Supreme Court New South Wales Medium Neutral Citation: Fairfield City Council v Bastow Civil Constructions Pty Ltd [2023] NSWSC 1143 Hearing dates: 7 March 2023 Date of orders: 21 September 2023 Decision date: 21 September 2023 Jurisdiction: Common Law Before: Mitchelmore J Decision: (1) The Summons is dismissed. (2) The parties are to file and serve written submissions on costs of no more than two (2) pages by 4pm on 5 October 2023, with the question of costs to be determined on the papers. Catchwords: STATUTORY INTERPRETATION — Impounding Act 1993 (NSW) (repealed) — whether s 45(3) confers statutory right of action — whether subsection creates exception to statutory extinguishment of right of former owner to sue impounding authority for damages for exercise of power of sale of impounded item TORTS — negligence — duty of care — public authority — whether Civil Liability Act 2002 (NSW), 43A engaged — whether liability based on exercise of special statutory power TORTS — negligence — standard of care — Civil Liability Act 2002 (NSW), s 43A(3) — whether no public authority could properly consider pleaded acts and omissions a reasonable exercise of its power — multiple failures to keep records leading to sale of impounded vehicle TORTS — negligence — Civil Liability Act 2002 (NSW), s 43 — whether s 43 applies to actions in negligence Legislation Cited: Civil Liability Act 2022 (NSW), ss 40, 41, 43, 43A, 44 Civil Liability Amendment Act 2003 (NSW) Impounding Act 1993 (NSW) (repealed), ss 15, 16, 17, 18, 20, 23, 24, 25, 27, 45 Local Court Act 2007 (NSW), ss 39, 40 Cases Cited: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41 Baker v Australian Asbestos Insulations Pty Ltd (1985) 3 NSWLR 280 Bankstown City Council v Zraika; Roads and Maritime Services v Zraika (2016) 94 NSWLR 159; [2016] NSWCA 51 Collins v Clarence Valley Council (2015) 91 NSWLR 128; [2015] NSWCA 263 Curtis v Harden Shire Council (2014) 88 NSWLR 10; [2014] NSWCA 314 Della Franca v Lorenzato; Burwood Council v Lorenzato [2021] NSWCA 321 Doyle's Farm Produce Pty Ltd v Murray-Darling Basin Authority (No 2) (2021) 106 NSWLR 41; [2021] NSWCA 246 Gales Holdings Pty Ltd v Tweed Shire Council (2013) 85 NSWLR 514; [2013] NSWCA 382 Hunter Area Health Service v Presland (2005) 63 NSWLR 22; [2005] NSWCA 33 Precision Products (NSW) Pty Ltd v Hawkesbury City Council (2008) 74 NSWLR 102; [2008] NSWCA 278 Presland v Hunter Area Health Service [2003] NSWSC 754 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd (2009) 77 NSWLR 360; [2009] NSWCA 263 SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362; [2017] HCA 34 Watches of Switzerland Pty Ltd v Transport for NSW [2018] NSWSC 1256 Weber v Greater Hume Shire Council (2019) 100 NSWLR 1; [2019] NSWCA 74 Category: Principal judgment Parties: Fairfield City Council (Plaintiff) Bastow Civil Constructions Pty Ltd (Defendant) Representation: Counsel: Mr E P Anderson (Plaintiff) Mr S Jayasuriya (Defendant) Solicitors: McCulloch & Buggy (Plaintiff) Greenwood Lawyers (Defendant) File Number(s): 2022/261962 Publication restriction: Nil Decision under appeal Court or tribunal: Local Court of NSW Jurisdiction: Civil Citation: N/A Date of Decision: 5 August 2022 Before: Atkinson LCM File Number(s): 2020/362011 Judgment 1. HER HONOUR: The plaintiff, Bastow Civil Constructions Pty Ltd (Bastow), is a civil works company based in Queensland and operating partly in New South Wales. The defendant is Fairfield City Council (Council). The proceedings arise from the Council having impounded a truck owned by Bastow, and subsequently selling the truck at auction. Before the truck was sold, Bastow approached the Council a number of times to recover the truck. Those approaches should have been, but were not, recorded in the Council's Customer Request Management System (CRM). 2. If the Council officers within the section of the Council responsible for selling and/or disposing of impounded items had known about Bastow's approaches, they would not have proceeded to sell the truck. In the absence of any record in the CRM, however, those officers were not aware that Bastow was attempting to recover the truck; and the truck was sold at auction, for a price that Bastow contended was far less than its market value. 3. Bastow brought proceedings in the Local Court for damages, claiming the difference between the market value of the truck and the sale price. Bastow put its claim on two bases. It claimed that the Council owed a statutory duty to act with reasonable care in respect of the sale of the truck pursuant to s 45(3) of the Impounding Act 1993 (NSW) (repealed), and breached that duty. It also claimed in the alternative that the Council was liable in negligence. 4. The Magistrate held that the Council owed Bastow a statutory duty pursuant to s 45(3) of the Impounding Act and had breached that duty. Her Honour also accepted that Bastow had established the elements of negligence, but dismissed the claim on the basis that the Council was protected by what her Honour described as the "defences" in s 43 and s 43A of the Civil Liability Act 2002 (NSW). Her Honour gave judgment for Bastow in the amount of $46,500. 5. The Council has brought the present proceedings pursuant to s 39(1) of the Local Court Act 2007 (NSW), by which a party to proceedings before the Local Court who is dissatisfied with a judgment or order of the Court may appeal as of right to the Supreme Court but only on a question of law, and otherwise with leave (s 40). The Council contends that s 45(3) of the Impounding Act does not create a cause of action and the Magistrate erred in concluding to the contrary. Further, it was necessary for the Act to confer a cause of action on a person in Bastow's position, and there was no such conferral (Grounds 1-4). The Council contends that the Magistrate erred in finding that damages can be awarded under the Impounding Act (Ground 5). Finally, the Council contends that the Magistrate erred by failing to consider whether it had a complete "defence" to Bastow's claim under the Impounding Act pursuant to ss 43 and/or 43A of the Civil Liability Act (Grounds 6-7). 6. Bastow has, in turn, filed a notice of contention which takes issue with the Magistrate's conclusions on the negligence claim. Bastow contends that the Magistrate erred in her approach to, and application of, ss 43 and s 43A of the Civil Liability Act (Grounds 1-2 and 5). In effect, Bastow contends that on the facts as found, it was not open to her Honour to conclude that either section was engaged: s 43 did not apply to actions in negligence, and s 43A did not apply because the liability Bastow alleged was not based on the exercise of, or failure to exercise, a special statutory power. Alternatively, if either provision applied, the acts and omissions of the Council were unreasonable in the manner for which s 43(2) and s 43A(3) respectively provide (Grounds 4, 6 and 8). Bastow also took issue with the adequacy of her Honour's reasons in respect of the applicability of both provisions (Grounds 3 and 7). 7. On the Council's appeal, I accept the Council's contention that s 45(3) of the Impounding Act does not create a cause of action and the Magistrate erred in concluding to the contrary. However, the provision does create an exception to the statutory extinguishment, in s 45(2), of an entitlement on the part of an owner to sue for damages; and on the Magistrate's findings that exception applied. Accordingly, Bastow could bring an action in negligence against the Council. 8. As to Bastow's notice of contention, s 43 of the Civil Liability Act did not apply to the negligence claim, as that action was not one for breach of a statutory duty. Contrary to Bastow's contention, s 43A of the Civil Liability Act applied in the present case. However, the Magistrate erred in concluding that in the circumstances of the present case the exception to the exclusion of liability, in s 43A(3), was not satisfied. It follows that the I would uphold the Magistrate's order giving judgment for Bastow, albeit on the basis of negligence and not breach of statutory duty. The Council's Summons, which sought to set aside the judgment of the Magistrate and instead give judgment for the Council, should be dismissed. Evidence 1. The Council read an affidavit of its instructing solicitor, Ms Katherine Joy, sworn on 31 October 2022, which exhibited the Magistrate's orders and reasons, the transcript of the hearing before her Honour, and the Council's written submissions below. Bastow read an affidavit of its instructing solicitor, Mr Sean Thomas Greenwood, sworn on 23 November 2022, which exhibited the Further Amended Statement of Claim and the written submissions it filed in the Local Court. The Council's Defence to the Further Amended Statement of Claim was also in evidence. Background to the decision of the Magistrate 1. The Magistrate set out the background of the matter at [5]-[57] of her Honour's reasons, from which I have adopted the following summary. 2. Bastow carried on a business that included horizontal directional drilling for laying cables and pipe work. In around 2007, it purchased a second-hand truck for approximately $97,000. Bastow used the truck in its business until 2018. During that time, Bastow fitted the truck with a hook lift and regularly serviced the vehicle. The truck was unaffected by major defects and did not break down at any stage: [6]. 3. In June 2019, Jason Bastow, the director of Bastow, listed the truck for sale online: [9]. It did not sell, with a number of prospective buyers indicating that they wanted the truck to have a current "brown slip" (the equivalent of a "pink slip" for cars) and to be re-registered: [10]. In about October 2019, Mr Bastow took the truck to GB Truck Centre in Smithfield to get a brown slip, leaving the truck there and returning to Queensland where he was based: [11]. 4. GB Truck Centre was owned by Gurvinder (Jack) Singh. Mr Singh carried out the brown slip inspection on the truck, finding it in good condition apart from needing some new tyres. After issuing the brown slip, Mr Singh called Mr Bastow and told him that the truck was ready for collection. Mr Bastow said that he would collect the truck when he had the chance. In the meantime, as Mr Singh did not have space in his workshop to store the truck, he parked it at the end of a nearby cul-de-sac in Smithfield: [13]. 5. In about September 2019, an officer of the Council, Raed Salti, first noticed the truck in the cul-de-sac and observed that it had some flat tyres: [42]. He returned a couple of weeks later and marked the tyres. On or about 26 October 2019, Mr Salti returned again and noted that the truck had not moved. He decided to proceed with a preliminary investigation and placed a notice to impound motor vehicle sticker on the front driver's side window: [43]. 6. Mr Salti created a record on the Council's CRM in relation to the truck. Having searched the vehicle registration database, he caused a notice of intention to impound to be sent to Bastow's last known address: [44]-[45]. Although the letter was recorded on the CRM as having been sent on 28 October 2019, Mr Bastow and his wife maintained that they never received it: [38], [46]. 7. On 13 November 2019, Mr Salti returned to the location of the truck and took photos of it. On 28 November 2019, he issued a penalty notice to Bastow for abandoning the truck: [47]. These actions were also recorded on the CRM: [48]. 8. On 2 December 2019, having obtained and approved a quote to cart the truck to the Council's impound lot, a further letter was sent to Bastow's last known address, advising that the truck had been impounded and that it would be disposed of unless it was reclaimed and removed from the Council's compound within 28 days. The CRM recorded that the letter had been sent: [49]-[50]. Mr Bastow and his wife maintained that they did not receive this letter: [38]. 9. On 22 January 2020, the truck was sold at auction. The tax invoice from the auction house to the Council, which was referred to on the CRM, noted that the net proceeds of the sale were $7,133.64 (ex GST): [51]. 10. Relevantly to the appeal, there was a significant factual dispute between Bastow and the Council as to the events that occurred between Mr Salti impounding the truck and the sale of the truck at auction. Bastow's evidence, which was given by Mr Bastow, his wife, Janelle Bastow, and Mr Singh was as follows: 1. On or about 28 November 2019, Mr Singh noticed that the truck was no longer parked on the street where he had left it. He telephoned Mr Bastow about this and suggested that he report the truck stolen or check with the Council to see if it had towed the truck: [16]. 2. Mr Bastow told his wife about the call from Mr Singh the same day, following which Ms Bastow rang the Council. Ms Bastow could not recall with whom she spoke, but she did recall being told that the truck had been towed because it was abandoned. Ms Bastow was also told that the truck would be released if someone attended the Council offices with proof of ownership and paid a fee of $450 plus GST: [17]-[21]. 3. At the request of Mr Bastow, Mr Singh then attended the Council offices. He was told he needed proof of ownership of the truck before the Council could speak to him about it: [22]-[23]. 4. On 16 December 2019, Ms Bastow sent an email to Mr Singh attaching a copy of the registration papers for the truck: [25]. Mr Singh again attended the Council offices and spoke to another employee, who told him that he would have to speak to Mohammed Dannaoui, the manager of Community Regulatory Services for the Council at the time, but he was in a meeting. Mr Singh left his details with the employee and asked that Mr Dannaoui call him. Mr Singh never received a call from Mr Dannaoui: [26]. 5. Mr Singh attended the Council on at least two occasions between around 23 December 2019 and 2 January 2020 but the offices were closed: [26]. 6. On around 7 January 2020, Mr Singh again attended the Council and spoke to another employee, who told him that he would also need proof that he was authorised to act on behalf of the company. Mr Singh relayed this to Mr Bastow: [27]. 7. At about midday that same day, Ms Bastow called the Council and spoke to a person named Vicky, who told her that she could not find any information on the system regarding the truck but would make some enquiries: [28]. Later that day, Ms Bastow received a Voice2Text message on her phone from Vicky, stating that she had spoken to someone and the Council required "proof of your company": [29]. 8. Later the same day, Ms Bastow sent an email to Mr Singh, attaching a letter authorising the Council to release the truck to Mr Singh and another copy of the registration papers and directing him to take the material to the Council and ask for Vicky: [31]-[32]. Mr Singh did as Ms Bastow had directed, and gave evidence that he and Vicky had a conversation in which she told him he would need to speak to Mr Dannaoui. As Mr Dannaoui was in a meeting, Vicky gave Mr Singh a "with compliments" slip on which Mr Dannaoui's contact details were written: [33]. 9. Mr Singh tried to contact Mr Dannaoui on a number of occasions, without success. He also spoke to Mr Salti around that time and was advised that he needed to speak to Mr Dannaoui about collecting the truck: [34]. 10. Mr Singh called Mr Bastow and gave him an update. Mr Bastow told him he would need to drive down from Queensland: [35]. On or about 20 February 2020, Mr Bastow and Mr Singh attended the Council offices and met with Mr Dannaoui, who told them that the truck had been sold. Relevantly, Mr Dannaoui said words to the effect that if anybody had contacted the Council about the truck (which he disputed), he would have held on to it until it was sorted out. Mr Bastow and Mr Singh disputed that no one had contacted the Council: [36]. Bastow's pleaded claims 1. Given the issues raised in the appeal, it is necessary to set out Bastow's pleaded case with some precision. As I have noted above, in its Further Amended Statement of Claim (FASOC), Bastow sought damages on two alternative bases (it abandoned a claim in conversion on the first day of the hearing). First, Bastow contended that the Council owed it "a statutory duty to act with reasonable care in respect of the sale of the truck". It particularised this duty by citing s 45(3) of the Impounding Act: FASOC [3A]. In alleging that the Council breached this duty (FASOC [3B]), Bastow relied on the following: 1. its approaches to the Council between November 2019 and January 2020, to make enquiries about having the truck released or procuring its release: FASOC [3A1]; 2. the policy of the Council to record bona fide enquiries about an impounded vehicle, or attempts to recover such a vehicle, in writing in the CRM (defined as the "Internal Policy"): FASOC [3A2]; and 3. the failure of the Council to record any of the approaches that it made about the truck in the CRM: FASOC [3A3] and [3A4]. 1. Bastow alleged that as a result of the Council not recording any of its approaches about the truck, "and breaching the Internal Policy as a consequence", the Council acted without reasonable care, as a result of which it procured the sale of the truck at auction: FASOC [3A5] and [3A6]. As a result of the sale of the truck, Bastow lost ownership and suffered loss and damage: FASOC [3C] and [3D]. 2. Secondly, Bastow alleged that "pursuant to the Civil Liability Act 2002 (NSW) [the Council] owed [Bastow] a duty to take reasonable precautions against the risk of it selling an impounded vehicle belonging to an owner, which the owner was trying to recover": FASOC [3E]. In the particulars to that paragraph Bastow contended that the duty was to be "inferred by s 45(3) of the Impounding Act", although it was ultimately put as an action in common law negligence. The allegation that the Council failed to take precautions against that risk of harm relied on the same conduct that Bastow pleaded in its breach of statutory duty claim: FASOC [3E1]. Bastow pleaded that a reasonable person in the Council's position would have taken precautions in the form of recording its approaches in the CRM. Bastow then pleaded (FASOC [3G]): "Further or in the alternative, the defendant's decision to sell the Truck was, in the circumstances, so unreasonable that no authority could have properly considered its sale of the Truck to be a reasonable exercise of its statutory power." 1. As will shortly become apparent, the language of that allegation reflects the terms of s 43A(3) of the Civil Liability Act. Again, by way of particulars to that allegation, Bastow relied on the same conduct that it pleaded in its breach of statutory duty claim: FASOC [3A1]-[3A.5]. 2. In its Defence to the FASOC (Defence), the Council pleaded that the proceedings were for civil liability based on its alleged breach of a statutory duty in connection with the exercise of or a failure to exercise a function for the purposes of s 43 of the Civil Liability Act. If any acts or omissions were found on its part as pleaded or otherwise, they were not in the circumstances so unreasonable that no authority having the functions of the authority in question could properly consider the act or omission to be a reasonable exercise of its functions: Defence [13]. 3. The Council also pleaded that s 43A of the Civil Liability Act applied. It alleged that the power to "impound and/or release" the truck was a special statutory power within the meaning of s 43A(2) "because it derives from the defendant's power further to sec. 5, 15, 16 and 24 of the Act", being the Impounding Act: Defence [14(d)]. The Council further pleaded that any allegation that it should not have released and/or not disposed of the truck was "based on an alleged liability arising from [its] exercise of, or failure to exercise, a 'special statutory power' conferred upon [it]": Defence [14I]. If any acts or omissions were found on its part, they were not in the circumstances so unreasonable that no authority having the special statutory power in question could properly consider the act or omission to be a reasonable exercise of its functions: Defence [14(g)]. Applicable legislative provisions 1. The claim in negligence involved the provisions of the Civil Liability Act. For the purposes of the appeal, the significant provisions of the Civil Liability Act are ss 43 and 43A, which are contained in Part 5 of the Act. Part 5 applies "to civil liability in tort" (s 40(1)) and its provisions are directed to the liability of "a public or other authority", the definition of which includes a local Council: s 41. 2. Section 43 of the Civil Liability Act provides: 43 Proceedings against public or other authorities based on breach of statutory duty (1) This section applies to proceedings for civil liability to which this Part applies to the extent that the liability is based on a breach of a statutory duty by a public or other authority in connection with the exercise of or a failure to exercise a function of the authority. (2) For the purposes of any such proceedings, an act or omission of the authority does not constitute a breach of statutory duty unless the act or omission was in the circumstances so unreasonable that no authority having the functions of the authority in question could properly consider the act or omission to be a reasonable exercise of its functions. (3) In the case of a function of a public or other authority to prohibit or regulate an activity, this section applies in addition to section 44. 1. Section 43A of the Civil Liability Act provides: 43A Proceedings against public or other authorities for the exercise of special statutory powers (1) This section applies to proceedings for civil liability to which this Part applies to the extent that the liability is based on a public or other authority's exercise of, or failure to exercise, a special statutory power conferred on the authority. (2) A special statutory power is a power— (a) that is conferred by or under a statute, and (b) that is of a kind that persons generally are not authorised to exercise without specific statutory authority. (3) For the purposes of any such proceedings, any act or omission involving an exercise of, or failure to exercise, a special statutory power does not give rise to civil liability unless the act or omission was in the circumstances so unreasonable that no authority having the special statutory power in question could properly consider the act or omission to be a reasonable exercise of, or failure to exercise, its power. (4) In the case of a special statutory power of a public or other authority to prohibit or regulate an activity, this section applies in addition to section 44. 1. The statute that was said to be relevant to the operation of ss 43 and 43A in the present case was the Impounding Act, which was repealed with effect from 1 November 2022: see Public Spaces (Unattended Property) Act 2021 (NSW), s 62. Bastow separately relied on breach of s 45 of the Impounding Act as grounding its claim for damages. 2. By way of broad overview, the Impounding Act makes provision for the impounding of animals and articles. An "article" is defined in the Dictionary in a manner that includes a motor vehicle but excludes any living creature (the term "animal" is separately defined). The term "item" is defined in the Dictionary to include both an animal and an article as those terms are respectively defined. 3. Section 15 of the Impounding Act provides that an impounding officer may impound an article found in the officer's area of operations if the officer believes on reasonable grounds that the article has been abandoned or left unattended. In the case of a motor vehicle, an impounding officer must make all reasonable enquiries to find out the name and address of the owner before the officer impounds the vehicle; and, if the enquiries reveal the owner's name and address, is not to impound the vehicle until notice of the proposed impounding has been given to the owner and the period specified in the notice has elapsed: s 16. 4. An impounding officer must have the impounded article delivered to a pound as soon as practicable after it is impounded: s 17(1). Pursuant to s 18 of the Impounding Act, an impounding officer may cause an impounded motor vehicle to be destroyed or disposed of as soon as it is impounded "if the impounding officer believes on reasonable grounds that the value of the vehicle is less than $500…". Otherwise, notice of the impounding must be given to the owner of the impounded item as soon as practicable: s 20(3). In the case of a motor vehicle, the impounding officer must also search the Personal Property Securities Register for any security interests in the vehicle and, if there are such interests, must cause notice of the impounding to be given to the person claiming the interest: ss 20(1), 20(4). The notice must clearly indicate that the item has been impounded and will be sold or otherwise disposed of if not claimed within 28 days: s 20(5). 5. At any time before the impounded item is sold or disposed of, an owner may apply to an impounding authority for its release (s 23(1)), and the authority must release it if the conditions in s 23(2) are satisfied, namely: (a) the authority is satisfied on reasonable grounds that the applicant is the owner of the item, is authorised to claim the item on the owner's behalf or is otherwise entitled to lawful possession of the item, and (b) all fees and charges payable in respect of the impounding, holding and disposing of the item are paid to the impounding authority, and (c) the authority is satisfied that all penalties imposed in connection with the event that gave rise to the impounding have been paid, and (d) the applicant signs a receipt for the release of the item. 1. If the impounded item is not released before the "deadline for release" (relevantly, 28 days from the day on which notice was given to the owner under s 20), an impounding authority must cause it to be offered for sale, by public auction or public tender: s 24(1). The impounding authority holds the net proceeds of sale for the person who was the owner immediately before its sale for a period of 12 months, after which time it may transfer the proceeds to such of its funds as it considers appropriate: s 25. 2. In view of the significance of s 45 of the Impounding Act to these proceedings, I will set the provision out in full: 45 Protections from liability (1) A person who destroys an animal under a power conferred by this Act or who destroys or otherwise disposes of a motor vehicle under section 18 is not liable in damages for any loss that the owner of the animal or motor vehicle or any other person has sustained as a result of that action and nor is any impounding authority that authorised the person, unless it is proved that the person or authority did not act in good faith. (2) If an item is sold or disposed of under a power conferred by this Act, the following provisions apply— • the buyer obtains the ownership of the item, • the item is discharged from any right, interest, trust or obligation to which it was subject immediately before sale, • the person who was the owner of the item immediately before the sale or disposal ceases to have any claim in respect of the item or any right of action in respect of the sale or disposal except as specifically provided by this Act. (3) A person is not prevented from recovering damages from an impounding authority in respect of the sale or disposal of an item if the person establishes that the authority, or the person who effected the sale or disposal, did not act in good faith or acted without reasonable care. The decision of the Magistrate 1. The Magistrate dealt first with Bastow's claim that the Council was liable to it "under s 45(3) [of the Impounding Act] for the value of the truck": [60]. Although her Honour described the position of both parties as proceeding "on the basis that damages can be awarded under s 45" (at [62]), the Council disputed the correctness of that premise in this Court. 2. In answer to Bastow's submission that it had made contact with the Council on seven different occasions to get the truck back, the Council denied that Bastow had ever contacted it about collecting the truck. The Council pointed in this respect to the absence of any entries in the CRM recording the contact of which the Bastows and Mr Singh gave evidence, with officers of the Council, including Mr Dannaoui and Mr Salti, giving evidence that a record would be made in the CRM if someone made enquiries about a vehicle: [64]. After considering the evidence, her Honour was not satisfied that the CRM or the processes that should have been followed "were as failsafe as the witnesses assert": [68]. To the contrary, her Honour found, at [77]: "I am satisfied on the balance of probabilities that the Bastows/Mr Singh did contact the Council and that whoever dealt with them at the Council failed to record the information on the CRM and pass the information onto the necessary people. Given what has been recorded on the CRM, I am satisfied on the balance of probabilities that had the relevant people been made aware of the efforts being made to recover the truck, then they would have taken steps to halt the auction." 1. Accepting that the Council had a system in place to manage the impounding and sale of vehicles, her Honour concluded that "whatever procedures that should have been followed to ensure that enquiries were put through to the appropriate section did not occur": [80]. Her Honour was satisfied that "in this instance, the Council acted without reasonable care in that it failed to ensure that those who were fielding general enquiries knew about the procedures": [81]. It followed that her Honour was satisfied "that Bastow is not prevented from recovering damages arising from the sale of the vehicle": [82]. 2. Turning then to the claim in negligence, the Council had raised a threshold issue to the effect that Bastow could not bring a claim under the Civil Liability Act because of the limitation in the third bullet point in s 45(2) of the Impounding Act: [83]. Her Honour was satisfied that the limitation in that provision did not operate because of her Honour's finding that the Council did not act with reasonable care: [87]. Her Honour referred in that context to the preconditions in "s 43" being satisfied. This was likely a typographical error, and should instead refer to s 45(3) of the Impounding Act, the proper construction of which is in issue on appeal. 3. The Magistrate was satisfied that the Council owed Bastow a duty of care: [94]. In circumstances where the Parliament had given the Council power to deal with abandoned vehicles pursuant to a prescribed process, it was implicit that while that process was taking place the Council would owe a duty of care to owners of impounded vehicles. Her Honour described the duty as being to ensure that owners were not "deprived of the opportunity to recover the vehicles before they are sold": [97]. 4. The risk of harm that her Honour identified was that the Council might sell an impounded vehicle that the owner was trying to recover: [100]. Her Honour found that the identified risk was foreseeable, noting that the Council had sought to address it by keeping a record of any contact made by a person in relation to an impounded vehicle and developing a policy that included a section dealing with applications to obtain the release of an impounded vehicle: [101]-[103]. The risk was also not insignificant: if people other than those in Mr Dannaoui's section of the Council could field enquiries about impounded vehicles, there was a risk that if they did not put an enquiry through or record it on the CRM, Mr Dannaoui's section would have no idea that an owner was trying to recover a vehicle: [108]. 5. The Magistrate was satisfied that a reasonable person would have taken the precautions of ensuring that all enquiries about recovering impounded vehicles were drawn to the attention of Mr Dannaoui's section: [117]. Her Honour was also satisfied that the sale of the truck was directly attributable to the Council's failure to ensure Bastow's enquiries were drawn to the attention of the relevant people: [119]. 6. The Magistrate then turned to what she described as the defences in ss 43 and 43A of the Civil Liability Act. As summarised by her Honour, the Council submitted that s 43 was engaged having regard to [3A] of the FASOC, which pleaded that it owed Bastow a statutory duty to act with reasonable care in relation to the sale of the truck: [133]. It further submitted that s 43A was engaged because the proceedings for civil liability related to "a liability based on a public or other authority's exercise of, or failure to exercise, a special statutory power". As her Honour summarised the Council's submissions, the power was of a kind that persons generally are authorised to exercise without specific statutory authority "(i.e., Councils cannot impound and sell vehicles absent the specific statutory authority)": [133]. 7. Further, the Council submitted that Bastow had not proved that the act of selling the truck was in the circumstances "so unreasonable that no authority having the functions of the authority in question could properly consider the act or omission to be a reasonable exercise of its functions". Pausing here, I note that the language of "functions" is used in s 43(2), not s 43A(3); the latter is formulated by reference to an authority exercising or failing to exercise a special statutory power (rather than functions). There was no evidence as to what a public authority in the Council's position would have done, let alone that it was so unreasonable: [133]. 8. Turning then to Bastow's submissions, her Honour noted that it had submitted that s 43A did not apply because "the Council's specific failure to take reasonable care – which led it to sell the truck despite Bastow's repeated attempts to recover it – was its failure to record any of Bastow's approaches to it in relation to the truck in the CRM log". Although these steps "(that is, making entries in a computer log)" could be said to "involve" a statutory power, they did not rely on a statutory power. Rather, the case involved "a basic and fundamental failure by the Council to act competently and follow its own procedures", for which s 43A(3) offered no protection. In any event, no reasonable authority could have considered it reasonable to sell the truck when Bastow had approached the Council on several different occasions to recover it: [134]. 9. Her Honour had earlier set out passages from a number of authorities the focus of which was the application of s 43A of the Civil Liability Act, including Weber v Greater Hume Shire Council (2019) 100 NSWLR 1; [2019] NSWCA 74 ("Weber") at [44]-[50]; Gales Holdings Pty Ltd v Tweed Shire Council (2013) 85 NSWLR 514; [2013] NSWCA 382 ("Gales") at [195]-[197]; Curtis v Harden Shire Council (2014) 88 NSWLR 10; [2014] NSWCA 314 ("Curtis") at [235]; and Collins v Clarence Valley Council (2015) 91 NSWLR 128; [2015] NSWCA 263 ("Collins") at [166]-[180]: see [128]-[132]. Consistently with the focus of those authorities, the focus of her Honour's reasons was s 43A. Her Honour rejected what she described as Bastow's "narrow characterisation of the statutory power and how it was exercised", stating at [135]: "The evidence needs to be considered as a whole. The Council had been given a statutory power and was using that power to impound and subsequently sell the truck. Its failure to ensure that the person who authorised the sale at auction was made aware [of] the owners [sic] attempts to recover the vehicle is better characterised as a failing within the exercise of its statutory power." 1. Her Honour considered that the policy that the Council developed in recognition of the seriousness of the power it could exercise had "a hole in it", as it "assumed that Mr Dannaoui's section would be told about enquiries from owners about impounded vehicles and that persons within the section would share such information with others in the section". While the "main steps" in the process were recorded in the CRM, there was no mechanism to ensure that the person who ultimately emailed the auction company to authorise the auction, Ms Anita Borgiani, was made aware of owners who had started but not completed the process to recover their vehicle before she authorised the auction: [136]. Her Honour was not satisfied on the balance of probabilities that this omission was, in the circumstances, so unreasonable that no authority having the special statutory power in question could properly consider the omission to be a reasonable failure to exercise its power: [137]. The Council's appeal 1. Council's grounds of appeal were directed to two main issues, namely: 1. whether Bastow had a maintainable cause of action pursuant to or by reason of the Impounding Act (Grounds 1-4); and 2. if so, whether there was a defence to any such claim in the Civil Liability Act (Grounds 6-7). Issue 1: Did the Impounding Act confer a cause of action on Bastow? 1. The Council submitted that nothing in the terms of s 45 of the Impounding Act, or the Act more generally, gave Bastow a cause of action against the Council for breach of statutory duty: PWS [5]-[7]; Tcpt 4.6-8. The Council submitted that s 45(2) of the Impounding Act extinguished any right of action "except as specifically provided by this Act", in the face of which a specific conferral of a right of action under the Act was required. The Council pointed by way of example to the right to recover impounding fees created in s 27 of the Impounding Act and submitted that , by contrast, no such specific conferral was made in s 45(3): PWS [12]; Tcpt 5.10-29. 2. Consistently with that submission, the Council relied on a note to s 24 of the Impounding Act, which described the purpose of s 45 as being to "[provide] protection for people who buy impounded items", rather than to provide any cause of action for persons in the position of Bastow, whose impounded property is sold: Tcpt 4.33-39, 5.5-8. Counsel for the Council also submitted that s 45(3) did not, in its terms, create any basis for a claim to be prosecuted or damages to be awarded: PWS [11], [13]; Tcpt 4.6-16, 29-32. 3. The Council next submitted that even if s 45(3) of the Impounding Act did give rise to a cause of action, on the proper construction of the Act as a whole the only available cause of action was for a breach of statutory duty: PWS [14]. In other words, the Act precluded any cause of action in negligence pursuant to the Civil Liability Act. The Council relied upon what it described as the unambiguous meaning of the words "except as specifically provided by this Act" in s 45(2) of the Impounding Act, which precluded a prospective plaintiff from bringing any claim other than one which was specifically conferred by that Act: Tcpt 6.14-26. That construction was supported, it submitted, by the Magistrate's finding that s 43 of the Civil Liability Act, which is concerned with claims for breach of statutory duty, was engaged: PWS [14]. 4. In respect of Ground 5, the Council submitted that the Magistrate erred in finding that the parties had both proceeded on the basis that damages could be awarded pursuant to s 45 of the Impounding Act: see [62]. The Council denied that it had made any such concession and argued that it had always maintained that no cause of action arose under s 45, and thus no damages were available under that section: PWS [16]-[19]; Tcpt 7.10-34. 5. This ground is discrete and may be dealt with shortly. It is apparent from the transcript of the hearing in the Local Court that the oral submissions advanced on behalf of the Council were consistent with the construction of s 45 for which the Council contended in this Court. The Magistrate erred in concluding to the contrary; and the Council should not be precluded from advancing on appeal the constructional arguments regarding s 45. I did not understand Bastow to contend to the contrary. Construction of 45(3) of the Impounding Act 1. It is well settled that "[t]he starting point for the ascertainment of the meaning of a statutory provision is the text of the statute whilst, at the same time, regard is had to its context and purpose": SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362; [2017] HCA 34 at [14], citing Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 ("Project Blue Sky") at [69]-[71]; and Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41 at [47]. 2. Section 45(1) of the Impounding Act confers protection from liability in damages in relation to particular property, namely, animals or motor vehicles to which s 18 applies. A person who destroys an animal or "otherwise disposes of a motor vehicle under section 18", is not liable for any loss that the owner or any other person has sustained as a result of that action, unless the person did not act in good faith. The same protection is afforded to any impounding authority that authorised the person, subject to the same proviso. 3. Whereas s 45(1) is concerned with particular items, s 45(2) of the Impounding Act applies in relation to an "item" as defined in the Dictionary. The subsection addresses the consequences of the sale or disposal of an item, "under a power conferred by this Act", for: (i) the buyer of the item; (ii) the rights with respect to the item that subsisted before sale; and (iii) the person who was the owner of the item immediately before its sale or disposal. Consistently with the conferral of ownership on the buyer of the item (first bullet point), any pre-existing right, interest, trust or obligation with respect to the item is discharged (second bullet point), and the owner of the item immediately before sale or disposal "ceases to have any claim in respect of the item or any right of action in respect of the sale or disposal except as specifically provided by this Act" (third bullet point). 4. Section 45(3) of the Impounding Act picks up on the latter part of the third bullet point in s 45(2). It is directed at a particular claim, namely, one for damages arising from the sale or disposal of an item, and its purpose is to lift the bar that the third bullet point in s 45(2) otherwise imposes on a person bringing such a claim against an impounding authority. By its terms, a person "is not prevented" from bringing that action provided the person can establish that the impounding authority, or the person who effected the sale or disposal of the item, "did not act in good faith or acted without reasonable care." 5. I accept the Council's submission that s 45(3) of the Impounding Act does not positively confer a statutory right of action. The Magistrate's conclusion to the contrary was not consistent with the terms of the provision or with its statutory purpose. As counsel for Bastow frankly accepted in the hearing before me, s 45(3) operates to protect (relevantly) impounding authorities from actions for damages unless the person who would otherwise have that right of action establishes that an authority acted without good faith or reasonable care: DWS [87]; Tcpt 14.40-50. 6. Although I accept the Council's submissions to that extent, I do not accept its further submission that in the absence of a positive conferral of a right of action, s 45(3) does not create an exception that satisfies the terms of the third bullet point in s 45(2). As I have set out above, the third bullet point in s 45(2) extinguishes any right of action in respect of the sale or disposal of an item "except as specifically provided by this Act". In its terms, s 45(3) specifically provides an exception: a person cannot bring an action for damages against an impounding authority unless the person can establish the absence of good faith or reasonable care. If a person can satisfy that condition, the person can bring a claim for damages. 7. In so far as the Council sought to construe the third bullet point in s 45(2) as requiring the Impounding Act positively to confer a cause of action, that construction does not reflect its terms. Further, as Bastow submitted, s 45(3) would have no work to do if that bullet point is not construed in the manner I have indicated; and nor would s 45(1). A court would not readily infer that Parliament would enact otiose provisions: Baker v Australian Asbestos Insulations Pty Ltd (1985) 3 NSWLR 280 at 289-290. Such an inference would be anathema to the accepted approach to statutory construction by which a court strives to give meaning to every word of a provision: Project Blue Sky at [71]. 8. The Magistrate purported to make an order for damages on the basis that s 45(3) of the Impounding Act created a cause of action. Her Honour erred in so doing. I would also uphold Grounds 1 to 3 of the Summons to the extent that they involved the contention that s 45(3) of the Impounding Act created a statutory duty to act with reasonable care, the breach of which gave rise to damages. Issue 2: Was a "defence" to any such claim contained in the Civil Liability Act? 1. Grounds 6 and 7 of the Summons are formulated on the basis that Bastow had a maintainable cause of action pursuant to s 45(3) of the Impounding Act. For the reasons I have set out above, I do not consider that s 45(3) can be properly construed as conferring such a cause of action. If s 45(3) did confer a statutory duty to take reasonable care, breach of which could sound in damages, s 43 of the Civil Liability Act may have some application. However, it is not necessary to express a concluded view on this issue or these two grounds. Bastow's notice of contention 1. Bastow's notice of contention raises the following issues: 1. Did her Honour's conclusion that s 43 of the Civil Liability Act applied rest on an erroneous construction and/or application of the provision (Grounds 1 and 2)? 2. If the answer to (1) is "no", on the Magistrate's factual findings, was it open to her Honour to conclude that Bastow had not established the condition in s 43(2) of the Civil Liability Act (Ground 4)? 3. Did her Honour's conclusion that s 43A of the Civil Liability Act applied rest on an erroneous construction of the provision (Grounds 5 and 6)? 4. If s 43A applies, did her Honour err in concluding that the unreasonableness condition in s 43A(3) was not satisfied (Grounds 7 and 8)? Issues 1 and 2: Application of s 43 of the Civil Liability Act 1. Bastow submitted that s 43 of the Civil Liability Act did not apply to an action in negligence, relying upon what Leeming JA said in Doyle's Farm Produce Pty Ltd v Murray-Darling Basin Authority (No 2) (2021) 106 NSWLR 41; [2021] NSWCA 246 ("Doyle's Farm Produce") at [39] (Bathurst CJ and Bell P agreeing): "…I think it should now be regarded as settled that s 43 applies only to claims for breach of statutory duty as opposed to actions for negligence. That position was stated in Patsalis v State of New South Wales (2012) 81 NSWLR 742; [2012] NSWCA 307 at [87] (subject to the qualification that the point was not fully argued). It was confirmed in McKenna v Hunter & New England Local Health District [2013] NSWCA 476 at [167], and the fact that an appeal was allowed on a different basis does not detract from the correctness of this aspect of the reasoning. It was again confirmed in Electro Optic Systems Pty Ltd v State of New South Wales (2014) 10 ACTLR 1; [2014] ACTCA 45 at [2], [168]–[174], [713]–[714], where the State conceded that the trial judge erred in relying on the section. ..." 1. The Council, on the other hand, submitted that in circumstances where the negligence claim that Bastow pleaded relied solely on a breach of statutory duty further to the Act, her Honour did not err in applying s 43 of the Civil Liability Act. The Council further submitted that s 43 was engaged by virtue of Bastow having pleaded a breach of statutory duty. 2. The difficulty with the Council's submissions is that the Magistrate addressed ss 43 and 43A of the Civil Liability Act in the part of the reasons in which her Honour was considering Bastow's claim in negligence. After considering the application of ss 5B, 5C, 5D and 5E of the Civil Liability Act, her Honour stated at [123]: "As is apparent from the above discussion, the Council might be found negligent in relation to how it handled the disposal of the impounded truck. However statutory defences operate in relation to public and other authorities and these need to be considered before the Council can be found liable." 1. Although her Honour set out ss 43 and 43A of the Civil Liability Act in this context, the focus of her Honour's summary of the applicable principles was s 43A: [128]-[132]. Apart from extracting s 43, Magistrate made only two references to the section in this part of the reasons, namely: (i) in noting the Council's submission that s 43 was engaged by reason of the allegation in the FASOC that the Council owed Bastow a statutory duty to act with reasonable care in respect of the sale of the truck (at [133]); and (ii) in concluding that Bastow had "failed to prove on the balance of probabilities that there was a breach of statutory duty (s. 43)" (at [138]), a conclusion that does not sit at all well with her Honour's award of damages to Bastow for breach of s 45(3) of the Impounding Act. The limited reasoning on s 43 was the subject of Ground 3 of the notice of contention, but rather than constituting a separate error (which, as the Council submitted, was properly a matter for a cross-appeal) it rather tends to support the conclusion that s 43 was not the subject of close consideration. 2. As was put beyond doubt in Doyle's Farm Produce, s 43 of the Civil Liability Act applies only to claims for breach of statutory duty. It was in respect of such a claim that the Council raised the application of s 43, referring in its written and oral submissions to Bastow's breach of the statutory duty pleaded in [3A] of the FASOC, which related to s 45(3) of the Impounding Act (see [20] above). However, the Magistrate erroneously applied s 43 in considering the negligence claim. The error is apparent from the fact that her Honour concluded that s 43 of the Civil Liability Act applied, yet awarded damages to Bastow on its claim for breach of s 45(3) of the Impounding Act (on the erroneous basis that a statutory duty was thereby created and breached). It follows that Grounds 1 and 2 of the notice of contention should be upheld. However, in circumstances where her Honour did not address the application of ss 43 and 43A separately, my conclusions on Grounds 1 and 2 do not have any practical significance. 3. Issue 2 identified at [63] only arises if the answer to Issue 1 is "no". Accordingly it is unnecessary to consider Issue 2, although given the overlap between the tests in s 43(2) and s 43A(3) the language of the provision may fall for consideration, at least tangentially, in the context of the arguments Bastow advanced on s 43A. I would dismiss Ground 4 of the notice of contention on that basis. Issue 3: the Magistrate's approach to s 43A of the Civil Liability Act Submissions 1. The focus of Bastow's submissions on the notice of contention was s 43A(1), which provides that the section "applies to proceedings for civil liability to which this Part applies to the extent that the liability is based on a public or other authority's exercise of, or failure to exercise, a special statutory power conferred on the authority." Bastow submitted that s 43A(1) required the Court first to identify the basis of its claim for relief in negligence. In its submission, the basis of the claim against the Council was that it "failed to take reasonable precautions against the risk of selling an impounded vehicle belonging to an owner, which the vehicle owner was trying to recover, by failing to act in accordance with its internal policy and record any of Bastow's approaches to it about the Truck in the CRM": DWS [52]. 2. Bastow submitted that, properly understood, that claim was not "based on" the Council's exercise of, or failure to exercise, a special statutory power. Rather, the Council's liability was "based on" its record keeping failures, for which the Council required no statutory authority: DWS [56]. At the hearing, counsel for Bastow accepted that the truck was sold pursuant to the Council's statutory power, and it was the sale that caused the loss, but submitted that it was not the exercise of the statutory power in selling the vehicle that was said to be negligent: Tcpt 21.10-20. 3. Bastow accepted that it could be said that the Council's failure to keep records had a connection with its statutory power to sell abandoned vehicles, but submitted that her Honour had ignored the distinction between liability that was "based on" the exercise of a statutory power and liability "involving" a statutory power: DWS [56]. Instead, her Honour had asked whether the relevant failing fell within the Council's exercise of a specific statutory power, which was the wrong question (Ground 5): Tcpt 21.22ff. Bastow contended that on the facts as her Honour found them, the only reasonably available answer was that its negligence claim was not based on the Council's exercise of a special statutory power (Ground 6). Further, her Honour had not provided adequate reasons to explain how she had reached the contrary conclusion (Ground 7). 4. Bastow next submitted that even if s 43A of the Civil Liability Act applied, the Magistrate erred in finding that the Council's acts or omissions were not so unreasonable that no authority having the special statutory power could properly consider those acts or omissions to be a reasonable exercise of its power (Ground 8). To the extent that this ground involved a question of mixed fact and law, Bastow sought leave to raise it, consistently with s 40 of the Local Court Act. Relying on Curtis, Bastow submitted that the question needed to be considered objectively and it was not necessary for it to lead evidence of what a reasonable council would have done in the circumstances: Tcpt 25.40-26.11. In any event, the Council had led evidence from its officers on which Bastow could rely, to the effect that they would have expected the approaches that were made on behalf of Bastow to have been recorded in the CRM: Tcpt 27.10-13. 5. In response, the Council submitted that the "crux" of Bastow's claim was the Council's conduct in procuring the sale of the truck, referring to FASOC [3A], [3A6] and [3G]: Reply [10]. The sale of the vehicle, which was authorised by s 24 of the Impounding Act, involved the exercise of the special statutory power within the meaning of s 43A(2) of the Civil Liability Act: Reply [11], [13]. Contrary to Bastow's characterisation of its claim as relating solely to record keeping, the Council emphasised that the record keeping only arose as part of the exercise of its statutory powers to impound and sell the truck: Reply [19]-[20]. 6. On the assumption that s 43A was engaged, the Council next submitted that Bastow had the onus of establishing that no reasonable authority, having the special statutory power in question, could properly consider the Council's acts or omissions to be a reasonable exercise of, or failure to exercise, the power. Relying on Collins at [177], the Council submitted that Bastow needed to establish that no public authority considering the issue could place its conduct within the range of opinions as to what might constitute a reasonable act or a reasonable failure to act: Reply [29]. In the absence of evidence from Bastow that outlined what another public authority would do in the same or similar circumstances, it could not discharge that onus: Reply [31]. Consideration 1. The background to the enactment of s 43A was summarised by Allsop P in Precision Products (NSW) Pty Ltd v Hawkesbury City Council (2008) 74 NSWLR 102; [2008] NSWCA 278 ("Precision Products") at [167]-[168] (Beazley and McColl JJA agreeing); see also Doyle's Farm Produce at [79]-[80] (Leeming JA). Allsop P observed in Precision Products that s 43A was inserted pursuant to the Civil Liability Amendment Act 2003 (NSW) in response to the decision in Presland v Hunter Area Health Service [2003] NSWSC 754 ("Presland"). The plaintiff in that case was a psychiatric patient who was released from an institution and proceeded to kill his brother's fiancée. At first instance the plaintiff obtained damages for negligence on the part of the Health Service for releasing him, on the basis that if he had been detained as mentally ill or mentally disordered he would not have killed the victim and suffered the legal consequences of that act. 2. The decision in Presland was overturned on appeal (Hunter Area Health Service v Presland (2005) 63 NSWLR 22; [2005] NSWCA 33). However, the Civil Liability Amendment Act was enacted in advance of the Court of Appeal's decision. In the Second Reading Speech to the Civil Liability Amendment Bill 2003, the Minister for Health described the decision in Presland as having raised "important issues that deserve to be put beyond doubt in legislation": New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 13 November 2003 at 4992-3. The Minister stated: "In a case involving a special statutory power, a public authority will be liable only if its decision is so unreasonable that no public authority having such a power could consider it to be reasonable. It will not affect the exercise of 'operational' functions of agencies, for example, where they are given general functions to provide particular services. The bill makes it clear that this principle covers public authorities as well as individuals, such as psychiatrists in hospitals, who have public official functions." 1. In Precision Products, Allsop P stated that it was "plain" that "the drafter of s 43A was attempting to ameliorate the rigours of the law of negligence": [177]. However, his Honour identified a number of uncertainties in the operation of the section, although they were unnecessary to determine in that case. One such issue was whether s 43A affected the existence or the scope of a duty of care, or whether it constituted a statutory immunity that was engaged at the point of considering whether there is a liability for what would otherwise be a breach of a duty of care, the scope of which was ascertained without consideration of the terms of s 43A: [171]. That issue has been determined in subsequent cases, with s 43A construed as assuming the existence of a duty of care and identifying the standard to be applied in determining breach of that duty: Curtis at [234] and [272]; Bankstown City Council v Zraika; Roads and Maritime Services v Zraika (2016) 94 NSWLR 159; [2016] NSWCA 51 ("Zraika") at [109]; Della Franca v Lorenzato; Burwood Council v Lorenzato [2021] NSWCA 321 at [8], [107], [147]. 2. The approach to s 43A(1) of the Civil Liability Act has arisen for consideration in relatively few cases, none of which is on all fours with the circumstances in the present case. It is necessary to provide some detail regarding those cases so as to understand the development and consideration of the approach to the question of what "based on" entails. 3. In Roads and Traffic Authority of New South Wales v Refrigerated Roadways Pty Ltd (2009) 77 NSWLR 360; [2009] NSWCA 263 ("Refrigerated Roadways"), the respondent brought a claim against the Roads and Traffic Authority (RTA) for damages in negligence, arising from an incident in which persons dropped a large piece of concrete from an overhead bridge that hit the windscreen of a truck and killed the driver. The question was whether the RTA was negligent in failing to erect screens along the sides of a bridge across the F5 freeway which might have prevented a person dropping a large piece of concrete from the bridge. As the RTA had not relied on s 43A at the trial, the Court held that it could not rely on it on appeal: [361]. Nonetheless, Campbell JA (McColl JA and Sackville JA agreeing) held that the liability was not based on a special statutory power. 4. Campbell JA noted that the Statement of Claim did not identify any statutory power or negligence in the exercise of any such power. Rather, the allegations of negligence as particularised included: failing to install a barrier, fence guard or other appropriate structure to prevent things falling or being thrown on to the highway below; failing to properly inspect the area and detect the dangers; and constructing or otherwise allowing a bridge to be constructed without barriers, fencing or guardrails. In so far as the installation of barriers or other structures to prevent things being thrown was concerned, Campbell JA observed that the RTA's ownership of the bridge was sufficient to empower it to erect such structures; and that was not "a power…conferred by or under a statute", but rather a property right: [368]. 5. In circumstances where the plaintiff made no mention of any special statutory power of the RTA in pleading its case, Campbell JA did not see "how that alleged liability could be 'based on' the RTA's exercise of, or failure to exercise, any special statutory power": [374]. In any event, and as a matter of substance, his Honour considered that even if the construction of a structure had required the temporary closure of the bridge, it would not have been negligent to exercise any power to close the bridge, or even to delay exercising a power to close the bridge, which was the basis of the plaintiff's claim. It followed that any civil liability of the RTA would not be "based on … [relevantly] failure to exercise a special statutory power", and thus s 43A would not arise: [375]. 6. In Gales, the application of s 43A was raised in the context of an action for nuisance. The appellant alleged that the respondent Council had been and continued to be guilty of nuisance in causing or allowing stormwater runoff to discharge directly and indirectly onto the appellant's land, and in preventing and obstructing stormwater runoff from passing and flowing away from the land: [4]. The runoff that flowed onto the appellant's land and did not adequately flow away from it caused substantial wetting up, which in turn resulted in the development of a habitat for a protected species, the Wallum froglet: [5]. The Council then imposed a condition on the development consent it granted to the appellant with respect to the land, requiring the appellant to set aside part thereof as a perpetual habitat for the Wallum froglet, significantly diminishing the value of the land: [6]. 7. By way of defence, the respondent Council asserted that in making decisions regarding the development of surrounding land, which included filling in of part of the drainage system, failing to seek and grant approval for construction of additional draining, and approving the construction of a road (Turnock Street) without an accompanying culvert or drainage, it was either exercising or failing to exercise special statutory powers within s 43A of the Civil Liability Act. It further contended that its exercise or failure to exercise those statutory powers was not so unreasonable that no authority having those powers could properly consider the acts or omissions to be a reasonable exercise of, or failure to exercise, its powers: [177]. 8. Emmett JA first rejected the Council's reliance on this and other statutory defences in general terms. His Honour characterised the appellant's claims as being "for nuisance consisting of the channelling of stormwater runoff in quantities and flow that are significantly greater and different from that that would occur if the natural terrain remained": [178]. In his Honour's opinion, the statutory defences (the respondent had also relied on s 45 of the Civil Liability Act) had no application to the actions of the respondent in directing the stormwater runoff onto the land, and it was those actions that constituted the nuisance: [179]. 9. When Emmett JA turned to s 43A, assuming a special statutory power was involved his Honour stated that "the anterior question is whether the proceedings were proceedings for civil liability, in which the liability was 'based on' the Council's exercise of, or failure to exercise, a special statutory power conferred on it": [196]. His Honour observed in this respect that "[a] clear distinction is drawn in the legislation between a liability that is 'based on' the exercise of, or a failure to exercise, a special statutory power, and an act or omission 'involving' an exercise or failure to exercise such a power": [196]. His Honour cited Precision Products at [173] in support of this observation, where Allsop P acknowledged a difference in the language between "based on" and "involving" (albeit in circumstances where his Honour suggested that, read in context, the use of the "involved" in s 43A(3) may have been intended to expand the scope of "based on" in s 43A(1)). 10. In any event, Emmett JA considered that the appellant's claims against the respondent Council were not based on any allegation that the Council failed to exercise a particular statutory power, or that it exercised a particular power negligently or unreasonably. Rather, the appellant was suing in nuisance "in relation to the continuing operation of the Council's stormwater drainage network". In his Honour's opinion, it was "a misconception to suggest that Gales' claim is based on the Council's exercise of any particular statutory power": [197]. Leeming JA agreed, "essentially because the nuisance came about because the Council directed stormwater runoff onto Gales' land", and that conduct was "outside the scope of the statutory defences": [283]. In relation to s 43A, Leeming JA agreed "in particular" that "the civil liability for which Gales contended was not 'based on' Council's exercise or failure to exercise a statutory power within the meaning of s 43A": [283]. 11. Curtis also involved the application of s 43A of the Civil Liability Act. The case concerned a claim for negligence arising from an accident in which the de facto partner of the first appellant was fatally injured when the car she was driving ran off the road and hit a tree. At the time of the accident, Harden Shire Council was conducting road maintenance works on the section of the road where the accident occurred. It was common ground that in carrying out those works the Council owed a duty of care to road users, which included placing appropriate warning signs near the works: [234]. The appellants' claim was dismissed at first instance on the basis that s 43A of the Civil Liability Act was engaged and the test in s 43A(3) was not satisfied. 12. One of the grounds of appeal was that the primary judge erred in concluding that s 43A of the Civil Liability Act applied. Basten JA, with whom Bathurst CJ agreed and with whom Beazley P agreed on this issue (at [1], [220]), stated that the question of whether s 43A is engaged must be approached in two stages (at [235]): "The first is to identify whether and to what extent the liability upon which the defendant is sued 'is based on' the exercise of a statutory power conferred on the defendant: s 43A(1). The second stage requires reference to the power so identified to determine whether it is a 'special statutory power' as defined in subs (2). To satisfy the definition, it must be a power 'conferred by or under a statute' and 'of a kind that persons generally are not authorised to exercise without specific statutory authority': s 43A(2)(a) and (b) respectively." 1. The appellants did not contend that there was any negligence involved in the actual roadworks, contending instead that Harden Shire Council had failed to provide adequate signage to indicate that the road had been resurfaced and that motorists should reduce their speed: [237]. The primary judge held that the focus of the hearing as constituting the breach of duty was the failure to provide adequate signage during the inspection stage. Basten JA noted that in respect of those matters, the trial judge was satisfied on the evidence that a speed reduction sign in combination with a pictorial 'Slippery Road' sign should have been put in place in advance of the commencement of the roadworks, to alert users to the potentially hazardous condition of the road. This had not been done: [239]. 2. As Basten JA summarised the appellants' argument in Curtis, they first contended that s 43A of the Civil Liability Act was not engaged because the liability was not "based on" any exercise of a special statutory power by Harden Shire Council, but rather was based on a breach of a common law duty to warn of dangers created by the carrying out of roadworks: [241]. In support of that submission, the appellants relied on the reasons of Campbell JA in Refrigerated Roadways at [375], to which I have referred above. However, as Basten JA noted at [242] of Curtis, what Campbell JA said at [375] followed from his Honour's earlier finding about the RTA's ownership of the bridge being sufficient to empower it to erect screens. It was against that background that Basten JA said the following in Curtis at [243]-[244]: "If the omission pleaded [in Refrigerated Roadways], namely the failure of the RTA to erect screens along the bridge over the freeway, did not constitute a failure to exercise a special statutory power, it was correct to say that the claim was not 'based on' the failure to exercise a special statutory power. Whether a similar conclusion would arise in the present case depends upon an analysis of the acts and omissions upon which the appellants relied at trial. The expression 'based on' is not to be extracted from its statutory context and treated as a reference to the terminology used in the pleadings, as the appellants' submissions tended to suggest. What must be pleaded are the acts or omissions which give rise to a cause of action. Adopting the language of subs (3), the question for the court will be whether 'any act or omission ... [gives] rise to civil liability'. Once the act or omission has been identified, it will then be necessary to inquire whether it is one 'involving an exercise of, or failure to exercise, a special statutory power'. A statement of claim need not identify the statutory source of any power which might be involved. While s 43A does not merely identify a defence, there is no doubt that a defendant must plead not the terms of the provision as such, but the facts giving rise to its engagement. The plaintiff will then have to establish negligence to the statutory standard to succeed. (The pleadings on both sides left much to be desired in this case.)" 1. The acts or omissions relied on at trial in Curtis related to the installation of certain traffic control signs: [245]. The missing signs fell within the definition of a "prescribed traffic control device" in s 50 of the Road Transport (Safety and Traffic Management) Act 1999 (NSW). Section 52(1) of that same Act provided that a person must not, without appropriate authority, "install or display a prescribed traffic control device on, above or near a road or road related area", while the conferral of appropriate authority was dealt with in s 51 (and included conferral on a local council): at [247], [249]. Basten JA described s 52 as reflecting "the commonsense proposition that only someone with authority could place a regulatory sign beside a road limiting the speed at which vehicles might travel, or otherwise warning of hazards": [248]. His Honour concluded that the power to place prescribed traffic control devices beside the road was one which could not be undertaken by persons generally, but could be undertaken by a public authority, including the Council, in accordance with the statutory regime: at [253]. 2. The appellants in Curtis sought to emphasise the comments in Refrigerated Roadways regarding the manner in which courts have read down protective provisions granting statutory authorities immunity from suit in negligence when carrying out functions in good faith, so as generally to restrict the immunity to activities which are reliant for their lawfulness on a statutory power. They further sought to characterise the activities of Harden Shire Council as no more than exercising powers as a landowner: [254]. In rejecting that contention, Basten JA stated that "the prohibition on any person installing prescribed traffic control devices, combined with the requirement for statutory authority to undertake such an activity, placed the grant of authority for such activities squarely within the concept of a 'specific statutory authority', as used in s 43A(2)(b)": [254]. 3. The liability on which Harden Shire Council was sued in Curtis was thus "based on" its failure to exercise a special statutory power, being the power to erect prescribed traffic control devices on a road or road related area. By contrast, the liability on which the RTA was sued in Refrigerated Roadways was based on its failure to exercise the rights it possessed as the owner of the road, to erect an appropriate structure that would prevent heavy objects being thrown onto the traffic below. Similarly, the nuisance that was the subject of the proceedings in Gales was based on Tweed Shire Council's allowing water to continue to flow onto the appellant's land. 4. Weber provides another example. The appellant's home was damaged by a fire which started in a waste disposal site run by the respondent Council, which was referred to in the proceedings as "the tip". The trial judge found that the Council owed her a duty "to take reasonable care to avoid risk of personal injury or property loss caused by the escape of fire from the Tip" (as the tip was defined in the first instance judgment). One of the issues, which was the subject of a notice of contention on the appeal, was whether the primary judge erred in dismissing the Council's reliance on s 43A of the Civil Liability Act: [10]. 5. Basten JA (with whom Gleeson JA agreed and Sackville AJA agreed (the latter in separate reasons)) noted that the tip was created on Crown land reserved from sale, of which the Council was the trustee: [32]. Section 63(1) of the Rural Fires Act 1997 (NSW) provided that it was the duty of a public authority to take the notified steps (if any) and any other practicable steps to prevent the occurrence of bush fires on, and to minimise the danger of the spread of a bush fire on or from, relevantly, any land vested in or under its control or management. Basten JA stated that whether s 43A of the Civil Liability Act was engaged in this case involved two steps: [44]. The first step was as follows (at [45]): "The first step is to identify the basis of the liability relied on by the plaintiff. That liability depended upon the failure of the Council to undertake identified precautions in the management of the tip. Those precautions included grading an appropriate firebreak around the tip, reducing the fuel load within the tip by levelling areas and removing long grass, and, with respect to the general waste dump, compacting the dump and covering it with soil from time to time." (Emphasis added.) 1. The second step was "to determine whether these activities involved the exercise of a power conferred by statute, of a kind that persons generally are not authorised to exercise without specific statutory authority": [45]. There was a distinction to be drawn, in his Honour's opinion, "between activities which are reliant for their lawfulness on a statutory power and those which can be undertaken in accordance with the general law". His Honour referred in this respect to the decision in Refrigerated Roadways, to which I have referred above and continued at [47]: "Thus, a council officer requires no statutory authority to drive a vehicle on a public road beyond the licensing requirements applicable to all drivers; whereas statutory authority is required for the erection of signs along a roadway, an activity which is prohibited except by or with the consent of the relevant roads authority." 1. The second part of the distinction his Honour drew was, of course, the factual situation that was at issue in Curtis. His Honour concluded that the steps required to be taken on the tip "could readily be taken by the owner or a person having management of the land for waste disposal purposes, without any specific statutory authority": [47]. In his Honour's opinion, the same reasoning would apply in relation to s 48 of the Local Government Act, which conferred powers of control on the Council with respect to public reserves: "[t]hat provision conferred no specific authority with respect to conduct on the reserve, although the creation of the reserve would have restricted the activities which the Council could undertake on the land": [48]. After noting that it was common ground that the licensing requirements under the Protection of the Environment Operations Act 1997 (NSW) did not apply, his Honour concluded at [50]: "It follows that the precautions which the Council failed to undertake, upon which the liability identified above was based, did not involve the failure to exercise any special statutory power conferred on the Council. Accordingly, s 43A, and the special standard of care to which it imposed, was not engaged in the present case." 1. I note that apart from the cases that have considered s 43A, there has been consideration of the language of "based on" where it is used in s 44(1) of the Civil Liability Act. The subsection provides: (1) A public or other authority is not liable in proceedings for civil liability to which this Part applies to the extent that the liability is based on the failure of the authority to exercise or to consider exercising any function of the authority to prohibit or regulate an activity if the authority could not have been required to exercise the function in proceedings instituted by the plaintiff. 1. In Zraika, Leeming JA (with whom Gleeson JA and Simpson JA agreed) stated that the absence of liability on the part of a public authority at which s 44(1) is directed, being "an absence of liability which is based on the failure to exercise or to consider exercising the function" (original emphasis), naturally directed attention to the way in which a plaintiff formulates their case: [90]. It did not follow, however, that the plaintiff's formulation was determinative. Leeming JA stated in this context that "[a] plaintiff whose lawyers are conscious of s 44 might artificially seek to recast a claim so as to avoid the operation of the section": [91]. 2. Turning to the present case, I consider that the Magistrate gave sufficient reasons for concluding that s 43A was engaged. However, her Honour reached that conclusion on the basis that it was sufficient that the alleged failure to take the pleaded precautions fell "within the exercise of [the Council's] statutory power": [135]. As Bastow submitted, framing the question in that way did not reflect the statutory language or the approach adopted in the authorities to which her Honour referred. Consistently with the provision, the question her Honour should have asked was whether the liability for which Bastow was suing the Council was "based on" an exercise of or failure to exercise a special statutory power. 3. As Basten JA stated in Weber at [45], it was first necessary to identify the basis of the liability on which Bastow relied, being the Council's liability in negligence. I have noted above that the duty of care that Bastow pleaded was for the Council to take reasonable precautions against the risk of it selling an impounded vehicle that the owner was trying to recover: FASOC [3E] (see [22] above). The point at which the duty arose was after the Council had impounded the truck pursuant to the Impounding Act and was in possession of the truck on that basis; and before it was sold or disposed of. In making the various approaches to the Council, Bastow, as the owner, was seeking to have the Council fulfil the statutory duty in s 23 of the Impounding Act to release the truck. It was the failure to make any record of those approaches that led to the truck being sold. Those omissions, however, gave rise to liability in negligence on the part of the Council only in combination with the Council's act of selling the truck. 4. As the Magistrate characterised the duty, it was to ensure that owners were not "deprived of the opportunity to recover the vehicles before they are sold": [97]. Bastow alleged that in breach of its duty, the Council failed to take precautions against that risk of harm, integral to which was the sale of the vehicle: FASOC [3E1]. The focus of Bastow's submissions in this Court was the omissions in making a record of its approaches, which reflected the focus those omissions are given in the pleading. Nonetheless, it remains the case that the Council's liability depended, critically, on the act of selling the truck. Looking at the liability as pleaded by Bastow, it was properly characterised as based on the Council's exercise of the power of sale in s 24 of the Impounding Act. Consistently with the second step that Basten JA identified in Weber at [45], the activities of the Council on which Bastow relied involved the exercise of the power of sale in s 24 of the Impounding Act, being a power of a kind that persons generally are not authorised to exercise without specific statutory authority. 5. Accordingly, although I consider that the Magistrate erred in her approach to the application of s 43A of the Civil Liability Act (which was the subject of Ground 5 of the notice of contention), on what I consider to be the correct approach to s 43A her Honour's conclusion that the section was engaged was correct. I would thus dismiss Ground 6 of the notice of contention. Issue 4: the application of s 43A(3) of the Civil Liability Act 1. As I noted at [22] above, Bastow pleaded that the Council's decision to sell the truck was, in the circumstances, so unreasonable that no authority could have properly considered its sale of the truck to be a reasonable exercise of its statutory power: FASOC [3G] and see DWS [68]. The Magistrate concluded otherwise. The Council submitted that her Honour was correct to reach that conclusion in the absence of evidence from Bastow on the issue of what a reasonable Council would do in these circumstances. Without that evidence, this Court could also not form a view as to what a reasonable Council would do in these circumstances: Tcpt 12.5-14. Accordingly, the Council submitted, the leave that was required to raise this ground, as an issue of mixed fact and law, should be refused. 2. The onus is on the plaintiff to establish that the public authority acted so unreasonably to reach the threshold set out in in subs 43A(3): Collins at [177]; Watches of Switzerland Pty Ltd v Transport for NSW [2018] NSWSC 1256 at [62]. In Curtis, Basten JA set out the relevant inquiry as follows at [277]-[279]: "The final clause sets a standard. The standard is an act or omission that is 'so unreasonable' that no authority could 'properly consider the act or omission … to be reasonable'. This is a curious form of expression: it is not that the act be so unreasonable that no reasonable authority could do the act, but it may perhaps be assumed that the reference to 'no authority' is a reference to 'no authority acting reasonably'. That conclusion is supported by the reference to an authority which 'could properly consider' the act to be reasonable. That reading should be accepted. The other awkwardness of expression is that the court is required to consider not whether it considers the act (to paraphrase) grossly unreasonable, but rather whether no authority properly considering the matter could consider it to be reasonable. This test has two aspects. First, the identification of the body to be satisfied as to the proper characterisation of the act or omission is not the court but another public authority. That is, it is like the test of apprehended bias in administrative law, which asks not whether the court might think that the decision-maker might not bring a fair and unbiased mind to the task, but whether a fair-minded lay observer might think that the decision-maker might not bring such a mind to the task. With apprehended bias, the identification of the holder of the opinion is understandable; with liability in tort, it is less clear. It means that the court must view the matter through the eyes of a responsible public authority, having particular expertise and functions. (See also the distinction noted in Jamal v Secretary, Department of Health (1988) 14 NSWLR 252 at 262D-F (Kirby P).) The second aspect of the statutory language is that the state of mind of the authority is not identified as one which it would or should hold, but rather one which no authority could hold. In other words, it envisages a range of opinions as to what might constitute a reasonable act or reasonable failure to act, but asks if no public authority properly considering the issue could place it within that range." (Original emphasis.) 1. I have set out above the Magistrate's findings on the acts and omissions of the Council, which were not the subject of challenge. As Bastow submitted, the exercise of the power of sale or disposal in s 24 of the Impounding Act has significant legal consequences. I have addressed those consequences in detail in the context of my discussion of s 45 of the Impounding Act. The Magistrate noted by reference to the evidence of the Council officers that the purpose of the policy, and recording all interactions regarding impounded items on the CRM, was to guard against the consequences in s 45(2) of the Impounding Act being visited upon an owner who is actively seeking the release of an impounded item in the prescribed period before the item must be sold. Where the Council is satisfied of the matters for which s 23 of the Impounding Act makes provision (see [33] above), the Council must release the item, recognising that although the Council may have lawfully impounded an item, that impounding is subject to a person demonstrating good title to the item in the prescribed period. 2. As a matter of common sense, unless an owner's personal approaches to the Council were recorded, the relevant officers within the Council could not know if an owner was seeking to recover the owner's property unless, fortuitously, one of those officers was present and available to see the owner upon their attendance at the Council offices. Having regard to the significance of the legal consequences of an exercise of the power of sale in s 24 of the Impounding Act, in circumstances where Bastow had attended the Council on multiple occasions, as her Honour found, in an effort to obtain the release of the truck, the Council's sale of the truck was so unreasonable that no authority could properly consider the act of sale to be reasonable. The Magistrate's description of the circumstances as involving no more than a hole in the Council's policy thus understated the circumstances of the present case. 3. The Council's submission that the Magistrate did not have any expert evidence before her on which to make the assessment that s 43A(3) requires was premised upon there being a need for evidence. The statutory power involved, and the liability pleaded, was not of a nature that would be assisted by expert evidence. It can be contrasted with a case like Curtis, where the s 43A(3) question involved consideration of what road signs needed to be placed near the roadworks in question, so as to alert drivers to changed road conditions and to advise as to the necessary reduction in speed. 4. There were multiple failures of the policy in the period between 28 November 2019 and the date on which the Council sold the truck. I consider that no authority could properly consider that the sale of the truck in the present case, in the face of the Council's omissions, was a reasonable exercise of the power in s 24 of the Impounding Act. As the error is one of mixed law and fact, I would grant leave to Bastow to raise Ground 8 of the notice of contention and I would uphold the ground. Conclusion 1. I have thus upheld the Magistrate's order giving judgment for Bastow on the basis of its claim in negligence. The Council's Summons sought to set aside that order and substitute it with an order giving judgment for the Council. It follows from my reasons that the Summons should be dismissed. Although that result is in Bastow's favour, both parties have had a measure of success on their respective legal arguments, and neither party has had complete success. In the circumstances, it is appropriate to allow the parties an opportunity to be heard on costs with the benefit of these reasons. Accordingly, I will allow a short period of time in which the parties may file and serve written submissions (of no more than two pages), with a view to my determining the issue on the papers. Of course, if the parties are able to reach an agreed position on costs I will receive short minutes in the same period. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 21 September 2023