Owner required to prevent defective vehicle being driven; no general obligation on driver to enquire as to roadworthiness

Judgment date: 11 August 2011

Harmer v Hare [2011] NSWCA 229

New South Wales Court of Appeal¹

In Brief

An owner of an unroadworthy vehicle fails to exercise reasonable care by allowing another person to drive the vehicle.
A driver has no duty to inspect another person's vehicle, before driving it, where it can be inferred from the vehicle owner's conduct that the vehicle is without defect.
Even where there is an intention to engage in illegal activity, no joint illegal enterprise can be established if an accident occurs during the journey, prior to the illegal activity commencing.

Background

The plaintiff was injured in a single vehicle motor accident on 6 November 1999. The defendant was the owner of the vehicle, but was too intoxicated to drive, so the plaintiff offered to drive instead. As the plaintiff drove through a roundabout, he lost control of the vehicle and collided heavily with a telegraph control.

The plaintiff's loss of control was alleged to have been caused by the tyres of the motor vehicle being completely smooth.

The plaintiff sustained severe traumatic brain injury. Judge Sidis determined damages at $1,735,250.59.

Liability Decision After First Trial

Following the first trial, her Honour Judge Sidis handed down a judgment on 14 March 2008. Judge Sidis found the plaintiff knew the tyres on the vehicle were bald and entered a verdict for the defendant. The Judge went on to consider contributory negligence which she assessed at 85% should her finding of no breach of duty be incorrect.

This decision was overturned on appeal. The Court of Appeal found that the trial judge had incorrectly recorded that the plaintiff had agreed in evidence that the tyres on the wheels were "not real good". The transcript, when obtained, recorded that the plaintiff, when asked what he remembered about the state of the tyres, had in fact stated: "not really, but I suppose good".

The Court of Appeal remitted the matter for a new trial on liability.

Liability Decision After Second Trial

The second District Court judgment was handed down on 14 April 2009. On this occasion, Sidis DCJ made the following findings:

The plaintiff did not know the tyres were bald;
The bald tyres were the cause of the vehicle's loss of control;
The defendant breached his duty of care to the plaintiff in failing to prevent him from driving the vehicle when it was not roadworthy and in failing to warn him of the risk of harm involved;
The plaintiff was guilty of contributory negligence in failing to inquire of the defendant about the vehicle's condition, or, if the defendant was too intoxicated to provide a sensible answer, to undertake an independent check of its condition.

Given these findings, Sidis DCJ entered a verdict for the plaintiff, subject to a reduction of 25% for contributory negligence.

The defendant appealed and the plaintiff cross-appealed.

Court of Appeal

The Court of Appeal observed that the simple case was complicated by 2 factors. Firstly, the plaintiff had extensive brain damage which rendered him unable to recall anything about the accident or the events that preceded it. Secondly, the defendant's "continued reliance on expert evidence to support its position". The Court of Appeal described the defendant's expert, Mr Bailey, as "an advocate".

The Court of Appeal ultimately rejected the arguments of the defendant on the issue of scope of duty and absence of duty. The defendant's arguments in this regard can be summarised as follows:

It was not possible to spell out the existence of a relevant duty of care simply from the fact that the defendant was the owner and passenger of the motor vehicle while it was being driven by the plaintiff;
It was relevant to the existence and scope of duty of care that the plaintiff and defendant were intending to travel to an area, fit the vehicle with 2 near-bald tyres and do burn outs;
The plaintiff's knowledge that the defendant was substantially intoxicated meant that, so far as any reliance for anything at all upon the defendant, the plaintiff was simply "chancing it". In other words, knowing the drunken owner could not be expected to act sensibly, no duty arose.

The court accepted the first point. The second and third points were rejected for the following reasons:

The accident occurred when the vehicle was travelling between the defendant's girlfriend's home and the plaintiff's home. There was nothing dangerous in that enterprise. There was nothing illegal about that journey nor its content. The court therefore rejected the proposition there was any similarity between the present circumstances and cases involving a joint illegal enterprise;
The circumstances were very different to those circumstances where a passenger voluntarily agrees to be driven by an intoxicated person, knowing that the driver was intoxicated. The court found that even though the defendant was quite drunk, he was not unable to function cognitively and therefore "well knew that the tyres were bald", and would have been aware of the fact that it had been raining and that the roads were wet.

Civil Liability Act

The Court of Appeal specifically rejected the argument that the defendant did not owe the plaintiff a duty of care and arguments that sought to limit the scope of the duty.

The court undertook a detailed analysis of s 5B and the obvious risk provisions of the Civil Liability Act 2002 (CLA).

Whilst a factual finding was made that the defendant did not tell the plaintiff that the tyres were bald, the court stated that even if the defendant had done this, it would not be enough to discharge the defendant's duty to exercise reasonable care to prevent the risk of injury materialising².

The Court of Appeal leant support to the primary judge's finding that the exercise of reasonable care required the defendant to refuse the plaintiff permission to drive the unroadworthy vehicle.

On this basis, the Court of Appeal found that the defendant's duty of care went beyond giving a warning. This moved the circumstances of the accident outside Part 1A of the CLA.

The court found that the risk was not obvious within the meaning of s 5F because the plaintiff was not aware that the tyres were bald.

Overturning the Finding of Contributory Negligence

The finding of contributory negligence was based upon:

an acceptance that the plaintiff knew the vehicle had been off the road for some time and failed to inquire about the vehicle's condition; and
a finding that the owner was too intoxicated to provide a sensible answer. The plaintiff therefore should have performed an independent check of the vehicle's condition.

The Court of Appeal noted that the failure of the plaintiff to inquire of the defendant about the vehicle's condition was not pleaded. The Court of Appeal stated "If the plaintiff did not know the tyres were bald ... there was no reason for him to inquire as to the vehicle's condition".

The implication is that unless a driver has a suspicion or reason to suspect that there will be a defect/danger in the condition of the vehicle, there is no onus to inquire of the owner as to the vehicle's condition.

The Court of Appeal ultimately found that there was no contributory negligence on the part of the plaintiff.

Implications

The Court of Appeal made it clear in Harmer v Hare that it is the responsibility of the owner of a defective vehicle to ensure that it is not driven.

Where the owner knows that his or her vehicle is defective, the duty of care extends to preventing another person from driving that vehicle, not just warning them of the defect.

Absent reasonable cause to suspect a defect, a driver is not required to ask the owner whether a vehicle he or she is about to drive is roadworthy.

When faced with a claim that an insured owner was negligent in allowing a claimant to drive a defective vehicle, it would be prudent for the insurer to investigate whether there were any circumstances which should have put the driver on notice that the vehicle contained a defect.

Footnotes

1 Whealy JA, Beazley JA and Sackville AJA

2 at paragraph 218

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