Porter v. Lachlan Shire Council [2006] NSWCA 126

Court of Appeal (NSW)|2006-04-24|Before: Beazley JA, Giles JA, Hodgson JA

CITATION: Porter v. Lachlan Shire Council [2006] NSWCA 126

JUDGMENT OF: Beazley JA at 1; Giles JA at 2; Hodgson JA at 3

DECISION: 1. Appeal dismissed. 2. Appellant to pay the respondent's costs of the appeal.

LEGISLATION CITED: Civil Liability Act 2002, s.45 Roads Act 1993, Dictionary

CASES CITED: Leichhardt Council v. Serratore [2005] NSWCA 406

PARTIES: James Stanley Porter - appellant Lachlan Shire Council - respondent

COUNSEL: Mr. B.J. Gross QC with Mr. D. Williams for appellant Mr. D. Davies SC with Mr. S.McCarthy for respondent

SOLICITORS: Matthews Williams, Parkes for appellant Phillips Fox, Sydney for respondent

LOWER COURT JURISDICTION: District Court

LOWER COURT MEDIUM NEUTRAL CITATION: Not applicable

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA40227/05 DC 955/04

BEAZLEY JA GILES JA HODGSON JA

Wednesday 24 May 2006 PORTER V. LACHLAN SHIRE COUNCIL HEADNOTE FACTS The appellant suffered a fractured right ankle when he accidentally put his foot into a hole in the nature strip between the made footpath and the gutter of a street in Condobolin.

At about the time of the accident, the Lachlan Shire Council was engaged in a project of resurfacing the area in question, and there was evidence that two Council officers had inspected the area about one year earlier, at a time when the hole was already there. However, that evidence was not within particulars of negligence given by the appellant, and the judge refused the Council's application for adjournment made on the basis that the Council was not in a position to cross-examine or answer that evidence.

The primary judge held that, but for s.45 of the Civil Liability Act 2002, he would have found the Council liable on the ground that it should have known about the hole; but he was not satisfied that the Council had actual knowledge of it. The appellant appealed, inter alia on the ground that s.45 did not apply, and the Council cross-appealed inter alia against the refusal of the adjournment. HELD (1) Section 45 of the Civil Liability Act applied, on either of two bases: the nature strip was part of a road work which the Council failed to maintain, and filling the hole would be a road work which the Council failed to construct or install.

(2) The refusal of the adjournment was within the primary judge's discretion, but it meant that the appellant could not rely on the absence of cross-examination or evidence in reply to remedy shortcomings in the evidence led by him.

(3) In those circumstances, although actual knowledge can be proved by inference, there was no error in the primary judge's conclusion that actual knowledge had not been established, or in his reasons. ORDERS

Appeal dismissed.
Appellant to pay the respondent's costs of the appeal.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40227/05 DC 955/04

BEAZLEY JA GILES JA HODGSON JA

Wednesday 24 May 2006 PORTER V. LACHLAN SHIRE COUNCIL Judgment

2 GILES JA: Subject to one observation, I agree with Hodgson JA. I am more firmly of the view that non-economic loss could not have exceeded 20 per cent of a most extreme case, and may have been prepared to intervene. It is not necessary to come to a decision.

3 HODGSON JA: In proceedings in the District Court of New South Wales, the appellant sought damages against the respondent, and also against Country Energy, in respect of injuries sustained when he fell into a hole in a footpath at Condobolin. On 3 May 2005, the primary judge gave judgment in favour of both defendants, but provisionally assessed damages at $113,029.00. The appellant appealed from that decision against the respondent only. The respondent has put on a cross-appeal, challenging the allowance of some evidence and the refusal of an adjournment, and also challenging the assessment of damages.

CIRCUMSTANCES 4 On 22 March 2003 at about midnight, the appellant, then aged 18, suffered a fractured right ankle when he accidentally put his foot into a hole, which he did not see, in the nature strip between the made footpath and the gutter and road surface of William Street, Condobolin.

5 Photographs taken on 21 May 2003, about two months after the accident, show a hole that appears to be approximately circular, about 30 centimetres or a little more in diameter, with steep sides, and perhaps about 20 centimetres deep. The hole was quite close to the end of a structure described in evidence as an electricity substation, which appears to be about 90 centimetres wide, about 1.5 metres high and about 2 metres long. One side of this structure was parallel with and quite close to the main footpath; and the other side appears to have been about 1 metre from the gutter and road surface.

6 The accident occurred in the vicinity of property owned by Condobolin Aboriginal Health Service, and subsequently to the accident there were extensions and renovations to buildings on that property. In association with those works, the respondent did work on the footpath along William Street, extending past the location where the accident occurred. Photographs taken in 2005, shortly before the hearing, show the footpath in the area paved all the way between the buildings and the gutter, with one style of paver alongside the substation and past the location where the accident occurred, changing to another style of paver at a telegraph pole about 2 metres beyond the substation.

7 Also in evidence were three photographs taken by the appellant's father about two weeks after the accident. These showed the area of the fall, but did not show the hole itself. They showed grass that was quite long, that could possibly have obscured the hole. The photographs taken in May 2003, by contrast, showed sparse grass not obscuring the hole at all.

STATUTORY PROVISIONS 8 The case concerns among other things the application of s.45 of the Civil Liability Act 2002, which is in the following terms: 45 Special non-feasance protection for roads authorities (1) A roads authority is not liable in proceedings for civil liability to which this Part applies for harm arising from a failure of the authority to carry out road work, or to consider carrying out road work, unless at the time of the alleged failure the authority had actual knowledge of the particular risk the materialisation of which resulted in the harm. (2) This section does not operate: (a) to create a duty of care in respect of a risk merely because a roads authority has actual knowledge of the risk, or (b) to affect any standard of care that would otherwise be applicable in respect of a risk. (3) In this section: carry out road work means carry out any activity in connection with the construction, erection, installation, maintenance, inspection, repair, removal or replacement of a road work within the meaning of the Roads Act 1993 . roads authority has the same meaning as in the Roads Act 1993 .

9 The Roads Act 1993 has the following definitions in its dictionary: footway means that part of a road as is set aside or formed as a path or way for pedestrian traffic (whether or not it may also be used by bicycle traffic).

public road means: (a) any road that is opened or dedicated as a public road, whether under this or any other Act or law, and (b) any road that is declared to be a public road for the purposes of this Act.

road includes: (a) the airspace above the surface of the road, and (b) the soil beneath the surface of the road, and (c) any bridge, tunnel, causeway, road-ferry, ford or other work or structure forming part of the road.

road work includes any kind of work, building or structure (such as a roadway, footway, bridge, tunnel, road-ferry, rest area, transitway station or service centre) that is constructed or installed on or in the vicinity of a road for the purpose of facilitating the use of the road as a road, the regulation of traffic on the road or the carriage of utility services across the road, but does not include a traffic control facility, and carry out road work includes carry out any activity in connection with the construction, erection, installation, maintenance, repair, removal or replacement of a road work.

roads authority means a person or body that is, by or under this Act, declared to be a roads authority and, in relation to a particular public road, means the roads authority for that road.

COURSE OF PROCEEDINGS 10 The Statement of Claim filed on 10 March 2004 contained the following allegations in pars.1, 3, 4, 5, 6, 7 and 10: 1. At all relevant times the First Defendant had the care, control and management of the footpath and pedestrian walkways in William Street, Condobolin. 2. … 3. On or about 22nd March 2003 the Plaintiff tripped and fell down a hole near the power box in the footpath/walkway of William Street, Condobolin, causing injuries, losses and damages. 4. The hole was created by the Defendants or one or other of them. 5. The Defendants or one or other of them had knowledge of the existence of the hole and failed to repair it. 6. The hole was concealed and/or obscured and constituted a form of trap to pedestrians such as the Plaintiff. 7. The Defendants or one or other of them had actual knowledge of the risk having been informed of it prior to the Plaintiff/s accident. 8. … 9. … 10. PARTICULARS OF NEGLIGENCE a) Creating a hole which constituted an unreasonable risk to pedestrians such as the Plaintiff. b) Causing and/or permitting the grassed area to remain a trap to pedestrians such as the Plaintiff. c) Causing and/or permitting a hole to be left unattended or without a proper barricade giving rise to an unreasonable hazard. d) Failing to provide any or any proper warning to the Plaintiff of the existence of the hazard or of the risk of injury. e) Failing to ensure that any holes were covered or adequately fenced or barricaded so as to avoid risk of injury. f) Being aware of risk to pedestrians such as the Plaintiff failing to take reasonable steps to remedy the risk.

11 On 13 May 2004, the respondent's solicitors requested particulars of the appellant's claim, and in relation to par.7 asked the following questions: 15. Is it alleged the First Defendant had actual knowledge of the existence of the hole prior to the Plaintiff's fall. 16. If the answer to 15 above is yes, please advise: 16.1 Whether the First Defendant was notified in writing or orally: 16.2 If in writing, please provide us with a copy of any document purporting to notify the First Defendant. 16.3 If orally, please provide us with details of any conversations which took place including date, time, who notified the First Defendant and who on behalf of the First Defendant was notified and what was said at the time.

12 On 9 July 2004, the appellant's solicitors responded that this was "a matter for evidence".

13 On 27 July 2004, the respondent's solicitors wrote saying inter alia: We also note your client's replies to questions 15 to 28 as being matters for evidence. In our opinion, particulars in relation to alleged prior complaints and the allegations of negligence are not matters for evidence. If your client intends to rely on the allegations in relation to prior complaints and negligence, please provide your client's replies to questions 15 to 28 by no later than 30 July 2004 as provided for in the Agreed Timetable handed to the Court or, 14 July 2004.

14 After a follow-up letter from the respondent's solicitors of 24 September 2004, the appellant's solicitors replied on 8 October 2004 to the following effect: 15. During 2001 a person named as Olivia Singh employed by the Aboriginal Health Service in Condobolin fell in the same hole on the way to work. It will be alleged that this was reported to the Defendants by an employee of the Health Service. The precise date and circumstances of such report or reports are not known at this stage. The Plaintiff reserves his rights to give further particulars when the records of the Defendants are produced. It is a matter for evidence whether both Defendants had actual knowledge of the existence of the hole prior to the Plaintiff's fall. Please advise your instructions. However, since the Plaintiff's injury the First Defendant has filled in the hole and paved the area.

15 The respondent's Defence was filed on 1 November 2004, and par.4 denied pars.4, 5, 6 and 7 of the Statement of Claim, in so far as those paragraphs were pleaded against the respondent.

16 Meanwhile, on about 21 October 2004, the appellant's solicitors had served a subpoena on the respondent returnable on 8 November 2004. This subpoena does not appear to have gone into evidence before the primary judge, although a subpoena served on Country Energy did. No documents were produced by the respondent on 8 November 2004. It appears that this subpoena was not answered until 10 or 11 February 2004, when documents were produced including documents relating to the re-development of the Condobolin Aboriginal Health Service and the paving of the footpath. Those documents included a site landscaping plan showing the area of footpath, signed by the Council's Director of Environmental Services and apparently dated 19 February 2003, and showing the paving to be carried out; and also an invoice for pavers for the footpath apparently ordered by the Council on 6 March 2003.

17 No further particulars were supplied by the appellant.

18 On 23 February 2005, five days before the hearing commenced on 28 February 2005, the respondent's solicitors wrote to the appellant's solicitors saying inter alia: We understand it will be alleged by the Plaintiff a complaint was made to both Defendants following a fall on the footpath in William Street by Olivia Singh.

After receiving particulars of the alleged complaint under cover of your letter dated 8 October 2004 we have carried out investigations in relation to this alleged complaint, including the issuing of a subpoena for production on Condobolin Aboriginal Health Service who we understand made the complaint which was returnable in the District Court at Sydney on 17 January 2005.

Our investigations are now complete. Accordingly, we put you on notice of our client's intention to rely on section 45 of the Civil Liability Act (2002) in its defence of this claim.

19 Evidence was given for the appellant at the hearing by a Mr. Read, who was Manager of Condobolin Aboriginal Health Service in 2000 and 2001. He gave evidence concerning the attendance at the site by employees of Country Energy, which is no longer relevant; and also of an occasion when a cleaner Olivia Singh tripped in the hole, and he reported this by telephone to Country Energy. However, Mr. Read did not give evidence that he reported this incident to the respondent.

20 Then Mr. Read proceeded to give evidence concerning the proposals for extensions to the Condobolin Aboriginal Health Service building and the repaving of the footpath, and the evidence went on: Q. Did you subsequently have some on-site inspections in William Street, Condobolin? A. Quite a few. Inspections went on but there was quite a few people involved as well.

Q. Did you have any inspections of the site in William Street - sorry, could you tell us about those inspections that you had. A. First we wanted to put a stairway in and that couldn't happen, so then we talked about where we were going to extend the building, and then there was couple of council workers there. There was people from--

Q. Why were the council workers involved? A. Well, they just went over where all the building was going to be and there was also a--

Q. Which council are you talking about? A. It was Lachlan Shire Council. That covers a pretty big area out there.

Q. Was the council going to contribute or do any work in connection with the extensions? A. Yeah, where the - they'd just done a beautifying of the main street, and then the pavers came around from Bathurst Street to William Street and they basically cut off to the front of where the power box was, I think it was, and then in the restructure--

Q. What was the council going to do? OBJECTION (McCARTHY). FORM.

Q. When these council workers came, where did you go in your inspection with them? A. We walked up and down the footpath in around where the other structures were and what had to come out and where everything was going to go and how the old laundromat had to be knocked down.

Q. What was the reason for walking up and down the footpath with the council workers? A. Just--

Q. Where did you walk - if you could answer that question. A. Just right along, like, William Street to the end of the lane to where the footpath was going to be extended out from the building.

Q. Who was going to extend the footpath? A. It was going to be a joint project with the Aboriginal Health Service and Lachlan Shire Council.

Q. In walking the footpath, where did your inspection of the footpath start and end? A. Just, like, down on William Street, just really right along the--

Q. Where did it start in William Street? A. Where the pavers ended. They said, "This is where we're going to extend, and this will be concrete, even paved," and then what had happened when the building was finished and the paving from the building right out to the curve and guttering then.

Q. Is that what you say was a joint project between the builders and the Aboriginal Service" and the Lachlan Shire Council? A. Yeah, well, there was--

Q. When you inspected the footpath with the Lachlan Shire Council workers, was the hole still there adjacent to the power box? A. It would have been still there but it wouldn't have been as deep.

OBJECTION (McCARTHY). HIS HONOUR: Just half a second, please. Q. Was the hole still there? Can you answer that yes or no. A. Yes. WILLIAMS: Q. Was it clearly visible?

21 Mr. McCarthy for the respondent objected to this evidence, and the primary judge overruled that objection, giving the following reasons: The defendant seeks to rely on section 45 of the Civil Liability Act, and I will return to that. The objection is made on the basis that the defendant cannot meet this evidence. They did not know that it was to be led and to meet it they would have to carry out other investigations.

It seems to me that the first defendant was put fair and square on notice of this claim when the statement of claim was filed. They had the ability to investigate it and obviously did, because on 1 November they deny paragraph 5, they deny paragraph 7 and the solicitor signs a certificate. When there are further particulars sought and an answer is given on 8 October, that answer, in my view, would clearly alert the first defendant to the fact that the plaintiff was alleging by way of evidence that the defendants had actual knowledge of the existence of the hole prior to the fall and indeed that work had been done in this area.

It was also always in my view within the knowledge of the first defendant themselves that work had been done in and about this area. Therefore, I am of the opinion that the plaintiff is entitled to pursue this line with this current witness and to adduce that evidence and, providing the evidence is admissible, I will be allowing it.

22 Following that decision, Mr. Read's evidence continued as follows: WILLIAMS: Q. Mr Read, over what period were you the, manager of the Aboriginal Legal Service again? A. About two years.

Q. What were those two years, what years were they? A. Pretty sure it was 2000, 2001 I think, and I left there early 2002. I'm not quite sure, but.

Q. You've told the court that these inspections I think happened in early 2001, can you be more precise than that?

OBJECTION (McCARTHY). LEADING. QUESTION REPHRASED. HIS HONOUR: Q. Could you tell us when you think these inspections took place? A. I'm near pretty sure it was 2001.

Q. Do you remember when in 2001? A. No, not really, your Honour.

Q. Have you any idea what time during the year? Beginning, middle, late? A. I think it was towards the end of the year.

WILLIAMS: Q. We were speaking about the hole when you went outside and your evidence was that the hold was still there when you were with the council workers? A. Yes.

Q. You had stated it was clearly visible. Do you recall that? A. Yes.

Q. To the best of your knowledge, did the council subsequently provide pavers? A. Yeah, it's all paved and everything now.

Q. When was it paved? Can you give us a date roughly when you thought it was paved? Was that after you left the employment of the service? A. Yes, it was after I'd left, yeah.

23 At the commencement of the next day of the hearing, Mr. McCarthy said this to the primary judge: McCARTHY: Your Honour, Mr Read, I understand, is Mr Williams' last lay witness. Our inquiries haven't been able to find a way in which we can meet the allegations he makes. That puts me in a difficult position, your Honour, because I can't cross-examine the witness because I can't investigate the factual content of what he says. My principal application would be, your Honour, that we go as far as we can with Mr Ryan's evidence, if he's got some evidence to call. We continue to do as much as we can in order to meet the allegations, but ultimately, your Honour, I might be asking for an adjournment if I can't meet those matters.

24 He did not at that time cross-examine Mr. Read, but Mr. Read remained so as to be available for cross-examination if Mr. McCarthy obtained instructions that would enable that cross-examination. What later occurred is recorded as follows in the transcript: McCARTHY: That leaves me in a position where, I should address your Honour the issues arising from Mr Read's evidence. The position I'm in, your Honour, is that I can't meet the evidence today. Inquiries and investigations would need to be made, but particularly, your Honour, what my proposal would be, would be that an adjournment ensue. The first defendant then seek (sic) particulars from the plaintiff.

HIS HONOUR: Sorry, what evidence is it you can't meet.

McCARTHY: The evidence with respect to council officers being in the vicinity of the hole at some time in 2001 2002, in circumstances where they were walking with Mr Read and talking to him in that vicinity. We indicate, your Honour, that we don't know who those people are - of the possibilities, they are now spread far and wide and one is indeed, deceased. I don't know when he was deceased. So that's the factual difficulty, your Honour, I met with. I can say this to your Honour, also, that my submission will be, if your Honour refuses my application for an adjournment, that the evidence of Mr Read doesn't go so far as to disentitle me from a defence of section 45. Indeed, your Honour, what I would say would be--

HIS HONOUR: Sorry, but isn't that taking it a step further than--

HIS HONOUR: I understood you first sought an adjournment.

McCARTHY: It would be a matter of weeks, I would anticipate, your Honour. Just in order for your Honour to weigh up all the factors for and against my application, indicate, your Honour, that if it was not granted, I would still seek to rely upon the defence, and I would say that the plaintiff would need - I'll withdraw that. The plaintiff would need to make law on the point to succeed against my client. Yes, your Honour, because section 45 in my submission, this entitles the plaintiff from a knew or ought to know type scenario. It has to know about the hole. We say the evidence, as it is, hasn't got there, so we would still say that the defence is solid. However--

McCARTHY: It's not. There's nothing decided on the point.

HIS HONOUR: How could you say it had to make new law?

McCARTHY: Because what we would say, your Honour, perhaps--

HIS HONOUR: Do you mean you're putting forward an interpretation of it.

McCARTHY: Yes, your Honour, but your Honour is probably quite right.

McCARTHY: Your Honour would have to interpret the legislation in a way which I would say would be against the clear intention of - and then there would potentially be some law made thereafter, your Honour, with great respect. So that's the situation in which I'm in, your Honour. If your Honour was to find that the test under section 45 encompass an ought to know type scenario, and found against me on that basis, then, well obviously, I'd be in a situation that there would be prejudice arising from the refusal of an adjournment application. If granted, your Honour, I would seek to elicit evidence.

HIS HONOUR: Quite often prejudice arises from - that's not a reason not to refuse an application. You've got to weigh up everything.

McCARTHY: Absolutely, your Honour. Just a factor I'd put before the court.

HIS HONOUR: You still be arguing section 45. I'm aware of that, and I rule that you could.

McCARTHY: One way or another, I'll be arguing section 45 your Honour, but as a safety net, the application I would seek would be for an adjournment in order that I can speak to the people who might be able to meet the factual matters put, and cover my client's position one way or another.

HIS HONOUR: What other factual matters you say, have been raised? Is it that there was an inspection of this area, as there was to be a joint venture?

HIS HONOUR: Which as I understand it, was paving the area?

McCARTHY: I don't think so. That may be a part of it. There seemed to be some extensions to the Aboriginal Health Service.

HIS HONOUR: There were, but I, I might have been wrong, but I thought he was referring to some joint venture between the Aboriginal Legal Service and the Council.

HIS HONOUR: I didn't understand that to go as far as their extensions, but more this paving the area. It may not matter in the end. But paving the area is the important part, if that's part of it because obviously they would have looked at the area.

McCARTHY: That's what my learned friend would say. My witness and my friends would say, "We would never in that area or all," or they might say, "I was in the area and I saw nothing."

McCARTHY: Yes, your Honour. In terms of the application, I should also put forward these matters. Your Honour has before you the documents which passed between the solicitors as to particulars, so your Honour, in agitation of this application, I'd say that we were entitled to particulars as to these points. I know your Honour has been against me on a very similar application.

We are entitled to particulars. They weren't given, and we were taken by surprise when the evidence eventually came from Mr Read. And indeed, your Honour, you will note that it's not even the chronology although other factual matters are like the Olivia Singh complaint, et cetera.

So really the first we heard about it was when it came from the mouth of the witness.

WILLIAMS: The precise allegation was in fact foreshadowed in the various statement of claim that we were alleging that they knew and that they actually knew. It was stated clearly in particulars that a complaint had been made to the defendants. It was put widely because the statement from Olivia Singh actually said that Mr Read had informed, I think she said, the council, so at that stage, not - my friend corrects me there. But her statement was put in. Perhaps I could go to that. 2D5, just looking for my copy. What she said in 2D5 which was--

HIS HONOUR: Do you want me to have it or did you want it?

WILLIAMS: No, no. I've got my copy here, but if you could just look at what I'm referring to, your Honour, and this is what was available to my instructing solicitor. She went in to the Aboriginal Health Service and spoke to the Coordinator, Kevin Read and said, "You want to get that hole fixed out there, or you'll end up getting sued." He said, "It's not us, it's council. I've already spoken to them about it." I said, "They won't do anything--"

HIS HONOUR: I think you've got a bit of a problem there, because that part was objected to and you consented to it being left out.

McCARTHY: Indeed, your Honour, I'm sorry to interrupt my learned friend but that's in the context of--

McCARTHY: That's in the context also of Mr Read, who gave the evidence directly, saying that he informed the other defendant.

WILLIAMS: Yes, Mr Read did give that evidence. So in the particulars nevertheless, for whatever the reason, the particulars given were that the defendant or defendants, I'm not sure if it was in plural, I think it was plural because your Honour commented on it, had been informed and I think that's the reason my instructing solicitor answered in that way.

Your Honour, the defendants knew that these allegations were to be made. This case is now in its third day. I oppose the adjournment because of the, we say it should be finalised now and that the defendant should have been prepared to have met these allegations, albeit perhaps the precise content of the allegations from Mr Kevin Read was not anticipated by them in the way it was put.

But they had in their own documentation, produced plans approved by them for this precise area of the footpath to be paved and they produced invoices for payment of those pavers. So this was an area of the footpath that their own documentation discloses they had paved. The invoices produced, your Honour, I'll just see if I can find the references, but the invoices produced are for pavers purchased in one invoice in early 2003, and I think in the second invoice in 2004. Those plans they also produced, were on my reading of the date, approved by council, or at least the plans are dated early 2003.

With those records being produced by the first defendant, they ought to have been prepared to have someone here to explain how it is, they say, they didn't have actual knowledge of the state of this footpath in that area, which includes a hole, which Mr Read said at the time of those inspections, was clearly visible.

HIS HONOUR: What did he say, what was the evidence he gave about the council and the centre? Do you have a note of it?

WILLIAMS: I'll see if I can find my notes, your Honour, but I know he said the hole is clearly visible at the time of the inspection, and I have my notes here. He said, my notes were, "Council officers, or workers, inspected the footpath when the hole was clearly visible." That's one note and I have to just go to my other statement that I have here.

HIS HONOUR: Did he put that in context as to when that happened?

WILLIAMS: Yes, your Honour. Just a moment. He said in the year 2000, he commenced employment at the Condobolin Aboriginal Health Service, he said in January 2000. He left there in January 2002 to go to Parkes. He said in that two year period, he was the manager and he obtained funding, he went down to Parliament House on one delegation and obtained funding for extensions to the building. He said he had--

WILLIAMS: Two site inspections with council workers, I think he described them on one occasion and my friend might correct me on this if I'm wrong, but I think he described them as officers on one other occasion. They took place in William Street and he said, "They walked along from where the pavers ended," which is right at the southern end of the substation, that's evidence that has been given to that effect, and it's shown in fact where the pavers end in those photographs, exhibit D. He said, "They walked from there from where the pavers ended at the substation, down to the lane," which is basically the length of that first bit of land where the extensions were to take place.

I think he said there were a number of inspections, but certainly he said there were at least two, where they walked up and down the footpath, and he said there was a joint venture between the service and the council in regard to paving the footpath.

Your Honour, one of those exhibits in fact, exhibit 0 are Lachlan Shire approved plans which show the area in that planning stage that was to be paved with new pavers and it's not right down to the lane, that's only just, not a long area, but it takes in this exact area where this hole was and where he says, Mr Read, "The hole was still there, during those inspections. It was still clearly visible."

WILLIAMS: That's what we rely on to impugn knowledge of the hole on the first defendant, because there is nothing magical about this, your Honour. That same legislation which my friend refers to, talks of obvious risk being affixed upon the plaintiffs, if there is a defect in a road or a footpath.

HIS HONOUR: I wasn't so much concerned about the law at this stage, just as to what the evidence was you were relying on.

WILLIAMS: The evidence that would have alerted them to the fact that they should meet an argument they actually knew.

HIS HONOUR: But that's the evidence you'll be relying on in due course?

WILLIAMS: We rely on those two or several inspections. We had intended to rely on streets sweeping, but we abandoned that when it turned out it was just Lachlan Street, which ends at the corner.

HIS HONOUR: Okay, thank you. Is there anything further you wish to say about that?

HIS HONOUR: Is there anything you wish to say, Mr Ryan?

HIS HONOUR: In this matter there is an application for an adjournment made in an area which I perceive to be at the conclusion of all the other evidence. The application is that the matter be adjourned for some weeks to allow the first defendant to investigate whether one or more of their employees is available to give evidence as to an inspection that may or may not, have taken place of the area where the hole was situated and whether or not, if such inspection took place, the council officers knew of a hole in the area.

The adjournment is proposed on behalf of the plaintiff. Firstly, it is not the policy of this court to adjourn matters once they commence, except in unusual circumstances. There is very good reason for that. We cannot have judges going part-heard in cases when they are listed to hear other cases. It causes such a disruption to the system that it results in cases becoming not reached and those other litigants before the court suffering as a result of it. That policy of this court is well known. It's no secret to those that appear in this case.

Secondly, this is a matter I considered earlier. I made a ruling in relation to it, and I'm not going to go over all the reasons I gave, but in essence, they were this. The plaintiff pleaded in their statement of claim that the defendants, or one or other of them, had knowledge of the existence of the hole and failed to repair it. The first defendant who makes this application, filed the defence in which they denied such knowledge. That was accompanied by a certificate signed by the solicitor, Michael Edward Down, dated I November 2004.

As I said before, they were, whether they got their answers to particulars they wanted, or not, well and truly on notice that the plaintiff was making such an allegation and in my view, they have had full and adequate opportunity to investigate this matter and to investigate it long before it came here. There have been documents produced in this court and once they became available, a defendant would know that they had to be met if it became important to do so. In addition to this, this particular defendant had within its knowledge, the fact that certain work may or may not have been carried out in this area and if it was to be carried out, not only would approval be necessary, but an inspection would be necessary.

I see absolutely no reason why we should suddenly stop this case for some weeks, some weeks of course will turn into a lot longer than that, because I'm certainly not available for some time to continue hearing this case. That brings its own problems, problems which case (sic) difficulties when dealing with a case of this nature because of the elapse of time between when the evidence is heard and when it is resumed.

For all those reasons I am not prepared to grant an adjournment to the first defendant.

McCARTHY: As I indicated previously, I'm not in a position to do so.

HIS HONOUR: Then I take it that you will not be challenging any of his evidence?

McCARTHY: I'm not in a position to do so, your Honour, because I cannot put a--

HIS HONOUR: No, that's just not so. His evidence did not just go to one point. His evidence covered a huge area. He gave evidence for some considerable time and the position, the point which you have raised, covers one small part of his evidence. I repeat, do you wish to cross-examine him, or not?

HIS HONOUR: Is that then the conclusion of the evidence?

McCARTHY: Yes, your Honour. Your Honour, the difficulty is that, for instance, if I ask him, "Who were the council officers involved--"

HIS HONOUR: I'm sorry, I'm not sure what it's about. I've asked you whether you want to cross-examine him or not?

McCARTHY: I'll just make one submission, your Honour, then I'll answer you much more directly.

McCARTHY: In respect to your Honour's question. Had my application being acceded to, no doubt I would have needed to cross-examine the man. The position I'm in now, as I indicated previously in the case is that, for instance, if I ask him, "Who were the council officers?" and he says, "Joe Brown and someone else," what could I do about it, your Honour, you see? I'm in no position to challenge him on those matters not anything else which affects me, so with respect to the other matters which have been raised, your Honour, in my submission they don't affect my case.

HIS HONOUR: It's your decision, I'm only asking what you want to do.

McCARTHY: No, I appreciate that, your Honour, no. I'm prepared to just get some instructions. That's my case, your Honour, thank you.

DECISION OF PRIMARY JUDGE 25 In his final judgment in the case, the primary judge said this about Mr. Read's evidence: Mr Read also gave evidence that at the same time, or about the same time, the council and the Aboriginal Medical Service had a joint venture of types and apparently the centre was being remodelled and fixed up and at the same time pavers were being laid in this area. He said that two members of the council had inspected or walked along this area and that the hole would have been visible, but as I understand it, that is as far as it went, he did not actually draw it to their attention. He did not complain about it, he did not suggest something should be done. He had complained to the electricity company, but not to the council.

26 The primary judge found in effect that, but for s.45 of the Civil Liability Act, he would have found the Council liable: I think the council did have a responsibility and that they should have inspected this sort of area from time to time, should have been aware of a hole which had obviously been there for over a year and should have filled it in and I believe the plaintiff was taking care.

27 However, for the following reasons, the primary judge found in the respondent's favour on the basis of s.45: What I come back to is this, and I do not know whether anyone has had to deal with this before; certainly no-one has come across any authority. It is argued, on behalf of the plaintiff, that two members of the council, and I am satisfied this happened, walked past this area and that the hole was there and that it was well before the plaintiff's injury.

It is argued that that results in actual knowledge of the council of the particular risk which resulted in the harm. As I said, if I was deciding this prior to this Act, I would probably have been satisfied that the council knew or should have known of the existence of the hole. I am not sure that the mere existence of two council officers in the area would totally have convinced me of that, but certainly I would have been convinced that it was something that the council should have been aware of from their normal day-to-day activities.

However, it seems to me that I am precluded from making that finding under this Act. The problem I have here and, no doubt, it will in due course be dealt with, is what is meant by "actual knowledge." The word "actual" is defined in The Oxford Concise Dictionary as: "Existing in fact, real, present or current".

If, for instance, someone had written to the council, had said to them, "There is a hole in this area, it is dangerous," then I don't think there could be any dispute that they have actual knowledge. If someone had rung the council and said, "There is a hole in this area, it is dangerous," then they would have actual knowledge. If someone had written, or rung the council and said, "There is a hole in this area," I believe they probably would have had actual knowledge of the particular risk.

However, I have concluded that it is a matter which the plaintiff would have to satisfy the court on. I do not believe the plaintiff can so satisfy the court with evidence that two council employees walked past this area and that there was a hole there. I do not believe it goes as far as to allow me to make a finding that that is actual knowledge of the particular risk.

It has been argued, and I think it is a good argument, that even with knowledge that the council employees had been in the area, we do not know what the state of the hole was at that stage. Was it covered with grass? Was it visible? Was it in some way not within their vision? Did they see it? Did they not see it? It is something we simply do not know.

I therefore, with some reluctance, have to rule that section 45 must preclude the plaintiff from succeeding against the council. I have tried to put my views as clearly as possible, so as, if I am incorrect in that interpretation, then it should be easy for a court of appeal to come to another interpretation of the meaning of those words. That is, my feeling is, other than for section 45, the plaintiff would have succeeded against the council.

28 The primary judge dealt with damages as follows: I will briefly assess damages. There is not a great dispute in this case. The plaintiff, a good witness, I accept entirely, I accept his complaints, I accept what he says and what his father has said. He has got a nasty injury to his ankle. He has made not a bad recovery. If I was assessing damages, I would have assessed non-economic loss on the basis of 28 per cent, which, it does not matter what it totals, but on the basis of 28 per cent, I would have awarded past economic loss which is not in dispute, of $11,508, superannuation not in dispute of $1,036. Out of pocket expenses of $2,485, future economic loss of $35,000, that being a buffer and future out of pocket expenses of $7,000.

ISSUES 29 The appellant appeals on the following grounds: 1. His Honour erred in law by holding that the Respondent succeeded on the defence under s45(1) of the Civil Liability Act 2002 (NSW), in that His Honour ought to have found that avoidance by the Respondent of the risk of injury caused by the' hole in the ground did not involve failure by the Respondent to "carry out road work" within the definition of that expression in s45(3) of the Civil Liability Act, and the definition of "road work" under the Roads Act 1993 (NSW).

His Honour erred on the facts in holding that the Appellant had not proved that the Respondent had actual knowledge of the particular risk from the hole (the materialisation of which resulted in harm to the Appellant) in that: (a) His Honour considered only whether there was specific direct evidence of actual knowledge; (b) His Honour failed to consider whether the circumstantial evidence including His Honour's other holdings, justified the inference that the Respondent had actual knowledge of the particular risk from the hole; (c) in particular, His Honour failed to consider whether, and to hold that, a hole which was located where His Honour found it ought to have been seen by the Respondent's employees over a long period in a main street of the township of Condobolin where the Respondent operated its activities, was probably seen at least once by one or other of the Respondent's employees at some stage so as to create actual knowledge by the Respondent of the hole and therefore of the particular risk from the hole. (d) the correct conclusion from the totality of the evidence, together with the failure by the Respondent to adduce evidence on the question, was, in light of His Honour's other findings against the Respondent, and is, on appeal, that the Respondent had actual knowledge of the particular risk from the hole.

30 The respondent cross-appeals on the following grounds: 1. His Honour erred in denying procedural fairness to the Cross-Appellant in permitting evidence to be given by Kevin Read about the presence of two Council Officers at the scene of the Plaintiff's fall in 2000 or 2001. 2. His Honour was in error in denying procedural fairness to the Cross-Appellant in refusing an adjournment to the Cross-Appellant. 3. His Honour was in error in assessing damages for non-economic loss at 28% of the worse case.

31 I will consider in turn the following issues:

The applicability of s.45 of the Civil Liability Act.
The questions of procedural fairness raised in the cross-appeal.
The question of actual knowledge of the respondent.
Damages.

APPLICABILITY OF S.45 OF CIVIL LIABILITY ACT Submissions 32 Mr. Gross QC for the appellant submitted that the definition of "carry out road work" in s.45(3) was exhaustive, not inclusive, so that this case could fall within s.45 only if there could be identified "a road work" within the meaning of the Roads Act, as to which the Council failed to carry out some activity "in connection" with "its construction, erection, installation, maintenance, inspection, repair, removal or replacement".

33 Mr. Gross submitted that filling the hole would not be a road work, because the definition in the Roads Act made it clear that a road work was something constructed or installed, and that could not be said of soil or other material used just to fill a hole. Furthermore, the unmade section of the footpath, that is, the nature strip, in which the hole was situated was not a road work. Mr. Gross further submitted that it was not shown that the nature strip had been constructed or installed for the purpose of facilitating the use of the road as a road, or the regulation of traffic on the road, or the carriage of utility services across the road.

Decision 34 In my opinion, this case does come within s.45, on either of two bases.

35 First, where that part of a road used for pedestrian purposes has been altered by the installation of a footpath and a gutter, leaving what may be called a nature strip in between, it is in my opinion an unduly narrow view of what constitutes a road work to say that, while the made footpath is a road work and the gutter is a road work, the nature strip between them is neither a road work nor part of a road work. In my opinion the better view is that the whole of the area for pedestrian purposes, comprising the made footpath, the nature strip and the gutter, comprises a road work.

36 Second, in any event, where there is a hole in that part of a road which is a nature strip within the area used for pedestrian purposes, it would be road work to fill and make good that hole. That view is not in my opinion precluded by the use of the words "constructed" and "installed" in the definition of road work in the Roads Act, which, unlike the relevant definition in s.45 of the Civil Liability Act, is an inclusive definition and not an exhaustive definition. Once it is accepted that to fill and make good the hole would be road work, then the question would arise whether failure to do this would be failure to "carry out any activity in connection with the construction, erection, installation, maintenance, repair or replacement of a road work" within s.45(3). In my opinion, it would be: although the words "construction" and "installation", and the indefinite article "a" in front of "road work", could be taken as inapt for the filling and making good of a hole, on balance I think it would be too narrow an approach to hold that the words do not extend to such activity.

37 On either basis, s.45 applies: on the first basis, the allegation would be that the respondent failed to maintain a road work, and on the second basis, it would be that the respondent failed to construct or install a road work.

PROCEDURAL FAIRNESS 38 The cross-appeal only arises if the appeal would otherwise be allowed. However, in my opinion it is appropriate to consider the question of procedural fairness before moving on to the second ground of appeal, because in my opinion that second ground should be considered in the light of the circumstances in which the evidence on which the appellant primarily relies was led, and was not made subject to substantial challenge in cross-examination or evidence in reply from the respondent.

Submissions 39 Mr. Davies SC for the respondent submitted that the primary judge was in error in finding that the appellant's allegation in the Statement of Claim that the respondent had actual knowledge of the existence of the hole was sufficient to enable the respondent to investigate and answer this aspect of the appellant's claim, and in particular to enable it to deal with evidence sought to be led from Mr. Read of inspection by two Council officers in about late 2001. Mr. Davies submitted that this case was never particularised, and was in fact completely different from the case that was particularised. The primary judge should not have permitted the evidence to be given, or at the very least should have granted an adjournment to enable the respondent to investigate the allegations so as to be able to cross-examine Mr. Read and/or lead evidence in reply.

40 Mr. Gross submitted that the respondent had not asked for particulars of par.5 of the Statement of Claim, and also delayed the applicant's preparation of his case by not producing documents on subpoena until about two weeks before the hearing. The documents then produced showed that the respondent was involved in and aware of a project that included paving the relevant area of the footpath, and so must have been in a position to deal with the appellant's allegation that it had knowledge of the hole. The respondent could have ascertained, by cross-examination of Mr. Read, the names of the Council officers he was referring to, and could have obtained instructions from them and called them on the next day of the hearing. In all the circumstances, Mr. Gross submitted, it was within the discretion of the primary judge to allow the evidence, and not to grant the adjournment; and no error is shown that would justify appellate intervention.

Decision 41 In my opinion, in so far as the primary judge's decision was based on the notion that the appellant's allegation in the Statement of Claim that the respondent had knowledge of the existence of the hole was sufficient to enable the respondent to investigate the claim, that is an error. When a plaintiff alleges actual knowledge of something in a defendant, the defendant is entitled to particulars of any communication of that information that the plaintiff relies on, and if the actual knowledge is alleged by the plaintiff to be a matter of inference from certain circumstances, the defendant is entitled to particulars of the circumstances relied on. However, in order to decide if this error vitiated the primary judge's decision, or if the Court of Appeal should make some other decision, it is necessary to have regard to the following additional circumstances:

The respondent did not ask for particulars of circumstances relied on by the appellant to support an inference of knowledge.
The respondent did not answer a subpoena issued by the appellant, which was returnable about three months before the hearing, until about two weeks before the hearing.
The respondent did not plead s.45 until five days before the commencement of the hearing.
The case had been set down for trial for some time, the appellant's witnesses came from country areas, and the problem arose on the second day of hearing of a trial set down for three days.

42 In all those circumstances, I am not satisfied that the error I have identified vitiated the primary judge's exercise of discretion, or, in any event, that this Court should make some other decision.

43 However, in my opinion the circumstances in which Mr. Read's evidence concerning the two Council officers came to be given, and the refusal of the adjournment, are relevant to the next ground of appeal. The respondent's Counsel told the primary judge of efforts made to get instructions in order to enable cross-examination and, if appropriate, to answer this evidence, and the primary judge acted on that information. Neither the primary judge nor the appellant's Counsel suggested that it was necessary to give evidence about these efforts. In those circumstances, if the primary judge had not been prepared to accept what he was told by the respondent's Counsel about the efforts to deal with the evidence in question, without actual evidence of those efforts being led before him, procedural fairness would have required him to advise the respondent of this so that such evidence could have been led. On the basis of the statements made by the respondent's Counsel about efforts to get instructions on these matters, any failure by the respondent to cross-examine Mr. Read on this evidence or to call evidence in reply could not have supported either unqualified acceptance of the evidence in question, without regard to its quality, or the drawing of any Jones v. Dunkel inference adverse to the respondent.

44 In fact, the primary judge did not do either of these things; and the point of this discussion is to show that the primary judge was correct not to do so.

ACTUAL KNOWLEDGE OF THE RESPONDENT Submissions 45 Mr. Gross submitted that the accident happened near the intersection of William Street and Bathurst Street, Condobolin, these two streets being the two main streets of Condobolin and in the middle of town, and Condobolin being a small town with a population of about 3,000 or 4,000 people. Since the respondent had the responsibility of maintaining the road, gutter and footway in a satisfactory state of repair, it could be assumed that its employees did perform this role at a level of frequency that would entail inspections occurring during the period when the hole was clearly visible.

46 Mr. Gross submitted that, in determining whether the appellant had established actual knowledge, the primary judge too narrowly viewed the available evidence which would justify the inference that the respondent knew of the risk constituted by the hole.

47 Mr. Gross referred to evidence given by Mr. Read of inspections by two employees of the respondent prior to the accident, saying "we walked up and down the footpath" and did so "just right along William Street to the lane where the footpath was to be extended". This inspection was by Council employees, in circumstances where the Council was to perform paving as a joint project between the Condobolin Aboriginal Health Service and the respondent. The hole was there at that time. Mr. Gross also relied on plans dated February 2003 showing the proposed paving of the footpath in the vicinity of the hole, such plans being signed on behalf of the respondent.

48 Mr. Gross submitted that the respondent did not call evidence to justify a conclusion that, despite potential opportunity to see the hole, the area where the hole was had not been inspected or that on any such inspection, no hole had been seen. The respondent's failure to give evidence addressed to that question enabled adverse inferences to be drawn against it.

Decision 49 Mr. Gross's written submissions did not in terms rely on evidence from Mr. Read to the effect that, at the time of inspection by the Council workers, the hole was "clearly visible". A leading question to that effect was put to Mr. Read, but it was not then answered because of an objection taken by the respondent's Counsel. After that objection had been dealt with, according to the transcript, the only subsequent reference to this issue was a question "You have stated it was clearly visible. Do you recall that?", to which Mr. Read answered "Yes".

50 As the lack of reliance on this suggests, this could not be regarded as satisfactory evidence concerning the visibility of the hole at the time of inspection. If evidence as to the visibility of the hole at that time was to be relied on, it should have been evinced by non-leading questions as to Mr. Read's observations as to the visibility of the hole at the time, directed for example to its size, the state of the grass at the time, the lighting, and so on. The shortcomings in the way this matter was dealt with in Mr. Read's evidence cannot be overcome by the lack of cross-examination or evidence in reply, for reasons already given.

51 Accordingly, in my opinion there was no error in the primary judge's having said "We do not know what the state of the hole was at that stage. Was it covered with grass? Was it visible?".

52 It is clear that a finding of actual knowledge can be based on inference rather than direct evidence: Leichhardt Council v. Serratore [2005] NSWCA 406 at [12]-[15]. However, in my opinion, the primary judge did not err by taking too narrow a view of the evidence that might have established knowledge by way of inference. He did have regard to the obligations of the respondent, and indeed concluded that the respondent should have known about the hole. He had regard to the evidence of inspection by the Council officers. There was no explicit mention of the possibility of an inference that, because of the Council's involvement of the paving of the area, there must have been other inspections; but in my opinion this is a more tenuous matter than the actual inspection of which evidence was given.

53 In circumstances where the positive evidence relied on by the appellant cannot be considered as being assisted by the lack of cross-examination and lack of evidence in reply, for reasons I have given, I am not satisfied that the primary judge was in error either in the reasons he gave or in the conclusion he reached, that is, in deciding that it was not proved that the respondent had actual knowledge of the hole.

DAMAGES 54 Mr. Davies submitted that the judge's evaluation of non-economic loss at 28% of a most extreme case was manifestly excessive.

55 Had I been considering this case de novo, I am inclined to the view that I would have not have considered non-economic loss to have exceeded 20% of a most extreme case; but in circumstances where the respondent conceded below that the appropriate range was 23-25%, I do not think that an assessment by the primary judge of 28% could possibly be considered an error justifying appellate intervention.

CONCLUSION 56 For those reasons, in my opinion the following orders should be made:

Appeal dismissed.
Appellant to pay the respondent's costs of the appeal.

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.

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