Perisher Blue Pty Ltd v Nair-Smith

1. [1]

   THE COURT: Perisher Blue Pty Ltd (“the appellant”) operates ski fields at Perisher. Dr Ghita Nair-Smith (“the respondent”) was skiing there on 18 July 2003 with her family and some friends. On boarding a moving chair forming part of the appellant’s triple chairlift, the respondent was struck in the groin area from behind by the armrest of the chair.

2. [2]

   The respondent claimed that the appellant was guilty of negligence in and about the operation of the chairlift and that that negligence of an employee of the appellant was causative of bodily injury sustained by her. She brought proceedings against the appellant in the Common Law Division of the Supreme Court and, after a trial that occupied eleven hearing days in August and September 2012, Beech-Jones J upheld her claim and awarded her damages of $1,368,700.

3. [3]

   His Honour delivered three judgments. In the first (Nair-Smith v Perisher Blue Pty Ltd [2013] NSWSC 727, 7 June 2013), he recorded his conclusion that the respondent was entitled to a verdict and gave detailed reasons for that conclusion. Certain matters required further argument before the amount of the verdict could be determined. The judge identified those matters and stood the proceedings over for directions.

4. [4]

   The second judgment (Nair-Smith v Perisher Blue Pty Ltd (No 2) [2013] NSWSC 1463, 4 October 2013) followed a further hearing on 9 September 2013. In that judgment, his Honour dealt with a constitutional law question concerning the statutory regime for the assessment of damages and set out conclusions as to amounts applicable to several heads of damages. The proceedings were further stood over for submissions on the calculation of interest and on costs.

5. [5]

   These remaining matters were determined by a judgment delivered on 27 November 2013 following the filing of written submissions: Nair-Smith v Perisher Blue Pty Ltd (No 3) [2013] NSWSC 1736.

6. [6]

   The appellant appealed. It contends that the primary judge made a number of factual errors and that he erred in both the formulation of the scope and content of the duty of care owed by the appellant to the respondent and in finding that negligence of one of its employees was a necessary condition of the state of affairs said by the respondent to have caused her injury. There are also challenges to elements of the assessment of damages. In addition, the appellant says that the judge erred in finding non-applicability of certain sections of the Civil Liability Act 2002 (NSW) by virtue of an implied contractual term under s 74 of the Trade Practices Act 1974 (Cth).

7. [7]

   Because much depends on matters of fact, it is necessary to deal in some detail with the judge’s factual findings and the challenges to them.

8. [8]

   The triple chairlift, as its name implies, consists of a series of chairs each of which is suspended from an overhead cable and can accommodate three persons sitting side by side. The chairs carry skiers from a loading station at a lower point on the mountain to a disembarkation station at a higher point on the mountain. The cable runs around large wheels called “bullwheels” at the top station and the bottom station and is constantly moving.

9. [9]

   The space between chairs rounding the bullwheel and approaching the loading point is such that, immediately after one loaded chair has departed, up to three skiers can position themselves at the loading point in a way that enables them to sit down on to the next chair after it has passed around the bullwheel and reached the loading point.

10. [10]

    If, as on the occasion in question, three skiers are to board, they stand on a transverse line marked on the snow at the loading point with their skis pointing in the uphill direction that the chair will follow. This line is known as the “load line”. They look behind for the approaching empty chair and, when it arrives, sit down on to it. They must, of course, be close enough together that all three are collected by the seat of the chair when it reaches them. The person on the right must be not too far to the right and the person on the left must be not too far to the left.

11. [11]

    Each chair has a rail in the nature of an armrest at each end. A safety bar, hinged at each side of the chair and running from one side to the other, is raised before persons mount a chair and is lowered by them after they are in position. It serves a safety purpose related to the possibility that persons seated in the chair may fall forward. When lowered, the safety bar is at roughly the height of the waists of the seated passengers and in front of them so that their hands may rest on it and, in due course, raise it immediately before they disembark. Persons waiting at the loading point cannot board a chair if its bar is down. This is because it is across the front of the seat and prevents anyone placing their body on it.

12. [12]

    On the day in question, the respondent boarded the chairlift with two friends, Mr Nowland and Mrs Nowland. All three were wearing skis. They made their way to the boarding point and positioned themselves on the load line. As they faced uphill, the respondent was on the right, Mrs Nowland was on the left and Mr Nowland was between them. An employee of the appellant, Mr Lofberg, was in attendance. His precise position and actions were the subject of dispute.

13. [13]

    Persons standing on skis at the boarding point waiting for a chair can, by looking to their left and slightly ahead, see empty chairs as they come downhill on the cable before turning 180 degrees on the bullwheel behind them and commencing the approach to the loading point for the next uphill journey.

14. [14]

    The respondent and her companions, having assembled on the load line, became aware that an empty chair to their left was approaching at the end of its downhill journey with its safety bar down – that is, in the position it would normally occupy in front of passengers who had boarded the chair and lowered the bar in front of them.

15. [15]

    Seeing that the bar of the approaching chair was down, the respondent and her companions called out to attract the attention of Mr Lofberg. He raised the bar of the chair. The three skiers then mounted the chair but the respondent did so in such a way that the armrest at the right hand end of the chair came between her legs and she was injured by its contact with her groin area.

Proceedings below

1. [16]

   The respondent brought proceedings for damages against the appellant in tort and contract in respect of the injuries she suffered. In her amended statement of claim dated 13 February 2009, the respondent particularised the appellant’s alleged negligence as follows:

   1. (1)

      The appellant failed to keep a proper lookout sufficient to allow it to detect that the safety bar was down before it entered the loading area.

   2. (2)

      The appellant’s servant failed to raise the safety bar in a timely manner.

   3. (3)

      The appellant’s servant handled the chair in such a way that he pulled it out of alignment with the respondent and her companions.

   4. (4)

      The appellant’s servant failed to stop or slow the lift so as to prevent it from impacting with the respondent and her companions or to give the appellant’s servant sufficient time to raise the safety bar.

   5. (5)

      The appellant’s servant allowed the respondent to proceed through the entry gate to the loading point even though he knew or ought to have known that the safety bar was down and that it was not safe for her to so enter.

   6. (6)

      The appellant’s servant:

   7. (7)

      The appellant’s servant, through his conduct enumerated at (6) above, failed to properly implement the appellant’s lift procedures.

2. [17]

   The respondent’s claim in contract alleged that the appellant was under an express contractual obligation to provide uphill transportation to her with reasonable care and skill. The obligation was said to be incorporated into the contract between the appellant and respondent by virtue of the writing on the respondent’s lift pass and the signage displayed in the vicinity of the point at which the respondent purchased her pass. The respondent submitted that her contract with the appellant also contained an implied term to the effect that the appellant was to provide transportation services to her with due care and skill by virtue of s 74 of the Trade Practices Act 1974 (Cth) as in force before the amendments made by the Trade Practices Amendment (Australian Consumer Law) Act (No. 2) 2010 (Cth). The respondent relied on the particulars detailed above in respect of her claim in contract.

3. [18]

   The amended statement of claim set out particulars of the respondent’s injuries allegedly occasioned by the incident. The respondent alleged that she suffered injury to her left vulva, back, right hip and right thigh; abrasion to the left portion of her left labium majus, bruising, anxiety, humiliation, shock and sequelae for which she sought damages for out of pocket expenses, domestic assistance or attendant care, loss of income and loss of earning capacity, and future economic loss.

4. [19]

   The appellant accepted that a duty of care was owed to the respondent but denied any tortious liability arising out of the incident. In the alternative, it submitted that the respondent was guilty of contributory negligence. Similarly, the appellant accepted that it was under a contractual obligation to provide its transportation services to the respondent with due care and skill but denied any breach of that obligation and argued that any liability was nevertheless excluded by virtue of indemnities appearing on the lift pass and on the signage located at the point of sale of the pass which it alleged were incorporated into the contract. The appellant denied that it was under an implied obligation to render its services with due care and skill by virtue of s 74 of the Trade Practices Act because that section was rendered inapplicable by ss 68A and 68B. In any event, the appellant argued that the means of establishing a breach of the term implied by s 74 and of calculating the respondent’s damages in respect of any such breach were governed by Parts 1A and 2 of the Civil Liability Act 2002 (NSW). The respondent alleged that the Civil Liability Act did not apply because it was inconsistent with s 74 of the Trade Practices Act and was accordingly (and to the extent of the inconsistency) invalid by virtue of s 109 of the Constitution.

Issues before the primary judge

1. [20]

   The following issue arose for determination before the primary judge for the purposes of his first judgment:

   1. (1)

      The manner in which the accident happened.

   2. (2)

      The nature and extent of the appellant’s contractual obligations; to what extent, if any, the appellant breached any of those obligations and to what extent, if any, was the appellant indemnified under the contract in respect of any such breaches.

   3. (3)

      The nature and extent of the appellant’s duty of care in tort, whether the appellant breached that duty, whether any potential breaches were causative of the respondent’s loss for which she was seeking damages, whether the manner in which Mr Lofberg comported himself constituted a materialisation of an inherent risk involved in the activity of loading onto chairlifts, whether the accident constituted an obvious risk involved in a dangerous recreational activity, the sufficiency of the appellant’s risk warnings and whether the respondent was contributorily negligent in respect of the injuries she sustained.

   4. (4)

      Whether s 74 of the Trade Practices Act was applicable to the contract between the appellant and the respondent in light of ss 68A and 68B and, if applicable, whether the appellant breached the term it implied into the contract to render lifting services with due care and skill.

   5. (5)

      The factual issues relating to the respondent’s claim in damages.

Findings of the primary judge

1. [21]

   The primary judge made the following findings in relation to the manner in which the accident happened. The respondent and her companions were properly aligned immediately after arrival at the loading point. Mr Lofberg was positioned “no closer to the loading point than the exit point of the bull wheel”, when the skiers assembled at the loading point. He noticed the state of the bar (that is that it was down) “late” when his attention was drawn to that fact by the calls of the respondent and her companions. By the time Mr Lofberg raised the bar, the front edge of the chair was within 300mm of the skiers. When he raised the bar, he acted in a hurried way but did not push the chair. His manner of raising the bar caused the skiers to panic and shuffle, which in turn caused the respondent to move out of correct alignment. The misalignment resulted in the respondent being struck by the chair’s armrest as it came past the loading point. The expert evidence established that the dynamics of the chair were such that it could not have been pulled out of alignment by Mr Lofberg to the skiers’ right and then swung back to the left of the skiers in the time available, as alleged by the respondent.

2. [22]

   In relation to the appellant’s contractual liability, the primary judge made the following findings. The contract between the appellant and respondent did not incorporate any of the terms printed on the respondent’s lift pass or on the signs located at the point at which the respondent purchased her lift pass. The contract contained a term implied by s 74 of the Trade Practices Act that the respondent would provide its transportation services with due care and skill, which term the appellant breached by failing to have a lift operator near the loading point observing chairs as they left the bullwheel so as to enable him to raise any safety bars that were down in a timely manner. The primary judge arrived at this conclusion on the basis of the reasoning he applied to the respondent’s claim in negligence. He added that, even if certain sections of the Civil Liability Act relied on in relation to the respondent’s claim in negligence did not apply to the respondent’s claim in contract by virtue of being inconsistent with the Trade Practices Act, the respondent’s Trade Practices Act claim would nevertheless succeed.

3. [23]

   With respect to the respondent’s negligence claim, the primary judge found (at [129]-[130]) that the appellant owed the respondent a duty of care to exercise “reasonable care and skill in respect of the her [sic] safety and in operating the chair and to allow her to safely utilize the chair”. He identified the relevant risk as “the risk of physical harm resulting from a chair arriving at the loading station in a state not suitable for boarding”. There was a foreseeable and not insignificant risk that a chair would arrive at the loading station with its safety bar in the down position. In the circumstances, a reasonable person in the position of the appellant would have taken the precaution, not taken in the present case, of “having a ski operator near or close to the loading point observing, at the very latest, the state of the chair as it exits the bullwheel”. The taking of this precaution would have “enabled Mr Lofberg to raise the bar in a ‘timely manner’”. In light of the probability and likely seriousness of the harm that may result from failing to take this precaution, the burden of taking it and the social utility of having lifting services provided to skiers, the primary judge held that the appellant’s failure to take the identified precaution constituted a breach of the duty of care it owed to the respondent.

4. [24]

   The primary judge found that the failure to take this precaution resulted in Mr Lofberg having to lunge or dive at the chair in a rushed manner, which caused the respondent and her companions to panic and jostle so that the respondent was displaced from her original position of alignment with the chair. It was in this way that the appellant’s negligence was found to have been causative of the injuries for which the respondent sought damages.

5. [25]

   The primary judge rejected the appellant’s submissions that the risk of a lift operator having to take urgent remedial action to raise a down-bar was an inherent risk involved in boarding a chairlift and that such boarding was a dangerous recreational activity for the purposes of s 5L of the Civil Liability Act. These findings made it unnecessary to consider whether the respondent’s accident was the materialisation of an obvious risk.

6. [26]

   Finally, the primary judge held that the respondent was not contributorily negligent for the injuries she sustained. This was because the appellant failed to discharge its onus of proving that the respondent moved out of alignment with the chair as a result of her panicking as opposed to the panicking of her companions.

7. [27]

   In the first judgment, the primary judge discussed in detail the evidence concerning the extent of damages recoverable but did not make final orders. As a number of issues going to the quantification of damages had not been addressed fully, the primary judge deferred consideration of the issue to the hearing of 9 September 2013. He also deferred consideration of the statutory inconsistency issue to that date. The decision on those matters was announced on 4 October 2013. The primary judge found that the Parts 1A and 2 of the Civil Liability Act were directly inconsistent with s 74 of the Trade Practices Act on the basis of the High Court’s reasoning in Wallis v Downard-Pickford (North Queensland) Pty Ltd [1994] HCA 17; 179 CLR 388 (“Wallis”) and were thereby invalid to the extent of that inconsistency in accordance with s 109 of the Commonwealth Constitution. Parts 1A and 2 neither applied to regulate the means of establishing a breach of s 74 of the Trade Practices Act nor to limit the amount of damages recoverable in respect of such a breach.

8. [28]

   In relation to damages, the primary judge tabulated his findings as follows:

9. [29]

   The primary judge did not make final orders on 4 October 2013 as the question of interest remained undetermined. He directed the parties to calculate interest and to make submissions as to costs. The parties agreed upon pre-judgment interest in the sum of $175,482.00 and on 27 November 2013 the primary judge entered judgment in the respondent’s favour in the amount of $1,368,700.00, being the rounded sum of $1,192,597.50 and $176,114.24.

10. [30]

    The primary judge made the following orders as to costs:

Issues on appeal

1. [31]

   The following issues arose on appeal:

   1. (1)

      The manner in which the accident happened.

   2. (2)

      The nature and scope of the appellant’s duty of care.

   3. (3)

      The identification of the relevant risk of harm.

   4. (4)

      Whether the appellant breached the duty of care it owed to the respondent.

   5. (5)

      Whether the appellant’s breach of duty was causative of the injuries for which the respondent sought damages.

   6. (6)

      Whether the respondent’s injuries were the result of the materialisation of an inherent risk involved in the act of boarding a chairlift.

   7. (7)

      Whether s 74 of the Trade Practices Act operated on the contract between the appellant and the respondent so as to imply a term into it to the effect that the appellant would render its services to the respondent with due care and skill.

   8. (8)

      Whether Parts 1A and 2 of the Civil Liability Act were inconsistent with s 74 of the Trade Practices Act so as to render them invalid according to s 109 of the Constitution.

   9. (9)

      The efficacy of the appellant’s contractual exclusion clauses in light of ss 4L, 68, 68B and 74 of the Trade Practices Act.

   10. (10)

       The quantification of damages.

Issue 1: How did the accident occur

1. [32]

   There were no other skiers at the loading station when the respondent and her companions arrived at the chairlift for their final run of the day at about 3.45pm. There were two lift attendants on duty. The respondent and her companions arrived at the loading gate and waited for it to open before proceeding to the loading point, the distance between the gate and the loading point being 5.6 metres. It takes approximately 9 seconds for a chair to arrive at the loading point from the moment the entry gate opens. Skiers have less time than this to get from the entry gate to the loading point as they must be aligned properly at the loading point before the chair arrives. When the respondent and her companions arrived at the loading point, they were correctly aligned. This is not disputed. When the chair on to which the respondent and her companions were to load entered the loading station, its safety bar was down. Before the chair reached the respondent and her companions, Mr Lofberg raised the safety bar. The factual issues in contention in this part of the appeal concern where Mr Lofberg was situated when he noticed that the safety bar was down, how he acted after coming to that realisation and how he handled the chair in the process of rectifying the down-bar situation.

2. [33]

   The primary judge found that “Mr Lofberg was at a point no closer to the loading point than the exit point of the bullwheel when he was made aware that the safety bar was down”.

3. [34]

   In the respondent’s affidavit dated 13 December 2009, she deposed that Mr Lofberg was “standing near the loading position, about two metres to the side of the loading run and a similar distance back from the loading position … facing away from the loading point”. In cross-examination, she gave evidence to the effect that Mr Lofberg was about a metre away from the load point, facing the other way shovelling snow and positioned closer to the bullwheel than he was to the load point. The following exchanges took place between Dr Nair-Smith and counsel during cross-examination:

4. [35]

   And:

5. [36]

   In her affidavit dated 10 July 2009, Mrs Nowland, one of the respondent’s companions, deposed that Mr Lofberg was situated "up near the control booth, near the loading point and to the side of the loading point for the chair lift", whereas in her affidavit dated 15 February 2009, she describes his position as being “up near the booth, a couple of metres back and to the side of the loading point for the chairlift”. In cross-examination, Mrs Nowland stated that he was “in front of the building” and “a couple of metres back”.

6. [37]

   In his affidavit dated 16 December 2009, Mr Nowland (the respondent’s other companion) deposed that Mr Lofberg was “taking down the ropes that form part of the queue line” when they arrived at the entrance to the chairlift and that he was “within a few metres, back and to the side of the correct loading position” and was “also facing away from the chairlift”. According to one of the expert witnesses, Mr Gow:

7. [38]

   In his affidavit dated 19 May 2010, Mr Lofberg deposed that he was “standing probably 2 metres from the load point with [his] back to the lift hut”, that he did not “recall the exact distance” and that, although it had been some time since the incident, he “was fairly confident that [he] was not shovelling snow and was just watching passengers shuffle through to the load point.” He deposed that he was “bumping chairs, getting the people in position at the load line when just before the chair got to them I realised the safety bar was down" - “bumping” being a process of taking hold of the back of a chair and moving it slightly backwards to facilitate passengers sitting back on to the chair. He recalled having to take a “couple of steps” (although he could not remember precisely how many) in order to reach the chair with the bar down.

8. [39]

   The primary judge found that Mr Lofberg “noticed that the bar was down late” that is, after the chair had left the bullwheel; that the chair with its bar down “came within less than half a metre and probably less than 300mm” of the skiers before the bar was raised; and that the respondent, Mrs Nowland and Mr Nowland drew Mr Lofberg’s attention to the fact that the bar was down “by yelling at him words to that effect”. The primary judge found that Mr Lofberg accepted “that he noticed [the down-bar] late (the ‘last minute’)” and “did not deny that his attention was directed to it by people yelling that the bar was down”.

9. [40]

   According to Mr Lofberg’s affidavit, “the bar was up for about 1.5 metres before the chair reached Dr Nair-Smith and her companions” and when he “met the chair” and “flicked the safety bar up” he “was approximately 1.5-2 metres from where Dr Nair-Smith and her friends were standing on the load line”. In cross-examination, Mr Lofberg stated that he had "seen the bar at the last minute" but could not say whether the chair was one or three metres from the skiers when he noticed that the safety bar was down. Later he recalled that he realised the safety bar was down “just before the chair got to them” and that “the bar was up for about 1.5 metres before the chair reached Dr Nair-Smith and her companions”.

10. [41]

    The respondent’s evidence was that the chair was “about one metre” from her and her companions when Mr Lofberg flipped the safety bar back. Mrs Nowland described the distance as “probably a foot".

11. [42]

    The primary judge concluded that:

12. [43]

    The primary judge expressly recorded that he “did not form an adverse view of the honesty of any of the witnesses” but at the same time noted the “obvious potential for the witnesses to have been mistaken in their recollection”. There is accordingly no reason to think that any of the witnesses attempted to give anything other than an accurate recollection of events as they perceived them. It is worth recalling, however, that the events occurred over the space of only a few seconds in circumstances that involved stress for those at risk of being struck by the chair with its bar down and that much of the evidence was given many years after the event occurred.

13. [44]

    The distance at which Mr Lofberg was standing from the load line is variously described as “a metre”, “about a metre”, “approximately 1.5-2 metres”, “near the control booth”, “about 2 metres ”, “probably 2 metres ”, “closer to the bullwheel than he was to the load point”, “a few metres ” and “a couple of metres”. The evidence in this regard is unspecific. As has been noted, the primary judge found (at [69] and [157]) that Mr Lofberg was positioned “no closer to the loading point than the exit point of the bullwheel”. It is not clear what the primary judge meant by this. It may be a finding that Mr Lofberg was located at or in close proximity to the exit from the bullwheel or that he was positioned closer to the exit from the bullwheel than to the loading point. If the former interpretation is correct, the primary judge found that Mr Lofberg was approximately 1.8 meters from the load line. If the latter is correct, the primary judge positioned Mr Lofberg over half way between the load line and the exit from the bullwheel, that is, at least 0.9 metres from the load line. On the basis of the evidence to which reference has been made, it seems, that Mr Lofberg was located about a metre from and behind the load point when he realised that the safety bar was down. That distance accords with the evidence of the respondent.

14. [45]

    Mr Lofberg accepted that he only realised the bar was down “late” and that his attention was drawn to that fact by the yelling of the respondent and her companions. The distance between the skiers and the chair at the time at which the bar was raised is variously described in the evidence as “about 1.5 metres”, “between 1 and 3 metres”, “about a metre” and “probably a foot”. Only Mrs Nowland put the distance at 300mm (“a foot”). However that is the distance at which the primary judge found the chair to be from the skiers when the safety bar was raised. This was against the weight of the evidence.

15. [46]

    His Honour gave no reasons for preferring the evidence of Mrs Nowland as compared with that of her companions and Mr Lofberg. There is no reason why her evidence should be given particular weight. With respect, the primary judge was not justified in finding that the chair was only 300 millimetres from the skiers by the time Mr Lofberg raised the safety bar. The weight of the evidence supports a finding that the distance was closer to 1 metre. Given the vagaries inevitably involved in such evidence, it is as impracticable as it is undesirable to attempt any precise finding as to the distance between the skiers and the front edge of the chair when the bar was raised. However, in light of the finding as to the positioning of Mr Lofberg and the evidence of all the witnesses, it should be accepted, on the balance of probabilities, that the front edge of the chair was at least 300 millimetres and more like one metre behind the skiers when Mr Lofberg raised the safety bar.

16. [47]

    The primary judge found (at [69]) that:

17. [48]

    According to Dr Nair-Smith’s affidavit, when the chair was about one metre away Mr Lofberg “lunged forward, grabbed the back corner of the chair with his left hand, pulled the chair back toward him at an angle, flipped the safety bar back up with his right hand, then let go of the chair”. In cross- examination, Dr Nair-Smith stated:

18. [49]

    And later:

19. [50]

    According to Mrs Nowland’s affidavit, Mr Lofberg:

20. [51]

    In his statement made after the incident on 18 July 2003, Mr Lofberg said that “when the chair came around [the bullwheel] I noticed safety bar was down but I got it up in time”. In response to a question regarding what he did during the incident he responded:

21. [52]

    In his affidavit dated 19 May 2010, Mr Lofberg deposed:

22. [53]

    It may be accepted that Mr Lofberg had to move toward the chair in order to be close enough to raise the down-bar. He came at the chair from behind. Given the timeframes and distances involved, it may also be accepted that Mr Lofberg had to move quickly such that his movements could aptly be described as a “lunge” and his manner as “hurried”.

23. [54]

    There are competing accounts of what caused the respondent to be misaligned with the chair. According to the respondent and her companions, Mr Lofberg was the effective cause of the misalignment because he pulled the chair in his hurried attempt to raise the safety bar while they remained in what otherwise would have been the correct loading position. Mr Lofberg, by contrast, gave evidence that the chair was travelling in its normal alignment when it arrived at the loading point and that he did not apply any extraordinary force to it such as would cause it to move out of the correct alignment. The expert evidence suggested that it was highly unlikely that Mr Lofberg could have applied sufficient force in sufficient time to cause the chair to misalign in the way that it supposedly did. The primary judge preferred the evidence of the experts and found that the panic induced by Mr Lofberg’s delay in raising the down-bar caused the respondent to move out of alignment with the chair.

24. [55]

    The primary judge found that Mr Lofberg did not apply sufficient force to the chair, either by pulling it or by subsequently pushing it, to cause it to move to the left before it struck the respondent. His Honour found (at [126]:

25. [56]

    According to his Honour, "the axis point at the top of the chair enabled Mr Lofberg to pull the chair back with his left hand while he lifted the safety bar with his right. The subsequent behaviour of the chair under that scenario would account for the acceleration of the chair that the skiers observed".

26. [57]

    It is necessary to further analyse the evidence on this issue.

27. [58]

    The respondent deposed that “[a]t no stage during this process [ie, the loading process] did I change the alignment of my body or my skis”. She also said:

28. [59]

    According to the respondent, Mr Lofberg’s action caused the chair to come at her and her companions “at a much higher speed than normal". In cross-examination, she stated that Mr Lofberg pulled the chair back "inches, feet - perhaps a foot. It would have been in the inches”.

29. [60]

    Mrs Nowland also gave evidence that her “skis and feet had remained in the correct front alignment throughout the whole process”. In her witness statement dated 18 July 2003, Mrs Nowland stated:

30. [61]

    In her affidavit dated 15 February 2009, Mrs Nowland added to the end of the foregoing statement that Mr Lofberg “let go of the chair and it came at us at an angle and faster than expected”.

31. [62]

    In her affidavit dated 10 July 2009, she added that “as [Mr Lofberg] lunged he held the chair, which effected to push the chair down with his body weight”.

32. [63]

    Mr Nowland said in his affidavit of 10 December 2009, that “[d]uring this whole procedure I had not changed the alignment of my skis. They were still facing forward” and that:

33. [64]

    In his affidavit dated 16 December 2009, Mr Nowland deposed that:

34. [65]

    Mr Lofberg deposed in his affidavit of 19 May 2010 that:

35. [66]

    In cross-examination Mr Lofberg gave evidence that he never saw Dr Nair-Smith and her companions out of alignment. The following exchange took place:

36. [67]

    He later stated that “[t]hey got on the chair, so they must have been pretty close to where they had to be, otherwise they would not get seated".

37. [68]

    In relation to the way in which he handled the chair, Mr Lofberg deposed that he “had time to bump the chair in the normal way. Because of where [he] was standing” and that:

38. [69]

    He later stated that "just before the chair got to them, I realised the safety bar was down. I quickly flicked it up and bumped the chair back, it appeared the people got on the chair without incident". He maintained this position in cross-examination:

39. [70]

    Expert evidence was provided by Mr Mark Dohrmann, a qualified engineer and ergonomics expert retained by the respondent, Mr Charles Needham, an engineer retained by the appellant, and Mr John Gow, who has extensive experience in the conduct of ski resorts and the operation of chairlifts, who was also retained by the appellant. The experts provided individual reports and participated in a joint expert conclave, the minutes of which were in evidence.

40. [71]

    In his report dated 24 October 2007, Mr Dohrmann assumed that Mr Lofberg had pulled the chair causing it “to be held back well off the vertical and also obliquely to the forward line of movement of the cable”. He concluded that it was likely that the respondent’s injuries were a result of a lift operator electing “to pull a heavy triple chair back (presumably to try and gain a moment’s time) when the chair, with safety bar in the incorrect ‘down’ position, had approached too close, instead of stopping the lift”.

41. [72]

    Mr Dohrmann abandoned the above assumption in his report dated 26 August 2008 after he had inspected the lift. He no longer considered the chair to be capable of moving in this way. Nevertheless, on the information available to him, he concluded that:

42. [73]

    In Mr Gow’s report dated 9 October 2008, he states that:

43. [74]

    It should be noted that there was no evidence that the respondent “deliberately moved herself out of the correct load position”. However, this does not exclude the possibility that the respondent may have moved unconsciously.

44. [75]

    In Mr Gow’s supplementary report dated 28 May 2010, he stated that “even if the operator did attempt to hold or pull the chair back, there is simply not enough time for it to roll back toward them”.

45. [76]

    In his report dated 6 April 2010, Mr Needham provided a series of calculations designed to show the potential chair misalignment at the load line allowing for certain variables including the amount of force applied to the chair by the lift operator, the angle at which that force was applied, the time for which that force was applied, the distance from the skiers at which the force was applied and, as a correlate, the time between when the force was applied and when the chair would reach the skiers. Mr Needham concluded that:

46. [77]

    Mr Needham provided the following examples:

47. [78]

    Mr Needham’s considered opinion was, in effect, that even if the misalignment of the chair was calculated on the basis of variables most favourable to the respondent, it was unlikely that the chair would have deviated to the left as she and her companions stated it did. In the course of cross-examination, the following exchange took place between the primary judge and Mr Needham:

48. [79]

    In his report dated 30 June 2010, Mr Dohrmann stated:

49. [80]

    The “other forces as described above” is a reference to the possibility that Mr Lofberg might have pushed the chair forwards and to the side as he “bumped” it. In cross-examination, Mr Dohrmann stated that it would have been possible for the chair to swing to the left had Mr Lofberg pushed the chair.

50. [81]

    In the minutes of the expert witnesses’ conclave, it is recorded that Mr Dohrmann responded “Yes” to the question whether it was “physically possible for the chair to have rolled to the left and to have accelerated by the time it reached the load line?” By contrast, Messrs Baugher, Gow and Needham jointly responded "No". According to these experts, “in the <1 sec of travel time that the chair has between exiting the bullwheel and arriving at the load point there was not physically enough time for this to have occurred”.

51. [82]

    In his report dated 24 October 2007, Mr Dohrmann had assumed that Mr Lofberg had pulled the chair causing it “to be held back well off the vertical and also obliquely to the forward line of movement of the cable”. However, as was stated at [72] above, Mr Dohrmann ultimately abandoned this assumption.

52. [83]

    The primary judge made the following findings (at [59]):

53. [84]

    There is no acceptable evidentiary basis on which it can be found that Mr Lofberg pushed the chair when he was either bumping the chair or raising the down-bar. The respondent bore the onus of proving this circumstance on the balance of probabilities and it cannot be accepted that she has done so. The expert evidence was unanimous that, if Mr Lofberg did not push the chair, it was not physically possible, in the time available, for the chair to be pulled to the right and then to swing back out of alignment to the respondent’s left. Mr Dohrmann’s evidence to the contrary was predicated on the assumption that Mr Lofberg had pushed the chair. We accept the expert evidence and the primary judge’s finding that the chair was not out of alignment with the respondent to her left and to the left of where it should have been – and that it was the respondent who was out of alignment to the chair’s right.

54. [85]

    The primary judge concluded (at [66]) that the respondent’s misalignment resulted from the panic and jostling of her companions and herself. He found that on the evidence he could not determine which of the three persons precisely was responsible for causing the respondent to move out of alignment. Nevertheless, his Honour found that he was not satisfied that the misalignment of the respondent was a result of a panicked reaction by her alone: see [72].

55. [86]

    Mr Nowland gave evidence in cross-examination that when the chair was approaching with its bar in the down position he was in “a state of concern”. Mr Lofberg recalled that the respondent and her companions “panicked” and “seemed to panic”, albeit that he could not recall precisely what caused him to have that impression. Mrs Nowland gave evidence that “[w]e all realised in horror the safety bar was down and we had nowhere to go. We all tried to leap out of the way". On the basis of this, Mr Gow formed the opinion that “the description provided by Mrs Nowland conveys a degree of panic on the part of Ms Nair-Smith and her companions that appears to have influenced their response to what should have been a routine operating event”. It is not clear what weight, if any, should be given to Mr Gow’s opinion in this regard.

56. [87]

    The regular speed of the chair lift is 2.3 metres per second. The following table records the distance and travel time between relevant points:

57. [88]

    The respondent and her companions, wearing skis, correctly positioned and aligned themselves upon arrival at the load line. While waiting for their chair to arrive, they noticed, as that chair came downhill towards the bullwheel, that its safety bar was down. Their awareness came from looking to their left and observing the chair before it reached the bullwheel. Mr Lofberg was not paying attention to the incoming chair on the opposite side of bullwheel and it was not suggested that he should have done so. However, calls of the respondent and her companions drew his attention to the fact that the safety bar was down. At that time, Mr Lofberg was positioned approximately one metre from the load line.

58. [89]

    Once Mr Lofberg heard the calls and realised the bar was down, it was necessary for him to take a few hurried steps towards the chair in order to raise the bar. He moved quickly to the chair and raised the bar from behind it with a lunging movement. He was able to raise the bar before the chair reached the waiting skiers but not before it was between 300 millimetres and one metre behind them.

59. [90]

    At some point after the respondent first positioned herself correctly at the load line, she moved out of alignment to the right causing the right armrest of the chair to strike her in the groin area from behind as the chair came past the load line and into contact with the skiers.

Issue 2: Duty of care

1. [91]

   The primary judge articulated the duty of care owed by the appellant to the respondent as the duty to exercise “reasonable care and skill in respect of the her [sic] safety and in operating the chair and to allow her to safely utilize the chair”. The appellant did not challenge this formulation of its duty. It may readily be accepted that the appellant was under a duty of care to exercise reasonable care and skill in the provision of its lifting services to avoid harm to skiers using those services.

Issue 3: Risk of harm

1. [92]

   The proper assessment of the appellant’s alleged breach depends on “the correct identification of the relevant risk of injury”: Roads and Traffic Authority of New South Wales v Dederer [2007] HCA 42; 234 CLR 330 at [338] per Gummow J. The primary judge characterised the relevant risk (at [138]) (Civil Liability Act, s 5B(1)) as the risk of physical harm resulting “from a chair arriving at the loading station [as distinct from at the loading point] in a state not suitable for boarding”. According to the primary judge,

2. [93]

   However, when determining whether this risk was foreseeable for the purposes of s 5B(1)(a), the primary judge appears to have found (at [148]) that the risk was that of “physical harm being occasioned to a skier from a chair arriving at the loading station with its safety bar in the down position”. This is how the respondent characterised the risk of harm at trial. At [138], the primary judge stated that it did not matter in which of these two ways the risk was characterised. The distinction is, however, important.

3. [94]

   With respect to the first description of the relevant risk – the broken chair risk – the primary judge should not have characterised the risk at the level of generality he adopted. At trial neither party submitted that this was the relevant risk of harm. The chair that struck the respondent was not broken. No party or witness suggested that the respondent was injured because the chair was broken. The chair functioned as it was designed to function. There was no evidence as to the how frequently broken chairs arrived at the loading station, whether skiers can safely be conveyed by broken chairs or what procedures a lift operator can or should take in response to the arrival of a broken chair. It may not be possible for a lift operator to rectify a broken chair situation, whereas it is possible for a lift operator to rectify a down bar situation before the chair reaches the load point. The precautions a reasonable person may take in response to the possibility of the arrival of a broken chair as compared with a chair with its bar down may be entirely different. No evidence was adduced on this. The risk of physical harm resulting from a broken chair arriving at the loading station was neither relevant nor a source of the respondent’s injuries. Consideration of the broken chair possibility introduced an irrelevant consideration.

4. [95]

   However, even if the second description (that is, the description at [148]) is preferred, such a characterisation of the risk does not identify the “true source of potential injury”: Dederer at [60] per Gummow J. This characterisation refers to the risk that a skier waiting at the load point might be struck by a chair with its safety bar down and the risk that injury might be sustained as a consequence of the skier’s response to the potential for collision even if collision does not eventuate. The former risk did not materialise in the present case. The right armrest of the chair came into contact with the respondent with its bar up. Mr Lofberg raised it before it reached her. It is the latter risk that presents itself for consideration. By failing to distinguish between these two risks the primary judge erred in his assessment of the probability of the relevant risk occurring and the control that the appellant had over it.

5. [96]

   First, the primary judge’s characterisation led him to focus on the frequency of an antecedent event, namely the arrival of chairs at the load station with the safety bar down, rather than on the probability of injury occurring as a result of a skier’s reaction to a lift operator’s late response to a chair continuing around and exiting from the bullwheel with its bar down. We accept the primary judge’s findings (at [141]) that “there is a foreseeable and not insignificant risk of chairs arriving at the loading station with the safety bar in a down position” and that the possibility, referred to by Mr Gow in cross examination, of experienced skiers either raising the bar themselves or allowing the chair to “push them down the ramp” does not “detract from the significant possibility or even likelihood that skiers may be injured from a collision, especially if they move, scramble or fall to the side”: at [145]. Nevertheless, the reaction of skiers to a late response by a lift operator to a down-bar situation is an important contingency that needs to be factored into the assessment of whether the relevant risk was foreseeable and not insignificant. The primary judge appears to have taken account of this contingency: see at [145]. However, by eliding the risk “of chairs arriving at the loading station with the safety bar in a down position” and the risk that skiers may react and injure themselves as a consequence of a lift operator’s late reaction to such a situation, the primary judge’s analysis suggests that the probability of this risk occurring was higher than it in fact was.

6. [97]

   Second, the primary judge found (at [142]) that “whether the fact of a safety bar being down (or of some other defect) would or might result in injury to a skier who was already at the load point was very much in the control of Perisher”. However, “the fact of a safety bar being down” is an incomplete description of the relevant risk. The risk arose in this case because of the conjunction of the bar being down, Mr Lofberg’s late response to it and the appellant and her companions’ reaction to that response. The appellant had control over the first two factors but only limited control over the third. When the risk is stated with the necessary particularity, it becomes clear that it is not something that was “very much in the control” of the appellant. The elision of the two risks stated (in [95]) above led the primary judge to attribute to the appellant a greater degree of control over the risk than it possessed.

7. [98]

   In Dederer, Gummow J suggested (at [60]) that identification of the relevant risk is concerned with determining the “source” of the potential injury. In McKenna v Hunter & New England Local Health District; Simon v Hunter & New England Local Health District [2013] NSWCA 476 Garling J (at [266]), although in dissent, describes this as “general causal mechanism of the injury sustained”. In essence, the enquiry is concerned with determining what person, thing or set of circumstances gave rise to the potential for the harm for which the plaintiff seeks damages.

8. [99]

   In Dederer, Gummow J found that the relevant risk (identified at [60]) arose from a conjunction of factors, namely, the bridge’s location, Mr Dederer diving from the bridge and the natural variations of the estuary bed, which gave rise to the potential for shallow water: see at [62]. In so finding, he rejected the Court of Appeal’s finding that the risk was “one created by the RTA through the erection of the bridge by its predecessor”: [60].

9. [100]

   In the present case, the source of the respondent’s injuries was the impact of the chair’s right armrest with her groin. In Shaw v Thomas [2010] NSWCA 169 at [43] Macfarlan JA said:

10. [101]

    It is equally unnecessary to determine the precise source of the plaintiff’s potential injuries when identifying the relevant risk for the purposes determining negligence under Part 1A of the Civil Liability Act. For example, in Garzo v Liverpool/Campbelltown Christian School [2012] NSWCA 151 at [123]) Tobias AJA (with the concurrence of Meagher JA) identified the relevant risk as “that of a person slipping on the painted surface of the crossing and thereby suffering an injury.” Importantly, his Honour found that it was unnecessary to articulate the risk “in any greater detail than that.”

11. [102]

    Accordingly, it would be inapt in the present case to characterise the relevant risk as the risk of physical harm through collision of a chair’s armrest with a passenger’s groin. Such a formulation would be too narrow. Similarly, the risk cannot simply be characterised as the risk of being struck by a chair and thereby sustaining physical injury. This would be too broad. Contact between chairs and skiers is a routine and necessary part of boarding a chairlift. It is an everyday innocuous event, from which injury may be taken to be rare. The respondent’s injuries arose not from the state of the chair, but from her misalignment with it.

12. [103]

    The essence of the risk formulated by the appellant was the risk “that the conduct of the Appellant’s employees might cause a skier to be misaligned, even if a ‘bar down situation’ was rectified”. At trial the respondent submitted that “the inattention and delayed response to the down bar situation by the [appellant’s] lift operator” caused her to be out of alignment. Ultimately, this is what the primary judge found: see, for example, at [72].

13. [104]

    The relevant risk is that a skier might sustain physical injury as a result of his or her reaction to the manner in which a lift operator responds to a down-bar situation. There is a foreseeable and not insignificant risk of chairs arriving at the loading station with their safety bars down. This presents a risk of physical injury because of the potential for such chairs to collide with skiers waiting at the load point. As the primary judge correctly observed (at [145]), “[t]here is a significant possibility or even likelihood that skiers may be injured from a collision, especially if they move, scramble or fall to the side”. This risk was both foreseeable and foreseen by the appellant. As the primary judge found at [145], “[i]f that was not the case then there would be little point in Perisher giving instructions to its lift operator to be on guard for a safety bar being down.” However, the relevant risk in this case involves something more than this. Skiers waiting at the load point to board a chair are in a vulnerable position. It is helpful to recall the primary judge's finding (at [133]) in this connection:

14. [105]

    Skiers rely on lift operators to rectify down-bar situations in order to avoid such a collision. If a lift operator does not intervene, or gives the waiting skiers an impression that they will not intervene in time, it is only natural that skiers will react. The risk of injury is a product of a combination of factors, namely, the approach of the chair with its bar down, a response of a lift operator that has the potential to convey to waiting skiers a fear that the situation will not be rectified in time and the likelihood that skiers will react to the possibility of collision. One does not need the benefit of hindsight to appreciate the potential for harm that a skier’s reaction may involve in such a situation. Given the characteristics of the chairlift and the vulnerability of skiers waiting to board it, there is both a foreseeable and not insignificant risk that physical injury may result from a skier’s reaction, whatever form it may take.

15. [106]

    Generally, it is as unnecessary as it is undesirable to define the relevant risk with this level of particularity. Particularity is called for in the present case because several risks attend the process of boarding a chairlift and unless the relevant risk is identified with sufficient precision one cannot determine what, if any, reasonable precautions ought to have been taken in order to avert it.

Issue 4: Breach

1. [107]

   The principles governing whether the appellant breached its duty of care are governed by s 5B of the Civil Liability Act:

2. [108]

   Section 5C is also relevant:

3. [109]

   The appellant was only under a duty to exercise reasonable care: Derrick v Cheung [2001] HCA 48; 181 ALR 301 (at [13]). In order to identify whether a breach of duty has occurred one has to identity, "with some precision, what a reasonable person in the position of the defendant would do by way of response to the reasonably foreseeable risk": Graham Barclay Oysters Pty Ltd v Ryan [2002] HCA 54; 211 CLR 540 (at [192]) per Gummow and Hayne JJ. Breach must be assessed prospectively not retrospectively: Dederer at [338].

4. [110]

   According to the primary judge (at [153]), “[t]he critical question in terms of what precautions, if any, were required concerns the interrelated questions of when an observation of the state of the incoming chair should be made, and what position the lift operator should be in when it is made”. The primary judge found (at [157]) that taking the precaution of “having a ski [sic: scil: lift] operator near or close to the loading point observing, at the very latest, the state of the chair as it exits the bullwheel… would have enabled Mr Lofberg to raise the bar in a ‘timely manner’”. Accordingly, the primary judge held (at [166]) that the appellant’s negligence consisted of “Mr Lofberg placing himself in the position that he was in and only noticing that the bar was down so late.” Mr Lofberg’s duty to exercise reasonable care required him to keep a proper lookout for chairs that might not be in a safe condition for boarding passengers. The point in time at which Mr Lofberg was required to make that observation was contingent on where he was situated.

5. [111]

   The primary judge had to identify the point at which reasonable care required Mr Lofberg to observe the condition of the chair. His Honour’s critical finding was that Mr Lofberg was required to observe the condition of the incoming chair as it exited the bullwheel on its approach to the waiting passengers because he was situated “closer to the bullwheel than the load line”: [156]. Mr Lofberg’s failure to direct his attention to the chair at that point was seen by the primary judge as negligent.

6. [112]

   The primary judge referred to the following expert evidence of Mr Gow regarding the propensity of chairs to arrive at the loading station with the safety bar down:

7. [113]

   On the basis of this evidence his Honour concluded (at [141]-[142]) that there was “a foreseeable and not insignificant risk of the chairs arriving at the loading station with the safety bar in a down position”. He also noted that there was a very low rate of recorded injuries involving chairs notwithstanding the high frequency of use but attributed the low rates of injury to the control exercised by the appellant over the lifting process: [142]. The primary judge dealt with the evidence concerning the appellant’s safety procedures. At [143] he quoted from a document entitled “Lift Safety Procedures” dated 13 November 2002. Under the heading “Lift Safety” it states that lift operators are to “[n]ever have your back to the public whilst loading or unloading guests”. Under the heading “Chairs” it states:

8. [114]

   His Honour then quoted from the cross-examination of Mr Lofberg in which he accepted that a failure to observe a down-bar would result in the skiers being unable to board the chair properly. He referred (at [145]) to Mr Gow’s evidence as to the possibility that experienced skiers would be able to rectify a down-bar situation themselves but concluded that this does not “detract from the significant possibility or even likelihood that skiers may be injured from a collision” with a down-bar or as a consequence of trying to avoid such a collision. His Honour also noted that the appellant’s document requires chairlift operators located at the top station to “keep an eye out for bail arms that have been blown down" in windy conditions, in which case they are to telephone the bottom station. His Honour concluded (at [148]):

9. [115]

   His Honour continued (at [150]) that “[t]he considerations that lead me to conclude that the identified risk of harm was foreseeable also lead me to conclude that it was ‘not insignificant’ notwithstanding the differences between the two tests”.

10. [116]

    At trial, the respondent particularised the relevant duty of care as follows:

11. [117]

    These matters were addressed by Mr Gow in his report. The primary judge considered that his evidence provided useful guidance as to what could reasonably be expected of a lift operator. Mr Gow stated that during the interval between the departure of one chair and the arrival of another the safety procedures required the operator to do the following:

12. [118]

    Mr Gow explained the point at which an observation of the incoming chair should be made:

13. [119]

    Mr Gow’s evidence was predicated on the lift operator being located at, or close to, the load line. According to the primary judge, “[i]f the lift operator was located further forward of [sic: scil: behind] the loading point then the observation needed to be much earlier”. This was because he found (at [156]) that:

14. [120]

    The primary judge found (at [157]) that:

15. [121]

    This finding was consistent with Mr Lofberg’s evidence referred to at [38] above that he was standing about 2 metres from the load point. The effect of the primary judge’s finding was that “the ‘precaution’ of having a ski operator near or close to the loading point observing, at the very latest, the state of the chair as it exits the bullwheel was not given effect to”.

16. [122]

    Having regard to the relevant matters in ss 5B(2) and 5C of the Civil Liability Act, the primary judge found (at [158]-[161]) that a reasonable person would have taken this precaution because there was a “realistic prospect of physical harm being occasioned” were it not taken (s 5B(2)(a)) from which “considerable damage” could “obviously” result (s 5B(2)(b)) and the burden of taking the precaution was not significant (s 5B(2)(c)).

17. [123]

    In addressing the question of breach, the primary judge dealt with certain passages from Davis v Bunn [1936] HCA 44; 56 CLR 246. After distinguishing that case, he went on to make the following findings (at [167]):

18. [124]

    The appellant’s submissions on breach were directed substantially to the proposition that Mr Lofberg was not out of position. It was accepted by both parties that the earliest a lift operator could intervene to rectify a down-bar situation was after the chair had left the bullwheel. It is the practice of lift operators to move away from the load line toward the bullwheel and an incoming chair in order to “bump” the chair before it reaches skiers waiting at the load line. The practical exigencies involved in bumping chairs require that lift operators move away from the load line in this way. According to the expert evidence, this procedure, including moving away from the load line towards incoming chairs, accords with international industry practice. According to one of the experts, Mr Gow, “[t]here is no necessity for the operator to stand in immediate proximity to the load point at all times in the load process, as the operator will move back to a position to bump the chair once the passengers are in the loading position". Video of a lift operator performing this procedure shown to the Court confirmed that the lift operator had to take a few steps towards the incoming chair in order to bump it before it reached skiers waiting to load.

19. [125]

    In the circumstances that prevailed, the finding must be that, Mr Lofberg was not out of position. However, this is only one component of the negligence as found by the primary judge. His Honour found (at [166]) that “[t]he negligence arises from Mr Lofberg placing himself in the position he was in and only noticing the bar was down so late.” Therefore, the primary judge found that the appellant’s negligence comprised the combination of where he was located and when he noticed that the bar was down.

20. [126]

    The appellant also submitted that it was reasonable for Mr Lofberg to “engage in other tasks than merely looking out and reacting to ‘down bar situations’”. For instance, a lift operator may shovel snow and maintain the snow path. This submission must be accepted. Reasonable care does not require that a lift operator give undivided attention to ensuring that chairs are in a safe condition for loading, yet he must be vigilant to see that they are, especially given the short distance between the load point and the bullwheel (1.8 metres), the time it takes for the chair to cover that distance (0.78 seconds) and the vulnerable position of the waiting skiers. A lift operator does have to keep a look out for down-bar situations or other problems with chairs that may imperil the safety of skiers attempting to use the lift. A lift operator may attend to other duties provided he or she can still keep such a proper look out.

21. [127]

    Further, the appellant submitted that the fundamental error in the primary judge’s ultimate conclusion was that his Honor’s finding of negligence depends upon:

22. [128]

    The primary judge’s findings as to when Mr Lofberg should have observed the down-bar state of the chair were not imprecise. He found (at [169]) that had Mr Lofberg been located at or close to the load line (which is 1.8 metres from the bullwheel), he should have observed the chair as it left the bullwheel 0.78 seconds before it reached the load line. The closer he was to the bullwheel, the sooner he should have made this observation. Instead, Mr Lofberg realised the bar was down when the chair had less than 1.8 metres (and 0.78 seconds) to travel. There is nothing imprecise about this. Furthermore, it is difficult to see how the primary judge could have been any more precise, given that the incident occurred in dynamic circumstances over no more than a few seconds and was recounted in evidence that was very largely impressionistic. The primary judge could not reasonably have attempted any more precise findings in the circumstances.

23. [129]

    It was also submitted by the appellant that it is “to be reasonably expected that a lift load operator might move quickly and urgently in the short time available before a chair with a ‘down bar’ reached the waiting skiers”. It may be accepted that a lift operator would have to rush or hurry to rectify a down-bar situation. But this does not mean that Mr Lofberg was not required to observe the condition of the chair earlier than he did.

24. [130]

    A related issue on appeal was whether Mr Lofberg raised the bar in a “timely” manner. At [166] the primary judge held that:

25. [131]

    The primary judge’s finding of breach of duty centred on a requirement of reasonable care that a lift operator be positioned and paying attention in such a way that the state of each approaching chair can be appreciated, at the latest, when the chair exits the bullwheel. Mr Lofberg was found not to be so positioned. This prevented him from observing the down bar earlier. In the view his Honour took, that failure meant that there was lack of reasonable care.

26. [132]

    The appellant challenges both the proposition that the exercise of reasonable care required that a lift operator be positioned in any particular place and the judge’s conclusion that negligence arose from Mr Lofberg placing himself in the position he in fact occupied and “only noticing the bar was down so late”. There is merit in that submission. Implicit in the judge’s conclusion is the proposition that, had Mr Lofberg noticed the down-bar situation earlier than he did, he would have raised the bar at an earlier point.

27. [133]

    The earliest point at which Mr Lofberg could possibly have intervened to rectify a down-bar situation was at the point the chair exited the bullwheel and thus 0.78 seconds before the chair reached the waiting skiers. At that point, the chair would still have had 1.8 metres to travel. It could not reasonably be expected that Mr Lofberg would raise the bar at that point because his duties generally required him to be located near the load line in order to bump incoming chairs. The primary judge found that Mr Lofberg raised the bar when the approaching chair was between 500 and 300 millimetres from the respondent and her companions. The chair still had to travel between 0.22 and 0.13 seconds before reaching the skiers. This means that Mr Lofberg raised the bar 0.56 to 0.65 seconds after the chair exited the bullwheel. However, the finding (at [46] above) that the front edge of the chair was at least 300 millimetres and more like one metre behind the skiers when Mr Lofberg raised the safety bar means that Mr Lofberg raised the bar within some 0.39 to 0.65 seconds of it leaving the bullwheel.

28. [134]

    The respondent bore the onus of proving that Mr Lofberg could have raised the bar earlier had he noticed it sooner. Given the tight timeframes involved and the speed with which he in fact raised the bar, it should not be found he could have done so. Further, it should not be found that any extent to which he may have been able to lift the bar sooner could be sufficiently significant for the purposes of assessing breach. The difference could only be a small fraction of a second. What is not explained is how action earlier than that in fact taken would have avoided some risk that was presented by the circumstances that in fact pertained – or, to put this another way, how some reasonable precaution that was not operative in the events that happened would have been operative if Mr Lofberg had realised at an earlier time that the bar was down. Mr Lofberg did not breach his duty of care by failing to raise the bar sooner than he did. Further, we agree with the primary judge that Mr Lofberg’s reaction to the down-bar situation, once he realised that it existed, did not bespeak negligence.

29. [135]

    However, when the relevant risk is properly characterised as the risk a skier might sustain physical injury as a result of his or her reaction to the manner in which a lift operator responds to a down bar situation (see [104] above), paying attention to the condition of incoming chairs earlier may have avoided this risk. The implicit proposition in the primary judge’s reasoning on causation is not only that had Mr Lofberg directed his attention to the condition of the chair sooner he may have been able to rectify the down-bar situation more quickly but that if he had directed his attention to the chair sooner, the skiers may not have panicked because they would have had greater confidence in his ability to rectify the situation or would have observed that he had done so sufficiently before the chair reached them rather than when it was only 300-500mm from them.

30. [136]

    The time at which a lift operator realises that a chair is not in a condition fit for boarding may affect the confidence that skiers waiting to board the chair may have in the operator’s capacity to rectify the situation and therefore may affect how they are likely to react to that circumstance. This applies whether or not the lift operator’s delayed realisation has any actual effect on when he or she is able to rectify the situation. We are not persuaded that Mr Lofberg’s delayed realisation of the chair’s condition materially affected the point at which he was able to raise the bar. However, we are prepared to accept that the psychological effect of his delayed realisation may have been significant. That is a pertinent consideration when the relevant risk is that people may injure themselves through their reaction to how a lift operator responds to a down-bar situation. In this context it must also be remembered, first, that the respondent and her companions were conscious that the safety bar was down and that that was the only obstacle to a safe boarding of the chair; second, the skiers were waiting on a platform raised above its surrounds at a height which appears to be about 5cm; and third, with a chair approaching with its bar down, it is not clear where they could go to get out of its way or what avoiding action they could take. If Mr Lofberg did not get to the bar in time, they either had to raise the bar themselves or be struck by the chair with its bar down. As the primary judge found at [134]:

31. [137]

    The reasonable care requirement demanded that Mr Lofberg pay reasonable attention to the condition of chairs arriving to load skiers: Manley v Alexander [2005] HCA 79; 80 ALJR 413. His attention did not focus on the condition of the chair that struck the respondent until after it left the bullwheel. Because the chair has only a short distance to travel after leaving the bullwheel and before reaching the load line, a lift operator has only a limited time within which to respond to and deal with a down-bar situation. If the bar is down after the chair leaves the bullwheel, skiers waiting at the load line are in a vulnerable position and may well panic unless the lift operator responds very promptly to such a situation. The closer the chair is to them when the operator responds, the greater will be their propensity to panic or react in such a way that physical injury may result. Reasonable care required Mr Lofberg to direct his attention to the condition of the chair earlier than he in fact did. His failure to do so constituted a breach of the appellant’s duty of care.

Issue 5: Causation

1. [138]

   With respect to the principles applicable to causation under s 5D(1)(a) of the Civil Liability Act concerning factual causation, the primary judge made the following findings (at [169]):

2. [139]

   The primary judge thus found, in effect, that Mr Lofberg’s failure to observe the down-bar situation when the chair was exiting the bullwheel caused him to dive or lunge at the chair, grab it from behind, make rushed movements and not intervene and raise the bar until the leading edge of the chair was “within less than half a metre and probably less than 300mm of contact with the skiers” (see [70]); and that this, in turn, caused the respondent and her companions to panic and jostle, which resulted in the respondent’s right leg being out of alignment with the oncoming chair. With respect to the respondent’s misalignment, the primary judge found (at [65]) that at the point of collision “Dr Nair-Smith’s pelvic area was at some point to the right of the designated loading point on the raised area” and that “at least one of her legs had moved off the slightly elevated platform to the right.” The critical finding of his Honour was that “[t]he misalignment of Dr Nair-Smith was the consequence of jostling in reaction to the chair coming so close with a [sic: scil: its] safety bar down, although not necessarily by her”: [72]. By this his Honour meant that “it could have been a result of a panicked reaction by her or one or more of her travelling companions (or all three) and their jostling her”: [66].

3. [140]

   The appellant submitted that, in the absence of any finding or evidence of the movement, position or degree of misalignment that caused the respondent to be struck by the armrest (and given the respondent’s denials that anything caused her to be misaligned), the primary judge could not properly find that whatever movement resulted in misalignment was caused by the “late” conduct of Mr Lofberg as distinct from, for example, jostling before the chair had even commenced to go around the bullwheel. Furthermore, there was a lack of evidence to support a finding that there was anything extraordinary about the respondent’s misalignment and, in any event, it appears that the respondent and her companions panicked well before Mr Lofberg could reasonably be expected to have responded to the down-bar situation so that panic on their part cannot be attributed to any “delayed” reaction or realisation by Mr Lofberg.

4. [141]

   It is necessary here to say something about how the proceedings were conducted below. The primary case of the respondent was that she and her companions were all properly aligned at the load point throughout the loading process, including when the chair reached them. She submitted that the misalignment that caused the right armrest of the chair to come between her legs occurred because Mr Lofberg either pulled or pushed the chair when he raised the bar so that it moved to the left of where it should have been when it reached her at the load line. The respondent and her companions all gave evidence to this effect.

5. [142]

   Expert evidence was adduced that contradicted the respondent’s primary case. The weight of the expert evidence denied the possibility that the chair was out of alignment to the respondent’s left. The primary judge accepted that expert evidence and found that the chair could not have been to the left of where it should have been in the circumstances. That finding is not challenged on appeal. A finding that the respondent was out of alignment to the right of the chair was therefore the only available explanation of how she came to sustain the injuries she in fact sustained. Contrary to the evidence of the respondent, her companions and Mr Lofberg but consistently with the expert evidence, the primary judge found that it was the respondent who was out of alignment, not the chair. The primary judge recognised this at [65]:

6. [143]

   However, the respondent also submitted in the alternative in final written submissions that:

7. [144]

   The primary judge attributed the respondent’s misalignment to panic and jostling amongst the respondent and her companions occasioned by the chair coming so close to them with its bar down: see [72]. However, the respondent and her companions did not give evidence to this effect. They were all adamant that they did not move from the correct position. They did not give evidence that they were jostling. Further, they did not give any direct evidence that they were panicking, albeit that a certain state of concern can be inferred from their evidence. They neither gave reasons why they moved out of alignment (if they did) nor were they examined or cross-examined on this. This is unsurprising given the way in which the respondent’s primary case was run.

8. [145]

   In his affidavit dated 19 May 2010, Mr Lofberg deposed that the chair was travelling in its normal alignment and that “[i]f Dr Nair-Smith had remained in the correct position at the load point, she would not have straddled the side rail and would have sat down on the chair normally". However, in cross examination he conceded that he did not see the respondent or her companions move from the correct position for loading and stated that "[t]hey got the on chair, so they must have been pretty close to where they had to be, otherwise they would not get seated".

9. [146]

   In effect, although the primary judge’s finding that panic and jostling amongst the respondent and/or her companions caused the respondent to be out of alignment was partially consistent with how respondent’s secondary case was articulated, it was contrary to the respondent’s primary case and the evidence of each of the witnesses.

10. [147]

    The respondent submitted that the primary judge’s inference that the respondent moved out of alignment because of panic induced by Mr Lofberg’s delayed observation of the chair was justified by findings that:

11. [148]

    These findings do not support the conclusion for which the respondent contends. It does not follow from the fact the respondent had, without incident, used many chairlifts in the past, including those which had their bars down, that the fact that she was injured on this occasion means that the conduct of Mr Lofberg or the appellant was somehow a cause of her injuries. Also, the findings do not mean that the reason for the respondent’s alleged panic was induced by her perception as to Mr Lofberg’s late realisation that the bar was down.

12. [149]

    Causation is concerned with whether the injuries for which a plaintiff seeks damages are referable to the breach of the defendant’s duty of care. The primary judge found that the relevant breach was Mr Lofberg’s failure to observe the condition of the incoming chair at the point where it exited the bullwheel and his failure to position himself such that had he made the observation at this time he would have been able to raise the down bar before the chair came within half a metre of the skiers. The principles applicable to causation are governed by s 5D of the Civil Liability Act:

13. [150]

    Section 5E then provides:

14. [151]

    The effect of these provisions is that respondent bore the onus of proving that Mr Lofberg’s delayed observation of the down bar condition of the oncoming chair produced panic or apprehension that caused the respondent to move out of the correct position and alignment that she had adopted on her arrival at the loading point.

15. [152]

    There was no direct evidence that either the respondent or either of her companions panicked because of Mr Lofberg’s delayed observation of or reaction to the down-bar condition of the chair. It is accepted that the respondent and her companions were correctly aligned immediately after they arrived at the loading point and that the respondent was out of alignment by the time the chair arrived at the loading point. Essential to her case in negligence was proof that she moved out of alignment because of apprehension and that that apprehension was induced by her realisation of Mr Lofberg’s failure to observe the state of the chair sooner than he did, so that it continued to approach them with the bar still down. She was required to establish that as a matter of inference.

16. [153]

    The relevant standard for determining when such inferences can be drawn is stated in Jones v Dunkel [1959] HCA 8; 101 CLR 298 at 305, Dixon CJ quoted the following passage in the judgment of the High Court in Bradshaw v McEwans Pty Ltd (HCA, unreported, 27th April 1951):

17. [154]

    To like effect is the statement by Dixon, Fullagar and Kitto JJ in Luxton v Vines [1952] HCA 19; 85 CLR 352 at 358:

18. [155]

    Mr Nowland gave evidence that:

19. [156]

    To similar effect, Mrs Nowland gave evidence that:

20. [157]

    Further, Mrs Nowland said “[w]e all realised in horror the safety bar was down and we had nowhere to go. We all tried to leap out of the way". The primary found (at [66] and [72]) that he was “prepared to accept that as a description of her reaction and not necessarily that of her husband or Dr Nair-Smith.” There was thus some evidence that at least one of the skiers attempted unsuccessfully to move out of the path of the chair.

21. [158]

    The respondent gave evidence that:

22. [159]

    The respondent and her companions did not give evidence that they were in a state of panic. However, it can be inferred from the evidence above that they were in a state of apprehension as the chair with its bar down approached them. Their evidence was corroborated by Mr Lofberg who gave evidence that they “seemed to panic” and who stated in cross examination that “I just remember vaguely, them sort of shuffling for position. Maybe they were panicking because the bar was down, worried that they weren't going to get on the lift properly". It may well be that their apprehension did not rise to the level of panic. However, the problem for the respondent concerns the onus she bore of proving that that apprehension was a product of Mr Lofberg’s delayed observation of the down-bar situation and that that apprehension caused her to move out of alignment, that being the breach of duty that was alleged and that the primary judge found. More precisely, the respondent’s problem concerns the source of the apprehension and the time at which it began. The respondent needs to prove that but for the inattention and delayed reaction of Mr Lofberg, she would not have moved out of alignment.

23. [160]

    The evidence shows that the respondent and her companions adopted the correct position and alignment upon reaching the load line and came to be concerned about the condition of the approaching chair very soon afterwards. Mr Nowland and Mrs Nowland both saw the down-bar state of the chair to their left as the chair approached the bullwheel at the final stage of its downhill journey. They immediately called out. The respondent was thereby alerted. All three of them were aware of the down-bar state of the chair before it completed its downhill journey and entered the bullwheel and, therefore, before there was either any occasion for Mr Lofberg to attend to the bar or any ability on his part to do so. They saw that the bar was still down when the chair exited the bullwheel (there was, of course, no way of raising it while the chair was passing around the bullwheel). The unavoidable inference is that the respondent and her companions began to be concerned because the bar was down as the chair approached the bullwheel; that their apprehension continued upon the chair’s exit from the bullwheel with the bar still down; and that that apprehension was not occasioned by inattention on Mr Lofberg’s part at any point at which he could, by exercise of reasonable care, have rectified the situation.

24. [161]

    Mr Lofberg’s continuing inattention at and after the point at which the exercise of reasonable care required him to act no doubt caused the already existing apprehension to continue and may have caused it to increase but it does not follow that his continuing inattention and failure to act were a necessary condition of the respondent moving out of alignment. The evidence does not allow a finding that the respondent moved because of apprehension produced by Mr Lofberg’s inattention at a point at which he could and should have acted (but did not) rather than because of apprehension that began before the chair entered the bullwheel and persisted thereafter. It was for the respondent to prove when and why she came to move out of alignment. The obvious difficulty for the respondent is that she did not provide reasons or adduce evidence as to why she moved out of alignment. To do so would have been contrary to the primary case that she sought to make.

25. [162]

    There could be any number of reasons why the respondent was out of alignment with the chair. Her ski may have slipped to the right at some point during the loading process. Her misalignment may have been caused by simple inadvertence on her part. Her biomechanics may have meant that her hips shifted to the right as she looked over her left shoulder to observe the approaching chair. There is also, of course, the possibility that she moved after the time at which the exercise of reasonable care required Mr Lofberg to act and that the more probable cause of the movement was his failure to exercise reasonable care at that time. However, it is equally likely she moved before the time at which the exercise of reasonable care required Mr Lofberg to act.

26. [163]

    The course of common experience does not establish why any one of these explanations is the more probable inference that ought to be drawn in the circumstances. The various explanations do no more than suggest competing inferences of equal degrees of probability so that any choice among them is no more than speculation. For the primary judge to conclude that the cause of the respondent’s misalignment was the consequence of jostling in reaction to the chair coming so close with its safety bar down due to Mr Lofberg’s reaction after the time reasonable care required him to act was a matter of mere conjecture. The evidence does not allow a finding that the events that in fact happened accorded, as a matter of probability, with this possibility.

27. [164]

    That being so, it was not open to conclude that the breach of duty found by the primary judge was causative of the respondent’s move from her original position. For that reason, it was not open to his Honour to conclude that the appellant’s breach was a necessary condition of the occurrence of the harm for which the respondent sought damages.

Issue 6: Materialisation of an inherent risk

1. [165]

   The appellant submitted that no liability can flow from the respondent’s breach of its duty of care because the respondent’s injury was the consequence of “the materialisation of the small chance of harm necessarily inherent in the interaction between persons taking their seat and the mechanical limitations of the chair within the meaning of s 5I of the CLA”. Section 5I is in the following terms:

2. [166]

   The primary judge dealt with this issue below as follows:

3. [167]

   In order for there to be no liability for the materialisation of an inherent risk it must be proven, inter alia, that the risk “cannot be avoided by the exercise of reasonable care and skill”. The relevant risk in this case is that a skier may sustain physical injury as a result of his or her reaction to the manner in which a lift operator responds to a down bar situation. As stated at [137] above, this risk could have been avoided had Mr Lofberg observed the state of chair as it left the bullwheel. The relevant risk is therefore not of the character described in s 5I. We agree with the primary judge.

Conclusions on negligence

1. [168]

   For the reasons stated, the primary judge was correct to have found that the appellant breached its duty of care in negligence owed to the respondent. However, he should have found that the negligence of the appellant was not causative of the injury suffered by the respondent.

2. [169]

   The action for damages for negligence should have been dismissed.

Issue 7: The Trade Practices Act claim

1. [170]

   The statutory warranty that, on the respondent’s case, was incorporated into her contract with the appellant was an implied warranty that the ski lift services provided by the appellant would be “rendered with due care and skill”.

2. [171]

   The conclusions in relation to the negligence claim mean that there was no breach of such an implied warranty.

Remaining matters

1. [172]

   The conclusions just stated with respect to negligence and the statutory warranty mean that the outcome of the appeal does not turn upon any of the other matters raised by the grounds of appeal and canvassed in submissions.

2. [173]

   For the sake of completeness, however, we proceed to deal with those other matters.

Issue 8: Section 109 inconsistency

1. [174]

   The primary judge held that the appellant breached its implied contractual obligation to render its services with “due care and skill” pursuant to s 74(1) of the Trade Practices Act as it stood at the relevant time. Section 74(1) relevantly provided:

2. [175]

   His Honour held that the quantum of damages recoverable for the breach of the implied warranty was not limited by Part 2 of the Civil Liability Act. He considered himself bound by Wallis to find that the Part 2 limitations were inconsistent with the right to “full contractual liability” conferred by s 74 of the Trade Practices Act. Under s 109 of the Constitution, s 74(1) of the Trade Practices Act prevailed and Part 2 of the Civil Liability Act was invalid to the extent of the inconsistency.

3. [176]

   The appellant submits that the primary judge erred in finding that the right to “full contractual liability” found in Wallis to be conferred by s 74(1) was inconsistent with the operation of the limit created by Part 2 of the Civil Liability Act. The essence of the appellant’s submission is that Part 2 of the Civil Liability Act regulates the quantification and measure of damages whereas s 74(1) does not. According to the appellant, “there is nothing in the Trade Practices Act or any other Federal legislation which regulates the measure of damages for breach of contract [with] which the CLA can ‘impair’ or conflict”.

4. [177]

   In his first judgment, the primary judge expressed the tentative view (at [123]-[124]) that the respondent’s claim in contract for breach of the warranty implied by s 74(1) of the Trade Practices Act was not subject to Parts 1A and 2 of the Civil Liability Act. However, as the matter raised constitutional issues of some significance, he considered it appropriate to stand the matter over until further submissions could be made. Those submissions were heard on 9 September 2013. His Honour delivered a judgment on 4 October 2013 in which, after summarising the applicable principles in Wallis (at [7]-[10]), he made the following observations:

5. [178]

   In Wallis, the Queensland Commissioner of Police entered into a contract with Downard-Pickford for the carriage of the goods of one Wallis from Ayr to Derby. The contract contained an implied obligation on Downard-Pickford to render its services with due care and skill by virtue of s 74(1) of the Trade Practices Act. Wallis’ goods were damaged in transit through Downard-Pickford’s failure to exercise due care and skill. The damage was quantified at $1,663.47. The issue was whether Downard-Pickford could rely on the limits on liability imposed by s 6(1) of the Carriage of Goods By Land (Carriers’ Liability) Act 1967 (Qd) (“Carriers Act”) in answer to Wallis’ claim for breach of the term implied by s 74(1). Section 6(1) provided:

6. [179]

   Section 6(1) was deemed to be incorporated into any such contracts of carriage by s 9(1). Section 9 was as follows:

7. [180]

   In Wallis, the appellant submitted that s 74(1) creates a contractual liability and a correlative contractual right to a “full contractual remedy”. As the appellant did in these proceedings, the respondent in Wallis submitted that s 74(1) says nothing about the measure or quantification of damages that may be recovered for breach of the implied warranty and does not impliedly make provision for the quantum of damages. Toohey and Gaudron JJ (with whom Deane, Dawson and McHugh JJ relevantly agreed) impliedly rejected the respondent’s submission in holding (at 396-397) that:

8. [181]

   In obiter, Toohey and Gaudron JJ discussed whether s 6(1) could operate independently of s 9(1) and expressed the tentative view that it could not. The critical finding by their Honours was that “the warranty created by s 74(1) carries with it full contractual liability for breach”.

9. [182]

   Wallis was referred to by this Court in Insight Vacations v Young [2010] NSWCA 137 (“Insight”). An issue there was whether s 74(2A) of the Trade Practices Act picked up and applied s 5N of the Civil Liability Act. Section 74(2A) provides:

10. [183]

    The primary judge referred to three passages in Insight. In the first (at [98]) Basten JA said:

11. [184]

    Sackville AJA said (at [143]):

12. [185]

    The third passage referred to the Second Reading Speech, Consideration in Detail Speech and Explanatory Memorandum for the Treasury Legislation Amendment (Professional Standards) Act 2004 (Cth), which introduced s 74(2A): see Spigelman CJ at [43]-[45]. The extracts from those documents suggest that parliament’s intention in enacting the legislative amendment was to ensure, among other things, that damages for breach of the implied warranty be subjected to any State and Territorial statutory regimes that limit or regulate the quantification of damages in contract. The Parliamentary Secretary moving the legislative amendment made the following statement in the Consideration in Detail Speech:

13. [186]

    The Supplementary Explanatory Memorandum issued with respect to the legislative amendment enacting s 74(2A) stated that:

14. [187]

    This Court’s reasoning in Insight suggests that the legislature’s purpose in introducing s 74(2A) was to address a concern that any attempt by State or Territory legislatures to regulate quantum or measure of damages recoverable for a breach of the term implied by s 74(1) would be inconsistent with s 74(1) because of the High Court’s decision in Wallis. The Court found that s 74(2A) picked up and applied s 5N and therefore that no inconsistency arose. Section 74(2A) came into effect on 13 July 2004. It did not purport to have a retrospective effect. Section 74(2A) only applies to contracts entered into after it came into effect. The contract between the respondent and the appellant was entered into on 17 July 2003. Section 74(2A) therefore has no effect on the contract presently under consideration.

15. [188]

    According to the primary judge, “full contractual liability” means “damages assessed at common law”. Thus, the right granted by the Commonwealth Act is the right to have one’s damages assessed according to common law. As Part 2 of the Civil Liability Act purports to limit the amount of damages recoverable for breach of the implied warranty to something less than the full amount that would be available at common law, it is inconsistent with s 74(1) and invalid accordingly. The primary judge’s interpretation of Wallis is consistent with the Court of Appeal’s remarks in Insight.

16. [189]

    The appellant submits that Wallis is distinguishable from the present case because, in Wallis, s 6(1) of the Carriers Act was incorporated into the contract of carriage pursuant to s 9(1) of the Act so that both s 6(1) and s 74(1) formed part of the same contract and it would have been impossible to obey both terms and thus both laws. The impossibility of performing both contractual obligations therefore gave rise to direct inconsistency.

17. [190]

    That characterisation of the decision in Wallis cannot be accepted. Toohey and Gaudron JJ addressed the issue of whether s 6(1) could have effect and operate independently. They said (398-399):

18. [191]

    Thus Toohey and Gaudron JJ did not express a concluded view on whether s 6(1) only had force and effect by virtue of s 9(1) but they did find that s 9(1) was invalid to the extent that it incorporated s 6(1) into contracts for carriage to which s 74(1) applied. It is clear that the High Court considered that s 6(1) was inconsistent with s 74(1) irrespective of whether it was incorporated into the contract or had independent statutory force. What was material in Wallis was that s 74(1) conferred a right that s 6(1) purportedly qualified. It was this that constituted the inconsistency. The means by which the attempted qualification by State law is effected does not matter. The fact s 6(1) was incorporated into the contract for carriage, whereas the Civil Liability Act provisions are not is not a sufficient basis for distinguishing Wallis from the present case.

19. [192]

    It is not immediately obvious how s 74(1) regulates the measure and quantification of damages, even in light of the High Court’s decision in Wallis and its subsequent interpretation by the Court of Appeal in Insight. The High Court held that a right to “full contractual liability” inhered within the creation of the implied warranty by s 74(1). The Court did not elaborate on what was meant by that expression. The summaries of Wallis in Insight suggest that the phrase concerns the amount of damages that are recoverable for a breach of the implied warranty. This reading of Wallis seems to follow inexorably from the fact that s 6(1) purported to limit the amount of damages recoverable for a breach of the implied warranty and that was said to be the source of the inconsistency. If s 6(1) regulates the amount of damages recoverable for a breach of 74(1) and s 74(1) is inconsistent with s 6(1), s 74(1) must regulate the measure of damages recoverable for breaches of the term implied by it otherwise no inconsistency would arise.

20. [193]

    Once it is accepted that s 74(1) regulates the quantification of damages, the question becomes how, precisely, does it do that. On its face, s 74(1) says nothing about how damages are to be assessed and quantified. Recourse must be had to the statement in Wallis that it confers entitlement to “full contractual liability”.

21. [194]

    The phrase “full contractual liability” must be understood as a reference to the full amount of damages recoverable at common law undiminished by any State’s or Territory’s legislation and free from any intrusion by such legislation.

22. [195]

    The primary judge correctly held that Part 2 of the Civil Liability Act is directly inconsistent with s 74(1) of the Trade Practices Act and invalid to that extent. The damages the respondent can recover for breach of s 74(1) are to be determined in accordance with the principles applicable at common law and are not subject to the limitations contained within Part 2 of the Civil Liability Act.

Issue 9: Efficacy of Perisher’s contractual exclusion clauses

1. [196]

   The primary judge found that the terms of the ticket contract excluding the appellant’s liability for breach of the term implied by s 74(1) of the Trade Practices Act were rendered void by s 68. The appellant submits that the primary judge ought to have found that the warranty implied by s 74(1) was excluded from the contract by the application of s 68B and s 4L of that Act. A term of a contract will be rendered void by s 68 if it purports to exclude, restrict or modify or has the effect of excluding, restricting or modifying the warranty implied by s 74. Section 68 is in the following terms:

2. [197]

   Both parties accept that the term implied by s 74 forms part of the contract between them and that s 68 will operate to render void any term of that contract that purports to qualify the application of s 74 unless the exception in s 68B applies. Section 68B relevantly provides that:

3. [198]

   At trial, the appellant contended that it excluded the operation of s 74(1) and also any liability under Part 1A of the Civil Liability Act by reason of the written terms on the reverse side of the ticket and the operation of s 5N(1) of the Civil Liability Act. The terms on the reverse side of the ticket relevantly stated:

4. [199]

   The primary judge found that the wording of the liability of the exclusion did not fall within s 68B because the ticket contract was not for the supply of “recreational services” within the definition of s 68B(2), but rather was only for the provision of “transportation services up the ski slopes and between some ski slopes”. The primary judge’s reasoning proceeded as follows (at [105]-[106]):

5. [200]

   The appellant submits that this is too narrow a characterisation of the purpose for which the contract was entered into and of the services for which it provided. In addition to providing a purchaser of a ticket with a means of being transported up the mountain in order to ski, the appellant also provided that purchaser with slope grooming services, pistes, snow making facilities, ski patrol services and a whole array of other ski resort facilities that could be enjoyed once the carriage had been completed. The ticket contract was not only for the transportation of skiers up and between ski slopes but for the full array of skiing facilities that the appellant provided.

6. [201]

   The primary judge drew a distinction between “services that directly facilitate participation and some which are only ancillary, e.g. transport”. But, “transportation” in the form of conveyance by chairlift to a point from which skiing and use of skiing facilities can be undertaken should not be regarded as merely “ancillary”. Lifting services form a central aspect of alpine skiing in its modern form. There are, of course, other means of being conveyed up a ski slope. Some skiers prefer hiking while others, particularly intrepid skiers, use helicopters and skidoos to access ski terrain. However, for most skiers at established resorts such as Perisher, the use of lifting services is essential to their participation and enjoyment of the particular form of recreation. The common intended purpose and object of the transaction was to facilitate resort skiing which included, but was not limited to, the provision of lifting services. The primary judge was in error in finding that the ski lifting services provided by the appellant did not fall within the definition of “recreational services”.

7. [202]

   The appellant also submitted that even if the purpose of the contract was only transportation services, the primary judge erred in finding that “being transported up a ski slope and between ski slopes is not participating in a sporting activity”.

8. [203]

   Section 68B relevantly defines “recreational services” as “a sporting activity or a similar leisure‑time pursuit”. While riding on chairlifts may aptly be characterised as a “leisure time pursuit” it is in no way similar to “a sporting activity” and therefore falls outside the relevant definition.

9. [204]

   Even if it is accepted that the ticket contract was for the supply of “recreational services” within the definition of s 68B(2), the primary judge found that there is a “further obstacle in the face of Perisher's attempt to invoke s 68B”. According to his Honour (at [107]):

10. [205]

    At [93] and [95] the primary judge stated:

11. [206]

    The primary judge applied those principles to what he considered to be the three “potentially relevant” exclusion “terms” in the ticket contract. The first term read as follows:

12. [207]

    The primary judge found that this term did not purport to exclude or modify the appellant’s liability in negligence (at [110]). Further, his Honour did not consider that it operated to exclude the term implied by s 74(1) of the Trade Practices Act because its operation is limited by the words "permitted by law" and the Act does not anywhere provide such permission. The appellant did not challenge these findings.

13. [208]

    The second potentially relevant term considered by the primary judge provided that:

14. [209]

    The primary judge found that this term neither purported to exclude the appellant’s liability in negligence nor fell within the exception to s 68 of the Trade Practices Act contained in s 68A for reasons set out at [98] of the first judgment. These findings are not challenged. However, the primary judge also found that s 68B could not be invoked for the reason set out at [199] above and because the restriction or modification sought to be made by the term is not limited to liability for death or personal injury, for that further reason, s 68B(1) was not engaged. While the first of these reasons cannot be accepted (see [201] above), the second reason is valid. It follows that this term was rendered void by s 68(1). We agree with the primary judge’s reasoning in this regard.

15. [210]

    The third potentially relevant term was as follows:

16. [211]

    The primary judge held (at [115]) that this clause purports to exclude the liability of Perisher for negligence and breach of the term implied by s 74; that s 68A did not apply for reasons that are not in issue in this appeal; that s 68B did not apply for the reason extracted at [199], which cannot be accepted (see [201] above); and, that even if s 68B could be invoked, the exclusion sought to be given effect to by this term is not limited to liability for death or personal injury so that for that additional reason s 68B(1) was not engaged. Consequently, the effect of s 68 was to render the entire “term” void.

17. [212]

    The appellant submits that the primary judge erred in failing to apply s 4L of the Trade Practices Act so as to sever the words “or to property” (or perhaps “whether… or to property”). Section 4L is as follows:

18. [213]

    In Motorcycling Events Group Australia Pty Ltd v Kelly [2013] NSWCA 361; 86 NSWLR 55 at [116]-[120] Gleeson JA said:

19. [214]

    Basten JA said (at [15]-[16]):

20. [215]

    Meagher JA agreed with Basten JA (at [41]) and stated:

21. [216]

    The effect of the similar approaches taken by Gleeson JA and by Basten JA and Meagher JA is that any provision that purports to exclude liability for more than personal injury or death will not answer the description in s 68B(1)(d) of the Trade Practices Act and will be, by force of s 68, void in its entirety and not just to the extent that it purports to exclude, restrict or modify liability for anything beyond personal injury or death. The third “potentially relevant” exclusion clause purports to exclude liability for more than personal injury and death as it extends to liability for “property”. The term is void in its entirety and those parts of it which extend the scope of its exclusion cannot be severed so that it meets the description in s 68B(1)(d).

22. [217]

    It remains to be determined whether s 4L of the Trade Practices Act has any effect on the conclusion just stated. At [96] the primary judge said:

23. [218]

    Section 4L is only engaged if the inclusion of a particular provision in a contract contravenes a particular provision of the Trade Practices Act. The appellant has not identified a relevant contravention of the Act that would trigger the application of s 4L. The inclusion of a term which purports to avoid the application of the warranty implied by s 74 is rendered void by s 68 and is therefore of no effect. It is unnecessary in this appeal to express a view concerning the effect of s 4L as it has no application to the issues under consideration.

24. [219]

    As we have reached the same conclusion as the primary judge regarding the validity of the purported exclusion clauses in the ticket contract, albeit, to some extent, by a different route, the primary judge’s conclusion (at [117]) that the “consequence of the above conclusions is that Dr Nair-Smith is not contractually excluded from suing for negligence at common law and Perisher’s attempt to rely on s 5N of the CLA fails” must stand. Even though we differ from his Honour on the question of whether the contract was for supply of “recreational services” within the meaning of s 68B(2), there is nevertheless no valid contractual waiver of liability to which s 5N could apply. It is therefore not necessary to decide whether s 5N of the Civil Liability Act is rendered void by s 68.

Issue 10: Quantum of damages

1. [220]

   The appellant makes two challenges to the primary judge’s findings in relation to the respondent’s post-accident functional work capacity. First, the appellant submits that the primary judge erred in finding that the respondent experienced any diminution in her earning capacity after she returned to work on 8 July 2003. Second, the appellant submits that the primary judge erred in finding that any diminution in the respondent’s functional work capacity following her injury on 18 July 2003 was attributable to that injury.

2. [221]

   The primary judge made several findings about the respondent’s functional work capacity following the injury. He found that she was unable to return to work from the date of injury until 8 August 2003; that from that date until December 2008 she reduced her working hours by half a day per week; and that she reduced her work hours by a full further day per week from December 2008.

3. [222]

   The appellant does not challenge the primary judge’s finding that the respondent was unable to return to work from the date of injury until 8 August 2003. The appellant also accepts that the respondent stopped working half a day on Fridays from 8 August until December 2003 and further reduced her working days thereafter. However, it submits that the respondent’s overall working hours did not decrease after she returned to work following her accident notwithstanding that she was only working half a day on Friday and that any decrease in her working hours ought to have been attributed to a natural deterioration of the respondent’s pre-existing lumbosacral condition.

4. [223]

   The appellant relied on the following evidence in support of its submission that the respondent did not experience any reduction in earning capacity after she returned to work on 8 August 2003:

   1. (1)

      The respondent accepted in cross-examination that she “returned to full-time work duties on 28 August 2003” and was working “50-60 hours per week” between “February and August 2004”.

   2. (2)

      A letter from Jeremy Wright, a financial consultant to the respondent, dated 8 September 2005 to an insurer stating that “Dr Nair-Smith has been back to work for 2 years without any time off”.

   3. (3)

      In insurance claim documents signed and dated 9 November 2005, the respondent stated that she normally worked 55 hours per week before the incident and worked the “same” during the 12 months prior to November 2005.

   4. (4)

      The respondent had 10 days off work in October 2004 because her condition deteriorated during a period in which she was “undertaking” pilates.

   5. (5)

      The respondent accepted in cross-examination that on 29 October 2008 she informed her physiotherapist, Ms Harkin, that she was working 12 hours per day, 4 days per week.

   6. (6)

      Medicare records show that the fluctuations in the respondent’s client servicing rates in the years after the incident were comparable to other doctors at the practice at which she worked.

   7. (7)

      The respondent’s earnings from personal exertion increased by 33% in the financial year 2009.

   8. (8)

      In her amended statement of particulars dated 3 May 2007, the respondent claimed damages for the time she spent off work from 18 July 2003 to 31 August 2003 and for past and future loss of earning capacity as a medical practitioner.

5. [224]

   The appellant also placed reliance on the lack of documentary evidence adduced by the respondent to corroborate her assertion that she was working fewer overall weekly hours after the incident and not just fewer days. The appellant submits the respondent maintained her full-time pre-injury working hours of 50-60 hours per week after her return to work on 8 August 2003 without a reduction in patient servicing even though she was only working half a day on Friday.

6. [225]

   The primary judge addressed much of this evidence and the lack of corroborating documentary evidence in his reasoning: [247]-[279]. He found that the respondent reduced her working hours by half a day on Friday after her accident and further reduced her hours after 1 December 2008. The primary judge recognised that there was evidence given in cross-examination by the respondent and contained within insurance claim documents that was inconsistent with these findings. He dealt with these inconsistencies in his reasoning: [268]-[271]. The appellant did not take issue with the primary judge’s reasoning in this regard. His Honour based his finding on a considerable body of affidavit and testimonial evidence that supported his finding. While the primary judge expressed certain reservations about the credibility of the respondent, for the most part he found her to be intelligent and honest. His Honour had the advantage of seeing the demeanour of the respondent at trial to assist his assessment of the credibility and reliability of her evidence. The evidence to which the appellant took this Court does not justify appellate intervention in what is in essence an evaluative exercise.

7. [226]

   In any event, the appellant submits that the primary judge erred in finding that the respondent’s diminished work capacity was attributable to the injuries that she sustained on 18 July 2003 and that his Honour should have found that any of respondent’s diminished work capacity after she returned to work was a product of a natural deterioration of her pre-existing lumbosacral condition. Accordingly, the relevant issue is whether the respondent’s diminished work capacity is attributable to a natural deterioration in her pre-existing lumbosacral condition or an exacerbation of that condition caused by her injury on the ski fields. The primary judge concluded:

8. [227]

   The appellant submits that that finding is against the weight of the evidence and that the primary judge failed to address the critical issue of reliability in his reasoning. The crux of the appellant’s submission is that the respondent’s evidence is unreliable because her attribution of the pain she was experiencing to the chairlift incident was a product of her “psychological obsession” with her injuries and that insofar as the evidence of the respondent’s family, those close to her and certain doctors was based upon her opinion regarding the cause of her injuries, it too is unreliable. In particular, the appellant submits that the respondent’s narration of her medical history to Dr Giblin was so inadequate that his subsequent diagnosis based upon it cannot be relied on.

9. [228]

   The appellant took the Court to the joint opinion of Dr Clark and Dr McClure that the respondent was “overly preoccupied with her accident, injury and disabilities to the point where psychological intervention was justified”. This opinion was given in the course of an advice concerning whether the respondent required psychological treatment following her accident. When their opinion is read in context, it is clear that it has nothing to do with whether the respondent was capable of reliably accounting for the cause of her pain. Under a heading that reads “Issues on which the Experts agree”, the report records the following:

10. [229]

    This suggests that it was the joint expert opinion of Dr Clark and Dr McClure that the respondent was suffering “ongoing physical symptoms” as a result of her accident on 18 July 2003 and not that she was imagining a connection between the pain she was experiencing and subject accident. Further, the appellant submits that the primary judge erred (at [288]) in rejecting the evidence of Dr Clark and Dr McClure “solely on the basis of the primary judge’s observation of the respondent in Court that she ‘did not appear to be obsessed or pre-occupied with the circumstances of the incidence’”. In the judgment at [288], his Honour stated that he rejected “Dr Clark’s diagnosis of a post-traumatic stress disorder for the reasons given by Dr McClure”. He extracted those reasons at [286]. Dr McClure rejected Dr Clark’s diagnosis because, in his opinion, the respondent’s symptoms were not consistent with those of a post-traumatic stress disorder. That is good reason for rejecting a diagnosis. The primary judge was entitled to prefer the evidence of Dr McClure over Dr Clark on that basis. He also considered the evidence of Dr Clark and Dr McClure that the respondent was “continuing to experience significant pain even though other branches of medicine cannot identify a precise organic cause”.

11. [230]

    The appellant then took the Court to the evidence of Dr Maxwell, Associate Professor Jones and Dr Giblin that the respondent faked a Trendelenberg’s sign; the respondent’s concession that she wrongly denied her history of paralysis, migraine and joint pain, arthritis, bone and spine trouble in an insurance proposal dated 30 June 1990; the respondent’s failure to disclose to Dr Clarke and Dr McClure that she had previously seen medical specialists to treat and investigate the cause of her lumbosacral pain over the 14 years prior to her injury and had supposedly exaggerated her skiing ability to them; and the respondent’s supposed admission in cross-examination that she advised Dr Lee that the X-ray had revealed a separation of the pubis in circumstances where Dr O’Connor had advised her to the contrary. The primary judge considered the evidence of Dr Maxwell, Dr Stening and Associate Professor Jones and gave his reasons for not accepting it at [295]-[311] and dismissed this supposed admission as “an instance of [the respondent] falling into difficulties in the face of a skilful cross-examiner, and does not reveal dishonest conduct on her part”. The fact that the respondent misrepresented her medical history in 1990 and to Dr Clarke and Dr McClure does not suggest that she was under some sort of misapprehension about the cause of her injuries. Rather, it suggests that she was knowingly dishonest as she must have known that she had been experiencing pain and would have had detailed knowledge of her medical history. This evidence goes to credibility and not reliability.

12. [231]

    Finally, the appellant submits that the primary judge’s evidence was against the weight of the contemporaneous medical and financial records. Most notably, the appellant drew the Court’s attention to the fact that the respondent underwent far less medical treatment in the areas supposedly affected by her accident after it occurred than before. The primary judge dealt with the evidence going to the respondent’s pre- and post- injury medical treatment at [204]-[218] and [219]-[246] respectively. Although he did not engage in the kind of comparative analysis proposed by the appellant, it is nevertheless clear from the primary judge’s reasoning that he considered this evidence in detail and makes it plain that he was under no misapprehension about this evidence and the weight to be given to it.

13. [232]

    The principle applicable to appellate review of damages awards was stated by Mason J in Wilson v Peisley (1975) 50 ALJR 207:

14. [233]

    When one examines the medical evidence there is a sufficient basis upon which the primary judge’s findings can be supported. In his report dated 4 December 2006, Dr Giblin provided the following diagnosis and prognosis:

15. [234]

    As the primary judge stated (at [293]), Dr Giblin’s subsequent reports dated 27 April 2009 and 3 August 2010 confirm this provisional diagnosis.

16. [235]

    The appellant has failed to demonstrate relevant error by the primary judge in assessing the evidence regarding the cause of the respondent’s pain and, therefore, diminution of functional work capacity.

17. [236]

    The appellant submits that the primary judge should have awarded no damages for domestic assistance, paid or gratuitous, following the respondent’s return to work for the same reasons it submits the primary judge should not have awarded damages for diminution of functional work capacity. It follows that this submission should be rejected for the reasons given above.

18. [237]

    Alternatively, the appellant submits that the primary judge erred in awarding damages for paid domestic assistance at a rate of $30 rather than adopting the rate of $14.58 that the respondent was paying a certain Ms Callas. The primary judge determined that $30 was the appropriate market rate for the domestic services required by the respondent by taking the rate opined by Ms Walters, an occupational therapist, to be the current home care rate and discounting it in light of the rate at which Ms Callas was willing to work and the level of average earnings. The appellant submits that the primary judge should have calculated the market rate for the services required by the respondent by reference to the rate she was actually paying for those services and not the hypothetical rate opined by Ms Walters for specialised medical care the respondent did not need. Ms Walters described the assistance the respondent would require as follows:

19. [238]

    The rate proposed by Ms Walters was for the provision of assistance with ordinary domestic tasks and not for the provision of specialised medical care. The respondent is entitled to be compensated for her future paid domestic assistance requirements at the market rate. In Griffiths v Kerkemeyer [1977] HCA 45; 139 CLR 161 Mason J stated (at 192-193) that:

20. [239]

    There is no principled basis for not extending this principle to the provision of services provided at less than a market rate. A sample size of one is generally a poor indicator of what the market is willing to pay for the provision of a particular service. The primary judge was entitled to prefer the professional opinion of Ms Walters, subject to certain qualifications, over the rate that the respondent happened to be paying Ms Callas when determining the market value of paid domestic assistance, especially as it is not certain whether and for how long Ms Callas will continue to provide her services at that rate, if at all. The appellant has provided no sound basis for overturning the primary judge’s findings with respect to domestic assistance.

Conclusion

1. [240]

   Since, for the reasons stated, breach of a duty of care owed by the appellant, although it occurred, was not causative of the injury sustained by the respondent on 18 July 2003, the award of damages made by the primary judge cannot stand. Had the conclusion on causation been otherwise, the appropriate course would have been to dismiss the appeal, since all other bases of challenge advanced by the appellant are unsustainable.

2. [241]

   Because the appellant has been successful on the issue of causation only, there is a question as to the appropriate costs order. Argument on the several matters on which the appellant failed represented the major part of the submissions as a whole. In those circumstances, the simple proposition that costs should follow the event requires re-evaluation. The success achieved by the appellant on the single (but decisive) issue of causation and the success achieved by the respondent in resisting all other grounds of appeal will best be reflected by an order that the respondent pay one-half of the appellant’s costs of the appeal.

3. [242]

   The orders are: