BLUNDEN t/a SOUTHERN WATER SPORTS v. SOLOMON by his tutor CAROL ANNE FRIEND [2005] NSWCA 52

New South Wales Court of Appeal

CITATION: BLUNDEN t/a SOUTHERN WATER SPORTS v. SOLOMON by his tutor CAROL ANNE FRIEND [2005] NSWCA 52

HEARING DATE(S): 03/02/2005

JUDGMENT DATE: 3 February 2005

JUDGMENT OF: Mason P at 1,31; Beazley JA at 2; McColl JA at 30

DECISION: Dismissed with costs.

CATCHWORDS: NEGLIGENCE - duty of care - jet ski hire - nature and extent of duty - 16 year old novice using jet ski - whether safety instructions given were adequate to discharge duty of care - contributory negligence - damage - calculation of future economic loss

CASES CITED: Graham v. Baker (1961) 105 CLR 340

TIMOTHY COUSINS BLUNDEN t/a SOUTHERN WATER SPORTS (Appellant) PARTIES: AARON MARK SOLOMON by his tutor CAROL ANNE FRIEND (Respondent)

FILE NUMBER(S): CA 40158/04

S.G. Campbell SC (Appellant) COUNSEL: B. Toomey QC/A. Black (Respondent)

Hicksons Lawyers (Appellant) SOLICITORS: Walsh & Blair Lawyers (Respondent)

LOWER COURT JURISDICTION: District Court

LOWER COURT FILE NUMBER(S): DC 17/02

LOWER COURT JUDICIAL OFFICER: McLoughlin DCJ

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 040158/04

MASON P BEAZLEY JA McCOLL JA

3 February 2005 TIMOTHY COUSINS BLUNDEN t/a SOUTHERN WATER SPORTS v. AARON MARK SOLOMON BY HIS TUTOR CAROL ANNE FRIEND Judgment 1 MASON P: I invite Beazley JA to deliver the first judgment. 2 BEAZLEY JA: The respondent sustained severe injuries on 1 April 2001 when he was involved in a jet ski collision at Corrigans Beach, Batehaven. He was aged fifteen years and two months at the time. He sued the appellant from whom the jet ski had been hired, alleging that the appellant had been negligent in failing to provide him with instructions as to particular aspects of the riding and steering of the jet ski. The respondent was successful in his claim and his Honour McLoughlin DCJ awarded damages in a total sum of $347,035. The appellant appealed against his Honour's finding of liability as well as that portion of the award relating to the assessment of future economic loss. 3 At the time of the accident the respondent was holidaying with his family and a friend his own age at Batehaven. On the day before the accident his mother had inquired at the respondent's business in relation to jet ski hire, there having been a brochure in the family's holiday accommodation advertising the appellant's business. At the time of her inquiry she asked whether one had to be sixteen years to ride the jet ski, as the brochure had indicated that was the case. The appellant responded affirmatively, but he added that "it would be possible [to ride the jet ski] if the respondent's mother signed the boys on with her". The respondent's mother booked two jet skis for the morning of 1 April. On that morning, before she and/or the respondent were given access to the jet ski the respondent's mother signed a disclaimer form on behalf of herself and the respondent, which provided in part "The proprietors will not be liable for any personal injury in relation to the activity however caused". 4 The respondent's father signed an identical form on behalf of himself and the respondent's friend. 5 Mrs. Jenkins denied that she read the document, and said that she believed the document she was completing was a licence. The respondent's father apparently did read the form and said he understood the above clause to be a disclaimer of liability. 6 No issue now arises as to the legal effect of this clause on the respondent's claim. The disclaimer point, whilst pleaded, was not raised in argument at trial and this Court ruled at the commencement of this hearing that leave would not now be given to permit the matter to be raised. At trial, counsel for the appellant expressly abandoned the point in a conversation between the legal representatives of the parties prior to the completion of the evidence in the matter. 7 Prior to the day of the accident the respondent had never used a jet ski. In fact, he had not been out in a boat even as a passenger. He had never ridden a motorcycle or other machine that had an accelerator that was part of the handgrip, and the only other vehicle that the respondent had driven was a go-kart. Of particular relevance is that he had no knowledge of how to control the jet ski if it encountered a wave. 8 There is no explanation in the evidence as to why the appellant's advertising material indicated that persons under the age of sixteen years were not permitted to hire the jet skis. There was no legal prohibition on persons under that age riding jet skis, although under the water traffic regulations the speed at which such craft could be ridden was limited to ten knots. The regulations also required riders of jet skis to hold a licence, however, there was an exemption that enabled Mr Blunden to hire out jet skis to persons who were unlicensed. This exemption was subject to a condition that sufficient instruction was given to the rider to allow the jet ski to be safely operated. 9 The appellant gave some instructions prior to the respondent commencing to ride the jet ski about its use and operation. The respondent, his friend, and the respondent's mother and step-father then used the skis for the period of that hire. Later that day they returned to the appellant's business and hired two jet skis for a further hiring period. It was during the course of this hiring that the respondent's accident occurred. 10 The evidence in the respondent's case established that the accident occurred when the respondent was riding out towards the jet ski course and was travelling through a swell. At this time, the jet ski changed direction and collided with a jet ski that the respondent's mother was riding. The trial judge accepted the version of the accident given by the respondent's mother and by the respondent's friend. He rejected the appellant's version of the accident on the basis that it amounted to a reconstruction. 11 The trial judge found that the respondent was out of control and changed course as he went through a swell. His Honour found that this happened because the respondent had not been properly instructed by the appellant as to the dangers arising when power was let off or if the rider let go of the throttle. 12 I have mentioned earlier that the appellant gave some instructions to the respondent as to the use of the jet ski. The content of those instructions was not the subject of a specific finding by his Honour. In the course of argument, senior counsel for the appellant accepted that some rudimentary instruction did need to be given to hirers of the jet ski. The question which arises here is what instructions ought to have been given. In other words, what instructions were of such a rudimentary nature as were required to be given in the circumstances of this case? 13 The trial judge found that there were certain instructions that were not given and which should have been given in order to enable the respondent to safely ride the jet ski: first, an instruction that to safely turn the jet ski at any speed above trolling speed it was necessary to keep the throttle open; secondly, and this is probably a variation on the first instruction, that when the jet ski was travelling at planing speed and the throttle was released and a turn attempted, the jet ski would not turn but would continue straight ahead; and thirdly that the waves affected the direction of travel of the jet ski. Finally, the appellant did not advise the respondent to stay fifty metres apart from other jet skis. The trial judge found that as the appellant had been given no instructions to deal with the circumstance in which he found himself, he lost control in the way I have indicated. 14 The trial judge found that in the circumstances the appellant had breached the duty of care that he owed to the respondent. It was implicit in his Honour's finding that that breach was causative of the accident. His Honour also found that the appellant suffered economic loss as a result of the injuries he sustained in the accident. I agree with his Honour's reasons. I would just add the following further comments. 15 The appellant challenged the trial judge's finding in relation to the nature and extent of the duty of care owed by the appellant to the respondent. In particular, he contended that given what was involved here was two one-half hour temporary hirings of the jet ski, the appellant could not have put the respondent in a position, by way of instruction, so that the respondent would be competent to deal with all reasonable eventualities. It was also submitted that the respondent had voluntarily undertaken a risky activity in circumstances where the extent of the hiring did not place the appellant in the position of a professional instructor vis-a-vis the respondent. 16 In my opinion, the trial judge was correct in finding that the particular instructions to which I have referred were instructions that should have been given to a person who was known to be a first time user of a jet ski. Some of those instructions were contained in the owner operator manual for the jet ski as well as in the riding practice handbook. Not every instruction in those documents was necessary to be given in order for the appellant to satisfy the duty of care that he owed to the respondent. However, account had to be taken of the particular circumstances of this hiring which included that the respondent was of a young age and was completely inexperienced, not only in the use of a jet ski but in the use of mechanically propelled vehicles. 17 It was well known that novice operators of jet skis tended to react in particular ways when confronted with either an emergency or a danger. The manual specifically warned about this. On two separate occasions, the manual stated that it was important to watch for the fact that beginners tended to release the throttle lever when turning or trying to avoid an object, and that it was necessary to always use the throttle when turning. In addition, the manual specified that particular action had to be taken when crossing a wave otherwise the jet ski would change direction as a result of the effect of the wave upon the vehicle. 18 Although the appellant had not read all of the material in the manual and the handbook, the evidence in those books demonstrates that these were specific dangers to parties who are not experienced in the use of the jet ski. These were dangers of which the appellant was well aware. In the circumstances of this case, the appellant's failure to give instructions in relation to those matters, to the respondent, constituted a breach of his duty of care. 19 In a proposed amended notice of ground of appeal, the appellant also sought to challenge his Honour's finding on liability on the basis that the respondent had failed to give any evidence that the appellant's negligence had caused his injury. It is not necessary for the Court to rule on the grant of leave on this matter because, for the reasons which follow, I am of the opinion that causation was well established in this case. 20 The argument on causation seemed to be predicated in large measure upon the fact that the respondent had failed to give any evidence that he would have complied with warnings in relation to the use of the jet ski. In my opinion, however, this case is not a warning case. Rather, it is essentially a case based upon an absence of appropriate instruction, to which reference has already been made. The appellant was well aware of each of those matters, and although he did not concede that it was necessary to give an instruction in relation to any of them, reasonableness required that each of those instructions be given. 21 In this case the accident was caused by a combination of, it would seem, the failure to have the throttle engaged, an inability to manoeuvre across the swell, possibly some speed, and also the lack of an appropriate distance between the respondent's jet ski and that of his mother at the time that the jet ski changed direction and came over the swell. The first of these two matters were the very matters that his Honour found required instruction. In such a case I do not consider that it was necessary that the respondent give evidence that he would have driven the jet ski in accordance with instructions. In any event, there was evidence from which such an inference could be drawn. The respondent had demonstrated in his first use of the jet ski that he acted responsibly. Further, as I point out below, the respondent gave evidence that he would have complied with safety warnings or directions had they been given. Whilst there was no direct evidence in relation to compliance with directions to keep the throttle open, the fact that he would have complied with other safety directions is probably sufficient of itself to draw an inference that the respondent was a person who would have complied with all appropriate instructions. 22 To the extent that the question of causation was dependent upon there being evidence that the respondent would have complied with any warning that may have been given, there was evidence upon which such a finding could have been made. First, there was the trial judge's assessment of the appellant as a responsible person. Secondly, there was evidence that he had acted responsibly in the morning in the use of the ski. Finally, the respondent gave evidence that if he had been instructed not to ride above a certain speed he would have complied with that. He also said that if he had been instructed to maintain a specific distance from other persons he would have done so. This evidence was not challenged. There was, therefore, ample evidence available to demonstrate that the appellant's negligence caused the accident and the consequential injury that flowed therefrom. 23 The appellant further contended in the written submissions that the respondent should have been found contributorily negligent. This matter was not further advanced in oral argument, but I do not take it as having been abandoned. I make the following short comments about it in the circumstances. 24 The particular matter of contributory negligence upon which the appellant relied was that relating to driving close to the other jet ski. The entirety of the evidence on this issue was as follows. The appellant's counsel had asked the respondent this question "You'd agree that if you, back then at 15 when you were driving this, you knew it would be dangerous if someone else told you to drive close to another skier ahead of you. That would be a dangerous thing to do?". 25 The respondent agreed with this proposition. That question contained within it, however, a number of propositions, only one of which, in my opinion, was relevant to or applied directly to the circumstances of the accident. His mother's jet ski, with which he collided, was not ahead of him, rather, the respondent was driving from another area closer to the beach out to the jet ski course. He was not at that time driving towards his mother at all. Rather, when he was a distance of some fifteen metres away, in an attempt to negotiate a swell, his jet ski changed direction at which point it was then in a collision course with his mother's jet ski. This is quite a different proposition than that put to the respondent in the question to which I have just referred. Although it is possible, and indeed probable, that the accident would not have occurred if the respondent maintained a distance of fifty metres, it was never put to the respondent that a distance of fifteen metres was an inappropriate distance to maintain between himself and another jet ski. It follows that the challenge to contributory negligence fails. 26 The last challenge to the trial judge's reasoning related to future economic loss. The trial judge found that the appellant had suffered significant orthopaedic injuries which continued to cause him disability and which would be on-going and serious. In particular, he was at risk of developing osteoarthritis in the hip joint, he might require multiple future surgery, and he would not be suitable for occupations involving heavy labour. His Honour considered that the respondent was a young man of potential. Given the nature and extent of his injuries, coupled with his Honour's opinion that the respondent was of a disposition that he would have worked hard in any chosen career, he considered that he had a significant interference with his economic capacity. His Honour acknowledged that to translate that into a specific economic loss was difficult. He approached the matter in the circumstances by allowing a figure which reflected, in broad terms, a percentage loss of the average weekly wage. He assessed that loss as being twenty-five per cent of $600 per week. He allowed a fifteen per cent discount for vicissitudes and rounded the figure down to $160,000. 27 Senior counsel for the appellant submitted that there was an error of principle in his Honour's approach, in that he failed to comply with the injunction in Graham v Baker (1961) 106 CLR 340 that economic loss should only be awarded to the extent that an impairment of economic capacity was likely to be productive of financial loss. In my opinion, his Honour clearly recognised that the serious orthopaedic injuries would likely to be productive of future financial loss. In effect, his Honour's approach amounted to providing a cushion by way of future economic loss, calculated on the specific basis to which I have referred. The making of an award of damages for interference of economic capacity by way of a cushion is a well recognised approach. The position given to it by his Honour's calculation did not alter that underlying basis and, in my opinion, there was no error in his Honour doing so. 28 It follows that, in my opinion, the appeal should be dismissed with costs. 29 MASON P: I agree. 30 McCOLL JA: I agree. 31 MASON P. The appeal is dismissed with costs.