Langmaid v Dobsons Vegetable Machinery Pty Ltd
[2014] TASFC 6
•4 July 2014
[2014] TASFC 6
COURT: SUPREME COURT OF TASMANIA (FULL COURT)
CITATION: Langmaid v Dobsons Vegetable Machinery Pty Ltd [2014] TASFC 6
PARTIES: LANGMAID, Andrew Kevin
and
LANGMAID, Kevin George
trading as CHERRY HILL COOLSTORES
LATROBE COOL STORES PTY LTD
v
DOBSONS VEGETABLE MACHINERY PTY LTD
FILE NO: FCA 571/2013
JUDGMENT
APPEALED FROM: Langmaid v Dobsons Vegetable Machinery Pty Ltd
[2013] TASSC 23
DELIVERED ON: 4 July 2014
DELIVERED AT: Hobart
HEARING DATE: 14 November 2013
JUDGMENT OF: Blow CJ, Porter and Pearce JJ
CATCHWORDS:
Torts – Negligence – Essentials of action for negligence – Damage – Causation – Other cases – Process of inferential reasoning from circumstantial evidence – Cause of fire in potato grading shed.
Aust Dig Torts [62]
REPRESENTATION:
Counsel:
Appellants: M E O'Farrell SC and T D Cox
Respondent: K E Read SC
Solicitors:
Appellants: Wallace Wilkinson & Webster
Respondent: Page Seager
Judgment Number: [2014] TASFC 6
Number of paragraphs: 174
Serial No 6/2014
File No FCA 571/2013
ANDREW KEVIN LANGMAID & KEVIN GEORGE LANGMAID t/as CHERRY HILL COOLSTORES, LATROBE COOL STORES PTY LTD v DOBSONS VEGETABLE MACHINERY PTY LTD
REASONS FOR JUDGMENT FULL COURT
BLOW CJ
PORTER J
PEARCE J
4 July 2014
Orders of the Court
The appeal is allowed.
The judgment dated 31 May 2013 is set aside.
Judgment be entered for the appellants against the respondent for damages to be assessed.
The action be remitted to the trial judge for the assessment of damages.
Serial No 6/2014
File No FCA 571/2013
ANDREW KEVIN LANGMAID & KEVIN GEORGE LANGMAID t/as CHERRY HILL COOLSTORES, LATROBE COOL STORES PTY LTD v DOBSONS VEGETABLE MACHINERY PTY LTD
REASONS FOR JUDGMENT FULL COURT
BLOW CJ
4 July 2014
In the early hours of the morning of 29 March 2006 there was a major fire in some industrial premises at Cherry Hills Road, Latrobe. Two of the appellants, Andrew Langmaid and Kevin Langmaid ("the Langmaids"), had been carrying on a business named Cherry Hill Coolstores at those premises. That business concerned the purchase, grading, sale, and storage of potatoes. The other appellant, Latrobe Cool Stores Pty Ltd, owned the premises and some equipment there. On the previous afternoon, employees of the respondent, Dobsons Vegetable Machinery Pty Ltd, had been working on the premises, modifying some equipment. That work included cutting, grinding and welding metal. Their work caused sparks, and spattering of hot metal and slag. The appellants contend that the fire resulted from that "hot work" carried out by the respondent's employees. They sued the respondent for damages in relation to the fire, alleging breaches of statutory duty, negligence, and breaches of contract. The action was tried by Tennent J. Her Honour was not satisfied on the balance of probabilities that there was a causal relationship between the respondent's work and the fire. She therefore dismissed the action: Langmaid v Dobsons Vegetable Machinery Pty Ltd [2013] TASSC 23. The appellants contend that her Honour made various errors; that the fire resulted from acts and omissions of the respondent and its employees; and that judgment should be entered for them against the respondent.
The evidence at the trial
The evidence relied on by the appellants as to the cause of the fire was wholly circumstantial. Many of the primary facts were not disputed at the trial. Those undisputed facts included the following:
· On the day before the fire, 28 March, employees of Cherry Hill Coolstores and employees of the respondent were working on the modification of a grading line – a piece of machinery that was used to convey and sort potatoes. The grading line ran north-south along the eastern wall of the building that housed it.
· The employees of the respondent who worked on the modification of the grading line that day were Rodney Maine and Scott Nalder.
· Mr Maine did some work on a chain guard that was connected to the grading line. He cut a piece of metal on a pallet on the floor near the grading line using a 5-inch grinder. Sparks were emitted as a result of that cutting. He finished the cutting at about 6pm. He then welded the piece of metal into position, and welded a block onto it. He then used a cordless drill to install some screws. He finished work on the guard at about 7pm.
· There were a number of combustible items in the area where Mr Maine did that work. There was a wooden bin, designed to hold one tonne of potatoes, that was being used to hold up a new conveyor. There were the rubber rollers and the belt of that conveyor. There was also a plastic bucket.
· After finishing work on the guard, Mr Maine packed up and put tools away. He put the welder in the wooden box. Before he left, he neither saw nor smelled anything to indicate a fire. However he did not look for any signs of fire before leaving the grading area that night. He left with Mr Nalder at about 7.45pm.
· Mr Nalder also used welding equipment on the afternoon of 28 March. He worked about halfway along the grading line. He finished his work at about 7pm. He did not see or smell any sign of fire. He cleaned up and put tools away before leaving with Mr Maine.
· An employee of Cherry Hill Coolstores named Michael Cooper was in charge of the grading shed on 28 March. On that afternoon he made a cut in the conveyor using a 5-inch angle grinder. That generated sparks. The wooden box and the plastic bucket were each less than a metre away. He finished that work at about 4pm.
· The appellant Andrew Langmaid came to the premises at about 7.45pm on 28 March. No one else was there. He spent about four or five minutes in the vicinity of the grading line before leaving. He was the last person known to have gone onto the premises before the fire.
· The fire was first reported to the Tasmania Fire Service ("the TFS") by a security guard who saw it from a distance. He phoned to report it at 2.59am on 29 March.
· At 3.09am TFS officers observed that the fire was burning well in the centre of the building that housed the grading line. It appeared to be moving from the eastern to the western side of the building, away from the grading line area.
· After the fire, the eastern wall of the building displayed a partial "V" pattern, indicating that the fire had burned at a low level at the northern end of the grading line, and then burned up and out in the shape of a "V" towards the southern end of the grading line.
· In an area above the northern end of the grading line, there had been complete destruction of the timber battens to which the metal supports of the roof were attached, with the result that the roof had collapsed onto the grading equipment. There was obvious heat damage to the metal part of the roof structure, which was discoloured and bent.
At trial the appellants relied on expert opinion evidence from three witnesses – a fire investigation officer from the TFS named Claudio Muench, a professional fire scene examiner named Murray Thomas, and a welding expert named Glen Allan.
Mr Muench's opinions about the fire can be summarised as follows:
· It was possible to establish an area of origin, as distinct from a point of origin.
· The area of origin was the vicinity of the northern end of the grading line.
· There was an electrical switchboard nearby, but his observations of that switchboard led him to conclude that the fire had not originated from the area of the switchboard.
· There was an electric welder in the area of origin, but he eliminated it as a possible ignition source because his observations indicated that it had not been plugged in, and that was confirmed by employees of the respondent.
· There was an office building containing computer equipment near to the area of origin. Examination of that area and the equipment in it failed to provide any evidence of the fire originating from that area.
· The most probable cause of the fire was either weld slag or grinding sparks which had caused undetected smouldering which ultimately generated sufficient flame and heat to enable the spread of the fire.
· The original source of fuel for the fire was most likely the rubber components of the grading line.
Mr Thomas reached a similar conclusion as to the area of origin. In a report tendered in evidence, he said that his observations suggested to him that "the fire originated very near the right side of the roller fitted to the new grading equipment within the area of fire origin". His conclusions as to the most likely cause of the fire were expressed in that report as follows:
"Taking into consideration the nature of the combustible materials in the determined radius of fire origin the most likely heat source responsible for this fire would be molten metal or by products of cutting or welding in the immediate vicinity of the front roller of the grading equipment. The main reason I detail this as being the most likely heat source is that such hot materials may have inadvertently lodged in a location where they have retained heat due to the confined areas concerned and eventually raised available combustibles to their ignition temperature. The burn indicators are totally consistent with a 'slow heat build up fire'. The severe overhead damage directly above the roller was restricted to an area of approximately 450 millimetres in width. A 'baking effect' has occurred prior to significant flaming combustion eventuating."
Mr Allan gave uncontroversial evidence to the following effect:
· Using a 5-inch grinder to cut mild steel would produce hot metal particles and sparks.
· Welding would produce hot spatter and sparks.
· From the grinding operation, a characteristic smell would be produced by hot steel and bonding agents in the cutting/grinding disc.
· The welding operation would produce various gases and a characteristic smell, but no strong residual smell would be expected.
At the trial the respondent called as a witness a man named Sean Bassett who worked as a senior technologist for a firm named AWTA Product Testing. His firm had been commissioned by the respondent to conduct some tests during which grinding, welding and oxyacetylene equipment were used near wood, conveyor rubber, and plastic buckets. He supervised re-enactment tests that were designed to replicate the activities that had occurred in and around the grading line on 28 March 2006. One of the various tests involved heating a metal nut with an oxyacetylene torch until it was red hot, and placing it between a rubber roller cover and a rubber conveyor belt. He expressed opinions to the following effect:
· It was highly unlikely that the combustible parts of the grading line could have been ignited by sparks from either a welder or an angle grinder of the types used.
· Testing showed that it was "relatively difficult" to get those parts to ignite and that, when they did, they self-extinguished and the flame did not spread.
· If those parts did ignite, it was unlikely that smoke and odour would not have been noticed by anyone nearby.
· It was unlikely that the sparks from a welder or a grinder, if they came into contact with a plastic bucket or some timber, would lead to either an ignition or an escalation of fire.
· It was unlikely that a fire starting in a plastic bucket would have remained unnoticed because of the odour and smoke that would be released. Mr Bassett observed that, once the plastic bucket ignited, it did not self-extinguish but had to be put out.
· It was unlikely that a fire could have started at some time after a spark landed in a wooden container.
A Victorian fire investigation expert named Neil Barnes gave evidence for the respondent at the trial. His opinions included the following:
· The area of origin of the fire was likely to be in the north end of the building.
· The point of origin of the fire could not be identified.
· It was unlikely that the activities of either Mr Maine or Mr Cooper caused or contributed to the fire.
· Had the fire started as Mr Thomas believed, gases with a particularly acrid smell would have been produced, and would have been smelt by the persons present.
The learned trial judge found Mr Barnes to be a most unimpressive witness. She criticised him for making superficial enquiries, disputing first-hand observations made by Mr Muench when he had not attended the scene at all, missing a number of significant points, and not having watched videos of the tests undertaken by Mr Bassett and his firm.
The conclusions of the trial judge
The learned trial judge considered a number of hypotheses as to the cause of the fire. She rejected some but not others. She did not rule out the possibility that the fire had been caused by the work undertaken by Mr Cooper. She did not rule out the possibility that the fire had been caused by the work undertaken by Mr Maine. However she reasoned that the testing done by Mr Bassett's firm suggested that the type and duration of hot work undertaken by both Mr Cooper and Mr Maine were unlikely to have resulted in the fire and that, if the work of one of them did cause the fire, it was just as likely to have been Mr Cooper's work as Mr Maine's work. As a result, her Honour concluded that she was not satisfied on the balance of probabilities that the hot work of the respondent's employees caused the fire. She reasoned that it followed that the appellants' claims should therefore fail. She considered it unnecessary to determine whether there had been any breaches of any statutory duty, contractual term, or duty of care.
The appellants' contentions as to errors
The appellants' notice of appeal contains 18 grounds of appeal, several of which include multiple sub-grounds. There is a lot of overlapping and repetition in the document. The appellants' contentions are essentially as follows:
· That the learned trial judge was obliged to begin by determining what duties were owed by the respondents to the appellants, and whether there had been any breaches of the pleaded statutory duties, contractual terms, and duties of care.
· That it was impermissible to make a finding as to whether the work done by the respondent's employees caused the fire, and then to consider the legal consequences of that finding.
· That her Honour ought to have been satisfied on the balance of probabilities that the acts or omissions of the respondent's employees caused or contributed to the fire.
· That her Honour made a number of errors in the reasoning that led to the opposite conclusion.
· That her Honour erred in failing to consider pleaded allegations that the respondent and its employees failed to conduct an inspection after their work ceased; that that failure amounted to a breach of the respondent's various pleaded duties; and that there was a causal connection between that failure and the fire.
Breaches of the respondent's duties
The Langmaids claimed damages for breach of contract. If a plaintiff proves a breach of contract, but not that any damage was occasioned by the breach, nominal damages are recoverable: Luna Park (NSW) Ltd v Tramways Advertising Pty Ltd (1938) 61 CLR 286. It follows that the learned primary judge had a duty to determine whether there had been a breach of contract on the part of the respondent. She erred in law by failing to make any such determination. If she made no other error, her failure to determine whether there was a breach of contract may have no practical consequences.
So far as the appellants' claims for damages for breach of statutory duty and negligence are concerned, the position is different. In my view there is nothing impermissible in a trial judge making findings of fact first, and considering the legal consequences of those findings, to the extent necessary, after those findings have been made. Thus, in Amaca Pty Ltd v Booth (2011) 246 CLR 36, a case about liability for damages for negligence, Gummow, Hayne and Crennan JJ said at [64]:
"… as Windeyer J observed in The National Insurance Co of New Zealand Ltd v Espagne the notion of cause and consequence 'is a necessary element in law, especially in the law of crime and tort'. Two issues commonly arise: first, the identification of the cause or causes of a particular occurrence or state of affairs; and, secondly, whether a legal right or liability is engendered by any one or more of those outcomes." [Footnotes omitted.]
However, because there was a claim in contract, the appropriate course is for this Court to make its own determination as to whether the respondent breached any contractual duty asserted in the statement of claim.
The respondent admitted that it had entered into a contract with the Langmaids for, amongst other things, the performance of work to upgrade the entire grading area. No doubt it was an implied term of the agreement that the respondent would exercise reasonable care and skill: Chin Keow v Government of Malaysia [1967] 1 WLR 813; Costa Vraca Pty Ltd v Berrigan Weed & Pest Control Pty Ltd (1998) 155 ALR 714 at 720. That implied term no doubt required the respondent, by its employees, to take reasonable care to avoid starting a fire, and to undertake a reasonably thorough inspection after their hot work ceased as a precaution against the risk of fire.
Section 11 of the Civil Liability Act 2002 applies to causes of action that accrued at the relevant time. It provides as follows:
"(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."
There was no doubt a foreseeable risk of harm within the meaning of s11(1)(a). The respondent's employees undertook hot work in the vicinity of various combustible items – the wooden box, the plastic bucket, and the rubber components of the grading line. The risk that a spark or some hot spatter would start a fire was not insignificant. The risk of fire could have been obviated by using protective guards to prevent hot work coming into contact with combustible material, undertaking a proper inspection at the site after the hot work had been completed, and wetting down the combustible material in the area of the hot work. Those precautions were required by Australian Standard AS 1674. The risk of a fire was probably very small, but the possible seriousness of a fire was enormous. The precautions required by the Australian Standard were not burdensome. In the circumstances, I am satisfied that there were breaches of contract on the part of the respondent. It follows that the Langmaids must at least be entitled to recover nominal damages.
For the purposes of the appellants' claim for damages for negligence, I accept that the respondent breached its duty of care by failing to take the precautions that I have mentioned.
At the relevant time, reg20(b) of the General Fire Regulations 2000 provided, "A person must … in performing the hot work, observe the requirements of AS1674". That regulation created an offence punishable by a fine. By virtue of reg3(1), "hot work" had the same meaning as in AS 1674. The respondent admitted in its pleadings that the work undertaken by its employees or agents amounted to "hot work" within the meaning of AS 1674. I accept that a contravention of reg20 could form the basis of a cause of action for breach of statutory duty: O'Connor v SP Bray Ltd (1937) 56 CLR 464 at 478. And I accept that the respondent breached the statutory duty imposed by reg20 by failing to comply with AS 1674 in the respects that I have mentioned. The critical question is whether the evidence establishes on the balance of probabilities that the fire was caused or contributed to by any such breach of statutory duty, or any other pleaded breach of duty.
Did the respondent's hot work cause the fire?
The appellants wish this Court to substitute its own findings of fact for those of the learned trial judge. That can be done in an appropriate case, in accordance with the principles discussed by the High Court in Fox v Percy (2003) 214 CLR 118; Suvaal v Cessnock City Council (2003) 77 ALJR 1449; Pledge v Roads and Traffic Authority (2004) 78 ALJR 572; Anikin v Sierra (2004) 79 ALJR 452; Commissioner of Main Roads v Jones (2005) 79 ALJR 1104; and Roads and Traffic Authority v Royal (2008) 82 ALJR 870. It is therefore unnecessary to undertake a detailed analysis of the reasoning process of the learned trial judge in relation to the cause or causes of the fire.
There was nothing to prevent an intruder from entering the building that housed the grading line and starting a fire there. However neither Mr Muench nor anybody else found any evidence suggesting the use of any liquid accelerant, nor any evidence to suggest that the first material to start to burn was something not in the vicinity of the grading line. It would be a very surprising coincidence if, in those circumstances, an intruder had started a fire in the very area where hot work had been undertaken during the afternoon of 28 March.
In my view there is no reason to doubt the correctness of Mr Muench's evidence ruling out the switchboard, electric welder and computer equipment as sources of ignition.
Something had been destroyed in the extreme northeast corner of the building that housed the grading line. Mr Thomas was cross-examined about that, but was unable to say what had been destroyed in that area. The learned trial judge, who no doubt had more of a feel for the case than I have, commented at [119] of her reasons that an unidentified burnt object in that corner was a possible cause of the fire. At [134] of her reasons she said:
"There was also no direct evidence to either include or exclude the possibility that the unidentified pile of burnt remains in the extreme north-eastern corner of the shed, which must have been very close to what had become the northern end of the grading line, might have caused the fire. I mention that only because it was an obvious low point of burning and not significantly far away from the area of severe overhead damage identified."
The evidence of Mr Bassett suggested that it was very unlikely that sparks or hot spatter emitted from cutting, grinding or welding operations, having gone undetected, would have started the fire after a considerable delay. However that was by no means impossible. The exhibits tendered at the trial included extracts from a text book entitled Kirk's Fire Investigation, which was regarded by the experts as authoritative. One of those extracts contains the following comment in a passage concerning hot metals:
"Fire watches after hot-work operations are typically only 30 minutes long, but some smoldering [sic] ignitions from hot-work operations have been known to take hours, instead of minutes, to manifest in a flaming fire."
Having regard to all the evidence as to the possible causes of the fire, I consider that the most likely explanation – or, more accurately, the least unlikely explanation – is that something produced by the hot work operations – either a piece of hot metal, a piece of hot slag, or a spark – smouldered undetected until after Mr Maine, Mr Nalder and Mr Andrew Langmaid had all left the premises, and subsequently caused the fire.
But the critical question is not whether it has been established on the balance of probabilities that hot work caused the fire. The critical question is whether it has been established on the balance of probabilities that the respondent's hot work – that is, the hot work undertaken either by Mr Maine or Mr Nalder – caused or contributed to the fire. One cannot rule out the possibility that the ignition source was a spark generated by Mr Cooper's hot work. One cannot rule out the possibility that the fire was unrelated to anybody's hot work. Having regard to the various possibilities and the evidence relating to them, I am not satisfied on the balance of probabilities that the fire was caused or contributed to by the respondent's hot work.
Counsel for the appellants argued that if there was a breach of duty on the part of the respondent, and if a fire could be caused by that breach, then it should be inferred that the fire was caused by the act or omission constituting the breach. He relied on passages in the judgment of Dixon J (as he then was) in Betts v Whittingslowe (1945) 71 CLR 637 at 649, and in the judgment of French CJ in Amaca Pty Ltd v Booth (above) at [49]. In Betts v Whittingslowe at 649, Dixon J said:
"… the breach of duty coupled with an accident of the kind that might thereby be caused is enough to justify an inference, in the absence of any sufficient reason to the contrary, that in fact the accident did occur owing to the act or omission amounting to the breach of statutory duty. In the circumstances of this case that proposition is enough."
That case concerned an injury to the arm of a boy who was operating a machine. There were various theories as to how the accident happened. The High Court concluded that it should be inferred that the injury was caused by a breach of statutory duty on the part of the boy's employer. The case is not authority for the proposition that evidence of a breach of duty coupled with damage that might thereby be caused is always enough to justify an inference that the damage resulted from the breach. Whether such an inference should be drawn will depend on the circumstances of the particular case. A value judgment always needs to be made as to whether the inference should be drawn or whether, in the words of Dixon J, there is "sufficient reason to the contrary".
In this case, I consider that the evidence establishes breaches of duty on the part of the respondent, and that the fire could have resulted from those breaches of duty. However, having regard to the unlikelihood of the respondent's hot work having caused something to smoulder without being detected, and having regard to the strength of the chance that the respondent's hot work did not cause the fire, I do not think it appropriate to infer that the respondent's hot work did cause the fire.
Since writing the above paragraphs I have had the advantage of reading the draft reasons for judgment of Porter J, which provide an extremely thorough analysis of the evidence and the case law relating to causation. As Dixon J (as he then was) said in Briginshaw v Briginshaw (1938) 60 CLR 336 at 361:
"The truth is that, when the law requires the proof of any fact, the tribunal must feel an actual persuasion of its occurrence or existence before it can be found. It cannot be found as a result of mere mechanical comparison of probabilities independently of any belief in its reality."
Strong v Woolworths Limited (2012) 246 CLR 182 establishes that probabilistic reasoning can be a sufficient basis for actual persuasion of the occurrence of an alleged fact. The respondent's hot work may well be the most probable cause of the fire. However I do not "feel an actual persuasion" that it was the cause of the fire.
The inadequate inspection issue
That, of course, is not the end of the matter. The success or failure of the appellants' pleaded causes of action based on breaches of statutory duty and negligence did not depend entirely on whether the appellants could establish that the respondent's hot work had caused the fire. The appellants also contended that the respondent's employees, after they had completed their work, had not thoroughly and adequately inspected the area to ensure that it was safe from the risk of fire. The particulars set out in the statement of claim contain a number of allegations to that effect. It is therefore appropriate for this Court to make findings of fact as to whether an omission by the respondent's employees to undertake a sufficient inspection caused or contributed to the fire. If, when they left the building, there was something smouldering as a result of Mr Cooper's hot work, not theirs, and they failed to detect that smouldering object because of breaches of duties of inspection, the respondent would be liable.
Mr Maine's evidence as to this issue was to the following effect:
· He did not notice any smell or sign of any combustion when he completed his cutting work.
· He did not notice any spatter after his welding, but did not look for it.
· After he finished his work, he unplugged the welder and put it into the wooden box that the conveyor was resting on.
· He left about 45 minutes after he finished his work.
· Between finishing his work and leaving the premises he did not notice any smell of fire or see any sign of fire.
· He did not carry out any inspection for that purpose.
· He and Mr Nalder walked to the south end of the grading line, and then back to the north end, looking for a light switch, before they left.
· They made three or four trips from the north end of the grading line down to their vehicle and back, carrying things out, before they left, without noticing any sign of fire or combustion.
· After Mr Cooper completed his cutting with a grinder that afternoon, Mr Maine did not see or smell any sign of fire or combustion.
Mr Nalder also gave evidence of finishing work at about 7pm, leaving at about 7.45pm, searching for light switches, and not seeing or smelling any sign of fire. He was not asked whether he conducted an inspection with a view to ensuring there was no risk of fire.
Andrew Langmaid gave evidence that he arrived in the grading shed at about 7.45pm on 28 March, that he expected to find the respondent's employees there, and that he had just missed them. He said that he turned the lights on and took a broad overview of the grading line, that he was there for four or five minutes, and that he walked along the western wall of the grading shed from one end to the other, turned around, and walked back out. There had been discussions about recommissioning the grading line during the next day, and he was thinking about what had to happen in the morning. It can be inferred that he did not see or smell any fire or smouldering.
Thus Mr Maine, Mr Nalder and Mr Andrew Langmaid each walked up and down the grading line between six and seven hours before the fire was seen and reported, without any of them seeing or smelling any fire or smouldering. If something was smouldering at that time, it seems likely that it was very small, and in a very protected position where it did not cool down as a result of exposure to the air. I am therefore not satisfied that a reasonably thorough inspection between 7pm and 7.45pm would necessarily have resulted in any smouldering being noticed. I accept that the respondent had a duty that required its employees to make a reasonably thorough inspection of the premises before they left in order to guard against the risk of fire, but I am not satisfied that a failure to undertake such an inspection was of any consequence. If something was smouldering, it may have been so small and so well concealed that it could only have been detected by inspecting every square millimetre of every surface with a magnifying glass. The respondent was required only to take such precautions to avoid the risk of fire as were reasonable, not to go to every possible length to avoid the risk of fire.
It follows that I am not satisfied on the balance of probabilities that any damage was suffered by the appellants as a result of the respondent, by its employees, failing to undertake a reasonably thorough inspection after their work ceased.
Conclusion
For these reasons, I consider that the appellants were not entitled to recover damages for breach of statutory duty or for negligence, and that only nominal damages can be recovered for breach of contract.
The respondent had a contract only with the Langmaids, and not with the other appellant, Latrobe Cool Stores Pty Ltd, who was their landlord. It was not argued that any exception to the doctrine of privity of contract would entitle the landlord to recover damages for breach of contract in this case. I therefore do not propose to consider whether one should. For the reasons stated, the appeal must succeed, but only to the extent that the Langmaids should recover nominal damages for breach of contract.
For these reasons I would allow the appeal, set aside the judgment insofar as it relates to the appellants Andrew Kevin Langmaid and Kevin George Langmaid, and order that judgment be entered for those appellants against the respondent for $1 each.
File No FCA 571/2013
ANDREW KEVIN LANGMAID & KEVIN GEORGE LANGMAID t/as CHERRY HILL COOLSTORES, LATROBE COOL STORES PTY LTD v DOBSONS VEGETABLE MACHINERY PTY LTD
REASONS FOR JUDGMENT FULL COURT
PORTER J
4 July 2014
I have had the advantage of reading the draft reasons for judgment of Blow CJ. The background to the issues in the trial, the relevant evidence, the essential conclusion of the trial judge, and a summary of the appellant's complaints are set out in those reasons. In general terms, I respectfully adopt his Honour's outline, and for immediate purposes there is no need for me to repeat any of it, but I will expand on it where necessary.
I agree with what the Chief Justice has written about some of the issues in the appeal but regrettably, I have reached a different view on the key issue of causation, and hence as to the ultimate outcome. I will deal with the issues in the order of the trial judge's general approach, breach of duty, and causation.
The trial judge's approach
As summarised by the Chief Justice, the appellants' complaints as to this point are essentially as follows.
· The trial judge was obliged to begin by determining what duties were owed by the respondent to the appellants, and whether there had been any breaches of the pleaded statutory duties, contractual terms, and duties of care.
· It was impermissible to make a finding as to whether the work done by the respondent's employees caused the fire, and then to consider the legal consequences of that finding.
In her reasons, the trial judge identified the issues in the trial in these terms:
"22Notwithstanding that there were three bases for the plaintiffs' action against the defendant, what underpins them all is that the plaintiffs need to prove that:
· the defendant carried out certain activities, and/or
· the defendant was responsible for certain failures, and
· there was a causal connection between any activities or failures of the defendant found to have occurred and the fire.
…
23There was no dispute between the parties that the central issue on this trial was causation."
Later, her Honour said:
"114As I have already outlined, three separate causes of action have been pleaded by the plaintiff. These are breach of statutory duty, breach of contract and negligence (involving a breach of duty). Even if the plaintiffs satisfy the Court that there was some form of breach, they cannot succeed in this action unless the Court is satisfied on the balance of probabilities that any breach resulted in the fire. It is that last issue which is central to this case.
115To determine whether any particular breach, if such breach be proved, caused the fire, it is first necessary to determine, if possible, how and where the fire started. If it cannot be determined how the fire started, it would not be possible to establish a causal connection between failures or activities of the defendant and the fire."
The appellants argue that having correctly identified the issues, the approach set out in the later paragraphs is incorrect. They argue that had her Honour identified the respondent's failures, asked whether but for those failures, the appellants would have suffered damage, and whether the damage caused was of a kind that might arise from those failures, "the only inference justified on the evidence was that it was the respondent's failure that caused the damage".
The appellants' argument starts with s13(1)(a) of the Civil Liability Act 2002 which provides:
"13 General principles
(1) Prerequisites for a decision that a breach of duty caused particular harm are as follows:
(a) the breach of duty was a necessary element of the occurrence of the harm ('factual causation');
…".
This, it is said, supports the proposition that whether there has been a breach of duty must be determined before the factual causation inquiry. As an aspect of the argument, the appellants rely on what is said to be the general principle that "the breach of duty coupled with an accident of the kind that might thereby be caused is enough to justify an inference, in the absence of any sufficient reason to the contrary, that in fact the accident did occur owing to the act or omission amounting to the breach". The quotation is taken from the judgment of Dixon J in Betts v Whittingslowe (1945) 71 CLR 637 at 649.
As I understand the way in which the argument was ultimately put, the appellants say that the trial judge was first required to determine the question of whether relevant duties had been breached by the respondent, without which the inquiry into factual causation could not be properly informed; alternatively, at the least, the trial judge failed to properly identify what acts or omissions of the respondent might have constituted a breach of any pleaded duty.
In terms of the general principle, I agree with Blow CJ that there is nothing impermissible in a trial judge first making findings of fact about whether there is a causal connection between conduct around which breaches of duty are alleged and damage, and going on to consider the legal consequences of those findings to the extent necessary: Amaca Pty Ltd v Booth (2011) 246 CLR 36 per Gummow, Hayne and Crennan JJ at 60 [64]. That is particularly so where there is no real argument about the existence of the pleaded duties and about breaches of those duties.
The acts and omissions which were alleged to amount to breaches of duty were clearly identified in the pleadings. One way or another, they all related to the respondent's performance of hot work. If no causal link between the hot work and the fire was established, the appellants' case failed. Further, I am not persuaded that the trial judge proceeded on an insufficient analysis of the acts or omissions relied on.
Breaches of duty by the respondent?
The pleaded breaches of statutory duty, general law duty, and of contract are set out in the trial judge's reasons at [4] – [15]. Central to the pleaded breaches was an alleged failure to comply with reg20 of the General Fire Regulations 2000 by, in turn, failing to comply with Australian Standard AS 1674.1, (pleaded and generally referred to as AS 1674). Regulation 20 provided that a person must, in performing "hot work", observe the requirements of AS 1674. "Hot work" was defined in AS 1674 to mean "grinding, welding, thermal or oxygen cutting or heating, and other related heat-producing or spark-producing operations".
The terms of AS 1674 identified as relevant were as follows:
"2.4 INSPECTION OF SITE Before hot work commences, the site shall be thoroughly inspected and made safe, or alternative methods of carrying out the work shall be adopted.
On completion of hot work, a thorough inspection of the site shall be carried out to ensure that the site is safe.
…
2.7 OFF-CUTS AND ELECTRODE STUBS Before any hot work commences, arrangements shall be made to prevent any work off-cuts, hot metal, slag or electrode stubs from lodging in places where there is any possibility of starting a fire.
2.8 TIMBER Where any hot work is to be carried out adjacent to or above timber, the timber shall be protected, by wetting or other suitable means, from the direct heat of any flame or arc and from sparks, slag and hot metal particles.
…
2.10 OTHER MATERIALS Where hot work is to be carried out in the presence of other materials, care should be taken to protect the surfaces of those materials from damage or from starting a fire.
…
2.12 PROTECTIVE GUARDS Protective guards shall be stable, of ample size and arranged so as to prevent sparks, slag and hot metal particles from rolling beneath them or penetrating openings in them. Protective guards shall be of fire-resistant material.
…
5.3 FINAL INSPECTION After hot work has been completed, inspections shall be carried out to ensure that no smouldering materials remain."
The particulars of negligence and breach of agreement went beyond a failure to comply with reg20 of the General Fire Regulations, and somewhat broadened the allegations. These particulars included allegations that the respondent:
· Caused hot products to fall or lodge in places where there was a possibility of starting a fire.
· Failed to use any or any protective guards to prevent hot products lodging in places where there was a possibility of starting a fire.
· Failed to shield or adequately shield material (including combustible material) in the vicinity of the works from hot products.
· Failed to shield material (including combustible material) in the vicinity of the works with non-combustible welding drapes.
Leaving aside the inadequate inspection issue as it relates to the time after hot works were done, it seems to me very plain that on the facts before the trial judge, the respondent breached its statutory duty, its duty of care, and implied terms of the contract by failing to comply with cls 2.4, 2.7, 2.8 and 2.12 of AS 1674. I agree with Blow CJ on this aspect of the appeal.
The inadequate inspection issue
As to the "inadequate inspection" issue, I also agree with the reasons of the Chief Justice, subject to one matter which affects the approach but not the conclusion. That matter is the standard of care in relation to the allegation of breach of statutory duty; that is, what is required to discharge the obligation imposed by AS 1674, and in turn, by reg20 of the General Fire Regulations.
Unlike, for instance, reg40 of the Work Health and Safety Regulations 2012[1], reg20 of the General Fire Regulations was not conditioned or qualified by any notion of reasonableness. Regulation 20 says that a person must observe the requirements of AS 1674. The Standard itself contains two separate directions that after hot work has been completed, inspections of the site shall be carried out. The first direction mandates a "thorough" inspection "to ensure that the site is safe"; the second requires an inspection to be carried out "to ensure that no smouldering materials remain".
[1] 40 Duty in relation to general workplace facilities
I am unable to agree that what would be needed to satisfy the inspection obligations is a reasonably thorough inspection in the circumstances.
In the context of health and safety legislation, the word "ensure" has been given its ordinary meaning of "to make sure or certain" or "to warrant or guarantee": Director of Public Prosecutions (NSW) v Illawarra Cashmart Pty Ltd (2006) 67 NSWLR 402 at 412 [65] – [66]; Wilton v Cole & Allied Operations Pty Ltd (2007) 161 FCR 300 at 371 [145] (both citing Carrington Slipways Pty Ltd v Callahan (1985) 11 IR 467 at 470); St Vincent's Hospital Toowoomba Ltd v Hardy [1998] QCA 86. The use of the directive "to ensure" that a state of affairs exists or does not exist indicates a high standard of care: McMillan Britton & Kell Pty Ltd v WorkCover Authority of New South Wales (1999) 89 IR 464 at 480.
Even accepting, however, that the standard of compliance is higher than what is reasonable in the circumstances, I share the Chief Justice's view that the appellants have not established that a failure to undertake an inspection after the hot work was of any consequence. The way in which the fire must have started, and the slow pace with which it must have developed, becomes more plainly apparent when considering the next question. It is possible that an inspection of the required standard may have revealed combustion, but is equally possible that it may not.
The next question is the one described by Blow CJ as the "critical question" of whether the evidence establishes on the balance of probabilities that the respondent's hot work – that of Rodney Maine or perhaps Scott Nalder – caused or contributed to the fire.
For the reasons which follow, I think that the trial judge erred in her approach to the resolution of the question, and in my view the evidence does establish, on the balance of probabilities, the requisite causal connection between the Mr Maine's activities and the respondent's breach of duty, and the fire. I am conscious that I have not had the advantages of the trial judge. They include the "feeling" of the case which a reading of the transcript cannot fully provide: Fox v Percy (2003) 214 CLR 118 at 125 – 126 [23]. However, in deciding what is the proper inference to be drawn, I have given respect to the conclusion of the trial judge, but I have reached a different conclusion, and I should give effect to it: Warren v Coombes (1979) 142 CLR 531 at 551.
The cause of the fire
The hot work
I will set out what I see to be the significant features of the evidence which lead me to that conclusion.
There are material differences in the type, location and timing of the hot work respectively done by Michael Cooper and by the respondent's Mr Maine. (Mr Nalder was also employed by the respondent and was working with Mr Maine. He did some hot work at about the same time as Mr Cooper but it was at the end of the grading line away from where Mr Cooper and Mr Maine worked, and his activities were not the subject of any great scrutiny.)
Mr Cooper carried out a cutting operation using a grinder. This was on a conveyor under the one on which Mr Maine worked. (The grading line and the conveyors ran south-north.) The northern end of the conveyor on which Mr Cooper worked was supported on a piece of rolled hollow steel (RHS), about 50mm in circumference, and placed laterally across an open wooden 1 tonne potato bin. This was done so that it would be at the right height when it was finally secured in place. (He said it was very possible that he had two PVC buckets supporting the other end to achieve the correct height.)
The end of the conveyor extended over the edge of the box by about 20cm. Mr Cooper made a single downwards cut in the metal on the side of the conveyor. He then snapped out a piece of metal to facilitate the upward fitting of the conveyor. When he did this he was on the eastern side of the conveyor and about 70 – 80cm away from and to the south of the bin. The cut took no longer than 10 seconds, and he said he saw the sparks produced go straight to the ground. He finished this task at "a little bit after" 4pm. He then did some work on the southern end of the line and left the premises at about 7pm.
In contrast, Mr Maine did some cutting work at about 6pm, and perhaps more significantly, welding work on the upper conveyor line. He attached a small guard near the sprocket and roller on the northern end. He said he finished at "about 7 o'clock, but no later than 7 o'clock". The following description of the work is taken from the trial judge's reasons at [55]:
"The work Maine did in relation to the chain guard included cutting a piece of metal on the ground and then welding it, and then welding a block to that. He used a five inch grinder to do the cutting which took him about 30 seconds. … He said he finished the cutting at about 6pm. That cutting was done on a pallet about two to three metres to the west of the grading line. The sparks mainly went straight onto the floor, although he agreed some may have gone to the east towards the conveyor and the wooden box. For the welding which followed, he used a 175 amp gasless MIG welder. The welds took a matter of seconds. To protect the conveyor belt while he welded, he put a piece of plate in between it and where the welding was. After doing the welding, Maine also used a cordless drill to screw some screws in. …".
Four small 50mm welds were carried out, each of which he said took "a few seconds". In its written submissions, the respondent accepts a total welding time in the vicinity of 30 to 60 seconds. Mr Maine's welding works were at the northern end of a conveyor above the one on which Mr Cooper had worked. It follows, and it is accepted by the respondent, that the site of his welding was above the level of the top of the open wooden bin, but not directly above it. Mr Maine's evidence was that where he was doing the welding would have been about 80 – 130cm to the south of the bin. Before he left the premises for the night, he put his welder inside the bin.
Andrew Langmaid gave evidence about the wooden potato bins of the type used by Mr Cooper, and in evidence was a photograph of similar ones. The dimensions of the bins are 180cm long, 120cm wide, and 90cm high. They are made of roughly sawn timber. The sides consist of six separate pine planks with wooden supporting uprights in each corner and in the middle of the longer sides. There are three hardwood timber "runners" underneath so that the bin can be lifted by a forklift truck.
The remnants of the burnt bin can be seen in photographs tendered. Effectively, it was completely destroyed. One photograph, in particular, shows the charred remains of what appear to be the "runners" on the ground in front of and at right angles to the grading line. Mr Maine's welder can be seen on the floor in between the runner remains. The conveyor on which Mr Cooper worked is on, or very close to, the ground, the support of the bin having gone. The piece of RHS can be seen on the floor at right angles to, and under, the approximate end of the conveyor.
The evidence of the circumstances of the work of the two men needs to be put alongside the expert opinion. That has been summarised in the Chief Justice's reasons, but I will highlight some of that, and set out some further material which was before the trial judge. The key matters are the area of the fire's origin, the ignition source, the initial fuel source and the concept of smouldering combustion.
Glen Allan – welding
It is convenient to start with the evidence of the welding expert called by the appellants, Glen Allan. As to the by-products of the cutting operations, Mr Allan said in his proof of evidence:
"The hot metal from cutting with a 5 inch grinder could travel up to ten metres. The hot metal particles and sparks would rapidly lose temperature and velocity as they travelled through the air. Maximum travel depends on angle of trajectory and tip velocity of the grinding disc. While grinding particles could travel more than 3 metres from the point of cutting, it is not expected that the particles would retain sufficient heat to ignite solid flammable material beyond that distance."
As to the by-products of the welding process as carried out by Mr Maine, Mr Allan said in his proof:
"The spatter and sparks from welding could travel up to ten metres. The hot metal as spatter from welding would lose temperature and velocity as the particles travelled through the air. The spatter particles would be generally significantly larger and hotter than the particles produced by grinding. The initial velocity of spatter particles would be significantly lower than the particles from grinding. The size of spatter particles produced is dependent on a number of welding variables including; welding consumable type, welding consumable size, welding current, welding voltage, contact tip to work distance, arc travel speed, welding position and direction of travel. Heat retention of the larger spatter particles possibly produced by the FCAW(N) process would be considerably longer than for smaller spatter particles or the consistently finer particles produced by grinding. … The grinding particles and spatter would lose their heat very quickly. Spatter is initially molten, which in the case of steel requires temperatures > 1500˚ C, and loses heat more slowly due to the larger volume of each particle. The size and volume of spatter is not known, however the larger and hence more heat retentive globules would tend to accumulate close to and below the welding point."
In his evidence, Mr Allan clarified the nature of the by-products of the welding process. He said that they are of three types. Some of the flux from the wire, which is the welding consumable, creates gas, whilst some creates a liquid. That liquid is known as slag, whilst spatter is made up of molten metal components. Both will be at temperatures typically well in excess of 1500oC initially. The metal becomes solid at 1500oC.
The particles of spatter can be different sizes depending on their point of origin. Larger particles of spatter can be created by gaseous reactions; they can be "fairly large particles up to two or three millimetres in diameter [which are] at 1500 or higher temperature". Because it is molten, the spatter retains heat. As it cools, a secondary process can occur by way of a reaction with the atmosphere and sparks are created as the spatter travels through the air.
Returning to Mr Allan's proof, in it he sets out a question asked of him as to whether the by-products of cutting and grinding would be capable of insulating or providing combustible load to the wooden bin or PVC bucket. He responds:
"The proximity of the wooden bin and PVC bucket to the welding point are not clear from the information to hand, however if it were possible for larger globules of spatter (if they were produced at all under the welding conditions used on the day) then it is considered possible that combustion could occur."
Mr Allan also said in his proof of evidence that the particular welding process produces various gasses, that there would be a characteristic smell associated with the process, but that no strong residual smell would be expected. He added that it was possible that the "characteristic smell might be sufficient to mask the smell of a small smouldering fire".
Claudio Muench – TFS examiner
Much of the evidence of Claudio Muench, the Tasmania Fire Service fire scene examiner, was contained in a TFS report dated 6 March 2006. That included the following:
"Conclusion
It was evident that the type of hot works being carried in close proximity to potato grading machine left combustible components susceptible to igniting. The most probable cause of the fire was either weld slag or grinding sparks coming into contact with the combustible components of the machine. These in turn smouldered undetected for a period of time before generating sufficient flame and heat to enable the fires spread."
In the report, Mr Muench went on to say that, having considered the evidence gathered, and having eliminated natural, mechanical or chemical causes, the fire was determined to have been caused by work practices.
In his report he considered a number of electrical points and items of interest, but excluded them as causes or areas of origin of the fire. In his oral evidence, Mr Muench agreed that he was not able to identify a point of origin as distinct from an area of origin. The latter "is nowhere near as precise" as the former. By way of illustration, he referred to a room in a structure as an area of origin, whilst a power point within that room which started the fire would be the point.
In the report, Mr Muench identified the area of fire by reference to the northern end of the grading line. The end of the machine itself had been subject to a greater amount of heat than the rest of the machine, and the timber roof purlins had been totally consumed. He noted that the lowest point of charring in the area of origin was not capable of being ascertained due to extensive damage. However, in his evidence, he identified the charred remains of the wooden bin as a low point, and the lowest point in that area.
His report gave the most probable cause as weld slag or grinding sparks coming into contact with the combustible components of the machine. In cross-examination, he was asked to exclude from consideration non-metal components of the grading line which were said to be combustible. His response indicated that his opinion would essentially remain the same, although "we would obviously be looking for another ignition source". He believed that it was the rubber roller at the end of the upper conveyor which ignited first, but he could not ascertain what exactly did so.
Mr Muench was then shown the video footage of the tests carried out by Mr Sean Bassett (AWTA Product Testing) on conveyor rubber on the conveyor mock-up, on wood and on plastic buckets. He accepted that the level of intensity and duration of the heat source from the sparks and welding slag he observed was far higher than he had assumed for the preparation of his report, but did not accept that the demonstrations made it unlikely that sparks or slag "impacted together with the belt to cause the fire". He said that there were other combustible components of the machine, not just the belt.
As to each of the suggested combustible items, being the belt, roller, wooden bin and plastic bucket, it was suggested that if alight, "you would expect each of those to give off a smell which would be detectable to someone who was making an inspection of the machine". Mr Muench said, "potentially, but given the works that were being conducted in the area during the day there would have been certain smells in that area anyway". Detection would depend on sense of smell.
In re-examination, he maintained his opinion that assuming there were combustibles in the area of origin other than the components of the grading machine, hot works caused the fire. He said that welding slag was a more likely ignition source than grinding sparks.
At [78] of her reasons, the trial judge set out a number of other matters which were raised with Mr Muench in cross-examination and re-examination. One of those matters was that Mr Muench did not agree that this was a multi-area origin fire. He confirmed that the most substantial overhead damage was in the area of one to two metres just to the left-hand (or eastern) side of the end of the conveyor on which Mr Maine had worked.
The trial judge did not express any view as to Mr Muench's credibility. It can be assumed that her Honour accepted his evidence. There was nothing to suggest that the import of his evidence was in any way diminished.
Colin Thomas – the appellants' expert
The evidence of the appellants' fire expert, Colin Thomas, was contained in his inspection notes made on the day of the fire, a report dated 18 April 2006, a proof of evidence dated 16 May 2011, a supplemental proof dated 18 August 2011, and his oral evidence. A note of what he thought first caught fire, was interpreted by him to mean that he did not know what it was, but that it had most likely been consumed during the fire. As to the estimated time the fire had been burning before discovery, he made a note "Smouldering ++", which he said meant smouldering for a very long time.
As to his report, he said that the area of origin of the fire was in the immediate vicinity of the front of the grading machine. It is worth setting out most of the "Conclusions" section, part of which is reproduced in the Chief Justice's reasons. Relevantly, the section reads as follows:
12.1The total area affected by fire in this scene was large with the fire damage being severe throughout. Despite this, I am satisfied the area of fire origin is in fact in the 'front quarter' of the grading area situated on the left side[2] of the fire damaged section of the complex.
12.2My detailed examination of the asymmetrical fire damage and burn indicators suggests to me the fire originated very near the right side of the roller fitted to the new grading equipment within the area of fire origin. The burn indicators I refer to are:
· The severe low level fire damage and almost complete consumption of available combustibles in the area described.
· The single sided 'V' patterns which extend in upward and outward movement to the rear and right side of the structure.
· The severe overhead damage directly above the low level fire damage described.
12.3In testing my hypothesis that the fire originated in the area described I am satisfied of this primarily due to the fact the three main indicators used in determining the point of fire origin are consistent with fire originating at this point. Likewise in testing hypotheses that the fire may have originated in any other part of the complex, I could not be satisfied the burn indicators and the asymmetrical fire damage were consistent with any of these hypotheses.
12.4Taking into consideration the nature of the combustible materials in the determined radius of fire origin the most likely heat sources responsible for this fire would be molten metal or by products of cutting or welding in the immediate vicinity of the front roller of the grading equipment. The main reason I detail this as being the most likely heat source is that such hot materials may have inadvertently lodged in a location where they have retained heat due to the confined areas concerned and eventually raised available combustibles to their ignition temperature. The burn indicators are totally consistent with a 'slow heat build-up fire'. The severe overhead damage directly above the roller was restricted to an area of approximately 450 millimetres in width. A 'baking effect' has occurred prior to significant flaming combustion eventuating." [Emphasis added]
[2] As I understand Mr Thomas' evidence, "left" equates with the eastern side.
The features of Mr Thomas' proof of evidence which I want to highlight are as follows.
· The most probable area of the fire was the northernmost end of the grading machine.
· The point of origin was somewhere within the immediate vicinity of the front of the grading machine, very near to the right side of the roller.
· It was not possible to conclusively determine what combustible first ignited, due to the severity of the fire damage and the fact that virtually all combustibles had been completely consumed.
· It was most probable that the combustible first ignited was not the conveyor belt itself.
· The nature of the damage to the roller is consistent with the theory that the fire started on, or very near, to it.
· As to other possible combustibles, in any workshop instalment setting there are usually small amounts of combustibles such as dust, wood shavings, spiderwebs, etc that lodge in corners and underneath equipment:
"Small collections of such debris are, in my opinion more than capable of insulating and providing combustible load to a small heated object such as molten metal or other welding or grinding by-product."
· The burn indicators were totally consistent with a "slow build-up fire", with the severe overhead damage directly above the roller restricted to an area of about 450mm in width. A "baking effect" had occurred prior to significant flaming combustion.
· The fire did not burn quickly during the initial stages. There was considerable evidence to suggest a slow heat build-up during the initial stages, possibly without flaming combustion or minimal flame being generated. Slow heat build-up would have occurred over a number of hours.
· The increase in heat occurs over an extended period of time as a result of the hot material being "insulated" to enable the heat to build up. As the heat increases to within the required range, flaming combustion occurs.
· The most likely heat source was molten metal in the immediate vicinity of the front roller of the grading equipment.
In his supplementary proof, Mr Thomas reiterated that virtually all combustibles had been consumed within the radius of fire origin. The combustible which first ignited had most probably been destroyed, but it was highly possible that the bin or a bucket may well have been the first to ignite. He specifically addressed the nature of the potato bins. He said that wood such as that used in the construction of the bin, and debris within such a bin, are both capable of insulating and providing combustible load to a small object such as molten metal or other welding or grinding by-products.
In his evidence, Mr Thomas indicated the severe low level damage as being the remains of the base of the bin. The state indicated either exposure to fire for a long period of time or exposure to a volume of extreme heat for a longish period of time. Directly, or almost directly, above that low level damage was severe overhead damage. The main feature of that was the complete consumption of the timber involved in the construction of the roof immediately above the end of the grading line.
He was asked to explain the reference to a "slow build-up fire". He replied:
"The burn indicators in this instance … do suggest a slow heat build up fire and what I mean by that is probably a fire where there's been significant heat generated or heat being generated prior to flaming combustion occurring, as opposed to there being flaming combustion at the initial stages of the fire. The reason I say that is because of the quite large structural framing timbers were are above the roller which had been totally consumed; have to be, in my opinion, a slow heat build up fire with those hot gases rising in the convection currents to that point directly above, for that relatively small area of the timbers to have been totally consumed."
In cross-examination, there was a debate about whether the severe overhead damage was directly above the low level damage or slightly off-set. At the end of the exchange, Mr Thomas said that he was satisfied that most of the severe overhead damage was directly above the severe burning low level damage, taking into account the situation of the building, the combustible load, and other relevant factors. By reference to his photographs, Mr Thomas explained that the severe overhead damage is to the north of part of the grading machine. That part, described by the cross-examiner as the "plinth", is part of the eastern side of the grading machine and extends to the north beyond the end of the conveyor lines.
It was put to Mr Thomas that his view was that the bin may well have been the source of combustion. He said that it certainly contributed to the fire; "it's a combustible, it's part of the fuel load, one of the issues with this fire was that there was a limited combustible load in and around the area". Otherwise, he was not challenged about or cross-examined on the statements made in his supplementary proof of evidence to the effect that certain objects and debris could have provided insulation and combustible load to hot metal particles.
In Mr Thomas' case also, the trial judge did not express any view as to his credibility. Similarly, it can be assumed that her Honour accepted his evidence. In my view on reading the transcript, Mr Thomas does not appear to have been in any way shaken or undermined as to his conclusions.
Neil Barnes – the respondent's expert
I do not propose to set out parts of Mr Barnes' evidence. It is examined at length by the trial judge at [83] – [104] of her Honour's reasons. In short, Mr Barnes' opinion was that, although the area of origin of the fire was likely to be in the north end of the building, the point of origin could not be identified and it was unlikely that the activities of either Mr Maine or Mr Cooper caused or contributed to the fire. He did not agree that it was a slow build-up fire and said that, had the fire started as Mr Thomas asserted, gasses with a particularly acrid smell would have had to have been produced, and would have been smelt by the persons present. He did not offer any opinion as to the fire's cause.
The trial judge said that Mr Barnes was a most unimpressive witness and, for reasons which her Honour gave, said that she approached his evidence "with significant caution". I have read Mr Barnes' proof of evidence and the transcript of his oral evidence. Of course, I had not had the benefit of seeing Mr Barnes in the witness box. The trial judge made no reference to his demeanour as such, and it is not clear what, if any, effect that may have had on the credibility finding. However, her Honour's criticisms seem perfectly valid to me.
The respondent did not contend that her Honour's views about Mr Barnes' evidence were not reasonably open. The respondent's argument is that the evidence of Mr Muench and Mr Thomas had limitations and had to be put in the context of all of the other evidence. In my view, there is nothing in Mr Barnes' evidence which impacts on the weight which might be given to the opinion of Mr Muench and Mr Thomas.
Written reference materials
Some extracts from textbooks and papers on fire science, behaviour and investigation were in evidence. The general consensus of the experts seemed to be that they were authoritative. The first reference material is De Haan & Icove, Kirk's Fire Investigation, 7th ed. Hot metals is one of the topics dealt with in relation to ignition sources. At 197 – 198, the authors say:
"As a direct source of ignition of fires, metals are only ever occasionally important. They can play a part as sparks of burning metal from grinding or cutting operations or as droplets of molten metals. Molten metal may carry enough heat to ignite susceptible fuels with which it comes in contact and is therefore capable of starting fires, as are burning fragments. Because a considerable amount of heat is required to melt the metal, such dangers are usually associated only with special operations in metal fabrication. Places in which such operations are carried out are more than normally susceptible to fire from this type of ignition. …
Molten ferrous alloys, such as steel, are far more dangerous than solids because of their high melting temperatures and often higher thermal capacities. Thus, welding and cutting of steel with an arc or a torch in the presence of susceptible organic fuels is a very dangerous practice. … The state of subdivision of a solid fuel is critical in determining its susceptibility. It is, for example, almost impossible to ignite a large timber accidentally by the short, direct application of a torch flame or by the molten metal from it. In contrast, finely divided fuels, such as shredded packing materials, sawdust, shavings, or loose paper may very well be ignited under the same conditions.
…
Fire watches after hot-work operations are typically only 30 minutes long, but some smoldering [sic] ignitions from hot-work operations have been known to take hours, instead of minutes, to manifest in a flaming fire." [Emphasis added]
Earlier, at 33, the authors deal with smouldering combustion. As distinct from flaming combustion which is a gaseous combustion in which both the fuel and oxidiser are gasses, this is described as involving the surface of a solid fuel with a gaseous oxidiser, usually the oxygen in the air. Nearly all destructive fires are flaming combustion, but the smouldering fire is not uncommon, either alone or in combination with flames. "[T]he non-flaming fire in a mattress or a pile of sawdust is a good illustration of a smoldering [sic] fire (which can do extensive damage) … Many destructive flaming fires began as small smoldering fires."
In the summary to the chapter on sources of ignition, the authors say:
"No matter what the nature of the fuel, its susceptibility to ignition, or the duration of the suspect ignition source, it is important to remember that an ignition source must be of sufficient energy and in contact with (or at least capable of transferring heat to) to appropriate fuel long enough to raise the fuel to its ignition temperature to trigger the combustion of that fuel under the ambient conditions present. That combustion may be in the form of a self-sustaining smolder or open flames, and each requires particular conditions. As we have seen flames, arcs, sparks, self-heating, and heated objects can all initiate fires under the right conditions, and all must be considered whenever a fire scene is being examined. It is not enough simply to have an ignition source with a given temperature. The cause of the fire is the source of energy, the first fuel ignited, and the circumstances under which those are brought together that resulted in ignition."
The following propositions are taken from the NFPA[3] Guide for Fire and Explosion Investigations (2008), as used by the TFS. Smouldering is a solid phase burning process which normally includes a thermal decomposition step to create a char, followed by solid phase burning of the char produced. Because all smouldering ignition mechanisms are governed by self-heating laws, there is no generally or widely applicable "standard" ignition temperature that can be assigned. The ignition temperatures for various surfaces are only applicable to the conditions in which they are experimentally determined. They are not generally or broadly applicable. Fuels with a high surface-to-mass ratio are much more readily ignitable than fuels with low surface-to-mass ratios. Examples of high surface-to-mass fuels include dust, fibres and paper.
[3] National Fire Protection Association (US).
Lastly, in Cooke & Ide, Principles of Fire Investigation at 299, smouldering combustion is said to be "a form of flameless combustion which can occur in cellulosic and similar materials capable of charring". Smouldering can occur at very low oxygen concentrations, and proceeds at a very slow rate. The rate of smouldering increases with decreasing particle size and decreasing moisture content. The presence of an air flow can substantially increase the smoulder rate, perhaps by up to 10 times.
The general consensus of the experts seems to be that they were authoritative.[4] It can readily be seen that the body of knowledge revealed by the extracts from this material is manifested in the requirements laid down by AS 1674. Clause 2.7 of the Standard deals with the prevention of (amongst other things) hot metal and slag from "lodging in places where there is any possibility of starting a fire". Clauses 2.8 and 2.10 are directed towards the protection of adjacent materials; timber is specifically the subject of cl 2.8. Clause 5.3 requires a final inspection to ensure "that no smouldering materials remain".
Sean Bassett – the AWTA testing
[4] Mr Barnes thought that the British text, Cooke & Ide, Principles of Fire Investigation, was no longer authoritative as being "too old", but he agreed with the propositions from it which were put to him.
Two reports by Mr Bassett were in evidence. The first, dated 23 May 2011, was about testing conducted on a conveyor belt assembly which was especially made for the purpose. It was a mock-up of the one worked on by Mr Maine. Grinding and welding operations were carried out on the unit above the conveyor. Heat from an oxyacetylene torch was applied to the surface and edge of the conveyor belt. A standard "hot nut"[5] test was carried out on various parts of the conveyor belt and roller.
[5] A metal nut heated to 900oC so that it is "red hot".
As a result of these tests, Mr Bassett expressed the following opinions.
· It was highly unlikely that a conveyor belt unit that was built in the same manner as the test unit could have been ignited by sparks from either a welder or angle grinder of the same type as was used for the onsite testing.
· It was unlikely that the smoke and odour that was given off when either the conveyor belt or the roller cover did ignite could have not been noticed by any operator who was nearby. Even when the conveyor belt/roller cover were smouldering during the last hot nut tests, large amounts of smoke and odour were produced.
The second report is dated 16 August 2012, and relates to tests carried out on a piece of timber and on PVC buckets. The same sorts of tests were carried out. It was Mr Bassett's opinion that it was unlikely that a small amount of sparks from either a welder or a grinder that entered empty tubs would lead to either ignition or escalation of fire. It was unlikely that if a fire started in one of the plastic tubs it would have remained unnoticed due to the odour and smoke released. The section of timber plank which was tested did not ignite under either of the welding or grinding tests, and even when ignited under more onerous conditions, it self-extinguished and did not escalate. In his opinion it was unlikely that a resultant fire could have started at some time after a spark lodged in a container made from such timber. (He did not specifically address welding slag.)
In oral evidence, Mr Bassett confirmed that the purpose of the first test was to see if it was possible that either welding or grinding on the test unit would cause any part of it to ignite and then propagate fire. The purpose of the second test was to determine if it was possible that either welding or grinding in close proximity to the items could cause either an ignition to occur either immediately or cause smouldering that would not be detected and cause ignition to occur at a later time. He also explained the phenomenon of "heat sinks". They are materials which draw heat from a heat source. All of the materials tested were heat sinks. If a spark went under a wooden bin sitting on a concrete floor, the concrete floor would act as a heat sink.
The trial judge initially referred to Mr Bassett's tests involving the use of grinding, welding and oxyacetylene equipment near wood, conveyor rubber, and PVC buckets. Timber was not mentioned. Her Honour set out the whole of Mr Bassett's first report but did not refer at all to the terms of the second. Her Honour noted that in cross-examination "Mr Bassett agreed that there were a number of variables which might affect the outcome of the tests he observed", but that he had added:
"... the one thing to note on that though is even if smouldering had increased or had gone for longer or the ignition had increased or gone for longer our testing showed that there was still smoke and odour …".
The variables which were put to Mr Bassett included such things as the quantity, size and temperature of sparks and spatter, differences in the behaviour of one sample fuel source to another which could be attributable to quality and configuration, sample orientation and airflow. As to the mock-up of the conveyor, Mr Bassett agreed that it was all new parts, that there was no grease or oil, or "wind", and that no external elements were replicated.
Mr Bassett acknowledged that each report concluded with the words set out below; that there was a reason for that qualifier to be there because of the range of variables:
"It should be borne in mind that the opinions expressed in this letter are based on a limited number of observations made on a single sample and may be subject to alterations if more detailed testing was to be carried out. We recommend that you have further testing conducted if the information above is critical to your decisions on this product."
In the trial judge's discussion of the evidence, in apparent reliance on the evidence of Mr Muench and Mr Thomas, her Honour found that the area of origin of the fire was the northern end of the grading line and discounted the computer room, battery chargers and the switchboard, all of which were in the general vicinity of the grading line, as possible causes of the fire. The focus of attention fell on the hot work. At [135] her Honour said:
"Despite the conclusions of Mr Muench and Mr Thomas, this issue must be informed by the evidence of the AWTA testing and Mr Allan. The testing done by Mr Bassett's firm would clearly suggest that the type and duration of hot work undertaken by both Cooper and Maine are unlikely to have resulted in this fire. The aggressive nature of those tests did not produce flames which escalated beyond a matter of a few minutes. Further, there would have been a smell associated with the combustion process and no-one in the shed noticed any such smell despite three people being in there between 7.45pm and about 8pm, …".
In my respectful view, it is not made clear why Mr Bassett's testing was thought to "clearly suggest" that hot work was unlikely to have resulted in the fire, particularly in the face of the evidence of Mr Muench and Mr Thomas which seems to have been accepted. A number of aspects of the cross-examination of Mr Bassett need to be considered.
First, as to the effect of variations between the actual situation and the controlled environment, Mr Bassett agreed that they "absolutely" could have affected the duration of the smouldering. It was then that he went on to speak about smoke and odour. Later parts of his evidence show that when Mr Bassett was using the term "smouldering" he meant observable smoke obviously coming from a heated fuel source. In particular he seems to have used the expression when referring to the process of smoke emission after a flame had been extinguished.
He said that when he used the word "ignition", there was a flame but the word "smouldering" when used in his reports, was something which did not constitute ignition. Mr Bassett said that smouldering combustion was not something he had had a great deal to do with. When the extracts from Cooke & Ide, Principles of Fire Investigation (above) were put to him, he said that the smouldering he was talking about was not the style of smouldering described in the text. He gave the example of a burning cigarette to illustrate the latter type of smouldering.
Mr Bassett agreed with the proposition that it was possible that one spatter particle, if of sufficient size and temperature, could impact with a fuel surface and cause ignition. That is, if the "particle was sufficiently hot enough and managed to lodge and didn't dissipate heat … and the conditions were correct …".
As to the timber, he said that it was a piece sent to him and which was described as pine. He assumed it came from a potato bin. He said that it was potentially the case that the results may have been different from those achieved had the test been on a bin itself and not on the sample piece. Mr Bassett agreed with the proposition that if he tested the wooden bin and produced weld spatter that had got into the wooden bin, the results may well have been different from those produced with a piece of timber.
He also agreed that testing such as those he carried out could not be used to predict fire behaviour. That was due to the complex nature of fire and the external elements which can play a part. He said that laboratory testing was to try to check a material's property under certain conditions, and it could not be used to extrapolate as to what may or may not happen.
Questions of proof – the relevant principles
By virtue of the Civil Liability Act, s13(1)(a), the appellants need to establish that it was more probable than not that the respondent's breach of duty was a necessary element of the fire's occurrence. That involves the drawing of inferences. The discharge of the civil burden of proof was discussed by McDougall J (with whom McColl and Bell JJA agreed) in Nguyen v Cosmopolitan Homes (NSW) Pty Ltd [2008] NSWCA 246. At [55], his Honour summarised the position as follows:
"(1)A finding that a fact exists (or existed) requires that the evidence induce, in the mind of the fact-finder, an actual persuasion that the fact does (or at the relevant time did) exist;
(2)Where on the whole of the evidence such a feeling of actual persuasion is induced, so that the fact-finder finds that the probabilities of the fact's existence are greater than the possibilities of its non-existence, the burden of proof on the balance of probabilities may be satisfied;
(3)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; and
(4)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."
In Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 at 5 – 6, the High Court noted the distinction between the application of the criminal and the civil standards of proof to circumstantial evidence, saying as to the civil standard:
" … you need only circumstances raising a more probable inference in favour of what is alleged. … [W]here direct proof is not available it is enough if the circumstances appearing in evidence give rise to a reasonable and definite inference; they must do more than give rise to conflicting inferences of equal degree of probability so that the choice between them is a mere matter of conjecture …
All that is necessary is that according to the course of common experience the more probable inference from the circumstances that sufficiently appear by evidence or admission, left unexplained, 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 reasonable be considered to have some greater degree of likelihood."
In Jones v Dunkel (1959) 101 CLR 298 Dixon CJ at 304 said that an inference must not be drawn where it is but "a choice among rival conjectures". There must be "… evidence supporting some positive inference … and it must be an inference which arises as an affirmative conclusion from the circumstances proved in evidence and one which they establish to the reasonable satisfaction of a judicial mind". His Honour referred to the above extract from Bradshaw (then unreported but the passage was set out in Holloway v McFeeters (1956) 94 CLR 470 at 480 – 481), and observed:
"But the law which this passage attempts to explain does not authorise a court to choose between guesses, where the possibilities are not unlimited, on the ground that one guess seems more likely than another or the others. The facts proved must form a reasonable basis for a definite conclusion affirmatively drawn of the truth of which the tribunal of fact may reasonably be satisfied."
It follows, of course, that "a court is not authorised to choose between guesses, even on the ground that one guess seems more likely than another or others": ACCC v Metcash Trading Ltd (2011) 198 FCR 297 per Buchanan J at 306 [31]. However, a court is entitled to draw an inference from "even slim circumstantial facts that exist so long as that goes beyond speculation": Progressive Recycling Pty Ltd v Eversham [2003] NSWCA 268 at [7] per Young CJ in Eq (Ipp JA and Davies AJA agreeing); Condos v Clycut Pty Ltd [2009] NSWCA 200 per McColl JA at [68] (Campbell and Macfarlan JJA agreeing).
Expert opinion of a possibility can be used as circumstantial evidence, and a finding of factual causation may be made where 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 justify an inference of probable connection: Fernandez v Tubemakers of Australia Ltd [1975] 2 NSWLR 190 per Glass JA at 197. See also Seltsam Pty Ltd v McGuiness (2000) 49 NSWLR 262 per Spigelman CJ at 274 – 275 [79] – [83] and, in the context of a "fire" case, McDonald v Girkaid Pty Ltd [2004] NSWCA 297 per McColl JA (with whom Beazley JA and Young CJ in Eq agreed) at [103], [107].
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: Seltsam (above) per Spigelman CJ at 276 [89]; McDonald v Girkaid Pty Ltd (above) at [104].
As to the ultimate question of proof on the balance of probabilities by inference, in Lithgow City Council v Jackson (2011) 244 CLR 352 at 386 [94], Crennan J noted that whilst a more probable inference may fall short of certainty, it must be more than an inference of equal degree of probability with other inferences so as to avoid guess or conjecture. Her Honour continued:
"In establishing an inference of a greater degree of likelihood, it is only necessary to demonstrate that a competing inference is less likely, not that it is inherently improbable."
It is no answer to the question of whether something has been demonstrated as being more probable than not to say that there is another possibility open; the determination of the question turns on consideration of the probabilities: Kocis v S E Dickens Pty Ltd [1998] 3 VR 408 per Hayne JA at 430; Strong v Woolworths Ltd (2012) 246 CLR 182 per French CJ, Gummow, Crennan and Bell JJ at 196 – 197 [34]. In this case, it might be shown that it is more probable than not that the respondent's hot work caused the fire, while at the same time acknowledging 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 first appellant's employee, Mr Michael Cooper.
Discussion
It will be recalled that the trial judge approached the resolution of the case on the basis that the appellants could not succeed unless it was established on the balance of probabilities that any breach resulted in a fire. Her Honour said that to determine whether any particular breach, if such breach be proved, caused the fire, it was first necessary to determine, if possible, how and where the fire started. The area of origin of the fire was found to be the northern end of the grading line as described by Mr Muench and Mr Thomas. Her Honour then considered the evidence and discounted the computer room, battery chargers, and the switchboard as being sources or causes of the fire, saying, "That leaves the possibility that by-products of hot work caused the fire."
Her Honour then discussed the hot works as carried out by Mr Cooper and Mr Maine, and considered the AWTA testing. In her concluding remarks, the trial judge set out the passage from Kirk's Fire Investigation which I have highlighted in the extract set out above, and said:
"Unfortunately, the circumstances in which that phenomenon might occur were not explored in any evidence, nor was there any evidence about the number of hours over which this type of smouldering pre-flames might occur."
Her Honour said that there was no direct evidence as to when flames first appeared, and set out the evidence about what was first observed of the fire. She also said that there was "no direct evidence to include or exclude an unidentified pile of burnt remains" in the north-eastern corner of the building might have caused the fire.[6]
[6] This pile seems to have first been mentioned in the cross-examination of Mr Thomas. The pile was in the extreme north-eastern corner of the main building. It was close to but not within the area of origin identified by Mr Muench and Mr Thomas. Mr Thomas said that he could not recall what it was, and that it was severe low level burning but not as severe as further into the building. He said the burn indicators were that the fire extended back to the area in which it was. It was not specifically raised with Mr Muench or Mr Thomas as a cause, or the point of origin, of the fire. Mr Barnes did not suggest that it was either of those things, and it was not the subject of closing submissions. In the appeal, the respondent merely noted that the trial judge had not excluded it as a possible cause. In my view it has no consequence.
Her Honour continued:
"135 Against that background, am I able to be affirmatively satisfied that by-products of hot work carried out by Maine were the cause of the fire? Despite the conclusions of Mr Muench and Mr Thomas, this issue must be informed by the evidence of the AWTA testing and Mr Allan. The testing done by Mr Bassett's firm would clearly suggest that the type and duration of hot work undertaken by both Cooper and Maine are unlikely to have resulted in this fire. The aggressive nature of those tests did not produce flames which escalated beyond a matter of a few minutes. Further, there would have been a smell associated with the combustion process and no-one in the shed noticed any such smell despite three people being in there between 7.45pm and about 8pm, that is about 45 minutes after the last hot work was done. Counsel for the plaintiffs position in essence was, well what else could possibly have caused the fire? It can only have been the hot work, and therefore this fire is down to the hot work of Maine.
136 That is a very simple way to look at this case and, I accept, is an outcome which seems very logical. However what it ignores is that, even if by-products of hot work carried out on 28 March caused this fire, both Cooper and Maine did such work, albeit about three hours apart, and there was no evidence which might clearly inform the Court about how long it might take for hot work by-products falling on combustible materials to go undetected before erupting into flame. For example, hot work by Cooper could have been the offending activity with the fire erupting into flame within a couple of hours after the last person left the shed. That explanation is as likely as that Maine's work was the cause, particularly given no smell identified with fire was noticed by anyone at least until about 8pm.
137 While, therefore, it is quite possible that hot work caused the fire, I cannot be affirmatively satisfied that it did. More particularly, if hot work did result in the fire, I cannot be satisfied that it was the hot work of the defendant's employees which caused the fire."
As I have noted, the appellants must, of course, prove on the balance of probabilities that the respondent's breach of duty was a necessary element of the occurrence of the harm. That involves processes of inference. In this case the exercise may involve a two-stage factual inquiry as to the probabilities of hot work causing the fire, and then as to whose hot work did so, but the ultimate question is whether it has been shown on the balance of probabilities that the respondent's omissions caused the fire.
As to whether hot work caused the fire, the relevant omissions are the same irrespective of whose hot work it was. The appellants call in aid the approach described by Dixon J in Betts v Whittingslowe (above). The question is whether the omissions amounting to the breach, coupled with an accident of the kind that might thereby be caused, is enough to justify a factual inference about a causal link. In Amaca Pty Ltd v Booth (above) at 57 [49], French CJ highlighted the words "that may thereby be caused", and explained that the logic in the approach "encompasses the case of an ex ante probability, of accident given breach, supported by a causal explanation linking breach and accident". Causal explanations can lie in expert evidence. No doubt those explanations can be general, as in that case, or specific.
Whilst in some cases the inference might be drawn on that basis, that is not a rule of law; "It is an aspect of an available process of drawing of conclusions about causation": Bauldserstone Hornibrook Engineering Pty Ltd v Gordian Runoff Ltd [2008] NSWCA 243 per Allsop P (Beazley and Campbell JJA agreeing) at [240]. In Roads and Traffic Authority v Royal (2008) 82 ALJR 870, Kirby J at 888 [88] said that Dixon J in Betts had helpfully explained the way in which a finding of a breach of duty "may open the way for (whilst not compelling) an inference of causation-in-fact."[7] See also Kiefel J at 897 [139] – [140]. For that process to alone justify drawing the inference, "the facts proved need to be compelling": Stitz v Manpower Services [2011] QSC 268 at [109]. "The facts must warrant no other inference inconsistent with a defendant's liability": Betts per Dixon J at 649.
[7] Kirby P dissented as to the outcome, but this statement does not seem controversial.
In this case, the fire was very obviously an outcome of the kind that might well be caused by the failures to comply with cls 2.7, 2.8 and 2.10 of AS 1674. The opinion of both Mr Muench and Mr Thomas, expressed as a matter of probabilities, was that it was caused by hot work.
Arson and electrical faults in various pieces of equipment were excluded as causes. The trial judge found accordingly, and there is no reason to suggest that those findings were unreasonable or for some other reason ought not to have been made. The factual basis for the opinions was not undermined, and the trial judge seems to have accepted their evidence. Even if expressed as a possibility, these opinions, as I have shown, form part of a circumstantial case and may even of themselves form a foundation for an inference to be drawn on the balance of probabilities.
The concept of a hot metal particle causing fire which ultimately led to flaming combustion was explored in the evidence. It was dealt with by Mr Thomas in some detail. Both men were of the view that the fire was of slow build-up. The expert opinion and the body of knowledge showed that smouldering ignitions from hot works have been known to take hours. I do not believe it is correct to say that there was no evidence as to how the "phenomenon might occur", nor do I see that there is any significance in the fact that there was no evidence about the precise number of hours over which the type of smouldering might occur. Different factors would operate in different situations.
Both Mr Muench and Mr Thomas were quite comfortable with the notion that in this case, hot works commenced a combustion which went undetected for a period during which people were present, and which later slowly built into a destructive fire. Mr Bassett accepted the possibility of the fire starting in those sorts of circumstances, and agreed that his testing had its limitations in attempting to assess what did or might happen in a particular environment. It might be noted that his testing did not establish that it was not possible to cause a flame in any of the combustibles he tested.
When considering the question of discovery, the activities of the men involved need to be borne in mind. There was no evidence as to whether Mr Cooper did or did not do anything. Mr Maine said that he did not carry out any inspection for signs of fire. Mr Nalder said that after packing up they inspected the grading line "pretty thoroughly", but that this was because they had to work out what they were going to do the next day. Mr Langmaid was also assessing the stage of the work and was not looking for signs of fire. The failure to detect any smell is explicable by a combination of the stage of combustion, and the expert evidence that the smell might well have been disguised by odours generated by the hot work.
It might be thought that it is unlikely a fire would occur in the circumstances established in this case, but there is a clear distinction between the prospective assessment of a risk of something happening, and the retrospective exercise of making findings of fact about what has happened. In Amaca Pty Ltd v Booth (above) French CJ said (omitting references):
"42 It is necessary, nevertheless, to reflect upon the relationship between risk and causation. In ordinary usage 'risk' refers to a hazard or danger or the chance or hazard of losshttp:// - FTN.11. Assessment of the risk of an occurrence is prospective in character. It can be expressed as an ex ante probability that the occurrence will occur. If quantifiable, that probability may be expressed numerically as a figure greater than 'zero' up to 'one' which denotes certainty. The range of probabilities may be traversed by terms such as 'mere possibility', 'real chance', 'more likely than not', 'highly likely' and, ultimately, 'certainty'.
43 The existence of an association or a positive statistical correlation between the occurrence of one event and the subsequent occurrence of another may be expressed as a possibility, which may be no greater than a 'real chance' that, if the first event occurs, the second event will also occur. The mere existence of such an association or correlation does not justify a statement, relevant to factual causation in law, that the first event 'creates' or 'gives rise to' or 'increases' the probability that the second event will occur. Such a statement contains an assumption that if the second event occurs it will have some causal connection to the first. However, if the association between two events is shown to have a causal explanation, then the conclusion may be open, if the second event should occur, that the first event has been at least a contributing cause of that occurrence. An after-the-event inference of causal connection may be reached on the civil standard of proof, namely, balance of probabilities, notwithstanding that the statistical correlation between the first event and the second event indicated, prospectively, no more than a 'mere possibility' or 'real chance' that the second event would occur given the first event. There may of course be cases in which the strength of the association, as measured by relative risk ratios, itself supports an inference of a causal connection."
Lack of evidence about the precise mechanism of how injury or damage came to be suffered does not necessarily prevent the inference being drawn about the causal link. To begin with, a plaintiff does not have to establish that the precise sequence of events leading to the particular damage was foreseeable. It is sufficient if the general kind or type of injury is reasonably foreseeable: Chapman v Hearse (1961) 106 CLR 112 at 121; Rosenberg v Percival (2001) 205 CLR 434, per Gummow J at [64]; Metrolink Victoria Pty Ltd v Inglis (2008) 25 VR 633 per Neave JA at 636 [12][8].
[8] The situation under the Civil Liability Act is no different: Shoalhaven City Council v Pender [2013] NSWCA 210 at [62]; McKenna v Hunter & New England Local Health District [2013] NSWCA 476 at [115].
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].
It was alleged in the statement of claim that one or more hot products came into contact with combustible materials. Those combustible materials were identified as the wooden bin, one or more PVC buckets, a wooden pallet, wood offcuts, or the conveyor belt. The ultimate focus seemed to be on the conveyor belt, the roller, the bin and the buckets. However, there was no legal requirement, nor any factual necessity, to establish that any one of these things in particular provided the initial fuel source.
The precautions adverted to in AS 1674 relate to the protection of places where there is any possibility of starting a fire, and to materials which might give rise to a fire. The particulars of negligence and breach of agreement are, in part, directed to those general things. The expert evidence was that the ignition source was hot work particles but the likely initial fuel source was destroyed in the fire. The inability to precisely identify what it was is no impediment to the drawing of the inference and being affirmatively satisfied that, on the balance of probabilities, hot work caused the fire.
In terms of the competing possibilities as to whose hot work caused the fire, the following matters make it more likely than not, in my view, that it was that of Mr Maine. Mr Cooper used a grinder; Mr Maine used a welder. The particles produced from the welding process are generally larger and significantly hotter. The sparks from a grinder tend to be thrown directly in line with the rotating grinding disc. Subject to the placement of guards, welding spatter can go in any direction. The evidence, and what can be seen from the footage of Mr Bassett's tests, show that although seconds are involved, welding spatter retains its "red heat" for longer.
Mr Maine's welding was done at a more elevated level than Mr Cooper's cutting. Further, it may be of little weight, but although the evidence of the two men would tend to suggest that they were each working at roughly about the same distance from the wooden bin, an assessment of the photographic evidence – bearing in mind the difficulties associated with interpreting photographs – would tend to suggest that Mr Maine's work was closer to the area of origin.
A significant aspect to be considered is the time at which the work was performed. Mr Maine's work was done about three hours after that of Mr Cooper. Mr Maine's welding finished at about 7pm. Mr Maine and Mr Nalder were in and about the premises up until about 7.45pm. At about the same time, although apparently after Mr Maine and Mr Nalder had gone, Mr Langmaid came in and looked at the grading line to assess the progress of the work.
A combination of the expert evidence, the reference materials and common sense would strongly suggest that the longer the period of time between contact between a hot particle and a fuel source, the greater the likelihood of a fire or fire potentiality would be discovered. It is far more likely that a fire or the potentiality of one, would have been discovered in the 3¾ hours between Mr Cooper's hot work and when the last person left, than in the ¾ of an hour which went by after Mr Maine's work.
In my respectful view, the trial judge's concluding remarks reveal errors in the approach to whether or not the relevant inference could be drawn. No reference was made to the reasoning process explained in Betts v Whittingslowe. The accepted expert opinion as to cause seems to have been overlooked as part of the evidence from which the inference could be drawn. These matters are made more acute when put alongside the fact that her Honour seems to have accepted the real possibility that hot work caused the fire. I am satisfied that the trial judge erred in that her Honour ought to have been satisfied on the balance of probabilities that the respondent's hot work caused the fire, and that the established breach of duty was a necessary element of the occurrence of the damage.
In my view, the whole of the evidence justifies the drawing of the inference. Obviously, I do not consider that this is mere speculation, nor that it is a matter of choosing between guesses. On the evidence, I am affirmatively persuaded that the respondent's breach of duty was a necessary element of the occurrence of the damage.
Appellants' breach of statutory duty/contributory negligence
The parties were agreed that if the respondent was found liable to the appellants, this Court should deal with the question of contribution. The respondent pleaded breaches of statutory duty and contributory negligence on the part of Cherry Hill Coolstores by the omissions of Andrew Langmaid. The particulars of breach which were provided were the same for statutory duty and the general duty of care. They primarily alleged failures to comply with AS 1674 in its express terms or as to its substance.
As to Mr Langmaid, the respondent pleaded that it was an implied term of the agreement between Cherry Hill Coolstores and the respondent that he would be, for the purposes of AS 1674, the person who was responsible for the safe execution of all works and operations to be performed at the premises, and had the authority to enforce the requirements of AS 1674 with respect to any persons working in the premises. As part of the particulars of that allegation, it was asserted that AS 1674 required the appointment of a responsible person, and that Mr Langmaid was the person responsible for the direction and management of the business at the workplace, within the meaning of s10 of the Workplace Health and Safety Act 1995[9].
[9] 10 Responsible officer
The respondent separately pleaded as facts that Mr Langmaid "was the person in control of all operations at the premises within the meaning of AS 1674", and that he was the person responsible for direction and management of the business at the workplace within the meaning of s10 of the Workplace Health and Safety Act which included the direction and management of the respondent's employees. These allegations were denied in the appellants' reply.
The appellants alleged that the respondent agreed to carry out the work in accordance with the agreement, as an independent function, and that they relied on the respondent's expertise, knowledge and skill. Further, the appellants alleged that all obligations under AS 1674 were those of the respondent. The evidence about the issues was relatively sparse.
Mr Langmaid said that Mr Cooper and a casual employee, Mr McCormick, but primarily Mr Cooper, were assisting the respondent's employees. Mr Langmaid was asked about the "formal hierarchy", and said that the installation was being done by the respondent's employees with Mr Cooper's assistance. He agreed that supervision and necessary directions were provided to Mr Cooper and Mr McCormick by him, and that he checked on their work. He said that on the day of the fire he was on the Coolstores site generally, but only went to the grading line on two or three occasions.
Mr Cooper said that he received instructions from Mr Langmaid about the work which was to be done; what was to be done, and how it was to be carried out. He said that he did not think that all of the tasks, including those to be performed by the respondent's employees, were determined specifically by anyone to be done by anybody; "We just had a list of what had to be done and we just all made sure it got done".
He said that most days there were discussions about what had to be done, and the right way to go about things. Mr Langmaid was involved in this; " … he'd come over and check on us to make sure everything was going – how we needed it to go, and everything was fine". When Mr Langmaid came into the shed from time to time, he had an interest in the work that was being done and "a real interest" on the day of the fire about finishing things off so that commissioning could take place the next day.
Mr McCormack was another Coolstores employee. He agreed that during the work Mr Langmaid was "around … supervising", including supervising an electrician and the respondent's people. Mr Dutton was the electrician. He said that as he recalled it, Andrew Langmaid "was running the job and supervising the site". He explained that he meant the whole of the Cherry Hill Coolstores, not just the area of the grading line.
The agreement between Cherry Hill Coolstores and the respondent was not in writing. Through a number of conversations it was agreed that the respondent would supply a new potato sizer and conveyor belt for the particular grading area, and that it would install the equipment and perform additional upgrading works in conjunction with employees of Cherry Hill Coolstores. The work was to be done on a "do and charge" basis.
AS 1674 contains a definition of "responsible officer". The definition is:
"a person having a satisfactory knowledge of the fire, explosion and toxicity hazards associated with hot work in hazardous areas and who is adequately trained and experienced in the testing procedures and precautions necessary for the elimination of any risk involved."
Part 2, which contains the relevant clauses, contains a "supervision" clause. It reads as follows:
"2.1 SUPERVISION Hot work shall be carried out under the control of a person who is responsible for the safe execution of all operations and has authority to enforce the requirements of this Standard with respect to other employees, outside contractors and other people in the area. Before hot work is commenced in any location, this person shall ensure that –
(a) the hazards of the location are identified;
(b) a means of managing the hazards is in place;
(c) the equipment complies with the requirements of Section 4;
(d)the equipment is located so that, in the event of malfunction of the equipment, a fire or explosion hazard is not created; and
(e)there is no inherent hazard due to the nature of the item on which the hot work is to be performed.
NOTE: Where hot work is being carried out by a contractor, the person responsible for the hot work should be approved by both the principal and the contractor."
It can be seen that the term "responsible officer" is not used in this section, although it is in Part 3 – "Hazardous Areas". Clause 3.2 – "Responsible Officer" is in the following terms:
"A responsible officer shall be appointed to be responsible for the safe execution of any hot work, and shall have authority to enforce the requirements of the standard with respect to employees, contractors and other workers.
NOTE:Where hot work is being carried out by a contractor, the responsible officer who is appointed should be approved by the principal and the contractor."
Accordingly, although "the person responsible for the hot work" is used in Part 2, but "the responsible officer" is used in Part 3, the meaning of the two terms is, for practical purposes, identical. That returns the focus to the definition of "responsible officer". There is no evidence that Mr Andrew Langmaid had any relevant knowledge, training or experience as referred to in the definition. There is no evidence that he was aware of AS 1674. On the other hand, the respondent's Mr Dobson did, but did not tell Mr Maine about its requirements. There is no evidence of any discussions between the parties as to who was to assume responsibility under AS 1674.
The requirement for the implication of the term in the agreement that Andrew Langmaid was to be the responsible person within the meaning of Part 2 of AS 1674 is not made out; the term is not necessary for the reasonable or effective operation of the contract: Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 442; Hawkins v Clayton (1988) 164 CLR 535 at 573. The evidence does not establish that Mr Langmaid was the person responsible for the hot work as referred to in AS 1674. It might well be the case that Mr Langmaid was taken to have been appointed as the responsible officer under the Workplace Health and Safety Act, but no direct and relevant consequences of this are pleaded, nor any made out on the evidence.
The evidence does not establish any relevant obligation on the part of Mr Langmaid. Cherry Hill Coolstores engaged the respondent to do the work, and the clear inference is that they relied on the respondent's skill in that area. The obligation to supervise and comply with AS 1674 was that of the respondent alone.
In addition to allegations of a failure to comply specifically with AS 1674, in its particulars the respondent alleged a failure to take the sort of measures identified in the Standard, including a failure to adequately supervise the respondent's employees, and to discuss with them the work they were to carry out and whether any steps should be taken to minimise the risk of fire. There is also an alleged failure to remove from the immediate vicinity of hot works that were being performed at the premises the materials said to be combustible materials identified by the appellants in their pleadings.
Putting to one side for the moment the failure to remove combustible materials from the immediate vicinity, in the absence of any duty to supervise, oversee and direct the respondent and its employees in the carrying out of hot work done by them, no question of breach arises. As to the removal of combustible materials, the wooden bin is the focus of the argument.
There is no doubt that a Cherry Hill Coolstores employee, Mr Cooper, put it there. It was there for at least three hours before Mr Maine welded the guard to the upper conveyor. Its presence was obvious. It obviously fell within the description of items which needed to be protected or wetted down. Otherwise, I am not satisfied that the appellants had any duty to clear the area. That is covered by cls 2.4, 2.7 and 2.8 of the Standard with which the respondent had to comply.
I am not satisfied that the respondent has discharged its onus of establishing, on the balance of probabilities, any breach of duty on the part of the appellants.
Outcome
I would allow the appeal and set aside the judgment dated 31 May 2013. Judgment should be entered for the appellants against the respondent for damages to be assessed and the action should remitted to the trial judge for the assessment.
File No FCA 571/2013
ANDREW KEVIN LANGMAID & KEVIN GEORGE LANGMAID t/as CHERRY HILL COOLSTORES, LATROBE COOL STORES PTY LTD v DOBSONS VEGETABLE MACHINERY PTY LTD
REASONS FOR JUDGMENT FULL COURT
PEARCE J
4 July 2014
I have had the advantage of reading the draft reasons of Blow CJ and Porter J. Their Honours have set out fully the issues in this appeal and the relevant evidence in the trial. I agree with Porter J that, for the reasons given by his Honour, the appeal should be allowed and concur with the orders his Honour proposes.
I agree that, for the reasons given by Blow CJ and Porter J, the respondent breached its statutory duty, its duty to take reasonable care, and implied terms of contract by failing to take the precautions required by AS 1674. I am persuaded, on the balance of probabilities, that the hot work performed by Mr Maine, the respondent's employee, caused the fire, and the respondent's breach of duty was a necessary element in the occurrence of the fire; Civil Liability Act, s13(1)(a). On the evidence it was, as the learned trial judge concluded, safe to exclude arson and various items of equipment (including the switchboard, an electrical welder, the computer equipment and some battery chargers) as causes. The work performed by Mr Nalder was, by its nature and location, not seriously considered to be a potential cause. The possibility that the fire resulted from some other cause unrelated to anyone's hot work cannot be excluded. However the only evidence of another potential cause was an unidentified burnt object in the extreme north east corner of the building. The learned trial judge said, at [134], that she was unable to include or exclude that object as a potential cause, although how it may have caused the fire was not really explored.
It is obvious that fire was an outcome of the kind that may arise from the respondent's breach of duty: Betts v Whittingslowe (1945) 71 CLR 637 at 649. In the circumstances of this case, viewed prospectively, the chance of a fire occurring as a result of hot work was small. However a fire occurred. The prospective assessment of risk is not the same as an after the event assessment of causation. Expert evidence and written reference materials tendered at the trial recognised the possibility of combustion after some hours caused by undetected smouldering from material emitted from hot work. The evidence of the area of origin of the fire coincided with the location of hot work. Both Mr Muench, the Tasmania Fire Service examiner, and the appellant's expert, Mr Thomas, gave evidence of their opinion that the product of hot work, welding slag or grinding sparks, was the most probable cause. As French J pointed out in Amaca Pty Ltd v Booth (2011) 246 CLR 36 at 53 [43]:
"An after-the-event inference of causal connection may be reached on the civil standard of proof, namely, balance of probabilities, notwithstanding that the statistical correlation between the first event and the second event indicated, prospectively, no more than a 'mere possibility' or 'real chance' that the second event would occur given the first event. There may of course be cases in which the strength of the association, as measured by relative risk ratios, itself supports an inference of a causal connection."
For the reasons given by Porter J, I would infer that hot work was the cause of the fire and regard it as far more likely that the hot work of Mr Maine, rather than the hot work of the appellant's employee Mr Cooper, caused the fire. Consideration of the whole of the evidence in this case leads me to conclude that, on the balance of probabilities, an "inference of causal connection" between Mr Maine's hot work and the respondent's breach of duty and the occurrence of the fire should be drawn.
I also agree with Porter J that a breach of duty by the appellants has not been proved.
A person conducting a business or undertaking at a workplace must ensure, so far as is reasonably practicable, the following:
(a)…
(1) An employer is to appoint a responsible officer for each workplace at which the employer carries on business.
(2) If an employer fails to appoint a responsible officer for a workplace, the person responsible for the direction and management of the business of the employer at that workplace is taken to have been appointed as the responsible officer for that workplace.
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