Bicer v McDonalds Australia Ltd

Bicer v McDonalds Australia Ltd - [2001] NSWSC 218 - NSWSC 2001 case summary — Zoe

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The mobile roadshow 2 The McDonalds roadshow has been operating since at least 1980. In 1980, Peter Wood joined the roadshow as the character of "Ronald McDonald" and Lesley Wood-Haddon joined as "Hamburglar". Since then her role has been extended to that of the characters of Hamburglar and Ringmaster. In 1983 Mr Kim Birch joined the performers and the truck driver and roadie. Two people were involved in erecting and disassembling the stage. Usually it was Mr Wood and Mr Birch who were responsible for erecting and disassembling the stage from the truck. Some 21 years later Mr Wood and Ms Wood-Haddon continue to perform as these characters but no longer from the mobile theatre. The trick has not been used since the accident. Mr Birch left the defendant's employment in 1998. 3 In 1983 McDonalds assigned the advertising agency DDB Needham Sydney Pty Ltd (DDB) to take charge of the day to day activities and control of the Ronald McDonald Circus program. DDB was responsible for the expenditure, the truck and the performers. Prior to 1993 there had been two trucks used in the circus program. The first truck came into existence in the 1980's and ceased being used in about 1987. The second truck which was referred to in these proceedings as the original truck was used for a period of six years from about 1987 until 1993. It was then sent to Queensland. DDB decided it was time to purchase another truck. Mr Jeremy Prestoe who was the sales manager of DDB had the day to day "hands on" responsibility of the Ronald McDonald show. Mr Tony Mearns was contracted by the defendant to recommend a suitable chassis, cab and body for the new truck. 4 The truck provided by McDonalds was a Mitsubishi Canter with a tare weight of 3,860 kilograms and a gross vehicle mass of 4,490 kilograms. One side of the bodywork folds from the vertical to the horizontal to form the stage for the performance. The stage was secured to the side of the vehicle with a latching bolt mounted horizontally on the side of the truck towards the top of the truck and in the longitudinal centre of the stage. The stage is unlocked by rotating the handle on the lock to at least the level of the bolt that runs lengthwise across the body of the truck. Once unlocked the stage can be mechanically lowered with the use of two winches. The stage has a weight of 226 kilograms. The winches were located at the rear of the truck, inside the body and were connected so that they would operate simultaneously and this operation was effected by a single electronic switch. The winch has a rated pull of 976 kilograms and stall load of 1,134 kilograms. The winch did not have a limit switch. 5 There was one cable, of diameter 4.76 millimetres, wound around each drum and connected to an attachment point with a clip. The attachment point was a "D" shackle and there was a "D" shackle for each winch cable on the front left and right hand edges of the stage. Each attachment point has a load capacity of 176 kilograms. The cables would pass through a hole back into the truck where they were mechanically wound onto the winch drum. 6 The major factual dispute in these proceedings was the identity of the persons who carried out the modifications to the side curtains. Much of this judgment is devoted to this issue.

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The new truck 7 Mr Mearns knew of Mr Gleb Kondakoff, the managing director of Therma Truck through his previous employment with F J Walker. Mr Kondakoff and Mr Mearns inspected the original truck to ascertain whether Mr Kondakoff could undertake the job and so he could prepare a quotation. Mr Kondakoff took photographs (Ex 8) but at this initial inspection the mobile stage could not be examined as the side door was locked. On 14 May 1993 Therma Truck Pty Limited (Therma Truck) forwarded a quotation to Mr Mearns together with a diagram showing the layout of the stage and its components which were to be included inside the body of truck body. Also forwarded with the quotations was a brochure. Both Mr Prestoe of DDB and Mr John Blyth, who was the national field and marketing manager of McDonalds and was authorised to purchase the new truck, read the quotation together with the brochure from Therma Truck. 8 In relation to the inspection of the truck prior to its delivery to the McDonalds garage, the recollections of both Mr Mearns and Mr Birch are vague. They recall that they did attend Therma Truck's factory for an inspection of the truck. As Mr Kondakoff's job involved the construction of the new body of the truck, he had the responsibility to ensure he had enough source material from the inspections and photographs to allow him to do so. I prefer his evidence on this issue. Mr Kondakoff was accompanied by Mr Mearns and Mr Birch when the truck was inspected the second time. Mr Birch demonstrated how the stage was erected for a performance. Mr Mearns supplied a photograph (Ex 10) of the stage which showed the skirting and side curtains to Mr Kondakoff. No-one told Mr Kondakoff that the side curtains were attached to the stage. Mr Kondakoff took measurements and photographs (Ex 9) of the truck. He drew a diagram (Ex A tab 1) of the layout of the truck. The diagram depicted the curtains as being loose at the bottom. On 21 May 1993 Therma Truck supplied a further quote to Mr John Blyth of McDonalds. On 10 June 1993 McDonalds placed a purchase order with Therma Truck for body work of the Ronald McDonald unit as per quotation 3560 for the sum of $26,292 (Ex A tab 3). 9 It was understood by all parties involved in the transaction namely, Mr Blyth of McDonalds, Mr Prestoe of DDB, Mr Mearns consultant and agent of McDonalds and Mr Kondakoff on behalf of Therma Truck that Therma Truck was to customise the new body of the truck (which included the stage) so it was identical to the original truck. There were a few modifications to be made. This in turn was also understood to be the position by Mr Kondakoff's employees. 10 It was Mr Kimbal Birch, the truck driver, who set up the stage for the Ronald McDonald show for many years, namely from the 1980's until 1998. It was common ground that prior to the new truck being constructed Mr Birch suggested a modification namely that the locking devise on the side door be lowered to enable him reach it without having to resort to standing on a stool. When the body work on the new mobile theatre was completed by Therma Truck, Mr Birch and Jeremy Prestoe attended the factory premises to inspect the new truck and to watch a demonstration of how the winches worked and how the stage was set up. Mr Birch has no recollection of being shown how the curtains were attached to the stage. Nor has he any recollection of being shown the method of attachment of the skirt to the stage. He did not take a great deal of notice of the demonstration other than to observe that the new truck operated in a similar manner to the original truck.

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Modifications to the body of the truck 11 In about September/October 1993 the new Mitsubishi truck with the custom made body already installed was delivered to the McDonalds garage at Thornleigh. On 27 November 1993 a show was performed from the new truck at McDonalds at Engadine. After the show had concluded, members of Therma Truck, DDB and the performers met and discussed modifications to the body of the truck and mobile stage. Present at that meeting were Jeremy Presto from DDB, Peter Wood also known as Ronald McDonald, the Hamburglar/Ringmaster Lesley Wood-Haddon, Mr Birch the truck driver, Tracy Miles the events co-ordinator from DDB, Tony Mearns the defendant's consultant in relation to the truck and Gleb Kondakoff from Therma Truck. Mr Kondakoff took photographs (Ex 11). He gave evidence that only Mr Mearns, Mr Birch and himself were present at the Engadine meeting. On this issue Mr Kondakoff's recollection is incorrect. 12 Lesley Wood-Haddon raised the issue of the side curtains. All of the McDonalds performers and truck driver had noticed that the side curtains were not secured to the stage and that there was a gap between the bottom of the side curtains and the stage of about three inches. The curtains needed to be secured to the stage because the wind blew the curtain onto the performers during the performance. Even if it was not Ms Wood-Haddon who raised the side curtain issue, Mr Prestoe, Mr Wood and Mr Birch referred to that being raised. The issue is also the subject of subsequent correspondence (referred to later in this judgment). 13 The original truck had a system of press studs placed around the perimeter of the stage by means of which the skirt was attached to the stage. Further press studs were located on the outside of the top of the skirt at the side portions so that the side curtains were clipped onto the top of the skirt. The side curtains could easily be unfastened when Hamburglar needed to exit and enter from the side of the stage. 14 At the Engadine meeting the issue of the new method of attaching the skirt to the bottom of the stage was raised as being unsatisfactory. The new method of attachment was by means of an aluminium sliding mechanism attached to a rope at the top of the curtain. Its operation is similar to that of a sail being attached to a mast (see Ex 1). Mr Birch found this new system more difficult and time consuming to implement because with the old press stud system he could simultaneously pull the press studs undone while he was folding the skirt when disassembling the stage. The original method of connecting the cables to the attachment point and the method of affixing the side curtains are shown in photographs 3 and 4 of Ex D. Photograph 4 is reproduced over.

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Correspondence concerning stage, skirting and side curtains 16 In a letter dated 3 December 1993 Jeremy Prestoe wrote to Mr Tony Mearns specifying certain items that needed modification. He requested the cost of each item referred to in his list. The list of items included that the side curtains (tarpaulin) on stage needed to reach the stage and that individual press studs were needed on the stage skirting rather than an aluminium rope affair. Further it was required that the stage curtains be lengthened to hide the feet of performers (Ex 4). 17 By letter dated 21 December 1993 Mr Gleb Kondakoff, director of Therma Truck wrote to McDonalds Australia (directed to the attention of Mr Jeremy Prestoe) with a quote. He understood that he was to make the side curtains longer and place button (my emphasis added) clips on the stage (item 2) and to provide individual press studs for stage skirting rather than an aluminium slide (item 4). This is the first time that the terminology has changed from press studs to button clips and was consistent with Mr Kondakoff's evidence as he used the term button clips. A copy of this letter was produced by both McDonalds and Therma Truck. The total of the cost of modifications is $2,124.28. Mr Kondakoff in his letter has not referred to press studs but button clips as a means of attachment. 18 On 14 January 1994 (Ex A tab 6) Mr Prestoe replied to Mr Kondakoff's letter stating that it was his understanding that it was John Blyth's brief to Therma Truck that Therma Truck was virtually to copy the original special mobile stage vehicle with one or two upgraded additions. He requested that item 2, (the side curtains clear plastic to be made longer and button clipped to the stage) and item 4, (the individual press studs to attach stage skirting instead of aluminium slide in retainer) not be considered chargeable items but that there should be no charge incurred by McDonalds for these modifications. 19 On 1 March 1994 Mr Ian McKenzie, New South Wales field marketing manager of McDonalds wrote to Mr Kondakoff (Ex 4) and confirmed the agreement for rectifying the fitting out of the Ronald McDonald mobile stage vehicle and noted that there would be no charge for the side curtains (clear plastic to be made longer and button clipped to the stage). On 29 March 1994 Therma Truck wrote to McDonalds confirming that there would be no charge for altering the side curtains and the skirting (items 8 and 9). None of the witnesses called by the cross claimant can recall when the modifications were actually completed. No-one from DDB or McDonalds specifically recalled inspecting the modified work to ensure that it was done in accordance with the agreement. 20 From September 1993 until November 1995 Ms Tracy Miles as events manager from DDB took over the responsibility of the McDonalds mobile theatre from Mr Prestoe. She thought the modifications were carried out early in 1994. She observed changes to the side curtains namely that they were clipped to the stage by means of a black eyelet. At this time she had the responsibility for the modifications and the servicing of the truck. She cannot recall inspecting the truck to check the modifications had been done properly. There were no further modifications carried out (other than the barriers were shortened at a later date). 21 In a letter dated 24 September 1999 to WorkCover (Ex 14) Nick Cleaver managing director of DDB reported a conversation that occurred between Ms Claudia Gallardo and Ms Miles. It was reported that Ms Miles said that she never organised repairs, modifications or had anything to do with the truck other than booking if for shows. Ms Miles remembers receiving a telephone call from Claudia Gallardo but says that that statement is incorrect. 22 The modifications were completed by March 1994 at the latest (see Ex 15) and this included the changes to the method of fastening of the side curtains to the stage. Instead of press studs as requested, the edges of the curtains were now affixed by means of an eyelet in the curtain with a hook passing though the eyelet. The hook was attached to the clip. The clip attached to the stage by means of black piece of metal which was secured by means of a Phillips head screw placed into the aluminium strip on the top part of the edge of the stage. It is shown in photographs 5 and 6 of Ex C (this is called the eyelet system). The eyelet system located in close proximity to the designated lifting attachment which was a "D" shackle which was placed on a black bracket, bolted and screwed into the floor by the means of at least two bolts. This "D" shackle was smaller and less secure than the one which was in the old truck. The side stage curtains were never lengthened. Photograph 5 is reproduced below.

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23 Mr Wood in his statement to WorkCover dated 21 November 1999 (Ex 3) outlined the modifications to the side curtains as per his evidence. When he asked who installed the curtain rings, he replied that he did not know. I infer that he gave this reply because he did not actually arrange for the modifications to be carried out. Mr Wood, Mr Birch and Ms Wood-Haddon all gave evidence that after modifications were carried the method of securing the stage curtains to the stage remained unaltered up until the date of the accident. The cross defendant denied installing the eyelet/hook arrangement to secure the side curtains. 24 The defendant's version was strongly disputed by Mr Kondakoff, Mr Horsley and Mr Betzis of Therma Truck (the cross defendant). The managing director of Therma Truck, Mr Gleb Kondakoff, trained as a design draftsman in Harbin China. He has no formal engineering qualifications. Mr Kondakoff gave evidence that although he was the author of the diagrams (Ex A tab 1, Ex R) he did not consider that he was designing a truck. He considered that he was copying the original truck. He understood that Mr Birch had driven the truck previously and he thought that Mr Birch would continue to operate the new truck. He was never asked to modify the truck to ensure that the border of the stage was safe for use by the staff of McDonalds. Mr Kondakoff says that it was Mr Birch the driver who suggested that a better system could be implemented for attaching the skirting to the stage. Mr Birch complained because the buttons kept falling off the curtains. Mr Kondakoff also related that sometime later he saw the driver who told him that the new aluminium rope arrangement was not satisfactory as it was difficult to thread the rope through the top of the skirt. 25 When the body work was carried out to the new truck, the making of the canvas side curtains, skirt and canopy was sub-contracted out to Bells Canvas at a cost of $800 (see invoice dated 25 August 1993 - Ex Q). Mr Glen Horsley who was then a tradesperson employed by the company, has a sheet metal tradesperson certificate and trained as a boilermaker and together with another employee Jason Hall carried out the original modifications to the body of the truck but was not involved in any of the paperwork. Mr Horsley is now the production manager at Therma Truck. Mr Kondakoff instructed Mr Horsley on the manner and nature of the work to be done. While Mr Kondakoff says that Jason Hall also helped with the later modifications, Jason Hall and Mr Horsley disagree. Mr Hall was adamant he was not involved in the modifications. Mr Horsley said that the truck came back for only one day for him to complete the modifications. Mr Betzis thought it was there for two days and Mr Kondakoff thought it was for a week. 26 Mr James Betzis, now the general manager of Therma Truck, gave evidence. In 1993 he was working for the company in sales and operations. He is qualified in hotel management. Aside from helping Mr Kondakoff with the written quotations he had no involvement in the modifications. Mr Betzis and Mr Horsley gave evidence that it was Mr Kondakoff who they believed took the curtains to Bells Canvas for lengthening. Mr Horsley remembers them unpacking the stage and removing the two side curtains and placing them outside Mr Kondakoff's office. Mr Kondakoff gave evidence that he took the curtains to Bells. Both Mr Betzis and Mr Kondakoff believe that when the original body was built the female portion of the press stud were placed along the aluminium strip located on the top of the stage. But Mr Horsley does not remember why the female portion of the press stud was placed along the aluminium strip on the front of the stage. Both Mr Betzis and Mr Kondakoff gave evidence that the aluminium slide threaded with rope was clipped by means of the press studs to the stage. Hence the female portion of the clips were placed there when the truck was originally customised by Therma Truck.

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27 Mr Horsley denies putting the curtain eyelet fitting on each front edge of the stage. Mr Horsley says that he would not have considered the eyelet and clip as a satisfactory method of securing the side curtains because the fitting was only held in the aluminium strip by one Phillips head screw which was not screwed into anything substantial. Thus the clip may swivel. If it swivelled the stage may not close properly. Mr Horsley says that Mr Kondakoff would have told him to put the pop rivets on the curtains but he does not recall doing so. While Mr Horsley was at first positive that he saw the curtains set up on the truck, he later capitulated and said that he had never see the fitted side curtains attached to the stage nor did he see the curtains when they were allegedly returned from Bells Canvas. Mr Horsley says that after he performed the work in one day, the truck was locked up and placed outside the work shop. He also said that the back eyelet is not stock that is kept in the factory. He agreed that it was possible that someone else could have put the eyelets on the truck but that it was very unlikely. 28 Both Mr Kondakoff and Mr Betzis gave evidence that they saw the curtains after they had been extended by Bells Canvas. They said that they saw the stage set up with the side curtains press studded to the stage. Mr Kondakoff gave evidence that he was pretty sure that he looked and he saw that there was a 1½" bend in the curtain after it had reached to stage. Mr Kondakoff and Mr Betzis agreed that it was inconsistent that McDonalds would have requested that the side curtains to be lengthened only to shorten the curtains once again. 29 Mr Kondakoff gave evidence that when he sent the curtains back for lengthening to Bells Canvas he was not charged for this minor alteration even though he had estimated the cost to be $80 (see Ex 12). Therma Truck's copy of the letter dated 21 December 1993 (Ex 9) has ticks placed against all item numbers where the modifications had been completed. Items 1 and 2 were not ticked. Item 2 is the side curtain (clear plastic to be made longer and button clipped to the stage). Mr Kondakoff volunteered that he could see that the curtains had been shortened at some stage because a white strip had been placed on the bottom of the curtain. He also volunteered at a later point in cross examination that he could discern some extra stitching on the corner of the curtain in Ex C photograph 5. As previously stated Mr Kondakoff gave evidence that more female parts of the press studs were placed at regular intervals on the aluminium strip on the stage when the truck body was constructed and the male component of the press studs were placed onto the aluminium strip and the female components were pressed into the bottom of the curtains by either Mr Horsley or Mr Hall. If this were true there would be both female and male portions of the press studs appearing on the aluminium strip. 30 As previously stated this was contradicted by Mr Horsley and Mr Hall. Mr Hall did not do any of the modifications and Mr Horsley could not remember pressing the female part of the press studs on the bottom of the curtains. Mr Kondakoff then said that the original male press stud at the corner had been removed and a larger hole drilled in that spot so that the eyelet could be screwed in that spot. He admitted that he should have been able to identify other male components of the press studs that were riveted to the to the aluminium strip but could not do so from the photographs. Mr Kondakoff's explanation about the work done with the male portions of the press studs and the lengthening of the curtains is unlikely to have occurred. 31 Mr Kondakoff agreed that he would not choose to secure the curtains by the curtain rings as the hook was only held by one screw and that bracket could rotate. It never crossed Mr Kondakoff's mind that someone would have made a mistake in the identification of the correct attachment point. He thought that the locking mechanism on the side of the truck was safe. 32 Mr Kondakoff gave evidence that he agreed not to charge McDonalds for the costs of having the curtains lengthened and the inserting of the press studs to annex the curtains to the side stage despite the request to construct an alternative method of connecting the stage skirting was made by a McDonalds representative namely Mr Birch. Mr Kondakoff gave evidence that when he wrote the letter, in his mind 'button clips" and press studs were exactly the same thing. He denied when being cross examined that he had made a decision not to go to the expense of lengthening the curtains but rather use the button clip method attachment. I found the cross defendant's evidence to be unconvincing. I find that the side curtains were not lengthened. If the curtains were not lengthened that meant that the cross defendant could not use the press stud method to secure the side curtains to the stage. Another method had to be adopted. I find that the cross defendant carried out the modifications to the side curtains whereby the curtain eyelet and hook method of attaching the curtain to the stage was implemented.

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Cause of the accident 33 The plaintiff gave evidence. He is currently working as a graphic designer. The defendant admitted that no written instructions were given to the plaintiff. It also admitted that were was sufficient instruction provided to the plaintiff prior to the accident occurring on 23 May 1996. Mr Bicer's girlfriend was Ms Simone Dimech's sister. Ms Dimech was employed by the defendant. At this time the plaintiff was employed elsewhere on a full time basis as a forklift driver. Ms Dimech offered the plaintiff the job as driver/stagehand of the roadshow. She told him that he was required to drive the truck, unpack and pack up the stage. He accepted the position. The terms and condition are set out as per letter dated 16 May 1996 (Ex G). 34 The first time the plaintiff saw the truck was on 16 May 1998 when he drove it from the garage at Thornleigh McDonald to North Ryde. This was the only performance the plaintiff attended prior to the accident. Ms Dimech gave him instructions as they put up the stage. They cleared out the curtains and other articles from the inside of the truck. Ms Dimech and the plaintiff returned to the inside of the truck where Ms Dimech showed the plaintiff how the switch operated the cables on both sides of the stage platform. She caused the stage platform to be lowered by operating the switch inside the truck. They observed this being done through the porthole. The plaintiff heard the winches working. He does not remember who removed the cables from the attachment points but he is pretty sure that it was not him. He thinks that he was doing something else at that time. 35 The plaintiff did not erect the side stage curtains. He was not given any instructions as to where the attachment point was located nor was he given any instruction about the attachment point generally. He did not observe how the side curtains were secured to the stage. He was not given any instructions as to where to attach the cables in order to lift the stage. He was not shown the black eyelets nor was he told anything about them. When the stage was to be disassembled after the performance, he was given instructions to fold the curtains and how to position the poles in the truck so that everything would fit. He did not remove the skirt nor the stage curtains. He was inside the truck when the stage was lifted. Ms Dimech operated the switch. At first the stage got stuck. Ms Dimech told him that if that occurred, the stage should be lowered by means of the mechanical winches by operating the switch. The switch should then be used to retry the lifting of the stage platform. I infer that Ms Dimech who was employed by the defendant had prior knowledge that the stage sometimes got stuck when it was being lifted as she knew that in order to overcome this problem to lift the stage and retry the operation. I infer that the stage had become stuck on prior occasions and this problem was never investigated. On the second attempt the stage platform was lifted until it was in its upright position. The plaintiff drove the truck to his house and did not touch it again until 23 May 1998 when he drove it to Goulburn. 36 On 23 May 1998, Ms Dimech travelled to Goulburn by means of her own transport. The plaintiff has a clear recollection that neither Ms Dimech operated the winch before he got the stool out of the truck to unlock the locking mechanism that caused the stage to be secured to the side of the truck. As previously stated the locking mechanism secured the stage door to the side of the truck. The handle to unlock the mechanism was located in the centre of the door. He put the stool on the ground directly underneath the locking devise which was in the middle of the side of the truck. He stood on the stool in order to reach the locking mechanism. He unlocked the mechanism but did not pull it towards him. The platform came down quickly. He tried to halt it but it hit his head and bent him over. The plaintiff gave evidence that had he been shown the attachment point and the curtain eyelet it would have been obvious to him that the cable should have been connected to the attachment point. 37 Despite numerous attempts to the defendant to locate Ms Dimech, it has been unsuccessful. Since October 2000 she has left the family home and has instructed family members not to give any details as to where she can be located. I accept that there is a reasonable explanation as to why she was not called to give evidence.

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Expert evidence on the cause of the accident 38 The defendant served expert reports of Mr Simpson the principal of Simpson Associates Forensic Engineering dated 9 May 2000 and 2 September 2000 and Mr Ng of Testsafe Australia dated 1 September 1999. Mr Ng has a Bachelor in Engineering from the University of Malaya and is a Member of the Institute of Engineers of Australia. He is currently head of the mechanical unit of Testsafe Australia and has held this position for 18 years. The cross defendant did not rely upon any expert evidence. Both experts were cross examined. 39 Mr Simpson gave evidence that the most important factor that caused the accident was that an employee of McDonalds connected the cables that hold up the stage onto the wrong attachment point (t 167.58) combined with the operation of the winch, by an employee of McDonalds, in such a manner that the cables were pulled from the stage (t 168.15). The second most important cause of the accident was the lack of instruction manuals from the employer or the manufacturer but the employer had the primary responsibility. The third most important cause of the accident was failure to instruct the new driver of the truck in the correct method of setting up the stage. Mr Simpson stated that the positioning of the back eyelets, by the manufacturer, in such proximity to the correct attachment points so that it was possible to connect the cable to the eyelets was the fourth most proximate cause of the accident but linked to this event was the lack of a safety inspection by McDonalds. According to Mr Simpson such an inspection would have detected the possibility of such a mistake occurring but not necessarily that the eyelet had been used on previous occasions to attach the cables. The fifth most important cause of the accident was the positioning of the locking mechanism on the rear door so that in the event of the stage breaking free of the cables, the employee opening the doors would be underneath it and would have had no means of escape. Mr Simpson ranked the absence of any warning signs near the attachment points as the sixth and final cause of the accident. 40 Mr Ng gave evidence from the point of view that one of the fundamental rules of design is that human intervention must be minimised. According to Mr Ng the most important factor that caused the injury to Mr Bicer was the positioning of the latch so that its operation required the plaintiff to stand underneath the stage without a means of escape. The proximate causes are listed in descending order of importance. He stated that the next most important cause of the accident was the proximity of the black eyelets to the correct attachment points so that the cables could be connected to the wrong clip. The third and fourth causes are the lack of operating manuals from the employee and manufacturer respectively. According to Mr Ng the manuals should have indicated the need for periodic safety inspections of the truck by McDonalds. The absence of such inspections is rated as the fifth most important cause of the accident. The sixth most important cause was the absence of warning signs near the eyelets and attachment points. 41 Mr Ng then rates the failure to train the new truck driver in the set up of the stage as the seventh most important cause of the accident. It should be noted that Mr Ng does not consider the actual attachment of the cables to the wrong connection points nor the manner in which the winch was operated as being the causes of the accident. He regarded the training that should have been provided to the employee or employees who incorrectly detached the cable and then operated the winch in such a manner that the eyelets were weakened as the least important cause of the accident. 42 I prefer Mr Simpson's evidence to that of Mr Ng but have arrived at my own decision based on their evidence. It is my view that there were three negligent acts that materially contributed to the accident. The first and most important cause of the accident was that an employee of McDonalds connected the cables to the wrong attachment point such that the curtain rings could not hold the weight of the stage. The cables had been connected to the wrong attachment point on a number of prior occasions. The employer had not instructed and trained its employees on how to assemble and disassemble the stage. It was foreseeable that if the cables were connected to the curtain rings instead of the correct attachment point that the curtain rings would not be able to hold the weight of the stage by means of the cables and there was a real risk of injury to the plaintiff. The risk was not far fetched and fanciful. The employer is vicariously liable for the acts of its employees. The employer did not provide training for the plaintiff. A response to the risk would have been that the defendant provide proper instruction and training to assemble and disassemble the stage. A second cause of the accident was the location of the black eyelet attachment point in close proximity to the cable attachment point. To an untrained person, the eyelet and the attachment point looked similar because they were located very close to each other and could be mistaken for each other. It had crossed Ms Haddon-Wood's mind fleetingly that an untrained person could attach the cables to the wrong attachment point. The manufacturer was responsible for implementing the means of attachment of the side stage curtains to the stage. These modifications were not carried out in accordance with instructions provided by McDonalds. 43 Proximity exists between the defendant and cross defendant in respect of the use of the truck in the defendant's business either by itself or its employees. Proximity also exists between the cross defendant and plaintiff as an employee using the truck in the course of his employment. There is no absolute duty on a manufacturer to design or manufacture a defect free or accident proof product (Bull v Rover Motors (Aust) Pty Ltd [1984] 2 QdR 489 at 499). If a product is inherently extremely dangerous or the gravity of the risk of injuries is serious, a higher duty of care is to be exercised. 44 A manufacturer is required to take into account any possible use or mode of operation which may reasonably be foreseeable as involving a real risk. A manufacturer is not obliged to take precautions against a risk which may arise when the use to which the product is put is so unusual or improper as to make such a use wholly unforeseeable, it falls outside the range of any reasonable mans contemplation. (Voli v Inglewood Shire Council (1963) 110 CLR 74 per Dixon CJ at 79-80; Griffiths v Arch Engineering Co Ltd [1968] 3 All ER 217 at 221-222; Poole v Crittal Metal Windows [1964] NZLR 522 (CA) at 536; Waddams, Products Liability (2nd ed 1980, Carswell) at 49-51; Miller, Product Liability (1977, Butterworths) at 294-295; Newdick, The Future of Negligence in Product Liability (1987) 103 LQR 288). However, within the range of foreseeable risk manufacturer is required to take reasonable care in the design and manufacture of the product. 45 As was stated by Cooper J in Suosaari v Steinhardt (1989) 2 QdR 477 at 489 stated: "In undertaking the process of design a manufacturer is under a duty 'to design his machine so as to keep its inherent dangers to a minimum and so as to avoid the addition of further risks which [are] not inherent' ( Todman v Victa Ltd [1982] VR 849 at 852 per Lush J and see to similar effect Murphy J at 857). Discharge of the duty requires the designer to think through the suitability of the design, the problems and risk associated with the design; the graver the foreseeable consequences of failure to take care, the greater the necessity for special circumspection. ( Independent Broadcasting Authority v EMI Electronics Ltd (1980) 14 BLR 9 (HL) at 28, 31; Winward v TVR Engineering [1986] BTLC 366 (CA). The standard to be applied when one is dealing with a machine is that of a reasonably competent engineer ( Winward at 5; Griffiths at 220-222). Where the risk is real, although the incidence of it may be low, the designer is under a duty to minimise the risk by taking all reasonable steps to eliminate it, particularly where the alteration to the design is simple and inexpensive." 46 It is not disputed that the requisite degree of proximity exists between a manufacturer and the user of the article produced because the user is so closely and directly affected by the act of designing and manufacturing an article that the manufacturer ought reasonably to have the user in contemplation as being affected when the manufacturer is directing his mind to the sufficiency of the design and manufacturing process, the safety of the product and the circumstances of distribution at the time when he places the product into circulation for use or consumption (see Donoghue v Stevenson [1932] AC 562 at 580, Jaensch v Coffey (1984) 155 CLR 549 at 579). 47 A reasonably competent engineer or even a person with the most rudimentary mechanical skills should have directed its mind to the danger of placing the curtain eyelet near the attachment point. It was an obvious danger and there was a cheaper and safer alternative, namely the press studs which had been implemented previously and were supposed to be repeated in the modification. A cheap and practical response which could have been taken to obviate the risk of the employee attaching the cable to the wrong attachment point was available. The cheap and practical alternative to the method of attaching the side curtains to the stage was the placing the button clips on the edge of the stage and on the curtains as had been done on the old truck. This is what McDonalds requested to be done. 48 A third negligent act which materially contributed to the accident was the positioning of the latch in the middle of the side door so that when a person was unlocking the stage door he or she was standing in a position directly underneath the stage door. If the cables did not hold the stage door firmly in the upright position when it descended that employee had no means of escape. Both the employer and the manufacturer were responsible for deciding on the position of the locking mechanism. It was a McDonalds employee who suggested the height of the mechanism. By that, the manufacturer was entitled to believe that McDonalds was otherwise satisfied with the locking mechanism but as the locking mechanism was drawn to its attention it did have a duty of care to ensure that it was safe for use. 49 It was foreseeable that there was a real risk of injury to the plaintiff if the cables were connected to the wrong attachment point the eyelets would not be able to hold the weight of the descending stage and would break causing the stage door to fall on the person unlocking the door and that person would have been put in a position whereby he or she was unable to escape. A cheap and practical response to the risk was to move the position of the locking mechanism from the middle of the outside of the stage or the side or sides of the stage of the truck instead of the middle. Both the manufacturer and the employer were negligent. As a result of the defendant and cross defendant's negligent acts, the plaintiff was seriously injured.

[26]

(b) shall have the same rights in respect of the person's defence against the claim as if the person were a defendant in separate proceedings commenced by the defendant for the purpose of that claim." 59 The defendant referred to McDonnell and East Limited v McGregor (1936) 56 CLR 57-58. This case was decided at the time when there was a distinction between a set off and a counter claim. This distinction was abolished by the SCA 1970. 60 In both Sidney Raper Pty Limited v Commonwealth Trading Bank of Australia [1975] 2 NSWLR 227 and Henriksens Roder A/S v THZ Rolimpex (the Brede) [1974] QB 233 it was decided that the distinction between set off and counterclaim by way of a separate action was irrelevant when referring to the Limitations Act 1939. As such the cross claim is time barred. Section 74 of the Limitation Act and s 78 SCA do not assist the defendants case. As previously stated the claims the breach of contract fail. 61 If I am wrong, I turn to consider whether Therma Truck breached its term either express or implied of the contract dated 10 March 1993. (1) Express conditions of the contract 62 The defendant alleged that the agreement dated 1 March 1994 contained the express terms that the design of the proposed modifications as provided by Therma Truck would ensure that the portable stage would be safe to use by McDonalds, its servants and agents and that Therma Truck would modify the truck in accordance with the specifications so as to ensure that the portable stage was safe to be used by McDonalds, its servants and agents. The defendant alleged that the particulars of the express terms of the contract were firstly, failure to design the locking mechanism so that when operated the operator would not have to stand beneath the stage; secondly, failing to adequately or at all locate the locking mechanism in a position whereby if the lowering mechanism failed, the operator would not suffer injury; thirdly, failing to adequately or at all by notice or sign identify the correct attachment points for the winch cables to the stage; fourthly, installing button clips to secure the curtains to the stage at a point in close proximity to the attachment points without providing any adequate notice or a sign to warn that such button clips were not to be used for attachment of the lifting cables; fifthly, failing to provide and/or supply a winch/hoisting system which contained a limiting switch to prevent over-tensioning on the ropes and undue stresses being exerted upon the lifting attachment points located on the stage; sixthly, failing to produce and supply with the truck an operating manual or other documentation so as to properly instruct users of the truck in its safe operation; and seventhly, failure to adequately or at all supply and/or affix to the stage decals or notices warning persons that the lifting cables should not be attached to the button clips, but only to the attachment points provided. 63 The letter of 1 March 1994 by Ian McKenzie, the New South Wales field manager of DDB to Mr Kondakoff stated that he was pleased to confirm the agreement for the rectifying of the fitting out of the Ronald McDonald mobile vehicle. There is no express term that the design of the proposed modifications as provided by Therma Truck would ensure that the portable stage would be safe to use by McDonalds, its servants and agents and that Therma Truck would modify the truck in accordance with the specifications so as to ensure that the portable stage was safe to be used by McDonalds, its servants and agents. The locking mechanism, the winch system, the manual and warning signs were not an express part of the agreement of 1 March 1994 nor the 10 May 1993 agreements. However two of the rectifications agreed in the agreement of 10 March 1994 to were firstly, the side curtains were to be made longer and button clipped to the stage; and secondly, that there were to be individual press studs for the stage skirting instead of aluminium slide in the retainer. As previously stated these rectifications were not carried out in accordance with the agreement. The cross defendant breached its agreement with the defendant and is liable for damages. The quantum of damages was not disputed.

[27]

(2) Implied terms of the agreement 64 Therma Truck's brochure advertises itself as an insulated and refrigerated truck body specialist. It says that the first truck body it built was in 1970 for a small goods firm and it is still on the road. Under a heading "Reliability" it says that because of the simplicity of the modular construction they are able to construct each unit individually, custom built for every one of its customers. Under the heading "Material" it says that they use their specifically designed components, parts and equipment. 65 The defendant alleged that the particulars of the implied terms were identical to those of the express terms. They are firstly that Therma Truck would design, manufacturer and modify the truck so that it was fit for its intended purpose and was of merchantable quality pursuant to ss 19(1) and (2) of the Sale of Goods Act 1923. Secondly, that Therma Truck would ensure that the design and manufacture of the truck was such that the truck would be reasonably safe for use by the employees of McDonalds. The defendant alleged that both these implied terms were also breached by the cross defendant. 66 The defendant alleges that it was an implied term of the agreement that the cross defendant, by its servants and agents, would exercise all due care, skill and diligence in the preparation of the design and manufacture of the modifications of the truck and failed then to do so. 67 In Codelfa Constructions Pty Limited v State Rail Authority of NSW (1982) 149 CLR 337 at 347 Mason J stated: "The true rule is that evidence of surrounding circumstances is admissible to assist in the interpretation of the contract if the language is ambiguous or susceptible of more than one meaning. But it is not admissible to contradict the language of the contract when it has a plain meaning. Generally speaking facts existing when the contract was made will not be receivable as part of the surrounding circumstances as an aid to construction, unless they were known to both parties, although, as we have seen, if the facts are notorious knowledge of them will be presumed." 68 For a term to be implied into a contract a term, the following conditions must be satisfied. Firstly, it must be reasonable and equitable; secondly, it must be necessary to give business efficacy to the contract so that no terms will be implied if the contract is effective without it; thirdly, it must be so obvious that "it goes without saying"; fourthly, it must be capable of clear expression; and fifthly, it must not contradict any express term of the contract. As I have found that as there has been a breach of an express term of the agreement, it is not necessary to determine whether there was a breach of an implied term of the contract.

[28]

(3) Breach of the Trade Practices Act 69 The defendant alleges that at the time of the preparation of the quotation and the provision of Therma Truck of the design and specifications, Therma Truck made the following express and implied representations to Mr Mearns, the agent of the defendant that; firstly, Therma possessed the requite skill, knowledge and expertise to design the truck in accordance with the requirements of McDonalds; secondly, that Therma possessed the requisite skill, knowledge and experience to manufacture and thereby modify the body of the truck so as to enable McDonalds and its staff to use the truck as a portable stage for the Ronald McDonald Show; thirdly, that the Truck when modified would be appropriate for the purpose of McDonalds; and fourthly, that the modifications to the Truck including all components and machinery would be safe for use by McDonalds, its servants and agents. 70 Section 82(2) of the Trade Practices Act states that an action must be commenced within three years from the date that the cause of action accrued. The accrual date is held to be the date at which the injured party failed to receive the benefit of the work that was to be completed under the contract. In this case that must be from the date at which the modifications were completed, namely 31 March 1994 and as such the cross claim is statute barred. 71 In relation to whether the cross defendant breached s 52 of the Trade Practices Act, the three people who were involved in the awarding of the contract to Therma Truck were Mr Prestoe, Mr Blyth and Mr Mearns. Mr Prestoe relied on the brochure provided by Therma Truck to the extent that it gave an indication that Therma Truck was an experienced manufacturer whose goods and workmanship were of a certain level of quality (t 20.9). Mr Blyth stated that he had no experience with truck or related subjects so he relied on Mr Mearns as he had quite a deal of expertise in the area (t 87.28). Mr Blyth was however given a copy of the brochure which he recalls reading (t 87.14). Mr Mearns recalled receiving the brochure but does not think he would have looked at it in detail (t 98.32). 72 Mr Kondakoff stated that he never told McDonalds the design or modifications of the truck would ensure the safety of the truck for use by McDonalds employees or agents (t 244.25). He stated that they were not designing a truck, in his opinion, but rather copying an existing truck (t 246.37). Mr Kondakoff stated that Therma Truck did hold themselves out as having specialised skills in relation to the design and manufacture of truck parts (t 257.10). This evidence does not accord with the representations made in the brochure. No risk assessment of the truck was made by the cross defendant. Mr Kondakoff assumed that McDonalds would, or would have, checked the truck as it was a copy that had been in existence for many years (t 283.37). Whilst Mr Kondakoff was aware that the driver Mr Birch, whom he had met, would be the only person who would operate or drive the truck (t 243.42) he was also aware that people other than Mr Birch could be employed to drive the truck (t 260.41). It is not necessary to determine this issue.

[32]

78 The defendant referred to Voli; Adelaide Chemical & Fertilizer Co Ltd v Carlyle [1940] 64 CLR 521; Suosaari v Steinhardt (1989) 2 Qd.R. 477; Australian Shipbuilding Industries (WA) Pty Limited v Packer & Ors (1993) 3 WAR 375; Martin v Stratman & Anor (1994) ATR 61,051 and Robinson v Halvorsen Boats Pty Ltd ("The Kangaroo') (1990) ATR 81,042. The cross defendant referred to Podrebersek v Australian Iron & Steel Limited (1984-85) 59 ALR 529, and Wynbergen v Hoyts Corporation Pty Limited (1997) 149 ALR 25. 79 The courts recognise that there are concurrent and successive causes of damage on the footing that liability will be appointed between the wrong doers. 80 The making of an apportionment as between a plaintiff and a defendant of their respective shares in the responsibility for the damage involves a comparison both of culpability, ie., of the degree of departure from the standard of care of the reasonable man and of the relative importance of the acts of the parties in causing the damages. It is the whole conduct of each negligent party in relation to the circumstances of the accident which must be subjected to comparative examination. (see Podrebersek at 532). 81 Perhaps the most instructive of those cases cited by the parties is Suosaari. Suosaari manufactured trailers used to transport sugar cane tramway bins. It sold one to the plaintiff's employer for use on their farm. The trailer was designed with a pawl and ratchet in close proximity to the place where a wire winching rope was wound on to a cylinder. Redesign of the pawl to move it away from that place would have been simple, reasonably practicable and relatively inexpensive. In order to prevent the pawl from dislodging by itself, it was necessary to engage it while the rope was being wound. 82 The plaintiff, a farm labourer employed by the respondents, was injured in the course of his employment when he placed his hand between the rope and the moving cylinder while endeavouring to engage the pawl. He knew that it was dangerous to bring his hand in close proximity to the rope and moving cylinder. The employer had instructed him not to engage the pawl until the cylinder was stationary. The trial judge held that the employers were liable to pay damages to the plaintiff, and that the manufacturer was liable in negligence. The employer was orders to contribute 60% of the amount of the damages and the manufacturer was liable to pay 40% of the amount of damages. There are two striking differences between Suosaari and the case before this court. The manufacturer in Suosaari was not asked to replicate an existing trailer used by Steinhardt. In Suosaari, the employer had instructed the plaintiff how to operated the equipment. 83 The three causes of the accident were firstly, an employee of the defendant actually attaching the cables to the wrong attachment points. The second cause was the location of the curtain ring attachment which was in close proximity to the proper cable attachment point and the third cause was the location of the locking mechanism. The defendant was wholly responsible for the first negligent act. The manufacturer for the second and both were responsible for the third negligent act. 84 As previously stated it was an employees act in attaching the cables to the curtain eyelets that was the main cause of the accident. The employer is vicariously responsible for this negligent act. After Mr Birch left the defendant's employ, the employer had not carried out any instructions as to the correct method in assembling and disassembling the stage. This resulted in the cables being attached to the curtain rings on a number of prior occasions without the error being noticed. The modifications had been incorrectly carried out by the cross defendant in 1994. For a number of years the employees of the defendant had been aware that the modifications to the side curtains had not been done properly yet nothing was done by the defendant to rectify this. However the manufacturer took a short cut with the modifications and Mr Kondakoff and Mr Horsley of the cross defendant agreed that the curtain eyelets were totally unsuitable to secure the cables. The danger of putting two similar attachment points of similar appearance in close proximity should have been obvious to the manufacturer. Both McDonalds and the manufacturer decided on the location of the locking mechanism. Taking all these factors into account, I assess the employer/defendant's responsibility at 70% and the manufacturer/cross defendant's responsibility at 30%. 85 I order that the defendant contribute 70% of the amount of damages awarded to the plaintiff and the cross defendant contribute 30% of the amount of damages awarded to the plaintiff. I reserved the question of costs for further argument.

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