Australia: Sloppy Pleadings, Inadequate Evidence And The Relevance Of A Lack Of Risk Management Systems

Last Updated: 7 April 2009
Article by Jocelyn Kellam

Most Read Contributor in Australia, November 2016

Hobbs v Oildrive [2008] QSC 45

  • Pleading a claim correctly is important and courts will carefully consider such issues, even if it does not affect the ultimate result.
  • Risk management systems are relevant to whether a defendant is negligent but there needs to be evidence of practice in the industry.
  • In order to claim damages, a real commercial opportunity must be lost.

A fire caused by a slasher machine on Oildrive's property spread to Mr Hobbs' property. Hobbs claimed damages for loss of income from a mango orchard. Oildrive did not have a "risk management system" in place which Hobbs said was negligent.

Included in the issues to be decided by the Supreme Court of Queensland were a pleading question, that is, whether the alleged duty of care had been correctly described in the statement of claim, whether there was any breach of duty (that is whether a reasonable person in Oildrive's position would have had a risk management system in place to prevent fires) and finally whether Hobbs lost a commercial opportunity to produce and sell mangoes as a result of the fire.

The plaintiff's claim failed.

The pleading question

Some readers like technical drafting questions. Other readers can skip this section as it does not affect the result.

After pleading a number of non-contentious facts, the statement of claim said:

"In the premises of this paragraph, the defendant by itself, its servants or agents, owed [the plaintiff] a duty to exercise reasonable care in and about the management and conduct of the physical conditions and activities on the defendant's property, by acting in a manner in which a reasonable man in the defendant's position ought act in respect of any foreseeable risk of injury, having regard to considerations of magnitude of the risk, the degree of the probability of its occurrence along with the expense, difficulty and inconvenience of taking alleviating action and any other conflicting responsibilities which the defendant may have."

The court thought it immediately apparent that this formulation of the duty of care was reminiscent of statements in Wyong Shire Council v Shirt. However, there was a mistake in the way it was being used. Although this statement is undoubtedly authoritative in approaching the task of deciding whether there has been a breach of duty, it does not define the content of the duty.

Did it matter? The Supreme Court noted that there was a danger in formulating a duty of care in specific terms. It referred to the High Court in Graham Barclay Oysters Pty Ltd v Ryan [2002] HCA 54; (2002) 194 ALR 337, specifically Justice McHugh:

"The duty of care owed by a manufacturer or producer to a consumer is a duty to take reasonable care to avoid injury to the consumer. To formulate the duty in more specific terms invites error because it is likely to mix a question of law (whether a duty existed) with a question of fact (whether a breach occurred). If the duty if formulated in specific terms, the issue on breach is whether the duty has been performed in accordance with the terms of the duty as formulated. But, as Wyong Shire Council v Shirt shows, the question of breach is far more complex than an affirmative or negative answer to the question whether the defendant carried out the duty as formulated. It involves evaluating and weighing a number of competing considerations."

How was it fixed? The court did not have to make any orders regarding amendment of the pleadings. Common sense prevailed and Oildrive accepted that it owed the plaintiff a duty to take reasonable care to prevent damage to his property as a result of fire. Oildrive accepted that this formulation covered the prevention of fires at, as well as controlling the escape of fires from, its property.

Was Oildrive negligent?

Oildrive did not have a risk management system in place to identify potential fire risks, including the risks associated with slashing grass on the defendant's property. Hobbs thought this was negligent. The Supreme Court of Queensland thought not.

To win this point, Hobbs needed to establish that Oildrive's duty to take reasonable care required a risk management system to be in place to identify potential fire risks (including the slasher), and that, had there been such a fire risk management system, the risk associated with slashing grass on the defendant's property on this day would have been identified.

Hobbs' evidence on this issue was too little. There was little evidence to the effect that a fire risk management plan should be prepared for all orchards or that it was something which would have been expected to be undertaken by a reasonable person in the position of the defendant at the time. No evidence was led as to the cost to a farmer, the availability of fire risk assessment consultants to undertake such assessments, whether there was any practice amongst farmers at the time to have such fire risk assessments undertaken, or as to whether such an assessment was recommended by such groups as the Rural Fire Board or farmers' associations.

Claim for compensation

Could Hobbs get compensation for its burnt mango trees and for future loss of income?

Leaving aside that Hobbs had failed to establish that Oildrive was negligent, the Supreme Court also thought that Hobbs had failed to establish that he had lost the commercial opportunity to derive income from the orchard. To do so, Hobbs would have to establish that Oildrive's negligence caused him to lose a commercial opportunity of some not negligible value by reference to the degree of probabilities or possibilities.

There was some discussion by the court as to what was the proper approach for the assessment of damages in a case where trees in an orchard were damaged by fire - that is, whether the award should be the amount of the depreciation in the value of the land as a result of the injury. That test was thought to be insufficient if the land was intended to be used for a profitable purpose which had been frustrated, postponed, interrupted or made less profitable.

Oildrive said that the farm would not have been profitable had the fire not occurred and accordingly concluded that there was no commercial value to any opportunity which might have been lost to the plaintiff.

Again, Hobbs' evidence was insufficient. The court found that the burnt orchard was in reality an abandoned mango farm, which had been neglected for several years, with no equipment and little infrastructure. At best it held potential for the future. Therefore Hobbs' claim failed.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.