Burns Philp and Company Ltd v J Blackwood & Son Ltd - [2000] NSWDDT 9

CITATION:Burns Philp and Company Ltd v J Blackwood & Son Ltd [2000] NSWDDT 9

PARTIES: Burns Philp and Company Ltd - Cross Claimant
J Blackwood & Son Ltd - Cross Defendant

TITLE OF COURT: Dust Diseases Tribunal

JURISDICTION: Original

MATTER NO/S: 54 of 1999

DELIVERED ON: 8 November 2000

DELIVERED AT: Sydney

HEARING DATES: 30 October 2000

JUDGMENT OF: Curtis J

NUMBER OF PARAGRAPHS: 44

CATCHWORDS: Dust Diseases Jurisdiction- cross claims- duty of care vendor to third party- causation-Peto Formula

REPRESENTATION
CROSS CLAIMANT
Mr G F Little SC instructed by Connery & Partners appeared for the cross claimant
CROSS DEFENDANT
Mr G M Watson instructed by Allen Allen & Hemsley appeared for the cross defendant

Dust Diseases Tribunal of New South Wales

Matter No 54 of 1999

Burns Philp & Company Ltd

(Cross Claimant)

J Blackwood & Son Ltd

(Cross Defendant)

8 November 2000

JUDGMENT

CURTIS J

Background

Peter Thompson Bullen (the plaintiff) contracted the asbestos related disease of mesothelioma in 1988. He was by trade a fitter and worked in that occupation as an apprentice and tradesman between 1946 and 1953. He was in that time exposed occasionally to the inhalation of asbestos dust and fibre.
On 10 October 1953 the plaintiff commenced work as a ship’s engineer with the Adelaide Steamship Company on the MV Mandunda. With the exception of short periods in shore jobs for a year or so following his marriage in September 1955, he worked as a ship’s engineer from 1953 until 1970. The last 10 years of this service were in the employ of Burns Philp & Company Ltd (Burns Philp). Throughout his time as a ship’s engineer the plaintiff inhaled asbestos dust and fibre in the engine rooms of the ships upon which he served.
J Blackwood and Son Ltd (Blackwoods) were industrial engineers’ suppliers who sold asbestos products and materials to Burns Philp for the purpose of repair in the engine rooms of the ships upon which the plaintiff worked.
On the 19 May 1999 the plaintiff sued Burns Philp in this Tribunal and on 4 June 1999 judgment was entered in his favour in the sum of $148,375. Burns Philp now claims contribution pursuant to s 5 of the Law Reform (Miscellaneous Provisions) Act 1946 from Blackwoods in respect of its liability to the Plaintiff.

Defences

In answer to the claim Blackwoods assert:
(1) They owed no duty of care to the plaintiff.
(2) In the alternative that the products of Blackwoods did not cause or materially contribute to the plaintiff’s mesothelioma
(3) In the alternative that the unreasonable conduct of Burns Philp, in the manner of its defence to the plaintiff’s action and its acceptance of low contribution from other cross defendants, should be taken into account in determining the just and equitable contribution from Blackwoods. It has not been necessary to consider this defence.

The plaintiff’s exposure to asbestos with Burns Philp

The plaintiff during the time of his employment with Burns Philp was exposed to five sources of asbestos dust and fibre:
(1) The disintegration of asbestos lagging in the engine room while the ship was at sea because of heat and vibration.
(2) The removal of asbestos lagging from pipes and vessels either at sea or in port in order to effect small repairs.
(3) The replacement of asbestos insulation following those repairs.
(4) The removal of asbestos lagging by contractors in port in order to carry out mass extensive repairs.
(5) The replacement of that lagging by the same contractors.
I discount a single instance where the plaintiff was required to smash asbestos millboard into powder for a particular repair.
The perennial source of exposure was that caused by vibration in the engine room; “When the ship was at sea I was constantly breathing asbestos dust”. This exposure cannot be traced to Blackwoods products which were used for small repairs, but rather to the asbestos applied when the ship was manufactured or applied when large repairs were effected in port by contractors.
The next greatest exposure in terms of volume would appear to be the exposure when the plaintiff supervised the work of contractors while the ship was in port. The plaintiff said that:
When lagging was being done the air was very dirty. The ships crew on each of the vessels regularly swept the deck, they used a dust pan and brush to sweep up the asbestos dust and bits of asbestos fibre and this caused more asbestos dust to be released into the air.
The lagging work performed at sea from the evidence of Mr Turkington and Mr Snell appears to have been mainly directed at the flexible expansion joint of the engine exhaust pipe. The joint was a bellows-like structure prone to break down. Mr Turkington said this would occur occasionally in a cyclone or a heavy sea. Mr Snell said it may occur six times in a year. The repair required that a fair bit of old asbestos material be stripped and replaced in order to effect the repair. Blackwoods’ products were used in replacement.
The other work involving Blackwoods products was work on parts of the boiler system. Mr Turkington said that joints may blow in the system perhaps three to four times a day in very rough weather but “you’d go for months and nothing happened and then you’d have a few mishaps”. Mr Snell said it was “not very often” that the system required attention. During the time he worked at Burns Philp the plaintiff was entitled to 0.8 days leave for each day worked. It is probable that he was on duty for about 200 days each year. Of that 200 days he probably spent no more than 10 days working with asbestos products supplied by Blackwoods, and on each of those days he was concurrently exposed to other fibres in the atmospheric contamination of the engine room by the pervasive asbestos dust.
Doing the best I can upon the limited evidence before me and bearing in mind the time spent in port with no exposure it seems probable that asbestos products supplied by Blackwoods account for 5 per cent of the asbestos fibres inhaled by the plaintiff when he was employed by Burns Philp.

Duty of Care

Mr Watson submits that there is no established category of duty which bears upon the relationship between a retailer or distributor of a chattel, and a third party who upon use of the chattel suffers injury or loss. He asserts that in those cases upon which Mr Little for the cross claimant relies, Clarke v Army and NavyCo-Operative Society (1903) 1 KB 155 and Fisher v Harrods Ltd (1966) 1 Lloyds Reports 500, the retailer had actual knowledge of the danger. It is his submission that to import a duty of care into such a relationship where the allegation is merely that the retailer ought to have known of the danger is to propose a novel category.
I reject this submission. The law is simply put by the late Professor Fleming at p 493 of the eighth edition of his text “The Law of Torts” where he states that:
Retail dealers and other distributors are not altogether exempt from responsibility for defective products manufactured by others ... they owe an independent duty of care to [customers] and third parties. Their duty in the first place is to warn of the danger of which they know or should know[emphasis added].
In Fisher v Harrods Ltd the trial judge held that:
In my judgment the defendants initial fault in putting this commodity on the market without making proper enquiries and without seeing that an adequate warning of danger was affixed to the bottles was and remained the effective cause of the plaintiff’s injuries (p 510)[emphasis added].
That is not the end of the matter. The category being established, it is necessary to consider whether the facts of the present case conform to necessary elements of such a category.
As Isaacs ACJ said in Metropolitan Coal Company v Melbourne Corporation (1924) 35 CLR 186 at 194:
No conclusion can be reached of negligence until first the mind conceives affirmatively what should be done.
In Laundess v Laundess (1994) Aust Torts Reports 61, 870, Mahoney J said:
However as in my respectful opinion the High Court has made clear, the addition of the requirement of proximity does not determine whether, in a particular case, a duty of care exists. A vendor of goods, eg a blanket or a book, is in direct proximity to its purchaser. It is plainly forseeable that, if dermatitis may arise from handling the goods, injury is forseeable. But it is not in every case of the sales of a blanket or a book that there is a duty to examine the goods to ensure that they will not cause dermatitis or the like. There must, as I have suggested, be something more.
I do not think that the additional factor can be stated in a simple formula of words. The circumstances in which a duty of care will be imposed on a vendor of goods must in my opinion depend upon the nature of the goods, the risk involved, and the circumstances of the case. This, if properly analysed, means that the existence of such a duty will depend upon the judgment of the individual judge or judges, applying (as it has been described) the anthropomorphic conception of justice.
And further:
Considered merely in terms of possibility, a risk of injury may exist in goods of any kind, even as innocent as blankets and books. In considering whether, in the particular case, a duty exists, it is in my opinion necessary - at least it is of assistance - to determine first what is the risk in respect of which the duty is said to exist and what the defendant would be expected to do to deal with it.
Before the risk of contracting the disease of mesothelioma from the inhalation of very small quantities of asbestos fibre was appreciated, conventional wisdom was that asbestos materials could be safely handled provided adequate precautions were taken. In the present case the forseeable risk before approximately 1966 was that the asbestos material supplied by Blackwoods may cause injury to health if air borne concentration of fibres to which a man was exposed exceeded the Dreesen standard on other than isolated occasions.
Blackwoods sold relatively small quantities of asbestos to a reputable employer for use in occasional repairs. There is no evidence that had the plaintiff been exposed only to fibre thrown off by Blackwoods’ asbestos products he was forseeably at risk of contracting the known asbestos related diseases of asbestosis or lung cancer. There is no evidence that Blackwoods knew that this small amount of dust and fibre would be aggregated in the atmosphere of the plaintiff’s environment with a great deal of other asbestos dust so as to create a forseeable risk of contracting these diseases. It may be otherwise if the purchaser Burns Philp was an insulation contractor rather than a shipping company.
For the plaintiff to establish the liability of Blackwoods it was necessary that he prove as forseeable to Blackwoods the cumulative risks of aggregation of dust and the further want of care on the part of his employer. This is a risk upon a risk and in probability theory shrinks to the dimensions of the risk considered in Bolton v Stone [1951] AC 850.
How might a reasonable retailer deal with such a risk? Burns Philp submit that Blackwoods ought have; (1) Warned the employer; this may have easily have been done by amendment to its printed catalogue; (2) Warned the plaintiff; presumably by printing and fixing warning labels to the product; (3) Withdrawn all asbestos products from sale.
Because the relevant acts in fixing duty in the present case were the sales of small quantities of asbestos products to this employer and because Blackwoods had no cause to believe the fibres from their products would be aggregated with other fibres, or that Burns Philp would be in breach of its duty to the plaintiff, I believe that Blackwoods did not act unreasonably in failing to warn Burns Philp. The dangers were sufficiently well known to prudent employers. There is no evidence that Burns Philp was unaware of the need for precautions. In any event if the failure of Blackwoods to warn Burns Philp was in breach of a duty owed to the plaintiff I would not conclude that the failure was a cause of his injury in the absence of any evidence from Burns Philp that it would have reacted to the warning and protected the plaintiff from all exposure. Further, in my judgment the risk was so remote that Blackwoods as a reasonable vendor need not in response go to the trouble and expense of printing and affixing labels to warn the plaintiff. It is unreasonable to accept that Blackwoods in the circumstances obtaining in the case, before the risk of mesothelioma was known, should have refused to sell these products to this employer. I have concluded that Blackwoods breached no duty of care before the end of 1966.
Between 1967 and 1970 my conclusions are otherwise. The existence and content of a duty owed by a vendor to persons other than his purchaser must relate to the magnitude and gravity of the risk. Blackwoods distributed a wide rang of asbestos products for use by workmen such as the plaintiff and should have kept itself informed of the asbestos debate then current in newspapers and the informed community. It should have learned of the very real dangers of asbestos no later than the end of 1966. It is difficult to be exact in matters of gradual revelation.
Blackwoods ought not have sold asbestos products to Burns Philp after 1967. The forseeable risk to the plaintiff as a member of an identifiable class who would use the products was grave. Blackwoods ought to have been aware of dangers which could not readily have been obviated by any employer. Blackwoods’ duty to the plaintiff then required that it withdraw all asbestos products from sale. The “something more” required by Mahoney J which established the duty so to act was the gravity of the risk; the vulnerability of the plaintiff, a working man who may not be fully informed; the general expectation that vendors inform themselves as to the properties of their merchandise; and the special position in which Blackwoods found itself with power to refuse supply of a dangerous material to the plaintiff’s employer.

Causation

It is the burden of Burns Philp to prove that those asbestos fibres thrown off by products supplied by Blackwoods between 1967 and 1970 and inhaled by the plaintiff constituted a cause of or material contribution to his disease.
There is before me no evidence such as that of Dr Henderson in E M Baldwin & Son Pty Ltd v Plane (17 NSWCCR 434) that all asbestos exposure is contributory in the aetiology of the disease.
Burns Philp rely upon the evidence of Dr Clarke and Professor Shilkin in the plaintiff’s case that the period of exposure at Burns Philp made in the words of Dr C W Clarke “a significant contribution to the development of his mesothelioma” and in the words of Professor Shilkin “materially contributed to the development of his malignant mesothelioma”. Each based his opinion on two factors: first the total extent of the exposure in the period and second the consistency of the latency period of 39 years from the first exposure with Burns Philp with epidemiological expectation.
Mr Watson for Blackwoods submits that this evidence should not be accepted. He tenders pursuant to s 25 of the Dust Diseases Tribunal Act evidence of Dr Joseph in Bradburn and Dark, Dr Gandevia in Walsh and Dr Berry in McCusker. The evidence of Dr Joseph and Dr Gandevia is to the effect that because the mechanism by which asbestos fibres cause mesothelioma is unknown there is no scientific basis upon which it may be asserted that any particular one of multiple serial exposures caused or materially contributed to contraction of the disease.
In Walsh Dr Gandevia said:
It is impossible to say that any particular isolated exposure produces a material contribution, but it is possible to say that the earliest exposure to asbestos is particularly significant in relation to subsequent development of mesothelioma, so in that sense, it is the most relevant part of the history.
The submission of Mr Watson must be seen in the context of the decisions of the Court of Appeal in Barnes and Walsh.
In ICI Australia Operations Pty Ltd v Walsh (1997) 15 NSWCCR 279 at 283-284 Mason P said:
My views in relation to causation and negligence claims relating to mesothelioma are set out in Bendix Mindex Pty Ltd v Barnes (sub nom Exxon Ltd v Barnes) (1997) 14 NSWCCR 661. They need not be repeated at length. I recognised that a plaintiff need establish no more than that his or her injuries are caused or materially contributed to by the defendant’s wrongful conduct. I referred to a number of procedural or adjectival concessions made by the law in favour of the uncertain plaintiff. Nevertheless it was my view that neither these, nor any authoritative decision of the High Court, supported:
“…The principle that a party who negligently exposes a plaintiff to a risk of injury will be liable unless the plaintiff can (also) persuade the trier of fact that it was probable that the risk came home”.
Quoting from an academic article - Andrew Grubb in [1988] Cam LJ 350 - I held (at 672) that:
“The law does not equate the situation where the defendant had materially increased the risk of injury with one where he had materially contributed to the injury”.
Applying these principles to cases involving mesothelioma and multiple defendants I concluded that the ultimate issue becomes one of deciding which (if any) of the persons sued were shown, on the balance of probabilities, to have caused or materially contributed to the plaintiff’s mesothelioma. Expert evidence may establish that a defendant’s conduct might have caused or materially contributed to the illness, even though there may be a weight of evidence to the contrary. Nevertheless there remains a critical distinction between expert evidence that a causal link is possible and a sustainable finding by the trier of fact that it was demonstrated as a matter of probability. As one might expect, the principles are pithily stated by Glass JA (Fernandez v Tubemakers of Australia Ltd [1975] 2 NSWLR 190 at 197, citations omitted. An appeal to the High Court was dismissed: see Tubemakers of Australia Ltd v Fernandez (1976) 50 ALJR 750):
“The issue of causation involves a question of fact upon which opinion evidence, provided it is expert, is receivable. But a finding of causal connection may be open without any medical evidence at all to support it…, or when the expert evidence does not rise above the opinion that a causal connection is possible…The evidence will be sufficient if, but only if, the materials offered justify an inference of probable connection. This is the only principle of law. Whether its requirements are met depends upon the evaluation of the evidence”.
Upon reviewing the expert evidence in that case, evidence in similar terms to that of Dr Joseph and Dr Gandevia now before me, the learned President said:
Each expert frankly admitted that he could not suggest what caused mesothelioma, and that when speaking of a greater or lesser likelihood he was addressing a mere statistical probability. When the key passages referring to “cumulative exposure” are examined, they show the two experts honestly and consistently reaffirmed their agnosticism on the matter.
The President earlier said:
The probabilities (in a statistical sense) clearly favoured liability being sheeted home to the parties who employed Mr Walsh before the fourth (Hatrick) and fifth (ICI) defendants did.
It is here that the evidence of Dr Berry becomes relevant. In McCusker, Dr Berry gave evidence of what is known as the Peto Formula. Epidemiological studies have found that the mesothelioma rate increases exponentially according to time since first exposure so that Rate = ct^k where c is proportional to the duration and concentration of exposure, t is the time elapsed since the commencement of that exposure and ^k is a constant which has differed slightly in various studies but which is generally about 3. In his report he said:
For an occupational history that consists of a sequence of periods of exposures [this formula] can be used to calculate the relative contribution of each period of exposure to the risk of a mesothelioma at the diagnosis date.

I set out below a table based upon the Peto Formula and the evidence in this case. Because the plaintiff was exposed only intermittently to asbestos in his work as a fitter I have assumed that the concentration of exposure was one half of that concentration to which he was exposed after he became a ships engineer.
The plaintiff worked as a fitter for seven years commencing in 1946. He worked as a ships engineer for six years commencing in 1954 before commencing with Burns Philp. He worked as a ships engineer for ten years with Burns Philp commencing in 1960. The last three years with which we are now concerned commenced in 1967. His mesothelioma was diagnosed in 1998.
Where rate = ct ^k and
c = proportionate exposure multiplied by years of exposure
t = time in years between commencement of exposure and diagnosis.
^k = 3

Occupation

c

t

Rate

Fitter

1 x 7 years

52 years

9842568 = 33%

Ship engineer

2x6 years

44 years

1022208 = 35%

Burns Philp 1960-1966

2x7 years

38 years

768208 = 26%

Burns Philp 1967-1970

2x3 years

31 years

178746 = 6%

Upon my calculations and the evidence in this case the statistical probability is that Mr Bullen’s mesothelioma is less likely to have been caused by his exposure with Burns Philp than a combination of the other two causes. It is however far more likely to have resulted from his cumulative time as a ship’s engineer than from his work as a fitter. The plaintiff worked for 16 years as a ship’s engineer and 10 of those were in the employ of Burns Philp. In that circumstance I accept the opinion of Dr C E Clarke and Professor Shilkin that this employment materially contributed to his disease.
The next question is whether the fibres contributed by Blackwoods’ products in the three years 1967-1970, which I have found to be 5 per cent of the plaintiff’s total fibre burden at Burns Philp, constituted a material contribution to his disease. The cross claimants have called no expert evidence in this regard. Would Mr Bullen have succeeded on the issue of causation had he sued Blackwoods? His mesothelioma is upon my findings and those of Maguire J the result of a continuous cumulative set of circumstances over 10 years in the employ of Burns Philp. The fibres of Blackwoods are tortiously inculpated in only three of those years and even then contributed only 5 per cent of the toxic fibres inhaled by the plaintiff in that period.
Put another way, the Blackwoods fibres contributed one twentieth part to that statistical probability of 6 per cent based on the Peto Formula, that the last 3 years of the plaintiff’s employment with Burns Philp caused his disease.
Even if all fibres were inculpated in the aetiology of the disease it may be calculated upon the history and the relative weightings I have given to fitting and engineering respectively that Blackwoods’ fibres account for only 0.8 per cent of the plaintiff’s total fibre burden.
I am conscious of the perils of basing any legal finding of fact upon theoretical mechanistic formulae. However where the result of application of the Peto Formula accords with justifiable inferences based upon the quantitative evidence of asbestos exposure and the evidence of Dr Gandevia and Dr Joseph that earlier exposures are more relevant than later exposures in tracing the aetiology of mesothelioma I feel that the such application is useful in resolving contests such as the present.

Conclusion

I am unpersuaded that breach of duty owed by Blackwoods to the plaintiff caused or materially contributed to his disease. There is to be judgement for the cross defendant J Blackwood and Son Ltd.
I will hear the parties on costs.

Mr G F Little SC instructed by Connery & Partners appeared for the cross claimant
Mr G M Watson instructed by Allen Allen & Hemsley appeared for the cross defendant

Occupation	c	t	Rate
Fitter	1 x 7 years	52 years	9842568 = 33%
Ship engineer	2x6 years	44 years	1022208 = 35%
Burns Philp 1960-1966	2x7 years	38 years	768208 = 26%
Burns Philp 1967-1970	2x3 years	31 years	178746 = 6%