Quadriplegic wins High Court Tatslotto jackpot

I see that the High Court has allowed an appeal from the NSW Court of Appeal in a matter called Swain v Waverley Municipal Council, thereby effectively restoring the original jury verdict that had awarded Swain damages of $3.7 million for injuries sustained when he dived into a sandbank between the flags at Bondi Beach and rendered himself a quadriplegic. Swain is now a big winner in the tort lottery, although whether it’s much consolation to him in his wheelchair is unknown.

A bare majority of three (Gleeson CJ, Gummow and Kirby J) held that there was enough evidence for a jury to be able to conclude (if so minded) that Waverley Council had been negligent, and that the Court of Appeal had impermissibly substituted its own opinion of what swimming flags on a beach meant for that of the jury. The minority (McHugh and Heydon JJ) concluded that there was simply no evidence to allow a jury to properly conclude that the Council beach inspector had any other practical choice (or at least any safer choice) in placing the flags than to put them where he did.

For local councils and surf lifesaving clubs, the High Court’s decision presents a major headache. As a professional lifeguard on Sydney’s northern beaches for several seasons during my younger days, I reckon I’m reasonably well-qualified to comment on the factual situation as well as the law. Any surf beach consists of alternating sandbanks and gutters or rips. It’s a formation necessarily created by wave action. Swimming flags are most safely placed where a sandbank is, and away from major gutters and rips. Placing flags where rips and gutters are located may result in swimmers being swept out to sea and drowned. Hence you have no practical choice but to place flags delineating a sandbank area, even though some of the water covering the sandbank will be very shallow so that there’s a theoretical possibility that some dickhead (like Swain – who had consumed several beers immediately before swimming and an ecstasy tab the previous evening) might dive too deeply and ineptly into an oncoming wave and hit his head on the sandbank. However, the majority reasoning in Swain seems to proceed on the basis that there is (or at least might be) some other spot on the beach where the flags could safely have been located. Presumably they were thinking about some place where there is neither a rip nor a sandbank. But on a surf beach there is no such place.

Moreover, the majority reasoning proceeded on the basis that the plaintiff had merely to suggest the possibility that there might have been a safer place for the flags, and that the burden of proof then instantly shifts to the defendant Council to disprove that possibility!! As McHugh J discusses, this is legal and logical nonsense, but it’s nonsense that is now part of the Australian common law.

The decision in Swain leaves councils and surf clubs with a classic Hobson’s Choice. Should they place flags adjacent to a rip and get sued by people who get swept out to sea, or on a sandbank and get sued by idiots who dive deeply without checking the water depth or holding their hands in front of them? If the decision was mine, I’d simply give up completely the practice of putting out swimming flags, and retire to the clubhouse until governments legislate to overcome the effect of this absurd High Court decision.

For those wanting a cogent, sensibly reasoned approach to the issue, I recommend McHugh J’s judgment, and in particular the following passages:

In the present case, it was probably open to the jury to find that, on this day, swimming or bodysurfing between the flags at Bondi Beach exposed the swimmer to a risk of injury that was reasonably foreseeable. The risk arose from the possibility that, if the swimmer dived through a wave in an area about 15-25 metres from the shore, the swimmer might strike an unseen sandbar. I say that it was probably open to find that that risk was reasonably foreseeable because there was no evidence as to how long the risk had existed. For all that the evidence disclosed, the risk might have been confined to only a small part of the flagged area and might have existed only for a short period. If the risk had only recently arisen, the appellant would have had the difficulty at trial of showing that the Council should have known of the risk and taken immediate action to avoid it. Assuming, however, that there was a reasonably foreseeable risk of injury to the appellant, there was no evidence whatsoever that there was a reasonably practicable means available to avoid it. There was no evidence that the risk was not also present at other parts of the beach outside the flagged area or that there were parts of the beach within the flagged area that did not have the same degree of risk. There was no evidence that other parts of the beach were free from other dangers associated with swimming and could have been safely used by swimmers including the appellant. Indeed, the fact that the flags directed bathers to swim between them strongly indicates that areas of the beach outside the flagged area were more dangerous than the part of the beach within the flagged area. Furthermore, in this Court the appellant accepted that reasonable care did not require the Council to warn him of the danger of striking the sandbar. And no-one, not even counsel for the appellant, suggests that, on this day with a calm surf running, a reasonably practicable alternative means of eliminating the risk would have been to close Bondi Beach or even the flagged area where he swam. …

The fundamental difficulty in the way of Mr Swain’s case is that there was no evidence that the areas to the north or south of the flagged centre area were safer than the flagged area. Nor was there any evidence that a portion of the flagged area did not have as high a risk of injury from the sandbank, rips and guttering as existed at the point where Mr Swain suffered his injury. Mr Nightingale was not asked whether there was a safer place to put the flags. Indeed, there was no direct evidence about whether there was a safer place to put the flags. The very fact that the flags were placed where they were points strongly to the conclusion that the areas to the north and to the south of the flagged centre area were more dangerous than the area between the flags. Moreover, there was no evidence about the conditions to the north or to the south of the flagged area where Mr Swain swam. Nor was there any evidence about the conditions of the flagged area other than what can be accepted or inferred from the evidence of Mr Swain, Mr Wilson and Ms Galvin. Hence, there was no evidence whether the channel and sandbank between the flags ran along the whole length of the beach. However, it seems unlikely that they did so. The evidence indicated that, on a beach such as Bondi, the typical formation of the beach would have been a rip, a sandbar, a rip, a sandbar. A jury could infer – although it does not help Mr Swain’s case – that there would have been other rips and other sandbars along the beach on the day in the formation of a rip, a sandbar, a rip, a sandbar. In light of the evidence about the variable dimensions and locations of channels and sandbars, no inference could be drawn about the locations or dimensions of any other channels and/or sandbars at Bondi on the day. There was, as I have indicated, evidence that the North Bondi area was marginally safer than the area in the centre of the beach. There was also evidence that the South Bondi area was more dangerous than the centre area. And there was evidence that a beach such as Bondi typically consists of a series of channels and sandbanks and that the channels and sandbanks vary from day to day and during the course of the day. A reasonable jury could infer from this evidence that the location and dimensions of channels and sandbars are not uniform, that there probably would have been other channels and sandbanks outside the flagged area, and that the dimensions of these channels and sandbanks would vary. But it would be sheer speculation to infer from any of this general evidence that the sandbanks and inevitable channels to the north and south of the flagged area would not have exposed swimmers to the same, similar or other risks of injury as the centre area did. No inference could reasonably be drawn that the channels and sandbanks outside the flagged area in the centre of the beach would have been any smaller or would have exposed swimmers to a lower risk of injury than the channel and sandbank where the accident occurred. Nor could any inference be drawn that, within the flagged area, there was an area where swimmers could swim without running risks of injury. Just as no inference could be drawn that the “ditch or hollow” extended uniformly along the whole of the channel in the flagged area, no inference could be drawn that it did not so extend.

As I have indicated, a plaintiff is required to identify an alternative means of eliminating a risk and to provide evidence that the alternative is indeed a practicable one. The plaintiff may be required to lead more evidence (or perhaps technical or expert evidence) as to an alternative and the feasibility of that alternative where the defendant has followed a generally accepted practice – which the Council had in this case. The plaintiff is also required to adduce technical or expert evidence concerning the practicability of the alternative unless it is one where common knowledge or common sense is all that is required to prove the reasonably practicable alternative. However, this was not a case where the jury could use its common knowledge or experience to find that the flags could be moved to another area of the beach because there was no evidence concerning the conditions of the surf and the seabed at other parts of the beach on that day.

As a result, Mr Swain’s evidence did not disclose whether it would have been reasonably practicable to move the flags from that part of Bondi Beach on the day to another part of the beach. As the cases show, where a suggested alternative carries its own risks, the plaintiff is required to provide evidence that these alternatives would have been practicable. Moving the flags would have carried its own risks to the safety of swimmers. Mr Swain did not suggest that the beach itself should have been closed or even that the flagged area in the centre of the beach should have been closed. Nothing short of expert evidence to that effect could have enabled the jury to find that closing the beach or its centre area was the only reasonably practicable way of responding to risks arising from the size and shape of the sandbank that caused Mr Swain’s injury.

Counsel for Mr Swain boldly contended that he did not need to tender evidence that there was a reasonably practicable precaution that would reduce or eliminate the risk of injury to Mr Swain. He contended that Mr Swain was “entitled to succeed if we can demonstrate that it is apparent that by a simple manoeuvre, that is, moving the flags, the problem may be resolved.” He argued that it was then “for the [Council] to deal with that by coming along and saying, ‘Could not do it’, and that did not happen.” This submission reverses the onus of proof in a negligence case. …

Quite so. But that’s what the majority in the High Court has now done. Although it might be a triumph of social justice (at least for Mr Swain), this case is not the High Court’s finest hour in terms of sound legal reasoning or even basic commonsense

About Ken Parish

Ken Parish is a legal academic, with research areas in public law (constitutional and administrative law), civil procedure and teaching & learning theory and practice. He has been a legal academic for almost 20 years. Before that he ran a legal practice in Darwin for 15 years and was a Member of the NT Legislative Assembly for almost 4 years in the early 1990s.
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Rob
Rob
2021 years ago

Jesus, Ken, who said the law wasn’t an ass?

Reminds me of a case I read when I was in the Victorian Law Department years ago. A widowed man married a new wife. Soon after, his mother cut him out of her will. Later, she died. He contested the will through all the legal processes – before a Master, before a single Judge, then before the Full Bench of the Supreme Court: he lost all of them. Then he got a hearing before the High Court. Justice Murphy (remember him?) delivered the majority opinion. Finally, someone showed some ordinary common sense. It’s quite clear, said Murphy, that the mother hated her new daughter in law, and wanted to punish her son for it. The court found for the plaintiff, and awarded him costs.

But what do you know? The trustee company defending the will was drawing on the assets of the mother’s estate to do so. So when the trustees had to pay the costs, they had to sell his estate – the one he had been contesting for! – in order to meet the court’s order.

So he lost everything he was fighting for by winning in the courts.

(You may know this case better than I and I defer to your more expert knowledge.)

David Tiley
2021 years ago

Is it a defence for councils to put up a notice?

Ken Parish
Ken Parish
2021 years ago

David

As the extract from McHugh J mentioned:

“in this Court the appellant accepted that reasonable care did not require the Council to warn him of the danger of striking the sandbar.”

Mork
Mork
2021 years ago

Reading the judgments, it’s not too hard to work out which of the high court judges has been to a beach before and who hasn’t!

(BTW – I have an idea that Michael McHugh is a resident of the Waverly Council area and therefore a ratepayer … is that a conflict? I guess not.)

I wonder: would the judges in the majority have any sense at all that 90% of people who learn of this result will think that it is absurd on its face, and many will take it as adding weight to a fiercely negative view of the judiciary. If so, do they care? Should they?

AlanDownunder
AlanDownunder
2021 years ago

I’d also side with the minority and I’m also glad the plaintiff won. We can only say something so stupid because our accident compensation system is so ridiculous.

New Zealand has seen the light — by adopting the recommendations of an Australian study. Universal no-fault cover coupled with continuously assessed (rather than lump sum) compensation beats tort law plus insurance hands down.

Australians can’t pass around the hat? Since when?

Dave Ricardo
Dave Ricardo
2021 years ago

“(BTW – I have an idea that Michael McHugh is a resident of the Waverly Council area and therefore a ratepayer … is that a conflict? I guess not.)”

Indeed, McHugh’s wife Jeannette represented the area in the Federal Parliiament , and her former political associate Paul Pearce is the Mayor of Waverley and represents the area in the state parliament.

Not that this would have affected McHugh’s judgment. His integrity is unquestioned, and rightly so. But it’s a small world.

Ken Parish
Ken Parish
2021 years ago

Kirby J lives around the general area too, although it’s conceivable that both he and McHugh J might actually live in Woollahra Municipality rather Waverley. I’m not sure about Gleeson or Heydon or Gummow. As Dave rightly concedes, even if they did it isn’t a conflict of interest (not least because the council’s public liability insurer picks up the tab, and the inevitable premium rises that will flow from the HC result will be borne by every seaside council in Australia, not just Waverley).

Ken Parish
Ken Parish
2021 years ago

Further to a query by David Tiley above, I should note that the tort law reforms introduced in NSW (and other states) a couple of years ago included provisions allowing for liability to be reduced or avoided if risk warnings are given. However (although it’s not realy my area), I think they’re mostly aimed at commercial recreation activity providers, who can more easily ensure that the warning is brught to customers’ attention at point of sale. It would be much harder for a local council to implement a really effective system of risk warnings on a large beach.

However, the tort law reforms also capped liability in various ways, and I’m sure that Swain would have recovered quite a bit less (although still a substantial amount) if his accident had occurred after the reform legislation was enacted.

Personally, I reckon a no-fault universal compensation scheme, like that in New Zealand, would be a much better solution. Benefits to individuals would be substantially lower than the windfall Swain has just won, but at least everyone would get coverage irrespective of whether they could find someone with money or insurance to sue. I’ll try to blog something more detailed on this aspect tomorrow.

Ron
Ron
2021 years ago

According to tonight’s news, this will be the last of this sort of payout because of Carr’s recent changes to the NSW compensation laws.

The only beneficaries now will be the insurance companies. The losers: the injured and compensation lawyers.

Alan
Alan
2021 years ago

Actually, the capping laws were passed in most jurisdictions. I’m surprised it hasn’t fed into the US debate on tort reform where the issues are fairly similar.Despite the cap on liability, there’s no sign of any reduction, let alone any cap, on insurance premiums.

observa
observa
2021 years ago

“I reckon a no-fault universal compensation scheme, like that in New Zealand, would be a much better solution.”

Of course we do have a no fault compenstion scheme in place at present ie largely Centrelink and Medicare. Now we may not be happy with the level of that compensation, but it would be hard to argue that the diver in question, is worth more special compensation than say a degeneratively diseased wheelchair bound, Disability Pensioner. When the legal fraternity take it upon themselves to override ordinary common sense(ie look before you dive)and decide to specially compensate dickheads from the public purse via our insurance premiums, they will no doubt, have to wear the community outcry. The politicians will come hot on the community’s heels.

Overall no fault compensation would suffer the drawback of little incentive(barring criminal penalties)for ‘reasonable’ duty of care. As an employer paying Worker’s Compensation premiums, I would naturally prefer not to pay them, particularly if I had incurred a high rate due to high claims experience. Presumably these along with motor vehicle third party premiums, etc, would all be rolled into a no fault scheme? How big the public hanky is and who’s gonna pay will be the $64,000 question.

observa
observa
2021 years ago

Alan, there is a natural cap on insurance premiums and it’s called competion. If you think you can set up an insurance company that can offer cheaper premiums and still make a ‘normal’ profit, you’re free to. OTOH I don’t see too many investors charging into the insurance market to take advantage of any ‘supernormal’ profitability in this specific industry, over the long term. That is not to say that premiums and profitability do not fluctuate in the short term, due to things like share market returns and Court decisions like this one.

dgj
dgj
2021 years ago

1. agree decision appears incorrect;
2. i’m glad he got some money and i think it’s a bit harsh of you to call him a dickhead. Is this because he had 3 beers? His eating a pill the night before seems irrelevant.
3. A no fault scheme is a good idea, but it’s a pity the new laws have eroded our ability to make negligent businesses (and their insurers) pay for their decision to expose people to undisclosed risks.
4. Increased premiums should not inevitably flow from this decision, since it relates to the old law.

Mork
Mork
2021 years ago

There’s another slightly odd thing about the majority judgments: at least two of the judges made comments that seem to suggest that they thought that the Council’s case at the original trial was badly argued. Isn’t it a bit weird of them to imply that the jury would have have decided otherwise if the evidence had been presented in a more expert manner, but that they’re stuck with the result now? It doesn’t do much for one’s confidence in either the jury system or appellate courts!

Observa wrote: “OTOH I don’t see too many investors charging into the insurance market to take advantage of any ‘supernormal’ profitability in this specific industry, over the long term.”

Observa – you haven’t been looking hard enough. I’ve read plenty of research and commentary recommending insurance industry stocks over the last couple of years, for precisely this reason. And, although it’s not exactly related, Warren Buffet famously increased his investment in insurance right after 9/11, partly because assets were relatively cheap, but also because he worked out that premiums would rise on the back of the payouts without there being a corresponding increase in the risks that were being insured.

Ken Parish
Ken Parish
2021 years ago

dgj

The dickhead comment mainly related to the beers. Three beers in an hour immediately before going in the surf is a recipe for trouble. It would put him at least close to the blood alcohol level that makes it an offence to drive. His judgment and spatial awareness would certainly have been impaired to an extent. And he was also putting himself at risk of cramp and other consequences. As for the ecstasy the night before, I don’t know enough about the residual effects if any. It seems to suggest that he had a big night the previous evening with very probably insufficient sleep, which would again have impaired his judgment.

Maybe it was a bit harsh to call him a dickhead, given what happened to him and the fact that it’s hardly uncommon for people to do such things (however stupidly). But it seems quite clear to me that his misfortune flowed from his own beaviour and misjudgments. He’s mostly a dickhead because he’s trying (successfully with the High Court’s help) to blame others for his own errors and misjudgments. A common law system based on ascribing fault more or less channels thinking into paths of assigning blame (because that’s how you recover damages), so given that we’re discussing the outcome of such a case it doesn’t seem unreasonable to point out (even just for the sake of completeness) that there was evidence that would have enabled a jury to conclude that the accident was Swain’s fault and not that of the Council.

observa
observa
2021 years ago

Mork,
With the collapse of HIH who were clearly charging uneconomic long term premia, I too saw the opportunity to engage in the Promina float(really an amalgamation of a number of specialist insurers) and am doing very nicely with their share price now. However 2yrs is not the long term in the very long-tailed, liability insurance field. I haven’t heard of any real start-up insurance company floats in the past few years, have you? What does that tell you about how international capital views long term returns in the sector?

observa
observa
2021 years ago

Agree with Ken that we can all be a dickhead from time to time, yet still not deserve a particular outcome of that dickheadedness.

Ron
Ron
2021 years ago

“there is a natural cap on insurance premiums and it’s called competion”

Like the competition between banks and fuel companies?

I don’t think so.

dk.au
dk.au
2021 years ago

re: the ecstacy tab the previous night before
It’s hard to know exactly what’s in pills these days (I recall reading that MDMA contents range from 15mg to 400mg). Most studies have concentrated on the psychological, memory and visuospatial (ie. driving simulators – to find out whether it’s safe to drive home after raves) domains. I doubt there’s any evidence that coming down from a tab actually helped Swain assess risks, make sound spatial judgements, feel normal and act rationally – quite the contrary.

The way I see (from journal articles and my own experience) if Swain had a decent pill, he’d be feeling pretty edgy and run down the next day. Responsible users of any drug KNOW what’s in it, the effects – both acute and mid to long term – and what they should or shouldn’t be doing.

Add the beers, and I think the onus is squarely on Swain. Like an unroadworthy car stays in the garage, this guy should have been more careful, and made a better effort to swim conservatively.

observa
observa
2021 years ago

Ron, you answer your own rhetorical question here. You don’t like any degree of natural oligopoly(eg because of high entrance costs)so you seem to imply the answer is one great big monopoly. Now it is true that there are tradeoffs between private lump sum payouts and falling back on the Social Security net with insurance here. However, what mechanism would there be in a monolithic no-fault compensation scheme, to prevent the lazy and the shonky from driving a bus through it like the Disability Pension Scheme? What incentive do public servants have for trying to weed them out? We have a perfect example of the conspicuous indignation, that awaits any public officer who gets it wrong, with the Rau case. That’s why the States have ditched their govt Workcover schemes after making them public and handed them back to private enterprise, to do the necessary dirty work.

Sacred Commandment of the Lefty: I don’t like oligopoly so let’s all have a monopoly and then I’ll be happy! Yeah, riiiiight!

trackback
2021 years ago

Blog coward alert

Apology- off topic, but want to spread warning about an appalling breach of blog ethics by a well-known right wing site.