Questions of liability and apportionment – Court of Appeal decides that statutory immunity prevents proportionate liability finding against concurrent wrongdoer

03 June 2021

In the recent New South Wales Court of Appeal decision of Woodhouse v Fitzgerald, the Court discusses the application of the proportionate liability regime under Civil Liability Act 2002 (NSW) in the context of the conduct of the Rural Fire Service whose officers are subject to a statutory immunity while also exploring the non-delegable duty of care of a landowner to an adjoining landowner.

In Issue

  • The application of the proportionate liability regime under Civil Liability Act 2002 (NSW) (Civil Liability Act) in the context of the conduct of the Rural Fire Service whose officers are subject to a statutory immunity.

The background

The appellant, Mr Woodhouse was the owner of a property in southern New South Wales known as “Myack”, and the respondents, Mr Fitzgerald and McCoy, were the owners of an adjourning property known as “Doran”. On 20 and 28 August 2012, the respondents arranged for the Rural Fire Service (RFS) to conduct a controlled burn to destroy weeds on Doran. On 5 September 2012, the undetected burning roots of an old snow gum on Doran was reignited by strong winds, causing a fire to spread on Myack and causing extensive damage and the destruction of the appellant’s homestead (fire). Mr Woodhouse brought proceedings against the respondents in negligence and nuisance seeking damages for the harm caused by the fire.

The decision at trial

The trial judge in the Supreme Court found that the escape of fire from Doran was caused by the negligence of the RFS, however the RFS was protected by a statutory immunity. Nevertheless, it found that the respondents owed a non-delegable duty to the appellant, which required them to ensure that the RFS exercised reasonable care, even if the RFS itself would have no liability in negligence to the appellant. The respondents were found liable in both negligence and nuisance however loss was apportioned between the respondents (35%) and the RFS (55%) (albeit the RFS’ liability was not recoverable). Further, the appellant was found 10% contributory negligent. Loss was assessed at $1.3 million and as a result of apportionment and contribution, judgment was entered in the amount of $408,881 plus a small amount of interest.

The issues on appeal

The appellant challenged the findings on apportionment and contributory negligence, as well as the failure to award pre-trial interest. The respondents filed a cross-appeal, challenging the finding that a non-delegable duty was owed, that both they and the RFS breached their respective duties, the finding of nuisance and the assessment of loss.

The Decision on appeal

The decision of the Court of Appeal was given by Basten JA with Meagher JA and Payne JA agreeing. First, Basten JA upheld the trial judge’s finding that the respondents owed a non-delegable duty to prevent the escape of fire resulting from activities from a contractor. Second, Basten JA set aside the finding of liability (in negligence and nuisance) by RFS, holding that on the evidence available to the trial judge, a finding of lack of reasonable care was not available. Further, it was held that there was no evidence to support that the respondents personally should have done more. Accordingly, it was found that the controlled burn was an appropriate exercise, it was carried out at the correct time of year (winter), managed by the appropriate authority (the RFS) and was followed by appropriate monitoring of the ground (namely, by checking the subject tree on two occasions using an ungloved hand to test the soil around its base for warmth). Third, in circumstances where private nuisance is not established as a result of strict liability from harm resulting from any source from a person’s land, but required use of the land that is out of the ordinary, unreasonable or otherwise inappropriate (which was found not to be the case here), the case in nuisance failed as it relied entirely on a failure to take reasonable care. Fourth and arguably most critically, it was found that if the respondents were found liable to the appellant, such liability would not have been an apportionable claim with the RFS in circumstances where the RFS was not liable with respect to that damage (due to the statutory immunity). Fifth, as to whether Pt 4 of the Civil Liability Act applied to apportion liability in circumstances where the respondents were vicariously liable for the RFS, had there been negligence, and on the basis that the respondents owed a non-delegable duty breached by the RFS (which, the Court of Appeal found, there had not been), the respondents would remain liable for the full amount of damages assessed. Sixth, Basten JA found that the evidence did not establish a lack of reasonable care by the appellant (by failing to take steps to monitor the exposure to Myack given the wind conditions forecast) and therefore the finding of contributory negligence should not have been made. Seventh, the challenges to the assessment of damages were rejected on the basis that the trial judge was entitled to rely upon the costing evidence, despite the deficiencies. Lastly, the interest aspect of the appeal was rejected on the basis that it would be double counting to calculate the loss as at the date of trial and add an additional interest amount by reference to that sum.

The appeal was dismissed and cross-appeal allowed with an order that the appellants pay 50% of the respondents’ costs of the appeal.

Implications for you

While this case presents a unique set of factual circumstances, it nevertheless provides useful findings as to contribution and apportionment, namely the interplay between non-delegable duties of care, statutory immunities, apportionment under the Civil Liability Act, vicarious liability and contributory negligence.

Woodhouse v Fitzgerald [2021] NSWCA 54

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