The High Court has dismissed Stephen and Susan Marsh’s application for leave to appeal a decision from The Court of Appeal (WA). Three important issues/outcomes have emerged from this case.
The principles of negligence and nuisance have not changed. The majority of the Court of Appeal concluded there was no duty of care for pure economic loss owed by Mr Baxter to the Marshes under the circumstances. That is, the law would not require a reasonable person in the position of Mr Baxter in turning his or her mind to whether to “direct head” or “swathe” the GM Crop to reasonably have in contemplation the effect of his actions on the economic interests of other farmers. That is, to consider the risk that NASAA would withdraw its organic certification of the Marsh's farm. In relation to nuisance, the well-known principle remains in that for there to be an actual nuisance there must be an unreasonable interference with the Marsh’s use and enjoyment of their land, which is an objective question. A person cannot increase the liability of his neighbour by applying his or her own property to special uses. Accordingly, the Marsh’s claim failed because their organic farming operation was abnormally sensitive (i.e. risk of de-certification) to GM incursion.
On the question of breach of duty, one of the issues was whether Mr Baxter was negligent in harvesting his GM Canola crop by using “swathing”. An important consideration of this case is that the harvesting methodology used by Mr Baxter was well-recognised and preferred. Further, he arrived at his decision to use “swathing” instead of “direct heading” on advice from an agronomist. If one’s actions are based on an informed decision, it is less likely to be found “unreasonable”.
The GM canola from Mr Baxter’s farm posed no risk of ‘genetic contamination’ (genetic trait transfer) to any crop grown on the Marsh’s land. Therefore, the case turned in part, on the reasonable foreseeability of a risk of decertification rather than on whether there was physical damage to the Marsh’s crop. The legal principles of negligence and nuisance may be tested in a future scenario, if genetic contamination is the result of the same swathing techniques are presently employed by Mr Baxter , now that we are armed with the knowledge of the possibility of canola incursion. Arguably, physical damage has occurred where the ‘damaged’ crops may no longer be considered to be of a particular species or possess particular traits, and therefore the case no longer is limited to pure economic loss.