Laws v GWS Machinery Pty Ltd - [2007] NSWSC 316

No judgment structure available for this case.

Reported Decision:
209 FLR 53

New South Wales

Supreme Court

CITATION: Laws v GWS Machinery Pty Ltd & 2 Ors; Laws v GWS Machinery Pty Ltd & Anor [2007] NSWSC 316

HEARING DATE(S): 01/05/2006-05/05/2006; 08/05/2006-12/05/2006; 15/05/2006-19/05/2006; 22/05/2006-25/05/2006; 27/06/2006

JUDGMENT DATE :
4 June 2007

JURISDICTION: Supreme Court

JUDGMENT OF: Rothman J

DECISION:
The Court proposes the following orders:
A. In 20084/2002, Thomas John Laws (Laws Senior):
(i) Judgment for the plaintiff against the first and second defendants in the amount of $272,433.79; (ii) Each of the first and second defendants contribute 50% of the judgment sum; (iii) The first and second defendants pay the costs of the plaintiff of and incidental to these proceedings, as agreed or assessed; and (iv) Pursuant to Rule 36.4(3) of the Uniform Civil Procedure Rules 2005 (NSW), this judgment comes into effect on and from 1 June 2007 and interest pursuant to s.101 of the Civil Procedure Act 2005 (NSW) accrues from that date.
B. In 20076/2002, John Rodney Laws (Laws Junior):
(i) Judgment for the plaintiff against the first and second defendants in the amount of $9,146,462.05; (ii) Each of the first and second defendants shall contribute 50% of the judgment sum; (iii) The first and second defendants shall pay the costs of the plaintiff of and incidental to these proceedings, as agreed or assessed; (iv) Otherwise, the proceedings, including the cross-claim be dismissed; and (v) Pursuant to Rule 36.4(3) of the Uniform Civil Procedure Rules 2005 (NSW), this judgment comes into effect on 1 June 2007 and interest pursuant to section 101 of the Civil Procedure Act 2005 (NSW) accrues from that date.
The Court makes the following orders:
(i) Both matters stand over until 9.30am on 14 June 2007; (ii) Leave is given for each plaintiff to inform the Court of the election as to damages in negligence and for that purpose to notify the Associate to Justice Rothman and each other party of the election by close of business 12 June 2007; (iii) Leave is granted to all parties to notify and serve any alleged miscalculation in the reasons for judgment by that date and for any special or different basis for the order for costs; and (iv) The parties are directed to confer and the plaintiffs shall file a formal minute of the orders arising from these reasons for judgment.

CATCHWORDS:
NEGLIGENCE – DUTY OF CARE – vendor and purchaser – actual knowledge of dangers – reason to know – vendor liable – importer/wholesaler liable – warning required – reasonable response – causation.

TRADE PRACTICES ACT – meaning of consumer – used up in process of repair – tractor tyre not ordinarily acquired for domestic purpose – consumer except for purposes of Part V Division 2A.
DAMAGES – election between damage under negligence and Trade Practices Act – future care principles – 24-hour care required.

LEGISLATION CITED: Civil Procedure Act 2005 (NSW)
Sale of Goods Act 1923 (NSW)
Trade Practices Act 1974 (Cth)
Uniform Civil Procedure Rules 2005 (NSW)

CASES CITED: ACCC v Glendale (1998) ATPR 41-632
Arnison v Smith (1889) 41 Ch D 348
Arthur Robinson (Grafton) Pty Ltd v Carter (1968) 122 CLR 649
Atkinson v Hastings Deering (Qld) (1985) 6 FCR 331
Australian Timber Workers Union v Monaro Sawmills (1980) 42 FLR 369
Berrigan Shire Council v Ballerini [2005] VSCA 159
Chulcough v Holly (1968) 41 ALJR 336
Crago v Multiquip (1998) ATPR 41-620
Dessent v Commonwealth (1977) 51 ALJR 482
Donoghue v Stevenson [1932] AC 562
Fabre v Arenales (1992) 27 NSWLR 437
Graham Barclay Oysters Pty Ltd v Ryan; Ryan v Great Lakes Council; State of New South Wales v Ryan (2002) 211 CLR 540
Grant v Australian Knitting Mills (1935) 54 CLR 49
Imperial Furniture Pty Ltd v Automatic Fire Sprinklers Pty Ltd [1967] 1 NSWR 29
Jillawarra Grazing v John Shearer (1984) ATPR 40-441
Jones v Dunkel (1959) 101 CLR 298
Lanza v Codemo [2001] NSWSC 72
Laundess v Laundess (1994) 20 MVR 156
McPherson’s Ltd v Eaton [2005] NSWCA 435
Minchillo v Ford [1995] 2 VR 594
Modbury Triangle v Anzil (2000) 205 CLR 254
Olley v Marlborough Court Ltd [1949] 1 KB 532
Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451
Pesl v Ray Smith Tractors [2007] NSWCA 74
Podrebersek v AI&S (1985) 59 ALJR 492
Purkess v Crittenden (1965) 114 CLR 164
SCC v Dell Oro (1974) 132 CLR 97
Sharman v Evans (1977) 138 CLR 563
Stevens v Brodribb Sawmilling (1986) 160 CLR 16
Stevenson Jordan & Harrison v McDonald [1952] 1 TLR 101
Sullivan v Moody (2001) 207 CLR 562
Texcrete Pty Limited v Khavin [2003] NSWCA 337
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165
Van Gervan v Fenton (1992) 175 CLR 327
Wyong Shire Council v Shirt (1980) 146 CLR 40

PARTIES:
20076/2002 -
P: LAWS, John Rodney
D1: GWS Machinery Pty Ltd
D2: Motokov Australia Pty Limited (in liquidation) / CGU Insurance Australia Limited
D3: LAWS, Thomas John
XC: LAWS, Thomas John
XD: NRMA Insurance
20084/2002 -
P: LAWS, Thomas John
D1: GWS Machinery Pty Ltd
D2: Motokov Australia Pty Limited (in liquidation) / CGU Insurance Australia Limited

FILE NUMBER(S): SC 20076/2002; 20084/2002

COUNSEL:
20076/2002 -
P: Mr D.A. Wheelahan QC with Mr P.J. Frame
D1: Mr S.G. Campbell SC with Mr P.L. Perry
D2: Mr R.A. Gray
D3: Mr P.J. Doherty SC with Mr Morgan
20084/2002 -
P: Mr P.J. Doherty SC with Mr Morgan
D1: Mr S.G. Campbell SC with Mr P.L. Perry
D2: Mr R.A. Gray

SOLICITORS:
20076/2002 -
P: Mr S. Groves (Lamrocks Solicitors)
D1: Mr P. Lederman (Moray & Agnew Solicitors)
D2: Mr S. Kennedy (Curwoods Lawyers)
D3: Mr P. Heath (Somerville & Co)
20084/2002 -
P: Mr P. Heath (Somerville & Co)
D1: Mr P. Lederman (Moray & Agnew Solicitors)
D2: Mr S. Kennedy (Curwoods Lawyers)

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

ROTHMAN J

4 June 2007

20076/2002 John Rodney LAWS by his tutor Catherine Anne LAWS v GWS MACHINERY PTY LIMITED & ORS

20084/2002 Thomas LAWS v GWS MACHINERY PTY LIMITED & ORS
JUDGMENT

1 HIS HONOUR: On 10 March 1999 Thomas John Laws was fitting a tyre to the tyre rim of a Massey Ferguson 35 Tractor when the tyre and tube exploded forcing the rim outwards and causing injury to Thomas Laws (hereinafter referred to as Laws Senior) and his son John Rodney Laws (hereinafter referred to as Laws Junior). The son, Laws Junior, sustained substantial and serious injuries and consequent continuing disabilities. The father, Laws Senior, also suffered injury.

2 Each of the son, Laws Junior, and his father, Laws Senior, sue the retailer of the tyre, GWS Machinery Pty Limited (“GWS”) and the importer and distributor (and for some present purposes the manufacturer) of the tyre, Motokov Australia Limited (“Motokov”).

3 CGU Insurance Australia Limited have been substituted as the defendant for Motokov because of Motokov’s liquidation and subsequent de-registration.

4 Laws Senior claims for the personal injuries caused by the explosion against GWS in negligence, in that it has breached its common law duty of care, and in contract, for breaches of conditions implied into the contract by the general law, by sub-sections 19(1) and 19(2) of the Sale of Goods Act 1923 (NSW), and by sub-sections 71(1) and 71(2) of the Trade Practices Act 1974 (Cth). Laws Senior also claims damages against Motokov, also in negligence for breach of its common law duty of care, and for breaches of sections 74B, 74D and 75AD of the Trade Practices Act 1974 (Cth).

5 Laws Junior sues GWS in negligence for breach of its duty of care; this, it is said, being determined on the issue of foreseeability of damage arising from such breach. Laws Junior sues Motokov again in negligence for breach of its duty of care at common law and also for breach of section 75AD of the Trade Practices Act 1974 (Cth).

6 I need to detail the facts that gave rise to the sale and supply by GWS and Motokov respectively and the conduct, which gave rise to the explosion and consequent injuries. Having done so, it will be necessary to deal with the issues of liability in respect to each plaintiff and, to the extent that liability is found to exist, the nature of the injuries suffered by each plaintiff and the damages that arise therefrom.

7 Initially, Laws Junior also sued Laws Senior who, in turn, cross-claimed against GWS and Motokov. This aspect, both the suit by Laws Junior and these cross-claims were resolved during the proceedings. However, GWS and Motokov each claim, by way of cross-claim, against the other in the remaining proceedings by both Laws Junior and Laws Senior. Further, in the proceedings by Laws Junior, each of GWS and Motokov claim contribution by Laws Senior and, in the Laws Senior action, claim reduction on account of contributory negligence.

Facts Relevant to Liability

8 Laws Senior was born on 28 August 1943 and was 55 years of age at the time of the accident. He lived with his wife Kerry in Bowen Mountain in the Central Coast of New South Wales. He was involved in building and renovating houses and doing general farming work for the people in and around the region including slashing and excavation work. In performing that work he operated a partnership with his wife, the division of labour being that Mr Laws Senior performed all of the work from which income was derived and his wife performed the clerical and accounting tasks.

9 On 10 March 1999, the date of the accident, Laws Senior was performing work at a neighbour’s residence. The work was slashing work for which purpose he used a Massey Ferguson 35 Tractor owned by Laws Senior and, probably, his wife. The tractor had been purchased second-hand in 1996 and, while relatively old, had been used consistently and continuously by Laws Senior since that time.

10 This was, for those unfamiliar with a Massey Ferguson 35, a typical small tractor. It had large rear tyres, which were the drive wheels, and smaller front tyres. On the morning of 10 March 1999, the left-hand rear tyre of the tractor punctured. At the time Laws Senior was working in a paddock that was uneven and, despite the puncture, managed to get the tractor onto more level ground. It was clear that the tyre was unable to be repaired. He rang his wife at home and read to her the size of tyre that was needed. He read that size from the deflated tyre and asked her to ring around local tyre outlets to obtain a new one.

11 Mrs Laws rang two outlets one of them, Brooks Tyres, was a tyre specialist and the other was GWS. Brooks Tyres had no appropriate stock.

12 There was some minor issue in the proceedings as to the size of tyre for which Mrs Laws had asked. Neither of the witnesses could recollect precisely the size of the tyre, not surprisingly after this many years. Laws Senior had read the size of the tyre off the deflated tyre itself and we can assume that the size of the tyre was given relatively accurately.

13 Mrs Laws could not recall precisely the size of tyre that was told to her but had made a record (Exhibit L) which record discloses the numbers and symbols 10.11.2-28. Reading the note Mrs Laws described it as “ten eleven point two dash twenty-eight.”

14 When Mrs Laws telephoned GWS it is most probable that she spoke to a person named Rod Kitching, who is now deceased. Mr Kitching was the second in charge of GWS spare parts sales and had held that position for approximately 10 years and had been working with tractor spare parts for approximately 45 years.

15 It is not absolutely clear the size of tyre that was given to Mr Kitching by Mrs Laws, but, relevant to these proceedings, it does not matter. If it were, as is possible, the size 10.11.2-28, there is no such tyre size. It is clear that whatever Mrs Laws gave to him, and I do not at this point discount that Mrs Laws asked for an 11.2 – 28 (the actual size of the deflated tyre), Mr Kitching understood, as is obvious from his subsequent conduct, that the size requested was 11.2 – 28.

16 To the extent that I may be incorrect in my assessment that the size requested was irrelevant, I should elaborate on why it is I think it is more than possible that what was requested was an 11.2 – 28. While the record (Exhibit L) discloses 10.11.2-28, the last three numbers (i.e. all but the number 10) is the actual size of the tyre. Exhibit L may have been written in circumstances where it was initially thought that her husband said “10” (or, he, in fact said “10”) and it was clarified over the telephone resulting in both numbers being recorded in the note. At the time that it was read to Mr Kitching she had recalled what it was her husband had said. Given that Laws Senior was reading the tyre size from the deflated tyre, it is most likely that the note discloses that kind of confusion and that in requesting the tyre Mrs Laws used the correct numbers.

17 Whatever be the case, I take the view that it is irrelevant, because it is clear that Mr Kitching did take it as a request for an 11.2 – 28. Mr Kitching’s reply was that GWS did not have a tyre size of that kind and that the size was no longer made. He told Mrs Laws words to the effect that the tyre size that had replaced the 11.2 – 28 was a 12.4 – 28 tyre, which would do the same job. She was told the price of the tyre and an inner tube, a conversation ensued in which it was made clear that her husband would come and pick-up the tyre and tube and the conversation concluded.

18 After this telephone call Mrs Laws contacted her husband, prepared a cheque for the amount involved, namely, $530.00, picked-up Laws Senior and took him home.

19 Laws Senior collected some tools, returned to his neighbour’s property and removed the wheel. He did this by deflating the tyre totally of air and water and taking the entire wheel from the tractor.

20 After removing the wheel and taking it home, he went to the premises of GWS at Windsor. He was familiar with GWS.

21 He informed the assistant at GWS that he had “come to pick-up the tyre which his wife had rung about”. He collected the tyre and tube and handed over the cheque that had been prepared by his wife. The tyre was a Barum brand tractor tyre called a 12.4 – 28 TZ19 6 Ply. This discloses the type of tread and ply of the tyre as well as the size being 12.4 – 28. I will return later to the size of the tyre and the other relevant matters associated with its description.

22 As already stated the conversation between Laws Senior and Mr Kitching, who I accept was the assistant described as “the short guy behind the counter”, was perfunctory. Laws Senior also spoke to the elder Mr Greentree (the then principal and managing director of GWS) relating to a previous order for a new tractor. The “invoice/receipt” was then signed and was retained by GWS and a copy was given to Laws Senior.

23 Laws Senior placed the tyre and tube in his vehicle and returned home.

Transaction: Terms of Contract

24 As can be seen from the above, Mrs Laws ordered the tyre; Laws Senior took possession of the tyre and paid for it with the previously prepared cheque. After all of that had occurred, Laws Senior signed, and received an unsigned copy of, an invoice/receipt. GWS rely upon the terms on the reverse side of that document as terms and conditions forming part of the contract of sale. Mr Laws Senior described the document as a receipt.

25 GWS submits that the signing of the document has significance. But on the facts as I have found them, the signing of the document occurred not only after the parties entered into the contract, but after it had been completed.

26 The document was signed over the expression “RECEIVED THE ABOVE-MENTIONED GOODS AS ORDERED”. In those circumstances the back of the document, which was not drawn to the attention of Laws Senior, does not form part of the contractual documents and cannot be relied upon by GWS. To the extent that authority is required for that proposition, see Olley v Marlborough Court Ltd [1949] 1 KB 532.

27 GWS relies on the judgments of the High Court in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 and Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451. Neither is of assistance to GWS. There is no evidence to suggest that Laws Senior understood the “invoice” contained contractual terms. On the view I take of the facts, the contract had been concluded (and performed) before anything was signed and, at that time, it could not have been intended to affect legal relations. Further, on its face, the signature acknowledges only receipt of the goods, and the signed face of the document does not draw attention to any terms on the reverse side.

28 While the placing of a signature on a document may lead to the reasonable conclusion that the document has significance, to do so after the completion of the contract and in circumstances where one is expressly signing as acknowledgement of past receipt of goods for which payment has already been made does not elevate the document to one which “objectively” defines the rights and liabilities of the parties or by which the parties are bound whether or not they are aware of its terms. Further, notwithstanding the past limited dealings between Laws Senior and GWS, there is no evidence of awareness from those dealings of these terms or that they were known to be “usual” or “customary” (or ought to be known).

29 Notwithstanding the above finding, I will deal with the terms relied upon by GWS. As noted above, on the back of the tax invoice are numbered paragraphs described as “Terms and Conditions of Sale”. They are introduced by the following preamble:

“Unless otherwise stated in our Quotation or agreed to in writing, it must be clearly understood that acceptance of your Order is subject to acceptance of the standard conditions printed below.”

30 The above preamble confirms, in my view, my initial approach. The order had been accepted prior to the document coming into the possession of Laws Senior. Nevertheless, Clause 10 is in the following terms:

Limitation of Liability

31 As can be seen from the above, the purported limitation has two sentences. The last sentence deals with a limitation on damage for non-delivery in circumstances where delivery has been effected to an authorised third-party carrier. In the first sentence of the Clause, GWS deal with consequential loss and loss of profits. The Clause does not expressly seek to deal with a limitation on negligence and may not even deal with damage caused by the goods supplied. If the Clause, i.e. both sentences, is purporting to deal with the same subject matter, the Clause is dealing with consequential loss from non-delivery, or delay in delivery, and the loss of profits occasioned thereby. This seems to be the preferable construction. If it is not the proper construction, then the Clause is dysfunctional and illogical. In any event, if each sentence is to be taken separately, then the first sentence does not expressly deal with loss arising from a defect in the goods and/or from negligence and I do not construe it as so applying.

The Fitting of the Tyre

32 After Laws Senior returned home with the new tyre (a Barum 12.4-28 TZ19 6 ply) he commenced the process of fitting the new tyre and tube to the rim. While initially the fitting of the tyre was a matter of some controversy, it was ultimately not in dispute (or not significantly) and could or should have been the subject of agreement. Nor, ultimately, was there much controversy concerning the appropriateness of the method chosen by Laws Senior to fit it.

33 Laws Senior removed the old deflated tyre and tube from the rim and cleaned the rim. This he did with a wire brush, removing residual rust and grime. The rim was a 9-inch rim, which, it seems, was one of the rims that were standard on Massey Ferguson 35 tractors of that era. It is the overwhelming evidence in these proceedings that the rim was in good condition and that Laws Senior had done a good job of cleaning it and had not damaged it.

34 The rim was placed on its side with the valve side facing up. Laws Senior applied soapy detergent to the flanges and on the side of the tyre. He then placed the lower bead of the new tyre over the upper rim flange. This was described as an easy process and the tyre “fell over” the upper rim flange.

35 As one would imagine, once fitted, and certainly once inflated, a large agricultural tyre and rim is a heavy article. It was necessary, because of the weight of the article, to place the rim and tyre inside the back of his vehicle before inflating it. The vehicle was described in graphic details, and there are photos, but it suffices for my purposes to describe it in the slang term used during some of the evidence, namely as a “troop carrier”. It was a four-wheel-drive with a passenger cabin at the front of the vehicle and the back of the vehicle was enclosed with bench seats along the sides of the vehicle running from front to back.

36 Having placed the inside bead over the top of the rim (the top being, as it was lying on the ground, the outside rim once the tyre and wheel were fitted), Laws Senior placed the inner tube that he had purchased inside the new tyre and fitted the valve through its outlet on the wheel rim. There was then some difficulty in fitting the upper or outer bead over the outer wheel rim. It was necessary for both Laws Senior and Laws Junior to stand on the tyre and also to use tyre levers and a rubber mallet. The evidence discloses that none of the above action was inappropriate and no damage was occasioned to the tyre. I find, to the extent necessary, that the method of placing the inner tube into the tyre casing prior to manipulating the outer bead into the confines of the wheel rim was reasonable and appropriate and did not damage the tyre or the inner tube.

37 Laws Senior and Laws Junior then placed a plank leading into the rear compartment of the troop carrier and rolled the assembled wheel up the plank into the rear compartment of the vehicle.

38 The evidence in these proceedings discloses that it is common, perhaps almost universal, for the drive wheels of tractors to be inflated with a combination of water and air. The water adds weight to the tyre giving it greater stability and better traction.

39 Laws Senior then removed the valve and placed a hose over the valve housing. The hose fitted fairly snugly and water was then used to fill the tube within the tyre. As the water filled the inner tube, the tyre started to seat. In this context, the seating of the tyre was the process where the tyre expands and the beads of the tyre sit against the wall of the wheel rim without a gap.

40 At this stage, the tyre was placed more or less upright in the back of the vehicle with the valve housing at the furthest distance possible from the ground. In evidence, using the positions on an analogue clock, this position was described as 12 o’clock. As a consequence of this process air pressure would necessarily build up in the tyre tube and Laws Senior periodically stopped the flow of water through the hose, removed it from the valve housing, and allowed the air to escape.

41 When the tube had been more or less filled with water, the tyre was rolled so that the valve was at the 11 o’clock position. This caused water to be released at which point the tyre was rolled back to the 12 o’clock position. The valve was then refitted to the housing and Laws Senior pumped air into the tyre at or below 15 psi. The air pressure was intermittently checked with a pressure gauge and the evidence, which I accept, is that no stage did the air pressure, as measured accurately at the valve, exceed 15 psi.

42 Laws Senior gave evidence that he could, during this process, see both beads and that he was satisfied that the tyre was normally seated on the rim. I will briefly return to this at a later point in this judgment.

43 Laws Senior removed the air hose from the valve. He and Laws Junior moved the tyre slightly to allow stops to be placed to prevent it from moving during its return to the tractor. The tyre and inner tube suddenly ruptured, exploding with such force that the rim was propelled outwards, with force, striking both Laws Senior and Laws Junior.

44 Laws Junior, who was born on 3 August 1966 and was 32 at the time of the accident, was at the rear of the vehicle at the time of the explosion and was struck in the head and flung out of the vehicle onto the concrete. Laws Senior who was at the side of the tyre was also flung away sustaining less severe injuries, predominantly to his right arm.

45 While there was initially some controversy concerning the method of fitting the tyre utilised by Laws Senior, such controversy dissipated. While there remained some minor aspects of dispute, GWS utilised the services of an expert, Mr Keith Edward Hook, who described the proper method of tyre fitment. There were two differences between the method of fitting adopted by Mr Hook and that described by Mr Laws Senior. Those differences related to the time at which the inner tube was fitted and the ease with which the upper or outer bead fitted over the upper or outer rim. When the tyre was being fitted by Laws Senior (together with Laws Junior), it was “so stiff that the body weight of both plaintiffs together was barely sufficient to push the outer face of the tyre down into the bead well. It certainly did not go over the rim through the use of a hammer [only], a tyre lever and hammer was required.” (Supplementary Report of Mr Colin Simpson, which I accept as a proper summary of the evidence that I accept in this regard)

46 Essentially, the method of fitting adopted by Laws Senior was the same as, or so similar as to have no significant difference from, the method adopted by Mr Hook. I will return to the “stiffness” of the tyre when Mr Laws Senior was fitting it. With the exception of safety precautions, the method of fitting the tyre, described by Laws Senior, disclosed no want of care by him and discloses no obvious negligence. I bear in mind that Laws Senior was not a trained tyre fitter and had little or no experience in fitting tractor tyres. He had helped change a rear tyre of a tractor once when he was very young. He had changed some car tyres and possibly some truck tyres over the years, but not many. He had never been trained in tyre fitting. He had no knowledge or understanding that the tyre could fail and explode during fitting and had no knowledge that serious injury could ensue. His only understanding of the consequences of an improperly seated tyre was the effect it would have on the capacity to drive (e.g. wheel wobble).

47 Further, Mr Laws Senior had no knowledge of any other safety precaution necessary or desirable including the use of a remote filler (i.e. a filler at the end of a longer arm to enable the worker to be away from the tyre), or the use of a cage, or the restraining of the tyre by bolting it either to the tractor or to some other fixed point. Further, he was unaware that the tyre ought not to be changed by anyone other than an experienced and trained tyre fitter. Were he aware of one or more of these factors, or if he should have been, his actions in fitting the tyre himself may have been negligent. However, I find that he was not aware of any one of these factors; nor, reasonably, should he have been; and he was not negligent. There was no negligence or want of due care by Mr Laws Senior such that he is liable to contribute to the damage suffered, if actionable, by Mr Laws Junior or liable to have his own damages reduced on account of contributory negligence.

The Size and Specifications of the Tyre

48 I have described above the size of the tyre originally fitted to the tractor and the size of the tyre provided by GWS. There is no doubt that Barum no longer manufactured an 11.2-28-size tyre. While, if I were required to conjecture, I would guess that no manufacturer produced a tyre of that size, there is no evidence to that effect or that goes so far.

49 It is necessary to explain the rim size of 9 inches, for a W (or Wide) rim. It is the distance between each of the outer flanges, or, otherwise expressed, the distance between each of the opposite rim edges, across of the thickness of the wheel. Another measurement is the rim diameter, but for present purposes it is unnecessary to deal with that.

50 The difference in tyre size between an 11.2-28 tyre and a 12.4-28 tyre is the width of the tyre between the beads, or inner edge. In this case, the difference is 1.2 inches. The “28” refers to the diameter of the tyre and it is, for current purposes, irrelevant.

51 Barum is a Czech manufacturer that had a controlling interest in Motokov. It manufactured for the European market and also for overseas, including Australia. There is no evidence that the tyres marketed in Australia were identical to the tyres marketed in Europe.

52 As earlier stated the wheel on this tractor was a 9-inch W rim. European standards published in 1998 and 1999 suggested that a 12.4-28 tyre manufactured by Barum could fit a 9 inch W rim. Australian standards suggested otherwise. Australian standards published in 1998 and 1999 (and continuing through to 2006) approved W10, W10H and W11 as rim sizes for a 12.4-28 tyre, but did not approve a W9 rim (the size fitted to this tractor).

53 Further, Barum itself produced recommended rim sizes for its tyres. In 1998, the approved rim sizes for a 12.4-28 tyre did not include a W9 rim. In 1999 Barum published its catalogue and for the first time for it in Australia approved a W9 rim as appropriate for a 12.4-28 tyre. Uninformed by evidence, one might assume that if a W9 rim was approved in 1999 it was equally appropriate, for that size tyre, in 1998. However the evidence disabuses one of that assumption. Mr Simpson, an expert whose evidence I accept in this regard, said:

54 Thus, whatever the assumption that might ordinarily be made, the documentary evidence before the Court establishes that for the rim size owned by Laws Senior, as at 1998, Barum did not approve a 12.4-28 tyre. Nor did The Tyre and Rim Association of Australia. There is no evidence that, for Barum tyres sold in Australia in 1998, there was approval for a 12.4-28 size to fit a W9 rim. Indeed, the evidence is to the contrary. The evidence establishes that in 1998 a Barum 12.4 – 28 tyre was not recommended for W9 rim.

55 As earlier stated, Mr Laws Senior purchased the tyre on 10 March 1999. However, the tyre was supplied to GWS by Motokov in November 1998 and obviously received by Motokov prior thereto and manufactured even earlier. Motokov, in its first submissions, relied upon the change in approval, and its notification of GWS, to apportion to GWS any damage arising from the fitting of an inappropriate tyre.

56 This discrepancy, evidenced inter alia by the changing recommendations of Motokov, in my view, accounts for the difference in the ease with which the upper or outer bead or edge of the tyre would fit over the flange or outer edge of the rim when performed by Mr Laws Senior and by Mr Hook. The stiffness, as earlier described, may be the result of the different manufacturing specifications. It further accounts for the reason that in 2003, when seeking to duplicate the apparent problem, it could not be done. By 2003 a 12.4-28 tyre was manufactured to specifications, which allowed its approval on a W9 rim. This finding is confirmed by comparison of the three tyres (Exhibit R), which, admittedly to the untrained eye, shows the stark difference between an 11.2-28 and a 12.4-28, but also shows a noticeable difference between a 12.4-28 tyre manufactured in 2003 compared to the tyre that exploded. That difference between the two tyres, each 12.4-28, is not a difference that would be displayed in the measurement between the inner and outer bead edge.

57 Therefore, at least in relation to Barum tyres, when GWS advised Mrs Laws, and subsequently Mr Laws Senior, that the 12.4-28 tyre was an appropriate or approved one, the advice was based upon incorrect information. This does not mean that, in this regard, GWS were negligent. Nor does it mean that damage was occasioned by reliance upon the advice.

58 An issue arose in the course of these proceedings, as to the information that Motokov had supplied GWS. There was an understandable incapacity, amongst staff at GWS, to recall every brochure supplied by Motokov. I find, on the balance of probabilities, that Motokov supplied GWS with a catalogue for agricultural tyres each year or, at least, with each change in information and/or specifications. The brochure, which is in evidence, supplied in relation to 1998, as earlier stated, did not have the 12.4-28 tyre as an approved tyre for a W9 rim. However, the brochure for 1999, which I find was available at or immediately after the beginning of 1999, did approve that size tyre for that size and type of rim. I find that Motokov expected, and it was reasonable to expect, that a dealer, on receiving a new brochure, would discard the old brochure and use only the new one. This was the evidence of GWS that I accept. Motokov must have known, when it supplied the new brochure, that dealers would use it to determine the appropriateness of supplying a tyre manufactured at a time and to specifications inconsistent with the specifications of the tyres to which the advice in the brochure related.

The Physical Cause of Tyre Failure

59 As one may infer from the foregoing, the manufacture of a tyre and its composition can vary significantly. Even tyres of the same size (as formally measured) may differ significantly, not only in the obvious aspects such as tyre tread. Differences, which are latent, may be more significant than the variations, which are obvious to the eye. Variations may be to the thickness and therefore stiffness of the rubber composition and, relevantly for the issues with which the Court is here concerned, there may be differences in the composition of the bead.

60 The bead of the tyre is that part of the tyre immediately adjacent to the hole in which the rim of the wheel fits. In both a tubeless and tubed tyre, the bead should be the strongest part of the tyre. The proper seating of the tyre (being the placement under pressure of the bead of the tyre against the flange of the rim of the wheel) provides a constant support to withstand the pressure associated with inflation of the tyre. The bead in the Barum 12.4-28 TZ 19 6 ply was a “weftless bead”. Other kinds of bead exist. Two of them are a single bead wrap and a cable bead wrap.

61 Mr Ochs gave evidence concerning the differences in these beads. Mr Ochs was a most impressive witness. He is a professional engineer who was employed for many years by Michelin. His functions at Michelin included evaluating failures in tyres and the design of Michelin tyres first sold to equipment manufacturers. He is an expert in the very areas that concern these proceedings and particularly in tyre failure analysis. He has particular experience in all types of tyres including in relation to bead failure in truck, farm and earthmoving tyres. He was called by Mr Laws Junior and was interposed because of his need to return to New York. During the time that he was engaged at Michelin his duties included engineering manager for the design, development and construction of production facilities of tyre cord, bead wire bundles and tyre components.

62 I accept, fully, the evidence of Mr Ochs. He described in detail the manufacturing process of tyres, including agricultural tyres. He also discussed the relative merits and demerits of the three types of bead referred to above.

63 The weftless bead (the type on the instant tyre) is fabricated by a process involving several wires (eight), forming a ribbon, that are wound in an overlapping configuration several times (seven) to complete a hoop. This is more formally called a weftless bead of 56 wires with an eight-wire overlap.

64 A programmed bead is fabricated by using one wire continuously wound for 56 wraps with an overlap of the outside end.

65 A cable hoop bead is formed by winding a continuous wire over a wire core and adjoining the wrap wire ends with a ferrule.

66 For the weftless bead and the programmed bead, each wire is usually surrounded with insulating rubber from an extrusion head or wrapped in some other manner. This is done to prevent unravelling during the curing process. In each case, the bead is formed by passing the wires through an extrusion head and then winding them around a mandrel of an appropriate diameter. With a cable hoop, the rubber extrusion is not necessary as the hoop maintains its shape as a result of the connecting ferrule.

67 In this case, according to Mr Ochs, the tyre failure was confined to the bead. I accept this evidence. Mr Ochs noted that the inflation pressure was at or below 15 psi; there was no evidence of mechanical damage at the point of failure; there was no reported evidence of inclusions or structural defects in the wire ends at the point of rupture; the wire ends (56 of 64) indicate a failure in tension (cupping and coning-necking). Eight of the wire ends were mechanically cut which, according to Mr Ochs, would indicate a weftless bead construction of an eight-wire wide ribbon wound seven times around itself (on a mandrel) with an eight-wire overlap. Mr Ochs concludes that the point of bead wire failure (rupture) is at the location of the beginning of the overlap of the interior diameter of the bead wire bundle. This is the location, he says, of the step or discontinuity created by the beginning of the eight-wire ribbon. This would be the location of the start of the wire ribbon wrapping process. In lay words, it is the inside end of the earlier-described weftless bead ribbon at which the bead and the tyre failed.

68 The Court directed that the engineering experts confer in a conclave. The parties were invited to suggest, and agree upon, a series of questions that would resolve the perceived differences between the experts. The questions and answers were admitted into evidence as Exhibit D. GWS objected to its admission into evidence and particularly objected to the admissibility of Question L in that Exhibit.

69 It is necessary to deal briefly with the objection. The objection to the question and answer was said to be based upon “the rule of court that prohibited the tendering of expert evidence unless a report has been served in advance: UCP r 31.18.” The submission of GWS is that because the conclave “was not by consent, the report of the conclave is to be regarded as a piece of expert evidence, and are (sic) subject to the rules of Court with regard to that evidence: UCP r 31.25(6).”

70 Natural justice requires that, in proceedings before a court such as the present, any evidence admitted against a party may be the subject of contradiction and testing by that party. Subject to that constraint of natural justice, and the rules of evidence, the method by which material comes before the court is generally a matter for the court. In particular, the Uniform Civil Procedure Rules are promulgated to effect the purpose described in section 56 of the Civil Procedure Act 2005 (NSW). The terms of section 56 of the Act prescribe an overriding purpose being to facilitate “the just, quick and cheap resolution of the real issues” in proceedings. That purpose must be given effect in exercising any power under the Act or the rules or in the interpretation of any provision. The terms of section 14 of the Act empower the Court to dispense with any requirement of the rules if the Court is satisfied that it is appropriate to do so in the circumstances.

71 More particularly, Division 2 of Part 31 of the Rules deals with expert evidence and expands upon the purposes with particular reference to that Division. Rule 31.17 recites that the main purposes of the rules that follow are, relevantly, to ensure that the Court has control over the giving of expert evidence; to restrict expert evidence to that which is reasonably required to resolve the proceedings; and to avoid unnecessary costs and other purposes. The Division entitles the Court to make directions as to the reducing of evidence by experts, and requires the party to seek those directions. Rule 31.19 provides that expert evidence may not be adduced unless such directions have been sought and may not be adduced in a manner that is not in accordance with the directions given. It is subjected to the proviso that the Court may otherwise order.

72 Rule 31.20 empowers the Court to give such directions that it considers appropriate as to the use of expert evidence. Directions that may be made by the Court under that rule deal with the service of reports; restricting the evidence that may be adduced, including the number of experts that may be called; requiring the appointment and instruction of a court-appointed expert; and, most relevantly, requiring experts in relation to the same issue to confer. Those directions may be made “at any time”: UCP rule 31.20. Reliance by GWS on the UCP Rules, to suggest that the report of a conclave ordered by the Court is inadmissible, is misconceived. Subject to the rules of natural justice and the rules of evidence, the Court governs its own procedure.

73 Further, the provisions of Schedule 7 to the Rules, being the code of conduct for expert witnesses (previously SCR Schedule K), require an expert to comply with the direction of the Court and to confer with another expert witness. I admitted the report of the conclave and I accept its joint opinion.

74 The questions and answers should be recited. Exhibit D is in the following terms:

“ A.
Q. Did the pressure gauge employed by Thomas Laws provide an accurate reading?
A. On the available evidence, the pressure gauge probably provided an accurate reading.

B.
Q. Was the compressor used by Thomas Laws to inflate the subject tyre regulated to deliver pressure of up to 75 psi and no greater?
A. On the available evidence, the compressor used by Mr. Thomas Laws was probably regulated to deliver a pressure of up to 75 psi and no greater.

C.
Q. Absent defect in the tyre, what was the burst pressure of the subject tyre?
A. From the F.E.A. analysis, and with a properly seated bead, the burst pressure was of the order of 120 psi.

D.
Q. What was the likely cause of failure of the subject tyre?
A. Likely cause of failure of tyre was localised over-stress of bead wire bundle at the wire overlap, caused by a tube-pinch-induced bead ‘hang up’.

E.

D.

F.

G.

employ trained tyre fitters to fit agricultural tyres.

H.

I.

J.

I.

K.

L.

It is unlikely that an experienced and trained tyre fitter would have this problem.”

75 The four experts who participated in the conclave were Mr Ochs, Professor Churches, Mr Simpson and Mr Barry Anderson. Mr Anderson was qualified by GWS, Motokov qualified Professor Churches and both Mr Ochs and Mr Simpson were qualified by Mr Laws Junior. There was some further evidence adduced from experts on liability.

76 From the expert and other evidence, including Exhibit D, I make the following findings:

i. The tyre provided by GWS, which was provided to it in 1998 and manufactured in or before 1998, was not a tyre which, at the time of its manufacture, was recommended in Australia for use on the wheel rim being used by Mr Laws Senior;

ii. There is a noticeable difference between the 12.4-28 tyres manufactured in or before 1998 and of those manufactured in or after 1999. That difference is the width of the tyre looking at the outer circumference;

iii. The 1998 manufactured tyre supplied by GWS, because of its width and “stiffness”, made it a more difficult tyre to fit and, more importantly, a more difficult tyre on which to observe whether the tyres had “seated” properly;

iv. In the hands of an expert, in this context an experienced and trained tyre fitter, the difficulty with the 1998-manufactured tyre would not, of itself, have prevented the tyre being fitted to a W9 rim, even though it was not recommended;

v. The 12.4-28 tyre should not have been sold by GWS otherwise than as one of a pair of tyres in circumstances where it was to replace an 11.2-28 tyre;

vi. The method of fitting the tyre adopted by Mr Laws Senior was an appropriate method, with the exception of the absence of appropriate safety procedures of which he was unaware;

vii. In fitting the tyre, and particularly while inflating the tyre with water, the combination of the larger sized tyre and the lack of expertise of Mr Laws Senior combined to render unnoticeable a tube-pinch-induced bead “hang up”, causing over-stress of the bead wire bundle at the wire overlap. This application of differential pressure on the bead wire breached the integrity of the bead wire and thereafter rendered the bead ineffective in containing the tyre within the rim;

viii. When the tyre was inflated with air to 15 psi, the tyre, which in accordance with the above had not been properly seated and the bead of which had been ruptured, exploded, causing injury;

ix. There was no warning provided by GWS to Mr Laws Senior at the point-of-sale and there was no warning provided by Motokov on or with the tyre;

x. While alternative methods of bead construction may have rendered the incident in question less likely, the manufacture of the bead, and of the tyre, did not produce an inherently defective product except when fitted by an inexpert or inexperienced person;

xi. Even if an 11.2-28 tyre had been sold (or a 12.4-28 tyre made to post 1999 specification) it should have been fitted by an experienced and trained tyre fitter;

xii. When a tyre is being fitted to a rim, it is inherently dangerous and is required to be fitted by an experienced and trained tyre fitter utilizing appropriate safety measures.

The Tractor Tyre As a Dangerous Product

77 As is made clear by the experts in their answers to the questions posited to the conclave, it was standard industry practice to employ trained tyre fitters to fit agricultural tyres. It was a specialist job that ought to have been undertaken by an appropriately qualified and experienced technician.

78 It is for the Court to determine whether it was appropriate to supply the tyre without instructions and warning of the relevant danger. The determination of appropriateness depends upon the existence of a duty of care and its content, together with the determination of that which amounts to a reasonable response thereto.

79 I have found that Motokov issued catalogues from time to time and, in particular, issued catalogues to GWS in 1999 and for the year 1998.

80 Some of the catalogues issued by Motokov to retailers make clear, and the evidence is overwhelmingly to the effect, that tyre fitting was a specialist job, to be performed by appropriately qualified and experienced technicians, in the absence of which the task was exceedingly dangerous with a real risk of serious injury and/or death.

81 This is not information and knowledge that is confined to experts. Any retailer of Barum tyres, who bothered to read the catalogue provided by Motokov, would have actual knowledge of these risks. The Barum booklet available at the beginning of 1999 (Exhibit 3), and in the possession of GWS at the beginning of 1999 and prior to the sale to Mr Laws Senior, said this:

“ Instructions for Mounting

Important Note

1. Tyres should be the correct size to vehicle type and suspected load capacity. Rims should be a correct size and in good condition (undamaged and free from corrosion).

2. The mounting should be accomplished in safely (sic) conditions on the plain ground (sic).

. . .

From safety reasons do not stay during the inflation directly in front of the tyre. The length of the hose between the tyre and the pressure gauge should allow cca 5 m. distance.”

82 As I have found that this catalogue was in the possession of GWS prior to the sale of the tyre to Mr Laws Senior, GWS had reason to know that the fitting of a tyre to a rim by a non-specialist was fraught with danger and had reason to know the steps that could be taken, and should be taken, to minimise or avoid the risk.

83 Even if GWS had not received the catalogue in question, previous catalogues had similar statements and retailers were otherwise aware of these issues. While the catalogue suffers from a poor translation of what was obviously a different original language, the import of the warning as to the risks is clear.

84 Further, if GWS had not received any catalogue, it had reason to know that the fitting of a tyre to a rim was dangerous, and inherently so. In 1999, the then managing director and principal of GWS, Mr Charlie Greentree knew of the dangers. Not only did he have reason to know of the dangers of fitting a tyre, he had actual knowledge. He gave evidence to the effect that he knew that, because of the danger involved in the task, in order to fit a tyre somebody was required who had to be trained to do it (Transcript page 1040). He said:

“Q. And yesterday you told his Honour that it was not until three to five years ago when you received the Mitas document that you were aware of the necessity to have professional people fit tyres and the dangers attached to the fitting, is that correct?
A. No, we’ve always had professional people fit tyres.

Q. No, no; of the necessity to have professional people fit or have you always known that you must?
A. That’s why we’ve always done, that’s why GWS have never done tyre fitting.

Q. Because of the dangers attached to it?
A. Yes.

after receiving the Mitas brochure that you would tell perhaps one in 10 - I’m summarising your evidence - tell one in 10 persons of the need to have a tyre professionally fitted?

A. Yes.

Q. So even though you had that warning from Mitas you say you still didn’t tell people?
A. That’s only in the latter years, after the accident.

Q. And even after you got the Mitas document it was only one in 10 that you would tell?
A. Yes.

Q. To get the tyre professionally fitted?
A. Yes.

85 In 1999, Mr Charlie Greentree’s son, Mr Mark Greentree, was the Assistant General Manager and later became the general manager. He also considered this issue at or before the time of the accident and possessed actual knowledge that the fitting of a tyre to a rim was dangerous and was required to be performed by specialists.

86 GWS was not a specialist tyre dealer. It sold tractors and spare parts for tractors, including tyres. It sold about 50 tractor tyres per year and had done so for approximately 20 years. It had ready access to two specialist tyre-fitting services for the purpose of fitting tyres it may sell.

87 At the time that GWS sold the tyre to Mr Laws Senior, there was actual knowledge in GWS of the dangers associated with the fitting of a tyre. While Mrs Laws had provided the size of the tyre to be replaced, it was on the basis of the GWS recommendation, and only that basis, that this 12.4 – 28 tyre, recommended by GWS, was used. Mr Laws Senior (and Mrs Laws and Mr Laws Junior) directly or indirectly relied upon the advice on the tyre size and its appropriateness.

88 GWS at no stage asked any questions about the size of the rim to which the tyre was to be fixed. Nor was Mr Laws Senior asked about whether water would be used as ballast in the tyre. (Indeed, it seems as if the use of water was assumed.) No offer was made to fit the tyre or to arrange for its fitting. No advice or warning was given in relation to the need for the tyre to be fitted by specialists or trained persons. Further, no explanation was given as to why it was necessary, or even desirable, to use trained or specialist tyre fitters.

89 Mr Charlie Greentree was not only aware, at or before the date of the sale and accident, that tyres ought to be professionally fitted, he conceded that, even after the accident, nine out of 10 times he sold such tyres to customers, including farmers, without insisting or advising that they be fitted by a specialist: transcript at page 1045. Further, notwithstanding his knowledge of the dangers, Mr Greentree did not consider that GWS had any obligation to inform a purchaser, nor any obligation to determine precisely the nature of the danger that may be posed to his clients: Transcript 1052, 1054.

90 On the other hand, Mr Laws Senior was totally unaware of the dangers associated with the application of pressure in the fitting process. He received from GWS no advice or instruction as to how the tyre ought to be fitted, by whom and why. Nor did he receive such advice from Motokov. There was no warning on the tyre itself and no accompanying documentation with a relevant instruction or warning. The evidence discloses that the process of embossing a tyre with a warning occasioned an initial, extremely minor, one-off cost and nothing more. The evidence discloses that such a process was inexpensive and easily achieved. Such warnings were common on tyres at that time and mandatory in a number of advanced countries. The initial one-off cost was a fixed cost that would be absorbed in the cost of the tyre and made no difference to the cost of production.

91 Further, the provision of printed material, either or both by sticker attached to the tyre, or small booklet also attached, with a warning or written material relating to the dangers, would have also been an inexpensive and easily achieved process.

92 It is clear that Mr Laws Senior was totally unaware of the risk on which he was embarking and the danger associated with fitting the tyre himself. It is true, as submitted by GWS, that the provision of a warning would not, itself, ensure adherence to the safety requirements. Notwithstanding the warnings on cigarettes, people still smoke. But they do so in the knowledge of the danger.

93 I accept that one should treat with extreme caution evidence from a witness as to what would have been her/his reaction to different circumstances: Berrigan Shire Council v Ballerini [2005] VSCA 159 per Nettle JA citing with approval Arnison v Smith (1889) 41 Ch D 348 at 369. Here evidence was adduced from Mr Laws Senior, concerning his reaction to a warning, if it had been given, namely, that the process would not have been undertaken.

94 However, here the evidence also discloses that Mr Laws Senior was a person concerned with ensuring the safety of himself and those around him. His description of the method that he utilised to fit the tyre and rim and to lubricate it in such a way as not to render slippery the part of the tyre on which he, or his son, may be required to stand exemplifies that attitude. While I will deal with the credibility of the witnesses at a later point in this judgment, Mr Laws Senior was a sincere, truthful witness, prone to understatement, whose evidence I accept, and, in particular, I accept that had he been aware of the dangers involved in the fitting process, he would not have undertaken the task himself and would have arranged and waited for a specialist tyre fitter to perform it.

95 I earlier noted that Mr Laws Senior was not unfamiliar with GWS. He had bought parts from them before and was in the process of purchasing a new tractor. Mr Greentree, likewise, and GWS were not unfamiliar with Mr Laws Senior. It was aware that Mr Laws Senior was not a specialist tyre fitter. If the tyre sold to Mr Laws Senior were to be fitted by him, it presented a known danger and a risk of serious injury or death. The danger and risk were known to GWS.

96 The tyre, in the hands of Mr Laws Senior, if used for its ordinary purpose and fitted by him, was an inherently dangerous product and known to be so by the vendor, GWS.

Existence, Content and Breach of Duty of Care of GWS

97 As the vendor, the standard to be adopted is that of a reasonable retailer in the position of GWS. No general responsibility is imposed on a vendor of goods for all damage or injury arising from the use of the goods. More particularly, no liability in negligence is imposed on a vendor of goods simply because of the sale and/or the relationship of the vendor and purchaser.

98 It is tempting, because of their necessary interrelationship, to confuse the existence of a duty of care and its content, if it exists. In dealing with the relationship of vendor and purchaser, there is, in these circumstances, a duty of care owed by the vendor to the purchaser. Difficult questions arise in determining the content of that duty.

99 In the textbook examples, one is reminded that one does not expect a supermarket to be responsible for detecting, or preventing, a dead bee in a can of soup. There are, of course, early examples in the law of negligence of the duty of care bypassing the vendor and imposing liability on the producer for snails in lemonade bottles, for example.

100 Neither example is inconsistent with the existence of a duty of care imposed on the vendor. They seem to be examples of the limitations on the content of that duty. It cannot be appropriate to impose upon the vendor of goods a legal liability for a defect in the goods, which was not known and could not be known, and which was not caused by the vendor’s own conduct.

101 The content of the duty of care owed by a vendor to a purchaser was discussed at length by the Court of Appeal in McPherson’s Ltd v Eaton [2005] NSWCA 435. While both Mason P and Hodgson JA agreed substantially with the reasons of Ipp JA, each expressed, in his own words, the content of the duty owed. His Honour the President, citing the judgment of the Court of Appeal in Laundessv Laundess (1994) 20 MVR 156, said:

Laundess

102 Later in his judgment, Mason P deals with the content more particularly and says:

“[17] In my view, it is both feasible and just to impose a particular content on the distributor’s duty of care, confining it to one requiring reasonable care in the avoidance of personal injury by reference to what the distributor knows or has reason to know. I later explain why this more stringent duty does not apply to the distributor who renders the product harmful by its own conduct. The meaning of ‘reason to know’ is also addressed below.

. . .

[22] But most distributor situations involve no more than omission by the distributor to disclose or warn about some inherent quality of the product distributed. The present case is an example. Unless one posits a general duty of care and concludes that the distributor’s conduct was reasonable in the circumstances, something more is required for these situations before a duty of care can be found, essentially for the reason adverted to by Professor Stapleton in her Sainsbury’s example. It offends common morality to find a distributor liable for nothing more than selling a dangerous product, at least if the danger of the product (generally, or in the particular case) is not known or within the ‘reason to know’ category as regards the distributor. Because it is not possible to posit why the duty should ever be wider, then it is appropriate to distinguish the approach endorsed for the ‘diving cases’ and to state a duty with the more confined content.

Elliott v Bail Bungy Co

The words 'reason to know’ … are used to denote the fact that the actor has information from which a person of reasonable intelligence or of the superior intelligence of the actor would infer that the fact in question exists or that such person would govern his conduct upon the assumption that such fact exists. The words ‘reason to know’ do not impose any duty to ascertain unknown facts, and are to be distinguished from the words ‘should know’.

[24] This formulation of the content of the duty of reasonable care is preferable to describing it in terms of a ‘duty to warn’. For some situations, warning would be an inadequate response. Reasonable care with reference to some dangers would require the product to be taken off the shelves.

‘with which a reasonable man, taking thought, would have foreseen that the child was likely to do himself an injury’

Yachuk v Oliver Blais Co Ltd

103 The reasons for judgment of Hodgson JA in McPherson’s, supra, also agree substantially with the reasons of Ipp JA. Justice Hodgson said:

“[27] I agree that a retailer of goods has no duty of care to persons who might ultimately be affected by those goods, unless there is some additional factor, generally a factor associated with the creation of risk or knowledge of risk involved in the goods. This is because there is, in my opinion, a world of difference between originating and putting into circulation something which otherwise would not exist, and merely being one of a number of persons involved in the distribution of something originated by someone else.”

104 In his reasons for judgment in McPherson’s, supra, Ipp JA analyses the authorities relating to the existence of a duty of care between vendor and purchaser. In doing so he refers, inter alia, to Imperial Furniture Pty Ltd v Automatic Fire Sprinklers Pty Ltd [1967] 1 NSWR 29 and extracts a passage from the judgment of Jacobs JA at 38 to 39 part of which says:

“An analysis of the cases on things dangerous in themselves with all the variety and variation which appear in those cases leads me to the conclusion that a thing is dangerous in itself when the danger of such a thing is of such public notoriety that a defendant will not be heard to say that he in particular did not know the danger. The notorious danger may arise spontaneously or only when the thing is used in some way in which it may reasonably be foreseen that it may be used, but in any case the danger must be publicly notorious. If a thing is notoriously dangerous it is in the same position as a thing known to the defendant to be defective. In either case it is not sufficient for the defendant to say that he was unaware of the danger. If there is a notorious danger, he cannot be heard to say otherwise. If the danger is not notorious but if there is a defect known to him, likewise he cannot be heard to say that he did not know of the danger.”

105 The analysis by Ipp JA of the authorities and cases in the area continued and his Honour cited the judgment of Young CJ in Eq in Elliott v Bali Bungy Co, supra, and summarised it. Ipp JA said:

Elliott v Bali Bungy Company

[82] In my opinion the relationship of vendor and purchaser, or vendor and end-consumer, does not automatically give rise to a duty of care. Such relationships do not fall within the familiar categories of cases where, by the mere existence of these relationships, a duty of care arises …. I agree with Mahoney JA’s view that ‘something more’ must exist before a duty of care arises.

[83] I come to this conclusion not only because of the authorities to which I have referred. There are compelling policy reasons for requiring the presence of some additional factor falling within the recognised criteria for the establishment of a duty of care. Without the requirement of some additional factor, a retailer would continuously be at risk if it did not investigate the potentially hazardous characteristics of all the products sold by it, and the constituents of such products as well. A large hardware retailer like McPhersons sells vast quantities of products of many kinds. Smaller retailers sell less but still sell many. The installation and implementation of systems discovering and identifying potential hazards of products and their constituents would be an expensive exercise for retailers. The increased costs could have considerable flow-on effects (affecting the financial capacity of some retailers to employ workers, the need to obtain costly insurance, the general cost of living, and the very viability of some businesses). In the end, the cost of complying with the proposed automatic duty of care would be borne by the community as a whole.

[84] The social need for recognising a duty of care owed automatically by a retailer simply because it sells a particular article is not strong. In the circumstances in which it might be sought to hold such a retailer liable for a defect in the article, it is likely that liability would attach to the manufacturer …. The proposition that retailers owe an automatic duty of care amounts, in effect, to the retailer being vicariously liable for the fault of the manufacturer in producing a defective article. This is not a proposition that our law has embraced.”

106 In McPherson’s Ipp JA thereafter deals with whether the “something more” is that the retailer “ought to know” or “has reason to know”, after which his Honour deals with the application of the duty to the factual position involved in those proceedings.

107 The reasons for judgment of Mason P refer to the “same” duty and the “content” both of which seem to refer to the content of the duty, rather than its existence. On the other hand Ipp JA and Hodgson JA each refer to the “existence” of a duty of care. I am bound to accept that the “something more” is a condition on the existence of the duty, rather than its content. For my own part, I prefer the approach of Mason P.

108 Since writing the above passage I have been referred to the reasons for judgment of the Court of Appeal in Pesl v Ray Smith Tractors [2007] NSWCA 74. In Pesl, Tobias JA, with whom Beazley and Ipp JJA agreed, adopted and applied the reasoning of Ipp JA in McPherson’s and confirmed the approach by which I am bound, namely, that the “something more” (knowledge or reason to know) conditions the existence of the duty, rather than its content.

109 I apply a test on the existence of a duty of care that requires, in a situation of vendor and purchaser, that the vendor must know or have reason to know before such a duty will be held to exist. I am bound so to do. For my own part such a test seems to have more to do with the content of any duty rather than its existence.

110 Strangers are not liable in negligence to take reasonable care to prevent foreseeable harm, even when they have reason to know of the dangers.

“A defendant will only be liable, in negligence, for failure to take reasonable care to prevent a certain kind of foreseeable harm to a plaintiff, in circumstances where the law imposes a duty to take such care.

Donoghue v Stevenson

Different classes of case give rise to different problems in determining the existence and nature or scope, of a duty of care. Sometimes the problems may be bound up with the harm suffered by the plaintiff, as, for example, where its direct cause is the criminal conduct of some third party. Sometimes they may arise because the defendant is the repository of a statutory power or discretion. Sometimes they may reflect the difficulty of confining the class of persons to whom a duty may be owed within reasonable limits. Sometimes they may concern the need to preserve the coherence of other legal principles, or of a statutory scheme which governs certain conduct or relationships.

Sullivan v Moody

111 Absent the existence of a relationship of vendor and purchaser, there would not be a duty of care whether or not there was “something more”. Whether, in the current circumstances, “something more” defines the existence of the duty of care, limits its content, or is a necessary element of the breach of the duty makes no practical difference to the determination of liability. There must be “something more” before liability can arise. As already stated I am bound by the view that there must be “something more” before a duty of care arises and I apply that test in determining whether GWS has such a duty.

112 Uninformed by the judgments of the Court of Appeal I would have thought that a duty existed between vendor and purchaser, the content (nature or scope) of which was that the vendor would take reasonable steps to prevent foreseeable harm to the purchaser (and that foreseeable class of persons utilising the goods through, for or with the purchaser) from the sale. In those circumstances, knowledge (or reason to know) would limit liability because it would condition foreseeability and/or the reasonableness of the steps to be undertaken. However, as previously stated, the law I apply is now clear and knowledge or reason to know preconditions the existence of the duty, not its nature or scope. Further, also as previously stated, such a condition, whether it limits the existence or scope of the duty, is appropriate and necessary and regardless of the point (existence or scope) at which it applies has, at least in this case, no different effect.

113 On the evidence in these proceedings, the vendor, GWS, had actual knowledge and “reason to know”. To the extent necessary, I also find that it “ought to have known”. There can be no doubt that the “something more” existed such as to enable a finding that there existed a duty of care owed by GWS, as the vendor of the tyre.

114 In determining the extent of the duty I apply the approach encouraged by Hayne J in Modbury Triangle v Anzil (2000) 205 CLR 254 at [105]. I examine the damage suffered by the two plaintiffs, the absence of care of GWS and whether those two aspects combined resulted from the breach of the duty, which GWS owed.

115 In this case, the damage that was suffered by each of the plaintiffs was the personal injury occasioned by undertaking a task that was known by GWS to be inherently dangerous. As I have already found, if the risk involved in undertaking the task had been appreciated by Mr Laws Senior, the task would not have been undertaken. That which was necessary to satisfy the duty of care imposed on GWS was to inform Laws Senior of the risk and danger involved. GWS did not, in any appropriate way, or at all, inform Mr Laws Senior of the risk and danger and therefore GWS was in breach of the duty of care imposed upon it as a vendor of goods that knew or had reason to know of the dangers involved in those goods.

116 The injuries sustained, to which I will refer later, are injuries of a kind which were foreseeable and the persons injured, being the purchaser of the goods and a person assisting him in the task of fitting them, were of a class of persons who were foreseeable as persons likely to have been injured and the failure to warn of the risk and/or danger is directly causative of the injury or injuries in question. To paraphrase Jacobs JA there is a notorious danger because “the thing is used in some way in which it may reasonably be foreseen that it may be used” and when so used “there is a defect known to [it], [and GWS] cannot be heard to say that [it] did not know of the danger”: Imperial Furniture, supra.

117 Because I have found that an appropriate warning given to Mr Laws Senior would have resulted in him not performing the task, the chain of causation is established and the breach of duty caused the injury.

118 The warning was required regardless of the size and specifications of the tyre. While the size and/or specifications of the tyre sold rendered more probable the occurrence of an accident of this kind, such an accident was foreseeable (and probable) regardless of the tyre sold and stems from the necessity to have only trained persons engaged in tyre fitting.

119 The question I have not examined is whether GWS (or a vendor in their position) would have foreseen that the failure to draw to the attention of Laws Senior the risk and/or danger of fitting the tyre himself involved a risk of injury to Laws Senior and Laws Junior (being two members of that class of persons). The answer, given the actual knowledge of danger, must be in the affirmative.

120 Once the above issue is answered in the above manner, the issue to which I must turn is what steps, if any, would a person in the position of GWS, acting reasonably, take. Is a response to the risk reasonable? And, if so, what response?

121 The evidence discloses that the risk was that grave injury (perhaps death) would be caused if an untrained or inexperienced person fitted the tyre. The probability of the risk being realized must be considered in light of the seriousness of the foreseeable injury if it were realized. One must then evaluate the difficulty of obviating the risk (or minimizing it), including expense and inconvenience, and weigh that difficulty against any competing responsibilities: see, generally, Wyong Shire Council v Shirt (1980) 146 CLR 40 at 47 per Mason J.

122 In this case, the risk can be eliminated (and the purchaser put in the same position of knowledge as the vendor) by a simple warning and/or provision of information sufficient to allow the purchaser to evaluate for himself the risk in question.

306 The reports tendered on quantum by GWS suffer from some significant problems. None of them, I hasten to add, reflect on the integrity or capacity of the experts who have compiled the report.

307 It seems from the material that I have accepted that there was a significant deterioration in the prognoses for Laws Junior between the early period and later periods. As a consequence the report of Dr Sekel, dated 22 May 2002, on the findings I have made, do not meet the factual circumstances which have been adduced in evidence. Nor does his report of 22 July 2002. On the material that was before Dr Sekel, he came to the view that he “now appears physically and intellectually fit to return to work as a performer in a band”. The material that I accept as an accurate reflection of the condition of Laws Junior is such that he neither hears sufficiently well to play in a band nor sees sufficiently well to read music. Loud music induces pain in his ear. Further his capacity to play an instrument as described in evidence is a capacity to play for extremely short periods following which the weakness in his arms and his trembling prevents it. So too does his lack of concentration.

308 Further the assessment of Dr Sekel that Laws Junior is “physically fit to work as a process worker in situations where fine sense of depth is not required” is, on the material adduced in these proceedings, which material is accepted, relating to his condition in later years, manifestly incorrect. The permanent and untreatable loss of hearing, balance, taste and smell and tinnitus, all described in the report of Dr Leon Gillam, tendered by GWS, is seemingly inconsistent with the proposition that he could perform as a guitarist on stage and in the midst of loud music. No countervailing reports are tendered to qualify in any way the issues associated with loss of sight and loss of concentration.

309 I have earlier remarked at the inability of Laws Junior to comprehend the full extent of his disabilities. Further his adynamia and amotivation is seemingly crippling. None of these factors seem so have been given appropriate weight in the formation of the opinions of the rehabilitation specialists qualified by GWS. Nor have they taken account of the risk-taking activities of Laws Junior, which activities are seemingly undertaken because he fails to appreciate his limitations.

310 Professor Jones was called by GWS and his report forms part of Exhibit 23. His report is dated 18 August 2005. He refers to the trip of Laws Junior to the examination and his post traumatic epilepsy. He also notes that, as at 18 August 2005, that the last epileptic seizure was June 2005. Professor Jones recites continuing physical disabilities as recounted by Laws Junior and came to the opinion that:

“Mr Laws has suffered severe head injuries with continuing brain impairment notably double vision, visual field impairment, left auditory loss, loss of the sense of smell, and epilepsy. There is sparing of much of his cognition although his memory is adversely affected. I would regard him as independent in personal care and in some activities of daily living of a domestic nature. He lives in a protected environment with his parents and/or girlfriend who undertake domestic chores for him, although I am of the view that he would have the capacity to undertake some of those domestic activities himself with a little extra training.”

311 The first aspect of the above opinion is that the physical capacity of Laws Junior to undertake such activities is not in issue in these proceedings. The safety issues addressed by Professor Jones relate to the physical issues associated with his loss of smell and the risk of fitting. Professor Jones is “not of the opinion that [Laws Junior] requires 24 hour per day care”. Professor Jones accepts that “the injuries that [Laws Junior] has sustained as a result of the accident of 10 March 1999 have substantially impacted upon his capacity to engage in his normal domestic, social and recreational activities”. He concludes that the prognosis of Laws Junior “is guarded and there are many impairments that [Laws Junior] still suffers, although they are more significantly of a cosmetic nature.”

312 The only “cosmetic” impairments, on the evidence, is the scarring over the head from ear to ear and perpendicular to it to the temple and the eye movement [the “see-saw nystagmus”]. As such the proposition that the impairments of Laws Junior are “more significantly cosmetic” is rejected. Further this opinion is formed without regard to the most telling disabilities suffered. Professor Jones does not deal with the lack of insight into incapacity; the adynamia and amotivation; and the consequential risks associated with those problems. I cannot therefore accept the opinion. It does not deal with the issues that Laws Junior faces and cannot be an accurate view of his care needs.

313 The same criticism, although different in the details, applies to the report of Tony Mitchell, Consultant Physiotherapist, of 13 August 2003 and, although reference is made to the adynamia/amotivation aspects, to the report of Raymond Field, Clinical Occupational Psychologist.

314 The issue that must then be addressed is the issue associated with the assessment of the level of care and its translation into practical steps for the care of Laws Junior.

315 As previously stated Laws Junior tenders and relies upon the three reports of Ms Linda Shepherd, Occupational Therapist. The report of Ms Kareena Henry, Occupational Therapist dated 9 July 2003 was originally tendered but she was unavailable overseas and the report was withdrawn. Because of Ms Shepherd’s involvement in the first report of 9 July 2003 over the signature of Ms Henry the “Henry Report” was the subject of some evidence before the Court. There are three reports tendered authored by Ms Shepherd dated respectively 13 October 2005, 21 October 2005 and 19 April 2006. The defendants, in particular GWS, rely upon the reports of Ms Joanne Oates and Ms Sue Beaver.

316 As a result of the differences in opinion of the occupational therapist, and with the consent of the parties, the occupational therapists relied upon by each of the parties was ordered into a conclave for the purpose of seeking to resolve the differences between them and to answer the question as to the recommended levels of care on certain factual scenarios. Unanimity was not forthcoming and while there is a joint report (Exhibit 11), the report was said, by Ms Shepherd, not to have altered her view as to the need for care.

317 Exhibit 11 commences with a general comment as to the holistic approach of occupational therapists generally and in particular those that were participating in the conclave. The report then sets out five areas of clinical testing and observation to determine an individual’s ability. They are:

(a) Physical Skills: range of motion; strength; coordination; and balance.

(b) Cognitive Skills: self-monitoring; memory; problem-solving; perception; planning and sequencing; initiation; and motivation.

(c) Sensory Skills: visual; auditory; tactile; smell; pain; and temperature regulation.

(d) Interpersonal Skills: functional, written and verbal communication; behaviour; social skills; and interaction with familiar and non-familiar people.

(e) Intrapersonal Skills: self-esteem/confidence; insight/awareness; initiation/motivation; and emotional status, including stress, anxiety and depression.

318 The conclave report makes clear that there is a variation in the opinions of the participants based, predominantly, on the disparity of information provided by Laws Junior and his family and the variety of medical reports provided. There was also a difference between them as to the degree of learned dependence, which was the subject of examination, and cross-examination of both the medical and occupational experts together with members of the family. Exhibit 11 then refers to the care regimes and provides two options. The distinction between the two options is that option 1 reflects the adynamia, and initiation and completion of tasks to which reference is made in the most recent medical evidence of Doctors Jungfer and Buckley. Option 2 is based on a lesser level of problems in those areas. Option 1 is in the following terms:

“Question 3

The following care regimen has been agreed on assuming that adynamia, initiation of tasks and completion of same as well as behavioural/intrapersonal problems are as acute as reflected in the most recent medical evidence of Dr Jungfer (30/8/05) and Dr Stephen Buckley (9/6/05).

7am-9am: Attendant care to assist with rising, initiating and executing self-care and domestic chore regime, as well as monitoring medication and planning daily tasks + transport if required.

9.00am-4pm: Daily activity as structured by a case manager eg. Community program
Sheltered employment
Avocational activity eg Shooting
Transport assistance home is supported.

Supervision of activity not considered necessary for safety.

6.00-8.00pm: Attendant care to assist with meal planning + preparation, hygiene, evening activity planning + medication.

8.00-10pm: Evening activity of choice.

On weekends and days when @ home an additional 2.5 hours is recommended in the middle of the day to prompt lunch and meds, monitor behaviour and do additional domestic chores, community tasks, financial management etc. This is on the assumption that a likely split of at home and away days is 3:4.

Provision of occupational therapy for an initial intensive period (say 20 hours one-off) + attendant carer training (say 10 hours one-off)

319 Because I accept the most recent medical evidence of Doctors Jungfer and Buckley it is unnecessary for me to deal with the care proposals contained in Option 2 of Exhibit 11.

320 Further even in relation to Option 1 there are some significant difficulties with the acceptance of this material. First, it is clearly inconsistent with the reports of Doctors Jungfer and Buckley, who prescribe 24-hour care. Secondly, as was made clear in the evidence of Ms Oates, the conclave had received the later reports of Doctors Jungfer and Buckley only on the morning of the conclave and was not, at the time of the report, fully conversant with all of its details. Thirdly, the conclave, in both Option 1 and Option 2, took account of neither the anxiety displayed by Laws Junior nor the risk-taking activities in which he had been engaged during the time that he was unsupervised.

321 In that latter regard Ms Oates said:

“… There was a reference in Dr Jungfer’s report, and I only read it that morning, to risk-taking behaviour, being unsafe crossing the road and being unsafe in an unsupervised setting. There was no clear examples amongst any of the occupational therapists that that behaviour had been demonstrated and there were no clear examples in the evidence that we reviewed that Mr Laws had participated in anything risky or that put his safety in danger. So that was the thing that was not taken into consideration because there were no concrete examples that he had participated in risk-taking behaviour.

Question: And that process that was taken, do you regard that as consistent with sound clinical practice in your area of discipline?

Answer: Yes.

Question: Do I take it that what was not taken into account was the risk-taking feature of the issues; is that right?

322 The proposals in Option 1 must therefore be qualified by the absence of any consideration of the risk-taking features of the activities undertaken from time-to-time by Laws Junior, if the Court concludes that there are risk-taking features. As I have sought to make clear, the Court has so concluded.

323 The other matter of concern was the effect of a film of the activities of Laws Junior. The film did not disclose all of the time during which Laws Junior was the subject of surveillance and the film that was tendered was not all of the film that was available to the defendant. Nevertheless there are aspects of the film and the depiction of the activities of Laws Junior, which the defendants say are inconsistent with the evidence given in Court.

324 I do not accept that submission. The surveillance, in general, shows Laws Junior as a passenger in a car; as a passenger on a train; crossing the road; and going into a shop. Other activities are disclosed. In each of the activities filmed, Laws Junior was in the company of others. The activities were matters about which evidence was given by the family members and others who have been involved in his care.

325 The film is not inconsistent with, and requires no greater concentration levels than, the activities of a child. Further evidence was adduced that during the time of these excursions, for example, Laws Junior sought to cross the road in front of an oncoming car and one of his companions was required, urgently, to grab him and pull him back on to the footpath.

326 It is the risk-taking aspects of the activities of Laws Junior, together with the inability of the medication to control his seizures totally, that is most relevant the level of care recommended by Doctors Jungfer and Buckley.

327 The other aspect of Option 1, which is problematic from the point of view of the Court, is that it assumes, for which there is no evidence, that there would be supervised community activities available and appropriate for Laws Junior to enable him to go without supervision for the period between 9am and 4pm.

328 There is no evidence before the Court that there are programmes in the community that meet the kind of problems with which Laws Junior suffers. Further if “avocational activity” were undertaken, presumably it would require transport and supervision. This was (even without the availability of the conclave report, Exhibit 11) the evidence of Dr Buckley. Likewise the period of unsupervised time at home assumes that, during that time, Laws Junior would be unable to be involved in activities, which were unsafe. Every day activities always contain some element of risk. Even young children undertake activity with risks. If they did not, they would not develop. However, in the case of Laws Junior we have a person who knows how to undertake tasks; has no motivation or organisational capacity to undertake them at the correct time; and has no understanding of his incapacities. In those circumstances to leave Laws Junior in a home unsupervised would be courting disaster. Further, absent a restraint on his freedom (e.g. if he were locked in a room) there would be no way of ensuring those risk activities were not undertaken or that he would not leave the home and undertake even riskier (and unknown) activities.

329 I have already stated that I do not consider that the family has inhibited or discouraged the undertaking of activities by Laws Junior. The family sought (and seeks) to have Laws Junior undertake tasks as often as is possible. They include going to the local shop, although he is capable, at that shop, of buying only one item. He can go to the local shop to buy a hamburger. It assists that each of the local shop owners knows him and the problems that he suffers. One of them was prepared to try him out in a job and the family encouraged him to undertake it.

330 It is true that with proper case management an occupational therapist may be able to plan his activities in a way that increases his level of independence. It is also true that the case manager may not be able to do so. Dr Buckley opines that it is impossible and I accept that it is more probable than not that no improvement can be achieved. However routine one may make the undertaking of certain tasks, one cannot plan a day that obviates the risk-taking activities of Laws Junior, unless there is supervision.

331 Some evidence was adduced relating to the capacity or availability of alarm systems that would enable persons to be contacted if Laws Junior went into certain parts of the house or undertook certain activities. If that were utilised, you would still have to have a person available to respond to the alarm. And the response would necessarily be ex post facto.

332 However a combination of the alarm system with other measures would seem to enable the provision of 24 hour care otherwise than by way of shifts. In other words, the provision of an alarm system of the kind referred to in evidence would seem to allow the provision of 24 hour live-in care in circumstances where the carer was not necessarily on duty, or on duty at all times, during the night.

333 Unfortunately, on the current evidence, that would mean any such carer would have an extremely disturbed sleep. There is a possibility (although it is improbable) that the proper case management effected for Laws Junior would result in more taxing and interesting activities during the day and thereby allow him to sleep better and in a manner which was less disturbed. This was a suggestion made, although no expert or other evidence was adduced to prove it or its possibility. It is also possible to fix alarms, and effect alterations to the house (e.g. an attached office and en-suite bathroom), which would allow Laws Junior to undertake some activities (e.g. television, X-Box and other computer games) that are without additional risk. Even if he were then to wake during the night, he could engage in activities without leaving his immediate environs and the alarm system, of which evidence has been given (or something similar), would alert the carer (or a family member) if Laws Junior were to venture beyond his immediate environs.

334 On the evidence before the Court, a live-in would not have undisturbed time in which to sleep. The probability is that state of affairs would continue. However there is a possibility, as earlier stated, that proper case management would improve the situation. That possibility is not strong. I will award 24-hour care on a live-in basis (i.e. not on the three shift basis claimed) but, I will make due allowance to the probability that the night shift will not be undisturbed. That can be done in one of two ways. First, it can be effected by providing for the higher rates for the night shift; or, secondly, by making allowance for greater relief (and therefore payment) for the carer. The latter course is a less expensive course and I will make an order on that basis.

335 The plaintiffs have tendered a range of material dealing with the cost of carers. Most of the cost issues to which reference has been made, and certainly the schedule of damages, refers to 24-hour care on a shift basis. Further it presupposes different persons working as the carer. On the other hand, the defendants rely upon the material tendered by GWS going to the cost of care, and in particular the cost of 24-hour care. GWS tendered Exhibit 34 which is the schedule of service fees and charges for New South Wales for Australian Home Care Services Pty Ltd. This is not the Home Care Service of New South Wales. The schedule of calculations upon which the defendants relied was technically not in accordance with that schedule. I make no criticism but it seems that the schedule sets out under the heading “rate per hour” a rate for 24-hour live-in care ranging between $291.42 to $582.85 (depending upon whether it is a weekday, weekend or public holiday). GWS, appropriately in my view, treated these rates as daily rates notwithstanding the terms of the schedule.

336 The particular and peculiar problems suffered by Laws Junior require 24-hour live-in care. To that much I have already alluded. The particular problems associated with anxiety and associated with his amotivation and risk taking require, in my conclusion, a particular knowledge of the idiosyncrasies of Laws Junior. The rates that are set out in Exhibit 34 are significantly lower than the rates upon which Laws Junior relies. The differences, in part, seem to relate to the necessity for long-term as distinct from short-term care. If, as I consider to be the case, the sleep of a live-in 24-hour care worker will be disturbed, a greater degree of relief will be required. I further take into account the probability that there will be no improvement in Laws Junior and the possibility that there could be. I determine that an appropriate level of compensation for the required care can be assessed by using the scale of fees referred to in Exhibit 34 but providing for relief (i.e. an extra two days per week on the weekday rate, ten public holidays and four weeks annual leave) while the live-in carer is still paid.

337 On the above analysis the rate per week (i.e. five week days and two days of the weekend) is $2,331.38. To that must be added two further week days at $582.84 making a weekly cost of $2,914.22. Further allowing ten days of public holidays relief is $5,828.50 per annum and four weeks annual leave (at $2,914.22 per week) results in an annual addition of $5,828.50 plus $11,656.88 or $17,485.38, resulting in a weekly increment of $336.26 and a total weekly cost of $3,250.48.

338 I turn then to deal with the issues relating to economic loss. The submissions of Laws Junior are to the effect that I should use as the measure of economic loss average weekly earnings. GWS (and because they support these submissions, Motokov) submits that the average weekly earnings, being only a statistical figure bears no relationship to the earnings of Laws Junior. Laws Junior essentially enjoyed two sources of income. First, as earlier indicated, he played in a band that was relatively successful. The future success of the band and its potential earnings is not taken into account by me in any award of damage in this case. He also earned money as a “dividend” from the development activities that he and his father undertook. As earlier stated, the evidence discloses that he developed houses which his father and/or mother bought and sold and from which he was paid a figure, seemingly based upon whatever his mother and/or father thought was fair.

339 Mr Laws was a tradesperson carpenter. The minimum rate of pay for a tradesperson carpenter is $673.36 per week under the awards that apply in New South Wales. The average weekly ordinary time earnings for an adult male in New South Wales as at February 2007 was $1,180.60. It is notorious that the minimum wage would not be the earnings of a carpenter, but average weekly earnings also includes chief executive officers of major corporations. Their number is so small that the significance of their earnings does not affect dramatically the level of average weekly earnings. However I am not prepared to estimate the loss of income at $1,180.60. I accept that whatever the source of the income (including capital gains from development) it would be as much or greater than that which could have been earned by Laws Junior as a carpenter and I estimate future earning capacity at current value of $1,000 per week giving a net wage (including Medicare levy) of $764 per week. I use the same figure for both past and future economic loss. Because I am basing the economic loss on wages (either carpenter or average) the benefit of superannuation must be added and the judgment will include that amount.

340 The other matters in the calculation of damage are not particularly contentious. I allow an amount of $100,000 for the alteration to the premises. In my view this is an underestimation given that I have based the calculation of care costs on an assumption that alterations will be made not only to provide for a live-in carer but also to allow for an ensuite toilet facility and computer area in or attached to the bedroom in which Laws Junior sleeps. I have also assumed that the alarm system suggested by GWS will be implemented and I allow $892 for that amount. Given that in order to obviate the far more expensive care requirements associated with shift carers I have assumed a ready available study area or computer area, additional computer costs ought also to be allowed as ought additional hardware and software arrangements so that there can be more than one area in which a computer can be used. However, I do not allow those extra amounts but only that estimated by counsel.

341 The last damages matter to which I will make specific mention before setting out a schedule of the damages as I calculate them is the question of general damages. As can be seen from the history of this accident and the injuries suffered by Laws Junior, the general damages need to be significant and within the range of damages that may be awarded for personal injuries of this kind. The amounts proposed by Laws Junior is within the range that could be awarded. Taking into account all of the aspects of this case and bearing in mind the significance of the amounts otherwise awarded I award for general damages the amount of $320,000.

342 Lastly, before setting out the damages that I would award, I make two further comments. First, whatever the level of damages here awarded it will not compensate in any real sense for the loss of a meaningful life into the future. As earlier stated, even though the plaintiff looks and acts superficially “normal”, every aspect of his life is affected prejudicially by the accident that has occurred. Secondly, it would have been preferable, in the assessment of damage, for the Court to have had available (and for the plaintiff to have had available) a case management assessment of the kind suggested by both the defendants and the plaintiff and an attempt at the implementation of it. Such a course may have obviated parts at least of the controversy that has come before the Court. Lack of resources by the plaintiff made that impossible from their perspective, and the denial of liability by the defendants made it improbable from theirs. All the parties and the Court are prejudiced because, in a case such as this, the process of litigation prevents certainty and delays potential treatment. I propose damages in the following categories and for the following amounts:

343 On the above basis and otherwise accepting the regime in the reports of Doctors Jungfer and Buckley and Ms Shepherd I propose to order damages calculated in the following way:

(a)	General damages	$320,000.00
(b)	Interest on past general damages	$160,000 x 2% x 8.25 years	$26,400.00
(c)	Past economic loss	$764 per week x 430 weeks	$328,520.00
(d)	Interest on past economic loss	$328,520 x 4.75% x 8.25 years	$128,738.77
(e)	Future economic loss (calculated on the basis of Laws Junior being 34 years of age and working to the age of 65)	31 years to age 65 x 1059.2	$809,228.80
(f)	Past superannuation losses	based on average past compulsory superannuation levy of 8.5% and gross wage of $1,000 per week over 430 weeks	$36,550.00
(g)	Interest on past superannuation	$34,465 x 4.75% x 8.25 years	$14,320.03
(h)	Future superannuation losses	$1,000 at 9% x 1059.2	$95,328.00
(i)	Past gratuitous care (i) 12 hours prosperous assistance per day while hospitalised (16.9 weeks) (ii) from 6 July 1999 to 1 June 2007 (413.1 weeks at average commercial rate of $22.75 per hour	16.9 x 7 x 12 x $22.75 ($32,295.90) 413.1 x 7 x 24 x $22.75 ($1,578,868.20)	$1,611,164.10
(j)	Interest on past gratuitous care	$1,611,164,10 x 4.75% x 8.25 years	$631,374.93
(k)	Future care requirements (calculated on the basis explained above together with initial case management of 48 hours in the first 6 months at $120 per hour and thereafter 4 hours per month) (i) Case management – initial six months ($5,760) – 4 hours per month x $120 per hour x 51 years (1374.4) postponed by 6 months (0.986) (4 x 12 x $120 / 52 x 1374.4 x 0.986) ($150,109.83) Total case management ($155,869.83) (ii) Gardner/handyman 3 hours per fortnight @ $39.50 per hour = $59.25 per week x 1374.4 ($81,433.20) (iii) Attendant care $3,250.48 x 51 years (1374.4) = $4,467,459.70	$4,704,762.70
(l)	Special needs (As per the report of Ms Shepherd and the submission of the plaintiff Laws Junior) And Alarm System ($892)	$832 + $14,074 + $892	$15,798.00
(m)	Holiday requirements	$150,139.00
(n)	Accommodation requirements	$100,000.00
(o)	Computer needs	$46,359.00
(p)	Past out-of-pocket expenses (as agreed)	$3,064.75
(q)	Future out-of-pocket expenses (in accordance with the schedule provided by Dr Buckley): Total claim in respect of future out-of-pocket expenses: (i) 6 visits to general practitioner per year (ii) 2 visits to a rehabilitation specialist per annum (iii)2 visits to the neurosurgeon per annum (iv) 1 visit to the ophthalmologist per annum (v) $50 per month pharmaceutical (vi) 4 psychiatric sessions per annum (vii) 6 physiotherapy sessions per annum ($72,486) (viii) gym and pool membership ($80 per month), $18.46 per week for life (x 1374.4) ($25,371) (ix) occupation therapy 101 hours at $185 per hour + 19 hours travel time $150 ($21,535) (x) future surgery and hearing aid ($5,272)	$124,714.00
(r)	Costs of funds management to be assessed

344 I propose an award of damage for John Rodney Laws in the amount of $9,146,462.05.

345 The date of effect of any award made will be 1 June 2007.

346 As in the case of Thomas John Laws I propose to allow the plaintiff time to elect to obtain damage under tort and time to provide figures and material relating to the cost of funds management and to provide to the Court the agreed out-of-pocket expenses. I request that each of the parties check the arithmetic in relation to the claims in which they are a party and I set the matter down for the making of final orders on a date to be determined.

347 I propose the following orders:

(i) Judgment for the plaintiff against the first and second defendants in the amount of $272,433.79;

(ii) Each of the first and second defendants contribute 50% of the judgment sum;

(iii) The first and second defendants pay the costs of the plaintiff of and incidental to these proceedings, as agreed or assessed; and

Uniform Civil Procedure Rules 2005

Civil Procedure Act 2005

(i) Judgment for the plaintiff against the first and second defendants in the amount of $9,146,462.05;

(ii) Each of the first and second defendants shall contribute 50% of the judgment sum;

(iii) The first and second defendants shall pay the costs of the plaintiff of and incidental to these proceedings, as agreed or assessed;

(iv) Otherwise, the proceedings, including the cross-claim be dismissed; and

Uniform Civil Procedure Rules 2005

Civil Procedure Act 2005

348 I make the following orders:

(ii) Leave is given for each plaintiff to inform the Court of the election as to damages in negligence and for that purpose to notify the Associate to Justice Rothman and each other party of the election by close of business 12 June 2007;

(iii) Leave is granted to all parties to notify and serve any alleged miscalculation in the reasons for judgment by that date and for any special or different basis for the order for costs; and

(iv) The parties are directed to confer and the plaintiffs shall file a formal minute of the orders arising from these reasons for judgment.

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Citations

Laws v GWS Machinery Pty Ltd & 2 Ors; Laws v GWS Machinery Pty Ltd [2007] NSWSC 316

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CITATION:	Laws v GWS Machinery Pty Ltd & 2 Ors; Laws v GWS Machinery Pty Ltd & Anor [2007] NSWSC 316
HEARING DATE(S):	01/05/2006-05/05/2006; 08/05/2006-12/05/2006; 15/05/2006-19/05/2006; 22/05/2006-25/05/2006; 27/06/2006
JUDGMENT DATE :	4 June 2007
JURISDICTION:	Supreme Court
JUDGMENT OF:	Rothman J
DECISION:	The Court proposes the following orders: A. In 20084/2002, Thomas John Laws (Laws Senior): (i) Judgment for the plaintiff against the first and second defendants in the amount of $272,433.79; (ii) Each of the first and second defendants contribute 50% of the judgment sum; (iii) The first and second defendants pay the costs of the plaintiff of and incidental to these proceedings, as agreed or assessed; and (iv) Pursuant to Rule 36.4(3) of the Uniform Civil Procedure Rules 2005 (NSW), this judgment comes into effect on and from 1 June 2007 and interest pursuant to s.101 of the Civil Procedure Act 2005 (NSW) accrues from that date. B. In 20076/2002, John Rodney Laws (Laws Junior): (i) Judgment for the plaintiff against the first and second defendants in the amount of $9,146,462.05; (ii) Each of the first and second defendants shall contribute 50% of the judgment sum; (iii) The first and second defendants shall pay the costs of the plaintiff of and incidental to these proceedings, as agreed or assessed; (iv) Otherwise, the proceedings, including the cross-claim be dismissed; and (v) Pursuant to Rule 36.4(3) of the Uniform Civil Procedure Rules 2005 (NSW), this judgment comes into effect on 1 June 2007 and interest pursuant to section 101 of the Civil Procedure Act 2005 (NSW) accrues from that date. The Court makes the following orders: (i) Both matters stand over until 9.30am on 14 June 2007; (ii) Leave is given for each plaintiff to inform the Court of the election as to damages in negligence and for that purpose to notify the Associate to Justice Rothman and each other party of the election by close of business 12 June 2007; (iii) Leave is granted to all parties to notify and serve any alleged miscalculation in the reasons for judgment by that date and for any special or different basis for the order for costs; and (iv) The parties are directed to confer and the plaintiffs shall file a formal minute of the orders arising from these reasons for judgment.

CATCHWORDS:	NEGLIGENCE – DUTY OF CARE – vendor and purchaser – actual knowledge of dangers – reason to know – vendor liable – importer/wholesaler liable – warning required – reasonable response – causation. TRADE PRACTICES ACT – meaning of consumer – used up in process of repair – tractor tyre not ordinarily acquired for domestic purpose – consumer except for purposes of Part V Division 2A. DAMAGES – election between damage under negligence and Trade Practices Act – future care principles – 24-hour care required.
LEGISLATION CITED:	Civil Procedure Act 2005 (NSW) Sale of Goods Act 1923 (NSW) Trade Practices Act 1974 (Cth) Uniform Civil Procedure Rules 2005 (NSW)
CASES CITED:	ACCC v Glendale (1998) ATPR 41-632 Arnison v Smith (1889) 41 Ch D 348 Arthur Robinson (Grafton) Pty Ltd v Carter (1968) 122 CLR 649 Atkinson v Hastings Deering (Qld) (1985) 6 FCR 331 Australian Timber Workers Union v Monaro Sawmills (1980) 42 FLR 369 Berrigan Shire Council v Ballerini [2005] VSCA 159 Chulcough v Holly (1968) 41 ALJR 336 Crago v Multiquip (1998) ATPR 41-620 Dessent v Commonwealth (1977) 51 ALJR 482 Donoghue v Stevenson [1932] AC 562 Fabre v Arenales (1992) 27 NSWLR 437 Graham Barclay Oysters Pty Ltd v Ryan; Ryan v Great Lakes Council; State of New South Wales v Ryan (2002) 211 CLR 540 Grant v Australian Knitting Mills (1935) 54 CLR 49 Imperial Furniture Pty Ltd v Automatic Fire Sprinklers Pty Ltd [1967] 1 NSWR 29 Jillawarra Grazing v John Shearer (1984) ATPR 40-441 Jones v Dunkel (1959) 101 CLR 298 Lanza v Codemo [2001] NSWSC 72 Laundess v Laundess (1994) 20 MVR 156 McPherson’s Ltd v Eaton [2005] NSWCA 435 Minchillo v Ford [1995] 2 VR 594 Modbury Triangle v Anzil (2000) 205 CLR 254 Olley v Marlborough Court Ltd [1949] 1 KB 532 Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 Pesl v Ray Smith Tractors [2007] NSWCA 74 Podrebersek v AI&S (1985) 59 ALJR 492 Purkess v Crittenden (1965) 114 CLR 164 SCC v Dell Oro (1974) 132 CLR 97 Sharman v Evans (1977) 138 CLR 563 Stevens v Brodribb Sawmilling (1986) 160 CLR 16 Stevenson Jordan & Harrison v McDonald [1952] 1 TLR 101 Sullivan v Moody (2001) 207 CLR 562 Texcrete Pty Limited v Khavin [2003] NSWCA 337 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 Van Gervan v Fenton (1992) 175 CLR 327 Wyong Shire Council v Shirt (1980) 146 CLR 40
PARTIES:	20076/2002 - P: LAWS, John Rodney D1: GWS Machinery Pty Ltd D2: Motokov Australia Pty Limited (in liquidation) / CGU Insurance Australia Limited D3: LAWS, Thomas John XC: LAWS, Thomas John XD: NRMA Insurance 20084/2002 - P: LAWS, Thomas John D1: GWS Machinery Pty Ltd D2: Motokov Australia Pty Limited (in liquidation) / CGU Insurance Australia Limited
FILE NUMBER(S):	SC 20076/2002; 20084/2002
COUNSEL:	20076/2002 - P: Mr D.A. Wheelahan QC with Mr P.J. Frame D1: Mr S.G. Campbell SC with Mr P.L. Perry D2: Mr R.A. Gray D3: Mr P.J. Doherty SC with Mr Morgan 20084/2002 - P: Mr P.J. Doherty SC with Mr Morgan D1: Mr S.G. Campbell SC with Mr P.L. Perry D2: Mr R.A. Gray
SOLICITORS:	20076/2002 - P: Mr S. Groves (Lamrocks Solicitors) D1: Mr P. Lederman (Moray & Agnew Solicitors) D2: Mr S. Kennedy (Curwoods Lawyers) D3: Mr P. Heath (Somerville & Co) 20084/2002 - P: Mr P. Heath (Somerville & Co) D1: Mr P. Lederman (Moray & Agnew Solicitors) D2: Mr S. Kennedy (Curwoods Lawyers)