TITLE OF COURT: SUPREME COURT OF TASMANIA (FULL COURT)

Torts - Negligence - Essentials of action for negligence - Duty - Breach of duty - Damage - Sexual abuse - Indecent assault suffered during childhood - When damage arose - Repressed memory - Recognisable psychiatric illness - Nervous shock or mental disorder - Onset of post-traumatic stress disorder - Time when psychiatric injury suffered.

Limitation of Actions - Contracts, torts and personal actions - Personal injury cases - Extension of the bar - Accrual of cause of action - When injury suffered - Repressed memory - Time began when psychiatric injury suffered.

Limitation Act 1974 (Tas), ss4(1), 5(1).

Williams v Milotin [1957] HCA 83; (1957) 97 CLR 465, distinguished.

Hawkins v Clayton (1988) 164 CLR 539; Gray v Motor Accident Commission (1998) 158 ALR 485; Mount Isa Mines Ltd v Pusey [1970] HCA 60; (1970) 125 CLR 383; Jaensch v Coffey (1983 - [1984] HCA 52; 1984) 155 CLR 549; Rankine v Garton Sons &Co Ltd [1979] 2 All ER 1185, applied.

Kruber v Grzesiak [1963] VicRp 84; [1963] VR 621; Letang v Cooper [1964] EWCA Civ 5; [1965] 1 QB 232; Hinz v Berry [1970] 2 QB 40; Behrens v Bertram Mills Circus Ltd, [1957] 1 ER 583; Cowell v Corrective Services Commission (1988) 13 NSWLR 714; Donoghue v Stevenson [1932] AC 562; Carroll v Folpp, unreported, Supreme Court of New South Wales 10/2/1998; Elliott v Barnes (1951) 51 SR(NSW) 179; Cartledge and Others v E Jopling & Sons Ltd [1963] AC 758; Pirelli General Cable Works Ltd v Oscar Faber & Partners (a firm) [1983] 1 All ER 65; Pullen v Gutteridge Haskins & Davey Pty Ltd [1993] VicRp 4; [1993] 1 VR 27; Tsanaktsidis v Oulianoff (1980) 24 SASR 500; Coates and Another v Government Insurance Office of New South Wales (1995) 36 NSWLR 1; S v G [1995] 3 NZLR 681, consdiered.

Appellant/Defendant: S P Estcourt and J P E Walker

Judgment ID Number: [1999] TASSC 33

GRAEME JAMES GREGORY WILSON v CHERIE JAYNE HORNE

GRAEME JAMES GREGORY WILSON v CHERIE JAYNE HORNE

1 The respondent/plaintiff began proceedings against the appellant/defendant by filing a writ on 23 May 1996. While the writ claimed damages for negligence, assault, battery and breach of fiduciary duty, the statement of claim confined the respondent's claim to damages for negligence.

2 The respondent's case against the appellant was that between 1973 and 1980, when she was aged between 5 and 12 years, the latter, who was her uncle and 25 years her senior, subjected her repeatedly to sexual abuse amounting to the crime of indecent assault. At the time she did not appreciate the wrongfulness of this conduct, which the appellant discouraged her from revealing to others on the pretext that it was a special secret between them. It was only in 1994 that the memories of this conduct, which she had hitherto repressed, were revived in her consciousness by the revelation made to her by one of her sisters that she, too, had suffered similar treatment at the hands of the appellant. The respondent then sought counselling and, as further memories came to light, she developed symptoms of chronic Post-Traumatic Stress Disorder. There was evidence that prior to this time she did not suffer any psychiatric illness and the abuse itself did not involve penetration, nor was it accompanied by any physical injury.

3 The learned trial judge over-ruled a submission of no case to answer made on behalf of the appellant, whose counsel had argued that where there is a direct and intentional act and an injury was intended or must have been adverted to, trespass is the only cause of action open to a plaintiff. The appellant pleaded in its defence that the respondent's claim (sic) was out of time and barred by virtue of the Limitation Act 1974. Pressed for particulars, the appellant sought to rely on the Limitation Act, ss4 and 5. The submission having been over-ruled, the appellant chose not to give or adduce any evidence and the learned trial judge found that the respondent had made out a case against the appellant in negligence and awarded damages, including exemplary damages.

4 The appellant's first two grounds of appeal are as follows:

"1 The learned trial judge erred in law in ruling that the evidence given and adduced by the plaintiff gave rise to a cause of action in negligence.

2 The learned trial judge erred in law in failing to rule that the only cause of action open to the plaintiff on the evidence she gave and adduced was a cause of action in trespass which was barred by the provisions of the Limitation Act 1974 at the date that the plaintiff brought her action against the defendant."

5 I do not think there can be any doubt that the facts found by the learned trial judge on the evidence adduced gave rise to a cause of action in negligence. Other grounds of appeal challenge his finding that such an action was not, in the circumstance of this case, statute barred because actionable damage consequent upon such negligence did not arise until a time within the three years preceding the issue of the writ and I shall return to that aspect of the case. However, there was ample evidence justifying the finding that a duty of care existed on the part of the appellant toward his niece of tender years, in the circumstances of her regularly visiting his home where he lived with his parents, who were her grandparents. The learned trial judge noted:

"There is no doubt that the defendant owed the plaintiff a duty of care to take reasonable steps not to expose her to the risk of reasonably foreseeable injury and there is equally no doubt that by treating her as he did the defendant was in breach of that duty. Senior counsel for the defendant did not submit to the contrary."

The way the appellant treated the respondent consisted of repeated sexual abuse which clearly caused damage. I share his Honour's satisfaction that a case in negligence was made out.

6 The gravamen of the argument in support of the grounds I have mentioned is the proposition that acts amounting to intentional trespass cannot be pleaded as negligence and only an action for trespass may be brought. Reliance was placed on obiter in the High Court's decision in Williams v Milotin [1957] HCA 83; (1957) 97 CLR 465 at 470 where the court said:

"At that time [ie, prior to the passing of the Supreme Court Act 1878 of South Australia, by which the 'judicature system' was adopted] the present action might have been framed as an action of trespass. For it seems that the facts which the plaintiff, by his next friend, intends to allege are that he was immediately or directly hit by the motor car driven by the defendant as a result of the negligence of the defendant himself. There is no suggestion that the defendant intended to strike him. If that had been the allegation the action could have been brought in trespass and not otherwise. But as only the negligence of the defendant is relied upon, while the cause of action might have been laid as trespass to the person, the action might also have been brought as an action on the case to recover special or particular damage caused by the defendant's negligence. Had the damage been caused indirectly or mediately by the defendant or by his servant (a state of things to be distinguished from violence immediately caused by the defendant's own act) the action must have been brought as an action on the case and not otherwise." (My emphasis.)

7 In my view, that case is not authority for the proposition relied upon by the plaintiff, but establishes that prior to the introduction of the judicature system, a direct and intentional application of force only gave rise to an action for trespass. A recent example of conduct involving an intentional trespass to the plaintiff's person but pleaded in negligence is Gray v Motor Accident Commission (1998) 158 ALR 485. There the plaintiff was struck by a car intentionally driven at him by the tortfeasor, who was also convicted of, and punished for, causing grievous bodily harm with intent to cause such harm to the plaintiff. In the joint judgment of Gleeson CJ, McHugh, Gummow and Hayne JJ, their Honours asked:

"If, as we have earlier suggested, the remedy is exceptional in the sense that it arises (chiefly, if not exclusively) in cases of conscious wrongdoing in contumelious disregard of the plaintiff's rights ... are exemplary damages available where the plaintiff's claim is for damages for negligence rather than some intentional wrong ... ?" (at 490 - 491)

They went on to hold that exemplary damages could not properly be awarded in a case of alleged negligence in which there was no conscious wrong-doing by the defendant, but that in view of the fact that the tortfeasor had already been substantially punished with imprisonment, an award of exemplary damages ought not to have been made. As, however, compensatory damages were, in the court's view, manifestly inadequate, a new trial was ordered on the issue of damages other than aggravated and exemplary damages. It is implicit in the judgment that the court of first instance had jurisdiction to entertain an action for damages based on negligence as the pleaded cause of action, notwithstanding that the tortfeasor's conduct might also have given rise to a cause of action in trespass.

8 I conclude, therefore, that the mere fact that the circumstances complained of by a plaintiff might fit more than one category of tort and might, on one view, be more appropriately described as trespass rather than negligence, is not sufficient to deprive the court of jurisdiction to entertain an action in the latter form and to grant a remedy therefor, provided all the facts essential to that cause of action can be established. Whether or not the action brought is statute barred depends on the terms of the relevant Statute of Limitations.

9 Kruber v Grzesiak [1963] VicRp 84; [1963] VR 621 was a running down case in which the plaintiff sought leave to amend the statement of claim, which originally pleaded negligence simpliciter, so as to add trespass to the person as a cause of action based on the same facts. Adam J had to construe the Victorian equivalent to the Limitation Act 1974, s5(1) which imposes a basic limitation period of three years from the date on which the cause of action accrues for an:

"... action for damages for negligence, nuisance, or breach of duty (whether that duty exists by virtue of a contract or a provision made by or under an enactment or independently of any contract or any such provision) where the damages claimed by the plaintiff for the negligence, nuisance, or breach of duty consist of or include damages in respect of personal injuries to any person ... ."

"... that the expression 'actions for damages for negligence' - should be construed to include not only actions on the case for negligence, but also actions of trespass to the person in which, because the trespass is not intentional, proof of negligence is an essential ingredient." (at 623)

He went on to hold that the case also fell within the expression "breach of duty". His judgment was cited with approval in Letang v Cooper [1964] EWCA Civ 5; [1965] 1 QB 232 (at 241 and 245).

10 The Limitation Act 1974, s4(1) relevantly provides:

"4 (1) Except as otherwise provided in this Division, the following actions shall not be brought after the expiration of 6 years from the date on which the cause of action accrued, that is to say:

(a) actions ... founded on tort, including actions for damages for a breach of statutory duty;"

I have set out the substance of s5(1), which is in the same Division, and does otherwise provide. It limits the time for bringing an action for damages for (inter alia) negligence and breach of duty where the damages include damages in respect of personal injuries to three years from the date on which the cause of action accrued. Had the respondent's cause of action in negligence accrued at the same time as one brought in trespass, it would seem to follow from Kruber v Grzesiak (supra) that the shorter limitation period of three years would apply, irrespective of which cause of action was relied upon. But that is not the case here, so the learned trial judge found, and if his finding is correct, the cause of action in negligence did not accrue until a time within that period of three years, whereas the cause of action in trespass undoubtedly arose at the time the sexual assaults occurred many years previously. In my opinion, therefore, the learned trial judge had jurisdiction to hear the case as a cause of action in negligence and the relevant limitation provision is s5(1). The remaining grounds of appeal challenge the proposition that this cause of action only accrued in about 1994, so that s5(1) did not operate to bar the remedy.

"3 The Learned trial judge erred in fact and in law in failing to find that the plaintiff had, as a result of the defendant's breach of the duty of care he owed her suffered loss, damage or injury more than three years before the date on which she brought her action against the defendant.

4 The Learned trial judge erred in law in holding to the effect that the plaintiff must have suffered from a recognisable psychiatric illness before it could be said that she had suffered loss, injury or damage sufficient to give rise to the accrual of her cause of action against the defendant in negligence.

5 The learned trial judge erred in law in failing to consider whether the plaintiff's sexual development disorder which he found on the balance of probabilities to have been caused by the defendant's behaviour was damage beyond de minimus sufficient to give rise to the accrual of the plaintiff's cause of action against the defendant in negligence even if it were not a recognisable psychiatric illness."

12 The learned trial judge concluded that the respondent did not suffer injuries for which damages might be awarded in an action for negligence until an identifiable form of psychiatric illness, namely Post-Traumatic Stress Disorder, was diagnosed as having commenced in about 1994. Relevantly he found:

"During her development through to maturity, the plaintiff felt neither anxiety nor guilt about the defendant's sexual behaviour with her. However, she described herself as a promiscuous girl.

The plaintiff said, and I accept, that until she had a conversation with her sister Leanne in about 1994, when her third child was four months old, she gave no thought to the defendant's sexual abuse. The plaintiff said that she had pushed all the details of the defendant's conduct to the back of her mind. Until shortly after this conversation with her sister Leanne, the plaintiff enjoyed her sexual life with her husband, cared well for her children and was generally of good spirits.

[Psychiatrist] Dr Sale described the plaintiff's adolescent sexual behaviour set out earlier in these reasons for judgment, not as an adjustment difficulty, but as a manifestation of a child who has been subjected to sexual abuse. He described the plaintiff's adolescent sexual conduct as a behavioural problem. Dr Sale explained that sexually abused children have a precocious awareness of their own sexuality and often act out with other children behaviour that they have learnt. In this sense, said Dr Sale, the development of such children has been affected by the sexual abuse [or tortious conduct]. Dr Sale said this is the likely, but not necessarily the only, explanation for what might be described as the plaintiff's early precocious sexual behaviour.

Dr Sale declined to describe the plaintiff's adolescent behaviour as an adjustment disorder. He said, and I accept, 'I would have seen her difficulties as a developmental problem, to do with sexual development. I'm not sure what exact words I would use but that would certainly be how I would regard them, as a developmental disorder of sexual development specifically.' Dr Sale's evidence was to the effect that the plaintiff's sexual development in adolescence did not conform to the normal sexual development of an adolescent Australian female child of an equivalent age. He would not categorise this deviation from the norm as a psychiatric illness or disorder. He said that if he had been aware of this behavioural development at the time it was occurring, he would have advised counselling to try and bring the conduct in line with the norm. Upon the history (and the evidence) given, Dr Sale said that the plaintiff's sexual development had caused her to suffer from no symptoms other than the occasional transitory ones of shame and guilt."

13 His Honour concluded that the respondent's action would fail by reason of the Limitation Act 1974, s5(1) if the appellant's breach of the duty of care he owed her caused her to suffer loss, injury or damage prior to 23 May 1993. He referred to Cartledge v E Jopling & Sons [1963] AC 758 and Pirrelli General Cable Works v Oscar Faber & Partners Ltd [1983] 2 AC 1.

"The common law of Australia does not recognise as compensable, transitory emotional upset. Stress and anxiety do not sound in damages unless they reach the stage of an illness."

With respect, I agree. In Hinz v Berry [1970] 2 QB 40, Lord Denning MR used the description "any recognisable psychiatric illness" (at 42); this description was adopted by Windeyer J in Mount Isa Mines Ltd v Pusey [1970] HCA 60; (1970) 125 CLR 383 at 394; Dixon J (as he then was) in Bunyan v Jordan (1936 - [1937] HCA 5; 1937) 57 CLR 1 at 16 spoke of the relevant compensable condition as a "neurasthenic breakdown amounting to an illness"; and in Jaensch v Coffey (1983 - [1984] HCA 52; 1984) 155 CLR 549, Brennan J (as he then was), referring to the above cases, again stressed the need for a plaintiff to establish the existence of a psychiatric illness. That is not to say that emotional upsets of varying kinds not amounting to illness or disorder may not be compensated in awards of damages for pain and suffering where physical injury has been caused by the defendant's negligent act (see Liability for Negligently Inflicted Nervous Shock by Harvey Teff (1983) 99 LQR 100). In this case, however, there was no evidence of physical injury.

15 In my opinion, the learned trial judge was correct in holding that the aberrant sexual development of the respondent fell short of illness or disorder and was not therefore compensable in an action for negligence. Compensable damage only came into existence after 1993 when the symptoms observed and diagnosed as Post-Traumatic Stress Disorder manifested themselves.

16 Counsel for the respondent advanced an interesting alternative basis for upholding the judgment should the appeal succeed on grounds 3, 4 and 5. Indeed, it would be equally applicable should the appellant succeed on the first two grounds. It was to the effect that as the appellant's conduct induced a state of affairs which effectively prevented the respondent from instituting proceedings until her memories were revived by discussions with her sister in 1994, the cause of action only accrued then. He relied on the following statement of Deane J in Hawkins v Clayton (1988) 164 CLR 539 at 590:

"If a wrongful action or breach of duty by one person not only causes unlawful injury to another but, while its effect remains, effectively precludes that other from bringing proceedings to recover the damage to which he is entitled, that other person is doubly injured. There can be no acceptable or even sensible justification of a law which provides that to sustain the second injury will preclude recovery of damages for the first. It would, eg, be a travesty of justice and common sense if the law provided that a cause of action lay for damages for false imprisonment but then went on to provide that that cause of action would be lost if the false imprisonment continued for six years after the cause of action first accrued. Likewise, it would be a travesty of justice and common sense if the law imposed a duty upon a solicitor to take positive steps to inform a third person of the contents of a document of which the solicitor was alone aware and then provided that any cause of action against the solicitor for damage caused by a negligent failure to perform that duty would be lost if the negligence continued for six years. It is arguable that the notion of unconscionable reliance upon the provisions of a Statute of Limitations which provides the foundation of the long-established equitable jurisdiction to grant relief in a case of concealment of a cause of action until after the limitation period has expired (cf s55(1) of the Limitation Act) should, by analogy, be extended to cover cases such as these where the wrongful act at the one time inflicts the injury and, while its effect remains, precludes the bringing of an action for damages. It seems to me, however, that the preferable approach is to recognize that it could not have been the legislative intent that the effect of provisions such as s14(1) of the Limitation Act should be that a cause of action for a wrongful act should be barred by lapse of time during a period in which the wrongful act itself effectively precluded the bringing of proceedings. On that approach, the reference in s14(1) of the Act to the cause of action first accruing should be construed as excluding any period during which the wrongful act itself effectively precluded the institution of proceedings."

In the present case there was evidence that the appellant persuaded the respondent not to reveal his assaults upon her and that her natural defence mechanism to his wrongful behaviour involved repression and suppression of her memories of it. In these circumstances it was submitted that his own wrongful conduct effectively precluded the respondent from commencing any action against him. In consequence, both causes of action, namely trespass and negligence, only accrued when disclosure was made and the repressed memories were released. There is, with respect, much to be said for this contention but it was an issue requiring findings of fact which were not specifically addressed on trial and as the appeal fails on the grounds raised by the appellant, it is unnecessary to express a firm conclusion in respect of it.

GRAEME JAMES GREGORY WILSON v CHERIE JAYNE HORNE

18 The plaintiff (respondent) was born on 12 April 1968 and was sexually abused by the defendant (appellant), her uncle, between the ages of 5 and 12. The plaintiff says that she did not realise this conduct was wrong at the time and repressed her memory of it until 1994 when a particular event caused the memories to flood back. Thereafter, she developed what an expert witness, Dr Sale, described as chronic Post-Traumatic Stress Disorder of delayed onset. Dr Sale said that the plaintiff did not suffer any psychiatric illness before 1994. Dr Sale conceded that adolescent promiscuity and other behavioural problems manifested by the plaintiff at about that time may have been a consequence of her sexual abuse and could be described as a sexual developmental disorder.

19 The plaintiff issued a writ suing the defendant in trespass and, alternatively, in negligence. No doubt realising that trespass is actionable per se without proof of either actual injury or damage (Cowell v Corrective Services Commission (1988) 13 NSWLR 714 at 743) she elected to proceed in negligence only. Her action in trespass accrued in 1980 and was clearly statute barred when the writ was issued. Negligence is actionable upon proof of duty, breach of duty and damage. It is not actionable in the absence of damage. Consequently, if damage does not occur until some time after breach of duty, the cause of action does not accrue until that time (Rankine v Garton Sons & Co Ltd [1979] 2 All ER 1185 at 1190). The plaintiff says that damage did not accrue from the defendant's tortious conduct until the triggering event in 1994 and that accordingly, her action in negligence was not statute barred at the time she commenced proceedings on 23 May 1996, notwithstanding the fact that the defendant's tortious conduct had concluded by 1980.

20 The defendant contends that because the plaintiff's entitlement to sue in trespass crystallised in 1980, her rights of action are all statute barred as she cannot sue in negligence if she could have sued in trespass. It was submitted that this proposition is supported by the statement of a unanimous High Court in Williams v Milotin [1957] HCA 83; (1957) 97 CLR 465 at 470:

"At that time the present action might have been framed as an action of trespass. For it seems that the facts which the plaintiff, by his next friend, intends to allege are that he was immediately or directly hit by the motor car driven by the defendant as a result of the negligence of the defendant himself. There is no suggestion that the defendant intended to strike him. If that had been the allegation the action could have been brought in trespass and not otherwise. But as only the negligence of the defendant is relied upon, while the cause of action might have been laid as trespass to the person, the action might also have been brought as an action on the case to recover special or particular damage caused by the defendant's negligence. Had the damage been caused indirectly or mediately by the defendant or by his servant (a state of things to be distinguished from violence immediately caused by the defendant's own act) the action must have been brought as an action on the case and not otherwise." [My emphasis.]

21 In my opinion, if correctly understood, this statement does not conclude the issue in the defendant's favour. The Court's observations that "the action could have been brought in trespass and not otherwise" are obiter dicta but, of course, they are nonetheless entitled to the greatest respect. However, in the passage cited, the Court's purpose was to distinguish clearly between the ingredients of an action for trespass on the one hand and an action for negligence on the other. The italicised words were unnecessary for this purpose and were not supported by the preceding discussion or authorities subsequently cited. In any event, on the basis of the facts predicated, the words of the High Court were not necessarily incorrect. In the absence of an allegation of damage, the plaintiff could not have sued in negligence, and the predicated facts contain no reference to such an allegation. A misunderstanding of the sentence containing the italicised words may readily follow if this is not understood. The effect of the judgment in Williams v Milotin (supra) was usefully summarised by Morling CJ in Parsons v Partridge (1992) 111 ALR 257 at 259 - 260. His Honour had no difficulty in rejecting an argument similar to that urged upon us by the defendant in the present proceedings: He said:

"In Williams v Milotin [1957] HCA 83; (1957) 97 CLR 465 a plaintiff brought an action to recover damages for personal injuries sustained by him in consequence of being struck by a motor truck being driven by the defendant in a negligent manner. The action was commenced more than three years but less than six years after the date of the accident. It was unanimously held that the action formerly might have been brought in the form of action called action on the case and would formerly have been correctly brought in the form of action called trespass on the case.

It was further held that on the facts of the case the cause of action might also have been laid as trespass to the person. The court further held that on true construction of s 35 of the Limitation of Action Act the words "save actions as otherwise provided in this Act" did not operate to bar causes of action falling within s 35 of the Act brought within six years because the same facts would also support a cause of action falling within s 36. Accordingly, since the plaintiff had elected to rely on a cause of action falling within s 35 the period of limitation applicable was six years.

In my opinion the decision in Williams v Milotin deprives the decision in Hillier v Leitch of any support it might otherwise have afforded for the applicants' argument in the present case. It follows from the decision in Williams v Milotin that on the facts alleged in the present case the action might formerly have been correctly brought in the form of an action called trespass on the case. It might also have been brought in the form of an action for trespass to the person. Just as the plaintiff in Williams v Milotin elected to rely on a cause of action falling within s 35 of the Limitation of Action Act 1936 (SA) which provided for a period of limitation of six years, so the plaintiffs in the present proceedings have elected to rely upon a cause of action falling within that part of s 111 of the Limitation Act 1623 which refers to causes of action in respect of which the limitation period is six years. Having so elected, the limitation period applicable in the present case is six years, not four as contended on behalf of the defendant."

22 I am in no doubt that the plaintiff is entitled to pursue whichever cause of action she prefers. If, as appears to have been conceded by her election to abandon trespass, that cause of action would be statute barred, she can proceed in negligence. Whether she can succeed in that cause of action depends only upon her ability to establish the essential ingredients of that cause of action and her ability to surmount the issues raised by grounds 3, 4 and 5 of the notice of appeal.

23 If the plaintiff suffered injury or loss before 23 May 1993, her action for negligence would fail as a result of the Limitation Act 1974, s5(1) (Cartledge v E Jopling & Sons Ltd [1963] AC 758). The learned trial judge held that the onus of proving the existence of compensable injury or loss prior to 23 May 1993 lay upon the defendant. The notice of appeal does not challenge this as a proposition of law but contends that on the basis of the evidence given at the trial, a finding should have been made that the plaintiff suffered the relevant personal injury before that date. It is also contended that such a finding is neither negatived nor imperilled by a finding that she did not suffer a "recognisable psychiatric illness" before that date. It was submitted that there was clear evidence of "damage" to the plaintiff's development, personality and character before May 1993, and it was submitted further that such damage should be regarded as amounting to compensable injury, sufficient to sustain the action.

24 In my opinion to call such phenomena "damage" or "injury" as those terms are used to define one of the necessary concomitants of the tort of negligence, is to beg the question, and the validity of the defendant's submission must depend upon the extent to which such features as those relied on have been recognised as giving rise to compensable claims.

25 A claim for pain and suffering in an action for damages may include a component for mental anguish or worry, falling well short of mental shock, but in such cases, the basis for the claim is the physical damage or injury which sustains the claim. The mental anguish or worry does not provide a "stand alone" element of the cause of action.

26 It occurred to me that the discussion of principle which has taken place in the "nervous shock" cases to which reference was made by both parties during argument, may not be determinative of the issue which the defendant has raised for consideration by this Court. Perhaps the "nervous shock" cases have not been concerned with the occurrence of recognisable injury or damage of a kind which would entitle a person directly and immediately subjected to tortious conduct to sue, but rather with the question of the scope and extent of the tortfeasor's liability to third parties affected thereby, ie, remoteness of damage. Perhaps it is one thing to say that a person may not recover damages for distress or grief occasioned by observation of tortiously caused harm to a third party, and may only recover for proved nervous shock, but something very different to say that a person directly and immediately affected by tortious conduct cannot recover for distress or grief and must prove nervous shock or physical injury before being entitled to recover. However, these suggested distinctions do not stand scrutiny and it may be said with confidence that whether the claimant is the victim of the tortious behaviour or merely a third party observing or learning of injury to the victim, the minimum damage or injury sufficient to sustain an action will be "nervous shock".

27 Munkman's Damages for Personal Injuries (1970) 4th edn at 111 said:

"In fact, nervous shock of the kind we are speaking of is physical injury, though not of an obvious kind. It is a disturbance of the nervous system, and through the nervous system it affects the glands and chemical controls of the body, producing well-recognised symptoms. Damages cannot be recovered for mental distress alone, if it is no more than grief or painful and unhappy thoughts: Behrens v Bertram Mills Circus Ltd, [1957] 1 ER 583 at p 596; [1957] 2 QB 1, at p 28. (But mental distress can of course be taken into account as part of the pain and suffering for a physical injury.)"

28 Behrens v Bertram Mills Circus Ltd (supra) involved a claim by two circus performers whose booth was damaged by rampaging elephants. At 27 - 28, Devlin J (as he then was) said:

"An elephant coming over the top of a booth would be a terrifying thing even for an ordinary man, and although the male plaintiff asserts that he was not frightened, I am satisfied that the shock must have been considerable. I should like to award him a substantial sum under this head, but I am satisfied that I cannot do so except to the extremely limited extent that the shock resulted in physical or mental harm. I think that that is clearly the effect of the authorities. When the word 'shock' is used in them, it is not in the sense of a mental reaction but in a medical sense as the equivalent of nervous shock; MacKinnon LJ in Owens v Liverpool Corporation [1939] 1 KB 394, 400; 55 TLR 246; [1938] 4 All ER 727 refers to it as being 'ascertainable by "the physician"' and as 'the form of ill-health which is known as "shock".' I appreciate that it is now becoming increasingly difficult to define the boundaries of mental ill-health. But without infringing the general principle embedded in the common law that mental suffering caused by grief, fear, anguish and the like is not assessable, Owens v Liverpool Corporation goes as far as any court can go and I cannot accept Mr Brown's invitation to attempt an extension of what is there said."

29 More recently in Coates v GIO of NSW (1995) 36 NSWLR at 4, Gleeson CJ observed:

"There is no clear line between severe but natural grief, on the one hand, and 'nervous shock' on the other. Many people become physically ill in reaction to grief. Many people grieve for a deceased relative or friend for an extended period. This does not mean that such people are suffering from psychiatric illness or injury."

30 Professor Fleming in his most recent and, regrettably, last edition of The Law of Torts (9th - 1998) says this at 173 - 174:

The pronounced caution towards claims for injury to the nervous system is founded on two, far from negligible, considerations. First is the fear that to treat psychiatric injury on the same wide lines as external injuries from physical impact would open up 'a wide field for imaginary claims'. There used to be, though now waning, scepticism in judicial minds concerning the degree of reliance which can safely be placed on medical diagnosis both as to the existence of such trauma and its causal connection with the defendant's conduct. Mental injury is more easily simulated than external injury, and exposure of counterfeit claims rendered difficult by the time lag between accident and trial. This apprehension goes far to explain why the courts soon modified their opposition to nervous shock as a head of 'parasitic damages', consequential to some other tort, like bodily injury from actual impact. It also makes intelligible their categorical refusal to permit recovery for mental suffering, unaccompanied by objective and substantially harmful physical or psychopathological consequences: mere fright, anguish or grief is deemed too trivial, evanescent or easily faked unless it either accompanies some external injury (when it will readily qualify as but another of the scrambled strands composing the conventional item of 'pain and suffering') or constitutes a causal link with some later external injury, as when alarm impels the plaintiff to jump off a high platform. Otherwise emotional shock must amount to 'physical injury' or, more precisely, it must have resulted in some organic damage, like miscarriage, coronary thrombosis or stroke, or in severe psychiatric injury like hysteria or anxiety neurosis (particularly 'post-traumatic stress disorder' - PTSD). There must be a sudden assault on the nervous system (hence the traditional reference to 'nervous shock', not just an accumulation of stress or grief).

The second factor militating against claims for psychiatric injury is the fear that an unduly onerous burden would be placed on human activity, if liability were indiscriminately imposed for failure to adjust one's conduct to the risk of inadvertently exposing others to shock, particularly when the victim was not apprehending injury to himself but to someone else. Foreseeability of physical trauma (impact) imports spatial and temporal limitations lacking in the case of psychiatric injury.

At first, the objection against all recovery for nervous shock unaccompanied by actual impact was assigned to the ground that the damage was 'too remote', a consequence which 'in the ordinary course of things would not flow from the negligence'. This explanation was scarcely convincing, because it could not really account for a categorical denial of recovery, regardless of the probabilities and risks involved in a particular situation. A second string to the same bow was the crude view that trauma to the nervous system sustained through the eye or the ear without external impact could not, in the nature of things, qualify as 'physical injury'. Gradually however, this assumption yielded to increasing pathological knowledge that there was no real scientific distinction between mental disturbance and bodily injury, and that psychiatric injury, in contrast perhaps to mere anguish, resulting from shock must be recognised as physical injury."

This lucid and convincing exposition obviously provides a clear rebuff to the tentative arguments advanced above and, in my opinion, defeats the propositions advanced by the defendant in support of grounds 3, 4 and 5 of the appeal.

31 I am of the opinion that Underwood J addressed himself to the correct legal issues in discussing these matters in his reasons for judgment. I am also of the view that he used the phrases "recognised psychiatric illness" and the like as appropriate synonyms for "nervous shock" during that process, as did Brennan J in Jaensch v Coffey (1983 - [1984] HCA 52; 1984) 155 CLR 549 at 559 - 560 in the passage cited in those reasons. In my opinion, his Honour was entitled to find, as he did, that the defendant had not established that a compensable injury or condition was suffered by the plaintiff before 23 May 1993. I can find no error in his approach and none in his conclusions. Indeed, I find the same to be wholly persuasive.

GRAEME JAMES GREGORY WILSON v CHERIE JAYNE HORNE

33 By a writ filed on 23 May 1996, the respondent sued the appellant for damages and following a defended hearing obtained a judgment for $55,000. The appellant has appealed against that judgment. The respondent was born on 12 April 1968. The appellant is the respondent's uncle and is 25 years her senior. The basis for the respondent's action against her uncle was her claim that during the period between 1973, when she was 5 years of age, and 1980, when she was 12 years of age, he repeatedly sexually abused her. The only claim pursued by the respondent in her statement of claim was based on the appellant's negligent breach of duty. A claim of trespass was not pursued.

34 Whilst the appellant put the respondent to proof in relation to the factual basis for her claim, he did not give evidence at the hearing of the action. The key issues raised on behalf of the appellant were whether a cause of action in negligence was available to the respondent, and, if so, whether it was statute barred by the Limitation Act 1974, s5(1). These are the issues which are central to this appeal.

35 In finding that the respondent had established her claim in negligence, the learned trial judge found that the appellant had repeatedly sexually abused her. On behalf of the appellant, it is contended that the acts of repeated sexual abuse which were found to have occurred provided the respondent with the basis for an action alleging intentional trespass, and that is the only action available to her. Put another way, it is submitted that acts amounting to an intentional trespass cannot be relied upon to establish a negligent breach of duty.

36 No doubt the respondent pursued a claim of negligence rather than trespass because of problems presented by the Limitation Act 1974. The respondent's claim is that she did not suffer damage, in this instance personal injuries, as a consequence of the appellant's sexual abuse until subsequent to 23 May 1993. Damage is an essential ingredient of a claim in negligence. If the respondent did not suffer damage until after 23 May 1993, her cause of action did not accrue until after that date and it is not statute barred. Damage is not an ingredient of a claim in trespass. The causes of action open to the respondent in trespass accrued as the acts of sexual abuse occurred, that is, by 1980 at the latest. Had she pursued a trespass claim, the appellant could have successfully relied on the Limitation Act, s5(1), to defeat it.

Was the respondent entitled to pursue a claim in negligence or was the only claim open to her one of trespass?

37 Counsel for the appellant submits that acts amounting to an intentional trespass cannot be relied upon to establish a negligent breach of duty. He says that for intentional direct acts, trespass is the only action which may be brought. Counsel referred to the decision of the High Court in Williams v Milotin (1956 - [1957] HCA 83; 1957) 97 CLR 465. In the course of construing a section of the Limitation of Actions Act 1936 (SA), the court considered what actions could have been brought in the form of "actions on the case" prior to the introduction of the judicature system, and said at 470:

"At that time the present action might have been framed as an action of trespass. For it seems that the facts which the plaintiff, by his next friend, intends to allege are that he was immediately or directly hit by the motor car driven by the defendant as a result of the negligence of the defendant himself. There is no suggestion that the defendant intended to strike him. If that had been the allegation the action could have been brought in trespass and not otherwise. But as only the negligence of the defendant is relied upon, while the cause of action might have been laid as trespass to the person, the action might also have been brought as an action on the case to recover special or particular damage caused by the defendant's negligence."

Counsel relied in particular on the sentences: "There is no suggestion that the defendant intended to strike him. If that had been the allegation the action could have been brought in trespass and not otherwise."

38 The above passage from Williams v Milotin was considered in detail by the learned trial judge in the reasons for judgment published when he dismissed a submission of no case to answer put on behalf of the appellant, Horne v Wilson 17/1998. The learned trial judge concluded at 5 that the abovementioned passage is:

" ... authority for the proposition that prior to the introduction of the Judicature System a direct and intentional application of force only gave rise to an action for trespass. However, nothing in that judgment purports to declare that that remains the law today."

It would be most surprising if it was still the law today as it is not unusual for a plaintiff to suffer injuries as a consequence of a wide range of conduct by a defendant which may include the intentional application of physical force. This occurs quite often when a patient makes a claim against a doctor, or an employee makes a claim against an employer. In the case under consideration, the conduct of the appellant about which complaint is made included acts of intentional trespass as well as other conduct, such as showing the respondent pornographic magazines, involving the respondent in acts of deception and bribing her. If the submission put on behalf of the appellant is correct, a plaintiff is barred from relying on any part of a defendant's conduct which can be categorised as an intentional trespass to support the plaintiff's negligence claim. This would impose a significant restriction on the conduct of the defendant upon which a plaintiff may rely. If that restriction exists today, it is to be expected that it will be clearly spelt out in the authorities.

39 The judicature system began with the Judicature Act 1873 (UK). There have been many developments referable to negligence in the law of torts since the introduction of the judicature system, probably the most significant being the decision in Donoghue v Stevenson [1932] AC 562_._ That decision places no restriction on the nature of the conduct which may be relied upon to establish a negligent breach of duty. Modern legal authorities and texts dealing with torts founded on negligence make no reference to a restriction as asserted on behalf of the appellant. Support for the absence of such a restriction comes from Carroll v Folpp, an unreported decision of Dunford J in the Supreme Court of New South Wales dated 10 February 1998, Butterworths unreported judgments BC9800272. In that case, it was put to the learned judge that if he found that the defendant had deliberately, as distinct from negligently, driven his motor vehicle into the plaintiff, the plaintiff's action in negligence must fail. Williams v Milotin (supra) was cited as authority for the submission. Dunford J distinguished that decision and observed:

"It was not concerned with whether a defendant who has failed to take reasonable care for the safety of another can escape liability in negligence by showing that his actions were intentional; and I know of no case where it has been held to be a good defence."

He also distinguished the judgment of the full court in Elliott v Barnes (1951) 51 SR(NSW) 179, which contains passages from old authorities and the 1868 edition of Bullen and Leake Precedents of Pleading 3rd ed, to the effect that if the act which caused the injury was deliberate, the action may be brought in trespass but not in negligence. In that case, the issue before the court was whether the cause of action could be pleaded in negligence if the act causing the injury was immediate and direct rather than indirect. The full court held that it could be. The court was not considering a deliberate act, so the issue of whether a defendant who failed to take reasonable care for the safety of another could avoid liability by showing that his actions were intentional did not arise.

40 The learned judge referred to Charlesworth & Percy on Negligence 9th ed (1997) 1 - 21. That paragraph is as follows:

"Wilful negligence. Negligence in this context may consist in a wilful or an intentional act. This is because negligence, as the breach of a duty to take care, is concerned with conduct and not with intention. Of course, it is no defence to prove that the defendant intentionally inflicted the damage in question and did not cause it by mere carelessness. If the driver of a heavy lorry deliberately were to run into a bicycle and destroy it, he can be sued for negligence, just as if he had destroyed it by careless driving. If a trench is made in the highway, a red lamp being provided to give warning of its presence, and A, seeing X approaching and intending to cause him to fall into the trench, removes the red lamp so that X does indeed fall into the trench and is hurt, A is liable in negligence. Far from being a defence, his intention becomes instead an important matter which actually facilitates proof of negligence."

41 Dunford J rejected the submission that if the defendant had driven into the plaintiff deliberately, the plaintiff's cause of action in negligence failed and the only cause of action open to the plaintiff was in trespass. I agree. I reject the appeal insofar as it is asserted that the respondent could not rely on acts of the appellant which amounted to an intentional trespass to found a cause of action in negligence.

Is the respondent's negligence claim statute barred?

42 The appellant relies upon the Limitation Act, s5(1), and says that the respondent's cause of action accrued more than three years before her writ issued, and accordingly her claim is statute barred. The respondent says she suffered no injury as a result of the appellant's breaches of duty until after 23 May 1993, and, in result, her cause of action did not accrue over three years prior to the institution of proceedings.

43 As to the accrual of the respondent's cause of action, the learned trial judge referred to Cartledge and Others v E Jopling & Sons Ltd [1963] AC 758, a decision on a claim for damages for personal injuries as a consequence of the defendant's negligence, and Pirelli General Cable Works Ltd v Oscar Faber & Partners (a firm) [1983] 1 All ER 65, a decision on a claim for damages to a building arising from its negligent design. These decisions are authority that a cause of action for a negligent breach of duty accrues when the damage came into existence, not the date when the damage was discovered, or should, with reasonable diligence, have been discovered.

44 I have reservations about whether, in the unusual circumstances of the respondent's case, her cause of action accrued when she first suffered personal injury rather than when it was first discovered or reasonably discoverable. I will return to this. I proceed on the basis that in determining when a cause of action accrues, the time when personal injury was suffered is when it first occurred regardless of the plaintiff's knowledge of its occurrence.

45 Whilst sexual abuse is frequently accompanied by immediate physical injury, that is not asserted to be so in this case. On behalf of the appellant, it is put that the evidence established that the sexual abuse caused the respondent to suffer from a sexual development disorder by 1980 at the latest. The appellant contends that this was a personal injury which brought about the accrual of the respondent's cause of action at a time which would make it statute barred.

46 The respondent gave evidence that as she developed through to maturity she was promiscuous. Doctor Sale attributed this behaviour to her sexual abuse. With reference to an incidence of this behaviour when the respondent was 6 years of age, Dr Sale said it was a behaviour problem which probably affected her development, her personality and her character. As to promiscuous behaviour by the respondent when she was 12 years of age, Dr Sale said she had a sexual development disorder. He drew a distinction between development disorders and psychiatric disorders and categorised her disorder as developmental, although he acknowledged that it was on the cusp of being a psychiatric disorder.

47 The respondent's development disorder was a mental consequence of the appellant's sexual abuse. Whilst the law readily recognises the mental consequences of a physical injury as being compensable damage, the situation is different where, as here, the mental consequence is not linked to any physical injury.

48 As to mental disturbances which give rise to a claim for damages for personal injuries, the learned trial judge directed himself in accordance with the following passage from the decision of Brennan J in Jaensch v Coffey (1983 - [1984] HCA 52; 1984) 155 CLR 549 at 559:

"A century ago psychiatric illness, without more, was not a form of harm or damage for which damages for negligence could be recovered: Victorian Railways Commissioners v Coultas. But at least for the last half-century 'neurasthenic breakdown amounting to (psychiatric) illness' has been held to be 'without more ... a form of harm or damage sufficient for the purpose of any action on the case in which damage is the gist of the action, ... supposing that the other ingredients of the cause of action are present': per Dixon J in Bunyan v Jordan. The term 'nervous shock' has been used to described [sic] that form of damage, although the term may not be an accurate medical description of the range of psychiatric illnesses which it is intended to cover -- 'any recognizable psychiatric illness' was the description used by Lord Denning MR in Hinz v Berry, and cited by Windeyer J in Mount Isa Mines Ltd v Pusey, and that description must be right. Compensation is awarded for the disability from which the plaintiff suffers, not for its conformity with a label of dubious medical acceptability. The term 'nervous shock' is useful nevertheless as a term of art to indicate the aetiology of psychiatric illness for which damages are recoverable in an action on the case when the other elements of the cause of action are present."

49 Consistent with the above passage, the learned trial judge expressed the issue which he had to determine as being whether the appellant had established that it was more probable than not that prior to 23 May 1993, the respondent had suffered from a recognisable psychiatric illness caused by the appellant's breach of his duty of care. As to the onus of proof on this issue being the appellant's, see Pullen v Gutteridge Haskins & Davey Pty Ltd [1993] VicRp 4; [1993] 1 VR 27.

50 The appellant submits that the learned trial judge erred in holding that it was necessary to establish that the respondent suffered from a recognisable psychiatric illness. In my view, he did not err. His approach accords with the decision of Brennan J in Jaensch v Coffey (supra) and the authorities there cited. Additional authorities are Tsanaktsidis v Oulianoff (1980) 24 SASR 500, Mitchell J at 501 and Coates and Another v Government Insurance Office of New South Wales (1995) 36 NSWLR 1, Gleeson CJ at 3.

51 The issue being whether the appellant had established that the respondent had suffered from a recognisable psychiatric illness which precipitated the accrual of her cause of action outside of the limitation period, the learned trial judge found against the appellant. He accepted Dr Sale's evidence that the development disorder which occurred outside the limitation period did not amount to a recognisable psychiatric illness. In the absence of contrary evidence he could not have done otherwise.

52 I am accordingly satisfied that the learned trial judge did not err and the appeal should be dismissed.

53 Had the evidence established that the development disorder suffered by the respondent amounted to a recognisable psychiatric illness, it would have been necessary to determine whether the respondent's cause of action accrued at the time she suffered from that condition, or at such time as she first discovered it or could reasonably have discovered it. The decision of the House of Lords in Cartledge v E Jopling (supra) is authority that the cause of action accrued when she first suffered from the condition regardless of whether she was aware of it. In that case, the House of Lords considered a claim by workers who contracted pneumoconiosis by inhaling toxic dust over a period of years. The workers suffered a substantial injury to their lungs before it could be discovered. This damage was suffered outside the applicable limitation period. Their Lordships rejected a submission on behalf of the workers that for the purposes of establishing when a cause of action accrues, the time when injury to a plaintiff occurs is when the plaintiff becomes aware of it. In rejecting that submission, their Lordships adverted to s26 of the Limitation Act 1939 (UK) which is in similar terms to s32(1) of the Limitation Act 1974. Section 26 provides:

"Where, in the case of any action for which a period of limitation is prescribed by this Act, either -- (a) the action is based upon the fraud of the defendant or his agent ... or (b) the right of action is concealed by the fraud of any such person as aforesaid, or (c) the action is for relief from the consequences of a mistake, the period of limitation shall not begin to run until the plaintiff has discovered the fraud or the mistake ... or could with reasonable diligence have discovered it."

54 Their Lordships, in essence, concluded that as s26 provided for the postponement of the commencement of the limitation period in cases involving fraud or mistake to the date when the fraud or mistake is discovered, the necessary implication was that there could be no similar postponement in relation to cases involving personal injury. The following passage from the decision of Lord Reid at 771 is an example of the approach which was taken:

"It is now too late for the courts to question or modify the rules that a cause of action accrues as soon as a wrongful act has caused personal injury beyond what can be regarded as negligible, even when that injury is unknown to and cannot be discovered by the sufferer, and that further injury arising from the same act at a later date does not give rise to a further cause of action. It appears to me to be unreasonable and unjustifiable in principle that a cause of action should be held to accrue before it is possible to discover any injury and, therefore, before it is possible to raise any action. If this were a matter governed by the common law I would hold that a cause of action ought not to be held to accrue until either the injured person has discovered the injury or it would be possible for him to discover it if he took such steps as were reasonable in the circumstances. The common law ought never to produce a wholly unreasonable result, nor ought existing authorities to be read so literally as to produce such a result in circumstances never contemplated when they were decided.

But the present question depends on statute, the Limitation Act, 1939, and section 26 of that Act appears to me to make it impossible to reach the result which I have indicated. That section makes special provisions where fraud or mistake is involved: it provides that time shall not begin to run until the fraud has been or could with reasonable diligence have been discovered. Fraud here has been given a wide interpretation, but obviously it could not be extended to cover this case. The necessary implication from that section is that, where fraud or mistake is not involved, time begins to run whether or not the damage could be discovered. So the mischief in the present case can only be prevented by further legislation."

55 In my respectful view, determining the time when personal injury is suffered for the purposes of assessing when a cause of action has accrued is not a matter of statutory construction, and the learned members of the House of Lords gave too much weight to s26. It can be extremely difficult to determine when a personal injury was first suffered. To hold that personal injury did not occur until the plaintiff discovered it, or it was reasonably possible for the plaintiff to do so, simply establishes the time when it was suffered for the purposes of the accrual of a cause of action. The cause of action cannot accrue until that date. This does not involve a postponement of the commencement of the limitation period to a date subsequent to the accrual of the cause of action, which is what s26 provides for. As the submission which their Lordships were considering did not involve a postponement of the commencement of the limitation period, but the time of its commencement, in my respectful submission, s26 had little bearing on whether the submission should have been accepted.

56 Cartledge v E Jopling has not been followed in New Zealand or Canada. In S v G [1995] 3 NZLR 681, the Court of Appeal followed the Supreme Court of Canada in K M v H M (1992) 96 DLR (4th) 289, and held that where a victim of sexual abuse suffers psychological and emotional harm resulting from that abuse, the cause of action against the abuser accrues only when the victim discovers the link between the abuse and the harm.

57 I am not aware of any Australian decisions that have considered the approach taken in New Zealand to actions involving sexual abuse. However, discovery of damage has been held to be determinative of the time when damage occurs for the purposes of ascertaining when a cause of action in negligence accrues when a claim is made for economic loss as a consequence of a latent defect in a building. See Pullen v Gutteridge Haskins & Davey Pty Ltd (supra), where the Full Court in Victoria so held, applying the following dicta from the decision of Deane J in Hawkins v Clayton and Others (1988) 164 CLR 539 at 587:

"A cause of action in negligence is complete when the damage caused by the breach of duty is sustained. It is at that time that, in the ordinary case, the cause of action 'first accrues' for the purposes of a provision such as s14(1) of the Limitation Act. It was submitted, on behalf of the plaintiff, that this Court should qualify that settled position by a general proposition that, at least in the case of a claim in negligence for damages for economic loss, time does not commence to run for the purposes of a provision such as s14(1) until the stage is reached when the plaintiff discovers, or could on reasonable inquiry have discovered, that the damage has been sustained. In support of that proposition, particular reliance was placed upon the decision of the Supreme Court of Canada in Kamloops v Nielson (1984) 10 DLR (4th) 641 (esp at pp 681ff); (1984) 2 SCR 2 (esp at pp 35ff.) and a passage in the judgment of this Court in South Australia v Johnson (1982) 42 ALR 161, at p169. I do not think that those cases, upon proper analysis, support the broad proposition for which the plaintiff contends. Such support is, however, to be found in the judgment of the Supreme Court of Canada in Central Trust Co v Rafuse, at pp 535 - 536.

Kamloops, like the decision of the English Court of Appeal in Sparham-Souter v Town and Country Developments (Essex) Ltd [1976] QB 858 which the Supreme Court of Canada preferred to the subsequent decision of the House of Lords in Pirelli General Cable Works Ltd. v Oscar Faber & Partners [1983] 2 AC 1, was a case where economic loss had been sustained as a consequence of the development of a latent defect in a building. Commonly in such cases, the building never existed and was never owned without the defect and (in the absence of consequential collapse or physical damage or injury) the only loss which could have been sustained by the owner was the economic loss which would be involved if and when the defect was actually discovered or became manifest, in the sense of being discoverable by reasonable diligence, with the consequence that the damage was then sustained by the then owner (cf Sutherland Shire Council v Heyman [1985] HCA 41; (1985) 157 CLR 424, at pp 503-505). The position is different in cases where all or some of the damage, be it in the form of physical injury to person or property or present economic loss, is directly sustained in the sense that it does not merely reflect diminution in value or other consequential damage which occurs or is sustained only when a latent defect which has existed at all relevant times becomes manifest. In those cases, damage is sustained when it is inflicted or first suffered and the cause of action accrues at that time. I do not read the passage in the judgment of the Court in South Australia v Johnson upon which the plaintiff relied as intended to effect any considered qualification of that general rule. In so far as Rafuse establishes a different general rule for Canada in relation to the operation of Statutes of Limitation, I am not persuaded that it should be followed in this country. That is not, of course, to say that the general rule may not be subject to qualification in some special circumstances or that its application may not involve unresolved difficulties in special categories of case (eg cases where all that is involved at the time of a tortious act is a risk of future economic loss: cf Schlosser, 'Some Recent Developments in the Law of Limitation of Actions, Concurrent Liability and Pure Economic Loss', Alberta Law Review, vol 25 (1987), 388, at pp 393-394)."

Mason CJ and Wilson J agreed with the substance of what Deane J had written.

58 Deane J confirmed that in determining when damage was suffered for the purposes of establishing when a cause of action had accrued, the general rule is that damage such as physical injury to the person is sustained when inflicted, not when the plaintiff discovers it, or, on reasonable enquiry, could have discovered it. It is however pertinent to note that Deane J recognised that the general rule may be subject to qualification in some special circumstances. Aspects of this case that might amount to special circumstances are that the sexual abuse occurred when the respondent was a young child. The sexual abuse was accompanied by conduct on the part of the appellant specifically directed to encouraging the respondent not to reveal the appellant's behaviour. As the respondent's uncle, the appellant was in a position to influence her and abused that relationship to encourage her silence. The conduct of the appellant was of a type which could result in the respondent repressing her memory of it, as in fact occurred in this case. It was difficult for the respondent to recognise her emotional and psychiatric condition and the link between it and the sexual abuse which caused it.

59 These special circumstances may have warranted a finding that the time when the respondent suffered personal injury for the purposes of determining when her cause of action accrued was the time when she first knew or could reasonably have known she was suffering from a psychiatric illness. It is not necessary for me to explore this any further as I agree with the learned trial judge that the respondent's development disorder was not a psychiatric illness and she did not suffer from a psychiatric condition capable of crystallising a cause of action until well inside the three year limitation period.

60 For these reasons given I agree with the decision of the learned trial judge and would dismiss the appeal.