Factual Background

Discuss about the Business Law for Caparo Industries pIc v Dickman.

Tame v New South Wales (2002) 211 CLR 317 is amongst the leading cases of Australia when it comes to the obligation which one person owes to another based on negligence and the resultant contravention which lead to psychiatric injuries. This case saw the plaintiff making a claim of negligence against the law enforcement officer, in addition to the defamation as a result of the clerical mistake which the police undertook while the accident report was being filed. Upon the appeal being made against the police by the plaintiff based on the undertaken negligence of police in resulting in her psychiatric condition, the High Court rejected the appeal of the plaintiff. In this report, the police had wrongfully stated that blood alcohol level of Tame as .14 but this was actually the alcohol level of the other driver. And it was claimed by Tame that due to this, she felt that no one respected her and this is the reason why she developed the psychiatric state (Sappideen, 2009). Through the discussion being carried here, the case has been detailed where the issues and arguments presented by both the parties have been stated and the decision of the court has been critically analysed.

Tame in this case was involved in a collision of motor vehicles which took place on 11 Jan 1991 at Richmond, in Sydney. The accident occurred due to the fault of the other driver, Terence Lavender. After the accident, the law enforcement officers checked his blood alcohol level and it stood at .14, whereas the blood alcohol of Tame was 0 when the reading was taken (Federation Press, 2017).

Constable Morgan was responsible for preparing the traffic collision report and he was a part of the Windsor Police Station. While preparing this report at the incident spot, he left the blood alcohol reading details of both Tame and the other driver as blank. In Feb 1991, the then acting traffic sergeant filled these blank segments and while filing, accidently switched the blood alcohol of both the drivers, where the other driver was stated to have 0 alcohol level and Tame to have .14 as the blood alcohol level. In around Mar 1991, the mistake was detected by the acting sergeant and he made corrections to the original report at this time (Health Law Central, 2017).

Issues and Arguments of the Parties

Lavender was sued by Tame since he was driving a vehicle which was not insured as was required by the law and this claim was handled by NZI, which was the insurance company. Upon the settlement of the claim, Tame was awarded a significant value. However, come May 1992, the insurance company became hesitant when it came to payment of the physiotherapy treatment which was needed by Tame as a result of her injuries and this made Tame very anxious. The attorney of Tame, Wellers, was informed by Tame that she had no history of drinking and that she had no current drinking issues since the last 20 years. The attorney was also informed that the notion of being drunk was so wrong that she was horrified of it. This reaction of Tame was highlighted upon Weller informing her that the report showed that Tame had been drunk when the accident took place. And Tame was very apprehensive about her reputation which would be damaged as a result of the grave error. The police issued a formal apology to Tame for their mistake; and still Tame continued to blame the law enforcement for the NZI being reluctant in their payments for her treatment. After some time, Tame became obsessed with this issue and was clinically diagnosed with the “psychotic depressive illness”. As a result of this, a claim was initiated by Tame in the NSW District Court against the police (Federation Press, 2017).

Tame in this case, blamed her psychiatric injury as being resulted from the negligence of the police law enforcement officer where they failed in properly stating down her blood alcohol level in the accident report. This in turn, as per the plaintiff, led to the apprehensions on part of NZI in making the payment for her treatment. And it also resulted in her reputation being tarnished as she had been sober since last 20 years. She claimed that the police officer owed her a duty of care to properly state the right facts in the report and by not doing so, the duty of care owed towards her was breached as this breach of duty resulted in her psychiatric injury.

The defendant highlighted that they had already issued a formal apology to Tame. They also stated that the claim of defamation being cited by the plaintiff was out-rightly wrong. This was due to the fact that for a claim of defamation to be upheld, it has to be shown that the careless misstatement of the defendant was relied upon by a third party. Here, it was very clear that no one had made reliance over this careless misstatement of the police officer. This can be proved from the fact that plaintiff had no evidence for this to have occurred. And also from the fact that the insurance company had considered the changed report which had been made by the police after the careless misstatement was noticed and corrected upon. So, even the insurance company had not made reliance on the police officer’s careless misstatement (HCA, 2017).

The plaintiff also made an argument that the police officer had been negligent in the report which had been prepared by them and this was the reason why she developed a psychiatric condition. In this regard, the defendant highlighted that for making a successful case of negligence, one has to establish certain elements (Harvey and Marston, 2009). These include foreseeability, duty, its breach, resulting harm, direct causation and remoteness of losses (Gibson and Fraser, 2014).  In this regard, the defendant cited Caparo Industries plc v Dickman [1990] 2 AC 605 for establishing that a duty of care was never owed by the defendant to Tame (E-Law Resources, 2017). This test requires proximity between parties, justness of penalties, along with the risk of harm to be reasonably foreseeable, for showing that a duty had been owed (Lunney and Oliphant, 2013).

The defendant highlighted that this case did had proximity between the parties. Also, there was a clear lack of reasonable foreseeability in this matter. This was because no one could have predicted that if an accident report had been filled wrongly, the consequence of it would be a psychiatric injury and to state this as being reasonably foreseeable would be completely wrong. Hence, in case penalties are imposed over the defendant for these reasons, these would not be deemed as just or as being reasonable. So the threefold test given under Caparo could not be satisfied by the plaintiff, which means that no duty of care was owed by the defendant towards her (Australasian Legal Information Institute, 2017).

The defendant also relied upon the famous English case when it came to the question of owed duty of care and foreseeability of losses and this was the case of Donoghue v Stevenson [1932] UKHL 100. In this case, the manufacturer was made liable towards the plaintiff for the breach of duty of care as a result of dead snail found in the manufactured ginger beer bottle (Latimer, 2012). However, the defendant stated that in the quoted case, the contaminated bottle was bound to injure the plaintiff, but here, the police officer could not have foreseen that wrongly stating the blood alcohol level would give someone a psychiatric injury (HCA, 2017). Reference also had to be made to Jaensch v Coffey [1984] HCA 52, where the requirement was to establish a relationship for duty to be present (Swarb, 2015). Even though there was a relationship, but it was not which resulted in the police officer being liable for psychiatric injury of the plaintiff.

Another key point of this case was regarding the duty of care which was cited by Tame as being a general public member. In this regard, the defendant presented that it was very true that the police officers owe a duty of care towards the citizens; however, the duty which they owed towards Tame was to safeguard her from a possible criminal activity and this duty of care was not meant to protect Tame from a psychiatric injury since this was not their duty and also because the same was not related to the undertaken error (North, 2017). Yes, there had been an error as was accepted by the defendant but it was not related to the psychiatric injury of Tame since there was a sheer lack of correlation between the undertaken error and Tame’s psychiatric condition. Even though the injury was of substantial nature and damages would have been awarded, but that would have been the case only when the duty of care and foreseeability had been present, which was not the case (HCA, 2017).

The appeal made by Tame in this case had been rejected by the High Court because they agreed with the points raised by the defendant where they could not predicted in a reasonable manner that by a wrong filing of form, a person could become mentally ill and this foreseeability was not only for the police, but for any prudent person (Vines, Roque and Rumber, 2010). In the view of the judges, the case of Donoghue v Stevenson helped in this regard, particularly when it came to the presence of duty of care and the reasonable foreseeability of the injury. The police officers, as per the High Court, did not have such an obligation of care which required them to prevent Tame from distress as a result of the wrongly filled report. The reason for this was given by the High Court as the case where the police officers if are made to check the emotional distress being caused to another person as a result of filing of report, then they would not be able to file an honest report as reports can offend even a rule breaker. Hence, the police could not be made liable for foreseeing the mental health of Tame when they were filing the alcohol report (HCA, 2017).

The court also stated that the damages were to be awarded only in such cases where there had been a recognized psychiatric injury and one cannot be given these when there has been a distress caused to such person (Handford, 2017). For the Tame’s case, there was a lack of special relationship which could have made the law enforcement officer liable based on the case of Donoghue v Stevenson. The duty of care which is subjected to investigation would conflict with the duty of a police officer being in their position. And so, the police officers had to keep the duty as being a police officer before anything else (HCA, 2017).

McHugh J viewed the obligation of care as something which would be owed only in cases of a nervous shock or psychiatric injury being foreseeable to a normal fortitude of an individual (Richardson, 2017). The injury, to be reasonably foreseeable, had to conform to the neighbour principle and reasonableness had to be given supremacy. This led to the court concluding that a duty of care was not owed by the police officers towards tame due to conflicting duties and the lack of foreseeability being reasonable. And so, a psychiatric injury could not be made successful (Webstroke Law, 2017).

The decision given in this case had been correct as the police officers could not be made liable for something which could not reasonably be foreseen. Also, the case made by defendant was very strong as they highlighted different cases to prove their point. The defendant had already apologized for wrongly filing a report and blaming them for a mistake, which has been corrected and which has shown to not have impacted the insurance company’s payments. Hence, the court had rightly ruled in the favour of the defendant in this case.

References

Australasian Legal Information Institute. (2017) Tame v New South Wales [2002] HCA 35; 211 CLR 317; 191 ALR 449; 76 ALJR 1348 (5 September 2002). [Online] Australasian Legal Information Institute. Available from: https://www.austlii.edu.au/au/cases/cth/HCA/2002/35.html [Accessed on: 03/10/17]

E-Law Resources. (2017) Caparo Industries pIc v Dickman [1990] 2 AC 605 House of Lords. [Online] E-Law Resources. Available from: https://www.healthlawcentral.com/cases/tame-v-new-south-wales/ [Accessed on: 03/10/17]

Federation Press. (2017) Tame v New South Wales Annetts v Australian Stations Pty Ltd. [Online] Federation Press. Available from: https://www.federationpress.com.au/pdf/Tame%20v%20New%20South%20Wales.pdf [Accessed on: 03/10/17]

Gibson, A., and Fraser, D. (2014) Business Law 2014. 8^th ed. Melbourne: Pearson Education Australia.

Handford, P. (2017) Psychiatric injury: the new era. [Online] The University of Western Australia. Available from: https://research-repository.uwa.edu.au/files/1003225/3609_PID3609.pdf [Accessed on: 03/10/17]

Harvey, B., and Marston, J. (2009) Cases and Commentary on Tort. 6^th ed. New York: Oxford University Press.

HCA. (2017) Tame v New South Wales [2002] HCA 35. [Online] HCA. Available from: https://eresources.hcourt.gov.au/downloadPdf/2002/HCA/35 [Accessed on: 03/10/17]

Health Law Central. (2017) Tame v New South Wales; Annetts v Australian Stations Pty Limited [2002] HCA 35. [Online] Health Law Central. Available from: https://www.healthlawcentral.com/cases/tame-v-new-south-wales/ [Accessed on: 03/10/17]

Latimer, P. (2012) Australian Business Law 2012. 31^st ed. Sydney, NSW: CCH Australia Limited.

Lunney, M., and Oliphant, K. (2013) Tort Law: Text and Materials. 5^th ed. Oxford: Oxford University Press.

North, D.O.J. (2017) Personal Injury Claims – Psychiatric Injury. [Online] Bar Web. Available from: https://portal.barweb.com.au/upload/fck/north%20sc%20-%20pi%20claims.pdf [Accessed on: 03/10/17]

Richardson, B. (2017) Nervous shock in the High Court. [Online] Find Law. Available from: https://www.findlaw.com.au/articles/1364/nervous-shock-in-the-high-court.aspx [Accessed on: 03/10/17]

Sappideen, C., at al. (2009) Torts, Commentary and Materials. 10^th ed. Pyrmont: Lawbook Co, pp. 209-10.

Swarb. (2015) Jaensch v Coffey; 20 Aug 1984. [Online] Swarb. Available from: https://swarb.co.uk/jaensch-v-coffey-20-aug-1984/ [Accessed on: 03/10/17]

Vines, P., Roque, M.S., and Rumber, E. (2010) Is “nervous shock” still a feminist issue? The duty of care and psychiatric injury in Australia. [Online] Bar Web. Available from: https://sites.thomsonreuters.com.au/journals/files/2010/10/j19_v018_TORTLREV_pt01_vines_sanroque_rumble.pdf [Accessed on: 03/10/17]

Webstroke Law. (2017) Tame v New South Wales [2003]. [Online] Webstroke Law. Available from: https://webstroke.co.uk/law/cases/tame-v-new-south-wales-2003 [Accessed on: 03/10/17]