6.1 Coherence of the Posited Duty with the Statutory Scheme and Administrative Law
316 The Minister contended that the posited duty of care is incoherent with the EPBC Act and more generally with public law principles. The applicants denied that the posited duty was inconsistent with the EPBC Act or incoherent with public law.
317 The High Court has referred to "coherence in the law" or applied coherence-based reasoning in a wide range of contexts. There are helpful discussions of the concept of coherence and the cases in which it has been considered in the academic literature including Grantham R and Jensen D, 'Coherence in the Age of Statutes' (2016) 42 Monash University Law Review 360 and Fell A, 'The Concept of Coherence in Australian Private Law' (2018) 41(3) Melbourne University Law Review 1160. Whilst there is much background assistance to be gained from the wider discussion, it is sufficient to confine my consideration of 'coherence' to those authorities in which coherence-based reasoning has been applied in relation to whether a duty of care should be recognised.
318 Of the relevant High Court authorities to which I was referred, the most comprehensive discussion of 'coherence' is found in Sullivan v Moody. That reasoning has been variously endorsed or followed without apparent disagreement in each of the more recent judgments of the High Court dealing with the topic: Graham Barclay Oysters at [147] and [149] (Gummow and Hayne JJ); Tame at [24] and [28] (Gleeson CJ), at [57] and [58] (Gaudron J), at [123] (McHugh J), at [231] (Gummow and Kirby JJ), at [298] (Hayne J) and at [323] and [335]-[336] (Callinan J); McKenna at [29]-[33] (French CJ, Hayne, Bell, Gageler and Keane JJ); and Stuart at [113] (Gummow, Hayne and Heydon JJ).
319 Two further High Court authorities are of relevance, Miller v Miller (2011) 242 CLR 446 and CAL No 14 Pty Ltd v Motor Accidents Insurance Board (2009) 239 CLR 390.
320 Before turning to consider the authorities and, in particular Sullivan v Moody, it is useful to make some general observations about 'coherence' which I draw from the relevant authorities.
321 To arrive at a proper understanding of 'coherence', it must first be recognised that 'coherence' is a creature of the common law. It is not a law or a principle created by or attributable to Parliament. Coherence-based reasoning is a "policy consideration" applied by the common law: Miller v Miller at [15] (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ); Equuscorp Pty Ltd v Haxton (2012) 246 CLR 498 at [23] and [34] (French CJ, Crennan and Kiefel JJ). It is a policy consideration which is deployed by the common law to assist in the development and application of the common law, primarily in respect of its interaction with statute law, but also internally as between different principles of the common law.
322 In relation to its interaction with statutory law, coherence-based reasoning has a broader conception than that which the applicants' submissions would allow. It is not merely about a court construing from a statute Parliament's intent to exclude the common law from the statute's field of operation. It is primarily about the common law determining that there are policy reasons as to why it is not appropriate for the common law to enter a particular field or parts thereof. Where Parliament is already in the field, coherence-based reasoning is driven by a need to avoid joint occupation of the field that would undermine, contradict or substantially interfere with the purpose, policy and operation of the statutory law already in place. It is not necessary for the common law to adhere to the existing statutory law as though they are glued together as a seamless whole. What is required by coherence-based reasoning is that the two laws cohere, one sitting compatibly alongside the other without "incongruity" or "contrariety": Miller v Miller at [74]. In Sullivan v Moody, an absence of coherence was expressed in terms of a lack of consistency (see for example at [62] (Gleeson CJ, Gaudron, McHugh, Hayne and Callinan JJ)).
323 The principal concern underlying the requirement for consistency is, as the Court in Sullivan v Moody said at [55], a "question about coherence of the law". The fundamental problem presented by cases of this kind is, as the Court said at [50], "the need to preserve the coherence of other legal principles, or of a statutory scheme which governs certain conduct or relationships". Drawing on those observations, McHugh J in Tame at [123] said that "the need for the law to be coherent is a relevant factor in determining whether a duty exists".
324 In Sullivan v Moody, the plaintiffs alleged that the State of South Australia incompetently conducted investigations into allegations that they had sexually abused their respective children. The plaintiffs alleged that as a result of the negligent investigations they had suffered harm including psychiatric injury and personal and financial loss. The statutory scheme applicable to the investigation provided that the interests of the children were paramount.
325 The Court held that the duty for which the plaintiffs contended could not be reconciled with the statutory functions being exercised given the objective of the statute that those functions be exercised in the interests of the children. It was inconsistent with those functions and that objective to impose a legal duty to protect people suspected of inflicting the harm in the course of investigating allegations of serious harm to children, and such a duty would conflict with the duty owed to the children (at [62]).
326 What gave rise to the relevant inconsistency on the facts of that case was described by the Court at [62] as follows (emphasis in original):
The statutory scheme that formed the background to the activities of the present respondents was, relevantly, a scheme for the protection of children. It required the respondents to treat the interests of the children as paramount. Their professional or statutory responsibilities involved investigating and reporting upon, allegations that the children had suffered, and were under threat of, serious harm. It would be inconsistent with the proper and effective discharge of those responsibilities that they should be subjected to a legal duty, breach of which would sound in damages, to take care to protect persons who were suspected of being the sources of that harm. The duty for which the appellants contend cannot be reconciled satisfactorily, either with the nature of the functions being exercised by the respondents, or with their statutory obligation to treat the interests of the children as paramount. As to the former, the functions of examination, and reporting, require, for their effective discharge, an investigation into the facts without apprehension as to possible adverse consequences for people in the position of the appellants or legal liability to such persons. As to the latter, the interests of the children, and those suspected of causing their harm, are diverse, and irreconcilable. That they are irreconcilable is evident when regard is had to the case in which examination of a child alleged to be a victim of abuse does not allow the examiner to form a definite opinion about whether the child has been abused, only a suspicion that it may have happened. The interests of the child, in such a case, would favour reporting that the suspicion of abuse has not been dispelled; the interests of a person suspected of the abuse would be to the opposite effect.
327 The statutory scheme there considered required the repository of statutory power to treat the interests of the children as paramount, whereas the duty posited by the plaintiffs would have required that the interests of those suspected of causing the children harm be themselves protected from harm. That conflict, the Court reasoned, made the asserted duty of care inconsistent with the proper and effective discharge of the statutory and professional responsibilities of the repository of the statutory power. It was in that context that the source of the inconsistency was said to be founded in the "nature of the functions being exercised" and in the "statutory obligation to treat the interests of the children as paramount".
328 The extent of the inconsistency was regarded as significant and expressed in terms of an inability to reconcile features of the statutory scheme with features of the posited duty. The nature of an inconsistency with statutory duties necessary to deny the existence of a duty of care had been earlier discussed by the Court at [53]-[60]. The Court stated that a duty of care would not exist where to find such a duty "would so cut across other legal principles as to impair their proper application" (at [53]). A duty of care should not be found if that duty was incompatible with other duties which the respondent owed (at [55]). At [60] in the passage set out below at [362], the Court opined that the fact that a repository of a statutory duty was constrained by the manner in which powers and discretions may be exercised does not of itself rule out the possibility that a duty of care is also owed, at least where those duties were not "irreconcilable". Dealing then with public authorities charged with exercising responsibilities and powers in the public interest or in the interest of a specified class of persons, the Court observed that "the law" would not ordinarily subject such an authority to a duty to have regard to "conflicting" interests, claims or obligations.
329 I will deal separately with the Minister's contention that the posited duty is incoherent with public law. The Minister primarily asserted incoherence with the EPBC Act because the imposition of the posited duty would be inconsistent with the statutory task required of the Minister by s 130 and s 133 of that Act. At its highest, the impairment of the statutory task and the decisional freedom given to the Minister was said to be that the statutory discretion would be effectively foreclosed because the imposition of a duty of care would dictate a particular outcome, namely, the refusal of the Extension Project. It is convenient that I describe that as an assertion of the foreclosure of the discretion. However, the Minister also contended that the process of decision-making would be impaired because the posited duty would require that the avoidance of harm to the Children be effectively elevated to a mandatory and paramount consideration and would thus "distort" or "skew" the Minister's discretion. It is convenient that I describe that as an assertion of a process-based impairment of the discretion. I appreciate that the Minister did contend that the "distortion" of her discretion extended to its effective foreclosure but, for convenience, I will place that impairment in the first category identified above.
330 The applicants drew attention to s 75(iii) of the Constitution and contended that, by that provision, the Executive is liable in tort including in the exercise of functions conferred by the legislature, unless the legislature has excluded liability. For those propositions, the applicants relied on observations made in Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at [125] where Gageler J restated the law as held by Gummow and Kirby JJ in The Commonwealth v Mewett (1997) 191 CLR 471 at 549-50 as follows (citations omitted):
The inclusion of s 75(iii) in the Constitution involved a rejection of any notion, which might otherwise have been drawn from the common law principle then still prevailing in England that the monarch could "do no wrong", that the Executive Government of the Commonwealth was to enjoy immunity from suit for its own actions or for the actions of its officers or agents. The inclusion of s 75(iii) had the consequence of exposing the Commonwealth from its inception to common law liability, in contract and in tort, for its own actions and for actions of officers and agents of the Executive Government acting within the scope of their de facto authority. Any exclusion of actions of the Executive Government from common law liability was to result not from the existence of a generalised immunity from jurisdiction but through the operation of such substantive law as might be enacted by the Parliament under s 51(xxxix) or under another applicable head of Commonwealth legislative power.
331 At [126], Gageler J went on to consider the purpose of s 75(v) of the Constitution which provides that the High Court of Australia has jurisdiction in all matters in which an injunction is sought against an officer of the Commonwealth. Relevantly, Gageler J said this (citations omitted):
Its effect was also to ensure that an officer of the Commonwealth could be restrained by injunction from acting inconsistently with any applicable legal constraint even when acting within the scope of the authority conferred on that officer by the Constitution or by legislation.
332 That observation entails a recognition that a repository of statutory power may validly exercise the power but nevertheless do so negligently. That proposition is of some importance to the applicants' contention and is supported by other authorities to which I will later refer.
333 The applicants submitted that to recognise a duty of care in the exercise of a statutory power, a court must first conduct a "consistency" analysis. That analysis, the applicants contended, asks whether the legislature has conferred some power on the Executive which, of its essence, would be so altered or impaired by the recognition of a common law duty to certain classes of persons that it may be said that the legislature has, by implication, intended to exclude liability. Thus the applicants say that the judiciary will recognise a duty only having concluded that the legislature has not expressly or impliedly excluded it and that the judiciary's recognition that the statute excludes liability in negligence has variously been labelled "inconsistency" and "incoherence".
334 The applicants deny that for a duty of care to "distort" or "skew" the exercise of a statutory power entails incoherence because, if it did, it would mean that there could never be a duty imposed on a statutory authority which is vested with a discretion to do a positive act. They rely on a long line of authority in support of the proposition that liability in negligence may be imposed on a statutory authority exercising a statutory power or discretion. They contended that there was no inconsistency between the posited duty and the duty under s 130 and s 133 of the EPBC Act because the posited duty:
(i) is not inconsistent with the Minister's statutory duty to make a decision;
(ii) does not require the Minister to have regard to issues which she is precluded from considering under the EPBC Act; and
(iii) does not dictate how the Minister must exercise her discretion.
335 The authorities do not, in my view, support the restrictive approach to 'coherence' for which the applicants contend. Whilst 'coherence' in this context is very much focused upon consistency between the statute and the asserted duty, the identification of inconsistency is not limited to a consideration of the exclusionary intent of the statute or to a direct conflict of obligations and extends to an impairment in the performance or exercise of a statutory power or discretion. Sullivan v Moody, as well as other authorities relied upon by the Minister to which I will shortly turn, supports the proposition that what I have called a process-based impairment can provide a basis for a finding of incoherence.
336 On the other hand, the Minister was unable to identify any occasion where the apparent foreclosure of a statutory discretion caused by the imposition of liability in negligence has ever been regarded as raising incoherence or inconsistency. The applicants rely on numerous authorities where liability in negligence was imposed in relation to the negligent exercise or non-exercise of a statutory power or discretion in the absence of any observation of incoherence. Those authorities suggest that the decisional freedom given to the holder of a statutory discretion to exercise the discretion validly in a particular way is not necessarily to be regarded as impaired by the imposition of liability for negligence, at least where liability is confined to an award of damages.
337 Each of the contentions made by the Minister relied upon what the Minister asserted was the broad discretionary power conferred upon her to approve or not approve a controlled action. I agree with that characterisation of the power and the Minister's associated submission that the statutory scheme contemplates a broad enquiry by the Minister and the weighing of competing considerations.
338 The discretion given to the Minister to approve or not approve a controlled action is unconfined by any statutory criteria which specifies the state of satisfaction required for approval or disapproval. There are negative stipulations made by ss 137-140A which, broadly speaking, require that the Minister not act inconsistently with a specified international treaty or international convention and not approve the construction of a nuclear installation, but the Minister's discretion is otherwise only circumscribed by the considerations she is permitted to take into account, including some that are mandatory, and the objects of the EPBC Act. The considerations the Minister must take into account include those specified in s 136(1). The factors which are required to be taken into account when the Minister considers those matters are specified by s 136(2). While s 136(5) restricts the matters that the Minister may consider to those matters required by Div 1 of Pt 9, those matters include any matter relevant to any matter protected by a provision of Pt 3 (s 136(1)(a)) and economic and social matters (s 136(1)(b)). Those categories encompass a wide range of possible considerations none of which are mandatory and all of which are available to be considered and weighed in the evaluative exercise the Minister must undertake in approving or not approving a controlled action.
339 The Minister contended, and I accept, that it is likely that in such an exercise the Minister will be called upon to weigh competing considerations. As the Minister stated, the balancing process between potentially competing interests the EPBC Act is looking to promote can be seen in part from s 3A(a), which forms part of the "principles of ecologically sustainable development" there described. Section 136(2)(a) provides that the Minister must take those principles into account and, as mentioned earlier, the promotion of "ecologically sustainable development" is an object of the EPBC Act listed in s 3(1)(b). The EPBC Act's promotion of decision-making processes that "effectively integrate both long-term and short-term economic, environmental, social and equitable considerations" (s 3A(a)) highlights an intent that competing considerations be assessed and that a balance be struck between them.
340 The Minister submitted that the scheme of the EPBC Act provides her with a broad discretion and contemplates that the statutory exercise required to approve, or not approve, a particular controlled action involves the striking of a balance between competing considerations. She contended that there was inconsistency between the statutory scheme and the posited duty because the duty would, in practicable terms, impose a mandatory obligation upon the Minister to consider the potential for the controlled action to cause harm to the Children, when that consideration is not a mandatory consideration under the EPBC Act. That was said to be a species of distortion and thus incoherence.
341 The principal authority relied upon by the Minister in support of her submission asserting incoherence is the judgment of Allsop P (as his Honour then was) in MM Constructions (Aust) Pty Ltd v Port Stephens Council (No 7) [2012] NSWCA 417. In that case, Allsop P (with whom Bergin in Eq agreed) determined that the duty of care there asserted was not established, including because it was inconsistent with the balancing exercising required of the Council by the EPA Act in determining whether to approve or modify a development proposal. The appellants were developers who had submitted development plans to the Council for approval. They claimed that the Council had been negligent in handling their development application and subsequent modification application. Their claim in negligence was founded on an asserted duty upon the Council to act with reasonable care in its handling of their applications for approval so as to avoid foreseeable economic loss to them.
342 To make good her reliance upon MM Constructions, the Minister contended that the scheme of the EPA Act was relevantly analogous to the scheme of the EPBC Act. It is convenient to consider that issue now.
343 The objects of the EPA Act (s 5) and the relevant provisions setting out the matters for consideration in the determination of a development application (s 79C) are set out in the judgment of Allsop P at [82] to [83]. At [98], his Honour noted that in making its judgment about whether to approve or not approve, the Council "must consider the broad range of interests public and private of the kind set out in the EPA Act, ss 5 and 79C".
344 The Minister sought to say that the balancing exercise required of the Council under the EPA Act was relevantly equivalent to that required by the Minister under the EPBC Act. I largely accept that contention but not entirely. In MM Constructions, Allsop P stated that the EPA Act "lays down the balance of interests to be assessed by the Council" (at [98]). I do not accept that quite the same characterisation may be made of the EPBC Act because the extent to which mandatory considerations were specified by the EPA Act differs greatly from those specified by the EPBC Act. Under the EPBC Act, and for reasons mentioned already, the limited categories of considerations which the Minister must consider include a broad range of considerations which are discretionary rather than mandatory. Nevertheless, whilst the Minister has greater freedom to choose which considerations deserve to be taken into account than did the Council under the NSW Act, the exercise required in each case involves, first, an assessment of the benefits and detriments of a particular proposal and, second, for the designated decision-maker to strike a balance as between any competing considerations and competing interests.
345 In MM Constructions at [89], Allsop P (with whom Bergin CJ in Eq agreed at [229]) referred to the Speirs line of authority, and at [100], citing his Honour's prior statements in Precision Products (NSW) Pty Ltd v Hawkesbury City Council (2008) 74 NSWLR 102, emphasised the continued force of Speirs and like cases. However, at [90] his Honour also sought to emphasise that neither Speirs nor Heyman "is the foundation for the broad proposition that any foreseeable loss of any kind from the exercise of any power, whatever its character, if exercised without reasonable care, is recoverable". His Honour stated that a "duty of some character must be gleaned as a matter of statutory construction or from the common law, in the context of the statute". His Honour continued at [91] by pointing out that a number of considerations needed to be borne in mind about the imposition of a duty in that case. First, consideration should be given to the fact that the damage sought to be recovered was for pure economic loss. Second, consideration should be given "as to the conformance of the statutory responsibilities of the Council with the content of the putatively imposed duty of care and the prospective interests of the [appellants] to be protected as well as to the realm of public administrative law".
346 His Honour considered a number of salient features and determined that there was relevantly no reliance, no assumption of responsibility and no vulnerability upon which the appellants could rely to establish the posited duty of care (at [93]-[96]). His Honour then considered whether imposition of a duty of care was in conformance with the statutory scheme. His Honour said at [98] (citations omitted):
Approval of a variation to a consent may be to the financial benefit of the applicant; a refusal would not be. Approval, however, may be to the financial detriment of a nearby landholder, and refusal to its benefit. In making a judgment about whether to approve or not, the Council must consider the broad range of interests public and private of the kind set out in the EPA Act, ss 5 and 79C. The power is exercised in that milieu of interests, including the environment, the public interest and the interests of other landholders. Thus, though the place of the applicant is not as starkly antithetical to the exercise of the power as was the party in Precision Products discussed at [12] of that judgment, it can nevertheless be said that the breadth of the interests and considerations attending the decision to approve an application, or not, conflict or may conflict with the duty to take into account the interests of the applicant. The legislation lays down the balance of interests to be assessed by the Council. They are to be weighed in the exercise of public power. The balance is adjusted in that way. Giving a private right of action through an imposed duty of care based on an applicant's economic interest may tend to skew that balance. Further, if the applicant's economic interests were to be protected, why not anyone whose economic interests may be affected? The statutory balance, intended to be reached by the bona fide decisions of Council, may be affected by the consideration of private litigation by those who wish to threaten it. These considerations affect the assessment of a lack of vulnerability. They also point to a degree of lack of conformance, indeed potential conflict, between the public duty of the Council in making the relevant decision, and considering the application therefor, and a private duty to act with reasonable care to avoid causing economic loss to the applicant: cf Sullivan v Moody (2001) 207 CLR 562 at [55]-[60].
347 A number of observations may be made of that passage. His Honour did not use the term "distort" or "distortion" but the synonymous expression "skew". The nature of the inconsistency accepted by Allsop P was found in the performance of the statutory task or, in other words, not in the existence of the statutory discretion but in the process of its exercise. It was the performance of the statutory task which was or may be skewed or distorted by the imposition of a duty. That was found to be sufficient to demonstrate incoherence or inconsistency. That an impairment upon the performance of the statutory duty may be sufficient to found an inconsistency is also apparent from the judgment in Precision Products, referred to by Allsop P in the passage set out above.
348 In Precision Products, the Council issued clean-up notices to the appellant following a site inspection of its premises by council officers. The notices required the appellant to cease use of, remove and dispose of hazardous substances. The appellant claimed damages for economic loss as a consequence of the alleged negligent exercise of statutory power by the Council which was said to have caused damage to the appellant's business by requiring it to cease the use of, and to remove stock from, the premises on which it conducted its business.
349 At [112] of Precision Products, Allsop P (with whom Beazley and McColl JJA agreed) said (emphasis added and citations omitted):
To cast on the EPA, or an authority such as the Council, the responsibility of taking into account the interests of the person who is, or may be, responsible for the pollution and requiring the authority to exercise care (enforceable by damages at common law) in going no further than is reasonable or necessary or proportionate to protect the environment is to infuse into the statutory process considerations that may have a tendency to discourage the due performance of the principal statutory duty. It might well lead to a defensive or overly cautious approach, or a hesitancy in ensuring that all steps are taken to protect the environment.
350 That inconsistency or incoherence may arise because of an impairment upon the process of performance of a statutory duty is also apparent from X v State of South Australia (No 3)(2007) 97 SASR 180 and in particular the judgment of Debelle J. In X v South Australia, the appellant was sexually abused by a convicted paedophile after that person had been released by the Parole Board and whilst the Parole Board exercised supervisory functions in respect of that person's release under licence into the community. The appellant claimed that the Parole Board owed a duty of care to prevent harm to children with whom the convicted paedophile might come into contact.
351 In considering whether the Parole Board owed a duty of care, Debelle J said this at [178] (emphasis added):
A number of factors may be relevant to the resolution of the question whether there is consistency between a common law duty of care and the scope and purpose of the statute. They include:
• The fact that a common law duty of care may cause decisions to be made in a "detrimentally defensive frame of mind": Hill v Chief Constable of West Yorkshire [1989] AC 53 at 63; Brooks v Commissioner of Police of the Metropolis [2005] 1 WLR 1495; [2005] 2 All ER 489 at [30].
• The fact that a common law duty of care would have a tendency to discourage the due performance of statutory duties: X (Minors) v Bedfordshire County Council [1995] 2 AC 633 at 739.
• The fact that imposition of a duty of care may undermine the effectiveness of the duties imposed by the statute: Graham Barclay Oysters (at [78]). This appears to be a restatement of the observations of Kirby J in Crimmins (at [216]), that the imposition of a common law duty could distort the performance of the functions of the statutory body in the attempt to avoid private actions.
352 In determining that the posited duty of care had not been established, Debelle J again focused upon the performance of the statutory duty and the likelihood of its impairment. At [180], his Honour said (emphasis added):
If the Board is subject to a duty of care, there is a real likelihood it will act defensively and be prone to cancel the release on licence, even for relatively minor infringements of conditions which have not caused harm. The Board is required to deal with people with a propensity to offend or at least to press their individual position to the limits. The Board must decide how it might best advance the process of rehabilitation. If the Board considers that, when exercising its discretion, it might be liable for an allegedly careless decision, it would be prone to excessively cautious decision-making and unduly disposed to cancel release on licence with the consequence that the process of rehabilitation would be stultified. A release on licence could be cancelled for the slightest breach of a condition. In short, a duty of care would lead to a detrimentally defensive frame of mind on the part of the Board. That in turn would undermine the effectiveness of the functions of the Board, if not also undermine the effectiveness of the statutory purpose to rehabilitate prisoners in a manner consistent with the safety of the public. Shortly put, the imposition of a duty of care would discourage the proper performance by the Board of the statutory functions committed to it.
353 The other member of the majority in X v South Australia was Duggan J. At [26], his Honour said this (emphasis added):
In the event that the Board was required to deal with an application to amend the conditions of release or cancel the release on licence of a person, it was exercising a discretion which may have involved competing interests of rehabilitation and protection of the public. There is good reason for holding that this discretion should not be inhibited by a duty of care.
354 Again, the concern of the Court was with the duty of care inhibiting the due performance of the statutory duty.
355 Likewise, in Tame, it was an inconsistency between the duty of care and the "performance" of the duty of the police-officer, which precluded a common law duty of care being recognised: at [24]-[27] (Gleeson CJ); at [57] (Gaudron J); at [231] (Gummow and Kirby JJ); and at [298]-[299] (Hayne J). In McKenna, as the Court said at [29], it was the performance of the statutory obligations of the medical practitioners which would not have been consistent with the duty of care. It was that which the Court regarded (applying Sullivan v Moody at [60]) as giving rise to "inconsistent obligations".
356 That, of course, is not to say that the performance of a statutory function and the content of that statutory obligation are unrelated. They will be closely related because the nature of the functions duly performed will be shaped by the nature of the obligation or power under which those functions must be performed including by reference to statutory purpose. The search for inconsistency or incoherence ought not be overly compartmentalised. In some cases it will be revealed by focusing on the process required to perform the statutory task. In others the nature of the statutory power itself may reveal an inconsistency. In each case, however, statutory purpose will be relevant. The characterisation process is not technical or formalistic, nor is it confined to legal effects. The presence of incoherence may be revealed by assessing the practical application and effect of the statutory power in question. In that respect, it seems to me that, ordinarily, whether there is "a real likelihood" (to adopt the phrase used by Debelle J in X v South Australia at [180]) of incoherence is an appropriate question when the performance of a statutory duty is being assessed.
357 That analysis involves a rejection of the applicants' restrictive approach to 'coherence' as earlier mentioned. However, the applicants are correct to say that a constraint or impairment upon discretionary power has commonly not precluded courts from finding that a duty of care may co-exist with a statutory discretion.
358 I turn then to consider the authorities relied upon by the applicants.
359 That liability in negligence may arise in the exercise of statutory powers is apparent from Speirs, which is the leading authority in the line of authorities relied upon by the applicants. In that case the respondent's husband died from injuries sustained in a collision between his vehicle and a runaway train. The collision occurred at a level crossing on a railway line constructed under statutory authority. Upholding the liability of the appellant railway operator, the majority (Dixon CJ, McTiernan, Kitto and Taylor JJ) relevantly said at 220 (citations omitted, emphasis added):
On the assumption [that the appellant was the subject of the authorities and immunities conferred by the private statutes], the well-settled principle applies that when statutory powers are conferred they must be exercised with reasonable care, so that if those who exercise them could by reasonable precaution have prevented an injury which has been occasioned, and was likely to be occasioned, by their exercise, damages for negligence may be recovered.
360 In circumstances where the deceased had suffered personal injuries caused by an event that was under the control of the appellants and from which he could not adequately protect himself, the majority had no difficulty in finding that a common law duty of care existed (at 221).
361 The principle in Speirs was cited by Mason J in Heyman at 458-459 to say that "[i]t is now well settled that a public authority may be subject to a common law duty of care when it exercises a statutory power or performs a statutory duty", and that "it has been generally accepted that, unless the statute manifests a contrary intention, a public authority which enters upon an exercise of statutory power may place itself in a relationship to members of the public which imports a common law duty of care". In Crimmins at [62], McHugh J referred to the principle in Speirs as dealing with a "settled" and "well-known" category of duty of care.
362 As Basten JA noted in Weber v Greater Hume Shire Council (2019) 100 NSWLR 1 at [29]-[30] (with Gleeson JA agreeing), the principle in Speirs is observable in the following passage of Sullivan v Moody at [60]:
The circumstance that a defendant owes a duty of care to a third party, or is subject to statutory obligations which constrain the manner in which powers or discretions may be exercised, does not of itself rule out the possibility that a duty of care is owed to a plaintiff. People may be subject to a number of duties, at least provided they are not irreconcilable.
363 There are many examples of that principle to which the applicants referred. It is sufficient to refer to two of those examples at this point.
364 In Pyrenees Shire Council, the Council had authority under the relevant statute to deal with fire prevention. The statute provided a discretion that the Council "may carry out or cause to be carried out any works or take any other measures for the prevention of fires". The statute also provided that, for the purpose of preventing fires, an owner or occupier of any land upon which a chimney or fireplace is erected "may", by notice in writing, be directed by the Council to alter the fireplace or chimney so as to make it safe. The tenants of two adjoining premises sued the Council in negligence for damages arising from property damage resulting from a fire caused by a latent defect in the chimney of the premises. The Council had inspected the premises about two years earlier, when different tenants were in occupation, and had found the defect. Although the Council wrote to the former tenants of the adjoining premises stating that it was imperative that the fireplace not be used unless fully repaired, the Council took no further steps. It had the statutory powers to require compliance with its notice, but it did not exercise them.
365 The High Court upheld the existence of a duty of care by the Council to exercise its powers to prevent a known risk of fire causing personal or property damage to members of a particular class of people (at [17], [25]-[26], [28] (Brennan CJ), at [108], [111]-[113], [115] (McHugh J), at [168]-[169] (Gummow J) and at [254]-[255] (Kirby J)) or where they are vulnerable to harm from immense danger which they cannot control, understand or recognise (at [107] (McHugh J) and at [255] (Kirby J)) in circumstances where the Council exercised significant and special control over that risk (at [168] (Gummow J)).
366 At [124] Gummow J said (citations omitted):
Sutherland Shire Council v Heyman established that the circumstance that a public authority is the repository of a statutory discretion does not prevent the application of the ordinary principles of the law of negligence.
367 At [168] Gummow J emphasised that the "touchstone" of the duty recognised was control and knowledge. His Honour cited with approval the dissenting judgment of McHugh JA (as his Honour then was) in Parramatta City Council v Lutz (1988) 12 NSWLR 293 at 328 where his Honour had said this (emphasis added):
In principle, there is much to be said for the view that a public authority should be under a duty to take affirmative action when the control of conduct or activities has been ceded to it by common understanding or when it receives some benefit from the conduct or activities. If in addition to the right of control the authority knows or ought to know of conduct or activities which may foreseeably give rise to a risk of harm to an individual, the authority should be under a duty to prevent that harm. Just as a teacher who has control of a classroom has a duty to prevent pupils from injuring others, so a public authority with legal or de facto control of a social situation should have a duty to take affirmative action to prevent harm to others. The touchstone of affirmative duty would be control and not the possession of any discretionary statutory powers. Failure to exercise such powers would go to breach of duty, but the common law duty would arise from actual or ceded control.
368 Despite the discretionary nature of the Council's power, including its discretion to take no action, the imposition of liability in negligence, it may be said, dictated that the Council's discretion should have been exercised to issue a notice requiring the fireplace or chimney to be altered to make it safe. The Council's failure to do so sounded in damages but no member of the Court suggested that there was an impairment of the Council's statutory discretion by the imposition of that liability. Justice Gummow at [179] expressly considered but rejected incoherence, at least in so far as the exercise of the Council's statutory powers to take additional fire prevention measures "would have interfered with the budgetary priorities of the Shire, or distorted its priorities in the discharge of its statutory functions". What should be noted, however, is that the imposition of liability in negligence was consistent with the obvious statutory purpose of the scheme which had conferred the discretion, that measures should be taken by the Council to pursue the prevention of fire.
369 In Crimmins, a statutory Authority (the Australian Stevedoring Industry Authority) was required by the relevant statute to perform its functions and exercise its powers "with a view to securing the expeditious, safe and efficient performance of stevedoring operations". One of the Authority's functions was to ensure sufficient waterside workers were available for stevedoring operations at each port. In performing that function the Authority allocated casual waterside workers to work from time to time for one or more of various stevedores which were registered to employ them at the port. Brian John Crimmins, a registered waterside worker, was employed between 1961 and 1965 by various stevedores to which he had been allocated to work by the Authority. Crimmins developed mesothelioma caused by exposure to asbestos in the course of the relationships of employment to which he was directed by the Authority. He asserted that the authority had failed to take reasonable care to avoid this foreseeable risk of injury.
370 A majority of the High Court (Gleeson CJ, Gaudron, McHugh, Kirby and Callinan JJ) found that the Authority owed Crimmins a duty of care. That finding involved a conclusion that the statute under which the Authority operated was not inconsistent with the recognition of such a duty. As to that conclusion, Gleeson CJ (at [3]) was in agreement with the reasons given by McHugh J to which I will return.
371 Justice Gaudron referred to the broad legislative statement of purpose or objective with which the Authority's functions and powers were to be exercised (as mentioned above). Her Honour considered it important that this encompassed the purpose of securing the safety of stevedoring operations (at [17]). Her Honour considered that that objective was entirely consistent with the existence of the posited duty of care (at [17]). Her Honour then noted the various functions of the Authority set out in the relevant statute and also its power to "do all such [things] as it sees fit" in the performance of its functions (at [20]-[21]). At [25], her Honour stated that it was "not in issue that a statutory body, such as the Authority, may come under a common law duty of care both in relation to the exercise and the failure to exercise its powers and functions". Her Honour then turned to further address the compatibility of the posited duty with the powers and functions conferred on the Authority. At [26]-[27], her Honour said this (citations omitted, emphasis added):
In the case of discretionary powers vested in a statutory body, it is not strictly accurate to speak, as is sometimes done, of a common law duty superimposed upon statutory powers. Rather, the statute pursuant to which the body is created and its powers conferred operates "in the milieu of the common law". And the common law applies to that body unless excluded. Clearly, common law duties are excluded if the performance by the statutory body of its functions would involve some breach of statutory duty or the exercise of powers which the statutory body does not possess.
Legislation establishing a statutory body may exclude the operation of the common law in relation to that body's exercise or failure to exercise some or all of its powers or functions. Even if the legislation does not do so in terms, the nature or purpose of the powers and functions conferred, or of some of them, may be such as to give rise to an inference that it was intended that the common law should be excluded either in whole or part. That is why distinctions are sometimes drawn between discretionary and non-discretionary powers, between policy and operational decisions and between powers and duties. Where it is contended that a statutory body is not subject to a common law duty in relation to the exercise or non-exercise of a power or function because of the nature or purpose of that power, what is being put is that, as a matter of implication, the legislation reveals an intention to exclude the common law in relation to the exercise or non-exercise of that power.
372 Having considered and negated any negative implication from a provision in the relevant statute which required that in the performance of its functions the Authority should avoid imposing limitations upon employers with respect to their control of waterside workers, her Honour expressed this conclusion at [30]:
In a context in which the Authority's functions were to be performed and its powers exercised "with a view to securing the expeditious, safe and efficient performance of stevedoring operations" (s 8), it is impossible, in my view, to derive any implication from s 17(2) to the effect that the Authority was not intended to be subject to a duty of care in relation to the performance of any of the functions set out above, including that of regulating the performance of stevedoring operations.
373 In what I think is an important discussion about coherence which serves to explain that the capacity to validly exercise a statutory power is not necessarily in tension with a co-extensive duty of care which may cut across its exercise, McHugh J at [81] to [83] said this:
Common law courts have offered a number of different solutions to the problem of imposing an affirmative duty of care on a statutory authority. In Stovin v Wise, Lord Hoffmann (with whose speech Lord Goff of Chieveley and Lord Jauncey of Tullichettle agreed) said:
In summary, therefore, I think that the minimum preconditions for basing a duty of care upon the existence of a statutory power, if it can be done at all, are, 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.
With great respect to the learned judges who have expressed these views, I am unable to accept that determination of a duty of care should depend on public law concepts. Public law concepts of duty and private law notions of duty are informed by differing rationales. On the current state of the authorities, the negligent exercise of a statutory power is not immune from liability simply because it was within power, nor is it actionable in negligence simply because it is ultra vires. In Heyman, Mason J rejected the view that mandamus could be "regarded as a foundation for imposing . . . a duty of care on the public authority in relation to the exercise of [a] power. Mandamus will compel proper consideration by the authority of its discretion, but that is all".
The concerns regarding the decision-making and exercise of power by statutory authorities can be met otherwise than by directly incorporating public law tests into negligence. Mr John Doyle QC (as he then was) has argued, correctly in my opinion, that there ''is no reason why a valid decision cannot be subject to a duty of care, and no reason why an invalid decision should more readily attract a duty of care".
374 In considering whether a common law duty of care was owed by the Authority, McHugh J first considered a number of what might now be described as salient features (at [100]-[113]). His Honour then considered the statutory scheme. His Honour referred to the broadly expressed purpose and object for the Authority's functions (at [115]) and then to various provisions of the relevant statute, noting at [127] that the Authority's power over stevedoring employers was limited by the statute. His Honour then addressed a central consideration - the purpose of the statutory scheme - and (at [127]) said this (emphasis added):
But nothing in the Act prohibited the Authority from taking steps to eliminate, so far as was reasonably practicable, the risk of harm to waterside workers. On the contrary, the obvious expectation of the Act was that the Authority would investigate the safety of waterfront conditions and encourage employers to eliminate unsafe practices. Furthermore, although the making of orders under s 18 was to be the result of a consultative process, the Authority had the power to make orders binding on one or more employers in respect of particular working conditions. The scheme and terms of the Act placed a responsibility on the Authority for the maintenance of a certain minimum standard of safety on the waterfront.
375 His Honour emphasised the Authority's function to ensure that standards of safety were observed (at [128]), and concluded that there was nothing in the relevant statute which forbade, or was inconsistent with the imposition of a common law duty of care on the Authority (at [129]-[130]). His Honour also considered, but rejected, the idea that the posited duty may distort the exercise of the Authority's powers by requiring the Authority to act defensively. In that respect his Honour said at [132] (emphasis added):
There are no other reasons to deny a duty of care. There are no considerations such as those that led the House of Lords to deny a duty of care in X (Minors) v Bedfordshire County Council - cutting across of a statutory scheme, the ''delicacy'' of the relationship between the parties or the fact that the officers of the Authority might adopt a ''more cautious and defensive approach to their duties''. Quite the opposite - in this case a recognition of a duty would likely have made the Authority more vigilant in its role. Nor do I think that the position of the Port Inspectors is analogous to the position of police officers, given that the Authority was charged with responsibility for the safety of a specific class - the waterside workers under its direction.
376 Coherence-based reasoning is evident in each of those extracts from Crimmins. No incoherence was observed by reference merely to the discretionary powers and functions of the Authority. Nor was the fact that liability in negligence dictated that the authority's discretionary powers should be exercised to avoid exposure of waterside workers to the risk of personal injury recognised as an impediment to coherence. It is again I think, important to observe that even though it is possible to say on the facts of Crimmins (as it was on the facts of Pyrenees Shire Council) that the valid exercise of the statutory discretion was affected by the imposition of liability in negligence, a purpose of the statutory scheme which had conferred the discretion was consonant with the imposition of that liability. Both the statute and the law of negligence were driven by a concern that reasonable care should be taken to avoid waterside workers being injured.
377 It is also important in my view, that despite the existence of discretionary powers in both Pyrenees Shire Council and Crimmins, the Council and Authority respectively had, by the exercise of their functions, either created or contributed to a danger and, in each case, a danger to the safety of the people or property that the Council or Authority had been charged with protecting. The common law ordinarily imposes a duty of care on a statutory authority where the act of the authority in the exercise of its functions has created a danger for the safety of others. As Mason J observed in Heyman at 460 (citations omitted):
But an authority may by its conduct place itself in such a position that it attracts a duty of care which calls for exercise of the power. A common illustration is provided by the cases in which an authority in the exercise of its functions has created a danger, thereby subjecting itself to a duty of care for the safety of others which must be discharged by an exercise of its statutory powers or by giving a warning.
378 In a passage cited and relied upon by McHugh J in Pyrenees Shire Council at [104], Mason J went on at 464 to say this (citations omitted):
[T]here will be cases in which the plaintiff's reasonable reliance will arise out of a general dependence on an authority's performance of its function with due care, without the need for contributing conduct on the part of a defendant or action to his detriment on the part of a plaintiff. Reliance or dependence in this sense is in general the product of the grant (and exercise) of powers designed to prevent or minimise a risk of personal injury or disability, recognised by the legislature as being of such magnitude or complexity that individuals cannot, or may not, take adequate steps for their own protection. This situation generates on one side (the individual) a general expectation that the power will be exercised and on the other side (the authority) a realisation that there is a general reliance or dependence on its exercise of power. The control of air traffic, the safety inspection of aircraft and the fighting of a fire in a building may well be examples of this type of function.
379 In Crimmins, it was the risk of harm to persons which as Gaudron J explained gave rise to a duty owed by a statutory authority such as the defendant in that case. At [25], and relying on each of the observations of Mason J in Heyman earlier cited above (either directly or by reference to the judgment of McHugh J in Pyrenees Shire Council), Gaudron J said (citations omitted):
It is not in issue that a statutory body, such as the Authority, may come under a common law duty of care both in relation to the exercise and the failure to exercise its powers and functions. Liability will arise in negligence in relation to the failure to exercise a power or function only if there is, in the circumstances, a duty to act. What is in question is not a statutory duty of the kind enforceable by public law remedy. Rather, it is a duty called into existence by the common law by reason that the relationship between the statutory body and some member or members of the public is such as to give rise to a duty to take some positive step or steps to avoid a foreseeable risk of harm to the person or persons concerned.
380 There are many other cases involving statutory authorities who have been found to owe a duty of care to take some positive step or steps to avoid a foreseeable risk of harm to a person or persons. Statutory authorities charged with the control and management of roads are a case in point. The governing statute for a road authority will inevitably provide the authority with a discretion as to where and when to apply its limited resources to the maintenance and repair of a road or a bridge. But that kind of statutory discretion has never been held to deny the existence of a duty of care concerned with a danger to the safety of persons brought about in the exercise of the powers of the road authority.
381 Brodie is an example of such a case. In the leading judgment of Gaudron, McHugh and Gummow JJ, their Honours at [140] observed that the powers vested in road authorities "give them a significant and special measure of control over the safety of the person and property of road users". Their Honours went on to say that that may have made it incumbent upon the Authority to exercise its powers, "by averting the danger to safety or by bringing it to the notice of persons in the situation of the plaintiff". Their Honours referred to the powers of the statutory authority in Pyrenees Shire Council as being powers that were in that category. At [142] their Honours said that the High Court in various circumstances "has favoured the imposition of a duty of care requiring the exercise of statutory powers affecting the safety of users of public roads". At [144] their Honours set out the observation of Gaudron J in Crimmins at [25] which I have quoted above.
382 The general proposition that their Honours were addressing in Brodie was perhaps best described at [102] as follows (citations omitted):
The decisions of this Court in Sutherland Shire Council v Heyman, Pyrenees Shire Council v Day, Romeo v Conservation Commission (NT) and Crimmins v Stevedoring Industry Finance Committee are important for this litigation. Whatever may be the general significance today in tort law of the distinction between misfeasance and non-feasance, it has become more clearly understood that, on occasions, the powers vested by statute in a public authority may give it such a significant and special measure of control over the safety of the person or property of citizens as to impose upon the authority a duty of care. This may oblige the particular authority to exercise those powers to avert a danger to safety or to bring the danger to the knowledge of citizens otherwise at hazard from the danger. In this regard, the factor of control is of fundamental importance.
383 What then are the discriminating features which distinguish the finding of incoherence in a case like MM Constructions, where an impairment upon decisional freedom did sound in incoherence, and cases such as Pyrenees Shire Council and Crimmins, where an impairment of a statutory discretion did not deny the holding that a duty of care existed?
384 That was a question which the Minister's submissions had to confront, and particularly so in the context of the Minister's contention that although a salient features multi-factorial approach applied, incoherence was here a determinative factor against a finding that the posited duty existed.
385 When so confronted, the Minister's able Counsel made a number of responses. An overarching response was that to reason by analogy with the cases was problematic. I disagree. It is entirely appropriate to assess the cases for guidance in a search for a rationale or principle which may reconcile why the decisional freedom of a statutory authority has been regarded as impermissibly curtailed in some cases but not of significance in others.
386 In distinguishing Pyrenees Shire Council and cases like it, where an authority had a statutory discretion whether or not to take a particular action, the Minister stated that a completely different kind of discretion was involved. So much may be true. A discretion not to act is different to a discretion to act in a particular way. However, why is that difference to be regarded as telling? Whilst the nature of the impairment upon the discretion may be different, the imposition of a duty of care can impair every kind of discretion and perhaps more so when the decisional freedom to take no action at all is impaired.
387 The Minister then suggested that the distinguishing feature was to be found in the nature of the power exercised, the subject of that power and the statutory context in which that power is exercised. That attempt to find an explanation descended into the "policy/operational" dichotomy which has largely been discredited (as discussed at [475]). Furthermore, it failed to account for the difference between the approach taken in MM Constructions as compared to that taken in a case like Alec Finlayson Pty Ltd v Armidale City Council (1994) 51 FCR 378, despite the statutory function (the approval of a development application) being the same and the statutory context provided by the statute (the promotion of environmental protection) being similar.
388 In Alec Finlayson, industrial use of certain land had led to contamination of the soil by toxic and carcinogenic substances. The Council rezoned the land, formerly in an industrial zone, as residential land. Subsequently, the Council granted development applications for subdivisions of the land for residential use, and thereafter approved plans of subdivision and building applications. The relevant statute required the Council, in determining a development application, to consider (amongst other things) whether the land was unsuitable for the development by way of susceptibility of flood, inundation, subsistence, slip or bushfire or any other risk. The Council knew the site was contaminated when it rezoned the land and granted development approval. The applicant purchased part of the land and commenced development but alleged that it had suffered loss when it was revealed that areas within the subdivision were seriously contaminated with chemicals. Justice Burchett determined that the Council owed a duty of care to the applicant in relation to its conduct in granting development approval for residential use.
389 Tellingly, in my view, Burchett J considered that a "fundamental feature" of that case was that the Council took positive steps which created a danger (at 409-410). Relying on the observations of Mason J in Heyman (at 459-460), Burchett J stated that when the Council took those steps it "created a danger, thereby subjecting itself to a duty of care for the safety of others" (at 410).
390 On appeal in Armidale City Council v Alec Finlayson Pty Ltd [1999] FCA 330 (Beaumont, Moore and Merkel JJ), the duty of care was upheld. The Full Court at [30] stated that it "does not follow from the fact that the Council was purporting to exercise its statutory function, that no cause of action in negligence could arise as a matter of statutory interpretation". Dealing with an argument which raised inconsistency between the duty of care and the existence of a statutory right of appeal, their Honours concluded there was nothing in the governing statute which would preclude the possibility of a cause of action arising at common law in appropriate circumstances (at [30]). Lastly, in upholding the finding of a breach of duty (at [32]) the Full Court said:
Given the serious public health hazard, the Council's duty could only have been competently discharged by an outright refusal of the application, or at least a refusal except upon acceptance and performance by the applicant for approval of appropriate remediation conditions.
391 Here then is a clear and unequivocal instance of the imposition of liability in negligence dictating the exercise of a broad statutory discretion to approve or not approve an action. Yet there was no relevant suggestion of incoherence made either by Burchett J or the Full Court. There are other examples of cases in which the intersection of liability in negligence and a statutory power of approval did not give rise to any suggestion of incoherence: Voli v Inglewood Shire Council (1963) 110 CLR 74 (Dixon CJ, Windeyer and Owen JJ); Wollongong City Council v Fregnan [1982] 1 NSWLR 244 (Hutley, Glass and Mahoney JJA); Bamford v Albert Shire Council [1998] 2 Qd R 125 (McPherson and Pincus JJA, and Thomas J); and Port Stephens Shire Council v Booth [2005] NSWCA 323 (Beazley and Giles JJA, and Hunt AJA);
392 When challenged to distinguish Alec Finlayson, Counsel for the Minister made this observation (emphasis added):
That was contaminated land where the local Council knew that land was unfit for human occupation, [and] notwithstanding that, it rezoned the land and granted development consent for someone to reside on that land…It could not possibly have been suggested that the way that the statutory discretion to grant a consent operated, was that the Parliament intended that the Council could weigh up [whether it was or was not] appropriate to allow people to occupy a carcinogenic block of land.
393 I think there is force in that observation. It may readily be appreciated that the statutory scheme considered in Alec Finlayson would not have contemplated the safety of persons as anything other than a relevant consideration of great weight. A legislative expectation of that kind, in circumstances where a statutory authority exercises its power in relation to a matter which may endanger the safety of persons, may be thought to be so obvious that it really goes without saying. To employ the language of McHugh J in Crimmins at [127], the "obvious expectation of the Act" was that human safety would be protected in the exercise of the Council's discretion to approve a development of land for human habitation. If that be so, the imposition of a duty of care upon the Council to take reasonable care to avoid the harm contemplated by the statute could not have been incoherent with the intent of the statutory scheme but, to the contrary, would sit conformably alongside it. Or, as McHugh J in Crimmins said in dealing with the possibility of distortion of the statutory discretion at [132], rather than distorting the discretion the recognition of a duty "would likely have made the Authority more vigilant in its role".
394 Alec Finlayson demonstrates, again, that liability in negligence may cut across, impair or dictate the exercise of a statutory discretion (including an approval power) without incoherence being observed. Like Pyrenees Shire Council and Crimmins, the duty of care imposed by the law of negligence was consonant with a purpose of the statutory scheme in question.
395 In reconciling the authorities, what must be recognised is that coherence-based reasoning places great importance on statutory purpose cohering with the imposition of liability in negligence. Consistency between statutory purpose and the duty of care imposed by the law of negligence is apt to be regarded as a potent consideration favouring a conclusion of coherence. An interference or impairment of a statutory discretion conferred by the statute has negative implications for coherence. However, both considerations must be weighed. As statutory discretion is subordinate to statutory purpose because a discretion is to be exercised "only in accordance with the objects and policy of the Act" (Walton v Gardiner (1993) 177 CLR 378 at 409 (Brennan J)), consistency with purpose will be the paramount consideration.
396 The cases relied upon by the Minister can be reconciled with those relied upon by the applicants, once it is recognised that coherence between the imposition of liability for negligence and a statutory power or discretion requires a consistency assessment which has regard to both statutory purpose and statutory function and which will ordinarily give priority to consistency between the purpose of the statute and the concern or object of the duty of care. In MM Constructions, in X v South Australia and in Sullivan v Moody, there was no consistency or coherence with statutory purpose capable of negating the inconsistency with the discretionary function. To the contrary, the statutory purpose itself was inconsistent with the imposition of liability in negligence.
397 I turn then to assess the coherence of the imposition of the posited duty of care with the EPBC Act and the Minister's approval function under s 130 and s 133. The posited duty is concerned with the avoidance of various categories of harm to the Children. I will deal first with safety and that aspect of the posited duty of care which is concerned with the avoidance of personal injury to the Children. That concern is, in my view, both consonant with a purpose of the statutory scheme of the EPBC Act and a relevant consideration that the Minister must take into account in exercising her power of approval under s 130 and s 133 of the EPBC Act.
398 The preservation of human life and the avoidance of personal injury is likely to be a relevant consideration whenever decisions are made about a matter which may give rise to a danger to human safety. That simply reflects the importance our community attaches to the preservation of life and personal safety. An expectation that a statutory power will not be used without care being taken to avoid killing or injuring persons will almost always cut across the exercise or performance of a statutory power including a broad discretionary power. It is unlikely that a societal priority of that magnitude would not be reflected and accommodated in any statutory scheme which provided a statutory authority the capacity to carry out functions which could endanger human safety. It would therefore be surprising for incoherence to arise between a common law duty to take reasonable care for the lives and safety of persons and a statutory scheme which contemplates that the powers it confers would not be used to unreasonably endanger the lives and safety of persons.
399 The avoidance of death and personal injury to humans by the taking of reasonable care may legitimately be regarded as the obvious intent of any legislative scheme which confers functions or powers capable of creating a danger to human safety, unless a contrary intention is shown. Parliament may be assumed to have intended that in the performance of the powers and functions conferred by it, reasonable care will be taken to avoid endangering the safety of humans. Unless legislation has identified considerations which are to take priority over human safety or which are to compromise the natural priority that attends human safety, Parliament may be taken to have intended that the priority given to safety by the community is reflected in the statutory scheme it has created.
400 There are, of course, instances where a contrary intention may be indicated. Sometimes the personal safety of different classes of persons will be in contest. Sullivan v Moody exemplifies that situation. The compatibility analysis in Sullivan v Moody required the mental injury to persons suspected of causing personal injury to children to be assessed against the statute's clear intent to protect children, including from personal injury occasioned by sexual abuse. The statute's primary concern to protect the safety of children was paramount and circumscribed the extent of the scheme's concern to avoid injury to others.
401 Sometimes, the avoidance of personal injury must give way to a consideration which the statute regards to be more important. X v South Australia is an exceptional case of that kind but is explained by its unique statutory context. The dominant relevant interests in contest under the scheme there in question - the liberty of the individual and individual safety - are both fundamental interests of high societal value. The scheme was concerned with the safety of individuals but countenanced that the need to rehabilitate prisoners and release them from detention may compromise the safety of others (at [179] (Debelle J)). It was in that context that the majority held that the decisional freedom given by the statute to the decision-maker to achieve the statute's intended balancing of interests was not to be impaired by a duty to take care not to harm the safety of those individuals who may be harmed upon a prisoner's release.
402 The EPBC Act contemplates that competing interests be taken into account in a decision made under that Act to approve or not approve a controlled action and that a balance may be struck between those competing interests. However, there is nothing to suggest that in the context of an approval potentially creating or contributing to a danger to human safety, the priority usually given to the need to take reasonable care to avoid endangering the safety of humans in almost any decision-making process, has not found its natural place in the intended statutory balance as a relevant consideration deserving at least elevated weight.
403 The concern of the EPBC Act for human health and safety is, to some extent, reflected expressly in various provisions of that Act. The process under which threatened species which enjoy the EPBC Act's protection are identified and "listed" by the Minister is a case in point. Reflecting the obvious priority given to human species over other species, s 193(1) empowers the Minister to determine that a species is not appropriate for inclusion as a listed species where the Minister is satisfied that a native species "poses a serious threat to human health". Additionally, conduct taken to preserve human safety or human health is exculpated from liability for various offences created by the EPBC Act: see ss 212, 236 and 255.
404 The Minister's contention that the recognition of the posited duty would in practical terms impose a distortion upon the Minister's discretion, was premised on harm to the Children not being a mandatory consideration required to be taken into account in an approval decision under s 130 and s 136. I disagree. Human safety is a relevant mandatory consideration in relation to a controlled action which may endanger human safety. In relation to a controlled action of that kind, the lives and safety of the Children are not optional considerations but have to be taken into account by the Minister when determining whether to approve or not approve the controlled action. That implication is found in the "subject-matter, scope and purpose" of the EPBC Act: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 40 (Mason J).
405 As discussed above at [158], the EPBC Act's purpose is in part protective of people and communities as a defined part of the environment. It is impossible to accept that if the Minister was called upon to approve or not approve an activity which potentially endangers human safety - for example, the extraction of asbestos from a new mine - the scheme of the EPBC Act would permit the Minister to choose freely whether or not she should consider human safety in making her decision.
406 I do not consider human safety to be a permissive rather than mandatory consideration. I accept that the economic or property interests of humans are permissive considerations within the mandatory category of "social matters" described in s 136(1)(b). However, there is nothing "social" about the protection of life and limb. In my view human safety sits outside of the categories specified by s 136(1). It is a relevant consideration which arises by implication from the subject-matter, scope and purpose of the EPBC Act.
407 Faced with a controlled action which poses a real risk to the safety of members of the Australian community, the Minister may be expected to give at least elevated weight to the need to take reasonable care to avoid that risk of harm. To do so would be consonant with the policy of the EPBC Act. In such circumstances, the imposition of a duty of care which may, as a practical matter, impose a requirement upon the Minister to consider and give elevated weight to the need for reasonable care to be taken to avoid death or personal injury will not distort the Minister's discretion or skew the intended statutory balance.
408 As the posited duty would be in harmony with the statutory scheme in relation to the need to protect the safety of humans, there is no reason to think that it is likely the Minister would exercise her discretion with a "defensive frame of mind" to avoid potential liability for damages by reason of the posited duty. Furthermore, the defendant here is the Commonwealth of Australia and it has the capacity to immunise itself from liability for damages. It is difficult to see why the potential for liability which could have been avoided by the Commonwealth, but was not, should properly be regarded as giving rise to an inconsistency because the Commonwealth would be motivated to avoid the liability which it chose not to avoid. Additionally, the reasoning of McHugh J in Crimmins at [132] needs to be taken into account. His Honour regarded that vigilance rather than defensiveness would likely result from the imposition of liability in negligence where statutory purpose and the concern or objective of a duty of care are consonant.
409 For all those reasons, I do not accept that the process-based impairments upon the exercise of power under s 130 and s 133 which the Minister relied upon are made out in relation to that part of the posited duty of care concerned with the avoidance of personal injury. If the likelihood of that kind of impairment had been established, I would nevertheless have regarded it as outweighed by the consistency between statutory purpose and the duty of care in relation to the avoidance of personal injury to the Children.
410 I turn then to consider the outcomes-based impairment upon which the Minister relied in asserting that the imposition of a duty of care would dictate the exercise of her discretion. There are a number of difficulties with that assertion. Although the imposition of liability in negligence may have the effect of dictating the exercise of a discretion, that would not be the effect of merely recognising a duty of care. Liability in negligence is imposed by a breach of a duty of care not simply by the recognition that a duty of care exists. The recognition of the posited duty of care will not, of itself, dictate the non-approval of the Extension Project.
411 The Minister's assertion of that kind of impairment was really premised on non-approval being the inevitable result of the imposition of a duty of care. However, liability in negligence is assessed against the content of a duty of care and the test, at the level of breach, is different to that at the level of duty. The content of a duty of care, as assessed at the level of breach, includes the reasonableness of a defendant's response. As Mason J said in Shirt at 47-48, the reasonableness of the response:
calls for a consideration of the magnitude of the risk and the degree of the probability of its occurrence, along with the expense, difficulty and inconvenience of taking alleviating action and any other conflicting responsibilities which the defendant may have. It is only when these matters are balanced out that the tribunal of fact can confidently assert what is the standard of response to be ascribed to the reasonable man placed in the defendant's position.
See also Brodie at [151] (Gaudron, McHugh and Gummow JJ).
412 As was emphasised by Gaudron, McHugh and Gummow JJ in Brodie at [162] at the level of breach, "[t]he formulation of the duty of care includes consideration of competing or conflicting responsibilities of the authority". Further, as Gaudron J said in Crimmins at [34], a common law duty in relation to the exercise or non-exercise of the power of a statutory authority "only imposes a duty to take those steps that a reasonable authority with the same powers and resources would have taken in the circumstances in question" (see further McHugh J in Crimmins at [90]).
413 The response that will be required by the Minister to avoid liability in negligence should a duty of care be recognised depends upon a range of considerations to which not very much attention was paid to at the trial. I am not in a position to say that the inevitable result of the recognition of the posited duty of care is the disapproval of the Extension Project (see further the discussion at [502]-[503] below). It would be premature to observe incoherence at the level of duty when the incoherence contended for may or may not arise at the level of breach in circumstances where, as Spigelman CJ said in State of New South Wales v Paige (2002) 60 NSWLR 371 at [105], "[t]he issue of inconsistency or incompatibility may arise, like many other elements, at both the level of duty and the level of breach".
414 In any event, even if at the level of duty a foreclosure of the Minister's discretion is observable, that functional impairment must be weighed against the consistency of statutory purpose and the duty of care in relation to the avoidance of personal injury to children. In my view, when so weighed and taking into account that statutory discretion is subordinate to statutory purpose, there is no observable incoherence or, at least, no sufficient incoherence to regard this salient feature as determinative.
415 In arriving at that conclusion I have been mindful of the Minister's submission which placed great weight on the fact that the EPBC Act imposes a duty on her to make a decision. That submission is not without some force. However, there is also force in the response to it made by the applicants. The Minister's duty to decide is made express by the EPBC Act. However, that duty is hardly unique. Any repository of a statutory power who is given a capacity to decide whether to approve or not approve an application, or otherwise decide upon a particular matter ordinarily has a duty to exercise that power which, eventually, mandamus will compel. It is not the existence of a duty to decide which, of itself, raises incoherence. The imposition of a duty of care, or the imposition of liability in negligence, will not preclude the Minister from performing her duty by determining the application before her.
416 I have reached a contrary conclusion in relation to that part of the posited duty of care which concerns property damage and economic loss. The scheme of the EPBC Act contains no suggestion that in the broad range of interests that need to be considered by the Minister, the loss of property or economic loss that may be inflicted upon the Children is to be treated differently to any other financial interest that the Minister may consider. True it is that the EPBC Act promotes the principle of inter-generational equity (s 3A(c)). That would tend to suggest that the interests, including the economic interests, of the Children as well as future generations should be counted in the statutory balance to be struck by the Minister. But that does not mean that the importance of those interests should necessarily be elevated above the economic interests of today's adults. For essentially the same reasoning as that applied by Allsop P in MM Constructions at [98] (as set out earlier), the imposition of a duty of care requiring the Minister to take reasonable care to avoid loss of property or economic loss occasioned upon the Children, would likely distort or skew the exercise of the Minister's broad discretion. There is no statutory purpose requiring that economic or property rights be protected. Indeed the scheme of the EPBC Act contemplates that interests or rights of this kind may be compromised in order to protect the environment. There is therefore no resort to statutory purpose which is available to negate the functional inconsistency in question. Accordingly, in this respect incoherence is made out determinatively, and denies the existence of a duty of care extending to property and pure economic loss.
417 Lastly, I should deal with a different aspect of the statutory scheme which the Minister asserted the posited duty of care would distort. The Minister contended that the EPBC Act established a particular scheme for arming the Minister with the information she needs to approve or not approve a controlled action. That scheme, so the Minister contended, is directed to the provision of information on the "impacts" of an action upon a matter protected by a provision of Pt 3. Given the restricted causal standard in the definition of "impact" in s 527E, the Minister submitted that the information which may be provided about an "impact" and which the Minister is required to take into account pursuant to s 136(2)(e) would not deal with indirectly caused events or consequences of a controlled action such as climate change leading to harm of the kind sought to be avoided by the posited duty of care. It was said that, in the context of that scheme, the posited duty is inconsistent with the statutory scheme because the scheme fails to accommodate the posited duty by not arming the Minister with the information necessary to discharge the duty.
418 This submission is without merit. The EPBC Act must contemplate that information can be put before the Minister to enable the Minister to carry out her statutory task. That task includes the Minister taking into account a wide range of matters and not merely the direct impacts of a controlled action upon a matter protected by a provision in Pt 3. The broad power given to the Minister by s 132 to request information, provides the Minister with the means of obtaining relevant information not already put before her. There is no potential for an information deficit of the kind contended for by the Minister which would demonstrate inconsistency or incoherence between the posited duty and the statutory scheme.
419 The Minister also contended that the imposition of the posited duty would be incoherent with administrative law principles. That was said to be so because the recognition of the alleged duty would be inconsistent with the limited role of the courts in supervising the legality of statutory decision-making, as it would involve the courts in considering the merits of an administrative decision.
420 There are two broad observations that should be made at the outset of this discussion. The first was made in South Australia v Commonwealth (1962) 108 CLR 130 where Dixon CJ (at 140) said that "the subject matters of private and public law are necessarily different". The second observation is that the first observation does not deny that the law of tort may bear directly upon the conduct of public administration. That second observation, made with reference to the observation of Dixon CJ, was made by Gummow J in Pyrenees Shire Council at [123] where his Honour said at [123] (citations omitted):
That is not to deny that the law of tort, with its concerns for compensation, deterrence and "loss spreading", may bear directly upon the conduct of public administration. The established actions for breach of statutory duty and for misfeasance in public office counter any such general proposition. Again, significant questions of public law have been determined as issues in actions in tort, particularly in trespass. Further, in this country, sovereign immunity in tort was modified or removed long before the enactment of the Crown Proceedings Act 1947 (UK) and the Federal Tort Claims Act of 1946 (the US Tort Claims Act) in the United States, and there is a long history here of the entrusting of governmental functions to statutory corporations.
421 The Minister relied upon the observations made by Allsop P in Precision Products at [119] that:
if standards of administration are to be regulated and enforced by recourse to the recovery of damages at common law, the courts must necessarily become involved, not just in the constitutional role of ensuring legality, but also in laying down standards of administrative conduct by reference to a standard of reasonable care.
422 The Minister's contention has force but only if the principle upon which it depends is confined to the territory in which it truly operates.
423 The role of the courts in judicial review of administrative decisions is, as Allsop P put it, that of ensuring legality. That is done by assessing whether an impugned administrative decision is legally valid. It is not done and cannot be done consistently with administrative law principles by reference to the merits of the decision, including by a consideration of whether the impugned decision was made with reasonable care.
424 Where the content of a duty to exercise reasonable care is directed to the making of a valid decision (that is, a duty to take reasonable care to make a valid decision or not to make an invalid decision) incoherence between the posited duty and administrative law principles may arise. Incoherence in that situation arises because a particular and specific procedure for addressing legally invalid administrative decisions, including as to the nature of the relief available, already exists and the policy of the legislature in question will be understood as intending to preclude the imposition of a different procedure for addressing the same subject: see the discussion of Spigelman CJ in Paige at [132]-[155].
425 Where in form or in substance the subject of the posited duty is the legal validity of the administrative decision, there will likely be incoherence between the posited duty and administrative law. That was the position in Precision Products. The incoherence with administrative law was identified by Allsop P at [120] as "the positing of a duty to exercise reasonable care not to make a flawed decision by, for instance, failing to give procedural fairness or failing to confine the power within statutory limits".
426 However, those are not the circumstances of this case. The subject of the posited duty is not the validity of any decision made or to be made by the Minister under the EPBC Act. The posited duty, whether assessed at the level of duty or at the level of breach, is not that the Minister must exercise reasonable care not to make a flawed decision either generally or by reference to any particular instance of flawed decision-making. The subject of the posited duty is not, in either form or substance, legally invalid decision-making. No part of the applicants' case in negligence, neither in their assertion of a duty nor in their assertion of a prospective breach, relies upon a contention that any decision taken or to be taken, or any step taken or to be taken, in the process of decision-making, is or will be legally invalid. Their action in negligence is "not brought in addition to or in substitution for any public law remedy": Pyrenees Shire Council at [172] (Gummow J).
427 Accordingly, I reject the Minister's contention that the posited duty of care is incoherent with administrative law principles.