Brocklands Pty Ltd v Tasmanian Networks Pty Ltd - [2020] TASFC 4

[2020] TASFC 4

COURT: SUPREME COURT OF TASMANIA (FULL COURT)

CITATION: Brocklands Pty Ltd v Tasmanian Networks Pty Ltd [2020] TASFC 4

PARTIES:  BROCKLANDS PTY LTD
  v
  TASMANIAN NETWORKS PTY LTD

FILE NO: FCA 1869/2019
JUDGMENT

APPEALED FROM: Brocklands Pty Ltd v Tasmanian Networks Pty Ltd

[2019] TASSC 26

DELIVERED ON:  15 June 2020
DELIVERED AT:  Hobart
HEARING DATES:  12, 13 November 2019
JUDGMENT OF:  Blow CJ, Estcourt and Pearce JJ

CATCHWORDS:

Torts – Negligence – Procedure and evidence – Evidence – Proof of causation generally – Circumstantial evidence – Damage caused by high voltage electricity entering low voltage system – Three possible routes – Multiple asserted breaches of duties of care – Whether plaintiff required to establish a particular breach of duty was causative.
Civil Liability Act 2002 (Tas), ss 13(1)(a), 13(2), 14.

Re Belhaven and Stenton Peerage (1875) 1 App Cas 278; Langmaid v Dobsons Vegetable Machinery Pty Ltd [2014] TASFC 6, 24 Tas R 18; Attorney-General's Reference (No 4 of 1980) [1981] 1 WLR 705, referred to.
Aust Dig Torts [1354]

REPRESENTATION:

Counsel:
             Appellant:  K E Read SC, T Cox
             Respondent:  B R McTaggart SC, K Sluiter
Solicitors:
             Appellant:  Phillips Taglieri
             Respondent:  H W L Ebsworth Lawyers

Judgment Number: [2020] TASFC 4
Number of paragraphs: 271

Serial No 4/2020
File No FCA 1869/2019

BROCKLANDS PTY LTD v TASMANIAN NETWORKS PTY LTD

REASONS FOR JUDGMENT FULL COURT

BLOW CJ
ESTCOURT J
PEARCE J
15 June 2020

Orders of the Court

Appeal allowed.

Judgment for respondent and ancillary orders as to costs set aside.

Judgment to be entered for the appellant against the respondent for damages to be assessed by a judicial officer other than the learned trial judge.

Serial No 4/2020
File No FCA 1869/2019

BROCKLANDS PTY LTD v TASMANIAN NETWORKS PTY LTD

REASONS FOR JUDGMENT FULL COURT

BLOW CJ
15 June 2020

The appellant company, Brocklands Pty Ltd, conducts a nursery business at Winkleigh in the north of Tasmania. On 10 December 2010 there was an interruption to the electricity supply at its nursery. At that time Aurora Energy Pty Ltd ("Aurora") was responsible for providing electricity to the property. The relevant liabilities of that company and its predecessor the Hydro-Electric Commission ("the HEC"), were transferred to the respondent, Tasmanian Networks Pty Ltd, in 2014 pursuant to s 19 of the Electricity Reform Act 2012. In 2015 the appellant brought an action for damages against the respondent, contending that it suffered harm as a result of the interruption to the electricity supply and breaches of duty on the part of Aurora and/or the HEC. It claimed more than $2.5 million by way of damages in respect of the alleged breaches of duty. The action was tried by Geason J over 14 days in the autumn and winter of 2018. The action failed. His Honour gave judgment for the respondent: Brocklands Pty Ltd v Tasmanian Networks Pty Ltd [2019] TASSC 26. This is an appeal from that judgment.
The principal findings made by the learned trial judge were as follows:
·     At [60], that the appellant's claim was not a claim for pure economic loss.
·     At [77], that a common law claim for damages for negligence had not been pleaded by the appellant.
·     At [101], that none of various breaches of statutory duty pleaded by the appellant conferred any private right of action. (That finding is not challenged by the appellant.)
·     At [156]-[262], that the appellant had failed to establish causation – that is, that it had failed to establish that the damage that it suffered was caused in any of the ways alleged by it.
The appellant's principal contentions in the appeal are to the following effect:
·     That, contrary to the conclusion of the learned trial judge, a common law claim for damages for negligence was sufficiently pleaded in its amended statement of claim. (Ground 1.)
·     That in evaluating the appellant's case, which was based on circumstantial evidence, his Honour erred by considering parts of the evidence in isolation from one another, rather than making an assessment of the combined strength of all the pieces of circumstantial evidence. (Ground 2.)
·     That the circumstantial evidence, properly assessed, compels a conclusion that the respondent is liable to it for damages for negligence. (Grounds 3-16 assert specific errors in relation to the assessment of the circumstantial evidence.)
The electricity for the appellant's nursery is generated in Trevallyn. High voltage electricity (22,000 volts) travels about 14 kilometres along high voltage ("HV") lines until it reaches a pole on the appellant's property, identified as pole 343836 ("the pole"). The pole has a transformer on it. Low voltage ("LV") electricity (230-240 volts) then travels from the pole to the nursery. The appellant is the only recipient of electricity from that pole.
On the night of 10 December 2010, a branch from a tree fell across an HV power line several kilometres away from the nursery. As a result, a circuit breaker called a recloser, located at Glengarry, cut off the power and then switched it back on again very quickly. It did that four times and then locked out. The appellant's case at trial was that the operation of the recloser caused a power surge; that that resulted in HV electricity entering the LV system on the appellant's property; that that happened because hardware on and below the pole was not configured or installed correctly; and that the HV electricity caused damage to a "program logic controller" ("the PLC") inside the appellant's potting machine. Its claim for damages was based on the damage said to have been caused in that way, including alleged consequential losses.
The respondent contended that the HEC and Aurora did not owe the appellant a common law duty of care. The learned trial judge did not address that issue because he concluded that no claim in negligence had been pleaded. The respondent further contended that there had been no breach of any asserted duty of care, and that the evidence fell short of proving that the appellant's damage had been caused by the incorrect configuration or installation of any of the hardware on or below the pole.
At trial, the appellant identified three ways by which it contended that HV electricity was likely to have entered the LV system:
·     By flashing over from a transformer component referred to as the HV right hand bushing to a cable known as an LV conductor.
·     By flashing over from a transformer component called a spark gap rod to an LV conductor.
·     By passing through the ground from an HV earthing conductor to an LV earthing conductor.
The appellant accepts that, in relation to each of these three hypotheses considered alone, the evidence fell short of establishing on the balance of probabilities that the HV electricity travelled as suggested. However the appellant contends that the evidence establishes the following on the balance of probabilities:
·     That it is possible that HV electricity entered the LV system in each of the three suggested ways.
·     That but for negligence on the part of the HEC and Aurora, it would not have been possible for HV electricity to enter the LV system in any of those ways.
·     That HV electricity must have entered the LV system in one or more of those ways.
On that basis, the appellant contends that it should be found as a fact, established on the balance of probabilities, that the damage to the PLC and all consequential damage resulted from negligence on the part of the HEC and Aurora.

Was negligence pleaded? (Ground 1)

The appellant amended its statement of claim on a number of occasions while the action was pending. The final version was an amended statement of claim dated 23 March 2018. That was the pleading in which, according to the learned trial judge, no cause of action in negligence was pleaded. The amended statement of claim began with appropriate assertions as to the appellant, its nursery business, Aurora and its responsibility for the electricity distribution network within Tasmania, the respondent, and the transfer to it of the liabilities of Aurora. Thereafter, the amended statement of claim included the following:
"6At all times from the date of the installation of the pole until the present the Hydro Electric Commission of Tasmania or its successor in title, Aurora Energy Pty Ltd was responsible for the installation and maintenance of the distribution network through which electricity was supplied to the property for use by the Plaintiff in conducting its business.
7Electricity was supplied to the property from power pole 343836, which includes, amongst other things, a transformer ('the pole').
8By reason of the Industry Act it was the duty of Aurora Energy Pty Ltd to supply electricity in accordance with the Tasmanian Electricity Code.
PARTICULARS
i      To provide electricity at a voltage within the range provided for in paragraph 8.6.4 'Voltage' of the Tasmanian Electricity Code.
ii     To provide electricity in accordance with paragraph 8.7(a) 'Safety and Other Manuals' of the Tasmanian Electricity Code.
9On 10 December 2010 good electricity industry practice, as defined in the Tasmanian Electricity Code, for the supply of electricity in Australia complies with:-
a)     AS 2067:2008 being the applicable Australian Standard for the design and erection of electrical power installations.
b)    AS 7000:2010 being the applicable Australian Standard for the determination of separation between different power circuits on the same support (attached crossing).
c)     The Energy Networks Association Code ENA 007:2006 Section 5.10.4 specifying 280 mm clearance lines to earth for a 24 kV highest system voltage.
d)    AS 2067:1984 being the applicable Australian Standard for earth matting.
e)     Any relevant engineering drawing(s) prepared by the Defendant or its predecessors in title including HEC Drawings B12335 and B14731.
f)     Inspection of overhead lines for component defects pursuant to Aurora Procedure 'Identification and Management of Overhead Line Defects' NP RAM03
10Accordingly, the scope of the Hydro Electric Commission and Aurora Energy Pty Ltd's duty to the Plaintiff in the supply and distribution of electricity to the property required it to:-
a)     Install an earthing system at the pole in accordance with AS2067:2008 and Drawing BI4731 with sufficient separation of HV and LV earth systems such that danger to persons or equipment could not occur in the low voltage installation as a result of an HV fault or surge and described in Drawing BI4731 at 2m.
b)    Install an earthing system at the pole in accordance with AS2067:2008 with an earth resistance value such that the rise of voltage of the earthing system is less than 2000V above true earth potential.
c)     Install the pole with a clearance distance between the transformer HV bushing and the LV conductor of not less than 280 mm, and to fail to ensure from November 1989 that there was a minimum 310mm clearance between the HV and LV conductors.
d)    Maintain a minimum separation on the pole between phase and earth of 220 mm for a BIL of 125 kV and 280 mm for a BIL of 145 kV.
e)     Supply and install bare and unpainted arc gap rods on the pole.
f)     Install arc gap rods on the pole with the correct separation as provided in Drawing Bl2335 of 50mm in series.
g)     Ensure that the pole complied with the accepted industry practice and Drawing B14731 that the resistance of the HV and LV earthing systems not exceed 30 ohms.
h)    Provide, in accordance with AS 2067:1984, an earthing system on the pole for both HV and LV of sufficiently low resistance.
i)     Provide earthing systems on the pole for both HV and LV either:
iin accordance with AS 2067:1984; or,
iiin accordance with AS 2067:2008.
j)     Inspect overhead lines for component defects every three (3) years.
11At diverse times during fault or surge events between approximately 1988 and 2012, but more particularly on 10 December 2010, the voltage to the property exceeded the range permitted by the Tasmanian Electricity Code.
12On 10 December 2010 the pole did not comply with paragraph 8.7(a) of the Tasmanian Electricity Code.
13On 10 December 2010 the clearance between the transformer HV bushing and the LV conductor on the pole was approximately 110 mm.
14On 10 December 2010 the arc gap rods on the pole were covered in paint.
15On 10 December 2010 the left hand side bushing on the pole had a misaligned arc gap rod thereby creating an incorrect separation of 15mm in series and the right hand side arc gap rod had an incorrect separation of 10mm in series
16On 10 December 2010 the resistance of the HV earthing system fitted to the pole was approximately 97 ohms.
17On 10 December 2010 the earthing system for the pole was not in accordance with:
a)     AS 2067:1984; or,
b)    AS 2067:2008.
18Each of the matters pleaded in paragraphs 11 to 17 inclusive constituted a negligent breach of duty by the Defendant.
PARTICULARS OF NEGLIGENCE
i    The high voltage entered the low voltage system at or around the pole.
ii   On 10 December 2010 the method by which high voltage electricity entered the low voltage system was by one or both of the following mechanisms:-
·Transfer of high voltage electricity within the transformer attached to the pole ('the transformer') from the HV transformer bushing to the LV active 'a' conductor; and/or,
·Transfer of high voltage electricity from the HV earthing system to the LV earthing system by way of induced voltage during a fault or surge event.
The mechanisms referred to above were caused by one or more of the following negligent acts or omissions of the Defendant:
·The pole was poorly designed and installed by the Defendant (formerly the HEC) and not in accordance with the required standards causing the HV transformer bushing to be within 220mm (presuming BIL of 125kV) of the LV active 'a' conductor; namely 110mm. This incorrect proximity increases the likelihood of high voltage electricity entering the low voltage system of the Plaintiffs premises causing damage.
·The spark gaps of the transformer right hand side HV bushing were misaligned. The spark gaps were approximately 60 mm in series when Hydro Electric Commission ('HEC') diagram B12335 required a separation of 25mm for each spark gap. This incorrect separation reduced the effectiveness of the transformer HV earthing system and increases the likelihood that electricity, following the path of least resistance, would enter the LV system in order to find a less resistive earth.
·The arc gap rods on the transformer right hand HV bushing were painted. Drawing B12335 does not prescribe painted rods. Further, it is not good electricity industry practice for arc gap rods to be painted because even a thin layer of paint has the effect of reducing the effectiveness of the rods when operation is required in a fault or surge event leading high voltage electricity to find less resistive paths to earth than otherwise designed.
·The HV and LV earthing system electrodes were placed approximately 300mm apart. By placing earth electrodes closer than is permitted in AS 2067:1984 or AS2067:2008 or Drawing B14731 it was possible for high voltage during a fault or surge event to become induced into the LV earthing electrode at a sufficient voltage as to cause damage to the Plaintiffs plant and equipment.
·The earthing system of the pole was not sufficient to yield a resistance value of less than 30 ohms as required by relevant standards and HEC drawing B14731. The resistance of the HV earthing system for the transformer was approximately 97 ohms as measured by the Defendant. The high resistance of the HV earthing system increased the likelihood that electricity, following the path of least resistance, would enter either the LV earthing system by way of induction or cause an 'arc!' or 'flash' from the transformer right hand HV bushing to the LV active 'a' conductor allowing dangerously high voltage during a fault or surge event to travel from the pole to the Plaintiffs premises causing damage to plant and equipment.
·Failure to identify and/or report and/or prioritise and/or attend to the defects referred to in paragraph 18(i) of this Statement of Claim.
19 By reason of one or more of the matters pleaded in paragraph 11 to 17 inclusive, high voltage entered the low voltage system supplying the property and caused harm.
PARTICULARS OF HARM
The harm was caused on or about 10 December 2010 by voltage exceeding the maximum permitted by the Tasmanian Electricity Code for a 240V installation entering the 240V circuits of the Plaintiffs premises by reason of one or more of the mechanisms and factors particularised above.
The harm was the destruction of a Mitsubishi FX2N Programmable Logic Controller ('PLC') that was used to operate a Demtec Potting Machine and Potting Robot.
The PLC sustained catastrophic damage to internal components due to a power surge which caused the PLC (and thus the Demtec equipment) to fail to operate.
20 In the event it is found that none of the alleged breaches were a necessary element of the occurrence of the harm, this is an exceptional case within the meaning of Section 13(2) of the Civil Liability Act 2002.
PARTICULARS
a)The only causative factors relate to breach of duty.
b)All the breaches of duty were imposed on the Defendant and no other party.
c)As a matter of common sense one or more of the Defendant's breaches caused the damage.
21 For the purposes of deciding the scope of liability (pursuant to Section 13(4) of the Civil Liability Act 2002) the responsibility for the harm suffered by the Plaintiff should be imposed on the Defendant for the following reasons:-
a)The Defendant had a statutory responsibility to supply electricity.
b)The supply of electricity is essential.
c)The supply of electricity is dangerous.
d)The negligent supply of electricity can cause injury, death and/or damage to property.
e)The Plaintiff relies on the Defendant to design, install and maintain infrastructure and to supply electricity in a safe manner.
f)The Defendant has significant experience in the operation of an electricity distribution network.
g)The Defendant has significant resources at its disposal to ensure compliance with its statutory and common law duties."
It can be seen that in the amended statement of claim, the appellant pleaded details of the relationship between it and the respondent, the statutory transfer of the liabilities of the HEC and Aurora to the respondent, the facts relied upon as the basis of its contentions as to how HV electricity entered the LV system, its suffering of harm, and the causation of that harm. However the amended statement of claim did not contain an express assertion that the HEC and Aurora owed the appellant common law duties requiring them to take reasonable care to prevent HV electricity from entering the LV system or any similar duties.
The learned trial judge concluded that, because of that omission, no cause of action in negligence had been pleaded. The respondent contends that he was correct. The appellant contends that he was incorrect, and that the express pleading of such duties was unnecessary. It contends that it was sufficient for it to plead only the facts giving rise to common law duties of care, as distinct from the existence of the duties. It contends that its reliance on the tort of negligence as a basis for its claim for damages was made clear in par 18 of the pleading which read, "Each of the matters pleaded in paragraphs 11 to 17 inclusive constituted a negligent breach of duty by the Defendant", and then set out detailed "particulars of negligence".

Counsel for the respondent submitted from the beginning of the trial that negligence had not been pleaded. The reasoning of the learned trial judge that led to him upholding that submission can be summarised as follows:
·     At [72] he said, "The pleadings omit a statement, expressly pleaded or by reference to some other aspect of the pleadings, of the legal relationship relied upon for the purposes of establishing a duty of care in common law."
·     At [73] he observed, "The existence of a statutory duty can never be a sufficient basis on its own for the creation of a common law duty of care. There will always be some other element, such as obligations flowing from a relationship between the parties ...".
·     At [71] and [74], he treated par 18 as pleading only breaches of statutory duties. At [74] he said, "... merely adding the label 'negligent' does not elevate a reference to them to the pleading of an action in negligence".
·     At [75], he accepted a submission made by counsel for the respondent to the effect that the pleading did not make clear whether an established duty or a novel one was being asserted.
·     At [66], he expressed the view that the Civil Liability Act 2002 requires a pleading to address "the duty, and the scope of the duty". He distinguished my decision in Jones v Clyde Welshpool Pty Ltd [2000] TASSC 130, 9 Tas R 391. I held in that case, at [9], that "a statement of claim is quite capable of disclosing a cause of action in negligence if only the facts alleged to give rise to a duty are pleaded, and no assertion is made as to the existence of any duty". His Honour distinguished that case on the basis that it predated the Civil Liability Act.
There is nothing in the Supreme Court Civil Procedure Act 1932, the Supreme Court Rules 2000 or the Civil Liability Act that expressly requires a plaintiff to plead anything as to the existence or scope of an asserted duty of care. Rule 227(1)(b) of the Supreme Court Rules requires a pleading to "contain only a statement of all the material facts in summary form on which the party relies but not the evidence by which those facts are to be proved". Rule 227(3) says that "Every pleading is to be expressed so as to give reasonably explicit notice to any other party of all grounds of action ... on which the party pleading intends to rely at the trial."
As a general rule, because a plaintiff is required only to plead facts that show an entitlement to relief, there is no need to plead conclusions of law. That has been the situation ever since the adoption of the Judicature Act system of pleading. Thus, in Konskier v B Goodman Limited [1928] l KB 421, Scrutton LJ, with whom Sargent and Greer LJJ agreed, said, at, 427:
"But a plaintiff is not now bound to state the legal effect of the facts on which he relies; he is only bound to state the facts themselves ...".
I followed that case in Jones v Clyde Welshpool Pty Ltd (above).
Statements of claim often contain paragraphs in which asserted duties of care are pleaded and carefully defined. The inclusion of such a paragraph is often a good idea. Sometimes it is essential in order to give the defendant "reasonably explicit notice" of the basis of the plaintiff's claim, as required by r 227(3).
The only relevant provisions in the Civil Liability Act concerning a duty to take reasonable care are ss 11 and 12. Those sections read as follows;
"11(1) A person does not breach a duty to take reasonable care unless —
(a)there was a foreseeable risk of harm (that is, a risk of harm of which the person knew or ought reasonably to have known); and
(b)the risk was not insignificant; and
(c)in the circumstances, a reasonable person in the position of the person would have taken precautions to avoid the risk.
(2) In deciding whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (among other relevant things):
(a)the probability that the harm would occur if care were not taken;
(b)the likely seriousness of the harm;
(c)the burden of taking precautions to avoid the risk of harm;
(d)the potential net benefit of the activity that exposes others to the risk of harm.
(3) For the purpose of subsection (2)(c), the court is to consider the burden of taking precautions to avoid similar risks of harm for which the person may be responsible.
12 In a proceeding relating to liability for breach of duty —
(a)the fact that a risk of harm could have been avoided by doing something in a different way does not of itself give rise to or affect liability for the way in which the thing was done; and
(b)the subsequent taking of action that (had the action been taken earlier) would have avoided a risk of harm does not of itself give rise to or affect liability in relation to the risk and does not of itself constitute evidence of liability in connection with the risk."
In my view the enactment of those sections has not made it necessary for plaintiffs always to plead matters relating to each paragraph of s 11. That is because the Civil Liability Act did not change the ingredients of a cause of action for negligence. The facts relied upon by the appellant in this case were what it had to plead, and the relevant sections made no difference as to what facts were material. It will often be sufficient for a plaintiff to plead that the defendant was negligent, and to provide particulars of negligence listing the acts and omissions that are said to have constituted negligence, or breaches by the defendant of a duty of care. That is what the appellant did in this case. Its assertion in par 18 of the pleading that each of several pleaded matters "constitute a negligent breach of duty" and its provision of particulars of negligence were sufficient, in the words of r 227(3), to give the respondent "reasonably explicit notice ... of all grounds of action" on which it intended to rely at the trial.
Ground 1 must succeed. It is as plain as day that a cause of action in negligence was sufficiently pleaded.

Duties of care

At the trial, the following matters, amongst others, were agreed between the parties:
·     The HEC generated, transmitted and distributed electricity in Tasmania until 1 July 1998 when, pursuant to a notice under the Electricity Companies Act 1997, all assets, rights and liabilities in respect of the distribution business of the HEC were transferred to Aurora.
·     On 1 July 2014, pursuant to a notice under the Electricity Reform Act, all assets, rights and liabilities in respect of Aurora's distribution business passed to the respondent.
·     In each notice, "distribution business" referred to the "poles and wires" transferring HV and LV electricity from sub-stations to residential homes and small businesses.
·     The HEC "dressed and installed" the pole in or around 1987.
·     The transformer on the pole was installed as part of the original installation and had not been replaced.
·     In 1998 the appellant leased the property at Winkleigh.
·     In May 2002 it purchased the property.
It was common ground that the respondent did not assume responsibility for any of the liabilities relating to the generation of electricity, as distinct from its distribution, by the HEC or Aurora.
The dangers relating to electricity have been well known for many years. They were perhaps less well known in 1850 when, according to some sources, William Gladstone, then the Chancellor of the Exchequer, asked Michael Faraday what practical value electricity had, and was told, "Why, sir, there is every probability that you will soon be able to tax it." Judicial notice can now be taken of the fact that electrocution can cause death or serious injury, and of the fact that electrical equipment can be damaged or destroyed by the transmission of electricity at too high a voltage.
There is no shortage of cases in which entities responsible for the transmission or distribution of electricity have been held to have owed duties of care to persons who might suffer harm as a result of electrocution or damage to electrical equipment.
Thompson v Bankstown Corporation (1953) 87 CLR 619 concerned a boy who climbed an electricity pole to try to reach a bird's nest and received an electric shock from an earth-wire. The Bankstown Corporation conducted an electricity undertaking, distributing electricity throughout its municipality. The High Court held that it owed the boy a duty of care because its exercise of statutory powers involved something dangerous. Submissions that the case should be decided on the basis that the boy was a trespasser upon the corporation's structure were rejected. Dixon CJ and Williams J said, at 629:
"But it appears to us to be an artificial and unreal view of the situation in the present case to treat it as depending on the extent of the defendant's duty arising from the possession of the pole.
The generation, or receipt, and transmission of electrical energy of a lethal voltage imposed the duty upon the defendant. By statute, as we assume, the defendant was authorized to bring it upon the highway. But a duty of care rested upon the defendant of a high degree; a duty of care measured by a high standard both because of the lethal nature of the agency and because of the almost infinite variety of mischance by which attempts to insulate it and prevent its escape may be defeated. Obvious as it may be, it is necessary to remember that the elevation of the high tension transmission wires upon poles is the first step in discharging that duty. That is the purpose and function of the pole upon which the vertical wire remained that brought disaster to the plaintiff."
McTiernan J said, at 634:
"The defendant's liability ... arises because it was under a duty to take reasonable care while maintaining upon a public road poles and wires for the transmission of electricity of a very dangerous voltage."
Kitto J said, at 645:
"Now the appellant, as a member of the public using a road along which the respondent was engaged in transmitting its electric power, was one to whom injury might reasonably be foreseen as a likely consequence of any omission on the part of the respondent to take reasonable care in the management of its electricity; and, that being so, there clearly was a relation between the parties by reason of which it was the respondent's duty to take reasonable care to safeguard the appellant against the consequences of any such omission."
That case was followed in Munnings v Hydro-Electric Commission (1971) 125 CLR 1. That case also concerned a boy who climbed an electricity pole and was accidentally electrocuted. At 11, Barwick CJ held that Thompson was "an authority for the proposition that a person bringing such a substance as electricity into proximity of the public owes a duty to take care by the adoption of reasonable steps or methods that it does not harm those whom it ought to foresee might otherwise come into contact with it". Menzies and Windeyer JJ also took that view.
Counsel for the respondent argued that the appellant's claim did not fall within any accepted category of duty, and that it was therefore necessary to undertake an analysis of the "salient features" of the relationship between the parties in order to determine whether there was a duty of care. It is certainly correct that such an analysis is necessary when the circumstances of a case fall outside any accepted category of duty: Perre v Apand Pty Ltd [1999] HCA 37, 198 CLR 180 at [198]; Graham Barclay Oysters Pty Ltd v Ryan [2002] HCA 54, 211 CLR 540 at [149], [243]. In the light of the High Court's decisions in Thompson and Munnings it is clear that the duty of an entity that transmits electricity to persons who might foreseeably suffer harm as a result of the transmission of electricity in an unintended way is an accepted category of duty.
Of course this case concerns damage to property, whereas Thompson and Munnings both concerned personal injuries. A cause of action in respect of property damage is not the same cause of action as one relating to personal injury caused by the same negligence: Brunsden v Humphrey (1884) 14 QBD 141. However there is no reason to distinguish Thompson and Munnings on that basis. The precautions that an electricity distributor needs to take in order to discharge its duty to take reasonable care to prevent the electrocution of individuals are the same precautions that need to be taken to prevent damage to electrical equipment. If HV electricity enters an LV system, there is not just a risk that electrical equipment will be damaged, but also a risk that anyone using or touching electrical equipment will be electrocuted. It follows that the duty of an entity that transmits electricity that is owed to persons who might foreseeably suffer harm as a result of the transmission of electricity in an unintended way is an accepted category of duty that relates not just to personal injury, but also to property damage.
If I am wrong about that, I think that an analysis of the salient features of the relationship between the parties compels a conclusion that the HEC and Aurora owed the appellant a duty to take reasonable care to prevent property damage resulting from the transmission of electricity at an unintended voltage.
I say that because of the following facts and circumstances:
·     The HEC and Aurora were responsible at all material times for the distribution of electricity to the consumers of electricity throughout Tasmania.
·     The consumers of electricity from their network included the proprietors of many small businesses in which electrically powered machinery was used.
·     The appellant is and was the proprietor of a small business using electrically powered machinery.
·     It is generally known that electrically powered machinery is invariably designed to operate at a particular voltage or range of voltages.
·     The appellant's claim relates to damage to its electrically operated machinery caused by the transmission of electricity at too high a voltage for certain of its machinery to withstand, and for consequential losses.
·     The HEC and Aurora installed, maintained and controlled the infrastructure through which electricity was transmitted to the appellant's property, including the pole, the transformer and equipment on it, the cables bringing HV electricity to it, and earthing cables connected to it.
·     The appellant relied on Aurora to supply electricity at such a voltage that its machinery would work and not be damaged or destroyed.
·     The appellant was vulnerable to harm to its machinery. As the proprietor of a nursery business it had little or no capacity to protect its equipment from power surges. It was not reasonable in the circumstances to expect it to take steps to protect itself against power surges.
·     If a surge of HV electricity entered the appellant's LV system, there was not just a risk that the appellant's electrical equipment would be damaged, but also a risk that anyone using or touching that equipment might be electrocuted.
·     The evidence at the trial established that the HEC and Aurora routinely took steps to obviate the risk of power surges in the design and installation of transformers. In particular, they routinely installed and designed transformers maintaining safe distances between bushings and consumers' LV conductors, by ensuring that the gaps between spark gap rods were small enough to eliminate the risk of flashovers to consumers' LV conductors, and by maintaining safe distances between the uninsulated sections of HV and LV earthing conductors.
·     The cost of taking steps to obviate the risk of the appellant's machinery being damaged by a power surge was modest.
·     The harm that a power surge could potentially cause to the appellant was substantial, particularly because of the risk of an interruption to its business causing substantial financial loss.
·     There was no potential indeterminacy of liability since the duty asserted was a duty to a single electricity consumer who was the sole consumer of electricity from a single pole.
·     The imposition of the asserted duty would not interfere with the right or ability of the respondent to discharge its duties under the relevant legislation.
For these reasons it is very clear that the HEC and Aurora owed the appellant duties to take reasonable steps to protect the appellant's machinery from damage from power surges.

The pure economic loss issue

Counsel for the respondent submitted that the appellant's claim should be characterised as a claim for pure economic loss, not as a claim in respect of property damage and consequential losses. I disagree.
Damages for pure economic loss are not recoverable if all that is shown is that the defendant's negligence was a cause of the loss and the loss was reasonably foreseeable: Woolcock Street Investments Pty Ltd v CDG Pty Ltd [2004] HCA 16, 216 CLR 515 per Gleeson CJ, Gummow, Hayne and Heydon JJ at [21]. It was held in Caltex Oil (Australia) Pty Ltd v The Dredge "Willemstad" (1976) 136 CLR 529 that, as a general rule, damages are not recoverable for economic loss which is not consequential upon injury to person or property, even if the loss is foreseeable. However, as Gibbs J said in that case at 544, "... it is clearly settled that where personal injury or physical damage to property has been caused by a negligent act, the damages which may be recovered include compensation for all pecuniary loss suffered as a result of the injury or damage."
The appellant's case was that the negligence of the HEC and Aurora resulted in a power surge which damaged its PLC, causing an interruption to its production and substantial economic loss. Its claim included components for a loss of profits, borrowing costs, a liability to refund money to an insurer, and interest.
Its claim as pleaded did not include a component in respect of damage to the PLC. That does not affect the way in which its claim should be categorised. It is a claim for pecuniary loss suffered as a result of physical damage to property. This is not a case in which a claim is defeated by the common law rule as to pure economic loss.

Circumstantial evidence (Ground 2)

In his reasons at [110]-[260] the learned trial judge undertook an analysis of the appellant's case as to causation. He considered various aspects of the evidence in isolation from one another, and made a series of findings that were favourable to the respondent, as follows:
·     His Honour considered the evidence of numerous incidents from 2003 until 2011 when there were interruptions to the appellant's power supply associated with electrical appliances failing or being damaged. At [153] he concluded that he was not able to draw any inference from those episodes.
·     At [155] his Honour said that he afforded no weight to the evidence about those interruptions to the power supply and the damage sustained by electrical appliances.
·     As to the hypothesis that HV electricity could have passed through the ground from an HV earthing conductor to an LV earthing conductor, his Honour said at [173] that that issue required the Court to be satisfied that the appellant had proved on the balance of probabilities that the earthing system resistance was greater than 30 ohms on 10 December 2010, and that uninsulated earth wires were located less than two metres apart. At [178], his Honour concluded that he was not satisfied on the balance of probabilities that on that date the earthing system resistance was greater than 30 ohms, and continued, "It follows that the Court is not satisfied that the harm could have been caused by a mechanism which relies upon this fact."
·     At [191] his Honour concluded that he was not satisfied that the location of the earth wires, as alleged, was established. He made a finding to the effect that the passing of electricity from the HV earth wire to the LV earth wire as hypothesised was possible, but that the evidence established only that it was possible. He continued, "As such the existence of that fact does not go beyond conjecture, and is not sufficient to establish the matters on the balance of probabilities."
·     At [192], he said, "It follows that the causation mechanism based upon the earths is not established; it is not open to the Court to find that the location of the earth wires could have caused the harm."
·     At [201], his Honour made a finding that it was possible that HV electricity had entered the LV system as the result of a flashover event, but he went on to conclude that the appellant had not proved that that had occurred. He said, "The evidence led by the plaintiff goes no further than to establish that it is possible. The court finds that the existence of these facts is not proved; it is mere conjecture. It is not sufficient to establish the matters relied upon, on the balance of probabilities."
·     At [202], his Honour noted that the parties had agreed that the right hand spark gap was 60 mm in series, and accepted that the left hand spark gap was 65 mm in series. At [203], his Honour said he was satisfied that, with that configuration, there was a mechanism through which an HV surge could find its way to the LV pathway. However he held that he was not satisfied that the appellant had proved that there was such an event.
·     At [204], his Honour considered the state of the evidence as to the painting of an arc gap rod. He concluded that he could not be satisfied that, by reason of the painting of the arc gap rod, there was a mechanism through which causation might be established.
·     At [211], his Honour said that he was satisfied, on the basis of the respondent's expert evidence, supported by the modelling evidence from one of its expert witnesses, Dr Muthumuni, that the appellant had not established a surge event of the magnitude alleged, nor that the respondent's acts or omissions were a necessary element of the harm to the PLC. He went on to set out his reasons for that conclusion at [212]-[258], referring in detail to the evidence of the parties' expert witnesses. At [259] he repeated his conclusion that the appellant had "not established on the balance of probabilities that there was a high voltage surge event in December 2010 which damaged the PLC".

The proper approach to a case based on circumstantial evidence is as stated by Lord Cairns in Re Belhaven and Stenton Peerage (1875) 1 App Cas 278 at 279:
"… in dealing with circumstantial evidence, we have to consider the weight which is to be given to the united force of all the circumstances put together. You may have a ray of light so feeble that by itself it will do little to elucidate a dark corner. But on the other hand, you may have a number of rays, each of them insufficient, but all converging and brought to bear upon the same point, and, when united, producing a body of illumination which will clear away the darkness which you are endeavouring to dispel."
The case law as to wholly circumstantial civil cases was usefully summarised by Porter J in Langmaid v Dobsons Vegetable Machinery Pty Ltd [2014] TASFC 6, 24 Tas R 18 at [119]-[126]. The following propositions were made clear by his Honour's analysis:
·     "Where circumstantial evidence is relied upon, it is not in general necessary that all reasonable hypotheses consistent with the non-existence of a fact, or inconsistent with its existence, be excluded before the fact can be found". "A rational choice between competing hypotheses, informed by a sense of actual persuasion in favour of the choice made, will support a finding, on the balance of probabilities, as to the existence of the fact in issue." Nguyen v Cosmopolitan Homes (NSW) Pty Ltd [2008] NSWCA 246 per McDougall J (with whom McColl and Bell JJA agreed) at [55].
·     "All that is necessary is that according to the course of common experience the more probable inference from the circumstances … should be that the injury arose from the defendant's negligence. By more probable is meant no more than upon a balance of probabilities such an inference might reasonably be considered to have some greater degree of likelihood." Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 at 6.
·     "Evidence of possibility is capable of supporting a probative inference, and expert evidence of possibility may, as circumstantial evidence, alone or in combination with other evidence, establish causation": Langmaid, per Porter J at [124], citing Seltsam Pty Ltd v McGuiness [2000] NSWCA 29, 49 NSWLR 262 per Spigelman CJ at [89]; McDonald v Girkaid Pty Ltd [2004] NSWCA 297, Aust Torts Reports 81-768, per McColl JA (with whom Beazley JA and Young CJ in Eq agreed) at [104].
In Langmaid, the appellant's case was that "hot work" undertaken by the respondent had caused a fire. There were two other possibilities that had to be considered, namely a possibility that the fire was not caused by hot work at all, and a possibility that it was caused by hot work undertaken by an employee of one of the appellants. At [126], Porter J indicated that it was necessary to acknowledge "the combined strength of the possibilities that the fire was not caused by hot work at all, and that it was caused by the hot work of the first appellant's employee". Similarly, in this case, it is necessary to evaluate the "combined strength" of the possibilities asserted by the appellant.
That is not what the learned trial judge did. At the beginning of the passage in his reasons relating to causation, he said, at [157], "Each of the factual matters upon which the plaintiff relies to prove causation must be proved by it on the balance of probabilities". His Honour seems to have regarded it as axiomatic that proof of causation in this case required the identification of at least breach of duty that was established on the balance of probabilities to have caused or materially contributed to the appellant's damage. Similarly, counsel for the respondent, in their submissions to this Court, appear to have regarded that as axiomatic. The respondent's submissions as to causation appear to assume that a claim for damages for negligence cannot succeed without the claimant establishing on the balance of probabilities that there has been both a breach of a duty of care and a suffering of harm resulting from that particular breach. However the appellant's contentions are based on the premise that, where there are pieces of circumstantial evidence akin to strands in a cable, it is sufficient to establish on the balance of probabilities that there were breaches of duty, that harm was suffered, and that the harm must have resulted from one or more breaches of duty, even if no individual breach of duty can be identified as causative.
This is no ordinary case. I have been unable to find any civil case in which findings have been made as to multiple breaches of duty, damage resulting from one or more of those breaches of duty, and insufficient evidence for the causative breaches to be established. There are certainly cases that stand for the proposition that a plaintiff does not need to establish precisely how an injury was suffered: Hamilton v Nuroof (WA) Pty Ltd (1956) 96 CLR 18 at 23-24; Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11, 243 CLR 361 at [53]-[54]; Duma v Mader International Pty Ltd [2013] VSCA 23, 42 VR 351 at [3]; Langmaid v Dobsons Vegetable Machinery Pty Ltd (above) at [141]. However those cases did not involve distinct breaches of duty, competing possible causes of harm, and a shortage of evidence pointing to one or more particular causes.
A criminal case involving multiple possible causes of harm has been considered by the English Court of Appeal: Attorney-General's Reference (No 4 of 1980) [1981] 1 WLR 705. That reference related to the trial of a man who was acquitted on a charge of manslaughter. The Crown alleged that he had killed a woman, but the woman's body was never found. On the evidence there were three possible causes of death. She might have died as a result of the accused pushing her and causing her to fall and hit her head, or as a result of the accused strangling her with a rope, or as a result of him cutting her throat. The trial judge held that the Crown bore the burden of proving beyond reasonable doubt which act caused the woman's death, and that the evidence was insufficient for the jury to be satisfied beyond reasonable doubt that any particular act was the cause of death. He therefore directed an acquittal. Ackner LJ, reading the opinion of the Court of Appeal, said, at 710:
"... this reference raises a single and simple question, viz: if an accused kills another by one or other of two or more different acts each of which, if it caused the death, is a sufficient act to establish manslaughter, is it necessary in order to found a conviction to prove which act caused the death? The answer to that question is 'No, it is not necessary to found a conviction to prove which act caused the death'. No authority is required to justify this answer, which is clear beyond argument ...".
For a jury to convict on circumstantial evidence alone in a criminal case "the circumstances must exclude any reasonable hypothesis consistent with innocence": Chamberlain v The Queen (No 2) (1984) 153 CLR 521 per Gibbs CJ and Mason J at 536. There is nothing in that principle that requires a jury to conclude that an accused person committed the crime charged in a particular manner when the evidence leaves open the possibility that the accused committed the crime in two or more ways, each of which are consistent with guilt.
In civil cases, when harm is shown to have resulted from one or more breaches of duty by a tortfeasor, and there is uncertainty as to which breach of duty caused the harm, it would be extremely unjust if plaintiffs were required to establish on the balance of probabilities which particular tortious act or acts resulted in the harm. It would be most unjust if a tortfeasor could escape liability as the result of a plaintiff being unable to discharge such a burden. A plaintiff might establish on the balance of probabilities that he had suffered damage as the result of a defendant's negligence, but recover no damages because there were two or more breaches of duty that could have caused the harm, and no individual breach of duty could be identified as causative. Furthermore, tortfeasors committing multiple distinct and varied breaches of duty would enjoy an advantage not shared by tortfeasors responsible only for single breaches of duty.
A number of the leading cases about causation in the law of negligence contain statements of principle which, at face value, might be taken to suggest that a plaintiff bears the burden of establishing causation by a particular breach of duty. For example, in Chappel v Hart (1998) 195 CLR 232 at [23], McHugh J said that "causation theory insists that the plaintiff prove that the injury is relevantly connected to the breach of duty". However such pronouncements should not be taken out of context and treated as authority in relation to a point of law that they were not intended to relate to.
As a matter of principle, if a plaintiff establishes on the balance of probabilities that a defendant owed him duties of care, and breached them, and that he suffered damage as a result of the plaintiff breaching such duties, then that plaintiff must be entitled to recover damages, even if it is not possible to establish on the balance of probabilities which breaches were causative. It follows that the learned trial judge was required to treat this case as a "strands in a cable" case, and to assess the combined strength of the possibilities that the appellant's damage had been caused by the various asserted breaches of duty on the part of the HEC and Aurora. By considering the evidence as to each asserted breach of duty in isolation from the evidence as to the other asserted breaches, his Honour erred in the manner asserted by ground 2 of the notice of appeal.
It does not follow that this appeal should necessarily succeed. Like Estcourt J, I take the view that the most appropriate course is for this Court to undertake its own assessment of the circumstantial evidence and reach a conclusion as to whether negligence has been established on the balance of probabilities. In deciding upon that course, I consider it very significant that the learned trial judge accepted that all the expert witnesses at the trial were honest and appropriately qualified. His only findings as to preferential evidence were based on some experts being more experienced than others.

The HV bushing to LV conductor flashover hypothesis

In simple terms, one of the transformer components carrying HV electricity on the pole was too close to one of the cables that carried LV electricity from the pole towards the appellant's premises.
The pole is connected to the appellant's premises by three cables. Two of them are designed to be live or "active". They are known as the "a" conductor and the "b" conductor. The third cable is the "earth" cable.
The position of the transformer on the pole is close to the "a" conductor and the "b" conductor. On the outside of the transformer there are two bushings. There are wires that connect each bushing to the overhead HV wires. HV electricity passes through each bushing. When transformers are installed on poles, it is important for the HV bushings and the LV conductors to be separated by a sufficient distance to avoid the risk of HV electricity flashing over from a bushing and entering the LV system.
The pole was installed by the HEC in 1987. The then applicable Australian Standard, AS2067-1984, in Table 9.1, specified a minimum clearance of 280 mm between an HV bushing and an LV conductor. In 1989 the HEC introduced a requirement that there be a minimum clearance of 310 mm. Subsequently another Australian Standard, AS2067-2008, introduced a requirement that there be a separation of 280 mm plus 15%. That amounts to 322 mm. In its amended statement of claim, the appellant pleaded that on 10 December 2010 the clearance was approximately 110 mm. That was admitted. At the trial, all the experts who gave evidence as to the point were in agreement that the actual clearance was less than the minimum safe clearance.
It must follow that the HEC breached its duty of care when it installed the pole in or around 1987 with too little separation between the bushing and the "a" conductor. Evidence at the trial established that employees of the HEC inspected the pole in September 1993 and December 1997, and that employees of Aurora inspected the pole in July 2001, February 2004, December 2006 and June 2010. The individuals carrying out each inspection either observed or ought to have observed the inadequate separation. Work should have been undertaken to obviate the risk of a flashover from the bushing to the "a" conductor. Aurora breached its duty of care by failing to undertake that work between 1 July 1998, when it took over from the HEC, and 10 December 2010.
As at that date there was no insulation on the "a" conductor. There was evidence at the trial that insulation was often installed on sections of such conductors adjacent to poles in order to obviate the risk of flashovers. In fact Aurora installed insulation on a short section of the "a" conductor adjacent to the pole in January 2012. The appellant did not plead that the HEC or Aurora was negligent in failing to install insulation on that conductor. However the absence of insulation on it means that the likelihood of a flashover from the HV bushing to it on 10 December 2010 was significantly greater than it otherwise would have been. That is a factor that weighs in the appellant's favour in the assessment of the strength of the circumstantial evidence.
As I have said, the learned trial judge made a finding, at [201], to the effect that it was possible that there had been a flashover from the bushing to the "a" conductor. That finding has not been challenged by the respondent. However there was evidence from the respondent's expert witnesses at the trial that they believed that no such flashover had occurred, for a number of reasons. It was said that a flashover would be likely to have left visible evidence of damage to the hardware on the pole, but no such visible evidence was found. It was said that such a flashover would have blown certain fuses located on the pole, but they did not blow. It was said that a power surge from such a flashover would have damaged electrical items in the house at the appellant's property, but not the PLC, which was further away from the pole, but there was no damage to items in the house and there was damage to the PLC. It was said that modelling of the likely consequences of the operation of the recloser at Glengarry, which was undertaken by suitably qualified experts including Dr Muthumuni showed that it was unlikely, at the least, that the result would be a power surge of sufficient strength and duration to reach and damage the PLC. All of those propositions will have to be considered when I assess the likelihood of the damage to the PLC having been caused in one or more of the ways relied upon by the appellant.

The spark gap flashover hypothesis

There are electrodes on the transformer that are known as spark gap rods or arc rods. Their purpose is to ensure that, in the event of an electrical surge, electricity is able to pass into the ground travelling along earth wires, to avoid the risk of damage to electrical appliances and/or individuals. Transformers are designed with spark gap rods positioned so that, in the event of a surge, electricity will arc across from one rod to another, and then continue along earth wires into the ground. The appellant contended that, as a result of negligence on the part of Aurora and the HEC, the spark gap rods on the pole were too far apart, and one of them was painted. The appellant contended that the paint made it less likely that electricity would pass from the painted rod as intended in the event of a power surge.
The design of the transformer appears in an HEC drawing numbered B12335 which was tendered on the trial. The transformer was designed to have arc gaps of 50 mm in series on the right and left sides on the pole. As at 10 December 2010, there was a separation of 65 mm in series on the left and a separation of 60 mm in series on the right. Those measurements were admitted on the pleadings. In these respects, the transformer was not constructed as designed. That failure created a risk that, in the event of a power surge, the arc rods would not do their job, and electricity would pass along an LV cable instead of going to earth.
It was admitted on the pleadings that the arc gap rods were covered in paint. There was no evidence of the thickness of the paint. The evidence suggested that the arc rods were painted by the supplier, not by the HEC or Aurora. The appellant led expert evidence that the paint would be likely to inhibit the operation of the arc gap rods in the event of a power surge.
I am satisfied that the HEC breached its duty of care by installing the transformer with arc gap rods that were incorrectly positioned. I need not make a finding as to whether the HEC or Aurora were negligent in failing to detect and rectify the incorrect positioning.
As I have said, the learned trial judge made a finding, at [203], to the effect that, because of the configuration of the spark gaps, there was a mechanism through which an HV surge could find its way to the LV "pathway". That finding has not been challenged in this appeal.
Again, the respondent relied on evidence from its expert witnesses that any flashover would be likely to have left visible evidence of damage to the hardware on the pole, that a power surge from any flashover would have damaged electrical items in the house rather than the PLC, and that modelling showed that it was unlikely, at the least, that there would have been a power surge of sufficient strength and duration to reach and damage the PLC.

The earth wires hypothesis

The transformer had an earthing system. Two earth wires ran down the transformer and into the ground – an HV earth wire on one side of the pole, and an LV earth wire on the opposite side of the pole. The purpose of each earth wire was to transfer dangerous excess energy into the ground, where it could dissipate without causing any harm, in the event of a power surge or some other abnormal occurrence. The earthing system was designed so that HV electricity would not pass from the HV earth wire to the LV earth wire and enter the LV system. The appellant contends that that could have happened as a result of the earth wires not having been installed correctly in 1987, and the resistance between the HV and LV earth wires being too great as a result.
I am not satisfied on the balance of probabilities that the earth wires were installed incorrectly or negligently. However I am satisfied that there is a significant possibility that the earth wires were incorrectly positioned. The learned trial judge reached a similar conclusion at [191]. Although the evidence falls short of establishing negligence, I am satisfied that there is a significant possibility that the HEC breached its duty of care in 1987 by installing the earth wires in such a way that there remained a risk that, in the event of a power surge, electricity would pass from the HV earth wire into the LV earth wire, and on into the LV system. That could well have happened on 10 December 2010.
An HEC drawing showing the design of the pole, drawing B14731, specified that the maximum resistance of the earth connection between the HV earth and the LV earth was to be 30 ohms. Electricity will follow the path of least resistance. The higher the resistance, the less likely it is that electricity will dissipate into the ground, and the more likely it is that, in the event of a power surge, it will pass from the HV earth wire to the LV earth wire and into the LV system.
One of the respondent's witnesses, an experienced linesman named Stephen Doolan, gave evidence as to what was required in relation to the installation of earth wires at the foot of a pole with a transformer on it. HV and LV earth wires were usually installed on opposite sides of the pole, running down into the ground, and then running away from the pole at 180 degrees to one another. They were laid in trenches about 460 mm deep. They were required to be insulated near the pole, so that uninsulated wires were at least two metres from one another. Pins were driven into the earth at intervals of about one metre. Provided the ground was not too hard, they were driven in to a depth of six feet. The pins were connected to the earth wires. Readings were taken at each pin until a reading of 30 ohms or less was obtained.

Aurora replaced the HV and LV earthing systems in January 2012. A manager named Peter Burr oversaw that work. On 9 March 2012 he sent an email to various people in which he reported that testing results for the HV earthing system showed that its resistance before that work was undertaken was 97 ohms, and that its resistance after the work was done was 17.6 ohms. I infer that the first of those readings was taken either immediately before the replacement work commenced in January 2012, or shortly before that work commenced. At the trial, the appellant relied on that email as evidence that the earth wires must have been installed incorrectly and were unable to function as intended. However the learned trial judge observed at [174] and [175] that there was no evidence of the reading of 97 ohms being taken, nor of the method used to take it, that the reading was taken some considerable time after 10 December 2010, and that there was expert evidence that such a reading fluctuates as the resistivity of soil fluctuates. He concluded, at [175], "That evidence makes the applicability of the reading in 2012 to the actual reading (even the likely reading) in December 2010, uncertain at best."
In my view the evidence of the reading of 97 ohms deserves more weight than the learned trial judge gave to it. Mr Burr gave evidence at the trial as a witness for the respondent. No evidence was led by the respondent to suggest that the reading of 97 ohms was unreliable. It is clear from the evidence at the trial that resistance readings were routinely taken by competent Aurora employees. There is no reason to doubt that the resistance on the day the measurement was taken was about 97 ohms. That strongly suggests that the resistivity as at 10 December 2010 was well over 30 ohms, with the result that it was then likely that the earthing system would not have functioned as intended, and that HV electricity could have passed from the HV earth wire to the LV earth wire.
An internal Aurora document tendered on the trial revealed that, at least in the 2007/08 financial year, Aurora had a Statewide "Replace Transformer Earths Program" whereby work was undertaken to repair "pole mounted transformer earths that are found to have higher than permitted earthing values". The program involved routine audits of pole mounted transformer earths. It follows that there is not just a possibility of negligence on the part of the HEC in installing the earth wires in 1987, but also the possibility of negligence on the part of the HEC and Aurora in failing to detect a resistance far in excess of the required maximum of 30 ohms, and failing to undertake appropriate remedial work.
In 2016 the respondent arranged for an excavation to be carried out with a view to locating the original earth wires and establishing where they had been in December 2010. Sections of the original wires were exposed, photographed and filmed. However the evidence obtained by means of that excavation was inconclusive. Mr Doolan gave evidence to the effect that he noticed nothing untoward at the time of the installation of the new earth wires in 2012. Other witnesses who were involved in undertaking that work did not recall anything that strengthened the appellant's case.
As I have said, the learned trial judge made a finding at [191] to the effect that the passing of electricity from the HV earth wire to the LV earth wire as hypothesised was possible. That finding has not been challenged in this appeal. If electricity did pass from the HV earth wire to the LV earth wire as hypothesised, then that was a result of the HEC breaching its duty of care in 1987 by not installing the earth wires with a sufficient separation to achieve a resistance of 30 ohms or less.
The respondent's contentions as to the absence of visible evidence and the fact that fuses did not blow are not relevant to this hypothesis. However it relies on the opinions of its experts to the effect that it was unlikely that there would have been a power surge of sufficient strength and duration to reach and damage the PLC. It also contends that the reading of 97 ohms could have been caused or contributed to by excavations by the appellant in the vicinity of the pole and by natural changes in the resistivity of the soil. There was evidence that the appellant laid a PVC pipe below the surface of the soil near the pole in about 2003. There was no suggestion that the damage to the PLC in December 2010 was likely to have been caused or materially contributed by natural changes in the resistivity of the soil and/or changes in its resistivity resulting from the excavation to lay the PVC pipe. Further, I infer that the HEC and Aurora would have taken the possibility of natural changes in the resistivity of soils into account when choosing the figure of 30 ohms as the maximum allowable resistance.

Other circumstantial evidence

History of electrical breakdowns and outages

A number of witnesses gave evidence about electrical breakdowns and outages over many years prior to 10 December 2010.
Mrs Sandra Hetherington gave evidence to the following effect. She worked at the site from 1986 until November 1992. At the beginning of that period the site was a new one. The electrical equipment was mostly new. She recalled a significant number of occasions when new electrical equipment broke down.
The appellant company was and is controlled by a couple named Karen Brock and Timothy Phillips. They were and are its directors. Ms Brock gave evidence of various pieces of electrical equipment breaking down or malfunctioning, including a brand new electric fence energiser, barcode printers, light globes, bread makers, roof vents in a green house, computers, a fax machine, a water steriliser, the PLC, and heaters. She said these electrical failures occurred from 1996 onwards, but that there had been no further electrical faults since 2012. Mr Phillips gave evidence similar to that of Ms Brock about a history of electrical failures.
There was evidence at the trial as to six identifiable occasions when electrical equipment of the appellant was damaged at times when the electricity supply from the pole was interrupted. The appellant complained to Aurora about damage to electrical equipment sustained on 15 July 2003. An Aurora employee subsequently wrote a letter confirming that there had been an interruption to the electricity supply to the appellant's nursery on that occasion as a result of the operation of a high voltage protection device at Clarence Point.
Aurora recorded an unplanned outage on 6 October 2009 from 8.46am to 5.37pm involving the recloser at Glengarry. The cause was recorded as "Vegetation Outside Clearance". Subsequently an Aurora employee recorded a complaint by Mr Phillips, described as follows: "Ongoing issues with supply. Had damage to equipment in house and nursery on 6 – 7 Oct 2009."
Mr Phillips recorded on a calendar that there was a "blip or outage" on 5 February 2010. In March 2010 he submitted a written claim to Aurora in respect of the damage to the appellant's equipment suffered on 6 October 2009 and 5 February 2010. There was evidence that on the second of those occasions the appellant suffered damage to computerised circuit boards and controllers, including a PC, a laptop, and an irrigation controller. Aurora paid the appellant over $4,000 in respect of that claim.
One of the respondent's expert witnesses, Mr Gillespie, mentioned in one of his reports that a PLC was allegedly damaged on the appellant's property on 24 April 2010. He reported that there was "an HV fault and recloser lockout causing an outage during windy weather".
In the same report, Mr Gillespie referred to a report of "damage to a computerised circuit board in a PC and UPS" occurring on or about 26 November 2011. He said that on that occasion there was an HV fault caused by a bird impacting a conductor, and that the recloser locked out causing an outage. That incident of course was after the outage of 10 December 2010, but it was before Aurora carried out any rectification work to the pole. I infer that Mr Gillespie's information as to that outage and the outage of 24 April 2010 came from Aurora's records.

The events of December 2010

Mr Phillips gave evidence that he turned off the potting machine at around 7pm on 9 December 2010, and next went to use it on 15 December 2010. He said he attempted to turn it on at 7am on that day, but that it would not start. He was unable to see what was wrong. He made a phone call, as a result of which an electrical technician named Paul Whiddon came to the property. Mr Whiddon inspected the PLC. He found the PLC to be correctly wired and installed. He measured the voltage provided to the electrical connections that powered the PLC and found it to be between 230 and 240 volts, which was the correct voltage. He opened the PLC, examined its internal circuitry, and saw shorting of some of the tracks around the communication tracks of the printed circuit board. He told Mr Phillips that a replacement was required. He subsequently installed a replacement PLC. The potting machine became operational again in February 2012. The damaged PLC was apparently disposed of.
The learned trial judge was provided with a statement of agreed facts which included the following:
"17On 10 December 2010 the Defendant's recloser C690306 on Glengarry Road, which supplied 22kV electricity to the Pole, tripped four times and locked out at 23:38 hours.
18The cause of the recloser operating was vegetation across the line at Flowery Gully approximately 6km from the recloser.
19The operation of the recloser caused a loss of electricity to the Property. Electricity was restored at 2:58am on 11 December 2010."
Electricity from the pole went to part of the appellant's property, and not to any other property. On or about 10 December 2010, no harm was suffered to electrical equipment on the appellant's property that was not powered from the pole. There was no suggestion that any electrical harm was suffered on adjoining properties at that time. However the appellant had other electrical items, powered by electricity from the pole and closer to the pole than the PLC, that were damaged at the same time as the PLC. Mr Phillips found that a set of electronic scales and a transformer had become inoperable. He also found that a warning device supplied by Aurora called a Cable PI was flashing red.

Investigation by Mr Page

In 2011 the appellant engaged an electrical engineer named Rayner Page to investigate the cause of the electrical failures at its nursery. Mr Page held a Master's degree and had about 18 years' professional experience at the time of the trial. His professional work had involved fault finding in both HV and LV systems, as well as work associated with microprocessor based electronics. He gave expert evidence at the trial for the appellant. Initially he believed that the cause of the failures would be located within the appellant's infrastructure. He undertook a detailed site assessment, made detailed tests of the appellant's electrical system, and concluded that its infrastructure complied with the relevant Australian Standard. He was unable to find any explanation for the electrical failures within the appellant's infrastructure, and therefore turned his attention to Aurora's infrastructure. He noticed that the right hand bushing on the transformer was too close to the "a" conductor, and that the spark gaps on the transformer were not correctly aligned. He also noticed that the spark electrodes were painted.

The damage to the PLC

The appellant called three expert witnesses at the trial – Mr Page, Mr Piper and Mr Johnston. Mr Piper is an electrical engineer who graduated in 2011 and had about seven years' professional experience at the time of the trial. He had experience in project engineering that included arc flash hazard analysis work for power stations and distribution networks, as well as the design and testing of earthing systems for sites that included power generation, transmission, distribution, mining and industrial sites. Mr Johnston is another electrical engineer. He had some 10 years' professional experience at the time of the trial, including experience in relation to power and lightning surge protection, and the design and testing of earthing systems.
None of the parties' expert witnesses had ever seen the PLC, but four photos were tendered that showed it in its damaged state. On the basis of the damage that they saw in those photographs, Mr Page and Mr Piper both opined that the harm to the PLC was caused by a surge. Mr Johnston gave evidence that the damage seen in the photographs appeared to be only to the terminals of the device. He opined that one would expect to see damage to other components if the damage had been caused by an under voltage.

The rectification work

In the first half of 2012 employees of Aurora did three very significant things:
·     In early or mid-January 2012 they installed the insulation that I have referred to on a section of the "a" conductor adjacent to the pole.
·     On 20 January 2012 they replaced the HV and LV earthing systems at the base of the pole. The new earth wires were installed as the old ones should have been, running away from one another at an angle of 180 degrees, with insulation on the sections adjacent to the pole. After their installation the relevant resistance was measured at 21 ohms.
·     On 27 June 2012 they raised the transformer to a higher position on the pole, thus adequately separating the HV bushings from the LV "a" conductor.
Ever since the insulation was fitted in January 2012, the replacement PLC has operated satisfactorily and the appellant has suffered no further electrical harm. In my view that is an extremely significant piece of circumstantial evidence.

The respondent's contentions as to causation

The respondent's principal expert witnesses at the trial were Mr Gillespie and Dr D'Alessandro. Mr Gillespie is an electrical engineer who graduated in 1979. At the time of the trial he had over 30 years' professional experience. He had worked as an independent specialist consultant since 2010, had published dozens of technical papers, and was an experienced expert witness. Dr D'Alessandro is a former academic. After moving into the private sector his work included lightning protection work as a senior research scientist, and work as a research and development product engineer. He has worked as an independent consultant since 2007 in relation to lightning protection and earthing projects. He has published many technical papers and spoken widely at seminars and conferences.

No physical evidence of a flashover

The respondent's witnesses at the trial included two experienced linesmen, Mr Reeves and Mr Jarman. Mr Reeves gave evidence that on occasions he had attended places where HV and LV conductors had been in contact. He said he had observed conductors that were burnt, splattered and melted. Mr Jarman gave evidence that he inspected the transformer in 2017. He deduced that its original components had not been replaced. In his proof of evidence, which was tendered, he said this:
"I did not see, and the photos don't show, any burn marks or burning on the metal on the transformer or on the conductors. If there had been a flashover at this pole, I would expect from my experience to have seen burn marks or melting on at least some of the metal and possibly discolouration of the porcelain on the bushings. I saw only what I regard as normal wear and tear."
Mr Gillespie stated his opinion as to this issue in one of his reports, as follows:
"... I say that if a switching surge flashed over between the HV bushing and LV conductor 'a', then I would expect a power follow current. Heat from power follow current would melt some of the metal on both the HV and LV conductors. Pitting due to melting of the surface would be visible to the naked eye similar to the mark on the rod of the spark gap. Initially it would be shiny but may become dull over time. I would expect it to be clearly visible seven years later."
However Mr Piper's opinion was that a flashover from the HV bushing to the LV conductor caused by a surge might not cause any mark at all. Mr Page commented that it was evident from photographs that the spark gaps on the pole had fired and operated at some point in time, but that it was not possible to determine when they fired or how many times they had fired.
The learned trial judge observed, at [201], that the lack of any visible evidence of a flashover event might be explained by the passing of time, but might also suggest that there was no such event. Mr Page's observation suggests that there was visible evidence of a flashover. If there was no such evidence, that would be a factor weighing in favour of the respondent, but in my view it would be a very minor factor.

No blown fuses

There were fuses on the pole, but none of those fuses blew on 10 December 2010. That is common ground. In Mr Gillespie's opinion, if there had been a flashover from the spark gaps to the HV earth a fuse would have blown.
However Mr Piper took the view that, because of the speed of a surge event, the surge would pass through the fuses without them getting hot enough to blow. Mr Page adopted Mr Piper's opinion as a correct opinion.
The learned trial judge considered the evidence about the fuses in isolation, and concluded, at [229], that he preferred the evidence of Mr Gillespie. At [208], his Honour said that he preferred the evidence of Mr Gillespie over that of Mr Page and Mr Piper because of his qualifications and experience, and because his evidence was consistent with modelling evidence adduced by the respondent. In my view it is not appropriate to make findings as to issues on which the expert witnesses in this case have disagreed without considering the evidence as a whole. If the respondent's case was supported by expert opinion evidence from the best qualified expert in relation to the fuses, that is certainly a factor that weighs in favour of the respondent, but that expert's opinion is no more than an opinion, and opinions can be incorrect.

Calculations and modelling

Calculations as to the voltages and currents on the appellant's property resulting from a hypothetical flashover event were undertaken by Mr Gillespie, and Dr D'Alessandro. The respondent also relied on Dr Muthumuni's report, which contained calculations as to voltages and currents based on several modelling scenarios.
Mr Gillespie opined that a surge affecting the HV system would have produced a voltage of no more than 55 kV, and that a voltage of 98 kV would have been required for there to have been a flashover from the HV bushing to the LV conductor "a". Further, he opined that if such a flashover had occurred, the largest magnitude of the surge would have occurred at the house, and that the surge would have been attenuated as it travelled onwards to the PLC. If so, electrical equipment between the pole and the PLC would be expected to fail but it did not, hence his conclusion that the PLC's failure was not due to a surge.
Dr D'Alessandro opined that the voltages reaching the potting shed would have been well below 1,000 volts, and that a surge of up to 1,392 volts was unlikely to have caused any damage to the PLC.
Dr Muthumuni's report was dated 17 May 2018. That report was written some two months after the trial started. The trial ran for nine days commencing on 13 March 2018, continued on 16 April, and resumed on 22 May. On that day counsel for the respondent sought to adduce Dr Muthumuni's evidence, but counsel for the appellant objected on the basis that the late delivery of the report caused prejudice. It was conceded that the report was an authentic document and that its contents were relevant. Counsel for the appellant made it clear that if evidence of Dr Muthumuni's opinions was to be admitted over their objection, then the report could be tendered instead of Dr Muthumuni having to give oral evidence. The learned trial judge rejected the objection but offered the appellant an adjournment to deal with the prejudice said to have been caused by the late delivery of the report. That offer was declined by senior counsel for the appellant, who had said that his client did not have the resources to continue the trial beyond that week. The report was tendered as an exhibit and Dr Muthumuni was not called as a witness.

In the notice of appeal the appellant asserts error in the treatment of this third hypothesis by his Honour over and above the general contention that he erred in preferring the evidence of the respondent's experts over that of the appellant's experts without analysis of the reasoning underpinning the opinions of the expert witnesses and over and above the contention that he erred in finding that there was not a high voltage surge event that damaged the PLC.
First the appellant contends that his Honour erred in failing to find that the agreed distance of separation of the high and low voltage conductors could give rise to a flashover event. Second it contends that he erred in respect of the evidence of Dr Muthumuni:
"In admitting it [T554];
In considering it on the basis that that it was tendered by consent [210] when it was not [T525 - 553], and;
At [248] in disregarding the absence of a proper basis for his opinion because the plaintiff did not put the shortcomings listed at [243 and 244] to Dr Muthumuni."
As I apprehend it, the learned trial judge's conclusion that Dr Muthumuni's evidence, Dr D'Alessandro's evidence and modelling, and the evidence of Mr Gillespie, rendered "the plaintiff's hypotheses no more than speculative" was a rolled up conclusion as to the spark gaps hypothesis and as to his Honour's similar conclusions, already noted above, as to the first flashover event hypothesis and as to the existence of the asserted fact as to the location of the earth wires and the associated hypothesis. This rolled up conclusion is, with respect, an error no different to those which I have suggested as to his Honour's approach to the evidence of the first flashover hypothesis and the earth wires hypothesis. Before any of them could be dismissed as non-probative speculation, the established possibility that he accepted, correctly in my view, that those hypotheses were correct, must be considered alongside all of the other circumstantial evidence going to causation.

Consideration of the case as a whole

I return then to the errors I have identified in order to consider whether they are, on a proper analysis, either alone or in combination, operative or dispositive errors when considered in the light of the totality of the evidence relied upon by the appellant for its circumstantial case.
The first observation I would make is that it is clear from the passage at [248] of the learned trial judge's reasons that his Honour placed great weight on Dr Muthumuni's evidence modelling the surge wave created by reason of the operation of a recloser. Notwithstanding the appellant's extensive criticism of it, his Honour regarded Dr Muthumuni's Manitoba Modelling report as the glue that bound Dr D'Alessandro's evidence and the evidence of Mr Gillespie together into a trinity which dispelled the appellant's hypotheses.
However, in my respectful opinion his Honour was not justified in dismissing the appellant's criticisms of Dr Muthumuni's methodology and inputs in the manner in which he did. There were 15 separate criticisms put forward by the appellant and adumbrated by his Honour in the passage from his reasons set out above. Most of them, but particularly those listed at [244] (ii) and (iv) - (ix) of his reasons, give me cause for concern when taken with Mr Gillespie's evidence that "I think that he [Dr Muthumuni] was supplied with data for the network and he modelled it to give an estimate of the maximum switching surge voltage and the currents at the transformer. That was the intent and that’s what he produced", and taken with Dr Muthumuni's own statement in his report that it was "unlikely" that there would be a flashover – not that it was impossible. [Emphasis added.]
Nor, with respect, was his Honour justified in his reliance, for apparent fortification of his confidence in Dr Muthumuni, on his Honour's view that the issues the appellant raised had not been put to Dr Muthumuni because the witness "was not required by the plaintiff for cross-examination, though made available" and that the criticisms were advocacy.
It matters not that the appellant's criticisms were "advocacy". Counsel's criticism of evidence in a circumstantial case, is, as was observed by Lord Cairns in Bellhaven v Stenton Peerage (above), at 279, advantageous and "wholesome".
Nor, with respect, was it entirely contextually correct for the learned trial judge to note that Dr Muthumuni's evidence was tendered "with the consent of the plaintiff, and without the need for Dr Muthumuni to be called" or that the appellant "preferred" not to put its criticisms to Dr Muthumuni, despite him being made available for cross-examination, or to refer to the modelling evidence as "unchallenged".
The following passage from the transcript of the trial sets out the way in which Dr Muthumuni's evidence was introduced, after written objection by the appellant:
"HIS HONOUR: If the evidence is relevant which is conceded and if the need for the modelling is a product of your expert articulating a specific position different from that which was previously assumed then prima facie the evidence should be allowed to be led subject to prejudice and I understand the claim to prejudice – and I have said this before in this trial – I think the prejudice can be cured. I think that the court would be embarking upon a dangerous course if it simply ignored relevant evidence.
MR READ SC: I hear what your Honour says and it was necessary for us to be very open about this. The plaintiff's position is this trial must finish this week. The plaintiff does not have the means to continue with this trial beyond this week.
HIS HONOUR: You are not going to get a decision this week.
MR READ SC: No, no, no. I understand that, your Honour, but it has got to finish this week. The experts are here. Counsel is here. The costs are all being incurred.
HIS HONOUR: Yes. I understand that.
MR READ SC: From the plaintiff's position we do not request an adjournment, your Honour. That's our position and we make it very clear and we're very honest about it.
HIS HONOUR: Yes.
MR READ SC: Very open. That's our position.
HIS HONOUR: Yes; and that goes to the question which is the supplementary question. If I allow the evidence is that evidence to be led before the concurrent evidence which I understand to be the defendant's request or can it be-
MR READ SC: It is not to be led at all, your Honour. That's it. That's the evidence.
HIS HONOUR: It is going to be tendered, isn't it? You're not going to cross-examine.
MR READ SC: It will just be – it will be D, whatever it is.
HIS HONOUR: Yes.
MR READ SC: That's it.
HIS HONOUR: Yes.
MR READ SC: Then we get on with the conclave.
HIS HONOUR: Yes.
MR READ SC: That's why the plaintiff takes this position because it is in the very tight spot in which it finds itself. Now, your Honour, I don't want to – I will risk it but the change of position relates to the amps. It was Mr Gillespie who first proposed 138 amps. That was then responded to by Mr Piper and he has got a different figure. That's the change. Excuse me, your Honour. Yes; and it was responded to on a what if situation. Presuming Mr Gillespie is correct then this is what we say it is. So it's not though it's asserting – asserting a new position, your Honour, his position has always been, it's entirely possible for a surge – for a sufficient surge to be – to come from the recloser, that's the position, but assuming Mr Gillespie's correct, then the figures by reason of various bits of – by various literature, come out much higher than Mr Gillespie says. It is purely and simply in reply to his assertion, your Honour, it is not a change of position, that's – that's the core point.
HIS HONOUR: Well – well I disagree, I think it is a change in position, it may be responsive to some other change, but it nevertheless, is a change of position, because he's gone from the rule of thumb and the assumption based upon a rule of thumb approach, to expressing a view, which is inconsistent with the so called rule of thumb and he's done that on the 23rd of April.
MR READ SC: No, no with respect, your Honour, he hasn't. He's accepted the rule of thumb, the rule of thumb is still inherent in Mr Gillespie's 138 amps, so the rule of thumb is the underlying assumption, that's that remains. Mr Gillespie from the rule of thumb (inaudible) loads 138 amps, Mr Piper, calculates a different figure, that – that's the number, your Honour.
HIS HONOUR: All right. Well I've been in-precise, but I think I've summarised –
MR READ SC: Yes.
HIS HONOUR: - the position correctly, subject to that qualification that you've just made. Look I understand your position, but the evidence is relevant, that fact's conceded, I'm prepared to give your client an opportunity, if it claims prejudice to deal with the prejudice, if that invitation's not taken up, that's a matter for the plaintiff, but I don't think that in the proper exercise of my discretion, I can refuse the evidence that's proposed to be led and so I overrule your objection.
MR READ SC: Yes, I understand that, your Honour, the plaintiff, I – I understand the invitation for an adjournment, your Honour, the plaintiff is not in a position to take that up.
HIS HONOUR: Yes, thank you.
MR READ SC: The prejudice is, on our submission, incurable.
HIS HONOUR: Yes.
MR READ SC: If it please." (Emphasis added.)
Notwithstanding modern day deference to principles of case management, it cannot, in my view, be said that the learned trial judge erred in the exercise of his discretion to admit the evidence despite it extending the length of the trial beyond the appellant's expectation and capacity if Dr Muthumuni was to be called. However, equally, it is somewhat harsh to suggest that the appellant "preferred" not to cross-examine the witness despite being given the opportunity to do so.
As to the appellant's submission to the trial judge in closing that the respondent had not proved a number of the factual assumptions that were apparently relied upon by Dr Muthumuni, Blow CJ, with whom Wood and Brett JJ agreed, explained in Langford v Tasmania [2018] TASCCA 1 that the majority view in Dasreef Pty Ltd v Hawchar [2011] HCA 21, 243 CLR 588, decided only that the lack of proof of an underlying fact went to weight and not to admissibility.
On my own examination of the Manitoba Modelling report, I am unable to replicate the learned trial judge's confidence that Dr Muthumuni's methodology and input data was self-evidently "accurate, material and useful". In my view, unexplained and untested, Dr Muthumuni's evidence does not have the internally obvious and reliably decisive quality attributed to it by his Honour.
It must be remembered that the historical evidence as to the correlation between damage to the equipment at Brocklands and the operation of the respondent's protective devices was that damage only occurred during some power outages and not others. It is reasonable therefore, to suspect, as was submitted by counsel for the appellant in closing submissions at trial, that the variable giving rise to the relevant phenomenon might be something apparently insignificant, for example, the number of times the recloser operated or what caused the recloser to operate. In such circumstances, reliance on a model other than one that took into account the precise operation of the recloser, including how many times it operated and the time taken to reclose, and absent knowledge of the technical specifications of the recloser, must, to my mind, be regarded as fraught.
In the final analysis it is my view that Dr Muthumuni's modelling was only, as Mr Gillespie said, an "estimate", and even taken at its highest it was, in Dr Muthumuni's own words, merely, "unlikely" that the amplitude of the surge voltage would be sufficient for a flashover, as distinct from "impossible" or even "inherently improbable". The appellant's hypotheses as to causation did indeed remain "possible" and, coupled with other circumstantial evidence, remained capable of establishing factual causation as more probable than not.
I respectfully disagree with the learned trial judge's view that Dr Muthumuni's use of the word "unlikely" was synonymous with "improbable" in the sense, as his Honour put it, that it "engages the language of probabilities in a context where it is to the probabilities the Court must turn its mind." To my mind Dr Muthumuni's methodology and particularly his questioned inputs, while falling well short of rendering it inadmissible, ought, for the reasons advanced to his Honour by the appellant, to have been treated cautiously. It did not alone, or in conjunction with Mr Gillespie's and/or Dr D'Alessandro's evidence, dispel the appellant's circumstantial case for factual causation. Indeed, on one set of assumptions made by Dr D'Alessandro his conclusion, as I apprehend it, was that voltage sufficient to damage the PLC was produced.
Next, in relation to each of the possible mechanisms of a switching surge occurring on the LV neutral, the possible mechanism of a flashover from the HV bushing to LV conductor 'a' entering to secondary winding of the transformer and coming out of the LV neutral and into the house and nursery, and the possible mechanism of a flashover from the HV bushing to the LV conductor 'a', Mr Gillespie's evidence was that a power follow current would be expected, which he asserted should have blown a fuse or fuses at the transformer. Since there was no blown fuse, in his opinion there was no surge. Mr Piper's opinion on the other hand was that the fuses had not blown because they are designed to blow in fault circumstances when energy travelling through them causes them to heat up and disintegrate. It was his opinion that during a fast moving surge event of the kind he considered caused the appellant's damage, the surge would pass through the fuses without blowing them because they would not get hot enough. His view was that fuses are "fault protection, not surge protection." As to this contest of ideas, I note that historically at least six events evidence a correlation between the operation of the respondent's protective devices and damage sustained to the appellant's electrical equipment and the evidence was that the fuses had not blown since 1998.
Perhaps his Honour should have accepted the appellant's expert evidence. I find Mr Piper's opinion compelling. But at best from the appellant's perspective the combined expert evidence it adduced demonstrated a causal connection between the equipment on the pole and the damage to the PLC, whilst the respondent's expert evidence neither showed such a connection to be impossible or inherently improbable, nor established that it was less likely another reasoned probable cause. The precise magnitude of surge voltage the PLC would withstand was, on the evidence, simply unknown, especially when the line recloser tripped multiple times before locking out. At worst from the appellant's perspective, the expert evidence on either side was not capable of establishing causation or negating it. In those circumstances, in either the best or worst case scenario, the other circumstantial evidence to which I have referred was, to my mind, sufficient to establish factual causation on the balance of probabilities. Indeed it was, in my view, sufficient without any expert evidence. Aided however, by the "possibilities" accepted by the learned trial judge as at the very least to be derived from the expert evidence, the other strands in the cable combined to create what I regard as an overwhelming circumstantial case.
The same analysis can be applied to Mr Gillespie's view that if there was a switching surge that entered the house on the LV conductor 'a', the combined effect of the line impedance of the LV wiring and the load impedances would cause attenuation of a switching surge, which would mean that the largest magnitude of the switching surge would occur at the house and it would then be attenuated as it travelled to the PLC, so that electrical equipment would be expected to fail along the way. Since it did not, it was his opinion that the PLC did not fail due to a switching surge. Even leaving aside Mr Phillips' evidence that when he went to switch on the PLC on 15 December 2010, he discovered that the Aurora PI in the media room in the laboratory was activated and flashing red and a set of scales was damaged, and leaving aside the inference to be drawn from the fact that previous events had damaged some but not all of the household electrical equipment, the respondent's evidence merely combatted as opposed to defeating, the evidence of Messrs Page and Piper, (which was based on the work of Francois Martzloff as to the vagaries of surge occurrences), that because of the nature of a transient surge, while there may be minimal attenuation, not all equipment will be damaged all the time, and it is impossible to predict which equipment will be damaged.
As to the appellant's ground of appeal that the learned trial judge erred in preferring the evidence of the respondent's experts over that of the appellant's, without analysis of the reasoning underpinning their respective opinions of the expert witnesses, I accept that his Honour did not advance reasons for preferring the respondent's experts, beyond reference to their experience, and that he failed to note that Mr Piper was an electronics engineer who might be thought to better understand the dynamics of the PLC. That Mr Gillespie was preferred by his Honour over Messrs Page or Piper, because of Mr Gillespie's "particular qualifications and experience in electricity transmission, and the design and maintenance of PLCs in the electricity transmission business", and that his evidence was "confirmed by … and consistent with the modelling evidence before the Court", is to my mind difficult to justify given the exchanges between the witnesses in the "joint evidence" of the experts, and in view of my reservations about the Manitoba Modelling. I have a similar view as to his Honour's preference for the evidence of Dr D'Alessandro over that of Nicholas Johnston, "based upon the former's qualifications, experience and publication of learned articles", given that Dr D'Alessandro's evidence also relied on Dr Muthumuni's modelling and that as noted, on one set of assumptions made by Dr D'Alessandro his conclusion was that voltage sufficient to damage the PLC was indeed produced.
To my mind, however, the case, being a circumstantial case, it was not to be decided solely by choosing between these experts. As I have observed, the respondent's expert evidence admitted some if not all, of the possibilities that the appellant hypothesised. As Porter J observed in Langmaid (above), at [139], that can be enough, depending on other evidence. The appellant did not have to exclude every hypothesis consistent with an absence of negligence on the part of the respondent.
However, even if it was appropriate or desirable to attempt to decide the case by choosing between the experts on either side, the non-expert circumstantial evidence operated in two ways:
a) it combined with the appellant's expert evidence, and the existence of the possibility of a causal connection left open on the respondent's expert evidence, to symbiotically point to causation-in-fact on the balance of probabilities as asserted by the appellant, and
b) it also underpinned comfortable satisfaction of a causal connection by militating against acceptance of Mr Gillespie's speculation in his experts memorandum of 12 March 2018 as to ten possible non-negligent causes of the respondent's damage, and at the same time facilitating acceptance of the appellant's expert evidence by sitting conformably with it.

Conclusion and disposition

The non-expert evidence, taken together with the appellant's expert evidence, not shown empirically to be fallacious, and taken together with the admitted possibility of the appellant's hypotheses and the lack of a reasoned and related alternate cause of the appellant's damage, to my mind combine to produce an irresistible circumstantial case.

In saying this, I should allow that, contrary to my view, it may not be universally accepted that a fair reading of the respondent's expert evidence, admitted of the possibility of every one of what I have characterised as the appellant's three hypotheses as to factual causation. However, I think it undeniable that such was the case with the two flashover hypotheses.
Although it bore no legal burden of proof, the respondent's expert evidence did not establish that a high voltage surge event could not have been responsible for the damage to the PLC or that it was empirically less likely than a competing hypothesis. The modelling relied upon to establish that sufficient voltage would not have been generated to cause the damage is far from empirical evidence, and the theories that the fuses would have blown if there was sufficient voltage, or that other equipment would also have been damaged, are adequately met by the contrary views of the appellant's experts and supported by the strong non-expert circumstantial evidence of years of problems which effectively disappeared after the equipment on the pole was re-configured in 2012. As Porter J said in Langmaid (above) at [141]:
"As to causation, the law does not insist on the need to demonstrate the mechanism of loss or damage 'to a fine degree': Duma v Mader International Pty Ltd [2013] VSCA 23 per Neave JA at [3]. See also Strong v Woolworths Ltd (above) at 196, [34], and Kuhl v Zurich Financial Services Australia Pty Ltd (2011) 243 CLR 361 per French CJ and Gummow J at 381 – 382 [53] – [54]."
At a relatively high level of abstraction, the learned trial judge erred by rejecting the non-expert circumstantial evidence as inadmissible or of no value, and in failing to have regard to that evidence, both as to its importance to the appellant's circumstantial case and as facilitating acceptance of the appellant's expert evidence and militating against acceptance of the respondent's expert evidence. A review of the 815 page transcript of the trial and of the exhibits tendered on either side, reveals those errors to my satisfaction at a micro level.
It is well understood that where evidence is circumstantial, an inference can be drawn from a combination of facts, none of which when viewed alone would support that inference (Fennell v The Queen (above), at [82]; Hillier (above) at 638 [48]; Chamberlain v The Queen [No 2] (above at 536) per Gibbs CJ and Mason J and semble Brennan J and Shepherd v The Queen (1990) 170 CLR 573 at 579). As Lord Cairns, with whom Lord Hatherley agreed, said in Bellhaven v Stenton Peerage (above) at 279:
"My Lords, in dealing with circumstantial evidence, we have to consider the weight which is to be given to the united force of all the circumstances put together. You may have a ray of light so feeble that by itself it will do little to elucidate a dark corner. But on the other hand, you may have a number of rays, each of them insufficient, but all converging and brought to bear upon the same point, and, when united, producing a body of illumination which will clear away the darkness which you are endeavouring to dispel."
With respect, it seems to me that the learned trial judge did not approach the case in that way.
The "key circumstances" in the case asserted by the appellant are set out by its counsel Mr Read SC and Mr Cox, in their written submissions. They are all listed, however to my mind, the significant and largely uncontroversial "rays of light" are those adumbrated to the following effect:
·     The Potting Machine was switched off by the Plaintiff (through its directors, or one of them) on 9 December 2010 .
·     On 10 December 2010 the Defendant's recloser C690306 on Glengarry Road, which supplied 22kV electricity to the Pole, tripped four times and locked out at 23:38 hours.
·     Operation of the recloser will cause a voltage surge.
·     On 16 December 2010, the Plaintiff (through its Directors, or one of them), turned the Potting Machine on. The Potting Machine did not operate when turned on .
·     The damage to the PLC was consistent with being caused by a voltage surge.
·     Over 20 years of harm occurred to electrical equipment powered by electricity supplied from the pole.
·     Harm was occurring to equipment on different circuits and in different areas of the property indicating a cause common to all: the electrical supply.
·     Of that harm on at least six separate occasions there was evidence available to show that the HV protective device (recloser) had operated at a time just prior to that damage.
·     In January 2012 conduit was placed on the LV conductor to stop further flashovers until the Pole could be fixed.
·     After the conduit was fitted Brocklands suffered no further electrical harm.
·     Aurora replaced the high voltage and low voltage earthing systems at the base of the Pole (20 January 2012).
·     Aurora lifted the HV bushings so as to adequately separate the HV and LV conductors. This was done by raising the height of the Transformer on the Pole (27 June 2012).
·     The equipment at Brocklands suffered no further demonstrably electrically caused harm.
Taken together, either with or without the appellant's contested expert evidence, but viewed through the lens of the respondent's experts acceptance of the possibilities of a causal link, and the absence of other demonstrated and reasonably possible sources of voltage surge or reasoned cause of the damage to the PLC, those "rays of light" amply justify, in my view, the drawing of an inference as to causation in favour of the appellant.
The respondent in its written submissions contended that;
"The evidence was that some of the items that failed were inspected or repaired by, or sent for repair to, third parties: T133-134, T255, T277-278. None of those third parties gave evidence, nor were any associated documents tendered. The LG TV was replaced under warranty: T134. The associated paperwork was not tendered. There were replacements: the circuit boards on the Southcorp gas heater were replaced on at least two occasions (T112) and the Richdel irrigation solenoid controllers were replaced several times (T276). No evidence was tendered in relation to the basis on which each was replaced, by the replacing party or by anyone else electrically qualified to diagnose the reason replacement was required."
That submission however, and the respondent's oral submissions made at yesterday's hearing, ignore the fact that in January 2012 conduit was placed on the LV conductor to stop further flashovers until the pole could be further modified, and that, after the conduit was fitted, the appellant suffered no further electrical caused equipment damage. And it ignores the fact that on 20 January 2012 the high voltage and low voltage earthing systems at the base of the pole were replaced, and on 27 June 2012 the HV bushings were lifted, so as to adequately separate the HV and LV conductor, by raising the height of the transformer on the pole. Again, after those things were done the appellant suffered no further apparent electrical harm.
The respondent also submits that other possible causes of the appellant's harm included interference or interaction between different equipment onsite, harmonics, "unbalance loading of phases", incorrect rating of equipment, sensitivity of equipment to voltage fluctuations, poor quality equipment, poor insulation, workmanship and the ten common causes for computer-related equipment to fail, mentioned in Mr Gillespie's report of 1 August 2017 (Exhibit D75) and his expert memorandum. In addition, the respondent contends that the converter onsite which converted single phase power to three phase power could produce voltages outside the normal range, and that starting large motors can cause voltage drop on the supply to other equipment.
As was observed in Langmaid (above), it is possible to acknowledge the combined strength of the possibilities raised by a defendant while at the same time finding that it is more probable than not that one or more of the alleged breaches caused the asserted damage. However possible causes advanced on behalf of the respondent were highly speculative. Moreover, it must be observed that the evidence demonstrated that the electrical wiring at the property was tested and found to be substantially in accordance with AS3000, the PC was tested and found to be wired correctly so as to produce the correct voltage to the PLC, and there was no evidence of large motors present on the property in 2010. Further there was no evidence to suggest what equipment may have been present that might have interacted to cause a voltage surge.
Ultimately, it follows, from all that I have said, that I regard the errors I earlier, respectfully, alluded to on the part of the learned trial judge, but of which I deferred consideration, as operative errors, which are dispositive of the appeal.
In my view, ground 2 of the notice of appeal is made out as are the grounds that the learned trial judge:
"5Erred at [201] in finding that the evidence of a flashover event was 'mere conjecture' ...
8Erred in finding at [259] that there was not a high voltage surge event that damaged the PLC …
9Erred in failing to find that the agreed distance of separation of the high and low voltage conductors could give rise to a flashover event.
10Erred at [124] in disregarding the evidence of Mr Richardson.
11Erred at [131] in attributing the evidence of Mr Whiddon no weight …
13At [155] the learned trial judge erred in concluding that the evidence of Ms Brock, Hetherington and Mr Phillips was inadmissible opinion pursuant to s 76 of the Evidence Act 2001 …
15Erred in respect of the evidence of Dr Muthumuni:
(c) At [248] in disregarding the absence of a proper basis for his opinion because the plaintiff did not put the shortcomings listed at [243 and 244] to Dr Muthumuni."
I do not find it necessary to consider the ground that his Honour erred at [39] of his reasons in "finding" that the cost of rectifying 50,000 transformers would be "onerous to the point of being unreasonable" in circumstances where there was not any evidence before the Court of the costs of rectification or that it was needed. That observation by his Honour was not to my mind critical to his reasoning to the conclusion at [43], that AS2067:1984 was the only standard applicable to the respondent's installation. I find no error in that reasoning notwithstanding the appellant's asserted "maintenance failure" case. Given the nature of the shortcomings with the installation and considering what was involved in modifying the pole, the burden of taking precautions to avoid similar risks of harm is not an issue in this case in my view.
As a provider of infrastructure along which a supplier of electricity, delivers electricity to consumers, it cannot be doubted, in my view, that the respondent owed a duty of care to the appellant to take reasonable care to avoid foreseeable damage to the appellant and its property. Given the inherently dangerous nature of electricity, the standard of that duty of care was high. However in my opinion it remained the standard of care which was reasonable in the circumstances and was not so onerous as to "amount practically to a guarantee of safety" as was submitted by the appellant in reliance on the statement in Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 at [41]. In any event, such a standard was not pleaded against the respondent, nor contended for at trial and it ought not in such circumstances be entertained on this appeal.
In my view, the whole of the evidence compels the drawing of the inference that a breach of the respondent's pleaded duty of care caused the relevant harm. At the very least the evidence supports the conclusion that at the time the PLC was damaged, the supply of electricity exceeded the permissible maximum of 345 volts for a "length of time", as the PLC could withstand 500 volts for one minute and yet it was damaged. Also, at the very least, there was inadequate separation of the HV and LV conductors – so much was admitted by the respondent in its defence. So too was the fact of a misalignment of an arc gap rod admitted in the defence. And, while s 12 of the Civil Liability Act prevents the subsequent taking of action, that would have avoided the risk, from constituting "evidence of liability", the circumstance that modifications to the pole resulted in an end to the historic problems with the appellant's electrical equipment is one that is influential in fact finding as to breach of duty.
I conclude, as did Mr Piper, that the most likely cause of damage to the PLC was a surge of high voltage electricity which bypassed the surge protection on the transformer and arced to the active 'a' conductor where it travelled to and damaged the PLC unit by one or more unknown paths "that cannot be empirically determined". I do not consider that such a conclusion is mere speculation, or a matter of choosing between guesses. Whichever of the three possible mechanisms, or whichever combination of them, caused the surge, I am satisfied that it was as result of a breach of the respondent's duty to take reasonable care to avoid foreseeable harm to the appellant. The respondent, or more correctly, the entity for whom the respondent subsequently assumed legal liability, well knew of the problems said to have emanated from the pole historically and it had been inspected many times over many years.
In reaching my conclusion I have not found it necessary to call in aid the approach discussed in Betts v Whittingslowe (1945) 71 CLR 637 and explained in Roads and Traffic Authority v Royal [2008] HCA 19, 82 ALJR 870 by Kirby J at 888 [88] and Amaca Pty Ltd v Booth [2011] HCA 53, 246 CLR 36 at 57 [49]. That approach is, after all, only "an aspect of an available process of drawing of conclusions about causation": Bauldserstone Hornibrook Engineering Pty Ltd v Gordian Runoff Ltd [2008] NSWCA 243, 5 ANZ Insurance Cases 61-780 per Allsop P (Beazley and Campbell JJA agreeing) at [240]. I find that in this case, an ex post facto inference of causation-in-fact is justified.
I am affirmatively persuaded that the respondent's breach of duty was a necessary causal element of the occurrence of the appellant's particular harm, namely the damage to the PLC. In my view it goes without saying that in the case of as a provider of network infrastructure along which a supplier of electricity delivers electricity to consumers, it is appropriate that the scope of the respondent's liability, should extend to that harm.
I can find no error in the reasoning of the learned trial judge in concluding that the case was not one of pure economic loss, but one of economic loss consequent on property damage. The fact that there may be no particularised claim for the cost of the PLC does not alter that.
Finally, the respondent submits that the pleadings and the evidence do not allow the appellant to establish a duty at all, and particularly one that would extend to an obligation to guard against the risk of consequential economic loss. It is submitted by the respondent that the operation of s 13(1)(b) of the Civil Liability Act deprives the appellant of the right to judgment for damages to be assessed. I do not accept those submissions. The prerequisite to a finding that breach caused "particular harm" as set out in s 13(1)(b), namely, that it is appropriate for the scope of the liability of the person in breach to extend to the harm so caused, does not require a Court, once "harm" is established, to assess the amount of "loss" or "damage" before it can make a finding as to the scope of a defendant's liability for that harm. In Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd [2013] HCA 10, 247 CLR 613 at [24], French CJ and Hayne and Kiefel JJ said, in a case involving the Civil Liability Act 2002 (NSW):
"In the identification of the damage or loss that is the subject of the claim, it is necessary to bear in mind that damage is not to be equated with what is ultimately awarded by the court, which is to say the 'damages' which are claimed by way of compensation and which are assessed and awarded for each aspect of the damage suffered by a plaintiff. Damage, properly understood, is the injury and other foreseeable consequences suffered by a plaintiff."
The appeal should succeed and there should be judgment for the appellant for damages to be assessed. The action should be remitted to a judge or the associate judge for the assessment of damages.

File No FCA 1869/2019

BROCKLANDS PTY LTD v TASMANIAN NETWORKS PTY LTD

REASONS FOR JUDGMENT FULL COURT

PEARCE J
15 June 2020

I agree with Blow CJ and Estcourt J that the appeal should be allowed and that judgment should be entered for the appellant against the respondent for damages to be assessed by a judicial officer other than the learned trial judge. I agree with the reasons of Blow CJ.