Abdel-Messih (A Child) v WA Country Health Service
[2007] WADC 70
•10 MAY 2007
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS
LOCATION: PERTH
CITATION: ABDEL-MESSIH (A CHILD) -v- WA COUNTRY HEALTH SERVICE [2007] WADC 70
CORAM: REGISTRAR KINGSLEY
HEARD: 22 MARCH 2007
DELIVERED : 10 MAY 2007
FILE NO/S: CIV 2250 of 2006
BETWEEN: REUBEN ABDEL-MESSIH (A CHILD)
Plaintiff
AND
WA COUNTRY HEALTH SERVICE
Defendant
Catchwords:
Practice - Application to dismiss plaintiff's statement - No reasonable cause of action - Claim of economic loss through negligent advice - Hospital administrator
Legislation:
Limitation Act 1935
Result:
Defendant's application dismissed
Representation:
Counsel:
Plaintiff: Mr J R Johnson
Defendant: Mr N C Monahan
Solicitors:
Plaintiff: Julian Johnson
Defendant: State Solicitor
Case(s) referred to in judgment(s):
Dalgety Australia Ltd & Anor v De Vahl Rubin & Ors; unreported; FCt SCt of WA; Library No 5485; 24 August 1984
Esanda v Peat Marwick Hungerfords (1997) 188 CLR 241
General Steel Industries v Commissioner for Railways (NSW) (1964) 112 CLR 125
Mutual Life and Citizens Assurance Co Ltd v Evatt (1968) 122 CLR 556
San Sebastian Pty Ltd v Minister Administering the Environment (1986) 162 CLR 340
REGISTRAR KINGSLEY: This is the defendant's application seeking orders that the entire statement of claim be struck out pursuant to O 20 r 19(1)(a) as disclosing no reasonable cause of action.
No reasonable cause of action – The law
General Steel Industries v Commissioner for Railways (NSW) (1964) 112 CLR 125 remains the leading authority in relation to striking out a statement of claim. Barwick CJ commented at [130] that the power to strike out a statement of claim is limited to cases so clearly untenable that it cannot possibly succeed. In Dalgety Australia Ltd & Anor v De Vahl Rubin & Ors; unreported; FCt SCt of WA; Library No 5485; 24 August 1984 the Court commented that the power to strike out a statement is reserved for cases where it is clear from the outset that, however the facts are found, there is no basis for the legal conclusion contended by the plaintiff.
Whilst having regard to contemporary case management practices, there may be a greater readiness to find there is no basis for the legal conclusion contended, it is still the case that where arguably a basis exists for the cause, the action will not be struck out.
The pleading
The Port Hedland Regional Hospital was, prior to July 1997, managed by the Port Hedland Hospital Board. Subsequent to July 1997 the hospital was managed by the East Pilbara Health Service.
The plaintiff was born in July 1994 at Port Hedland Regional Hospital. The statement of claim pleads that the Administrator of the hospital was Mr Pantany. Mr Pantany, it is pleaded, owed a non‑delegable duty of care to the plaintiff to ensure that reasonable care and skill was demonstrated by its servants, and reasonable care and skill was shown by Mr Pantany, in the advice that he gave to the plaintiff's next friend on behalf of the plaintiff. At par 5 of the statement of claim the plaintiff pleads that Mr Pantany owed the plaintiff a duty to exercise reasonable care and skill in the formulation and provision of the advice he gave to the plaintiff through his next friend, which advice he provided in the course of his employment with the Port Hedland Hospital Board.
The plaintiff pleads that there is an issue in relation to his medical care and at par 26 of the statement of claim pleads that there was a breach of duty by the medical staff in monitoring the plaintiff such that the plaintiff suffered harm.
At par 29 the plaintiff pleads that on or about 31 July 1994 the plaintiff's next friend wrote to the administrator Mr Pantany expressing concern at the quality of medical care. On or about 5 August 1994 the plaintiff's next friend met with Mr Pantany. At that meeting it is alleged the hospital had identified serious cause for concern in relation to the care and that steps had been taken to redress that concern. The plaintiff goes on to plead (par 31.2 and par 31.3) that in response to an inquiry by the next friend as to what would happen if the plaintiff developed problems at a later stage Mr Pantany indicated that a compensation damages claim could be taken against the hospital by the plaintiff's next friend at any time until he turned 25 years of age.
At a second meeting in August 1994 the plaintiff pleads at par 34 that Mr Pantany reiterated his advice to the plaintiff's next friend pleaded in par 31.3 that a compensation claim could be brought at any time until the plaintiff was 25 years of age. The plaintiff goes on to plead that, in reliance of the advice given by Mr Pantany, the plaintiff's next friend took no steps to investigate or pursue a medical negligence claim on the plaintiff's behalf until 2002. In a minute of proposed amended statement of claim the plaintiff seeks to plead that, at the time Mr Pantany gave the advice, he gave the advice with the intent and purpose of reassuring the plaintiff's next friend that there would be plenty of time for a compensation damages claim to be brought and there was an expectation or awareness that Mr Pantany may induce the plaintiff and the next friend to not pursue any compensation damages claim or seek legal advice until evidence of damage was identified.
The plaintiff goes on to plead that the advice given by Mr Pantany was false and that the time for any medical negligence claim brought against the Port Hedland Hospital Board had expired prior to the plaintiff's next friend first investigating pursuit of such claims.
In fact the plaintiff brought an action against the defendant and that action was dismissed by Williams DCJ because it was statute barred by s 47A Limitation Act1935.
The action the plaintiff now seeks to maintain is one of pure economic loss based on the alleged negligent advice of Mr Pantany. The loss is the lost opportunity to maintain the action that had been dismissed.
Defendant's submissions
The defendant's counsel submits it is absurd that a defendant, who is entitled to rely on a statutory bar, is not estopped from being held liable for alleged negligent advice. Further, counsel submits it is no part of the duty of the defendant to provide legal advice to the plaintiffs. The defendant's counsel submits that the advice pleaded was nothing about the hospital or its procedures; it was advice on the existence or otherwise of legal rights and the period during which those rights may be litigated.
Plaintiff's submissions
Plaintiff's counsel in his submission accepts that foreseeability of harm is not in itself sufficient to give rise to a duty of care on the part of the Hospital Board or Administrator. The plaintiff's counsel submits that proximity is required and this is an issue for trial as the full circumstances of the matter need to be analysed. The plaintiff's submission is that, in a case involving a direct statement of advice or information, it is not presently possible to precisely articulate the requirements for a duty of care to arise. The plaintiff's counsel also submits that policy may play a part in determining whether a duty of care should in particular circumstances be recognised.
The case law
Both plaintiff and defendant's counsel agree that the leading cases are that of San Sebastian Pty Ltd v Minister Administering the Environment (1986) 162 CLR 340 and Esanda v Peat Marwick Hungerfords (1997) 188 CLR 241.
In the San Sebastian (supra) case the Sydney City Council adopted a scheme to redevelop Woolloomooloo in accordance with a plan and documents prepared by the State Planning Authority. Ultimately the plan, whilst exhibited publicly, was abandoned. In reliance upon the plan developers bought land at Woolloomooloo in the expectation of profitable redevelopment. When the scheme was abandoned the land lost value and the developers claimed damages from the Council and the Authority for the loss suffered as a result of their reliance upon the scheme documents. The majority in San Sebastian commented that the maker of a statement may come under a duty to take care, through a combination of circumstances or in various ways, in absence of a request by the recipient. However, it is clear that a duty of care, in cases of negligence occasioning economic loss, cannot exist unless the statement was made by the defendant with the intention of inducing the plaintiff, or members of a class including the plaintiff, to act or refrain from acting in a particular way in reliance on the statement.
In Peat Marwick (supra) Toohey and Gaudron JJ commented:
"San Sebastian allows that there may be a relationship involving an assumption of responsibility where the person providing the information or advice intends or encourages another to act on the basis of its accuracy."
In the Peat Marwick case the question was whether, in an action for negligence for pure economic loss, it was sufficient to plead that it was reasonably foreseeable by an auditor that creditors and financiers of a corporation might rely on the audited accounts of the corporation, along with an unqualified auditor's report upon those accounts, in entering into their respective financial transactions. All members of the Court analysed the requirements that would give rise to a duty of care in those circumstances.
Brennan CJ commented that the uniform course of authority:
"… shows that it is necessary for the plaintiff to allege and prove that the defendant knew or ought reasonably to have known that the information or advice would be communicated to the plaintiff, either individually or as a member of an identified class, that the information or advice so communicated for a purpose that would very likely to lead the plaintiff to enter into a transaction of the kind that the plaintiff does enter into and that it would be very likely that the plaintiff would enter into such a transaction in reliance on the information or advice and thereby risk the incurring of economic loss if this statement should be untrue or advice unsound. If any of these elements are wanting, the plaintiff fails to establish the defendant owed the plaintiff a duty to use reasonable care in making the statement or giving the advice."
Thus for Brennan CJ attention must be paid to the transaction for which the statement was being made. It is the loss arising from such a transaction rather than "any loss" to which the duty of care extends.
McHugh J commented:
"Absence of 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."
Dawson J endorses the comments of Barwick CJ in Mutual Life and Citizens Assurance Co Ltd v Evatt (1968) 122 CLR 556:
"Whenever a person gives information or advice to another upon a serious matter (not merely social intercourse) where that person realises or ought to realise that he is being trusted to give the best of his information or advice as a basis for action on the part of the other and it is reasonable for that other to act on the information or advice, the person giving it is under a duty to exercise reasonable care in so doing."
Whilst perhaps there is no longer a convincing reason for confining liability for negligent misstatement to cases where there is a request for information or advice, the existence of such a request may assist in demonstrating reasonable reliance on the part of the person making the request.
Conclusion
In this action the plaintiff pleads that there is a request to Mr Pantany as to what the plaintiff's next friend ought do having regard to the alleged injuries suffered. The authorities are yet to identify precisely what it is that results in liability for economic loss suffered in consequence of the voluntary provision of information or advice. However, the authorities suggest 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.
Mr Pantany was in a position of authority in the hospital. It is open to a Court to find that Mr Pantany, by reason of his position, had some special expertise or knowledge. In my opinion, it is open for a court, to find that Mr Pantany must have realised that the plaintiff's next friend intended to act upon the information given by him. Having regard to Mr Pantany's position within the hospital, it is open to the Court to find that he was being trusted to give the best of his information or advice and that it was reasonable for the plaintiff's next friend to rely upon his statements and not seek his own legal advice.
Once I come to that conclusion I am bound then to dismiss the defendant's application on the basis that there is an arguable issue that needs to be tried.
The defendant's application is dismissed.
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