Hess v Seaside City Developments Pty Ltd - [2022] NSWSC 855 - NSWSC 2021 case summary — Zoe

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Hess v Seaside City Developments Pty Ltd

[2022] NSWSC 855

Supreme Court of NSW|2021-04-23|Before: Garling J

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At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2021-04-23

Before

Garling J

Catchwords

[1990] HCA 11 Collins v Clarence Valley Council (2015) 91 NSWLR 128
[2015] NSWCA 263 Day v Ocean Beach Hotel Shell Harbour Pty Ltd (2013) 85 NSWLR 335
[2013] NSWCA 250 Garzo v Liverpool/Campbelltown Christian School [2012] NSWCA 151 Leichhardt Municipal Council v Montgomery (2007) 230 CLR 22
[2007] HCA 6 Nominal Defendant v Cooper [2017] NSWCA 280 Perera v Genworth Financial Mortgage Insurance Pty Ltd (2017) 94 NSWLR 83

Source

Original judgment source is linked above.

Catchwords

[1990] HCA 11 Collins v Clarence Valley Council (2015) 91 NSWLR 128[2015] NSWCA 263 Day v Ocean Beach Hotel Shell Harbour Pty Ltd (2013) 85 NSWLR 335[2013] NSWCA 250 Garzo v Liverpool/Campbelltown Christian School [2012] NSWCA 151 Leichhardt Municipal Council v Montgomery (2007) 230 CLR 22[2007] HCA 6 Nominal Defendant v Cooper [2017] NSWCA 280 Perera v Genworth Financial Mortgage Insurance Pty Ltd (2017) 94 NSWLR 83Miller v Lithgow City Council (2015) 91 NSWLR 752

Judgment (12 paragraphs)

[1]

Judgment

On 28 January 2017 at about 9.50pm, the plaintiff was riding a motorcycle south in Cylinders Drive in an area known as Seaside City, south of Kingscliff in the north of NSW. At the intersection of Cylinders Drive with Edgewater Lane, the plaintiff collided with an area of pavement which extended from the eastern side of the road ("the butterfly chicane"). He was dislodged from his motorcycle and suffered serious injuries to his head, back, right hip and pelvis and ribs.
On 6 August 2020, the plaintiff commenced proceedings against three defendants: 1. Seaside City Developments Pty Ltd - the first defendant ("Seaside"); 2. Richtech Pty Ltd - the second defendant ("Richtech"); and 3. Cardno (Qld) Pty Ltd - the third defendant ("Cardno").

[2]

Notice of Motion

On 8 February 2021, the second defendant, Richtech, filed a Notice of Motion which sought the following orders: "1 An order pursuant to rule 13.4 of the Uniform Civil Procedure Rules 2005 that the plaintiff's claim for relief against the second defendant be struck out. 2 Alternatively, an order pursuant to rule 14.28(1) of the Uniform Civil Procedure Rules 2005 that the following paragraphs of the Statement of Claim filed 6 August 2020, and any claim for relief sought against the second defendant by reason of those paragraphs be struck out: i. Paragraph 3; ii. Paragraph 12, the word 'second'; iii. Paragraph 14, the word 'second'; iv. Paragraph 16, the word 'second'; v. Paragraph 17, the word 'second'; vi. Paragraph 18, the word 'second'; and vii. Paragraph 18 the word 'second'. 3 An order that the plaintiff pay the second defendant's costs of and incidental to this Motion, and any costs thrown away by reason of the above-mentioned paragraphs being struck out."
At the commencement of the hearing on 23 April 2021, counsel for Richtech, who also appeared for Seaside, noted that the words "struck out" at the end of Order 1 were inserted in error and that the word "dismissed" should be substituted for them. Having regard to the terms of r 13.4 of the UCPR, this correction was appropriate to be made.
Thereafter, Richtech proceeded to seek summary dismissal of the proceedings against it and, in the alternative, that the parts of the Statement of Claim identified in the Motion be struck out.
At the conclusion of argument on the Notice of Motion, the plaintiff made an application for an adjournment in order to enable him to prepare, and seek leave to file, an Amended Statement of Claim.
Orders were made for the service of any proposed Amended Statement of Claim, and the proceedings were stood over for directions. On 4 June 2021, it became apparent that the second defendant opposed a grant of leave to file the proposed Amended Statement of Claim. Accordingly, the application of the plaintiff to file a proposed Amended Statement of Claim and the Notice of Motion of Richtech, which was part-heard, were both stood over for a final hearing on 9 July 2021.
It is appropriate to record at this stage that the third defendant, Cardno, did not oppose or consent to the relief being sought by either Richtech, in its Notice of Motion, or the plaintiff, by its application for leave to file the proposed Amended Statement of Claim, and put no submissions with respect to the proceedings.
As Seaside and Richtech were represented by the same firm of solicitors and by the same counsel, it can be taken that all submissions put by the lawyers were put on behalf of both of these defendants.

[3]

Background Facts and Circumstances

It is necessary to give some factual background to the proceedings before coming to discuss the claims that were made.
The following facts and circumstances emerged from the evidence. Richtech, which was incorporated in 1989, acquired the majority of the lots of land in a coastal community in northern NSW known as "Seaside City". By May 2010, Richtech owned 174 of the 204 lots in the Seaside City area. Prior to 2007, Seaside City consisted of bushland which had been the subject of sand mining. There were three small houses constructed on individual lots which had been built to facilitate mining activities. There was only one constructed road within Seaside City - which was then called Tweed Coast Road.
The lots had been created as a consequence of a subdivision plan lodged in the 1920s, although none had been built upon, and the roads necessary for these subdivisions were not constructed at that time.
Seaside was incorporated in March 2007. According to the evidence of Mr Bruce Barclay, a director of both Richtech and Seaside, the reason for the incorporation of Seaside was to undertake development work in relation to the land owned by Richtech and to undertake civil works within the Seaside City area. Those works are said to have included the construction of roads and services, including the connection of electricity, water and sewerage.
In March 2007, Richtech was granted development consent for the Seaside City area, after an appeal to the Land and Environment Court of NSW. The development, which was the subject of the grant of consent, was to be for a mixed-use community incorporating a village centre precinct, a coastal dwellings precinct, a coastal multi-dwellings housing precinct, a coastal units precinct, a tourist accommodation precinct and a public open space network. Each of these precincts and network was displayed on a plan.
For present purposes, it is sufficient to note that the development was to be staged and that Stage 1 was to include the construction of Lorna Street, which became known as Cylinders Drive, and the unnamed Crown road at the southern end of the site which, after construction, became known as Windsong Way. The consent also required a concrete footpath of a minimum 1.2m wide to be constructed along both sides of Cylinders Drive.
At the time relevant to these proceedings i.e., January 2017, both Seaside and Richtech had the same two directors, namely Mr Ronald Ian Barclay and Mr Bruce Hamilton Barclay. Both companies had their registered office at the same location in Queensland - which was the address of the Barclay Group. Although the legal title of the shares were not identical, they were substantially so. It is clear that the legal shareholders of each company were respectively part of the Barclay Group because the registered address of each of the shareholders was at the Barclay Group premises. There is no evidence as to whom the beneficial shareholders, if any, were.
According to Mr Barclay's evidence, Richtech and Seaside entered into a written agreement described as a "Development Agreement" in which they each agreed between themselves what their respective roles in the overall development would be.
In evidence is an undated but executed copy of the Development Agreement. It is the evidence of Mr Bruce Barclay that the Agreement was entered into by Richtech and Seaside prior to any of the works described in it being undertaken.
Mr Barclay's evidence propounds the effect of the Agreement as that Seaside was to perform the development works as head contractor to the exclusion of any other person or entity. He says that the purpose of the Development Agreement was to take the responsibility for the development of the Seaside City project away from Richtech. His evidence does not provide any reason for such an arrangement. There is no evidence as to whether this internal arrangement was ever made known outside of the Barclay Group of companies.
There was also in evidence an agreement entitled "Seaside City Planning Agreement" which was executed on 9 January 2007 by Richtech, as the developer, and the Tweed Shire Council, as the approval authority. That Planning Agreement noted that the Seaside City area was located along the Tweed Coast, approximately three kilometres south of Kingscliff. It comprised a 32-hectare parcel of land which, having been approved for subdivision in the 1920s, comprised 205 titled lots. At the time of the making of that Agreement, Richtech was recorded as owning 85% of the lots.
Richtech agreed, in that document, to carry out the works in accordance with the Development Consent which had been granted for the purpose of providing amenities or services to the public within an identified period. It also agreed to dedicate the passive open spaces noted on the approved plans. The Council for its part agreed to pay monies, to be calculated according to a particular formula, to Richtech for the work which it carried out and which benefited lots other than those owned by Richtech.
The schedule to that Planning Agreement required Richtech as the developer to provide the land dedicated for open space and for roads, to construct roadworks and landscaping, and to provide all professional consultant fees and earthworks. Included in the roadworks were the streets which are now combined and known as Cylinders Drive. They were component parts of the total roadworks and landscaping which was estimated to cost a little over $2.7M.
On 3 December 2007, Cardno, the third defendant in the proceedings, applied to the Tweed Shire Council for a Construction Certificate for the subdivision work. It did so on behalf of the owner which was Richtech.
Mr Barclay deposed in his affidavit to the fact that Seaside carried out all of the development works, including engaging various consultants to undertake the development works - one of which was Cardno.
He said this: "17. One of the tasks undertaken by [Cardno] for Seaside City Developments was liaising with Tweed Shire Council in respect of the Council's requirements in relation to the making up and design of Cylinders Drive. As Seaside … had retained [Cardno] for this purpose, it did not have any direct involvement in the negotiation of the requirements of Tweed Shire Council in relation to the design of or the manner in which Cylinders Drive was constructed as that was [Cardno's] responsibility."
Mr Barclay expressed his view that except for its ownership of the landholding, Richtech had no involvement in the development works.
Evidence adduced by the plaintiff included the Planning Agreement to which earlier reference has been made. The plaintiff's evidence also included a further application described as an "Application for Works As Executed Compliance Certificate" which was made by Cardno to the Tweed Shire Council on behalf of Richtech as the owner of the relevant lots.
It also included a Certificate dated 14 January 2011, supplied by Cardno, certifying that various plans had been prepared in accordance with Tweed Shire Council's requirements, and that the works, including any changes, were noted on the relevant plans. That document recorded Cardno's client as being Seaside. It referred to and included plans of the road that became Cylinders Drive. It also included plans for water reticulation, a sewerage pump station, cycleways and walkways.
The evidence filed by the plaintiff also included material demonstrating that comprehensive subpoenas to produce had been served in 2020 on each of Seaside and Richtech seeking the production of documents variously described which related to the design and construction of the butterfly chicane at the intersection of Cylinders Drive and Edgewater Lane, Kingscliff. The documents required to be produced included any relevant development applications and consent approvals and certificates; all documentation passing between the subpoena recipient and Tweed Shire Council relating to that design and construction; and all documentation passing between the subpoena recipient and any contractors involved in the construction or design of the chicane.
In respect of each of those subpoenas, the solicitors for Seaside and Richtech wrote to the Court informing the Registrar of the Court that no documents were produced by Seaside or Richtech in answer to either subpoena. The solicitors for both explained this: "We are instructed by our client that the documents which are the subject of the subpoena relate to construction work which took place 9-10 years ago. The documents which our client did have in its possession have since been destroyed and it is not in a position to produce any documents which are the subject of the subpoena."

[4]

Proposed Amended Statement of Claim

The proposed Amended Statement of Claim pleads a claim in negligence against each of Seaside, Richtech and Cardno. As against Seaside and Richtech, the plaintiff pleads that each owed him a duty in the following terms: "… a duty to likely future users of the road such as the plaintiff to ensure the [butterfly chicane] extension and its surrounds were designed and constructed in a fashion that did not present a foreseeable risk of injury to likely users of the road such as the plaintiff."
The foreseeability element as against Richtech was addressed in almost identical terms as that referable to Seaside and was pleaded in this way: "At all material times the second defendant knew or ought to have known that it was likely the road would ultimately be used in sub-optimal visibility conditions by road users such as the plaintiff and failed to ensure the foreseeable risk that was presented by ensuring the design and construction of the [butterfly chicane] and its surrounds was addressed."
The other two necessary elements as set out in s 5B(1)(b) and s 5B(1)(c) of the Civil Liability Act 2002 were pleaded in substantially identical terms against each of Seaside and Richtech.
The particulars of breach of duty as against each of Seaside and Richtech are in identical terms. Each of these particulars deals with failures alleged in the design and construction of Cylinders Drive, the butterfly chicane and its surrounds, including a failure to ensure in the planning, design and construction stages of the development the proper positioning of street lighting in the area of the butterfly chicane. Other particulars address varying specific issues such as the sub-optimal visibility conditions creating a need for particular design features, the failure to erect warning signs in advance of the butterfly chicane, the failure to use particular paint to highlight the butterfly chicane, and the failure to design the butterfly chicane so as to include mountable kerbs which would enable motor vehicles and motorcycles to remain under control when colliding with the raised kerbs.
As yet, and appropriately, neither Seaside nor Richtech have either filed a Defence to the proposed amended pleading. They have not provided to the Court any draft Defence in the event that the pleading was permitted to be filed. It will only be appropriate for them to do that if the plaintiff is granted leave to file the proposed pleading.
I do note, however, that in Seaside's defence to the original Statement of Claim, it admits that it engaged Cardno to design part of the subdivision and the additional roads required in the area known as Seaside City and to undertake associated engineering design works. However, it denies that the development which it undertook included obtaining approval for Cylinders Drive because it said that the road was, at all relevant times prior to the development, an existing unmade public road.
Richtech filed a similar pleading. It also admits that it was the owner of a variety of parcels of land, all of which excluded the public road which is now called Cylinders Drive. In its Defence it denied: "… any and all involvement in any development of any part of the locality known as Seaside City at all".
It is convenient to first consider the application by the plaintiff for leave to file a proposed Amended Statement of Claim. The issue of whether the claim ought be summarily dismissed as against Richtech should follow the determination of the pleading issue.

[6]

Plaintiff's Submissions

The plaintiff submitted that the proposed amended pleading was adequate in form to reflect the principles respecting claims brought to which the Civil Liability Act applies and also that, in accordance with the principles relating to adequate pleading, the proposed Amended Statement of Claim was sufficient to inform Richtech of the case which it has to meet at trial, and sufficient to enable it to file a defence.
In the course of discussion with the Bench, it became apparent that the plaintiff would define the risk of harm in the circumstances pleaded as being: "The risk of harm, in respect of which the [first or second] defendant was required to take reasonable precautions, was the risk of a road user such as the plaintiff suffering injury from a collision with the [butterfly chicane] in sub-optimal visibility conditions."
Counsel submitted that that risk of harm was sufficiently pleaded in each of paragraphs 20 to 25 in respect of Seaside and paragraphs 30 to 35 in respect of Richtech and that a separate pleading of risk of harm was not essential to enable Richtech or Seaside to understand the case which they have to meet.
The plaintiff submitted that, whilst it may be that Seaside and Richtech were identified in the earlier pleadings as developers, the current pleading, permissibly, describes their role as not being limited to developers but rather, having regard to factual circumstances, being relevantly responsible for the proper execution of the design, construction and council approval and certification status of the overall development. In particular as against Richtech, the plaintiff submits that the pleading identifies Richtech as being the party responsible for obtaining council approval and, ultimately, for the construction of the roads within the development.
Finally, the plaintiff submitted that the proposed pleading links the butterfly chicane to being part of the development, thereby giving rise to a duty of care towards the plaintiff and other road-users.
The plaintiff pointed out that, based upon the evidence produced, Seaside and Richtech were both engaged in various steps towards the development of the Seaside City area which would enable a conclusion that they were both engaged jointly with the same aim, namely the development and sale of the Seaside City area, and acted in concert and that, therefore, the way in which in the pleading is expressed is sufficient to cover liability arising from those facts.

[7]

Discernment

Subject to one matter to which I will come, it seems to me that the pleading adequately sets out a factual basis upon which it could be said, if it is proved at trial, that each of Seaside and Richtech owed a duty of care to the plaintiff with respect to the risk of harm arising from the existence of the butterfly chicane on the road. It may well be that the third defendant is also liable but, as a matter of pleading, that is beside the point.
The principles with respect to pleading a claim generally and under the Civil Liability Act have been discussed on many occasions.
In Banque Commerciale SA (En Liqn) v Akhil Holdings Ltd (1990) 169 CLR 279 at 286; [1990] HCA 11, Mason CJ and Gaudron J said: "The function of pleadings is to state with sufficient clarity the case that must be met … In this way, pleadings serve to ensure the basic requirement of procedural fairness that a party should have the opportunity of meeting the case against him or her and, incidentally, to define the issues for decision. The rule that, in general, relief is confined to that available on the pleadings secures a party's right to this basic requirement of procedural fairness."
At 296, Dawson J said: "It is of course the purpose of pleadings to define the issues between the parties so that they may know the case which they have to meet and in order that the proceedings upon trial may be conducted in an orderly fashion by reference to those issues. The defined issues provide the basis upon which evidence may be ruled admissible or inadmissible upon the ground of relevance."
In my view, the proposed pleading is generally adequate to inform the defendants of the case which is to be made against them. It will be a matter for evidence as to whether or not the plaintiff can establish his case against each of Seaside and Richtech. However, having regard to the general nature of the overall Seaside City project, in my view the pleading is not so confused or complex as would deny to either Seaside or Richtech a fair trial.
The one matter to which careful attention needs to be paid is that any pleading seeking to establish a claim under the Civil Liability Act needs to ensure that the risk of harm is identified and specifically pleaded because such a risk of harm informs the existence of, and content of, a properly pleaded duty of care.
In Garzo v Liverpool/Campbelltown Christian School [2012] NSWCA 151, Basten JA said at [7]: "Section 5B of the Civil Liability Act 2002 (NSW) requires identification of a risk of harm, against which a person has failed to take precautions. Given its context, the risk must be that which materialised in the case of the injured person seeking a claim in negligence. That is because s 5B is dealing with a breach of duty of care, being the duty of care owed by the defendant to the injured plaintiff."
In Uniting Church in Australia Property Trust (NSW) v Miller; Miller v Lithgow City Council (2015) 91 NSWLR 752; [2015] NSWCA 320, Leeming JA said at [102]-[103]: "Central to the determination of civil liability for failure to exercise reasonable care and skill is the identification of risk … [because] the [Civil Liability Act] makes liability dependent upon the identification of the risk of harm." See also Shoalhaven City Council v Pender [2013] NSWCA 210 at [68]-[72]; Port Macquarie Hastings Council v Mooney [2014] NSWCA 156 at [50]-[52]; Collins v Clarence Valley Council (2015) 91 NSWLR 128; [2015] NSWCA 263 at [126]-[135].
Finally, I draw attention to the decision of Nominal Defendant v Cooper [2017] NSWCA 280 - a case dealing with a motor vehicle accident where, at [89], Payne JA described the proposition that the issue of breach of duty could not be properly considered unless the relevant risk of harm was first identified or characterised with adequate precision as being "an uncontroversial proposition".
In my view the proposed pleading does not identify separately the essential element of risk of harm. It does not in that respect accord with the proper pleading for a claim under the Civil Liability Act.
I would propose to allow the pleading, but subject to an amendment in which the plaintiff pleads separately with adequate precision the relevant risk of harm.

[8]

First and Second Defendants' Submissions

Seaside and Richtech first submitted that the plaintiff's allegations for vicarious liability against each of them cannot succeed as a matter of law because the pleading seeks to hold each of Seaside and Richtech accountable vicariously for the conduct of a separate contracting party, Cardno, or else each other, in fulfilling contractual arrangements.
The submission of Seaside and Richtech is that the claim that both of them can be vicariously liable for the conduct of Cardno must fail because, based upon such decisions as Day v Ocean Beach Hotel Shell Harbour Pty Ltd (2013) 85 NSWLR 335; [2013] NSWCA 250 at [33], the law does not permit dual vicarious liability.
As well, Seaside and Richtech submitted that the evidence adduced in support of Richtech's application for summary dismissal demonstrates beyond argument that the proper sequence of facts connected with the development of the Seaside City area, and the construction of the butterfly chicane, shows that: 1. Richtech and Seaside entered into a development agreement by which Seaside was to carry out the development of Seaside City area; 2. Cardno was engaged by Seaside to plan, design and obtain approval for the Seaside City development which included, relevantly, the butterfly chicane; and 3. the construction was undertaken by an entity known as See Civil Pty Ltd, which was itself an independent contractor retained by Seaside.
Richtech submitted that there was nothing within the contractual arrangements that would suggest that it, being entirely unrelated to the construction contractor, exercised any authority or control in relation to any decision relating to the butterfly chicane at all. It submitted that there is nothing in the facts by which the Court could ever be satisfied that Richtech had any authoritative or controlling role in respect of planning, design or construction. It submitted there was no material to indicate that anything was done at any stage by any party for which Richtech was the principal. It submitted that, fundamentally, there is simply no case against it and that it is an appropriate case in which to enter a judgment for it and to summarily dismiss the plaintiff's case.

[9]

Plaintiff's Submissions

The plaintiff submitted that the question of fact as to what each of Seaside and Richtech, which both form part of the same Barclay Group of companies and were closely related, actually did in relation to the development of the Seaside City area is not so clear as to enable summary dismissal.
The plaintiff pointed to the fact that it is one thing for closely related companies within the same group to make internal arrangements for their own purposes as to what each might do in the pursuit of a particular development, but it is a different question as to what duty each of those companies, having regard to what they actually did, owed to a member of the public of the kind which the plaintiff pleads in this case.
The plaintiff pointed out the fact that Richtech itself applied for various approvals from the Tweed Shire Council, and had Cardno apply on its behalf for other statutory requirements. The plaintiff pointed to the fact that the absence of any documents produced on subpoena by either Seaside or Richtech, together with the solicitor's explanation that such documents do not exist, is indicating that the context of the question as to what each company did is a matter which must necessarily depend ultimately on what evidence is produce by those parties and the inferences which the Court ought draw with respect to it.
The plaintiff submitted that the affidavit of Mr Barclay, far from closing the issue of fact out sufficiently for summary dismissal purposes, in fact poses issues which demonstrate that he should not be barred from proceeding against both Richtech and Seaside. The plaintiff added that the closeness of the companies is demonstrated by the fact that both companies in these proceedings are represented by the same solicitors and the same counsel.
The plaintiff relied upon a decision of the Court of Appeal, Strategic Formwork Pty Ltd v Hitchen [2018] NSWCA 54, where at [16] Basten JA said: "The plaintiff sought to demonstrate that the companies were two arms of a single family business with no clear demarcation between their management structures. Even if that were so, it did not follow that [one company] had day-to-day control over the operations of [the other company]. On the other hand, [the first company] contended that the management structures reflected the legal separation of functions and operations. However, even if that were so, it would not necessarily follow that [the first company] did not owe a duty of care to the plaintiff. Neither the formal employment relationships, nor the separation of corporate structures, precludes the possibility that one entity may exercise a degree of control over activities carried on by another, such as to give rise to a duty of care …"

[10]

Discernment

The principles to be considered before the court grants either summary judgment or else summarily dismisses a claim, are clear and of long-standing. The ordinary course of litigation will generally be allowed to take place. That is because a litigant with a proper cause of action is entitled to expect that they will not be denied the opportunity, after taking advantage of the usual interlocutory processes, to put their case before the court for judicial determination on the merits. However, there are rules which exist to balance those ordinary expectations with the right of an opposing party not to be vexed by litigation in which it can be said that no reasonable cause of action is disclosed.
The Court needs to exercise caution and to be satisfied with the certainty of the outcome of litigation rather than considering an assessment of prospects of success: Perera v Genworth Financial Mortgage Insurance Pty Ltd (2017) 94 NSWLR 83; [2017] NSWCA 19 at [30].
In Pi v Zhou [2016] NSWCA 24, Gleeson JA said at [9] this: "It may be accepted that the power to order summary dismissal is one that should be exercised with great care and not unless it was clear that there is no real question to be tried. The test to be applied has been variously expressed, including: 'So obviously untenable that it cannot possibly succeed'; and 'manifestly groundless', but the underlying point is that there must be a high degree of certainty about the ultimate outcome of the proceedings if it were allowed to go to trial or a hearing in the ordinary way: Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552; Batistatos v Roads and Traffic Authority (NSW) [2006] HCA 27; (2006) 226 CLR 256 at [46]; Spencer v Commonwealth [2010] HCA 28; (2010) 241 CLR 118 at [24]-[25] (French CJ and Gummow J)."
It is against these principles that Richtech's application for summary dismissal must be considered.
It is convenient to first deal with the issue of dual vicarious liability.
The submission of Richtech that the common law of Australia does not permit dual vicarious liability and that, accordingly, the plaintiff cannot succeed on its claim against Richtech as being vicariously liable for the conduct of Cardno because Seaside is also sued in that respect does not in my view determine the question of summary dismissal.
The decisions discussed by Leeming JA in the judgment of Day v Ocean Beach Hotel Shellharbour Pty Ltd are those concerning the conduct of an employee and an employer. The principle of law discussed related to whether, given that an employer is vicariously liable for the conduct of an employee carried out in the course of or for the purposes of the employment, a third party can also be vicariously liable for the conduct of that employee. That is a different question from circumstances where it is not the conduct of an employee specifically which is in issue, but rather the conduct of corporations related by contract can give rise to the liability in more than one corporation for the conduct of a third corporation.
The doctrine of vicarious liability lacks, it has been said, "any single unifying and principled explanation": Leichhardt Municipal Council v Montgomery (2007) 230 CLR 22; [2007] HCA 6 at [156] per Hayne J.
In those circumstances, it seems to me that, at least applying the restrictions on dual vicarious liability as it presently stands, the Court may be precluded from finding against Seaside and Richtech that they were both vicariously liable for the conduct of those who constructed the butterfly chicane. However, that does not preclude a plaintiff bringing the case against both of them in the expectation that it will establish liability against either one. In other words, properly understood, the claim for vicarious liability is in the alternative.
For that reason, I would not be prepared to summarily dismiss the vicarious liability head of claim.
I accept that the evidence establishes, as I have earlier outlined, that within the Barclay Group of companies, Seaside was allocated the role of being the developer.
However, I am not satisfied that this question of fact is so clear and so certain that it would be held that Richtech had no role to play in the development of the Seaside City area. Particularly is this so having regard to the fact that it applied for and obtained the Development Consent from the Land and Environment Court of NSW for an extensive development of the area of Seaside City, which was to be a staged development and which included the construction of the road which became Cylinders Drive and a footpath beside it which was at least 1.2m wide.
In those circumstances, I am not prepared to conclude that on no basis could Richtech be liable to members of the public who use the road which was constructed pursuant to a Development Consent which it held.
It follows that this is not a case in which summary dismissal ought be granted.

Hess v Seaside City Developments Pty Ltd

At a glance

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Decision date

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Catchwords

Source

Catchwords

Judgment (12 paragraphs)

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Legislation Cited (1)

Cases Cited (24)