LAW OF TORTS WEEKEND LECTURE 2A Lecturer: Greg Young Contact: greg.young@lawyer.com NEGLIGENCE Duty of care & Breach

LAW OF TORTS WEEKEND LECTURE 2A Lecturer: Greg YoungContact: greg.young@lawyer.com NEGLIGENCE Duty of care & Breach: Civil Liability Act Damage PURE ECONOMIC LOSS VICARIOUS/CONCURRENT LIABILITY

Part 1A Duty of Care – more commentary • Section 5B(1) provides a person is not negligent unless… (b) the risk was not insignificant. • Wyong Shire Council v Shirt (1980) 146 CLR 40: risk must be “real” in the sense that a reasonable person would not “brush it aside as far-fetched or fanciful.” • Is “not insignificant” in Section 5B(1)(b) more restrictive than “not far-fetched or fanciful” in Wyong Shire Council v Shirt ?

Part 1A Duty of Care – more commentary • Recreational Activities – Sections 5J to N - The NSW Govt could not exclude the operation of the Trade Practices Act 1974, although the Federal Govt has done so by passing The Trade Practices Amendment (Liability for Recreational Services) Act 2002 proclaimed on 19/12/02

Part 1A Duty of Care – more commentary • Recreational Activities – Sections 5J to N • Issues of concern: Is the commercial incentive for the safe provision of recreational & commercial activities gone? What real bargaining power do consumers have in negotiating a contractual waiver? Definition of recreational activity is broad and ambiguous.

Part 2 Personal Injury Damages • Received assent on 18 June 2002 • Section 11A: (1) does not apply to claims excluded by Section 3B (eg. Damages for dust diseases, use of tobacco products, worker’s compensation…) (2) Part 2 applies regardless of whether the claim is brought in tort, contract, statute or otherwise (3) A court cannot award damages, or interest on damages, contrary to Part 2.

Part 2 Personal Injury Damages • Economic Loss: • Maximum for gross loss loss of earnings = 3 times average weekly earnings: Section 12 • 5% discount rate for future economic loss: Section 14 • Gratuitous Attendant Care: • No damages awarded if the services are provided: (a) for less than 6 hours per week, and (b) for less than 6 months: Section 15(3) Geaghan v D’Aubert [2002] NSWCA 260

Part 2 Personal Injury Damages • Non-economic loss (general damages): • No damages for non-economic loss unless assessed at 15% of a most extreme case (eg. 15% = 1% or $3,500, 16% = 1.5% or $5,250, …26% = 8% or $28,000, …33% = $115,500…100% = $350,000): Section 16(1) & (3) • Maximum non-economic loss = $350,000: Section 16(2) • Maximum for non-economic loss indexed: Section 17 • Courts/parties may refer to other awards of non-economic loss in earlier court decisions: Section 17A

Part 2 Personal Injury Damages • Pre-judgment Interest: • No interest payable on damages for non-economic loss or gratuitous attendant care: Section 18(1) • If interest is awarded (eg. Past economic loss), the “relevant interest rate” is the Commonwealth Govt 10-year benchmark bond rate: Section 18(4)

Part 2 Personal Injury Damages • 3rd Party Contributions: • Where the award against the 3rd Party is not subject to Part 2 (eg. Dust disease, tobacco use, workers’ compensation…): Section 19 Step 1 Assess percentage of liability between the defendant and 3rd party (eg. 50/50) Step 2 Assess damages against the defendant’s under Part 2 (say, $200,000), then apply percentage of liability to that assessment (50% of $200,000 = $100,000) Step 3 Assess the non-Part 2 damages against the 3rd party (say, $100,000), then apply percentage of liability to that assessment (eg. 50% of $100,000 = $50,000)

Part 2 Personal Injury Damages Exemplary, punitive & aggravated damages: • A court cannot award exemplary, punitive or aggravated damages: Section 21 Structured settlements: • Agreement that provides for the payment of all or part of an award of damages in the form of periodic payments: Section 22

Part 5 Liability of Public & Other Authorities • Proclaimed on 6/12/02: Sections 40 to 46 • Provides specific additional protection for public authorities including: • the Crown • Government departments • Local councils • Other prescribed bodies

Part 5 Liability of Public & Other Authorities • Section 42sets out the principles to apply in determining whether a public or other authority has a duty of care or has breached a duty of care including: • the functions required to be exercised by the authority are limited by the financial and other resources that are reasonably available to the authority for the purpose of exercising those functions, • the general allocation of those resources by the authority is not open to challenge, • the functions required to be exercised by the authority are to be determined by reference to the broad range of its activities (and not merely by reference to the matter to which the proceedings relate), • 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 proceedings relate.

Part 5 Liability of Public & Other Authorities • Section 43: an act or omission by an authority does not constitute a breach of a statutory duty, unless the act or omission so was unreasonable in the circumstances that no authority having the functions in question could properly consider the act or omission to be a reasonable exercise of it function.

Part 5 Liability of Public & Other Authorities • Section 44: Removes the liability of public authorities for failure to exercise a regulatory function if the authority could not have been compelled to exercise the function under proceedings instituted by the Plaintiff. • Section 45: Restores the non-feasance protection for highway authorities taken away by the High Court in Brodie v Singleton Shire Council Council; Ghantous v Hawkesbury City Council (2001) 206 CLR 512

Part 6 Intoxication • Proclaimed on 6/12/02: Sections 47 to 50 • Section 48: Broadly defines as any person under the influence of alcohol or drugs, whether or not taken for medicinal purposes and whether or not lawfully taken. • Section 49: a court is not to consider intoxication as giving rise to any higher standard of care on the part of the Defendant.

Part 6 Intoxication • Section 50: a court is not to award damages for harm where the Plaintiff’s capacity to exercise reasonable care and skill for their own safety was impaired as a consequence of intoxication and unless the Court is satisfied that the same harm would have occurred even if the person had not been intoxicated : Where an intoxicated Plaintiff overcomes the hurdle of demonstrating that their intoxication did not contribute to their harm, there is a presumption of at least 25% contributory negligence unless the court is satisfied otherwise.

Part 6 Intoxication Issues: • Definition of intoxication extends to prescription drugs. Is a hospital exempt from taking special care for a patient when it knows that the side effects of the prescribed drug are drowsiness or aggression? • Why should hoteliers not have a special duty of care to patrons? • Why has judicial discretion been removed to assess contributory negligence?

Part 7 Self-Defence & Recovery by Criminals • Proclaimed on 6/12/02: Sections 51 to 54 • Section 52(1) & (2): No civil liability for acts in self-defence of self, another or property,provided the act of defence is a reasonable response (objective) to the circumstances as perceived (subjective). • Section 52(3): This section does not apply if the person uses force that involves the intentional or reckless infliction of death only to protect property, to prevent criminal trespass or to remove a person committing criminal trespass.

Part 7 Self-Defence & Recovery by Criminals 53 Damages limitations apply even if self-defence not reasonable response • If section 52 would operate to prevent a person incurring a liability to which this Part applies in respect of any conduct but for the fact that the conduct was not a reasonable response in the circumstances as he or she perceived them, a court is nevertheless not to award damages against the person in respect of the conduct unless the court is satisfied that: (a) the circumstances of the case are exceptional, and (b) in the circumstances of the case, a failure to award damages would be harsh and unjust.

Part 7 Self-Defence in Recovery by Criminals • Section 54: A court is not to award damages in respect of liability where at the time of death, injury or damage the Plaintiff was engaged in conduct that (on the balance of probabilities) constitutes a serious offence. - A "serious offence" is an offence punishable by imprisonment for 6 months or more. - This section operates whether or not the offence has been prosecuted and proved. - The criminal conduct must have contributed materially to the risk of death, injury or damage.

Parts 8 & 9 Good Samaritans & Volunteers • Proclaimed on 6/12/02: Sections 55 to 66 • Parts 8 & 9 operate to protect Good Samaritans and volunteers. • Section 58: no protection if the Good Samaritan is under the influence of alcohol, impersonating a police officer or falsely representing that they have skills or expertise in providing emergency assistance.

Parts 8 & 9 Good Samaritans & Volunteers • Section 60: Defines community work to mean work that is not for private financial gain and that is done for a charitable, benevolent, philanthropic, sporting, educational or cultural purpose. It excludes community service orders imposed by a court. • Section 61: No civil liability for a volunteer doing community work but does not extend to criminal acts, acts whilst intoxicated, a volunteer failing to exercise reasonable care and skill, actions outside the scope of the charitable organisation or contrary to instructions, where the volunteer is required by State law to be insured or motor vehicle accidents.

Part 10 Apologies • Proclaimed on 6/12/02: Sections 67 to 69 • Section 68: Defined as an expression of sympathy or regret, or of a general sense of benevolence or compassion, in connection with any matter whether or not the apology admits or implies an admission of fault in connection with the matter.

Part 10 Apologies • Section 69(1): An apology … (a) does not constitute an express or implied admission of fault or liability by the person in connection with that matter, and (b) is not relevant to the determination of fault or liability in connection with that matter.

Breach of Duty – General Principles • Wyong Shire Council v Shirt (1980) 146 CLR 40 per Mason J: “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… If the answer is in the affirmative, it is then for the tribunal of fact to determine what a reasonable man would do… The perception of the reasonable man’s response calls for a consideration of the magnitude of the risk and the degree of the 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.”

Breach of Duty – Civil Liability Act • Civil Liability Act does not apply to claims excluded by Section 3B (eg. dust diseases, use of tobacco products, worker’s compensation…) • Section 5B(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.

Breach of Duty – Likelihood of Injury • Section 5B(2)(a) the probability that the harm would occur if care were not taken • Bolton v Stone [1951] AC 850

Breach of Duty – Seriousness of Risk • Section 5B(2)(b) the likely seriousness of the harm • Adelaide Chemical & Fertilizer Co. v Carlyle (1940) 64 CLR 514 • Paris v Stepney Borough Council [1951] AC 367

Breach of Duty – Cost of Avoiding Harm • Section 5B(2)(c) the burden of taking precautions to avoid the risk of harm • Caledonian Collieries Ltd v Speirs (1957) 97 CLR 202

Breach of Duty – Utility of the Act of the Defendant • Section 5B(2)(d) the social utility of the activity that creates the risk of harm. • South Australian Ambulance Transport Inc. v Walhdeim (1948) 77 CLR 215

Proof of Negligence - General • CIVIL LIABILITY ACT 2002 - SECT 5E: Onus of proof • In determining liability for negligence, the plaintiff always bears the onus of proving, on the balance of probabilities, any fact relevant to the issue of causation. Holloway v McFeeters (1956) 94 CLR 470

Proof of Negligence – Res Ipsa Loquitor • “The action/thing speaks for itself” • Nominal Defendant v Haslbauer (1967) 117 CLR 448

Damage in Negligence Duty of care Negligence Breach Damage

Damage in Negligence • Damage is the gistof the action in Negligence • The scope of actionable damage: • property • personal • mental • pure economic loss • Damage must be actual for compensation; no cause of action accrues until damage • Limitations period therefore begin from the time of the injurious consequences of a conduct not from when the conduct first occurred

Damage in Negligence • For P to be successful in an action in Negligence, D’s breach of duty must cause damage to P or his/her property

CAUSATION 1 Duty of Care breach damage = Negligence causation There must be a causal link between D’s breach of duty and damage to P or P’s property

CAUSATION 2: THE ELEMENTS • Causation involves two fundamental questions: • the factual question whether D’s act in fact caused P’s damage: causation-in-fact • Whether, and to what extent D should be held responsible for the consequences of his conduct: legal causation

Causation – Civil Liability Act • Section5D 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").

CAUSATION-IN-FACT • Causation in fact relates to the factor(s) or conditions which were causally relevant in producing the consequences • Whether a particular condition is sufficient to be causally relevant depends on whether it was a necessary condition for the occurrence of the damage • The necessary condition: causa sine qua non

CAUSATION • To be successful in a claim for a remedy, P needs to prove that the loss for which he/she seeks compensation was caused in fact by the D’s wrongful act • Traditionally, the test whether D’s wrongful act did in fact cause the loss is the ‘but for’ test

THE ‘BUT FOR’ TEST • But for the D’s conduct, the injury to P would not have happened: • Waller v James (Wrongful life – IVF case with failure to test or advise about the dangers of the father’s AT3 deficiency)

THE FUNCTION OF THE ‘BUT FOR’ TEST • Two functions: • The primary (negative) function is to assist in eliminating factors which made no difference to the outcome • The second (positive) function: it helps to identify a condition or a factor which may itself then be subject to a test of legal causation

THE ‘BUT FOR’ TEST IN THE HIGH COURT • Fitzgerald v Penn ( 1954) 91 CLR 268 • ‘Causation is all ultimately a matter of common sense….[It] is not susceptible of reduction to a satisfactory formula’(per Dixon, Fullagar and Kitto JJ) • March v E& MH Stramare (1991) 171 CLR 506*The but for test gives rise to a well known difficulty in cases where there are two or more acts or events which would each be sufficient to bring about the plaintiffs injury. The application of the tests gives the results, contrary to common sense, that neither is a cause. The application of the tests proves to be either inadequate or troublesome in various situations in which there aremultiple acts or events leading to the plaintiff's injury(per Mason J)

THE ‘BUT FOR’ TEST: IMPLICATIONS OF A COMMON SENSE APPROACH • Bennett v Minister of Community Welfare (1992) 176 408 • ‘if the but for ‘ test is applied in a practical common sense way, it enables the tribunal of fact, consciously or unconsciously, to give effect to value judgments concerning responsibility for the damage. If ..the test is applied in that way, it gives the tribunal an unfettered discretion to ignore a condition or relation which was in fact a precondition of the occurrence of the damages’

THE ‘BUT FOR’ TEST IS NOT EXHAUSTIVE • Bennett: ‘ causation is essentially a question of fact to be resolved as a matter of common sense. In resolving that question, the ‘but for’ test , applied as a negative criterion of causation, has an important role to play but it is not a comprehensive and exhaustive test of causation; value judgments and policy considerations necessarily intrude (per Mason CJ , Deane and Toohey JJ)

MULTIPLE CAUSES • Where the injury or damage of which the plaintiff complains is caused by D’s act combined with some other act or event, D is liable for the whole of the loss where it is indivisible; where it is divisible, D is liable for the proportion that is attributable to him/her

MULTIPLE CAUSES: TYPES • Concurrent sufficient causes • where two or more independent events cause the damage/loss to D ( eg, two separate fires destroy P’s property) • Successive sufficient causes • Baker v Willoughby; • Faulkner v Keffalinos (1971) 45 ALJR 80; • Jobling v Associated Dairies Ltd [1982](dormant spondylotic myelopathy activated); • Malec v Hutton [1990] 169 CLR( possible future spinal condition) • D2 is entitled to take P (the victim) as he finds him/her • Where D2 exacerbates a pre-existing loss/injury (such as hasten the death of P) D2 is liable only for the part of the damage that is attributable to him

THE ELEMENTS OF CAUSATION Causation Legal Factual (Causation in fact)

LAW OF TORTS WEEKEND LECTURE 2A Lecturer: Greg Young Contact: greg.young@lawyer.com NEGLIGENCE Duty of care & Breach