Bale v Seltsam Pty Ltd

[1996] HCATrans 358

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B46 of 1996

B e t w e e n -

JOYCE BARBARA BALE

Applicant

and

SELTSAM PTY LTD

Respondent

Application for special leave to appeal

GAUDRON J
McHUGH J
KIRBY J

TRANSCRIPT OF PROCEEDINGS

FROM BRISBANE BY VIDEO LINK TO CANBERRA

ON MONDAY, 2 DECEMBER 1996, AT 12.13 AM

Copyright in the High Court of Australia

MR K.C. FLEMING, QC:   If the Court pleases, I appear with MR R.M. STENSON, for the applicant.  (instructed by Cleary Hoare)

MR S.L. DOYLE, SC:   If the Court pleases, I appear with my learned friend, MR D.G. CLOTHIER, for the respondent.  (instructed by Ebsworth & Ebsworth)

GAUDRON J:   Yes.  We think in this matter it might be appropriate if Mr Doyle were to commence.

MR FLEMING:   If the Court pleases.

MR DOYLE:   Your Honours, we submit this is not a case where special leave ought to be granted.  There are three points which emerge from our learned friend’s outline of argument and none of them, in our submission, warrants the grant of special leave.  The first concerns the role to be played by the notion of proximity and if we could ask your Honours to go first in the application book to page 130.  Your Honours will see on the grounds of the appeal, ground No 2(c) it is said:

The majority of the Court of Appeal considered the test to be one of foreseeability of harm, rather than one of proximity and specifically whether the kind of damage would occur to the category of person of whom the Appellant was one.

We draw from that that the applicant contends that proximity ‑ ‑ ‑

GAUDRON J:   Well, I think if you were to - whatever the phrasing, the first two grounds of appeal in the draft notice of appeal do send you direct attention to a different issue.  Certainly ground 2(b) directly raises foreseeability.

MR DOYLE:   They do.  Your Honour, can I tell your Honours what the three points that I propose to address your Honours on are?  The first is the question of proximity and, really, I have started with that and I will return to that in a moment.  The second is whether there is a different test to be applied where dangerous products are the subject of dealings by, in this case, the defendant.  The third question is that of foreseeability, so, that we intend to deal with each of those in turn.  I will deal briefly with the first one because we dealt with this at some length in our written outline.  On the question of proximity, the applicant contends, it would seem, that proximity of itself, the establishment of a sufficiently close relationship, is enough to give rise to a duty of care.  Such a conclusion, we submit, is unsustainable.  We have referred, at the top of page 2, of our outline of submissions, to a number of decisions of this Court which establish that‑ ‑ ‑

KIRBY J:   You do not dispute that proximity was established?  You just say it is not enough?

MR DOYLE:   No, that is so.  Indeed, there is a finding to the effect that proximity would have been established had there been a foreseeable risk of harm.  So that, unless the Court is prepared to accept that what we infer to be the applicant’s contention that a duty of care can arise without there being foreseeable risk of harm, this first point ought to fail.  Your Honours, can we then deal with the second proposition and that is that there is some special test which ought to be applied where a manufacturer is dealing with a product described as being inherently dangerous. 

Now, at least as concerns the question of whether or not a duty of care exists, it is our submission that it is plain, again from the decisions to which we have referred in our outline, that there is no special test.  Rather, the nature of the danger, the magnitude of the risk occurring, and the magnitude of the harm are all things which go to determining the degree of care which need to be exercised, but the mere fact that the product is one which might be described as dangerous is not of itself such as to give rise to a different question when the question is, “Is there foreseeable risk of harm?”  Anything in different combination or in bulk or in different circumstances can be a dangerous product and the ultimate test, we submit, must be whether its use gives rise to a foreseeable risk of harm to a person or a class of persons of whom the plaintiff is a member.  So, that, again, so far as the applicant seeks to contend there is some special leave question here, because the Court of Appeal and the trial judge in turn failed to apply a special test, in our submission, that submission would be unsustainable. 

Your Honours, that brings us then to the third matter which is raised against us which is essentially that the trial judge and the majority in the Court of Appeal were wrong in finding that there was no foreseeable risk of harm.  Can I take your Honours first to the findings and I will ask your Honours first to start with the finding of the President at page 110.  The President’s findings commence in the paragraph towards the top of the page:

More importantly, in my opinion, the respondent ought to have known, at the latest by the end of 1962, that there was a risk that amongst the unidentified and unknown possible toxic effects of asbestos dust was injury or illness to those, such as wives, who were exposed to it by its introduction into their homes and lives by their husbands bringing it with them from their place of employment.  Further, because of the known toxicity of asbestos dust, the known uncertainty with respect to its effects, and the knowledge that injury or illness might not emerge for many years, that risk could not be dismissed as “remote”, “slight”, “far-fetched”, or “fanciful” -

and so on.  That is the finding which, as I understand it, the applicant contends ought to have been made by the majority and by the trial judge.  Your Honours will appreciate that the majority did not make that finding.  They upheld the trial judge’s determination on the evidence that there was no foreseeable risk of harm.  In our submission, unless there is some error of principle, this can only be described as a case where, at best for the applicant, there has been some misapplication of well‑established principle, but the reasons given in‑ ‑ ‑

GAUDRON J:   Did the majority really pose for itself the right question, though, Mr Doyle?  They seem to have focused on knowledge of the possibility of the illness which this unfortunate lady has eventually suffered, rather than the risk of some harm.

MR DOYLE:   Well, the majority’s decision is to be understood against the background of what the trial judge decided.  The trial judge, we would submit, adopted the correct test and I will take your Honours in a moment to her findings which show that.  She went on, though, to consider the question of whether any harm was foreseeable and dealt with the submission put against the respondent before your Honours that there was a distinction between different classes of harm and her Honour applied each of the right tests and decided all of the questions bar the important one in favour of the applicant before your Honours, namely, that there was no foreseeable risk of any harm to her.  Now, against that background, that being the only live question, really, on appeal to the Court of Appeal, the way in which the majority expressed their findings is entirely appropriate that on the evidence which the trial judge considered and which they had to deal with there was no foreseeable risk of harm.  Your Honours, Mr Justice Helman is the member of the majority who expressed his findings and they appear at page 117, at the bottom of the page:

But her Honour concluded on the evidence before her - and in my view correctly - that at the relevant time that consequence was, having regard to the state of scientific knowledge on the subject, not reasonably foreseeable. 

And the consequence is that which is spoken of earlier in the same paragraph by his Honour.  He speaks there of “physical injury of a class” ‑ ‑ ‑

KIRBY J:   “To a class”.

MR DOYLE:   Sorry, “to a class”.  So that, with respect, is the right question and we would submit the right answer, or at least plainly one which was open to the trial judge on the evidence and, accordingly, open to the majority in the Court of Appeal on the evidence. 

Now, your Honours, we have set out at some length in our outline of argument reference to some of the evidence which was given at the trial and your Honours will appreciate that there was a great deal of examination of the documents which were available to manufacturers of asbestos and to experts in the field.

KIRBY J:   If you look at Justice McPherson, on that last point, at page 112.9, it says:

the defendant could not reasonably have foreseen that she might contract the disease.

This is the point that Justice Gaudron put to you that his Honour is focusing on the particular consequence, whereas the test merely requires focusing on some harm with the detail to work its way out. 

MR DOYLE:   We understand the distinction, your Honour.

KIRBY J:   So one of the two foundations for your judgment is really erroneous, with respect.

MR DOYLE:   Your Honour, the way in which Justice McPherson has expressed himself is by first expressing his agreement with the reasons of Justice Helman to which I have already taken you.

KIRBY J:   Yes, but then we get a real clue as to what he took Justice Helman to be saying.

MR DOYLE:   It is to be understood, your Honour, against the factual findings which went to the Court of Appeal which were, as I have already outlined them to be, that there was no foreseeable risk.  There is no suggestion, as we apprehend it, that the trial judge formulated the wrong test.  Rather, it is said she applied it wrongly.  When the only question which goes to the Court of Appeal is whether or not on that evidence there was a foreseeable risk of harm, it is understandable that Justice McPherson would express his conclusion in the way in which your Honours have brought it to our attention.  But it does not alter the fact that there is a finding made by the trial judge after examination of all the evidence that there was no risk of any harm.  The risk which was perceived which asbestos ‑ ‑ ‑

KIRBY J:   Where does the trial judge deal with this point?

MR DOYLE:   Your Honours, it appears in several places.  Her ultimate finding is at page 65 of the application book at about point 2:

As will be apparent from the foregoing I have formed the view that between -

the relevant period -

it was not reasonably foreseeable that a person in the position of Mrs Bale would sustain personal injury of any kind as a consequence of her shaking out and laundering -

et cetera.  That is the way in which the case was conducted on appeal, to challenge that conclusion on the basis that there was ‑ ‑ ‑

McHUGH J:   Do you support that statement?

MR DOYLE:   Yes, your Honour.

McHUGH J:   Is that a correct test in the context of this case?  In the context of this case, surely what one was looking at was whether or not there was some sort of a risk.

MR DOYLE:   That is so.  It would have been better expressed ‑ ‑ ‑

McHUGH J:   What the risk was one was not certain about but, if there was, then simple precautions were available to eliminate it.

MR DOYLE:   What I have taken your Honours to there is the finding that it was not reasonably foreseeable that any kind of disease or injury might follow from exposure to asbestos dust.

McHUGH J:   I know that but ‑ ‑ ‑

MR DOYLE:   It is elsewhere ‑ ‑ ‑

McHUGH J:   Elsewhere it is even put - the judge spoke in terms of “likelihood”.

MR DOYLE:   Could I ask your Honours to go first to page 59 of the application book.  At about point 5 of the page, after discussing some decisions of this Court which touch upon this very question, her Honour said:

The defendant plainly had a duty to those who might reasonably be foreseen as likely to be harmed if care were not taken in conducting activities at its factory at Gaythorne.

If one stopped there, your Honour Justice McHugh’s observation to me would be apposite.  But her Honour goes on:

The risk of injury must not ‑ ‑ ‑

McHUGH J:   I know that, but she had also used the same expression at page 59, just below the long quote, where she says in the second line after that:

reasonably be foreseen as likely to be harmed -

I am sorry, you go on anyway, Mr Doyle.

MR DOYLE:   Her Honour goes on at page 59 to make plain that she is not using “likely” in the sense of probable:

the risk of injury must not be “a mere possibility which would never occur to the mind of a reasonable man” -

and she refers, we would submit correctly, as well to the Court’s decision in Wyong Shire Council v Shirt.  So that it cannot be thought that it escaped her Honour’s attention that the test was not one of probability but rather whether the risk was other than a far‑fetched or fanciful risk.  There are other passages in her Honour’s judgement which make that plain.  If we could ask your Honours to turn to page 62 of the application book, from about point 4, and then again on the next page ‑ ‑ ‑

GAUDRON J:   But why are we looking in any event at mesothelioma rather than personal injury in the broad; a risk of personal injury?

MR DOYLE:   Because the risk, the potential of which was identified in the evidence, was a risk of mesothelioma.  There was no evidence to establish there was a risk of asbestosis or any other disease but for mesothelioma.  So that is the focus of the attention on the evidence.

KIRBY J:   You say that the way in which her Honour deals with the matter there is purely descriptive of the context in which she is being asked to apply the legal principles?

MR DOYLE:   That is so, and against the background, having regard to the passages I have taken the Court to, that she was plainly asking herself the right question.  On the evidence which she had to ask that question about, the question was whether, the only possible injury being mesothelioma, it was reasonably foreseeable in the period with which this case was concerned that she might be exposed to such a risk.

McHUGH J:   But I am not sure that the traditional formulation of risk is appropriate in this particular class of case.  The problem is more about the uncertainty of the effects of asbestos dust.  May not the correct test be:  having regard to the uncertain knowledge as to the effects of asbestos dust and what degree of exposure was required, it was reasonable for the defendant to carry on its operations in the way it did?

MR DOYLE:   Your Honour, we apprehend that is more a difference of words than a principle.  We would submit it ultimately depends upon someone, an objective person or the defendant in a particular case, being able to reasonably foresee a risk.  The risk may be that, “I don’t know just what this dust will do to these people but there is a non‑trivial or other than far‑fetched or fanciful risk that it will cause them personal injury”.  So in that sense uncertainty about the consequences is accommodated by the test which ought to be applied.  But it nevertheless remains a question of whether there is some risk which is foreseeable, even though you cannot with precision say what the nature or the degree of the risk might be.  But the evidence of this matter is that those people who were at the very forefront of the medical research at the time did not themselves see any risk.

So that, whilst it might be fair to say in some cases uncertainty connotes the same as knowledge of a risk, here that really is elevating the evidence too highly.  The people at the forefront did note appreciate there was any risk.  They appreciated that asbestos could cause injury to workers who were exposed to heavy doses for long periods but they did not appreciate any risk to bystanders or background risk resulting from low‑level exposure.  In our outline of submissions ‑ ‑ ‑

McHUGH J:   Yes, but the fact that the experts did not foresee it is not conclusive.  It may be that they ought to have foreseen it having regard to the raw data that they actually had at the time.

MR DOYLE:   Your Honour, we would submit that is setting the test far too - we accept that it would be better had they foreseen it, but each case has to be decided on its facts.  The facts here were, as we apprehend the evidence, that the defendant did not appreciate the risk, that a series of experts were called who were, as her Honour describes them, at the forefront of their field and they did not appreciate the risk that there was a risk.  It is elevating the obligation too highly to say, we would submit, that in those circumstances a reasonable defendant in the position of an asbestos manufacturer ought to take steps to avoid a risk which they and experts do not foresee.  The case would be different had there been a finding that a reasonable person with those facts at their fingertips ought to have foreseen it, but that was not the finding.

McHUGH J:   Take the dissemination of a product like thalidomide.  Supposing the manufacturers say, “We don’t know whether or not there are any problems with this”, and then there turn out to be problems.  Can they avoid a finding of negligence on that basis simply because there is no evidence at that time that they knew of a risk or that anybody else knew of a risk?

MR DOYLE:   I would give the answer, yes, to that, they can avoid liability because there is no risk of which they can foresee.  But the answer might be better tested by asking if someone produces product X rather than thalidomide, which people know to be dangerous, and to the best knowledge that experts in the field have, product X does not expose any person in the background who does not take product X to a risk of injury and years later it is determined that product X does expose people in the background to risk of injury, which is what we would submit are the findings in this case.  We would submit, in those circumstances - - -

McHUGH J:   It just seems to me at the moment, Mr Doyle, more and more, that this case may be one for the grant of special leave simply because it raises some important questions about the dissemination of products which later turn out to be very dangerous or, as with asbestos dust, which is known to have some effects and that there is data which suggests that possibly it has got other effects, but one does not really know.

KIRBY J:   If special leave is granted, I hope the parties would help the Court with the development of United States jurisprudence on these matters.

MR DOYLE:   Yes.  Your Honour, we submit that it is not a case for special leave because it ultimately must be simply a question of whether the finding of fact that any risk was not reasonably foreseeable, reasonably being understood in the way that her Honour articulated it as being other than far-fetched or fanciful, whether that finding is right or wrong.  We would submit it was plainly right on the evidence but, even if wrong, it represents only a misapplication of well-established principle.  For those reasons, we would submit it ought not be a case where leave is granted.  There is no finding that, as a result of uncertainty, there was a risk which a reasonable person ought to have perceived.

GAUDRON J:   Yes.  I think your time is up, Mr Doyle, thank you.  We need not trouble you, Mr Fleming.  There will be a grant of special leave in this case.

AT 12.38 PM THE MATTER WAS CONCLUDED