New South Wales Court of Appeal CITATION : Palmer and Jamieson t/as Byron Bay Skydiving Centre v Griffin [2002] NSWCA 100 FILE NUMBER(S) : CA 40743/01 HEARING DATE(S) : 2 April 2002 JUDGMENT DATE : 18 April 2002 PARTIES : Raymond Palmer and William Jamieson t/as Byron Bay Skydiving Centre - Appellant Joel Griffin - Respondent JUDGMENT OF : Meagher JA at 1; Handley JA at 2; Brownie AJA at 3 LOWER COURT JURISDICTION : District Court LOWER COURT DC 7788/98 FILE NUMBER(S) : LOWER COURT Sorby DCJ JUDICIAL OFFICER : COUNSEL : Mr D Jackson QC - Appellants Dr A S Morrison SC - Respondent SOLICITORS : Riley Gray-Spencer - Appellants Slater & Gordon - Respondent CATCHWORDS : No question of principle. LEGISLATION CITED : Fair Trading Act 1987 CASES CITED: Saad v TWT Ltd Court of Appeal, 29 May 1998 unreported Global Sportsman Pty Ltd v Mirror Newspapers Ltd (1984) 2 FCR DECISION : Appeal allowed with costs, judgment and order below set aside, substituted a judgment for the defendants, with costs. IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL 40743/01 MEAGHER JA HANDLEY JA BROWNIE AJA 18 April 2002 PALMER AND JAMIESON t/as BYRON BAY SKYDIVING CENTRE v GRIFFIN Judgment 1 MEAGHER JA: I agree with Brownie AJA. 2 HANDLEY JA: I agree with Brownie AJA 3 BROWNIE AJA: The appellants were proprietors of a business that provided sky diving and parachuting facilities. The respondent, a student parachutist, was a customer of that business, who sustained serious personal injuries in an accident that occurred on 2 November 1995. She sued for damages, and the learned trial judge, Sorby DCJ, found that the appellants were guilty of negligence, but that terms of the contract between the parties operated to exempt the appellants from liability. He also found against the respondent in relation to a claim for damages for breach of contract, and a claim under s 43 of the Fair Trading Act 1987 ("the Act"), for unconscionable conduct. None of these findings was challenged on appeal. 4 The respondent also sought damages under s 68 of the Act, for breaches of ss 42 and 44(b) and (e), that is, for misleading or deceptive conduct. In this connection the respondent relied upon three representations said to have been made on behalf of the appellants. His Honour referred to these as representations (a), (b) and (c), and the appeal proceeded by reference to that convention. The judge found against the respondent in relation to representations (a) and (b) but for the respondent in relation to representation (c). The appellants appealed from the last mentioned finding and the respondent filed a notice of contention seeking to reverse the findings made in relation to representations (a) and (b). These were the only issues argued on appeal. 5 I need to say something of the background before stating the representations relied upon. Regulations made by the Australian Parachutist Federation, not having the force of law, but accepted as describing what was reasonable under the circumstances, provided that a student parachutist, such as the respondent, should not parachute or be permitted to parachute when the wind speed at (or about) ground level exceeded 15 knots, and made similar provisions in relation to more experienced parachutists when the wind speed exceeded 20 knots. 6 On the day of the accident, the respondent was the only fee paying customer of the appellants and she was accompanied by an instructor, Mr Dave McLean, who was to jump with her. However, there were three other parachutists on the same flight. The appellants had recently purchased the business from Mr Ron Llewelyn, and it had been arranged that for publicity purposes while the two men were parachuting together, he would hand to Mr Archie Jamieson on behalf of the appellants a paper, symbolically representing the assignment of the business. This ceremony was to be filmed by Mr Dan Llewelyn, who was the son of Ron Llewelyn and the boyfriend of the respondent. These three men and Mr McLean were all experienced parachutists and Mr Archie Jamieson was, in some sense not really explained by the evidence, also an instructor of the respondent. 7 The intended flight was delayed for some time, because the wind speed at about ground level exceeded 20 knots. All concerned therefore waited until the wind speed dropped. The person in charge of the operation over all was Mr Steve Lewis, who held the title (given by the regulations) of Drop Zone Safety Officer. One of his functions was to monitor the wind speed. When he had assessed that it had dropped sufficiently, he told the five intending parachutists and the pilot of the plane, Mr Roger Spinks. They all boarded the plane. The respondent described what happened then. She was concerned that the wind speed was excessive. Her evidence continued: "A. Okay, once we were in the plane and he had said the wind was a bit sus, I said, "I'll get out. It doesn't matter. I won't go." Steve said, "No, you will be okay, I will radio the plane if it gets any stronger." Prior to that he said he would go out on to the airstrip and measure the wind out there and wave to the plane if it was okay, which meant if it was within my limits. Then he said he will radio the plane if it got any stronger while we were in the air…. Q. Right. Was anyone else involved in the conversation or just you and Steve Lewis? A. No, when I said, "I'll get out. It doesn't matter, I won't go", and Steve said "No, it will be okay, I will check it now and radio the plane if it gets any stronger", he was basically talking to the whole plane, to all of us sitting in the plane so he was basically talking to all of us. Q. What happened next? A. The plan taxied out and we waited at the end of the runway and Steve checked the wind with the hand held metre and he waved to the plane so we took that as it was within my limits and it was okay to go up. Q. Yes? A. So we took off and commenced to go to 10,000 feet, which was the height we were jumping from…. Q. Was there any conversation at that point? A: Yes, I said that "There is white caps on the water. Doesn't that mean that the wind is over 15 knots?" Q. Did anyone reply? A. Yes, the instructors told me that. Q. First of all, which instructor or instructors? A. Archie Jamieson and Dave McLean. Q. First of all, what did Archie Jamieson say? A. That it would be okay because Steve would have radioed if the wind had picked up any more on the ground. Q. Right. And Mr McLean? A. He also assured me that Steve would have radioed if it had got any stronger. Q. What happened then? A. Dan, Ron and Archie jumped out first. As we were going to climb out I asked Roger Spinks if Steve had radioed. He said no, "He still hasn't radioed so you will be okay. "" 8 Later, still in chief, she said:- "Q. Who did you understand would tell you to jump or not to jump on the day? A. It was all the time if I wanted to go for a jump I would say to either Steve Lewis or Archie Jamieson, "I want to go for a jump" and they would say, "yes, it's okay" or "No, it's [not] okay." So I totally relied on them of whether it was okay for me to go up for a jump. Q. On that particular day, once you were in the plane, who did you rely upon? A. I relied upon Archie Jamieson and Dave McLean telling me against my better judgment that it was okay because Steve had not radioed the plane." 9 As the plane was in its "drop run", that is, flying into the wind so that the five parachutists could jump from the plane, and parachute towards the designated target area, the wind speed at ground level increased. Mr Lewis observed this, and attempted on two or three occasions to communicate this circumstance by radio to the pilot, Mr Spinks. For reasons not established by the evidence he could not establish radio communication. Perhaps this was because Mr Spinks was then in radio communication with the relevant air traffic controller, obtaining the permission that the law required him to obtain before he permitted the parachutists to jump but this is not established with certainty, although Mr Lewis' attempts to communicate with Mr Spinks and Mr Spinks' communications with the air traffic controller probably occurred at or about the same time. 10 Mr Lewis then attempted to display appropriate signs on the ground, so as to warn those on the plane not to jump, but before he had put these signs into place the five parachutists jumped. First, Mr Rod Llewelyn and Mr Jamieson jumped, followed immediately or almost immediately by Dan Llewelyn, and a short time later, Mr McLean and the respondent, holding hands, jumped together. All landed safely except the respondent. She opened her parachute at a greater height than Mr McLean so that she descended a little later than he did. When she was a short height above the ground level, a gust of wind struck the canopy of her parachute with the consequence that she landed heavily and awkwardly. 11 The three representations that the respondent relies upon were described by the learned trial judge in these terms: "(a) Steve Lewis in reference to the Plaintiff offering to get out of the plant before take-off: "No you will be okay; I will radio the plane if it [the wind] gets any stronger" … (b) Messrs Jamieson and McLean said to the Plaintiff in the plane prior to the jump that: "It would be okay because Steve would have radioed if the wind had picked up any more on the ground"… (c) The Plantiff asked the pilot Mr Spinks before climbing onto the plane's struts to jump and he said: "He still hasn't radioed so you will be okay. …" 12 This summary is a little inaccurate as to representation (c): the respondent jumped from the aircraft door, whilst Mr McLean jumped from the aircraft wheel, but nothing turns on this. His Honour found that representation (a) concerned a future event within the meaning of s 41 of the Act, and that Mr Lewis had reasonable grounds for making the representation: he intended to monitor the wind speed and he actually did so, and he intended to radio the plane if the wind speed increased and he attempted to do that. His Honour also found that the appellants had reasonable grounds to make the representation as the system of radio communication had never failed in the past. 13 The respondent now attacks the finding that either Mr Lewis or the appellants acted reasonably, in making representation (a). The appellants accepted that Mr Lewis was their agent when he made the representation. The debate centred upon the possibility that radio communication between Mr Lewis and Mr Spinks might fail. The respondent contended that in the circumstances the representation should have been qualified by some statement to the effect that Mr Lewis might have tried unsuccessfully to communicate by radio. Clearly enough, an unqualified representation may constitute misleading conduct in trade or commerce if the relevant circumstances require the statement to be qualified: Saad v TWT Ltd, Court of Appeal, 29 May 1998, not reported at 6, and the authorities cited there. But it depends on the circumstances. 14 The respondent relies on the fact that, to the knowledge of each of Mr Lewis and Mr Spinks (who were relevantly agents of the appellants), it was possible that radio communication might be attempted, and might fail, and she contended that in these circumstances the representation should have been qualified. On the other hand, Mr Spinks, for example, said: "Generally the radio is fail safe, it does get through"; and other witnesses gave evidence to the same general effect – they recognised the theoretical possibility of failure, but in practice radio communication worked. 15 Reading representation (a) as a whole, I agree with the trial judge that, on the evidence, Mr Lewis and the appellants had reasonable grounds for making the representation. 16 Representation (b) really consists of two separate representations made by different people, although to the same general effect. At the time the evidence about these representations was given, the pleadings had not taken their present form, and the evidence was left in what now seems to be an unfortunate state. Again, there is no issue but that Messrs Jamieson and McLean were the agents of the appellants, for the purpose of making the representations. The learned trial judge again categorised the representations as concerning future events. The respondent contends, and the appellants accept that this was inaccurate, and I respectfully agree. The substance of the representation seems to me to consist, first, of the proposition that Mr Lewis had not radioed, that is, that radio communication had not been established; and, secondly, of an expression of opinion that it would be okay for the respondent to jump. This involves a rather different question to that arising concerning representation (a). No question of reasonableness arises. Rather, the question is whether in the circumstances what was done and said constituted misleading or deceptive conduct. I consider that the proper finding on the evidence is that what Messrs Jamieson and McLean said represented the expression of an opinion which each of them actually held at the time, to the effect that it was okay for the respondent to jump, given that Mr Lewis would have radioed if the wind speed had increased. Their opinion was that radio communication would have been effective. 17 There was some debate concerning the meaning to be attributed to the expression "radioed". No doubt it goes without saying that the topic under consideration was the establishment of contact, by radio, between Mr Lewis on the ground and Mr Spinks in the plane. Objectively, Mr Lewis had attempted to establish that contact, but the attempt failed, and from the perspective of Mr Spinks and those on the plane, radio contact had not been established. 18 The focus here is on the provisions of s 42. The contention of the respondent depends upon the assumption that Mr Lewis had not attempted radio contact. 19 I therefore agree with the conclusion of the trial judge that the claim in respect of representation (b) should be dismissed. 20 No question was raised on appeal that the respondent relied upon representations (a) and (b). 21 Representation (c) stands in quite a different category. There is no question of futurity, but there are live issues as to whether Mr Spinks was the agent of the appellants when he made the representation, and as to whether the respondent relied on that representation. 22 I have quoted the evidence of the respondent above. In my respectful view, it is clear from her own evidence that she did not rely upon what Mr Spinks said. To the contrary, she said that she made an assumption that it would be okay to jump because, first, she had not heard from Steve Lewis and, secondly, her instructors Archie Jamieson and Dave McLean had told her it was safe to jump. She understood that it was the two instructors who were to tell her whether or not she should jump. 23 On that ground, I would allow the appeal. However, I also consider that Mr Spinks has not been shown to have been the agent of the appellants for the purpose of making the representation in question. Again, the representation consists of two parts: first, that Mr Lewis "still hasn't radioed"; and secondly, "so you will be okay". Again, there is a question as to the meaning to be attributed to the expression "radioed", and again it seems to me that the expression means no more than that Mr Lewis had not established an effective communication by radio. A number of possibilities suggest themselves: a breakdown of equipment at either end; radio traffic congestion; some accident or illness befalling either Mr Lewis or Mr Spinks; or atmospheric or solar conditions inhibiting efficient radio communication. 24 The respondent says that the representation that Mr Lewis had not radioed should have been qualified. For the reasons given above, concerning representation (a), I reject this proposition. 25 There is no doubt but that in some circumstances a statement which is literally true may be misleading or deceptive: Global Sportsman Pty Ltd v Mirror Newspapers Ltd (1984) 2 FCR 82 at 88. But that is hardly the problem here. Rather, the problem is the meaning to be attributed to the unscientific and imprecise expression "radioed". The respondent, understandably particularly in the state of the pleadings at the time she gave evidence, did not say what she thought the expression meant, nor did any other witness, and it seems to me to be artificial to say that one should now attribute to the expression an unstated understanding such as that Mr Lewis had not attempted to establish radio communication with Mr Spinks. If any of the persons concerned had thought about the question at the time, it seems likely that they would have concluded that the expression meant that radio communication had not been established. The respondent's submissions now concentrate on the possibility that communication might have proved impossible, temporarily, because of the possibility of radio congestion, but any of the possibilities mentioned above might equally have prevented effective communication, for some shorter or longer period of time. 26 Additionally, the submissions of the respondent repeatedly blur any distinction between negligence of the appellants in the common law sense and in the circumstances of this case with the questions of reasonableness for the purposes of s 41 of the Act – which is irrelevant when considering representation (c) – and the question whether in the circumstances of the case Mr Spinks was the agent of the appellants for the purpose of making representation (c). He was no doubt the agent of the appellant for the purpose of reporting to those on the plane any radio communication he received from Mr Lewis and in answering questions whether he had or had not received any radio communication from Mr Lewis, but on the evidence it has not been established that he was the agent of the appellants for the purpose of adding the comment "so you will be okay". The persons who were to advise the respondent were the instructors, Mr Jamieson and Mr McLean. In fact, Mr Spinks was himself an experienced parachutist, but the evidence does not establish that the respondent (or for that matter anyone else) knew this; and Mr Spinks said, without challenge or contradiction that the respondents had hired his plane, apparently for the day – he was not an employee of the appellants, nor their agent except in the limited sense just discussed relating to his reporting to those on the plane about radio communications received or not received. 27 No submissions were made on the point, but it might be that there is a question as to whether the statement made by Mr Spinks was made "in trade or commerce". In the circumstances it is unnecessary to consider the point. 28 The respondent contended that Mr Spinks became the agent of the appellants, because he was an essential link in the chain of communication between Mr Lewis on the ground and those in the plane. Up to a point, this is correct, but I do not think one can take either of the further steps contended for, so as to conclude that Mr Spinks became the agent of the appellants for the purposes of s 42, or that for that purpose he should have qualified his statement by saying words to the effect that he had not received a radio communication from Mr Lewis, although Mr Lewis might have attempted to communicate with him. 29 I propose that the appeal be allowed with costs, that the judgment and order below be set aside, and that there be substituted a judgment for the defendants, with costs. ********** 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. 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