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Introduction:

The liability provisions of the Civil Liability Act 2002 NSW commenced on 6 December 2002, by the Civil Liability Amendment (Personal Responsibility) Act 2002. The provisions extend to civil liability arising before 6 December 2002, but only to proceedings commenced in a Court on and after 6 December 2002.

Intentional Torts:

S.3B concerning the Act not applying to intentional torts was inserted by the Personal Responsibility Act. For the purposes of this presentation the relevant provisions are as follows:

    3B(1) The provisions of this Act do not apply to or in respect of civil liability (and awards of damages in those proceedings) as follows:

        (a) civil liability in respect of an intentional act that is done with intent to cause injury or death or that is sexual assault or other sexual misconduct - the whole Act except:

             (i) s.15B and s.18(1)…

             (ii) Part 7 (self defence and recovery by criminals) in respect of civil liability in respect
             of an intentional act that is done with intent to cause injury or death.

S.15B concerns damages for loss of capacity to provide domestic services, inserted in 2006 following the High Court decision in CSR Ltd v Eddy on 21 October 2005. S.18(1) concerns the restriction on awarding interest. Part 7 concerns persons acting in self-defence, and persons injured when committing a serious criminal offence.

State of NSW v Ibbett [2005] NSWCA 445:

This was a decision of the Court of Appeal on 13 December 2005 following a District Court decision of Phegan DCJ.

There was a Police chase of a suspected traffic offender at about 2.00 am. The suspect drove into the garage of his mother Mrs Ibbett and closed the garage door. One of the two Police officers chasing him dived under the closing door, drew his revolver and pointed it at the man to arrest him. Mrs Ibbett heard the commotion and entered the garage through a side door. She told the Police officer to leave. The officer's response was to point his gun at Mrs Ibbett and demand that the garage door be opened to allow his fellow officer in. He then turned the gun back on the son. When the second officer came in they arrested the son and conducted a strip search in the vicinity of Mrs Ibbett.

Mrs Ibbett sued the State and was successful in her action for trespass and assault. The trial judge awarded $15,000 in General damages for the assault and $10,000 in exemplary damages for the assault. In relation to the trespass the trial judge awarded $20,000 in aggravated and $20,000 in exemplary damages.

There were three questions for the Court of Appeal to decide:

1. Were the proceedings with respect to an intentional act done with intent to cause injury within s.3B(1)(a)?
2. Were the proceedings an action where the act that caused the injury was negligence within s.21? S.21 states that a Court cannot award exemplary, punitive or aggravated damages where the act or omission was negligence.
3. Are the proceedings an action for the award of personal injury damages within s.21?

The Court had no difficulty finding that s.3B(1)(a) applied. The constable who pointed his gun at the plaintiff said "Open the bloody door and let my mate in". This was done with the expressed objective of coercing her into a particular course of action. The Court accepted the trial judge's findings of an immediate apprehension of harm on the part of the plaintiff intentionally caused by the constable which therefore amounted to an assault. By screaming very loudly at the 69 years old plaintiff this was designed to cause fear and apprehension. Indeed the Police officer was in ordinary street clothing. The Court agreed with the finding of an intention to cause the relevant injury i.e. an apprehension of physical violence.

Thus s.3B(1)(a) applied and the trial judge was correct in assessing damages at Common Law.

Given this finding it did not appear necessary for the Court to consider s.21 which states:

     21. In an action for the award of personal injury damages where the act or omission that caused the injury or death was negligence, a Court cannot award exemplary or punitive damages or damages in the nature of aggravated damages.

The Court found that the act which caused the injury was not negligence; it was assault. In relation to the third question the Court confirmed that personal injury included mental harm.

The officer was guilty of trespass as well as assault, in diving under the garage door indifferent to whether or not he had lawful authority for remaining on the land. The Court of Appeal increased the award of exemplary damages for the assault to $25,000 from $10,000. They had no doubt that the offending officer had acted in contumelious disregard for the safety of the plaintiff.

Bujdoso v State of New South Wales [2006] NSWSC 896:

This was a decision of Justice Sully of the Supreme Court on 5 September 2006. The plaintiff was an inmate at Silverwater Prison when he was bashed with iron bars by assailants wearing balaclavas. Proceedings commenced in the District Court on 15 September 1994 against the State, in negligence in failing to take reasonable steps to protect the plaintiff from the foreseeable risk that he would be the victim of an intentional act of violence. Judgment was given in the District Court (Cooper J) for the defendant on 2 December 2003. The judgment was overturned by the Court of Appeal on 10 September 2004, declaring that the State had breached its duty of care to the plaintiff. The matter was remitted to the District Court for damages only. The State appealed to the High Court. The High Court on 8 December 2005 dismissed the Appeal. The matter was remitted to the District Court where McLoughlin J on 21 July 2006 ordered damages in favour of the plaintiff at $175,100. Thus it took twelve years for the plaintiff to be awarded his damages.

Justice Sully's decision concerned a Summons filed on 14 August 2006 by the plaintiff seeking a declaration that the special provisions for offenders in custody in Division 6 of Part 2A of the Act did not apply. That division provides that damages awarded to an offender are to be held in trust to comprise a Victim Trust Fund for victims of the offender. Justice McLoughlin had awarded damages pursuant to the Common Law and there was no appeal by the State that the Act applied to the various heads of damage.

Justice Sully held that s.3B did apply because the proposition that the defendant could withhold monies from the plaintiff by virtue of the Act was a separate proposition from the assessment of damages relating to the proceedings issued as long ago as 15 September 1994. Thus it was an action to which the Act applied. The case is of interest because of Justice Sully's determination of the meaning of the words "in respect of". The State argued that the focus of the Act was on the defendant's civil liability. The defendant's civil liability arose from negligence for breach of duty of care. It did not arise from an intentional act on its part; "its" referring to the State. His Honour gave short shrift to that argument. He examined the case law noting the wide meaning given to the words "in respect of". The State's liability in negligence was "in respect of" the intentional acts of the assailants. If Parliament wanted the civil liability to be excluded to relate to an intentional act of the defendant sued, then it could have said so.

His Honour also looked at the concept of personal responsibility which was behind the introduction of s.3B in December 2002. He said that the plaintiff had no personal responsibility for the unprovoked attack on him. He was entirely blameless and thus entitled to normal Common Law damages.

The State has appealed. I am informed that the appeal is listed for hearing in the NSW Court of Appeal on 2 March 2007

The Effect:

My view is that Justice Sully is entirely correct in his interpretation of the meaning of s.3B(1)(a). The words "in respect of" have been given a wide meaning in many cases, particularly those concerning the interpretation of insurance policies. But the decision does mean that there will be a potentially wide class of actions where the provisions of the Act concerning liability and damages will not apply.

The first example is assault cases concerning hotels and clubs. There have been many cases over the years, concerning liability of hotel or club proprietors where an assault is committed on a patron, either by another patron or a security officer. Where there is a brawl, it is easy to find that the act causing injury was intentional and was done with intent to cause injury. The liability of the hotel or club is alleged to be in its failure to properly supervise its premises, or provide adequate security, or in the case of security officers assaulting patrons, to supervise the security officers. The action against the hotel or club is in negligence. It is however "in respect of" an intentional act, done by a third party, similar to the assailants in Bujdoso. In those cases we can expect the damages to be awarded at Common Law and the liability to be determined on the Common Law. This is subject to the limited application of the Act concerning Interest restrictions.

It is also important to remember that the Act will not apply to civil liability in respect of an intentional act that is sexual assault or other sexual misconduct. Thus the sexual molestation case where the victim sues an institution for a failure to properly screen or supervise the perpetrator, will also be a case where liability and damages are assessed at Common Law. The institution's liability in negligence for breach of duty of care will be in respect of intentional acts by a perpetrator that constitute sexual assault or other sexual misconduct.

Thus where there is a fight or sexual assault, always consider s.3B(1)(a).

Section 5B - Duty of Care:

The question is whether the cases so far have indicated that there will be a significant change when considering duty of care on the principles outlined in the Act as compared with the Common Law.

S.5B(1) states as follows:

    5B(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 the 2002 Law of Negligence Review undertaken by the Panel chaired by his Honour Mr Justice Ipp, the Committee proposed to modify the formula laid down in Wyong Shire Council v Shirt (1980) 146 CLR 40 by replacing the phrase "not far-fetched or fanciful" with a phrase indicating a risk that carries a higher degree of probability of harm. The Panel favoured the phrase "not insignificant". The Panel stated in paragraph 7.15:

The phrase "not insignificant" is intended to indicate a risk that is of a higher probability than is indicated by the phrase "not far-fetched or fanciful", but not so high as might be indicated by a phrase such as "a substantial risk". The choice of a double negative is deliberate. We do not intend the phrase to be a synonym for "significant". "Significant" is apt to indicate a higher degree of probability than we intend.

Of the cases I have examined none have actually referred to this paragraph on page 105 of the report. The Shirt authority is that a person could not be held liable for failure to take precautions against a risk that could be described as far-fetched or fanciful, even if it was foreseeable. As you know there are many Appellate authorities where the Appeal Courts recognise that almost everything is foreseeable. The essential issue has been whether the precautions taken against that risk, or indeed the lack of precautions, are reasonable in the circumstances.

In my opinion the case law so far does not show a great change in the Common Law in dealing with this issue.

Eutick v City of Canada Bay Council [2006] NSWCA 30:

NSW Court of Appeal decision 3 March 2006.

On 30 May 2001 the 45 years old plaintiff tripped on a lip of a depression, 18 mm high, on a pedestrian crossing parallel to the kerb, when crossing the road and keeping a lookout for traffic. She was not looking at the road surface at the time. She had used the crossing on Great North Road Five Dock eighty times during the few months preceding the accident. The District Court trial judge Judge Twigg found that the ridge was obvious, the plaintiff familiar with the roadway and road works, and there was no breach of duty by the defendant.

Justice Campbell in the Court of Appeal reviewed the Common Law from Shirt to Vairy v Wyong Shire Council [2005] HCA 62 and Mulligan v Coffs Harbour City Council [2005] HCA 63. He confirmed that such a small depression was within a difference frequently considered to be obvious on road or outside surfaces. He considered that a reasonable pedestrian in the position of the plaintiff would be expected to have regard both for oncoming vehicles and the surface of the road. His decision, with which the other two appeal judges Giles and Ipp agreed, was that there was no breach of duty in not repairing the lip.

At the conclusion of the judgment there was less than half a page which dealt with s.5B. The Court held that the onus of establishing that the depression or lip was a "not insignificant risk" was on the plaintiff. Justice Campbell then simply said that she had not discharged the onus. There was no consideration as to whether s.5B created a greater onus on the plaintiff than the Common Law. Indeed the consideration of s.5B appears little more than an afterthought.

Haris v Bulldogs Rugby League Club [2006] NSWCA 53:

The Court of Appeal's decision was delivered on 17 March 2006.

The Canterbury Bankstown Bulldogs Rugby League Club was playing an NRL fixture at its then home ground, the Sydney Showground at Homebush Bay, on 6 September 2002. The Club contracted security officers from an independent contractor WorkForce International. It provided 80-90 staff. Furthermore there were 37 Police officers inside the stadium. As the patrons entered the ground there were inspection tables. Bag searches were conducted. There was a terraced area at the ground known as "Bulldog Hill". The plaintiff and his friends were in that area. The game started at 7.30 pm. At 7.00 pm someone in the crowd on Bulldog Hill set off a flare. Another flare was set off at 8.18 pm. At 8.32 pm a firework was set off. At 9.10 pm, ten minutes before the game ended, the plaintiff also on Bulldog Hill was struck in the left eye by a firework, causing loss of sight in that eye.

The evidence of the security co-ordinator was that the practice of setting off flares would be that fans would get into a close group, someone would ignite the flare and drop it to the ground. Then the group dispersed. This made it difficult to pinpoint the actual perpetrator. The security practice was that after one flare or firework was set off, security staff would "hang off to see if they'll do it again". Following the 8.32 pm incident the security officers identified a group of six from which the possible offender came.

Before the beginning of the game the then Chief Executive Officer of the Bulldogs Steve Mortimer addressed the crowd with a plea to keep everything under control and enjoy the game. The findings of fact by the trial judge Truss DCJ were that extra security officers would not have probably caused the perpetrator to be identified. The Club closed the Hill to further patrons at 7.43 pm. The Club did not have the power to stop the game. That was in the control of the NRL and the Referee. Her Honour found for the defendant, saying that the steps taken by the Club were reasonable and that there was no evidence that further steps would have prevented the offence which caused the injuries.

In this case sections 5B(2) and 5C were considered. They state:

    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.

5C Other Principles

In proceedings relating to liability for negligence:

           (a) the burden of taking precautions to avoid a risk of harm includes the burden of taking precautions to avoid similar risks of harm for which the person may be responsible, and

           (b) 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, and

           (c) 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 Court considered the social utility of persons attending football matches. It noted the evidence accepted by the trial judge that statistics suggested that attending football matches serves a useful social purpose for a considerable number of people. Thus she dealt with s.5B(2)(d).

It was the plaintiff's submission that more extensive bag searches would have revealed the owner of the fireworks. The Security Officer's evidence as to bag searching was that it would continue up until the end of the game, with respect to persons entering the ground. The evidence was that there were no exceptions. Every person with a bag was asked to open the bag and the bag was searched. Evidence of a witness called for the plaintiff that bag searching was not carried out was not accepted. The security officers did not conduct body searches, e.g. patting people down or putting their hands in people's pockets or demanding that they empty their pockets. It was accepted that the security officers did have power to conduct individual body searches. However it was found by the trial judge and accepted by the Court of Appeal that it would be totally impractical to carry out an individual body search of each person as he or she entered the ground. There was no evidence that certain individuals had an appearance or exhibited behaviour that raised suspicion. Again in this case the Shirt line of authority was considered. The trial judge was criticised for not dealing with s.5B specifically. However the Court of Appeal accepted that she dealt with precisely the issues raised by s.5B. Specifically with respect to s.5B(2)(c) it was accepted by the trial judge and Court of Appeal that it would be completely impractical to body search all entrants to the ground. The evidence of the Chief Inspector of Police was that this would be physically impossible.

Thus it was accepted that the precautions taken were reasonable and that the further precautions raised by the plaintiff in submissions, in particular body searches, was completely impractical. The Court held that the trial judge did deal satisfactorily with the issues raised in 5B(2) concerning reasonable precautions to the relevant risk. The lead judgment was by Justice Santow with which the President Justice Mason and Justice Ipp agreed.

In dealing with the provision of s.5B in this case the Court of Appeal looked at precisely the same principles as it would if it was dealing with the Common Law. Indeed it was the recommendation of the Ipp Panel that apart from the slight modification to the Shirt formula (not insignificant risk) that it would be helpful to trial judges to set out the issues to consider when considering the reasonable precautions to take against a risk. The Panel stated in paragraph 7.17 (page 106):

We also think that it would be helpful to embody the negligence calculus in a statutory provision. This might encourage judges to address their minds more directly to the issue of whether it would be reasonable to require precautions to be taken against a particular risk.

The Panel's recommendations are embodied in s.5B(2).

In other words it was never intended that apart from the use of the words "not insignificant" that the principles of duty of care outlined in the Act would be different to the Common Law.

Obvious Risk:

At Common Law the High Court has clarified that the obviousness of a risk does not mean that there is no duty of care. The question is whether a risk being obvious justifies nothing being done to prevent or warn against that risk; Mulligan, Vairy, Neindorf v Junkovic [2005] HCA 75.

In Mulligan the plaintiff's dive in an estuary from thigh level was seen to be such an obvious risk that it was not necessary to erect a warning sign, the risk being well-known and likely. Variable depth in tidal estuaries was a common danger.

In Vairy the plaintiff dived from a rock platform at a beach where the sandy bottom was only at a depth of 1.5 metres. There had been a similar accident fifteen years beforehand and there was no warning sign. This was a narrow decision 4:3 in favour of the Council where the majority considered the obviousness of the risk of diving into water of an unknown depth was such that a sign was not required. The three judges in the minority considered that the misleading attractiveness of the pursuit, exemplified by many people doing it, did not obviate the necessity to erect a sign, particularly as an accident had occurred fifteen years beforehand.

C G Maloney Pty Ltd v Hutton-Potts & Anor [2006] NSWCA 136:

Decision of the New South Wales Court of Appeal 29 May 2006.

The plaintiff entered the defendant's Bondi Hotel. She walked through the bar area on timber flooring. Near the entrance to the poker machine room she slipped and fell on a filmy residue of spray which was not visible to the naked eye and had been left by the cleaner following polishing the floor. The trial judge (Graham DCJ) did not refer to the Civil Liability Act at all. The Court of Appeal examined the provisions of ss.5F, 5G and 5H relating to obvious risk. Ultimately the result was the same as at trial. The Court of Appeal stated that whether the Common Law was applied or the provisions of the Act, the result would not change. S.5F states:

5F MEANING OF "OBVIOUS RISK"

1. For the purposes of this Division, an obvious risk to a person who suffers harm is a risk that, in the circumstances, would have been obvious to a reasonable person in the position of that person.
2. Obvious risks include risks that are patent or a matter of common knowledge.
3. A risk of something occurring can be an obvious risk even though it has a low probability of occurring.
4. A risk can be an obvious risk even if the risk (or a condition or circumstance that gives rise to the risk) is not prominent, conspicuous or physically observable.

The defendant argued that the risk should have been obvious because the cleaner was still performing his duties when the plaintiff walked through the area. The cleaner's evidence was that a warning sign was placed. The plaintiff's evidence was that the cleaner obscured the warning sign so that she did not see it. The trial judge and the majority in the Court of Appeal held that the risk was not obvious because the precise risk which had been created, the residue of polish on the floor, was not visible to the naked eye. S.5F(4) states that a risk can be obvious even if it is not physically observable. But the majority did not accept that the mere fact that the cleaner was still polishing the floor was enough to make it obvious that he had not removed residue polish from the area where the plaintiff walked. It was not obvious that the cleaner would not have done his job properly. While the residue was not physically observable, that specific risk was not obvious; Bryson and McColl JJA.

Thus it was not necessary for the majority to consider ss.5G and 5H, concerning the presumption of awareness and there being no duty to warn of the obvious risk. Santow JA in the minority concerning obvious risk, appeared to accept that the risk may have been obvious i.e. cleaners leaving spilt polish. However he said that nothing flowed from this. His view was that the breach of duty did not concern the alleged obvious risk. It concerned the defendant allowing access into the hotel when a cleaning process was underway, without roping off the area which was being cleaned to keep members of the public away from that area. Justice Santow did however make some comments on s.5G and s.5H, which state as follows:

5G INJURED PERSONS PRESUMED TO BE AWARE OF OBVIOUS RISKS

1. In determining liability for negligence, a person who suffers harm is presumed to have been aware of the risk of harm if it was an obvious risk, unless the person proves on the balance of probabilities that he or she was not aware of the risk.
2. For the purposes of this section, a person is aware of a risk if the person is aware of the type or kind of risk, even if the person is not aware of the precise nature, extent or manner of occurrence of the risk.

5H NO PROACTIVE DUTY TO WARN OF OBVIOUS RISK

1. 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.
2. This section does not apply if:
   • the plaintiff has requested advice or information about the risk from the defendant, or
   • the defendant is required by a written law to warn the plaintiff of the risk, or
   • the defendant is a professional and the risk is a risk of the death of or personal injury to the plaintiff from the provision of a professional service by the defendant.
3. Subsection (2) does not give rise to a presumption of a duty to warn of a risk in the circumstances referred to in that subsection.

The first point made by Justice Santow was that the presumption of being aware of an obvious risk is rebuttable. It is still open to the plaintiff to prove on the balance of probabilities that he or she was not aware of the risk. That is specifically stated in s.5G(1).

With respect to s.5H Justice Santow stated that the provision had the same effect as the Common Law, where obvious risk may obviate the need to warn. This is an interesting observation given that s.5H specifically states the duty to warn is not owed, whereas the High Court clarified that obvious risk did not mean that there was no duty of care.

In defending such cases we should be aware of the plaintiff's pleading breaches of duty other than those concerning risks which appear obvious.

S.5H(2) provides for exceptions to there being no duty to warn of obvious risk. S.5H(2)(b) states that the section does not apply where the defendant is required by a written law to warn the plaintiff of the risk. The Common Law is written. The written precedents up to 2005 confirm that there remains a duty of care, even where the risk is obvious. Thus perhaps on a proper construction of s.5H(2)(b) the section is meaningless. However the Common Law does clarify that in certain circumstances there is no requirement to warn of an obvious risk.

However the next case indicates that there may be some difference in the Common Law when compared with Division 4 of the Act (ss.5F, 5G, 5H).

Great Lakes Shire Council v Dederer & Anor, Roads & Traffic Authority of NSW v Dederer [2006] NSWCA 101:

NSW Court of Appeal decision 5 October 2006.

On 31 December 1998 the 14 years old plaintiff dived off the Foster/Tuncurry bridge into a tidal estuary. The water was nine metres below the point where the plaintiff dived. He dived into approximately two metres of water and struck his head on a sand bar. His injuries caused paraplegia.

If ever there was a case where a risk was obvious this would be the one. There were pictograph signs at the approaches to the bridge prohibiting diving and climbing on the bridge. The plaintiff had read and understood the signs, but ignored them. The bridge was used extremely often by adults and children as a jumping and diving platform. The RTA designed and constructed the bridge in 1959. The Council had control over the bridge given that it formed part of a public road. By 1990 the RTA was aware of people frequently jumping off the bridge. In that year it conferred with Police in an attempt to prevent this. The response of both defendants was to replace the existing pictorial signs with no diving pictographs in 1995. These had virtually no effect. The bridge had a horizontal railing from which the people would dive or jump. One issue for the trial judge and majority in the Court of Appeal was whether the installation of pool-type fencing may have deterred the practice.

The plaintiff sued the RTA before the commencement of the Act. After the commencement of the Act the plaintiff joined the Council to the proceedings. Thus the Act applied with respect to the Council but not the RTA. Nevertheless the Supreme Court trial judge Dunford J found against both. The RTA was 80% responsible and the Council 20%, with contributory negligence at 25%. Dunford J did not accept the activity as an obvious risk within s.5F. The plaintiff had seen many people jumping and diving off the bridge. He had observed vessels passing through the channel. These factors indicated to him that the water was deep. Having regard to his lack of maturity and young age the danger was not obvious.

All three judges in the Court of Appeal disagreed. With respect to the liability of the Council the risk of serious spinal injury flowing from the act of diving off the bridge should have been obvious to a reasonable fourteen and a half year old child, with knowledge of the area and conditions. The risk that materialised was an obvious risk of a dangerous recreational activity in which he was engaged and thus s.5L, as discussed below, also applied.

However the result was different against the RTA. In applying the Common Law, as discussed above, the RTA could not say that it had no duty of care because of the obviousness of the risk. The obvious risk was not a deterrent to the activity. The railing was easy to jump off. The high frequency of the activity, combined with the railings configured in such a way that it made it easy to jump or dive off, created an allurement to a young person such as the plaintiff. The fact that there were no prior injuries did not assist the RTA. That made it less likely that people would refrain from the activity. Thus it was not reasonable to do nothing. The majority in the Court of Appeal (Ipp and Tobias JA) considered that the handrail should have been modified or replaced by vertical railings such as pool-type fencing. In applying the Shirt test the majority ruled that the RTA has failed in its duty as the builder of the bridge to not modify the handrail and to not replace the existing sign with a sign warning of the shifting sands and variable depth. In dissent Justice Handley did not accept that the RTA had such a responsibility to guard against an accident in 1998, having built the bridge in 1959. He considered at Common Law that the risk was so obvious that there was no breach of duty in not taking the further preventative measures considered by the majority.

The result of this case indicates that in certain cases there may be a difference when the same facts are considered with a view to Common Law liability and liability under the Act. The Common Law has confirmed that obvious risk does not mean that there is no duty of care. The issue is whether the preventative action or lack of preventative action is reasonable. In Dederer the type of activity being a dangerous recreational activity meant that when s.5F, 5G and 5H were combined with s.5L, that the Council was not liable. However the RTA was liable at Common Law. I am informed that the RTA has appealed. The Special Leave Application is listed for 2 March 2007.

It is in my view too early to say whether or not the provisions concerning obvious risk will lead to the same result as if the Common Law was applied. Clearly in the case of Dederer there was a different result in the application of the Act and the Common Law to the same facts. However the High Court's decision may change this.

Dangerous Recreational Activities:

The case law so far involves Oztag (a form of touch Rugby), spotlight shooting, dolphin watching, and bridge diving, (as discussed above).

Falvo v Australian Oztag Sports Association & Anor [2006] NSWCA 17:

Court of Appeal decision 2 March 2006.

On 18 January 2000 the plaintiff was playing Oztag on Millers Reserve in the Warringah Council area. Oztag is a form of touch Rugby where players have tags attached by Velcro to the sides of their shorts. A player in possession of the ball must release it as soon as the opposition has ripped off the tag. Millers Reserve was a grass area which had a number of areas where through wear and tear the grass had disappeared. The Council had topped up these areas with sand. The condition of the field was obvious to all. As the plaintiff was running with the ball he moved from a grassed area to a patch devoid of grass. As he encountered the bare patch, his foot went into the sand and his knee gave way. The plaintiff failed before the trial judge Hungerford DCJ on the basis that the field was consistent with acceptable standards. His Honour also found that Oztag was a dangerous recreational activity within Division 5 of the Act. The relevant sections are as follows:

DIVISION 5 - RECREATIONAL ACTIVITIES

5J APPLICATION OF DIVISION

1. This Division applies only in respect of liability in negligence for harm to a person (the plaintiff) resulting from a recreational activity engaged in by the plaintiff.
2. This division does not limit the operation of Division 4 in respect of a recreational activity.

5K DEFINITIONS

In this Division:

dangerous recreational activity means a recreational activity that involves a significant risk of physical harm.

obvious risk has the same meaning as it has in Division 4.

recreational activity includes:

• any sport (whether or not the sport is an organised activity), and
• any pursuit or activity engaged in for enjoyment, relaxation or leisure, and
• any pursuit or activity engaged in at a place (such as a beach, park or other public open space) where people ordinarily engage in sport or in any pursuit or activity for enjoyment, relaxation or leisure.

5L NO LIABILITY FOR HARM SUFFERED FROM OBVIOUS RISK OF DANGEROUS RECREATIONAL ACTIVITIES

1. A person (the defendant) is not liable in negligence for harm suffered by another person (the plaintiff) as a result of the materialisation of an obvious risk of a dangerous recreational activity engaged in by the plaintiff.
2. This section applies whether or not the plaintiff was aware of the risk.

Expert evidence from a turf grass consultant at trial was that the playing surface was satisfactory for amateur sport, being a multi-use city council field.

Ipp JA gave the lead judgment with which Hunt AJA and Adams J agreed. Firstly his Honour considered the Common Law, noting that slightly differing levels and sandy patches on sports grounds are part of the practical realities of everyday life; Neindorf v Junkovic [2005] HCA 75 considered. Neindorf was a case concerning a garage sale where an uneven concrete slab was held to be so ordinary and visible that no action was required.

The Appeal in Falvo was dismissed but his Honour disagreed with the trial judge's finding on "dangerous recreational activity". His Honour referred to Premier Bob Carr's second reading speech of the Personal Responsibility Bill on 23 October 2002; that there would not "be any liability for the obvious risks of particularly dangerous sports and other risky activities". Justice Ipp did not consider that the definition of dangerous recreational activity: "that involves a significant risk of physical harm" could apply to a recreational activity where:

where there is no more than a significant risk of an insignificant injury".

He was referring to a sprained ankle or a minor scratch to the leg. He stated that Oztag, like touch rugby, is not what is normally understood as a contact sport. It is designed to reduce the extent of physical contact, including that in ordinary touch rugby. "Dangerous recreational activity" could not mean activities which involve athleticism with no tackling and no risk of being struck by a hard ball. While I believe that this decision is common sense, his Honour did make some comments which should assist us with regard to other sporting activities. He stated:

…the 'risk of physical harm' may be 'significant' if the risk is low but the potential harm is catastrophic. The 'risk of physical harm' may also be 'significant' if the likelihood of both the occurrence and the harm is more than trivial. On the other hand, the 'risk of physical harm' may not be 'significant' if, despite the potentially catastrophic nature of the harm the risk is very slight.

It would follow from Justice Ipp's reasoning that rugby league or rugby union would qualify as a dangerous recreational activity. The risk of catastrophic neck injury may be low, but would probably be significant.

Falvo is a case where at Common Law the plaintiff failed. But the defendant could not rely on Division 5 concerning dangerous recreational activity.

Fallas v Mourlas [2006] NSWCA 32:

Court of Appeal decision 16 March 2006.

The plaintiff Mr Mourlas and the defendant Mr Fallas were involved in spotlight shooting of kangaroos. Fallas was driving the vehicle while Mourlas sat in the front passenger seat. Mourlas held the spotlight and shone it out of the window while other men shot at kangaroos. Two men got out of the vehicle to walk in front while the vehicle followed them. Fallas climbed out of the vehicle with a hand gun to join the other men and then returned to the vehicle still holding the hand gun. Mourlas asked him not to come into the vehicle with a loaded gun. Fallas gave repeated assurances that the gun was not loaded. Mourlas once again asked him not to bring the gun inside and to point it outside. Fallas began "clocking the gun back and forward" to un-jam it. In doing this he pointed the gun in Mourlas' direction. The gun went off and Mourlas was shot. The trial judge Quirk DCJ found negligence by Fallas. She did not accept that the activity at the time of the accident (when Mourlas was shot) was "dangerous recreational activity" within s.5K.

The three appeal judges were Ipp, Tobias and Basten JJA. Ipp and Tobias accepted that spotlight shooting was a "dangerous recreational activity" within s.5K. Ipp J stated that it is necessary to determine the activity and actual circumstances giving rise to the harm, which could require segmenting the particular activities the plaintiff was engaged in. The holding of the spotlight could be segmented from the activity of shooting the kangaroos. In the circumstances there was a significant risk that one of the men could enter the vehicle with a loaded gun and shoot someone else in the vehicle. The plaintiff's activity did carry a significant risk of physical harm and did qualify as a "dangerous recreational activity".

But it was next necessary to consider s.5L; was the gunshot an obvious risk of the dangerous recreational activity. The two judges had already found that it was a significant risk. Ipp JA said that the risk was not obvious. The plaintiff made earnest requests for Fallas to be careful. The eventual shooting was gross negligence by Fallas. But this did not constitute an obvious risk as defined by s.5F.

Basten JA found that the accidental discharge of the gun was an obvious risk whatever the knowledge and belief of the two men. Basten JA had decided that the risk in getting into the car with a loaded gun was separate to the recreational activity of spotlighting. Thus although the risk was obvious it was not of a recreational activity.

If Tobias JA had been in the majority the plaintiff would have lost. He believed that fiddling with the gun created the obvious risk. He considered the activity dangerous recreational activity.

The decision is convoluted because while Justices Ipp and Basten disagreed, ultimately they formed the majority to defeat the Appeal. Ipp stated that the gross negligence was not obvious. Basten stated that the risk was obvious, but once the two men were inside the car, they were not engaging in the recreational activity.

The case is thus unsatisfactory. At best it shows that the Court will separate activities being conducted, indeed by different persons within one group, to determine whether the actual activity at the time of the accident (point of impact) was a dangerous recreational activity.

Lormine Pty Ltd & Anor v Xuereb [2006] NSWCA 200:

Court of Appeal judgment delivered 25 July 2006.

The plaintiff was a passenger on a dolphin watch cruise on a ten metre powered catamaran offshore just north of Forster on 29 November 2000. The captain allowed passengers to sit on the bow so long as children were accompanied by an adult. The plaintiff was a 36 years old lady in a group of approximately twenty adults and children. The plaintiff took up the invitation and sat on the starboard side looking out to the sea as the vessel moved north.

The captain kept the vessel in the wave zone, as close as 35 metres from the beach. The cruise also catered for more adventurous passengers who wished to get in the water and swim with the dolphins. The captain was assisting passengers on the aft deck who were preparing to swim. He was the only employee of the defendant on board.

A large wave was spotted bearing down at 90º to the vessel. The captain moved back to the controls to turn the vessel eastwards but was too late to get it beyond 45º to the wave. The wave hit the vessel and dislodged the plaintiff, who was holding onto her daughter and the bow rail. The wave crashed over the bow and she was swept astern slamming her back into the rear of the bow area. The wave was considerably more than one metre high. The trial judge Ashford DCJ found the captain negligent in not removing passengers from the bow of the vessel when in the wave zone. The case also involved the construction of a waiver/exemption clause. But this is not relevant for this presentation. Her Honour found that dolphin watching was not a dangerous recreational activity within s.5K.

The lead judgment in the Court of Appeal was written by the President Mr Justice Mason. McColl and Hunt JJA agreed with him. The President stated that to determine the application of s.5K and s.5L it was necessary to look to the context in which the plaintiff placed himself or herself. Thus it was irrelevant for the defendants to rely on evidence concerning the risks of crossing the English Channel. There was nothing in the defendant's brochure to indicate that the vessel would be in the wave zone or that being swamped by a wave was one of the expected thrills of the cruise. The plaintiff did not expect to get wet. The brochure represented the activity as gentle. Thus in the context of the activity for which the plaintiff volunteered it was not dangerous within the definition of s.5K.

Inherent Risk:

Justice Mason in Xuereb also considered whether the risk was inherent within s.5I. This section states:

5I NO LIABILITY FOR MATERIALISATION OF INHERENT RISK

1. A person is not liable in negligence for harm suffered by another person as a result of the materialisation of an inherent risk.
2. An inherent risk is a risk of something occurring that cannot be avoided by the exercise of reasonable care and skill.
3. This section does not operate to exclude liability in connection with a duty to warn of a risk.

The definition of inherent risk is that which cannot be avoided by the exercise of reasonable care and skill. This was very quickly dealt with by the President in Xuereb who stated that on the contrary it was the want of reasonable care and skill by the captain that caused the injuries. He could have steered the boat out of the wave zone before leaving the wheelhouse. He could have directed that passengers not sit on the bow if he was to leave the wheelhouse in a wave zone.

It is difficult to consider what activities, other than those involving a very high risk that will be found to have an inherent risk. For example the risk of a parachute failing on skydiving is something that can be avoided by the exercise of reasonable care and skill; i.e. checking that the parachute is operational or packing a reserve chute. Skiing in avalanche territory is also something that can be avoided by the exercise of reasonable care and skill; i.e. by warnings of potential areas of risk by the relevant operator, guarding off avalanche risk areas and blasting areas where an overload of snow has developed.

What then can we learn about the few cases so far concerning dangerous recreational activity? The first we can learn is that judges may differ in their interpretation of any activity in a given circumstance. Thus it will only be after a significant quantity of cases that we can obtain some guidance, other than the usual rule which is that one should not rely on court decisions in risk management of litigation. Perhaps Falvo is the best case so far, concerning a common sporting activity, with some guidance by Justice Ipp.

Part 6 - Intoxication:

Thomas Vale v Timothy Eggins [2006] NSWCA 348:

Court of Appeal decision 11 December 2006.

This case concerned s.49. Sections 48 and 49 state as follows:

48 DEFINITION OF "INTOXICATION"

A reference to this Part to a person being intoxicated is a reference to a person being under the influence of alcohol or a drug (whether or not taken for a medicinal purpose and whether or not lawfully taken).

49 EFFECT OF INTOXICATION ON DUTY AND STANDARD OF CARE

1. The following principles apply in connection with the effect that a person's intoxication has on the duty and standard of care that the person is owed:
2. • in determining whether a duty of care arises, it is not relevant to consider the possibility or likelihood that a person may be intoxicated or that a person who is intoxicated may be exposed to increased risk because the person's capacity to exercise reasonable care and skill is impaired as a result of being intoxicated,
   • a person is not owed a duty of care merely because the person is intoxicated.
   • the fact that a person is or may be intoxicated does not of itself increase or otherwise affect the standard of care owed to the person.
3. This section applies in place of a provision of section 74 of the Motor Accidents Act 1988 or section 138 of the Motor Accidents Compensation Act 1999 to the extent of any inconsistency between this section and the provision.

The plaintiff was an intoxicated pedestrian whose blood alcohol reading as calculated by Professor Starmer was .179. He was stumbling across Anzac Parade, Chifley at 8.45 pm on Saturday 27 April 2002. At that point the roadway was three lanes going north separated from the southbound lanes by a raised grass nature strip. The defendant was a P plater travelling home from work in lane three closest to the median strip at approximately 60 kph which was the speed limit. He saw the plaintiff stumbling across the road in lane two when he was about 100 metres away. The defendant reduced speed to 50-55 kph and the plaintiff moved away from his line of travel. On seeing this the defendant accelerated. Unfortunately however the plaintiff turned and stumbled back into the path of the defendant's vehicle.

The trial judge her Honour Judge Gibson incorrectly stated that the intention of s.49 was that the plaintiff was not entitled to recover damages. She stated that having regard to that section the defendant had not been negligent.

This was clearly wrong because all the section says is that in determining the duty of care of a defendant it is not relevant to consider that the plaintiff was intoxicated. Intoxication does not increase the standard of care owed to the plaintiff. Thus the section really says nothing at all. Beazley JA, with whom McColl JA agreed, noted the Common Law standard of care of a motor vehicle driver to be that of an ordinary prudent driver acting reasonably in the circumstances. After finding for the defendant, Gibson J stated that if she was wrong then the plaintiff's contributory negligence was 75% given his extreme intoxication.

Her Honour Justice Beazley emphasised that s.49 simply meant that a plaintiff being intoxicated did not increase the duty or standard of care to him or her. But it did not effect the defendant's duty of care and did not say that a defendant could not be negligent. She stated that the trial judge had wrongly incorporated the provisions of s.50 into s.49. Thus the Appeal was allowed and the damages were reduced in accordance with the trial judge's finding of contributory negligence.

Justice Bryson was in dissent, but only in relation to the Common Law. He believed that the defendant driver had not been negligent. He agreed that s.49 had no effect on the case. Indeed he said:

The operation of s.49 is not in all respects clear to me…

It is at least curious that s.49 was made applicable to motor accidents whilst the other provisions of Part 6 were not…

s.49 does not have the effect that no duty of care is owed to a person who is intoxicated, and does not have the effect that a person who is intoxicated is not entitled to recover damages for that reason…

Thus it is difficult to see why s.49 was inserted into the Act at all, other than reflecting some fear in Parliament at the time that because people were intoxicated the duty of care to them may in certain circumstances be greater than normal.

Russell v Edwards & Anor [2006] NSWCA 19:

The Court of Appeal decision was delivered on 3 March 2006.

S.50 states as follows:

50 NO RECOVERY WHERE PERSON INTOXICATED

This was a case which we defended in the Newcastle District Court before her Honour Judge Sidis, and then in the Court of Appeal. The plaintiff was an intoxicated 16 years old who dived into the shallow end of a swimming pool at the defendants' domestic dwelling. There was no doubt that he was intoxicated and he admitted to this in evidence. The defendants were hosting a birthday party for their 16 years old son at the time. Mr Edwards provided a case of light beer for the guests. However many, including the plaintiff, brought their own spirits. The plaintiff consumed bourbon whisky. The party commenced at a barbeque on the back lawn and at about 10.00 pm Mr Edwards told the young people to move to the pool area. At times during the party he would go outside to ask them to keep the noise down.

The plaintiff had been swimming in the pool. The pool lights were on and the depth was easy to see. After spending about twenty minutes in the pool he got out and dived in the shallow end when he sustained his injury. Luckily his injuries were not catastrophic.

The trial judge had no difficulty in finding the defendants negligent at Common Law for failing to direct the young people to move out of the pool area. This was in the face of the Romeo and Cole line of authority (Romeo v Northern Territory Conservation Commission (1998) 72 ALJR 208, Cole v South Tweed Heads Rugby Football Club Ltd (2002) 55 NSWLR 113). Very reluctantly she found for the defendants on the basis of s.50(1) of the Act; the plaintiff being intoxicated at the time of the act which caused his injury.

The plaintiff's appeal was on two bases:

These arguments were rejected by the Court of Appeal. Ipp JA writing the lead judgment, Beazley and Hunt JJA agreeing.

Justice Ipp addressed the words "the act" in s.50(1). He referred to the case law in construing direct cause of loss in relation to insurance policies. He concluded that the use of the words "the act or omission" must refer to the act or omission that directly caused the death or injury. "Directly" was to be equated with "proximate". Thus he rejected the argument that a plaintiff could argue in relation to s.50(1) that the act or omission causing the death or injury was an earlier breach of duty by a defendant. The case confirms that it is the direct action which causes the injury which is determinative. Thus if a plaintiff commits an act whilst intoxicated leading directly to injury or death, then s.50 applies and in accordance with s.50(2) damages are not to be awarded, unless the injury was likely to have occurred even if the person had not been intoxicated.

Justice Ipp also rejected the argument on s.50(5). He looked at the case law concerning criminal responsibility where the accused was intoxicated. Unless the intoxication was so great that the person had no will to act or capacity to form an intent the guilt was not reduced. He found that "self-induced" is equated with "voluntary". Voluntariness is not negated by ignorance as to the quantity of liquor required to make one intoxicated. The Appeal was dismissed.

Given that the trial judge's decision on s.50 was upheld, the Court of Appeal did not consider whether she was wrong in finding breach of duty at Common Law.

Conclusion:

Justice Bryson in C G Maloney did issue a warning with respect to the construction of the Act. He stated:

The application of each particular provision should be considered in its statutory context and in relation to the facts of each particular case…Broad views and insights based on them should be deferred until there has been a significant accumulation of judicial experience on the operation of these provisions.

The "significant accumulation of judicial experience" will take some years.

As stated by his Honour Mr Justice Bryson it will not be until we see more appellate decisions that we will have a more measured view of the operation of the Act. At this stage on the relatively small number of cases considered it is my view that the duty of care provisions will not significantly change the Common Law. Indeed they were not intended to by the Ipp Panel in its recommendations in 2002.

However provided a defendant can prove dangerous recreational activity or intoxication at the time of an accident, the Common Law may be significantly restricted.

Patrick Thompson
27 February 2007

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