Amaca Pty Ltd v AB & P Constructions Pty Ltd
[2007] NSWCA 220
•29 August 2007
NEW SOUTH WALES COURT OF APPEAL
CITATION: Amaca Pty Ltd (under NSW External Administration) v A B & P Constructions Pty Ltd [2007] NSWCA 220
FILE NUMBER(S):
40412/06
HEARING DATE(S): 18 June 2007
JUDGMENT DATE: 29 August 2007
PARTIES:
Amaca Pty Ltd (under NSW External Administration) - Appellant
A B & P Constructions Pty Ltd - Respondent
JUDGMENT OF: Giles JA Ipp JA Basten JA
LOWER COURT JURISDICTION: Dust Diseases Tribunal, NSW
LOWER COURT FILE NUMBER(S): DDT 395/2004/1
LOWER COURT JUDICIAL OFFICER: Duck J
LOWER COURT DATE OF DECISION: 9 June 2006
LOWER COURT MEDIUM NEUTRAL CITATION:
(Re Lorizio) AB & P Constructions Pty Ltd v Amaca Pty Ltd (formerly James Hardie & Coy Pty Ltd) [2006] NSWDDT 19
COUNSEL:
G M Watson SC & J C Sheller - Appellant
J McIntyre SC & J L Sharpe - Respondent
SOLICITORS:
Phillips Fox Lawyers - Appellant
Thompson Cooper Lawyers - Respondent
CATCHWORDS:
Negligence - manufacture of asbestos-based product - duty of care owed to consumers - whether error of law in formulation of duty of care - content of duty of care - no error - if had been error, would have been error of fact - whether error of law in determining breach - no failure properly to evaluate relevant factors - whether error of law in finding causation - causation not relevantly in issue at trial - was evidence on which causation could be found.
LEGISLATION CITED:
Dust Diseases Tribunal Act 1989, s 32(1)
CASES CITED:
Anderson v The City of Enfield (1983) 34 SASR 472;
Brodie v Singleton Shire Council (2001) 206 CLR 512;
Cole v South Tweed Heads Rugby League Football Club Ltd (2004) 217 CLR 468;
Commissioner of Corrective Services v Walker [2007] NSWCA 213;
Donoghue v Stevenson [1932] AC 562;
Dovuro Pty Ltd v Wilkins (2001) 182 ALR 481;
Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540;
Grant v Australian Knitting Mills Ltd (1933) 50 CLR 387 (HC);
Great Lakes Shire Council v Dederer (2006) Aust Torts Reports 81-860; [2006] NSWCA 101;
Jones v Bartlett (2000) 205 CLR 166;
Leichhardt Municipal Council v Montgomery (2007) 81 ALJR 687;
McPhersons Ltd v Eaton (2005) 65 NSWLR 187;
Modbury Triangle Shopping Centre v Anzil (2000) 205 CLR 254;
Nagle v Rottnest Island Authority (1993) 177 CLR 423;
Neindorf v Junkovic (2005) ALJR 341, (2005) 222 ALR 631;
Norton Australia Pty Ltd v Streets Ice Cream Pty Ltd (1968) 120 CLR 635;
Trustees of the Roman Catholic Church for the Diocese of Canberra and Goulburn v Habda (2005) 79 ALJR 1195;
Sakoua v Williams (2005) 64 NSWLR 588;
Seltsam Pty Ltd v Ghaleb [2005] NSWCA 208;
Shellharbour City Council v Rigby [2006] NSWCA 308; (2006) 150 LGERA 11;
Skulander v Willoughby City Council [2007] NSWCA 116;
Sullivan v Moody (2001) 207 CLR 562;
Swain v Waverley Municipal Council (2005) 220 CLR 517;
Temora Shire Council v Stein (2004) LGERA 407;
Thompson v Johnson & Johnson Pty Ltd (1989) ATR 80-278;
Vairy v Wyong Shire Council (2005) 223 CLR 422;
Whittelsea City Council v Merie [2005] VSCA 199;
Woods v Multisport Holdings Pty Ltd (2002) 208 CLR 460;
Wright v Dunlop Rubber Co Ltd (1972) KIR 255;
Wyong Shire Concil v Shirt (1980) 146 CLR 40.
DECISION:
Appeal dismissed with costs.
JUDGMENT:
IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL
CA 40412/06
DDT 395/2004/1GILES JA
IPP JA
BASTEN JAWednesday 29 August 2007
AMACA PTY LTD (under NSW External Administration)
v
A B & P CONSTRUCTIONS PTY LTD
Judgment
GILES JA: The appellant, when James Hardie & Coy Pty Ltd, was a manufacturer of building products containing asbestos. It was held in the Dust Diseases Tribunal (“the Tribunal”) that it would if sued have been liable to a building worker who contracted mesothelioma through use of the building products, because it did not sufficiently warn of the risks in their use. It therefore had to contribute to the damages payable to the worker by his employer, the respondent.
The appeal challenges that the appellant owed to the worker a duty of care requiring that it warn of the risks in the use of the building products; breach of any duty; causal connection between any failure to warn and the worker’s condition; and the extent of contribution.
Facts
The worker was Mr Antonio Lorizio. He began his employment with the respondent in about January 1980, at the age of 16. He started as an apprentice carpenter, and over the years completed his apprenticeship and qualified as a carpenter and joiner and undertook further studies which resulted in him obtaining a Clerk of Works certificate. He remained employed by the respondent until mid-1998, when he left and became a sub-contractor on his own account.
The principal of the respondent was Mr Nino Restuccia. Mr Lorizio described Mr Restuccia as “my supervisor”, and Mr Restuccia said that Mr Lorizio generally worked with him or in his presence. The respondent’s building work was both renovations/extensions and building new houses, mainly the former but 10 to 20 per cent the latter.
Building a new house usually began with demolition of an existing house. The demolition was sometimes of an old fibro (asbestos cement) house, which was done with hammers or sledge hammers and was dusty at times. Renovations and extensions also involved work with old fibro by demolition or by cutting and joining, and for cutting the old fibro an angle grinder was used.
Building a new house and renovations/extensions could involve new asbestos cement products. The appellant’s products used by Mr Lorizio were a compressed asbestos cement sheeting used as flooring in wet areas and asbestos cement wall claddings known as Villaboard, Hardiflex, Hardiplank and Hardiplank Woodgrain (“the products”). The products were in sheets which had to be cut to size and drilled for fixing, depending on the job and the method of fixing. The flooring was cut with an angle grinder or a power saw with a special abrasive disc. The wall cladding was cut with fibro cutters, an angle grinder or a power saw, depending on the product. Cutting the products with an angle grinder or a power saw released respirable asbestos fibres into the air.
Mr Lorizio said that between 1980 and 1998 about 10 per cent of his work was work with old fibro, either demolition or cutting and joining. According to Mr Restuccia a lesser percentage of work was with old fibro. The judge said, correctly, that measurement of such a thing could not be undertaken, and that it was enough that on any account demolition work (in which I think he included all work with old fibro) did not involve a great deal of Mr Lorizio’s time.
Mr Lorizio said that in the four to five years from 1980 about 20 per cent of his working time was with new asbestos cement products. Mr Restuccia’s estimate was the same. The products were reconstituted at different times during the 1980’s so as not to contain asbestos, and Mr Restuccia said that the asbestos cement products were used until about 1985. Mr Lorizio had about five years’ exposure to asbestos dust and fibres from the products.
Most of the new asbestos cement products with which Mr Lorizio worked were the appellant’s products. Occasionally Mr Restuccia, who did the purchasing, brought Wunderlich products.
Commencing in about 1978/1979, the appellant fixed stickers to the products. The stickers stated that the products contained asbestos and cautioned the user in their use.
The sticker used until about 1982 was rectangular with a horizontal long axis. The left-hand one third bore a large “a”, beneath it in large print “Caution” in white on a red background, and beneath that -
“This product contains asbestos. Breathing asbestos dust can damage health. Keep dust down”
On the right-hand two thirds of the sticker was printed -
“This product contains a small percentage of asbestos bound firmly into it by cement and other materials. Asbestos dust can damage health. Keep dust down by following these simple safety rules:
1.When sawing, drilling, etc. work in a well ventilated space, preferably outdoors.
2.Use hand tools designed for cutting asbestos-cement sheets such as fibro cutters or a score and snap knife – or use an old hand saw. If cutting by power saw use one which has a dust suppression attachment.
3.Avoid drilling overhead where possible by pre-drilling before fixing.
4.Damp down waste dust and dispose of it in a sealed bag.
NOTE: When fixed in position, asbestos cement sheets present no known risk to health.”
In about 1982 the sticker changed in form and to some extent in wording. It became an elongated rectangle with a vertical long axis. The top half contained the “a” and the Caution, and a varied wording -
“Contains asbestos fibre. Avoid creating dust. Breathing asbestos dust may cause serious damage to health including cancer. Smoking greatly increases the risk. In accordance with N.H. & M.R.C. recommendation.”
On the bottom half of the sticker was printed a slightly varied wording -
“This is an AC building product manufactured by James Hardie & Coy.Pty.Limited which contains a small percentage of asbestos bound firmly in by cement and other materials.
When cutting or drilling follow these simple safety rules:
1.When sawing, drilling, etc work in a well ventilated area, preferably outdoors.
2.Use hand tools designed for cutting asbestos-cement sheets such as fibro cutters or a score and snap knife – or use an old hand saw. If cutting by power saw use one which has a dust suppression attachment.
3.Avoid drilling overhead where possible by pre-drilling before fixing.
4.Dispose of any waste and dust in a safe manner.
NOTE: When fixed in position, asbestos cement sheets present no known risk to health.”
The appellant also issued technical bulletins and other brochures, available at retail outlets selling the products, which included information as to their use. There were a number of brochures. It is sufficient to refer to the extracts cited by the judge.
One extract was from a 1978 Villaboard brochure -
“When fixed into position Hardie’s asbestos cement building products present no known risk to health. They contain a small percentage of asbestos bound firmly into the product by cement and other materials. Breathing asbestos dust can damage health. As a precaution you should keep dust levels down by working in a well ventilated space. Use hand tools designed for cutting asbestos cement, a power saw with a dust suppression attachment or an old handsaw. Damp down waste dust and dispose of it in a sealed bag.”
Another extract was from a 1978 Home Improvements for the Handyman brochure -
“Caution: Hardie’s asbestos cement building products contain a small percentage of asbestos bound firmly into the products by cement and other materials. Asbestos dust can damage health and under normal circumstances this is unlikely when using asbestos cement sheets. As a precaution, however, you should keep dust levels down by following these simple safety rules.”
The third extract was from a 1978 Hardiflex brochure -
“When fixed into position Hardie’s asbestos cement building products present no known risk to health. They contain a small percentage of asbestos bound firmly to the product by cement and other materials. Breathing asbestos dust can damage health. As a precaution you should keep dust levels down and work in a well ventilated space.”
The judge noted a number of other brochures containing statements in similar terms, and some which did not have any warning at all.
The evidence included a press release by the appellant and an item in the Building Product News, both in 1979 and in connection with the introduction of stickers. They were more remote from users such as Mr Lorizio, and did not convey greater warning than the stickers or brochures. The judge took account of them, but I do not think it necessary further to describe them.
Mr Restuccia saw brochures about the appellant’s products, although he could not recall some particular brochures shown to him. He also saw the stickers, and the judge described his evidence about seeing them; I will refer to some of the evidence later in these reasons. The judge did not make a detailed finding about Mr Restuccia’s knowledge of warnings. From Mr Restuccia’s evidence, he was unaware until being told that asbestos had been taken out of the products that the asbestos was dangerous, and when asked if he did anything to inform himself of potential hazards or risks he said that he did not know himself. In connection with contribution, the judge said at [46] that the respondent through Mr Restuccia “saw the warning signs but paid no attention to them”. The judge did not accept that at some time before asbestos was removed from the products Mr Restuccia told employees that masks should be worn when using them.
Mr Lorizio’s evidence was given by the tender of an affidavit used in his claim against the respondent. Because of his state of health, he did not give oral evidence and was not cross-examined. He said that he was not warned of any health risks associated with the use of asbestos cement building products, that he did not wear a mask when doing demolition work, and that the power tools he used were not fitted with dust control equipment. He said, “Had I known of any such risk I would not have worked with or near such fibro materials”. His evidence made no mention of the stickers or brochures.
Mr Lorizio was diagnosed with mesothelioma in 2004. He brought proceedings against the respondent in the Tribunal, alleging negligence in exposing him in the course of his employment to the inhalation of asbestos dust and fibre as a result of which he contracted the mesothelioma. The proceedings were settled with a verdict and judgment for Mr Lorizio for $1,000,000 inclusive of costs.
The respondent cross-claimed against the appellant claiming contribution pursuant to s 5 of the Law Reform (Miscellaneous Provisions) Act 1946, on the basis that the appellant manufactured the products and would if sued by Mr Lorizio have been liable for the “same damage” (that is, Mr Lorizio’s condition) as was the respondent. The appellant accepted for the purposes of the cross-claim that the settlement was reasonable. The dispute was over its hypothetical liability to Mr Lorizio and the extent of contribution.
The grounds of appeal
There could relevantly be appeal to this Court by the appellant if “dissatisfied with a decision of the Tribunal in point of law”: Dust Diseases Tribunal Act 1989, s 32(1). The nature of the dissatisfaction has recently been discussed by Basten JA in Seltsam Pty Ltd v Ghaleb [2005] NSWCA 208 at [148]-[156]. For the present the expression can be equated with material error of law in coming to the decision, but I will return to the precise expression.
The grounds of appeal were -
“1.The trial judge erred in law in incorrectly formulating the content of any duty of care owed by the appellant to Mr Lorizio.
2.The trial judge erred in law in holding that the appellant had breached its duty of care, in the context of an incorrectly formulated duty.
3.The trial judge erred in law in finding that any breach of duty by the appellant caused or contributed to the injury suffered by Mr Lorizio.
4.The trial judge erred in law in fixing the apportionment between the appellant and the respondent.”
In the presentation of the appeal ground 2, while still linked with ground 1, was not dependent on an incorrect formulation of the duty of care. It became the ground, as an alternative, that the judge erred in law in finding breach of the duty of care. The appellant submitted that the knowledge of risks in the use of asbestos cement products was at the time such that in the formulation of the content of its duty of care there was no duty to warn users of a risk to health in the use of asbestos cement products, and that the judge incorrectly gave the duty of care the content of a duty adequately to warn of the risk; and in the alternative that the knowledge of risks in the use of asbestos cement products was at the time such that there was no breach of its duty of care in failure to warn of a risk to health. The submission in both alternatives rested upon the contention that at the time the risk to health in the use of asbestos cement products was negligible and did not call for any warning to users of the products.
The judge’s reasons
I describe the judge’s reasons only so far as material to grounds 1 and 2. As will appear, the causation issue on which the appellant relied for ground 3 was not dealt with in the reasons, and it is not necessary to describe the reasons in relation to contribution in considering ground 4.
The judge held that the appellant did not owe to Mr Lorizio a duty of care in relation to the old fibro encountered in demolition or in renovation and extension work. The only duty of care was in relation to the manufacture of the new asbestos cement products. There was no appeal against that holding.
The judge said at [16], referring to the stickers fixed by the appellant to the products -
“An issue in the case is whether or not those stickers constituted a sufficient warning of the dangers so as to discharge a duty which in the running of this case Hardies has not disputed that it had, to warn people of the risks of asbestos.”
After dealing with other matters, the judge said at [26] -
“I have indicated that I am satisfied that from 1978/1979 warnings started to appear on the products. It is convenient I think now to look at the content of those warnings and at the question of whether or not they were sufficient. The context within which that examination might be undertaken might conveniently be provided by reference to a couple of authorities.”
His Honour then referred to Anderson v The City of Enfield (1983) 34 SASR 472, citing passages from the judgment of King CJ, and to Thompson v Johnson & Johnson Pty Ltd (1989) ATR 80-278, citing passages from the judgment of Vincent J.
The first citation from Anderson v The City of Enfield was of two passages at 476 -
“The manufacturer and distributor of an inherently dangerous product owes a duty to give adequate warning to people into whose hands the product may come of the dangerous qualities of the product. … [The manufacturer] was therefore under a duty to the plaintiff to give such a warning, although, of course, not necessarily to give it direct to the plaintiff. The nature and extent of the warning which is necessary to discharge the duty must depend upon the degree of risk involved in the use of the product and the circumstances of its distribution.”
In the third passage cited from Anderson v The City of Enfield King CJ stated that the “real point for determination” was whether the words of warning on the product there in question were, in the context in which they appeared, “adequate to bring home to a user the gravity of the danger involved in contact with the skin by the product”.
The references to Thompson v Johnson & Johnson Pty Ltd included noting that the plaintiff, who alleged toxic shock from the use of tampons, failed “because the state of knowledge at that time was insufficient to reasonably require the manufacturer to provide such a warning”. The judge set out the citation by Vincent J at 68,965-6 from the decision of the Court of Appeal in England in Wright v Dunlop Rubber Co Ltd (1972) KIR 255 at 272 -
“It is obvious that the answer to the question, what are reasonable steps, must depend upon the particular facts. It is obvious also that the duty is not necessarily confined to the period before the product is first produced or put on the market. Thus if when a product is first marketed there is no reason to suppose that it is carcinogenic but thereafter information shows or gives reason to suspect that it may be carcinogenic the manufacturer has failed in his duty if he has failed to do whatever may have been reasonable in the circumstances in keeping up to date with the knowledge of such developments and acting with whatever promptness fairly reflects the nature of the information and the seriousness of the possible consequences. If a manufacturer discovers that the product is unsafe or has reason to believe that it may be unsafe his duty may be to cease forthwith to manufacture or supply the product in its unsafe form. It may be that in some circumstances the duty would be fulfilled by less drastic action: by, for example, giving proper warning to persons to whom the product is supplied of the relevant facts as known or suspected giving rise to the actual or potential risk. Factors which would be relevant would be the gravity of the consequences if the risk should become a reality, and the gravity of the consequences which would arise from the withdrawal of the product. In making these assessments the nature and extent of the risk thought to have arisen, the economic and other costs involved in addressing that risk as well as the practical difficulties in doing so and the seriousness of the potential consequences would all have to be taken into account.”
After noting that Thompson v Johnson & Johnson Pty Ltd had been referred to with approval by Finkelstein J in Dovuro Pty Ltd v Wilkins (2001) 182 ALR 481, his Honour said at [31] -
“I do not think it is seriously disputed that by 1980 Hardies had a duty to warn, the question is whether or not that duty has been satisfactorily discharged.”
Referring in turn to the warnings in the various stickers and brochures, and to the press release and the Building Product News, the judge was not satisfied that they sufficiently warned of the risks of the asbestos in the products.
As to the warning in the pre-1982 sticker, the judge said at [32] -
“These cautions contain no reference to contracting mesothelioma, cancer or other lung disease, they are anodyne in the extreme. The note with which the caution is finished tends to convey the idea that there really is no problem and that this cautionary label is being affixed as a matter of form.”
As to the warning in a post-1982 sticker, he said -
“33. The only difference relevantly between this caution and the one before mentioned is that two words are slipped in, that is to say ‘including cancer’. The same comments apply in respect of it. Further its form is an imitation of the form which had previously prevailed, and how anyone is likely to pick up reference to the words "including cancer" is not clear. It is to be remembered that these materials are to be used by people doing building work. I do not think that a caution in that form is sufficient to attract the attention, firstly, of those to whom it is directed. Secondly, the content of the caution is insufficient to bring home the real risks associated with the inhalation of asbestos dust.
34. The other relevant matter about what was affixed to the sheeting is, as was pointed out by Mr Sharpe in submissions, these stickers were being attached to sheets which might be 9 or 10 feet long and several feet wide in some cases. That simply emphasises, I think, the inadequacy of the caution contained in the document.”
As to one of the brochures, the judge said at [36] that “[f]or the same reasons that is simply not adequate to bring to attention the serious risks associated with the use of the product”. Importantly in the light of the appellant’s submission concerning the knowledge of the risks in the use of asbestos cement products, he continued -
“In a little while I need to come back to considerations of what is equitable and just but relevant to that later issue is this comment, that the evidence discloses that the cross defendant was aware of these risks. Mr Bagot said he knew of them in the late 1960s. Not only did he know about them, he used to go around as did others, on sales promotions warning people of the dangers of which he was aware. Given that fact the blandness of these warnings is even more striking.”
The judge did not find any more acceptable other brochures, or the press release or the Building Product News. At one point he said of the press release that it “camouflages the real risks to which people using the product may be exposed”. He said as a summary-
“41. I think I have touched on the brochures that have been tendered in respect of products containing asbestos at the relevant time. At the risk of repeating myself, it seems to me that those brochures do not contain warnings which bring home to users of the product the real risk that the inhalation of asbestos dust posed to them. One may go further, perhaps, but it is not necessary to do so, the issue for determination is whether the warnings were sufficient. I do not think they were.”
The judge concluded -
“42. The conclusion which flows from those matters is that Hardies did not discharge the duty to warn which the circumstances placed on it. It is to be concluded therefore that they would, if sued, have been liable in respect of the same damage suffered by the plaintiff.”
The judge then considered contribution, in the course of which he amplified the reference in his [36] to the appellant’s knowledge of risks. He said -
“43. Firstly, I deal with those factors which militate against the interests of Amaca. The first and obvious thing to say is that Hardies knew of the risks. Mr Bagot said so whereupon it was suggested that his evidence at T60-61 did not specify that he was attempting to deal with asbestos cement sheeting. Two responses may be made: firstly, that is not altogether clear, having regard to the context in which those questions were put to him. Secondly, in any event, he went on to say that he and others used to go around to sales events promoting the product and warning people specifically of the dangers of asbestosis, lung cancer and the like. That speaks of actual knowledge on the part of himself and of the other employees of the company. That is a significant matter.
44. In dealing with this topic may I touch on some evidence which was introduced in the case which did not help. Opinion evidence was tendered from Dr Ferguson and Ms Sowden. It was tendered pursuant to s 25(3) of the Dust Diseases Tribunal Act as general historical evidence. In part it was but it was heavily laced with the opinions of the witnesses. The thrust of those opinions was that the general state of knowledge was such that Hardies could not be expected to know of the risks associated with asbestos cement products, and further, in the case of Ms Sowden, that warnings were of no great efficacy anyway. The evidence about the state of knowledge was given, as I say, pursuant to the section, but it meant that the witnesses were not heard, were not cross-examined in these proceedings, although transcript of their cross-examination from ten years ago was tendered. The thrust of their evidence is completely undone by what Mr Bagot had to say about the knowledge of the company and its employees. Further, I wonder, given the instructions furnished by the company, why that evidence was introduced at all. The matter was not discussed at length and I will say no more about that, but I think it proper to record my concern.”
Also importantly in the light of the appellant’s submission concerning knowledge of risks, the judge concluded his reasons -
“48. There is a matter which I need to address which is a submission by the cross-claimant that having regard to the knowledge that Hardies had it was negligent of them to keep marketing the product. I have touched on the principles already in the cases to which I have made reference. From the point of view of the company if that step were taken the documents in evidence suggest that 2000 people would be put of out work, they would have no product to sell for a number of years, perhaps as many as ten and the effect would be generally commercially catastrophic. On the other hand the product was a useful cheap building product much in demand and needed in the community over a number of years. Had proper warnings been given about how to deal with the product matters might have unfolded in a much less unsatisfactory way than they have. The consideration of matters such as this involves a balancing. I do not believe that the reasonable response was simply to shut down the factory but much more might have been done to protect the end users of the product than was done.”
Duty of care
The hypothetical liability of the appellant to Mr Lorizio was liability for the tort of negligence. For liability in negligence it is necessary that the defendant owed a duty of care to the plaintiff, that the defendant breached the duty of care, and that the breach caused loss to the plaintiff. Whether the defendant owed a duty of care to the plaintiff is a question of law. The bald proposition must be qualified, see later in these reasons.
Deciding whether the defendant owed a duty of care to the plaintiff includes determining the scope, extent or content (all three words are used) of the duty of care. The content may be found in, for example, the formulation of the duty of care as a duty of care to avoid physical injury, on the one hand, or economic loss, on the other hand, or with more specificity such as in exclusion from an occupier’s duty of care owed to entrants of a duty to take care to avoid physical injury resulting from the criminal behaviour of third parties on the land (see Modbury Triangle Shopping Centre v Anzil (2000) 205 CLR 254). The question of content in determining the existence of a duty of care has become more prominent in recent times, see the discussion of High Court jurisprudence by Mason P in McPhersons Ltd v Eaton (2005) 65 NSWLR 187 at [3]-[13]. His Honour concluded at [11] that additional matters may be “factored in at the duty stage”, but “only for some situations”. He referred to confinement of a landlord’s duty of care to particular kinds of defect (Jones v Bartlett (2000) 205 CLR 166, as analysed by his Honour in Sakoua v Williams (2005) 64 NSWLR 588), and to whether the duty of care owed by highway authorities to users of highways is confined to users who take reasonable care for their own safety (Whittelsea City Council v Merie [2005] VSCA 199; cf Temora Shire Council v Stein (2004) LGERA 407). His Honour held, in common with Hodgson and Ipp JJA, that the duty of care owed by a retailer to take care to avoid injury to users of products is confined by regard to the retailer’s knowledge of their dangerous qualities.
Many cases, however, have said that ordinarily the inquiry into the content of the duty of care is “at a relatively general level of abstraction”: the phrase is from Neindorf v Junkovic (2005) ALJR 341, (2005) 222 ALR 631 at [50] per Kirby J. As was said by Gummow and Hayne JJ in Cole v South Tweed Heads Rugby League Football Club Ltd (2004) 217 CLR 468 at [56], the more specific the formulation of the duty of care, the greater the prospect of mixing the anterior question of the existence of the duty with questions of fact in deciding whether a breach has occurred. In Neindorf v Junkovic Kirby J described at [52]-[55] the reasons why defining the scope of the duty of care “in an overly specific fashion” (at [52]) should be avoided. The danger of mixing duty with breach by an overly specific duty of care has been noted in, for example, Brodie v Singleton Shire Council (2001) 206 CLR 512 at [309] (Hayne J); Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 at [106] (McHugh J); and Vairy v Wyong Shire Council (2005) 223 CLR 422 at [20]-[29] (McHugh J), [58]-[61] (Gummow J), [118]-[119] (Hayne J).
Referring to content when deciding whether a duty of care was owed should be distinguished from referring to content when deciding whether the duty of care has been breached. The latter is a usage in considering the reasonable response to the risk of injury in the manner described by Mason J in Wyong Shire Council v Shirt (1980) 146 CLR 40 at 47-8. It also gives rise to a danger of mixing duty with breach. In Vairy v Wyong Shire Council at [29] McHugh J said that it risks conversion of a question of fact, what is required to discharge the defendant’s duty of reasonable care, into a question of law, what is the duty. There can be particular confusion if the two usages are not kept distinct.
The error asserted by the appellant was not that its duty of care incorrectly descended to the specificity of a duty to warn of the risk to health from asbestos. The appellant embraced such descent, in order to make out a question of law. The asserted error was, as earlier noted, that the knowledge of risks in the use of asbestos cement products was at the time such that in the formulation of the duty of care there was no duty to warn users; so there was no breach in failing to warn.
For two reasons, there was no error of law. First, the appellant’s duty of care owed to Mr Lorizio was a broadly stated duty, not with the content of a duty to warn users, and on a proper understanding of the judge’s reasons he did not give it that content. Secondly, if there had been error in giving it that content, it would have been error of fact.
In Leichhardt Municipal Council v Montgomery (2007) 81 ALJR 687, (2007) 233 ALR 200 Gleeson CJ said at [8], speaking of the level of abstraction at which a duty of care should be formulated -
“In any action in negligence, a proposition about a duty of care must be capable of being expressed in a manner that would enable a judge to direct a jury how to set about deciding whether there had been a breach. This is not difficult in well established areas such as litigation arising out of industrial accidents, motor vehicle accidents, occupiers' liability or professional negligence. It may be otherwise, however, in cases which lie at the boundaries of the law of negligence. There, the separation of issues of law (affecting duty) from issues of fact (affecting breach) may be more problematic. (In this context I include among issues of fact questions of normative judgment that often affect decisions about reasonableness).”
The relationship between the appellant and Mr Lorizio was that of manufacturer of a product and user of the product. That is a well established area of litigation, not at the boundaries of the law of negligence. The content of the appellant’s duty of care was at the general level of a duty to take reasonable care to avoid physical injury. The reasonableness of the appellant’s conduct was then to be assessed by regard to the risk of injury and the response of a reasonable man to the risk, in accordance with the balancing described by Mason J in Wyong Shire Council v Shirt.
In Graham Barclay Oysters Pty Ltd v Ryan McHugh J said -
“106 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. … “
Graham Barclay Oysters Pty Ltd v Ryan had many parties, but the oyster grower and the consumer of oysters were in the relationship of manufacturer and user. It was accepted that a general duty of care was owed, and the contest was over breach of duty, see at [41]-[42] per Gleeson CJ. [187] per Gummow and Hayne JJ, [253] per Kirby J. McHugh J at [101] referred to the scope of the duty owed, but by his [106] determined the scope as the general duty of care.
McHugh J cited Donoghuev Stevenson [1932] AC 562 at 599 for the first sentence of his [106] set out above. The citation is a reminder that, apart from the famous “neighbour principle” for which the case is remembered, Lord Atkin there stated the narrower principle that -
“ … a manufacturer of products, which he sells in such a form as to show that he intends them to reach the ultimate consumer in the form in which they left him with no reasonable possibility of intermediate examination, and with the knowledge that the absence of reasonablecare in the preparation or putting up of the products will result in an injury to the consumer’s life or property, owes a duty to the consumer to take that reasonable care.”
In Grant v Australian Knitting Mills Ltd (1933) 50 CLR 387 (HC); (1935) 54 CLR 49 (PC) the duty of care of the manufacturer of underpants, founded on Donoghue v Stevenson, was to take reasonable care to avoid injury (per Starke J at 409) or to take care in its manufacturing process so as to avoid injury (per Evatt J at 439-41 and in the Privy Council at 63). In Norton Australia Pty Ltd v Streets Ice Cream Pty Ltd (1968) 120 CLR 635, which concerned an inflammable adhesive, Barwick CJ at 642-3 described the manufacturer’s duty as a duty to take reasonable care, the parties accepting that “the relevant act in performance of [the manufacturer’s] duty” was giving an adequate warning of the dangerous qualities of the adhesive. In Vairy v Wyong Shire Council Gummow J observed at [63] that in many well-settled areas of the law of negligence the existence of a duty of care “presents no challenge”, and that after Donoghue v Stevenson “it was accepted that manufacturers of mass produced goods intended for human consumption owed a duty of care to ultimate consumers”.
The correct approach in the present case, then, was that the appellant owed to Mr Lorizio a duty to take reasonable care avoid risk of physical injury; and whether it was in breach of that duty involved determining the reasonable response to the risk of injury and any failure in that reasonable response. Giving a warning was not necessarily the reasonable response. The reasonable response of the manufacturer of a product may be to warn of the risks in its use, it may be to cease manufacturing the product (as was found in Wright v Dunlop Rubber Co Ltd), it may be to manufacture with different materials, or it may be to manufacture with greater care (as could have been the case in Grant v Australian Knitting Mills Ltd, although negligence was not found).
It was not essential that the judge elaborate the separate steps in the correct approach. In the conduct of a trial much is often common ground, and goes unstated or brings short-hand expression of a central issue for determination. It occurs not infrequently that, a motorist’s duty of care owed to other motorists being common ground, the issue for determination is stated in terms such as whether the defendant was under a duty to keep a proper lookout. The broadly stated duty not being in doubt, that means whether in the particular case the defendant breached the duty of care. The expression of a duty with the content of keeping a proper lookout is incorrect, but does not bring error if on the reading of the reasons as a whole the issue is determined as one of breach rather than formulation of the duty of care. That was the case in Anderson v The City of Enfield. King CJ noted at 475 that the plaintiff’s case was that the manufacturer owed a duty to give a reasonable warning of the danger inherent in the product, and the case proceeded to the issue of whether the warning given was adequate.
As is evident, the judge did not expressly proceed by stating a duty to take reasonable care to avoid physical injury to users of the products, then finding that the reasonable response to the risk of injury was to give an adequate warning, and then finding that the warning given was inadequate. He stated a duty of care as a duty to give adequate warning of the risks of asbestos, then asked whether the warnings given were sufficient and found that they were not.
This did not articulate the correct approach. But a judge’s reasons must be read as a whole, and in my opinion the judge spoke of a duty to give adequate warning of the risks of asbestos as the expression of a central issue for determination. I do not think he took giving an adequate warning of the risks of asbestos as the content of the duty of care. Rather, he treated an adequate warning as the reasonable response according to a Wyong Shire Council v Shirt assessment.
On my understanding of the reasons the judge meant, by the words in his [16] “which in the running of this case Hardies has not disputed”, that the appellant did not dispute that it owed a duty of care to users of the products. In the conduct of the proceedings the appellant did dispute that its duty of care required that it warn users of the risks of asbestos, and the judge did not pass over the dispute. What was not disputed must have been a broadly stated duty of care. The appellant had given warnings, by the stickers and brochures, and it was not unexpected that attention became focussed on the adequacy of the warnings. That central issue was considered, in varying language, as a duty to give adequate warning of the risks of asbestos. But the judge did not confine attention to warning. He extracted from Wright v Dunlop Rubber Co Ltd its reference to the alternative reasonable steps of ceasing to manufacture in an unsafe form or giving proper warning, and in his [48] considered negligence in continuing to market the products. From the judge’s consideration of negligence in continuing to market the products, it is apparent that the duty of care was not confined to, and given the content of, a duty to warn.
Let it be assumed, however, that the judge adopted a duty of care with the specificity of a duty to give adequate warning of the risks of asbestos. The appellant did not submit that this was itself an error of law. Its argument was that, from publications of the National Health and Medical Research Council and from the evidence of Professor David Ferguson and Mrs Janet Sowden admitted under s 25(3) of the Dust Diseases Tribunal Act, at the time it was believed that the risks associated with the use of asbestos cement products was negligible and warnings to users were unnecessary. For that reason, it said, there was error of law in a duty of care with the content that the appellant give adequate warning of the risks of asbestos.
The evidence on which the appellant relied did not go so far as to exclude knowledge of risks calling for a warning. As an example, Mrs Sowden’s evidence included that by 1980 she recommended that power tools not be used for cutting on building sites, or that if used they be dust suppressed or there be water damping. It is not necessary to go into this, since the publications and the evidence of Professor Ferguson and Mrs Sowden was not the only evidence.
Mr Bagot was in a managerial position with the appellant, and in 1981-2 was heavily involved in the programme to convert its building products from asbestos cement products to asbestos free products. He said that he was aware of risk to health from inhaling asbestos dust from 1969 onwards, not only asbestosis but also mesothelioma. When he gave presentations at stores he warned of the risk of lung cancer, and told those present that masks should be worn when cutting the asbestos cement products and not to use an angle grinder.
The judge referred to Mr Bagot’s evidence in his [36] when considering the adequacy of the warnings, and in his [43] when considering contribution, regarding it as evidence of serious risks associated with the use of the products known to the appellant. He plainly accepted it. This was a question of fact, found against the appellant, and the evidence of Mr Bagot entitled the judge so to find.
Earlier in these reasons I referred to qualification of the bald proposition that whether the defendant owed a duty of care to the plaintiff is a question of law. The defendant’s duty of care may turn on a question of fact. A stark illustration is that, while the driver of a motor car owes a duty of care to other motorists, it is not unknown for there to be dispute over whether the defendant was the driver of the offending motor car. In the present case, if the appellant’s duty of care was to have the content of a duty to give adequate warning of the risks of asbestos, that depended on whether there was knowledge of serious risks associated with use of the products. Any error in adopting a duty of care with the content in question was in substance an error of fact, because founded on finding that knowledge. To return to the expression “dissatisfied with a decision of the Tribunal in point of law”, the dissatisfaction was not in point of law, but with the finding of fact.
Breach of duty
Although he did not refer to Wyong Shire Council v Shirt, the judge had well in mind the balancing of which Mason J spoke in that case. In his [48] he said that consideration of matters such as whether the appellant was negligent in continuing to market the products “involves a balancing”, and referred to what was “a reasonable response”. This reflected the words of Mason J. There is no valid reason for concluding that the judge disregarded that approach in finding that there was a failure to give adequate warning of the risks of asbestos, on a reading of the reasons as a whole meaning that the reasonable response to the known serious risks was to give the users an adequate warning of the risks of asbestos, and that the appellant had failed to do so. The judge did not expressly refer to Wyong Shire Council v Shirt; neither did the High Court in Trustees of the Roman Catholic Church for the Diocese of Canberra and Goulburn v Habda (2005) 79 ALJR 1195, but it is clear from the reasons that it underlay their Honour’s consideration of breach of the duty of care.
The reasonable response to the risk of injury was a question of fact, at most open to challenge if there was error in principle or the finding was not reasonably open because it involved a normative judgment (Woods v Multisport Holdings Pty Ltd (2002) 208 CLR 460 at [137]-[140] per Hayne J; Graham Barclay Oysters Pty Ltd v Ryan at [49] per Gleeson CJ; whether there can be that limited room for dissatisfaction in point of law was not argued and does not arise). So also was whether the warnings given were adequate a question of fact. Unless there was no evidence on which the judge could find the reasonable response and the appellant’s failure, the judge’s determination could not be afflicted by error of law.
The argument earlier described was applied also to error in relation to breach of duty. However, there was evidence of serious risks associated with use of the products, and if there was any error it was error of fact in accepting and acting upon the evidence of Mr Bagot in preference to the evidence of Professor Ferguson, Mrs Sowden and that provided by the publications.
The appellant’s submissions included that there had not been what Gummow and Hayne JJ described in Graham Barclay Oysters Pty Ltd v Ryan at [192] as the “proper enquiry as to breach”. Their Honours said -
“That inquiry involves identifying, with some precision, what a reasonable person in the position of the defendant would do by way of response to the reasonably foreseeable risk. As Isaacs ACJ observed in 1924, ‘[n]o conclusion of negligence can be arrived at until, first, the mind conceives affirmatively what should have been done’. The trial judge and the majority of the Full Court in the present case failed to identify with the necessary precision, by reference to considerations of the nature of those indicated in Wyong Shire Council, the reasonable response to the risk of harm that existed. In so failing, their Honours fell into an error of law.”
In my opinion, the judge did conceive affirmatively what should have been done. He did not directly state it as his own finding, but in particular through the citations from Anderson v The City of Enfield and by what he said in his [16] and [31] he found that it was to give an adequate warning, a warning which “[brought] home the real risks associated with the inhalation of asbestos dust” (at [33]) or “[brought] to attention the serious risks associated with the use of the product” (at [36]). The precision with which the reasonable response must be found will depend on the circumstances. The judge did not state the reasonable response by a particular form or wording of a warning. That would have been an unprofitable task, since a warning could have been given in any of a great many forms and wordings, and in my opinion the judge was entitled to express the reasonable response, as had King CJ, in terms of an adequate warning and then to find whether or not an adequate warning had been given.
The judge did not tabulate “considerations of the nature of those indicated in Wyong Shire Council”. In the course of his reasons he found that the risk was serious, and the appellant was already providing warnings by the stickers and in the brochures. There was realistically no occasion for more than assessment of the strength of the warnings against the seriousness of the risk. I do not think that there was error in point of law akin to the error of law to which Gummow and Hayne JJ referred.
In so concluding I do not overlook the appellant’s further reliance on McPherson’s Ltd v Eaton. The trial judge in that case had found that a retailer should have warned of the dangers of asbestos products of which it knew or ought to have known. Ipp JA, with whom Mason P agreed and Hodgson JA “substantially” agreed, said at [145] that there was error of law in that there was “no considered evaluation” as required by Wyong Shire Council v Shirt. Hodgson JA’s additional reasons included -
“29 In my opinion, the primary judge also erred in law in not addressing the question of what form a warning might have taken, and the question of the balance between the efficacy of such a possible warning and the difficulty and expense of implementing it, so as to be able to reach a conclusion as to whether the absence of such a warning showed unreasonable conduct by the appellant.”
McPherson’s Ltd v Eaton was a very different case from the present case. The question was whether a retailer who did not know of risk to users of the products it sold owed a duty of care to users in relation to the products. It was held that it did not unless there was “something more” (at [1] per Mason P, [20] per Hodgson JA, [82] per Ipp JA), and specifically by Mason P at [1] that it did not owe the same duty of care as a manufacturer. Ipp JA nonetheless went on to consider the trial judge’s answer to whether the retailer had carried out the duty as the trial judge had stated it. (His Honour did so under the heading “The scope or content of the duty”; with respect, he appears to me to have slipped in paragraphs [128]-[147] under that heading from content of the duty of care to the reasonable response to the risk of injury). A careful evaluation was particularly required in the case of a retailer providing warnings, especially when the retailer’s duty of care as stated by the trial judge involved what it ought to know. The retailer sold a myriad of products, and at any given time had several thousand different hardware products on sale. It relied on manufacturers for information on risks in the use of products. How it could assess the extent of risk, how it could put itself in a position to warn, how it could warn, the form and wording of a great number of warnings, and balancing cost to the retailer and effectiveness of warnings were very real matters. The evaluation in the present case did not have similar complexity.
Causation
The judge held that the appellant did not owe to Mr Lorizio any duty of care in relation to the old fibro encountered in demolition or renovation/extension work. That holding was not in issue on appeal. He also found that, despite exposure to asbestos dust and fibre from the old fibro, there was causation of Mr Lorizio’s mesothelioma from his exposure to the asbestos dust and fibre from the products. That finding also was not in issue on the appeal.
The question on appeal was the connection between failure to warn and Mr Lorizio’s condition. The appellant submitted that stronger warnings, meeting the judge’s requirement of adequacy to bring home the real risks, would not have made any difference. Mr Restuccia had seen the stickers, but had not paid attention to them, and in the appellant’s submission was likely similarly to have been unmindful of stickers or brochures with stronger warnings. Mr Lorizio made no mention of the stickers or brochures, and the appellant submitted that, it should be taken that he paid no attention to them and equally would not have paid attention to them if they had contained stronger warnings. Thus, it was said, even if there had been stronger warnings Mr Lorizio’s exposure during his employment by the respondent would have been the same, and the deficiency in warnings found against the appellant did not cause or contribute to his contraction of mesothelioma.
The judge did not make an express finding as to causation in this respect, as distinct from causation despite the exposure to asbestos dust and fibre from the old fibro. Causation was implicit in his holding that the appellant would if sued have been liable to Mr Lorizio.
The respondent submitted that it was not open to the appellant to challenge the causal connection because, as was acknowledged by the appellant, it had not challenged it at the trial. The appellant had not submitted to the judge that causation was absent because no attention would have been paid to stronger warnings. It submitted in this Court that it did not have to, and that it was for the respondent to prove by evidence and to satisfy the judge in submissions that the breach of duty caused loss to Mr Lorizio. However, trials are not conducted in a vacuum, and their dispute resolution is conducted in a real world. I do not think the appellant’s submission properly recognised the circumstances of the trial.
The respondent gave an opening, explaining its case to the judge. The judge asked the appellant “what [it] sees as the issues”. Three issues were described. The first two went to duty of care and breach of duty. The third was described by the question, “Did any breach of duty by [the appellant] cause Mr Lorizio’s mesothelioma?”, and was explained as involving “the different kinds of inhalation” (meaning the dust and fibres inhaled from the old fibro, with mention also of Wunderlich products). The causation in question on appeal was not mentioned. Neither party asked questions of Mr Restuccia about what might have happened if different warnings had been given. The appellant put submissions on causation involving the different kinds of inhalation, but not on the causation presently in question.
It may be that a party could not be dissatisfied in point of law, even if there were a point of law, if a matter which it did not raise as an issue went against it. Any dissatisfaction would be with the failure to raise the matter. However, that Mr Lorizio’s exposure would have been materially less if adequate warnings had been given was a non-issue, and was implicitly conceded by the appellant. If it did not intend the concession, its conduct of the proceedings was such that the challenge to causation should not be permitted.
In any event, there was material on which the judge could find causation, and there was no error of law in his implicit finding of causation.
Mr Restuccia did recall reading stickers, although not words about keeping dust down. However, he was not reckless of risks in the respondent’s building work. When he was taken in cross-examination to a brochure about Villaboard, he said that he knew how to install fibro -
“So that to me that was also irrelevant, unless I would see – if – written, danger, or something, you know, like a warning. Then I would stop it and say, what’s that. … If I seen on somewhere a sign of danger, then well, I just sat back and say, what’s going on here. Like I did when soon after I heard from the supplier, he said, they took this away because is danger.”
When he heard from the supplier was when he was told that asbestos had been taken out of the products and was dangerous. He said, in relation to recalling reading stickers -
“ … I think on the beginning, because when he says something I use new, well, to me a long time ago, say this face down, or whatever, the other written down, but it don’t look written ….. which to me, when you want to warn someone you’ve got to emphasis, focus, that’s why I’m a bit – you know, I – no, sorry, no, that’s beside the point, because if there’s something you want to make understand, we’re builders, we’re not solicitors or barristers, we dumb. Sorry, I’m talking for me myself, not for the other – we want to see things there on our face.”
Mr Restuccia’s credibility can survive his questionable comparison with barristers and solicitors, and this was evidence which the judge could accept and on which he could find that stronger warnings would have come to Mr Restuccia’s notice and brought a change in work practices.
I have noted that Mr Lorizio said in his affidavit that if he had known of any health risks associated with the use of asbestos cement building materials, he “would not have worked with or near such fibro materials”. Such a definite assertion would have to be doubted; it is not particularly likely that Mr Lorizio would have left the building trade. A person’s evidence of what that person would have done if given advice or a warning will often need to be assessed with circumspection, and findings can and often should preferably be made with regard to the probabilities and from other evidence. Nonetheless, even a person in his late teens could be expected to take note of a strong warning, and Mr Lorizio would no doubt have followed changed work practices imposed by Mr Restuccia.
It was open, in my view, for the judge to find on the evidence and with regard to the probabilities that stronger warnings would have attracted the attention of Mr Restuccia or Mr Lorizio or both, and that Mr Lorizio’s exposure during his employment by the respondent would have been materially less.
The appellant’s submissions included that whether a person would have acted differently if given advice or warned depended on the advice or warning, and that the judge could not find that Mr Restuccia or Mr Lorizio would have acted differently if adequate warnings had been given without a more precise finding of what the adequate warnings would have been.
Again, that was not an issue at the trial. In my opinion it is open to a tribunal of fact to find that a warning described no more precisely than a warning which would bring home to its recipient the risks in the use of a product would on the probabilities have caused the recipient to take heed of it. As I have said, the warnings in the present case could have been in many forms and wordings. A precise form and wording could be proposed, as was done by McHugh J in Woods v Multisport Holdings Pty Ltd at [80], but it would not be realistic to tie the parties to the one form and wording or to a high degree of precision. Adequacy is a well understandable concept, albeit flexible, and sufficiency to bring home the seriousness of risks can be comprehended without a particular form and wording. A jury could be directed in terms of adequacy: it would be open to the jury then to find breach and causation. I do not think there was error of law in causation without a more precise finding of what the adequate warnings would have been.
Contribution
The appellant acknowledged that the determination of the amount of contribution recoverable from a person as “just and equitable having regard to the extent of that person’s responsibility for the damage” (Law Reform (Miscellaneous Provisions) Act 1946, s 5(2)) was akin to a discretionary decision, and was not readily overturned on appeal. It submitted that appellate review was available where legal error was disclosed, that legal error could be inferred from an unreasonable apportionment; and that the apportionment of responsibility in the present case was unreasonable.
The judge stated “factors” going to the respective responsibilities of the appellant and the respondent, observed that it was “very much a matter of impression”, and concluded that the apportionment of responsibility should be equal as between them. The appellant’s submission was made with proper diffidence, and I intend no disrespect in saying without elaboration that the apportionment was well within the assessment of what was just and equitable open to the judge. No error of law is revealed.
Orders
In my opinion, the appeal should be dismissed with costs.
IPP JA: I have had the benefit of reading the draft reasons of Giles JA. I agree with his Honour’s statement of the relevant facts, which I gratefully adopt. I also agree with the orders his Honour proposes.
A duty to take reasonable care is not owed, without limit, to the world at large. The duty must be contained within boundaries. The boundaries are encompassed in the concept of “scope” or “content” of the duty. Even what is often described as a “generalised” duty is confined in some way. For example, the generalised duty owed by an occupier of land is to take reasonable care for the safety of those who enter the land (Neindorf v Junkovic (2005) 80 ALJR 341). The duty owed by motorists is to take reasonable care for the safety of other users of the highway having regard to all the circumstances of the case (Vairy v Wyong Shire Council (2005) 223 CLR 422 at 432, [26] per McHugh J). In some categories of case the relevant duty is described with greater precision, and the limits are more closely defined. See, in this regard, Mason P’s comments in McPherson’s Ltd v Eaton (2005) 65 NSWLR 187 (at 190 to 191) where his Honour referred to the general discussion in Sullivan vMoody (2001) 207 CLR 562 (at 579 to 580, [50]), Modbury Triangle ShoppingCentre Pty Limited v Anzil (2000) 205 CLR 254 (at 288 to 290, [99] to [105] per Hayne J) and Jones v Bartlett (2000) 205 CLR 166.
It is not necessary, however, to embark on any analysis of this question as this case is concerned with the duty of care of a manufacturer, the scope or content of which has been settled since the modern law of negligence was created by Donoghue v Stevenson [1932] AC 562. There the majority held that a manufacturer owes a duty to consumers to take reasonable care in the manufacturing process. No one since has shown any inclination to depart from what Lord Atkin said in this regard. His Lordship’s articulation of the manufacturer’s duty of care has been adopted, in substance, in cases of the highest authority, for example, Grant v AustralianKnitting Mills Limited (1933) 50 CLR 387 (HC); (1935) 54 CLR 49 (PC), Norton Australia Pty Limited v Streets Ice Cream Pty Limited (1968) 120 CLR 635, Vairy v Wyong Shire Council (2005) 223 CLR 422 (at 443, [63] per Gummow J) and Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 (at 585, [106] per McHugh J).
Often, where a generalised duty of care is owed, and the critical question in the case is not the existence of the duty but whether, in the discharge of that duty a warning should have been given, the discourse contains references to a “duty to warn”. This use of language is inaccurate but is often deployed to focus on the fundamental question to be decided in the case. Familiar examples are, “a duty to keep a proper lookout”, “a duty to drive at a safe speed”, or “a duty to construct a fence (or some other kind of protective barrier)”.
Although the usage elides duty, content and breach, it usually does not give rise to problems in the decision making process as its purpose is well understood.
From time-to-time, attention has been drawn to the way in which, in some cases, issues of duty, content and breach (and even causation and damage) can merge, making it artificial and inappropriate to draw distinctions between them. But when the competency of an appeal depends upon whether the grounds of appeal involve questions of law, it may become necessary for appellate courts to distinguish between these concepts. In such cases, difficulties may arise when a trial judge, for example, has spoken of a duty to warn when the judge, in reality, intends to refer to a warning to be given in the discharge of a more generalised duty of care.
As Giles JA points out (at [59]), the trial judge in this case “stated a duty of care as a duty to give adequate warning of the risks of asbestos, then asked whether the warnings given were sufficient and found that they were not”. At trial, the appellant did not dispute that it owed a generalised duty of care to users of the products it manufactured. The critical issue at trial was whether that duty of care required the appellant to warn users of the risks of the asbestos.
In addressing this issue the trial judge adopted the approach of King CJ in Anderson v Corporation of the City of Enfield (1983) 34 SASR 472 (at 476):
“The manufacturer and distributor of an inherently dangerous product owes a duty to give adequate warning to people into whose hands the product may come, of the dangerous qualities of the product.”
This is a typical example of a “duty to warn” type of expression being used in order to focus upon the crucial issue in the case, namely, the giving of a warning. In the present case, by reason of the appellant’s acceptance that it owed a generalised duty of care, there was practical purpose in describing the question in terms that directed attention to whether, in discharge of that duty, a warning should be given.
I agree with Giles JA that, while his Honour did not correctly express the duty of care, the way in which he formulated the issue for decision does not justify appellate intervention. I do not think that the incorrect formulation of the duty of care gave rise to any material error in the decision-making process.
The appellant contended that the trial judge’s findings in regard to the appellant’s knowledge of the risk of asbestos were erroneous. The appellant contended further that those findings affected the content of the appellant’s duty of care (to the extent that the content governed the need to give a warning) and, for that reason, those erroneous findings constituted errors of law. The appellant sought to rely on McPherson’s Ltd v Eaton in this respect.
In McPherson’s v Eaton, this Court held that the trial judge made two errors of law in finding that the retailer, McPherson’s, knew or ought to have known of the relevant dangers of asbestos. Both these errors concerned the method the trial judge used in finding the existence of knowledge on the part of McPherson’s. The errors relied on were not the actual findings that the judge made, (although, in some instances, those findings – in the particular circumstances – supported an inference that an incorrect method had been used). It was not contended in McPherson’s v Eaton, and nor could it have been, that mere error in factual finding constituted an error of law.
The first error of law that this Court held had been made concerned the application of the appropriate test in determining that McPherson’s should have known of the particular dangers of asbestos (see at 209, [127]). The Court held, following Dovuro Pty Limited v Wilkins (2003) 215 CLR 317, that the appropriate test was that of a reasonable retailer in the position of McPherson’s (see at 204, [96]). The judge had not applied that test.
The second error of law was that:
“[H]is Honour considered that McPherson’s was duty bound to research or investigate the possibility of [asbestos-related] dangers. … [S]uch an approach – at the duty stage – [was] an error of law.”
(See at 208, [118]).
Thus, the errors as to the findings of knowledge in McPherson’s v Eaton were not held to be errors of law merely because they concerned the content of the duty of care. They were held to be errors because the trial judge applied the incorrect test in approaching the factual question in issue and wrongly assumed that McPherson’s owed the plaintiff a duty of care in finding that it ought to have known of the dangers of asbestos.
The appellant in the present case did not contend that errors of this kind had been made. The errors asserted were, essentially, errors allegedly made in the actual conclusions to which his Honour came. In my view, the reliance on McPherson’s Ltd v Eaton in this regard was misplaced.
I agree with Giles JA that the appellant’s argument that the trial judge did not undertake an appropriate evaluation of all relevant factors in accordance with Wyong Shire Council v Shirt (1979) 146 CLR 40 should fail. I accept, as his Honour says (at [72]), that for the purposes of the Shirt inquiry, in the circumstances of the case:
“There was realistically no occasion for more than assessment of the strength of the warnings against the seriousness of the risk.”
I agree with what Giles JA has written concerning the “proper inquiry as to breach”. In the circumstances of this case, for the reasons set out particularly in [71], [72] and [74] of Giles JA’s judgment, I accept that, in determining breach, it was sufficient for the judge to find that an adequate warning of the risks of asbestos should have been given, without specifying the precise warning and without having regard to factors other than those that he, in fact, took into account.
In some circumstances, it may not be necessary to address the form that a warning should have taken. The risk may be so easy to understand and so dangerous that a conclusion as to unreasonable conduct on the part of the defendant (in not giving the warning) may be arrived at without making a finding as to the precise nature of the warning. For example, in Nagle v Rottnest Island Authority (1993) 177 CLR 423, Mason CJ, Deane, Dawson and Gaudron JJ said (at 431 to 432):
“True it is that the particulars might have been more specific by stating the form of notice, for example, ‘Diving from anywhere in this area is prohibited’, with or without a reference to the presence of dangerous rocks and by identifying the place or places where the notice might be located. But the particulars sufficiently drew to the respondent’s attention the relevant omission which constituted the alleged negligence, that is, the failure to warn of the danger of diving at the place where the accident occurred. A notice prohibiting diving is but one form of notice – perhaps the most effective form of notice – warning of the danger of diving.”
Rogers v Whitaker (1992) 175 CLR 479 is another case where the terms of the warning and how it should have been given were simple, and required little in the way of a Shirt evaluation. In that case, the High Court held merely that the respondent should have been warned of the risk of damage by sympathetic ophthalmia to her good eye.
There are, however, cases where the terms of the postulated warning have been significant and findings as to those terms, as well as a detailed Shirt evaluation, have been held to have been necessary: see, for example, Great Lakes Shire Council v Dederer (2006) Aust Torts Reports 81 - 860; [2006] NSWCA 101 and McPherson’s v Eaton, itself.
In the present case, the issues as to breach were relatively simple and straightforward. They required no greater evaluation than the judge undertook. As Giles JA points out, the issues in McPherson’s v Eaton were far more complex (see at [74]) and required a substantially more complex evaluation. In particular, in McPherson’s v Eaton there were practical difficulties and questions of expense involved in giving warnings. In the present case, it was not suggested, at trial, that similar problems arose. McPherson’s v Eaton is distinguishable in regard to this issue.
I accept Giles JA’s chastisement arising out of the fact that in McPherson’s v Eaton, under the heading “The scope or content of the duty” (at 210), I discussed questions of breach of duty as well as scope or content. If I may say so, I think the fault is in the heading (which wrongly indicates that the discussion that follows is confined to scope or content of duty). In fact, what follows under the heading is a statement of my reasons (dealing with breach as well as content) for holding that the errors of law identified at 212 to 213, [145] to [148] were made.
My agreement with Giles JA that the judge did not err in finding that the appellant breached its duty of care (in failing to carry out a more detailed evaluation process) should not be taken to be an agreement on my part that, for the purposes of determining causation, it was not necessary for the judge to make detailed findings as to the warnings that should have been given.
Causation does not appear to have been an issue at trial. In Nagle v Rottnest Island Authority, Mason CJ, Deane, Dawson and Gaudron JJ (at 432) regarded the defendant’s omission at trial to rely on the plaintiff’s failure to “identify the precise content of what would have been an adequate warning sign” as “significant”. The appellant’s omission, in the present case, to raise the issue of causation at trial is, likewise, significant.
The appellant did not, at trial, advance any contentions based on the insufficiency of the wording of the warnings. Mr Lorizio stated, in his affidavit, that he would not have worked with, or near, asbestos cement building materials had he known of the risks associated with that work. Mr Restuccia said that if he seen a “sign of danger” he would have “just sat back and stop[ped]”. The appellant did not suggest to Mr Restuccia that he would not have reacted in the same way had he read about the potential danger of asbestos in warnings on the appellant’s products. The evidence of Mr Lorizio or Mr Restuccia established a prima facie case of causation that was not challenged at trial. The appellant did not invite the trial judge to reject their evidence on this issue and did not submit to his Honour that it had not been proved that the absence of an adequate warning caused the relevant loss.
In the circumstances, I agree with Giles JA that the appellant’s causation challenge should not be permitted.
I do, however, wish to comment on the proposition that there was material on which, in any event, the judge could have found causation.
In my reasons in McPherson’s v Eaton, I pointed out (at 211, [136]) that the judge in that case “did not identify what warning should have been given, how it should have been given and to whom it should have been given”. Allied to these observations was my finding (at 212 to 213, [147]) that:
“[T]he judge failed to identify, with appropriate precision, what a reasonable person in the position of McPherson’s would do by way of response to the reasonably foreseeable risk and thereby committed an error of law.”
In some circumstances, for the purposes of finding causation, it may not be necessary to address the precise form that a warning should have taken. But, in my view, in this case it was necessary to do so.
Mr Restuccia did not read the warnings on the stickers to which Giles JA has referred. He paid no attention to them. When it was put to him that he did not “care to read” the warnings, because he was in a hurry, he said “maybe, but they didn’t put there, tell people, look”.
Thus, Mr Restuccia ignored the previous warnings. A change in the wording of the warnings would have been useless unless he would have read them.
The attitude of Mr Lorizio (who did not testify orally) to warnings was not clear.
There was, therefore, a real question as to the appropriate form of the warning and whether such a warning would have attracted the attention of Mr Restuccia and Mr Lorizio sufficiently to result in them reading and responding to it. The respondent had to prove, and the judge needed to find, what steps should reasonably have been taken by the appellant that would have probably caused Mr Restuccia and Mr Lorizio to read the postulated new warning. The respondent also had to prove, and the judge needed to find, that Mr Restuccia and Mr Lorizio would have responded to the postulated warnings. It is sufficient to say that the judge made no such findings.
The reason that I would dismiss the appellants’ argument as to causation is because it was not properly raised at trial, not because it otherwise does not have merit.
As regards the question of contribution I agree with Giles JA.
Accordingly, I agree with Giles JA that the appeal should be dismissed with costs.
BASTEN JA: I agree with Giles JA that the appeal in this matter should be dismissed with costs.
The approach to this appeal set out below derives from three principles. First, because the appeal is competent only to the extent it raises “points of law”, it is necessary to distinguish possible errors in point of law from erroneous factual findings. Secondly, identifying questions as to the duty of care as questions of law ignores the possibility that the correct identification of the duty will involve, in part, factual findings. Thirdly, on any view there is no bright-line boundary separating questions going to duty, breach or causation. Accordingly, the Court’s focus should be on grounds identifying questions of law in conventional terms.
The starting point for the consideration of the grounds raised by the Appellant is s 32 of the Dust Diseases Tribunal Act 1989 (NSW), which relevantly provides:
“32 Right of appeal to Supreme Court
(1)A party who is dissatisfied with a decision of the Tribunal in point of law or on a question as to the admission or rejection of evidence may appeal to the Supreme Court.”
As Giles JA notes at [25], I discussed the nature of the dissatisfaction which must be demonstrated to obtain relief under this section in Seltsam Pty Ltd v Ghaleb [2005] NSWCA 208 at [148]-[156]. In that case a question arose as to whether procedural steps taken in the Tribunal demonstrated unfairness, so that a relevant ground of review was established. Consideration was also given, at [161]-[168], to what further steps could be taken in this Court in determining issues, once a relevant error was established.
Although the provision is likely to be of greater relevance in relation to the scope of review for procedural unfairness, it may also be noted that the Dust Diseases Tribunal Act provides in s 13:
“13 Proceedings before the Tribunal
…
(5) A decision of the Tribunal is not liable:
(a)to be vitiated because of any informality or want of form, or
(b)to be questioned or appealed against in any court,
except as provided by section 32 of this Act or section 48 of the Supreme Court Act 1970.”
Relevantly for present purposes, s 48(2) assigns to this Court proceedings in the nature of judicial review under s 69 of the Supreme Court Act and appeals from Tribunals, including the Dust Diseases Tribunal. Although complaint was made as to aspects of the reasoning in the Tribunal, which may form part of the “decision” – see Commissioner of Corrective Services v Walker [2007] NSWCA 213 at [29] – no reference was made in argument to this provision.
The authorities referred to in Seltsam suggest that a decision may be challenged in point of law in the following circumstances, where the judge has:
(a)misapprehended the relevant legal principles to be applied;
(b)made a finding as to primary facts which was unsupported by any evidence or other material on which reliance might properly be placed;
(c)in the application of correctly stated principles, drawn an inference from the facts which was not reasonably available in the circumstances, or
(d)failed to address an issue which is raised by the agreed or established facts.
In relation to claims in negligence, broadly stated, the proper identification of a duty of care is a question of law, whereas questions of breach and causation are questions of fact. Applying that approach, it might be thought that the only ground of appeal available, as pleaded was the first ground, which alleged that the trial judge incorrectly formulated the content of the duty of care owed by the Appellant to the employee of the Respondent: see [26] above. As other members of the Court have explained, that gives rise to a question as to the level of particularity or generality at which, as a matter of law, a duty of care should be identified.
Before considering that matter, two other points may be briefly noted. First, there was no obligation on the trial judge to deal separately with questions of law and questions of fact in an accurate and precise manner. He was the judge of both and, if he defined the duty of care at a level of particularity which tended to confuse duty with questions of breach, that will not affect what constitutes a question of law. Nor would it involve a material error on the part of the trial judge. Secondly, a duty is not to be identified purely as a matter of law. As explained by Gleeson CJ in Swain v Waverley Municipal Council (2005) 220 CLR 517 at [4], “the alleged duty of care might depend upon contested facts”: see further the discussion in Skulander v Willoughby City Council [2007] NSWCA 116 at [87]-[88], a judgment in which Beazley JA concurred.
The phrase “duty of care” has little content when abstracted from particular circumstances. It only has meaning when one knows whether the parties are parent and child, occupier of land and lawful entrant, or driver of a car and other road user. The content or extent of the duty is properly identified by reference to the harm which befell the particular worker and his relationship with the Appellant, being the manufacturer of the product: see Gleeson CJ in Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254 at [17]-[18] and other authorities to the same effect identified by Beazley JA in Shellharbour City Council v Rigby [2006] NSWCA 308; (2006) 150 LGERA 11, at [32]-[37] and by me at [295]-[296] (Ipp JA agreeing with both passages). Identification of the duty provides the test against which the conduct of the defendant must be judged.
If the duty of care is defined at a high level of generality, no question of law arose in this case. That a manufacturer of goods owes a duty to its consumers derives from no less an authority than Donoghue v Stevenson [1932] AC 562 at 595 and 599. That duty extends to taking reasonable care to avoid the occurrence of the kind of harm suffered by the plaintiff. In the particular circumstances of a case, that principle will give rise to a number of factual questions, namely:
(a)was the defendant the manufacturer of the goods said to have caused harm to the plaintiff;
(b)did the defendant know, or should it reasonably have known, of the risk of harm, and
(c)what steps would a reasonable manufacturer have taken to avoid such harm?
There will be further factual questions going to breach and causation.
On this approach, the duty may be seen to be identified at different levels of generality and particularity. The question at the general level is one of law: at the level of particularity found in paragraph (c) above, identification of the appropriate standard gives rise to a question of fact. No doubt if the standard is fixed with a high degree of particularity, the question of breach, which will focus on the specific conduct (whether by act or omission) of the defendant, may fall within a narrow compass. However, in determining whether there is a question of law at stake, it is more helpful to define questions of legal principle which may be distinguished from questions of fact, rather than adopt a labelling exercising by reference to the overlapping categories of duty, breach and causation.
The appropriateness of approaching the matter in this way is confirmed by the expectation, more important in some cases than in others, that the Court will identify the steps which must be taken to satisfy the duty. If the appropriate step is the giving of a warning, in some cases the content and presentation of the warning may need to be identified to establish the appropriate standard. In relation to road users, a driver may properly be said to be under a duty to comply with the rules of the road, not exceed an appropriate speed and keep a proper lookout. Legal discourse commonly adopts this language of duty and it is not self-evidently misguided or wrong to do so.
In McPherson’s Ltd v Eaton (2005) 65 NSWLR 187, this Court upheld an appeal from the Dust Diseases Tribunal on the basis that the retailer did not owe the kind of duty owed by a manufacturer to a consumer. It also held that the law did not impose on the retailer a duty to inquire as to the potential risk of harm from use of products which it sold. These conclusions both involved questions of law. As in the present case, the appeal was confined to dissatisfaction with a decision in point of law and accordingly the case did not raise, nor should it be understood to address, questions of fact which were in any event foreclosed by the answers given by the Court on the anterior legal questions.
As noted above, in this case the existence of a relevant duty of care was not disputed at the level of generality. To the extent that the Appellant’s submissions raised factual questions, there was evidence capable of supporting the findings of the trial judge as to each element of the cause of action. Nor could it properly be said that inferences in relation to the form and content of an appropriate warning were not reasonably capable of being drawn. The warnings given were capable of being described as “anodyne” and as inadequate for their purpose. No more precise finding was necessary as a matter of law.
I do not disagree with anything said by Giles JA as to the facts of the case, but I am not persuaded that the Appellant properly identified in the grounds of appeal, or in its submissions, any legal error which required a close analysis of the facts. The appeal might properly be dismissed on that basis. It is not necessary for this Court to assist an appellant by a process akin to alchemy, of seeking to create a question of law from the grounds and submissions relating to the facts: see Aronson and Dyer, Judicial Review of Administrative Action (2nd ed, 2000) at p 205 “Exercises in alchemy, or how to turn factual errors into errors of law”, evocative language which has been abandoned in the third edition.
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