Australian Consumer Law: Appellate decision

Lets Go Adventures Pty Ltd v Barrett [2017] NSWCA 243 provides an appellate consideration of an injury claim which included a claim under section 60 ACL: the guarantee that services will be rendered with due care and skill.

The judgment opens with some obiter comments by Basten & Gleeson JJA which are of general interest in respect of section 60, section 61, services, the Fair Trading Act and the Good Samaritan provisions. Adamson J said that the matters raised by their Honours were not the subject of argument in this Court and did not require determination for the purposes of the appeal I would prefer not to express a view about them.

At [2] – [8]:

The plaintiff pleaded his claims primarily by reference to ss 60 and 61 of the Australian Consumer Law, wrongly identified as those sections in the Competition and Consumer Act 2010 (Cth). That pleading required that the plaintiff be a “consumer” as defined in s 3 of the Australian Consumer Law, and not, as pleaded, by reference to the definition in s 51ACA of the Competition and Consumer Act, dealing with industry codes. As limited attention was given to whether or not the plaintiff was a “consumer” acquiring services, pursuant to s 3(3) of the Australian Consumer Law, it would have been appropriate to refer to the presumption in s 3(10).

The primary basis of claim turned on s 60 of the Australian Consumer Law which provides as follows:

60   Guarantee as to due care and skill

If a person supplies, in trade or commerce, services to a consumer, there is a guarantee that the services will be rendered with due care and skill.

Section 61 involves additional issues and relevantly provides:

61   Guarantees as to fitness for a particular purpose etc.

(1)   If:

(a)   a person (the supplier) supplies, in trade or commerce, services to a consumer; and

(b)   the consumer, expressly or by implication, makes known to the supplier any particular purpose for which the services are being acquired by the consumer;

there is a guarantee that the services, and any product resulting from the services, will be reasonably fit for that purpose.

…

(3)   This section does not apply if the circumstances show that the consumer did not rely on, or that it was unreasonable for the consumer to rely on, the skill or judgment of the supplier.

These provisions require careful attention to the “services” which were provided. The statement of claim identified them as “scuba diving” and stated that the services included “the provision of adequate and safe equipment and supervision during the provision of the services.” The failure to identify the services with precision caused difficulties in identifying what were relevant breaches of the s 60 guarantee and in demonstrating causation.

The defendant relied upon ss 5G and 5H of the Civil Liability Act 2002 (NSW) (obvious risk), s 5I (inherent risk), s 5L (dangerous recreational activity), s 5M (risk warning) and s 5N (waiver). In dealing with the relationship between the Australian Consumer Law and the Civil Liability Act, the Court was invited (an invitation which was accepted) to apply the principles identified by Meagher JA in Motorcycling Events Group Australia Pty Ltd v Kelly. [1] That was not entirely helpful. That case turned in part on the operation of s 74(2A) of the Trade Practices Act 1974 (Cth), as then in force, which was not expressed in the terms of a guarantee but in the terms of an implied warranty incorporated into the contract between the supplier and the consumer. That section has been replaced by s 275 of the Australian Consumer Law. Further, the application of State law also depended on the operation of s 68B of the Trade Practices Act, which has been replaced by s 139A of the Competition and Consumer Act. Ultimately, this case did not turn on any contractual exclusion of liability. Because s 74(2A) dealt with breaches of an implied warranty, rather than failure to comply with a guarantee, to the extent that it saved the operation of the Civil Liability Act, it was necessary to have regard to the specific terms of the relevant provisions of the Civil Liability Act with respect to a course of action based on a statutory guarantee, rather than a contractual warranty.

The plaintiff’s pleading assumed, no doubt correctly, that the standard set by the guarantee of “due care and skill” could properly be equated with the common law duty to take reasonable care, if the scope of the services was adequately identified. (Negligence was relied upon as an alternative cause of action.) However, a different analysis was required with respect to the guarantee of fitness for a particular purpose, language which was not addressed at the trial. [2] With respect to damages, attention should also be paid to s 267 of the Australian Consumer Law.

In addition, it may be appropriate in some cases to proceed under the Fair Trading Act 1987 (NSW), Pt 3 of which picks up and applies as New South Wales law the Australian Consumer Law. [3] Under s 4(6) of the Fair Trading Act, the Civil Liability Act is “paramount legislation” and in the case of inconsistency prevails over that Act, but not the Australian Consumer Law (NSW). Accordingly, the relationship of the Australian Consumer Law (NSW) with the Civil Liability Act depends on the effect of s 275 of the Australian Consumer Law, operating as State law.

There was also some confusion in the Court below as to the operation of the so-called “good samaritan” provisions in Pt 8 of the Civil Liability Act. Section 57 provides immunity from civil liability for one who “comes to the assistance of a person who is apparently injured or at risk of being injured.” [4] The reference to “good samaritan” appeared in a somewhat inarticulate paragraph in the statement of claim alleging a particular of breach of duty in so far as the defendant advised Mr Moore to dive down to alert the plaintiff of his, Mr Moore’s, difficulties, thus placing him at risk of injury “for which events the plaintiff would be bound to act as a good Samaritan and/or otherwise come to his aid”. The trial judge noted submissions that the plaintiff “may have been a good Samaritan in getting [Mr] Moore out of the water and on board the vessel following the dive” but that “the plaintiff ceased to be a good Samaritan thereafter”. These submissions should have been dismissed as incoherent. Nobody had sued the plaintiff; it is a defendant who obtains immunity from liability for acting as a “good samaritan”. So far as the plaintiff was concerned, the provisions in Pt 8 of the Civil Liability Act were simply irrelevant.

 

Medical testing of excised tissue in the context of litigation

James v Seltsam Pty Limited & Anor [2017] VSC 506 is an interesting interlocutory decision, for it focus on an application by defendant for an order requiring submission of plaintiff’s explanted lung for testing. The purpose of the testing was to shed light on whether the plaintiff suffered asbestosis or some other condition.

At [71] the court concluded that the the explanted lung is ‘property’ for the purposes of r 37.01. The court did not need to determine who owned that property; an order could be made directed at the laboratory holding the tissue.

There was no evidence of prejudice to the plaintiff in the lung being destroyed, such as the loss of an opportunity for further testing: [76].

At [82] the court noted:

I have already expressed my opinion that the testing to be undertaken on the lung has the potential – subject to interpretation of the results by medical experts – to determine a central question in this case which could, indeed, dispose of the case in its entirety.  As such, there seems little doubt that an order requiring the production and testing of the lung will facilitate the just outcome of the case.

And at [92]:

I consider, in the circumstances, that even though this is a test that has not been routinely used in the diagnosis of asbestosis or in litigation of asbestos related disease, the testing and the analysis goes to a critical and relevant issue in the case. I do not consider it to be a fishing expedition.  The testing has been recommended by a respiratory physician and on balance may be of forensically probative value in determining the critical issue of diagnosis.

 

Late service of evidence

Pierides v Monsash Health [2017] VSC 564 is an interlocutory decision concerning late service of evidence. The court discussed potential prejudice (at [32]) and the potential for delay. An interesting aspect of the decision is the mention (at [43]) of disclosure of counsel’s notes of a conference with an expert witness.

NDIS: AI plans delayed?

ABC News has reported today on apparent delays in the implementation of the NDIS AI project ‘Nadia’,  being built on the cognitive technology developed by the IBM Watson team.

“The NDIA board and executive was told earlier this year the second stage of Nadia’s rollout would begin mid-year and involve volunteer participants being part of her training phase.

But Nadia’s 12-month “traineeship” never started and multiple sources close to the project have told the ABC they fear the census and Centrelink ‘robo-debt’ debacles took their toll on government-wide appetite for risk.”

NSW / ACT: Forum issues

Desmond v ACT Health t/as The Canberra Hospital [2017] NSWDC 263 saw the court called upon to consider an application by the defendant,  following the issue of proceedings in New South Wales in respect of treatment which was carried out in the Australian Capital Territory.

The court refused the defendant’s application for a stay of the New South Wales proceedings, concluding at [29] – [30]:

I am enjoined by s 56(1) of the Civil Procedure Act 2005 “to facilitate the just, quick and cheap resolution of the real issues in the proceedings”. I wholly accept that, if there be no similar statutory provision applicable in the ACT, that both the ACT Supreme Court and the ACT Magistrates Court are guided by such principles, the same principles which are common these days to every court in this land. However, it appears to me that it is in the interests of both the plaintiff and the defendant that these fairly straightforward proceedings be determined as quickly as possible, if not by the parties themselves reaching an agreement, then by the curial process. As I said earlier, that will occur by early 2018 if the proceedings remain in this Court but, if these proceedings are stayed, the plaintiff might not have a resolution of her matter until approximately a year later.

Such differences as there are between this Court and the Courts of the ACT are not very great at all and the distance between Sydney and Canberra is not particularly great either. If anything does arise which would require, for example, necessary evidence to be taken locally, then this Court could adjourn from sitting in Sydney to take evidence in Queanbeyan or Goulburn or even Yass, which was once a proclaimed place. I am not persuaded that the defendant has satisfied the onus which it bears of substantiating the justification of a stay pursuant to s 20. The application is accordingly dismissed.

 

Withdrawal of treatment: No need for court approval

M v A Hospital [2017] EWCOP 19 was a decision yesterday of the Court of Protection (England and Wales) which is being reported as marking a shift in the law in England on the need for court orders to end clinically assisted nutrition and hydration (CANH) for patients in a permanent vegetative state. However it has also been reported that the Official Solicitor may appeal the ruling.

The patient M suffered Huntington’s disease. The court ordered that clinically assisted nutrition and hydration could be withdrawn as it was not in the best interests of M.

In relation to the need for court orders, the court concluded that the decision about what was in M’s best interests is one that could lawfully have been taken by her treating doctors, having fully consulted her family and having acted in accordance with the Mental Capacity Act 2005 and with recognised medical standards.

The court explained at [37]:

On the facts of this case, I do not consider it to have been a legal requirement for the decision to withdraw CANH to have been taken by the court, though it is entirely understandable that the parties sought an external decision, given the state of the law. My reasoning on the question is as follows:

(1) There was no statutory obligation to bring the case to court, and although the cases and materials mentioned in this judgment are of considerable authority, they do not all point in one direction and they are not formally binding upon me. None of them sustains the proposition that a court decision is necessary as a matter of law, as opposed to as a matter of practice. What is however clear is that the court is not the source of lawfulness: it identifies whether treatment is or is not lawful, but it cannot make unlawful treatment lawful, or vice versa.

(2) The essential question is whether the state’s Art. 2 duty mandates court oversight as a matter of law. I do not consider that it does, for these reasons:

(i) The present practice is anomalous. The right to life belongs to everyone, enabled and disabled. Individuals who are in PVS or MCS are at the extremes of vulnerability, but many among us will at some time in our lives come to be in a precarious state. Overwhelmingly, treatment decisions up to and including the withholding and withdrawal of life-support are taken by clinicians and families working together in accordance with recognised good practice. No one suggests that these decisions should all be the subject of external supervision.

(ii) The question that therefore needs to be answered is whether it is necessary and proportionate for legal proceedings to be required only in a limited subset of cases. Are these cases so different in kind to other serious medical treatment decisions as to justify a completely different approach? In my view, they are not. The reasons given for requiring all PVS/MCS cases to come before the court could equally apply to a very much larger patient population.

(iii) Consideration must also be given to the deterrent effect of costly and time-consuming proceedings, both on the individual case and on the patient population in general. The equality rights of disabled persons require clinicians and carers to take reasonable steps to assure themselves that the treatment and care they are providing is and continues to be beneficial, and that the person’s unique point of view is not forgotten because they are unable to express it for themselves. A mandatory litigation requirement may deflect clinicians and families from making true best interests decisions and in some cases lead to inappropriate treatment continuing by default. Indeed, the present case stands as an example, in that M received continued CANH that neither her doctors nor her family thought was in her best interests for almost a year until a court decision was eventually sought.

(iv) It is not suggested that the court should be involved in PVS/MCS cases where there is a valid and applicable advance decision, yet the grave consequences of the decision and the risk of error are no different in such cases.

(3) In my judgment, therefore, a decision to withdraw CANH, taken in accordance with the prevailing professional guidance – currently the GMC’s Good Medical Practice guidance, the BMA guidance ‘Withholding and Withdrawing Life-prolonging Medical Treatment’ and ‘End of Life Care’ and the Royal College of Physicians’ Guidance on Prolonged Disorders of Consciousness – will be lawful and the clinicians will benefit from the protection of s.5. The court is always available where there is disagreement, or where it is felt for some other reason that an application should be made, but this will only arise in rare cases, such as Aintree.

(4) This conclusion does not in any way detract from the crucial importance of structured medical assessment in PVS/MCS cases: see Baker J in W v M at [258-9] and Newton J in St George’s Healthcare NHS Trust v P & Q [2015] EWCOP 42 at [46-49]. Nor does it detract from the obvious need for expert second opinions in these cases.

UK settlement: ‘Innovative’ and other treatments by Ian Patterson

BBC News has reported a settlement of some 37 million pounds for patients of Dr Ian Patterson. Part of the settlement came from the hospital were Dr Patterson was working. The remainder came from a former hospital which is said to have failed to notify the later hospital  of Dr Paterson’s dangerous methods discovered while working for the former hospital.

Paterson was found guilty of 17 counts of wounding with intent in April after a trial at Nottingham Crown Court. In August, he had his 15-year jail term increased to 20 years after the Appeal Court ruled his term was too lenient.

The article summarises the background:

Ian Paterson’s victims fall broadly into two camps. Those who underwent unnecessary surgery, and those who did need operations but were left prone to cancer returning because of the untried technique he used.

The criminal trial dealt with cases from the first group – nine women and a man who were either subjected to intrusive surgery or had their breasts removed despite there being no evidence that there was anything wrong them.

The civil case which was settled today involved the many others whose cases did not come to court, as well as those who were treated using something called a cleavage-sparing operation in which tumours were removed but potentially cancerous tissue was left behind.

The technique was something that was only ever performed by Paterson and never properly tested.

The surgeon’s trial heard he wildly exaggerated his patients’ cancer symptoms, leading them to have several needless operations which left them scarred for life physically and emotionally.

Fellow medics at Solihull Hospital first raised concerns about his conduct in 2002 when it emerged Paterson, who grew up in County Down, Northern Ireland, was carrying out unregulated ‘cleavage-sparing’ mastectomies on cancer patients, which left them at higher risk of the disease returning.

Despite three reports into his actions, he carried on working until 2011 when he was suspended by the trust.

With thanks to David Hirsch barrister, for noting this development.

Surrogacy costs as damages

XX v Whittington Hospital NHS Trust [2017] EWHC 2318 (QB) saw a claim for delayed diagnosis of cervical cancer, as a result of which the claimant  developed invasive cancer of the cervix for which she required chemo-radiotherapy treatment that led to infertility and severe radiation damage to her bladder, bowel and vagina.

Part of the damages claim was for surrogacy costs for 4 pregnancies, to be achieved in California rather than in the UK. The court noted at [31] – [32]:

The Claimant and her partner wish to enter into a commercial surrogacy arrangement in California and have a clear preference for doing so there rather than in the UK or elsewhere. The advantages over the UK, where commercial surrogate arrangements are illegal are clear; the system is well established, the arrangement binding and the intended parents can obtain a pre-birth order from the Californian court confirming their legal status in relation to the surrogate child. By contrast, in the UK, not only are commercial surrogate arrangements illegal, but it is a criminal offence to advertise either for a surrogate or to be a surrogate. Surrogacy Arrangements Act 1985 ss.2 and s.3. (SAA) Any such arrangement is unenforceable. Surrogacy is permitted if it is non-commercial and only reasonable expenses are paid to the surrogate mother. It can be arranged privately, with e.g. a relative provided the rules as to reasonable pregnancy expenses are observed, but is often done through one of the established recognised agencies such as COTS (Childlessness Overcome Through Surrogacy). Where legal surrogacy is carried out the surrogate mother is the legal mother of the child. In theory, although it is rare in practice, the surrogate mother could refuse to give the child to the intended parents. It is necessary for the intended parents to apply to the courts in the UK for a parental order post birth.

Another disadvantage of the UK system in the eyes of the Claimant is that it is the surrogate mother who chooses the intended parent rather than the other way round. The Claimant says in her witness statement that the idea of being at the mercy of someone else’s choosing, and attending informal parties to meet surrogate mothers frightens her. She states that that is not something she could do. In her evidence however she said that she is so determined to have children that she would use the UK system if the court does not award her the expense of surrogacy in California.

The Court concluded at [49] – [52]:

The situation in so far as the claim relating to the UK is concerned is, in my judgement different. It is not illegal nor contrary to public policy to use an agency to find and use a surrogate mother provided the requirements of the Act are fulfilled. As Lady Justice Hale said in Briody when dealing with this situation obiter, given the right evidence of the reasonableness of the procedure and the prospects of success such a case should be capable of attracting an award. (para 32) It is also correct that she said that her tentative view was that such a claim was a step too far. If however, as here, the prospects of success of a live child being born are reasonable if not good, and the Claimant has delayed her cancer treatment to ensure her eggs were harvested, I find it difficult to see why, both on general principle, and based upon Lady Justice Hale’s own view, such a case should not be “capable of attracting an award”, and why the claim relating to the UK should not succeed.

The use of a mother’s own eggs is however to be contrasted with a claim based on the use of donor eggs. I am bound by the decision in Briody to reject such a claim. (para 25) The loss that the injured mother sustains is the inability to have her child, not a child. The use of donor eggs is not therefore restorative of her loss. Even if that part of the decision were technically obiter I would adopt the reasoning of the Court of Appeal and reject any claim in respect of donor eggs. If the loss was to be properly regarded as the loss of a child it would not be reasonable or proportionate to require a defendant to pay for the cost of donor egg surrogacy.

I therefore limit the claim for surrogacy in the UK, using the Claimant’s own eggs, to the cost of surrogacy for 2 children, as I am satisfied on the balance of probabilities on the expert evidence that the Claimant will achieve two live births.

It cannot be properly argued that the claim for surrogacy costs should be diminished or rejected because the Claimant will have substantial other funds by way of damages. The other heads of damage are compensatory and should not be treated as a substitute for another valid head of claim. This does not alter the fact that a successful Claimant may choose to spend her damages as she wishes.

Complaints patterns: Lawyers not much different to doctors?

Published yesterday on SSRN under the title Characteristics of Lawyers Who are Subject to Complaints and Misconduct Findings, researchers well known for their work on doctors complaint patterns have examined  complaints lodged between 2005 and 2015 in Victoria with the main regulator of the legal profession in Victoria. The abstract explains:

Regulators of the legal profession are charged with protecting the public by ensuring lawyers are fit to practice law. However, their approach tends to be reactive and case-based, focusing on the resolution of individual complaints. Regulators generally do not seek to identify patterns and trends across their broader caseloads and the legal profession as a whole. Using administrative data routinely collected by the main regulator of the legal profession in Victoria, Australia, we analyzed risk factors for complaints and misconduct findings. We characterized complaints lodged between 2005 and 2015 and the lawyers against whom they were made. We found that the odds of being subject to a complaint were higher among lawyers who were male, older, had trust account authority and whose practices were smaller, in non-urban locations, and incorporated. Deeper understanding of these risk factors could support efforts to improve professional standards and reform regulatory practices.

 

Sklar, Tara and Taouk, Yamna and Studdert, David M. and Spittal, Matthew J. and Paterson, Ron and Bismark, Marie M,   Characteristics of Lawyers Who are Subject to Complaints and Misconduct Findings (September 15, 2017).   Available at SSRN: https://ssrn.com/abstract=2988411

Why do surgeons receive more complaints than their physician peers?

Now available online in advance of publication in the ANZ Journal of Surgery in November 2017 is an article by Tibble & others entitled Why do surgeons receive more complaints than their physician peers?.

In their abstract the authors indicate that surgeons are more than twice as likely to attract complaints as their physician peers. This elevated risk arises partly from involvement in surgical procedures and treatments, but also reflects wider concerns about interpersonal skills, professional ethics and substance use.

Consistent with previous studies, the authors found that being older; male; and a specialist in neurosurgery, plastic surgery or orthopaedics were risk factors for complaints.

The analysis was of over 5500 complaints lodged with regulators in Australia over a six-year period.

H. M. Tibble MPhil; N. S. Broughton MBChB

(Hons), FRACS; D. M. Studdert LLB, ScD;

M. J. Spittal MBioStat, PhD; N. Hill MBChB,

FRACS; J. M. Morris BA, BSc; M. M. Bismark

MD, FAFPHM.

Correspondence

Associate Professor Marie M. Bismark, Melbourne

School of Population and Global Health, The

University of Melbourne,

Email: mbismark@unimelb.edu.au