[This headnote is not to be read as part of the judgment]
On 20 August 2004, the appellant’s partner, Ms Paterson, was fatally injured when the car she was driving ran off the road and hit a tree. At the time of the accident, the respondent, Harden Shire Council, was carrying out roadworks on the section of road where the accident occurred.
The appellant brought proceedings for damages for psychiatric injury arising from Ms Paterson’s death, and, on behalf of himself and her children, for damages under the Compensation to Relatives Act 1897 (NSW). The appellant claimed that the accident was caused by loose gravel on the road surface, and that the respondent was negligent in failing to provide adequate signage to indicate that the road had been resurfaced and that motorists should reduce their speed.
The primary judge, Fullerton J, dismissed both claims:  NSWSC 757. Her Honour found that the Council had breached its duty of care to Ms Paterson in failing to erect adequate signage. However, her Honour was not persuaded that this breach was the cause of Ms Paterson’s accident. Her Honour also considered that the appellant did not establish a breach of duty to the standard required by the Civil Liability Act 2002 (NSW), s 43A. This section states that a public authority exercising (or failing to exercise) a special statutory power, within the meaning of that section, will not be liable unless the act or omission was in the circumstances so unreasonable that no authority having the special statutory power could properly consider the act or omission to be a reasonable exercise of, or failure to exercise, its power.
On appeal to this Court, the appellant claimed that:
(1) The primary judge erred in holding that the statutory defence provided by the Civil Liability Act, s 43A, applied to the circumstances of the case, and that the appellant had not established a breach of duty to the standard required by that section;
(2) The primary judge erred in requiring the appellant to establish causation on a standard of proof that was higher than the balance of probabilities;
(3) The primary judge erred in failing to find that the accident was caused by the Council’s negligence: Civil Liability Act, s 5D.
The Court allowed the appeal.
In relation to (1):
(Basten JA, Bathurst CJ and Beazley P agreeing)
1. Section 43A is engaged as the failure to provide adequate signage on the road involved the exercise of a special statutory power – the signs were a “prescribed traffic control device” under the Road Transport (Safety and Traffic Management) Act 1999 (NSW) which can only be installed by a public authority: - (Basten JA)
Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd  NSWCA 263; 77 NSWLR 360; Bellingen Shire Council v Colavon Pty Ltd  NSWCA 34; 188 LGERA 169 distinguished.
(Bathurst CJ, Beazley P and Basten JA)
2. The standard of liability once s 43A is engaged requires determining whether no authority could properly consider the act or omission to be a reasonable exercise of, or failure to exercise, its power. The emphasis is on what a public authority exercising that statutory power could properly consider reasonable – not what the court considers reasonable:  (Bathurst CJ);  (Beazley P); - (Basten JA)
(Bathurst CJ, Beazley P and Basten JA)
3. The expert evidence established that the failure to include signage indicating that the road was slippery and that motorists should reduce their speed was a decision no body with the special statutory powers in question could reasonably have made in these circumstances:  (Bathurst CJ); - (Beazley P); - (Basten JA)
In relation to (2):
(Bathurst CJ, Basten JA)
1. No appealable error is disclosed in how the trial judge approached the issue of causation:  (Bathurst CJ),  (Basten JA).
2. The comparison of probabilities with possibilities, the former satisfying the standard of proof while the latter do not, is entirely conventional and does not demonstrate a misunderstanding of the applicable burden of proof: -
Nguyen v Cosmopolitan Homes  NSWCA 246; Sydney South West Area Health Service v Stamoulis  NSWCA 153 approved.
3. The standard of proof of facts in respect of which a party bears the onus of proof requires the fact finder to compare the probability of the event having occurred against the probability that it did not occur: -
Malec v JC Hutton Pty Ltd  HCA 20; 169 CLR 638; Briginshaw v Briginshaw  HCA 34; 60 CLR 336
(Beazley P, dissenting)
4. The trial judge erred in holding that, to establish causation, the appellant was required to prove that the probability that the accident was caused by the respondent’s breach was greater than the possibility that it was caused by hypothetical alternatives unrelated to the respondent’s breach. This posed a wrong comparison for determining whether a fact has been established on the balance of probabilities: -
Bradshaw v McEwans Pty Ltd  HCA 480; 217 ALR 1; Nguyen v Cosmopolitan Homes (NSW) Pty Ltd  NSWCA 246 disapproved
In relation to (3):
1. A finding on causation can be made by the drawing of available inferences, provided that the relevant standard of proof is satisfied: 
Betts v Whittingslowe  HCA 31; 71 CLR 637; Roads and Traffic Authority v Royal  HCA 19; 82 ALJR 870
(Bathurst CJ, Beazley P)
2. Having regard to the evidence, the trial judge erred in finding that causation was not established on the balance of probabilities: - (Bathurst CJ),  (Beazley P)
(Basten JA, dissenting)
3. The trial judge was entitled on the evidence to find that causation had not been established: , 
David Cormack – Brisbane Barrister & Mediator