Common Law Re Relation of Duty of Care and Public Law Duties Re Exercise of Statutory Power
320 From early in the history of the imposition on statutory authorities of duties of care concerning exercises of their statutory powers it has been recognised that statutory authorities are under duties in public law concerning the exercise of their powers, and an attempt has been made to work out the connection between these public duties and any duty of care to which the authority is also subject.
321 In Anns, when considering the duty of a council concerning an inspection it had made (not a failure to make an inspection), Lord Wilberforce at 755F-G concluded that to succeed a plaintiff must prove "that action taken was not within the limits of a discretion bona fide exercised, before he can begin to rely upon a common law duty of care. But if he can do this, he should, in principle, be able to sue."
322 Part of his Lordship's reason for making this distinction arose from his consideration, at 755A-B, of an argument that because the local authority has a power to inspect, not a duty, then it cannot be liable for negligent inspection because "if it were to be held so liable … councils would simply decide against inspection." His Lordship rejected that argument, saying that statutory authorities "must … make their discretionary decisions responsibly and for reasons which accord with the statutory purpose".
323 In support of that proposition his Lordship cites Ayr Harbour Trustees v Oswald (1883) 8 App Cas 623 at 639. There, Lord Watson said that the statutory authority there in question:
"… shall be vested with, and shall avail themselves of, these discretionary powers, whenever and as often as they may be of opinion that the public interest will be promoted by their exercise."
324 The context in which Lord Watson uttered those remarks was a compensation to land case. The Harbour Trustees had resumed some of the land owned by Mr Oswald, and a question arose about the amount of compensation to which he was entitled by reason of the severing of the resumed land from his remaining land. The harbour authorities offered that the conveyance to them from Mr Oswald should be "qualified by a declaration" that they not erect buildings on a particular part of the land that would interfere with Mr Oswald's access to the harbour. (The unusual form of restriction proposed to be included in the conveyance might be explained by the fact that the land in question was in Scotland.) Mr Oswald refused to agree to that proposal. For differing reasons (Lord Blackburn at 634, Lord Watson at 638) their Lordships decided the case on the basis of the situation that would apply if Mr Oswald had accepted that proposal. They held that the Harbour Trustees could not bind their successors as to the manner in which their successors would exercise their undoubted statutory powers to build whatever they liked wherever they liked on the land. It was as a reason for reaching that conclusion that Lord Watson made the statement that Lord Wilberforce quoted in Anns. That context is vastly removed from a context of deciding whether, and if so in what circumstances, a public authority can owe a duty of care in negligence concerning failure to exercise a power it has, or by reference to what standards one is to judge a breach of such a duty, if it exists.
325 Lord Wilberforce, immediately after the quotation from Ayr Harbour Trustees v Oswald, went on at 755C-D to say:
"If they do not exercise their discretion in this way they can be challenged in the courts. Thus, to say that councils are under no duty to inspect, is not a sufficient statement of the position. They are under a duty to give proper consideration to the question whether they should inspect or not. Their immunity from attack, in the event of failure to inspect, in other words, though great is not absolute. And because it is not absolute, the necessary premise for the proposition 'if no duty to inspect, then no duty to take care in inspection' vanishes."
326 In my respectful view, this reasoning is unpersuasive. Propositions that a statutory authority cannot by contract fetter the future exercise of a discretion that has been conferred on it by statute, and that it has a duty in public law to consider whether to exercise a statutory discretion, are in a different realm of discourse to whether a duty of care is owed in tort. The powers that are conferred upon a statutory body set the limits of how it is capable of validly acting. If it acts outside those powers, or purports to fetter them in advance, its action will be invalid. However, that a statutory body cannot validly fetter its powers in advance, and must as a matter of public law consider whether to exercise them, says nothing about how it ought act in relation to those powers, bearing in mind the reasonably foreseeable harm that might arise to particular persons, or groups of persons, from a failure to exercise those powers. If a statutory body fails to give proper consideration to the question of whether it should exercise a discretionary power, it would be open to a person with standing to seek an order in the nature of mandamus, requiring the statutory authority to turn its mind to the question of whether it should exercise its power. That the statutory body could be subjected to an order of mandamus says nothing about whether it owes, or has breached, a duty of care.
327 If one could find in the statute a parliamentary intention that a power should be exercised without regard to any duty of care that might arise under the general law, that intention would of course provide a reason why there was no duty of care - but in the present case there is no basis for finding such an intention. There is nothing unusual about a statutory authority being under duties that spring from two different sources, one in public law and the other in private law.
328 The balance of Lord Wilberforce's judgment says nothing about the circumstances in which there could be negligence by reason of failure to exercise a statutory power, beyond the conclusion, at 760F-G:
"… that the defendant council would not be guilty of a breach of duty in not carrying out inspection of the foundations of the block unless it were shown (a) not properly to have exercised its discretion as to the making of inspections, and (b) to have failed to exercise reasonable care in its acts or omissions to secure that the byelaws applicable to the foundations of the block were complied with""
329 In Anns, Lord Salmon differed from Lord Wilberforce. Lord Salmon recognised that a council could be subject to mandamus or certiorari if it decided to make no building inspections at all, but said, at 762E:
"I doubt however whether this would confer a right on any individual to sue the council for damages in respect of its failure to have carried out an inspection."
330 He was of the view, at 762G-H, that:
"If there was no inspection of the foundations before they were covered up, the tenants' claims would fail because the statute imposed no obligation upon the council to inspect the foundations of these maisonettes nor of any other particular building."
331 In Heyman at 445, Gibbs CJ, in the course of considering Anns, said:
"… public authorities … are liable for damage caused by a negligent failure to act when they are under a duty to act, or for a negligent failure to consider whether to exercise a power conferred on them with the intention that it should be exercised if and when the public interest requires it."
332 While this statement recognises one circumstance in which there can be negligence concerning failure to exercise a statutory power, it does not purport to be exhaustive.
333 Mason J in Heyman at 457-8 rejected Lord Wilberforce's account of the relationship between statutory powers and duties of care, saying:
"Except in so far as a statute creates a civil cause of action for breach of duty, the distinction between a statutory power and a statutory duty, generally speaking, has limited relevance to civil liability arising out of performance or non-performance of statutory functions. When a statute sets up a public authority, the statute prescribes its functions so as to arm it with appropriate powers for the attainment of certain objects in the public interest. The authority is thereby given a capacity which it would otherwise lack, rather than a legal immunity in relation to what it does, though a grant of power may have this effect when the infliction of damage on others is the inevitable result of its exercise. In framing such a statute it is inconvenient to describe the intended activities of the authority in terms of a series of positive duties. It is preferable to express those activities as functions or powers so that the authority is free to make policy-making decisions and discretionary judgments with a view to attaining the statutory objects. Decisions and judgments of this kind will be involved as a preliminary to exercising, or declining to exercise, a power and, subsequently, in determining how it is to be exercised. Viewed in this light statutory powers are not in general mere powers which the authority has an option to exercise or not according to its unfettered choice. They are powers conferred for the purpose of attaining the statutory objects, sometimes generating a public expectation having regard to the purpose for which they are granted that they will be exercised. There is, accordingly, no reason why a public authority should not be subject to a common law duty of care in appropriate circumstances in relation to performing, or failing to perform, its functions, except in so far as its policy-making and, perhaps, its discretionary decisions are concerned. And, despite possible indications to the contrary in Anns v Merton London Borough Council at 755, 757-758, 760, there is no compelling reason for confining such a duty of care to situations in which a public authority or its officers are acting in excess of power or authority."
334 Insofar as that passage contains the phrase "sometimes generating a public expectation having regard to the purpose for which they are granted that they will be exercised" it is not in accordance with later authority rejecting the notion of general reliance (Pyrenees), but the balance of the passage has not been overruled.
335 In Stovin v Wise, Lord Hoffmann, at 950, rejected a suggestion that the fact that a public body had a duty in public law to consider whether it should exercise its powers led to a conclusion that it owes a duty of care.
336 He saw the fact that a statutory authority had a statutory duty only by virtue of legislation conferring that duty as closely related to whether a duty of care existed concerning the exercise of that statutory duty.
337 He noted that a cause of action for breach of statutory duty existed only when the construction of the statute led to the conclusion that such an action was intended. An action for breach of statutory duty is, of course, dependent on legislative intention, while an action in negligence arises under the general law. However he said that any duty of care owed by a public authority in performing statutory duties "must be profoundly influenced by the statutory framework within which the acts complained of were done" (quoting from the speech of Lord Browne-Wilkinson in X-(Minors) v Bedfordshire County Council [1995] 2 AC 633 at 739C). He said, at 952H-B:
"If such a duty does not give rise to a private right to sue for breach, it would be unusual if it nevertheless gave rise to a duty of care at common law which made the public authority liable to pay compensation for foreseeable loss caused by the duty not being performed. It will often be foreseeable that loss will result if, for example, a benefit or service is not provided. If the policy of the Act is not to create a statutory liability to pay compensation, the same policy should ordinarily exclude the existence of a common law duty of care."
338 His Lordship clearly regarded the situation concerning a duty of care in a situation where there had been an omission to perform a mere statutory power as a fortiori. He recognised, at 953B-D, that, even though Parliament legislated to create a statutory power rather than a statutory duty,
"It may nevertheless have contemplated that in circumstances in which it would be irrational not to exercise the power, a person who suffered loss because it had not been exercised, or not properly exercised, would be entitled to compensation. I therefore do not say that a statutory 'may' can never give rise to a common law duty of care … [b]ut the fact that Parliament has conferred a discretion must be some indication that the policy of the Act conferring the power was not to create a right to compensation. The need to have regard to the policy of the statute therefore means that exceptions will be rare."
339 At 953D-E, he identified "the minimum preconditions for basing a duty of care upon the existence of a statutory power" as being:
"… first, that it would in the circumstances have been irrational not to have exercised the power, so that there was in effect a public law duty to act, and secondly, that there are exceptional grounds for holding that the policy of the statute requires compensation to be paid to persons who suffer loss because the power was not exercised."
340 In application of that test to the facts of the case before him, Lord Hoffmann, at 956-7, held that it was not established that it was irrational for the highway authority to not have moved faster in eliminating the danger at the intersection in question. As well, he held that, even if there had been irrationality in the council having failed to get the bank removed, there were no exceptional grounds that justified a duty of care. The obstruction was obvious, and there was no question of reliance on the council having improved the intersection. The statutory power to require an owner of land adjoining a highway to remove an object that obstructs the view of users of the highway was enacted at a time when there was no liability on a highway authority for breach of its statutory duty to maintain the highway, and hence it was "impossible to discern a legislative intent that there should be a duty of care in respect of the use of that power" (at 958A).
341 That view of things makes the existence of a duty of care for failure to exercise a statutory power dependent on matters of public law - on the inaction complained of being outside the scope of the power, and also on a finding that, as a matter of construction of the statute, a private law remedy is intended. One can readily agree that if there is a statutory intention that there be no private right of action that statutory intention must prevail, but it is quite another thing to say that there can be no private right of action unless one can find a positive intention in the legislation that there be a private right of action. Setting out on that course invites all the difficulties that there are in the tort of statutory duty about how one ascertains the "statutory intention" that is said to be the basis of the tort, and adoption of the creative fiction that is often involved in that exercise: see Campbell, "Contribution, Contributory Negligence and Section 52 of the Trade Practices Act" (1993) 67 ALJ 87 at 95-108, & esp fn 109 at 108. It also removes this particular manifestation of the tort of negligence from the usual roots of the tort of negligence in judicial decisions identifying the circumstances in which the law will impose an obligation to take reasonable care, and the connection between "reasonable care" and the standards of behaviour of the community.
342 When the existence of duties of care owed by public bodies is well established, there is no reason to construe legislation as having proceeded on the basis that a particular public body will be subject to a duty of care concerning exercise of a power only if a positive intention can be found that it be so subject. One does not proceed on the basis that public officials are entitled to commit crimes in the course of exercising their statutory discretions unless there the legislation indicates otherwise, and it is hard to see why entitlement to act without reasonable care should be any different.
343 As well, it seems to me that applying public law standards of when a decision is unreasonable to a question of whether there has been a failure to act with reasonable care involves conflating two different senses of "reasonable".
344 Actions, or failures to act, cannot be assessed as "reasonable" or "unreasonable" in the abstract - they are reasonable or unreasonable by reference to some particular thing: Certain Lloyds Underwriters v Giannopoulos [2009] NSWCA 56 at [115]. In the law of negligence the question of whether there has been a failure to take reasonable care is answered by reference to the law's requirement that a person in a particular type of relationship to other people take reasonable care to avoid harm to those other people (ie the nature of duty of care owed), and the question of whether reasonable care has been taken is judged by reference to what a reasonable person would have done for the purpose of avoiding harm to the person to whom the duty is owed: cf Lloyds v Gianoppoulos at [105]-[106]. By contrast, a question about whether a statutory authority has acted in a way that is not a reasonable exercise of or failure to exercise its statutory power must be answered by a reference to the proper scope of that particular statutory power. That will depend upon the construction of the statutory instrument that confers the power, and the purpose for which the particular power was conferred. While there might be particular powers concerning which the potential for an exercise of the power to cause harm to some predictable person or group of people will be relevant to deciding the scope of the power, in very many cases matters other than the potential of a particular action or inaction to cause harm will enter into deciding whether that action or inaction is one that a reasonable statutory authority would not have engaged in.
345 It seems strange that a question of negligence - whether reasonable care has been taken to avoid causing harm to particular people - could be dependent on matters that have nothing to do with whether reasonable care has been taken. Of course, what is involved in taking reasonable care in any particular situation can be influenced by other responsibilities that a defendant has, but the focus of the enquiry is on whether reasonable care has, or has not, been taken in all the circumstances. The focus of the inquiry in deciding a question of Wednesbury unreasonableness is wider, and different.
346 As well, in the administrative law context, the Wednesbury test of invalidity presupposes that there was a range of decisions that a reasonable authority could have made in exercising validly its power to act or not act concerning some subject matter, and it is only if the action of the authority is outside that range of possible reasonable decisions that it is beyond power, and hence invalid. The question of whether there has been a breach of duty of care in the law of negligence operates differently to this. The test for appellate intervention in decisions about breach of a duty of care, when the primary facts are established, has been laid down in Warren v Coombes (1979) 142 CLR 531, and it concerns "whether the learned trial judge was correct in finding that the respondent was not negligent" (at 536), or "the proper inference to be drawn from facts…" (551). Such tests can only be answered by a response that "the trial judge was correct" or "the trial judge was not correct", or "the proper inference to be drawn is that the defendant failed to take reasonable care", or "the proper inference to be drawn is that the defendant took reasonable care". Similarly, a trial judge deciding a question of breach of duty of care is trying to find the (single) right answer to the question of whether there has been a breach of a duty of care, not to choose which answer is preferable out of several that are legitimately open. The question of whether there has been a breach of duty of care is, of its nature, one concerning which a court cannot recognize that there is a range of legitimately open answers to the question of whether the defendant failed to take reasonable care.
347 There are some indications in later High Court authority that the Stovin v Wise approach to the relationship between public duties and duties of care concerning failure to exercise statutory powers is not accepted by at least some judges. In Graham Barclay Oysters, Gleeson CJ said, at 562 [32]:
"It is necessary to distinguish between a public duty, enforceable by mandamus, to give consideration to the exercise of a power, and a legal duty, owed to a citizen, to exercise the power."
348 And at 563 [35]:
"… the circumstance that, in the public interest, certain powers of regulation of activity within its area are vested by statute in the Council does not mean that the Council owes a legal duty to individuals or classes of person whose health may be affected, directly or indirectly, by decisions made as to the exercise of those powers."
349 At 575 [80], McHugh J recognised that a statutory authority can sometimes be liable for negligence for failing to exercise a statutory power. He continued:
"But it invites error to think that the common law has converted the discretionary statutory power into an affirmative duty to exercise the power. The common law cannot interfere with the exercise of the discretion and require the authority to enforce the power. To attempt to do so would bring the common law into conflict with the legislative intention that the exercise of the power be discretionary. The common law avoids the conflict by holding that in the circumstances the failure to exercise the power is a breach of a common law duty existing independently of the statute. The common law duty may or may not be an affirmative duty to take reasonable care to protect the plaintiff from harm. However, the existence of the statutory power does not create the common law duty although in some cases - particularly in reliance cases - it may be an important factor in finding that a duty of care was owed."
350 In the absence of authority binding me to do otherwise, I would take the view that principled development of the common law is not in accordance with the Stovin v Wise approach to this topic.