Kennedy v Shire of Campaspe is a landmark decision recently handed down by the Court of Appeal of the Supreme Court of Victoria on the liability provisions of the Road Management Act 2004 (Vic) (Act).
The key take-away message is that a council who can prove it has fully complied with its road management plan can rely on the statutory defences.
However, it is critical that there is full compliance with all aspects of the road management plan. Adequate records must be kept to prove this.
Unfortunately, the Shire of Campaspe (the Shire) had not complied with the inspection regime in its road management plan and so was unable to avail itself of the statutory defences. As a result, the case was sent back to the County Court to determine if the Shire was negligent at common law.
Below we describe in more detail this landmark decision and the implications for councils and their road management responsibilities.
On 23 July 2007, Ms Kennedy tripped over a lip of between 10mm and 12mm (Lip), created by uneven concrete paring sections, sustaining a fracture to her right wrist.
Ms Kennedy completed a public incident report which was received by the Shire on 3 August 2007, and subsequently brought proceedings against the Shire for damages arising from an alleged breach of duty under s 40 of the Act and in negligence. The appeal to the Supreme Court followed the decision of the Trial Judge that the Shire could rely on a number of statutory defences.
The footpath on which Ms Kennedy tripped was categorised as a ‘secondary footpath’. Under the Shire’s road management plan (Plan) the standard for intervention in relation to secondary footpaths is a level of 30mm step in path surface levels. The Plan also requires that inspections of secondary footpaths are to be conducted every 18 months.
However, it was ultimately found to be a policy of the Shire, distinct from the Plan, that all lips in excess of 5mm be placed on a ‘proactive list’ for grinding towards the end of financial year, if the Shire’s budget permitted and/or if there were contractors to be sent to the area on another matter.
The forms used for footpath inspections specified levels of lip from 5mm to 30mm to be detected and reported by inspectors. The particular stretch of footpath on which the incident occurred had last been inspected by Mr Hitchcock on 6 July 2007, 18 months and two days after the previous inspection. The report from Mr Hitchcock was not received by the Shire until several months later, certainly after 1 November 2007. It was conceded by the Shire that the Lip should have been detected by the Hitchcock report, however it was not.
Statutory Duty and Available Defences
Section 40 of the Act imposes a statutory duty upon road authorities to inspect, maintain and repair public roads.
It was noted by the Court of Appeal that s 40(1) of the Act creates a hierarchy by which the relevant standard is to be determined, with recourse to a road management plan as a first point of reference, or policy in the absence of a plan.
Finally, failing the existence of a plan or policy, the duty will be determined by reference to the matters in s 101, such as the character of the road and the appropriate standard of maintenance and repair.
The fact that the standards in a road management plan are given priority over standards specified by way of policy was held to have significance for the operation of several statutory defences.
In summary, the defences in the Act upon which the Shire purported to rely were:
- Section 102: which removes liability for a breach of s 40 or for negligence in respect of a failure to remove a hazard or defect or to give warning unless the road authority had actual knowledge of the risk which resulted in the harm. – A road authority will be taken to have actual knowledge of a particular risk where the deterioration of the road had been reported under s 115.
- Section 103: provides a defence to an allegation of wrongful exercise or a failure to exercise a function where the act or omission is consistent with a policy of road management.
- Section 105: a road authority may establish that it has taken such care as was required to ensure the road was not dangerous to traffic by proving that it had a policy which addressed the cause of the incident, and that policy had been complied with.
- Section 39(5): a decision or standard which is a policy or policy decision relating to the road management function of a road authority is taken to satisfy the statutory duty and any common law duty of the road authority in the exercise of that function.
Grounds of Appeal
The Court adopted a very systematic approach to the grounds of appeal put forward by Ms Kennedy, and the further ground raised by the Shire. Each of the following issues were addressed in turn, with the conclusions relating to each issue bearing on the consideration of the next.
- Did the Shire comply with the Plan?
- Did the Shire have actual knowledge of the risk?
- What was the ‘policy’ of the Shire and did it address the matter which caused the incident?
- Did the Shire act in accordance with its policy
- Would compliance with the Plan and the policy have detected the risk and, if detected, would the Shire have warned or taken other action under the Plan or policy?
- Does the operation of s 39(5) satisfy any statutory or common law duty?
1. Did the Shire comply with the Plan (applicable to ss 103 and 105)?
It was suggested by Ms Kennedy that the Trial Judge erred in finding that the Shire complied with the Plan. As already noted, the Plan provided for inspection of secondary roads to be conducted every 18 months. The finding of the Trial Judge was based on the conclusion that, while the inspection of 6 July 2007 was two days outside the 18 month maximum period, the inspection itself could cure the delay and restart the calculation of the 18 month period.
With respect to the notion of a ‘curative’ inspection outside the required period, the Court held that, if a breach of the duty to inspect at a certain frequency can be cured by an inspection that occurs at any subsequent time, the standard imposed under the Plan would be entirely undermined.
However, it was not the case that such a breach was incapable of being cured after the fact. For a subsequent inspection to cure a failure to inspect in accordance with the Plan, it was held that the purpose of the inspection must be met, meaning the defects and hazards in the footpath have come to the attention of the road authority for decision regarding remedial action. That meant the Shire’s breach could not be cured until the Shire had at least obtained the relevant inspection report.
There was great uncertainty as to when the 6 July 2007 report was received, however evidence put forward by the Shire confirmed that it could not have been before 1 November 2007. Therefore, at the date of the incident (23 July 2007), the breach of the Shire in failing to inspect the footpath within the required period, had not been cured, and it continued until the report was actually received. This precluded reliance on the defences under ss 103 and 105, as the acts of the Shire were not in compliance with the Plan.
2. Did the Shire have actual knowledge of the particular risk (within the meaning of s 102)?
Ms Kennedy attempted to argue that the notice of the incident given pursuant to s 115 and received by the Shire on 3 August 2007 meant that the Shire had ‘actual knowledge’ of the particular risk (the Lip) which caused the incident and her injury.
This argument was rejected as, logically, a report that an accident has already occurred cannot constitute prior notice of the risk that led to the accident. The wording of s 102 requires actual knowledge of the risk at the time of the alleged failure to remove a hazard or defect or give warning, which could be inferred from notice under s 115 being given prior to the incident, but not after.
Despite agreeing with the Shire on the above point, it was held that the defence in s 102 was unavailable by reason of s 102(4) of that provision, which expressly excludes the defence where the liability of the road authority arises out of a breach of the s 40 duty to inspect. As the Shire was in continuing breach of its obligation to inspect as set out by the Plan, it was in breach of its s 40 duty, and so the s 102 defence did not apply.
3. What was the ‘policy’ of the Shire and did it address the matter which caused the incident?
Several of the statutory defences make reference to the ‘policy’ of a road authority, a term for which no formal requirements are spelled out in the Act. The Shire contended that the Plan was correctly understood as the relevant policy of the Shire, as no minute of decision relating to a separate policy had been put forward.
While the Act allows for a policy to be no more than a road management plan, the distinction between a policy and a plan was found to be sufficient to infer that a policy may be separate from a plan, and may impose differing standards.
Accordingly, Ms Kennedy submitted that the ‘proactive list’ was a policy, distinct from the Plan, which involved the grinding down of lips on footpaths below the intervention level of 30mm as specified in the Plan.
The Court found that the ‘proactive list’ was sufficiently embedded in the practice of the Shire, over a considerable period of time, with recognition in the protocols of the Shire, that it amounted to a policy of the Shire.
The fact that the proactive list specifically addressed lips of secondary footpaths that fell below the Plan intervention level, including the size of the 10-12mm Lip in this case, was confirmed the by the range of levels identified for detection and reporting in the relevant inspection forms. The Shire was therefore found to have a policy which addressed the matter that was the cause of the incident.
4. Did the Shire act in accordance with its ‘proactive list’ policy? (applicable to ss 103 and 105)
It was conceded by the Shire on appeal that if the proactive list is taken to be a policy of the Shire, it did not act in accordance with its policy. In conducting the inspection on 6 July 2007, Mr Hitchcock was obliged to report any lip in excess of 10mm and he had not done so.
However, the hierarchy of duties imposed by s 40(1) dictates that the primary obligation of the Shire was to act in accordance with the Plan, and not the proactive list policy. As already determined, there was a continuing breach of the standards in the Plan, because of the failure to inspect the footpath within 18 months of the last inspection.
The same hierarchy of obligation applies in relation to intervention levels, meaning that the Shire was bound to adhere to the intervention level of 30mm stipulated in the Plan, regardless of the level specified in any other policy.
Phrased in general terms, where the policy of a road management authority is different from the authority’s road management plan and sets different standards, a failure to act in accordance with the policy will not give rise to liability under s 40(1) where the authority acts in accordance with the standard set by its plan. This construction of s 40 resolves the issues that might otherwise flow from the existence of inconsistent standards between a road authority’s plan and policy.
Accordingly, the Shire’s failure to comply with the proactive list policy did not give rise to liability under s 40, and therefore recourse to the defence under s 105 was not necessary.
Similarly, for the purposes of s 103, the ‘policy’ of the Shire was the Plan, in respect of which the Shire was in continuing breach at the time of the incident. The fact that the Shire did not act in accordance with the Plan precluded reliance on s 103.
5. Would compliance with the plan and the Shire’s policy have detected the particular risk and, if detected, would the Shire have taken remedial action in accordance with the Plan or its policy?
The only breach of the Plan established in this case was the failure of the Shire to inspect the footpath in accordance with the standard for the frequency of inspections. As the intervention level under the Plan was 30mm, it could not be concluded that an inspection within the permitted time would have detected the Lip. Under the Plan considered in insolation, there was no requirement to observe, measure or record lips between 10mm and 12mm.
However, if there had been compliance with the ‘proactive list’ policy, which required recording of all lips in excess of 10mm, the Lip that caused Ms Kennedy’s fall would have been detected.
If the Lip had been detected, Ms Kennedy contended that a number of inexpensive and ordinary responses by the Shire could have avoided the incident, such as the dotted line marked on the pavement after the incident to alert pedestrians to the hazard. The Court rejected this submission, concluding that the size of the Lip was too small to trigger any remedial action under the Plan, even a warning. There was an insufficient causal connection between the Shire’s failure to comply with the Plan and the incident.
In the alternative, Ms Kennedy attempted to demonstrate that the incident occurred as a causal consequence of the breach of the ‘proactive list’ policy, to record all lips in excess of 5mm. This was also rejected by the Court, as the evidence made clear that inclusion of a particular lip on the proactive list did not guarantee that any remedial action, including a warning, would be prompt. Had Mr Hitchcock recorded the Lip on 6 July 2013, there is no basis to suggest that the Shire would have taken remedial action before the incident on 23 July 2007.
The Court reiterated that the Shire was in breach of s 40 as a result of the continuing breach of its duty to inspect secondary footpaths every 18 months, as required by the Plan. However it could not be inferred that the lapses by the Shire caused the incident.
6. By operation of s 39(5), did the making of the Plan satisfy any statutory duty or common law duty for road management functions?
The Shire raised the discrete question of the operation of s 39(5) on appeal, submitting that this section would deem the Shire to have satisfied any statutory or common law duty by reason of its making the Plan, regardless of whether that Plan was complied with.
In was noted that a literal reading of s 39(5) would suggest that all a road management authority needs to do to escape liability for a breach of statutory or common law duty is to make a policy that is not unreasonable. This interpretation could not be accepted as it would render the other more specific defences, which require compliance with the relevant policy (ss 103 and 105), futile.
The Court clarified that the purpose of s 39(5) is to limit challenges to the policies of road authorities on road management functions to allegations of unreasonableness.
Ultimately, the Court allowed the appeal on the basis that the possibility of liability at common law remained open to Ms Kennedy, the Trial Judge failing to have made a finding on that issue. The matter was remitted to the County Court for final determination.
Although the conclusion was that the statutory duty of the Shire under s 40 had not been breached, this was only because there was no causal connection between the breach and the incident, meaning that had the inspection occurred within the period prescribed in the Plan, and had the Lip been detected, no measures would likely have been taken by the Shire between the date of inspection and the date of the incident.
What is important to note is that it was sufficient to preclude reliance on all of the available statutory defences that the Shire had failed to inspect the relevant footpath within the 18 month window, by a period of only two days. This decision should act as a caution to all road authorities, encouraging strict adherence to any adopted road management plan or policy.
- If a council has a road management plan, it must be fully compliant with all aspects of it.
- If a council does not have a road management plan but has established policies or procedures for the inspection, maintenance and repair of its roads, these will set the standard the council is expected to meet.
- If there is a road management plan or policies/procedures in place, the council must strictly comply with them. If this is done, the council will have the benefit of the statutory defences.
- If a council has no plan and no relevant policies and procedures, it will be liable if it has been negligent.