacity;

[page 690] • New South Wales, Northern Territory, Queensland, South Australia, Tasmania, Victoria: a round figure of $165,000 for general damages for loss of earning capacity. Because of the nature of Paloma’s employment history and prospects, she will not be affected by the statutorily prescribed ceilings imposed by the Civil Liability Acts. Hospital and medical expenses and Van Gervan damages Paloma has incurred hospital and medical expenses to the value of $60,000 since the accident. To date, they have been paid by Medicare. Since 1996, Medicare benefits have been payable even if the patient has received or is entitled to receive an award of damages: see the Health and Other Services (Compensation) Act 1995 (Cth). Paloma would argue that Medicare benefits should be ignored when assessing damages in her case, because the Act provides that the Commonwealth can recover any Medicare payments from a person like Paloma, who has received (or will receive) an award of damages. In Griffiths v Kerkemeyer, the High Court of Australia held that the defendant must pay damages for the value of caring services provided gratuitously to the plaintiff by friends and family. In Van Gervan’s case, the High Court held that the true measure of Griffiths v Kerkemeyer damages is the market cost of the services provided to the plaintiff, and in Kars v Kars the High Court held that if the caring services are to be provided by the defendant damages are still payable if the true defendant is an insurer. Although the services provided by Dia are not the usual kind of services that are the subject of a Griffiths v Kerkemeyer award, in that they are non-medical treatment services rather than home caring services, Paloma will nevertheless argue that the principles stated by the High Court in Griffiths, Van Gervan and Kars should be extended to apply here (or indeed argue that the massage therapy comes within the terms of those cases). There may be some skepticism about the value of this type of (arguably) unusual treatment and therapy and the shortness of its duration, in weekly terms. However, to answer that concern, Paloma would highlight the fact that her doctors stated that they expected that she would require and greatly benefit from these treatments. Then again, Dia’s insurer may argue that this was not a ‘need’ (and again argue that this does not fit within what was intended in Griffiths and Van Gervan). In the Australian Capital Territory, the common law position (above) regarding this type of damages operates without statutorily imposed limitations. Accordingly, the damages to be paid by Dia’s insurer to Paloma, her sister, should include the market cost of 26 massage therapy sessions per year for five years at $50 per session, even though the massage therapy is to be provided gratuitously by Dia herself. The total cost of massage therapy is thus $1,300 per year, or $25 per week. The present value of $25 per week at 3 per cent for five years is $6,062.50 ($242.50 x 25). If one adds to that a component to take into account the chance that Paloma may require further surgery (with respect to her knee), a round figure of $7,500 seems appropriate. Knee surgery could therefore be assessed at about $1,500 in other jurisdictions (if we

assume the cost of knee surgery is slightly less costly in the Australian Capital Territory (simply in order to try to reach relatively round figures)). [page 691] However, in accordance with the Civil Liability Acts in all jurisdictions except the Australian Capital Territory, specific provisions that restrict these damages must be considered as they will affect this part of Paloma’s claim. In these jurisdictions, on balance and for reasons that often differ from one jurisdiction to another, it is very unlikely that Paloma would be able to recover for Dia’s services. Problematic issues for Paloma include the fact that in New South Wales, the Northern Territory, Queensland and Tasmania the care would have to be provided for more than six hours per week (and six months). This is not a hurdle in Victoria (according to Alcoa Portland Aluminium Pty Ltd v Victorian Workcover Authority) because of the five-year duration of the therapy, even though it would be for less than six hours per week. However, an additional significant point must be noted: in Victoria, as well as New South Wales, the Northern Territory, Tasmania and Western Australia, these damages are only to be awarded for ‘gratuitous attendant care services’ (or words to that effect, such as ‘gratuitous services of a domestic nature’, in Western Australia), which confines the award to the kinds of services provided in Griffiths v Kerkemeyer itself. This presumably precludes recovery for massage therapy. Finally, in South Australia, Dia’s and Paloma’s sisterly relationship falls outside the specified family relationships in which the services must be provided to permit recovery. Non-pecuniary losses In Planet Fisheries Pty Ltd v La Rosa, the High Court of Australia stated that there was no tariff for the award of non-pecuniary loss in Australia. Of course, daily practice was at odds with this heavily criticised common law principle. Although the statutory responses under the Civil Liability Acts differ somewhat from jurisdiction to jurisdiction, they all essentially reverse this principle. In the Australian Capital Territory, New South Wales, Tasmania, Victoria and Western Australia, the court is specifically allowed to refer to its own earlier decisions or those of other courts. New South Wales and South Australia require the court to assess where Paloma’s non-pecuniary loss lies on a scale from 1 to 100 and 1 to 60 respectively. Queensland’s Act requires the court to assign a value to Paloma’s injury in accordance with an injury scale. In that state, courts are to take into account the injury scale values (ISVs) given to similar injuries in previous proceedings. Not surprisingly, the high end of these types of scales is reserved for ‘the most extreme cases’ (New South Wales), ‘non-economic loss of the gravest conceivable kind’ (South Australia) and ‘injury of the gravest conceivable kind’ (Queensland). A comparison invariably needs to be made between Paloma’s injuries and continuing disability with those of others under the scale systems: Manning v New South Wales. This is also the case with the approach used in the Australian Capital Territory, Tasmania, Victoria and Western Australia.

In the Northern Territory, common law principles governing the assessment of damages for non-pecuniary loss have been abolished: the amount awarded is based on Paloma’s degree of impairment. An indirect comparison with other cases [page 692] is required, having regard to the kinds of evidence produced for the court by medical practitioners (and ‘prescribed guides’ for evaluating permanent impairment). In New South Wales, Queensland and South Australia, the award is a percentage of each state’s maximum prescribed figure, with the percentage reflecting a single, global assessment of Paloma’s condition. With respect to loss of amenity, Paloma will (and does) feel her loss of amenity keenly, as she was an avid sportswoman, who had a passion for cycling and skiing before the accident: Skelton v Collins. She will also acutely suffer loss of amenity as a result of not being able to enjoy the outdoors and gardening in the same way that was possible before the accident. A sum should also be awarded for the scarring suffered by Paloma, resulting, in particular, from the lacerations to her face. According to Manning v New South Wales, under the New South Wales statutorily imposed scale-based approach, when assessing loss of amenity, greater consideration is to be given to the objective seriousness of injuries than is the case at common law. However, the major determinant remains the subjective effect of the injuries on Paloma. Presumably, this also is the case in South Australia. Factually, in Paloma’s case, this approach should not have an effect on her claim, when compared to how an assessment would be made in other jurisdictions (except Queensland and the Northern Territory). Queensland’s Act is more clearly pegged to an objective approach with respect to loss of amenity, because Paloma’s condition is assessed against an injury scale rather than one concerned with the gravity of the non-pecuniary loss, as in New South Wales and South Australia. If her claim were litigated in the Northern Territory, which uses an impairment table, subjective feelings do not seem to be relevant. Paloma also has undergone a considerable amount of pain and suffering as a result of her injuries. She has a stiff spine, a partially disabled left arm and left leg (with the harm caused to her knee) and chest pain. These enduring disabilities will be assumed (for the sake of argument) to meet the impairment table requirements relevant in the Northern Territory. Pain and suffering is assessed subjectively: Skelton v Collins. In New South Wales and South Australia, this would be taken into account in determining where Paloma’s nonpecuniary loss lies on their respective statutory scales. In Queensland, because the scale only applies to Paloma’s injury rather than her loss, her subjective experience of pain and suffering would not play a part in the assessment of her ISV. Paloma should be alerted to the fact that Dia’s insurer may well argue that because of this, less should be awarded in Queensland: perhaps $10,000 less. However, curiously, Civil Liability Regulation 2003 (Qld) reg 9 provides that in assessing an ISV a court may have regard to Paloma’s pain and suffering.

These subjective experiences of pain and suffering also do not seem relevant in the Northern Territory, according to its impairment table. On the basis of comparable awards recorded in updating services, used as guidance, a global award of $75,000 for non-pecuniary losses seems appropriate [page 693] in all jurisdictions except the Northern Territory and Queensland. This figure will be used in Paloma’s calculations for most jurisdictions, bearing in mind the (relative) arbitrariness of making this type of assessment, including where to place a loss on a particular scale. In the Northern Territory, the figure may be an amount in the vicinity of $40,000, and in Queensland $65,000. It should be noted (or assumed for our purposes) that Paloma’s circumstances are serious enough that the non-economic loss thresholds that have to be met under the Civil Liability Acts are satisfied. (No such thresholds exist under the statutes in the Australian Capital Territory and Queensland). Further, the legislated ceilings (which exist in all jurisdictions except the Australian Capital Territory, Tasmania and Western Australia) will not affect Paloma’s claim, as any award she would receive does not come close to reaching those levels (when compared to other cases’ more serious circumstances, the awards in those cases, and the placement of her loss (or ‘injury’ in Queensland) on the ‘scales’). Total Paloma will argue that the total award of damages that she can expect to recover if her action succeeds is roughly: • Australian Capital Territory: $377,500.50 → Overall, approximately $380,000. —

$80,000 for special damages ($20,000 for loss of earnings, $60,000 for hospital and medical expenses).

—

$222,500.50 for general damages for pecuniary loss ($215,000 for loss of earning capacity, $6,062.50 for Van Gervan damages and $1,438 for hospital and medical expenses for knee operation) (the latter amount could be $1,500 as in other jurisdictions).

—

$75,000 for non-pecuniary losses.

• New South Wales, South Australia, Tasmania, Victoria: $321,500 → Overall, approximately $325,000. —

$80,000 for special damages ($20,000 for loss of earnings, $60,000 for hospital and medical expenses).

—

$166,500 for general damages for pecuniary loss ($165,000 for loss of earning capacity, $0 for Van Gervan damages and $1500 hospital and medical expenses for knee operation).

—

$75,000 for non-pecuniary losses.

• Northern Territory: $286,500 → Overall, approximately $290,000.

—

$80,000 for special damages ($20,000 for loss of earnings, $60,000 for hospital and medical expenses).

—

$166,500 for general damages for pecuniary loss ($165,000 for loss of earning capacity, $0 for Van Gervan damages and $1,500 hospital and medical expenses for knee operation).

—

$40,000 for impairment.

• Queensland: $311,500 → Overall, approximately $315,000. —

$80,000 for special damages ($20,000 for loss of earnings, $60,000 for hospital and medical expenses). [page 694]

—

$166,500 for general damages for pecuniary loss ($165,000 for loss of earning capacity, $0 for Van Gervan damages and $1,500 hospital and medical expenses for knee operation).

—

$65,000 for non-pecuniary losses. (This could be a larger amount if consideration is given to Paloma’s subjective experience, under the regulation, to which a court may have regard.)

• Western Australia: $306,500 → Overall, approximately $310,000. —

$80,000 for special damages ($20,000 for loss of earnings, $60,000 for hospital and medical expenses).

—

$151,500 for general damages for pecuniary loss ($150,000 for loss of earning capacity, $0 for Van Gervan damages and $1,500 hospital and medical expenses for knee operation).

—

$75,000 for non-pecuniary losses.

Overall Paloma has a strong chance of succeeding at trial. That chance has been assessed at about 75 per cent. If the assessment of damages were an exact science, one could say that Paloma should not settle for less than: • Australian Capital Territory: $285,000 → 75 per cent of the $380,000 she would be likely to receive if successful at trial. • New South Wales, South Australia, Tasmania, Victoria: $243,750 → 75 per cent of the $325,000 she would be likely to receive if successful at trial. • Northern Territory: $217,500 → 75 per cent of the $290,000 she would be likely to receive if successful at trial. • Queensland: $236,250 → 75 per cent of the $315,000 she would be likely to receive if successful at trial. • Western Australia: $232,500 → 75 per cent of the $310,000 she would be likely to receive if successful at trial.

However, a number of assumptions have been made in coming up with the figures and 75 per cent chance, so it would be unwise to stick too rigidly to the ‘bottom line’ figures. Given the uncertainties involved in litigation, Paloma would be well advised to accept anything above two-thirds of the figure she expects to get if successful, while continuing to press for more: • Australian Capital Territory: $250,800 → 66 per cent of $380,000. • New South Wales, South Australia, Tasmania, Victoria: $214,500 → 66 per cent of $325,000. • Northern Territory: $191,400 → 66 per cent of $290,000. • Queensland: $207,900 → 66 per cent of $315,000. • Western Australia: $204,600 → 66 per cent of $310,000. Arguments for Dia 12.104 The rough calculation made by Dia’s insurer would be very similar to Paloma’s. However, counsel for Dia’s insurer might make different estimates of the inexact figures. These differences follow. [page 695] For example, if an estimate of 60 per cent rather than 50 per cent were used with respect to Paloma’s residual earning capacity, this would produce a loss of $76.92 per week. This amounts to: • Australian Capital Territory: $84,589 at 3 per cent over 33 years. • Western Australia: $58,813 at 6 per cent over 33 years. • New South Wales, Northern Territory, Queensland, South Australia, Tasmania, Victoria: $65,820 at 5 per cent over 33 years. Dia’s insurer’s counsel will certainly argue that Paloma’s future earnings capacity loss must not be overvalued. Therefore, her insurer’s counsel may propose a relatively small component to represent Paloma’s loss of the chance to use her earning capacity as a landscape planner or designer in the future, especially considering the evidence of Paloma’s poor grades in her course. • Australian Capital Territory: a component of $42,295 for loss of the chance to earn, which represents 50 per cent of the loss of earning capacity, should be used. This yields a subtotal of $126,884 for loss of earning capacity. • Western Australia: a component of $29,407 for loss of the chance to earn, which represents 50 per cent of the loss of earning capacity, should be used. This yields a subtotal of $88,220 for loss of earning capacity. • New South Wales, Northern Territory, Queensland, South Australia, Tasmania, Victoria: a component of $32,910 for loss of the chance to earn, which represents 50 per cent of the loss of earning capacity, should be used. This yields a subtotal of $98,730 for loss of earning capacity.

Dia’s insurer’s counsel also will no doubt argue that there should be a deduction on account of contingencies. A deduction of 5 per cent on this basis would yield the following figures: • Australian Capital Territory: $126,884 – $6,344 = $120,540. • Western Australia: $88,220 – $4,411 = $83,809. • New South Wales, Northern Territory, Queensland, South Australia, Tasmania, Victoria: $98,730 – $4,936.50 = $93,793.50. Although Griffiths, Van Gervan and Kars make it fairly clear that the method of calculating Paloma’s hospital and medical expenses is broadly correct, Dia’s insurer’s counsel may argue that there should be no payment for hospital and medical expenses, past or future, as those expenses have been and will be covered by Medicare (that is, that Medicare benefits should be counted as a collateral benefit to be set off against the award of damages). Further, in the Australian Capital Territory, Dia’s insurer’s counsel should argue that the massage therapy provided fortnightly by Dia to Paloma is not the kind of care envisaged by Griffiths and Van Gervan as recoverable as damages. Finally, the insurer would argue that a conservative estimate of Paloma’s non-pecuniary losses should be used. The figure should be $25,000 less than what Paloma argued: • Northern Territory: $40,000 – $25,000 = $15,000 (Note, though, that because Paloma was assessed on the basis of her impairment in the Northern Territory, [page 696] with no regard given to subjective loss, the insurer may not now be able to convincingly argue for this $25,000 reduction.) • Queensland: $65,000 – $25,000 = $40,000 (Note that because Paloma was assessed on the basis of the injury scale in Queensland, with less regard given to her subjective loss, the insurer may not now be able to convincingly argue for this $25,000 reduction. However, if a larger amount taking into account her subjective experience were used, based on the regulation, then a reduction could be argued more convincingly.) • Australian Capital Territory, New South Wales, South Australia, Tasmania, Victoria, Western Australia: $75,000 – $25,000 = $50,000. These differences in the estimates would produce an estimated global award of: • Australian Capital Territory: $190,540 → Overall, approximately $192,000. $20,000 special damages, for loss of earnings only. $120,540 general damages for pecuniary loss (loss of earning capacity only). $50,000 for non-pecuniary losses. • New South Wales, South Australia, Tasmania, Victoria: $163,794 → Overall, approximately $165,000.

$20,000 special damages, for loss of earnings only. $93,794 general damages for pecuniary loss (loss of earning capacity only). $50,000 for non-pecuniary losses. • Northern Territory: $128,794 → Overall, approximately $130,000. $20,000 special damages, for loss of earnings only. $93,794 general damages for pecuniary loss (loss of earning capacity only). $15,000 for non-pecuniary losses. • Queensland: $153,794 → Overall, approximately $155,000. $20,000 special damages, for loss of earnings only. $93,794 general damages for pecuniary loss (loss of earning capacity only). $40,000 for non-pecuniary losses. • Western Australia: $153,809 → Overall, approximately $155,000. $20,000 special damages, for loss of earnings only. $83,809 general damages for pecuniary loss (loss of earning capacity only). $50,000 for non-pecuniary losses. Overall advice Paloma’s chance of succeeding at trial is about 75 per cent. This suggests an offer should be made in the region of the following, based on 75 per cent of the overall assessment (in each jurisdiction): • Australian Capital Territory: $142,905 (75 per cent of $190,540) → $143,000. • New South Wales, South Australia, Tasmania, Victoria: $122,846 (75 per cent of $163,794) → $123,000. • Northern Territory: $96,596 (75 per cent of $128,794) → $97,000. • Queensland: $115,346 (75 per cent of $153,794) → $116,000. • Western Australia: $115,357 (75 per cent of $153,809) → $116,000. [page 697] Because of the many uncertainties of litigation and of the process of calculating these figures, it may be wise (at least initially) to regard each figure, noted above, as a maximum. Therefore, Dia’s insurer may wish to begin negotiations by offering an amount that is, perhaps, about $25,000 lower than that noted here. Note It may be advisable for Dia’s insurer’s counsel to concede the Medicare point, thus producing a sum closer to that proposed by the plaintiff. It is likely that the greatest difficulties in assessment, as is often the case, will focus on Paloma’s loss of earning capacity and the chance she would have earned a higher income — especially as a landscape planner and designer. Finally, there is room for negotiation (and argument) with respect to the suggested (rather arbitrary) amounts for non-pecuniary loss (or impairment in the Northern Territory).

Problem 2 12.105 Recall Pria, who featured in Chapter 3. Please consider the following additional information about Pria for the purposes of making an assessment of damages. Prior to her detention at Daisy Bay Youth Detention Centre, Pria had attended Aspirationville Grammar School. She had a history of being bored at school, as a result of which she ‘acted out’ — behaving disruptively. At age 10, Pria was finally diagnosed with Attention Deficit Disorder. Di, Pria’s 25-year-old sister and only close relative, could barely look after Pria, let alone ensure Pria took her medication for her disorder. Pria, however, was highly intelligent. In particular, she was, by all accounts, an artistic genius. Unfortunately, because of her disorder and her school’s inability to control her, Pria channeled her energies in ways that brought her into contact with the criminal justice system. As she entered her teenage years, Pria became one of her community’s most well-known and popular graffiti artists. Her trademark consisted of politically cutting commentary as part of her street canvasses. She was also well known for her brilliant footpath paintings on High Street and along the riverfront, near the museum. Indeed, her fame spread well beyond Daisy Bay, Aspirationville and Serenity Springs and Domain City. On occasion, Pria was commissioned to reproduce her High Street artwork as framed paintings (on canvasses), for sale to wealthy clients. These benefactors took great pride in purchasing art from someone they proclaimed was a genuine ‘up-and-coming talent’ despite the fact they actually (and inwardly) believed Pria’s political views were rather crass and vulgar. Although Pria felt rather compromised catering to the whims of the wealthy, she nevertheless enjoyed cashing the handsome cheques presented to her for her work. Indeed, Pria’s ‘The Winking Mona Lisa’, a crowd favourite, yielded her $10,000. Pria increasingly came into contact with a sub-culture where drug use was prevalent. She was sentenced to six months detention at Daisy Bay Youth Detention Centre for property- and drug-related offences. [page 698] As a result of the incident at the detention centre involving the bee sting, peanut allergy and Narcan, Pria remains (and will remain) severely disabled due to partial brain damage. Although communication is very difficult, she can make her needs known and is still considered a highly intelligent person. She has, however, lost mobility on her right side and can no longer draw or paint. Pria needs constant care. Di, a police officer, has stated that she’s willing to look after Pria — at least for a while. Assuming Pria succeeded in establishing liability in the tort of negligence, advise Pria with respect to the damages assessment arguments that may be raised.

Further discussion 1. Whose approach do you prefer, and why: that of the majority in Cattanach v Melchior or that of the dissenting judges, whose views have been endorsed by statute in New South Wales, Queensland and South Australia? 2. Do you agree with the result in G and M v Armellin (2008) 219 FLR 359, in which a couple who had undergone IVF treatment were able to successfully sue their obstetrician for the cost of raising one of their twins, as they had not planned on becoming pregnant with more than one child? Should this complaint be treated as an ‘ordinary’ example of medical negligence, like any other? Not surprisingly, there was a media frenzy concerning this case, in which the couple’s sexuality received undue and unwarranted attention, as it was irrelevant. 3. Do you agree with the High Court of Australia’s reasoning in Harriton v Stephens (Kirby J dissenting) that applying the compensatory principle in these circumstances was ‘impossible’? 4. Unmarried women may be better off financially under the principles applied in Hines v Commonwealth than under those stated in Sharman v Evans, because they may be able to recover damages for ‘loss of opportunity to marry’ as well as damages for loss of earning capacity. Despite the practical positive effects for some unmarried women, do you think it appropriate to value a woman’s injuries by reference to (among other things) the amount earned by the man she might have married? 5. What is the justification for discounting awards for future pecuniary losses? Do you agree with it? Why did most jurisdictions legislate to raise the discount rate from 3 per cent, when it had been fixed at that percentage by the High Court of Australia for several decades?

6.

How should a court calculate the value of loss of earning capacity of a child who has not yet begun to earn? Is the child’s intelligence relevant to this issue? What about the child’s parents’ jobs or the career paths of the child’s brothers and sisters or the kind of school the child attended? Should calculations be based on national average earnings? See H Luntz, Assessment of Damages for Personal [page 699] Injury and Death, 4th ed, LexisNexis Butterworths, Sydney, 2002, pp 323–5 and, for example, Burford v Allan at 62,295–6.

7. Was the abolition of Planet Fisheries Pty Ltd v Rosa desirable and appropriate? 8. Are the legislative limits imposed on damages awards for nonpecuniary losses (by virtue of thresholds, ceilings and scales) desirable and appropriate? 9. Do you agree with the suggestion that damages should not be awarded for non-pecuniary losses, because they are dehumanising and contribute to a culture in which all suffering becomes a commodity? See R Abel, ‘A Critique of American Tort Law’ (1981) British Journal of Law and Society 199 at 210. 10. Discuss the following critique of damages assessment: ‘Tort law proclaims the class structure of capitalist society: you are what you own, what you earn, and what you do’: R Abel, ‘A Critique of American Tort Law’ (1981) 8 British Journal of Law and Society 199 at 207. If this is an accurate reflection of how damages assessment operates, should it be reformed? If so, how? In this context, is it desirable to place ceilings on the maximum amount a plaintiff can recover for loss of earning capacity? Does this type of legislative change address some of Abel’s concerns? 11. To fully understand the devastation a serious injury can have on someone’s life, it is worth reading Murphy J’s dissenting judgment

in Sharman v Evans, in which he describes in vivid detail all aspects of Ms Evans’ horrific injuries and the care she will need. In his view (at CLR 599; ALR 87), the trial judge’s award was too low, and the High Court’s reduction ‘will, even more than the original award, destine Miss Evans to be a charity case’. He continued, ‘the judicial practice of depressing damages, especially in catastrophic personal injury cases … conceals the social costs of negligent driving, unsafe vehicles and unsafe roads and transfers much of the burden to injured persons’. Do you agree with this sentiment? 12. Having considered how damages are assessed, does this affect your view of no-fault compensation schemes (noted in Chapter 1)? 13. Assume you are Paloma’s lawyer. Paloma responds to Dia’s insurer’s first offer by saying, ‘It’d take me years to earn that much; sounds pretty good to me!’. You advise Paloma that you believe it is inadequate, and she should go to court. Paloma heeds your advice. Her action fails. Can Paloma do anything about having missed out on the offer and receiving nothing?

Further reading Balkin R P and Davis J L R, ‘Compensation in Personal Injury Actions’ in Law of Torts, 5th ed, LexisNexis Butterworths, Sydney, 2013, Ch 11. Barker K, Cane P, Lunney M and Trindade F, ‘Damages’ in The Law of Torts in Australia, 5th ed, Oxford University Press, South Melbourne, 2012, Ch 16. [page 700] Fordham M, ‘A Life Less Ordinary: The Rejection of Actions for Wrongful Life’ (2007) 15 Torts Law Journal 123. Golder B, ‘From McFarlane to Melchior and Beyond: Love, Sex, Money

and Commodification in the Anglo-Australian Law of Torts’ (2004) 12 Torts Law Journal 128. Graycar R and Morgan J, The Hidden Gender of Law, 2nd ed, Federation Press, Sydney, 2002. Jhaveri S, ‘Judicial Strategies in Recognising New Areas for Recovery in Negligence – Lessons Learned from Wrongful Conception Cases’ (2013) 21 Tort Law Review 63. Luntz H, Assessment of Damages for Personal Injury and Death, 4th ed, LexisNexis Butterworths, Sydney, 2002. Luntz H, Hambly D, Burns K, Dietrich J, Foster N, Grant G and Harder S, ‘Damages’ in Torts: Cases and Commentary, 8th ed, LexisNexis Butterworths, Sydney, 2017, Ch 8. Teff H, ‘Condoning Wrongful Suffering’ (2007) 15 Tort Law Review 7.

1 2 3

4

5 6

7 8 9

Civil Liability Act 2002 (NSW) ss 70, 71; Civil Liability Act 2003 (Qld) ss 49A, 49B (failed sterilisation procedures only); Civil Liability Act 1936 (SA) s 67. Civil Liability Act 2002 (NSW) s 71(2); Civil Liability Act 1936 (SA) s 67(2). Civil Liability Act 2002 (NSW) ss 22–26 and Motor Accidents Compensation Act 1999 (NSW) s 143; Personal Injuries (Civil Claims) Act 2003 (NT) s 12 and Personal Injuries (Liabilities and Damages) Act 2003 (NT) ss 31–32; Civil Liability Act 2003 (Qld) ss 63– 67; Supreme Court Act 1935 (SA) s 30BA; Civil Liability Act 2002 (Tas) s 8; Wrongs Act 1958 (Vic) ss 28M–28N; Civil Liability Act 2002 (WA) ss 14–15. The Australian Capital Territory had similar legislation until 2006, but it was repealed by the Justice and Community Safety Legislation Amendment Act 2006 (ACT) s 2.62. Civil Liability Act 2002 (NSW) s 22; Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 31(a); Civil Liability Act 2003 (Qld) s 63; Supreme Court Act 1935 (SA) s 30BA; Civil Liability Act 2002 (Tas) s 8(2); Wrongs Act 1958 (Vic) s 28M; Civil Liability Act 2002 (WA) s 14. Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 31(b). Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 32; Supreme Court Act 1935 (SA) s 30BA; Civil Liability Act 2002 (Tas) s 8(1); Wrongs Act 1958 (Vic) s 28N; Civil Liability Act 2002 (WA) s 15. Civil Liability Act 2002 (NSW) s 23(1), (2); Civil Liability Act 2003 (Qld) s 64. Civil Liability Act 2002 (NSW) s 26; Civil Liability Act 2003 (Qld) s 67. Civil Liability Act 2002 (NSW) s 18(1)(b) (except in cases of dust-related injuries); Civil Liability Act 2003 (Qld) s 60(1)(b); Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 29(b).

10

11 12 13 14 15 16 17 18 19 20 21 22 23 24

25 26 27 28 29 30 31

32 33

34 35

36

Civil Liability Act 2002 (NSW) s 15(2); Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 23(1); Civil Liability Act 2003 (Qld) s 59(1)(a), (b), (2); Wrongs Act 1958 (Vic) s 28IA(1). Civil Liability Act 2003 (Qld) s 59(2). Civil Liability Act 2002 (NSW) s 15(4), (5); Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 23(3), (4); Wrongs Act 1958 (Vic) s 28IB. Civil Liability Act 2002 (NSW) s 15(3). Civil Liability Act 2003 (Qld) s 59(1)(c). Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 23(2). Civil Liability Act 1936 (SA) s 58(1)(a); Civil Liability Act 2002 (WA) s 12(1). Civil Liability Act 1936 (SA) s 58(2), (3); Civil Liability Act 2002 (WA) s 12(5)–(7). Civil Liability Act 2002 (WA) ss 12(3), (4), 13. Civil Liability Act 2002 (WA) s 12(2). Civil Liability Act 2002 (Tas) s 28B(2), (3). See the now-repealed Common Law (Miscellaneous Actions) Act 1986 (Tas) s 5. Civil Liability Act 2002 (Tas) s 28C; Transport Accident Act 1986 (Vic) s 93(10)(c). Motor Accidents (Compensation) Act (NT) ss 18A, 18B. Civil Liability Act 2002 (NSW) s 15(1); Personal Injuries (Liabilities and Damages) Act 2003 (NT) s 18 (definition of ‘gratuitous services’, the term used in s 23); Civil Liability Act 2002 (Tas) s 3 (definition of ‘gratuitous services’, the term used in s 28B); Wrongs Act 1958 (Vic) s 28B (definition of ‘gratuitous attendant care services’); Civil Liability Act 2002 (WA) s 12(1) (‘gratuitous services of a domestic nature’). Civil Liability Act 2003 (Qld) s 59(1); Civil Liability Act 1936 (SA) s 58(1). Civil Law (Wrongs) Act 2002 (ACT) s 100. Civil Liability Act 2002 (NSW) s 15B. Civil Liability Act 2003 (Qld) ss 59A–59D. Civil Liability Act 2002 (Tas) s 28BA. Wrongs Act 1958 (Vic) s 28ID(1). Section 28IE deals with how such damages are to be calculated. Civil Law (Wrongs) Act 2002 (ACT) s 98(1), (2); Civil Liability Act 2002 (NSW) s 12(2), (3); Personal Injuries (Liabilities and Damages) Act 2003 (NT) ss 18 (definition of ‘average weekly earnings’), 20; Civil Liability Act 2003 (Qld) s 54(1), (2); Dictionary (definition of ‘average weekly earnings’); Civil Liability Act 2002 (Tas) s 26; Wrongs Act 1958 (Vic) s 28F(2), (3); Civil Liability Act 2002 (WA) s 11(1), (3). Australian Bureau of Statistics, 6302.0 — Average Weekly Earnings, Australia, Nov 2016, (accessed 12 July 2017). The right to damages in products liability cases is conferred by the Competition and Consumer Act 2010 (Cth), Sch 2 (Australian Consumer Law) s 236. Rather confusingly, the limit on recoverable damages does not appear in the Australian Consumer Law itself, but in the Competition and Consumer Act 2010 (Cth) ss 87U, 87V. Civil Liability Act 1936 (SA) ss 3(1) (definition of ‘prescribed maximum’), 54(2). The Australian Bureau of Statistics website has a CPI value calculator at: