Western Australia’s Court of Appeal has found the Electricity Networks Corporation (trading as Western Power) liable in negligence in relation to damage caused by the Parkerville bushfire in January 2014. The unanimous decision:
- reversed the trial judge’s decision dismissing the claim against Western Power; and
- materially altered the apportionment of liability between the three defendants. Western Power was apportioned 50% of the liability on appeal.
The decision provides important guidance in determining the approach to whether a public authority owes a duty of care in exercising its statutory powers and functions. It also illustrates that public authorities may owe duties to inspect assets owned by third parties in the exercise of their powers and functions, especially when they have specialised knowledge of potential risks of harm arising.
The Parkerville bushfire
Western Power operates an electricity distribution system in the south-west part of Western Australia. It owns the service cables which deliver electricity to individual customers. In regional areas, the service cable often runs from the nearest network distribution pole across the property boundary to a privately-owned point of attachment pole (PA pole).
The jarrah PA pole which caused the fire was owned by Mrs Campbell and located on her property. It had been in the ground for at least 30 years by the time of the fire. Western Power’s service cable ran from a network distribution pole on the road adjacent to Mrs Campbell’s property. The service cable was the main conductor to distribute electricity from the distribution pole to Mrs Campbell’s PA pole.
Western Power had engaged Thiess as an independent contractor to replace the network distribution pole adjacent to Mrs Campbell’s PA pole in July 2013. This involved removing and replacing the service cable between the network distribution pole and the PA pole. This altered the load on the PA pole during the work. On 12 January 2014, the PA pole fell, igniting a fire.
The issues on appeal: scope and content of Western Power’s duty of care
The appellants challenged the trial judge’s conclusion that Western Power did not owe a duty to make periodic inspections of, and maintain connected assets, including the PA pole, because such a duty was incompatible with the legislative scheme in the Electricity Act 1945 (WA).  Whether a public authority owes a duty of care (and if so, the scope of any duty) in exercising its statutory powers and functions is determined by reference to the provisions in the legislation conferring the functions. Any common law duty must be consistent with the applicable statutory scheme. Generally, statutory powers must be exercised with reasonable care. Damages in negligence may be recoverable if those that exercise the statutory powers could have taken reasonable precautions to prevent an injury which has been, or was likely to be, occasioned by their exercise.
The Court of Appeal held that Western Power:
- Owed a duty of care to persons in the vicinity of its electricity distribution system to take reasonable care to avoid or minimise the risk of injury to those persons, and loss or damage to their property, from the ignition and spread of fire in connection with the delivery of electricity throughout its distribution system; and
- Breached that duty by failing to have a system for undertaking the periodic inspection of wooden point of attachment poles owned by consumers and used to support live electrical apparatus forming part of Western Power’s electricity distribution system.
Section 25 of the Electricity Act
The Court of Appeal rejected Western Power’s contention that s25 of the Electricity Act is an exhaustive statement of the duty of care owed by a network operator to consumers and third parties, which places exclusive responsibility for the maintenance of PA poles on consumers because:
- The alleged duty was not inconsistent with the statutory scheme simply because its discharge extended beyond the steps required by s25 of the Electricity Act.
- A person aggrieved by Western Power’s breach of s25 was authorised to complain to the Minister. This suggests that the provision was designed to give an administrative remedy rather than to exhaustively define common law duties of care.
- The legislative history suggested s25 did not exhaustively define or limit the authority’s legal liability.
- Section 25(1)(a) did impose a duty to inspect and deal with a PA pole when necessary to maintain service apparatus belonging to Western Power in a safe and fit condition for supplying electricity. Western Power’s aerial service cable would not be kept in a fit and safe condition if it is attached to a pole incapable of supporting it, especially when there is a recognised risk of fire if the pole collapses while the service cable is conveying electricity.
- Even if the legislation imposed an exclusive obligation on consumers to maintain their PA poles, the duty owed by Western Power was not inconsistent with that division of responsibility. It was open to Western Power to require a consumer to repair or replace a PA pole if they are to continue to receive electricity through the service cable supported by the PA pole.
The Court of Appeal noted that there are inherent risks to the safety and property of third parties in the operation of an electricity distribution system. Failure of a structure supporting live electrical apparatus will likely result in death or personal injury and property damage within the vicinity. It should not be readily inferred that Parliament intended to authorise Western Power to operate the distribution system carelessly. A common law duty was not inconsistent with the statute.
Breach of duty
The Court of Appeal had to consider whether a reasonable electricity network operator in Western Power’s position would have responded to the risk of harm by fire by establishing a system for undertaking the periodic inspection of wooden power poles used to support its live electrical apparatus (including those owned by third parties). It was common ground that Western Power did not undertake periodic inspections of consumer wooden poles supporting its electrical apparatus. The Court of Appeal held Western Power breached its duty of care for failing to have a system for the periodic inspection of the wooden PA poles supporting its apparatus.
A reasonable operator would have undertaken periodic inspections of wooden poles more than 15 years old, especially in rural areas where there was a greater risk of bushfire. All poles supporting the electrical apparatus would have been inspected, regardless of whether the operator owned the poles. The fact that Western Power undertook periodic inspections of its own poles was evidence that an inspection regime was feasible and allowed the Court to draw interferences about the steps a reasonable operator would take in relation to poles supporting its distribution system.
In assessing the issue of breach, the Court of Appeal observed that:
- The fact that Western Power had a lack of information about the number, age and condition of PA poles supporting its electricity distribution system was not a relevant factor.
- There was no evidence to show that the costs associated with inspecting the PA poles would be disproportionate to the magnitude of the risk of harm that would arise if they failed. The costs incurred in inspecting the PA poles will form part of the costs of Western Power’s broader inspection regime and, if approved, would be capable of being recovered in Western Power’s access prices.
The Court of Appeal found Western Power was responsible for the greatest extent of the plaintiff’s loss. The breach continued for many years, during which it failed to have any system for periodically inspecting PA poles. Western Power appreciated the nature and extent of the danger of the ignition and escape of fire posed by a collapsing PA pole. It also had the greatest knowledge, technical means and resources to deal with the risk. Western Power was apportioned 50% of the liability. While Thiess conducted an inadequate inspection of the PA pole and its work created the opportunity for the deterioration of the pole to be discovered, it had at least conducted an inspection whereas Western Power had conducted none. Its proportion of the liability was reduced from 70% to 35%. Mrs Campbell had no actual knowledge of the relevant risk. A reasonable person in her position would not be expected to know the actual lifespan of a pole. Mrs Campbell also lacked the electrical expertise and resources of Western Power and Thiess. Mrs Campbell’s proportion of the liability was reduced from 30% to 15%.
The Court of Appeal also refused to award damages for physical inconvenience. Two plaintiffs had sought damages for their experience on the day of the fire and in the immediate aftermath, the actual inconvenience caused by not being able to immediately return to their property (and the duration they were unable to return), clean-up, restrictions on the use of the property following the fire, ongoing effect of the fire on the property, its surrounds and the community and whether their plans for the property had been changed by the fire. A number of these claims contained damages for mental distress which were not recoverable. Other heads, such as clean-up, were covered by other heads of damage. The evidence fell short of establishing that the inconvenience was of sufficient significance to justify an award under a separate head of damage.
Herridge highlights that:
- Courts are willing to reformulate a duty of care which is different to the pleadings. In this case, the plaintiff pleaded a duty which required Western Power for having a system for inspecting PA poles and, if a defect was identified, replace or reinforce the PA pole or require the consumer to do so. The fact that the duty as found was different to the pleadings did not preclude the plaintiff from succeeding. The parties had responded to the case as found.
- Courts will be reluctant to construe a statutory power or function conferred on a public authority as confining any common law duty of care in circumstances where an unreasonable exercise of the power or function creates an inherent risk of personal injury or property damage.
- Public authorities’ duties of care may extend beyond maintaining their own assets. Duties may be imposed to inspect assets owned by third parties. Such duties are more likely to arise where the public authority has specialised knowledge about any inherent risks of failure or defects which are unlikely to be known by a reasonable person in the position of the third party.