The State of Tasmania v MFC

[2021] HCATrans 167

[2021] HCATrans 167

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Hobart  No H6 of 2021

B e t w e e n -

THE STATE OF TASMANIA

Applicant

and

MFC

Respondent

Application for special leave to appeal

KEANE J
GORDON J
EDELMAN J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA BY VIDEO CONNECTION TO BRISBANE AND MELBOURNE

ON FRIDAY, 15 OCTOBER 2021, AT 12.30 PM

Copyright in the High Court of Australia

KEANE J:   In accordance with the Court’s protocol when sitting remotely, I will announce the appearances for the parties.

MR M.E. O’FARRELL, SC, Solicitor‑General for the State of Tasmania, appears with MS S.D. ELANKOVAN for the applicant.  (instructed by the Office of the Solicitor‑General of Tasmania)

MR H.M. HEUZENROEDER appears for the respondent.  (instructed by S+P Lawyers)

KEANE J:   Yes, Mr O’ Farrell.

MR O’FARRELL:   May it please the Court.  On this application, it is contended first that the Full Court was in error, and secondly that the case provides this Court with a suitable vehicle with which to resolve some issues that have arisen in intermediate courts from the majority judgment in Northern Territory v Mengel, and also to consider the novel duty proposed by the respondent as an exception to the principle in Sullivan v Moody in negligence.

The issues of error and suitable vehicle are overlapping.  The content of the tort of misfeasance in a public office and the formulation of the duty of care in negligence each involve matters of law that can be tested against the plaintiff’s amended statement of claim, which is the subject of the interlocutory application in this case to strike a pleading in this proceeding.  Your Honours, so far as that question is concerned, that it is simply an interlocutory proceeding, we submit that questions that may require extensive legal argument should nonetheless be decided as a matter of principle and this ‑ ‑ ‑ 

KEANE J:   That is very well, so far as the application to strike out itself is concerned, but once you seek special leave to come here, do we not need a more secure foundation in terms of the factual basis on which the resolution of these questions of law is to proceed than we have at the moment?  While the matter remains at the pleading stage, pleadings can be amended.  Findings of fact may not be made that conform precisely with the pleadings.  Is there not a problem with whether or not this application to this Court is right?

MR O’FARRELL:   We would submit not, your Honour.  We would submit that the issues – both on the pleadings and so far as they have been articulated in the courts below – are sufficient to ground this particular application, particularly, may I say, in the case of the misfeasance of public office.  The elements of the tort, so far as the case proceeding – if it should proceed – are critical to the way that the Court will deal with the matter.  Those elements of course are strictly matters of law.

The discussion in respect of that, your Honours, centres around the particular passages in Mengel, the way they have been treated in other courts in other jurisdictions, including in the House of Lords in England, and also in the Court of Appeal in New Zealand.  So, in my submission, the question of what elements make up misfeasance in the public office is very much ripe for this Court.

GORDON J:   The difficulty I have, Mr Solicitor, is that, not only is it premature, but it may very well be hypothetical - until we know what Ms Marshall’s evidence is, about what she knew, thought and did, we have no idea whether this cause of action on any view is open.  The question might not arise.  We are therefore asked to think about elements without a factual basis, as Justice Keane put to you – but it may very well be hypothetical.

MR O’FARRELL:   Your Honour, it is not hypothetical insofar as the case has been advanced below that there is – so far as misfeasance is concerned at least – I will come to negligence in due course – but so far as misfeasance is concerned, the Full Court, in line with Justice Estcourt and also the Associate Justice, say that as a matter of law at least it is arguable that there is something called negligence which arises in circumstances of good faith.  We would submit that that proposition as a matter of law is simply not tenable, and that - - -

EDELMAN J:   Mr Solicitor, none of that may arise depending upon the manner in which, at trial, the primary ground for targeted malice as pleaded is dealt with and that has just not been addressed in any of the courts yet, has it?  The primary ground is the ground relating to improper purpose and improperly biased disposition.  We are only here dealing with the alternative pleading.

MR O’FARRELL:   Well, your Honour, the difficulty with the case as pleaded, particularly with targeted malice, if I can deal with that, is that it runs headlong into section 111 of the Children, Young Persons and Their Families Act, which effectively only permits Ms Marshall to – for her liability to be relieved if she has acted in good faith.  Of course, targeted malice involves - must involve bad faith.  We would say the whole of the tort must involve bad faith, and that is the very antithesis of good faith.

Now, in this case, of course, we say that the plaintiff or the respondent here has simply sued the wrong defendant.  The public officer, as pleaded, is Ms Marshall.  The tort is her personal tort, so far as she has abused or exceeded her powers, and in order to make it good, they have to establish that the tort was committed in bad faith.  Now, all those things ‑ ‑ ‑ 

EDELMAN J:   Is that right, Mr Solicitor?  There seems to have been an assumption that Ms Marshall was a delegate, and not an agent.  Why was she not acting as an agent?

MR O’FARRELL:   Well, whether she was acting, your Honour, as a delegate or an agent does not really solve the elemental problem of the pleading.  If she was a public officer, that is, the Secretary’s delegate and/or an agent, your Honour, we would submit that she is caught by section 11.  If she is not, if she was acting on a frolic of her own, for example, then the vital element of public officer is missing from the tort.

So, in that case, section 111 would have no application because she is not relevantly engaged in the administration of the Act, and that would make her a stranger, so that the only way that liability could attach in that case would be via negligence.  That then brings into sharp relief the alternative action in Sullivan v Moody for negligence. 

Even if it could be said, as we understand our learned friend to put as part of his reply, that she was acting with de facto authority, the State would still not be liable because the relevant power in section 18 of the Children, Young Persons and Their Families Act is not vested in the State.  It is vested very firmly in the Secretary, and that power, we submit, is power which is originally invested in the Secretary.      So, on no view of the matter could she be acting within the scope of her employment. 

We submit that at this stage of the case, it is very much a question of whether or not the elements could ever be satisfied for the tort of misfeasance in a public office. 

Your Honours, so far as that goes – again I am conscious not to waste too much time on this point – the heart of this, and with the greatest of respect to the majority in Mengel, if I could refer your Honours to the application book at pages 30 to 32 and you will see there that Acting Justice Martin set out the relevant passages from Mengel.  At page  31, towards the bottom, you will see there is an italicised passage.  We refer to that and also to the sentence immediately above that.  As the discussion goes over to 32, it can be seen at paragraph 23 that Acting Justice Martin agreed with Justice Estcourt about leaving open:

the possibility that a public officer, albeit in a misguided way, who has engaged in reckless conduct but has been motivated by considerations of public benefit, rather than personal gain or vindictiveness -

In our submission, that sets up a proposition which is at the very antithesis of the tort of misfeasance.  The principal difficulty arises in respect of the passages from Mengel that Acting Justice Martin relied on, and those passages are the very same passages that caused the tension which can be identified in the authorities of South Australia v Lampard‑Trevorrow [2010] 106 SASR 331, and more recently Obeid v Lockley (2018) 98 NSWLR 258.

We submit that the explanation of the tort in Obeid v Lockley is a very compelling one and we cannot really improve on that, but the reasoning of the court turns on what it identifies as the assumption in Mengel which is set out in the last sentence of the paragraph immediately above the italicised paragraph that I have referred your Honours to, that it was for present purposes that it could be accepted that foreseeability of harm was an element.

Whether foreseeability of harm is pleaded in this case, or not ‑ and I do not read the pleading as actually pleading foreseeability of harm – the Full Court’s reliance on the italicised passage took it even further beyond the recognisable parameters of the tort when it proposed that, rather than focusing on the two elements, namely, knowledge of lack of power and intention to cause harm, it simply proposed that it was arguable that a person, when acting in good faith, could act recklessly.

We say that the common thread in these cases is really that dicta from the majority judgment in Mengel and we would strictly adopt what Justice Leeming said in the New South Wales Court of Appeal in Obeid v Lockley at page 307:

It is easy to see how confusion could arise.

Now, your Honours, as we have pointed out, Mengel has been considered in Garrett v  Attorney‑General [1997] 2 NZLR at 347, and also the Court of Appeal and the House of Lords in Three Rivers DC v Governor of The Bank of England (No 3) [2003] 2 AC 1, and also by the Canadian Supreme Court in Odhavji v Woodhouse [2003] 3 SCR 263.

The settled formulation of the mental element in each of those cases involves either an intention to cause an injury to the plaintiff, which is of course targeted malice or the knowledge of the lack of power and that the act is likely to cause injury.  Knowledge in this sense includes recklessness – reckless indifference, should I say, as to whether there is power – or reckless indifference as to whether there is a likelihood of injury.  But, in none of those formulations, your Honours, is it postulated – and nor could it be, we submit – that there could be an act or omission done for the purposes of a tort of misfeasance in good faith.  It simply will not arise. 

Now, your Honours, so far as the other aspect of the case of misfeasance goes, which is the independent discretion laws, we submit that the tort must be committed by a public officer, which is of course pleaded by the respondent in this case.  If it is committed by a public officer, that is Ms Marshall, then the independent discretion will operate because the authority is vested in her as either delegate or agent of the Secretary, and the State is therefore not vicariously liable for her action.  Your Honours, I have already referred to an extension of that argument in answer to the questions from Justice Edelman. 

So far as Sullivan v Moody is concerned, your Honours, the respondent attempts to distinguish the principle in Sullivan v Moody on a number of grounds, but without really addressing the principle for which it stands.  At the core of the respondent’s case, your Honours, is this notion that because the State owed a separate duty to the foster children in the care of the respondent, it owed what is referred to as a piggy‑back duty to the respondent himself. 

Now, we have identified at paragraphs 34 to 37 of the special leave application a number of problems with that reasoning, and if I can just extrapolate one of those points a little further, as is pointed out at paragraph 32.  Without the other children involved in this case, the duty on the basis of Sullivan v Moody would simply not exist.  So, a negligent finding against a single foster parent would result in no cause of action, whereas in the case of the respondent, it is said that the clause reflects in a breach of duty to the children. 

Stated in that way, your Honours, we would submit that it can be seen that the formulation of the duty is constructed from the consequences of the breach.  Principle, however, requires that - we say it requires the starting point of the inquiry into the duty to meet its statutory powers and functions reposed in the relevant authority.

So, the formulation of the respondent’s duty does not relate to the risk to the child in relation to the conduct prescribed by the Act, that is, the risk of abuse or neglect to a particular child.  Instead it proposes a duty to the other children in respect of whom there is no such risk by hypothesis.  The duty is constructed from the point of view of the consequences of the actions of the statutory authority and not whether the duty is available in the first place.  So, like Sullivan v Moody, it starts from the proposition that there might be foreseeable harm, but of course foreseeability is simply not enough.

We would submit, your Honours, that consistent with the principle of Sullivan v Moody, Ms Marshall was required to investigate the allegation to protect the child.  That denies the existence of the duty for which the respondent contends, or any other duty that is inconsistent with the powers and functions she was required to exercise under the Act.  We refer in particular to paragraph 60 of the judgment in Sullivan v Moody.  In respect of the other reasons, our other reasons for attacking the case in respect of negligence, we simply rely on paragraphs 34 to 37 of the application.  If your Honours please.

KEANE J:   Thanks, Mr Solicitor.  The Court will adjourn briefly to consider the course it will take in this matter. 

AT 12.50 PM SHORT ADJOURNMENT

UPON RESUMING AT 12.53 PM:

KEANE J:   The appeal proposed by this application is not a suitable vehicle for the resolution of the issues sought to be agitated by the applicant.  The application is dismissed with costs.

Adjourn the Court.

AT 12.54 PM THE MATTER WAS CONCLUDED