Testing the limits of statutory defences - part two: Bankstown City Council and Roads and Maritime Services appeal primary decision – Bankstown City Council v Zraika; Roads and Maritime Services v Zraika [2016] NSWCA 51

This is an appeal by two statutory authorities of the decision handed down by the Supreme Court of New South Wales in Zraika v Walsh [2015] NSWSC 485. In that decision, Roads and Maritime Services (RMS) and Bankstown City Council (BCC) were found liable to pay part of the damages suffered by the plaintiff in relation to a motor vehicle accident because they failed to properly design or manage dangers that emerged at a traffic intersection.

RMS and BCC each filed separate appeals challenging the primary decision that they were each liable for 25% of the damages. They also challenged the primary decision that the plaintiff's father had not breached his duty of care and that this breach was not causative of the collision.

For convenience, the facts of the matter are as follows:

The plaintiff was in utero at the time of the accident (16 November 2002). His mother was a passenger in a motor vehicle driven by his father. The vehicle was involved in a collision at a set of traffic lights, with another vehicle driven by Mrs Walsh. With varying accounts of the events of the day, including multiple lay and expert witnesses, the tribunal of fact determined:

Liability of Ali Zraika (the plaintiff's father)

The New South Wales Court of Appeal (Court of Appeal) found that the trial judge's reasoning that the plaintiff's father did not breach his duty of care to the plaintiff could not stand. This is because it was reasonably foreseeable and a not insignificant risk that an obstruction existed within the intersection the plaintiff's father was entering (despite it not being visible).² Further, a reasonable person in the position of the plaintiff's father would not have changed lanes into lane one at 65km per hour through an intersection with such a risk.³ In addition, the plaintiff's father entered the intersection unlawfully and despite the trial judge's reliance on the line of authority discussed in Henderson v Hassel⁴, that such rule-breaking is not always consonant with negligence, that line of authority had limited relevance in these circumstances.⁵

The trial judge's decision that the plaintiff's father did not breach his duty was set aside.

In relation to causation, the trial judge found that there was no way, even in reasonable circumstances, that the plaintiff's father could have avoided a collision. Accordingly, his actions could not be a necessary condition of the plaintiff's harm.⁶ However, the Court of Appeal highlighted that the ambit of the liability-only hearing was to determine whether a collision could have been avoided, rather than could the 'harm' have been avoided. Accordingly, the trial judge had erred by taking the evidence about the inevitability of a collision as answering the question of causation in relation to the damages suffered by the plaintiff.⁷

The trial judge's decision on causation relating to the plaintiff's father's conduct was set aside.

Apportionment of liability to pay damages between the plaintiff's father and Mrs Walsh

In accordance with s 5(2) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW), the Court of Appeal found that when comparing the breaches between the plaintiff's father and Mrs Walsh, the former was substantially more culpable than the latter because:

• He was familiar with the road and the requirement to turn left from lane one
  
  
• He proceeded not knowing whether the intersection was obstructed
  
  
• His speed was too great given his unlawful entry into the intersection.

In contrast, Mrs Walsh entered the intersection giving way to other vehicles and during a traffic lighting phase that stopped vehicles travelling perpendicularly to her entry point. Additionally, she entered the intersection lawfully whereas the plaintiff's father did not.

The Court of Appeal apportioned the liability to pay damages in the order of 60% for the plaintiff's father and a 40% for Mrs Walsh.

Liability of BCC

The trial judge found BCC negligent by failing to impose a left-turn only condition on traffic exiting from the factory complex, which Mrs Walsh exited on the day of the accident, in the original development consent granted in 1997.

The Court of Appeal did not deal with the question of whether BCC owed a duty of care to road users in the exercise of its statutory duty. Rather, for simplicity, the Court of Appeal focused on whether the altered standard of care imposed by s 43A of the CLA, in circumstances of the exercise of a special statutory power (the parties agreed that a special statutory power had been exercised), was surmounted.

Section 43A(3) confers a qualified immunity upon a defendant in the form of an adjusted standard of care.⁸ It is formulated as follows:

An analysis of the evidence⁹ found that it fell short of satisfying the statutory test.¹⁰ First, the Court of Appeal believed the trial judge had diluted the statutory test by not properly stating and applying it to the BCC. Secondly, the trial judge did not consider all the evidence. Thirdly, his finding on the requirements that should have been imposed went beyond what was agreed by the experts. Finally, he gave too much weight to evidence from the experts that were given in hindsight rather than assessing whether the conduct of the statutory authority was so unreasonable that no authority at the time could consider it a reasonable exercise of its power.

Accordingly, the finding of breach of the statutory duty by the BCC was set aside.

Liability of RMS

RMS accepted that it owed a duty of care to road users when exercising its special statutory power.

In relation to breach of duty of care, the trial judge's factual finding was that the RMS decided to erect new signage at the factory complex exit in July 2002 as a result of an investigation following a complaint by a local resident. The signage was then erected in December 2002, following the accident in November of the same year. His Honour reasoned that RMS was required to act on the investigations 'within a few weeks' and by not doing so, had breached the s 43A standard.

The Court of Appeal, however, found that there was no evidence to support the conclusion that a recommendation to erect signage was made in July 2002.¹¹ Rather, the decision to erect a sign was prompted by the subject accident; the investigations conducted by the RMS before July 2002 not indicating the necessity of the additional signage.
Accordingly, the factual basis of the trial judge's breach of duty finding fell away.

In relation to whether the BCC owed a duty of care, although this question was not necessary to answer, Gleeson JA (with whom Leeming JA agreed) observed that litigants are required to plead the content of the duty allegedly owed by a statutory authority as to what constitutes reasonable care.¹²

A failure to carefully plead the content of any alleged duty of care by bodies such as a local council and RMS will be fatal to any prospects of recovery or contribution.
The Court of Appeal did not specifically disagree with the trial judge's finding that RMS was required to act 'within a few weeks' as a condition of reasonable exercise of its duty. This suggests that instances of delay by a statutory body in exercising a special statutory power may, in appropriate circumstances, be enough to breach the heightened standard of care imposed by s 43A of the CLA.

This case particularly highlights the importance of timely evidence-gathering and preparation, and presentation of the evidence at hearing. Not only is it difficult to satisfy the standard set out in s 43A but it is made more difficult without all documents relevant to the decision making process. Early investigation of the potential liability of statutory bodies and retaining an appropriate expert is paramount given the long lead times that development projects can have.