CLA: contributory negligence and actual knowledge

Origin Energy LPG Ltd v BestCare Foods Ltd [2012] NSWCA 407

I refer you to the discussion on the analogue to s.23 of the Civil Liability Act 2003 (Qld) regarding contributory negligence and knowledge.

Macfarlan JA at [1]
Hoeben JA at [2]
Ward JA at [221]

209.

As indicated, the appellants only relied upon one particular of contributory negligence, i.e. that the plaintiffs failed in their common law duty to isolate the storage tank when the factory was closed down and left unattended on 24 January 2003.

210.

Section 5R of the Civil Liability Act 2002 (CLA) applies:

“(1) The principles that are applicable in determining whether a person has been negligent also apply in determining whether the person who suffered harm has been contributorily negligent in failing to take precautions against the risk of that harm.

(2) For that purpose:

(a) the standard of care required of the person who suffered harm is that of a reasonable person in the position of that person, and

(b) the matter is to be determined on the basis of what that person knew or ought to have known at the time.”

211.

It was common ground that the tank isolation valve was not closed when the site was unattended on 24 January 2003. Mr Heness was the factory manager. His evidence was that there was never a requirement to close the isolation valve at the tank and that the respondent had never done so. Under cross-examination he agreed that if required, it could have been done but it would delay start up and be impractical. He agreed that there was nothing to stop the respondents isolating the gas tank had they wanted to on 24 January 2003 (T.186).

212.

Mr Goldring was a director of each of the respondents. It was his evidence that gas was turned off at the individual appliances, but not at the gas tank. His evidence at the coronial inquiry, which he confirmed at trial, was:

“Q. Did anyone turn off the gas supply then?

A. No.

Q. That you know of?

A. No, not to my knowledge, no. It wasn’t a regular practice, sorry. We certainly turned the gas off at the appliances otherwise gas would continue to leak into the plant. But there, there wasn’t a standard practice to turn off the gas at the tank, in fact the tank was out of bounds to our people.” (T.629.38)

213.

Other evidence given by Mr Goldring was:

“Q. But that risk could have been avoided, couldn’t it, if you had a procedure to turn the gas off at the tank, isn’t that right?

A. I don’t know about that, I wasn’t aware of any need to turn the gas off at the tank.

Q. Mr Goldring, common sense would tell you that if you are not going to be in the factory for a couple of days and you have a 43,000 litre gas tank, the proper procedure would be to turn the gas off at the tank, wouldn’t you agree?

A. No, I don’t agree. I considered it really to be like electricity or water. You don’t turn those off at the mains when you leave the factory.

Q. So you see 43,000 litres of gas in much the same way as water?

A. Or electricity, yes. They are utilities.

Q. But if you light 43 gallons of water it won’t blow up, will it?

A. No, it can leak into the factory and cause problems. Light power electricity can cause major problems as well.” (T.630.41-631.7)

“Q. You see Mr Goldring, you didn’t shut down the tank or isolate it when you were shutting down the factory because it caused a problem in starting up, isn’t that the reason?

A. I think that’s something that was passed onto me from the factory manager, he talked about that. I wasn’t familiar with that.

Q. Do you agree with me?

A. I don’t really know, that’s information I was given by the factory manager at some stage.

Q. You don’t really know?

A. No, I don’t know. I didn’t have experience. The other factories I worked at we carried out the same sort of philosophy, we never shut down the tank.” (T.633.37-48)

214.

His Honour resolved the question of contributory negligence at [317] – [321] (see [75] hereof). Not only did his Honour find as a fact that neither Mr Heness nor Mr Goldring, nor anyone else in the respondents’ employ, was aware of a requirement under the Australian Standard to isolate the gas tank when the factory was unattended, he found that no-one from the appellants had provided that information to them. His Honour found that the likely explanation was that under the contract between Origin and BestCare the responsibility for keeping the equipment safe was undertaken by Origin.

215.

The appellants submitted that the primary judge erred in his approach to contributory negligence in that he focused on the actual knowledge of the respondents, rather than upon what a reasonable person in the position of the respondents would have done in relation to the isolation of the tank. In other words, his Honour had not addressed the correct legal question. The appellants submitted that had his Honour done so, he would have concluded that, because of the inherently dangerous nature of the installation, a reasonable factory operator in the position of the respondents would have isolated the tank. This was particularly so when all that was required to do so was the closing of an isolation valve.

216.

As the terms of s 5R(2)(b) CLA make clear, actual knowledge has a part to play in the assessment of contributory negligence. The combination of the statutory requirement and of the common law was considered in Council of the City of Greater Taree v Wells [2010] NSWCA 147; 174 LGERA 208 where Basten JA said:

“107 The assessment of the plaintiff’s conduct involves a quite different exercise. A critical difference between the assessment of negligence and the assessment of contributory negligence is that the purpose of the latter assessment is to allow for an apportionment of responsibility for the injury by a reduction in the damages recoverable by the plaintiff “to such extent as the Court thinks just and equitable having regard to the claimant’s share in the responsibility for the damage”: Law Reform (Miscellaneous Provisions) Act 1965 (NSW), s 9(1). That is a different exercise from the determination of whether or not the defendant has been negligent.

108 A further important difference in approach in assessing the negligence of the defendant, as against the contributory negligence of the respondent, involves the degree of precision by which the activity, including relevant states of knowledge and understanding, is to be identified. … With respect to the plaintiff, the focus of the evidence is often quite different. Although the ultimate question is what a reasonable person in [the plaintiff’s] position would have known and done, it is inevitable that the evidence will focus upon the knowledge, understanding and actions of the plaintiff himself, shortly prior to the accident, in part to determine whether he exercised reasonable care, but also to assess what would be reasonable care in the specific circumstances.”

217.

As s 5R and that extract from the judgment of Basten JA in Wells indicate, the correct legal question is whether a reasonable person in the position of the respondents, i.e. having the knowledge which the respondents had or ought to have had, was negligent. In this case, the factual finding of his Honour was that the respondents did not have actual knowledge of the need to isolate the tank. The only inquiry is whether they ought to have had such knowledge.

218.

There was no expert or other evidence as to what persons operating a factory such as this should have done with respect to isolating a gas tank. There was an Australian Standard but it had only come into effect in 2002 and only applied to installations which commenced operation after 10 May 2002. The only evidence as to a general practice came from Mr Golding when he said:

“The other factories I worked out we carried out the same sort of philosophy, we never shut down the tank.”

Neither that evidence nor any other evidence supported the proposition that the respondents ought to have known that the tank should have been isolated during a shut down.

219.

On that state of the evidence, I am not satisfied that a reasonable person with the knowledge of the respondents, and in their position, would have isolated the tank before the shut down on 24 January 2003. This is particularly so when Origin, the entity responsible for the safe operation of the installation, had not provided any information or advice to that effect. His Honour was correct to reject the appellants’ defence of contributory negligence.

 

Brisbane Barrister – David Cormack

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