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Insurance Update - General Insurance August 2008

Focus: General insurance news
Services: Insurance
Industry Focus: Insurance
Date: 29 August 2008
Author: National Insurance Services Team
Dibbs Abbott Stillman Lawyers restructured on 1 March, 2009.
The Sydney, Brisbane and Canberra offices are now DibbsBarker.

Identification error not a breach of duty

 
When Daniel Cumming (who was then 22 years old) went missing in 2001, his mother Helen notified police the same day. Four days later his body was found in the sea off Sydney. The body was examined at autopsy and the attending doctor concluded that the body was of a person who was 30 – 35 years old. It was not until four years later that police discovered the body was that of Daniel Cumming and notified his family of the death.

The family sued the State of NSW alleging that the police service owed them a duty of care in relation to the investigation of Daniel’s disappearance and death. The State moved to summarily dismiss the claim on the basis that the claimed duty of care did not exist in law.

The matter was heard by Acting Justice Harrison, who reviewed at some length the cases in the area. It was noted that there were a number of considerations to be borne in mind when deciding whether a duty of care arose out of a police investigation.  These were: whether the claimed duty would be to an indeterminate class of people; whether imposing a duty would inhibit the “fearless investigation of criminal activity”; whether there might be a conflict of duties; and whether imposing the duty would involve the court intruding on matters of police policy and discretion including decisions about priorities in the deployment of resources.

In the circumstances of this case, while the claimed duty was not owed to an indeterminate class of persons (it would be owed to the missing persons and their families), it was possible that imposing a duty of care could inhibit investigations of missing persons cases involving “foul play” or criminal activity. In addition, the interest of the missing person might not necessarily be the same as that of their families; and the officers investigating missing persons cases had to make decisions involving a variety of matters of policy and discretion; such as which particular line of inquiry might be most advantageously pursued and what is the most advantageous way to deploy the available resources. It was not contended by the family that this was a case where the police assumed a responsibility. 

Having examined the cases and the relevant factors, Acting Justice Harrison “regrettably” concluded that the family’s argument that the police owed them a duty of care was hopeless. The statement of claim was therefore dismissed.
___________________________________________
Footnote: In the course of argument, Acting Justice Harrison noted that the High Court had granted special leave to appeal from the decision in Kirkland-Veenstra v Stuart [2008] VSCA
32 (recently discussed in this publication). The outcome of that appeal might have implications for any further appeal in this matter.

Cumming v State of NSW [2008] NSWSC 690
 

Expert reliance sometimes misplaced

Many cases in recent times have relied heavily on expert evidence, but putting faith in experts is sometimes misplaced, as a recent case from Queensland illustrates.

One morning in 1999, Jodie Rogers woke to tend to her baby in the early hours of the morning. Having done that, she decided to take some rubbish to the bins located in the unit block where she lived. She went into the hallway and pressed a switch which caused the hallway light to come on. She then walked to the stairs leading to the ground floor. As she was stepping from the first step to the second, the light went out. She gave evidence that gave her a “shock” and she grabbed for the handrail, but fell down the stairs and was injured. She sued the body corporate for the unit block.

The trial judge found that Ms Rogers had not properly depressed the light switch, meaning that the light went out too early, and that had led to the accident. Judgment was entered for the defendant. Ms Rogers appealed to the Court of Appeal. On the appeal, Ms Rogers relied heavily on the expert evidence of Dr Ludcke, an engineer, who found several defects with the stairs.

The defects included a difference in the height of the first and second steps, the fact that the stairs were covered with carpet and therefore difficult to distinguish from one another, and their “nosing” or edge was rounded to a greater extent than recommended.

Ms Rogers did not contest the finding that she had not properly depressed the light switch; but argued that the trial judge should have found that at least the step height difference was a contributing factor to her fall. Delivering the court’s unanimous decision, Justice Holmes noted that Ms Rogers had not suggested that the difference in height was a contributing factor at the time of the accident. While that was not necessarily fatal to her case, there were two reasons why the height difference theory should be rejected.

The first was that it was not intrinsically compelling, as Dr Ludcke had not taken account of Ms Rogers’ familiarity with the stairs. In addition, his evidence had been that the height difference would cause a person’s foot to strike further to the back of the step; which was inconsistent with Ms Rogers’ account of hitting the nosing of the step with her heel. The second was that Ms Rogers herself gave a different, plausible explanation of her fall. Her emphasis on the “shock” of the lights unexpectedly going out made it clear that the sudden darkness was not merely coincidental in her fall. The trial judge had drawn the “obvious inference”: that Ms Rogers missed her footing in a startle response. In those circumstances, there was no reason to resort to the expert’s theory.  

Rogers v Body Corporate for the Waterloo Crest CTS 25235 & Anor [2008] QCA 174
 

Split decision

Assessing apportionments of liability between different tortfeasors is often more art than science. Some of the factors to be considered however have been canvassed in a recent decision from Western Australia.

Fremantle Ports owned a jetty and two cranes used to load and unload cargo ships. It had a contract with Wesfarmers for use of the jetty, and Wesfarmers had contracted with P&O Ports to provide stevedoring services. Under the terms of those arrangements, Fremantle Ports had the responsibility for cleaning up the jetty after use. It contracted that task to a company known as Clean Sweep, and Mr Mills was engaged by Clean Sweep to assist with its cleaning services.

On 17 October 2002, a load of fertiliser had been unloaded from a ship at the jetty. There was a strong northerly wind at the time. When the time came to clean the jetty, it was decided to move the cranes to “pin points” – positions on the jetty where they were secured using metal pins. Attempts to move them were hampered by both the fertiliser (which caused the cranes’ wheels to slip) and the strong wind. The wind was so strong that at one point it pushed a crane some 3 metres past its “pin point”.

Eventually, it was agreed between representatives of both Fremantle Ports and P&O to try to clean the cranes where they were by washing off some of the fertiliser so they could

be moved to the “pin points”. This was partially successful and one crane was secured. The crews from both companies and one crane was secured. The crews from both companies then went on lunch, leaving the other crane unsecured. Mr Mills was told by a Fremantle Ports employee to continue cleaning operations during the lunch break; which he was doing in a vehicle designed for that purpose.

During this time, the wind changed direction from the north to the south-east. This resulted in the second crane being pushed along the jetty. Mr Mills was concentrating on his task and the position of his vehicle and did not notice the moving crane. It collided with his vehicle and he was injured.

At trial, Mr Mills was successful in his claims of negligence against both companies. The trial judge apportioned liability 80% to Fremantle Ports and 20% to P&O. Fremantle appealed against that finding.

By a 2-1 majority, the WA Court of Appeal allowed the appeal. Delivering the reasons for the majority, President Steyler noted that the primary responsibility for cleaning the jetty lay with Fremantle Ports. However, the trial judge had made other crucial findings. These included findings that the Fremantle Ports employees who attended were not authorised to move the cranes and did not know how to do so; that P&O employees had tried to move the cranes and had seen one of them moved by the wind past where they had planned to stop it; and it was reasonably foreseeable by P&O employees that the wind might move a crane that was not pinned down and people would be on the jetty cleaning it when the crane was not pinned down and it was foreseeable by him that a worker could be injured if the crane moved.

More importantly, a P&O employee had failed to tell the Fremantle Ports representative that he could not clean the cranes in the unsecured position. This was found to be “a serious omission” that made a very significant contribution to the accident.  Although Fremantle Ports had overall responsibility for the cleaning operations, the principal responsibility for the operation of the cranes lay with P&O Ports.  In those circumstances, the court found that the P&O employees should have insisted that both cranes have their wheels washed down so they could be secured before the cleaning operations were undertaken. 

Consequently, the finding of 20% liability against P&O Ports was too low. The majority allowed the appeal and apportioned liability 60% to Fremantle Ports and 40% to P&O.

Fremantle Ports -v- P&O Ports Ltd [2008] WASCA 126
 

“Incidents” do not prove negligence

 
In January 2002, Daniel Hughes was out for a motorcycle ride with friends. The group had stopped for a break, at which time Mr Hughes swapped bikes with another of the group. His regular bike was a 250 cc model; but his friend’s bike was a 600 cc model. While riding the larger bike, he came upon a car being driven by Herman Van Eyk. After overtaking the car, he lost control of the motorcycle and was seriously injured.

He sued Mr Van Eyk and the Roads & Traffic Authority of NSW. On the evidence, Justice Hislop found that there had been no negligence on the part of Mr Van Eyk in his driving of his vehicle. He found that Mr Hughes had overtaken at high speed at the end of the overtaking lane, and had lost control of his motorcycle.

Mr Hughes argued that the RTA was liable for his injuries on two bases: firstly, that the road was inadequately signed to give motorists warning of an approaching bend; and secondly that the RTA was on notice of previous incidents on the bend and had done nothing about it.

The signage argument was rejected on the basis of photographic and expert evidence. Justice Hislop then turned to consider the notice argument. Mr Hughes argued that an e-mail sent in October 2001 by one of the RTA’s project managers alerted it to “several incidents” of vehicles losing control on the curve in the road and recommending improvements. It seems the RTA took that advice and the recommended measures were in place by February 2002.

Justice Hislop noted that s.5(c) of the Civil Liability Act provided that taking action which would have avoided a risk of harm did not, of itself, give rise to any liability and did not of itself constitute an admission of liability.

The significance of the reported “incidents” depended on the causes of those incidents; and in this case, the causes were not established by the evidence. The RTA “crash history” noted no reported incidents of vehicles losing control on the curve; although there may have been minor incidents not included in the database.

In any case, the obligation of the RTA, if any, was to take reasonable steps within a reasonable time to address the risk. There was nothing about the e-mail to indicate any particular urgency; and the RTA had not taken a particularly long time to implement the recommended changes. The fact that the proposed work was not completed until after the incident did not (without impermissible hindsight reasoning) show a lack of reasonable care in all the circumstances.

In addition, in the circumstances of the accident as established by the evidence, Mr Hughes had not established that the steps he contended for (which amounted to removing or reducing the overtaking zone) would have prevented the injury in any case.

As a result, Mr Hughes’ claims against both Mr Van Eyk and the RTA were dismissed.

Hughes v Van Eyk & Anor [2008] NSWSC 525
 

Foul stroke

Golf, according to Mark Twain, is a good walk ruined. It’s a sentiment a Queensland doctor might well agree with following a decision of that State’s Supreme Court recently.

Dr Pollard and Mr Trude were both members of the Indooroopilly Golf Club. In November 2004, they were competing in a tournament at the club with two other players. Dr Pollard had played his shot at the 11th hole of day, and had seen it disappear into a grove of trees. He went off to find the ball. He located it fairly quickly but had to wait because a group ahead had to clear the green. At that point, he was about 80m ahead of, and to the left of, Mr Trude when the latter approached his ball to play it after the other group had cleared the green. Mr Trude hit his shot, but it skewed to the left and glanced off one of the trees in the grove where Dr Pollard was standing and struck him in the head.

Dr Pollard sued, alleging that Mr Trude was negligent by taking his shot while he was in front and in range of him; and failing to give an adequate warning.

Justice Chesterman noted that the rules of golf ordinarily required that shots not be taken while players were ahead and in range. In this instance however, the tournament rules had been altered to provide:

“... Players should without delay, play all shots when they are ready and it is safe to do so irrespective of which player is furthest from the hole.”

Dr Pollard therefore expected that Mr Trude would take his shot, even though he was in front and in range. It was also relevant that both players were proficient and had low handicaps. There was no expectation of danger from Mr Trude playing his shot, as he was aiming for the green, which was significantly to the right of where Dr Pollard was standing.

In those circumstances, Justice Chesterman found it was not negligent for Mr Trude to take his shot. That left the issue of the warning. Dr Pollard argued that Mr Trude should have called “Fore” before playing his shot. Justice Chesterman found that Mr Trude’s failure to give the warning was not a breach of his duty of care for a number of reasons. The evidence was that it was common practice among competent golfers not to give a warning unless the player in front had moved into a “dangerous position”. In this case, Dr Pollard’s position could not be considered to be one of those. In addition, Dr Pollard had gone ahead of Mr Trude and expected him to take his shot – indeed, knew that he was going to take it. He knew the green had cleared and was waiting for Mr Trude to hit. Further, Mr Trude was a proficient golfer; there were a number of substantial trees behind which Dr Pollard could shelter; and Mr Trude took his shot when the plaintiff was not in sight.

Justice Chesterman also found that, by reference to s.15 of the Civil Liability Act, the risk of being hit by a golf ball must have been “obvious” within the meaning of the Act; such that a warning was unnecessary. Finally, Justice Chesterman was not prepared to find that, even if a warning had been given, it would have prevented the injury from occurring.

Accordingly, there was judgment in favour of Mr Trude.

Note: An appeal has been lodged against this decision.

Pollard v Trude [2008] QSC 119


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