Baden Cranes Pty Ltd v Smith; Brambles Australia Ltd v Smith

Brambles Australia Ltd (Appellant) Craig Lionel Smith (First Respondent) Baden Cranes Pty Ltd (Second Respondent) Gillespies Cranes Nominees Pty Ltd (Third Respondent) Representation: Counsel:

G Curtin SC/D Macfarlan (Baden Cranes) M Joseph SC (Brambles Australia) L King SC/H Kelly SC/T McKenzie (Craig Smith) S M Kettle (Gillespies Cranes) Solicitors:

Riley, Gray-Spencer Lawyers (Baden Cranes) McCabe Terrill Lawyers (Brambles Australia) Taylor & Scott Lawyers (Craig Lionel Smith) Hicksons Lawyers (Gillespies Cranes) File Number(s): CA 2006/267240; CA 2012/8069 Decision under appeal Jurisdiction: 9111 Citation: Smith v Brambles Australia Ltd [2011] NSWSC 1518 Date of Decision: 2011-12-09 00:00:00 Before: Schmidt J File Number(s): SC 2006/267240

HEADNOTE [This headnote is not part of the judgment] In November 2002, the plaintiff was operating a crane at Darling Harbour, Sydney. Shortly after commencing operation, the upper deck of the crane toppled off the base. The plaintiff was thrown to the ground, suffering significant injuries. The plaintiff sued three parties in negligence. The crane had been manufactured to be transported in two parts. The crane manufacturer, Liebherr, was not joined in the proceedings. The crane had been purchased by Brambles (the first defendant). Brambles engaged Baden (the second defendant, and Liebherr's representative in Australia) to modify the crane, allowing it to be transported in one piece. The plaintiff was employed by Brambles and drove the modified crane for some months in that capacity. In August 2002 Gillespies (the third defendant) purchased Bramble's business, including the modified crane. At this time, the plaintiff's employment was transferred to Gillespies. Gillespies therefore owned the crane and employed the plaintiff at the time of the incident. To drive the modified crane safely required release of a "slew lock", which held together the crane base and superstructure. This involved two actions: moving three external levers and activating a switch inside the driver's cabin. If these steps were not taken, there was a risk that the pins connecting the two parts of the crane would shear if a turn were attempted. On the morning of the incident, the plaintiff failed to activate the relevant switch, and that risk materialised. The plaintiff was unaware of the potential consequences of driving the crane in one piece without releasing the slew lock. The trial judge found that he should have been warned of the possibility of the pins shearing if that course were taken. The trial judge found against all three defendants, and apportioned liability against Baden (45%), Brambles (35%) and Gillespies (20%). Baden and Brambles appealed from those orders. The issues for determination on appeal were: (i) whether each of Brambles and Baden breached a duty owed to the plaintiff; (ii) whether factual causation was established in circumstances where there were three consecutive negligent acts by three different parties; (iii) whether the casual link was broken by the intervening tortious conduct of another party; (iv) whether there was any contributory negligence by the plaintiff; and (v) how damages should be apportioned between the parties. The Court held (per Basten JA, Tobias AJA and Ward JA agreeing): In relation to (i)

1. Baden made the relevant modifications to the crane. It knew how the mechanism worked, what was required of the crane driver, and that the operator might inadvertently fail to release the slew lock. Therefore, Baden ought to have enquired of Liebherr as to the possible consequences of such an oversight. If informed that damage was likely, or not readily assessable, Baden's duty would have extended to considering a failsafe mechanism to prevent the crane being moved in one piece without the slew lock being released. Baden's negligence should therefore be upheld, but on the basis of its failure to provide such a mechanism, rather than its failure to provide a warning to the plaintiff, as relied on by the trial judge: [43]-[44].
2. Although Brambles did not itself modify the crane, as a crane operator it had sufficient understanding of the way in which the crane would be driven to realise that inadvertent failure to release the slew lock would significantly stress the crane structure. It therefore owed a duty of care to a class of people including crane operators for any damage flowing from a failure of the crane due to the lack of a relevant safety mechanism: [50] and [60]. McPherson's Ltd v Eaton [2005] NSWCA 435; 65 NSWLR 187 considered. In relation to (ii)
3. To determine causation in circumstances where there are three consecutive and related sets of negligent conduct by three different actors, s 5D of the Civil Liability Act 2002 (NSW) must be applied separately to each. Adopting one of the alternate safety mechanisms would have prevented the accident. Although the breach of any one of the defendants would not have caused the plaintiff's injury absent intervening tortious failures by each of the other defendants, each act of negligence was a necessary element in a set of conditions which, together, were sufficient to cause the harm: [46] and [66]. Strong v Woolworths Ltd [2012] HCA 5; 86 ALJR 267 considered. In relation to (iii)
4. Each subsequent tortfeasor in a chain should not escape liability for the sole reason that others before or after it were negligent. Where subsequent negligence is a reasonably foreseeable consequence of earlier negligence, it will not break the causal chain. Subsequent negligent acts of the same kind, as in this case, will be readily foreseeable consequences of the first negligent act: [72]. Voli v Inglewood Shire Council [1963] HCA 15; 110 CLR 74; Grant v Sun Shipping Co Ltd [1948] AC 549; Australian Shipbuilding Industries (WA) Pty Ltd v Packer (1993) 9 WAR 375; Chapman v Hearse [1961] HCA 46; 106 CLR 112; Erwin v Iveco Trucks Australia Ltd [2010] NSWCA 103 and Mahony v J Kruschich (Demolitions) Pty Ltd [1985] HCA 37; 156 CLR 522 considered.
5. Baden had no reason to believe that the risk that it created would be obviated by the owner of the crane. There is therefore no reason not to treat its negligence as causative of the harm: [73].
6. Though Brambles did not have control over the crane when the incident occurred, its failure to ensure that safety mechanisms were implemented and to train or warn future operators remained a significant cause of the accident: [74]. In relation to (iv)

Judgment 1BASTEN JA: On 3 November 2003, Mr Craig Smith ("the plaintiff"), was operating a Liebherr LTM 1225 mobile crane at Darling Harbour, Sydney. The crane comprised two main parts, namely a base and the superstructure which were connected by a "slew ring". Shortly after it commenced operation, the entire upper deck of the crane, including the boom, the crane cabin and the counterweight, toppled off the base, with the boom entering the water. Uncertain whether it was stable, the plaintiff quickly climbed out of the cabin, was jolted free and fell some four metres to the ground, causing significant injuries to his ankles, right wrist and other parts of his body. 2The cause of the accident requires reference to the history of the crane. Although characterised as a "mobile crane" it was manufactured to be transported in two parts, with a "quick connection" slew ring which allowed the superstructure to be removed from the base for the purpose of transporting the crane. That design had the disadvantage that a second crane was required to remove the superstructure when the crane was to be moved and replace the superstructure on the base when it reached its destination. Further, a second vehicle would be required to transport the superstructure. 3The crane had been purchased second hand by its previous owner, Brambles Australia Ltd ("Brambles") in 1998. Brambles sought to have the original design modified so that the crane could be transported without separating the superstructure from the base, by resting the boom on a separate trailer or "dolly". When the crane was operating, the superstructure was connected to the base by a bayonet entering the slew ring on the base, which was locked in place by two steel pins. That allowed the boom to be raised, lowered or rotated by the driver operating from the crane's cabin. When the crane was being transported with the boom attached to a dolly, the boom needed to be able to rotate freely in the horizontal plane so that the vehicle could manoeuvre around bends or corners. In addition, although not materially in terms of the present accident, the boom also had to be able to move in a vertical plane when going over bumps or depressions. That was described as a "luffing" movement. 4To release the slew lock, so as to allow the boom to move freely when in transport, there was an hydraulic pump system which had to be operated by the driver. Two separate actions were required, namely the release of the hydraulics by moving three levers situated on the base of the crane behind the vehicle's driving cabin and the operation of a switch within the driver's cabin which, when the engine of the vehicle was running, built up the necessary hydraulic pressure to release the slew lock. 5The system was well known to the plaintiff, who had operated it on "many, many, perhaps a hundred" occasions. However, on the morning of the collapse, he started to drive the vehicle out of the yard with the levers in their correct position, but without switching on the hydraulic pump. As a result, immediately he started to turn the vehicle as he left the yard, a large torque was applied to the slew ring which caused two locking pins holding the bayonet to shear. 6Once positioned at Darling Harbour, the crane made several lifts of its own counterweights which were stacked on the wharf so that the weights were positioned on the rear of the crane's base, and could be attached to the rear of the crane's superstructure. It was only when the counterweights had been attached and the crane again started to rotate that the superstructure toppled off the base. The timing of the collapse was explained by an engineer, Mr Richard Frost, who provided a report dated 27 November 2003 to the owner. He stated at paragraph 38: "In my opinion the two pins which were sheared off suffered that failure during the time the crane was being driven to the site earlier on the day of the incident. Until such time as the 65 tons of counterweight were attached to the rear of the crane superstructure, however, the superstructure assembly did not have sufficient inertia associated with it to twist the bayonet connector out of engagement. Once the 65 tons of counterweight were attached to the crane's superstructure, however, the superstructure assembly had a much greater inertia and the deceleration associated with the last slewing manoeuvre of the crane to the left caused the male component of the bayonet connector assembly to rotate to the disengaged position, as the two retaining pins had already sheared off. As soon as the bayonet connector moved to the disengaged position, the rearward weight biasing of the structure assembly, provided by the attached 65 tons of counterweight, caused the superstructure assembly to tilt rearwardly, and the bayonet connector assembly to separate completely. ... The crane's superstructure then fell to the wharf."

The trial proceedings 7The plaintiff sued three parties in negligence. The third defendant was Gillespies Cranes Nominees Pty Ltd ("Gillespies"), which owned the crane and employed the plaintiff at the time of the accident. (The unfortunate delay in the final resolution of these proceedings appears to have been caused, at least in part, by a dispute between the plaintiff and Gillespies as to whether the plaintiff had suffered a 15% whole person impairment, which was a precondition to him bringing a claim for workplace injury damages against his employer: Workers Compensation Act 1987 (NSW), s 151H.) 8The manufacturer of the crane was Liebherr-Werk Ehingen Gmbh, a German company, which was not joined in the proceedings. The modifications to allow the transport of the crane in one piece with a dolly were undertaken by a representative of Liebherr in Australia, namely G M Baden Pty Ltd, which later changed its name to Baden Cranes Pty Ltd ("Baden"). It was the second defendant in the proceedings below. The former owner, Brambles, was the first defendant. 9Broadly speaking, the cause of the accident was not controversial. However, there was disagreement as to responsibility for the error of the driver in failing to release the slew lock and the subsequent collapse of the crane. The dispute was as to which parties should have foreseen the risk which materialised and what steps should have been taken to mitigate the risk. Each defendant being found to have breached its duty of care, primarily by failing to give adequate instructions in relation to the consequences of failing to release the slew lock before driving the crane with the boom on the dolly, a further question arose as to causation, namely whether the failure to take such steps was a necessary condition of the occurrence of the harm. This required consideration, not fully addressed either before the trial judge or in this Court, of s 5D of the Civil Liability Act 2002 (NSW). 10Each of the defendants filed cross-claims against the others. At trial in the Common Law Division, Schmidt J found in favour of the plaintiff against each of the defendants: Smith v Brambles Australia Ltd [2011] NSWSC 963. Because damages were calculated on a different basis against the employer (Gillespies) and against the other defendants, the figures required careful consideration. Final orders were made in a second judgment on 9 December 2011: Smith v Brambles Australia Ltd [2011] NSWSC 1518. The trial judge found no contributory negligence on the part of the plaintiff and she apportioned liability for the accident against Baden (45%), against Brambles (35%) and against Gillespies (20%). Both Baden and Brambles have appealed from those orders. Gillespies filed a notice of contention seeking a further finding in relation to the terms of the sale agreement between it and Brambles, pursuant to which it acquired the crane, but did not appeal from the orders made. 11In order to understand the content of the duties upheld at trial, and the findings as to breach and causation, it is convenient to start by examining the sequence of events which led to the collapse of the crane.

Events leading to collapse 12About a month after the accident, the plaintiff was interviewed by an inspector from WorkCover New South Wales; the questions and his responses were recorded. He said he had been a crane operator with Gillespies and formerly with Brambles for a period of approximately one year eight months. His employment was transferred from Brambles to Gillespies when Gillespies purchased Brambles' mobile crane hire business, pursuant to an agreement dated 28 August 2002. 13The plaintiff gave evidence of a new luffing cylinder having been fitted without difficulty to the crane in Gillespies' yard a few days before the accident. He described the steps he had taken to prepare the crane for use on Monday, 3 November 2003, including the lowering of the boom onto the dolly on Saturday, 1 November. He stated that he had operated the manual levers on the Saturday, the function of which he stated was "to allow the jib to free slew and move up and down with the undulation of the road": Q36. He said there was no warning device on the crane to tell him if the slew lock was engaged or disengaged: Q37. He was then asked to identify from a photograph which of the switches in the cabin related to the slew lock: "Q38: I show you a photograph marked No 12 which shows the carrier cabin. Can you indicate whether any of these switches relate to the slew lock? A: Yes and it works in conjunction with the slew levers when the levers are in dolly position the marked switch has to be switched on. It flashes an illumination and then goes off. Q39: On the day you went to darling harbour had you switched it on? A: No initially? Q40: Could you please explain further? A: When I drove down the driveway the felt fine [sic], as I went out the gate and turned left the steering didn't feel quite right it felt tight. On feeling this I said to my escort Willy I [wanted] to check the slew valve. I jumped out of the cabin to check the valves, opening the flap and found the valves were in the dolly position as they should be. I then thought I didn't activate the dolly switch which I indicated before. I got back in and activate[d] it. With that I said to Willy it should be fine and we proceeded to the job. There was no tightness in the steering as we went to the job. Q41: When you turned on the switch did it blink and go out or stay on? A: It flash and then it went out." 14In his examination in chief, the plaintiff said he had made a similar mistake on prior occasions although it "wouldn't be many at all" (Tcpt, 23/05/11, p 38(37)) and described what happened as involving "an instant tightness in the steering, ceases all functions, check what I have done wrong and correct it and that has been no problem": Tcpt, 38(45). In cross-examination he was asked if the flashing dolly switch indicated that the hydraulics were operating and said, "It flashes, I would say that is to assist the slew, how I don't know": Tcpt, 41(18). He was then pressed as to what he did and did not know, agreeing that he worked for Wilson's Cranes as a crane driver for about four years before he went to Brambles and that he held relevant licences or certificates: Tcpt, p 41. He agreed that there were in the crane two volumes, one a maintenance volume and the other an operating manual. He said he had not read the operating manual right through, but had referred to it "to correct some bad advice I was given": Tcpt, 42(47). He agreed he had driven the 1225 for "year and a half or something like that" and had used the dolly "many, many times": Tcpt, p 43(15). 15In cross-examination by counsel for Baden, he agreed that he had first started operating cranes "30 years ago": Tcpt, 52(41). He also agreed that he knew "the dolly switch activated a pump" saying, "Yes, that's what it would be for": Tcpt, p 55(28). He was a little coy as to its precise operation (Tcpt, p 55(41)) but agreed that he knew that its purpose was to allow the boom to slew left or right as the vehicle turned (Tcpt, pp 56-57). 16He was cross-examined at some length as to whether he understood that to be a safety practice, but he did not view it as such. In answer to a question from the WorkCover inspector as to the cause of the accident, he stated: "I'm not an engineer but the way the dolly is attached to the crane without a drawbar seems to puts [sic] undue stress on the slew-ring and allows it to almost jack knife at times. On a sharp corner it sometimes lifts the wheels on the carrier. Over time this may have contributed to the cause of the incident." 17The combination of these answers provided an ample basis for the finding that the plaintiff was not aware of the potential consequences of driving the crane with the boom on the dolly without releasing the slew lock. The trial judge found that he should have been warned of the possibility of the steel locking pins shearing if the crane were driven without releasing the slew lock. Although the proposed warning was not identified with any precision, it may be inferred that the warning was intended to advise the plaintiff and operator of the crane of the risk of damage to the steel rods holding the bayonet connector in place.

(a) nature of risk 18The risk which materialised in the present case was a function of two features of the crane. The first was inherent in the original design, namely that for the purposes of transport, the upper platform could be released from the base of the crane. The bayonet connector was held in place by steel rods. No doubt those rods had to be of sufficient strength to hold the slew rings in place under normal operating conditions. There is no suggestion but that they were of sufficient strength for that purpose. The second feature of the crane arose from its adaptation for transport in one piece with the boom supported by a dolly. That required release of the mechanism which otherwise held the two parts of the slew ring locked in place. Clearly if the mechanism were not released prior to movement of the crane, there would be significant torque applied to the rods which locked the slew rings together. 19As will be seen, in considering the case against each defendant, and indeed the contributory negligence of the plaintiff, that much was understood by all parties. What was not known or, it appears, even considered, was the torque which might apply to the connecting rods in the event of the crane being driven at even a 1.5 degree deflection from a straight line, without the slew ring breaking mechanism being released. 20Mr Gillespie gave evidence he had driven mobile cranes with dollies without releasing the braking mechanism. In each case he had stopped and released the mechanism before proceeding. Such events, though no doubt undesirable in terms of the strain imposed on the machinery, did not carry the same risk as with the Liebherr 1225 because the cranes were not constructed with separable upper and lower parts. A full appreciation of the risk involved required knowledge of the structure of the crane, including the strength of the locking pins and a calculation of the possible torque. 21The professional engineers who prepared reports for the proceedings were largely in agreement. Thus, Mr Frost concluded that the two pins which sheared off in the accident were more than adequate to sustain the anticipated loads of the crane in operation. In respect of the cause of the accident he concluded (paragraph 34): "If the slewing motor is not in the open-circuit condition hydraulically and the slewing brake is not also released, articulation of the crane assembly at the slewing ring will not be possible. Under such circumstances, the two pins will be subjected to a force which is required to equilibrate the slewing moment generated by the total lateral force required to skid the dolly truck sideways, acting at a distance equal to the distance between the centre of the dolly truck and the centre of the slewing ring. From the information provided ..., and assuming a coefficient friction of 1 between the tyres and the road, this moment calculates to be 3 times 8.4 tons times 7.8 metres, ie 196 tons metres. This level of torque would certainly be capable of shearing off the two pins." 22What was unclear from the evidence was the extent of the torque which might be applied where the driver started forward without releasing the slew lock, but quickly realised his error from the "tightness" in the steering and corrected the problem. From the evidence of Mr Smith to the effect that he had driven the crane in the past after inadvertently failing to release the slew lock, it appeared probable that the error could be corrected without seriously weakening the pins. However, that possibility of harmless error did not form part of the assessment in the present case. 23The other variable factor which was not pursued was the possibility of damage to other components of the crane. Thus it appears that the slew gearbox housing had also cracked. The combination of separate forms of damage suggests that a sharper turn may have been attempted on the present occasion than had occurred on past occasions on which there had been failures to release the slew lock mechanism.

(b) foreseeability of harm 24The relevant harm which eventuated in the present case may be identified as the shearing of the pins holding the bayonet connector. There was, of course, the subsequent harm involving the toppling of the crane during operation, which in turn led to the plaintiff being thrown to the ground and suffering injury. For the purposes of assessing negligence under s 5B of the Civil Liability Act, it is appropriate to focus upon the initial risk, namely the shearing of the pins, caused by the mistaken driving of the vehicle without releasing the slew lock. 25The first question was whether that risk was foreseeable: s 5B(1)(a). Although it is not in issue in the present case, it is likely that the risk was foreseeable to the manufacturer, Liebherr, which knew of the modifications, the weight and dimensions of the crane and the strength of the steel pins. A critical issue at trial and on appeal was whether each of the defendants knew or ought to have known of that specific risk. 26Because the pins appear to have been the weakest point in the structure of the crane, there was a "not insignificant risk" that they might be damaged, weakened or broken by failure to release the slew lock: s 5B(1)(b). In another sense, the risk of the pins shearing if significant torque, above that encountered in the normal operation of the crane, were applied to them was also "not insignificant".

(c) precautions 27The next step in the statutory scheme is to inquire what precautions a reasonable person in the position of each defendant would have taken against the risk: s 5B(1)(c). That requires consideration of the probability that the harm would occur if care were not taken, the likely seriousness of the harm, the burden of taking precautions and the social utility of the activity that creates the risk of harm: s 5B(2). That assessment requires identification first of the proposed precautions relied on by the plaintiff as an element of the negligence. 28The possible precautions arose at two stages. The first involved a warning device in the driver's cabin alerting the driver to any failure to release the slew lock prior to moving the crane, when attached to the dolly. The second stage at which precautions could be taken was after the driver had commenced to move the crane, thereby risking damage to the pins. One possible approach would have been to strengthen the connection by increasing the number of pins from two to eight, thereby reducing the risk of shearing. An alternative approach would have been to provide a warning to the operator of the crane in the event of damage. For example, a movement of more than 10 mm in the slew rings could be revealed to an observer by painting a white line across the two halves of the slew rings, so that any displacement would be visible, or by an electrical mechanism which cut power thus stopping the operation of the crane, in the event that such a movement occurred. Following the accident, Liebherr and Gillespie agreed that the last three precautions should all be taken and the crane was modified accordingly. There was no dispute that these precautions were such as a reasonable person might have taken against the risk of harm, if that person knew or ought to have known of the risk. 29In the course of the trial, attention was paid to the concept of a "warning" to the operator as to the risks of catastrophic failure of the crane in the event that it was driven without releasing the slew lock. Although it will be necessary to deal with that possibility, the manner in which the trial judge dealt with this issue showed that the suggestion was fraught with difficulty and there was no clear evidence as to what kind of warning would have been appropriate and sufficient to avert the risk which materialised. There was a complaint that the operating manual for the crane failed to reflect the changed procedures following the modification to allow the use of the dolly. However, that complaint was largely beside the point. Mr Smith, who appears to have been the only, or at least the primary, operator of the crane since the modifications were undertaken, was fully aware of the procedure to be followed. On his own evidence, it was improbable that he would have read the section of the manual if it had been amended to describe the procedure. 30The critical information which needed to be conveyed, but was not, was not as to the operation of the crane with a dolly, but as to the risks of catastrophic failure if the slew lock were not released prior to commencing to move the crane. In the absence of any finding as to precisely what warning should have been given, and in what form, it was not possible to make a finding as to the likely consequence of a warning. The trial judge described the crane as a complex and sophisticated piece of machinery and there were no doubt serious risks consequent upon failures at numerous points to comply with the operating instructions. 31Finally, a warning that serious consequences might follow, without any mechanism for determining whether, in a particular case, they had, might result in such warnings being ignored, particularly if mistakes had been made in the past without the risk materialising. 32Whatever the relevant precaution, negligence would not be established until it had been shown, in respect of each defendant, that it knew or ought to have known of the relevant risk. The circumstances of the defendants differed, with the result that each must be considered sequentially.

(d) negligence - Baden 33The trial judge dealt with this question under the heading "Case against Baden", in a lengthy passage at [112]-[162]. After stating the relevant legal principles the following conclusion, to be explained later, was expressed at [115]: "In summary, in my assessment, Mr Smith, as a crane operator, has established that Baden owed him a duty to exercise reasonable care to warn of the risk of collapse which its modifications of the crane had created, so that he would not be exposed to an unreasonable risk of injury." 34Significantly, in the light of later statements, the burden of proof was correctly placed on the plaintiff. In what may also be treated as part of the summary of her conclusions, the trial judge continued at [116]: "Given the risk of catastrophic damage to the crane which Baden had created by its modification ... there can, in my view, be no question about the duty of care which arose and the foreseeability of the risk in question, in the s 5B(1)(a) sense." 35The following passages addressed a number of issues, including the submission made by Baden that in modifying the crane to allow use of a dolly, it had followed specifications provided by Liebherr. Although this proposition was entirely plausible, the trial judge found that it had not been established on the evidence. However, even if it had been, it is by no means clear that it was relevant to the issue of knowledge of risk. Other statements in the reasons assumed, rather than demonstrated, knowledge of the risk: eg, at [129]. Those passages which did address the question of knowledge appeared to reverse the onus of proof. Thus the trial judge reasoned: "133 While Baden did lead expert evidence, as did Brambles, no expert expressed the view that on the information available to Baden, given the nature of the work it had undertaken, that Baden could not have been aware of the risk which resulted from the modification it had made. ... 134 Baden produced the modification Brambles desired, which permitted the crane to be transported by road, without disassembly. In doing so Baden had a duty to warn of any risks its modifications introduced, particularly of the inordinate risk of the crane collapsing, which had been created by those modifications. That it did not have sufficient information from Liebherr to understand the nature of the risk it had created, was, in my view not established. ... [G]iven the work it undertook, Baden had reason to know of the risk and to warn of its creation. 135 ... The operational change which those modifications made to this machine was very significant. Baden accepted that new dangers which had not previously existed were thereby created. I am unable to accept that those dangers were not apparent to Baden, from the nature of the work it had undertaken on the crane." 36At this point in the reasoning, under the heading "Duty of care", there appears to have been an assumption that Baden understood the strength of the locking pins and the forces which would be applied to them in the event that the slew lock was not released prior to travel. When addressing breach, the reasons referred to a submission that "no evidence had been called as to what a reasonable repairer in its position would have known about the risk of the dowel rods shearing" and acceptance that the plaintiff bore the onus of proof on that issue: at [149]. In what appears to be a continuation of the submission, the trial judge said at [150]: "It was not accepted that as a matter of logic, given the nature of the crane and what the modifications achieved, that it was obvious that the rods would shear, from the force applied to them, if the brake was not released before the crane was driven. The question had to be determined on the basis of what was known before the accident occurred, not with the benefit of hindsight. There was no suggestion that the rods, while thin, were not fit for their intended purpose." 37That submission was not adequately addressed. The finding at [151] was to the following effect: "On the evidence, given the modification work it had undertaken, it seems to me, that a reasonable person in the position of Baden ought to have warned that if the brake was not released, the rods would shear if the crane was driven." Again, the evidential basis for the conclusion, beyond knowledge of the nature of the modifications, is missing. The reasoning also failed to address the evidence of the plaintiff, which appeared to be accepted, that he had commenced to drive without releasing the slew lock on prior occasions, without catastrophic results. 38The conclusion as to breach was then stated in the following terms at [155]: "Inadvertent failure to activate the switch could not be excluded, in the absence of any mechanical warning of the need to do so. In that event, absent any information or warning of the need to check that the crane had not been damaged, so that a catastrophic collapse would result, if it was operated, without activating the switch, the risk of serious injury to which operators such as Mr Smith were exposed, was foreseeable and indeed obvious. By failing to provide such information and warning, Baden breached its duty to Mr Smith and the owners of the crane." 39The particulars of negligence pleaded against Baden, although somewhat confused in expression, involved two elements. The first was a failure "to modify the crane for transportation to incorporate necessary safety features": second amended statement of claim, par 14(b). These appeared to be further particularised in par (f) as follows: "(i) increase the lock pins on the slew ring to ensure the slew ring could not come apart by a force produced by the dolly; (ii) failed to provide a system allowing for a visual inspection of the slew ring; (iii) failing to provide any warning system to alert the operator to the fact that all the steps required to prepare the crane for being driving on the dolly had not been undertaken; (iv) failed to provide a safety device which would provide a warning if the hydraulic pump switch were not activated; and (v) failed to provide a kill switch to ensure the vehicle could not be driven if the appropriate steps to prepare the crane to be driven on the dolly had not been undertaken." 40It was also pleaded that Baden failed to provide adequate information and warnings as to the risk if the slew lock were not released: par 14(a), (c), (d) and (e). 41These two elements of the pleading were not separately addressed in the reasons given by the trial judge. Further, the final conclusion at [155] as to the need for "information and warning" was not sustainable in the absence of some greater clarity as to the how the information should have been provided or the warning given. On the other hand, the need for information or warning appears to have been accepted as consequent upon the absence of any "mechanical warning" of the kind identified in the particulars. 42To determine the appeal it is necessary to make findings as to the content of the proposed duty of care owed by Baden to the plaintiff. The plaintiff's case was based on the proposition that in order to allow the crane to be transported without disassembly and by means of a dolly supporting the superstructure, a number of modifications were required. The first involved the design and construction of an appropriate dolly, together with the means by which the boom of the crane would be affixed to it whilst in transit and released when the crane arrived on site. Secondly, it was necessary to ensure that the boom could move freely as the vehicle travelled, both in horizontal and vertical planes. Baden made all the necessary modifications to allow this method of transport to occur. At least as a matter of inference, it could be found that Baden knew enough about the structure and operation of the crane to understand that if the relevant braking mechanism were not released, significant torque would be applied at various points, including, with respect to movement in the horizontal plane, the slew ring. It may also be inferred that Baden knew how the two parts of the crane were held in place during operation and knew of the locking pins which prevented disassembly. On the basis of the engineering reports, it may also properly be inferred on the probabilities that Baden knew or ought to have known that significant stress would be applied to the locking pins if the slew ring braking mechanism were not released prior to travel. The possibility that such an event could occur was foreseeable to a company which understood the operation of such a crane. 43Greater difficulty arises as to the next stage of the plaintiff's case, namely that Baden knew or ought to have known of the possibility of the locking pins shearing if a driver sought to move the vehicle more than a small deviation from a straight line without activating the mechanism to release the slew lock. The absence of direct evidence is not, however, fatal to the plaintiff's case. Once it is accepted that Baden knew exactly how the mechanism worked, what was required of the crane driver, and that the operator might on occasion fail to release the slew lock, it is reasonable to find that Baden ought to have made inquiries of Liebherr as to the possible consequences of a failure to release the slew lock. If informed of a significant likelihood of damage, or that damage was not readily assessable, Baden's duty would have extended to considering a failsafe mechanism such as a warning light or a locking device which prevented the crane being moved once the boom was attached to the dolly without the slew lock being released, or a mechanism to allow the crane operator to determine whether the crane had been damaged if it were able to be moved without releasing the slew lock. 44In these circumstances, the conclusion as to the negligence of Baden should be upheld, but on the basis of a failure to provide a mechanical system which would either have precluded the crane being driven without the slew lock being released, or would have provided a means for identifying any damage which resulted from inadvertent failure to release the slew lock. Either of these alternatives would satisfy the criteria in s 5B(1). 45This conclusion obviates the need to address the complaints raised by Baden as to the finding with respect to causation. That finding was expressed in the following terms at [159]: "The evidence I have referred to does not leave room for doubt that factual causation was established against Baden. It made the modifications which resulted in the risk that the crane would collapse, if driven without the switch first being activated. It did not warn of the risk, or provide information either as to how safe operation of the crane depended on operator memory, that is remembering to activate the switch, before driving the crane; or that failure to do so could result in catastrophic damage to the crane. That risk materialised on the day of the accident." 46Adequately to address causation in respect of a warning or supply of information, required identification of the content of the warning, together with the manner and timing of its provision. Those issues do not arise once it is accepted that Baden's negligence depended upon one or more of the mechanical modifications identified above. The adoption of one of the alternative modifications would have prevented the accident. Failure to take such precautions would satisfy s 5D(1)(a), subject to the impact of negligent conduct of other parties addressed at [66]-[73] below. 47The remaining issue in respect of Baden's appeal concerns the proper apportionment of responsibility between the defendants and between them and the plaintiff. That will be addressed after considering the situation of the other defendants.

(e) negligence - Brambles 48The reasoning of the trial judge with respect to the liability of Brambles, as with Baden, addressed separately duty of care, breach and causation at [166]-[223]. The trial judge had regard to the following factors: (a) that Brambles had sought the modifications which gave rise to the risk of collapse on operation; (b) Brambles operated the crane after the modifications had been undertaken; (c) the plaintiff was employed by Brambles to operate the crane as modified; (d) Brambles gave the plaintiff no warning or information as to the risks attached to operating the crane as modified; (e) Brambles sold the crane to Gillespies, without having provided any warning or information as to the risks, and (f) the crane collapsed whilst being operated by its former employee, the plaintiff. 49As to what Brambles knew or ought to have known about the risks of harm, the analysis is similar to that referred to above with respect to Baden. Brambles knew that the crane was designed to be transported disassembled and that the modification which it had sought was to allow the crane to be transported in one piece, with use of a dolly. It may be inferred that, having purchased and operated the crane pre-modification, Brambles was aware of the fact that the crane separated at the slew ring, that there was a bayonet connector and that the connector was held in place by locking pins. Like Baden, it may well be that Brambles had no actual knowledge of the strength of the locking pins. It may also be accepted that Brambles was not shown to have knowledge of the particular forces and stresses which would be applied to the locking pins in the event that an operator drove the crane without releasing the slew lock, so as to allow the boom to rotate in the horizontal plane. 50However, as in the case of Baden, it should be inferred from the nature of Brambles business that it had sufficient understanding of the way in which the crane would be driven to realise that an inadvertent failure to release the slew lock would put significant stress on the structure of the crane. It should also be inferred that the possibility of such inadvertent failure was foreseeable to Brambles. The same conclusion may be reached in respect of a finding of negligence, namely that Brambles ought to have taken further steps to inquire as to the risks associated with the crane as modified. Had it obtained the relevant information from Baden or Liebherr, its duty of care to operators and others required it to take the further steps identified above as those required of Baden. 51On the other hand, the position of Brambles differed from that of Baden in a number of respects. First, it did not design, construct or install the modifications. Secondly, whatever knowledge and expertise it may have had as a crane operator, there was no suggestion that either extended to the design or construction of a crane. 52The trial judge treated Brambles' liability as depending upon one of two additional considerations. The first was that it owed a duty as a "non-manufacturing distributor of goods": at [184]. In the alternative, it remained liable to the plaintiff for its breach of duty in failing adequately to warn or train him whilst in its employ: at [190]-[194]. The extent to which the trial judge relied on the latter foundation was not entirely clear, but it was in any event abandoned as a basis of liability in the course of the appeal. 53In respect of its duty as a non-manufacturing distributor, the trial judge reasoned as follows: "195 Brambles not only sold its crane operation as a going concern to Gillespies, it also sold the crane, on the understanding that Mr Smith would take up employment with Gillespies, in order to continue operating the crane. The mere fact of the sale of the crane was not a sufficient basis on which to conclude that a duty of care arose, either to the purchaser or operators of the crane (see Laundess v Laundess (1994) Aust Torts Reports 81-316; McPherson v Eaton and J & V Pesl v Ray Smith Tractors [2007] NSWCA 74). Something more had to be established. As Wood CJ at CL discussed in Lanza v Codemo [2001] NSWSC 845 at [171]: '... the existence of the duty depends upon the nature of the goods sold, the risk involved and the extent to which that risk was known to, or should have reasonably been known, to the supplier ... .' 196 In this case the conclusion that a duty arose on the sale of the crane lies in the evidence of what Brambles sold to Gillespies and what it then knew and reasonably ought to have known about the modifications it had Baden make to the crane and what its safe operation thereafter required." 54The trial judge also placed significant emphasis on the failure of Brambles to have the operator's manual updated so as to reflect the modifications to the crane: at [181]-[182]. However, that finding again lacked precision as to the content, timing and placement of any warning or information. The plaintiff was not trained in the operation of the crane as modified by requiring that he read the operating manual and there was no basis for thinking he would have been so trained had the manual been updated. The causal link between the failure to update the manual and the accident was not established. 55To treat Brambles as a "non-manufacturing distributor" is to risk misstating the issue by reliance on a label derived from other cases. The circumstances of Brambles bore little relationship, for example, to the circumstances in McPherson's Ltd v Eaton [2005] NSWCA 435; 65 NSWLR 187. McPherson's was a large hardware retailer which, amongst "a myriad of products" sold millboard containing asbestos: [39]-[42]. It was held not to owe a duty of care to purchasers of the millboard, one of which employed a worker who later died of mesothelioma as a result of inhaling asbestos dust caused by cutting the millboard for his employer. 56In McPherson's Ltd Ipp JA undertook a detailed consideration of the case law with respect to the liability of a retailer: at [59]-[84]. The closest examples to the present case involved sales of second-hand cars, which the vendors had driven or used prior to sale. In two reported English cases, liability was upheld by single judges: Herschtal v Stewart and Ardern Ltd [1940] 1 KB 155; Andrews v Hopkinson [1957] 1 QB 229. These cases were discussed by Mahoney JA (Meagher and Powell JJA agreeing) in Laundess v Laundess (1994) 20 MVR 156; (1994) Aust Torts Rep ¶81-316. In Herschtal, the vendor had agreed to sell "a reconditioned Morris car", which had a rear wheel poorly secured by pins from which the threads had been stripped and the nuts had not been properly tightened. The claim against the defendants was in negligently reconditioning the car. 57In Andrews, as explained in Laundess, liability was upheld on the basis of a defect in the steering mechanism which could, on inspection, have been identified by the defendant, but was not. Mahoney JA suggested that liability in negligence should only have been upheld if the vendor had been under a duty to inspect the vehicle and in particular the steering. Absent knowledge of the defect and absent such a duty, it is apparent that the result would not be upheld in this Court. 58In the present case, it is clear that Brambles was more than a distributor; it had organised for the crane to be modified in a manner which gave rise to a risk which it, as a commercial operator of mobile cranes, should have understood. However, even that element would not necessarily be sufficient to give rise to liability. The instigator of a modification to a well manufactured piece of equipment will not necessarily owe a duty of care to subsequent owners in respect of a fault in the process of modification of which the vendor did not know and was under no duty to discover. There are other considerations at play in the present case, as noted at [50] above. 59Further, it is necessary to consider to whom any possible duty may be owed. As explained by Mason P in McPherson's Ltd, "there may be a need in some cases to distinguish between different categories of purchasers": at [25]. The President gave as an example the sale of a flammable substance to a child, as compared with a sale to an adult. Similarly, it may be necessary to distinguish between the immediate purchaser with whom there is a contractual relationship and a person with whom the distributor had no contractual relationship: see Imperial Furniture Pty Ltd v Automatic Fire Sprinklers Pty Ltd [1967] 1 NSWR 29 at 39 (Jacobs J) quoted by Ipp JA in McPhersons' Ltd at [69]. In the present case, Brambles sold the whole of its crane hire business, including the Liebherr LTM 1225 crane, to Gillespies, pursuant to a contract under which Gillespies was responsible for satisfying itself as to the nature and quality of the goods. For reasons which will be identified shortly, Gillespies was in as good a position as Brambles to identify the risks attendant on the modification to the crane. If Brambles and Gillespies had agreed as to the allocation of responsibility with respect to the equipment, it would not be appropriate for the law to impose an inconsistent duty arising outside the contract. 60However, the factors noted above at [50] lead to the conclusion that Brambles owed a duty of care to a class of people which would include those who operated the crane or worked in the vicinity of the crane or were responsible for the health and safety of such persons, for any damage flowing from a failure of the crane due to the lack of a relevant safety device, after it had sold the crane.

(f) negligence - Gillespies 61The trial judge accepted that Gillespies' knowledge as to the modification of the crane and its capacity to be disassembled, was similar to that of Brambles. It was not dependent on the operator's manual for this information: when it purchased Brambles' crane hire business, it also employed Mr Pritchard, who had been employed by Brambles as a mechanic and knew the workings of the crane and its ability to be uncoupled: at [238]. As the trial judge further noted at [240]: "What the operator's manual did deal with was the removal of the upper platform. It also contained instructions as to the regular maintenance of the crane, which required its removal. That referred to the retaining pins. Mr Gillespie agreed that if he had read the operator's manual, he would have become aware of the existence of the split ring system and that the upper platform could be removed. Gillespies' later maintenance of the machine would also have revealed these aspects of the crane's functions, even if it had not already been known to Mr Pritchard, as it was." 62The trial judge accepted that Gillespies' duty extended to taking reasonable care to devise a method of operation which involved adequate safeguards against the risk which materialised. With respect to the duty owed to the plaintiff, as employer, it was not able to rely upon whatever instruction or warnings Brambles had given to him before he came into Gillespies' employ. Accordingly, Gillespies was held to be in breach of duty, a breach which was causally related to the injury suffered. There is no appeal from these findings: indeed, the only challenge raised by Gillespies to the judgment below was a complaint that Brambles should have provided a modified operating manual in compliance with their obligations under the sale agreement. That contention was raised in support of the apportionment of responsibility, as between it and Brambles.

(g) contributory negligence - plaintiff 63Finally, in terms of the responsibility of each of the parties for the accident, both appellants challenged the finding that the plaintiff was not contributorily negligent. That finding was based primarily, if not entirely, on the failure to warn the plaintiff of the consequences of moving the crane without the slew lock being released. 64For reasons already given, it is by no means clear that such a warning would have been effective. The trial judge did not discuss whether a relevant warning would have been expected to overcome any momentary inadvertence, or whether some step could be taken to allow the operator to determine whether damage had been done if the switch were not activated, but the vehicle was moved a short distance. There being no visible indication of damage, the direction would presumably have been to return the crane to the yard so that mechanics could remove the locking pins and check that they were undamaged. Given the potential consequences for the company's business, it seems likely that, had the risk been adequately identified, some other mechanism would have been adopted. In any event, the contributory negligence of the plaintiff does not appear to have been pleaded or presented on the basis that such action was a necessary part of his own duty of care. To the extent that such claims were pleaded, they were not established on the evidence. Accordingly, the trial judge was correct to dismiss the defences of contributory negligence.

(h) causation 65The issue of causation was to be determined by application of s 5D of the Civil Liability Act. That section, relevantly for present purposes, states: 5D General principles (1) A determination that negligence caused particular harm comprises the following elements: (a) that the negligence was a necessary condition of the occurrence of the harm (factual causation), and (b) that it is appropriate for the scope of the negligent person's liability to extend to the harm so caused (scope of liability). 66The application of s 5D to a case involving three consecutive and related sets of negligent conduct by three different actors is not straightforward. The section must be applied separately to each. In some cases breach of duty and harm occur, broadly speaking, contemporaneously. In other cases, there may be an interval of time in which other events occur. In the present case, Baden's breach would not have caused the plaintiff's injury absent intervening tortious failures by Brambles and Gillespies. Nevertheless, if one takes all other events (including the inadvertent action of the operator) as given, Baden's negligence was undoubtedly a necessary element in a set of conditions which, together, were sufficient to cause the harm. This reasoning accords with the statement of principle by the High Court in Strong v Woolworths Ltd [2012] HCA 5; 86 ALJR 267 at [20]. The same analysis operates in relation to Brambles and Gillespies. 67True it is that absent Baden's negligence, the conditions necessary for the harm to occur would not have arisen: but equally, in each case, the failure to rectify the defect was an event without which the harm would not have occurred. Thus s 5D(1)(a) was established in relation to each defendant. 68The next step is to consider the policy question, namely whether "it is appropriate for the scope of the negligent person's liability to extend to the harm so caused". This was a case where, through the combined negligence of Baden and Brambles, a machine was created with an inherent risk of failure in the case of minor inadvertence by the operator. Such inadvertence was reasonably foreseeable, as was the harm which eventuated. A negligent manufacturer of such goods would not escape liability because the goods had left its control. There may, however, be a point at which its liability should cease if, for example, a purchaser who knew or had reason to know of the defect had had a reasonable opportunity to correct it. 69It was once thought that the liability of a manufacturer might cease in a case where there was a "reasonable possibility of intermediate examination" before the product was used: Donoghue v Stevenson [1932] AC 562 at 599 (Lord Atkin). However, as explained by Windeyer J in Voli v Inglewood Shire Council [1963] HCA 15; 110 CLR 74 at 86, the appropriate question was not the "possibility" of examination, but whether examination or testing was contemplated in the ordinary course of events, prior to consumption or use. Even in a case where there is an intermediate failure to examine or test "the mere fact that a subsequent act of negligence has been the immediate cause of disaster does not exonerate the original offender": Grant v Sun Shipping Co Ltd [1948] AC 549 at 563. These authorities have been applied to find liability on the part of a manufacturer where the owner failed to remedy a patent defect: Australian Shipbuilding Industries (WA) Pty Ltd v Packer (1993) 9 WAR 375 at 380 and 383 (Ipp J; Anderson and Owen JJ agreeing). 70This case differs from a case such as Erwin v Iveco Trucks Australia Ltd [2010] NSWCA 113; 267 ALR 752, where there was a potential weakness in the steering linkage of a commercial vehicle, which might develop over time, but one which the manufacturer could reasonably expect would be noted by appropriate maintenance. Sackville AJA noted at [111]: "Manufacturers are not necessarily entitled to assume that purchasers or users of their products will invariably follow instructions or act in a prudent and sensible manner. But for this failure of the steering system to occur, there had to be two independent and serious departures from the standards of conduct reasonably to be expected by the manufacturer of the Truck." 71A different category of cases, involving sequential injuries, establish analogous principles relevant to cases like the present in which there are sequential acts of negligence, but only one injury. Chapman v Hearse [1961] HCA 46; 106 CLR 112 falls into the latter category. The first accident, caused by the negligence of Mr Chapman, did not injure Dr Cherry. He was a "rescuer" killed by the negligence of the second driver. The High Court upheld the finding that the first driver was liable to Dr Cherry's executor, because the accident which caused his death was a reasonably foreseeable consequence of the first accident. It was wrong, in all the circumstances, to identify the driver of the second vehicle as the sole cause of the damage: at 122. 72This was not a case of negligence followed by the tortious intervention of a third party, which might break the causal link: cf Lothian v Rickards [1911] HCA 16; 12 CLR 165. Nor was this a case involving consecutive injuries caused by consecutive but independent acts of negligence: cf Dillingham Constructions Pty Ltd v Steel Mains Pty Ltd [1975] HCA 23; 132 CLR 323; Mahony v J Kruschich (Demolitions) Pty Ltd [1985] HCA 37; 156 CLR 522; Commonwealth of Australia v Martin (1985) 5 FCR 351; Paul v Cooke [2012] NSWSC 840 at [36]-[38] (Brereton J). Where the subsequent negligence is a reasonably foreseeable result of the earlier negligence, it will not break the causal chain: thus, negligent medical treatment following a work injury may be foreseeable, but not gross incompetence: Kruschich at 530 and Erwin at [111]. It is in this sense that each subsequent actor in the chain should not, in principle, escape liability for the sole reason that others before or after it were negligent. Subsequent negligent acts of the same kind, as in this case, will readily be foreseeable consequences of the first negligent act. 73In the present case the flaw in the design of the modification was not a weakness which might develop over time; it was present from the beginning. Because Baden had no reason to believe that the risk which it created would be obviated by the conduct of the owner of the crane, there was no reason why its negligence should not be treated as a cause of the harm. 74With respect to Brambles, the scope of the appropriate liability is less clear. On the one hand, its failure to ensure that the crane as modified incorporated protection against inadvertent mistakes in releasing the slew lock and, if the lack of a warning were the element of negligence, its failure to train or warn future operators, remained a significant cause of the accident. Nevertheless, when the accident occurred, it had no control over the crane, its use, the training of operators or the manner of its operation. However, its role in creating the risk indicates that it, like Baden, should continue to bear some responsibility for the accident. 75Gillespies did not challenge the finding of liability and, accordingly, no question of causation arose in respect of its role. Its role was, however, relevant to the question of apportionment on the cross-claims, to which it is now necessary to turn.

Apportionment as between defendants 76The question of apportionment is to be determined in accordance with s 5 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW), which, so far as relevant, provides: 5 Proceedings against and contribution between joint and several tort-feasors (1) Where damage is suffered by any person as a result of a tort (whether a crime or not): ... (c) any tort-feasor liable in respect of that damage may recover contribution from any other tort-feasor who is, or would if sued have been, liable in respect of the same damage, whether as a joint tort-feasor or otherwise, so, however, that no person shall be entitled to recover contribution under this section from any person entitled to be indemnified by that person in respect of the liability in respect of which the contribution is sought. (2) In any proceedings for contribution under this section the amount of the contribution recoverable from any person shall be such as may be found by the court to be just and equitable having regard to the extent of that person's responsibility for the damage; and the court shall have power to exempt any person from liability to make contribution, or to direct that the contribution to be recovered from any person shall amount to a complete indemnity. 77As between several tortfeasors, the degree of responsibility of each will depend upon the relationship (in a broad sense) between the tortfeasors and the plaintiff, but also, as reflected in the reference in s 5(1) to possible indemnification, upon the relationship of the tortfeasors as between each other. 78It is convenient to address apportionment by first considering the respective positions of Baden and Gillespies and putting to one side the role of Brambles. Baden, as manufacturer, knew of the potential weak points in the modified crane and knew, or was reasonably able to discover, the respective strengths of the parts of the crane which were likely to be placed under stress in the event of transportation without first adjusting the relevant levers and pressing the switch in the driver's cabin. However, while the crane was a reasonably sophisticated device, it was not technically complex. For the reasons discussed above, a commercial crane operator should have understood the basic design. Further, the commercial operator may well have known, or had the opportunity to discover, the risks of inadvertence in the course of transporting the crane which may not have been fully appreciated by the manufacturer. The latter consideration indicates that the respective liabilities of manufacturer and operator may have changed over time. In evaluating what is "just and equitable" as between Baden and Gillespies, given the experience of the crane in operation and the knowledge available to Gillespies from the operator and mechanic who had experience of the crane when owned by Brambles, the appropriate apportionment is 50:50. 79Taking into account the responsibility of Brambles, but ignoring initially the contractual relationship between Brambles and Gillespies, three factors may be identified. First, Brambles was the party which proposed and instructed Baden to undertake the modifications; secondly, Brambles operated the crane for some months after the modifications were made and with full knowledge of the nature of the modifications, but, thirdly, it no longer had control of the crane or the operators at the time of the accident. The first consideration is a factor which Brambles shared with Baden; the second factor applied also to Gillespies. The third factor tended to diminish the significance of each. Thus, leaving the contractual arrangement aside, it is appropriate that Brambles bear 20% of the responsibility for the harm, which may be apportioned to reduce by 10% the total responsibility of Baden and Gillespies respectively. The result would be an apportionment as between Baden, Brambles and Gillespies in the ratio 40:20:40. 80There remains the question of the contractual relationship between Brambles and Gillespies. Both parties sought to rely upon the terms of the business sale agreement. Gillespies asserted that Brambles was in breach of the agreement by failing to supply it with relevant documentation in relation to the crane, as required by the agreement. Brambles asserted that pursuant to the express terms of the agreement, relevant liabilities and risks passed to Gillespies. 81Gillespies' submissions in support of its contention can be dealt with briefly. Gillespies complained that Brambles warranted and represented to it that, at the date of the agreement, "the written records and written information relating to the Business which [Brambles] has made available to [Gillespies] before the date of execution of this agreement are true, complete and up to date copies of the documents which they purport to be": Sale of Business Agreement, cl 17.1A. Although Gillespies acknowledged that it had completed "all due diligence enquiries and investigations it considers necessary or appropriate with respect to its purchase of the Business Assets" (cl 17.4(a)(1)), and indemnified, released and discharged Brambles "absolutely with respect to any losses sustained by or Claims made against [Brambles] arising as a result of any due diligence carried out by [Gillespies] being incomplete or inadequate", it did so only on the basis that Brambles' warranty in cl 17.1A was "correct". 82As noted above, much of the disputation at trial concerned the failure of Baden (and Brambles) to update the operator's manual after the modifications were made. Whilst it was not established that such a step would have come to the notice of the plaintiff, as operator, there is a separate question as to whether that course would have alerted Gillespies to the risks associated with inadvertent failure to release the slew lock before driving the vehicle. Given that the same personnel were responsible for the operation of the crane whilst with Gillespies, that consequence is improbable. Further, the vendor's warranty in cl 17.1A did not cover the kind of omission upon which Gillespies sought to rely. The operating manual for the crane was "true, complete and up to date" in the sense that no existing paperwork had been omitted. It may be said to be inaccurate or incomplete to the extent that it did not deal with the modification, but that had no material consequence. The way in which Gillespies had to assert that it was inaccurate or incomplete depended on a finding as to a variation which should have been made, but was not. Such an omission did not constitute a misrepresentation of a kind which would warrant adjustment of the parties' shares of responsibility for the accident. 83Brambles' submissions did rely upon the indemnity, release and discharge in cl 17.4, but did not fully explain why its liability to the plaintiff in respect of an injury which occurred after the date of the agreement involved a loss sustained by it, or how a claim made against it arose from incomplete or inadequate due diligence carried out by Gillespies. Rather, the liability arose from its own prior negligence. Further, the reliance placed upon the passing of the risk in the business assets and the obligation to insure those assets, did not affect the present question. Accordingly, it is not apparent that Gillespies took responsibility for any liability Brambles might have in respect of the use and operation of the plant after the date of the agreement: cl 10.1. Although not relevant to the apportionment question, Brambles was then required to indemnify Gillespies if it failed to comply with its obligations under cl 10.1: cl 10.2. 84These provisions did not require Gillespies to indemnify Brambles with respect to any liability in tort resulting from Brambles' negligence before the date of the agreement, where the harm was incurred after that date. There is, therefore, no reason based on the sale of business agreement to adjust the apportionment set out above.

Conclusions 85In those circumstances, the proper course is that adopted below, namely to invite the parties to make the necessary calculations based on payments of workers compensation insurance and the differential assessments under common law and the Civil Liability Act, as against Baden and Brambles, and under the Workers Compensation Act 1987 (NSW), as against the employer, Gillespies. When those calculations have been made, it will be possible to address any costs questions based upon the results in the appeal and possible offers of compromise. 86The Court directs that: (1) each party file and serve on each other party within three weeks of the date of this judgment a copy of its proposed orders (if not agreed) and short submissions in support thereof. (2) any party wishing to respond to the orders sought and submissions in support prepared by another party, file and serve a response within five weeks of the date of this judgment. 87WARD JA: I agree with the reasons of Basten JA and with the orders his Honour proposes. 88TOBIAS AJA: I agree with the conclusions of Basten JA for the reasons he has expressed and also with the directions that he proposes.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 27 May 2013