Australia: When will the failure to take precautions against a risk of harm amount to breach of duty?

Background

Mr Reed was the owner of a piece of land near Orange on which he was building a house as an owner/builder. The external walls of the premises were made of compressed straw bales. On 12 January 2007, Mr Warburton, a plumber with whom Mr Reed had contracted, was on the premises to "rough in" water pipes in the kitchen, bathroom and a toilet area off the laundry.

Mr Warburton first started working in the kitchen where the piping was located close to the rear wall where the compressed straw bales were exposed. While working in this area one of the bales ignited. It is not known whether or not this was accidental or deliberate, but nothing of great moment turned on the description. The fire was easily put out with a nearby bucket of water which had been made available.

Despite not using a heat shield or dampening the walls, the soldering in the toilet area off the laundry was completed without event. In Mr Warburton's view, the piping was far enough away from the wall to render these precautions unnecessary.

The work in the bathroom was completed last. The configuration of the bathroom differed from the other two rooms in that the straw bales which formed the rear wall of the bathroom had been lined with inflammable fibro sheeting known as villaboard. Secondly, Mr Reed used loose straw to pack a space created by an intruding wall in the bathroom. While

working in the bathroom an oxyacetylene torch used by Mr Warburton caused a piece of straw to ignite, resulting in the entire premises being destroyed by fire.

District Court Decision

Mr Reed brought proceedings against Mr Warburton for damages as a result of Mr Warburton's negligence. In the event that Mr Reed was successful, damages were agreed between the parties at $210,000.

Both parties agreed that the fire began when the hand-pressed straw in the internal wall of the bathroom caught alight while Mr Warburton was soldering. It was also agreed that loose straw was far more flammable than the compressed straw bales.

Hosking DCJ dismissed Mr Reed's claim and found in favour of Mr Warburton. His Honour held that there was no way that Mr Warburton could reasonably have known of the presence of the loosely packed straw in the area adjacent to where he was soldering as it was concealed by the internal lining. His Honour held that if Mr Reed had informed Mr Warburton of the loose straw, as an experienced plumber, Mr Warburton would have taken different precautions such as carrying out the work in a different way or position.

Court of Appeal Decision

There was no dispute that Mr Warburton owed Mr Reed a duty to take reasonable care to avoid setting fire to any part of Mr Reed's property. The primary issue on appeal was whether Mr Warburton breached his duty of care to Mr Reed, a question to be determined with reference to s 5B. Section 5B provides:

"5B General principles
(1)    A person is not negligent in failing to take precautions against a risk of harm unless:

    (a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and

    (b) the risk was not insignificant, and

    (c) in the circumstances, a reasonable person in the person's position would have taken those precautions.

(2)    In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things):

    (a) the probability that the harm would occur if care were not taken,

    (b) the likely seriousness of the harm,

    (c) the burden of taking precautions to avoid the risk of harm,

    (d) the social utility of the activity that creates the risk of harm."

Mr Warburton submitted that for the purposes of s 5B(1)(a) the foreseeable risk of harm was the risk of damage by fire caused by a compressed straw bale igniting, a risk which had been observed by Mr Warburton when he was working in the kitchen.

Mr Reed submitted that the risk of harm was damage by a fire caused by the straw igniting. Mr Reed argued that any fire had the potential to become uncontrollable and that this depended on how quickly it was detected.

The Court of Appeal held that the risk of harm should be more broadly characterised as the risk of straw igniting as a result of heat emanating directly or indirectly from the oxyacetylene torch. In doing so the Court of Appeal held that it was clear that a far greater risk was foreseeable from loose straw and noted that steps had been taken by the parties to sweep the areas where the soldering was to take place. Moreover, a number of buckets of water were made available in the event of a fire. The Court of Appeal held the assumption that any fire would immediately be detected did not define the limits of foreseeability.

However the risk was characterised, Mr Warburton conceded that it was "not insignificant" for the purposes of s 5B(1)(b) and that a reasonable person would have taken precautions against the risk. The issue in dispute was the nature and extent of the precautions to be taken to protect against the risk of harm.

The Court of Appeal noted that s 5B is directed at instances where a person who has, or should have, identified a risk of harm, must then take "precautions" against it, as opposed to simply exercising reasonable care. Despite the infelicity of the expression of s 5B, the Court of Appeal pointed to the need to avoid an unconscious tendency to look for identifiable precautions instead of considering whether the responsible party simply failed to exercise reasonable care.

The Court of Appeal noted that both elements were present in this case. Mr Reed contended that Mr Warburton failed to take reasonable care in failing to observe the straw protruding from the wall until it was alight, and in failing to take any steps to check for the presence of loose straw in the gap between the villaboard and the vertical stud before commencing the soldering. Mr Reed further contended that Mr Warburton was negligent in failing to take precautions against the risk of harm by not isolating the area in which he was working as required by the relevant Australian Standard. It was also submitted that Mr Warburton should have used a smaller heat shield kept in his truck or asked the plaintiff to cut him a piece of corrugated iron that would fit behind the area to be welded.

It was not known what precisely caused the fire. The Court of Appeal considered that on the balance of probabilities there was exposed straw which Mr Warburton did not notice and which acted as a wick. Alternatively, Mr Warburton allowed heat into the gap of the wall through the space where the corrugated iron did not provide protection. On either view the Court of Appeal held that Mr Warburton was negligent in failing to take reasonable care to avoid the risk of setting fire to the straw. The Court of Appeal held that Mr Warburton's failure to take steps to ensure that heat did not enter the gap was prima facie evidence of a failure to take reasonable care in circumstances were he conceded that he did not know what was in the internal area of the wall. Moreover, the Court of Appeal held that Mr Warburton's failure to see the loose piece of straw until after it was alight was also evidence of a failure to take reasonable care.

There was no dispute that if there was a finding of negligence, the negligence caused the fire for the purpose of s 5D(1)(a) of the CLA and that it was appropriate that liability extend to the harm caused for the purpose of s 5D(1)(b).

Having found that Mr Warburton was negligent in failing to take precautions against the risk of harm, the final question which remained was whether Mr Reed had been contributorily negligent in also failing to take precautions against the risk of harm within the meaning of s 5R(1) of the CLA. The Court of Appeal held that the matter was to be determined by applying the same principles set out in s 5B. This involved a consideration of Mr Reed's knowledge and matters of which he ought reasonably to have been aware as an owner/builder and not someone with the experience and knowledge of a licensed plumber.

Mr Warburton alleged that Mr Reed was contributorily negligent in failing to tell him of the presence of the hand-packed straw in the internal wall. Mr Warburton gave evidence that if he had been warned of the existence of hand-packed straw in the gap in the internal stud wall he would have undertaken his tasks in a different order which would have allowed him to pull the pipe in the bathroom away from the corner and push it back into place once it had cooled. The Court of Appeal noted that while there is a prohibition on a plaintiff making self-serving statements on a hypothetical basis after the event, the prohibition does not extend to a defendant by virtue of s 5D(3)(b) of the CLA which provides:

"(3)    If it is relevant to the determination of factual causation to determine what the person who suffered harm would have done if the negligent party had not been negligent:

...

    (b) any statement made by the person after suffering the harm about what he or she would have done is inadmissible except to the extent (if any) that the statement is against his or her interest."

In cross-examination Mr Reed conceded that the area where Mr Warburton was working was more susceptible to fire because of the presence of the hand-packed straw, of which he failed to advise Mr Warburton. Applying the principles contained in s 5B of the CLA, the Court of Appeal held that Mr Reed failed to take reasonable care in respect of the risk of fire in the bathroom and assessed his contributory negligence at 50%.

Accordingly there was a verdict and judgment in favour of Mr Reed in the sum of $105,000.

Implications

Although headed "Duty of Care", Division 2 of the CLA does not provide any guidance in determining whether a duty of care exists in particular circumstances. The Court of Appeal has confirmed that whether a relationship gives rise to a duty of care is to be determined in accordance with principles established under the general law.

Although s 5B is directed at when there will be a finding of negligence when a person has failed to take precautions against a risk of harm, one must not forget that simply failing to exercise reasonable care in protecting against a foreseeable risk of harm may also amount to a breach of duty of care.

When alleging contributory negligence, a defendant bears the onus of establishing that a plaintiff was negligent in failing to take precautions against the risk of harm by applying the same principles set out in s 5B of the CLA.

1 Hodgson JA, Basten JA, Handley AJA