Abel v Amaca Pty Ltd Under External Administrators (Formerly James Hardie & Coy Pty Ltd) [2010] SADC 98

Judgment date: 23 July 2010

South Australian District Court 1

In Brief

  • The South Australian District Court has delivered the third judgment concerning an assessment of damages for an asbestos related matter since the enactment of the Dust Diseases Act 2005 (SA).
  • Amaca Pty Ltd avoids award of exemplary damages by virtue of the fact that it was not sued as an employer.

Background

William Alexander Abel (plaintiff) was employed by a building company from February 1963 to October 1979. During that time he was regularly exposed to asbestos cement building products both through his direct use of the products and by way of bystander exposure. It was conceded that the asbestos cement building products to which he was exposed were manufactured and sold by James Hardie & Coy Pty Ltd (defendant).

As a result of his exposure to asbestos cement building products, the plaintiff suffered from an asbestos related pleural effusion. The plaintiff was also informed that there was a possibility that he had developed mesothelioma. That diagnosis was ultimately ruled out.

The plaintiff developed a chronic adjustment disorder arising from his reaction to the discovery of his pleural plaques and as a result of the misdiagnosis of mesothelioma.

Barrett J awarded the amount of $80,000 in respect to the plaintiff's general damages and $36,500 in respect to past and future gratuitous care. No amount was awarded for the cost of replacement services or for exemplary damages.

Issues at Trial

The trial judge was required to determine the following:

  1. Liability
    1. What was the plaintiff's exposure to asbestos products manufactured by the defendant?
    2. Did the defendant owe a duty of care to people exposed in the way the plaintiff was exposed? Was the risk to such people foreseeable?
    3. What was the extent of the duty of care?
    4. Did the defendant breach its duty of care, and if so, in what way?
    5. If the defendant was negligent, what loss or injury did the negligence cause to the plaintiff?
  3. Damages
  4. Exemplary Damages

Judgment

During the trial the defendant conceded that the plaintiff had established on balance that he did work with the defendant's products and therefore was exposed to asbestos emanating from asbestos cement building products.

Barrett J found that the plaintiff was exposed to varying degrees of asbestos products and asbestos dust and that asbestos dust was constantly present during work hours at the plaintiff's employer's premises. The plaintiff was not exposed to any asbestos dust outside his employment from February 1963 to October 1979.

Section 8(2) of the Dust Diseases Act 2005 (SA) states:

"(2) A person who, at a particular time, carried on prescribed industrial or commercial process that could have resulted in the exposure of another to asbestos dust will be presumed, in the absence of proof to the contrary, to have known at the relevant time that exposure to asbestos dust could result in a dust disease."

The defendant argued that the words "presumed, in the absence of proof to the contrary" meant that the presumption was rebutted simply by the adducing of evidence tending to disprove that which is presumed and the evidentiary onus is discharged by the defendant upon the calling of that evidence.

However, Barrett J held that the defendant was required to prove on the balance of probabilities that it did not know during the time of the plaintiff's exposure to asbestos that the exposure of people in his position to asbestos dust could possibly result in a dust disease.

Barrett J examined a range of publications and literature tracing the history of the knowledge held by health authorities of the risks of exposure to asbestos. He found that at the time when the plaintiff was exposed to asbestos, the defendant was aware that people working in the Page 3 of 4 building industry were at a risk of illness from asbestos dust liberated from asbestos cement products. It was therefore reasonably foreseeable during the period of the plaintiff's employment that people such as the plaintiff might suffer an asbestos related disease arising from their exposure to asbestos dust.

It was held that the defendant was in breach of its duty of care by its failure to provide adequate warnings to end users of asbestos cement products. Those warnings should have included correspondence and the provision of brochures to building companies and warning labels on the products themselves. Furthermore, the defendant ought to have informed end users of precautions that might be taken to minimise their exposure to asbestos.

Damages

The plaintiff first experienced symptoms referable to his exposure to asbestos in 2005 at the age of 72 years. He was admitted to the Lyell McEwin Hospital suffering from a bleeding ulcer and investigations in hospital revealed a right pleural effusion.

The pleural effusion was drained on two occasions and the plaintiff was informed by Dr Nikitins that he may have developed mesothelioma. The plaintiff then underwent a video assisted thoracoscopy and a talc pleurodesis which confirmed that the plaintiff had not in fact developed mesothelioma.

As a result of his asbestos related pleural effusion, Barrett J found that the plaintiff had developed breathlessness. Barrett J also found that the plaintiff had developed a chronic adjustment disorder arising from the discovery of his pleural plaques and pleural effusion, together with the misdiagnosis of mesothelioma by Dr Nikitins.

The plaintiff was awarded $80,000 for past and future general damages together with $36,500 for past and future gratuitous services.

Exemplary Damages

Section 9(2) of the Dust Diseases Act 2005 (SA) allows the Court to make an award for exemplary damages. Barrett J observed that although exemplary damages may be awarded in negligence cases, those awards were likely to be "unusual and rare".

Barrett J found that "exemplary damages" was a term of art interpreted by the common law to require proof of reprehensible conduct which requires punishment. He found that the defendant's conduct could not be regarded as so reprehensible that exemplary damages would be awarded if the common law principles were applied. The plaintiff was not awarded any amount in respect to exemplary damages.

Implications

This is the third asbestos related matter determined in the State of South Australia in which damages have been formally assessed.2

In the two previous South Australian judgments, general damages have not exceeded $100,000 for more severe injuries (mesothelioma). This judgment would appear to confirm that the level awarded in respect to general damages for asbestos related cases in South Australia are unlikely to be comparable to the more generous awards in the Dust Diseases Tribunal of New South Wales.

This matter is also the first matter in which a defendant's liability in respect to s9(2) of the Dust Diseases Act 2005 (exemplary damages) has been determined. The findings of Barrett J in relation to the question of exemplary damages that the plaintiff must prove "reprehensible conduct which requires punishment" suggests that an award for exemplary damages in these types of matters will continue to be "unusual and rare."

The High Court has suggested in Gray v Motor Accident Commission, that exemplary damages are likely to be awarded in "cases of an employer's failure to provide a safe system of work for employees in which it is demonstrated that the employer, well knowing of an extreme danger this created, persisted in employing the unsafe system..."3

Had this been a case in which the employer was sued and found to have the requisite knowledge, the result may have been different.

1 Barrett J
2 See Ewins v BHP Billiton Ltd [2005] SASC 95 and Reynolds v Comcare [2006] SADC 136
3 (1998) 196 CLR 1

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