Suicide following use of smoking cessation drug Varenicline

The Inquest into the death of Timothy John (Coroners Court of Queensland 14 September 2017) saw the Coroner address:

  • Whether the use of  a smoking cessation drug  ‘Champix’ contributed to the death of Mr John (aged 22 years);
  • The adequacy of care provided by a general practitioner; and
  • The adequacy of product labelling and instructions provided with the drug in relation to potential adverse neuropsychological effects.

Shortly before the inquest, the results of a study (the EAGLES) study were released. The Coroner noted at [148] – [150] that in the cohort of patients without a history of psychiatric disorder, Chantix was not associated with an increased incidence of clinically
significant neuropsychiatric adverse events. However, in the cohort of patients with a history of psychiatric disorder, there were more clinically significant neuropsychiatric adverse events reported with Chantix, compared to the non-psychiatric cohort. The risk increase was 2.7%.  The Coroner found that the drug ‘contributed to’ the death of Mr Johns.

In relation to the general practitioner, the Coroner found that there was not adequate care because of the doctor’s failure to familiarise himself with the precautions for the drug, to put in place a follow up  plan and to carry out a more thorough interview at an appointment  (at [159]). There was mention of the practicality of advising the family of Mr John to monitor him for neuropsychiatric symptoms.

Inadequacies in the product information document were identified and changes were recommended, including in relation to alerting the family of a patient (at [166]).

The coroner also recommended that  all State and Territory forensic pathology services follow Victoria’s lead and routinely screen for Varenicline in relation to suicides
and suspected suicides (at [168]).

Duties of care: SIEV 221

Not a medical claim, Ibrahimi & ors v Commonwealth of Australia (No 9) [2017] NSWSC 1051 is nevertheless of interest for its consideration of a number of legal issues that sometimes arise in novel medical claims and under the civil liability legislation:

  • Whether a novel duty of care may be owed when the defendant did not create the relevant risk;
  • The existence or otherwise of a general duty to rescue;
  • The tension between a proposed duty of care and a statute (in this case, the Migration Act;
  • Whether a duty of care was owed to relatives of passengers to avoid forseeable psychiatric injury, nor to onlookers or rescuers;
  • The relevance of risks being inherent and obvious;
  • The social utility of the activity and what a reasonable public authority would have done.

The first of a detailed set of catchwords explains:

Torts – Negligence – Duty of care – Where a suspected illegal entry vessel with a number of people on board sailed from Indonesia to Australia – Where those on board were attempting to gain entry into Australia illegally – Where vessel experienced monsoonal weather conditions near Christmas Island and became shipwrecked – Where a number of people lost their lives – Where Border Protection Command was carrying out an operation in the vicinity of Christmas Island one of the objects of which was to intercept suspected illegal entry vessels – Whether the defendant owed to passengers on board such vessels which approached Christmas Island between September and December 2010 a duty to take reasonable care in the exercise of its powers and the deployment of its resources so as to avoid foreseeable physical harm to those passengers

The findings were:


(i) there is no general test for determining whether, for the purposes of the law of negligence a duty of care is owed. Different cases necessarily raise different issues. Determining whether a duty of care is owed requires an evaluation of the relevant factors which tend to operate in favour, or against, that conclusion. Those factors include any relevant characteristics of the relationship between the parties. Evaluation may also involve a process of analogical reasoning: at [197].

Caltex Refineries (Qld) Pty Limited v Stavar (2009) 75 NSWLR 649; [2009] NSWCA 258 applied.

(ii) control is of fundamental importance in determining whether a duty of care is owed, particularly where the duty is said to be owed by a public authority: at [200]-[201].

Brodie v Singleton Shire Council; Ghantous v Hawkesbury Shire Council (2001) 206 CLR 512; [2001] HCA 29; Crimmins v Stevedoring Finance Committee (1999) 200 CLR 1; [1999] HCA 59; Graham Barclay Oysters Pty Limited v Ryan (2002) 211 CLR 540; [2002] HCA 54 referred to.

(iii) the defendant had no control over the risk that a SIEV, if not intercepted, might be shipwrecked on the coast of Christmas Island due to factors such as poor weather, poor navigation or running out of fuel. Further, the defendant did not put the plaintiffs at any risk of harm. In particular, the defendant:

(a) could not, and obviously did not, direct those in charge of the vessel to navigate a particular route to Australia;

(b) did not control the weather;

(c) did not control and, on the evidence, knew nothing at all about, the level of skill of those operating the vessel; and

(d) had no control over the primitive nature of the vessel: at [202].

(iv) the only matter over which the defendant had any relevant control was its response to the risk of harm which had arisen. The defendant did not create that risk, and did not, by its actions, make it worse. In all of the circumstances, the defendant’s lack of control tended against a conclusion that it owed a duty of care to the plaintiffs: at [203]-[204].

Electro Optic Systems Pty Limited v State of New South Wales; West & anor. v State of New South Wales (2014) 180 ACTR 1; [2014] ACTCA 45; Warragamba Winery Pty Limited v State of New South Wales (No. 9) [2012] NSWSC 701 referred to.

(v) those on board SIEV 221 were not vulnerable in the relevant sense. In this context, vulnerability referred to the inability of those on board to protect themselves from the consequences of the defendant’s conduct which was said to have been negligent. Those on board could have protected themselves simply by not undertaking the voyage in the first place. The absence of any relevant vulnerability was a further factor tending against a conclusion that a duty of care was owed: at [206]-[207].

Hunter Area Health Service v Presland (2005) 63 NSWLR 22; [2005] NSWCA 33 applied.

(vi) Australian courts have consistently concluded that there is no general duty to rescue. There is no authority which supports the proposition that in a maritime context, a duty of care is imposed upon any person to rescue a stranger in peril: at [219].

Walsh v Zuisei Kaiun K. K (1980) AMC 2788; Moragne v States Marine Lines Inc (1970) AMC 967; Mobil Oil Corp. v Higginbotham (1978) AMC 1059; Bach v Trident Shipping Co. Inc. 708 F. Supp. 776 (ED. La. 1989); Caminiti v Tomlinson Fleet (1981) AMC 201; Stuart v KirklandVeenstra (2009) 237 CLR 215; [2009] HCA 15 considered; Lowns v Woods (1996) Australian Torts Reports 81-376 distinguished.

(vii) the evidence did not support a conclusion that the defendant, by exercising its power to address maritime threats, had assumed any responsibility to ensure the safe arrival of persons who were seeking to enter Australia illegally. There was no duty to rescue imposed on the defendant. The fact that the defendant had engaged in rescue efforts did not mean that it owed a duty of care to those on board: at [222]-[224].

Capital and Counties PLC v Hampshire County Council and ors [1997] 3 WLR 331; State of NSW v Tyszyk [2008] NSWCA 107; Alexandrou v Oxford[1993] 4 All ER 328 referred to.

(viii) the fact that nothing done by the defendant in the course of assisting with the rescue increased the relevant risk of harm was a further factor tending against a conclusion that a duty of care was owed: at [225].

Graham Barclay Oysters Pty Limited v Ryan (2002) 211 CLR 540; [2002] HCA 54 referred to.

(ix) the statutory forfeiture of the vessel to the defendant, pursuant to which the defendant became the owner, did not result in the defendant assuming duties and responsibilities analogous to those owed by an occupier of premises to an entrant: at [239].

International Finance Trust Co Limited v NSW Crime Commission (2009) 240 CLR 319; [2009] HCA 49; Tran v The Commonwealth (2010) 187 FCR 54; [2010] FCAFC 80; Olbers Co Ltd v The Commonwealth (2004) 136 FCR 67; [2004] FCA 229; referred to.

(x) the broader underlying policy of the Migration Act 1958 (Cth) was also inconsistent with the existence of the duty of care posited by the plaintiffs: at [240]-[243].

Plaintiff S4/2014 v Minister for Immigration and Border Protection (2014) 253 CLR 219; [2014] HCA 34; Al-Kateb v Godwin (2004) 219 CLR 562; [2004] HCA 37; CPCF v Minister for Immigration and Border Protection (2015) 255 CLR 514; [2015] HCA 1 referred to.

(xi) to recognise a common law duty of care in the circumstances, the objective effect of which would be to stimulate the conduct which was sought to be suppressed by the underlying policy of the Migration Act 1958 (Cth), served to highlight the obvious tension between that policy, and the assistance of persons who unlawfully come to Australia and, in doing so, find themselves in distress at sea: at [242]-[243].

CPCF v Minister for Immigration and Border Protection (2015) 255 CLR 514; [2015] HCA 1; CAL No. 14 Pty Limited v Tandara Motor Inn v Motor Accidents Insurance Board (2009) 239 CLR 390; [2009] HCA 47 referred to.

(xii) it followed that no duty of care was owed by the defendant to the plaintiffs: at [242].

(xiii) no duty of care was owed by the defendant to the relatives of passengers on board SIEV 221 to avoid foreseeable psychiatric injury to those persons: at [264]-[265].

Tame v State of NSW; Annettes v Australian Stations Pty Limited (2002) 211 CLR 317; [2002] HCA 35; Sheehan v State Rail Authority of NSW; Wicks v State Rail Authority of NSW (2010) 241 CLR 60; [2010] HCA 22; Gifford v Strang Patrick Stevedoring Pty Limited (2003) 214 CLR 269; [2003] HCA 33 referred to.

(xiv) the defendant did not owe a duty to rescuers and/or onlookers to avoid foreseeable mental harm to such persons: at [288].

Chapman v Hearse (1961) 106 CLR 112; [1961] HCA 46; Mt Isa Mines v Pusey (1970) 125 CLR 383; [1970] HCA 60; Sheehan v State Rail Authority of NSW; Wicks v State Rail Authority of NSW [2009] NSWCA 261; McDonald v Shoalhaven City Council [2013] NSWCA 81; FAI General Insurance Company Limited v Lucre (2000) 50 NSWLR 261; [2000] NSWCA 346 referred to.

(xv) the defendant did not owe a duty of care to passengers on board the vessel to avoid foreseeable loss of property belonging to those passengers: at [292].

(xvi) there was a risk that a SIEV heading south through territorial waters towards Christmas Island would, if not intercepted, be shipwrecked on the cliffs of Christmas Island resulting in catastrophic loss of life. However that risk was not brought about by any conduct on the part of the defendant and was, in any event, both inherent and obvious, and thus one in respect of which the defendant was not liable: at [307]; [312].

Paul v Cooke (2013) 85 NSWLR 167; [2013] NSWCA 311 referred to.

(xvii) the risk that a SIEV heading south through territorial waters towards Christmas Island would, if not intercepted as part of the defendant’s interception operation, be shipwrecked on the cliffs of Christmas Island, resulting in catastrophic loss of life, was both foreseeable and not insignificant: at [315]; [317].

(xviii) two other vessels which might otherwise have been available to the Volunteer Marine Rescue Service on Christmas Island were out of survey and thus unavailable to be used in the attempted rescue. However even if they had been available, the evidence established that as a result of the prevailing weather conditions, they could not have been put to use. Moreover, the activity which created the harm in the present case was the travel to Australia, on an unseaworthy vessel, by a group of persons whose aim was to enter Australia illegally in contravention of the Migration Act 1958 (Cth). In these circumstances that activity had no social utility and a reasonable public authority in the position of the defendant would not have taken the precaution of not permitting the two vessels to remain out of survey: at [327]-[329].

(xix) the decision made by the Commanding Officer of the HMAS Pirie, Commander Livingstone, to remain in close proximity to Suspected Illegal Entry Vessel 220 on the afternoon of 14 December 2010 and into the morning of 15 December 2010 was well founded, responsible and a proper discharge of his duties: at [344].

(xx) on the information which was made available to him at about 06:00 on 15 December 2010, Commander Livingstone did not know, nor did he have reason to suspect, that SIEV 221 was in distress: at [352]-[354].

(xxi) the response by HMAS Pirie and Australian Customs vessel Triton to the events which unfolded was not delayed, let alone delayed unreasonably: at [371]; [373].

(xxii) because of the weather conditions at the time, it would have been neither safe nor viable to launch vessels which might otherwise have been available to the Volunteer Marine Rescue Service: at [389]-[390].

(xxiii) the evidence did not support a conclusion that even if the HMAS Pirie had relinquished its position in close proximity to Suspected Illegal Entry Vessel 220 and had undertaken a patrol further to the north of Christmas Island it would have detected SIEV 221 and been able to intercept it: at [391].

(xxiv) towing SIEV 221 away from the cliff face was not a viable option for a number of reasons: at [393].

(xxv) the nature of section 265 of the Navigation Act 1912 (Cth), namely a penal provision prescribing a term of imprisonment, tended against the proposition that it imposed an additional civil liability on the defendant: at [411].

Byrne & Frew v Australian Airlines Limited (1995) 185 CLR 410; [1995] HCA 24; Stuart v KirklandVeenstra (2009) 237 CLR 215; [2009] HCA 15; Cutler v Wandsworth Stadium Limited [1949] AC 398; Sovar v Henry Lane Pty Limited (1967) 116 CLR 397; [1967] HCA 31; O’Connor v S P Bray Limited (1937) 56 CLR 464; [1937] HCA 18; Gardner v State of Victoria [1999] 2 VR 461; [1999] VSCA 100 referred to.

(xxvi) there was no failure on the part of the Commanding Officers of either HMAS Pirie or Australian Customs Vessel Triton to proceed with all practical speed to the assistance of passengers on board SIEV 221 once they became aware that SIEV 221 was in fact in distress: at [420].

(xxvii) the defendant became the owner of SIEV 221 by virtue of statutory forfeiture but it did not, as a consequence, assume obligations in relation to either the condition of the vessel or the safety of its passengers: at [428]-[429].

(xxviii) the defendant did not, by reason of its ownership of SIEV 221, owe any statutory duty to the plaintiffs derived from the provisions of the Navigation Act 1912 (Cth): at [437]; [441]-[442].

(xxix) the defendant did not “send” SIEV 221 to sea. The phrase “sends any ship to sea” as it appears in s. 208 of the Navigation Act 1912 (Cth) did not mean to “allow any ship to remain at sea”: at [439]-[440].

(xxx) sections 208 and 227B of the Navigation Act 1912 (Cth) are penal provisions, the nature of which tends against the proposition that they ground a cause of action for breach of statutory duty: at [443]

Minister for Immigration and Citizenship v SZIZO (2009) 238 CLR 627; [2009] HCA 37 referred to.

(xxxi) a court has power to grant leave to amend a pleading so as to include a new cause of action which would otherwise be statute barred, providing the claim based on the new cause of action arises substantially out of the same facts as those involved in the original claim. Whether that test is met is a matter of general impression: at [456].

Brickfield Properties Limited v Newton [1971] 1 WLR 862; McGee v Yeomans [1977] 1 NSWLR 273; State of NSW v Radford (2010) 79 NSWLR 327; [2010] NSWCA 276 referred to.

(xxxii) the causes of action brought by the plaintiffs were not statute barred: at [460]; [464].

Video evidence of psychiatrist from overseas, consular posts + ‘The Simpsons’

In what is perhaps a procedural circumstance peculiar to the ACT courts, in R v Woutersz [2017] ACTSC 212 Justice Penfold has commented on the unsatisfactory lack of legislative clarity on whether the ACT courts are not intended to be able to receive evidence by audio or audiovisual link from locations outside Australia (other than New Zealand, which is provided for in the Evidence and Procedure (New Zealand) Act 1994(Cth) and the Court Procedures Rules 2006 (ACT), div 6.10A.4), or whether such evidence should be receivable in particular circumstances and depending on the court’s satisfaction as to specified matters.

Ultimately the court ruled in favour of allowing evidence from Dr Bruce Westmore via audio or videolink from Canada. However the decision is likely to receive equal attention for a reference to The Simpsons in the following passage at [46]:

I note in passing that the proposition that the premises of a consular post are part of the territory of the sending State seems to be a widely-held misconception, dating back many years in the history of international law but possibly given broader currency, among other things, by an episode of the TV series “The Simpsons” in which the Simpson family visits Australia. Irrespective of its origins, the proposition remains a misconception, and does not help in identifying a basis on which evidence can be received from Canada by audiovisual link, even from within a consular post.

AHPRA: Paramedics regulation & other changes

The Health Practitioner Regulation National Law and Other Legislation Amendment Bill 2017 was passed last week by the Queensland Parliament and is expected to gain assent shortly. The amendments will apply in all States and Territories except Western Australia. South Australia will need to make a regulation to give effect to the amendments.

The amendments summarised by AHPRA include:

  • Introduction of national regulation of paramedics: This will mean the establishment of the Paramedicine Board of Australia, with national registration of paramedics expected to commence in the second half of 2018.
  • Recognising nursing and midwifery as separate professions: The National Law will be updated to recognise the two professions as separate. There is no plan to change the structure of the NMBA or for how nurses and midwives will interact with the Board.
  • Changes to strengthen the management of complaints (notifications) and disciplinary enforcement powers of AHPRA and National Boards
  • Additional powers for the COAG Health Council (formerly operating as the Australian Health Workforce Ministerial Council) to change the structure of National Boards.

Defamation regarding medical treatment

O’Neill v Lewis [2017] NSWSC 1213 is an interlocutory decision in which each of the parties is a doctor. The proceedings arose out of a series of remarks made by the defendant following a boxing match attended by the plaintiff as doctor.

The burden of the defamation complained was that the plaintiff allowed the fight to continue when it ought to have been stopped, because one of the boxers was obviously concussed.

The interlocutory decision focused on whether aspects of the pleading were different in substance. The court held that the imputations did differ in substance however the plaintiff was required to re-plead the statement of claim to cure the defects in some imputations.

Psychiatric assessments of claimant by two defendants

Plaintiff v Stapleton [2017] NSWSC 914 considered the merits of a plaintiff undergoing two psychiatric assessments for two defendants, not in the context of a medical claim but rather in an abuse compensation claim. The defendants were the alleged perpetrator, a school and the Commonwealth of Australia.

The court held that of itself, the request that the plaintiff attend an examination by a psychiatrist chosen by the first defendant was reasonable in the circumstances: [16]. However the the plaintiff’s position in expressing his desire not to attend an interview was also reasonable: [23].

At [32] the court concluded:

Whilst it may be accepted that the application raises complex issues and a difficult balancing exercise, on balance I am persuaded that the just determination of the cause in these proceedings should not require the plaintiff to attend a further examination by a psychiatrist. In reaching that conclusion, I have regard to the comprehensive manner in which the existing psychiatrists have addressed the issues raised for their attention.

Delayed treatment of bacterial meningitis

Panagoulias v The East Metropolitan Health Service [2017] WADC 118 was a decision last week of the District Court of Western Australia.

The  claim alleged delayed treatment of bacterial meningitis which developed following surgery for removal of a brain tumour. The claimant succeeded against the first defendant (the health service).

The decision focuses on the particular facts of the matter, however some aspects of the judgment are of broader interest:

  • Reference to therapeutic guidelines (at [133]ff).
  • Competent practice (at [348]) where the trial judge stated that “there is an air of unreality in trying to justify anything not done by the staff of RPH on the basis of some alternative ‘competent professional practice’ ‘widely accepted by the health professional’s peers’..”.
  • Causation and the drawing of inferences about the timing of treatment and probably outcomes in the absence of causation evidence served by the first defendant (at [457]).
  • Care in a private residence or a care facility (at [572]ff).

Refusal of consent for pregnancy termination

QBD [2017] QCAT 280 is a recent decision regarding an application for consent to ‘special health care’ being a twin pregnancy termination at 20 weeks gestation for a 33-year-old woman with a history of mental illness (schizophrenia) and illicit substance abuse resulting in admissions to mental health units for treatment.

At [19] the Tribunal accepted the medical evidence of Dr MA, consultant psychiatrist, who had been treating QDB. Dr MA’s evidence was that QDB lacked the capacity to make decisions. In relation to the decision to terminate her pregnancy, Dr MA said that QDB gave no reasons why she wants the termination and does not understand the nature and effect of the decision.

At [26] the Tribunal concluded:

We are not satisfied that the requirements under s 71 of the (Guardianship and Administration Act 2000 (QLD) …have been met. More importantly, that there is not evidence before us of serious danger to QDB’s life or physical or mental health if the pregnancy was to continue and therefore consent to termination of pregnancy cannot be given.

And at [30] – [33]:

[30] Dr MA’s evidence is that there is improvement in QDB’s mental health and at this point, as the pregnancy progresses and QDB is improving with treatment, he cannot say there is a serious danger to her mental health up to the end date of her pregnancy.

[31] Dr MA’s evidence is that it is not clear whether or not QDB will develop significant postnatal depression. Dr MA’s evidence effectively remained unchanged when he was questioned about the termination procedure and the likely impact that may have on QDB’s mental health. Dr MA’s evidence is that QDB’s illness is improving with treatment and follow up and stressors can be managed. Dr MA did not consider that QDB was at risk of significant self-harm in response to another opinion expressed about concerns of self-harm if the pregnancy were to continue. We accept Dr MA’s evidence. We are also not satisfied, having considered the views of other interested parties at the hearing, that QDB has engaged in self-harm during this pregnancy.

[32] It is open to us to find, based on the evidence before us, that any high risk to QDB’s physical health if the pregnancy were to continue is speculative because it requires a number of things to occur which do not amount to serious danger. The high risk to QDB’s physical health is premised on several factors that, although carry a degree of risk as we have found in this high-risk pregnancy, requires QDB to disengage from services and supports and/or to develop one of the complications of pregnancy that have been outlined.

[33] As we have said, these risks are in themselves speculative, and the physical risks alone are the normal dangers of this type of pregnancy and childbirth. We have found that QDB’s mental health has improved. We cannot be satisfied that the termination is necessary and, in the circumstances, consistent with Davidson’s case, ‘would be out of proportion to the danger to be averted’ [emphasis added].

With thanks to Associate Professor Tina Cockburn for noting this matter.

Seminar: Complaint patterns – Medical and legal practitioners compared

On Monday 16 October 2017 the NSW Law Society is hosting an panel session on a topic of interest to lawyers, doctors and their insurers. Including reference to soon to be published research, the panel will discuss similarities in complaint patterns for medical and legal practitioners and the implications of this for their regulators,  in predicting / minimising the risk of recurrent complaints.

The panel will consist of:

Associate Professor Dr Marie Bismark, Senior Fellow, Law and Public Health Group, University of Melbourne.
Dr Jennifer Moore, Senior Lecturer, University of NSW Law
Mr John McKenzie, Legal Services Commissioner
Professor Michael Hollands member of the Medical Board of Australia’s expert advisory committee on revalidation, former RACS president.

Attendance at the seminar can be booked online here.

Australian Consumer Law claim

Although not a medical claim, Moore v Scenic Tours Pty Limited (No 2) [2017] NSWSC 733 may be useful as a precedent for claims under the Australian Consumer Law in respect of section 60 and section 61, being statutory guarantee provisions (at [29]). It may have application to claims regarding medical services arranged in Australia but performed overseas.

The discussion of consumer guarantees begins at [305]. The consideration of ‘services’ commences at [350] and led to a finding at [378] that the promise of information and management services was an integral part of the Services supplied to passengers and was included in that term as it is used in the consumer guarantee provisions.

In relation to particular purpose, the trial judge said at [390] – [392]:

In in those circumstances, and in the absence of any direct evidence of the communication of any other particular purpose, I would readily conclude that when Mr Moore or any other intending passenger made a booking, paid the appropriate deposit, had their booking confirmed by Scenic for the identified cruise itinerary and with the selected cabin, and then in a timely way paid the balance of the itinerary price, Mr Moore was impliedly making known to Scenic that he and his wife wanted to enjoy the cruise upon which they had booked with all of the benefits which Scenic said that it would provide and that was the particular purpose for which the services were being supplied by Scenic.

It is to be noted that in the legislation the “particular purpose” stands independently of and precedes the “supply of services”. It arises and is communicated at the time of the acquisition of, but prior to, the supply of the services. As well, it is relevant to note that the purpose is a unilateral one of the consumer. It is not necessarily a purpose which must be explicitly agreed, nor does the purpose necessarily form part of a contract for the supply of services. Indeed, in many cases it will not.

It is also worth noting that the particular purpose does not have to be an objectively reasonable one. The ACL simply provides that if a particular purpose is made known, and the supplier of services goes on to supply those services knowing (either expressly or impliedly) of that purpose, then the purpose guarantee is brought into effect.

In relation to the ‘result guarantee‘ the trial judge said at [404] – [405]:

However, I am well satisfied, as with the implication of the “Particular purpose” to which I have earlier referred, that Mr Moore, by receiving the assurances and enticements of Scenic in its Brochure, selecting a particular identified cruise, and then paying for the cruise, was impliedly making known to Scenic the result which he wished the Services to achieve.

It seems to me to be a matter, largely, of common sense that passengers who booked on the cruises which Scenic promoted and would provide, were impliedly communicating that they expected the result from the Services which Scenic assured them they would get.

On the issue of the section 60 guarantee of due care and skill, the trial judge was required to consider the potential application of sections 5B – 5C of the Civil Liability Act and held at [422] – [433]:

The provisions of ss 5B and 5C of the CLA are relevant to the question of whether a person is, or is not, negligent. Although the sections are to be found under the heading to Part 1A – Duty of Care, the sections in fact relate to breach of such duty: Adeels Palace Pty Ltd v Moubarak [2009] HCA 48; (2009) 239 CLR 420 at [13]. Section 5D of the CLA deals with causation of loss.

The provisions of ss 5B and 5C are not picked up and applied by virtue of s 275 of the ACL because before that section operates, there first has to be a failure to comply with a guarantee. The provisions are sought to be applied here to the question of whether or not there has been a breach of the guarantee. Accordingly, they are not picked up by s 275. This conclusion is consistent with the reasoning of the Court of Appeal with respect to the predecessor to s 275 of the ACL, namely, s 74(2A) of the Trade Practices Act 1974 (Cth): see Motorcycling Events Group Australia Pty Ltd v Kelly [2013] NSWCA 361; (2013) 86 NSWLR 55 at [34] per Basten JA; at [46] per Meagher JA and at [144] per Gleeson JA.

However, the defendant submitted that these sections are picked up and have effect by reason of the application of s 80 of the Judiciary Act 1903 (Cth). The commencement point of this analysis is that this Court in hearing and determining these proceedings is exercising Federal jurisdiction pursuant to s 39(2) of the Judiciary Act because the Court is determining a claim which arises under Federal law, namely, the ACL.

Thus, the law which governs the exercise of that Federal jurisdiction is to be identified in accordance with ss 79 and 80 of the Judiciary Act. Although the claim of Mr Moore and the group members is brought for a breach of Federal law – ss 60 and 61 of the ACL – the failure to comply with s 60 is a failure to act with due care and skill, a notion commonly described as negligence. The ACL does not prescribe any standard for, or criterion to be considered by a court when determining whether a defendant acted without due care and skill. This has the consequence by application of s 80 of the Judiciary Act that the common law “… as modified … by the statute law in force in the State … in which the Court … is held” governs this Court’s exercise of Federal jurisdiction.

Sections 5B and 5C of the CLA modify the common law of negligence – so much is explicit from the words used. Accordingly, I conclude that the defendant’s submissions ought to be accepted. This result is consistent with the Court of Appeal’s decision in Motorcycle Events Group at [34] per Basten JA; [46] per Meagher JA and [150]-[151] per Gleeson JA.

The provisions of s 5B of the CLA require the identification of a risk of harm. Neither party specifically addressed this in submissions. Identification of the risk of harm is an essential step in the proper application of this provision: Garzo v Liverpool/Campbelltown Christian School [2012] NSWCA 151 at [22]; Shoalhaven City Council v Pender [2013] NSWCA 210 at [55]-[72]; Uniting Church in Australia Property Trust v Miller [2015] NSWCA 320; (2015) 91 NSWLR 752 at [100]-[128]; Fairall v Hobbs [2017] NSWCA 82 at [75]-[76].

It seems clear that the application of care and skill was required in the supply of the Services in order to avoid the risk of Mr Moore (and the group members) suffering financial harm by way of economic loss and harm by way of disappointment and distress if the Services were supplied without care and skill.

The first condition imposed by s 5B of the CLA is whether such risk was foreseeable – that is, whether it was known to Scenic or which Scenic ought to have known. I am satisfied that this risk of harm was known to Scenic at all material times. After all, Scenic encouraged all intending and booked travellers to take out travel insurance to cover, inter alia, expenses related to the cancellation of cruises, and as well, disruption of the cruises.

As well, since the proceedings in Baltic Shipping Co v Dillon [1993] HCA 4; (1993) 176 CLR 344, which were widely publicised and which were of interest to all providers of cruises, I would be prepared to infer that Scenic had actual knowledge of the risk that Mr Moore and the group members would be likely to be distressed and disappointed if the Services were not supplied with due care and skill. Indeed, there are expressions by Scenic to its passengers, particularly after the cruises were complete, which would lead to the same conclusion. If Scenic did not actually know of the risk of harm (contrary to my finding) then it clearly ought to have.

The next matter is whether the risk of harm is not insignificant. I have previously described a principled approach to the determination of this element: see Benic v State of NSW [2010] NSWSC 1039 at [101]. I see no reason to depart from this approach. I am satisfied that the risk of harm here was not insignificant. It is not at all uncommon that disruptions in, or cancellations of, cruises will occur and be accompanied by additional cost and expense. The risk is not so low as to fall below the threshold as fixed by s 5B(1)(b) of the CLA.

The question of whether on any particular cruise, Scenic should have taken certain precautions so as to ensure that the Services were provided with due care and skill will depend upon the particular facts and circumstances of the cruise.

Against the possibility that the question of whether a breach of the due care and skill guarantee ought be judged by the common law, unmodified by the CLA, I should say that the application of the Shirt calculus: see Wyong Shire Council v Shirt [1980] HCA 12; (1980) 146 CLR 40 at 147 per Mason J, would derive the same conclusions as I have just expressed.

As to defences to the guarantees including reliance, as noted at [434] – [435] section 61(3) makes references to circumstances that 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. The onus of demonstrating that any particular claim falls within s 61(3) falls onto the defendant.

The second defence relied upon by Scenic wa that referred to in s 267(1)(c)(ii) of the ACL. That section provides, with respect to the guarantees under s 61(1) and s 62(2) but not with respect to the due care and skill guarantees under s 60 of the ACL, that a consumer may take action under the section if the failure to comply with a guarantee did not occur only because of circumstances independent of human control that occurred after the services were supplied (at [440]). At [447] – 451] the trial judge concluded:

It cannot be doubted that flooding and/or the unseasonal rains which caused the high water levels and river infrastructure damage would be regarded as a cause that was independent of human control. But having regard to the way in which Mr Moore (and the group members) articulated their claim, this is one, but not the only, cause of the failure by Scenic to comply with the relevant consumer guarantees.

The other causes of the failure to comply with the purpose and result guarantees were entirely within the control and influence of Scenic. At the most basic level of Mr Moore’s claim is the assertion that Scenic was in breach of the purpose and result guarantees by failing to cancel the cruise or defer its departure. Another reason why Mr Moore claims a failure of the guarantee is that Scenic decided to transfer the passengers by motor coach for very long trips, in circumstances when the motor coaches were not of an adequate quality, or else where drivers were not properly instructed. Mr Moore also drew attention to the inadequacies of the docking locations for some of the ships – they were not proximate to towns, were in smelly industrial areas, and ships were docked between or adjacent to their ships. There is simply no evidence led by Scenic, or otherwise, which explains why the ships were docked where they were in Bamberg, Melk and Krems, whether the docks were chosen only because of the high water levels, damage to river infrastructure or for some other reason that was not explained by Scenic by evidence or in any document tendered in evidence.

It is inappropriate to go through and address the various individual failures which contributed, in different ways, to the experiences of passengers on each cruise as Scenic submits. This is because the question of whether the cruises achieved their objective and provided the Services so as to comply with the purpose and result guarantee is an evaluation made on the basis of examining all that was provided, and assessing it against what services ought to have been provided.

I am satisfied that the failures of Scenic relied upon by Mr Moore and the group members, were not caused only by circumstances outside human control.

Accordingly, this defence has not been made out by Scenic with respect to the purpose and result guarantees.

The trial judge went on to apply the above to each of the relevant factual circumstances and at [761] – [765] concluded that there had been a breach of the guarantee:

What Scenic here did was to make decisions about the provision of the Services which involved, speaking generally, significant time periods and distances of substitution of motor coaches travelling on roads for river cruises on rivers, requiring passengers to unpack and pack on a number of occasions to take accommodation either on static ships which were in some locations docked in unpleasant locations, or else in hotels, some of which did not meet an appropriate standard or quality, and to supply a range of services which did not match the promised services, even allowing for an adequate meaning to be given to the terms and conditions of the contract.

Supplying a 13½ hour motor coach trip on roads instead of a river cruise is not the supply of a nature or quality of services that might reasonably be expected to achieve the Result. Requiring passengers to pack and unpack luggage and provide it for an early morning departure, could not reasonably be expected to achieve the desired result.

But to approach each of these cruises by taking one such example, would be to adopt less than an overall approach which, in my view, is what is required, having regard to the nature of what was promised and the terms in which the services were promised.

There is no need to examine each cruise, and the facts of each cruise, again because as is apparent from the analysis with respect to the purpose guarantee, the same conclusion will be reached with respect to the result guarantee, as was reached with respect to the purpose guarantee for each cruise.

In those circumstances, Scenic, with the exception of Cruises 10 and 12, were in breach of the result guarantee by not providing services of a nature and quality that might reasonably be expected to achieve the Result.

As to damages, the court held that there had been a major failure to comply with the guarantees (at [779]) and proceeded to deal with damages. Importantly the court considered the interpretation of section 275 and corrected an earlier court error in at [872] – [873]:

No party in these proceedings suggests that the provisions of Pt VI B of the Competition Act, in which s 87M is to be found, apply to these proceedings. That is because the provisions of s 87E of the Competition Act, which purports to apply Pt VI B of that Act to a range of proceedings, does not include claims arising from a failure to comply with the consumer guarantees set out in Pt 3.2 of the ACL, or claims that are made pursuant to Div 1 of Pt 5.4 of the ACL.

I conclude that the claim made by Mr Moore for damages for distress and inconvenience under s 267(4) is, subject to the issue of extra-territoriality which is dealt with below, otherwise caught by the provisions of Pt 2 of the CLA. The evidence does not establish that the extent of Mr Moore’s disappointment and distress could reach the minimum threshold fixed by s 16 of the CLA and, accordingly, this claim must fail because the Court could not make any award of monetary damages.

As regards extra-territoriality, the court held that the Civil Liability Act did not in the circumstances have an extra-territorial effect, at [908] – [911]:

Accordingly, I conclude that the CLA was not intended to, and does not have, any extraterritorial effect. This conclusion is not inconsistent with that reached by the High Court in Insight Vacations.

Accordingly, I am satisfied that where the events giving rise to an entitlement to damages happened outside of NSW, as did Mr Moore’s damages for distress and inconvenience, Pt 2 of the CLA does not apply to such a claim.

Mr Moore’s distress and inconvenience upon which his damages claim is based, arose outside of NSW because the failure to comply with the consumer guarantees occurred when Mr Moore’s cruise experience suffered the major failure which I have earlier described. That failure occurred overseas. Mr Moore, in the course of that failure, suffered disappointment and distress. Those feelings were suffered overseas and as a consequence of the overseas events.

As Pt 2 of the CLA does not, in my view, apply to the claim by Mr Moore for damages, any award which I make on this claim will not contravene the provisions of s 11A which restrict the jurisdiction of this Court in the awarding personal injury damages contrary to Pt 2. That is because Pt 2 does not apply to Mr Moore’s claim. Any award of damages on that basis is not contrary to the Part, because the Part has no application.