In late 2011, the first of five class actions arising from the 2009 Black Saturday Bushfires settled. The claim arose from a fire in Horsham which started after a live conductor became detached from a power pole top and ignited dry vegetation below. The fire burnt over 2000 hectares and destroyed 13 homes.
A class action was commenced by Mr Thomas against Powercor, the electricity company responsible for the distribution and maintenance of the line. After several weeks of evidence before Justice Forrest, in the Victorian Supreme Court, the parties settled the case on the basis that Powercor pay 55% of each group member’s claim, plus interest and legal costs. A number of ‘assessing principles’ were agreed between the parties, however several issues required Justice Forrest’s ruling. One of those issues was whether group members are entitled to recover damages for their own labour and that of volunteers for work to repair/reinstate damaged property.
The dispute arose in relation to the cost of labour for work carried out by Mr Thomas to reinstate fencing and stockyards following the fire, and by volunteers who assisted him. He agued that there was evidence before the Court to establish the reasonable cost of repairs to those items and it was not necessary for the Court to examine how those repairs were carried out or by whom.
Powercor argued that Mr Thomas was not entitled to compensation for his own efforts, or for those of other volunteers, unless he could establish that carrying out such work caused him some financial loss, for example, an inability to perform other work while performing the repairs.
Justice Forrest helpfully set out a number of basic principles which, as he said, ‘bear repeating’. He re-iterated that ‘the plaintiff is entitled to be put back, so far as money can do it, into the same position as if the damage had not occurred’. He also noted that benefits received from third parties (such as volunteers) will not be taken into account to reduce a defendant’s liability ‘unless those benefits were intended to relieve the defendant of liability to compensate the plaintiff’.
Justice Forrest noted that if Powercor’s argument was accepted, a plaintiff who carried the work out himself would ‘be precluded from damages unless he could show a direct financial loss in the sense of loss of earnings.’ That, he said, would lead to unfairness and inflexibility because, on the other hand, a plaintiff who could afford to pay to have repairs carried out would be entitled to compensation, as would an insurer bringing a subrogated claim
For those reasons, Justice Forrest rejected Powercor’s argument and held that Mr Thomas was entitled to recover the reasonable commercial cost of repairs to the fences and stockyards.
Thomas v Powercor Australia Ltd  VSC 586
Powercor has appealed Justice Forrest’s decision on this point. The outcome of that appeal will have wide-reaching effects, not only for the Horsham group members and the remaining Black Saturday bushfire class actions, but for recovery claims more generally.