GOWAN v HARDIE and ANOR SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CLARKE, MEAGHER and HANDLEY JJA 21 October 1991, 8 November 1991 [1991] NSWCA 126 CONTRACT — EXEMPTION CLAUSE — CONTRACTS REVIEW ACT s9(2). CONTRACT — Contract for parachute jump — Construction of exemption clause — Whether clause operated to protect servants and agents. CONTRACTS REVIEW ACT — Whether failure of trial judge to make specific findings in relation to s9(2) constituted appealable error — Whether exemption clause to be varied or declared void. HELD (1) The clause was not ambiguous. It was expressed in general terms applicable to all possible situations and on its face was for the benefit of both the second respondent, and its servants and agents. (2) A trial judge did not fall into legal error merely because, in a simple case under the Contracts Review Act, he failed to make specific findings. (3) Relief under the Contracts Review Act was rightly refused by the trial judge. Appeal dismissed with costs. Contracts Review Act 1980 s7(1); s9(1) and s9(2) Darlington Futures Ltd v Delco (1986) 161 CLR 500 Antonovic v Volker (1986) 7 NSWLR 151 Midland Silicones v Scruttons [1962] AC 446 Clarke JA I agree with Handley JA. Meagher JA I agree with Handley JA. Handley JA This is an appeal by the plaintiff from judgment for the defendants entered by Shillington DCJ in proceedings arising out of injuries sustained by her in the course of a parachute jump at Collector on 22 February 1986. The first respondent Sophie Hardie was the pilot of the Cessna aircraft from which the appellant jumped. The second respondent was the operator of the Canberra Sport Parachute Centre and had organised the jump. I take the following facts, which were not in dispute, from the judgment of the trial judge. On Tuesday 18 February 1986 the appellant made an application to the second respondent for parachute training she not having engaged in the sport previously. At the same time she made an application for membership of the Australian Parachuting Federation as required by the second respondent. The Canberra Sports Parachute Centre was associated with the Federation. The plaintiff paid $140.00 for the training course which included membership of the Federation. These arrangements were made at the second respondent's premises in the ACT. The appellant received some theoretical and practical training from the second respondent on the Tuesday evening and again on the following Thursday, concluding in a written examination. All this occurred at Canberra. On the following Saturday the plaintiff and two others met the second respondent at an airstrip at Collector in New South Wales. There they received further practical training including simulated jumping practice and harness familiarisation prior to embarking on the Cessna aircraft. 2 UNREPORTED JUDGMENTS The appellant thus had successfully completed the preliminary training both theoretical and practical. Her first jump was made from a height of 2,500 feet and the exit from the plane occurred correctly and without incident. When she was well below 300 feet she heard the plane and glancing to her right she saw it about 100 feet away landing on the airstrip. The appellant believed that she would hit the plane and took avoiding action. As a result her speed of descent increased. She landed awkwardly and fractured her right lower leg. The appellant's case was that she would have completed the jump without incident if the pilot had not landed when she did and brought the plane dangerously close to her. The judge found that the pilot had been guilty of negligence in flying the plane in such close proximity to the appellant particularly during her first jump and that this negligence had caused her injuries. He rejected other grounds of negligence and a defence of contributory negligence. He held that the pilot was acting as agent for the second respondent who was vicariously liable for her negligence. The judge held that the respondents were protected by an exemption clause in the contract entered into with the Canberra Sport Parachute Centre and refused the appellant relief under the Contracts Review Act (the Act). He gave judgment for the present respondents but in case an Appellate Court should come to a different conclusion on liability he assessed the appellant's damages. The central issue on the appeal concerned the operation of the Act in relation to the contract under which the appellant undertook the parachute jump and with the respondents' contention that it did not apply in relation to this contract which was made and partly performed in the Australian Capital Territory. The appellant's application for parachute training signed on 18 February contained the following warning: "PARACHUTING IS DANGEROUS. Any person parachuting, observing parachuting, learning to parachute, training to parachute, flying in any aircraft being used for or in connection with parachuting or participating in any activity carried on by this Centre does so at their own risk. It is a condition of admission to membership of this Centre, that this Centre, its directors, instructors, members, servants or agents are absolved from all liability howsoever arising from injury or damage howsoever caused (whether fatal or otherwise) arising out of membership of this Centre or participating in parachuting, learning to parachute, training to parachute, flying in any aircraft being used for or in connection with parachuting or in any way whatsoever due to any negligent act, breach of duty, default and/or omission on the part of this Centre, its directors, instructors, members, servants or agents, or the part [sic] of the Australian Parachute Federation, its office bearers, directors, members and servants or agents. Any person parachuting, observing parachuting, learning to parachute, training to parachute, flying in aircraft being used for or in connection with parachuting or participating in any activity carried out by this Centre are only allowed to do so on the distinct understanding that they do so at their own risk." The appellant signed the application and her signature was witnessed by her future husband who undertook the course at the same time. Above her signature the form stated: "T of DO HEREBY ACKNOWLEDGE that of my own free will and desire I have contracted with Canberra Sport Parachute Centre for instruction and training in parachuting activities which activities include parachute descents from aircraft and that I have read and understood the above warning...". URJ GOWAN v HARDIE and ANOR (Handley JA) 3 At the same time the appellant completed an application for membership of the Australian Parachute Federation. The following printed statement appeared in this form immediately above the space provided for her signature: "T, the abovenamed applicant, hereby apply for membership of the Australian Parachute Federation and in so doing agree to abide by the Rules and Regulations of that organisation whilst engaged in parachute and associated activities." The form also stated in bold print "IMPORTANT: READ NOTICE ON REVERSE. The reverse side contained the same exclusion clause as that quoted above from the form of application for parachute training headed by the word WARNING in bold capitals. The appellant was told at the Canberra Sport Parachute Centre that she had to fill in these forms. She did so and then paid her money for the course. She said that she appreciated the significance of the documents she was signing although later evidence would indicate that her understanding of the legal effect of the exclusion clause was not complete. The second respondent in his evidence agreed that he made it perfectly clear to his students that he was not prepared to take them for training and parachuting unless they signed those documents. He said that he explained to his students that they were participating in dangerous activities and he made sure that they were aware of that fact. The appellant submitted that on its true construction the exclusion clause did not protect the second respondent in this case where the accident was caused by the negligence of the pilot after the appellant had successfully jumped from the plane and that this situation was simply not envisaged by the clause. The relevant part of the clause reads as follows: ".. this Centre, its directors, instructors, members,... are absolved from all liability howsoever arising from injury... howsoever caused... arising out of... participating in parachuting... or in any way whatsoever due to any negligent act... or omission on the part of this Centre, its directors, instructors, members, servants or agents...". In my opinion this language, construed in accordance with the principles established in Darlington Futures Ltd v Delco (1986) 161 CLR 500 at 510 is not ambiguous and does apply to the present case. The relevant part of the clause is expressed in general terms apt to cover all possible situations and I see no basis for construing it as inapplicable to the present case. Accordingly the appeal on this issue fails. The first respondent, the pilot, also relied upon the exemption clause. The clause applied in terms to protect servants and agents of the second respondent and the judge held that the pilot could rely upon it because the requirements in Midland Silicones v Scruttons [1962] AC 446 at 474 were satisfied. The appellant challenged this conclusion but in my opinion the challenge was without substance. The clause on its face was for the benefit of servants and agents and the pilot was aware of its terms having previously undertaken the parachute course herself. The judge must have inferred that she relied on the clause when she agreed to fly the aircraft on the day in question and in my opinion this was the only reasonable conclusion on the evidence. Accordingly the appeal must fail unless the appellant is able to displace the effect of the exclusion clause. For this purpose her counsel relied upon the Act and submitted that the judge's decision in refusing relief under it was erroneous. S7(1) provides that where the Court finds a contract or a provision of a contract to have been unjust in the circumstances relating to the contract at the time it was made the Court may, among other things, vary any provision of the contract or 4 UNREPORTED JUDGMENTS declare it void. S9(1) provides, so far as relevant: "In determining whether a... provision of a contract is unjust in the circumstances relating to the contract at the time it was made, the Court shall have regard to the public interest and to all the circumstances of the case...". S9(2) lists in para(a) to para(1) some of the circumstances to which, if relevant, the Court shall have regard but those paragraphs do not limit the circumstances which may be relevant. The judge rejected the claim for the following reasons: "Parachuting is a highly dangerous sport as the plaintiff recognised. Riddell [the second respondent] explained [the forms] to the class on 18 February. There is no suggestion that the plaintiff was under any pressure to sign the documents which are in clear and unambiguous terms. It is reasonable that any person providing parachute training, for reward or otherwise, should require such indemnity as that claimed... not only for himself but for those acting as his agents." The appellant submitted that the judge's failure to make specific findings in relation to the relevant matters in s9(2) constituted an appealable error and we were referred to the decision of this Court in Antonovic v Volker (1986) 7 NSWLR 151 and in particular to the remarks of Mahoney JA at 165-166. The final submissions of the parties to the trial judge were made in writing. The appellant's submissions on this issue relied upon the absence of negotiation, the second respondent's insistence that the appellant sign the documents, the lack of any proper explanation of the documents from the second respondent, and that fact that the appellant had no legal advice as to the meaning and effect of the exclusion clause. It was also submitted that the exclusion clause was not reasonably necessary for the protection of the legitimate interests of the second respondent. The appellant's case for relief under the Act was relatively straight forward and the evidence on this issue was brief. The appellant's written submissions did not refer to any requirement for specific findings but in my opinion there is none. In a complex case they will generally be essential but where the facts are simple and not in dispute a trial judge does not fall into legal error simply because he fails to make specific findings. In the present case I would hold that the judge's findings and reasons were sufficient. The essential facts, for present purposes, are that the second respondent provided facilities which enabled those wishing to engage in this sport to do so at modest cost. The appellant was charged for the course but at the same time it is clear that services were being provided on a partly voluntary basis. The pilot was not being paid. The second respondent claimed that he sometimes made a modest profit from running these courses but some times made a loss. It does not appear whether the third member of the staff at Collector on the Saturday morning who remained on the ground throughout was being paid for his services but on any view his remuneration must have been modest. It does not appear whether the second respondent received any remuneration for running these courses other than his profits. However on any view he must have been giving his time on a partly voluntary basis appropriate in a sport like this. It is significant that it was the appellant and her fiancee who approached the second respondent wishing to undertake the parachute training that he offered and not vice versa. In my opinion there was no reason why he should not make known and insist upon the terms on which he would provide such training The appellant was free to accept or reject those terms and to seek parachute training elsewhere on better terms if they were available. In my opinion the exclusion URJ GOWAN v HARDIE and ANOR (Handley JA) 5 clause in the present case was not unjust at the time the contract was entered into. The appellant has been unable to establish any error of fact or law in the judge's reasons on this issue and in my judgment the decision was correct. It is therefore not necessary to decide whether the Act had any application to this contract which was made and partly performed in the ACT. This is a question of some difficulty and in my opinion there must be a real doubt whether the Act applied at all. In my opinion the appeal should be dismissed with costs. Counsel for the Appellant: CC BRANSON QC and D KENNEDY, Instructed by: VALERIE MARGARET de ROME Counsel for Ist Respondent: B MEAGHER, Instructed by: LAWLER AND Co Counsel for 2nd Respondent: G LUNNEY, Instructed by: MINTER SIMPSON