6.3.5.3 "…as a result of… outbreak or discovery of… likely to result in the occurrence"
258 The issue is whether the orders (or any of them) were as a result of "outbreak of a notifiable human infectious or contagious disease" or "discovery of an organism likely to result in the occurrence of a notifiable human infectious or contagious disease" at or within a 5 kilometre radius around the Situation.
259 LCA Marrickville (and other insureds) relied on two approaches - the first textual and the second evidentiary. The textual approach relies on the text of the orders and extrinsic material explaining the reasons why they were made. The second relies on proof of the existence of COVID-19 within the 5 kilometre radius around the Situation.
260 LCA Marrickville conceded that none of the orders relied upon "are specific enough to identify an outbreak in the terms used in the second line of 9.1.2.1. That is, within 5 kilometres of LCA Marrickville". That is, the textual approach does not enable an inference to be drawn that any of the orders were as a result of "outbreak of a notifiable human infectious or contagious disease" or "discovery of an organism likely to result in the occurrence of a notifiable human infectious or contagious disease" at or within a 5 kilometre radius around the Situation.
261 As Swiss Re submitted, the difficulty is that the insureds have otherwise explained why the textual approach is correct. In short, given the context and text of the insuring clauses, if an authority has made an instrument and the instrument explains on its face why it was made, there would need to be good reason to attempt to go behind the face of the instrument to ascertain if it might be inferred that some other reason was the or a cause of the making of the instrument. As it was put for Taphouse: (a) it is unlikely an insured could obtain evidence as to an authority's reasons for acting, (b) even if the insured could obtain that evidence, statutory instruments usually speak for themselves, (c) as with a statute, a statutory instrument evinces its intention by the language used, and (d) it is not permissible to contradict the language of the instrument.
262 Accordingly, if the order itself identifies why it has been made, either expressly or by implication, I doubt that a search for contrary or supplementary evidence is likely to be able to yield anything useful. If the order does not identify why it has been made, either expressly or by implication, then other evidence may be useful, provided it is evidence about what he authority knew and considered at the time it made the orders.
263 I should record that I accept the insured's submission that it is not necessary for an insured to prove any objective fact as to the existence of the relevant disease for a provision such as cl 9.1.2.1. The relevance of the objective fact as to the existence of the relevant disease is mediated through the order. This is because the relevant objective facts are the existence of the order and whether it resulted from the specified circumstances. The objective fact of the existence of the specified circumstances may assist in enabling inferences to be drawn about the cause of the order, but that is all.
264 In particular, an authority can wrongly issue an order and the requirements of cl 9.1.2.1 may nevertheless be satisfied. If it were otherwise cover could be denied even if the order merely because the authority made some kind of error that was reasonably open to it and discovered only subsequently. For example, assume a closure order resulting from the discovery of legionella in an air conditioning system. The premises are ordered to be closed while testing is carried out. The testing shows that the legionella bacteria are present but are inactive and harmless (which may not be scientifically possible but the point is still good). The order resulted from the authority considering that the legionella bacteria were "likely to result in the occurrence of a notifiable human infectious or contagious disease" at or within a 5 kilometre radius of the Situation. Clause 9.1.2.1 would be satisfied even if the testing subsequently proved that the bacteria was not in fact "likely to result in the occurrence of a notifiable human infectious or contagious disease" at or within a 5 kilometre radius of the Situation.
265 It could not be taken that the parties intended that the insured would not be covered for acts of an authority in good faith which can objectively be characterised as resulting from the nominated circumstances even if it can be subsequently proved that the authority was in error. While there may be some limits to this conclusion, such as an order issued arbitrarily or capriciously or in bad faith, no such considerations on the part of any authority arise in the present case (or any of the cases).
266 In Rockment at [36] the Full Court noted that:
Whilst it may not be useful to divert attention to the myriad alternative circumstances on which the clause might operate, it is true that a construction which connects the operation of the Exclusion to an objectively discernible fact has a degree of commercial rationality. But that is not what the Exclusion says, which is the primary consideration. In any event, a construction which identifies the relevant causal element as being the emergency state of affairs which is the subject of a declaration also attaches to an objective element.
267 I consider this supports the view I have reached. The objectively discernible fact is the making of the order which must be a result of the identified circumstances. The clause, in effect, submits the parties to the actions of the relevant authority as the required objective fact. This makes far more commercial sense than requiring the parties to ascertain (and potentially dispute) the existence or non-existence of the identified circumstances, including by reference to matters that were not known to or considered by the authority when it made the orders.
268 By the clause the parties are evincing a common intention that the objective actions of the authority determine the availability of cover. The parties must be taken to have understood that an authority with the requisite power would be bound to act lawfully and on a rational basis. But this does not mean that: (a) an authority might not later be proven to be wrong, or (b) subsequently available information proving more than the authority knew or more than the authority acted upon can be relevant. The parties are stuck with the actions of the authority taken in the circumstances known to the authority at the time as the determinant of cover. This is a commercially rational and sensible resolution of the operation of the clause.
269 This is important because it exposes why the various causal sequences which the insurers provided for assistance are fraught. The causal sequences all start with the identified or specified circumstance as if that has to exist as a matter of objective fact. That is not so for the reasons given. The start of the relevant causal sequence for hybrid clauses is the making of the order by the authority. It is true that the cause for the making of the order must be as identified by the clause (so that the circumstance must exist before the order) but that does not mean that the parties are able to go behind the order to prove the authority wrong or to prove that another order, in different terms and for different reasons, could have been made.
270 This all said, one way or another, the insured must prove that the order resulted from the specified circumstances. The starting point (and, in my view in most cases, at least where the reason for the order is apparent on or may be inferred from the face of the order and accompanying extraneous material, the finishing point as well) must be the terms of the order and any accompanying contemporaneous explanatory material.
271 The orders were made under s 7 of the Public Health Act. Section 7 applies if the Minister considers on reasonable grounds that a situation has arisen that is, or is likely to be, a risk to public health and enables the Minister to by order give such directions as the Minister considers necessary to deal with the risk and its possible consequences, including by declaring any part of the State of NSW a public health risk area and in that event to reduce or remove any risk to public health in the area, to segregate or isolate inhabitants of the area, or to prevent, or conditionally permit, access to the area.
272 As noted, the orders identify the grounds for concluding that there is a risk to public health in cl 4. Clause 4 records that:
It is noted that the basis for concluding that a situation has arisen that is, or is likely to be, a risk to public health is as follows -
(a) public health authorities both internationally and in Australia have been monitoring international outbreaks of COVID-19, also known as Novel Coronavirus 2019,
(b) COVID-19 is a potentially fatal condition and is also highly contagious,
(c) a number of cases of individuals with COVID-19 have now been confirmed in New South Wales, as well as other Australian jurisdictions, [including by means of community transmission].
273 The words "including by means of community transmission" did not appear in the 26 March 2020 order but do appear in subsequent orders including that of 1 June 2020.
274 The Explanatory Note to the 26 March 2020 order records that the object of the order is to "make further provision to deal with the public health risk of COVID-19 and its possible consequences".
275 Given this, I am unable to accept that the orders on which LCA Marrickville relied were as a result of anything in fact occurring at or within 5 kilometres of the Situation. They resulted from the Minister's concern about the public health risk COVID-19 presented to the State of NSW as a whole. There is a crucial difference between the "risk" or "threat" of an outbreak of COVID-19 and an outbreak of COVID-19. While the risk or threat is based on the existence of COVID-19 in some locations (not every location) in the State, it is only the risk or threat which relates to the State as a whole (and every person in the State). The existence of COVID-19 in certain locations (that is, the outbreak or occurrence of COVID-19) does not relate to the State as a whole.
276 The fact that the Situation and the area within 5 kilometres of the Situation is within NSW does not mean that it can be said that the orders resulted from COVID-19 at the Situation or within the 5 kilometre radius. To so conclude would be to render the causal connection between the order and the 5 kilometre radius around the Situation meaningless. The causal connection identified by the words "as a result of" link the order and circumstances within the 5 kilometre radius.
277 The text of the orders is inconsistent with any inference that the orders were a result of anything to do with the existence of COVID-19 (as an outbreak or otherwise) within the 5 kilometre radius. The orders resulted from the circumstances relating to COVID-19 in NSW generally. Those circumstances included: (a) the existence of COVID-19 in certain locations within NSW (but not at every location within NSW), and (b) the risk or threat of the spread of COVID-19 within NSW from both known and unknown cases of COVID-19.
278 LCA Marrickville submitted that the "fact that the threat was recognised to exist both inside and outside the radius does not matter. What matters is that the orders were in response to an outbreak in the relevant area, which includes the radius". Importantly, and as noted, cl 9.1.2.1 is not about the threat or risk of disease. It is about an order as a result of an outbreak of a disease or discovery of an organism likely to result in the occurrence of a disease. This is an important difference from cl 9.1.2.6 which is focused on the action of an authority to avoid or diminish risk. The inference of recognition by the authority of an outbreak or discovery of the required kind within the radius cannot be drawn. Such reasoning might be legitimate for an order concerning a smaller area, but it is not legitimate when the order resulted from circumstances in the whole of NSW. As noted, if that were sufficient, the Situation and the radius have no work to do in respect of the requirement of causality between the order and the disease.
279 The conclusion which must be reached on the textual approach is that the orders were not a result of an outbreak of disease at the Situation or within a 5 kilometre radius of the Situation or discovery of an organism likely to result in the occurrence of disease at the Situation or within a 5 kilometre radius of the Situation. The circumstances within the radius in terms of an outbreak or likely occurrence of a disease (as opposed to a risk or threat of disease across NSW as a whole) were not a proximate or any other kind of cause of any of the orders. The textual approach should be the end of the matter.
280 Proof of the fact of cases of COVID-19 at the Situation or within the 5 kilometre radius of the Situation before the orders were made does not prove that the orders resulted from an "outbreak" or "occurrence" of COVID-19 at the Situation or within the 5 kilometre radius of the Situation as it does not prove that the Minister may be inferred to have: (a) known of that circumstance before making the order, unless the proof is contemporaneous documents of which it may be inferred the Minister was aware (such as contemporaneous NSW Health records provided to the Minister), (b) taken into account that circumstance before making the order, or (c) acted in part on the basis of that circumstance. For this reason, the possibility of further non-contemporaneous epidemiological evidence being adduced is beside the point.
281 As discussed, the FCA v Arch and Hyper Trust cases take a different view but that is because those cases considered areas which included the majority of the population centres in each country. As Insurance Australia submitted:
…as part of their reasoning, Lord Hamblen and Lord Legatt rejected a submission that 'but for' was a minimum requirement for causation. Their Lordships accepted that a 'but for' test was a relevant causal inquiry in the 'vast majority of insurance cases', but held it was not a necessary pre-condition to a finding of causation in all cases: at [181]-[183]. IAG does not contest this statement as a matter of principle. It accepts that under Australian law the 'but for' test is not the sole or minimum requirement to establish causation under an insurance contract. Indeed, as recognised in FCA v Arch at [187], Allsop J's decision in McCarthy [McCarthy v St Paul International Insurance Co Ltd [2007] FCAFC 28; (2007) 157 FCR 402] (being a case concerning the recoverability of defence costs incurred in respect of two claims, only one of which was insured) is one example where the Court has been willing to find loss was caused by a particular event even though the 'but for' test could not be satisfied. The inefficacy of a 'but for' test in cases of multiple sufficient causes is well known.
… it is important to have regard to the reason why a 'but for' test was not applied in FCA v Arch. The specific reason given (at [179]) was that a 25-mile radius (being the relevant radius in the disease clauses there being considered) covered a significant proportion of England and Wales. This meant, in turn, that it would be a difficult if not impossible task for the insured to demonstrate that, but for the cases of COVID-19 within the particular 25-mile radius of its insured premises, the relevant government restrictions would not have been introduced and the interruption to business would have been any less: at [179]. The prior case law on concurrent causes was distinguished expressly on this basis: at [180] ('The facts of the present case are distinguishable in this respect from the facts in the cases referred to above…'
…
… finally, at [190], Lord Hamblen and Lord Legatt made the important observation that:
Whether an event which is one of very many that combine to cause loss should be regarded as a cause of the loss is not a question to which any general answer can be given. It must always depend on the context in which the question is asked. Where the context is a claim under an insurance policy, judgements of fault or responsibility are not relevant. All that matters is what risks the insurers have agreed to cover.
282 In particular, there is a fallacy in the argument for LCA Marrickville that if "the risk exists within the radius, and the order is made in response to it, it is a red herring to say it might also exist outside that radius", referring to FCA v Arch UKSC at [194] as follows:
The parties to the insurance contracts may be presumed to have known that some infectious diseases including, potentially, a new disease (like SARS) can spread rapidly, widely and unpredictably. It is obvious that an outbreak of an infectious disease may not be concerned to a specific locality or to a circular area delineated by a radius of 25 miles around a policyholder's premises. Hence no reasonable person would suppose that, if an outbreak of an infectious disease occurred which included cases within such a radius and was sufficiently serious to interrupt the policyholder's business, all the cases of disease would necessarily occur within the radius. It is highly likely that such an outbreak would comprise cases both inside and outside the radius and that measures taken by a public authority which affected the business would be taken in response to the outbreak as a whole and not just to those cases of disease which happened to fall within the circumference of the circle described by the radius provision.
283 The first fallacy is that the submissions confuse the concepts of outbreak/occurrence of COVID-19 with the risk or threat of COVID-19. The insured peril in cl 9.1.2.1 is the fact of an outbreak or the fact of discovery likely to result in the occurrence of disease at or within the 5 kilometre radius of the Situation. It is not the risk or threat of COVID-19 at or within the 5 kilometre radius of the Situation. It is not the risk or threat of COVID-19.
284 The second fallacy is that the proposition assumes the result, that the order(s) were made in response to circumstances within the radius. The reasoning in FCA v Arch UKSC, if applied in the present case, would also assume how the policy is to operate. It is not that an order cannot relate to areas inside and outside of the radius. It is also not that the order must be a result solely of circumstances inside the radius. It is that the circumstances inside the radius must be a cause of the order, even if circumstances outside of the radius are also a cause of the order (see further below) and the relevant cause in this case is not the risk or threat of COVID-19 but the fact of an outbreak or likely occurrence of COVID-19 as specified. In the present case no inference can be drawn that the circumstances inside the radius were a cause of the order in any sense. Accordingly, the submission for LCA Marrickville that the "parties cannot reasonably be supposed to have intended that risks to life outside the particular radius could be set up so as to displace coverage" goes nowhere. Coverage only exists if the order with the requisite causal connection to the area within the radius exists. If it does, the fact that there may also be a causal connection to areas outside of the radius would not "displace coverage". In the present case, however, the requisite causal connection (as a result of) cannot be identified.
285 The insureds relied on FCA v Arch in respect of the meaning of "outbreak". Swiss Re submitted that an "outbreak" in the context of disease involves a sudden eruption, breaking out or an outburst of that disease and that a single instance of disease, or multiple instances with no connection to a common cause, does not constitute an "outbreak" within the ordinary meaning of the word. In FCA v Arch UKSC Lords Hamblen and Leggatt JJSC, with whom Lord Reed PSC agreed said at [69]:
Nor for that matter could an outbreak of disease be regarded as one occurrence, unless the individual cases of disease described as an outbreak have a sufficient degree of unity in relation to time, locality and cause.
286 This was said in the context of a policy which referred to an "occurrence" and not an "outbreak" of disease.
287 In the present case there is a textual indicator that "outbreak" in cl 9.1.2.1 takes the same meaning as "occurrence". The order must result from either an "outbreak" of disease or the discovery of an organism likely to result in an "occurrence" of disease (at the Situation etc). There is no rational reason, in this context, to distinguish between the two circumstances. In fact, it would be irrational for there to be cover for an order resulting from discovering an organism likely to result in an occurrence of the notifiable disease at the Situation or within the radius and no cover for an order resulting from an actual occurrence of the notifiable disease at the Situation or within the radius merely because the occurrence does not have a sufficient degree of unity in relation to time, locality and cause to be classed as an "outbreak". The inference to be drawn is that cl 9.1.2.1 is treating "outbreak" as synonymous with "occurrence". An occurrence of a notifiable disease is an "event" of such a disease being "something which happens at a particular time, at a particular place, in a particular way": Axa Reinsurance (UK) plc v Field [1996] 1 WLR 1026 at 1035.
288 Even if this incorrect, I do not accept that the reasoning in FCA v Arch UKSC at [69] is applicable. The issue in cl 9.1.2.1 is not whether there was in fact an outbreak of a disease as required. It is whether the authority made the order(s) as a result of what it considered to be an outbreak of the disease. I would infer that the Minister made the orders as a result of what he perceived to be an outbreak or outbreaks of COVID-19 in certain locations in NSW and the associated risk of COVID-19 across NSW. I reach this inference based on these circumstances: (a) the orders apply to the whole of NSW indicating that the Minister perceived a serious risk to human health, (b) it should be inferred that the Minister knew about the agreed facts relating to COVID-19 set out in section 2 above, (c) as such, it should be inferred that the Minister knew both that COVID-19 is highly contagious in a non-controlled environment (that is, not in a hospital, quarantine or isolation) and that people were likely to be infectious with COVID-19 before they became aware of symptoms, and (d) accordingly, the risk to public health was not from known cases of COVID-19 alone but was also from unknown cases of COVID-19.
289 These facts about COVID-19 mean that it is unlikely the Minister acted as he did because of a mere "occurrence" as opposed to an "outbreak" of COVID-19.
290 But for the textual indicator in cl 9.1.2.1, however, I would accept that there is a difference between an "outbreak" of COVID-19 and an "occurrence of COVID-19.
291 Absent the specific context of cl 9.1.2.1, an "occurrence" of COVID-19 would mean an event or case of COVID-19 in any setting. That is, it would not matter if the case of COVID-19 was in a controlled environment (such as a hospital, quarantine or isolation). The fact that the risk of transmission of COVID-19 would be low due to the controlled setting would be immaterial.
292 Absent the specific context of cl 9.1.2.1, an "outbreak" of COVID-19 would require more than an "occurrence" of COVID-19. The difference between my conclusions and the submissions of the insurers is that the insurers contended that an "outbreak" of COVID-19 requires a confirmed case of transmission in the community (that is, in a non-controlled setting) of COVID-19. I consider that an "outbreak" of COVID-19 requires only a case of active (that is, infectious) COVID-19 in the community (that is, in a non-controlled setting).
293 I reach my conclusion on the basis of the same facts identified above, namely: (a) COVID-19 is highly contagious in a non-controlled environment (that is, not in a hospital, quarantine or isolation), (b) people are likely to be infectious with COVID-19 before they become aware of symptoms, and (c) accordingly, the risk to public health was not from known cases of COVID-19 alone but was also from unknown cases of COVID-19.
294 In other words, with a known highly contagious disease like COVID-19 the risk of transmission by a person with active COVID-19 in the community (that is, in the non-controlled setting) is so high that it may readily be inferred that, in any such case, the person probably had transmitted COVID-19 to persons unknown before the person realised they had COVID-19. On this basis, proof of the fact of a person with active COVID-19 in the community (that is, in the non-controlled setting) is sufficient to prove an "outbreak" of COVID-19. The approach of the insurers involves ignoring the probability that a person with active COVID-19 in a non-controlled setting will transmit the disease to other persons who are not able to be identified. In the context of a contractual arrangement I would not infer that the parties to the policy intended that anything more than probabilistic reasoning would be required.
295 This also reflects my view that the parties must be taken to have intended that whether or not there is an "outbreak" is disease dependent. COVID-19 is one kind of disease, as described above. For other diseases, a confirmed case in a non-controlled setting may not be an "outbreak" of the disease.
296 I note that in Hyper Trust No 1 at [143] McDonald J said:
…"outbreak" is capable of consisting of a relatively small number of cases or, where the pathogen is particularly serious, a single instance of disease.
297 As discussed, for COVID-19, I agree.
298 I also consider that it would be unreasonable and uncommercial to confine the meaning of "outbreak" to a confirmed case of community transmission from one person to another person within the area. Because I consider "outbreak" to be disease dependent, I cannot see how it could be concluded that an action of an authority would not result from an outbreak of COVID-19 merely because the authority knew of a person within the community and in the area (and not in a controlled environment) with an infectious case of COVID-19, but did not know the person had in fact infected another person with COVID-19 in the area. The idea that only an action of an authority taken after the authority knows of community transmission of COVID-19 in the area is the result of an outbreak of COVID-19 is untenable given the highly infectious nature of the disease and the obvious risk of unknown cases of COVID-19. The authority must consider the capacity for community transmission in the area to be present, but not necessarily the fact of community transmission, for there to be an outbreak of COVID-19.
299 I would reach the same conclusion if the issue of an "outbreak", under the policy was a matter for me to determine as an issue of objective fact (in contrast to a question whether the action of the authority was a result of an outbreak). In the case of a disease as contagious and potentially serious as COVID-19, the presence of a person within the community and in the area (and not in a controlled environment) with an infectious case of COVID-19 is an outbreak of COVID-19. It is an outbreak of COVID-19 because, unless the person is in a controlled environment, the disease is so readily transmissible and potentially serious. This is not to convert a potential "outbreak" into an "outbreak". It is to recognise that for a disease such as COVID-19 one active case in an uncontrolled setting is itself an "outbreak" of COVID-19.
300 This conclusion, I note, is consistent with the position of the Australian Government Department of Health CDNA (Communicable Diseases Network Australia) National Health Guidelines for Public Health Units which outlines minimum standards for the surveillance, contact-testing and management of COVID-19. The document defines an outbreak of COVID-19 as a single confirmed case of COVID-19 in the community. While the document was issued in May 2021, well after the events in question, it discloses that there is (and, by inference, was at the relevant time) a rational basis for an authority to consider that a single case of COVID-19 within the community constitutes an outbreak of COVID-19, provided that case is infectious while in the community. In terms of a clause depending on the actions of an authority, rationality of the action is sufficient.
301 As the insureds said, this makes sense given the following: (a) COVID-19 is a new and deadly virus that was not known to exist in humans before 2019, (b) the severity and virulence of COVID-19, (c) at the relevant times there was no vaccine or cure for COVID-19, and (d) the previously expected number of cases of COVID-19 would have been zero.
302 I recognise that the issue involve an inference about or attribution to an authority of a reason for acting. It is not possible to know whether the authority subjectively characterised the circumstances as an "outbreak" or an "occurrence" of COVID-19. This supports the conclusion that a commercially rational interpretation of the policy involves focusing on the action of the authority and a process of drawing inferences from that action and circumstances known to the authority at the time about the reasons for its actions as a matter of objectively inferred or objectively attributed fact.
303 This said, I agree that if the focus of the clause was the objective fact of an outbreak of COVID-19 then: (a) as noted, one case of COVID-19 in controlled circumstances such as quarantine, isolation or a hospital would not be an outbreak of COVID-19, and (b) as a practical matter, proving an outbreak of COVID-19 within the radius requires a person with COVID-19 capable of communicating COVID-19 to be present within the radius other than in a controlled situation such as quarantine.
304 It is not relevant, however, that guidelines about other diseases (Commonwealth Department of Health's 'Guidelines for the public health management of gastroenteritis outbreaks due to norovirus or suspected viral agents', last updated in 2010) require "[t]wo or more cases of diarrhoea and/or vomiting in a 24 hour period in an institution or among a group of people who shared a common exposure or food source should be suspected as constituting an outbreak and an assessment or investigation commenced". This is a different disease and what constitutes an outbreak, in my view, is disease dependent.
305 LCA Marrickville submitted that, on the agreed facts:
…there were at least 19 COVID-cases as at 23 March 2020 that recorded postcodes wholly within the radius. There were 132 cases recorded in LGA's partly within the radius, and the Court can safely infer that it is more probable than not that at least some of those cases were within the radius. As is conceded by Swiss Re, at least 9 of the infections wholly within the radius had a likely source of infection within Australia. This is plainly sufficient, in the context of a disease of the characteristics, seriousness and virulence as COVID-19, to constitute an "outbreak" at that time and within the radius.
306 As I have said, in the context of actions of an authority, whether or not the cases of COVID-19 were the result of transmission within the 5 kilometre radius is sufficient but not necessary insofar as the requirement for an "outbreak" is concerned. Having COVID-19 and being infectious in non-controlled circumstances within the 5 kilometre radius is what is necessary because that fact alone proves the probability of transmission to other persons even if those other persons are not known or the fact of such transmission cannot be proved. An "outbreak" is not confined to cases of COVID-19 within the radius springing from one common source or multiple sources within the radius. It is the presence of a person with COVID-19 capable of being transmitted to another person who is not in a controlled situation such as quarantine, isolation or a hospital and who is within the radius that is required. I thus reject the submission of Swiss Re that there must be a unity of time, location and cause, in effect, involving multiple contemporaneous transmissions from a cause originating at, and between persons located at the Situation or within the radius at the time of transmission.
307 I note that the evidence discloses that by 23 March 2020 there were 832 cases of COVID-19 in NSW. As noted, of those total cases, 132 cases had a usual place of residence in a local government area partly within the 5 kilometre radius of the Situation and 19 had a usual place of residence in a postcode within the 5 kilometre radius of the Situation.
308 The issues, however, are that: (a) there is no evidence from which it would be inferred that the evidence of persons with COVID-19 within the radius had anything to do with the making of the orders, and (b) if this is wrong, the available evidence discloses only the usual place of residence of the person with COVID-19 and not that the person was within the radius when infectious with COVID-19 or was within the community (as opposed to being in controlled circumstances such as a hospital, in isolation or in quarantine).
309 Swiss Re submitted that the evidence does not "establish where a person was during their infectious period, or at any time, when that person had COVID-19 - i.e., whether the person was in hotel quarantine, hospital quarantine, wholly compliant with directions to quarantine at home or in the community and if so, for what periods and at what locations". This is true. But the evidence does establish that nine cases were "locally acquired" as opposed to "overseas". I infer this means those nine cases were acquired within Australia. I accept that I do not know that any one of these nine people were within the radius while they were capable of transmitting COVID-19 to another person. I also accept that I am unable to draw this inference as LCA Marrickville proposed, based on the available evidence.
310 For there to be an outbreak of COVID-19 within the radius there would need to be evidence of a person with COVID-19 in an non-controlled setting and capable of transmitting COVID-19 within the radius. There is no such evidence and no evidence capable of supporting a rational inference to this effect.
311 LCA Marrickville contended that this cannot be correct as it is too difficult to prove and the policy should be given a reasonable commercial operation. The problems with this submission are that, first, it supports the primary "textual" approach to determining whether the action of an authority resulted from the identified matter as discussed above (with which I agree) and, secondly, that it assumes cl 9.1.2.1 applies to: (a) a nationwide pandemic which is the very kind of disease most likely to be excluded by the biosecurity exclusion, and (b) an order which applies to the whole of NSW in response to a pandemic rather than an order resulting from an outbreak of a notifiable disease within the radius (whether or not it started within the radius or spread from elsewhere into the radius).
312 I do not repeat this level of detail below when dealing with the concept of an "outbreak" of COVID-19 in the context of other polices, but it forms part of my process of reasoning in each relevant case.
313 The alternative requirement is the discovery of an organism likely to result in the "occurrence" of a notifiable human infectious or contagious disease at the Situation or within the radius. There is no dispute that SARS-CoV-2, the cause of COVID-19, is an organism. As noted, I do not consider that the organism itself must be discovered at the Situation or within the radius. It must be discovered at a location so as to make it likely to result in the occurrence of a notifiable human infectious or contagious disease at the Situation or within the radius.
314 LCA Marrickville accepted that in this context "likely" means more likely than not or probable. On this basis, the evidence must enable an inference of likelihood of an occurrence of COVID-19 at the Situation or within the 5 kilometre radius. For this inference to be drawn there must be evidence of the order resulting from a person with COVID-19 and capable of communicating the disease at the Situation or within the 5 kilometre radius. There is no such evidence. I do not accept, however, that "this limb is not established merely by the 'discovery' of a person infected with COVID-19 having been present either at the 'Situation' or within the Radius", as Swiss Re would have it, provided that the person with COVID-19 is capable of communicating the disease to others (that is, they are still contagious).
315 As discussed, however, all of the above is theory only because the requirement is that the order of the authority result from either an outbreak of a notifiable human infectious or contagious disease at the Situation or within the radius or any discovery of an organism likely to result in the occurrence of a notifiable human infectious or contagious disease at the Situation or within the radius. As noted, this is not proved by evidence of person(s) with COVID-19 at the Situation or within the radius or in the vicinity of the radius. It is proved by evidence of the reasons for the authority making the order. This is best proved by the terms of the order for the reasons already given. In the present case, by necessary implication, the orders disclose that they were not made as a result of an outbreak or occurrence of COVID-19 at the Situation or within the radius or in the vicinity of the radius. I do not see how further evidence, expert or otherwise, can alter that position.