and a Woodley Osteopathic Services Pty Ltd v Transport Accident Commission andBRENDAN Woodley , , Brendan Woodley and Transport Accident Commission and a Woodley Osteopathic Services Pty Ltd
[2013] VSCA 350
•6 December 2013
SUPREME COURT OF VICTORIA
COURT OF APPEAL
| S APCI 2012 0037 | |
| A WOODLEY OSTEOPATHIC SERVICES PTY LTD | Appellant |
| v | |
| TRANSPORT ACCIDENT COMMISSION and BRENDAN WOODLEY | First Respondent Second Respondent |
| S APCI 2012 0040 | |
| BRENDAN WOODLEY | Appellant |
| v | |
| TRANSPORT ACCIDENT COMMISSION and A WOODLEY OSTEOPATHIC SERVICES PTY LTD | First Respondent Second Respondent |
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| JUDGES | MAXWELL P, TATE and PRIEST JJA |
| WHERE HELD | MELBOURNE |
| DATE OF HEARING | 28 May 2013 |
| DATE OF JUDGMENT | 6 December 2013 |
| MEDIUM NEUTRAL CITATION | [2013] VSCA 350 |
| JUDGMENT APPEALED FROM | Transport Accident Commission v A Woodley Osteopathic Services Pty Ltd (Unreported, County Court of Victoria, Judge Howie, 22 February 2012) |
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TORT – Duty of care – Breach of duty – Occupier of land adjoining highway – Horse agisted on land – Paddock gate left open – Farm gate open – Horse escaped – Collision between horse and vehicle on highway – One passenger killed, one passenger injured – Duty of care of occupier to highway users to prevent horse escaping – Content of duty of care – Whether occupier obliged to ensure farm gate closed at all times – Nature and extent of risk of escape of horse – No breach of duty – AD & SM McLean Pty Ltd v Meech (2005) 13 VR 241 applied.
TORT – Duty of care – Breach of duty – Tenant of house on land adjoining highway – Horse agisted on neighbouring land – Paddock gate left open – Farm gate open – Horse escaped – Collision between horse and vehicle on highway – One passenger killed, one passenger injured – Whether tenant owes duty of care to highway users to prevent horse escaping – Whether tenant obliged to ensure farm gate closed at all times – Tenant not in control of horse or land – No duty of care.
ACCIDENT COMPENSATION – Transport accident – Horse agisted on land – Paddock gate left open – Farm gate open – Horse escaped – Collision between horse and vehicle on highway – Death and injury – Compensation paid to dependants of deceased passenger – Compensation paid to injured passenger by statutory insurer – Statutory insurer seeking indemnity from third parties – Whether occupier of land would have been liable in respect of loss – Whether tenant of house on land would have been liable in respect of loss – Appeal allowed – Indemnity proceeding dismissed – Transport Accident Act 1986 (Vic) s 104.
DAMAGES – Assessment – Loss of benefit of domestic services – Remarriage of widower of deceased passenger – Whether fact of remarriage to be taken into account in loss calculation – Reduction prohibited by law – Wrongs Act 1958 (Vic) s 19(2).
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| Appearances: | Counsel | Solicitors |
| For A Woodley Osteopathic Services Pty Ltd | Mr Jeremy Ruskin QC and Mr K G Howden | Lander & Rogers |
| For Brendan Woodley | Mr S R Horgan SC and Mr B J Murphy | DLA Piper |
| For the Transport Accident Commission | Mr S A O’Meara SC and Mr S E Gladman | Wisewould Mahony |
MAXWELL P:
Summary
On 25 August 2006, a chestnut mare escaped from a paddock on a Kilmore property (‘the property’), because the paddock gate was open. The mare then went through the farm gate, onto the Northern Highway (‘the highway’). A car driven by Dale Burnett was travelling along the highway and collided with the horse. His wife, Leanne, was killed and his daughter, Jaime, was injured.
The Transport Accident Commission (‘the Commission’) paid compensation in respect of the death and the injury, in accordance with the provisions of the Transport Accident Act 1986 (Vic). The Commission in turn commenced indemnity proceedings under s 104 of that Act against the appellant company, which was the owner and occupier of the property (‘the company’), and the second respondent (‘Brendan’), who was the lessee and occupier of a house on the property.
The Commission sought indemnity in respect of payments it had made, and payments which it might in future make, to Jaime in respect of her injury and to Dale Burnett on behalf of the dependants of Leanne Burnett. The trial judge upheld the Commission’s claim, and gave judgment:
(a) against the company, in an amount of approximately $380,000 (including interest); and
(b) against Brendan, in an amount of approximately $42,000 (including interest).
In addition, the company was ordered to indemnify the Commission to the extent of 90 per cent of any payment it might subsequently make, and Brendan was ordered to indemnify the Commission to the extent of 10 per cent of any such future payment.
The company and Brendan have instituted separate appeals from that judgment. The appeals were heard together. The company accepts that it owed a duty to take reasonable care to avoid the risk of injury to users of the highway resulting from the escape of the horse. Its principal appeal contention, however, is that the judge erred in finding that the company had breached its duty. In his appeal, Brendan contends that the judge erred in holding that he owed any duty of care to users of the highway; alternatively, that his Honour erred in finding that he breached his duty.
For reasons set out in Part 1 of this judgment, I would allow both appeals. In my opinion, there was no breach of duty by the company, and Brendan owed no duty of care to road users in respect of any risk associated with the horse.
Both appeals also raised questions, in the alternative, about apportionment of liability and about quantum. In view of my conclusion that neither appellant was liable to indemnify the Commission, it is not strictly necessary to address those questions. In case the proceeding should go further, however, I have dealt with those grounds of appeal in Part 2 of this judgment.
PART 1: LIABILITY
Factual background[1]
[1]Paragraphs [7]–[14] below are taken from the Summary of Proceedings and Issues prepared by the parties.
The company was the registered proprietor of the property, which adjoins the Northern Highway near Kilmore. The company’s directors were Allan Woodley and his wife Natalie. Brendan is their son. The property was divided into several tenancies which were the subject of varied uses. A driveway led 70 to 80 metres eastwards from the highway, to a house occupied by Brendan, his wife and young children. Brendan had lived there since 1997.
There were two family partnerships, which grew shiraz and pinot noir grapes respectively on different areas of the property. To the south of the driveway was the area planted with shiraz grapes, managed by one partnership. To the north of the driveway, between the highway and the house, was the paddock. Further north again was the area planted with pinot noir grapes, managed by the second partnership. Both partnerships paid rent to the company for the occupation of their respective plantings. Brendan paid rent to the company for his occupation of the house. Brendan worked on both the shiraz and pinot noir plantings as viticulturist.
At the western end of the driveway, that is, at the property’s boundary, was a front gate which was always left open. This gate was capable of being shut and secured. The paddock had post and wire fencing in sound condition. Towards the eastern end of the driveway, 25 to 30 metres from the house, the wrought iron paddock gate opened onto the driveway. It was secured by a chain and plate which passed over a pin.
The chestnut mare belonged to Allan Woodley. It was agisted in the paddock on the property from about January 2006. It did not leave the paddock until the day of the accident. Also kept in the paddock for about three months prior to the accident were four sheep belonging to Brendan’s father-in-law. The stock had feed available by way of baled lucerne hay, placed some 40 metres north of the paddock gate, as well as the grass growing there. Water was available from a dam and from a bath used as a water trough placed near the paddock gate.
A feed bin for the horse was hung on the paddock fence, two or three metres west of the paddock gate. Allan Woodley attended the property two or three times a week. He added feed to the bin from time to time when visiting the property, and Brendan had done so at Allan’s request on two or three occasions since the horse was agisted there.
Shortly after 6:00pm on Friday 25 August 2006, the Burnetts were travelling south along the Northern Highway in their car. They collided with the horse on the roadway near the entrance to the property. Dale Burnett was driving. There was no suggestion of negligence on his part. Leanne Burnett, who was a passenger in the front seat, was airlifted to hospital but died. Her daughter, Jaime, a passenger in the rear seat, was injured.
Allan Woodley had last been at the property the weekend before the accident. The evidence did not disclose whether on that occasion he had opened the paddock gate or entered the paddock. Brendan did not recall any specific occasion in 2006 when his father had entered the paddock. Brendan testified that he expected that his father had fed the horse on his recent visit, but he had not seen him do so.
Brendan testified that:
(a) the paddock was not part of the property under his control during his occupation;
(b) he last entered the paddock about two months prior to the accident, following a dog attack on one of the sheep;
(c) at the time of the accident the paddock gate could be secured by its plate and pin with relative ease and with the pin vertical. He had never been unable to secure it, nor had it come undone;
(d) to that time he had not observed others having difficulty securing the plate over the pin;
(e) at that time there was some slack in the chain;
(f) as at May 2007, the pin was vertical and the paddock gate could be secured with a similar degree of ease as at the time of the accident;
(g) the tension on the chain had, since the accident, increased after a large branch fell on the north-south line of fence which leads to the post on which the paddock gate is hung. In the week prior to his giving evidence, he had found it extremely difficult to secure the plate over the pin. Prior to this, tightness of the chain had not affected his ability to secure the plate over the pin;
(h) during his occupation, he passed the paddock gate almost daily;
(i) during his occupation he had never noticed the paddock gate unlatched or left open;
(j) when unlatched, the paddock gate could sometimes swing open under its own weight;
(k) there were multiple users of the driveway as at August 2006, including his wife, himself, other people who were leasing parts of the property, contractors and his father (several times a week);
(l) he did not think he could stop his father putting his horse in the paddock nor could he stop the use of the driveway by the multiple other users;
(m) from time to time various strangers entered various parts of the property, including the vineyards and paddocks, without permission;
(n) he saw the horse in the paddock whilst entering or leaving via the driveway several times during the morning of the accident but was absent from the property for most of the afternoon, returning at about 5:15pm or 5:30pm, returning from a neighbouring property to the south;
(o) he had no recollection of the paddock gate being open on the occasions he passed it during the morning of the accident. Had he seen it open, he would have closed it;
(p) he neither opened the paddock gate nor saw anyone else open it on the day of the accident;
(q) he did not have anybody else working on the property that day;
(r) his parents arrived at the property shortly after the accident; and
(s)
after his attendance at the accident scene, two of the sheep were confirmed to be in the property’s driveway. With his father and
wife’s help, he herded them back into the paddock through the paddock gate which was then standing open one or two metres.
The state of the paddock gate
The Commission’s case, as opened, was that the horse escaped through the paddock gate because of the defective condition and position of the gate’s latching mechanism. Although the pleading included particulars of negligence directed to the failure to ensure that the entrance gate was shut, senior counsel for the Commission did not assert in the opening that either the company or Brendan was at fault for having allowed the entrance gate to be open.
Instead, the submission concentrated exclusively on the paddock gate. The following exchange illustrates how the Commission defined the issue which the judge had to determine:
HIS HONOUR: So the issue is, as I understand what you’re saying, it is your case that the horse came through the [paddock] gate.
COUNSEL:Our case is that the horse came through - - -
HIS HONOUR: That the gate was open.
COUNSEL:Gate was open.
HIS HONOUR: Was open.
COUNSEL:Otherwise the sheep would not have been where they were on the night in question.
HIS HONOUR: If the gate is open, isn’t it then obvious as night follows day that somebody has been negligent?
COUNSEL:That is what we say, your Honour. It has either not been properly shut or was left open.
HIS HONOUR: Or it is an inadequate gate in some way.
COUNSEL:Or was an inadequate gate in the first place.
HIS HONOUR: As you put it to me, the issue really is who is liable for that?
COUNSEL:Yes. The owner of the property is the first defendant, that is a body corporate. The occupier was the second
defendant, he was living in the property and was managing the vineyard.
The significance of the entrance gate having been open was apparently raised for the first time by the judge himself, during final submissions, in these terms:
It’s reasonably foreseeable that if a horse gets out of the paddock, which is adjacent to a highway that carries traffic [with a front gate unlocked][2] it will cause injury or death. … So why isn’t it the responsibility of the occupier, one of whose directors owns the horse, to give instructions that the tenant of the house must make sure that both gates are shut to prevent that from happening?
[2]The transcript records the words in brackets as having been interjected by counsel for the Commission.
Even then, senior counsel for the Commission persisted with submissions directed at the deficiencies in the paddock gate:
[I]f the [paddock] gate was difficult or not easy to close, it increased the risk that anybody entering that with no sign and no instruction to anybody to see that it was closed, [it] would be left ill-attached. Having been left ill-attached, that would be the likely cause of it being open …
It was not necessary, counsel submitted, for his Honour to decide who had left the paddock gate open or whether this had resulted from the chain being attached inadequately or from its not having been attached at all. The evidence was:
overwhelming that the gate had to be open and the occupier had taken no steps in discharge of its non-delegable duty to ensure that that did not occur.
The Commission had led evidence about what were said to be deficiencies in the latching mechanism of the paddock gate. The judge’s findings of fact, which are not challenged, were that:
(a) placed properly, the latching mechanism effectively secured the closed gate;
(b) there were, nevertheless, shortcomings with the latching mechanism, in that:
(i) the chain was too short, making it difficult to correctly fit the plate over the pin; and
(ii) the pin was located inside the paddock, which created at least the possibility that the horse could have nudged the gate open by rubbing on it.[3]
[3]Transport Accident Commission v A Woodley Osteopathic Services Pty Ltd (Unreported, County Court of Victoria, Judge Howie, 22 February 2012) [24], [27]–[29] (‘Reasons’).
His Honour rejected the Commission’s primary claim, however. His key finding was as follows:
It is apparent that on 25 August 2006 the horse escaped from the paddock through the open paddock gate. It follows that the latching mechanism had not been securely applied to the gate. There is no evidence of who last used the gate before the horse escaped or when it was used. The possibility that a person did not secure the gate with the latching mechanism at all is equally probable with the possibility that a person applied the latching mechanism incompletely and the horse was able to move the plate off the pin. In those circumstances, I am unable to find on the balance of probability that the deficiencies in the latching mechanism were the cause of the horse escaping from the paddock.[4]
[4]Ibid [29].
The duty of care of the company as occupier
The company was right to concede that, in these circumstances, it owed a duty to highway users to take reasonable care to prevent the escape of the horse. That such a duty exists was confirmed by the decision of this Court in AD & SM McLean Pty Ltd v Meech.[5] The basis of the duty was explained by Nettle JA in an illuminating judgment (with which Chernov JA and Hollingworth AJA agreed). His Honour said:
Under those principles [of ordinary negligence], a person who takes advantage of his or her control of premises to carry on a ‘dangerous activity’, or to allow another to do so, owes a non-delegable duty of reasonable care to avoid a reasonably foreseeable risk of injury or damage to the person or property of another. What is more, for those purposes an activity is to be regarded as a ‘dangerous activity,’ even though it is not ‘inherently dangerous’ or dangerous in itself, if the combined effect of the magnitude of the foreseeable risk of an accident happening and the magnitude of the foreseeable potential injury or damage if an accident does occur is such that an ordinary
person acting reasonably would consider it necessary to exercise ‘special care’ or to take ‘special precautions’ in relation to it.[6]
[5](2005) 13 VR 241 (‘McLean’).
[6]Ibid 250 [21] (emphasis added).
Noting that the agistment of horses on rural land was not ‘inherently dangerous’, his Honour went on to explain why, in his view, an ordinary person acting reasonably would consider it necessary to exercise ‘special care’ or to take ‘special precautions’ in relation to the risk of a horse escaping:
On any analysis the agistment of horses on land abutting a major multi-lane highway … is likely to be dangerous for persons using the highway unless care is taken to confine the horses to the land. Further, as it appears to me, the magnitude of foreseeable risk of an accident happening and the magnitude of the foreseeable potential injury or damage in the event of a horse escaping onto the highway and causing an accident are such that an ordinary person acting reasonably would consider it necessary to exercise special care or to take special precautions to prevent the horses’ escape onto the highway. In those circumstances I consider that Burnie Port Authority[7] dictates that the occupier of land which abuts such a highway and who permits others to agist horses on the land may be held to owe to motorists passing on the highway by the property a non-delegable duty to take reasonable care to prevent the horses escaping onto the highway.[8]
[7]Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 (‘Burnie Port Authority’).
[8]McLean (2005) 13 VR 241, 250–1 [23] (citation added).
At trial, it seems, the company did not concede that it owed a duty of care, though it put no argument to the contrary. Applying the McLean analysis, the judge concluded as follows:
I am satisfied in this case that the location of the paddock in which the horse was placed adjacent to the Northern Highway meant that there was a real and substantial risk that if the horse escaped the property a serious accident involving a user of the highway would occur. In my judgment, an ordinary person acting reasonably would consider it necessary for the occupier of the land in those circumstances to exercise special care or take special precautions to prevent the escape of the horse on to the Northern Highway. I am satisfied that the first defendant as the occupier of the land owed a non-delegable duty to take reasonable care to prevent the escape of the horse from its property.[9]
[9]Reasons, [16].
The finding of breach by the company
As noted earlier, Allan Woodley, Brendan’s father, was the owner of the horse. He had put the horse on the property in January 2006, with the company’s permission. He visited the property variously in order to attend to the horse, to visit family and to work on the shiraz vines. The judge found that, as a director of the company which owned and occupied the land, Mr Woodley knew where the horse was located, the proximity of that location to the adjoining highway, the physical facilities of the property and the use made of it.
The judge made the following finding of breach:
The [company] gave no instruction to Brendan Woodley to keep the entrance gate closed or to direct other users of the driveway to keep the entrance gate closed, and placed no sign on the gate directing that it be closed. The gate was normally left open and was open on 25 August 2006. The horse escaped from the property through the open gateway.
I am satisfied that a reasonable person in the [company’s] position would have foreseen that a failure to keep both the paddock gate and the entrance gate securely closed involved a risk of the horse escaping from the property and causing serious injury or death to users of the highway. The degree of the probability of this occurring was real and not far-fetched or fanciful, and the magnitude of the risk was great. There was no significant expense and minimal difficulty or inconvenience in the [company] instructing its tenant to keep the entrance gate closed when there was stock on the property and to instruct him to direct other users of the driveway to keep the gate closed. Nor was there significant expense, difficulty or inconvenience in placing a sign at the entrance directing that the gate be closed and secured. As the tribunal of fact, I consider that a reasonable person would have taken these steps by way of response to the risks. The [company] failed to do so and was in breach of the duty it owed to users of the highway to take reasonable care to prevent the escape of the horse from its property. This breach was a cause of the accident.[10]
[10]Ibid [21]–[22].
As Nettle JA stated in McLean, the applicable standard of care in a case such as this, as in any other negligence case, is the standard of reasonable care.[11] His Honour set out the following passage from the majority judgment in Burnie Port Authority:
Where a duty of care arises under the ordinary law of negligence, the standard of care exacted is that which is reasonable in the circumstances. It has been emphasized in many cases that the degree of care under that standard necessarily varies with the risk involved and that the risk involved includes both the magnitude of the risk of an accident happening and the seriousness of the potential damage if an accident should occur. Even where a dangerous substance or a dangerous activity of a kind which might attract the rule in Rylands v Fletcher is involved, the standard of care remains ‘that which is reasonable in the circumstances, that which a reasonably prudent man would exercise in the circumstances’. In the case of such substances or activities, however, a reasonably prudent person would exercise a higher degree of care. Indeed, depending upon the magnitude of the danger, the standard of ‘reasonable care’ may involve ‘a degree of diligence so stringent as to amount practically to a guarantee of safety’.[12]
[11]McLean (2005) 13 VR 241, 254 [35].
[12]Burnie Port Authority (1994) 179 CLR 520, 554 (emphasis added, citations omitted).
As this passage makes clear, consideration of whether there has been a breach of duty — that is, a falling below the requisite standard of care — depends on the nature of the risk involved, and requires consideration of both:
(a) the magnitude of the risk of an accident happening; and
(b) the seriousness of the potential damage if it does.
Both these considerations must be addressed whenever a question arises regarding culpability for creating, or failing to avert, a foreseeable risk of harm.[13]
[13]See, eg, R v Towle [2009] VSCA 280, [66]–[68]; Winch v The Queen (2010) 27 VR 658, 665 [36]; Orbit Drilling Pty Ltd v The Queen [2012] VSCA 82, [49].
In the present case, in my respectful opinion, his Honour paid insufficient attention to the first of these considerations. It was necessary to assess the magnitude of the foreseeable risk of the horse escaping through the paddock gate, in order to decide whether the care expected of a reasonable person in the position of the company extended to having in place some system for ensuring that the front gate was also kept closed. The magnitude of that risk fell to be assessed prospectively, not with the benefit of hindsight. That is, the Court had to ignore the fact of the accident, and the circumstances in which it took place, and assess the position on the basis of what the company knew (or ought to have known) before the accident.[14]
[14]Vairy v Wyong Shire Council (2005) 223 CLR 422, 461 [126], 443 [61]; Neindorf v Junkovic (2005) 80 ALJR 341, 361 [93]–[96] (‘Neindorf’).
Assessed in that way, the foreseeable risk of the horse escaping from the paddock was very small. (Although no point was taken about it, I doubt that the knowledge of Brendan was attributable to the company for this purpose.[15] Brendan was neither an employee nor an officer of the company. He had neither authority nor responsibility in relation to the paddock or the horse. He was effectively in the position of a neighbour or a bystander. The company conducted its appeal, however, on the basis that Brendan’s knowledge was relevant to the question of the company’s breach, and I proceed accordingly.)
[15]Cf Sedleigh-Denfield v O’Callaghan [1940] AC 880, 892:
[T]he knowledge of servants and agents for whom the owner is responsible must be attributed to him …
As the company’s appeal submission pointed out, the evidence established that:
(a) the gate latching mechanism had performed satisfactorily throughout the nine years of Brendan’s occupation of the house, and throughout the seven or eight month period during which the horse had been in the paddock;
(b) Brendan had never in nine years noticed that the gate was casually unlatched or open; and
(c) neither Brendan nor his father had experienced difficulty with the mechanism at any time prior to the accident.
Moreover, as the company submitted, it could properly be inferred from Brendan’s evidence that the last time he or (to his knowledge) his father had used the gate, it had been closed properly, and it had been properly closed for at least five days before the accident.
In short, neither the company nor Brendan had had any experience of the paddock gate ever being left open. There was no evidence — and hence no finding — that either of them had left the gate open, nor that the gate had ever come open — allowing the horse to escape — because of any inadequacy in the latching mechanism. In other words, so far as the company and Brendan were aware, the system which the company had in place for keeping the horse (and other stock) in the paddock and away from the road was operating perfectly satisfactorily. There was nothing to put the company, or Brendan, on notice that there was any risk of the horse escaping from the paddock — other than the theoretical possibility that some unidentified person might one day enter the paddock and leave the gate open.
The second consideration — the seriousness of the harm likely to result if that risk materialised — may be dealt with briefly. Given that the property abutted a busy highway on which cars would be travelling at high speed, it is plain that very serious harm would be likely to result if the horse should escape. So much was clearly foreseeable.
The question remains, however, what a reasonable person in the position of the company would have done by way of response in those circumstances.[16] There was a theoretical risk of escape but, if it materialised, it would be likely to produce catastrophic consequences.
[16]Neindorf (2005) 80 ALJR 341, 345 [8].
In my opinion, no additional response was required of the reasonable person, beyond the care and attention which was already directed to ensuring that the paddock gate was closed, and remained closed. The exercise of reasonable care did not require the company as occupier to institute a failsafe system to ensure that the entrance gate also remained closed at all times. As the company submitted, the contrary conclusion would effectively mean that there must always be two sets of closed gates in order to contain stock on land abutting a highway. Absent a finding that the paddock gate was known to be inadequate to contain the horse, there was no warrant for such a conclusion, in my view.
Duty of care owed by Brendan
As noted earlier, Brendan had lived on the property since 1997. He leased the house and its immediate surrounds from the company. He was not the manager of the property. He provided viticulture services to two vineyards on the property.
The judge made the following findings:
Brendan Woodley regularly used the driveway from the highway to his home. The driveway was also used by his wife, by members of their extended family, by persons with interests in the vineyards, by contractors and workers in the vineyards and by visitors seeking mushrooms or grapes. It was the practice of Brendan Woodley to leave open the front gate to the property. Although he occasionally put supplementary feed into the feed bin for the horse at the request of his father, it was not the responsibility of Brendan Woodley as tenant of the house and viticulturist to the vineyards to check the gate to the paddock, or to ensure that it was shut and latched properly, or to request the [company] to instigate a failsafe system.
However, in my judgment, a reasonable person in Brendan Woodley’s position, as the only resident (with his immediate family) on the property, the regular user of the driveway, exercising some degree of responsibility with respect to the property, knowing that if the horse escaped the paddock the risk that it would go to the highway and cause injury or death to highway users was high, would adopt the practice of keeping the front gate shut. In accordance with recognised practice on rural properties, it was probable that if Brendan Woodley kept the front gate closed and secured, other persons who used the gate would close and secure it. Such a response to the risk would involve no expense and minimal difficulty or inconvenience. His failure to keep the front gate closed and secured was a breach of the duty of care he owed to users of the adjoining highway.[17]
[17]Reasons, [33]–[34].
In my respectful opinion, his Honour was in error in holding that Brendan owed a duty of care to users of the highway. Brendan was not the occupier of the property on which the horse was kept; he was not in control of the use of the horse paddock; and he had no responsibility for the care or containment of stock kept in the paddock.
Most important, in my view, was the fact that Brendan lacked the requisite control over either the paddock gate or the entrance gate. The importance of control as a factor relevant to the existence of a duty of care in such circumstances was emphasised by Nettle JA in McLean, as follows:
[A]s Mason J explained in Kondis v State Transport Authority, the element in a relationship between the parties which generates a special responsibility or duty to see that care is taken (scil gives rise to a non-delegable duty) may be found in one or more of several circumstances. So in cases like Dalton v Angus, Bower v Peate and Hughes v Percival, which were concerned with rights of support and interference with party walls, the relationship may be that of adjoining landowners such that the rights of one necessarily involve a correlative duty on the other when authorising work which might interfere with those rights to ensure that reasonable care and skill is exercised, rather than a duty merely to exercise reasonable care and skill by the appointment of a competent contractor. Contrastingly, in cases like hospitals and school authorities, the element in the relationship which generates the special responsibility and thus informs the existence of a non-delegable duty is the supervision and control which a hospital or school exercises over patients and pupils and the same is true of employer/employee. In a case like the present, where one is concerned with the escape of something from land, the element in the relationship which is surely most relevant is the control which the appellant exercised over the land and the vulnerability of the first respondent vis-à-vis the appellant in relation to activities conducted on the land. In such cases, the nuisance decisions like Laugher v Pointer and Quarman v Burnett appear to be more directly in point.[18]
[18]McLean (2005) 13 VR 241, 247–8 [16] (citations omitted, emphasis added).
Brendan was the company’s neighbour. He was the occupier of a property adjacent to the property where the relevant activity (the agistment of the horse) was taking place. Notwithstanding the physical proximity of the house to the paddock, there was no basis, in my view, for the imposition on him of a duty of care in relation to a risk arising from his neighbour’s activities on its property.
If I were wrong about that, then for similar reasons to those I have given in relation to the company, there was no basis for a finding of breach.
PART 2: APPORTIONMENT AND QUANTUM
As noted earlier, the trial judge apportioned liability on a 90/10 basis as between the company and Brendan. That apportionment was challenged in both appeals, as was his Honour’s quantification of the amounts payable to the Commission. In view of my conclusion that the Commission’s indemnity claim should have been dismissed, it is not strictly necessary to proceed to deal with these additional grounds of appeal. The questions were, however, fully argued and it is appropriate to deal with them, in case there should be further proceedings.[19]
[19]See Kuru v NSW (2008) 236 CLR 1, 6 [12] (Gleeson CJ).
Apportionment
When approaching the question of apportionment, his Honour noted that the task involved ‘a comparison of culpability and the relative importance of the acts of the parties in causing the damage’.[20] In his Honour’s opinion, the company’s culpability ‘greatly exceeded’ Brendan’s, warranting a 90/10 apportionment.
[20]McLean (2005) 13 VR 241, 256 [40].
The appeal submission for the company was that the ‘principal cause’ of the escape of the horse was the negligence of some unidentified person in leaving the paddock gate unsecured. As the submission noted, his Honour made no finding that the escape of the horse was the result of the paddock gate being left open either by a servant or agent of the company or by Brendan. It followed, according to the submission, that the unknown person who had left the gate open was a contributor to the death and injury, which should have been assessed in the process of apportionment.
The appeal submission for Brendan drew attention to the responsibility of his father, as the owner of the horse. So far as the front gate was concerned, it was contended that if (contrary to Brendan’s primary submission) he owed a duty to road users to ensure that the front gate was kept closed, then the other users of the gate must each have owed a like duty. It followed, according to the submission, that in apportioning liability his Honour ought to have considered both the owner of the horse and the other persons who used the gate.
Both sets of submissions must be rejected, in my view. The assumption on which they are based — that each of the other persons referred to owed a duty of care to highway users — is unsound. There is nothing in the evidence, in my opinion, which would have enabled the judge, or would enable this Court, to conclude that any such duty existed, less still that there was a breach of such a duty if it existed. The critical features bearing on duty and breach — occupation, control and knowledge of risk — were either wholly or substantially absent in each of those other cases.
Quantum — loss of dependency
At the time of her death, Leanne Burnett was aged 32. She was in good health and was employed part-time, performing administrative work for a local insurance brokerage. Her weekly earnings were between $200-300 and $400-500.
Mrs Burnett and her daughter Jaime shared an interest in horses. Jaime belonged to a pony club. Mrs Burnett spent an hour or two each day after school with Jaime in activity with horses, and five to ten hours each weekend. She spent another hour or two each day with horses herself. She was actively involved in the pony club, including as an instructor. The family owned four horses and a small pony. Three were Mrs Burnett’s and one was Jaime’s, but Jaime did not ride only that horse. She and her mother spent a lot of time together caring for the horses, feeding, grooming and riding them.
The trial judge found that Mrs Burnett was ‘modest’ in her expenditure, save for costs associated with her interest in horses. The money that she earned in her employment was mostly spent on her own needs and expenses related to the horses. She made only a minimal contribution to household expenses.
At the date of her death, Mrs Burnett intended to accept an offer from her employer to increase her work hours to four days a week. She was interested in the work and had obtained qualifications to act in matters of insurance. She considered that she would be able to do some work from home and that it would not interfere with her care of the children. The increase in her income would have been available for the general support of the family.
Following the accident, the horses were sold or given away. One was sold for $2,000, another for a few hundred dollars. The float was sold for $5,500 and the Land Rover, which had been used to pull the float, for just under $20,000.
At the time of his wife’s death, Dale Burnett was employed as general manager by a company building motor homes. He had been in that job since March 2006. He enjoyed his work and had been successful in improving the performance of the company. He was absent from home during the week, leaving most mornings at 6am and returning at 6:00pm. He often worked on Saturday mornings, and sometimes on Sunday, working on average five hours each weekend. He earned approximately $100,000 per annum plus compulsory superannuation and a car.
Following the death of his wife, Mr Burnett did not return to that employment but remained at home to care for his two young children. It was a full-time task. He spent minimal time in farm work. In February 2007, approximately six months after the accident, he commenced employment as a delivery driver. He worked from 9:00am to 3:00pm for three or four days a week, which enabled him to provide the necessary care for the children. He earned approximately $300 per week. This employment lasted approximately three months. Then, from June 2007 to May 2008, he did other odd jobs.
From May 2008 to May 2009, Mr Burnett worked as a fencing contractor, doing approximately 20 to 30 hours per week and earning approximately $600 per week. In May 2009, he commenced employment as a production manager, on a salary of $80,000 per annum plus superannuation and a car. He remained in that employment until April 2011, when he commenced employment as production manager with a different company. He is now earning approximately the same as he was before the accident, that is, $100,000 plus compulsory superannuation and the use of a car.
His Honour concluded that allowance should be made for the loss of Mrs Burnett’s income for 20 years from the time of trial. Using appropriate multipliers, his Honour concluded that the total loss of income as a consequence of Mrs Burnett’s death was $619,712.25.[21] His Honour continued:
In February 2012 Jaime Burnett would be 14 years of age and Hannah Burnett 9 years of age. Dale and Leanne Burnett had ambitions for their daughters to receive a good secondary education at private schools and to proceed to tertiary education or training. It is reasonable to consider that the girls would have been largely dependent on their parents until aged 21, that is, for 7 years until 2019 for Jaime, and 12 years until 2024 for Hannah.
I do not accept the submission of [counsel for the company] that money earned by Mrs Burnett would have been spent on herself and her passion for horses. It is artificial to separate her involvement with horses from Jaime’s involvement with them. It was an interest of each of them and very much a shared activity and had Mrs Burnett lived, it is likely that it would have been increasingly so.
It is reasonable to consider that in the period of approximately 20 years to 2032 when the deceased would have continued to work, for half of that period half of Mrs Burnett’s income would have been used for the benefit of Jaime and Hannah, for their clothing, personal costs, costs associated with their recreation and interests including horses, assistance with the costs of their education, and the general costs of the family and the household, including the cost of holidays. When the education of Jaime and Hannah was completed, during the remaining half of the period, and having regard to Mr Burnett’s income, it is likely that a lesser proportion of Mrs Burnett’s income would be used for the benefit of Mr Burnett and the household, something in the order of 25%.
Taking these matters into account, the share of the benefit of the income of the deceased which the dependants would have reasonably expected to have enjoyed should be assessed at 40% of that income, that is, $247,884.[22]
[21]Reasons, [108].
[22]Ibid [109]–[112].
The company challenged this conclusion on two grounds. The first was that the Burnett family was not financially dependent on Mrs Burnett’s income at the date of the death; the second was that she was financially dependent on her husband, such that her death had resulted in an improvement of the financial position of the family. In both respects, the submission relied on Mr Burnett’s evidence that his wife’s earnings were kept in a separate bank account, from which the contribution to household expenses was ‘very minimal, if any at all’. Her income, Mr Burnett said, was spent ‘predominantly [on] horses’. He explained that Mrs Burnett spent money on feed, equipment, veterinary bills and maintenance of the horse float. According to the submission, it was simply not open given this evidence to conclude that the family was in any material way dependent on Mrs Burnett’s income. The true position was the reverse, that is, she was dependent on her husband for so much of the household expenditure as was referable to her living expenses.
In support of this submission, counsel for the company provided to the Court a table purporting to quantify the cost to the family of Mrs Burnett’s dependency. The table is set out below. It includes three alternative calculations, depending on the percentage dependency attributed to Mrs Burnett.
COST/VALUE OF LEANNE’S DEPENDENCE ON DALE
Dale earns $100,000 p.a. + super & car
Rate of dependency
Leanne’s dependency p.a.
Leanne’s dependency p.w.
Saving from date of accident to trial: 5½ years
Saving from trial to 2032; Multiplier is 788.
TOTAL
30%
$30,000
$577
$165,000
+ $454,615
___________
= $619,615
25%
$25,000
$481
$137,500
$378,846
________
$516,346
20%
$20,000
$385
$110,000
$303,077
________
$413,077
The submission for the Commission was that his Honour’s assessment of 40 per cent dependency on Mrs Burnett’s income was ‘appropriate having regard to the broad and necessarily imprecise nature of his Honour’s task’.[23] I do not agree. In my opinion, in the face of the clear and unambiguous evidence about the diversion of Mrs Burnett’s income to her activities with horses, it was not open to conclude that the family were financially dependent on her. Nor could the financial impact of her death be calculated without taking into account the extent to which she was, of necessity, dependent on her husband’s income. Doing the best I can, I consider that a calculation which assumed that Mrs Burnett’s dependency accounted for 25 per cent of the household income was appropriate.
[23]The submission cited De Sales v Ingrilli (2002) 212 CLR 338, 348 [14], 363–4 [66]–[68] (‘De Sales’).
Quantum — the effect of remarriage
At the end of 2008 — more than two years after the accident — Mr Burnett commenced a domestic relationship with Ms Kerryn Kirkpatrick, who has two daughters of similar age to Mr Burnett’s daughters. Mr Burnett and Ms Kirkpatrick married on 12 November 2011. The judge found that, since they began living together, Ms Kirkpatrick had been doing the sort of housework Mrs Burnett had been doing. She had taken over the role of housekeeper, wife and stepmother. There was shared responsibility with respect to Mr Burnett’s daughters.
Ms Kirkpatrick works five days a fortnight, from 9:00am to 3:00pm. His Honour noted that, but for the accident, Mrs Burnett would have increased her paid employment from one to four days a week, and would as a result have had significantly less time for household tasks. He concluded that damages for the loss of gratuitous care should be based on four hours per day, or 28 hours a week. Applying the rate of $25 per hour, his Honour assessed the value of the lost service:
(a) for the period of 282 weeks from the date of the accident to the trial — at $197,400; and
(b) for the future, assumed to be a period of 33 years — at $770,000.
According to the company’s submission, his Honour should have assessed the value of the loss of gratuitous service only for the period up to November 2008, when Mr Burnett and Ms Kirkpatrick began living together. In considering this submission, it is necessary to refer first to the decision of the High Court in De Sales.[24] In that case, the Full Court of the Supreme Court of Western Australia had discounted the damages payable to a widow by 20 per cent for the prospects of an advantageous marriage or relationship. There was a separate discount of 5 per cent for general contingencies.
[24]De Sales (2002) 212 CLR 338.
On appeal, the High Court held (by majority) that this was erroneous and that, in the ordinary case, the contingency of a financially beneficial remarriage or relationship should be treated as part of the general ‘vicissitudes of life’. Gleeson CJ said:
Allowance is to be made for the contingency of a financially beneficial remarriage, in the same way as allowance is made for the contingency of premature death, injury, unemployment or financial ruin. It is a chance which usually cannot be predicted with any degree of certainty in a particular case, but which, in the population as a whole, is not a chance that can be disregarded as insignificant.[25]
[25]Ibid 354 [32].
Gaudron, Gummow and Hayne JJ said:
The range of possibilities that lie before those for whose benefit a claim is made under legislation modelled on Lord Campbell’s Act is very wide. The financial consequences of some may be to the advantage of the surviving relatives, others may be to their disadvantage. Why should one of those possibilities (remarriage, or the formation of some other continuing relationship) be considered separately from all others? To consider it separately assumes that it is a contingency whose likelihood of occurrence can be separately assessed with reasonable accuracy, and that the financial consequences of its occurrence will, more probably than not, tend in one direction (financial advantage) rather than the other.
…
It is, therefore, wrong to treat the prospect of remarriage or the prospect of forming some new continuing relationship as a separate item for which some identified discount must be made from whatever calculation is made of the present value of future benefits that would have flowed from the deceased to the relatives. Even if the prospects that a surviving spouse would remarry or enter a new continuing relationship could be assessed (and there will be few cases where that would be possible), predicting when that would occur is impossible, and predicting some likely outer limit of time by which it would probably have occurred is only slightly less difficult. But most importantly, it cannot be assumed that any new union will be, or will remain, of financial advantage to any of those for whose benefit the action is brought. That being so, some financially advantageous marriage or relationship must be treated as only one of many possible paths that the future may hold. It is wrong to single it out for special and separate allowance. That others in the past have had damages reduced on this account is not reason enough to continue the error.[26]
[26]Ibid 365 [72], 366–7 [76].
The majority judgments were careful, however, to distinguish the case where the evidence established that, by the time of the trial, the plaintiff had already entered a financially beneficial remarriage. Thus, Gleeson CJ said:
In some cases, a plaintiff may be able to show unusual circumstances which suggest that there is almost no chance of remarriage. Or, it may be arguable that actual remarriage, to a person who offers no financial benefit, effectively precludes the chance of a financially beneficial remarriage. In other cases, a defendant may be able to show special circumstances which suggest that the chances of the plaintiff’s loss being reduced by a financially beneficial remarriage are notably higher. Such circumstances include where a person has actually remarried, to his or her pecuniary advantage, before the trial. In these circumstances, there may be concrete evidence which suggests that part or all of the plaintiff’s loss will be replaced by benefits received from their new spouse.[27]
[27]Ibid 354 [33] (citation omitted, emphasis added).
Gaudron, Gummow and Hayne JJ said:
That is not to say that, if there is evidence at trial that a new relationship has been formed, account may not be taken of evidence revealing whether that brings with it financial advantage or disadvantage. It would be wrong to adopt the rule followed in some American jurisdictions and require the tribunal of fact to assess the damages without that evidence. If the relationship is reflected in marriage, or if there is relevant legislation creating rights between de facto partners, the property rights of the partners will no doubt loom large in that assessment. Likewise, if there is evidence that a surviving spouse (or de facto spouse) intends, at the time of trial, to establish such a relationship with an identified person, account may be taken of evidence of the probable financial consequences of that relationship. In each case, however, it would be wrong to assume that the financial consequences revealed in evidence will inevitably continue.
Ordinarily, such cases apart, no separate allowance should be made for the possibility, even probability, that a new relationship will be formed.[28]
[28]Ibid 367–8 [78]–[79].
Subsequently, the Victorian Parliament enacted the Wrongs (Remarriage Discount) Act 2004 (Vic), inserting s 19(2) of the Wrongs Act 1958 (Vic) which provides as follows:
In assessing damages in an action under this Part, that is commenced on or after the commencement of the Wrongs (Remarriage Discount) Act 2004, no separate reduction may be made on account of—
(a) the remarriage or formation of a domestic partnership; or
(b) the prospects of remarriage or formation of a domestic partnership—
of the surviving spouse or domestic partner, or a surviving former spouse or former domestic partner, of the deceased person.
In his Second Reading Speech, the then Attorney-General said:
The bill amends section 17 of the Wrongs Act 1958 to provide that in an action for damages for wrongful death, the court may not take into account the plaintiff’s prospects of remarriage or of forming a new domestic partnership in order to make a separate reduction in damages awarded to the plaintiff.
Until very recently, courts assessed the likelihood that the plaintiff — almost always a woman — would remarry on the basis of her ‘appearance, credentials and demeanour’. In late 2002 the High Court overturned this outdated precedent in the decision of De Sales v Ingrilli, clearly stating that the ‘remarriage discount’ no longer applies in Australia.
This bill protects the plaintiff in a wrongful death suit from outdated judicial considerations in which the court made a specific discount based on how likely the court considered it was that the plaintiff would remarry. The bill does this by reflecting the High Court decision in De Sales v Ingrilli in which the High Court found that the ‘remarriage discount’ as it was known, no longer applied in Australia.
Making a specific discount for remarriage or repartnering or the prospects of remarriage or repartnership is fundamentally flawed in two ways.
First, there is simply no way to predict whether, or when, one human being will form a permanent relationship with another person. Predictions made upon the basis of the attractiveness, age and demeanour of the plaintiff are subjective, outdated and frankly offensive.
Secondly, to discount the plaintiff’s damages on the basis that she is likely to remarry or repartner presupposes that remarriage or repartnering will be financially beneficial. This is not an assumption that can be made with any certainty. It is based on outdated notions about a woman’s role in society. When the common law in this area was developed in the 1800s a woman was completely dependent on her husband not only for income, but also for property. Times have changed. Not only is a woman likely to be contributing significantly to the finances of the marriage, but there is no way to predict the earning capacity of her new partner.[29]
[29]Victoria, Parliamentary Debates, Legislative Assembly, 29 October 2003, 1294–5 (Rob Hulls, Attorney-General).
It can be seen that, in explaining the amendment, the Minister encapsulated the views of the High Court majority as they applied to the — inevitably speculative — question of whether the plaintiff would remarry and, if so, whether the remarriage would be financially advantageous. The Minister went on, however to make clear — as the Bill itself did — that the prohibition on a ‘separate reduction’ applied not only to the prospect of remarriage but to the fact of remarriage itself. The Minister said:
As marriage rates decline and the rate of domestic partnerships rises, extending the prohibition on the court’s consideration of the prospects of remarriage to the prospects of forming a domestic partnership is necessary and appropriate.
However, the bill in no way prevents the court from making a general discount in these cases for those things recognised as the ‘vicissitudes of life’. The vicissitudes of life are factors which would potentially increase or decrease the financial needs of the plaintiff throughout their life — for example, the plaintiff may die earlier than could be expected in the normal course of life, win the lottery or develop an illness or disability.
I note that nothing in the bill prevents, for example, the court from taking into account the fact that the plaintiff has married or may marry a wealthy partner. However, this would simply be one of many factors considered in the context of the vicissitudes of life, given no more or less weight than any of the other general factors which make up the vicissitudes of life.[30]
[30]Ibid 1295 (emphasis added).
The distinction drawn by the High Court — between the possibility of future remarriage and the fact of remarriage as at the date of the trial — seems, with respect, both necessary and appropriate. Plainly enough, the fact of remarriage raises quite different considerations, in the context of an assessment of damages, from the mere possibility that there might be remarriage in the future. As clearly stated in the majority judgments in De Sales, it would be wrong to ignore a change in the plaintiff’s position which has taken place between the date of the fatal accident and the trial. Otherwise the damages assessment will be based on the false assumption that the plaintiff is, and is likely to continue to be, without the benefit of the domestic assistance formerly provided by the deceased spouse.
Plainly enough, Parliament intended to abolish what was viewed both as outdated and — following De Sales — as legally erroneous, namely, the making of a separate (global) discount based on the court’s assessment of the particular plaintiff’s prospects of remarriage. It seems surprising, however, that the legislature chose to
deal with the fact of remarriage in the same way, given the fundamental difference between present fact and speculation about the future, as clearly explained by the High Court in De Sales. The effect of doing so, as the present case illustrates, is to require the court to ignore plain facts established before it, being facts bearing directly on the loss actually suffered by the plaintiff.
The phrase ‘no separate reduction’ in s 19(2) is not free from ambiguity. Given the legislative history, it might be thought to refer only to a global reduction, applied to the aggregate damages once fully assessed. On that view, the subsection would not prevent the fact of remarriage being taken into account in calculating a particular component of the loss. But the extrinsic materials suggest otherwise. As appears from the extract set out above, the Attorney-General made express reference to a case involving actual remarriage, and stated quite explicitly that, as with the future possibility of remarriage, this was to be dealt with under the general ‘vicissitudes of life’. The clear implication is that this is the only way in which it can be taken into account.
Accordingly, it seems, his Honour was complying with Victorian law in assessing the loss relating to domestic services without regard to the fact of Mr Burnett’s repartnering. For the reasons I have given, this seems to me to be an anomalous and unjust result, and one which conflicts with, rather than giving effect to, the High Court decision in De Sales. Whether any legislative change is required is, of course, a matter for Parliament.
TATE JA:
I have had the considerable advantage of reading the draft judgment of Maxwell P. I agree, for the reasons his Honour gives, that there was no breach of duty by the company and that Brendan Woodley owed no duty of care to road users in respect of any risk associated with the horse. It follows that both the appeal brought by the company, and the appeal brought by Brendan Woodley, should be allowed.
The remaining observations by his Honour are strictly obiter.
However, with respect to the cost to the family of Mrs Burnett’s dependency on the household (from which they were financially saved by reason of her death), this Court was faced with the difficulty that the alternative percentage calculations relied on during the appeal had not been the subject of evidence below.
With respect to the effect of remarriage, in my opinion it is plain from the terms of s 19(2) of the Wrongs Act 1958 that no separate reduction in damages is permissible by reason either of the fact of a remarriage (or formation of a domestic partnership) or the prospect of a remarriage (or formation of a domestic partnership). Section 19(2) specifically distinguishes between those circumstances so as to acknowledge their difference, yet it provides that they are to be governed by the same prohibition. This does not preclude a court from taking into account the fact that a plaintiff had remarried as part of the vicissitudes of life, as the judge did.
His Honour said:
An allowance should be made for the general vicissitudes of life such as illness, premature death, unemployment, separation, divorce, remarriage. Both Dale Burnett and Leanne Burnett were relatively young at the time of Mrs Burnett’s death. They were in good health. Mr Burnett has in fact remarried and his present wife provides household services which were provided by the deceased. Victorian courts have commonly allowed a deduction of 15% for the general vicissitudes of life. Taking into account Mr Burnett’s remarriage a discount of 20% is appropriate.[31]
[31]Reasons, [124].
I see no error in his Honour’s approach.
PRIEST JA:
I agree, for the reasons given by Maxwell P, that the appeal in each case should be allowed.
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