General Insurance Case Note: Wicks v SRA; Sheehan v SRA

Rescuers: a new statutory class of persons who can recover damages for pure mental harm?

Wicks v State Rail Authority of New South Wales; Sheehan v State Rail Authority of New South Wales [2010] HCA 22 (16 June 2010)

On 16 June 2010, the Full Court of the High Court of Australia considered the question of the entitlement of rescuers who come across the aftermath of an accident to damages, in light of the mental harm provisions of the Civil Liability Act 2002 (NSW).

Factual background

The two actions arose out of the renowned train derailment near Waterfall Station on 31 January 2003, in which 7 people died. The appellants (Mr Wicks and Mr Sheehan) were members of the NSW Police Force at the time of the accident and were among the first to arrive at the scene.

At first instance, both police officers gave graphic accounts to the Court as to the horrific nature of the scene with which they were confronted when they arrived at the scene. This included coming across numerous deceased and dismembered bodies, assisting with the extraction of survivors from the wreckage (some with severe injuries), providing first aid assistance, ensuring that the scene was secure and reassuring survivors who were extremely distressed.

Both officers commenced proceedings against the State Rail Authority of NSW (“SRA”), alleging that the negligence of the SRA had caused them to suffer pure mental harm. The SRA admitted that it was negligent in the operation of the railway and of the particular train that derailed, but the central question in each appeal was whether the SRA was liable for damages in respect of pure mental harm.

Legislative provisions

A determination of these issues turned on the construction of the mental harm provisions in Part 3 of the Civil Liability Act 2002 (NSW), and in particular section 30.

Section 30 of the Civil Liability Act 2002 (NSW) provides:

“(1) This section applies to the liability of a person (the defendant) for pure mental harm to a person (the plaintiff) arising wholly or partly from mental or nervous shock in connection with another person (the victim) being killed, injured or put in peril by the act or omission of the defendant.

(2) The plaintiff is not entitled to recover damages for pure mental harm unless:

Lower courts

Malpass AsJ at first instance concluded that neither Mr Wicks nor Mr Sheehan witnessed a victim or victims or the derailment “being killed, injured or put in peril” as was required under s30(2)(a), because they had been present only during the aftermath of the accident.

The decision of Malpass AsJ was upheld by the Court of Appeal (Beazley JA and Giles JA agreeing, McColl JA dissenting). Given the claims did not satisfy the provisions of s30(2)(a), neither Malpass AsJ nor the Court of Appeal addressed the issue of whether the SRA owed the officers a duty of care.

High Court decision

Despite the approach taken by the lower courts, the High Court was of the view that an examination of the provisions relating to duty of care was necessary to avoid reading the limitation under s30(2)(a) out of its statutory context.

Section 32 of the Civil Liability Act 2002 (NSW) addresses the issue of duty of care for mental harm and provides:

“(1) A person (the defendant) does not owe a duty of care to another person (the plaintiff) to take care not to cause the plaintiff mental harm unless the defendant ought to have foreseen that a person of normal fortitude might, in the circumstances of the case, suffer a recognised psychiatric illness if reasonable care were not taken.

(2) For the purposes of the application of this section in respect of pure mental harm, the circumstances of the case include the following:

Consistent with the decision in Tame v New South Wales[1], the Court was of the view that the central determinant of a duty of care was foreseeability, however, the “circumstances of the case” identified at section 32(2), were relevant to the question of foreseeability, however, were not pre-conditions to establishing a duty of care.

Although the Court noted that s30 will only be enlivened where a relevant duty of care is found to exist and it would therefore ordinarily be desirable to begin by determining whether the SRA owed the appellants a relevant duty of care, both parties had submitted that the Court should not decide the issue of duty of care. Accordingly, the issue of a duty of care was to be remitted for consideration by the Court of Appeal.

Nevertheless, the Court was required to consider the question of whether the limitation in s30(2) was overcome in the event that a duty of care was established.

The first limb of that section required the officers to satisfy the court that the claims arose “wholly or partly from mental or nervous shock in connection with another person … being killed, injured or put in peril” by the negligence of the SRA.

The Court interpreted the term “shock” broadly and noted it should not be confined to the shock each rescuer suffered which he or she perceived on first arriving at the scene, but should extend to the series of shocking experiences to which each appellant was exposed at the scene. On that basis, the Court determined that the officers’ claims could be said to arise “wholly or partly from (a series of) mental or nervous shock(s).”[2]

The next issue for the Court was whether the appellants had “witnessed, at the scene, the victim(s) being killed, injured or put in peril”, so as to satisfy the limitation in s30(2)(a).

Although s30(2)(a) required the plaintiff to “witness” the event, the Court noted that it was incorrect to assume that all cases of death, injury or being put in peril are events that have a discernible start and finish. The Court conceded that although there are some cases to which that interpretation would apply, there are also cases where death, injury or being put in peril take place over an extended period, and this scene was one such case.

Despite the fact that some aboard the train were killed instantly as a result of the derailment, the Court considered that the consequences of the accident took time to play out, not all of the injuries sustained were suffered during the process of derailment and the perils to which the surviving passengers were subjected did not end when the carriages came to rest. The Court determined that a person is put in peril when put at risk and that person remains in peril until they cease to be at risk. In this case, the survivors of the derailment remained in peril until they had been rescued by being taken to a place of safety. The Court noted that the agreed description between the parties of each of the officers as a “rescuer” necessarily implied this. Accordingly, the appellants witnessed, at the scene, victims of the accident being put in peril as a result of the negligence of the State Rail Authority and satisfied the limitation under s30(2)(a).

In the circumstances, the appeals were allowed and each matter was remitted to the Court of Appeal for its further consideration of the issues of duty of care and whether each appellant suffered a recognised psychiatric injury.

Comment

This decision clarifies the position of rescuers who come across the aftermath of an accident as far as their entitlement to claim damages for pure mental harm is concerned. It potentially increases insurers’ exposure to claims, with notable risks in the health and emergency services fields, as well as in relation to motor vehicle accidents.

Whilst the determination appears to broaden the statutory class of persons who are entitled to claim damages for pure mental harm, caution should be exercised when considering the question of liability. In this regard, the High Court noted that there will be circumstances in which the limitation under s30(2)(a) could still apply. Accordingly, the factual matrix of each matter should be considered carefully to ensure that a rescuer has satisfied the legislative provisions.

It is worth noting that although the High Court did not specifically determine the issue of whether a duty of care existed, the Court’s examination of s32 suggests that the section should be interpreted broadly, and that the ‘circumstances of the case’ outlined at s32(2) are not pre-conditions to a duty of care being established.