Braverus Maritime Inc v Port Kembla Coal Terminal Ltd

Federal Court of Australia (Full Court)|2005-07-01

Introduction 1 On 15 April 2002, on a fine sunny day, with hardly any wind, clear visibility and calm flat water the bow of the Capesize bulk carrier "SA Fortius" (Fortius) struck at almost a right angle the bulk coal berth in Port Kembla inner harbour and one of the rail-mounted ship loaders that happened to be parked at the point of contact. 2 The plaintiff, Port Kembla Coal Terminal Limited, was the lessee and occupier of the bulk coal berth, including the various pieces of machinery situated there. The plaintiff sued the owner of Fortius, Braverus Maritime Inc (Braverus), for damages under a general maritime claim pursuant to s 4(3)(a) and (d) of the Admiralty Act 1988 (Cth). 3 The defendant, Braverus, denied liability and cross-claimed against the Port Kembla Port Corporation (the Corporation) on a number of grounds. Central to understanding how Braverus could claim that it was not at fault and to understanding the bases for the cross-claim is the fact that on the bridge of Fortius at all relevant times, in company with the master, was Capt James who acted as the pilot and who had been provided to Braverus by the Corporation. We say "acted as the pilot" because Capt James was, in fact, not relevantly licensed. This lack of a licence had been brought about (to use the words of the primary judge) by "bureaucratic ineptitude" in connection with the taking of the prescribed steps in effecting his appointment. There was no issue litigated that Capt James was not qualified by training and experience to act as a pilot on a ship such as Fortius and to hold the relevant licence. Port Kembla was a compulsory pilotage port under relevant New South Wales legislation. 4 The proceedings were called on for hearing on 5 April 2004. They lasted 31 days, including over a week of oral addresses. Voluminous written submissions were filed. On 17 September 2004, the primary judge (Hely J) published reasons of 181 pages dealing with all issues other than costs. (See (2004) 140 FCR 445.) We wish to pay tribute to the careful and thorough reasons of the primary judge. Although the appellant, Braverus, takes issue in important respects with some aspects of the approach of the primary judge to the facts, it is fair to say that his Honour's careful attention to the detail of the case and his pellucid exposition of issues of law and fact have made the task of the parties and the Court immeasurably easier. 5 By way of introduction, it is appropriate to set out the essential factual background, which is largely taken from the reasons of the primary judge. 6 Fortius is a gearless Capesize bulk carrier. She was 87,542 tonnes gross tonnage, 171,509 deadweight tonnes at summer load line, her length over all was 289.08 metres, with a beam of 45 metres. She was built in 2001. Engine room, accommodation and bridge were aft, with the bridge being 246.3 metres from the bow. There was direct bridge control of the engine. 7 Fortius had been chartered to lift a cargo of 130,000 tonnes of coal from Newcastle and Port Kembla for discharge at Rotterdam. On 14 April 2002, she loaded 55,410 tonnes of coal in Newcastle. She sailed to Port Kembla on the morning of 15 April 2002 thus loaded and with ballast, giving her a displacement of approximately 110,0000 tonnes. She arrived off Port Kembla at about 1300 hours on 15 April 2002, at which time Capt James boarded. 8 The master was Capt Ryszard Krol, a Pole by nationality, who had gone to sea in 1971, had achieved the rank of master in 1987, had first acted as a chief officer on a Capesize vessel in 1991 and had been in command of Capesize vessels since 1997. Capt Krol had visited Port Kembla once before, in May 1997, as master of a Capesize bulk carrier which discharged iron ore at a discharge berth on the southern side of the inner harbour. 9 An understanding of what occurred is assisted by reference to a chart of the harbour reproduced by the primary judge on page 7 of his reasons and to two versions of the same chart with the position of Fortius at different times marked thereon which were (with some additions) pp 32A and 33 of annexure BMI1 to the statement of Capt Krol. These three copies of the chart are as follows.

10 The additions placed on p 33 are the names of the tugs (the shapes representing the tugs were part of the evidence) and the identification of the dolphins (piled moorings). The numbers in circles with the suffix "LT" represent the time, "local time". For findings as to time, however, the careful and precise findings of the primary judge should be consulted. The bulk coal berth can be seen on the north-eastern side of the inner harbour and is marked, "Bulk Coal Berth No 2" to the north of the "Old Coal Loader". The discharge berths on the south side of the inner harbour are marked adjacent to the "No 1 Products Wharf" and north-west of the "BHP Shipping Office". 11 The smaller scale chart in the bottom left corner shows the north facing entrance to the outer harbour at the breakwater, through which Fortius proceeded before turning to starboard in the outer harbour and proceeding through 'the cut', being the narrow channel connecting the inner and outer harbours. Once inside the inner harbour, it was necessary to turn Fortius so that her bow headed south in order that she could be pushed in northerly and easterly directions for berthing at "Bulk Coal Berth No 2" as marked on the chart. (We will hereafter refer to the relevant berth either as CB2 or the no. 2 berth.) This manoeuvre involved a swing to starboard through approximately 240 degrees from entry into the inner harbour to the position at which the tugs would push her towards the berth. The tugs that accompanied Fortius into the inner harbour were to assist in the swinging manoeuvre and were then to push her astern and then sideways towards CB2 in a broadly northerly then easterly direction, with Fortius berthing port side to. 12 The primary judge succinctly and clearly summarised the accident at [15] of his reasons: In carrying out the swinging manoeuvre, the Fortius moved too far north and too close to CB2. As the Fortius was being swung, her bow collided with CB2 towards the southern end of that berth at an angle of about 80 to 90 degrees to the berth (which lies at an angle of about 5 or 10 degrees off due north/south), causing damage to the berth structure and to the No 1 ship loader. It was generally accepted that the collision occurred at about 13:59 hours on 15 April 2002. There was a 'v' shaped indentation of approximately 2 metres in the concrete structure of the berth where the starboard bow of the Fortius collided with it on a heading of about 78 degrees. The bulwark came into contact with the No 1 ship loader, causing it to be derailed and rendered unstable. The cost of repairing the No 1 ship loader alone is claimed to be $5,889,090.20. The cost of rectifying the damage to the berth and the ship loader, and some incidental expenses, are claimed by the plaintiff to be $16,110,548.47. 13 Two dramatically different versions of relevant events were given by Capt James, on the one hand, and Capt Krol and members of the ship's crew, on the other. Capt James attributed the accident to a failure by Capt Krol, the chief officer and the helmsman to execute his helm and engine orders, which, Capt James said, were ignored and countermanded. Capt Krol (supported in evidence by the chief officer and helmsman) denied this. He attributed the accident to the faulty navigation and ship handling of Capt James. The primary judge rejected Capt James' evidence. He found, however, both Capt James and Capt Krol to have been negligent, in what they, respectively, did and did not do, apportioning responsibility between Braverus and the Corporation (if that became relevant) as 60% to the Corporation for Capt James' role and fault and 40% to Braverus for that of Capt Krol. There was no issue but that human error caused the accident. 14 It is unnecessary for the resolution of the appeal to deal with much of that conflict of evidence. However, in due course, it will be necessary to say something of what happened in the minutes before impact. Paragraphs [18] to [20] of the primary judge's reasons, which should be read with the copy of the chart above marked 32A (showing Fortius in a position where her bow was approximately 150 m west of CB2), reveal how his Honour approached the exposition of what happened: Whatever the cause of the Fortius' movement to the north, a point arose when both Pilot and Master recognised that there was a risk of collision between the vessel and CB2, but that if appropriate action had then been taken, the collision would have been averted. That point was when the Fortius was approximately 150 m west of CB2, on a heading of approximately 35 degrees, and travelling at about 1 knot. At that point (which I shall refer to as 'the 150 m point'), both the Pilot and the Master were of the view that the Fortius' engines should have been stopped and then put to full astern. If necessary the tugs could have been deployed to further arrest the movement of the vessel towards CB2. There are conflicts in the evidence as to what orders the Pilot gave both before and after this point, and as to whose fault it was that a full astern order was not implemented in time to prevent a collision from occurring. The 150 m point is therefore a useful reference point, as the failure to take appropriate action at the 150 m point was directly causative of the collision. The evidentiary conflicts are also more generally relevant, since should the issue of allocation of responsibility fall for decision, contrary to the Corporation's submissions, the conflicts between the accounts of the Master and the Pilot become relevant to that question. Although the damage sustained by the berth and ship loader was extensive, the collision was a very near thing. Had the Fortius' position and/or heading immediately prior to the impact been slightly different, then the collision would probably not have occurred. Captain Kirkland, an expert witness called by the plaintiff and who had inspected the impact, gave it as his opinion that if the Fortius had been put astern 10 or 12 feet earlier, then she probably would not have touched the berth.

The issues between the plaintiff (Port Kembla Coal Terminal) and defendant (Braverus) 15 The plaintiff's case was that the master and crew were negligent in the navigation of Fortius in the inner harbour for which negligence Braverus was vicariously liable. Its alternative case was that Capt James was negligent in the conduct of the pilotage for which Braverus was said to be liable, in particular by reason of s 410B(2) of the Navigation Act 1912 (Cth) and s 85(2) of the Ports Corporatisation and Waterways Management Act 1995 (NSW) (the PWCM Act). 16 Braverus denied any negligence on the part of Capt Krol and the crew and said that Capt James was solely to blame. It said that ss 410B(2) and 85(2) did not operate to make Braverus liable because Capt James was not licensed. Section 410B(2) was said not to apply for two further reasons: Fortius was said to be on an intra-state voyage (from Newcastle to Port Kembla), and if it purported to apply it was constitutionally invalid as effecting an acquisition of property without the provision of just terms as required by s 51(xxxi) of the Constitution. 17 The defendant also said that the plaintiff contributed to the loss by its own negligence in failing to comply with its own procedures in the placement of the no 1 ship loader during the berthing operation. Issues of damages, betterment and unreasonableness arose in respect of quantum. 18 On the appeal, there was no issue taken with the primary judge's conclusion that Capt Krol was negligent and that his negligence was a cause of the accident. Thus, as between the plaintiff and the defendant, the issues as to the operation of s 410B of the Navigation Act and s 85 of the PCWM Act fell away. Braverus was vicariously liable for the neglect of its employee, the master, Capt Krol. 19 No quantum issue arose. 20 Two issues were live on the appeal between these parties: (a) whether the primary judge was correct in refusing to effect a reduction of the damages to which the plaintiff was otherwise entitled by applying s 9 of the Law Reform (Miscellaneous Provisions) Act 1965 (NSW) for its asserted contributory negligence; and (b) whether the exercise by the primary judge of the discretion to award the plaintiff indemnity costs miscarried. 21 Issue (b) above depended in large part upon issue (a), in that the basis of the award was the fact that the plaintiff recovered a sum greater than that which it offered to accept in an offer of compromise made before the hearing. That offer would not have been beaten, if we may use that expression, by the plaintiff if a significant reduction in the damages had been made by the primary judge for contributory negligence.

The issues between the defendant (Braverus) and the cross-defendant (the Corporation)

22 The primary judge succinctly summarised the issues at the trial between Braverus and the Corporation at the hearing at [28] to [31] of his reasons: If the Master and the Pilot are both found to be liable in negligence, an issue for determination on the Second Further Amended Cross Claim filed for the defendant ('the cross claim') is the relative responsibility as between the Master and the Pilot for any damage sustained by the plaintiff. Irrespective of whether such a finding is made, the Corporation's liability to the defendant under the cross claim falls for determination. The defendant contends that the Corporation is liable to it in contract, under s 82 of the Trade Practices Act 1974 (Cth) ('the Trade Practices Act') and in tort. The Corporation puts these claims in issue and contends that, in any event, it has the benefit of the statutory immunities created by s 410B of the Navigation Act and s 85 and s 86 of the PCWM Act. The defendant denies that these sections have any relevant application. If any statutory defence is prima facie available to the Corporation under s 85 and s 86 of the PCWM Act, then the defendant contends that those sections are invalidated by Part IV of the TPA. They are also inconsistent with s 52, 82 and 87 of the TPA and, pro tanto invalid by reason of s 109 of the Constitution. To the extent that any defence or immunity is prima facie available to the Corporation under s 410B of the Navigation Act, the defendant asserts that the section is constitutionally invalid as it effects an acquisition of property, viz the defendant's common law causes of action against the Corporation, without the provision of just terms. 23 In the appeal there was no argument put that ss 85 and 86 of the PCWM Act were invalid by reason of inconsistency with Part IV of the Trade Practices Act (1974) ("TP Act"). There was no issue on appeal as to the invalidity of s 410B of the Navigation Act or as to the application of s 410B to the voyage in question. There was also no issue on appeal as to the respective proportions of Braverus and the Corporation for the responsibility for the damage if division of responsibility, through apportionment, became relevant. The parties agreed to vary the primary judge's division of 60:40 (pilot:master) to 60.5:39.5 (pilot:master). Other issues fought and decided below were the subject of the appeal. Those issues concerned: (a) the proper construction and operation in the circumstances of this case of s 410B of the Navigation Act and s 85 of the PCWM Act; (b) the asserted liability of the Corporation under the TP Act by reason of its misleading or deceptive conduct through Capt James; (c) the ambit and construction of s 86 of the PCWM Act; and (d) the claim based on breach of contract. 24 We propose to deal firstly with the appeal concerning the Corporation.

The proper construction and operation in the circumstances of this case of s 410B of the Navigation Act and s 85 of the PCWM Act

25 Section 410B of the Navigation Act and its State analogue, s 85 of the PCWM Act, are central to the disposition of the issues in the appeal - in both the notice of appeal and the notice of contention. 26 Section 410B of the Navigation Act is in the following terms: (1) A pilot who has the conduct of a ship is subject to the authority of the master of the ship and the master is not relieved from responsibility for the conduct and navigation of the ship by reason only of the ship being under pilotage. (2) Notwithstanding anything contained in a law of the Commonwealth or of a State or Territory, the owner or master of a ship navigating under circumstances in which pilotage is compulsory under a law of a State or Territory is answerable for any loss or damage caused by the ship, or by a fault of the navigation of the ship, in the same manner as the master or owner would if pilotage were not compulsory. 27 Section 85 of the PCWM Act is in similar terms: (1) A person who is employed as a pilot by the pilotage service provider and who has the conduct of a vessel is subject to the authority of the master of the vessel. The master is not relieved from responsibility for the conduct and navigation of the vessel merely because the vessel is under pilotage. (2) The master and the owner of a vessel being navigated under circumstances in which pilotage is compulsory are jointly and severally liable for any loss or damage caused by the vessel or by any fault of navigation of the vessel in the same manner as if pilotage were not compulsory. 28 The word "pilot" is defined in s 6 of the Navigation Act as meaning: a person who does not belong to, but has the conduct of, a ship 29 The "pilot" of a vessel is similarly defined in s 3(1) of the PCWM Act as meaning: the person who has the conduct of the vessel but who does not belong to the vessel 30 The primary judge found that s 410B(2) operated to deny Braverus the ability to sue the Corporation in tort or for contribution. It was not necessary for the primary judge to consider the operation of s 410B(2) on the claims in contract and based on contravention of s 52 of the TP Act, because his Honour otherwise dismissed those claims on their merits. The notice of contention of the Corporation asserts that even if the primary judge were wrong in thus dismissing the contract and TP Act claims, the effect of s 410B(2) was to deny Braverus those claims. 31 On appeal, Braverus submitted that the primary judge had erred in his understanding and application of s 410B(2) of the Navigation Act (and its State analogue, s 85(2) of the PCWM Act). First, it was said that the unlicensed status of the pilot and the consequences thereof, particularly those based on an application of the Scottish case of Holman v Irvine Harbour Trustees (1877) 4 Sess Cas (4th Ser) 406, were not given determinative effect by the primary judge as they should have been. 32 Secondly, it was said that the primary judge wrongly concluded that the decision of the majority of the High Court in Oceanic Crest Shipping v Pilbara Harbour Services Pty Limited (1986) 160 CLR 626 required him to conclude as he did, when there were at least three grounds for distinguishing that case. 33 Thirdly (and related to the second asserted error), it was said that the primary judge failed to apply the Law Reform (Vicarious Liability) Act 1983 (NSW) (LR(VL) Act), notwithstanding not having been referred to it. 34 Fourthly (and related to the first asserted error), it was said that s 410B(2) did not apply because Fortius was not "navigating under circumstances in which pilotage was compulsory", because Capt James was unlicensed. 35 The underlying theme to all these submissions was that the primary judge had misunderstood, in a fundamental way, the meaning of s 410B, which misunderstanding arose from a failure to appreciate the true purpose of s 410B(2) in its historical context. The fundamental error was the failure to recognise that s 410B(2) was directed to circumstance in which the pilot was duly licensed. If the pilot was not licensed he or she could not be a public officer exercising independent duties, thereby making the defence of compulsory pilotage unavailable. Thus, it was said, in these circumstances, s 410B did not apply to make the shipowner responsible. This approach was said to be mandated by 130 years of binding case law that had been accepted by the High Court.

The approach to the construction and interpretation of s 410B and s 85 36 The ordinary rules of the Australian common law of statutory interpretation can be seen expressed in K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 157 CLR 309 especially at 315; Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 at 421-424 specifically approved by the Full Court of the High Court in Bropho v State of Western Australia (1990) 171 CLR 1 at 20; CIC Insurance Ltd v Bankstown Football Club Ltd (1995) 187 CLR 384 at 408; Newcastle City Council v GIO General Ltd (1997) 191 CLR 85 at 112; Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-82 [69]-[70] and 384 [78]; Eastman v Director of Public Prosecutions of the Australian Capital Territory (2003) 214 CLR 318 at [1], [32], [34], [35], [36] and [140] footnote 99; Network Ten Pty Ltd v TCN Channel Nine Pty Ltd (2004) 217 CLR 273 at [10]-[11]; and Stevens v Kabushiki Kaisha Sony Computer Entertainment (2005) 79 ALJR 1850. These cases can be seen as providing for a common law approach by which the relevant words of a statute, by reference to the language of the statute viewed as a whole, are considered in their legal and historical context, having regard to the evident aim and purpose of the legislation, to any established canons of legal construction and to any inconvenience or improbability of result of any given construction. Inconvenience or improbability of result may assist the court to reach an available alternative construction reasonably open and more clearly conforming with the legislative intent otherwise discerned. Fundamental to the task, however, is the giving of close attention to the text and structure of the relevant provisions as the words used by Parliament. 37 In this case, the need for an understanding of historical context is made evident by the terms of s 410B(2). The provision directs an inquiry as to the "manner" in which the master or owner would be "answerable" for loss or damage "if pilotage were not compulsory." It is necessary to understand the consequences of the relationship of non-compulsory pilotage thus posited. Indeed, Braverus relies upon this historical context because the words of s 410B(2) do not, of themselves, indicate that the operation of the provision is contingent upon the pilot being licensed. Nor, as appears from the definition of "pilot" in the Navigation Act, is there any apparent textual basis to import the qualification that s 410B(2) applies only if the relevant pilot is licensed or that it applies only in a restricted manner if the relevant pilot is unlicensed. 38 It is convenient to approach the analysis by dealing with two separate, but related, questions concerning the meaning and operation of s 410B: first, whether or not it applies, in particular in the circumstance of the pilot not being licensed, and, secondly, if it does apply, the extent of its operation. Our view as to s 410B 39 For the reasons that follow, we are of the view that s 410B(2) applies if a pilot (that is, someone who has the conduct of, but does not belong to, the ship) is unlicensed and all other criteria for its operation have been met, and that the consequence of that application is that Braverus, as shipowner, is answerable for any fault of the pilot on the hypothesis that the pilot was the servant of Braverus.

The background to the provisions antecedent and analogous to s 410B

40 In the United Kingdom in the 19th century, the question of responsibility of a shipowner for the fault of a pilot was governed both by the general law and statute. The general law position, subject to general law or statutory exceptions, was that the pilot was the servant of the owner and that the owner was answerable for the pilot's negligence: The 'Neptune the Second' (1814) 1 Dods 437; 165 ER 1380 at 1380-81; The 'Maria' (1839) 1 W. Rob 96; 166 ER 508; The 'Eden' (1846) 2 W.Rob 442; 166 ER 822; The 'Halley' (1868) LR 2 PC 193 at 202; 5 Moore NS 262 at 273 and 274-75; 16 ER 514 at 518; The 'Hector' (1883) 8 PD 218 at 224; and see Townsville Harbour Board v Scottish Shire Line Ltd (1914) 18 CLR 306 at 326-27. This position was so, notwithstanding the law in other areas that the employment of someone exercising a distinct calling did not make the "employer" of that person liable for his fault: Milligan v Wedge (1840) 12 Ad & E 737 at 740-42; 113 ER 993 at 994-95; and Laugher v Pointer (1826) 5 B & C 547; 108 ER 204: see The 'Eden'. The exception at general law to this responsibility of the shipowner for the fault of the pilot, as master responsible for the fault of his servant, was the circumstance where the owner was compelled to take the pilot. This element of compulsion was said to prevent the relationship of master and servant arising because it denied free choice: The 'Maria' at 106-108 (513) and The 'Annapolis' (1861) Lush 295 at 312; 167 ER 128 and 137. 41 Exception was also made under statute. The development of the relevant statutory provisions is helpfully set out by Douglas & Geen on the Law of Harbours, Coasts and Pilotage (5th Ed 1997) ("Douglas & Geen") Ch 19. The "General Act", 6 Geo IV, c 125, s 55 (1820), provided that the owner or master was not answerable for any default of any licensed pilot acting in charge of the ship under or in pursuance of any of the provisions of the Act. The exemption was based on the pilot being licensed, not on his being taken under compulsion: see Lucey v Ingram (1840) 6 M & W 302; 151 ER 424. (See also for the preceding statute, the General Pilotage Act (1812) 52 Geo III c 39, s 30.) 42 Subsequently, the Merchant Shipping Act 1854 (17 & 18 Vict c 104) (the "MSA 1854") provided in Part V for pilotage. It recognised local Acts and pilotage authorities created thereunder. It dealt with powers of pilotage authorities, including the setting of qualifications for and licensing of pilots and the fixing of pilotage rates (ss 331-336), returns by pilotage authorities (ss 337-339), the licensing of masters and mates as pilots (ss 340-344), pilot licences (ss 349-352), compulsory pilotage (ss 353-355), rights, privileges and remuneration of pilots (ss 356-364), offences of pilots (ss 365-367) and the saving of owners' and masters' rights (s 388). Section 388 of the MSA 1854 set out the defence of compulsory pilotage by requiring both compulsion and the relevant qualification of the pilot, as follows: An owner of or master of a ship shall not be answerable to any person whatever for any loss or damage occasioned by the fault or incapacity of any qualified pilot acting in charge of that ship within any district where the employment of such pilot is compulsory by law. The MSA 1854 defined "pilot" and "qualified pilot" as follows: "Pilot" shall mean any person not belonging to a ship who has the conduct thereof

"Qualified pilot" shall mean any person duly licensed by any pilotage authority to conduct ships to which he does not belong 43 Section 633 of the Merchant Shipping Act 1894(57 & 58 Vict, c 60) (the "MSA 1894") was in identical terms to s 388 of the MSA 1854. 44 The various British statutes of the 19th century were discussed by Lord Romilly MR in The 'Lion' (1869) LR 2 PC 525. In doing so, he pointed out the narrowing of the owner's compulsory pilotage defence under s 388 of the MSA 1854 to circumstances where a licensed pilot was compulsorily engaged, in contrast to s 55 of the General Act which had required only that the pilot be licensed for the defence of pilotage to be made good. 45 Thus, central to the approach of the general law, both to the responsibility of the shipowner, and his relationship with the pilot, were the notions of voluntariness and compulsion. If the pilot was voluntarily engaged, he was to be regarded as taken on as a servant of the owners. If compulsorily engaged, he was not. The relevant statutes (such as s 55 of the General Act, s 388 of the MSA 1854 and s 633 of the MSA 1894) provided for an additional requirement - due licensing for the defence to be available. That, however, did not affect the underlying importance at general law of voluntariness and its consequence upon how the pilot was treated as incorporated in the crew, as a servant of the owner. The element of compulsion (alone at general law) and in addition the requirement of due licensing (under statute) provided circumstances for protection of the owner from what would otherwise be his legal responsibility for the fault of the pilot based on the relationship of master and servant. The satisfaction of any exception did not otherwise affect the position should the exception not apply - that is voluntary pilotage, and the relationship of master and servant arising thereupon. The central element of compulsion and, in its absence, the relationship of master and servant (irrespective of any issue of licensing or qualification) can be seen from what Dr Lushington said in The 'Maria' at 107-108 (513): If the taking a pilot on board was compulsory, and the collision was occasioned by the fault of that pilot, I shall hold the owners of the "Maria" exempt from responsibility, upon general principle without reference to Acts of Parliament, for in that case the … pilot was not their servant, and the maxim qui facit per alium facit per se, does not apply. If, on the contrary, the taking a pilot was voluntary, then he was the servant of the owners, and the owners are responsible, unless the General Pilot Act, which takes away responsibility, applies to a foreign vessel so circumstances, and to cases where it is optional to take a pilot or not. 46 It was repeated by Dr Lushington in The 'Annapolis' at 312 (137): …But whether the Merchant Shipping Act applies to this case or not, I am of opinion that the owners of the "Annapolis" are exempt from responsibility by reason that the employment of the pilot was compulsory: the pilot was not their servant or agent; they could not avoid entrusting him with the management of the vessel. In the case of The "Maria"…, I have stated at some length my reasons for coming to this conclusion. I believe that the doctrine I then maintained, and now adhere to, is consonant with justice, supported by authority, and is in strict accordance with the principle adopted by the Legislature in the Merchant Shipping Act. I therefore pronounce against the claim brought by the owners of the "Johanna Stoll." 47 That the relationship of owner to pilot was that of master and servant was made clear in The 'Beechgrove' [1916] 1 AC 364. There, a pilot was taken on board one ship off the mouth of the River Clyde outside the compulsory pilotage area, for the inward voyage. The other ship had taken on board a pilot within the River Clyde for the outward voyage. The collision occurred outside the geographical bounds of the compulsory pilotage area while the pilots were in charge of the ships. The House of Lords was clear that the compulsory pilotage defence was unavailable. Lord Atkinson said at 382-83 and 390: It was held in The Maria that s 55 of the 6 Geo. 4, c 125 which is somewhat similar to s 633 of the Act of 1894, embodied this principle of the common law, that the doctrine of "respondeat superior" cannot apply when the law compels an owner to put and keep in charge of his ship for the purpose of navigating her a person he cannot himself select, and of whose skill and competence he may know nothing. As long as the statutory compulsion operates the person in charge of the ship is not the owner's servant, and the owner is therefore not responsible for his acts. Thus at common law the basis of the owner's immunity is the legal compulsion upon him. These two must synchronize in their operation, and are coterminous in their reach. When and where compulsion ceases, immunity ceases, and no agreement, express or implied which the owner or his agent, the master, may make with the pilot can, I think, at common law prolong or renew, as regards third parties, the one or the other. If the owner or his agent, the master, should request or permit the pilot to continue in command of the ship beyond the time he is bound by law to permit him so to do, then the relation between the owner and pilot becomes at common law a contractual relation of service, to which the maxim of "respondeat superior" directly applies. … Nor do I find anything inconsistent with the conclusion that in such a case, from the time the ship passed out of the compulsory area, the pilot was no longer a compulsory pilot, but stood to the master and the owners of the ship merely in the relation in which a pilot hired in a non-compulsory area stands to them. [emphasis added] 48 In The 'Eden' Dr Lushington made clear that the central consideration concerning the liability of owners for damage caused by the ship through faulty navigation of a pilot on board was whether the pilot was there by compulsion or by voluntary engagement. It was insufficient that the pilot was licensed. He must be compulsorily engaged. In The 'Eden' the pilot was licensed, but was not on board by compulsion. 49 All the above cases dealt with the liability of the shipowner for the fault of the pilot. Section 388 of the MSA 1854 and s 633 of the MSA 1894 used the word "answerable". That word was construed more widely than operating by way of mere defence: The 'Adam W Spies' (1901) 70 LJ (P) 25. There, Jeune P said, at 26, that s 633 operated not only as a defence to a claim against the owners, but permitted the owners to sue for the damage to their ship unhindered by any assertion of contributory negligence on their part through the default of the pilot. Comments made by Brett MR in The 'Hector' (1883) 8 PD 218 at 225 were to the same effect. 50 Claims by shipowners against harbour authorities appear to have been rare. Sir William Scott in The 'Neptune the Second' at 437 (1380-81), in a passage relied upon by Dr Lushington in The 'Maria', said the following about the possible liability of the pilot to the shipowner: The parties who suffer are entitled to have their remedy against the vessel that occasioned the damage, and are not under the necessity of looking to the pilot, from whom redress is not always to be had, for compensation. The owners are responsible to the injured party for the acts of the pilot, and they must be left to recover the amount as well as they can against him. It cannot be maintained that the circumstances of having a pilot on board, and acting in conformity to his direction, can operate as a discharge of responsibility of the owners. [emphasis added] 51 Marsden Collisions at Sea (6th Ed 1910) noted that attempts had been made to make pilotage authorities liable for the default of pilots: at pp 93-4 and 215, where reference was made to Dudman v Brown and Dublin Port and Docks Board (1873) IR Rep 7 CL 518; Shaw, Savill & Albion Co v Timaru Harbour Board (1890) 15 App Cas 429; Holman v Irvine Harbour Trustees (1877) 4 Ct of Sess Cas 4th Ser 406; and Parker v North British Rail Co (1898) 25 Ct of Sess Cas, 4th Ser 1059. 52 In Dudman, the owners of a ship sued the defendant port and docks board for the negligence of the licensed pilot whom owners had taken on board under compulsory pilotage. The pilot, being compulsory, was found not to be the servant of the plaintiff shipowner, thus the owner was not disentitled to sue by contributory negligence (that is by the negligence of the pilot). The assertion that the licensed pilot was the servant of the defendant was simply described as "untenable". 53 In Shaw, Savill & Albion the shipowner sued the harbour authority for the negligence and default of their servant who was the deputy harbour master and pilot and who was in charge of the ship when she and her cargo were lost. The loss was caused by his negligence. The authority's only duty was held to be to licence the pilot. Upon a reading of the relevant statute the harbour board was not authorised to enter into a pilotage contract or to employ someone as a pilot for a vessel. Thus, it was not liable. 54 Holman v Irvine Harbour Trustees is a case at the centre of Braverus' arguments. It was said by Braverus to demonstrate that a harbour authority is responsible as employer for an unlicensed pilot in circumstances where pilotage is not compulsory and that whenever the pilot was unlicensed the usual consequence of voluntary pilotage that the pilot was the servant of the shipowner did not obtain. The primary judge is said to have failed to appreciate the case's central importance. It is therefore necessary to examine it with some care. The pursuers sought to recover for damage to their ship which, while in the charge of one M'Gill who had been sent out by the harbour trustees to bring the vessel into harbour, struck a perch marking the entrance to the harbour. M'Gill was not a "qualified pilot" within the meaning of that phrase in the MSA 1854. He was called a "hobbler", who was paid weekly wages by the trustees and who was under the orders of the trustees' harbour master. His duties were principally berthing and mooring of ships within the harbour. The trustees were a pilotage authority under the MSA 1854, but they had not taken steps to licence pilots under Part V of the MSA 1854. M'Gill and other hobblers were employed in piloting ships into the harbour, when required. The trustees received the pilotage dues and applied them for harbour purposes. The harbour was not a compulsory pilotage area. The Lord Ordinary found (see 408-409) that the trustees had not undertaken and contracted to bring the vessel in safely, but that they had only undertaken to give the services of one whom they believed to be duly qualified. The Court of Session disagreed. Lord Ormidale rejected the plea that M'Gill was a "qualified pilot" under the MSA 1854. He concluded that M'Gill was acting as the servant of the trustees in the character of a hobbler rather than a pilot, saying of the trustees and M'Gill at 415-416: [A]ll they could say was, what their harbour-master stated when examined as a witness, that M'Gill was engaged, without inquiry or examination as to his qualifications or experience, as a man-of-all-work about the harbour, that his proper character was that of hobbler rather than pilot, and that the defenders just employed him and his two comrades "as their servants at weekly wages." But if such is the true position of M'Gill - if the relation between him and the defenders is that of master and servant - I must own my inability to understand how the usual consequences and responsibilities resulting from that relation should not in the present instance be held to follow. Not only was M'Gill the defenders' servant, but he was acting and paid by them as such on the occasion and at the time when, by his fault, the pursuers' ship was injured. The maxim qui facit per alium facit per se clearly therefore applies , and the fault of M'Gill, the defenders' servant, must be held to be the defenders' own. … [T]he pursuers desired to have a pilot; the defenders sent out, not a licensed or duly qualified pilot, as I think the pursuers were entitled to expect and were ready to pay for, but one of their own servants or hobblers working about the harbour on a wage of 21s. a week; and that man, acting under the defender's authority and instructions, took the command of the pursuers' ship, and by his faulty guidance of her caused the loss and damages now sued for. [Emphasis added] 55 It was at this point that Lord Ormidale spoke in terms of the trustees' undertaking and the significance of licensing as follows at 416-417: It is in these circumstances, that, in my opinion, the defenders' liability has been made out. The defenders undertook to bring the pursuers' ship safely into the harbour of Irvine, but in place of doing so she was seriously injured through the fault of their servant acting under their instructions. The Lord Ordinary has come to the conclusion that no liability has been established on the assumption that the defenders are in an equally favourable position as if M'Gill had been a duly qualified or licensed pilot. It is here I feel myself, with much deference, obliged to differ from the Lord Ordinary. A duly qualified or licensed pilot is a public officer who obtains his certificate only after a careful examination of his qualifications by parties competent to judge of them. On being licensed he occupies an independent position, very much as a notary public or messenger-at-arms does. The public constitute his master, and he is the servant of the public, like these and other public functionaries; and the usual consequences and responsibilities arising from the ordinary relation of master and servant do not arise. It was for this reason - a reason which has no application to the circumstances of the present case - that the harbour and pilotage authorities were assoilzied from liability in the case of Ogilvie and Others v The Magistrates of Edinburgh relied on so much by the Lord Ordinary. The action in that case appears to have been laid upon the allegation that the pilot whose fault was there in question was appointed by the defenders, the Magistrates of Edinburgh, and it was not said that there was any irregularity or illegality in the appointment. But in sending M'Gill in the present case to take command of the pursuers' ship the defenders sent a man who had never been licensed as a pilot at all, and who occupied merely the position of one of their servants working about the harbour; and in so sending that man the defenders contravened their own bye-laws, and especially the first of that branch of them titled "Regulations for pilots at the Harbour of Irvine," which is in these terms - "That no person shall act as a pilot for or on board of any vessel trading to or from the harbour of Irvine without being first duly licensed by the harbour trustees, and that under a penalty not exceeding Ł5 sterling for each offence besides all damages and expenses that may be incurred, and every pilot shall upon his appointment find caution for his good behaviour and faithful discharge of his duties." But M'Gill had no license, and he never found caution for his good behaviour and the faithful discharge of his duties. [emphasis added] 56 Lord Gifford said at 417: The short ground upon which I rest my opinion may be stated almost in a single sentence. I think, upon the evidence, and looking to the whole circumstances of the case, including the terms of the various statutes under which the harbour trustees acted, that Jeremiah M'Gill, on the occasion in question, was not acting as an independent pilot employed by the shipmaster or captain of the "Gertrude," and merely licensed or authorised by the defenders, but was acting solely and simply as the servant of the defenders, employed by them alone, and paid by them alone, and acting within the limits of the defenders' harbour in discharging a duty which the defenders themselves had undertaken to perform. Now, if this be so, I can see no reason for departing from the general rule which makes a master who undertakes any piece of work liable for the fault or negligence of any servant or workman whom he directs to carry out the operations which he, the master, has undertaken. In short, a person who undertakes to do any piece of work by means of a subordinate employed by him is liable for the fault or negligence of the subordinate just as if he had been acting himself. [emphasis added] 57 Lord Gifford also construed the relevant Act governing the trustees as providing for the trustees undertaking to provide pilotage. 58 Lord Gifford contemplated, however, that the shipowners may have been liable for the negligence of M'Gill vis-ŕ-vis third parties as their servant. At 421 he said: Difficult questions might arise if M'Gill, in the course of piloting the defenders' ship, had by his fault or negligence occasioned injury to third parties, for example, to other ships in the harbour, or to members of the public, and it is possible that in a question with such third parties he might have been held the servant of the "Gertrude" or of her owners. No such question arises here, and it is enough for the decision of the present case that as in a question between the pursuers and defenders M'Gill was acting solely as the servant of the harbour trustees. (As the primary judge noted, the reference to "defenders'" in the first sentence should read "pursuers'".) 59 The Lord Justice-Clerk agreed and made two points in particular. First, he said that the trustees had contractually agreed to pilot the vessel into the harbour safely. At 421 he said: First, I am of opinion that the Irvine Harbour Trustees undertook the duty of piloting this vessel into the harbour of Irvine, in consideration of certain payments to be made by the vessel using the harbour, which are directed by their own local statute to be applied for harbour purposes, that is to say, the relation between this vessel the "Gertrude" and the harbour commissioners was one of contract, under which the vessel was bound to pay pilotage dues, and the commissioners in return undertook the safe pilotage of the vessel. Now, when two parties enter into an onerous contract, whereby one agrees to pay and the other to perform, it is the duty of the latter to perform that for which the payment is made with care and skill, and if the duty be negligently performed by the parting contracting or those employed by him, liability will attach to him for the consequences. [emphasis added] 60 Secondly, the Lord Justice-Clerk said that the lack of licence of M'Gill was important. At 422 he said: …No doubt, if the harbour commissioners had sent out a licensed pilot they would have done all that could have been required of them, for it is certain that a pilotage authority, having duly licensed a pilot, is not responsible for any fault he may commit. The licensing of a pilot is the appointment of a public officer, and the supplying of a licensed pilot to pilot a vessel is the due performance of the obligations under which the harbour commissioners lie. It is not a sufficient performance of that obligation, first to neglect the duty of licensing pilots, and then to send out a man who, however, qualified he may be, is not in the position of a public officer. 61 As the primary judge pointed out, all three members of the Court were of the view that the trustees had undertaken or contracted to pilot the ship safely into harbour. The neglect of their servant was seen as the means of the breach of that understanding or contract. The relationship of that contractual responsibility, on the facts, with what was stated would have been the position of the trustees had M'Gill been licensed is not entirely clear. If the trustees had undertaken licensing of pilots not only of M'Gill, but of others, under the MSA 1854,the contractual and legal framework would, it would seem, have been different and more likely to have been in accordance with the undertaking found by the Lord Ordinary. The lack of a licence and the performance of the work by M'Gill as servant of the trustees, rather than in this character of a pilot independently retained, was also important. 62 None of their Lordships, however, dealt with the position of pilots voluntarily retained under general law or the cases dealing with that issue. These cases appear to have been cited in argument only indirectly at 413 of the report by the references to Story J, Commentaries on Agency (1851 ed) at [456], Maclachlan on Shipping (2nd ed) p 267 (not it should be noted 265), Shearman T and Redfield A, A Treatise on the Law of Negligence (2nd Ed) and General Steam Navigation Company v British Colonial Steam Navigation Company (1869) LR 4 Ex 238. The propositions put by counsel for the trustees set out at 413 do not squarely raise the position of the pilot voluntarily engaged. None of the judgments of their Lordships in Holman stands as authority for the proposition that absent an undertaking or contract by the trustees, the lack of licence in M'Gill (however that may have arisen) necessarily made the trustees liable for his fault. None of the judgments of their Lordships stands for the proposition that any defect whatever in the licensing of a pilot - irrespective of the skill and competence of that pilot - has the result that in the context of voluntary pilotage the pilot remains the servant of the port authority and does not become the servant of the shipowner as part of the ship's complement. One issue not dealt with, which may have affected the relevance of these cases on voluntary pilotage, was whether there was any voluntary engagement of M'Gill as a pilot, in circumstances where there was a contractual undertaking with the trustees. 63 It will be necessary to return to Holman in the context of s 410B of the Navigation Act. For now, it is sufficient to appreciate that the asserted responsibility of the Corporation to Braverus is to be assessed in the context of s 410B, and not, as in Holman, in its absence. 64 Parker v North British Rail Co was also referred to by Marsden. It was a case concerning a harbour-master taking charge of a vessel on which there was a duly licensed pilot. No detailed discussion of the case is necessary for present purposes. 65 In circumstances where the pilot was duly licensed and qualified and fulfilling a public duty, a harbour authority, even though the general employer of the pilot, was not liable for his neglect. In Fowles v The Eastern and Australian Steamship Company Ltd (1913) 17 CLR 149, the owners of a vessel which had been stranded in the port of Brisbane while in the charge of a licensed pilot sued the Queensland Government. Pilotage was compulsory. The pilotage service was under the general control of the Queensland government. Pilots were appointed by the government and licensed by the Marine Board. Moneys received for their services were paid into Consolidated Revenue. Pilots were paid a fixed salary. Barton ACJ and Powers J were of the view that the government would be liable for the negligence of its servant. Isaacs J held that the duty of the government was to see that a qualified pilot was appointed. The Privy Council on appeal from the Supreme Court after the trial ([1916] 2 AC 556) agreed with Isaacs J and rejected any liability of the government. There was no contract. The duty of the government was not to pilot the ship but to provide a skilled pilot to do so. Their Lordships said at 562-63: [B]ut if the question be, as their Lordships think it is, whether or not the defendants were bound to navigate this ship and employed Maxwell to do for them the work which they were bound to do, then it is not conclusive to say that he was in their service unless it can also be said that the Government were "the principals in the piloting of ships," to borrow the happy phrase of Isaacs J. That phrase seems to hit the point exactly. If Maxwell himself was the principal in the piloting of ships, then the defendants cannot be liable. It was he and not they who owed the duty of careful piloting to the plaintiffs. In their Lordships' opinion these Acts of Parliament did not alter the original status of a pilot, which is, in effect, that he must be regarded as an independent professional man in discharging his skilled duties. If it had been intended to alter this old and familiar status, it is to be supposed that the Legislature would have done it more explicitly. What it has done is more consistent with a different and limited purpose, namely, to secure a proper selection, a proper supply, a proper supervision, and a proper remuneration of men to whose skill life and property is committed, whether the ship-owner likes it or not. For this purpose they become servants of the Government. For the purpose of navigating ships they remain what they were, and the duty which the State or Government owes to a shipowner, exercised, it is true, by various authorities, is to provide a qualified man in the terms of the statutes, but not to take the conduct or management of the ship. It is not said that they have failed in this duty of providing a qualified man. [emphasis added] 66 As Gibbs CJ said in Oceanic at 637, Fowles has been understood in the High Court as depending on the circumstance that the pilot was executing an independent duty which the law cast on him. 67 Prior to the first decade of the 20th century, the issue of the respective responsibilities of the master (as servant of the owner) and the pilot had generally arisen in circumstances where the possibility of sole fault in the pilot might absolve the owner. The importance of compulsion to the defence of the owner was bound up in the pilot's role. This relationship was exhibited in The 'Guy Mannering' (1882) 7 PD 132, where Brett LJ said at 134: …In England the shipowner is not liable for the acts of the pilot, where pilotage is compulsory: the statutes as to merchant shipping do not accurately define the duty of a pilot; but it is plain that he is to conduct the navigation. On the one hand he has no power to place the crew at particular posts in the ship or to regulate the discipline: on the other hand he is to regulate the course of the ship through the water; he is taken on board in order to control the management of her for this purpose: a sailing vessel cannot be steered unless her sails are regulated in a particular manner; and therefore he has power to regulate the management of the sails. The owner of the ship is not liable for the consequences of the wrongful or negligent acts committed by the pilot, whom he is compelled to employ. Cotton LJ said at 135-36: …By the English law, the owner of a ship is not liable for the negligence of a pilot whom he is compelled to employ; and the reason is that the pilot is not the servant of the owner. In some of the sections of Part 5 of the Merchant Shipping Act, 1854, such as ss 359, 362, 388, a pilot is said to "have charge" or to "take charge", or to "acting in charge;" this language seems to shew that in the opinion of the legislature, when a pilot comes on board, he takes the management of the vessel; in fact, the management of the vessel passes out of the hands of the captain; and therefore it is only reasonable that when pilotage is compulsory, the owner should not be liable for the negligence of the pilot. 68 In The 'Guy Mannering' these principles did not avail the owners in respect of a collision in the Suez Canal with a compulsory pilot on board, because the local law was clear that though the pilot was compulsory, he did not have charge or control of the vessel. He was to be seen only as a compulsory adviser. 69 At [336] to [350] of his reasons the primary judge gave a clear enunciation of the respective duties of pilot and master, based on the leading texts and the authorities of the day up to the International Convention for the Unification of Certain Rules of Law Respecting Collisions between Vessels done at Brussels on 23 September 1910 (the "1910 Convention"). We gratefully accept and adopt his Honour's careful analysis. It is part of the general law context for understanding the provisions of the Navigation Act which were the antecedents of s 410B and the cognate United Kingdom provision in the Pilotage Act 1913 (Imp). For present purposes, it is sufficient to recognise that, as a general rule in matters of navigation, the pilot's authority superseded that of the master. The courts also recognised the necessity of the master being able, and indeed bound on some occasions, to intervene in appropriate circumstances. The primary judge carefully outlined the existing law by the early 20th century in this regard. It is important, however, to understand that the nature and content of the legal relationship between the master and pilot remained the subject of differing views at this time. This was revealed in the report of a Departmental Committee of the Board of Trade which had been set up in 1909 to enquire into the law of pilotage. The Committee's report was published in 1911. The Departmental Committee reported upon a legal situation that was seen as less than clear. The existing law of general and specific Acts and the absence of any definite principle governing pilotage legislation was said to be "chaotic". As the primary judge said at [353] of his reasons, evidence taken by the Committee as to the relationship between master and pilot was divided about the nature of the relationship. Douglas & Geen state the following at [19.23]: The legal relationship between master and pilot was the subject of considerable discussion by the committee and the opinion of those who gave evidence was clearly divided. Lord Gorell, a former President of the Probate, Divorce, and Admiralty Division of the High Court, was of the opinion that "no-one unaccustomed to a particular ship can handle her as her master and officers can", while Sir Kenneth Anderson, Chairman of the Orient Steam Navigation Company, said that "it is obviously better that the actual giving of orders should rest with the man who has the knowledge than with the man who seeks advice". One shipmasters' organization said that "in a district where pilotage is compulsory, the pilot should have sole and complete charge of the ship", while another said that "under no circumstances should a master give up charge of his ship or the control of his crew". Pilots, understandably, were almost unanimous in the view that the pilot should have complete control. A typical view was expressed by the Manchester pilots who said that the pilot's authority "should be absolute in the control of the ship while within his jurisdiction". Having weighed all the evidence the committee recommended that there should be an express provision in the new pilotage legislation that the pilot should be given a subordinate role. [footnotes omitted] 70 Also, by 1912, the 1910 Convention had been agreed to. By Article V thereof, Contracting States had agreed that the liability imposed by Articles I-IV for collisions would attach in cases of compulsory pilotage. Thus the defence of compulsory pilotage was agreed to be removed.

The legislative response in the United Kingdom and Australia

71 In response to the international obligations created by the 1910 Convention the United Kingdom repealed s 633 of the MSA 1894 which ceased to have effect on 1 January 1918 when s 15(1) of the Pilotage Act 1913 (Imp) took effect. This provided in terms as follows (being substantially identical to the current s 410B(2) of the Navigation Act): Notwithstanding anything in any public or local Act, the owner or master of a vessel navigating under circumstances in which pilotage is compulsory shall be answerable for any loss or damage caused by the vessel or by any fault of the navigation of the vessel in the same manner as he would if pilotage were not compulsory. 72 The provision remained in these terms until the introduction of s 16 of the Pilotage Act 1987 (UK). 73 The Commonwealth Parliament also removed the defence of compulsory pilotage by enacting ss 351 and 352 of the Navigation Act, though in somewhat different terms to s 15(1) of the Pilotage Act. Sections 351 and 352 originally provided as follows: 351(1) The duty of a pilot shall be to pilot the ship subject to the authority of the master, but the master shall not be relieved, by reason of the ship being under pilotage, from responsibility for the conduct and navigation of the ship. 351(2) The owner or master of a ship shall not be exempt from liability for any loss or damage occasioned by the fault or want of capacity of a pilot by reason of the fact that the employment of the pilot is compulsory. 352(1) An unauthorized person may take charge of a ship as pilot - (a) when the master has used all reasonable means to obtain an authorized pilot, but no authorized pilot is available; or

(b) when the ship is in such circumstances as to make it necessary for her safety that she should be brought into port at once. (2)In any such case, so soon as an authorized pilot presents himself, the master shall cause charge of the ship to be at once given up to him. Penalty: Fifty pounds. (3)Except as allowed by this section, no unauthorized person shall act as pilot. Penalty: One hundred pounds. 74 'Pilot' was defined in s 6 so as to mean: any person appointedor licensed as suchunder the Act, and not belonging to a ship, who had the conduct thereof. 75 The primary judge referred at [356] of his reasons to the exchanges in the Commonwealth Parliament as to the clauses which became ss 351 and 352 of the Navigation Act. The Attorney-General (Mr Hughes, who had been the Chairman of the Royal Commission on the Navigation Bill presented to the Commonwealth Parliament in 1906) in Committee on 17 and 22 October 1912 (see House of Representatives Debates 17 and 22 October pp 4357 and 4481-82) made clear his view that the current state of the law regarding the relationship of owner to pilot was unsatisfactory. He said that there was a perceived lack of clarity of responsibility (he referred to the Departmental Committee Report and the search for uniformity in the 1910 Convention). He expressed the view that the clear statement of the authority of the master (in cl 351(1)) was a change to the law and was harmonious with the responsibility placed on the owners in circumstances of compulsory pilotage by cl 351(2). 76 At [357]-[361] of his reasons, the primary judge outlined the course of the Navigation Act provisions up to the current form of s 410B. The form of s 410B(2) appears to have been adopted in 1934 (as s 351(2)) and was based on s 15(1) of the Pilotage Act. 77 As has been noted, in the original Navigation Act the word "pilot" was defined as a person licensed under that Act. In 1934 a subsection (3) was inserted into s 351 defining "pilot" as follows: For the purposes of this section "pilot" includes any pilot employed or licensed by any State Government, Marine Board or other State authority to pilot ships in any port or district in which the employment of a pilot is compulsory. [emphasis added] 78 In the Navigation Act 1958 (Cth), the word "pilot" was defined (as it is now) as meaning a person who does not belong to, but has the conduct of a ship, without reference to licensing. The explanatory notes to the Navigation Bill 1958 provide the following commentary on the change to be wrought by the Bill in the definition of "pilot": The present definition means only a pilot appointed or licensed under the Act. There are no such pilots, because pilotage remains a function of the States. The new definition therefore is limited to the normal meaning of the term, ie. a person not belonging to a ship, but having the conduct of it. 79 In the Senate, in committee, the Minister for Shipping and Transport was asked why the Bill contained no reference to pilots in contrast to the provisions of the existing Act to which he replied (reflecting what is contained in the Explanatory Notes): It has been removed altogether. When the principal Act was originally enacted, it was assumed that pilots and piloting would be the business of the Commonwealth. In point of fact, that assumption has not been borne out. 80 In none of the versions of the Navigation Act was the word "pilotage" defined. 81 At [362] to [377] of his reasons, the primary judge discussed the impact of the statutory regime put in place after the 1910 Convention and whether it affected the respective responsibilities of the master and pilot as they had been explained in the cases before 1910. The context of this discussion was the assessment of the duty upon Capt Krol and whether he had breached it. (No question of this breach of duty was argued on the appeal.) Nevertheless, we agree with his Honour's analysis. It is of some remaining relevance, because of its relationship to an understanding of ss 351 and 352 and then s 410B of the Navigation Act.

The jurisprudence on s 15(1) of the Pilotage Act and s 410B of the Navigation Act

82 Sections 15(1) of the Pilotage Act and 410B(2) of the Navigation Act have been the subject of considered views of the Court of Session in Scotland, the House of Lords (twice) and the High Court. Each of these cases, in one way or another, treated the effect of s 15(1) or s 410B(2) as making, for all purposes, the pilot the servant of the shipowner. In each case, the legal relationship of the owner and pilot was to be predicated upon that statutorily mandated foundation. 83 At this point, it is important to recall the point made earlier that the issue may be approached by reference to two questions: the application of the provision, in particular in the circumstances of the pilot being unlicensed, and if the provision applies, the extent of its operation. All the cases about to be discussed deal with the second of these questions, not the first. In none of the cases about to be discussed was the pilot unlicensed. The answer to the first question depends on the proper construction and interpretation of s 410B(2) and whether it applies to the circumstances of the pilot not being licensed. It is necessary, however, in the light of some of the submissions of Braverus as to the limits of the operation of s 410B(2), based on the judgment of Brennan J in Oceanic and the jealous construction of immunities called for by Puntoriero v Water Administration Ministerial Corporation (1999) 199 CLR 575 to examine each of these cases to appreciate the width that has been given to s 15(1) of the Pilotage Act and s 410B(2) of the Navigation Act. 84 In Thom v J & P Hutchison Ltd 1925 SC 386, the Court of Session dealt with s 15 of the Pilotage Act. The widow of an engineer killed aboard the steamship Smerdis sued the owners alleging that he had been killed by the fault of the pilot navigating the ship in the Mersey where pilotage was compulsory. Smerdis struck the anchor chain of a vessel moored in the river, was holed, took on water and went down, ten of the crew perishing, including the engineer. The owners defeated the widow's claim by the Scottish equivalent of the doctrine of common employment - the pilot was treated as a servant of the owner. The argument that the relationship of owner and pilot voluntarily engaged was that of agency was rejected. Lord President Clyde at 392-3 said that a voluntarily engaged pilot was a constituent member of the ship's company under service, not agency. This voluntary relationship of service gave the owner power to direct and control the manner in which the pilot exercised his duties. The Lord President stated the matter in categorical terms at 392-93 as follows: The point mainly relied on by the pursuers was the absence of power, on the part of the owners of the ship, to direct and control the manner in which the pilot exercised his duties. But, if the employment is voluntary, I see no more reasons to doubt the right of the employer to do so - however foolish it might be for him to attempt it - in the case of the pilot than in the case of the captain. It is no doubt true that the highly skilled nature of the work to be done and the remoteness of the ship from her owners make actual direction and control practically impossible in either case. But it is now for the first time suggested that the legal relation between a seaman and the owner of the vessel on which he serves is other than that of master and servant; and - though I rather think it is true that there is no case in which the true nature of the legal relation of a pilot (voluntarily engaged) to the owners has been canvassed - it has never been doubted throughout a long series of cases that it is that of service. The earliest quoted to us was that of The "Maria" - 1 W. Rob 95 per Dr Lushington, at pp 107, 108. Lord Chelmsford evidently treated the point as one not open to doubt in Prowse v European and American Steam Shipping Co. - 13 Moo P. C. 484, see at the end of the judgment. And the same understanding clearly underlies the reasoning in one of the latest cases - Steamship "Beechgrove" v Atkieselskabet "Fjord," 1916 S.C (H.L.) 1, [1916] 1 A. C. 364. It is unnecessary to make a larger citation. … The pursuers, indeed, argued, with a somewhat subtle ingenuity, that while (under section 15 of the 1913 Act) the owners of the ship in the present case must be deemed (contrary to the fact) to be the voluntary masters of the pilot as their servant, to the effect of establishing liability on the owners for the negligence of the pilot, there was nothing in the section requiring or warranting that the members of the crew must be deemed (contrary to the fact) to be the fellow servants of the pilot, to the effect of depriving them of the right to enforce the owners' liability to them. But it is, I think, a sufficient answer to say that the liability artificially made to rest on the owners must be taken with all the legal qualifications attaching to it, and the defence of collaborateur is one of them. [emphasis added] 85 The Lord President referred to The 'Maria' to which we have referred. The reference by the Lord President in the same passage to Lord Chelmsford in Prowse v European and American Steam Shipping Co (1860) 13 Moore 484; 15 ER 182 was a reference to the appeal from Dr Lushington in The 'Peerless'. There, Lord Chelmsford, said the following at 509 (191): The third question being thus determined upon the Act, and the rules and regulations, it is unnecessary to consider the general principles on which the right of exemption was also founded, because if the parties were not compelled to take a Pilot the whole foundation of this part of the argument fails, and there is no ground whatever for saying that the owners are exempt from the ordinary liability which attaches upon them for the negligence of their servants. [emphasis added] 86 In Thom, Lord Cullen was also clear as to the position of master and servant. At 393-94 he said: Now, it is well settled that an owner is liable for loss or damage caused by fault in navigation on the part of a pilot voluntarily employed by him. And the ratio of this liability has always been stated to be that such a pilot is the servant of the owner. He is employed to take up pro tempore the captain's function of navigator in circumstances where special local knowledge is required. It is true that he is not a kind of servant of whom it can be said that he is bound to obey his employer's orders, not only as to work to be done, but also as to how he shall do it. But the same thing applies to the captain. If the compulsory pilot is to be regarded under this enactment as the servant of the owner, I agree with the Lord Ordinary's conclusion that the doctrine of colloborateur applies. It is well settled that a captain and members of his crew are collaborateurs, and I can see no difference in this respect between the case of the captain and that of the pilot. [emphasis added] 87 In Thom, Lord Sands expressed some reservations as to the result, but nevertheless agreed with the Lord President and Lord Cullen, saying at 394-395: Examination of the cases in which liability for negligence where the pilotage was voluntary has been affirmed shows that this conclusion is based upon the theory that liability results from the fact that a voluntary pilot is a servant of the shipowner. If you carry across this rule of liability to the compulsory area, you must carry with the rule the theory in which it originates, and accordingly the compulsory pilot becomes quoad hoc a notional servant. The actual servant, viz., the seaman, must be held to be a collaborateur with this notional servant, the compulsory pilot, and, accordingly, the shipowner avoids liability. I find these considerations somewhat perplexing, but I have come to be of opinion, particularly in view of the opinion of your Lordships, that I must have involved myself in this perplexity by introducing an unnecessary subtlety. When the pilotage is compulsory, the shipowner is to be liable in the sameway as he would be if pilotage were not compulsory. [first emphasis added, second emphasis original] 88 The scope of s 15(1) of the Pilotage Act was explored in Workington Harbour and Dock Board v Owners of 'Towerfield' [1949] P 10 (Court of Appeal) and[1951] AC 112 (House of Lords). In 1941, Towerfield grounded in the approaches to Workington harbour, while under pilotage, which was compulsory. The ship was damaged. The owners claimed against the Harbour Board based on negligence and on an alleged contract or warranty that the depth of the harbour was in accordance with an Admiralty chart, which was said to be based on a plan supplied by the Harbour Board. The Admiralty chart was misleading as to depth. The Harbour Board counter-claimed for damage to the harbour caused by the ship. Willmer J found the Harbour Board to be negligent, but that the grounding was caused solely by the pilot's negligence. He dismissed the plaintiffs' (owners') claims and gave judgment for the counter-claimants (Harbour Board) on the counterclaim. The Court of Appeal unanimously upheld the appeal on the counter-claim (thereby dismissing it) and by majority upheld the plaintiffs' appeal and found their claim succeeded. The counter-claim failed in the Court of Appeal because the Court of Appeal (contrary to Willmer J) was of the view that the negligence of the Harbour Board was causative, and that it was therefore guilty of contributory negligence. The Court of Appeal was, however, divided on the effect of the pilot's negligence on the plaintiffs' claim. 89 Bucknill LJ, after a comprehensive review of the relevant provisions concerning the shipowner's defence in respect of damage caused by the fault of pilots, the 1910 Convention and the case law came to the view that the word "answerable" in s 15 of Pilotage Act was intended to be as wide as it had been under the MSA 1894 and previous statutes in expressing the protection to the owner. It was intended, he said, to cover all claims both by and against persons in which the conduct of the compulsory pilot was a contributing cause. In removing entirely the defence of compulsory pilotage, and by using language of "answerability" previously used in the expression of the defence, s 15(1) put on the shipowner the same responsibility for the acts of a compulsory pilot as he had always had for the acts of a voluntary pilot, namely a contractual relation of service, to which the maxim respondeat superior applied: see [1949] P at 22-28. The claim in tort thereby failed by reason of the contributory negligence of the pilot. Bucknill LJ rejected the plaintiffs' claim in contract, because he found an implication in the posited contract that the plaintiffs would use reasonable care and skill in navigating the channel. They had not done so, by reason of the pilot's negligence attributed to them. 90 Scott and Asquith LJJ agreed with Bucknill LJ as to the plaintiffs' claim in tort, but said that s 15 should be limited to actions in tort, whether by way of defence or claim in tort. They said that its effect should not be extended to defeat the shipowner suing in contract. 91 In the House of Lords, the wider view of the operation of s 15 enunciated by Bucknill LJ was adopted. Lord Porter reached the same conclusion as Bucknill LJ but by reference only to the text of s 15(1). The word "answerable" meant "responsible" and at 133-134 he said: …when the Act says that the owner shall be answerable for that faulty navigation, it has to be determined whether "answerable" means more than that the damage, whether done to or done by his ship, is his responsibility or is confined to damage done by the ship. Either view no doubt is theoretically possible but I do not think that read in its context the use of the word "answerable" would naturally convey the suggestion that, though the shipowner is liable for any damage done by the pilot's fault, yet he can recover his own damage in full. "Answerable", as I think, simply means responsible, and a shipowner who through a compulsory pilot is responsible for faulty navigation is responsible for damage to his own ship as well as for injury to the property of another. … …The provisions of the Act, as I think, themselves plainly attribute to shipowners liability for the fault of a compulsory pilot in all cases and I can therefore see no reason for differentiating between contract and tort, more particularly as this appears to have been accepted as the correct view from the time when the Act came into force until the present day. [emphasis added] 92 Lord Normand (at 145), whilst saying that there was a clumsiness about the language of s 15, agreed with Thom and the reasoning therein, and with the reasoning of Bucknill LJ. Thus, his view was that the pilot was the servant of the owners and so in a tortious or contractual setting the fault of the pilot was the fault of the owners by vicarious liability. 93 Lord Oaksey (in dissent) agreed with the majority of the Court of Appeal. 94 Lord Morton of Henryton agreed that s 15 extended to actions in tort and contract. 95 Lord Radcliffe said at 156: …I can see no way of describing the pilot's navigation of this vessel as other then negligent, and think that s 15 of the Pilotage Act, 1913, must be construed so as to impute his negligence to the owners, even when they appear as plaintiffs seeking to recover damages for injury to their vessel. If so, their claim must fail, for their negligence was no inevitable consequence of any breach of duty that can be attributed to the harbour authority. … [emphasis added] 96 Thus, a majority of the House of Lords accepted (for slightly varying reasons) that the effect of s 15(1) of the Pilotage Act was to make the owners responsible, not only in damages to a third party, but also to prevent an action in tort or contract, at least if the negligence of a servant would otherwise see the claim defeated. 97 One then comes to Oceanic Crest Shipping Co v Pilbara Harbour Services Proprietary Limited (1986) 160 CLR 626. There, the shipowner (Oceanic) was held liable to the owner of a wharf, which had been damaged by the impact of the ship in question caused by the negligence of the pilot. The harbour was a compulsory pilotage area. The pilot, who was licensed, was in the general employment of the harbour authority (Pilbara). The shipowner was held responsible by reason of s 410B(2). The shipowner's claim against the harbour authority rested on the latter being vicariously liable for the default of the pilot. A majority of the High Court (Gibbs CJ, Wilson J and Dawson J) dismissed the claim and held that Pilbara (the general employer of the pilot) was not responsible for his negligence. The primary judge found, and the Corporation submitted on appeal, that each of the majority justices had two, distinct and separate, bases for his conclusion. The first basis was an application of the principle underlying Fowles - that the pilot was a public officer executing an independent duty which the law cast on him: see per Gibbs CJ at 635-640, per Wilson J at 647-650 and per Dawson J at 681-683. The second basis was the application of s 410B(2). 98 Here, of course, Capt James was not licensed. It was not argued by the Corporation on appeal that it could invoke Fowles or the principle underlying it. In any event, in this respect, any such argument of the Corporation would have to deal with the terms of s 7 of the LR(VL) Act. 99 It is necessary to examine what the majority said about s 410B(2). Gibbs CJ appeared to conclude his analysis of Fowles and its related principle at 640 at the end of the first full paragraph. The Chief Justice then analysed the position of the pilot at common law. In that analysis, the status of the voluntarily engaged pilot as servant was recognised. Reference was made to The 'Eden', The 'Maria', Townsville Harbour Board, The 'Beechgrove' and Thom. After referring to s 410B(2) and the dictum of Lord Porter in The 'Towerfield' at 134 (emphasised at [92] above), the Chief Justice said at 641: …This provision, [s 410B(2)] which was not in force at the time of the stranding which gave rise to Fowles v Eastern and Australian Steamship Co Ltd., provides an additional reason for concluding that, in the case of compulsory pilotage, the employer of a pilot is not responsible for his negligence. "The law does not recognise a several liability in two principals who are unconnected": Laugher v Pointer.… [emphasis added] 100 After referring to the criticism of the rule in Laugher v Pointer by Professor Atiyah, the Chief Justice referred to the cases of transfer of employees and the creation of an employment relationship with the borrowing employer if the relevant factual circumstances can be demonstrated to warrant such a conclusion: Mersey Docks and Harbour Board v Coggins and Griffith (Liverpool) Ltd [1947] AC 1 at 13. In that context Gibbs CJ said at 641: In the case of a pilot, s 410B(2) of the Navigation Act casts the liability directly on to the shipowner and in consequence excludes any liability of the general employer of the pilot. 101 This was a clear recognition by the Chief Justice that, on the existing authorities, the effect of s 410B(2) was to create a statutory relationship of master and servant (in a manner equivalent to employment pro hac vice), such that, for the purposes of the loss and damage caused by the fault of the navigation of the ship, the pilot was the employee of the shipowner and not of his general employer. Having clearly stated this "additional", and clearly separate, basis of liability based on s 410B(2), the Chief Justice then expressed some views (at 641-42) as to the reconciliation of this employment relationship between the shipowner and the pilot with the notion of the independent duty on the pilot. This discussion can be seen as based on the assumption that the pilot is licensed - the foundation for his independent duty the law casts on him. However, it was a discussion directed to the legitimacy of the rule in Fowles; it was not an explication of any further aspect of the contents of s 410B(2). This can be seen by the concluding sentence of the third last paragraph, and the second last paragraph, of the Chief Justice's reasons at 642. 102 Whilst, of course, the facts in Oceanic were that the pilot was licensed, there is nothing in the reasons of the Chief Justice to support the proposition that s 410B(2) does not, or cannot, apply to an unlicensed pilot. That is an anterior question of statutory interpretation. What the reasons of the Chief Justice reveal is that in circumstances of the application of s 410B(2) a statutorily based employment relationship is created, removing the responsibility (answerability) for the fault of the pilot from his or her general employer to the statutory particular employer, the ship owner, in a manner equivalent to that considered in Mersey Docks and Harbour Board (as to which, see Glass H, McHugh M and Douglas F The Liability of Employers (Law Book Co 2nd Ed ) pp 78-85). 103 Wilson J also based his conclusion of Pilbara's lack of responsibility on two bases: s 410B(2) and the principle in Fowles. His Honour dealt first with s 410B(2), drawing attention to the essential distinction in Admiralty between voluntary and compulsory engagement of pilots: see 643-44. After referring to Lord Atkinson in The 'Beechgrove', Wilson J said at 644: It is plain that the shipowner is liable for the negligence of a pilot voluntarily engaged because the relationship thus established is considered to be that of master and servant. … 104 His Honour then discussed the consideration of the principle in Thom, referring to the passage in the judgment of the Lord President cited at [85] above. At 645-46, Wilson J then made plain that the subjection of the owner to liability was grounded in the pilot being made the servant of the owner and under the authority of the master of the ship: There is no difficulty in reaching the conclusion that the owner of the ship is vicariously liable for the negligence of the pilot. The problem is to determine whether the scope of that liability leaves any room for a finding of vicarious liability in the pilotage authority, the general employer of the pilot. Sub-section (1) of s 410B confirms that the rationale for subjecting the owner of the ship to liability is grounded in the incorporation of the pilot into the shipowner's enterprise in the capacity of a servant. The pilot is declared to be subject to the authority, that is the control, of the master. Alternatively, the pilot's position may be described in the words used by the Lord President in Smerdis, namely, as "a constituent member for the time being of the organisation composed of the officers and crew". This is so whether the pilotage is voluntary or compulsory. Furthermore, the terms of subs (2) plainly impute the pilot's negligence to the shipowner in all cases where loss is caused through faulty navigation, leaving it responsible for damage to its own ship as well as for injury caused thereby to the property of another: Workington Harbour & Dock Board v Towerfield (Owners). 105 In the next paragraph on 646, Wilson J did say: One must have regard to the undisputed finding that Captain Hammonds was a competent pilot adequately qualified to be appointed as such. In the light of that finding, the only basis available to Oceanic in support of its claim is the proposition that Pilbara, as the employer of the pilot, was vicariously liable to Hamersley for his faulty navigation. However, that statement was not made as a limitation on, or qualification for, the operation of s 410B(2). It was part of the section of his Honour's judgment which discussed the independent basis for Pilbara's lack of responsibility - the rule in cases such as Fowles. Having already concluded that the owner was liable for the pilot's acts, Wilson J went on, at 646, to reinforce the consequence of the statutorily mandated employment relationship: But that liability cannot co-exist with an identical liability attaching to Oceanic. It is unnecessary to look for the exceptional circumstances that would, consistently with the views of the House of Lords in Mersey Docks and Harbour Board v Coggins and Griffith (Liverpool) Ltd., result in the transfer of the service and control of a servant from a general employer to a particular employer so as to attach vicarious liability for the servant's negligence to the latter. It is unnecessary because the statute has pre-empted the answer. It has declared in effect that when Captain Hammonds was bringing the "Oceanic Crest" into its berth in Dampier on 8 August 1978 he was subject to the authority of the master of the ship and in a master-servant relationship with its owner. That being so, we have a situation in which the biblical truth that "no man can serve two masters" may not be without relevance. 106 Dawson J also based his conclusion on both s 410B(2) and Fowles. It is clear, at 680-81, that the two bases are distinct. The reasons for his Honour's conclusion expressed at 681 that s 410B(2) "excludes liability on the part of Pilbara for the negligence of its servant… in the course of his employment" were set out at 683-85. Dawson J did begin with a discussion of the position of the harbour authorities and Fowles at 682-83. However, his Honour emphasised the common law position of voluntary pilotage and its consequence in terms of the relationship between the shipowner and the pilot and referred to Bucknill LJ and the House of Lords in The 'Towerfield', through them The 'Beechgrove' and Thom. In that context Dawson J said at 684 and 685: It [s 15(1) of the Pilotage Act] has been held to create statutorily the relationship of master and servant between the shipowner and the pilot as if the pilot had been voluntarily employed by the shipowner. … …The vicarious liability imposed by the section [s 410B(2)] is as if the pilotage were not compulsory, that is, as if it were voluntary. That means, fiction though it might be, that the position of the compulsory pilot as regards the owner is one in which the maxim respondeat superior applies, necessarily excluding the responsibility of some other person upon the same basis. … 107 Thus the majority of the Court concluded that if s 410B(2) applied (there being no issue in that case that it did not) it operated to create the relationship of master and servant between the shipowner and the pilot, through the application of a paradigm, adopted by the statute having its origins in the general law. We do not read any of the judgments of the majority as saying that application and effect of s 410B(2) depends upon the pilot being licensed. The position of the owner is to be taken as if the pilot had been taken on voluntarily - with the consequences that had at general law. 108 In Esso Petroleum Co Ltd v Hall Russell & Co [1989] 1 AC 643, the House of Lords once again considered s 15(1) of the Pilotage Act. There, a tanker, Esso Bernicia, hit a number of dolphins during berthing. There was an escape of bunker fuel from, and damage otherwise to, Esso Bernicia, as well as foreshore pollution damage. The accident was caused by one of three tugs having cast off its tow line after a coupling blew out of an hydraulic pipe above the exhaust on that tug, causing a fire. The shipowners sued the tug's builders who cross-claimed against the council, the pilot's general employer. The accident occurred in a compulsory pilotage area. Lord Jauncey of Tullichettle laid down the effect of s 15(1). His Lordships views were unconditionally agreed with by all the other Law Lords sitting: Lord Keith of Kinkel, Lord Brandon of Oakbrook, Lord Templeman and Lord Goff of Chieveley. 109 Lord Jauncey referred to the general law's distinction between voluntary and compulsory pilotage and to The 'Maria', The 'Beechgrove', Thom, The 'Towerfield' and Oceanic. In stating the effect of s 15(1), Lord Jauncey said, at 684-86, that the pilot was to be considered as the servant of the owner for all purposes. 110 Lord Jauncey did refer (at 687-88) to Holman and distinguished it as follows: The basis of that decision was that an unlicensed pilot working about the harbour remained the servant of the harbour authority in contradistinction to a licensed pilot who occupied an independent position. … 111 It may, with respect, be doubted, whether an element of the basis of the decision in Holman was not the undertaking or contract by the trustees to the shipowner. Nevertheless, the above was not a considered conclusion by his Lordship, as a matter of statutory interpretation, that s 15(1) of the Pilotage Act did not apply to unlicensed pilots. It was only necessary for Lord Jauncey to express the general rule as he did at 690-91 as concerning licensed pilots because that was the position before him: My Lords, it may be stated as a general rule that the employer of a qualified licensed pilot is not vicariously responsible to the owner of a ship damaged by his negligence while under pilotage. All the authorities support such a rule and none appear to controvert it. The basis of the rule is twofold, namely: (1) the pilot is an independent professional man who navigates the ship as a principal and not as a servant of his general employer, and (2) section 15(1) makes him the servant of the shipowner for all purposes connected with navigation. In stating this rule I am not going so far as to say that an employer of a licensed pilot could never be responsible for his negligent navigation. It is theoretically possible that such an employer could himself assume the obligation of safe pilotage although at the moment I have very great difficulty in envisaging a situation in which such an event could occur. However, it unnecessary to speculate further since there is nothing in the present case to take it out of the general rule. It follows that I would reject Hall Russell's second argument on this branch of the case. 112 The proposition that s 15(1) of the Pilotage Act, if applicable, has the effect of treating the shipowner as the employer of the pilot and so responsible for his or her default in the pilotage for all purposes, which can be taken from The 'Beechgrove', Thom, The 'Towerfield' Oceanic and The 'Esso Bernicia', was followed by Clarke J in The 'Cavendish' [1993] 2 Lloyd's Rep 292, in dealing with s 16 of the Pilotage Act 1987 (UK).

The proper construction of s 410B and the arguments of the parties

113 Whilst s 410B(1) is not directly relevant to, or dispositive of, the controversy, its text assists in understanding s 410B(2). The word "pilot" is defined in s 6 of the Navigation Act by reference to an activity and a lack of relationship with the ship or her company ("does not belong to the ship"), and not by reference to any status or licence or qualification of the person conducting the activity. From the Explanatory Notes to the Navigation Bill 1958 that appears to have been deliberate. In contrast, Part IIIA of the Navigation Act deals with pilotage in the Australian coastal sea (as defined). Section 186B (within Part IIIA) contains a definition of the phrase "licensed pilot" as meaning: a person who is licensed as a pilot under this Act 114 It was common ground that Part IIIA was inapplicable to Port Kembla harbour. Nevertheless, textually, the existence and terms of Part IIIA assist the Corporation in its submission that the word "pilot" in ss 6 and 410B(1) of the Navigation Act should not be limited to licensed pilot under any relevant law (State, Territory or Commonwealth) or a person who has the conduct of a ship in a lawful manner by reference to any such law. 115 Also, this history of s 410B and before it ss 351 and 352 reveals that references to licensing that previously existed have been removed. No attempt was made by Braverus to seek assistance in argument from those previous provisions. On the other hand, the Corporation sought to gain comfort from the contrast, legitimately so, given the deliberate nature of the change. 116 Turning to s 410B(2), it does not refer to a pilot, or to a pilot being licensed. Rather, in certain circumstances the owner or master of a ship is answerable for loss and damage. Those circumstances are: a ship navigating under circumstances in which pilotage is compulsory under a law of a State or Territory The sub-section is directed to the facts which, objectively speaking, require something to be done: pilotage to be undertaken on a compulsory basis. The lawfulness of the pilot's conduct in that pilotage, or the status of his or her licence at the time of the conducting of the ship are irrelevant questions to the ascertainment of whether circumstances exist which make pilotage compulsory. Those circumstances are revealed by the provisions of the relevant law of New South Wales: ss 77, 78 and 79 of the PCWM Act, which are in the following terms: 77 (1) In this Part: "pilotage" means the conduct of a vessel by a pilot as follows: (a) inward pilotage, that is, the pilotage of a vessel entering into a pilotage port,

(b) outward pilotage, that is, the pilotage of a vessel leaving a pilotage port,

"pilotage port" means (subject to subsection (2)) any of the following ports:

(a) in relation to pilotage services provided by a Port Corporation under an operating licence - the Port Corporation, or

(b) in relation to pilotage services provided by a contractor under a contract under section 81 - the contractor, or

(c) in relation to any other pilotage services - the Minister. (2) The regulations may provide that any other port is a pilotage port for the purposes of this Part or that a port is no longer such a port. (3) A reference in this Part to pilotage services provided by a Port Corporation includes a reference to pilotage services provided by a subsidiary of the Port Corporation, and a reference to a pilotage service provider is to be construed as including a reference to any such subsidiary providing pilotage services. 78 (1) Pilotage is compulsory in every pilotage port. (2) The master of a vessel must not enter, leave or move within a pilotage port with the vessel before taking on board the pilot made available by the pilotage service provider to conduct the vessel on its movement into the port, out of the port or within the port. Maximum penalty: 100 penalty units. (3) This section continues to apply even though a pilot has deferred pilotage under this Part. 79 (1) Pilotage is not compulsory in a pilotage port in respect of the following vessels: (a) a vessel whose master is the holder of a pilotage exemption certificate or certificate of local knowledge under the Marine Pilotage Licensing Act 1971 that applies to that port and vessel,

(e) a vessel of any class declared by the regulations to be an exempt vessel for the purposes of this Part,

(f) a particular vessel declared to be an exempt vessel for the purposes of this Part by order of the Minister given to the owner or master of the vessel.

(2) Despite subsection (1), pilotage is compulsory in respect of a vessel (whether or not the master is the holder of a pilotage exemption certificate or certificate of local knowledge) if pilotage is declared to be compulsory by the regulations or by order of the Minister given to the owner or master of the vessel. 117 Braverus argued that the status of the pilot as licensed was one of the circumstances referred to in s 410B(2). This argument requires s 410B(2) to be read as meaning when the ship is navigating in the charge of a licensed pilot. There is no doubt that to the extent that s 15(1) of the Pilotage Act was intended to abolish the defence of compulsory pilotage under s 633 of the MSA 1894, it only needed to deal with the circumstances of a licensed pilot - that was one of the required elements of s 633. Also, s 351(2) in its original form, read with the then definition of "pilot" in s 6, limited the operation of the sub-section to a person appointed or licensed under the Navigation Act. However, as can be seen from the 19th century cases the general law concerned itself with compulsion as the essential factor removing the relationship of master and servant created by the voluntary engagement. 118 The argument of Braverus that the ship was not "navigating under circumstances in which pilotage is compulsory under a law of a State or Territory" does not deal with the plain words of s 410B. Those words direct attention, in the circumstances here, to the relevant laws of the State of New South Wales. Sections 77 to 79 of the PWCM Act plainly make pilotage compulsory in Port Kembla. Section 410B(2) directs attention to the legal enquiry of what law of a State or Territory might answer the description of making pilotage compulsory, and to the factual enquiry of whether the circumstances were such as to attract the operation of that law. If those two inquiries are satisfied, the section does not on its face direct a further inquiry into whether the State or Territory law was actually complied with. 119 The words of s 410B(2) require that Braverus be answerable for the loss or damage caused by the fault of the navigation of the ship in the same manner as the owner would (be answerable) if pilotage were not compulsory - that is if pilotage were voluntary. One is therefore driven back to assessing the position of Braverus on the basis of a posited relationship: non-compulsory pilotage, that is the engagement voluntarily of a pilot. Subject to Holman, the 19th century cases are clear about the position of a pilot voluntarily engaged. The pilot taken on was the servant of the shipowner, and seen as effectively incorporated within the ship's company. Licensing of the pilot and the fulfilment of an independent public duty played no part in this conclusion. Those matters did, however, provide a reason why any harbour authority or general employer of the pilot was not liable vicariously for the fault of the pilot. The licensing of the pilot and the independent public duty were not, however the legal reasons why the pilot was seen as part of the ship's crew. Though, to the extent that statute relieved the shipowner of this relationship (and its consequences) licensing played a part. 120 Thom, The 'Towerfield' and Oceanic demonstrate that the notion of answerability extends to giving the statutorily created employment relationship its full effect in all aspects of the legal position of the shipowner. 121 Holman is not authority for the proposition that in all cases of voluntary pilotage, if the pilot is not licensed, the relationship of master and servant between shipowner and pilot cannot arise. It is certainly authority for the proposition that if, in circumstances of voluntary pilotage, the harbour or pilotage authority agrees personally to bring the ship in with due skill, it will be responsible contractually for the fault of its employee. That fault will be the agency of its breach. The claim of Braverus that the Corporation did so contractually undertake will be dealt with later. At this point, we deal only with the proposition that the unlicensed status of Capt James meant that s 410B(2) did not have the consequence of any statutorily prescribed relationship of employment between him and Braverus on the hypothesis of voluntary pilotage, at least in respect of the potential liability of the pilot's general employer. 122 If Braverus were right in that argument, the consequence would be that licensed pilots would be servants of the shipowner, but unlicensed pilots would remain the servants of the general employer, the Corporation, at all times throughout the compulsory pilotage, either for all purposes (including liability to third persons) or only for liability as between the shipowner and general employer of the pilot. The former may be seen to be a capricious result, given the history of the incorporation of the pilot into the crew in voluntary pilotage; the latter would have the pilot subject to two masters in the conduct of his or her duties. 123 Braverus submitted that the independent (and so licensed) position of the pilot was integral to the decision in Oceanic. For the reasons that we have expressed, we disagree. It was integral to one basis for the decision. It was not integral to the application of s 410B(2). The relevance of that section depends on its terms. Central to this submission of Braverus was the proposition that the pilot was only assimilated to the position of a servant if he was licensed. For that general proposition reliance was placed on Holman. For the reasons that we have expressed we do not consider that Holman stands for that general proposition. 124 Braverus sought to distinguish Oceanic by s 7 of the LR(VL) Act. That section is in the following terms: Notwithstanding any law to the contrary, a master is vicariously liable in respect of a tort committed by the master's servant in the performance or purported performance by the servant of an independent function where the performance or purported performance of the function:

(a) is in the course of the servant's service for his or her master or is an incident of the servant's service (whether or not it was a term of his or her contract of service that the servant perform the function), or

(b) is directed to or is incidental to the carrying on of any business, enterprise, undertaking or activity of the servant's master.

125 Whilst the existence of that provision would have a clear effect on the relevance of the rule reflected by Fowles, if Capt James had been licensed, it can be assumed that the primary judge did not refer to the provision because of a view (correct, we think) that the section was irrelevant if Capt James was unlicensed. The "independent function" was not relied on by the primary judge. Section 7 operates in circumstances found not to exist by the primary judge: the existence of the independent function. Also, the Corporation was not a "master", nor was Capt James its "servant" whilst on board Fortius. Section 410B(2) and s 85 made that relationship between him and Braverus. 126 Braverus also sought to distinguish Oceanic because it did not involve a claim by a shipowner against a harbour or pilotage authority. In the light of the width of the content of s 410B(2) given by Thom and The 'Towerfield', we see no relevant distinction to be made. 127 Section 410B provides for a regime such that the shipowner is answerable for fault in navigation in circumstances of pilotage on the hypothesis created by statute that the pilot is the servant of the owner. This statutorily created relationship is attributed to the parties for all purposes. This result flows, we think, from Oceanic, once on concludes, as we do, that s 410B applies in these circumstances. Thus, subject to there being an independent contractual relationship between the Corporation and Braverus or a personal duty on the Corporation, the relationship between those parties is to be assessed on the basis that Capt James was the servant of Braverus and not of the Corporation, his general employer. 128 The construction of s 410B(2) which we favour - that an unlicensed pilot taken on in circumstances in which pilotage is compulsory is taken to be voluntarily engaged and the servant of the shipowner is reinforced by the clear terms of s 410B(1): the master of the ship (and through him or her, the shipowner) remains responsible for the conduct and navigation of the ship and the pilot (licensed or unlicensed, the definition in s 6 being silent in that respect) is under the authority of the master of the ship at all times. In our view, s 410B as a whole can be seen as creating a regime of (at least civil) responsibility upon the shipowner for the fault of any person who does not belong to, but has the conduct of, a ship, on the basis that that person is the servant of the shipowner and no-one else. Thus, any liability, or any claim, of the shipowner arising from the pilotage has to be assessed on that basis. A claim by the shipowner based upon sheeting home liability to another party for the vicarious responsibility of that party for the negligence of the pilot will fail. Claims that may arise otherwise, such as in contract whereby that other person has personally contracted that the pilotage will be done with skill and care, or that only a licensed pilot will be provided, or likewise in tort would remain. 129 Such a construction conforms with the text of s 410B, with the historical context of the relationship in voluntary pilotage and with a recognition of the limitations of Holman. We see no impracticality or inconvenience. It is a construction which does not offend what the High Court said in Puntoriero. This is not so much an immunity as the creation of a regime of responsibility based on the authority of the master of the ship. This construction also leads to the conclusion, intended we think, that the practical reach and operation of s 410B(2) will not depend on what might be the differing State or Territory laws, if any, regarding licensing. 130 Thus, we agree with the primary judge's dismissal of the cross-claim of Braverus against the Corporation in tort and in contribution. 131 These same reasons would see any claim under the TP Act similarly defeated. Any misleading or deceptive conduct (which, at this point, we assume) was not by a servant of the Corporation in its trade or commerce (which, likewise, at this point, we assume) but by an employee of Braverus. Section 84(2) of the TP Act does not require reconciliation with s 410B in this respect, it is simply not engaged. 132 This being the consequence of s 410B, no separate analysis is required of s 85 of the PCWM Act. There was no argument put on appeal that s 85 should carry a different meaning to s 410B. 133 Once one concludes that as a matter of statutory construction s 410B(2) applies in circumstances where Capt James was not duly licensed, the reach and scope of the sub-section are determined by the cases of high authority, in particular the views of the majority in Oceanic, to which we have referred, set against the history which we have outlined. Whether or not such a conclusion would be independently reached now, or whether modern conditions require another approach (see the judgments of Brennan J and Deane J in Oceanic and Rajadurai A "Vicarious Liability for Negligent Pilotage in Victoria" (2002) 16 MLAANZ Journal 39) are not matters for an intermediate appellate court. This is especially so in an area to which international commercial and insurance considerations apply and where it can be said that uniformity, consistency and simplicity are not merely virtues, but are also informing legal considerations.

The asserted liability of the Corporation under the TP Act

134 In this section for ease of comprehension we will generally refer to Capt James as the pilot and to Capt Krol as the master. 135 Braverus cross-claimed against the Corporation on the ground that the conduct of the pilot in purporting to pilot the vessel safely through the inner harbour contravenes s 52(1) of the TP Act. Braverus said that the conduct of the pilot was in trade or commerce because it was carried out by the pilot on behalf of the Corporation in the course of the Corporation's business activities. The conduct was alleged to have been misleading because, by giving orders and express or implied assurances in the course of pilotage, the pilot misled the master into believing that, by such orders and conduct, the vessel would be safely berthed. It was also alleged that the conduct was misleading because the pilot failedto give orders that would have resulted in the vessel safely completing its turn in the inner harbour, so as to avoid collision with the berth. 136 Braverus contended that, at all relevant times, the pilot had practical control of the vessel and, by his navigational commands, inaction and failure properly to inform and interact with the master in the conduct of the vessel, he engaged in conduct likely to mislead the master. Braverus submitted that the pilot held himself out, and was held out by the Corporation, to be a pilot licensed to act as a pilot for the conduct of vessels in Port Kembla, with expertise in that port and a close familiarity with the port. Braverus claimed that the failure of the pilot to give appropriate commands for the safe navigation and berthing of the vessel was a cause of the collision. In addition, Braverus claimed that the pilot gave assurances to the master when he had no reasonable basis for doing so and that those assurances and related commands amounted to representations with respect to future matters. 137 The primary judge dismissed the s 52 claim. His Honour considered that the pilot was carrying out the statutory function of a pilot under the PCWM Act and, since this was not a function with a trading or commercial character, s 52 did not apply. His Honour expressed the view that the acts or omissions of the pilot in berthing the vessel were analogous to the giving of hand signals by the driver of a truck in the course of a carrier's haulage business. In Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594 at 602-603, the High Court said that this was an example of conduct beyond the reach of the expression "in trade or commerce", notwithstanding that the signal was given in the context of carrying on a commercial business. Simply because a person carries out work of a professional nature in performing a statutory function, and is remunerated for so doing, the work is not thereby transformed into an activity that bears the required trading or commercial character. 138 In addition, his Honour concluded that, even if the pilot's conduct was in trade or commerce, the master was not in fact misled or deceived by the conduct because, at the relevant time, the master made his own independent assessment of the conduct, the appropriateness of the orders given by the pilot and the emerging risk of collision. His Honour therefore concluded that the claim did not satisfy the requirements of s 52 because the master did not rely on the silence or conduct of the pilot.

trade or commerce 139 The first question on the s 52 issue is whether the conduct of the pilot was in trade or commerce. 140 After the judgment of the primary judge was given, the High Court, in NT Power Generation Pty Ltd v Power and Water Authority (2004) 210 ALR 312, considered the characterisation of conduct by a statutory body in relation to a claim of Crown immunity. The High Court reversed the decision of the Full Federal Court given in 2002. In that case, the question was whether the Power and Water Authority of the Northern Territory (the "Authority"), a statutory authority, carried on a business within the meaning of s 2B of the TPA. The High Court decided that the Authority did carry on a business, notwithstanding that its activities involved the discharge of statutory functions. In the majority judgment given by McHugh ACJ, Gummow, Callinan and Heydon JJ, their Honours noted that the Authority was carrying on a substantial business and had used its infrastructure as part of the means of conducting a business of generating and supplying electricity. 141 Their Honours referred to statements in numerous internal documents of the Authority indicating that its officers considered that it was carrying on a business. Their Honours noted that the 1998 Annual Report of the Authority spoke of the "core business" of the Authority and the fact that it was undergoing "commercialisation" of its functions. It also referred to the "commercial functions" of the Authority and its aim to thrive in the competitive north Australia utility services market. Their Honours mentioned other statements in the Annual Report that referred to the Authority's activities as a "business" and the need to generate a return on the significant amount of capital invested. In this context, the Annual Report referred to the need for efficiency and cost-effectiveness. Their Honours noted that the Annual Report discussed commercial and financial criteria such as the need for a suitable rate of return on assets and the debt to capital ratio. Their Honours observed that the language of the Annual Report and the manner of accounting corresponded with those in many non-governmental trading corporations. Their Honours further observed that, under the Power and Water Authority Act 1987 (NT), the Authority had to conduct itself in "a commercial manner" and that the Authority itself referred to its facilities and services as business products and commercial services. The Annual Report, in general terms, treated the operation of the Authority as a business. In the light of this documentation, their Honours observed at [55]: These are admissions. Technically they are "informal" admissions, but, having been made pursuant to statutory duties and in a document which there was a statutory duty to make public, they are of the utmost solemnity. The admissions in relation to the transmission and distribution facilities, in particular, are totally inconsistent with the case on the application of s 2B which PAWA propounded in this litigation. See also the further remarks of their Honours in relation to this question at [52]-[54] and [65]-[70]. 142 Taking a similar approach to the evidence in the present case, we consider that the conduct of the pilot in carrying out the pilotage was in trade or commerce. The legislation and the records of the Corporation point strongly to this conclusion. Section 9 of the PCWM Actstates that one of the principal objectives of a State-owned corporation is to be a successful business, including to operate as efficiently as any comparable business in order to maximise the net worth of the State's investment in the corporation. This is a commercial objective. Another objective of a State-owned corporation is to facilitate and promote trade through its port facilities. The concept of "promotion" has a trading and commercial flavour. As part of the functions that it may perform, a port corporation is empowered to conduct any "business", whether or not related to its principal activities, that it considers will further its objectives (s 10). The Corporation has a statutory duty to charge for pilotage services and these charges may be at different rates in different ports. 143 The Corporation is a State-owned corporation controlled by the State and is subject to the State Owned Corporations Act 1989 (NSW). Section 20E of that Act is in similar terms to s 9 of the PCWM Act, in that it states that it is an objective of every statutory State-owned corporation to be an efficient and successful business and to maximise the net worth of the State's investment. 144 The Court was taken by counsel for Braverus to numerous documents and records of the Corporation, including Annual Reports over a number of years, financial statements, commercial initiative statements and statements of corporate intent, together with business plans and invoices. In many respects, they are similar to those in the NT Power case. 145 This material, in our view, establishes the following: · the Corporation has a statutory obligation to operate at least as efficiently as a comparable business; · the Corporation's website refers to its capability to handle anything from coastal services to cape vessels; · the charges for pilotage services are subject to the Corporation's terms of trade and the charge rate takes into account the skill factor for piloting large vessels; · the Corporation charges significant fees for the pilotage service; · from 1995/1996, the Corporation's revenues from pilotage have been in excess of $2 million per financial year; · the Corporation pays GST on its charges; · the Corporation treats pilotage services as part of its "core business"; · pilotage revenue is treated as a high revenue business line and the Corporation reports to its share holders as to actual results, including for pilotage income, as against budget; · in its Annual Reports from 1996 to 2001, income derived from the provision of pilotage services is recognised as revenue of the Corporation; · the Corporation adjusts its pricing policy to make it competitive with comparable ports; · the Corporation monitors prices charged by other ports for pilotage services to attract business; and · the Corporation perceives itself to conduct a commercial pilotage operation and acts accordingly. 146 In light of these features, we are persuaded that the Corporation, on its own admissions and records and having regard to the legislation and manner of providing pilotage services in this case, was engaged in trade or commerce. It is evident that the pilotage was carried out in the broader context of providing services for a ship that was engaged in trade or commerce and where the Port Kembla Coal Terminal was also engaged in trade or commerce. 147 For these reasons, we conclude that, having regard to the principles recently expressed in NT Power, the pilotage was carried out in trade or commerce. The objectives of the Corporation and the performance of its statutory functions in this case are permeated with indicators of commercial objectives, strategies and profit-making methodologies such that the conduct can properly be characterised as being in trade or commerce. 148 We think that any conduct of the pilot, if misleading or deceptive, was in the trade or commerce of the Corporation and not merely in the course of or incidental to an overall trading or commercial business: cf Concrete Constructions at 602-603. The conduct of the pilot was the service being provided in trade or commerce. It was different from the driver's hand signal in the example given in Concrete Constructions at 603. The very subject matter of the trade or commerce was the conduct of the ship by the pilot in company with the master.

misleading or deceptive conduct and reliance 149 For reasons given at [304] to [320] of his judgment, the primary judge preferred the general account of the events leading up to the collision given by the master as opposed to that given by the pilot. However, both the master and the pilot were of the view that the risk could have been avoided if the engines had been placed full astern at that point as there was still sufficient time to arrest the forward movement of the vessel: see [112] and [133] of the primary judge's reasons in respect of the pilot and master, respectively. If necessary, tug assistance could have been enlisted to further arrest the movement of the vessel towards CB2. However, a full astern order was not given until the master issued an order to this effect when the vessel was about 20 metres from CB2. By this time, the collision was inevitable. His Honour summarised the master's evidence, which he accepted, as follows:

· it was his view that if something was not done there was an ever increasing danger of collision with CB2 after the 150 metre point;

· if the engines were put to full astern there would still be sufficient time to avoid a collision. (It takes about one minute to stop the vessel by putting the engines at full astern when she is travelling at one knot);

· any local knowledge the pilot may have had was irrelevant because the ship was in a position of potential danger to which local knowledge had no relevance;

· the pilot gave no reason to the master for not acting in accordance with his statement that the engines should be put to full astern;

· the master did not seek any clarification from the pilot as to why the pilot had advised dead slow astern, or any explanation for the pilot's failure to follow his instruction;

· if he had given the order for full astern the risk of collision with CB2 would have disappeared; and

· the master should have told the pilot that he did not accept his advice that the engine should be placed at dead slow astern, and should have himself ordered full astern.

150 At [614], his Honour, speaking of s 52, said: Even if the section did apply, there is a question as to whether the Pilot's conduct was misleading or deceptive or causative of the loss. On my findings, the Pilot should have ordered the engines to be engaged at full astern at the 150m point, which order he failed to give. The case is thus one of failure to issue an order, or remaining silent. The pilot knew at the 150m point that the … engines should have been engaged at full astern and the Master had a reasonable expectation that such information would be disclosed to him. The failure on the part of the Pilot to convey that information to the Master was thus conduct which was likely to mislead or deceive. However, the Master was not in fact misled or deceived. The Master made his own assessment of the situation and of the advice he was receiving from the Pilot and came to his own conclusion that the engines should have been put full astern at the 150 metre point. The claim under s 52 therefore also fails for want of reliance on the part of the Master upon the Pilot's silence. (Emphasis added) 151 It is important to note that his Honour's observation as to misleading or deceptive conduct is made in respect of the circumstances existing up to and at the 150 metre point. His Honour did not analyse in detail the conduct of the pilot after the 150 metre point in relation to the misleading or deceptive conduct issue. His Honour's finding was that the time the vessel would have taken to travel the 130 metres to the 20 metre point when the "full astern" order was given was probably more than one and half minutes. This finding is not challenged. There is no finding by the primary judge as to whether the conduct of the pilot after the 150 metre point was misleading or deceptive. It is evident from his Honour's reasoning that he considered that the master did not, at or after that point, believe that what he was told was correct and therefore he was not misled. In order to succeed, the appellant must satisfy the Court that the finding of non-reliance made by his Honour should be set aside. 152 Braverus relied on the conduct, statements and omissions of the pilot in the pilotage of the vessel through the inner harbour of Port Kembla to berth the vessel in the eastern basin. The misleading or deceptive character of the conduct was alleged to arise from the inaction and orders of the pilot in giving the orders set out in pars 41, 46, 50, 57, 60 and 61 of the statement of the master. It was also alleged that by giving the assurances set out in paragraphs 49 and 54, the pilot misled the master into believing that the vessel would be safely berthed, when this in fact did not occur. It was further alleged that the pilot failed to issue orders that would have resulted in the vessel safely completing its turn in the inner harbour so as to avoid collision with CB2 and that the pilot failed to warn the master that he could not achieve a safe berthing. 153 The statement of the master can be summarised as follows. When the vessel came into the inner harbour, the pilot said to the master "starboard 20". The master repeated this order to the helmsman. The next order given by the pilot was "hard to starboard". This was repeated by the master to the chief officer. The master then asked the pilot whether there was sufficient room to turn before "the dolphin", which was a reference to the mooring platform at the end of the grain and multi-purpose berth. The pilot replied in the affirmative. As the bow of the vessel passed near the dolphin, the pilot ordered "engines slow ahead". The master repeated this order to the chief officer. This happened at 13:56, before the 150 metre point. The master's evidence was that, at this time, he trusted the judgment of the pilot because he assumed the pilot was familiar with the port and was able to take into consideration all prevailing conditions, including currents. About 30 seconds later, the master noted that the vessel was advancing slowly rather than turning to starboard. The master then said to the pilot that the speed was too high and the vessel was moving forward too much. He asked whether there was sufficient room to move safely into the berth. The pilot replied that the vessel was not moving forward too much and that it was all right. The master considered that the pilot was becoming stressed and agitated. At 13:57, the pilot ordered that the engines be stopped and this was repeated by the master to the chief officer. The vessel continued to move forward, whereupon, at the 150 metre point, the master said to the pilot that the engines should be put full astern to stop forward movement. The pilot did not accept this and gave the order "dead slow astern", which was then repeated by the master to the chief officer. 154 The master, at and after this point, by reason of his different view, had reason to doubt the performance of the pilot. The vessel continued to move forward and the pilot gave the order "slow astern", which was repeated by the master to the chief officer. The master then enquired of the second officer how far the bow of the vessel was from CB2. He received a reply from the second officer that the distance was 40 metres. This was repeated to the pilot. After 10 seconds, the second officer said to the master that the distance was 35 metres and this was relayed by the master to the pilot. After another 10 seconds, the second officer said that the distance was 30 metres and this was relayed by the master to the pilot. These reports as to the diminishing distance were given from the forecastle. 155 Very shortly after this, the master formed the view that the vessel was too close to CB2 and was likely to collide with it. He asked the pilot "How are we for distance?" but the pilot did not reply. The second officer reported that the vessel was approximately 20 metres from CB2, whereupon the master gave a direct order to the chief officer "full astern". This order was given at 13:58. The pilot, during this time, was on his walkie-talkie to the tugs. When the order "full astern" was given, the master ordered the helmsman to put the rudder to midships. However, it was too late. At 13:59, the bow of the vessel collided with CB2. At that point, the master concluded from the pilot's mannerisms that he was very stressed and agitated. After collision, and with the engines "full astern", the vessel began to move astern. 156 In considering whether there was reliance by the master, it is appropriate to keep in mind that the question is one of fact and that, in deciding the question, the primary judge had the benefit of observing the master over four days in the witness box: cf Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd (2001) 117 FCR 424 at[1], [2], [24] and [25]. 157 The master did not assert that the conduct or silence of the pilot led him to the belief that the vessel would be safely berthed. Nor did he state that he was misled by the conduct or omissions of the pilot into refraining from taking any action. Having regard to the central importance of this element, one would have expected such evidence of the master's understanding to be led in chief or, at the very least, to have been stated in some record or testimony. After all, it would have been a simple matter to adduce this evidence in oral or written form. The notion of being misled or deceived is a straightforward human concept. In a practical context such as this it would involve a feeling of being let down by someone in whom some reliance was placed. One would expect that evidence to be forthcoming. 158 The nearest the evidence comes is a generalised statement by the master, in paragraph 51 of his statement, that he trusted the judgment of the pilot because he assumed that the pilot was familiar with the port and would take into consideration all prevailing conditions, including any current that might be present. The master said he had previously noted that there was a river entering the eastern basin of the inner harbour and he knew from his experience that it was possible to have currents, both weak and strong, from waterways entering a harbour. In circumstances where the master agreed that any local knowledge of the pilot was of no relevance after the 150 metre point, such a generalised statement by the master is not sufficient to justify or support any reasonable inference that the master believed the pilot had represented that he could or would achieve a safe berthing. Nor is it sufficient to justify the inference that the master was misled as a consequence of the orders of the pilot or of any failure on the part of the pilot to give any orders or make any statements. 159 In relation to the failure to adduce this critical evidence in chief, the observations of Handley JA in Commercial Union Assurance Company of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389 at 418-419 as to the drawing of inferences are pertinent: In my opinion the Court should not draw inferences favourable to the insured on these matters when no attempt was made to prove them by direct evidence and in particular when no relevant questions were asked of Mr Ferrarese. Rather it seems appropriate to apply the principles of Jones v Dunkel (1959) 101 CLR 298. 160 Handley JA adopted and applied the following statement of Follett J in Milliman v Rochester Railway Co 39 NYS 274 (1896) at 276: Indeed I think the omission to interrogate a friendly witness in respect to facts presumably within his knowledge is more significant than the failure to call such a person as a witness, and that the presumption that the testimony would not have been favourable to the party's case is stronger than the one which arises from the failure to produce such a person as a witness. 161 Braverus submitted that it must be inferred, as a practical matter of common sense, that it was an important consideration for the master in the time period between the 150 metre point and the 20 metre point, when the master took over, that the pilot was directing and co-ordinating the tugs and, by reason of this, the pilot must have been understood to indicate that the danger could be avoided. This suggested conclusion as to the master's state of mind is by no means an obvious one, especially in view of the fact that the master did not say that these were considerations which he took into account or which were present to his mind at that time. It is convenient at this stage to look at the evidence of the master. 162 When asked in cross-examination why he did not challenge the dead slow astern order at the 150 metre point, with which he disagreed, the following exchange took place with Captain Krol: Why didn't you say to him, that is not an appropriate order, the vessel should be put full astern in my opinion as a master; why didn't you say that? - I agree. Captain Krol was there conceding that he did not express his disagreement. He was then asked: By this time [the 150 metre point] any local knowledge which the pilot had had ceased to be relevant because the ship was in a position of potential danger to which that local knowledge had no relevance; do you agree with that? - Yes. Captain, if your version of the events leading up to what you say the pilot said to you in paragraph 60 of your statement is correct, then at that point of time you should have taken control of the vessel from the pilot? - I take the control of the vessel … You should have done so? - That was just a few seconds later. 163 No evidence of his understanding or belief or reliance after the 150 metre point was given in chief. The above questions gave the master an opportunity to state in cross-examination, if it were the fact, that he was relying on what the pilot had told him or that the conduct of the pilot indicated to him that the danger would be avoided. Further, it was open to him to say what it was about the pilot's conduct that led him to an understanding of such a representation. He did not disagree with the proposition that he should have taken control of the vessel at the 150 metre point. His answer to the effect that he took control a few seconds later is clearly wrong on his Honour's finding that the period was probably more than one and a half minutes. The master took control of the vessel 20 metres from the collision point, which was too late, and the above conversation took place at about the 150 metre point in circumstances where the vessel was moving quite slowly. 164 Braverus submitted that it must be concluded that the control by the pilot of the tugs was an important consideration in the mind of the master. The Court was taken by Braverus to part of the cross-examination of the master where, in relation to the giving of the dead slow astern order at the 150 metre point, the following exchange took place: It was the pilot who when you said "full astern" disagreed and said "dead slow astern" didn't he? - The pilot said "dead slow astern". Even though you thought the proper order to the engine room should have been full astern? - Yes, by this time also the tugs were working. 165 It should be noted that this reference by Capt Krol to the tugs was made shortly after an intervention by counsel for Braverus in the presence of the witness stating that the position of the tugs had to be built into the scenario of the question posed by the cross-examiner. The following question and answer then followed: The reason you should have said that was because in your opinion if the ship was not put full astern at that stage there was a real risk of collision with the number 2 coal loading wharf; isn't that case? - It was a risk but also the tugs working this time. 166 In re- examination, Capt Krol was asked: What fault were you saying the pilot was responsible for for (sic) the collision in these answers at 310 and 311? - He was not provide me with the passage plan pilot card and also his manoeuvring in port of the vessel to turn it to starboard with tugs helping was turning wrong as the vessel had collided with the wharf. 167 Capt Krol was also asked: What did you have in mind when you were referring to the tugs working at this time? What were they were doing as you were referring to in that answer? - So that means the tugs which were on the forward - centre forward - she was just going to the starboard. The aft tug was going to the port. But the starboard side, alongside. That means starboard quarter and the starboard shoulder they were almost alongside the vessel to - let's say to stopping the forward movement. That means to arrest the vessel's speed. 168 Capt Krol did not say that he relied in any way on the pilot's communications with the tugs. 169 Finally, counsel asked Capt Krol, after referring to his evidence about what occurred at the 150 metre point: And a few lines down he asked you: "You should have done so" and he says - you said "That was just a few seconds later". Now, why didn't you take command of the vessel at that time? - This time I was also asking the pilot of the - if we - during the turning the thing is our turning is correct and we will pass safety - the bow will pass safety the coal berth number 2 and he was replying yes. 170 Capt Krol does not here say that he understood the conduct or any statements of the pilot to be assurances that the vessel would be safely berthed. Nor does he say that he relied on, or was misled by, any specific statements, omissions or conduct to conclude that this would happen. Nor does he make any statement that he relied in any way on the conduct, statements or omissions or any other conduct by the pilot. The answer in the last exchange referred to above is equivocal because it does not refer to the one and a half minute period after the 150 metre point and is consistent with his Honour's conclusion that the master formed his own judgment at 13:57, the 150 metre point, and thereafter independently believed that the bow would pass safely and would not collide with CB2 or otherwise he would have intervened. 171 The master's evidence of the conduct of himself and the pilot after the 150 metre point reflects an ongoing and increasingly critical appraisal by the master of the pilot's conduct after forming the clear view that the pilot had given the wrong order at that point. In accepting and relaying the orders after that point and after he had noted the pilot becoming agitated and distressed, it is evident that the master was closely evaluating the orders of the pilot and forming his own assessment before relaying them to the ship's officers. He was not a mere conduit for the orders committed to him by the pilot. The fact that the master took over and issued orders at the 20 metre point strongly supports the view that, as from the 150 metre point, the master was exercising and relying on his own judgment and relaying orders with which he agreed as a consequence of his own independent assessment. One and one half minutes elapsed between the 150 metre point and the 20 metre point when the master gave the full astern order. His Honour found that intervention at a slightly earlier time by the master would have averted the collision. There was ample time during this period for the master to consider his own position and act appropriately. From the 150 metre point until the 20 metre point, the master believed that the engine should be put to full astern. He had no misapprehension, nor did he believe that the vessel was not moving forward too much or that it was all right. The master was in no doubt after the 150 metre point that the pilot's advice was wrong. This was not a sudden emergency with a single split second decision required at that point. The finding by his Honour that the collision was a very near thing meant that a slightly earlier intervention would have averted the damage. There was no "agony of the moment" scenario in this case. After the 150 metre point, the Captain believed that the engine should have been put to full astern. He was negligent because he did not act in accordance with his own assessment of the situation but delayed acting until it was too late. This was the finding by the primary judge. 172 Some criticism was made by Braverus of the primary judge's asserted failure to deal in detail with the events after the 150m point. The Corporation submitted that that could be explained by the fact that the case under s 52 of the TPA had not been put to the primary judge on the basis of the importance of the detail of these events. We think that there is significant force in this answer by the Corporation. It is unnecessary to descend to the minutiae of the detail of the conduct of the case. The material that we have discussed above allows us to conclude that there was no reliable evidence to found any conclusion that the master relied on the pilot's conduct either at or after the 150 m point. 173 The explanation for the master's delay is his negligence and not his reliance on alleged deceptive conduct or misleading statements. We are therefore not satisfied that his Honour erred in concluding that there was no reliance, as alleged by Braverus, on the part of the master.

174 The primary judge found that no contract was entered between Braverus and the Corporation. Rather, his Honour concluded that the Corporation performed its statutory duty (albeit, if the Corporation were responsible for Capt James, imperfectly). His Honour set out at [579] to [587] of his reasons the manner in which Braverus alleged that a contractual relationship came into existence. No complaint was made as to any underlying finding of fact in this regard. 175 The primary judge said that the essence of a contract was the voluntary assumption of a legally enforceable duty, citing Australian Woollen Mills Pty Ltd v Commonwealth (1954) 92 CLR 424 at 457 (per Dixon CJ, Williams J, Webb J, Fullagar J and Kitto J) and Astley v Austrust Ltd (1999) 197 CLR 1 at 36. 176 At [592] to [595] of his reasons the primary judge set out the legislative framework for his conclusion that the acts of Braverus and the provision of pilotage services by the Corporation were undertaken as required by law. There was no obligation undertaken and no charge made by the Corporation and no request made by Braverus beyond that which were required by the relevant provision of the PCWM Act and Regulations thereunder. No error in that analysis was asserted. 177 The primary judge recognised (at [596] of his reasons) that s 67 of the PCWM Act authorised the Corporation to enter into an agreement beyond the matters provided for by the Act and Regulations. That is, as the primary judge said: Section 67 allows for agreement to be reached, with the approval of the Minister, for a regime different from that which would otherwise flow from the application of the Act. 178 However, as the primary judge said, s 67 had no application in the present case, because there was no agreement for any regime in relation to the provision of a pilot or for payment different from that which the PCWM Act and Regulations made provision; nor was there any approval of the Minister to enter into such a different agreement. 179 The error which the primary judge was said to have committed was to be found in the analysis undertaken by him from [601] to [608] of his reasons. It was submitted before the primary judge and was submitted on appeal that, in the circumstances, there was more than an arrangement on the part of Braverus and the Corporation to discharge a statutory obligation. The additional matters upon which reliance was placed both below and on appeal were the fact that the Corporation was carrying on the business of the provision of pilotage services for profit and that the Corporation assumed the function of piloting vessels into and within Port Kembla itself as opposed to making a licensed pilot available. 180 The Corporation was plainly not aware of the fact that it was providing an unlicensed pilot. We have dealt in the section on the TP Act with our view that the primary judge erred in his conclusion that the Corporation was not engaging in trade or commerce. However, the fact that the Corporation was so engaging in trade or commerce does not lead to the conclusion that it necessarily assumed a contractual obligation. Entry into contracts is a conventional means of doing business. The Corporation is a State-owned corporation. Section 7 of the PCWM Act and the principal objectives in s 9 of the PCWM Act refer to modern principles of government administration exhibiting businesslike activity. Further, s 20F of the State Owned Corporations Act 1989 (NSW) provides that a state owned corporation is not and does not represent the State. The Corporation had a statutory objective to be a successful business and to maximise the net worth of the State's investment in the Corporation, as the primary judge found. 181 From [604] onwards the primary judge analysed the significance of these matters. His Honour concluded that the question of whether there was an agreement or mutual assent depended on the question whether the parties had a choice as to whether they could agree and as to the terms or conditions on which they could or would do so. Where there is compulsion, his Honour said, no question of contractual intent in either party arises: Lismore City Council v Stewart [1989] 18 NSWLR 718 at 726. 182 It was said on appeal that the legal obligation of the Corporation to act and charge as it did and the legal obligation of Braverus to act and pay as it did were not determinative. Particular reliance was placed on NT Power Generation Pty Ltd v Power and Water Authority (2004) 210 ALR 312 and at [85], Puntoriero v Water Administration Ministerial Corporation (1999) 199 CLR 575 at [17], [38] and [88], Airways Corporation of New Zealand Ltd v Geyserland Airways Ltd [1996] 1 NZLR 116 and Bunbury Harvey Regional Council v Giacci Bross Pty Ltd (2000) 117 LGERA 1. 183 Nothing in NT Power falsifies any conclusion reached by his Honour. The fact that s 46 of the TPA may require a party to provide access to a right or to property, failing which he she or it may be exercising a degree of market power is not to the point. Puntoriero is of no assistance to Braverus. The existence of a contract was admitted on the pleadings: Puntoriero at [88]. 184 In Airways Corporation of New Zealand, the applicable legislation did not require the charges be paid to the Airways Corporation and the Airways Corporation was not bound by statute to provide the relevant service. 185 In Bunbury-Harvey, Hasluck J said that the essence of a contract was that there was a voluntary assumption of a legal enforceable duty and that that question will have to be answered by reference to the circumstances of the particular case. 186 These considerations concerning Airways Corporation and Bunbury Harvey perhaps explain why his Honour did not feel it necessary to refer to them. (The failure of his Honour to do so was a matter of criticism by Braverus on the appeal.) 187 It is unnecessary for us to examine whether s 410B of the Navigation Act or s 85 of the PCWM Act would operate to exclude any relevant liability on the part of the Corporation in respect of any such posited contract. The Corporation asserted that it would rely on The 'Towerfield', The 'Cavendish' and Amarantos Shipping Co Ltd v South Australia (2004) 89 SASR 438 at [69] to [73]. It is not immediately apparent to us that if a contract existed whereby the Corporation contracted to provide services (and into which s 74 of the TP Act would imply terms, see below) these provisions of the Navigation Act and the PCWM Act would overcome the contract made by the parties. The posited liability may be seen not to be dependent upon vicarious responsibility of the Corporation for Capt James, but upon an personal obligation assumed by it. 188 None of the cases cited by Braverus in argument overcomes the difficulty so clearly put by the primary judge at [606] of his reasons: The fact that there has been a commercialisation of entities, such as the Corporation, carrying out statutory functions does not alter the fact that both the creation of the relationship between the Corporation and the defendant, and the fixing of its terms, arose by the operation of the PCWM Act. The Corporation offered a pilot to the Fortius because it was bound to do so, and the defendant took a pilot on board the Fortius because it was bound to accept and, as I have outlined above, even the resultant financial obligations between the defendant and the Corporation were imposed by the PCWM Act. The absence of voluntariness and the fact of compulsion operating on both the defendant and the Corporation must inevitably lead to a conclusion that in the case of routine arrangements for the provision of pilotage, such as the present, there is no contract. 189 The reference by Isaacs J in Fowles (1913) 17 CLR 149 at 177 to the government taking up the business of piloting ships was not to such occurring by compulsion of law. Rather, on the contrary, it is clear from a reading of the whole of his reasons (in particular at 183) that Isaacs J was distinguishing the position of conduct required by legislation and the voluntary entering upon the business of piloting ships independently of, and in addition to, that which was contemplated by statute. 190 The conclusions of the primary judge are also in accordance with other authority to the effect that legal compulsion as to the creation of the relationship (that is that the relationship must in the circumstances be formed) and as to the fixing of the terms of the compulsory relationship is inconsistent with the existence of a contract: Norweb Plc v Dixon [1995] 1 WLR 636, 643 and 647; Pfizer Corporation v Ministry of Health [1965] AC 512, 535-36, 544-45, 548, 552-53 and 571; RW Miller & Co v Shortland CC (1988) 83 ALR 225 at 227; Lismore City Council v Stewart (1989) 18 NSWLR 718 at 725-26; and Suatu Holdings Pty Ltd v Australian Postal Corporation (1989) 86 ALR 532 at 542. 191 No doubt some modern government practices reflected by the use of State-owned corporations can be seen to thrust government corporations into the world of business, or, more relevantly perhaps, trade or commerce. That is reflected elsewhere in our reasons that, in our view, had there been a misrepresentation or misleading or deceptive conduct by the Corporation it would have been in trade or commerce. That conclusion, however, does not answer a different, and distinct, question as to whether there was a voluntarily assumed obligation as the foundation for the existence of a contract. 192 We see no error in the approach of the learned primary judge nor in his conclusion that there was no contract between Braverus and the Corporation. 193 The decision of the Full Court of South Australia in Director of Posts & Telegraphs v Abbott (1974) 7 SASR 540 relied on by Braverus in a footnote to its written submissions was dealing with a specific factual situation and is not an authority for any proposition contrary to the approach of the primary judge. That the development of modern government enterprises as a form of outsourced government administration may make contractual relations with governments in the supply of services more frequent can be accepted, but it does not answer a question whether there is room for any voluntary assumption of responsibility in a case such as this. 194 Whilst it is unnecessary to reach a final view on the matter, if we are wrong in our view as to the existence of a contract, we do not see s 74(3) of the TP Act as assisting the Corporation. Section 74(3) of the TP Act is, relevantly, in the following terms: (3) A reference in this section to services does not include a reference to services that are, or are to be, provided, granted or conferred under:

(a) a contract for or in relation to the transportation or storage of goods for the purposes of a business, trade, profession or occupation carried on or engaged in by the person for whom the goods are transported or stored; … 195 The pilotage services were provided (on this hypothesis) under a contract between Braverus and the Corporation. That contract was not for the transportation of goods. Was it a contract in relation to the transportation of goods for the purposes identified by the subsection? We think not. The purpose of s 74(3) was to ensure that the well-known law governing transportation of goods (by air, land or sea) and storage of goods was not to be radically amended by s 74, in particular given the well established insurance arrangements in respect thereof: Explanatory Memorandum accompanying Trade Practices Revision Bill 1986 at paragraph 153; see Heydon JD Trade Practices Law Vol 2 at paragraph 16.850. With that purpose understood, there is no relevant relationship between the contract to provide the services and the transportation of goods. It could be no more said that a contract to provide pilotage services related to the transportation of goods because it was a necessary precondition to get the ship to the berth, than it could be said that a contract to repair the ship before sailing related to the transportation of goods because, without the repairs, the ship would not sail.

The ambit and construction of s 86 of the PCWM Act 196 The primary judge concluded that the Corporation took the benefit of s 86 of the PCWM Act, which is in the following terms: (1) Neither the State, nor the Minister, nor a pilotage service provider is liable for any loss or damage that is attributable to the negligence of any person employed as a pilot by the pilotage service provider while the person is acting as a pilot. (2) A person employed as a pilot by the pilotage service provider is not personally liable in pecuniary damages for any loss or damage attributable to the person's negligence while the person is acting as a pilot. 197 Braverus asserted that the primary judge erred in two respects: (a) in concluding that Capt James, though lacking a licence, was "employed as a pilot" and "acting as a pilot" and (b) in concluding that the Corporation was a "pilotage service provider". (As to (a), para 18 of the Notice of Appeal was limited to the question of "acting as a pilot". The submissions were directed to both phrases. No objection was taken to the width of the submission on this basis.)

acting or employed as a pilot 198 The primary judge concluded at [656] to [660] (incorporating also [417] to [421]) of his reasons that Capt James was employed and acting as a pilot. Part of his Honour's reasoning was the view he took that the difference in definition of the word "pilot" in the Marine Pilotage Licensing Act 1971 (NSW) (the "MPL Act") and in the PCWM Act was of importance. In the MPL Act (an Act, of course, dealing with licensing) the word "pilot" was defined for the purposes of that Act as a person licensed under s 7 of that Act to conduct ships to which he or she did not belong. Under s 6 of the MPL Act a person is deemed not to be a pilot when acting otherwise than in conformity with the relevant licence. Under the PCWM Act, the word "pilot" is defined in very similar terms to the definition in the Navigation Act. 199 The word "pilotage" is also defined by s 77 of the PCWM Act as meaning the conduct of a vessel by a pilot in three described ways. 200 In our view, the primary judge was correct not to imply into the definition of "pilot" in the PCWM Act the word "licensed" or "lawfully". The MPL Act and the PCWM Act are, no doubt, statutes in pari materia in one sense. That does not lead to the conclusion, however, that their specific provisions should, in some sense, be merged. The difference in definition can be seen to be important in the operation of ss 85 and 86 of the PCWM Act to bring them into conformity with the operation of s 410B of the Navigation Act, with its definition of "pilot". We do not see an intention in the PCWM Act to restrict the operation of ss 85 and 86 to the conduct lawfully of the pilotage. The closeness of the relationship of the two Acts and the closeness of their subject matter assist in the conclusion that the clear differences in definition were intended to bring about differences in operation. Sections 85 and 86 of the PCWM Act (as does s 410B of the Navigation Act)work upon a framework of a pilot and pilotage being identified by the objective conduct contained within the definition of the word "pilot": someone who has the conduct of ship or vessel, but who does not belong to her. In that framework, the shipowner has responsibility. The immunities in s 86 can be seen to fall within that framework. 201 That the two Acts were intended to achieve different aims can be seen by the recognition that the MPL Act provides for the licensing of and restrictions on pilots for the safe and efficient working by them of the heavy responsibilities placed on them. The PCWM Act provides in Part 6 for various aspects of the conduct of the activity of pilotage including the circumstances when it is compulsory: ss 78 and 79, the duties of a master: s 84 and the offence of a pilot who endangers a vessel: s 87. It was hardly likely to be intended by Parliament that an offence such as that against s 87 was to be limited to a pilot with a relevantly valid licence and who otherwise acted lawfully, but not to a person who had a defective licence but nevertheless had the conduct of the vessel and did not belong to the ship. The differences in definition appear to us to have been intended.

pilotage service provider 202 The phrase "pilotage service provider" is defined in s 77 of the PCWM Act relevantly as meaning: in relation to pilotage services provided by a Port Corporation under an operating licence - the Port Corporation, … … 203 The phrase "operating licence" is defined in s 3 of the PCWM Act to mean "an operating licence issued to the Port Corporation by the Governor under Division 3 of Part 2". 204 Section 11 of the PCWM Act (within Division 3 of Part 2) defines the phrase "port safety functions" to include": the functions of providing or arranging for the provision of … pilotage services. 205 Section 12 of the PCWM Act provides: (1) The port safety functions exercisable by a Port Corporation are to be determined by the Minister. (2) Any such port safety functions may only be exercised by a Port Corporation in accordance with an operating licence issued to the Port Corporation by the Governor on the recommendation of the Minister. (3) While a Port Corporation holds an operating licence, the Port Corporation must exercise the port safety functions to which it applies and must do so in accordance with the licence, the marine legislation and any other relevant Act or law. (4) This Division does not limit the functions that may be delegated to a Port Corporation under this Act. This Division also does not limit the exercise of port safety functions by the Minister or their delegation under the marine legislation to others. 206 The primary judge concluded at [645] to [655] of his reasons that the Corporation was a pilotage service provider for the purposes of s 86. 207 Braverus contended before the primary judge and on appeal that the licence issued to the Corporation distinguished, as a matter of expression, between the Corporation and the pilotage service provider as different entities. Thus, it was said, the Corporation had never been appointed or licensed as a pilotage service provider. 208 The primary judge construed the terms of the relevant licence issued in 2000 against the background of the practical operation of the industry in relation to which the licence was granted. Since at least 1989, only the Corporation had provided pilotage services in Port Kembla. The licences issued prior to the current licence plainly referred to the Corporation as the pilotage service provider. The changes in wording of the licence were not accompanied by any change in actual practice. 209 We see no error in the approach of the primary judge to the construction of the licence. We agree with his Honour's reasons. 210 Thus, s 86 of the PCWM Act protects the Corporation from the consequences of the negligence of Capt James.

The appeal concerning Port Kembla Coal Terminal 211 We now turn to the appeal as between the plaintiff and Braverus. 212 The primary judge refused to make any allowance for contributory negligence. His Honour's reasons are contained in [443] to [483] of his judgment. 213 The argument for the asserted contributory negligence and the reason why the argument is flawed are straightforwardly explained. 214 The plaintiff's own operating procedures required the parking of the No1 ship loader at or near the centre of the berth at CB2. The reasons for this cannot be more clearly expressed then by using the words of the primary judge at [444] to [449] of his reasons: When the ship loaders were originally commissioned for use in 1982, it was the plaintiff´s practice to park the loaders on the maintenance platforms at either end of CB2 when they were not in use. However, between 1982 and 1984 there were a number of collisions between vessels and the ship loaders when the loaders were parked in that position. By 1985 the procedure had changed. Thereafter the ship loaders were kept off the maintenance platforms at the ends of CB2. The present incident is the first occasion since the 1985 change in procedure where a vessel berthing at, or sailing from, CB2 has damaged either ship loader. The accepted berthing practice at CB2 is to swing the vessel in the inner harbour until the vessel is aligned roughly north-south and parallel to the berth. The vessel is then reversed, stern first, into the Eastern Basin (CB2 being located on the eastern side of the Eastern Basin). When the vessel is about 50 metres off the berth, the vessel is pushed from west to east parallel with and up to the berth. The object is to have the vessel make gentle contact with the berth´s fender system in a parallel position to the berth. The fenders on CB2 have about a 2 metre stand off from the face of the berth. Typically, a vessel flares at the bow and stern so that it overhangs beyond its waterline. If the vessel develops a position whereby it is at an angle to the berth as it is being pushed up to the berth, then the flares at bow or stern can overhang the berth edge, in some cases significantly, and strike any wharf-side appliances, such as ship loaders, that might be adjacent to the bow or stern flares. Usually the stern lands on the berth slightly before the bow, hence it is the No 2 ship loader at the northern end of the berth which is most at risk. CB2 is not long enough to enable equipment such as the ship loaders to be completely removed from the docking area. Of necessity, the rails for the ship loaders had to be close to the edge of the berth to enable the loaders to reach over the ship and to carry out their loading functions. Thus the risk of injury to the loaders if a berthing operation does not go according to plan cannot be completely eliminated. As the loaders cannot be completely withdrawn from the berth face, the next best thing is to position the loaders so that they are clear of where the bow or stern of the ship is likely to be if there is some mishap in the berthing operation. For these reasons, the appropriate practice is to place loaders and cranes (and the ship loaders on CB2 in particular), at a location that will be alongside the parallel (ie, flat) areas of a vessel´s hull, and not adjacent to the zones where the vessel flares at bow and stern. Whether the exercise of reasonable care requires the adoption of some more stringent practice is the subject of controversy. 215 It can be seen from the above that the risk which the operating procedures sought to minimise was the striking of the loader during the berthing operation during which the ship was pushed, roughly parallel, towards the berth by tugs. 216 The documentation referred to by the primary judge at [451] to [453] of his reasons made clear the currency of the procedures. 217 The primary judge found that the usual practice was to park the loader not at the geographic centre of the berth but "where the parallel part of a cape size vessel will come into contact with the fenders": [461] of his reasons. 218 In [462] of his reasons, the primary judge described where the No 1 loader was parked - between the second and third fenders marked on the diagram below that paragraph (being the left-hand shaded rectangle). If the loader had been parked at the centre of the berth it would have been placed where the right-hand shaded rectangle appears. 219 If the No 1 loader had been parked at the centre of the berth it would not have been damaged in this incident. Therefore, it was said, the failure to follow the operating procedures was contributory negligence for which allowance should have been made. 220 The primary judge rejected this claim for contributory negligence because of a perceived absence of causal relationship between the conduct said to be negligent and the loss or damage. In our view, the primary judge was correct so to conclude. 221 Braverus criticised the primary judge for his focus on causation. That criticism was misplaced. Section 9 of the Law Reform (Miscellaneous Provisions) Act 1965 (NSW), picked up by s 79 of the Judiciary Act 1903 (Cth) in a matter in the exercise of federal jurisdiction, provided as follows: (1) If a person (the "claimant") suffers damage as the result partly of the claimant's failure to take reasonable care ("contributory negligence") and partly of the wrong of any other person:

(a) a claim in respect of the damage is not defeated by reason of the contributory negligence of the claimant, and

(b) the damages recoverable in respect of the wrong are to be reduced to such extent as the court thinks just and equitable having regard to the claimant's share in the responsibility for the damage.

(2) Subsection (1) does not operate to defeat any defence arising under a contract. (3) If any contract or enactment providing for the limitation of liability is applicable to the claim, the amount of damages recoverable by the claimant by virtue of subsection (1) is not to exceed the maximum limit so applicable. [emphasis added] 222 The words "as the result" in s 9(1) plainly import the notion of causation. See also Caswell v Powell Duffryn Associated Collieries Ltd [1940] AC 152 at 165. 223 His Honour dealt with the causation question at [478] to [482] of his reasons as follows: However, the strategy of locating the loaders at the centre of the berth when a vessel such as the Fortius is berthing is intended to guard against the risk of angularity arising as the vessel, when parallel to the berth, is pushed into the berth by the tugs. Consideration of the potential adverse angles of approach of the range of vessels likely to use the berth is an important parameter in the design of a berth. Mr MacKnight agreed that a berth and the facilities on the berth are never designed to take account of a vessel hitting the berth at an angle close to 90 degrees, because that would be so outside the parameters of what would be normal that it would be fanciful to seek to design a berth for that eventuality. The fender system, for example, is not designed to cater for that eventuality. Mr Oram was of a similar view. Commonly, in Mr MacKnight´s experience, the angle of approach for a vessel in a harbour such as Port Kembla would rarely exceed 5-6 degrees. The circumstances in which the Fortius collided with CB2 on 15 April 2002 were outside the class of risk against which a sound strategy for loader placement is designed to afford protection. The Fortius never completed its swing, nor did it get into a position parallel to the berth from which the tugs could push it in to the berth. In the circumstances as they existed prior to the collision, the coal loaders were at risk wherever they were placed on the berth. It was a matter of mere chance as to where a vessel manoeuvring so far outside the norm would hit the wharf. There is no evidentiary foundation for a conclusion that it was less likely that the Fortius would strike the centre of the berth rather than some other point on the berth. Had the loaders been placed on the maintenance bays (the least safe part of the berth in the context of a berthing operation), they would not have been damaged. The requisite causal link between the damage to the coal loaders and the plaintiff´s negligence is therefore lacking. It is the issue of causation which distinguishes this case from the Southampton Container Terminals Ltd v Hansa Schiffartsgesellschaft mbH [1999] 2 Lloyd´s Rep 491 (The Maersk Colombo´ ). Causation questions involve value judgments. Whilst it is true to say that the No 1 loader would not have been damaged had it been placed at the centre of the berth, in the circumstances of this case that is entirely fortuitous. The commonsense test of causation is a two stage process. In F Trindade & P Cane, The Law of Torts in Australia, OUP, 3rd Ed, 1999, the authors state (at 565) that the negligence must be a factual cause of the loss and must also be a legal or attributative cause of the damage. Foreseeability is relevant to legal causation but is not decisive of it. The authors give the following example (at 565): In Jones v Livox Quarries[[1952] 2 QB 608] Denning LJ said [ at 616] that the negligence of the plaintiff in riding on the tow-bar of a vehicle would be a cause of injury to P whether P was thrown off the tow-bar or crushed when another vehicle collided with it. But there would be no (attributive) causal link between P´s injuries and P´s negligence if P was shot by a negligent sportsman, and the bullet would not have hit P if P had been in the cab rather than on the tow-bar.´ In Jones v Livox Quarries [1952] 2 QB 608, Singleton LJ said (at 614): `If [the plaintiff] unreasonably, or improperly, exposed himself to this particular risk, I do not think that he ought to be allowed to say that it was not a cause operating to produce the damage, even though one may think that the prohibition against riding on the vehicle was not made with that particular risk in mind.´ (emphasis added) But here parking the loaders otherwise than in the centre of the berth only exposed the loaders to an increased risk of damage in the context of a vessel being pushed by the tugs up to the face of the berth. The collision with the berth on this occasion occurred at an anterior stage in the berthing process. The link between the exacerbated risk and the damage was therefore not sufficiently close to render one causative of the other. 224 We agree. The risk against which the procedures were directed arose from the exercise of berthing, by the ship moving roughly parallel towards the berth pushed by the tugs. The procedures in question had absolutely nothing to do with any risk of damage from a ship hitting the berth having misjudged the swing. The swing was a task undertaken before the ship was pushed towards the berth. Indeed, the safest place, logically, to park the coal loader to avoid damage from a collision arising from an uncontrolled or badly effected swing, such as here, is as far north along the berth as one can park the loader. But, on the evidence, that was the most dangerous place to park the coal loader during berthing when the ship is being pushed north and east by the tugs. 225 Also, if the Fortius had been swung without incident there would have been ample time to move the coal loader to the centre of the berth for the berthing operation. 226 There was nothing inconsistent in the primary judge's approach with Astley v Austrust Limited (1999) 197 CLR 1 or March v E & MH Stramare Pty Limited (1991) 171 CLR 506. To the contrary, the common sense notions of causation referred to in those cases pick up, necessarily, the notion of the relevant risk. The plaintiff's conduct did not expose it to any greater risk of damage to this kind of event. 227 Braverus sought to use two passages in Astley v Austrust Ltd to support the proposition that the primary judge erred in applying notions of causation to the analysis. In that case, Gleeson CJ, McHugh J, Gummow J and Hayne J said the following at [21] and [30], respectively. At common law, contributory negligence consists in the failure of a plaintiff to take reasonable care for the protection for his or her own property. … A person may also be guilty of contributory negligence even though the negligence of the plaintiff did not contribute to the accident which caused the damage. This is because contributory negligence is concerned with the failure of the plaintiff to protect his or her person or property against damage and not with whether the failure contributed to the accident. … A finding of contributory negligence turns on a factual investigation of whether the plaintiff contributed to his or her own loss by failing to take reasonable care of his or her person or property. What is reasonable care depends on the circumstances of the case. [emphasis in original] 228 Their Honours were not saying that a causal relationship between the conduct and the damage was not required. Plainly it is by the terms of the legislation. Rather they were saying that it is unnecessary that the conduct contribute to the accident. The plaintiff's conduct here did not contribute to the accident which was the collision of the moving Fortius with the stationary berth and machinery there and the lack of care of the pilot and the master on board. The submission of Braverus misconceives what their Honours were saying in those passages. 229 It is to be conceded that one needs to be careful in the above analysis not to analyse the risk too finely; but it is plain here that the position of the loader on the berth had no bearing whatsoever on the chance of the loader being hit during a badly executed swing. Jones v Livox Quarries [1952] 2 QB 604 relied on by Braverus can be distinguished, as the primary judge did. It is plain that the event which occurred there was within the penumbra of danger to which the precautions were directed, though of a slightly different kind to those which caused the precaution to be required. 230 The relationship of the conduct to the nature of the risk is fundamental to causation: Chappel v Hart (1998) 195 CLR 232 at 244-5 and 289-90; Naxakis v West General Hospital (1999) 197 CLR 269 at 278-79 and 312; Chester v Afshar [2005] 1 AC 134 at [9], [21], [36], [73] and [94]-[95]; and see Glanville Williams Joint Torts and Contributory Negligence (1951) pp 366-67 discussing Smithwick v Hall & Upson Co 59 Conn 261, 21 Atl Rep 924 (1890). 231 Here, there was simply no common sense link between the conduct and the risk in question. 232 On the basis of the correctness of the primary judge's view about contributory negligence his approach to costs cannot be, and was not, criticised.

Conclusion 233 For these reasons the appeals should be dismissed with costs. I certify that the preceding two hundred and thirty-three (233) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Tamberlin, Mansfield & Allsop .

Associate: Dated: 12 December 2005 Counsel for the Appellant: S D Rares SC and A S Bell

Solicitor for the Appellant: Ebsworth & Ebsworth

Counsel for the First Respondent: A J Sullivan QC and G J Nell

Solicitor for the First Respondent: Blake Dawson Waldron

Counsel for the Second Respondent: J E Sexton SC and G K J Rich

Solicitor for the Second Respondent: Thynne & Macartney

Dates of Hearing: 15, 16, 17, 18 and 19 August 2005

Date of Judgment: 12 December 2005

Marine Pilotage Licensing Act 1971(NSW)

Ports Corporatisation and Waterways Management Act 1995(NSW)ss 85

Trade Practices Act 1974(Cth)

Navigation Act 1958(Cth)

Power and Water Authority Act 1987(NT)

Braverus Maritime Inc v Port Kembla Coal Terminal Ltd [2005] FCAFC 256

ADMIRALTY AND MARITIME - SHIPPING AND NAVIGATION - compulsory pilotage - construction and interpretation of s 410B of Navigation Act 1912 (Cth) and ss 85 and 86 of the Ports Corporatisation and Waterways management Act 1995 (NSW) - shipowner liable for fault of pilot, though pilot not properly licensed. TRADE PRACTICES ACT - no reliance by master of ship on conduct of the pilot CONTRACT - formation - no contract between shipowner and pilotage service provider TORT - contributory negligence - no relevant causal link between conduct of the plaintiff and the damage Law Reform (Miscellaneous Provisions) Act 1965 (NSW) s 9 Law Reform (Vicarious Liability) Act 1983 (NSW) Marine Pilotage Licensing Act 1971 (NSW) Navigation Act 1912 (Cth) s 410B Pilotage Act 1913 (Imp) s 15(1) Ports Corporatisation and Waterways Management Act 1995 (NSW) ss 85 and 86 State Owned Corporations Act 1989 (NSW) s 20E Airways Corporation of New Zealand Ltd v Geyserland Airways Ltd [1996] 1 NZLR 116 discussed Amarantos Shipping Co Ltd v South Australia (2004) 89 SASR 438 referred to Astley v Austrust Limited (1999) 197 CLR 1 discussed Australian Woollen Mills Pty Ltd v Commonwealth (1954) 92 CLR 424 applied Bropho v Western Australia (1990) 171 CLR 1 applied Bunbury-Harvey Regional Council v Giacci Bross Pty Ltd (2000) 117 LGERA 1 discussed Caswell v Powell Duffryn Associated Collieries Ltd [1940] AC 152 referred to Chappel v Hart (1998) 195 CLR 232 referred to Chester v Afshar [2005] 1 AC 134 referred to CIC Insurance Ltd v Bankstown Football Club Ltd (1995) 187 CLR 384 applied Commercial Union Assurance Company of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389 referred to Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594 referred to Director of Posts & Telegraphs v Abbott (1974) 7 SASR 540 referred to Dudman v Brown and Dublin Port and Docks Board (1873) IR Rep 7 CL 518 referred to Eastman v Director of Public Prosecutions of the Australian Capital Territory (2003) 214 CLR 318 applied Fowles v The Eastern and Australian Steamship Company Ltd (1913) 17 CLR 149 discussed General Steam Navigation Company v British Colonial Steam Navigation Company (1869) LR 4 Ex 238 referred to Holman v Irvine Harbour Trustees (1877) 4 Sess Cas (4th Ser) 406 discussed and distinguished Jones v Livox Quarries [1952] 2 QB 608 referred to K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 157 CLR applied Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 applied Laugher v Pointer (1826) 5 B & C 547; 108 ER 204 referred to Lismore City Council v Stewart (1989) 18 NSWLR 718 referred to Lucey v Ingram (1840) 6 M & W 302; 151 ER 424 referred to March v E & MH Stramare Pty Limited (1991) 171 CLR 506 referred to Mersey Docks and Harbour Board v Coggins and Griffith (Liverpool) Ltd [1947] AC 1 referred to Milligan v Wedge (1840) 12 Ad & E 737; 113 ER 993 referred to Milliman v Rochester Railway Co 39 NYS 274 (1896) referred to Naxakis v West General Hospital (1999) 197 CLR 269 referred to Network Ten Pty Ltd v TCN Channel Nine Pty Ltd (2004) 217 CLR 273 applied Newcastle City Council v GIO General Ltd (1997) 191 CLR 85 applied Norweb Plc v Dixon [1995] 1 WLR 636 referred to NT Power Generation Pty Ltd v Power and Water Authority (2004) 210 ALR 312 applied Oceanic Crest Shipping Co v Pilbara Harbour Services Proprietary Limited (1986) 160 CLR 626 discussed and applied Parker v North British Rail Co (1898) 25 Ct of Sess Cas, 4th Ser 1059 referred to Pfizer Corporation v Ministry of Health [1965] AC 512 referred to Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 applied Prowse v European and American Steam Shipping Co (1860) 13 Moore 484; 15 ER 182 Puntoriero v Water Administration Ministerial Corporation (1999) 199 CLR 575 referred to RW Miller & Co v Shortland CC (1988) 83 ALR 225 referred to Shaw, Savill & Albion Co v Timaru Harbour Board (1890) 15 App Cas 429 referred to Smithwick v Hall & Upson Co 59 Conn 261, 21 Atl Rep 924 (1890) referred to Stevens v Kabushiki Kaisha Sony Computer Entertainment (2005) ALR applied Suatu Holdings Pty Ltd v Australian Postal Corporation (1989) 86 ALR 532 referred to The 'Adam W Spies' (1901) 70 LJ (P) 25 discussed The 'Annapolis' (1861) Lush 295 at 312; 167 ER 128 referred to The 'Beechgrove' [1916] 1 AC 364 discussed The 'Cavendish' [1993] 2 Lloyd's Rep 292 discussed The 'Eden' (1846) 2 W.Rob 442; 166 ER 822 discussed The 'Guy Mannering' (1882) 7 PD 132 discussed The 'Halley' (1868) LR 2 PC 193; 5 Moore NS; 16 ER 514 discussed The 'Hector' (1883) 8 PD 218 referred to The 'Lion' (1869) LR 2 PC 525 referred to The 'Maria' (1839) 1 W. Rob 96; 166 ER 508 discussed The 'Neptune the Second' (1814) 1 Dods 437; 165 ER 1380 referred to Thom v J & P Hutchison Ltd 1925 SC 386 discussed Townsville Harbour Board v Scottish Shire Line Ltd (1914) 18 CLR 306 discussed Workington Harbour and Dock Board v Owners of 'Towerfield' [1949] P 10 (Court of Appeal); and[1951] AC 112 (House of Lords). discussed Douglas & Geen on the Law of Harbours, Coasts and Pilotage (5th Ed 1997) Glanville Williams Joint Torts and Contributory Negligence (1951) Glass H, McHugh M and Douglas F The Liability of Employers (Law Book Co 2nd Ed) BRAVERUS MARITIME INC v PORT KEMBLA COAL TERMINAL LTD AND ANOR NSD 1755 of 2004 TAMBERLIN, MANSFIELD & ALLSOP JJ SYDNEY 12 DECEMBER 2005

At a glance

Court

Decision date

Source

Judgment (60 paragraphs)

Parties

Legislation Cited (12)

Cases Cited (32)