DC v State of New South Wales

tate of New South Wales [2009] NSWSC 297 DC v New South Wales [2010] NSWCA 15 Farnell v Bowman (1887) 12 App Cas 643 Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 Graham Barclay Oysters Pty Ltd v Ryan [2002] HCA 54; (2002) 211 CLR 540 Leotta v Public Transport Commission of NSW (1976) 50 ALJR 666 M v The Queen [1994] HCA 63; (1994) 181 CLR 487 Maguire v Simpson (1977) 139 CLR 362 Malec v JC Hutton Pty Ltd [1990] HCA 20; (1990) 169 CLR 638 Michael v The Chief Constable of South Wales Police [2015] UKSC 2 Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; [2000] HCA 61 Nicholson v Nicholson (1994) 35 NSWLR 308 Petchell v Du Pradal [2015] QCA 132 Purkess v Crittenden [1965] HCA 34; (1965) 114 CLR 164 Pyrenees Shire Council v Day (1998) 192 CLR 330; [1998] HCA 3 Roads and Traffic Authority of NSW v Dederer [2007] HCA 42; (2007) 234 CLR 330 Robinson Helicopter Company Inc v McDermott [2016] HCA 22 Romeo v Conservation Commission of the Northern Territory (1998) 192 CLR 431; [1998] HCA 5 Seltsam Pty Limited v Ghaleb [2005] NSWCA 208; 3 DDCR 1 State of New South Wales v Burton [2006] NSWCA 12 State of New South Wales v Burton [2008] NSWCA 319 Stuart v Kirkland-Veenstra [2009] HCA 15; (2009) 237 CLR 215 Sullivan v Moody (2001) 207 CLR 562; [2001] HCA 59 Tabet v Gett [2010] HCA 12; (2010) 240 CLR 537 TB v State of New South Wales [2009] NSWSC 326 TB v State of New South Wales and Quinn; DC v State of New South Wales and Quinn [2015] NSWSC 575 TC v State of New South Wales [2001] NSWCA 380 Van Colle v Chief Constable of the Hertfordshire Police; Smith v Chief Constable of Sussex Police [2009] AC 225 Wallace v Kam [2013] HCA 19; 250 CLR 375 Watts v Rake [1960] HCA 58; (1960) 108 CLR 158 X (Minors) v Bedfordshire County Council [1995] 2 AC 633 Texts Cited: Harold Luntz, Assessment of Damages for Personal Injury and Death (4th ed, 2003, LexisNexis Butterworths) Category: Principal judgment Parties: DC (First Appellant) TB (Second Appellant) State of New South Wales (Respondent) Representation: Counsel: A S Morrison SC with K Pryde and N Morrissey (Appellants) Ms P Wass SC with I Harvey (Respondent)

Solicitors: Graham Jones Lawyers (Appellants) Crown Solicitor's Office (Respondent) File Number(s): 2015/00176396 Publication restriction: Restriction on identification of appellants Decision under appeal Court or tribunal: Supreme Court of New South Wales Jurisdiction: Common Law Division Citation: [2015] NSWSC 575 Date of Decision: 22 May 2015 Before: Campbell J File Number(s): 2008/00289325; 2008/00289326

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

HEADNOTE [This Headnote is not to be read as part of the judgment] The appellants, DC and TB, are sisters who, as children, suffered ongoing sexual and physical abuse by their stepfather. They commenced proceedings against the State of New South Wales and Ms Quinn, a case officer with what was then the Department of Youth and Community Services (the Department), claiming damages for the alleged breach of a duty of care owed to them. An extension of the limitation period was granted for the bringing of those claims. The claims relate to a period of a few months commencing from the time TB first complained of the abuse to the Department in April 1983. The appellants contended that the Department breached its duty by not reporting the abuse to the police and that, had it done so, they would have been protected from the possibility of any further abuse on the basis that the step-father would have been charged. In 2001, the appellants reported the abuse to the police. After the commencement of the criminal trial in 2005, the stepfather pleaded guilty to nine charges. At the time of the abuse, the powers and obligations of the Department's officers were governed by the Child Welfare Act 1939 (NSW). Under s 148B of that Act, on notification to the Director of certain matters involving the abuse or neglect of children, the Director was required to cause an investigation to be undertaken. Where satisfied that abuse had occurred, reporting to police was a possible but not mandatory course of action. At trial, the appellants argued that the duty of care owed to them by the Department extended to a requirement that their complaints should have been reported to the police, pursuant to the power conferred on the Director by s 148B(5) of the Child Welfare Act. The State did not contend that the statutory power relied upon (s 148B(5)) had not been engaged in the present case and conceded that it owed a common law duty to exercise its statutory powers with reasonable care, but disputed that the duty extended to a duty to report the abuse to the police, argued for a finding that the abuse had been reported, and denied that any abuse had occurred in the post-April 1983 period. The primary judge gave judgment in favour of the State and Ms Quinn. His Honour found that the Department owed each of the appellants a duty to use reasonable care in the exercise of its powers under s 148B(5) of the Child Welfare Act, that the scope of that duty included a duty to report the abuse to the police, and that the complaints had not been so reported; but was not satisfied that the step-father had, on the balance of probabilities, continued to abuse the appellants in the period after complaint was made to the Department. The claim against Ms Quinn failed on the basis that she owed no duty in relation to the s 148B(5) powers and that, even if she did, she had discharged that duty. His Honour made contingent findings as to the damages he would have awarded had he given judgment for the appellants, applying a discount of 70% on account of pre-notification abuse (for which the Department had no legal responsibility). On appeal, the appellants challenged the factual finding that the abuse did not continue after the complaint to the Department. There was no challenge to the findings in relation to Ms Quinn and she was not a party to the appeal. By way of notice of contention, the State challenged his Honour's findings as to the scope and content of the duty, namely that the duty encompassed an obligation to report the abuse to the police. The State accepted that, if the appellants succeeded in establishing liability, no challenge was made to the allowance of 30% of the total loss as their damages. Held, allowing the appeal by majority: per Ward JA (Sackville AJA agreeing at [373]): (1) The primary judge's finding that the abuse had not continued post-April 1983 was based largely, if not wholly, on the lack of a report of such abuse in the contemporaneous documentation rather than on the credibility of the respective witnesses. Hence the appellate restraint mandated in this regard by Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 does not preclude an assessment by this Court of the documentation on which his Honour relied in coming to that conclusion. Taking all the evidence together, the abuse continued in the period after April 1983: [179], [242], [253]. (2) The duty of care owed to the appellants was a duty in the exercise of the statutory powers under the Child Welfare Act to take all reasonable steps in the circumstances of the appellants' case to protect them from the risk of further physical and sexual abuse and notification of the abuse to the police was required in order to satisfy this duty: [275]-[276]. (3) The primary judge did not err in concluding that, had there been further ongoing abuse in the period post-April 1983, this would have made a material contribution to the appellants' harm: [349]. (4) Having regard to the position adopted by the parties on the appeal, there should be an award of damages in favour of each of the respective appellants as provisionally assessed by the primary judge: [181]; [357]. per the Court: (5) By Ward JA (at [322]), (Basten JA (at [96]) and Sackville AJA (at [373]) agreeing), the primary judge did not err in finding that the complaints of abuse against the step-father were not reported to the police. per Basten JA (in dissent): (6) The scope of the duty of care owed to the appellants by the State through its officers in the Department, was to take reasonable steps in exercising statutory powers to protect victims of child abuse; it did not extend to an obligation to report to police the allegations of criminality. The powers conferred by s 148B to report to police were discretionary and their primary statutory purpose was child protection; not prosecution: [79]; [81]; [93]. (7) The primary judge did not err in failing to be satisfied as to the continuation of the abuse on the evidence before him. His Honour's conclusion that the abuse did not continue after complaint to the Department were based on credibility findings with respect to DC, TB and Ms Quinn; there is nothing to suggest that those findings were erroneous on any of the bases identified in Fox v Percy [2003] HCA 22; (2003) 214 CLR 118: [8]; [151]-[152]. (8) In the absence of any finding of ongoing abuse after the complaints were made, the officers in the Department were not in breach of their duty of care to the appellants: [159]. (9) It was arguable that s 148B(5) was not engaged at all because this case was not concerned with a "notification" of child abuse and there was no evidence as to the state of satisfaction of the Director. However, as the State did not dispute that s 148B(5) was engaged, the case cannot be determined on those grounds: [93] (obiter).

Judgment INDEX BASTEN JA 1 A Introduction 2 B Scope of duty of care (1) The pleaded duty 12 (2) Findings of trial judge 23 (3) State's contention on appeal 26 (4) Principles for determining scope of duty 32 (a) statutory context - Child Welfare Act 33 (b) reliance on inter-departmental guidelines 56 (c) general principles 62 (d) operation of the Civil Liability Act 77 (5) Scope of duty - application of principles (a) did the duty encompass an obligation to report to police 79 (b) what triggered the duty? 87 (c) error in judgement at trial 88 (6) Scope of duty - conclusions 93 C Breach of duty (1) Finding of breach by State 96 (2) Finding of no negligence by Ms Quinn 102 (3) Negligence of other officers 120 (4) Did the abuse continue after complaint to YACS? (a) whether complaints of on-going abuse 133 (b) continuing abuse of TB 138 (c) continuing abuse of DC 143 (d) no basis for interference 150 D Damages 153 E Conclusions 159 WARD JA: 161 Appeal 176 Additional Background 182 Proceedings 207 Grounds 1-15 of the grounds of appeal - finding that sexual abuse did not continue after notification to Department of abuse in April 1983 217 Relevant Findings 218 Appellants' submissions 230 Respondent's submissions 238 Determination 241 Notice of Contention 255 Relevant Findings 256 Ground 1 of the notice of contention - whether duty of care required report to the CMU/police 266 Determination 270 Grounds 2 and 3 of the notice of contention - breach of duty 277 Relevant Findings 278 Respondent's submissions 284 Appellants' submissions 316 Determination 318 Grounds 16 and 17 of the grounds of appeal - damages 329 Relevant findings 331 Appellants' submissions 332 Respondent's submissions 338 Supplementary submissions as to damages 342 Non-economic loss 344 Interest on past loss of superannuation 346 Interest on past out of pocket expenses 347 Determination 349 Orders 372 SACKVILLE AJA: 373 The Civil Liability Act 375 The Post-April 1983 Abuse 378 The State's Liability for Damages 388 Additional Observations 404

A INTRODUCTION

1. The appellants are two women who, as young girls, suffered appalling sexual abuse at the hands of their stepfather, LX. Their entitlement, both moral and legal, to substantial compensation for the very serious psychiatric harm done to them, is undeniable. However, this was not a claim against the tortfeasor whose conduct directly caused the harm; rather, it was brought against the State for failing to prevent the criminal acts of another person. Thus the appellants lodged claims against the State of New South Wales and Carolyn Quinn, a district officer in the Department of Youth and Community Services. The allegation on which the claims were founded was that the second defendant, Ms Quinn, while taking appropriate steps to protect the appellants under the child welfare legislation, failed to report the conduct to the police. The legal question is at what point did the failure of officers in the employ of the State who were actively seeking to protect the claimants result in the State bearing the liability for any ongoing abuse?
2. There were numerous difficulties which confronted the appellants in pursuing these claims. First, they did not commence proceedings until 2008, 24 years after the conduct in question terminated. They required a lengthy extension of time, which was granted. Nevertheless, that lapse of time affected the available evidence. Records which would have been available at an earlier point in time are not available; memories have deteriorated.
3. Secondly, the abuse relied upon occurred within a period of a few months, the precise period differing in respect of each appellant. Whether any abuse took place in that period was itself contested. The relevant period commenced no earlier than the first complaint to the then Department of Youth and Community Services (YACS) and concluded less than a year later. However, the first sexual assault on TB had occurred more than eight years earlier, when she was seven and a half years old. The first assault on DC occurred some six months after the first assault on TB, when DC was four years old. The assaults included penile/vaginal intercourse and fellatio. The fact that the children suffered shocking abuse for many years and at such young ages made it difficult for them to establish that any identifiable part of the psychiatric harm suffered resulted from the abuse which occurred after the conduct of the stepfather was drawn to the attention of the welfare authorities.

(1) The pleaded duty

1. Although the principal ground of appeal challenged the factual finding that the abuse did not continue after the complaints to YACS, it is logical to commence with the State's contention that the trial judge erred in finding that its duty of care extended to reporting the complaints of abuse to the police.
2. The scope of any duty of care owed to the appellants must be identified at a level of generality consistent with the need for it to arise prospectively and not retrospectively in the light of the deleterious consequences suffered by the appellants. Nevertheless, any formulation, particularly in circumstances where the conduct of the respondents derives from the exercise of, or failure to exercise, statutory powers, must relate specifically to the nature of the power and the circumstances in which it is engaged.
3. It is also necessary to be precise as to the duty owed by the respondent. While the claim against Ms Quinn failed on the basis that she did not breach any duty of care, a finding not challenged on the appeal, the basis of the proposed liability of the State must be articulated.
4. The statement of claim alleged both that the State itself owed the appellants a duty, and that it was vicariously liable for the negligence of officers in YACS. The direct duty was based upon "the relationship" between the State and each appellant, which was described as "close" and envisaged the State "considering the conduct of [LX]." [3] It alleged numerous particulars of both defendants' "awareness" of the circumstances of the complainants. [4] However, the legal basis for a direct duty owed by the State was not identified. The State is a juristic person, but, like a corporation, it will act through individuals and its "awareness" of facts will derive from that of its officers. No statute or common law principle was identified which imposed duties on the State, as an entity. While the State was sued pursuant to s 5(2) of the Crown Proceedings Act 1988 (NSW), neither that section nor its predecessors created a cause of action. [5]
5. Almost identical allegations were made with respect to Ms Quinn, which involved at least an implicit acknowledgment that it was the knowledge and actions of a public officer which lay at the heart of the liability of the State. It was otherwise inherently implausible that a junior public employee would have the same legal status and obligations as the State. [6] Indeed, the trial judge, in dismissing the claim against Ms Quinn, expressly so concluded. [7]

(2) Findings of trial judge

1. The claimants' case at trial was that the duty of care owed to them by officers in YACS extended to a requirement that their complaints about LX should have been reported to police, pursuant to the power conferred on the Director by s 148B(5). The trial judge accepted that submission, holding: [9] "The Department owed each of TB and DC a duty actionable under the law of negligence to use reasonable care in the exercise of its powers conferred by s 148B(5) [of the Child Welfare Act]."
2. The trial judge correctly distinguished the position of Ms Quinn, stating: [10] "As the evidence in the case makes clear, the District Officer was a relatively junior and young officer accountable in the performance of her duties to the senior officers to whom she reported. It may have fallen to her to implement appropriate action under s 148B(5)(b), but she was not legally responsible for the exercise of the statutory power, or discretion. It is not appropriate to impute the duty owed by the Department, concurrently to the District Officer."
3. At no stage did the trial judge find that the State owed a direct duty of care to the appellants. The absence of such a finding was not challenged on the appeal and, as noted above, the existence of such a duty was at least legally implausible. Further, Ms Quinn was not joined as a party to the appeal and there was no challenge to the finding that she did not owe a duty of care. It follows that the appeal must be assessed on the basis that the State was vicariously liable for negligence of other officers in YACS.

(3) State's contention on appeal

1. On appeal the State filed a notice of contention in the following terms: "In the context of an initial finding that the respondent had a legal duty to take reasonable care in the exercise of its statutory powers, his Honour … erred in finding that the common law imposed a duty on the respondent to report a matter of child abuse to the NSW Police Child Mistreatment Unit (CMU)."
2. The appellants understood the State's position as follows: [11] "There is no challenge to his Honour's finding that the Respondent owed each Appellant a common law duty to take reasonable care in the exercise of its statutory powers. The challenge is to the content of the duty."
3. That the State conceded that it owed a duty of care to children in respect of whom protection was sought, to exercise its statutory powers with reasonable care, is unsurprising. The distinction between that concession and the challenge to the alleged scope of the duty is important and reflected in the authorities. For example, in Roads and Traffic Authority of New South Wales v Dederer [12] there was no dispute that the RTA owed a duty of care to all members of the public in the exercise of its bridge building functions. [13] The critical question was, as often in relation to claims against statutory authorities, not whether a duty was owed, but rather the scope of the duty. As Gummow J explained in Dederer, duties of care are not owed in the abstract, but are "obligations of a particular scope, and that scope may be more or less expansive depending on the relationship in question." [14]
4. Similar reasoning may be found in many judgments in many cases. Kirby J stated in Romeo v Conservation Commission of the Northern Territory: [15] "[122] It is one thing to hold that a person owes a duty of care of some kind to another. But the critical question is commonly the measure or scope of that duty. The failure to distinguish these concepts can only lead to confusion. [123] The ordinary formulation of the common law is that a body such as the Commission must take reasonable care to avoid foreseeable risks of injury to persons entering an area such as the reserve, including the cliffs, as of common right. [16] However, that expression of the duty must be elaborated if it is to be of any practical guidance."
5. Hayne J, in Romeo, also spoke in emphatic terms: [17] "It was not (and could not be) seriously suggested that the respondent in this case owed no duty of care to members of the public that might go to areas which it manages. The real subject for debate was what that duty required of it, for it is only when the content or scope of the duty is identified that questions of breach and causation of damage can be considered."

(4) Principles for determining scope of duty

1. In these circumstances, it is necessary to consider the nature and scope of the "common law duty" conceded to be owed by officers of the State attaching to the exercise of specific "statutory powers", for breach of which it would bear vicarious liability. The starting point for this exercise must be the identification of the statutory power relied upon by the appellants. There are reasons for doubting the assumption that s 148B(5), was engaged, or that it envisaged reporting to police for the purposes of prosecution, rather than the carrying out of functions under the Child Welfare Act itself. As neither of these points of statutory construction was relied on by the State, the case cannot be determined on these grounds. However, because the scope of the common law duty depends on the purpose of the statutory power it is necessary to have regard to the operation of the Child Welfare Act.

(a) statutory context - Child Welfare Act

1. The Child Welfare Act reflected a philosophy which has long since been abandoned. Part XIV was headed "Committal of Neglected or Uncontrollable Children or Young Persons [18] or of Juvenile Offenders." (Parental neglect and offences by a child were rolled up in one Part.) Pursuant to s 76, an officer authorised by the Minister, or a police constable, was empowered to apprehend a child "who he has reason to believe is a neglected or uncontrollable child". The term "uncontrollable" meant a child "who is not being or cannot be controlled by his parent or by any person having his care." [19] The definition of "Neglected child", contained in s 72, ran to 16 paragraphs. It included the following: (g) whose parents are drunkards, or, if one be dead, insane, unknown, undergoing imprisonment, or not exercising proper care of the child …, whose other parent is a drunkard; or … (j) who in the opinion of the court is under incompetent or improper guardianship; or … (l) whose parents are unfit to retain the child … in their care…; or … (n) who is falling into bad associations or is exposed to moral danger ….
2. There was power for a justice to issue a warrant for the apprehension of a child or young person where an authorised officer or constable of police, "having made due inquiry,… believes any child … to be a neglected or uncontrollable child". [20] A child apprehended pursuant to such a warrant was to be taken to a shelter and, as soon as practicable thereafter, brought before a court. [21] The court was given power in the following terms: 82. (1) If a court finds that a child … is a neglected or uncontrollable child … it may‑ (a) admonish and discharge the child …; or (b) release the child … on probation upon such terms and conditions as may be prescribed or as the court may, in any special case, think fit, and for such period of time … as the court may think fit; or (c) commit the child … to the care of some person who is willing to undertake such care upon such terms and conditions as may be prescribed or as the court may, in any special case, think fit, and for such period of time … as the court may think fit; or (d) commit the child … to the care of the Minister to be dealt with as a ward admitted to State control; or (e) commit the child … to an institution, either generally or for some specified term … not exceeding three years. (2) If a court finds that a child is a neglected child it may release the child‑ (a) upon such terms and conditions as the court may think fit and as are willingly undertaken to be observed by the child's parents, one of the child's parents or another person approved by the court; and (b) for such period of time … as the court may think fit.

(b) reliance on inter-departmental guidelines

1. The claimants, both at trial and in this Court, sought to obtain assistance in formulating the duty of care by reliance on a document entitled "Guidelines for Officers of the Department of Youth and Community Services, the Police Department and the Health Commission in respect of matters relating to child abuse". The trial judge inferred that the Guidelines had been adopted no later than 26 February 1982. [33] The judge considered the Guidelines in the course of determining whether the abuse was in fact reported to police. The Guidelines, quite properly, played no part in his consideration of whether there was a duty of care which extended to an obligation to report the sexual abuse to the police. [34] However, because the appellants in this Court placed some reliance on the Guidelines as forming the basis for submissions as to the scope of the duty of care, it is necessary to indicate why they provide no support for that conclusion.
2. Emphasis was placed upon the first paragraph in Part 1 of the Guidelines, dealing with "receipt of notifications of suspected child abuse", which read as follows: "All notifications of suspected child abuse are to be reported to any District Office or Child Protection Unit of the Department of Youth and Community Services. The Officer-in-Charge of such office is to ensure that Montrose Child Protection and Family Crisis Service is immediately notified of details of the reported case."
3. The Montrose Service was part of YACS. It maintained a register of child abuse complaints, until the children concerned came of age. Part 3 of the Guidelines was headed "Discretion". It contained two parts, the first dealing with YACS and the second with the Police Department. With respect to YACS, the Guidelines addressed four activities of identified officers in YACS, including (1) the issue of medical examination orders under s 148C of the Child Welfare Act, (2) a decision to lay a complaint under the Child Welfare Act, (3) a decision to involve police in child abuse cases and (4) a decision to "file down" registered child abuse cases.
4. The trial judge concluded, having regard to the elements identified in (3), that the cases of the complainants fell within the category of cases which would be "appropriate" for involvement of the police. However, importantly for present purposes, that section of the Guidelines contained the following statement: "Police involvement is not synonymous with court action which should be the result of a joint decision making process between responsible officers of [YACS], police personnel and health personnel if involved."

(c) general principles

1. In assessing whether the common law would impose a duty in these circumstances, it is necessary to have regard to two basic principles. First, absent a special relationship involving a duty to control the actions of another, the common law does not generally impose a duty of care on one person to prevent a second person causing harm to a third person. [35] Secondly, the common law will not impose a duty which is "inconsistent with, or have a tendency to discourage, the due performance by the [relevant authority] of its statutory duties". [36] Nor will it require that a discretionary power conferred by statute be exercised in a particular way. In the case of a statutory power the duty will usually be to consider its exercise, if the preconditions are satisfied.
2. The first principle was addressed in a case involving the management of licensed premises, namely Adeels Palace Pty Ltd v Moubarak. [37] The question was whether the proprietor of licensed premises owed a customer a duty to take reasonable care to prevent injury resulting from the violent conduct of others on the premises. In rejecting a submission that Modbury Triangle precluded such a duty of care, the High Court noted that "the particular duty said to have rested on the occupier of the premises (who was the operator of the business that was conducted on the premises) is a duty to take reasonable care to prevent or hinder the occurrence of events which, under the Liquor Act, the licensee was bound to prevent occurring - violent, quarrelsome or disorderly conduct." [38] The existence of such a duty, in relation to event which occurred on New Year's Eve, was expressed in the following terms: [39] "In the circumstances reasonably to be contemplated before the restaurant opened for business on 31 December 2002 as likely to prevail on that night, Adeels Palace owed each plaintiff a duty to take reasonable care to prevent injury to patrons from the violent, quarrelsome or disorderly conduct of other persons. The duty is consistent with the duty imposed by statute upon the licensee and which was a duty enforceable by criminal processes. No question arises of translating a statutory power given to a statutory body into the common law 'ought' [40] . The duty is not absolute; it is a duty to take reasonable care. It is not a duty incapable of performance. It is a duty the performance of which is supported by the provision of statutory power to prevent entry to premises and to remove persons from the premises, if needs be by using reasonable force."

(d) operation of the Civil Liability Act

1. On the basis that the claimants were relying upon a statutory power arising under the Child Welfare Act, the State pleaded that it was a "special statutory power" within the meaning of s 43A of the Civil Liability Act 2002 (NSW) and that it was therefore necessary for them to establish that the act or omission relied upon was "in the circumstances so unreasonable that no authority having the special statutory power in question could properly consider the act or omission to be a reasonable exercise of, or failure to exercise, its power." [62]
2. The failure or omission relied upon as a breach of duty was the failure to report the conduct of LX to the police. Accepting that the statutory power in s 148B(5) had been available, the trial judge held that it was a "special statutory power" and that the claims were to be addressed by reference to the high standard imposed by s 43A. Neither party suggested that that approach was erroneous. However, the section did not preclude the existence of a duty, nor affect its scope, but should be understood as identifying the standard of care. It will therefore operate in considering whether, assuming that a relevant obligation is established, the conduct of the officers of the State failed to reach the requisite standard of care, thereby breaching the duty.

(a) Did the duty encompass an obligation to report to police?

1. In considering the formulation of a common law duty, it is necessary to go beyond the proposition that demands for justice strongly favoured the prosecution of LX. No doubt a system for notification of cases of child abuse could increase the likelihood of such prosecutions. However, it is clear that that was not the primary function of s 148B; its purpose was child protection. That follows from its location in the Child Welfare Act, and the identification of the Director of YACS as the recipient of notifications. Even if it be assumed that the powers were also conferred on other officers in YACS, the primary statutory purpose remained.
2. As senior counsel for the State explained in the course of her submissions on the appeal: [63] "It becomes the question then… let's assume for the purpose of the argument that the decision maker is obliged to at least consider, whether [he] or she will involve the police. At the time, in this case, one has two vulnerable complainants, an utterly unsupportive family environment, at least one of the complainants is extremely psychologically precarious, wrist slashing and the like. The question becomes then, if it is assumed that the police, upon notification would then automatically step in and charge and require witness statements and require those complainants to go into a criminal procedure. If the decision maker said, well I'm not going to do that, because I'm exposing those plaintiffs at this time to that procedure and we are already in the Cobham Children's Court and have got orders in place that the Court believes [will] protect them at the time that we're talking about. His Honour's finding, of course, is that that decision to engage the police had to be taken by 28 April very early in the scheme of things. … It may well be to look from the other side of things, that the very last thing in the world one would do in protecting these two complainants would be to notify the police at the time, as at 28 April."
3. The scope of any duty of care, viewed in the statutory context, was to take reasonable steps in exercising statutory powers to protect victims of child abuse. Abuse may come in many different forms. In the present case, it is proper to identify the scope of the duty by reference to the risk of continued sexual abuse (and occasional physical violence) from the stepfather, directed at the claimants.

(b) what triggered the duty?

1. But even if it did exist, was the duty generic in the sense that it applied to all reports of child abuse? Or was it some specific aspects of the present cases which engaged the duty? If the latter, these circumstances were not identified, except by reference to the Guidelines, and then in a different context. Or was the duty limited to cases where other (appropriate) action had failed? If the last, the duty could only arise where the failure was known (or should have been known) to officers in YACS. That raised a factual question which will be addressed below in considering breach.

(c) error in judgment at trial

1. The trial judge undertook a careful analysis of the authorities and identified, correctly, the principles to be applied in determining whether a duty of care with the scope asserted by the claimants was established. In my view, the exercise of applying the principles miscarried in two respects, each of which is readily identifiable by reference to the comprehensive reasons given by the trial judge.
2. The first error arose in the following passage, at [25]. Having dismissed the possibility that a duty would not arise because of the indeterminacy of the class who might benefit, the trial judge continued: "Nor is there any problem with the need to preserve the coherence of other legal principles or of the scheme of [the Child Welfare Act] which governs the Department's relationship with the plaintiffs. On the contrary, the whole purpose of the Act is to protect children at risk, taking action to that end does not conflict with the Department's statutory responsibilities; it gives effect to them. To the extent to which the exercise of the Department's statutory powers may extend to reporting apparently criminal conduct to police, the suggested common law duty operates entirely consistently with the criminal law which under the common law in force at the time made it a felony to fail to report serious crime: Sykes v Director of Public Prosecutions [1962] AC 528. In general terms, the law of torts and the criminal law have common origins. There is no incoherence or inconsistency in them working together."
3. The need for coherence was properly identified, consistently with authorities such as Sullivan v Moody, to which the trial judge had given careful consideration. However, the principle was applied at too high a level of generality. As was sought to be explained above, in a particular case the public interest in protecting a victim of child abuse from further harm and the public interest in prosecuting her abuser may indeed conflict. The potential conflict would arise starkly in a case where it was believed that the child's mental health would be at risk if she were required to be a witness against her abuser (especially if another family member) in criminal proceedings. In that case the imposition of a common law duty to report the investigation to the police for the purpose of protecting the victim, would lead to actual conflict and thus incoherence. That is a powerful (if not conclusive) reason why the duty should not extend so far.

(6) Scope of duty - conclusions

1. In its scope, the duty of care owed to the appellants by the State through its officers in YACS did not extend to the statutory power to report to police the allegations of criminality by LX. In reaching that conclusion it is necessary to put aside, because not relied on by the State, the arguable case that s 148B(5) of the Child Welfare Act was not engaged because (a) this case was not concerned with a "notification" of child abuse and (b) there was no evidence as to the state of satisfaction of the Director. It remains relevant that the power to report to a constable of police was for the purpose of child protection, not prosecution. The scope of the duty was limited because the common law will not impose a duty of care in circumstances where it would create obligations to consider interests (in this case, the public interest in the prosecution of offenders) potentially inconsistent with the proper exercise of the statutory function (of child protection).
2. It was clearly arguable that officers in YACS owed a duty of care to the claimants in exercising their powers to protect the children. Had nothing been done following the complaints, that duty might well have been breached. But things were done. It may have been arguable that there was a duty to consider the available options, but that too was done. No doubt for these reasons, the claimants formulated the proposed duty as one requiring that a step be taken which was not taken. To accept that proposition would be to convert a statutory discretionary power, involving a balancing of countervailing considerations, into a common law obligation imposed by the court. That step is not warranted and should be rejected.
3. Any liability of the State was vicarious so that, in the absence of a finding as to a relevant duty breached by its officers, no liability arose.

(1) Finding of breach by State

1. Once the judge had accepted that the circumstances of the case imposed a duty to report the complaints to police, only two questions remained. The first, a factual question, was whether the complaints were reported to police. The judge was satisfied that they were not, a finding challenged by the State. The challenge to that carefully reasoned finding should be rejected for the reasons given by Ward JA.
2. The second question, a mixed question of fact and law, was whether that breach involved a failure to comply with the standard fixed by s 43A of the Civil Liability Act. The judge made a finding in those terms: [72] "I have already recorded findings that the risk of TB and DC each suffering further or continuing physical and sexual abuse was both foreseeable in the sense of being not fanciful or far-fetched, and not insignificant. … Looking at that matter wholly prospectively as though further and continuing abuse alleged by each plaintiff had not occurred, and looking at the question from the standpoint of a responsible public authority, having the particular expertise and functions of the Department, I have concluded that no authority acting reasonably could properly consider the failure to report the abuse of TB and DC to the police to be a reasonable exercise of the powers conferred upon it by s 148B(5)(b) [of the Child Welfare Act]."
3. The trial judge identified the temporal element, as refined by the claimants in oral argument, as requiring that a report be made to the Child Mistreatment Unit "no later than 28th April 1983 or as soon as practicable thereafter." [73] That was based on the proposition that by 22 April 1983 Ms Quinn had knowledge of the allegations by TB and had the stepfather's criminal record for sexual offences. On 28 April, she and a senior colleague, Mr Frost, interviewed the mother, who confirmed details of the abuse disclosed by TB and DC. In short, the finding was based on the history of pre-complaint abuse, not on anything that happened after the abuse was reported to YACS.
4. Somewhat curiously, having reached a conclusion as to the question of breach, applying the standard in s 43A of the Civil Liability Act, the judge then addressed the issues raised in determining questions of breach in s 5B of the Civil Liability Act. He stated at [105]: "To the extent to which it may be necessary to give separate consideration to the s 5B(1)(c) condition, in my judgment, in the circumstances, and having regard to the s 5B(2) considerations, a reasonable public authority in the Department's position would have taken the precaution of reporting the matter to the police. There can be no question from what the Department knew from as early as 22nd April 1983, of the stepfather's serious criminal record for sexual offences and of the information it received from TB and DC and their mother by 6 May 1983, that there was a high degree of probability that the abuse would continue if care was not taken. Given the nature of the past abuse, if the harm did occur, it was likely to be very serious. The burden of reporting the matter was slight. No more was required than the Department act in accordance with the guidelines for inter-departmental co-operation it had agreed with the police and the Department of Health. It needed only to observe what Mr Maguire, Mr Frost, the District Officer, and Ms Whale regarded as the Department's own invariable practice in any event. That involved no more than the District Officer, after she had notified Montrose, reporting the matter to Mr Frost and him telephoning the New South Wales Police Child Mistreatment Unit. No issue of any difficulty, inconvenience or expense arises capable of displacing these other considerations. Nor does any question of social utility arise in accordance with s 5B(2)(d)."

(2) Finding of no negligence by Ms Quinn

1. Although concluding that "the Department" was negligent, [74] he concluded that, if Ms Quinn owed an independent duty of care, she was not negligent. [75] In particular, the judge explained: [76] "The plaintiffs do not say that any of the other steps taken by the District Officer for their protection were inappropriate. A careful consideration of the extant contemporary records… demonstrates that the District Officer was careful, conscientious and diligent in the exercise of her functions for the protection of TB and DC. Leaving aside for the moment the contentious question of whether complaints of further abuse were made to her by TB and DC, the steps actually undertaken by the District Officer were appropriate action for the purpose of s 148B(5)(b) [of the Child Welfare Act]."
2. There was no challenge on the appeal to this finding and Ms Quinn was not a party to the appeal. However, some further explanation is required with respect to the differential treatment of "the Department" and its district officer, Ms Quinn.
3. First, it is necessary to identify the steps in fact taken by the district officer, about which no complaint was accepted. On 22 April 1983 a "place of safety" order was obtained from the Children's Court under s 136 of the Child Welfare Act, in respect of DC. The report prepared by the officer for a hearing in the Children's Court on 20 June 1983 stated: "Following [DC's] placement, [LX] voluntarily decided to leave the home and for a few weeks he stayed … at Guildford. (He has since returned home.) At this time [TB] became increasingly distressed. She felt her mother, brother and other extended family members blamed her for 'breaking up the family'. She felt ambivalent towards her mother, saying she loved her but resented her for loving her father and wanting to maintain a relationship with him. She felt her mother was siding with her father and that they were acting as if nothing had happened. During this time [TB] cut her wrists on two occasions. The Montrose After House Service became involved and reported on the incident. It seems that [TB] was falling into the 'victim role' feeling responsible for the family's problems and asked the Montrose worker to charge her as uncontrollable and lock her up in 'a home'."
4. The report continued with a careful and detailed history of the various members of the family, their relationships and noted that a child protection worker, a psychologist and another district officer had become involved with members of the family as part of the "case management". After dealing in detail with the different factors, and without ignoring "[LX's] long standing history of inappropriate sexual behaviour" the report concluded: "As this is an extremely complicated family it is felt there is a need for a period of thorough assessment and evaluation to be conducted by the professionals already involved with the family before a firm recommendation can be made. To ensure the safety and emotional well-being of [TB] and [DC] during this period, it is considered necessary that [LX] reside away from the home."

(3) Negligence of other officers

1. If Ms Quinn were not negligent in preparing this report for the court, it is difficult to understand on what basis any other officer attending the court conference was negligent. In fact, there was no finding that any officer in the department was negligent in presenting this report to the Court. The Children's Court conducted a hearing, the detail of which need not be recounted because it could not form the basis of any finding of negligence on the part of the State. However, two circumstances should be noted. First, the mother gave evidence in relation to the incidents recounted by the children. The transcript is partly illegible, but one answer was in the following terms: "I cannot give exact dates with [TB] it was I think she was 7 [TB] came and told me on the Saturday and I made arrangements on the Monday with my brother as to where to go. I had phoned the police and told them of incident and they declined to take my name they said that if they took my name they would have to follow through and could be devastating for the family and child."
2. In the record of the submissions made to the Court, YACS and LX being represented, the following statements are found in the exchanges with the magistrate, who said: "I intend to take every possible step to ensure the protection of those children. Mrs [X] I am somewhat amazed at your comments about they are as bad as one another. You accept the word of a person with criminal convictions over your own daughters. … [TB] is suffering emotionally. I cannot be overlooking and sympathise that he has made threats to her. He has raped he[r] … and lived in the house she has emotional fear …. She does not want to see him. I can only go along with the view that [DC] is going to appreciate … what that man has done to her and she will become the same as [TB]. You say that you reported it to the police. MRS [X]: I only said interfered with. BENCH: I can only say if you had used intercourse. I get the impression that you are playing it down and I do not want that. … … I intend to call for psychiatric assessments. I have spoken to [TB] and she has no objection to home. Sexual offences alleged are in relation to girlfriend and involves association. [He] is innocent until proven guilty. I would like [to know] more about that strength of the prosecution case because [of] the nature of the matter. I should have report of psychologist of effect on the children and psychiatric examination. I will allow the children home on basis that he does not attend the home at all."

(4) Did the abuse continue after complaint to YACS?

(a) whether complaints of on-going abuse

1. If the evidence failed to demonstrate that responsible officers in YACS had actual knowledge that the steps they had taken to seek to protect the children, had, at some point, failed, the duty to report would not have been breached. That is because the sole relevant purpose of reporting to police was to protect the children.
2. This question was not addressed in this context in the trial judgment. However, after the judge had made a finding of negligence on the part of "the Department", he turned to the question of harm. As the judge correctly noted, "[n]o action for negligence lies unless the plaintiff proves on the balance of probabilities that the negligence I have found caused further and ongoing physical and sexual abuse resulting in consequential mental harm". [88] The position taken by the State at the trial was that the judge could not be satisfied that abuse probably continued after complaints were made by the claimants, but it also asserted, positively, that "no complaints of any continuing abuse were made by either TB or DC, in particular, to the District Officer." [89] The judge said: [90] "[t]he question of whether complaints were made is relevant in two ways. First, it may be probative of whether abuse was actually occurring; and secondly, the complaints may constitute notification for the purpose of s 148B(2) … enlivening a power, perhaps obligation, to further investigate".
3. There was no doubt that the questions were inter-related: that is, absence of abuse would explain absence of complaint, and absence of complaint might imply absence of abuse. The trial judge gave careful consideration to the evidence as to whether further complaints were made. He heard evidence from DC and TB and from the district officer. The judge considered both issues and made complementary findings. With respect to TB, he concluded: [91] "It almost inevitably follows from this, that I am not satisfied that there was any complaint of ongoing abuse to the District Officer. However, I prefer to record my finding that in the absence of any contemporaneous record of complaint in the extant material, I accept the evidence of the District Officer … that she has no recollection of any complaint. Again this is hardly surprising after the effluxion of time. However, from what I regard as the care she took in compiling her reports to the Court, I am of the view, that had such complaints been made, they would have been recorded in those reports and reported to the Children's Court. I am not satisfied on the balance of probabilities that TB complained of ongoing abuse to the District Officer."

(b) continuing abuse of TB

1. The finding that TB had not satisfied the onus of establishing any complaint of on-going abuse turned squarely on the credibility of TB and Ms Quinn. In a statement dated 17 March 2014, TB had referred to meetings with Ms Quinn during a six month period from May 1983 to October/November 1983. She said she may have seen Ms Quinn "on 20 or 30 occasions during that time." [93] She said that she told Ms Quinn that "Len was continuing to come round and that nothing had changed". She said Ms Quinn "never specifically asked me if Len was continuing to sexually abuse me. Neither did I explicitly volunteer that fact to her." [94] However, she also said that LX "would take any opportunity to sexually assault me" and that "[t]he sexual assaults from April 1983 to March 1984 were many." [95] The conduct described included putting his fingers in her vagina, fellatio and feeling her breasts. [96] TB also said: [97] "Len's sexual assault on me continued through until the end of 1983. Even though I had entered into employment he would still use every opportunity available to him to put his fingers in my vagina and to put his penis in my mouth."
2. The trial judge had careful regard to the various reports prepared over the year, noting that there was "a lack of any explicit record of any abuse after April 1983." [98] The judge referred to instructions given to Dr Michael Diamond, psychiatrist, by TB's solicitor in December 2007 advising him that the abuse had "occurred 'between 1975 … and early 1983'." [99] Dr Diamond took a detailed history from TB in February 2008, including sexual abuse up until 1983, but recorded no history of abuse after April 1983. [100]
3. The judge had regard to matters which supported a finding that the abuse continued: [101] "Matters which do favour a finding that the abuse continued after the report include the stepfather's abhorrent behaviour; that he committed a sexual assault in January 1983 for which he was later convicted; further allegations of sexual assault in early 1984, which were dropped; the mother's dependency upon the stepfather and her unwillingness to let go of him, despite her knowledge that he had previously abused her daughters; the mother's tendency not to comply with the conditions of orders made by the Children's Court in the interim period between April 1983 and October 1983, in particular, allowing visits from the stepfather to the family home; the stepfather's bad criminal record for sexual offences; and the District Officer's legitimate concern that TB (and DC) continued to be at risk from him."

(c) continuing abuse of DC

1. The critical evidence in relation to DC appeared in her statement of 22 April 2014. [103] "51 Before Len moved from Lalor Park to Blacktown and after I had been returned home from the foster homes, Len resumed sexually assaulting me. 52 From the time Carolyn Quinn interviewed me in mid-April 1983, Len did not attempt to rape me by putting his penis in my vagina. However, from April 1983, his sexual assaults involved putting his hand into my underclothes and pushing his fingers into my vagina and putting his penis in my mouth and holding my head with both hands and pushing my head back and forth on his penis."
2. The trial judge referred to this evidence, [104] acceptance of which was central to her claim. As with the evidence of TB, the judge undertook a careful and thorough examination of the documentary record, which he said "does not support DC's evidence about this abuse." [105] With respect to DC's behaviour at the time, the judge said: [106] "It is possible that some of DC's reported behaviour could be explained by ongoing abuse, but it may [be] explained by past abuse. In the absence of any contemporary evidence of abuse, or complaint of abuse, past abuse is the more probable explanation because of the undisputed evidence that it occurred."
3. The judge then noted a number of statements made by TB between 2001 and 2008, including a letter from her solicitor to Dr Diamond, referring to abuse occurring "on an almost daily basis until about April 1983". The judge also said in respect of Dr Diamond's report, following a consultation with DC on 1 February 2008, that it included "no history recorded at all of any further sexual abuse by her stepfather after the Department was notified." [107]
4. However, Dr Diamond did refer to a history noted in a report prepared by a treating psychologist, Dr Janina Szyndler, who first saw DC in 2005. In taking a history in 2006 (more than 20 years after the events), Dr Szyndler noted that "[t]he abuse ended before [DC] turned 13", which would have been before October 1983. However, Dr Szyndler also recounted: [108] "The abuse came to the attention of authorities when [DC's] older sister disclosed to the school counsellor. [DC] was 11 at the time. DoCS removed [DC] and her sister and told their mother that [LX] had to leave the family home. He did very briefly and the girls returned home. However, [LX] then returned. [DC] told me that her mother then chose [LX] over the children. [DC] described her mother taking them to visit [LX] and insisting that they should sit on his lap and kiss him goodnight. She recalled that he would then grope her."

(d) no basis for interference

1. The trial judge having (a) heard oral testimony, over some days, from each of the claimants and from Ms Quinn, and (b) chronicled over many pages the lack of evidence of any complaint until long after the criminal proceedings had been taken against LX, concluded that there had been no continuing abuse after the initial action taken by YACS. It may be accepted that there was a real risk that LX would continue his predatory conduct; but that was the very risk against which Ms Quinn had sought to guard and was expressly considered in assessing the claimants' credibility. It could not be assumed that abuse continued; it was a critical element that had to be proved. The belated evidence of the claimants that it did (without which their claims had to fail) required sceptical evaluation. The analysis of the trial judge was thorough and, with only one possible and immaterial error, impeccable.
2. The credibility findings with respect to TB and DC cannot be rejected on any of the bases identified in Fox v Percy. [112] They were not "glaringly improbable", but rather the contrary, given the absence of documentary records of complaint. In relation to TB, the trial judge was entitled, indeed obliged, to assess her claims of post-complaint abuse against the absence of any supporting evidence until her evidentiary statement made for the purposes of the civil claim, in 2014. In relation to DC, there was the somewhat equivocal reference in the history recorded by the psychologist in 2005-2006, which referred only to being "groped". Otherwise she too made no complaint of such conduct until 2014.
3. The refusal to be satisfied as to the truth of the claimant's evidence was not to make a ruling inconsistent with any incontrovertible fact. There was nothing like the skid mark on the road leading to the rear tyres of the defendant's vehicle, indicating that it was in fact on the correct side of the road, as in Fox v Percy. There is no doubt that, given the long standing predatory behaviour of LX, which formed the basis of the complaints to YACS, each was at risk of continuing abuse. That was, as the trial judge expressly accepted, a factor which placed them at risk of continuing abuse, absent effective intervention. However, there was no incontrovertible evidence that they were in fact abused after YACS' intervention. That the trial judge rested his conclusion on his failure to accept the credibility of the claimants is undeniable, as is the fact that he gave careful consideration to the evidence which might support or not support their claims. There is nothing to demonstrate that the credibility findings were erroneous. It would be inconsistent with the appellate restraint mandated by Fox v Percy, recently affirmed in Robinson Helicopter Company Inc v McDermott, [113] and a long line of authorities to the same effect, for this Court to set aside those findings and conclude that the claimants were telling the truth. It is not open to this court to intervene.

D DAMAGES

1. In circumstances where the claimants must fail, if not at the point of establishing a duty of care owed by relevant officers in YACS, at least having regard to the elements relied upon as demonstrating breach of duty, it is preferable not to deal with the questions relating to the assessment of damages. That assessment was replete with difficulties.
2. First, it assumed that abuse had occurred when the judge concluded it had not. How serious was the abuse assumed to be in this counter-factual? There is no doubt that the claimants have suffered serious psychiatric injury as a result of years of sexual abuse inflicted by LX. To the extent that aspects of the symptomology only surfaced at or following the criminal trial in 2005 is beside the point. All the psychiatric harm was consequential upon his conduct over several years.
3. If the claimants had sued LX, no issue would have arisen as to the stages at which the harm arose. However, in bringing a claim in negligence against the State, the claimants had to establish that, at least in part, psychiatric injury resulted from LX's conduct after the complaints to YACS' officers in April 1983, or at some point thereafter when it should have been apparent to the officers that the steps taken to protect the claimants were inadequate and that further steps were required. That could not have been sensibly assessed (by the psychiatrists) or proved before the court without knowing what was found to have occurred and when.
4. Secondly, although the temporal element was significant, it was not adequately addressed. For example, it was necessary to determine, on the assumption that knowledge of the failure of the process was relevant, whether and when those matters became known, or should have become known to officers in YACS. It was also necessary to determine when, if the matter had been reported to police, LX would have been arrested.
5. It would then have been necessary to identify the periods during which each of the claimants was at home and vulnerable. For example, from about 20 April 1983 until about 20 June 1983 DC appears to have been in a foster home. She then returned to the family home for a short period before being sent to Dalmar. She may have been in the family home for one or two weeks, in July 1984, at which point she left. Assessment of what harm occurred after the critical date required identification of the periods during which the harm occurred.

E CONCLUSIONS

1. These reasons lead to the following conclusions: 1. the State's contention that the duty of care owed to the appellants did not extend to an obligation to report the conduct of LX to the police should be upheld; 2. the challenge by the State to the finding that the complaints of child abuse against LX were not reported to the police should be rejected; 3. the appellants' challenge to the finding that no further abuse was shown to have occurred after the complaints to YACS should be rejected; 4. in the absence of any finding of ongoing abuse after the complaints were made, the State's challenge to the finding that officers in YACS were in breach of their duty of care to the appellants should be upheld; 5. in the absence of any finding of negligence on the part of its officers in the department of YACS, the State is not vicariously liable to the appellants; 6. the ultimate finding that the State was not liable in damages to the appellants should be upheld.
2. I would propose the following orders: 1. Dismiss the appeals brought by the first and second appellants from the judgment in the Common Law Division given on 22 May 2015. 2. Order that the appellants pay the costs of the State of the proceedings in this Court.
3. WARD JA: The appellants, DC and TB, are sisters. They were the victims of ongoing sexual and physical abuse by their step-father over a number of years from the time when they were around five and seven years of age, respectively. The abuse was first the subject of complaint by TB to the then Department of Youth and Community Services (the Department) in April 1983, when TB was 15 years old, although complaints had been made by both the appellants to their mother at a much earlier time (sadly, to no effect).
4. Following the making of the complaint by TB to the Department, both sisters were interviewed by a case officer from the Department (Ms Quinn) - TB on 20 April 1983 and DC on 22 April 1983. The mother was interviewed by Ms Quinn on 28 April 1983. In that interview, the mother admitted awareness of the sexual abuse and acknowledged that her daughters had complained of it to her.
5. Each of TB and DC was then charged, at the instigation of Ms Quinn, under the provisions of the Child Welfare Act 1939 (NSW) with being a neglected child. Those charges were dealt with by a special magistrate in the Children's Court in proceedings culminating in a hearing on 19 September 1983. On 15 September 1983, thus shortly prior to the 19 September hearing, Ms Quinn had interviewed the step-father in the presence of a child protection officer from the Department, Ms Whale. In that interview, the step-father admitted the sexual abuse and appeared to the case officers to be unrepentant. Final orders were made on 7 November 1983 releasing the children into the care of the mother on conditions that were clearly intended to restrict the step-father's access to the appellants.

Appeal

1. By their amended notice of appeal filed on 12 October 2015 the appellants raise 17 grounds of appeal from the primary judge's decision. The appellants argue that the primary judge erred in: (1) Failing to find, on the balance of probabilities, that physical and sexual abuse of the Appellants continued after the report to the Department on 22 April 1983. (2) Finding that the accuracy of the detail was crucial in respect of the question of whether the Appellants were abused by their stepfather after the report to the Department on 22 April 1983. (3) Placing excessive weight on the contemporaneous materials in circumstances where he accepted that very few existed, and where there was no evidence that any of the authors asked the critical question, namely whether the abuse was continuing. (4) Failing to find that, where no report had been made to the Police, the stepfather was continuing to abuse the Appellants. (5) Placing excessive weight on the lack of written record of sexual abuse after the report to the Department on 22 April 1983. (6) Failing to give any or any sufficient weight to factors suggestive of ongoing sexual abuse of the Appellants after the report to the Department on 22 April 1983. (7) Failing to make adequate findings of: (i) primary facts; and (ii) reliability and/or credibility of witnesses. (8) Failing to place sufficient weight on the District Officer's belief that, having spoken to the stepfather in September 1983, the stepfather was "unlikely to change". (9) Placing excessive weight on the absence of reference to complaint of abuse of the Appellants after 22 April 1983 in documents which came into existence after that time. (10) Making findings in terms of "significant" abuse and abuse of a particular type or types, as opposed to directing himself to the question of whether any abuse occurred after the report to the Department of 22 April 1983. (11) Failing to give any or any sufficient weight to the changed behaviour of each Appellant subsequent to the report to the Department on 22 April 1983. (12) Finding that any complaint of ongoing abuse after 22 April 1983 would have been recorded in reports by the District Officer to the Children's Court had they been made. (13) Placing excessive weight on the absence of record of complaint in reports to the Children's Court made by the District Officer in circumstances where: (i) the District Officer had from the outset 'great concern for the physical and emotional safety of the children' because of the stepfather's record and 'longstanding history of inappropriate sexual behaviour' and knew he had returned to the family home; (ii) the District Officer did not recall asking either Appellant if the abuse was continuing; (iii) the District Officer was aware of altered behaviour on the part of the Appellants, including TB becoming 'increasingly distressed', significant distress on the part of DC, wrist slashing on the part of TB and a desire to be removed from the family home; and; (iv) the District Officer knew the stepfather was having inappropriate access to the Appellants and was of the opinion that the stepfather's access and his nature posed a significant risk to the Appellants; and (v) after interviewing the stepfather in September 1983, the District Officer recorded the belief that the stepfather was "unlikely to change". (14) Finding that the matters favouring a finding that the abuse continued after the report to the Department of 22 April 1983 merely went to a continuing or increased risk, rather than a probability of actual abuse continuing. (15) Failing, having found breach of duty on the part of the Department, and having found that reporting to the Police by the Department would have avoided further inappropriate contact between the stepfather and the Appellants, to find that consequences of contact between the stepfather and the Appellants which post-dated the report of the Department on 22 April 1983, including wrist slashing on the part of the Appellant TB, constituted damage. (16) In relation to the contingent assessment of damages, his Honour erred in treating the harm over the whole period pre- and post-April 1983 as "indivisible" but then proceeded to apportion damages. (17) His Honour erred in apportioning damages when the Respondent had not discharged the evidentiary onus on it, pursuant to Purkess v Crittenden, to adduce evidence of the extent to which damage to the Appellants was caused otherwise than as a result of the Respondent's breach of duty.

Additional background

1. It is convenient at this stage to set out the following further matters by way of background.
2. As noted in the introduction to these reasons, each of the sisters was interviewed by Ms Quinn following the initial complaint made by TB by telephone to the Department about sexual and physical abuse. In those interviews, which took place on 20 and 22 April 1983, disclosures were made by each of TB and DC of their step-father having had penile/vaginal intercourse with them and taking photographs of their genitals. TB also disclosed physical abuse and "fiddling"; her step-father touching her "down below"; and that her step-father had made her hold his penis. TB said that she had reported this to her mother.
3. Steps were taken by the Department almost immediately to place both children away from the family home. A volunteer care arrangement was made for TB to stay with the family of a friend. She then subsequently moved into her grandmother's home. A "Child at Risk Notification" was completed by Ms Quinn in relation to DC, who was then aged 12, and she was moved to a place of safety on the night of 21 April 1983. The Child at Risk Notification form noted that the step-father had spent 8 years in gaol for sexual offences and was currently on a rape charge (from which it is apparent that at an early stage of the Department's involvement there was an awareness that the step-father had a history of sexual offending). A "place of safety" order under s 136 of the Child Welfare Act was obtained from the Children's Court in relation to DC, on Ms Quinn's application, on 22 April 1983 to enable DC to be placed in care for 14 days.
4. On 28 April 1983, the mother was interviewed by Ms Quinn in the presence of another Sydney district officer. The mother admitted that the appellants had told her about the sexual abuse by their step-father and said she had told both the girls "if their father tries to do terrible things to them they should scream and kick and bite and anything they can do" (an extraordinary and inappropriate response to disclosure of such serious offending to say the least, even if explicable to some extent by the mother's own experience of childhood sexual abuse).
5. On 2 May 1983, orders were sought by Ms Quinn from the Children's Court in relation to each of TB and DC, both by then having been charged as a neglected child by reference to the definition in s 72(j) of the Child Welfare Act, namely a child or young person "who in the opinion of the court is under incompetent or improper guardianship". It appears from the respective court charge sheets that the orders made on that occasion were that the children be allowed home.

Proceedings

1. As pleaded (DC's second further amended statement of claim filed 21 March 2013 and TB's second further amended statement of claim filed the same date), what was alleged by each of the appellants was that in the "Pre-YACS Period" both she and her sister were frequently subjected to and apprehended physical assault and sexual assault by the step-father (see [9] and [10] of the respective pleadings).
2. The Pre-YACS Period was defined in both pleadings as being between about late 1974/early 1975 and 20 April 1983 ([7]). Particulars were provided (at [9] of the respective pleadings) of the alleged physical and sexual assaults and those were there defined as the "Pre-YACS Physical Assaults" and the "Pre-YACS Sexual Assaults". Although the physical assaults were not particularised in identical terms (DC's including the step-father holding her head and moving it forward and backward during forced fellatio; TB's including on one occasion holding his hand over her mouth until she could not breathe and actual physical violence during the so-called Tennis Court Incident), the sexual assaults were particularised in substantially identical terms as follows: (a) Inappropriate touching of the Plaintiff's genitals by [the step-father]. (b) Oral and vaginal, digital and penile penetration by [the step-father]. (c) Forcing the Plaintiff to perform fellatio upon [the step-father]. (d) Forcing the Plaintiff to pose [in the case of DC] with her vagina held open so that [the step-father] could take photos showing the Plaintiff's genitals [and in the case of TB] naked with her legs spread so that [the step-father] could take photos showing the Plaintiff's genitals and [his] penis.
3. The respective pleadings allege (at [40]) that during the "Post-YACS Access" (defined as the period from 20 April 1983, when it is alleged each appellant was required by her mother to allow the step-father to visit the family home and to visit the step-father where he was otherwise residing), the step-father: continued sexually to assault both the particular appellant (defined as "the Post-YACS Abuse") and that appellant's sister (defined as "the Post-YACS Abuse on the Plaintiff's Sister") (these forms of abuse being jointly defined as "the Post-YACS Abuse on the 2 Sisters"). No particularisation of the continued sexual assaults was there provided. The appellants' case as explained on the appeal, as I understand it, is not that any further penile/vaginal penetration occurred after April 1983, nor that any further indecent or pornographic photographs were taken; but rather, that abuse at least in the form of "groping" continued to occur in the Post-YACS Period. (Both TB and DC in their evidentiary statements in the Common Law Division proceedings stated that the on-going sexual abuse included digital penetration of the vagina, forced fellatio and inappropriate touching and kissing.)

Grounds 1-15 of the grounds of appeal - finding that sexual abuse did not continue after notification to Department of abuse in April 1983

1. I propose to deal first with the principal complaint by the appellants, namely the finding by the primary judge as to whether the sexual abuse continued after the April 1983 notification of abuse to the Department, before turning to the issues raised by the respondent's notice of contention.

Relevant findings

1. The primary judge addressed this question from [121]-[167] of his reasons. His Honour had earlier noted (at [117]) that in the circumstances of the case, for ethical reasons senior counsel for the respondent did not put to either appellant as a positive proposition that the abuse did not recur after April 1983. Nor did the respondent submit that to the primary judge. Rather, the respondent argued that the court could not be satisfied on the balance of probabilities that such abuse had continued. The respondent did, however, submit that the primary judge should take into account that no complaints of any continuing abuse had been made by either TB or DC to Ms Quinn.
2. As to TB, his Honour noted (at [121]) the content of her evidentiary statement as to the continuing sexual assaults during the period in question (April 1983 to March 1984) and that in that statement TB said she had informed Ms Quinn at various meetings that the step-father "was continuing to come around and that nothing had changed" and that Ms Quinn had not specifically asked her if the step-father was continuing sexually to abuse her and that "[n]either did I explicitly volunteer that fact to her". His Honour accepted that in both her evidentiary statement and in examination in chief TB had said that she had told Ms Quinn on more than one occasion that "nothing's changed, he's still doing it" and that he was coming to the house ([122]).
3. His Honour accepted that the lack of significant detail in this account might be understandable given the lapse of time and the fact that some victims may cope by suppressing memories ([123]). In that context, his Honour reiterated what he had earlier (at [11]) said, namely that this was a case where the accuracy of the details was crucial (there referring to what had been said by McHugh J in M v The Queen [1994] HCA 63; (1994) 181 CLR 487 at 534, namely that in a case where accuracy of recollection was vital, discrepancies and inconsistencies in a witness' account might make it impossible to accept that evidence no matter how honest the witness appeared to be).
4. At [125], his Honour observed that there was a lack, in "all the documents compiled over all the years", of any explicit record of any abuse after April 1983, though noting that the records were made by people other than TB and that not all of them were necessarily internally consistent. In particular, his Honour referred to the reports prepared by the Department for the Children's Court, which recorded concern for the safety of the children but did not record any complaint of ongoing physical or sexual abuse ([126]-[127]); to the comments made by the magistrate at the hearing on 19 September 1983 ([128]); to reports made by Mr Skead and by a psychiatrist Dr Blow, in 1983 ([129]-[130]); and to the statements given by TB to the police ([131]-[132]), commenting that the absence of any charge relating to conduct after the report to the Department was "not without significance". The primary judge also referred to various medical reports that were in evidence ([134]-[137]).

Appellants' submissions

1. The appellants place weight on the step-father's extensive history of sexual offences; his apparent lack of inhibition in the commission of sexual offences in the presence of the mother (referring to TB's evidence as to the groping of her breast while the family were on holiday in the car together and her statement to that effect to Ms Quinn); the fact that he committed various sexual offences against them (prior to the report to the Department) while he was on bail in relation to existing criminal charges; and the severity and intimidatory nature of the step-father's violence towards them (referring to the so-called "Tennis Court Incident" in respect of TB); the step-father holding his hand over TB's mouth until she could not breathe; his verbal threats to TB, which were reported to Ms Quinn, and to DC; and a throat slitting gesture made to the appellants at his 2005 criminal trial in open court. (To that must be added the remarkably brazen attitude the step-father was recorded as having adopted when interviewed by Ms Quinn in September 1983 and when he admitted to the mother in October 1983 that he had raped his son's girlfriend.)
2. Emphasis is placed on the level of concern expressed at the time of the Children's Court proceedings as to the step-father's nature and propensities (referring to Ms Quinn's reports of 20 June 1983, 19 September 1983 and 21 October 1983; as well as the comments made by the magistrate in the Children's Court on 19 September 1983) and to the evidence given by Ms Quinn in the Common Law Division proceedings both as to the concern she had at the relevant time about the appellants spending time with the step-father "in any access and opportunity situation at all" and as to the way in which (in hindsight and with the benefit of her additional professional experience) she would now have perceived the risk of ongoing sexual and physical abuse. As to the last, the appellants point to Ms Quinn's evidence that: her concern was that the step-father would in all probability continue to abuse the appellants sexually and physically, and that she perceived him to be a serious risk to safety; she now considered DC sitting on her step-father's lap when he visited (a matter to which she referred in her 19 September 1983 report) to be very concerning (although it is relevant to note her qualification that she could not remember what she thought of that behaviour at the time she became aware of it); the step-father having continued opportunity to access the girls put them at very serious physical and sexual risk; and that, as a professional in 2014, she was very concerned about the safety and well-being, physically and emotionally, from sexual abuse. Ms Quinn, rating the risk as at 2014, accepted that TB (and one would assume also DC) had been at grave risk.

Respondent's submissions

1. The respondent argues that the appellants have not established any material error in the process of fact-finding undertaken by the primary judge. The respondent points to the fact that the primary judge took into account the various factors relied upon by the appellants, such as: the history of sexual offences by the step-father (raised by grounds 1, 6, 7, 14) ([140]); the mother's lack of capacity to protect the appellants from the step-father; the reports of Ms Quinn as to his frequent visits to the home and her belief that the step-father was unlikely to change (grounds 3, 5, 8, 9,12,13); the behavioural changes displayed by the appellants subsequent to the notification to the Department (grounds 11 and 15); and the matters in Dr Diamond's report.
2. The respondent maintains that there was no logical explanation for the failure of the appellants, as adults, to report to the police in 2001/2002 any ongoing sexual abuse that had occurred after notification of the abuse to the Department. The respondent also points to the instructions given by the appellants' solicitors to Dr Diamond when instructing him on 20 December 2007 to prepare reports in relation to TB and DC addressing issues required for the purposes of the application to extend time for the bringing of the proceedings against the State. Those letters include a summary of relevant documentation and instructions from the respective appellants and ask Dr Diamond to assume, among other things, that the abuse continued "until about April 1983".
3. As to whether his Honour erred in making findings in terms of abuse of a particular type or types, rather than directing himself to the question whether abuse of any kind occurred after the Department was first notified in April 1983 (ground 10), the respondent submits that his Honour properly confined his enquiry to the type of abuse pleaded as having given rise to the appellants' recognised psychiatric illness (namely, post-traumatic stress disorder). It submits that the primary judge took into account the relevant reports noting the appellants' behavioural changes and the evidence of Dr Diamond as to those matters. The respondent argues that the complex psychological and other factors affecting both TB and DC over a lengthy period of time were not demonstrated to be the result of any ongoing, post-notification assault on them by the step-father, noting Ms Quinn's evidence that self-harming behaviour could occur long after abuse had stopped.

Determination

1. The question whether the appellants had been abused by the step-father after the notification made to the Department was a question of fact that the appellants were required to establish on the balance of probabilities in order to prove the case that they had pleaded, damage proved on the balance of probabilities being the gist of the cause of action in negligence.
2. As can be seen from the summary of the primary judge's findings on this issue, his Honour's reasons for finding unpersuasive the evidence of TB and DC as to the alleged ongoing sexual abuse were based largely, if not wholly, on the lack of a report of such abuse in the contemporaneous documentation and subsequent medical or other documentation. While the respondent points to the primary judge's statement (at [164]) that he did not find persuasive DC's account of the post-notification abuse or her evidence about complaining about it to Ms Quinn, the only aspect of DC's evidence that the primary judge found to be a reconstruction and not credible was her evidence as to an attendance at Blacktown Police Station (that his Honour addressed at [94]-[101]). This is not a case where the relevant finding (as to whether the abuse had continued post-notification) was based on the credibility of the respective witnesses (whom the primary judge had the obvious advantage of seeing and hearing given their evidence). Hence the limitations on appellate review of the fact-finding process explained in Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 do not preclude an assessment by this Court of the inferences to be drawn from the documentation on which his Honour relied so heavily in concluding that the sexual abuse had not continued post-notification.
3. The matters identified by the primary judge at [140] establish in my opinion a very powerful case for the proposition that, on the balance of probabilities, the appellants continued to be sexually abused after April 1983. The significance of those matters goes far beyond the continuation, or increase, of a "risk" of sexual abuse. They strongly point to the probability that, if given the opportunity - as the step-father clearly was during the post-notification period - to have access to the appellants, the step-father would have continued to abuse the appellants.
4. Those matters were not in dispute. It is not only the contemporaneous documentation that provides a reliable indication as to whether the sexual abuse continued. If the established facts suggest that the abuse continued, then they, too, must be given very considerable weight. One of those established facts is that the complaints made by the appellants in 1983 to the Department were truthful and basically accurate, as reflected in the ultimate plea of guilty in the subsequent criminal proceedings.

Notice of Contention

1. Before addressing the remaining grounds of appeal, which go to the question of damages, it is convenient to consider the challenges made by the respondent to the findings as to the existence, and breach, of a duty of care owed by it.

Relevant findings

1. The primary judge noted (at [14]) that when the matter had earlier been before this Court (DC v New South Wales [2010] NSWCA 15) the Department seemed to accept that it owed to each of the appellants a duty of care but had disputed that it extended to requiring it to report suspected sexual abuse to the police (there referring to the acknowledgment recorded as having been made by counsel for the respondents in Sackville AJA's reasons for judgment at [48]-[49]). The respondent does not demur from this proposition.
2. His Honour found (at [27]) that it was appropriate in the circumstances that there be imputed to the Department a legal duty of reasonable care in the exercise of the statutory power that was conferred on the Director (defined in s 4 of the Child Welfare Act as the permanent head of the Department or a person acting as head of the Department) by s 148B(5)(b) of the Child Welfare Act ([15]; [19]; [31]).
3. In reaching that conclusion, his Honour noted that it was reasonably foreseeable, at the time of the initial notification of the abuse, that further harm would ensue if the Department did not take action to protect TB's welfare ([19]), so as to engage s 148B of the Act; as was similarly the case in relation to DC ([21]). His Honour considered that the powers engaged on the facts of the case were, first, the power promptly to cause an investigation to be made into the matters notified and, secondly, if satisfied as to the assault/neglect, to take such action as the Department believed appropriate, which might include reporting the matter to the police ([20]). There is no dispute as to those findings.
4. The primary judge considered that the terms of the statutory powers and the purpose for which they were conferred created a special relationship between the Department and children who the Director was satisfied, after investigation, had been assaulted, neglected or ill-treated ([24]). At [26], his Honour listed those matters that he considered favoured the imputation of a common law duty of care. Those included the foreseeability of harm; the nature of harm (the personal safety of a child); and that any failure to exercise the Department's powers was likely to expose the appellants to a high degree of risk of ongoing harm at the hands of the step-father.
5. The relevant risk of harm was identified by the primary judge at [35], for the purposes of s 5B of the Civil Liability Act and s 43A of that Act, as being the risk of further injury and mental harm being suffered by each of the appellants by ongoing sexual and physical abuse at the hands of the step-father. His Honour considered that there was a foreseeable risk of ongoing physical and sexual abuse and that the risk was not insignificant ([37]-[38]). His Honour next addressed two matters: whether a reasonable person in the Department's position would have taken the suggested precaution (that being to report the matter to the police as the appellants contended it failed to do) and whether, for the purposes of s 43A, a failure to notify the police was in the circumstances so unreasonable that no government authority having the powers conferred by s 148B(5) could properly consider that omission to be a reasonable exercise of its power. His Honour concluded that both questions should be answered in the appellants' favour.

Ground 1 of the notice of contention - whether duty of care required report to the CMU/police

1. The respondent does not challenge the finding that a common law duty of care was owed to the appellants in the exercise by the Department of the statutory powers conferred on it under the Child Welfare Act, as such. Rather, ground 1 of the notice of contention challenges the content or scope of the identified duty; i.e., that the common law duty of care imposed on the respondent a duty to report a matter of child abuse to the police.
2. The respondent says that the primary judge correctly accepted that s 46 of the Civil Liability Act (which provides in effect that the fact that a public or other authority exercises a particular function does not indicate that it was under a duty to do so or that the function should be exercised in particular circumstances or a particular way) applied in the present case ([30]). However, the respondent contends that the primary judge erred in treating the guidelines as establishing the requisite standard to be met by the respondent in the discharge of the identified common law duty of care. The respondent submits (at [43]) that in so doing, his Honour failed to apply the principle articulated in Roads and Traffic Authority of NSW v Dederer [2007] HCA 42; (2007) 234 CLR 330 requiring "a contextual and balanced assessment of the reasonable response to a foreseeable risk" (referring to what was said in Dederer at [69]).
3. In particular, it is submitted that the primary judge did not consider whether the system that was put in place by the respondent was, in itself, evidence of the taking of reasonable steps to fulfil any duty of care owed to the appellants ([44]) (something that would go to the discharge of the duty of care not the content of the duty of care as such). The respondent contends that his Honour elevated the guidelines to the standard required to be met by the respondent through its officers, such that any failure to comply strictly with those guidelines would be a negligent omission ([44]).
4. The respondent maintains that the guidelines were no more than procedural and did not impose an obligation on any officer of the Department to make a decision to "involve" police in any particular matter. It is submitted that his Honour wrongly treated the guidelines as synonymous with the common law standard required to be observed, and thus misdirected himself as to the required criterion of reasonableness and overlooked other means by which the duty to take reasonable care in the exercise of the available powers under s 148B of the Child Welfare Act could be achieved. The respondent argues that the primary judge erred in translating a common law duty of reasonable care into a duty to ensure a particular result by a particular procedure, namely notification of alleged child abuse to the CMU, and wrongly elevated the scope of the duty to ensure that a report had been received by a particular unit of the NSW police (see [45]-[47]).

Determination

1. I accept that in their terms the guidelines are procedural and that they do not impose on the Department a mandatory obligation to report suspected child abuse to the police or to any particular unit within the police (such as the CMU) in all matters. I do not, however, accept that the primary judge treated the guidelines as synonymous with the common law standard required to be observed in all cases or translated a common law duty of reasonable care into a duty to ensure that the CMU receive a report of child abuse in this particular case.
2. The relevance of the guidelines in my opinion, and the guidance that the primary judge derived from them, was that they indicated what those who had formulated and adopted them considered to be a proper and reasonable response in cases of suspected child abuse. What the guidelines in mandatory terms required was that all notifications of child abuse be reported to Montrose (cl 1.1). However, they also envisaged that consideration be given to "involving" the police (which can only sensibly be read as encompassing notification of the abuse to the police) in child abuse cases and they gave an indication as to when it would be considered appropriate for the police to be involved.
3. Therefore, in giving content to the common law duty to exercise reasonable care in exercising the powers available under s 148B(5), the guidelines give a clear indication that in matters of suspected child abuse one precaution that might reasonably be taken, depending no doubt on the circumstances of any particular case, in order to avoid the foreseeable risk of further harm to the child, would be notification of the abuse to the police. Relevant to be taken into consideration in determining whether such a precaution was reasonably necessary in the present case would surely be that the suspicion of child abuse can only have been heightened by the step-father's known criminal history/sexual proclivities and the mother's admission, at an early stage of the Department's involvement, that the appellants had complained of abuse at an earlier time. Another relevant factor would no doubt be the nature of the abuse of which complaint was made. Here, on any view of things, it was very serious - penile/vaginal intercourse of children (at a time when they were, according to the initial notification, under 10) by someone in a position of trust and responsibility within the family unit.

Grounds 2 and 3 of the notice of contention - breach of duty

1. The respondent contends that the primary judge erred in finding a breach of the common law duty of care and ought to have found that the Department took reasonable steps to report the abuse to the CMU and/or a constable of police or, alternatively, that the evidence did not permit of any inference or finding that the abuse was not so reported.

Relevant findings

1. The primary judge concluded (at [85]) that the appellants had established on the balance of probabilities, that the abuse was not reported to the police in accordance with the well-established procedures to which he had earlier referred (i.e., the inter-departmental guidelines and evidence as to the practice adopted within the Department at the time). The officer in charge at the time, Mr Maguire, gave evidence that there was a formal requirement that police be notified in cases of serious, particularly sexual, abuse and Mr Frost also gave evidence as to the practice of notifying police if there was sexual abuse.
2. At [90], his Honour considered an argument by the respondent that a report to the police might have been made informally and said that this was inconsistent both with the inter-departmental guidelines and with the evidence by Mr Maguire and Mr Frost. The primary judge accepted that Mr Frost attended the interview with the appellants' mother on 28 April 1983 ([110]). Mr Frost's evidence was that his practice on receipt of reports from his subordinates as to allegations of child sexual abuse was: We would ensure the child was safe, we would ensure we'd let the police know if there was sexual abuse and also we would place a child on a complaint before the Children's Court, it would be part of the practice and that his practice in that regard would be to call the CMU.
3. His Honour rejected a suggestion that the CMU might have directed the Department to the local police, observing that the suggestion was premised on an unproven assumption that the cases were in fact reported to the CMU in accordance with the guidelines ([91]). In his Honour's view (at [92]), the respondent was not assisted by the practice of not interviewing parents suspected of offending if there was a chance of a police case being pursued. The step-father had been interviewed on 15 September 1983, but it could not be inferred that the interview took place because the police had been notified of the abuse but had decided not to charge the step-father. His Honour considered that the suggestion that there was a practice not to interview parents suspected of offending if there was a chance of a police case being pursued (something relied on, as I understand it, by the Department to argue that it could be inferred from the fact of the 15 September 1983 interview with the step-father that the matter had already been reported to the police) suffered from the same flawed logic ([92]).

Respondent's submissions

1. The respondent refers (submissions at [49]) to the statement by French CJ in Stuart v Kirkland-Veenstra [2009] HCA 15; (2009) 237 CLR 215 (at [49]), when considering the application of private law notions of duty in the field of the exercise of powers under public statutes, that: A claim for damages for breach of a duty of care may be made against the repository of a statutory power in circumstances in which: (i) a decision has been made not to exercise the power; or (ii) a decision has been made to exercise the power and the claim relates to the manner of its exercise.
2. The respondent argues that the present case was one where a decision had been made to exercise the relevant power (reporting notifications of serious child sexual abuse to police) and therefore the appellants' claim could only concern an alleged failure in the manner of that exercise, which required an enquiry into particular steps taken by relevant officers of the respondent following the notification of the abuse by TB. (As I read that submission, the "decision" to report notifications of serious child sexual abuse to the police is a reference to the protocol established in the inter-departmental guidelines since there was no evidence that in fact a decision was made in this case to refer the matter to the police. If so, such a submission flies in the face of the respondent's earlier submission that the guidelines were procedural only.)
3. The respondent maintains that, in the absence of the relevant records of the respective agencies, the appellants did not establish, by probative evidence, "the links in the chain of events that contextualised and defined the 'manner' of the exercise of the power by the Department" ([51]).
4. Various criticisms are made as to the reasoning adopted by the primary judge. In essence, the respondent argues that the enquiry by his Honour involved a speculative reconstruction of what one agency, the CMU, may have done had it been possessed of the information known to the Department. It argues that it cannot be inferred, from the fact that no charges were laid against the step-father, that no report of the abuse was made to the CMU.
5. The respondent argues that the finding that there was a "general expectation" that serious cases of repeated and severe abuse would not only involve discussions between the Department and the CMU but would also lead to charges being laid, is tendentious and unsupported by the evidence.

Appellants' submissions

1. The appellants accept that there was an issue as to how the Department came to have knowledge of the step-father's criminal record and that his Honour found that there was some informal contact with the police. However, they submit that informal contact with the police does not equate to reporting to the police in the relevant sense (referring to his Honour's reasons at [47], [93], [102]). It is submitted that the primary judge gave persuasive reasons for rejecting the respondent's case on the issue as to whether or not reporting had actually occurred. They note that Ms Quinn's evidence on this issue was based entirely on reconstruction.
2. The appellants emphasise the primary judge's finding that, if reported, it would have been extremely likely that the step-father would have been charged ([56]) and submit that his Honour was entitled to take into account, as he did, the evidence given concurrently of the expert criminal lawyers, particularly that of the former Director of Public Prosecutions (Mr Cowdery QC) that the police would almost certainly have acted on a complaint made in the appellants' circumstances. They submit that that opinion powerfully supports the inference which the primary judge drew that no complaint was made to police.

Determination

1. The lack of records (from the CMU, the Department or elsewhere) meant that direct proof of notification or a lack of notification to the police could not be established. There certainly was no record of any notification. Nor could Ms Quinn (the case officer most closely involved in the case albeit not the officer with the primary responsibility in the Blacktown office to have made such a notification) recall the making of such a notification. It might perhaps have been thought likely for someone in her position, expressing such a level of concern as to the risk of harm to the children, to have recalled if such a notification had been made though there can be no criticism given the lapse of time that she was unable to recall one way or the other whether a notification had been made. Similarly, her apparent readiness, at the time of the criminal proceedings, to proceed on the assumption that there had been no notification to the police points at the very least to her not having had a strong recollection of that kind to the contrary.
2. In those circumstances, his Honour was faced with determining, on the balance of probabilities, whether (as the Department had contended and the respondent still contends his Honour should have found) notification to the police had in fact been made.
3. Looked at in simple terms, there was on the one hand evidence by officers of the Department as to their usual practice when allegations of serious child abuse were made (consistent with the content of the inter-departmental guidelines as to the protocol or procedures generally to be followed in such a case) and, on the other hand, there was a dearth of evidence to suggest that the police took any step at all in relation to the matter (beyond the fact that a police prosecutor was involved in the conduct of the Children's Court proceedings and had provided a copy of the step-father's police record).
4. Not only was the step-father not charged with any offence (which might have been explicable if there were concerns as to ability of the appellants to withstand the stress of a trial) but there was also no evidence of even the most cursory investigation by the police at the time. So, for example, there was no evidence of any interview being undertaken by a member of the CMU or other police officer with either of the children or their mother (let alone of any interview with the step-father himself). Had there been one or more interviews of that kind, it seems unlikely that the Department officers in charge of the case would not have been made aware of it; and had that happened it seems unlikely that reference to it would not have been somewhere in the reports put before the Children's Court.

Grounds 16 and 17 of the grounds of appeal - damages

1. The final two grounds of appeal (grounds 16 and 17) go to the contingent findings made by the primary judge as to damages.
2. The appellants submit that the primary judge erred in apportioning damages, in circumstances where he treated the loss as indivisible and where it is said that the respondent did not discharge an evidentiary onus to adduce evidence of the extent to which damage to them was caused otherwise than as a result of the Department's breach of duty. They contend therefore that the damages assessed by the primary judge should not be discounted, whether by 70% (as his Honour found) or any other percentage.

Relevant findings

1. The primary judge concluded (at [181]) that the correct approach was to treat the harm suffered by each of the appellants, and all of its consequences, as indivisible. His Honour also considered that there could be doubt that, had there been ongoing sexual abuse, those further assaults would have materially contributed to the totality of the harm suffered ([181]). However, this did not mean that the appellants were entitled to receive damages for the whole of their loss (at [182]). In the circumstances his Honour considered that the appropriate course was to apply the principle discussed by Ipp JA in Seltsam Pty Ltd v Ghaleb [2005] NSWCA 208 at [101], on the basis that the injuries TB and DC had sustained also resulted from abuse for which the respondent had no legal responsibility ([182]). In his Honour's view, the appellants would have sustained injury even if the Department not been negligent. Over compensation could be avoided by applying an "across the board" discount to the damages that would otherwise have been awarded had the State's negligence been the sole cause of the appellants sustaining injuries. This approach was appropriate given the difficulty of evaluating the significance of the pre-existing abuse for each of the various heads of damage (at [185]).

Appellants' submissions

1. The appellants rely on the principles articulated in Watts v Rake [1960] HCA 58; (1960) 108 CLR 158 and Purkess v Crittenden [1965] HCA 34; (1965) 114 CLR 164 for the proposition that where the plaintiff's loss was indivisible, there was an evidentiary onus on the defendant (here, the respondent) to establish what portion of the loss was caused by a cause for which the defendant was not liable.
2. In Watts v Rake, Dixon CJ said at 160: If the disabilities of the plaintiff can be disentangled and one or more traced to causes in which the injuries he sustained through the accident play no part, it is the defendant who should be required to do the disentangling and to exclude the operation of the accident as a contributory case. If it be the case that at some future date the plaintiff would in any event have reached his present pitiable state, the defendant should be called upon to prove that satisfactorily and moreover to show the period at the close of which it would have occurred. For myself I do not think that he has proved more than that at an earlier time than other men the plaintiff would have reached a stage of disability but not the same disability.
3. In Purkess v Crittenden, Barwick CJ, Kitto and Taylor JJ referred to Watts v Rake and said at 168-169: We understand that case to proceed upon the basis that where a plaintiff has, by direct or circumstantial evidence, made out a prima facie case that incapacity has resulted from the defendant's negligence, the onus of adducing evidence that his incapacity is wholly or partly the result of some pre-existing condition or that incapacity, either total or partial, would, in any event, have resulted from a pre-existing condition, rests upon the defendant. In other words, in the absence of such evidence the plaintiff, if his evidence be accepted, will be entitled to succeed on the issue of damages and no issue will arise as to the existence of any pre-existing abnormality or its prospective results, or as to the relationship of any such abnormality to the disabilities of which he complains at the trial... it is not enough for the defendant merely to suggest the existence of a progressive pre-existing condition in the plaintiff or a relationship between any such condition and the plaintiff's present incapacity. On the contrary it was stressed that both the pre-existing condition and its future probable effects or its actual relationship to that incapacity must be the subject of evidence (i.e. either substantive evidence in the defendant's case or evidence extracted by cross-examination in the plaintiff's case) which, if accepted, would establish with some reasonable measure of precision, what the pre-existing condition was and what its future effects, both as to their nature and their future development and progress, were likely to be. That being done, it is for the plaintiff upon the whole of the evidence to satisfy the tribunal of fact of the extent of the injury caused by the defendant's negligence. In the present case the evidence accepted by the learned trial judge by no means established with any reasonable degree of precision the extent of the appellant's pre-existing affliction or what its future effects, apart from the result of the defendant's negligence, were likely to be. That being so we think it was proper for him to deal with the case on the basis that the defendant's negligence was the cause of the appellant's permanent disability and, accordingly, we propose to deal with this appeal on the same basis.

Respondent's submissions

1. The respondent submits that there was ample evidence before the court below that the onset of the appellants' diagnosable psychiatric injury occurred as a result of the events in 2005 (the "trigger" provided by the criminal proceedings); not by reason of a pre-existing condition in the sense described in Watts v Rake and Purkess v Crittenden. In any event, it argues that to the extent that it had any evidentiary onus to adduce evidence of the extent to which, assuming liability, damage suffered by the appellants was due to a pre-existing condition, that burden had been discharged.
2. The respondent points to the joint opinion of the psychiatric experts that the cause of mental harm in respect of both appellants was the "childhood sexual abuse itself". It notes Dr Champion's opinion that TB's behavioural changes (as identified by Dr Diamond following the April 1983 notification to the Department) were likely to have been related to the assaults as then notified to the Department, and to Dr Diamond's opinion that it was in 2005 that TB developed the chronic post-traumatic stress disorder which now incapacitated her. In the case of DC, reference is made to Dr Champion's opinion to similar effect. The respondent maintains that both the appellants were in a position of vulnerability prior to 1 August 2005, but that prior to that time they had no ongoing psychiatric disorder. It submits that there was a level of agreement between the medical experts in respect of both TB and DC that the particular events of 2005 were, in themselves, a substantial trigger either "fully" manifesting the appellants' mental condition or giving rise to it. It maintains that the underlying condition that the primary judge said had been made manifest on the confrontation with the step-father was itself a recognised psychiatric illness within the meaning of Pt 3 of the Civil Liability Act (referring to the passages in his Honour's reasons at [187], [189], [190]).
3. The respondent submits that his Honour's approach in apportioning damages was not misconceived and refers to what was said in Tabet v Gett [2010] HCA 12; (2010) 240 CLR 537 by Hayne and Bell JJ (agreeing with Kiefel J) (at [66]), namely: For the purposes of the law of negligence, "damage" refers to some difference to the plaintiff. The difference must be detrimental. What must be demonstrated (in the sense that the tribunal of fact must be persuaded that it is more probable than not) is that a difference has been brought about and that the defendant's negligence was a cause of that difference. The comparison invoked by reference to "difference" is between the relevant state of affairs as they existed after the negligent act or omission, and the state of affairs that would have existed had the negligent act or omission not occurred. (emphasis in original) (footnotes omitted)

Supplementary submissions as to damages

1. The appellants' supplementary submissions as to the calculation of damages summarised the areas of disagreement between the respective parties as to the heads of damages accepted by the primary judge and indicated that, in the event that the appeal were to be allowed, the parties did not wish to be heard in relation to the question of damages beyond those submissions. Annexed to the supplementary submissions were two schedules setting out the calculations of damages based on the findings of the primary judge. The parties accept that the respective schedules set out the ultimate damages calculation which each party contends would be consistent with the heads of damages accepted by the primary judge.
2. In essence, there is agreement as to the calculations in relation to all but three heads of damage: non-economic loss; interest on past loss of superannuation; and interest on past out of pocket expenses.

Non-economic loss

1. The issue in contention between the parties on this aspect of the matter relates to whether, having regard to the outcome of the appeal, this Court is involved in a re-assessment of the damages such that the approach in Nicholson v Nicholson (1994) 35 NSWLR 308 (at 315F, 332F and 334E) would require the adoption of the most recent non-economic loss figures as the basis for the calculation. The appellants argue that in that event the Court should calculate non-economic loss on the basis that the applicable figure for the most extreme case is $594,000 (not the figure used by the primary judge - $572,000).
2. The respondent accepts that if the appellants are successful in relation to the Watts v Rake issue then it is open to the Court to re-assess damages and, as such, to adopt the non-economic loss calculation contended for by the appellants but it submits that if the appeal is allowed only on grounds other than grounds 16 and 17 of the amended notice of appeal, with the consequence that the Court confirms the 70% reduction contingently determined by the primary judge, then the Court is not involved in re-assessing damages and therefore the approach adopted in Nicholson v Nicholson does not apply.

Interest on past loss of superannuation

1. As to interest on past loss of superannuation, the appellants argue that this is available as a matter of principle and they submit that an allowance for such interest is implied in the comments made by the primary judge at [220]. The respondent on the other hand points to the fact that the primary judge, though making express provision for interest on past loss of earning capacity ([220]), did not make any express provision for interest on past superannuation. The respondent contends that it does not follow that the award of such interest is either available as a matter of principle or implied in his Honour's reasons.

Interest on past out of pocket expenses

1. Similarly, the appellants argue that such interest is available as a matter of principle and prima facie is allowable on the past out-of-pocket expenses discussed by the primary judge. They submit that interest should apply from the average date of accrual of the respective past out of pocket expenses. The respondent, as it does in relation to the previous disputed head of damage, argues that it does not follow that such interest is available as a matter of principle or that the primary judge intended such an award. The respondent notes that the primary judge made no provision for interest on past out of pocket expenses and submits that there is no evidence that the amounts were actually paid.
2. In summary, the difference in the total of the damages calculation taking into account the difference in the parties' positions on those three heads of damage (and assuming that the 70% reduction contingently determined by the primary judge is confirmed) is, in the case of TB, $15,776 and, in the case of DC, $7,521.

Determination

1. In my opinion, it cannot be said that his Honour erred in concluding that had there been further ongoing sexual abuse in the post-notification period this would have made a material contribution to the appellants' harm. So much is evident from Dr Diamond's supplementary report. His first report (which suggested that all the harm was attributable to pre-April 1983 events) must be understood in the context that it proceeded on the mistaken assumption, corrected by reference to Dr Szyndler's report, that the whole of the abuse occurred in the period to April 1983.
2. The appellants submit that Dr Diamond's view was that the post-traumatic stress disorder had arisen prior to the 2005 criminal trial but manifested itself at the time of the trial, and that part of the cause of the evolution of that disorder was the step-father's ongoing abuse post-April 1983. Dr Diamond did not identify the onset of the psychological damage, it being accepted by the experts that the appellants only became aware of their condition after the acute onset of symptoms following the criminal trial. Dr Diamond did, however, state the opinion that chronic post-traumatic stress had arisen "at the time of the abuse and continued through to the present with some exacerbation at the time of the Court hearing". The appellants point out in this context that there was no evidence of the behavioural disorders (in particular, DC's bed-wetting and TB's self-harm) prior to April 1983.
3. I am not persuaded that the respondent adduced evidence that established what portion of the harm or damage was harm or damage to which the post-April 1983 abuse had contributed (for the purposes of satisfying the evidential burden imposed by Watts v Rake) though the respondent certainly adduced evidence which established that there was another contributing cause to the ultimate harm, i.e., a cause that went beyond the Department's negligence.
4. However, insofar as the appellants rely on the respondent's failure to discharge the Watts v Rake evidentiary onus as entitling them to the whole of their damages, there is a tension between the Watts v Rake and Purkess v Crittenden line of authority on the one hand and that considered in and following Malec, as pointed out by Professor Luntz, Assessment of Damages for Personal Injury and Death (4th ed, 2003, LexisNexis Butterworths).
5. At [1.9.11] in that text, Professor Luntz, discussing the principle derived from the House of Lords decision in Bonnington Castings Ltd v Wardlaw [1956] AC 613; 1 All ER 615 (that where an external cause may also have contributed to the plaintiff's condition, the onus of proving causation was satisfied once the plaintiff proved that the defendant had contributed materially to the condition, and where it was impossible to apportion the loss the plaintiff would recover the full amount of its loss; thus there being an evidential onus on the defendant to disentangle the causes (and see the discussion at [1.9.10])), argues that logically the application of the principle of Malec where there is an external contributing cause to indivisible loss would require the Court to evaluate the chance that the harm would have occurred without the defendant's contribution and to reduce the damages recoverable from the defendant accordingly. While it is noted at [1.9.11] that an argument to that effect was rejected in Commonwealth v McLean (1996) 41 NSWLR 389 at 410-411, Professor Luntz postulates (at fn 662) that the "innocent" cause there was one that in any event would be taken into account when making an allowance for contingencies or vicissitudes.

Orders

1. I propose the following orders: 1. Appeal allowed. 2. In each of proceedings 2008/289325 and 2008/289326 set aside the judgment entered in favour of the first defendant and the orders made on 22 May 2015 by Campbell J (other than the order in relation to the costs of the second defendant of the respective proceedings to the extent that the second defendant has incurred costs separate from those of the first defendant in defending the proceedings) and in lieu thereof order 1. in both proceedings that judgment be entered for the plaintiff against the first defendant. 2. in proceedings 2008/289325 (in which the plaintiff is DC) order the first defendant to pay to the plaintiff damages in the sum of $536,463.60 plus the sum of $790 for interest on past out of pocket expenses (the interest on past out of pocket expenses subject to provision to the respondent's legal representatives of evidence of actual payment of those expenses). 3. in proceedings 2008/289326 (in which the plaintiff is TB) order the first defendant to pay to the plaintiff damages in the sum of $939,435.60 plus the sum of $4,022 by way of interest on past out of pocket expenses (the interest on past out of pocket expenses subject to provision to the respondent's legal representatives of evidence of actual payment of those expenses). 1. Submissions in relation to the question of costs of the appeal and of the proceedings below (no more than 3 pages) to be filed by the parties within 7 days, with the intent that costs orders will be made on the papers. 2. Liberty to the parties to apply within 3 days if there is any arithmetical error in the calculation of the amounts, having regard to these reasons, in accordance with the respective schedules submitted with the supplementary submissions.
2. SACKVILLE AJA: I agree with the orders proposed by Ward JA and, subject to the following, with her Honour's reasons.
3. Both the appellants and the State challenged the contingent assessment of damages by the primary Judge for the injuries attributable to the State's breach of duty. The challenges raise issues concerning losses that are said to be attributable to two causes, one of which gives rise to a right to compensation from a defendant while the other does not.

The Civil Liability Act

1. The question of causation is governed by ss 5D and 5E of the Civil Liability Act 2002 (NSW) (CL Act). [117] They relevantly provide as follows: "5D General principles (1) A determination that negligence caused particular harm comprises the following elements: (a) that the negligence was a necessary condition of the occurrence of the harm ( factual causation ), and (b) that it is appropriate for the scope of the negligent person's liability to extend to the harm so caused ( scope of liability ). … (4) For the purpose of determining the scope of liability, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party. 5E Onus of proof In proceedings relating to liability for negligence, the plaintiff always bears the onus of proving, on the balance of probabilities, any fact relevant to the issue of causation." These provisions were not referred to in the parties' written submissions but were referred to in oral argument.
2. As the High Court pointed out in Wallace v Kam, [118] a determination in accordance with s 5D(1)(a) that the defendant's negligence was a necessary condition of the occurrence of harm is entirely factual and turns on proof by the plaintiff of the relevant facts on the balance of probabilities in accordance with s 5E. By contrast, a determination in accordance with s 5D(1)(b), that it is appropriate for the scope of the negligent person's liability to extend to the harm caused, is entirely normative and turns on a consideration of the matters identified in s 5D(4).
3. It appears to be common ground that s 5E of the CL Act is consistent with the principles established by Watts v Rake [119] and Purkess v Crittenden [120] and that those principles continue to apply to claims governed by the CL Act. The joint judgment in Purkess v Crittenden stated the position as follows: [121] "[W]here a plaintiff has, by direct or circumstantial evidence, made out a prima facie case that incapacity has resulted from the defendant's negligence, the onus of adducing evidence that his incapacity is wholly or partly the result of some pre-existing condition or that incapacity, either total or partial, would, in any event, have resulted from a pre-existing condition, rests upon the defendant. In other words, in the absence of such evidence the plaintiff, if his evidence be accepted, will be entitled to succeed on the issue of damages and no issue will arise as to the existence of any pre-existing abnormality or its prospective results, or as to the relationship of any such abnormality to the disabilities of which he complains at the trial. … [In Watts v Rake] it was stressed that both the pre-existing condition and its future probable effects or its actual relationship to that incapacity must be the subject of evidence (i.e. either substantive evidence in the defendant's case or evidence extracted by cross-examination in the plaintiff's case) which, if accepted, would establish with some reasonable measure of precision, what the pre-existing condition was and what its future effects, both as to their nature and their future development and progress, were likely to be. That being done, it is for the plaintiff upon the whole of the evidence to satisfy the tribunal of fact of the extent of the injury caused by the defendant's negligence." [Emphasis added.]

The Post-April 1983 Abuse

1. The primary Judge found that the correct approach was to treat the harm suffered by each of the appellants and all of the consequences of that harm as "indivisible". [122] The word "indivisible" rather suggests that no distinction can be drawn between the effects of the pre-April 1983 abuse and the post-April 1983 abuse on the psychiatric condition sustained by each appellant. This was not, however, a proposition accepted by his Honour and it is clear that his finding was intended to convey that the post-April 1983 sexual abuse materially contributed to the totality of the harm suffered by each of the appellants. [123] As his Honour found, that harm included serious psychiatric injury in the form of post-traumatic stress disorder (PTSD).
2. Ms Wass SC, who appeared with Mr Harvey for the State, submitted that the medical evidence did not support the primary Judge's finding that the post-1983 abuse (including the post-1983 Departmental neglect) materially contributed to the appellants' psychiatric disabilities. In terms of s 5D(1)(a) of the CL Act, I understood the submission to be that the appellants had not proved on the balance of probabilities that the State's negligence was a necessary condition of the occurrence of harm. In particular, Ms Wass contended that Dr Diamond, a consultant psychiatrist whose reports were tendered on behalf of the appellants, had not directed his attention to whether the post-April 1983 sexual abuse materially contributed to the psychiatric condition of each appellant. For this reason, so Ms Wass contended, it was not open to the primary Judge to find that the State's breach of duty was a necessary condition of the psychiatric harm sustained by each appellant.
3. In my opinion, the State's submission paid insufficient attention to the joint report prepared by Dr Diamond and Dr Champion, the psychiatrist whose reports were tendered on behalf of the State. In the joint report, Dr Diamond stated that the chronic PTSD experienced by each of the appellants arose at the time of the abuse and continued until the joint conference took place. While Dr Diamond found that the appellants' respective psychiatric conditions were exacerbated by the confrontation with their abuser at his criminal trial in 2005, both experts agreed that the cause of the illnesses experienced by the appellants was the childhood sexual abuse itself. The experts also agreed that the long term nature of the sexual abuse and the appellants' inability to be protected from or escape the abuse constituted significant causes of the disease or impairment in each case.

The State's Liability for Damages

1. Having accepted that the post-April 1983 abuse (and the failure of the authorities to prevent that abuse) materially contributed to each appellant's psychiatric condition, the primary Judge pointed out (at [182]) that this did not mean that the appellants were entitled to be compensated for the entirety of their psychiatric disabilities. His Honour said that it was necessary to acknowledge that their injuries also resulted from the pre-April 1983 abuse, for which the Department (and the State) had no legal responsibility.
2. The primary Judge accepted that the State bore the burden of adducing evidence showing that the appellants suffered from a pre-existing condition at the time the breach of duty occurred. [127] Although his Honour did not explain in detail why he considered that the State had discharged that burden, it is evident that he found that the State had done so. He observed that this was not a case where the appellants were "merely subject to some susceptibility of injury but for the [State's] negligence". In his view, it could not seriously be argued that no injury at all would have occurred had the State not breached its duty of care to the appellants. [128] His Honour concluded that overcompensation could be avoided by applying a discount of 70 per cent on the damages that would have been awarded if the State's negligence had been the sole cause of the appellants' harm.
3. I did not understand the appellants to contend that the State had failed to adduce evidence capable of establishing that the pre-April 1983 abuse suffered by the appellants had contributed to their respective psychiatric conditions. In any event, the evidence of Dr Diamond, to which I have referred and which the primary Judge accepted, was capable of establishing that the pre-April 1983 sexual abuse materially contributed to the underlying psychiatric conditions suffered by the appellants.
4. The submission advanced by Mr Morrison SC, who appeared with Mr Pryde and Mr Morrissey for the appellants, was that the evidence did not justify the primary Judge distinguishing between the consequences of the pre-April 1983 and post-April 1983 abuse. Mr Morrison contended that neither Dr Diamond nor Dr Champion had attempted to identify the extent to which the pre-1983 abuse (for which the State was not responsible) caused the harm suffered by the appellants. He attached particular weight to the observation made in the joint judgment of the High Court in Purkess v Crittenden stating that a defendant, in a case such as the present, must adduce evidence which, if accepted, would "establish with some reasonable measure of precision" what the pre-existing condition was and what its future effects are likely to be. [129]

Additional Observations

1. Since preparing the foregoing, I have had the opportunity to read Basten JA's judgment. I make the following points, which accord with the views expressed by Ward JA.
2. I did not understand the State to challenge the proposition that the Director's powers or duties under s 148B(5) of the Child Welfare Act 1939 (NSW) (CW Act) had been enlivened. The Notice of Contention does not seek to uphold the primary Judge's decision on the ground that his Honour should have found s 148B(5) was not engaged.
3. In the primary Judge's summary of his decision, [136] the first conclusion is stated as follows: "The Department owed each of TB and DC a duty actionable under the law of negligence to use reasonable care in the exercise of its powers conferred by s 148B(5) CW Act."
4. In argument before this Court, Ms Wass stated that this conclusion was "of course, uncontroversial". [137] Ms Wass then contended that s 148B(5) did not assist the appellants because the Director had a discretion to report abuse to the police and the State's duty to take reasonable care was not breached by the Director's failure to exercise his discretionary power. Ms Wass did not argue that the Director did not have power to report the abuse to the police. Her position was consistent with the State's Notice of Contention which is drafted on the assumption that the State had a legal duty to take reasonable care in the exercise of its powers under s 148B(5) of the CW Act.
5. In any event, the State did not dispute that it owed a duty of care to the appellants that required it to exercise reasonable care in the exercise of its statutory powers, including those conferred by s 148B(5) of the CW Act. While the Notice of Contention did challenge the finding that the State breached its duty of care by omitting to notify the police of the abuse suffered by the appellants, the existence of a duty of care was not in dispute.
6. The State's challenge to the finding of breach of duty did not raise questions of principle, but was fact specific. The principal contention advanced by the State was that the evidence did not justify the primary Judge's finding that the Department had failed to report the abuse to the police. Ward JA has addressed that argument in detail.
7. The State did not contend that the finding that Ms Quinn had not breached the duty of care she owed to the appellants meant that the Department could not be found to have breached its duty of care to the appellants. The primary Judge distinguished Ms Quinn's position from that of the Department in a passage which was not challenged on appeal: [138] "I am not of the view that the District Officer owes any corresponding or concurrent duty. I accept that as a social worker the District Officer, like other professionals, may owe a duty of care to persons to whom she provides professional services … But this is not the current field of discourse. The case pleaded and argued against the District Officer is that she owed the [appellants] duties having the same content as the duty asserted to be owed by the Department. In my judgment, this is misconceived. The specific statutory powers, the existence and engagement of which are essential, but insufficient, conditions of the imputation of the duty, are conferred upon the Director of the Department and not upon its individual and subordinate officers, even if in other areas (for example s 76 CW Act), authorised officers may have independent functions or powers."

Endnotes

1. Repealed, 29 May 1987, by the Miscellaneous Acts (Community Welfare) Repeal and Amendment Act 1987 (NSW), s 3.
2. TB v State of New South Wales; DC v State of New South Wales [2015] NSWSC 575 (Campbell J). (Paragraph numbers used below are those to be found in the on-line version, not in the hard copy provided to the parties.)
3. Second further amended statement of claim, par 52(a).
4. Second further amended statement of claim, pars 46 and 52.
5. Bowman v Farnell (1886) 7 NSWR 1; Farnell v Bowman (1887) 12 App Cas 643; Maguire v Simpson (1977) 139 CLR 362.
6. Second further amended statement of claim, par 53.
7. Judgment at [111].
8. Second further amended statement of claim, par 56.
9. Judgment at [7].
10. Judgment at [32].
11. Appellants' submissions in reply, 15 February 2016, par 31.
12. (2007) 234 CLR 330; [2007] HCA 42.
13. Dederer at [47].
14. Dederer at [43].
15. (1998) 192 CLR 431; [1998] HCA 5.
16. cf Nagle (1993) 177 CLR 423 at 429-430.
17. Romeo at [149].
18. A "young person" was aged 16-18; a child was under 16. As the appellants were under 16 at the time of the alleged negligence it is sufficient to refer to the provisions as they applied to children.
19. Child Welfare Act, s 4(1) "Uncontrollable".
20. Child Welfare Act, s 73.
21. Child Welfare Act, s 78.
22. Child Welfare Act, ss 133 and 134.
23. Child Welfare Act, s 146(1).
24. See marginal note.
25. Child Welfare Act, s 4(1), "Director".
26. Judgment at [19].
27. [1943] 2 All ER 560.
28. See Clarke v Bailey (1933) 33 SR (NSW) 303 at 309 (Davidson J, Street CJ and James J agreeing).
29. (1935) 35 SR (NSW) 182 at 188-189.
30. These construction issues appear to have been resolved in the current law, being Ch 3 of the Children and Young Persons (Care and Protection) Act 1998 (NSW).
31. Board of Fire Commissioners of New South Wales v Ardouin (1961) 109 CLR 105.

Amendments 10 August 2016 - Typographical error to Headnote DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 15 August 2016