New South Wales Supreme Court CITATION : Yun Hee Choi v City of Sydney Council & 4 others [2007] NSWSC 65 HEARING DATE(S) : 11 October 2006 - 7 November 2006 JUDGMENT DATE : 13 March 2007 JUDGMENT OF : Barr J at 1 DECISION : In the plaintiff's claim - 1. A verdict for the first defendant, City of Sydney Council, in the claim of the plaintiff, Yun Hee Choi. 2. A verdict for the plaintiff, Yun Hee Choi, against the second defendant, Prestige Property Services Pty Limited, in the sum of $718,259.95. Interest is not to run until 21 days after the second defendant has received from the plaintiff a completed Health Insurance Commission form and a Centrelink clearance. 3. The plaintiff is to pay the first defendant's costs and the second defendant is to indemnify her. The second defendant is to pay the plaintiff's costs of suit against both defendants. In the first cross-claim - 4. A verdict for the first cross-defendant, Prestige Property Services Pty Limited. 5. I make no order as to costs. In the second cross-claim - 6. A verdict for the first cross-defendant, Active Tree Services Pty Limited. 7. I order the cross-claimant, Prestige Property Services Pty Limited, to pay the costs of the first cross-defendant, Active Tree Services Pty Limited, on an indemnity basis. 8. A verdict for the second cross-defendant, City of Sydney Council. 9. I order the cross-claimant, Prestige Property Services Pty Limited, to pay the costs of the second cross-defendant, City of Sydney Council. In the third cross-claim - 10. A verdict for the first cross-defendant, P Matson on behalf of the Underwriting Members of Syndicate 990. 11. I order the third cross-claimant, Active Tree Services Pty Limited, to pay the costs of the first cross-defendant, P Matson on behalf of the Underwriting Members of Syndicate 990. Those costs are to be assessed on a party-party basis up to 5pm on 22 March 2006 and thereafter on an indemnity basis. 12. A verdict for the second cross-defendant, City of Sydney Council. 13. I make no order as to the costs of Active Tree Services Pty Limited and City of Sydney Council. 14. A verdict for the third cross-defendant, Prestige Property Services Pty Limited. 15. I make no order as to the costs of Active Tree Services Pty Limited and Prestige Property Services Pty Limited. CATCHWORDS : Negligence - plaintiff injured by falling tree branch - whether Council under a duty to protect users of park against injury by falling tree branches - whether tree dangerous - whether Council's duty delegable - whether Council's duty delegated to contractor - whether contractor under a duty to users of park - whether contractor in breach of duty - whether contractor's duty delegated to subcontractor - Negligence - damages - plaintiff brain damaged - assessment Kondis v State Transport Authority (1984) 154 CLR 672 Burnie Port Authority v General Jones Pty Limited (1992-1994) 179 CLR 520 Hollis v Vabu Pty Limited (2001) 207 CLR 21 Bazley v Curry [1999] 2 SCR 534 Bushey and Sons v United States (1968) 398 F2d 167 Northern Sandblasting Pty Limited v Harris (1997) 188 CLR 313 Voli v Inglewood Shire Council (1963) 110 CLR 74 CASES CITED : Eckersley v Binnie and Partners (1988) 18 Con LR 1 King v Stewart (1994) 85 LGERA 384 Hide and Skin Trading Pty Limited v Oceanic Meat Traders Limited (1990) 20 NSWLR 310 Codelfa Construction Pty Limited v State Rail Authority of New South Wales (1982) 149 CLR 337 Prenn v Simmonds [1971] 1 WLR 1383 DTR Nominees Pty Limited v Mona Homes Pty Limited (1978) 138 CLR 423 Thoday v Thoday [1964] P 181 at 197-8 Workington Harbour Board v Trade Indemnity Co Limited (No 2) [1938] 2 All ER 101 Yun Hee Choi City of Sydney Council PARTIES : Prestige Property Services Pty Limited Active Tree Services Pty Limited P Matson on behalf of the Underwriting Members of Syndicate 990 FILE NUMBER(S) : SC 20689/01 M B Williams SC and R A O'Keefe J G Stewart COUNSEL : D G Nock SC and J Downing E Petersen A J McInerney Gaitanis Lawyers McCulloch and Buggy SOLICITORS : Ebsworth & Ebsworth Livingstone & Company Griffin Hilditch IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION GRAHAM BARR J 13 MARCH 2007 20689/01 YUN HEE CHOI v CITY OF SYDNEY COUNCIL & ANOTHER JUDGMENT 1 HIS HONOUR: The plaintiff, Choi Yun Hee, whom I will call by her present, married, name, Mrs Choi, sues the defendants, the City of Sydney Council (the Council) and Prestige Property Services Pty Limited (Prestige), for damages following an incident that took place in Hyde Park North, Sydney on 14 December 2000. 2 On 14 December 2000 Mrs Choi, a native of South Korea, was twenty-two years old and an undergraduate student at Sydney University. During the afternoon she and a friend, Kim Eun Jung (Miss Kim), went to Hyde Park North and lay on the grass in a spot near the prominent sculpture called Earth, Water, Fire. Immediately to the east of the place where they sat were two parallel rows of trees, running north-south on the western side of the central avenue of the park. The trees were of the species ficus microcarpa var. Hillii, known as Hill's weeping fig. As Mrs Choi and Miss Kim were on the grass, a branch overhanging the lawn fell from one of the figs and struck Mrs Choi on the head, causing her serious injury. 3 Mrs Choi says that the Council had the care, control and management of Hyde Park and that it owed her a duty to take reasonable care to avoid exposing her to the risk of injury. She says that the Council was negligent, that is, in breach of its duty, in the following ways - (a) Failing to lay down an appropriate system for the inspection, care and maintenance of trees in Hyde Park in order to avoid risk of falling branches. (b) Failing to ensure the implementation and maintenance of such system. (c) Failing to ensure that areas of Hyde Park where people were accustomed to lie was a safe environment and was not subject to overhang of hazardous branches. (d) Failing to properly inspect trees in the areas where people were accustomed to lie on the grass. (e) Failing to warn of the likelihood of branches falling. (f) Failing to remove a specific hazardous branch which fell upon the Plaintiff. (g) Failing to ensure that any person to whom the First Defendant delegated any relevant responsibility in respect of the said Park, in fact discharged such responsibility fully and properly. 4 The Council denies that it had the care, control and management of the park. It denies owing Mrs Choi the duty alleged and denies negligence. In the first cross-claim the Council seeks indemnity or contribution from Prestige which, as a contractor to the Council, had certain obligations concerning trees in Hyde Park North. The Council repeats against Prestige the allegations of negligence made by Mrs Choi against the Council and adds the following particulars of negligence - (b) Failing to carry out the maintenance of the trees in Hyde Park in a conscientious, diligent and professional manner which is higher than or equal to the degree of skill, care and diligence normally exercised by recognised professional persons which supply services of a similar nature. (c) Failing to carry out the maintenance of the trees in Hyde Park in a proper and workmanlike manner. (d) Failing to maintain the subject tree such that it was healthy and free of diseases, insects, dead wood and damage. (e) Failing to remove all dead and dangerous branches from the subject tree. 5 As will appear, these latter assertions rely on the terms of a contract between the Council and Prestige. The Council also pleads the contract and avers breaches thereof. 6 In her claim against Prestige Mrs Choi repeats the assertions made by the Council in its cross-claim. She also asserts the existence between herself and Prestige of a proximity giving rise to a duty to her to conduct itself as the Council says it ought to have conducted itself. Prestige denies the allegations of breach. It does not admit the asserted proximity. 7 There was a subcontract by which Active Tree Services Pty Limited (Active Tree Services) agreed to do some of the work Prestige was obliged to do under its contract to the Council. In the second cross-claim, Prestige pleads its contract with the Council, sets up particular terms thereof and asserts Active Tree Services' breach of those terms. Active Tree Services puts the terms of any subcontract in issue, denies any asserted duty of care and denies the breaches pleaded. Prestige also seeks indemnity or contribution from the Council. 8 There is a third cross-claim, brought by Active Tree Services against its insurer, P Matson on behalf of the Underwriting Members of Syndicate 990, seeking indemnity under a policy of insurance. Active Tree Services also seeks indemnity or contribution from the Council and from Prestige. The risk of harm to visitors to Hyde Park 9 Many members of the public visit Hyde Park North on every day of the week. The Hill's weeping figs grow over paths where they walk and lawns where they lie and sit. So it was at the time of these events. The figs were planted early last century during the restoration of Hyde Park following construction of the city railway. Unfortunately, they were planted too close together and as a result they formed a more or less unbroken canopy. Trunks and branches which have to compete for light tend to become longer and thinner than they otherwise would. So it was with the Hill's weeping figs. The trees were under stress. 10 Hill's weeping figs tend to have a condition called included bark. The condition affects the junctions of co-dominant stems, that is members of equal or about equal size and deviating from one another at an acute angle, each trying to form the main trunk or branch. The bark covering the common wood at and immediately below such junctions sometimes intrudes into the wood. When it does, the junction is weakened so that a given amount of lateral force, which would not normally damage the tree, may cause the stems to part and the joint to fail. The external bark at junctions so affected takes on a characteristic appearance, so the presence of included bark can be ascertained by external inspection. However, a close look is needed and such an affected junction high in a tree may not be detectable or easily detectable from ground level. 11 The Council received advice about the trees in Hyde Park well before these events. One example was a report from Ralph H Clark, Tree Surgeon, dated 24 May 1988. Mr Clark criticised the design and maintenance of Hyde Park. He said that the figs, particularly those in the avenue, had been allowed to become too large and too heavy, with dead and dangerous wood. He observed that the Council had no program for the removal of dangerous trees and for the management of other trees in need of attention. 12 Another document the Council had was a report written for the Council on 23 January 1996 by a firm called Arborcraft. The report remarked on the root damage occasioned to the Hill's weeping figs by compaction of soil from excessive watering of plants growing under them and from trenches dug to install electrical cables. The report continued - Hill's Figs can have included bark. In Hyde Park South and other Sydney parks, mature specimens have failed. The defect is easy to see, but the outcome is not easy to predict. (Appendix 6) 13 The report went on to deal with root rot fungus and continued - The trenching, the tendency to have included bark, and the presence of a root rot fungus are wild cards that will have an impact on Hyde Park North over the next 20 years. It is possible that the avenue effect will be lost in some areas. 14 Appendix 6 was as follows – 6. CO-DOMINANT STEMS Definition : Two stems or trunks of equal size developed from two apical buds at the tip of the same stem. There are no branch collars at the bases of co-dominant stems; there is no "built-in" protection zone. A stem bark ridge separates the two stems from each other. When the stem bark ridge turns upwards, there is a strong union between the stems regardless of the angle of the stems. When the stem bark ridge turns inward or when there is a crack between the stems, there is a weak union regardless of the angle of the stems. Therefore the type of the union and not the angle is the major factor (see figures 1 and 2). Included bark is bark which remains between branch and trunk or between co-dominant stems. It occurs when the cambium turns inward and its most common occurrence is between co-dominant stems. Co-dominant stems with included bark and a downward stem bark ridge are weak. Co-dominance can be quite normal with some species particularly when they reach their mature form and size. Recommendations : * do not buy plants with co-dominant stems with included bark * do not vegetatively propagate from trees with this defect * if co-dominant stems are to be removed it is best done early – see figures 3 and 4. Note: - a strongly attached co-dominant stem need not necessarily have to be removed. * another option is to prune a new stem more than the other – the stem with more pruning will grow more slowly and the other will form a collar about it * on older stems, cabling may be another option * trees with serious defects may have to be removed. 15 The Appendix incorporated a series of diagrams illustrating the appearance of joints with normal bark and joints with included bark. 16 The Council engaged a further arborist, Garry Clubley, to write a review commenting on the Arborcraft report and its recommendations. Arborcraft's recommendations had concentrated on the consequences of the presence of the fungal diseases Armillaria and Phytophthora and made recommendations for dealing with trees affected by those diseases. So did Mr Clubley's review. Mr Clubley did not mention included bark. There were, however, these passages - 1.2 The Arborcraft Report provides a basic overview of the condition of the identified trees, and specifies tree removal/tree surgery work to rectify observable potential hazards, ie: removal of dead branches, etc. Some general comments in respect of tree management are also included in the report. 1.3 The comments in the Arborcraft Report conform to recognised tree management practices and contemporary knowledge in respect of tree biology/physiology. Why the branch fell 17 On the day of Mrs Choi's injury, Miss Kim telephoned Mrs Choi's father in Korea and he asked her to photograph the tree. She returned to Hyde Park on the following day and did so. In due course, prints of Miss Kim's photographs were delivered to an arborist, Mr David Ford, qualified by Mrs Choi's solicitor. By that and other means Mr Ford was able to identify the tree from which the branch had fallen. He went to Hyde Park and examined the tree. It looked early in the hearing as though there would be an issue whether Mr Ford had reported on the very tree, but following Miss Kim's evidence that ceased to be a contentious matter. Realistically, defence counsel did not submit that there was any doubt about the correct identification of the tree. I am satisfied that Mr Ford, as well as Mr Atkins, an arborist qualified by the Prestige, reported on the tree from which the branch fell. 18 In his report of 19 July 2004 Mr Ford said this - The tree is a mature specimen of Ficus microcarpa 'Hillii' (Hill's Weeping Fig) with a trunk diameter of approximately 1200mm, dividing into two subtrunks with diameters of 900mm and 600mm. It is located in a double row of trees of the same species, with two specimens of Eucalyptus pilularis (Blackbutt) located nearby … It is an edge tree, with a poorly formed crown shape due to competition. The crown overhangs a footpath which has a high frequency of foot traffic, and a grassed area which contains sculptures and fountains. The tree is in good health and in fair structural condition. It has been suppressed by nearby trees, so that the crown is drastically offset towards the west and southwest and the bulk of the crown scaffold is not located over the trunk. Crown spread to the east is negligible but to the west is approximately 20m. Deadwood to a diameter of approximately 100mm is present in the crown. Pruning cuts are present in the lower and central crown areas. The tree does not appear to be subject to insect attack or infection by disease. However the root rot fungal disease Armillaria luteobubalina is known to have caused the deaths of trees in the avenue, both in Hyde Park North and South (Sydney Morning Herald 15 May 2004). Debilitation as the result of root rot diseases would predispose the tree to shed branches. The lower trunk divides into two subtrunks at a height of approximately 3m. Of the two subtrunks, one (600mm diameter) is almost vertical and the other is inclined at about 30 degrees towards the southwest. This latter subtrunk divides into two parallel branches. One of these two branches has a long bark rip evident at a point approximately 15m from the main lower trunk… This wound is the result of a failed junction between two branches, and I am informed that the falling branch section caused the injury to your client. The failed branch does not appear to be affected by insects or disease. Just below the bark rip, a distinct inclusion line is visible on a junction in the main branch, evidence of another, larger, weak junction … Beyond this point, another bark inclusion is present on the outer branch junction … These two defects are clearly evident from the ground with the naked eye. The subject tree is atypical of the species, having been suppressed and malformed by competition from nearby trees. As a result, the major branch supporting the failed section has a long cantilever in excess of approximately 20m from the trunk, and is severely endweighted. This weak scaffold overhangs highly trafficked areas. Comment The species Ficus microcarpa 'Hillii' (Hill's Weeping Fig) is well known for its habitual production of poor trunk and branch junctions. These junctions are prone to failure due to the bark being 'included' in the junction. In a well-formed junction the bark at this point rolls outwards so that growth increments can take place. In these defective junctions the bark rolls inwards so that the junction becomes weakened as the included bark expands within the joint. This is also termed a 'compression fork'… and 'is a structure that is absolutely bound to fail if a tensile load is applied at right-angles to the axis of the stems, pulling them apart'… Junctions of codominant stems (ie stems of about equal diameters) are particularly prone to included junctions… The subject junction (noted in this discussion as Fork A) failed due to a bark inclusion; inrolling bark is present at the apex of the wound and is evident from the ground … The two stems were approximately equal diameters and were joined with an acute included angle. It is possible that the presence of this weak fork was obscured prior to failure by its position in the upper crown and by the orientation of the junction: the lower stem, now no longer present, may have been in a position to conceal the presence of the bark inclusion when viewed from below. However, a line of included bark would probably have been present along the side of the junction, and there would probably have been some increase in stem diameter at that point. Regardless, the narrowness of the included angle between the stems would strongly suggest the presence of a compression fork. These symptoms are a frequent occurrence in this species, which is noted for such defects. If present, the symptoms would have been visible from the ground. Fork B: a junction between two codominant stems occurs in a branch below fork A. This junction is similar to the failed junction, and is equally prone to failure. The two sets of stems are similar in diameter. A line of included bark is visible along the side of the junction… Fork C: closer to the trunk, on the same branch, is another weak junction between two codominant stems, the upper of which supports Fork A. A line of included bark is visible along the side of the junction. Swelling of the stem at the point of the junction is visible from a position on the ground below the branch…, showing that additional wood is being deposited in an attempt by the tree to compensate for weakness. This is a larger fork than either Fork A or Fork B and is equally prone to failure… A routine inspection of the tree for the purposes of tree maintenance or hazard assessment should have detected at least the defects in Forks B and C, even if the defect in Fork A was not fully visible. Remediation of the weak junctions at Forks B and C either by closer inspection or by pruning operations would then have brought Fork A to notice. The weak structure of Fork A, once identified, certainly required action to be taken, since the failure of this junction would have been entirely predictable. The future failures of Fork B or Fork C are also entirely predictable events. The predisposition to failure is evidenced by the presence of bark inclusions, visible from the ground. Any reasonable assessment of the subject tree should detect these defects, and either aerial inspection or pruning should be undertaken. 19 Mr Ford appended to his report photographs of the tree, showing the scarred limb from which the branch had fallen and the other forks discussed in the report. He referred to those photographs in appropriate places. He also referred to the opinions of expert writers on the subject of co-dominant stems and included bark. 20 Service of Mr Ford's report prompted Prestige to qualify an arborist, Mr Atkins, who wrote a report and a supplementary report on 16 November 2004. Mr Atkins inspected the tree on 4 November 2004. He observed that there were "wounds" from previous pruning all along the major scaffold branches, mainly in the lower parts of the canopy. He estimated that the pruning had been done within the last ten years. He said that the canopy spread towards the east for approximately three metres and to the west for approximately nineteen metres, a growth pattern he described as phototropic (turning towards the light). The result, he said, was a disproportionate amount of foliage and branching on the western side. He saw the wound caused by the failure of the branch that caused Mrs Choi's injury and estimated that the missing branch would most likely have been similar in size to the limb from which it tore loose, which was about 150 – 200 millimetres in diameter. He included in his report of 16 November 2004 a photograph of trees in the avenue showing phototropic growth and disproportionate canopy form. Mr Atkins noticed a distinctive pattern to the wound wood that indicated that bark was included within the fork at the branch union. He thought that the likely cause of failure was the presence of co-dominant branches and bark included in the branch union. 21 In their oral evidence Mr Ford and Mr Atkins confirmed their opinions about the probable cause of the failure of the branch. There is no evidence that might suggest that the branch was dead, dying or diseased. There is no evidence to suggest that the failure might have resulted from a high wind. There is no evidence to suggest that the joint failed because the roots of the tree were affected by fungal disease. 22 Miss Kim estimated the length of the branch at 1.5 metres, but I do not regard her as a good judge of such matters. It seems more likely that, like its co-dominant partner, the branch was in the order of seven or eight metres long. That was the opinion of Mr Atkins and Mr Willcocks, the managing director of Active Tree Services. 23 I am satisfied that the phototropic growth of the branch towards the west caused it to become significantly end-weighted and that the tree became unable to bear its weight at a fork weakened by included bark. Was the risk of harm reasonably foreseeable? 24 Mr Ford and Mr Atkins prepared individual reports, which came into evidence. They also prepared joint reports. The second of those reports, exhibit T, was written during the trial after Mr Ford and Mr Atkins had been furnished with copies of relevant exhibits and a copy of the transcript of the evidence of relevant witnesses. Some of the questions they were invited to answer were taken from the particulars of negligence pleaded by Mrs Choi against the Council and Prestige and some from a series of questions posed by Mr Ford in his supplementary report of 6 October 2006, exhibit A tab 3. Mr Ford and Mr Atkins gave simultaneous oral evidence. 25 Both experts were of the opinion that it was well-known in the arboricultural industry in Sydney between 1998 and 2000 that the Hill's weeping fig was prone to defects that could lead to limb failure. Those defects included the one known as included bark. The experts also agreed that close planting, with consequent restriction of light and elongation of limbs, would have been recognised by arborists as increasing the risk of failure of joints with included bark. 26 I conclude from this evidence that any person competent in the management of trees would have recognised from the fact that the trees in the avenue were Hill's weeping figs, with their known tendency to include bark, that had developed long, end-heavy branches on the western side overhanging lawns used by visitors to the park, that there was a risk that these conditions might combine to cause a joint to fail, with consequent risk of injury. 27 Such recognition would not, of course, have identified which trees, if any, presented that particular danger, but a competent manager would have realised the need to inspect the trees in order to identify any that did. 28 The experts agreed that close inspection would have been needed to identify the presence of included bark at any joint. Mr Atkins remarked on the crowded state of the canopy and considered that any inspection of the higher parts of the trees could be properly done only by the use of an elevated work platform. Mr Ford agreed, though he thought that much could be detected from an inspection at ground level. 29 I have extracted above Mr Ford's statement of opinion that the two joints below the one that failed could be identified from ground level as having included bark. Mr Atkins did not agree. He thought that ridges of bark and swellings that might indicate the presence of included bark might be apparent from a ground level inspection, though he could not identify the fault accurately from that level. Both experts agreed that the failed joint was high in the canopy. Obviously, other growth might at the time have obscured it from an inspection at ground level. 30 Although I am not satisfied that the presence of included bark could have been ascertained from ground level, I am satisfied that the condition of the tree, including the appearance of the two lower forks noted by Mr Ford, would have led a reasonable manager to carry out a close inspection at height. I am satisfied that such an inspection would have revealed the presence of included bark and would have alerted the manager to the danger presented by that particular fork and branch. 31 There were at the time means of lifting personnel into the canopy for close inspection. For example, Active Tree Services used elevated work platforms routinely in the course of its work. Once detected, the danger could have been removed by lopping at the affected junction and, perhaps, at the two other junctions identified by Mr Ford. 32 In my opinion the risk of harm to visitors was foreseeable. The management of Hyde Park North; contractual relations between the Council, Prestige and Active Tree Services 33 Until 1998 the Council managed Hyde Park North by the labours of its own staff but contracted out the management of Hyde Park South. Prestige was a contractor. The services it offered were wide-ranging, including the management of gardens, turf management, cleaning and tree care. It sublet the arboricultural work for Hyde Park South to Active Tree Services. The Council knew this. 34 Late in 1996 the Council decided to invite tenders for the management of a number of its parks, streets and spaces, including Hyde Park North and Hyde Park South. The services called for were of several kinds and related to streets and parks across the municipality. 35 By cl 1.4 of the Conditions of Tender issued by the Council to intending tenderers the request for tender comprised the following - (1) the Conditions of Tender (2) the Tender Form (3) the General Conditions of Contract (4) the Specification (5) the drawings; and (6) the Addenda 36 Cl 1.5 was as follows - 1.5 Addenda Council may issue Addenda from time to time and at any time prior to the Closing Date. Addenda may be issued to clarify the Request for Tender or to effect modifications to the Request for Tender. Each Addendum will be issued to all Tenderers and upon issue will form part of the Request for Tender. Receipt of each Addendum must be acknowledged by the Tenderer in Part 19 of the Tender Form. Council may consider any Tender submitted without acknowledgement of all Addenda to be non-conforming. 37 The General Conditions of Contract included these terms - 1. In this Agreement, unless the context otherwise requires: … (aa) " Services " means the services to be performed by the Service Provider, as set out in Schedule 1 and includes additional services or services of a higher standard provided in the Tender, if any, and any other services agreed by Council and the Service Provider and where provision is made in the Specification for goods or other materials (e.g. plants and trees) also to be provided by the Service Provider, references to Services shall be deemed to mean the provision of services or goods and materials and services, as applicable; … 2.1 Council appoints the Service Provider to provide the Services on the terms of this Agreement and the Service Provider accepts the appointment. … 3.1 The Service Provider shall perform the Services: (a) at the times and in the manner specified in the Specification; (b) in a conscientious, diligent and professional manner, which is higher than or equal to the degree of skill, care and diligence normally exercised by recognised professional persons which supply services of a similar nature; … 16.7 Without limiting the generality of the foregoing the Service Provider shall: (a) ensure all employees, agents and sub-contractors of the Service Provider involved in providing the Services are fully qualified or trained for the work and satisfactorily complete any training required by Council from time to time; (b) ensure all employees, agents and sub-contractors of the Service Provider comply with any lawful direction of the Contract Manager in the event such direction is given for the safety of the public (such as in the case of fire); (c) by fully responsible for the acts and omissions, whether negligent or otherwise, of its employees, agents and sub-contractors and shall ensure that all of them fully comply with the terms of this Agreement; (d) evaluate the performance of all personnel engaged in connection with the provision of the Services from time to time as requested by Council and at least annually and provide a copy of all such evaluations to Council within ten (10) Business Days of their completion by the Service Provider; and (e) establish (to the extent not established at the date of this Agreement) and maintain an effective occupational health and safety system to ensure a safe system of work. … 17.1 The Service Provider will advise Council of the details of any sub-contractors which it wishes to engage to provide Services. No sub-contractor shall be engaged by the Service Provider to provide Services without the prior consent of Council. The Service Provider shall be fully responsible for the performance of the Services notwithstanding the consent of Council or that the Service Provider has sub-contracted the performance of any part of the Services. … 20.1 The Service Provider shall indemnify, and shall at all times keep indemnified, Council, its offices, employees, agents and contractors (and their employees and agents) from and against loss, damage, expense (including legal costs on a solicitor-client basis) and other liability which they may incur or sustain arising from any claim, demand, action suit or proceeding that may be made or brought by any person against Council, its officers, employees and contractors for, or as a consequence of, any act or omission or any negligence by the Service Provider, its employees, agents or sub-contractors or otherwise arising directly or indirectly from the provision of the Services or failure to preform or observe the terms of this Agreement, including all loss, damage or injury to persons or property caused or contributed to by the Service Provider, its employees, agents or sub-contractors and including any personal injury to or death of any person. … 20.3 The Service Provider's liability to indemnify Council shall be reduced proportionally to the extent that any negligent act or omission or wilful default by Council or its employees or agents may have contributed to any loss, damage, death or injury referred to in clauses 20.1 or 20.2. … 25.1 The relationship of Council to the Service Provider is that of principal and independent contractor and the Service Provider shall perform the Services and all acts and agreements related thereto, whether or not requested by Council, in and to promptly arrange such written undertakings to be given by its employees or subcontractors engaged in the performance of the Services. … 31 WHOLE AGREEMENT 31.1 This Agreement supersedes any and all agreements between the parties, whether oral or written, in relation to the matters referred to herein. 31.2 This Agreement consists of all the documents listed in clause 32 in their order of precedence and constitutes the entire agreement of the parties in respect of its subject matter and its terms and conditions shall not be varied by the parties other than in writing. 32 PRECEDENCE 32.1 In the event of any inconsistency between the documents constituting the Agreement, the order of precedence shall be as follows, with the first document listed prevailing over the second document, and so forth; (a) the Special Conditions, (b) Schedule 1 to the General Conditions of Contract (c) the Specification (d) the Tender (e) the Request for Tender 38 Schedule 1 provided in part - Services (clause 2.1) see the Request for Tender and the Specification and includes: Additional Services or services of a higher standard provided in the Tender (if any); and any other services agreed by Council and the Service Provider. 39 Volume 1 of the Request for Tender comprised conditions including these - 1.6 Precedence of Documents To the extent there is any inconsistency between: (a) an Addendum and the Request for Tender, the Addendum shall prevail; and (b) two or more Addenda, the last issued Addendum shall prevail. … 14 Tenderer to Rely on Own Enquiries 14.1 All information in the Request for Tender and in a briefing, if any, is provided for the assistance of Tenderers only and no representation or warranty is made by or on behalf of Council concerning the information. 14.2 Council shall not be liable for any representations or warranties made or purportedly made by Council's agents or any other person or company on Council's behalf, whether in the Request for Tender, the briefing (if any) or otherwise. 14.3 Tenderers acknowledge in receiving this Request for Tender and in submitting any Tender that they have relied entirely on their own knowledge and enquiries and they do not rely on any warranties or representations made to them by or on behalf of Council including those contained in this Request for Tender. … 17.1 Tenderers must read and understand all Parts of the General Conditions of Contract. Tenderers should particularly note the following provisions of the General Conditions of Contract, unless indicated otherwise in the Specification: (a) Standard of Services (clauses 3.1 and 3.2). Services must be provided to the standard set out in the Specification and the General Conditions of Contract, or at least in a conscientious, diligent and professional manner. (b) Use the premises (clause 4 and Part 12 of the Tender Form). If the Specification and the General Conditions of Contract indicate these provisions apply, Tenderers must be aware of the limitations on the use of Council Premises and the obligations in clause 4. (c) Security Requirements (clause 9.1). Tenderers must comply with Council's security requirements in using Council Premises. (d) Industrial Relations and Occupational Health and Safety (clause 9.2). Tenderers must comply with the requirements of clauses 9.2 (c), (d), (e) and 16. (e) Intellectual Property (clause 15). Tenderers must be aware of the provisions of clause 15 in relation to Intellectual Property used or created in the course of providing the Services. (f) Sub-contractors (clauses 16 and 17 and Part 9 of the Tender Form). All proposed sub-contractors must be approved by Council before their engagement by the Service Provider. The Service Provider remains responsible at all times for ensuring the sub-contractor meets all requirements of Council in the Request for Tender and the General Conditions of contract. (g) Insurance (clauses 20.4 and 20.5). Tenderers must comply with the insurance requirements of clauses 20.4 and 20.5. (h) Indemnities (clauses 19.2, 20.1 and 20.2). Service Providers are required to indemnify Council in the manner provided including the circumstances set out in clauses 19.2, 20.1 and 20.2. (i) Termination (clauses 21 and 22). Certain acts or omissions of Service Providers will entitle Council to terminate the General Conditions of Contract immediately under clause 21. Council may also terminate if a breach of the Service Providers obligations remains unremedied following notice under clause 21. (j) Banker's Undertaking (clause 26). Tenderers must provide a Banker's Undertaking guaranteeing the Service Provider's obligations under the General Conditions of Contract. (k) Performance Guarantee (clause 27). Guarantees of the Service Provider's obligations under the General Conditions of Contract must be provided in the form specified by Council. (l) Codes of Conduct (clauses 3.5, 4.3 and 5.1). Tenderers must comply with all applicable codes of conduct of Council, in addition to any other express or implied obligations under the General Conditions of Contract. 40 Volume 2 of the Request for Tender comprised the Specification. It included the following terms - 3.3 TREES The requirement is to maintain healthy well formed, attractive trees, free of diseases, insects, deadwood and damage by utilizing the latest arboricultural technology and to apply maintenance procedures in accordance with this specification. Maintenance of tree guards and tree surrounds in Street Trees is NOT a requirement of this Contract and will be the responsibility of another Service Provider. The Service Provider shall be required to undertake the following: (a) The Service Provider shall include a program for tree maintenance in the Quality and Operational Plan. The Service provider shall outline all relevant details relating to maintenance of trees in Parks, Open Space Areas and Streets and provide for a minimum one year cyclic program; (b) The Service Provider shall monitor, record and report the condition of all trees in Parks, Open Space Areas and Streets and submit a report to the Contract Manager each month; (c) The Service Provider shall remove all dead, dangerous and fallen branches in accordance with the best practices of the Arboricultural Trade and dispose of the same from site; (d) The Service Provider shall make provisions for the adequate watering of trees. The Service Provider shall propose his arrangements for the watering of the trees during dry spells, when there may be Sydney Water restrictions on the use of water, to the approval of the Contract Manager. The proposals should ensure survival of the trees during the dry spell, as any trees which die as a result of the Service Provider's failure in watering are to be replaced with trees of the same species and similar maturity at the Service Provider's expense; (e) The Service Provider shall be required to maintain levels of mulched areas around Street Trees to ensure public safety; (f) The Service Provider shall provide minimum clearance between tree branches and the following: · Pedestrian paths 3 metres · Access roads 4 metres · Service wires 0.5 metre · Lighting As required to provide illumination · Building/structures 1 metre · Awnings 1 metre (g) The Service Provider shall give priority to clearance orders from Energy Australia and undertake work in accordance with Energy Australia's Codes of Practice. (h) The Service Provider shall provide a minimum of one week's prior notice to residents affected by the removal of a tree except in the case of an emergency. (i) The Service Provider shall remove stumps within one week after removal of a tree and provide adequate safety barriers, lights etc in the interim period. … 5.18 MONTHLY REPORT The following information shall be provided by the Service Provider and must be forwarded to the Contract Manager by the end of the third week of the every month: (a) An inspection report for each area confirming completion of all maintenance in accordance with the specification and the details of any remedial work required (eg pest/disease treatment); (b) Tree condition report; (c) Park and Open Space Lighting Inspection Report; (d) Inspection Report for Monuments, Sculptures, Fountains and Art Works; (e) The total hours worked by the employees during the claim period; (f) Any changes to management personnel; (g) Industrial relations issues; (h) A list of complaints, requests and inquiries; (i) Any initiatives or improvements implemented; (j) Risk management issues. The report should also include details of any incident or accident which is the subject of a workers compensation claim, damage to public property or which involves the public. 41 Volume 3 comprised General Conditions of Contract, to which I have already referred. 42 Mr Craig McCallum, Managing Director of Prestige, wished to tender but to engage Active Tree Services to do the tree maintenance called for in the tender, or the greater part of it. He knew Mr Willcocks. He telephoned him and told him that Prestige was putting in a tender to manage parks and trees in the city. He said that he would send him part of the tender documents concerning the trees and asked for Active Tree Services to quote for some of the work. Mr Willcocks agreed to quote and asked to be sent a description of the work. Mr McCallum sent Mr Willcocks two pages from the Specification which included cl 3.3, which I have set out above. 43 Mr Willcocks read the document and spoke again to Mr McCallum. He said "It is a very broad Specification. We can't do all of it. We will come back with a proposal". Mr Willcocks made some enquires and spoke to one of his managers. On or about 16 January 1998 he wrote a letter, mistakenly dated 16 January 1997, in these terms - Prestige McCallum Landscape Management 22 Bridge Road GLEBE NSW 2037 Attn: Mr Craig McCallum Dear Craig RE: MAINTENANCE OF PARKS , OPEN SPACE AREAS AND STREET TREES - TENDER NO. 9754 CITY OF SYDNEY. I have inspected all the parks, open space areas and street trees. We intend to use different crews for the parks and the street trees. The specification as we have discussed, is very brief and also very broad or all encompassing. The following is the procedure we intend to use. STREET TREES It is our intention to proceed to prune all the street trees in one single pass, working through the City in a methodical pattern. There are many roads with traffic restrictions, almost permanently parked cars and high volume pedestrian traffic, that will require special attention at hours that suit the work, so at times we will be moving to quite different parts of the City at appropriate hours of the day. We are considering working in the late afternoon or evening using hydraulic equipment to minimise noise to get safe access to a number of sites. The time frame for this work would be 4 months from commencement of the contract, and then 3 months in subsequent years. The work performed would be: 1. As per 3.3F in the Specification, with the exception of the clearances from buildings and awnings. In this case we would clear, when the trees appeared to be damaging the building or on request, as often the residents do not want the branches removed. 2. Removal of deadwood above 20mm diameter. Removal of any broken branches or any branches that show regular damage from vehicles. 3. Clearance of all powerlines as per the requirements of Energy Australia, including trees growing out of parks into the conductors. 4. Record the number of trees worked on in each street, the predominant species and the number of each activity, any trees not worked on requiring additional work. The crew make-up would generally be 3 personnel, with an EWP and a tipper/chipper. The EWP will be insulated and designed to work without outriggers. Staff will be trained in the following, as appropriate: a) 5099 Certificate of Exemption; b) Tree Care for Electrical Workers; c) Chain Saw Safety Awareness Certificate; d) First Aid; e) Traffic Control; f) EWP Certificate of Competence; g) Manual Handling; h) Wood Chipper Safety Awareness; i) An induction course for the requirements of this contract. PARK/OPEN SPACE TREES This work will be programmed for an even spread of work for the year. I have included a probable schedule, but we may flex the schedule when we have specialised equipment available or to accommodate events in the areas. The work performed will be: i) Clearance of lights, pedestrian and access roads as per 3.3F ii) Removal of deadwood above 20mm diameter in high traffic areas and as appropriate in other areas; iii) Removal or pruning of damaged branches; The crew will be 2 or 3 personnel, and generally will be a crew experienced in advanced climbing techniques using ropes. We will also use a truck mounted EWP or a boom lift, as required. In general the trimmings will be chipped or taken back to our yard for grinding. At least one person will have completed "Arboricultural Techniques" as taught by T.A.F.E. The contract will be managed by Peter Dubiez, and the technical management by John Sheely. (A brief resume of each is included and also those of other key staff. We have allowed within our rates for emergency work in the event of occasional damage by vandals or storms, provided that minor damage that can be reached from the ground, and any small fallen branches are handled by yourselves, and in the event of a major storm, we would be paid for the work. In the event that we do not have staff available working on the contract, as is likely in years 2 to 5, we have a large number of crews available. We provide 24-hour services for Energy Australia and Integral Energy, and have about 60 personnel working in the Sydney area. We have previously supplied up to 40 staff for major emergencies for up to 4 months. ADDITIONAL SERVICES TO BE OFFERED From our inspection of the Parks and streets, there are a number of mature trees that pose a risk to the public, because they have a habit of dropping large branches. This risk could be reduced by suitable pruning and crown reduction. There are also a number of unsuitable trees that should be replaced. I believe that a comprehensive inventory of these unsuitable trees should be done at the commencement of the contract, and a list should given to the Council. This would take about one month to visit and document, and the cost would be $9,000.00. I would recommend that a total inventory and data base be established for trees in streets and parks. We are the Australian distributor for "TreeKeeper", a tree management software program developed by the Davey Tree Company. Davey are the largest municipal and domestic tree contractor in the U.S. They employ over 4,000 staff and have a substantial R&D section. Treekeeper has over 200 users worldwide and TreeKeeper Junior is distributed by the International Society of Arboriculture. The City of Hume is currently installing TreeKeeper. The advantages of a data base are many, but include: 1. A total inventory of all trees from which information such as distribution by species, age and condition can be determined; 2. All maintenance of trees is recorded, allowing a comprehensive history to be recorded. This allows an analysis of the suitability of trees by species and location and for liability an accurate record. Many queries relating to a tree can be answered from the computer screen. The system we are currently offering is a gaper record which is not readily referenced. 3. Routine maintenance programs can be generated by species or site, or type of equipment required. This means more efficient use of plant and staff i.e. the location of all Moreton Bay Figs. 4. Non-routine maintenance can be stored and then programmed in an efficient manner. 5. Data can be recorded electronically by field staff and the results down-loaded directly on a daily or weekly basis. We are currently using "Touch Screen" computers to record daily activities on Energy Australia contracts, and have built up a comprehensive data base on the sites and trees we trim. Information about the system is included (Appendix D). I have enclosed information about TreeKeeper (Appendix E). I believe that within a few years it will be normal for councils to have this type of information. Treekeeper can use GIS such as MAP INFO. There is a different software for Parks called "ParkKeeper". 44 There followed a description of Active Tree Services, including the kind of work they had done and for which principals as well as other information about the company and a description of the experience of Mr Willcocks and a number of the senior employees of the company. Also annexed were quoted prices. 45 In due course Prestige made its tender. In fulfilment of its obligation to identify any subcontractor it intended to use, it included this statement on its letterhead - Major tree maintenance would be carried out by: Active Tree Services 9 McCowan Road INGLESIDE NSW 2101 Street Trees It is the intention of Active Trees to proceed to prune all the street trees in one single pass, working through the City in a methodical pattern. There are many roads with traffic restrictions, almost permanently parked cars and high volume pedestrian traffic, which will require special attention at hours that suit the work, so at times we will be moving to quite different parts of the City at different hours of the day. It is considered working in the late afternoon or evening using hydraulic equipment to minimise noise and to get safe access to a number of sites. The time frame for this work would be 4 months from the commencement of contract, and then 3 months in subsequent years. The work performed would be: 1. As per 3.3F in the Specification, with the exception of the clearances from buildings and awnings. In this case we would clear, when the trees appeared to be damaging the building or on request, as often the residents do not want the branches removed. 2. Removal of deadwood above 20mm diameter. Removal of any broken branches or any branches that show regular damage from vehicles. 3. Clearance of all powerlines as per the requirements of Energy Australia, including trees growing out of parks into the conductors. 4. Record the number of trees in each street, the predominant species and the number of each activity, any trees not worked on requiring additional work. The crew make-up would generally be 3 personnel, with an EWP and a tipper/chipper. The EWP will be insulated and designed to work without outriggers. Staff will be trained in the following, as appropriate: a) 5099 Certificate of Exemption b) Tree Care for Electrical Workers c) Chain Saw Safety Awareness Certificate d) First Aid e) Traffic Control f) EWP Certificate of Competence g) Manual Handling h) Wood Chipper Safety Awareness i) An introduction course for the requirements of this contract. Park/Open Space Trees This work will be programmed for an even spread of work for the year. A probable schedule is included, but may be altered when we have specialised equipment available, or to accommodate events in the areas. The work performed will be: i) Clearance of lights, pedestrian and access roads as per 3.3F ii) Removal of deadwood above 20mm diameter in high traffic areas and as appropriate in other areas iii) Removal or pruning of damaged branches. The crew will be 2 or 3 personnel, and generally will be a crew experienced in advanced climbing techniques using ropes. ATS will also use a truck mounted EWP or a boom lift, as required. In general the trimmings will be chipped or taken back to the yard for grinding. At least one person will have completed "Arboricultural Techniques" as taught by TAFE college. Tree Maintenance will be managed by Peter Dubiez, and the technical management by John Sheely (a brief resume of each is included and also those of other key staff). Active Trees provide 24 hour services for Energy Australia and Integral Energy, have about 60 personnel working in the Sydney area, and have previously supplied staff of up to 40 for major emergencies for up to 4 months. Additional Services to be Offered Following an inspection of the Parks and streets, there are a number of mature tees (sic) that pose a risk to the public, as they have a habit of dropping large branches. This risk could be reduced by pruning and crowd (sic) reduction. There are also a number of unsuitable trees that should be replaced. It is suggested a comprehensive inventory of these unsuitable trees be done at the commencement of the contract, and a list should be given to the Council (at an additional charge to Council). It is recommended that a total inventory and data base be established for trees in streets and parks. Active Trees are the Australian distributor for "TreeKeeper', a tree management software program developed by the Dave Tree Company. Davey are the largest municipal and domestic tree contractor in the US. They employ over 4,000 staff and have a substantial R&D section. TreeKeeper has over 200 users worldwide and TreeKeeper Junior is distributed by the International Society of Arboriculture. The City of Hume is currently installing a TreeKeeper. The advantages of a data base are many, but include: 1. A total of all trees from which information such as distribution by species, age and condition can be determined. 2. All maintenance of trees is recorded, allowing a comprehensive history to be recorded. This allows an analysis of the suitability of trees by species and location and a reliable accurate record. Many queries related to a tree can be answered from the computer screen. 3. Routine maintenance programs can be generated by species or site, or type of equipment required. This means more efficient use of plant and staff i.e. the location of all Moreton Bay Figs. 4. Non routine maintenance can be stored and then programmed in an efficient manner. 5. Data can be recorded electronically by field staff and the results down loaded directly on a daily or weekly basis. ATS currently use "Touch Screen" computers to record daily activities on Energy Australia contracts, and have built up a comprehensive data base on the sites and trees we trim. Information about the system is included(App D) Enclosed is information about TreeKeeper (App E). Active Tree believes that within a few years it will be normal for Councils to have this type of information. TreeKeeper can use GIS such as MAP INFO. There is a different software for Parks called "ParkKeeper". 46 There followed a description of Active Tree Services, its Managing Director and principal employees, taken from Active Tree Services' letter to Prestige. 47 During the tender period the Council issued a number of Addenda. Addendum number four comprised a number of questions asked by intending tenderers seeking clarification of the Specification and the Council's responses. It included these questions and answers - Q1. Council would have inventories of trees, litter bins, street/park furniture and irrigation installations etc. What procedure or process can we follow to obtain this information? A. Unfortunately, no inventories are available. … Q10. Under section 3.3 (b) of the Specification, the Service Provider is required to monitor, record and report the condition of all trees and report to the Contract Manager each month. Is there are prescribed frequency of inspection for each tree? If not, would a yearly inspection in keeping with the yearly maintenance cycle satisfy Council's needs? A. Yes, monthly inspections are to be undertaken, reporting only those trees affect by disease, damage or insects. … Q12. Section 3.3(c) of the Specification calls for the removal of all deadwood in accordance with arboricultural best practice. Section 8.3 of the Australian Standard for Pruning of Amenity Trees (AS 4373-1996) states in relation to deadwood that a minimum diameter of branches to be removed shall be specified. In the majority of contracts currently performed by ************ , this minimum diameter is set at 20mm. We believe that a requirement to remove all deadwood may result in a considerable increase in tender prices but no real improvement in the appearance or health of the city's trees. We therefore request that a minimum diameter for deadwood removal be set and suggest 20mm or larger as an appropriate size. A. All deadwood, as specified, must be removed. … Q58. Are we to assume from Spec Clause 3.3b) that we are to inspect every tree in Parks, Open Spaces and Streets on a monthly basis or that we are to report on a monthly basis on those trees that were inspected during that month? A. See answer to Question 10. Q59. Does council have a Street Tree database? A. See answer to Question 1. 48 On 27 April 1998, eight days before the contract was formed, the Council sent to each of the remaining tenderers, including Prestige, a letter by facsimile transmission which included this passage – Under clause 16 of the Local Government (Tendering) Regulation 1993, [and clause 12 of the Conditions of Tender] (as the case may be) the Tender Evaluation Committee seeks further information by way of explanation or clarification regarding the following matters: 1. (a) Clause 3.3(c) of the Specification currently reads: 'The Service Provider shall remove all dead, dangerous and fallen branches in accordance with the best practices of the Arboricultural Trade and dispose of same from site;' (b) Clause 3.4.2 of the Specification provides: 'The Service Provider shall remove litter, garbage, glass, debris, spent leaves, branches and palm fronds and other extraneous materials from gardens, refuse containers, shrubbery, lawns and fountains within the Parks and Open Spaces Areas and arrange for the rubbish to be taken away on a daily basis.' (c) Clause 5.6 of the Specification includes the following: 'The Service Provider shall respond immediately to all situations directly or indirectly threatening the safety of the public.' Council considers that the Specification requires the removal of all dead, dangerous and fallen branches within 24 hours, with removal required immediately if the safety of the public is threatened directly or indirectly. Tenderers are requested to confirm that their tender was submitted on the basis of Council's interpretation of the Specification described above and whether the above matters can be accommodated within the Quality and Operational Plan and price as submitted with the tender. If not, tenderers must advise what the additional cost would be for provision of the service as described. 2. (a) Clause 2.2 of the Specification provides for an annual provisional allowance in the contract price of $50,000 for tree planting/removal. Clause 3.3(i) of the Specification currently reads: 'The Service Provider shall remove stumps within one week after removal of a tree and provide adequate safety barriers, lights in the interim period.' (b) Council considers that under the Specification it may require the replacement of dead trees within one week of notification by the Contract Manager, and that this is a matter which may be dealt with under the Specification and/or the General Conditions of Contract. Tenderers are requested to advise whether the above matters can be accommodated within the price as submitted with the tender, or if not, what the additional cost would be for the provision of the service as described. 49 On 28 April Prestige replied in a letter that included these passages - With reference to your facsimile dated 27th April '98 concerning street (sic) trees: Point 1: Requirement of all dead, dangerous and fallen branches within 24 hours, with removal required immediately if the safety of the public is threatened directly or indirectly. Reply: Prestige McCallum Landscape Management confirms this is the interpretation we have placed on this requirement and no additional cost would be passed onto the council. 50 Notwithstanding the terminology of Prestige's reply, the correspondence was not confined to the requirements for street trees. The parties were referring to trees in parks as well. It should be noted that in this letter Prestige, in using the term "dangerous branches", was reverting to the Council's use of that term in cl 3.3(b) of the Specification and its letter under reply, and departing from the sense of the statement in its tender, reproduced at para 45 above, which omitted the word "dangerous". 51 On 4 May 1998 the Council resolved to award Prestige the contract. The agreement was for an initial term of three years, commencing on 1 June 1998, with provision for a further term. Prestige was referred to in the contract as the Service Provider. Mrs Choi's case against the Council 52 According to the Draft Hyde Park Tree Management Plan 2006, issued by the Council in June 2006 (exhibit A tab 38), responsibility for Hyde Park was transferred from the Colonial Secretary to the Council in 1904. The action was conducted on the assumption that the Council had the duty to manage the park. It was in the exercise of that duty that it sought advice, published reports, called for tenders and let the tender to Prestige. 53 Where the Common Law duty of care resting on a defendant is the general duty to use reasonable skill and care, and if that skill and care can be exercised by a competent contractor, the defendant's duty will be satisfied or discharged by the engagement of such a contractor. This is especially so where the service or work to be done requires the exercise of skill or experience which the defendant does not possess. So there is a general rule that a defendant is not responsible for the wrongful acts committed by a contractor or the contractor's employees in the course of work which it was engaged to do. The same may be said for the wrongful omissions of the contractor or its employees. 54 Sometimes, however, the defendant's duty is said to be personal, non-delegable. Then, a defendant who engages a contractor assumes a duty to see that the contractor takes reasonable care for the safety of persons to whom the duty is owed: Kondis v State Transport Authority (1984) 154 CLR 672; Burnie Port Authority v General Jones Pty Limited (1992-1994) 179 CLR 520. 55 In the beginning Mrs Choi sued only the Council, and it was not until after the Council joined Prestige, pleading their contract, that Mrs Choi amended her Statement of Claim to assert that the Council's duty to her was non-delegable – see particular (g). As the amendment impliedly recognises, if the Council proves that it delegated the relevant duty to Prestige, Mrs Choi's action against the Council is apt to fail unless it is also made to appear that the Council's duty was non-delegable. 56 The rationale for making a defendant liable for the tortious act or omission of its contractor has been described in various ways. In Hollis v Vabu Pty Limited (2001) 207 CLR 21 at [40], the majority of the High Court of Australia said that in general, under contemporary Australian conditions, the conduct by the defendant of an enterprise in which persons are identified as representing that enterprise should carry an obligation to third persons to bear the costs of injury or damage to them which may fairly be said to be characteristic of the conduct of the enterprise. Reference was made to Bazley v Curry [1999] 2 SCR 534 where McLachlin J had used the term "enterprise risk" and had said that "where the employee's conduct is closely tied to risk that the employer's enterprise has placed in the community, the employer may justly be held vicariously liable…". There was reference to Bushey and Sons v United States (1968) 398 F2d 167 where the reference was to responsibility for accidents which may fairly be said to be characteristic of (the) activities (of the business enterprise). 57 In Hollis v Vabu Pty Limited it was held that these notions influence the meaning of "control" in the distinction between employees and independent contractors. As the Court said, however, it is not merely control but the whole of the relationship between principal and contractor that must be looked at. Plainly, the ability of the principal, in a practical sense, to control the operations of the contractor, is important. 58 There is this passage in the judgment of the majority of the Justices of the High Court of Australia in Burnie Port Authority v General Jones Pty Limited at 550 - 551 - In Kondis v State Transport Authority, in a judgment with which Deane J and Dawson J agreed, Mason J identified some of the principal categories of case in which the duty to take reasonable care under the ordinary law of negligence is non-delegable in that sense: adjoining owners of land in relation to work threatening support or common walls; master and servant in relation to a safe system of work; hospital and patient; school authority and pupil; and (arguably), occupier and invitee. In most, though conceivably not all, of such categories of case, the common "element in the relationship between the parties which generates [the] special responsibility or duty to see that care is taken" is that "the person on whom [the duty] is imposed has undertaken the care, supervision or control of the person or property of another or is so placed in relation to that person or his property as to assume a particular responsibility for his or its safety, in circumstances where the person affected might reasonably expect that due care will be exercised. It will be convenient to refer to that common element as "the central element of control". Viewed from the perspective of the person to whom the duty is owed, the relationship of proximity giving rise to the non-delegable duty of care in such cases is marked by special dependence or vulnerability on the part of that person. 59 The Council knew generally about the condition of trees in Hyde Park but had no particular knowledge of the tree which failed. It lacked the skill and experience necessary to identify defects of the kind present in the subject tree. It did not employ arborists. The Council knew that Prestige was a substantial company. Prestige had contracted for the Council before. The Council knew that Prestige would engage Active Tree Services to do the aboricultural work. It had reason to accept Active Tree Services as a substantial and reliable company. It had sub-contracted for work in Hyde Park South. 60 The Council went about its selection of Prestige with some care. The evidence establishes that it advertised for tenders for the provision of a wide range of services throughout the municipality. Sixteen responses were received. Six of those responding were considered not to have sufficient operational expertise, managerial ability and financial stability. After tenders closed, an evaluation panel considered the eight tenderers then remaining. The panel included an independent expert, Mr David Westall. 61 As Prestige informed the Council in its tender documents, it was established in 1957 and was a division of a group having an annual turnover approaching $100 million. It employed more than five thousand staff, employees and tradespeople. Prestige listed many important engagements it had had, some of which were known to the Council. Prestige had provided services in thirty per cent of the Council's parks and open spaces. 62 I have already mentioned Council's Specification, the Addenda and the further requirements made of tenderers. Cl 2.1 of the Specification was as follows - 2.1 General Objectives The mission of the Service Provider shall be to: · Maintain all Parks, Open Space Areas and Street Trees to a high standard and which ensures the preservation and enhancement of the public landscape assets of the City of Sydney; · Provide and conduct an efficient, effective and environmentally acceptable operation for maintaining a safe and aesthetic landscape environment within the Parks and Open Space Areas of the City of Sydney. 63 The Specification dealt with the scope of works to be done, including gardens, lawns, trees, refuse collection, park structures, signs and noticeboards, bollards, walls, fencing, playgrounds and exercise stations, drains and gullies, irrigation systems, parks and open space lighting, paved areas, furniture, barbecues, vermin control, monuments, sculptures, fountains and artworks. 64 In its tender Prestige stated that it would "maintain all parks, open space areas and street trees to a high standard which ensures the preservation of enhancement of the public landscape assets of the City of Sydney". 65 I have already mentioned the Council's knowledge of Active Tree Services. Active Tree Services was described by Prestige in its tender as "… possibly the only Australian firm providing such a complete range of tree services". 66 According to a Council report, Prestige was the only tenderer "that convincingly focused on performance achievement of the Specification; where senior and middle management were technically superior to that of the other tenderers in the areas of relevant tertiary qualifications, experience and skills; had a well-defined and established response procedures and quality control systems in place and had a history of satisfactory performance in the provision of similar maintenance services resulting in the renewal of contracts for Council, Olympic Co-ordination Authority, Sydney Water, RAAF Richmond and Parramatta Park Trust". 67 The contract was let to Prestige for more than $9 million over five years. The amount referable to Hyde Park North was $2.4 million. The greater part of that amount was for maintenance, including maintenance of trees. Prestige was not the lowest tenderer. 68 I am satisfied that the Council chose Prestige because it believed that it was the tenderer best qualified to carry out the contract. I am satisfied that it made its enquiries and stated its requirements in a careful manner and that it was entitled to come to the conclusion that it did. 69 The Council had no special arboricultural skill. It did not employ arboricultural staff. It noted that Mr McCallum, the principal of Prestige, described himself as an arborist and it knew that Active Tree Services had arborists on its staff or senior management. 70 In order to fulfil its contractual obligations in relation to trees, Prestige had to make a monthly report: see cl 3.3(b). It did so. Mr Beckett became responsible on behalf of the Council for overseeing the contract and he conferred fortnightly with Mr Adam Gersbach of Prestige. According to Mr Gersbach, Prestige's employees checked daily on the trees to make sure that there was nothing overtly dangerous or unusual that required attention. Worksheets and checksheets were prepared. A monthly report was prepared. 71 Mr Gersbach carried out monthly inspections in the company of senior employees of the Council, including Mr Beckett and his predecessor Mr Summergreene. 72 I am satisfied that the Council administered Prestige's contract in a careful way, requiring the submission of necessary reports and the like. Because Prestige, or more correctly its sub-contractor Active Tree Services, was expert and the Council was not, Council was in no position to know that a tree that ought to be inspected had not been inspected or that a branch that ought to have been identified as dangerous had not been so identified. Council was incapable of exercising control over the inspection of trees and of taking part in deciding whether anything needed to be done and of taking any necessary action. 73 No doubt every job that involves workers raising themselves to a substantial height above the ground and, if appropriate, removing limbs from trees, involves a degree of danger, but that danger is easily understood and easily able to be avoided if proper equipment is used and sensible precautions are taken. The process of inspecting and maintaining trees would not properly be called inherently dangerous, as that term might have been used concerning the electrical apparatus in Northern Sandblasting Pty Limited v Harris (1997) 188 CLR 313 or the use of fire in the presence of inflammable material as in Burnie Port Authority v General Jones Pty Limited. 74 It seems to me that the whole of the relationship between the Council and Prestige was one of a general principal which engaged a specialist contractor. It did so responsibly. It supervised the contract responsibly but in a practical sense there could be no oversight of the specialist work which Prestige was required to do. There was nothing inherently dangerous about the work. The essence of Mrs Choi's claim is the failure to identify the branch as dangerous, because it was likely to fall, and remove it. That was the very thing that the Council engaged Prestige to do. It seems to me that there is nothing about the relationship or the contract that leads to the conclusion that the Council ought to be fixed with the responsibility towards Mrs Choi of ensuring that Prestige did what it was required to under the contract in the manner in which it was required to do it. 75 In my opinion the Council's duty towards Mrs Choi was delegable and was delegated to Prestige. Mrs Choi's action against the Council fails. Mrs Choi's case against Prestige 76 Mrs Choi pleads her case against Prestige mainly by repeating parts of the Council's cross-claim against Prestige (including paragraphs asserting breach of contract, which were not pressed on the hearing). The particulars originally pleaded by Mrs Choi against the Council, and repeated by it in its cross-claim against Prestige, are these – (a) Failing to lay down an appropriate system for the inspection, care and maintenance of trees in Hyde Park in order to avoid risk of falling branches. (b) Failing to ensure that areas of Hyde Park where people were accustomed to lie was a safe environment and was not subject to overhand of hazardous branches. (c) Failing to properly inspect trees in the areas where people were accustomed to lie on the grass. (d) Failing to warn of the likelihood of branches falling. (e) Failing to remove a specific hazardous branch which fell upon the plaintiff. 77 In her Amended Statement of Claim Mrs Choi repeated these particulars taken from the Council's cross-claim against Prestige - (b) Failing to carry out maintenance of the trees in Hyde Park in a conscientious, diligent and professional manner which is higher than or equal to the degree of skill, care and diligence normally exercised by recognised professional persons which supply services of a similar nature. (c) Failing to carry out the maintenance of the trees in Hyde Park in a proper and workmanlike manner. (d) Failing to maintain the subject tree such that it was healthy and free of diseases, insects, deadwood and damage. (e) Failing to remove all dead and dangerous branches from the subject tree. 78 Finally, by paragraph 8 of the Amended Statement of Claim, Mrs Choi pleaded a proximity of Prestige to herself such that Prestige ought to have conducted itself towards her as asserted by the Council in its cross-claim. 79 A contractor may be held liable for the reasonably foreseeable consequences for strangers to the contract of careless or unskilful conduct in the performance of the contract: Voli v Inglewood Shire Council (1963) 110 CLR 74. That case was about an architect. Engineers have been so held liable: Eckersley v Binnie and Partners (1988) 18 Con LR 1. So have builders: King v Stewart (1994) 85 LGERA 384. There is no reason why the principle should not apply to a contractor like Prestige, which assumed responsibility for the management of trees. Neither is there any reason to distinguish between the careless commission of an act and the negligent failure to act. 80 Mr Nock SC did not dispute that a duty was owed by Prestige to persons in the position of Mrs Choi. In final written submissions Mr Nock said this - At a very general level, Prestige does not dispute that it owed a duty of care to the plaintiff. There is no dispute that Prestige had entered an agreement with SCC to maintain parks, open space areas and street trees and consequently, because the plaintiff was within a class of persons who used one of the parks in which Prestige was to perform maintenance works, it is not disputed that a duty of care of some description was owed. The more difficult issue is the nature and extent of any such duty of care. 81 By cl 3.3(c), Prestige was obliged to remove all dead, dangerous and fallen branches in accordance with the best practices of the arboricultural trade and dispose of them from the site. It may be accepted, as submitted by Mr Nock, that the subject tree was not affected by disease, insects, deadwood or damage. By cl 3.3(b) Prestige was to monitor the condition of all trees each month, though it did not have to report on any tree unless it was affected by disease, damage or insects: Addendum 4, Q and A 10. 82 The question that arises is whether the branch was dangerous as that word is used in the contract. It was submitted by Mr Nock that the word "dangerous" in cl 3.3 was ambiguous, that the Council had not attempted to define it, and that the Court should avoid a commercially inconvenient or nonsensical construction. Reference was made to Hide and Skin Trading Pty Limited v Oceanic Meat Traders Limited (1990) 20 NSWLR 310. Mr Nock submitted that pre-contractual and post-contractual conduct (the "factual matrix") should be taken into account in construing it. Reference was made to Codelfa Construction Pty Limited v State Rail Authority of New South Wales (1982) 149 CLR 337; Prenn v Simmonds [1971] 1 WLR 1383; DTR Nominees Pty Limited v Mona Homes Pty Limited (1978) 138 CLR 423. Pre-contractual conduct included Council's lack of interest in the offer of additional services suggested by Active Tree Services and recommended by Prestige and Council's keeping to itself knowledge from the several reports it had of the condition of the Hill's weeping figs. 83 There were these written submissions – …having regard to SCC's knowledge of the above matters, if it wanted a survey of the Hills Weeping Figs and then ongoing frequent and detailed inspections of them, in order to allow for the removal of dangerous branches, such a requirement should have been clearly stated in the contract. That is, given that well before it entered into the contract with Prestige, SCC had explicit actual knowledge of the Hills Weeping Figs in Hyde Park North posing a potential hazard to park users, including by reason of the presence of included bark in them, its failure to spell out the means by which "dangerous" branches were to be identified so as to lead to removal, as per clause 3.3(c), provides support for the construction contended by Prestige. … To construe clause 3.3(c) so as to require Prestige to perform frequent and detailed inspections of all the trees, without any additional payment, would make commercial nonsense of the contract. The fact of Active Trees suggesting an upfront fee of $9,000.00 for the additional services and Mr Dubiez suggesting a far greater cost, supports that contention. 84 In support of those submissions, Counsel pointed to evidence of correspondence from one of the unsuccessful tenderers, Ecoplex, which queried the meaning of the word "dangerous" and stated its own definition. 85 It would be wrong to suppose that the Council's keeping to itself the several reports it had on the condition of the Hill's weeping figs had left Prestige ignorant of the problem the Council was facing. For years, Prestige had contracted and sub-contracted in Hyde Park South where, according to the Arborcraft report, mature specimens of Hill's weeping figs had failed because of included bark. Mr McCallum knew Mr McLeod, one of the authors of the Arborcraft report, and had read the report. He must have been well aware of Mr McLeod's view, expressed in the report, that trenching, root rot and the tendency of Hill's weeping figs to include bark, would "have an impact on Hyde Park North over the next twenty years. It is possible that the avenue effect will be lost in some areas". Any reader of the report would realise that in it experts were predicting needs as great as the removal of entire trees to avoid danger to users of Hyde Park North. 86 Before the hearing began, Mr McCallum made a statement. It became exhibit 2.5. In the first paragraph of the statement he said - I am a qualified arborist with twenty-five years experience in general landscape maintenance, including tree surgery. 87 Mr McCallum was asked about Prestige's letter to the Council based on Active Tree Services' letter, offering additional services. There were these questions and answers - Q. Under that heading, "Additional services to be offered" we read: "Following an inspection of the parks and streets there are a number of mature trees that pose a risk to the public as they have a habit of dropping large branches". There is no question but that that was common knowledge as far as you were concerned? A. That's correct. Q. It is pretty trite, I know, but the habit of dropping large branches would be a matter of concern having regard to the fact that Hyde Park is a heavily pedestrian trafficked area? A. I think you will find that all trees drop branches. 88 There were these questions and answers about the assertion in Prestige's letter of the need for crown reduction - Q. And that would require, of course, aerial inspection, wouldn't it? A. Not necessarily. Q. Well, if you are going to have a look at crown reduction you would want to know what you are going to reduce, would you not? A. That's correct. Q. And in order to know what you are going to reduce you would want to be able to look at it, at sufficient proximity to know whether it needed reducing, correct? A. In my experience it has been done from the ground. Q. And that would include matters such as bark inclusion defects? A. I'm not qualified to answer that. 89 At that point Mr McCallum began to back away from any claim to be well experienced. There were these questions and answers - Q. You are a qualified arborist? A. I did a six week course run by the Forestry Commission. Q. Your witness statement commences "I am a qualified arborist". Did you stay your hand at all before putting your signature, if you did indeed, to that statement on the grounds that you had only done a six week course? A. At that stage that was the only course available to do horticulture. Q. Did you have, sir, any reservation as to the possibility that that statement might have been misleading in 2006 to any reader of the statement? A. No. Q. In the tender which is to be found exhibit 1.3 at page 22, you are shown, are you not, as the head of the Prestige McCallum staff organisation chart, right at the top of the structure as general manager, Craig McCallum, arborist. Is that right? A. I haven't seen that document for years. Q. May we-- A. Yes. Q. You have not seen the document for years, is that it? A. That's correct. Q. For better convenience I will ask you just to look at this copy of 22 from that exhibit, your Honour (Exhibit 1.3 shown). Does that refresh your memory? A. Yes. Q. Did you have any reservation about putting yourself at the top of that organisation which I think you also represented had a hundred million dollars worth of contract under management at the time, as an arborist, without qualification? A. It was the Prestige Group that a hundred million dollars worth of contract, not Prestige McCallum. It was a division of that group. Q. Let's not quibble about that. Did you have any reservation about that document going forth with you described as an arborist with no mention or qualification of the fact that it referred to a mere six week course you had done however many years ago? A. That was, I don't have any reservation, no. Q. When in paragraph 14 of your statement you are recorded as saying: "Apart from reporting obvious broken tree branches Prestige staff did not carry out inspections of trees at any level other than visual observation of trees at ground level and Prestige did not employ arborists for this purpose." Were you then using the term "arborists" as describing people with only that qualification that you enjoyed at the time that chart, page 22, went forward to the council? A. No, I wasn't part of the daily staff at Hyde Park. Q. You were talking to, you are addressing persons, in the phrase "Prestige did not employ arborists" who had full arboricultural qualifications well in excess of a six week course, were you not? A. I don't understand the question. Q. When you said "Prestige did not employ arborists" in your witness statement, you were referring to people with qualifications well in excess of a six week course however many years ago, weren't you? A. That course isn't available now. Q. Please answer the question, Mr McCallum. You were referring to people with much higher qualifications than that bespoken by a six week course, weren't you? A. Yes, yes. 90 Later there was this evidence - Q. If, for example, the council was looking to its contractor to assess all the trees in Hyde Park north and identify any potentially dangerous branches then they would need to have a proper inventory done and that is the sort of thing that we could offer as an additional service which you set forth in the tender, is that a fair summary -- A. Yes. Q. - of how it was looked at? And did you, as the mind as it were, of Prestige McCallum, put that forward with a separate, I'm sorry, not with a defined quote but with the advice that it would cost extra? A. That's correct. Q. And so it was that from the point of view of Prestige McCallum when the council did not take up the offer, as it were, did you determine that that sort of survey and monitoring process would not be part of the services that you would provide? A. Yes. Q. And that what you did would be restricted to a ground level survey of the condition of trees in Hyde Park north, for example, up to I think you may have said three metres? A. The staff that were, that I had in the park, yes. However there were other additional tree services that were carried out by Active Tree Services. Q. Did you require, that is you qua the head of Prestige McCallum, did you require of Active in terms that they should carry out an inventory of all the trees in Hyde Park north or not? A. No. Q. And did you require of them that they should undertake any aerial inspection of the trees in Hyde Park north? A. That is a mixed question. Obviously when aerial work was being carried out and deadwood had been recognised, they would carry out further inspection. Q. But did you require of them that they, Active Tree Services, should carry out aerial, that is from platforms or climbing operations, inspections of the canopy areas of the trees or not? A. When Active were involved in deadwooding trees, yes. 91 In my view it must have been quite plain from all that Mr McCallum knew and from his correspondence with the Council that Hyde Park North contained trees that experts considered potentially dangerous and had advised the Council were potentially dangerous. Anybody who walked along the avenue would have seen the peculiar growth pattern of the Hill's weeping figs. I reject Mr McCallum's claim to be ignorant of included bark. He had at least read about it in the Arborcraft report. The Council had included in cl 3.3 (c) a requirement for the removal of dangerous branches. It must have been obvious to Mr McCallum that branches so described might well be found in figs in the avenue. Mr McCallum might not have troubled to enquire deeply into the matter in the first place because he intended to sub-let the arboricultural work to Active Tree Services, but he must have realised from Active Tree Services' response that the Council required more than Active Tree Services was prepared to undertake. So much appears from his answers in cross-examination. 92 There was evidence that any tree can at some level be described as dangerous, evidence of a phenomenon called Summer Branch Drop, in which branches fall without warning from a condition or cause that cannot be explained, detected or forecast. So in a sense the only way to remove dangerous branches is to chop down all the trees. However, I would not regard a branch susceptible to Summer Branch Drop as dangerous as that word is used in the contract. Essentially, the contract required inspection, decision and action if appropriate. If nothing could be detected on inspection, nothing would be expected to be done. It seems to me that as the term is used in the contract, a branch would not be considered dangerous which could not be ascertained on reasonable inspection as dangerous. On the other hand, a branch that was identifiable on inspection as likely to fall, with the consequent risk of injury to somebody, was dangerous. 93 To my mind there was nothing about the commercial relationship between Prestige and the Council or about the surrounding circumstances to lead to any other construction. The Council was not obliged to disclose to Prestige, whose Managing Director called himself an arborist of long experience in tree surgery, and which sub-contracted arborists to do the work it contracted for, the details of the reports it had received about dangerous trees. Council's withholding those reports and requiring tenderers to agree to rely on their own enquiries does not persuade me that the intention was to deal with branches that were dangerous other than for reasons adverted to in those reports. 94 Mr McCallum was aware that Active Tree Services considered the work specified to be "very broad or all-encompassing" and was not prepared to undertake to remove dangerous branches. Consistently with that attitude, Mr McCallum wrote to the Council offering the "additional services" at a cost. I have extracted Mr McCallum's evidence. It seems clear to me that he understood at that stage that an undertaking to remove dangerous branches was going to require a systematic inspection of all the trees in the park. The Addenda issued by the Council showed that that was precisely what the Council expected the successful tenderer to do. Moreover, the Council made it clear that it had no inventory of trees. Clearly if Prestige was going to be successful, and if an inventory was essential, it was going to have to provide its own. 95 The evidence does not permit me so to conclude with any certainty, but it seems possible that Prestige's letter, based on Active Tree Services', omitting reference to the removal to dangerous branches and offering additional services, prompted the Council to write the letter sent by facsimile transmission on 27 April 1998. 96 In my opinion no inference favourable to Prestige may be drawn from the Council's lack of interest in the offer of additional services. Whether or not those services were accepted by the Council, the obligations under the contract stood. If confirmation were needed of that, the Council's facsimile letter of 27 April 1998 would provide it. It was after those events that Prestige, having changed its position from an offer which did not include the removal of dangerous branches to one that did, entered into the contract. Really, all the offer of additional services did was propose a particular computer-based system. That was simply a way of doing what proper performance of the contract would require in any event, principally an inspection of all trees at least once a month and an identification of those that were dangerous, followed by the removal of branches as appropriate. 97 Then Mr Nock submitted that Prestige performed its obligations under the contract in any event. Its contract supervisor, Mr Gersbach, was present and had between twenty-five and thirty staff under his control. Those members of staff monitored and reported on the condition of trees in a general sense and more particularly ensured that there was nothing overtly dangerous or unusual about them that might require attention. There was a system of passing on information about trees that had been damaged by storms, split or had visibly broken branches, and the like. 98 Prestige received reports from Active Tree Services stating the work it had done. Descriptive terms used in those reports included "poorly formed branches", "poorly formed branches…that could pose a potential hazard", "unsound limbs" and "unsafe branches". 99 Mr McCallum said that he saw staff from Active Tree Services removing dangerous branches, including some that were not dead. 100 It cannot be doubted that Prestige did work under the contract and that Active Tree Services did work under its sub-contract, but the evidence about the work so done goes no way to answering Mrs Choi's claim. I was impressed by the evidence of Mr Willcocks, the Executive Chairman of Active Tree Services. He confirmed that he saw no part of the contract or Specification other than the two pages setting out cl 3.3 of the Specification. He responded by writing the letter I have extracted and not long afterwards Mr McCallum telephoned him and told him that the Council was not interested in the additional services offered. Mr Willcocks took that to mean that the services offered in that letter were not required. No further request was received and Active Tree Services did not purport to provide those services. Referring to cl 3.3(b) of the Specification, Mr Willcocks confirmed that Active Tree Services never offered to monitor, record and report the condition of trees as therein required. 101 In about July 1998 Active Tree Services began sending teams of staff to Sydney to work on trees in streets and parks, by keeping them clear from buildings and wires and lighting and by removing damaged and dead wood over twenty millimetres in diameter. From time to time Prestige requested Active Tree Services to do work additional to their contract. On such occasions the requests were usually in writing. When that work was done it was separately invoiced and paid for. 102 It is indisputable from the evidence that nobody ever ascended to the necessary height and inspected the trees on the western side of the avenue, including the tree whose branch injured Mrs Choi, so as to ascertain whether dangerous branches were present. 103 Prestige's failure to inspect the tree, identify the dangerous branch and deal with the danger constituted a breach of the duty of care it owed to visitors to the park. 104 The evidence of Mr Ford was that it was highly probable that if those responsible had taken steps to inspect the subject tree appropriately closely the presence of included bark would have been detected. Mr Atkins thought that it would probably have been detected. I am satisfied on this evidence and independently by inference that such an inspection would have revealed the presence of included bark. Those responsible would have removed the danger by removing the branch, or, perhaps, by shortening it so as to make its weight bearable at the fork. 105 Mrs Choi has made good her claim against Prestige. Prestige's cross-claims 106 Prestige seeks indemnity or contribution from Active Tree Services and the Council. In its claim against Active Tree Services it pleads a sub-contract in which Active Tree Services agreed to undertake Prestige's obligation under cl 3.3 of the Specification, including the obligation under 3.3 (c) to "remove all dead, dangerous and fallen branches in accordance with the best practices of the arboricultural trade and dispose of the same from site". The particulars pleaded as to the written part of the sub-contract are Active Tree Services' letter dated 16 January 1997. Prestige says that pursuant to that sub-contract, Active Tree Services undertook inspection, by annual pruning, deadwooding and maintenance of trees but that it did not remove, attempt to remove, direct or report that the branch be removed. Active Tree Services owed Prestige a duty of care to ensure that dangerous branches were identified and removed. It failed to remove the dangerous branch, so it was in breach of the sub-contract and of its duty of care to Prestige and the plaintiff. 107 Beyond saying that there was a sub-contract by which Active Tree Services undertook to perform work Prestige was contracted to the Council to perform, there is no substance in these assertions. There is no evidence to support the claim that Active Tree Services undertook to remove dangerous branches. There is no evidence to support any assertion that Active Tree Services carried out any of the work it did in purported performance of any obligation to identify and remove dangerous branches. Active Tree Services' obligations to Prestige were as set forth in the letter dated 16 January 1997. Active Tree Services was not in breach of any term of its contract with Prestige or of any obligation it otherwise owed Prestige. It was not in breach of any duty of care owed to any user of Hyde Park. 108 Counsel for Prestige again resorted to the idea of a "factual matrix", pointing to a multiplicity of worksheets recording what Active Tree Services had done as though they were capable of implying an agreement to do the work Prestige had undertaken by cl 3.3(c). There was this submission - The fact that whilst Mr Willcocks told Mr McCallum that the Specification was "very broad" and that Active Trees "can't do all of it", he did not either orally or in the letter of 16 January 1997 ever state in terms that Active Trees was not prepared to perform the requirements of clause 3.3(c). Indeed, whilst the letter of 16 January 1997 made specific reference to clause 3.3(f) it made no specific reference to clause 3.3(c) at all. The lack of any such reference is curious, in the light of Mr Willcocks' evidence that he was "nervous" about what was being asked for in the tender document… 109 With respect, any paucity of evidence that Active Tree Services did not agree to perform the work required by cl 3.3(c) cannot logically become evidence that it did. 110 I will not set out the detail of the work recorded as having been done by Active Tree Services. It is sufficient to say that it is accounted for by Active Tree Services' letter of January 1998 and by the evidence of casual engagements to do extra-contractual jobs, as to which I accept the evidence of Mr Willcocks and Mr Dubiez. 111 The real difficulty Prestige faces is that there is no evidence that Active Tree Services ever undertook a program of examining the avenue of figs to ascertain whether dangerous branches were present and deciding what to do about them. Mr McCallum gave evidence. If any such thing had happened he would have said so. 112 In my opinion the terms of the sub-contract between Active Tree Services and Prestige are clear. Active Tree Services agreed to do the work set out in its letter. There is no need to look outside its terms. 113 The cross-claim against Active Tree Services fails. 114 In its cross-claim against the Council Prestige makes two broad assertions. The first repeats the particulars of negligence pleaded by Mrs Choi against Prestige. The second particularises in various ways what are said to be breaches of duty based upon the Council's failure to accept the offer of "additional services". 115 Both arms of the cross-claim must fail. First, as I have said, the Council discharged its duty to users of Hyde Park, including Mrs Choi, by making provision by the contract for the identification and removal of dangerous branches like the one which fell and injured Mrs Choi. The cross-claim asserts a failure to do the very thing that Prestige was obliged to do but failed to do. Secondly, for the reasons which I have explained, the Council was under no obligation to interest itself in the offer of "additional services" first suggested by Active Tree Services and repeated by Prestige. I will not repeat the reasons. The cross-claim against the Council fails. Active Tree Services' cross-claim 116 By its Amended Third Cross-Claim Active Tree Services sought indemnity from the third cross-defendant, P Matson on behalf of the Underwriting Members of Syndicate 990. In the circumstances the third cross-defendant is entitled to a verdict and the third cross-claim will be dismissed. Damages 117 Mrs Choi was born in Korea on 24 August 1978. She decided when young that she would try to become a professor in the English language. There is no evidence that English was spoken in her home. Between the ages of twelve and fourteen years she studied English at a junior high school in Seoul. In 1994 her parents arranged for her to complete her schooling in Australia and she obtained a student visa. Her intention was to study music, I suppose principally as a performer of piano, which she played well. She came to Sydney and lived with her brother and grandmother. She was accepted as a student at Tyndale Christian High School, Blacktown, where she completed part of year ten and the first part of year eleven. Although she did well in Japanese and satisfactorily in music and science, she was graded as "elementary" in the English language. She was dissatisfied and moved to a high school at Bondi. No records from that school have been put before the Court. She was unhappy at that school and moved to a third high school, where she completed her Higher School Certificate, including two-unit English. The only subject report from that school records her progress in Korean language studies, in which she scored 85/100 and was ranked 7/21 in the two unit course and 41/50 and 12/21 in the three unit course. 118 Unfortunately, she failed to gain entry to the New South Wales Conservatorium of Music, so she applied to the University of Sydney to enter a Bachelor of Arts course specialising in Japanese language studies. She had some familiarity with the Japanese language. She was accepted and began studies in 1998. She lived in a flat at Parramatta with her brother. Her parents supported her financially. By the terms of her student visa she could work for a wage for up to twenty hours per week and she took advantage of this by working for a period of three months at a duty free shop at Circular Quay. 119 If she had progressed at normal pace Mrs Choi would have completed her studies towards the Bachelor of Arts degree by December 2000. For the most part she chose subjects with which she had some familiarity. However, she had difficulty. In 1998 she scored bare passes in Beginning Chinese (1) and Beginning Chinese (2) and Japanese Introductory Level 3. She discontinued Junior Introductory German 1 and Japanese Intermediate Level 3. She failed Sociology 101, Introduction to Chinese Civilisation, Modern Asian History and Culture 1 and Japanese Introductory Level 4. 120 In 1999 she passed Gender and Popular Culture, Thinking Gender, Second Year Chinese (1), Beginning Classical Chinese, Japanese Introductory Level 4 and Korean Introductory Level 6. She gained a credit in Korean Introductory Level 5. She failed Music in Society 1 by discontinuation. She failed Concepts of Music Language 1B, Second Year Chinese (2) and Readings in Classical Chinese. 121 In 2000 she passed Contemporary Japanese Fiction, Introduction to Korean Grammar and Contemporary Drama – J. She gained credits in Mass Media in Korea, Japanese Communication Intermediate 3, Japanese Communication Intermediate 4 and Intro: Japanese Society and Culture – J. She failed Japan and World War II, Bodies Sexualities, Identities and Modern Korea. 122 To the end of 2000 Mrs Choi's pattern of results suggests a number of things. First, the longer she studied the better she was applying herself (she herself conceded in evidence that she had taken on too many subjects in first year). Secondly, she preferred the subjects with which she was familiar, those concerning the languages and societies of the part of Asia from which she hailed. Thirdly, she was not fortunate enough to have the kind of flare for languages that would be expected of a university professor or an interpreter, or, perhaps, even a teacher of English as a Second Language. Finally, although Mrs Choi's claim is that she was keen to make a career in the use of the English language, and although instruction in the classes she attended was in the English language, she never undertook any formal university study in that language. Neither does it appear that she undertook any formal external courses or took any other step to familiarise herself with the English language or to become fluent in spoken or written English. 123 After she was struck by the tree branch Mrs Choi was taken to the Emergency Department at St Vincent's Hospital. Her Glasgow coma score was 8 at the scene and 10 at hospital. By 23 December is was 12, indicating that post-traumatic amnesia had existed for nine days. Post-traumatic amnesia testing commenced on 2 January, when full scores indicated that she had emerged from that condition. Later reports stated that she had emerged from post-traumatic amnesia "by 2 January", a day twenty days after the accident. There was a six-centimetre laceration of the left fronto-temporal region of the skull. There was an extracerebral collection and ventricular compression. A craniotomy revealed a linear fracture of the temporal bone and extradural and subdural collections. They were evacuated. The brain was swollen and reddened. The bone flap which was removed for the purpose was stored. 124 Mrs Choi was transferred on 11 January 2001 to the Royal Rehabilitation Centre at Ryde where she began a comprehensive rehabilitation program. On admission she was suffering diplopia consequent upon traumatic nerve palsy, though that resolved itself during her stay. She was suffering from acute stress reaction, being particularly anxious that fans or lights might fall from the ceiling. She revealed a premorbid history of anxiety about instances like proximity to animals, noisy trucks rushing past, crossing roads, getting on and off trains and working in a garden. She was noted to have higher language difficulties in Korean and English, particularly in auditory memory of passages and word finding. 125 She discharged herself from the centre on 24 January, and a home-based rehabilitation team was to attend to her. However, her fear and anxiety continued and she was readmitted to the Royal Rehabilitation Centre on 5 February 2001. An intensive therapy program began on 7 February, targeting high-level language and linguistic deficits. A homework program was provided for completion in English and Korean. Mrs Choi demonstrated improved ability in English word-finding tasks at conversational level and the therapists noted a resulting improvement in fluency. However, some word finding difficulties within inferential tasks remained apparent. 126 Mrs Choi was transferred to St Vincent's Private Hospital for further surgery on 1 March 2001. Upon her departure from the Royal Rehabilitation Centre the opinion of her speech pathologists was that her higher-level language skills and complex problem solving capacity had shown a presumed decline relative to premorbid levels. However, gradual recovery in basic cognitive functioning, in conjunction with ongoing therapy and home practice, had resulted in improved performance. It was expected that she would continue to improve with time and continued practice and generalisation of language tasks at home. It was strongly recommended that she delay any return to study so as to have more time to recover. The therapists noted that Mrs Choi was highly motivated and would continue to improve her linguistic ability, "based on the communicative demands of her natural settings". 127 On 6 March 2001 Mrs Choi underwent cranioplasty with insertion of a titanium prosthesis over the skull defect. She was discharged from hospital on 17 March 2001. 128 Mrs Choi had been complaining about pain in the right shoulder, but by June 2001 the pain had improved. An ultrasound showed that there was no rotator cuff tear. 129 Those reporting on Mrs Choi have noted that there was pressure upon her to complete her degree, and notwithstanding the professional advice she was being offered, she desired to take up her studies again as soon as possible. On 6 June 2001 she wrote to the University asking for permission to recommence. She spent the month of July in Korea and from there wrote a further letter requesting special permission to exceed the maximum allowed credit points for the second semester of 2001. She said that that year was her last and that she was planning to graduate at the end of it so that she could go back to Korea. She said that she had got into financial difficulties and that she had been working in a part-time job for two years (in fact she had worked for only three months). In the letter she proposed a plan of subjects to be taken during the second semester of 2001 and in the succeeding summer school, successful completion of which would qualify her for her degree. The letter, exhibit 2.3, is written in clear and fluent English, notwithstanding minor spelling and grammatical errors. Upon resumption of her studies in 2001 Mrs Choi recorded passes in Modern Korea, Japanese Communication Intermediate 6, Introduction to Japanese Society, Korean Intermediate Level 6 and Histories, Narratives and Images. She did not fail any subject. 130 Mrs Choi's results for 2002, which I think must have been achieved at the summer school about which she wrote in her letter, recorded a pass in Introduction to Korean Phonology and a failure in History of the United States Since 1865. 131 As before, communication in class was given in the English language. The notable features of the subjects and results are that Mrs Choi took no subject in the English language, that she failed to gain a credit, notwithstanding the increasingly impressive results in that regard before her injury, that she had no failure at all in 2001 and that she failed one subject out of two in 2002. 132 In June 2002 Mrs Choi graduated Bachelor of Arts and in July returned to Seoul and moved into her parents' home. In September she obtained employment as a clerk with a company called DAS. Her employer terminated her employment in July 2003. In August or September of 2003 Mrs Choi obtained employment with a company called Korex and that employment was terminated in December 2003. On 11 September 2004 Mrs Choi married and moved into her and her husband's home. At some unascertainable time she unsuccessfully applied for employment as a teacher in the Japanese language. 133 In March 2005 the titanium plate broke through the scalp. Mrs Choi returned to Australia for review by her surgeon, Dr Pell. On 17 March Dr Pell placed a skin flap over the titanium prosthesis. The revision was successful. Dr Pell reviewed Mrs Choi again in April and November 2005. His present opinion is that no further surgery will be needed. 134 On 24 March 2003 an MRI revealed a 3x2x2 centimetre area of CSF signal in the left temporal lobe, showing either a trophic change or resection of portion of the temporal lobe. There were signal changes in the frontal and remaining left temporal lobes and in the right temporal lobe anteriorly. The changes were consistent with previous head injury. 135 For the purposes of her case, Mrs Choi was seen by six specialists, namely Mr Taylor, clinical forensic psychologist, Dr Fitzsimons, neurologist and Dr Buckley, physician in rehabilitation medicine, all at the request of her solicitor, and Dr Roberts, psychological consultant, Dr Fearnside, neurological surgeon and Dr Bowers, rehabilitation physician, all at the request of the solicitor for Prestige. All wrote reports which came into evidence. Counsel for Prestige did not wish to cross-examine the experts qualified by Mrs Choi's solicitor. Those relied on by Prestige were cross-examined. 136 Dr Roberts first saw Mrs Choi in February 2002 and wrote a report on 27 July 2002. She had available to her records of the treating specialists and institutions. She interviewed Mrs Choi twice, first with her uncle and then with her mother. All interviewing and testing were done through an interpreter in the Korean language. Dr Roberts thereby obtained a detailed history of Mrs Choi's upbringing and education in Korea and more latterly in Sydney, her progress during treatment and rehabilitation and the complaints she was then making, particularly of difficulty in remembering things, headaches, a painful shoulder, numbness in the left arm and a change in personality, having become sensitive and easily angered and having developed a dislike for some foods that she previously enjoyed. 137 Dr Roberts administered a range of standard psychological tests including, notably, those designed to test verbal skills in English. Dr Roberts said in her report - 6.2 Communication : She spoke clearly and fluently in Korean, with the interpreter (who attended on the second occasion) indicating that there were no hesitations or problems. She showed some language problems in English. The assessment took place in a mixture of English and Korean. 138 Having set out the test results, having reviewed the treatment records and having summarised the interviews, Dr Roberts said - 12.7 The results of this assessment indicate that at face value she is functioning in the mildly retarded to borderline range with memory skills so poor that if valid, she would be likely to be institutionalised, would not be living independently in the community and certainly would not be studying at university and managing to pass, albeit on a reduced load. The global depression of scores for me is not consistent with that reported by the neuropsychologist at Coorabel, nor is it in my opinion explained by emotional factors. That, combined with her assessed poor literacy in English, suggests that it is highly likely that she is exaggerating for the purposes of financial gain. I note that she performed in the borderline range on a test of malingering. There were multiple other indicia of malingering (which include deficits which were out of proportion with the severity of the injury and are inconsistent with what I was told about her ability to function independently in the community and attend university) and there were also signs consistent with exaggeration in the manner in which she filled out a screening test for emotional disturbance. 139 Mr Taylor first saw Mrs Choi on 19 March 2003. Mrs Choi's solicitor provided for him copies of treatment records but not of Dr Roberts' report. I assume that it had not then been served. Mrs Choi spoke almost exclusively through an interpreter, and for that reason Mr Taylor considered it inappropriate to test her verbal skills in English. For the same reason, the full scale IQ could not be obtained. Mr Taylor thought that Mrs Choi appeared to be making a genuine attempt to perform the tests. The performance scale IQ results suggested an overall reasoning ability in the low-average range. Speed of processing information was average. Working memory abilities and memory functioning could not be fully tested, though on the limited results available the memory index score might have corresponded with the performance scale IQ. The memory function test results indicated significant impairment in memory. There was a marked difficulty of maintaining attention over successive tests. As to abstract reasoning, there were a number of perseverative errors commonly found in traumatically brain-injured subjects. Mr Taylor thought Mrs Choi was significantly impaired. As to emotional functioning, he thought her nervous, afraid, finding it difficult to relax, with some somatic symptoms. He considered Mrs Choi moderately depressed. 140 Mr Taylor is a highly experienced psychologist and I think that weight should be given to his assessment of Mrs Choi as genuinely trying to complete the tests for him. I note again that counsel for Prestige did not wish to cross-examine Mr Taylor. In my opinion the results, limited as they are, should be accepted, as should Mr Taylor's overall assessment. 141 For the reasons given by Mr Taylor I would discard Dr Roberts' results of Mrs Choi's English verbal skills tests together with her opinions, so far as they were based upon them. I prefer the conservative approach. I do not understand how Dr Roberts was able to conclude that Mrs Choi was fluent in Korean or how she could assess the accuracy of the interpreter's work. Dr Roberts did not claim to be fluent in Korean. I listened carefully to Mrs Choi as she gave evidence through an interpreter, but found myself unable to say whether she was fluent in Korean, a language of which I have no knowledge. 142 However, that does not mean that all Dr Roberts' results and opinions should be disregarded. There was a substantial number of tests that both she and Mr Taylor performed, and the results differ markedly. I will reproduce the main ones, Mr Taylor's first and then Dr Roberts' - Performance IQ 83 73 Perceptual organisation index 84 69 Processing speed index 99 81 Visual immediate memory 68 45 Visual delayed memory 65 47 143 The last two cited test figures of Dr Roberts would place Mrs Choi at "< 0.1 percentile", which I take to mean in the lowest one-thousandth of the population. I accept that Mrs Choi was not making a genuine attempt to complete the tests for Dr Roberts. Standing alone, however, Mr Taylor's opinions and the results on which they are based, all grounded on the undoubted changes in the left frontal and temporal lobes and the right temporal lobe, seem reasonable and acceptable. Although Mrs Choi's lack of candour towards Dr Roberts has implications for other parts of her case, it does not lead me to place any less reliance on Mr Taylor's assessment. 144 Dr Roberts saw Mrs Choi again on 19 February 2004 and wrote a report on 16 May 2004. She also interviewed Mrs Choi's mother again. All was done through an interpreter. Dr Roberts had historical documents including Mr Taylor's report of 14 April 2003, which set out his results and opinions summarised above. Dr Roberts tested Mrs Choi again. Again she used the interpreter to test English verbal skills as well as in the performance of the other tests. The report contains this paragraph - An official interpreter was present throughout and as a result, the testing was non-standardised, of necessity. It is recognised that the presence of a third person during cognitive assessment can affect test results but it was unavoidable in this situation. 145 I will not extract the results. Two scores were the same as in 2002 and three substantially lower. Dr Roberts thought that Mrs Choi was malingering. 146 Dr Roberts saw Mrs Choi again on 23 August 2005. Again an interpreter was used. The report of 31 March 2006 contains these paragraphs - Please note that the results included in this section are for interpretation by registered psychologists only. Also, the administration of the cognitive test was not standardised because of the need for the presence of a third person. … Please note: I did not administer Vocabulary or Letter Number sequencing for cultural and linguistic reasons. 147 The test results were as good as or better than on 19 February 2004. In particular, the visual immediate and visual delayed memory results had risen to 57 and 53 respectively. 148 Dr Roberts drew attention to Mrs Choi's reports of infections, and her belief in the possibility of further surgery, which she thought could not be done in Korea. Mrs Choi said that she felt stressed and did not feel like eating. She had weakness on her left side and pain over the left side of the head, particularly the area of the operation, and was not able to wash her hair herself. She could not sleep on her left side and was worried when in the street in case she was hit with a ball when children were playing. She had difficulties with her knees, food allergies and difficulty eating and sleeping. She referred to aching shoulders and intermittent blockages of the right ear. She set out the test results. Dr Roberts continued - The results of this assessment, at face value, indicate that Mrs Choi is functioning in the retarded range with memory skills below that, but there is clear evidence that she was under performing on this occasion, as previously. I also do not have an accurate assessment of her emotional functioning because it is highly likely that she was exaggerating on that as well. 149 Dr Roberts wrote that it would not be unexpected for Mrs Choi to have some cognitive and emotional problems, but concluded that despite the severity of the head injuries there was evidence of conscious exaggeration which precluded accurate assessment of any genuine cognitive or emotional problems. 150 Mr Taylor saw Mrs Choi again on 11 September 2006 and wrote a report on 25 September 2006. Again an interpreter was used. Mr Taylor had all the medical reports and the three reports of Dr Roberts. Again he tested Mrs Choi. Again he eschewed resort to the testing of verbal skills through the interpreter. Mrs Choi's results were for the most part comparable with the results of Mr Taylor's first test. Those for visual immediate and visual delayed memory were respectively 81 (up from 68) and 65 (unchanged). 151 I should add that none of the test results achieved with Mr Taylor would place Mrs Choi in the retarded or borderline retarded range, something that troubled Dr Roberts. 152 In his first report, Mr Taylor had said this - The Royal Rehabilitation Centre Sydney states that she had a post traumatic amnesia duration of 20 days which is reasonably consistent with periods stated by Miss Choi during the history taking from her. A report by Ms M Kochan and Ms C Taylor (which is undated) reports on the assessment they made of Miss Choi. She was assessed between 15th and 24th January 2001. The medical diagnosis provided to Ms Kochan and Ms Taylor was that of traumatic brain injury. It was stated in this report that she demonstrated a weakness in higher executive functions but that her basic concept formation was intact. This does seem reasonably consistent with her performance on the Short Category Test on the present occasion when she did experience significant difficulties. It was also felt that her level of insight concerning her difficulties and the implications for future studies was very limited. Quite clearly then, Miss Choi has been significantly injured in the accident and that she has suffered from permanent organic brain damage. As the injury occurred more than 2 years prior to the present assessment, it could not be anticipated that she will show any significant improvement in the future and that the extent of her present condition will be with her on a permanent basis. It is quite clear that she could not have functioned at her present level prior to her accident and that there has been a generalised deterioration in her cognitive skills. She is also suffering from symptoms of moderately severe depression and anxiety. I feel that she has an adjustment disorder with anxiety and depression as a consequence of her injuries. This is due to not only the effect that the injuries have had on her life but also the pain and discomfort she is currently experiencing due to her injuries. She provided no history of pre-existing emotional difficulties. 153 In his second report Mr Taylor said this - Her present results do not deviate significantly from those obtained in the previous assessment in 2003. There are indications that because of her severe head injury she has experienced a significant decline in her cognitive abilities. She continues to experience difficulty in areas of memory functioning and in auditory concentration. In the previous report it was stated that she would not be able to undertake a teaching role and that she would only be able to cope with relatively semiskilled forms of employment because of her cognitive impairments. She reported that since returning to Korea she has attempted to work as a receptionist and in the area of general office duties but was unable to cope with this due to fatigue, and difficulties in meeting people. Since the time of the previous assessment for depression has become severe. She has consulted with a psychiatrist in Korea in 2005 because of her emotional difficulties but discontinued after about 10 sessions as she did not feel that she could disclose personal details and experienced feelings of shame. It is however clear that she is in need of ongoing psychiatric treatment for her depression. She states that her depression is associated with not being able to work and because of the decline in her quality of life. By this stage Ms Choi's emotional difficulties have become somewhat chronic and she cannot expect an early resolution to these problems. In fact, I view her prognosis for recovery as guarded and it is unlikely that she will experience any improvement without appropriate treatment. She feels that her marriage is being affected by her emotional difficulties particularly because of her irritability and frequent mood changes. Her areas of cognitive impairment must also be considered as being permanent as there is no longer any real likelihood of future improvement. It is probable that her cognitive impairment is being contributed to by her symptoms of depression to some extent. 154 Dr Fitzsimons first saw Mrs Choi in March 2003. Mrs Choi spoke English during their interview. Having reviewed the results from Dr Pell, the Royal Rehabilitation Centre and Dr Taylor's testing, Dr Fitzsimons said - Although MRI scanning changes in signal cannot be considered a measure of the severity of the injury at the site where the signal changes are seen, they do in Mrs Choi's case clearly indicate bilateral temporal lobe damage. Bilateral temporal lobe damage is a classic cause of severe memory deficits, and I therefore think that the memory deficits document can reasonably be attributed to the brain damage sustained in the accident. 155 Dr Fitzsimons pointed to the twenty-day period of post-traumatic amnesia as indicating the likelihood that she would have some permanent difficulties with short-term memory deficit. 156 Dr Fitzsimons went on to comment upon a possible cause of what was put to her as Mrs Choi's decreased capacity to speak and understand the English language, as opposed to any other language. 157 Dr Fitzsimons saw Mrs Choi again in September 2006. Her report is dated 26 September 2006. This time there was an interpreter, which Mrs Choi preferred to use, though she was to some extent able to communicate clearly in English. In her earlier report Dr Fitzsimons had said, erroneously I think, that Mrs Choi was left-handed. She confirmed in this report that she was right-handed. The only significance of this is that Dr Roberts had seized on Dr Fitzsimons' statement of left-handedness as throwing doubt on the extent of Mrs Choi's cognitive deficits, either because the area of the affected brain in a left-handed person gave no or limited support to Mrs Choi's claim to have been affected particularly in her capacity in the English language or because she had affected left-handedness in an attempt to deceive Dr Fitzsimons (I am not sure which). In my view the statement about left-handedness was a simple clerical error that says nothing about Mrs Choi's cognition or motivation. 158 Unfortunately, each of the professionals who dealt with Mrs Choi was dependent upon her accounts for the conclusion that her capacity in the English language had been singularly affected. For reasons which I shall explain, I am not satisfied that Mrs Choi's capacity to speak and understand English has been affected to any greater degree than her capacity in any other language. 159 Dr Fitzsimons referred to Dr Roberts' criticisms and continued - I think that, given her bitemporal pathology, it would be entirely reasonable to regard any evident consistent memory deficit as a likely organic consequence of her accident. That does not mean that there may not be an additional non-organic component. … The memory deficits which would be expected frequently to result in bilateral temporal lobe pathology would also mean relearning languages such as English and Japanese very difficult. It is difficult to know precisely what extent her language has been affected, but given that there is damage affecting the dominant parietal lobe [on the left], in an right handed individual, the reported difficulties which she has with English, which is not her native language, would be understandable. This would manifestly impact on her ability to teach English as a foreign language. 160 Dr Fitzsimons concluded by saying that whatever non-organic features might be contributing, it was likely that a memory deficit placed Mrs Choi within the upper-bracket of a "mild cognitive impairment", as that term is used in Table 2, Chapter 4, AMA 4. 161 Dr Fearnside interviewed Mrs Choi through an interpreter. As to others, Mrs Choi said that she was able to understand English but could not now use sentences at all in English. Before her injury she thought that she had a command of English. Dr Fearnside thought that the post injury recovery and cognitive function were not clear and noted that Dr Pell had said that on her discharge she was conversing in both Korean and English. He noted also that Dr Fitzsimons had been able to speak to her in English. He would not have expected such a deterioration in English language skills and found it difficult to believe that Mrs Choi had lost her command of English so profoundly. Accepting that Mrs Choi sustained a severe head injury with a subdual haematoma, he tended to agree with Dr Roberts that there may have been a tendency to exaggerate any ongoing disability. Dr Fearnside considered, however, that Mrs Choi probably had an impairment of cognitive functioning. However, he would have expected her to be able to work as a teacher, judging by the progress she made in the completion of her degree. He thought it inconsistent with the pattern of recovery from head injury that the claimed deterioration in language and function should occur at a later stage. 162 Dr Bowers, rehabilitation physician, saw Mrs Choi on behalf of Prestige. He thought that she had made a good recovery from what would initially have been graded as a severe traumatic brain injury. He noted that at the time of discharge from the Royal Rehabilitation Centre she was completely independent with all personal care activities of daily living. He considered her scores on the cognitive tests near normal, though there were some problems with expressive language function. He thought that there were some features not explicable on the basis of organic disease, for example Mrs Choi's ability to complete a university degree, apparently in English, when she was still unable to communicate with him in English for the purposes of his assessment. He considered Mrs Choi's expressed disabilities greater than he would have expected given the medical features of the case. He would have expected her to be able to perform all activities of daily living independently. He thought that she would have some difficulties with very complex cognitive and language tasks. Those problems were attributable to the accident. He considered her condition permanent. 163 Dr Buckley saw Mrs Choi on 21 March 2003. His report is dated 7 April 2003. An interpreter was used for the interview. Dr Buckley took a history. He had the medical records from St Vincent's Hospital and the Royal Rehabilitation Centre as well as Mr Taylor's assessment. This was his diagnosis - Ms Yun Hee Choi has a traumatic brain injury in the "very severe" range with consequent deficits of higher cognitive function and behavioural deficits. Her deficits of higher cognitive function include reduced capacity to speak and understand the Japanese language, reduced capacity to speak and understand the English language, and altered memory function. She has poor insight into her deficits and reduced reasoning capacity. She has altered capacity to maintain focus of attention for auditory material and her abstract reasoning and concept formation abilities are impaired. 164 Dr Buckley saw Mrs Choi again on 14 September 2006. Her mother and an interpreter attended. Dr Buckley reviewed Mrs Choi's progress since the consultation in 2003. Mrs Choi's main problem was mood swings, with pain or discomfort on the left skull and scalp and headaches. She had memory impairment. She indicated pain in the right shoulder. There were some word-finding difficulties. Sometimes the right ear blocked. Sometimes she felt nauseous after food. Some food was "dirty". She felt "itchy" in restaurants and preferred to use disposable utensils. These complaints had all been previously made to other interviewers. 165 Dr Buckley had Dr Roberts' reports of 2002 and 2004 and Mr Taylor's first report. He noted Dr Roberts' observation that the only precise indication of the length of post-traumatic amnesia was not less than nine days, judging from a Glasgow coma score reading recorded after nine days. (The first "clear" record, made after twenty days, meant no more than that post-traumatic amnesia could have ceased as few as nine days and as many as twenty days post-accident). Dr Buckley thought that the risks of significant deficits of higher cognitive function and behaviour were somewhat lower at nine days than at twenty, but nevertheless "very real". He continued - …Significant cognitive deficit would be commonly expected with post-traumatic amnesia of nine days. 166 I accept that opinion. Of course, Mrs Choi's post-traumatic amnesia may have subsisted for more than nine days. 167 Dr Buckley agreed with others that traumatic brain injury invariably improves over the first two years and thought the exaggeration identified by Dr Roberts odd in view of the evaluation of Mr Taylor, who did not identify any exaggeration. He thought that the deterioration that appeared to have taken place between the test results of Ms Kochan at the Royal Rehabilitation Centre and Mr Taylor's test results would be quite unusual in the presence of traumatic brain injury. 168 Dr Buckley referred to the MRI report of 24 March 2003 and considered that the length of post-traumatic amnesia and the results of Mr Taylor were compatible. 169 Mrs Choi gave evidence through an interpreter, speaking in what I took to be the Korean language. Her manner of answering showed that she understood the meaning of some of the things she was asked before the questions were translated. I was able to conclude that Mrs Choi had at least a rudimentary understanding of clearly spoken English, though I could not make any further finding on what I saw and heard. Counsel came to the subject of the resumption of studies in 2001 and there was this evidence - Q. Did you do better or worse in the subjects you undertook in that semester than you had done overall in the first year you went to university? A. I can't remember well but my friends and professors helped me a lot in second semester of 2001. Because I submit doctor's report of my accident to all the professors I undertook and my friends all knew about my accident, so all the people around me helped me a lot. 170 Mrs Choi was asked why she did not speak in English to the medical practitioners who interviewed her. When she was asked about Dr Fearnside there was this evidence - Q. ... Did you indicate to the doctor through your interpreter that you did not speak any English? A. Because I couldn't understand what doctor was saying and it's certain and accurate to speak through the interpreter, so I was worried if doctor asked me questions directly, so I said I couldn't speak English. 171 Later, there was this evidence - Q. Do you speak English now as well or better than you did immediately before the accident? A. Yes, my English is improved. 172 I do not take the last extracted answer as indicating any agreement that at the time the question was asked, October 2006, Mrs Choi's English was as good as it had been in December 2000, immediately before she was injured. It would be surprising if that were the case in view of the traumatic interruption which had occurred to her life, followed by her return to Korea in 2002 and her continuous residence there ever since speaking, as I would assume, Korean and not English during the whole of that time. The answer did, however, point out the difficulty that occurs in this case of knowing how to evaluate Mrs Choi's claim to have lost significant capacity to speak English. As I have said, if the loss exists, there is a possible organic explanation in the evidence of Dr Fitzsimons. But there is no objective test by which such a loss can be demonstrated, and, as I have observed, the practitioners have been obliged to deal with the claim at face value. 173 It is clear that Mrs Choi suffered an injury apt to produce a cognitive deficit, including impairment of memory and of the higher functions of language. So I accept that her ability to speak and understand Korean, let alone English, has been affected. In that respect there is no significant distinction to be made between Korean and English. Mrs Choi had been speaking and writing Korean longer and knew it better, but it and her capacity in English were and continue to be affected. Mrs Choi appears to have done better in Korean, but that is because she speaks and writes in the company of people who speak and write Korean. She has not progressed in English for two reasons. Her deficits make it harder for her and she has not tried. The evidence shows that during the second half of 2001 Mrs Choi attended university, where the language of communication was English, and substantially understood what was being said and, where appropriate, written. No doubt things were harder for her. No doubt she did receive the special help about which she spoke. One can understand how sympathetic friends would help, even cosset, her, and how those academics in charge of her would give her additional help. But it is not to be supposed that the University's standards were in any way relaxed so as to enable her to pass her subjects where passes were not warranted. Her capacity in English was affected, but she was not totally incapacitated. I conclude that it is probable that if Mrs Choi had continued to live in an environment in which it was necessary for her to speak and write English she could, notwithstanding her cognitive deficits, have applied herself and made some advancement. 174 I am satisfied that Mrs Choi suffered a serious head injury which has produced lasting results. She has a scar which embarrasses her. She has pain at the operation site. She is self-conscious about her appearance. Her high-level language skills (particularly as demonstrated by her difficulties with Korean) were affected. This was the opinion of the speech therapists, Ms Taylor and Ms Ryan - Higher level language skills and complex problem-solving capacity have shown a presumed decline relative to premorbid levels. However, gradual recovery in basic cognitive functioning, in conjunction with ongoing therapy and home practice, has resulted in improved performance for these linguistic deficits. It is anticipated that she will continue to improve with time, and continued practice and generalisation of language tasks in the home environment. 175 I note that those therapists recommended against any early return to study. 176 I am satisfied that Mrs Choi has suffered serious and permanent consequences which will materially affect her life. The higher functions of language are permanently affected. She has a permanent deficit in short-term memory, which affects language and other aspects of her life. Her behaviour has been permanently affected, noticeably in the angry moods that continually beset her. She suffers from fatigue, headaches and pain in the shoulders. Her sense of taste has been affected. Her skull and scalp are painful at the operation site. She is embarrassed about her appearance. She has difficulty sleeping on the left side of her head. She will have difficulties in her personal relationships. She suffers from a chronic depressive disorder. I note that she has always been a fearful person, with anxieties about animals, trains, roads and fast moving vehicles, and that that may in part explain her reluctance to speak English and try to regain whatever she can of her former abilities in the language. It may also go some way towards explaining why she exaggerates her symptoms, as I think she does. Nevertheless, she has suffered well-demonstrated organic injury and I am satisfied that significant and permanent deficits and effects are the result. 177 I assess her general damages at $250,000.00, which includes a component of interest on half the sum allowed for 6.25 years at 2 per cent. Past and future medical expenses 178 Past medical expenses are agreed in the sum of $73,259.95. 179 Mrs Choi's claim for past travel expenses in connection with her treatment is for $12,000.00. It has been necessary for her both to maintain her contacts with her treating specialists in Australia and to pursue her home life in Korea. I think that her travel was necessary and reasonable and I allow the sum claimed. 180 Dr Buckley thinks that Mrs Choi will need to consult a few times a year with a general practitioner and to have occasional consultations with a physician in rehabilitation management. I am satisfied that she will be able to obtain those medical services in Korea and that there will be no need for her to undertake the expenses of travel. I allow her $15,000.00, for future medical expenses. Economic loss 181 Mrs Choi's claim is for total and permanent wage loss. Since her return to Korea she has turned her attention to the Korean language and, it appears, to Japanese, though not to English. As I have said, I do not think that Mrs Choi is particularly gifted in languages and I doubt whether she would ever have acquired the facility in English that would have been necessary before she could teach it for a living. She achieved only modest results in High School and has not formally studied it since then. She might well have had a dream about teaching English but she never tried to give effect to it when she had the opportunity. 182 Since her return to Korea she has had two jobs, the first for a substantial period of time, but I accept that she has proved unsuitable, perhaps because of her anxieties and angers, and has been dismissed. No wage records have been produced from either employer. Mrs Choi has married and wishes to have a family. 183 I am satisfied that the effects of her injury have probably excluded her from highly paid work and left her suitable only for more menial tasks. I do not accept, bearing in mind that she has married and wishes to have a family, that she would, uninjured, have worked full-time until normal retirement age. The net wage rate for an English teacher would have been about $650 per week, but I doubt whether, uninjured, Mrs Choi would have secured an appointment as an English teacher. There is scant evidence of other wage rates in Korea; none, for example, for teachers of Japanese, which might have been appropriate. The fairest approach seems to be to select a lump sum which would produce about $300.00 per week between the present time – Mrs Choi is now twenty-eight years old - and Mrs Choi's sixtieth birthday. This amount includes an allowance for the vicissitudes. The multiplier for thirty-two years is 1079.8. A lump sum of $300,000.00 would produce almost $300.00 per week for the period I have named. I allow that lump sum. 184 As to past wage loss, the claim is for $650.00 per week, based on Korean wage rates for English language teachers. For the reasons I have explained, those rates are inapplicable. During her periods of employment Mrs Choi earned the equivalent of about $20,000.00 over ten months, the equivalent of $2,000.00 per month. I am prepared to assume that uninjured she would have earned at a greater rate than that. A teacher would earn approximately $650 per week net on current exchange rates. I propose to allow $400.00 per week for the four years 2003 to 2006 and to offset the sum of $20,000.00, which is approximately equivalent to the amounts Mrs Choi actually earned. That allowance is inclusive of interest. The total amount I allow is $65,000.00. 185 So I allow $365,000.00 for economic loss. Care 186 I accept that Mrs Choi had a need for care following her discharge from hospital and her stay in Korea immediately before returning and resuming her studies. That was a period for about four months. Mrs Choi's claim is for $25,196.00 for a three year period. The four months I have allowed is one-ninth of that period and I allow $2,800.00, which I round up to $3,000.00 for interest. 187 Mrs Choi makes a claim for the cost of care for the present and the future. I am not satisfied that that claim has been made good. As soon as she returned to resume her studies she lived in her own private accommodation and managed her own affairs. She had, apparently, no need of special assistance from anyone. There is no reason to suppose that the position has changed. I note that care has been provided for her in Korea, but the evidence about it is quite unsatisfactory. It seems possible that her mother and stepfather are overprotective. It seems possible that the wages claimed as the cost of care are for domestic assistance for Mrs Choi's family or husband. Mrs Choi informed Dr Buckley that she had a carer between three and fives a week, for five hours on each occasion. The carer assisted her with cleaning and cooking and they walked together for about an hour. Sometimes the carer massaged her shoulders. 188 Dr Buckley thought it unlikely that Mrs Choi needed any independent daily supervision by carers or that in the future she would need the services of any professional person to care for her. I accept that opinion. 189 There is a claim for the cost of a case manager for four hours per month and for the provision of a handyman for three hours per week. Although Dr Buckley considered it reasonable for these services to be provided I do not propose to make any allowance because of the unsatisfactory nature of the evidence of the help said to have been provided and because of the tendency of Mrs Choi to make exaggerated claims. 190 The total allowance for care is $3,000.00. Total assessment 191 I assess damages in total at $718,259.95. Costs The plaintiff's claim 192 In view of Mrs Choi's ignorance of and then uncertainty about the contractual arrangements between the Council and Prestige, it was reasonable for her to commence and sustain her action against both parties. Having failed in her claim against the Council, she should pay the Council's costs on a party-party basis. Counsel for Mrs Choi did not resist such an order but sought a Bullock order that Prestige indemnify her for the costs so ordered. Counsel for Prestige did not resist such an order. 193 Counsel for Prestige sought a special order concerning the costs of the evidence of Kim Eun Jung, namely that the plaintiff ought to have to pay Prestige's costs. The circumstances were these. The trial began on 11 October 2006. By that time the plaintiff had served a statement of Miss Kim and of her mother, Mrs Kim. Photographs of a tree had been taken. Mrs Kim's statement dealt with a conversation she had had with Miss Kim which left it unclear, it was submitted, whether Miss Kim could identify the tree from which the branch had fallen or who took the photographs or when. Accordingly to Mrs Kim, Miss Kim said that she and Mrs Choi were sitting on a bench when the branch fell. In contrast, when Miss Kim gave evidence she plainly stated that she had returned to the scene on the following day and had taken photographs of the tree from which the branch fell. She and Mrs Choi were sitting on the grass. It was submitted that the failure to serve a statement to that effect before the hearing "had the effect of leaving in issue matter which did not need to be and, of thereby increasing costs". 194 I do not accept that submission. It implies that if Prestige had known what Miss Kim was going to say it would not have required her to give evidence at all. I have considerable doubts about that. It seems likely that even if both sides had had a statement in accordance with the tenor of the evidence Miss Kim eventually gave, it would have been necessary to call her to give evidence. Miss Kim gave her evidence via videolink from Korea. It did not take long. Prestige chose to defend that as well as the other issues and ought to pay the costs. 195 Accordingly, I shall order Mrs Choi to pay the Council's costs of her claim against it and shall order Prestige to indemnify her. I shall order Prestige to pay Mrs Choi's costs of her claim against it and the Council on a party-party basis. The cross-claims between the Council and Prestige 196 In the first cross-claim the Council sought indemnity or contribution from Prestige. As part of the second cross-claim Prestige sought indemnity or contribution from the Council. Both cross-claims raised the same broad issues, notably whether the tree was dangerous, whether Prestige was negligent or in breach of the terms of its contract and whether the Council was liable for its own negligent acts, omissions or wilful default. In the attribution of blame between the Council and Prestige two fundamental questions were whether the Council's duty to users of Hyde Park was delegable and whether it had been delegated. 197 As between the Council and Prestige, all these questions were answered in favour of the Council. 198 Although the Council's cross-claim was dismissed, it ought not for these reasons and because the costs of its cross-claim must have been modest, to have to pay Prestige's costs. 199 On ordinary principles, Prestige, having cross-claimed against the Council and lost, ought to pay the Council's costs on a party-party basis. The cross-claim between Prestige and Active Tree Services 200 Prestige brought in Active Tree Services as a cross-defendant and lost its case. It should pay Active Tree Services' costs. Active Tree Services submitted that those costs ought to be on an indemnity basis. Two reasons were put forward for this, namely that Prestige brought a baseless claim and that it refused an offer of compromise. 201 Paragraph 9 of the second cross-claim is as follows - By an agreement made in or about June 1998 between Prestige and Active Trees, made partly in writing and partly orally ('the sub-contract'), Active Trees agreed, inter alia, to: (a) undertake and perform that part of the obligation of Prestige pursuant to clause 3.3 of the Specification for Maintenance of Parks, Open Space Areas and Street Trees of the Agreement, in respect of Hyde Park in Sydney City; and (b) by clause 3.3(c) of the said specification, to "remove all dead, dangerous and fallen branches in accordance with the best practices of the Arboricultural Trade and dispose of the same from site". Particulars That part of the agreement in writing as contained in the letter of 16 January 1997 (sic-1998) from Active Trees to Prestige and clause 3.3 of the Specification for Maintenance of Parks, Open Space Areas and Street Trees. 202 Prestige knew before the hearing began that the written part of the agreement pleaded, Mr Willcocks' letter dated 16 January 1997, was not evidence of any agreement by Active Tree Services to remove dangerous branches or to comply with the literal requirements of cl 3.3 of the Specification. Prestige knew that before he wrote that letter Mr Willcocks had told Mr McCallum that the Specification was too wide. Prestige had Mr Willcocks' statement, dated 6 July 2006, setting out these matters. At the hearing, Prestige adduced no evidence to support the assertion of a partly oral agreement to remove dangerous branches. In the end counsel was reduced to proposing an inference of such an agreement from the "factual matrix" I have mentioned. 203 In written submissions, counsel for Prestige conceded that Mr McCallum did not give evidence of any particular conversation with Mr Willcocks in which Mr Willcocks agreed to undertake responsibility for the removal of dangerous branches under cl 3.3 of the Specification. Counsel submitted nevertheless that the absence of such evidence did not justify a finding that Prestige should have known that it had no chance of success against Active Tree Services such that an order for indemnity costs would be appropriate. It was submitted that the existence of an oral term of the type contended for by Prestige might, from Prestige's point of view at the beginning of the case, have been proved by inference from other evidence or through the cross-examination of Mr Willcocks or Mr Dubiez. Reference was made to work done as recorded in worksheets. 204 I do not accept these submissions. Prestige could have had no reasonable expectation that it might make out its case pleaded by cross-examining Mr Willcocks or Mr Dubiez. Even if it thought there was room in the worksheets for a conclusion that Active Tree Services' removal of dangerous or unsafe branches might be linked to the sub-contract, Prestige also knew that Active Tree Services had carried out many items of work outside the obligations of its general contract as requested from time to time and separately charged for. Moreover, the argument based on the "factual matrix" was an attempt to rely on a contract by inference, a case never pleaded. 205 The offer of compromise was contained in a Calderbank letter, which was written in these circumstances. The case was originally set down to commence on Monday, 9 October 2006. It was called on for hearing on Wednesday, 11 October 2006 at 10am. Active Tree Services' letter was sent after 4pm on 11 October and received by Prestige the same evening or early on the following morning. 206 Prestige had effectively two working days, the second and third days of hearing, to respond to the letter or decide to ignore it. That period was short, but in my estimation adequate for proper consideration, bearing in mind that Prestige then knew what it was undertaking to prove and must have known that it did not have the necessary evidence. Knowing what it did, Prestige needed no more than a few hours to make up its mind. 207 The two factors put forward by Active Tree Services combine to persuade me that Active Tree Services' costs should be on an indemnity basis. Active Tree Services' cross-claim against its insurer 208 Active Tree Services' cross-claim against its insurer was predicated on Active Tree Services' liability to indemnify Prestige. Active Tree Services was found to have had no such liability and its cross-claim has been dismissed. Even so, Active Tree Services has asked that the insurer pay its costs or such of its costs as it is unable to recover from Prestige. The insurer asks for costs as following the event, but partly on an indemnity basis. 209 Although the cross-claim against the insurer assumed that Active Tree Services was liable to indemnify Prestige, that issue was not litigated between Active Tree Services and the insurer, which took no part in Active Tree Services' defence of Prestige's claim. The insurer admitted the policy and the obligation to indemnify Active Tree Services according to its terms, but asserted that liability of the kind assumed by Active Tree Services did not fall within the policy. 210 Active Tree Services' joinder of the insurer depended on proof of a liability that had not been established and that Active Tree Services was resisting. The only issue in the case between Active Tree Services and the insurer was whether, if Active Tree Services was indeed liable to Prestige, its liability was of a kind contemplated by the policy. Although it had an interest in doing so, the insurer played no part in contesting Prestige's attack on Active Tree Services. 211 On the failure of Prestige's cross-claim it became unnecessary to determine the issue on the insurance policy. Notwithstanding Active Tree Services' submissions, that issue cannot be now be litigated, having merged in the judgment: Thoday v Thoday [1964] P 181 at 197-8; Workington Harbour Board v Trade Indemnity Co Limited (No 2) [1938] 2 All ER 101 at 106. 212 Counsel for Active Tree Services made an alternative submission, citing cl 5 of the policy, which provided for the insurer to pay reasonable costs and expenses incurred with the insurer's prior consent, inter alia, in the defence of any claim under the policy. 213 That submission was an afterthought and should not be accepted. Active Tree Services never pleaded cl 5 or attempted to prove circumstances giving rise to the operation of cl 5. The first time cl 5 was raised was in the written submissions filed on the question of costs. Besides, the issue of any liability on the part of the insurer to pay such costs has merged in the judgment. 214 Active Tree Services' joining the insurer to a lengthy and complicated dispute was wasteful. Active Tree Services could have waited to see whether it was legally liable to Prestige before bringing on any action against its insurer. That action, if necessary, would have lasted only a day or two given the narrow issue involved in it. The result that eventuated was foreseeable to Active Tree Services. Active Tree Services could easily have relieved the insurer of the need to run up costs by deferring trial of the insurance policy issue pending the result of Prestige's claim. 215 I am not satisfied that anything but the ordinary rule should apply, namely that costs of Active Tree Services' cross-claim against its insurer should follow the event. 216 The solicitor for the insurer wrote three letters to Active Tree Services offering to compromise the action. The first, dated 28 November 2005, offered a verdict for the insurer with the insurer paying its own costs to date. The solicitor for Active Tree Services replied on 23 January 2006, mentioning attempts to compromise Prestige's cross-claim and asking whether the insurer was prepared to consent to Active Tree Services' discontinuance of its cross-claim with each party to bear its own costs. On 27 January the solicitor for the insurer asked for clarification and on 30 January Active Tree Services' solicitor wrote to say that the offer of discontinuation was conditional upon the insurer paying its own costs and Prestige discontinuing and paying Active Tree Services' costs. This second condition was outside the insurer's control, of course. Active Tree Services was unable to secure such an arrangement with Prestige and no settlement resulted. 217 On 3 March 2006 the solicitor for the insurer wrote again, offering discontinuance with each party bearing its own costs. The offer was expressed to be open until 5pm on 22 March 2006. The circumstances were that the hearing was approaching and costs were being run up with appearances before registrars and the like. The solicitor for Active Tree Services did not respond. 218 On 11 October 2006, the first day of hearing, the solicitor for the insurer again wrote to Active Tree Services. The offer was for the payment of $55,000.00 on condition that there should be a verdict for the insurer and no order as to costs. The offer was expressed to remain open until the end of that week, namely 5pm on Friday 13 October 2006. The offer was not accepted. 219 At the time of the first letter things were no doubt difficult for the solicitor for Active Tree Services, trying simultaneously to settle claims by Prestige and against the insurer. Of course, that difficulty was of Active Tree Services' own making. The claim that raised the simple question whether liability of the kind asserted by Prestige was covered by the policy could have been deferred, to be litigated only if Prestige succeeded against Active Tree Services. The offer was open for a long time. Active Tree Services ultimately rejected it in order to hedge its bets. But Active Tree Services was trying, I think, to make a constructive response to the letter and I would not say that the rejection of the offer was in all the circumstances then obtaining unreasonable. 220 The failure to accept the offers contained in the second and third letters was, however, unreasonable. The solicitor for Active Tree Services must have realised that negotiations with Prestige were not resulting in a successful compromise. Active Tree Services' continuing to tie the insurer to the dispute about Active Tree Services' possible liability to Prestige was unreasonable. It was unreasonable for Active Tree Services not to respond to the offers in those letters. 221 The failure to respond to a reasonable letter of offer does not carry with it any automatic right to indemnity costs, but I think in all the circumstances, that that would be a just result. I will order that Active Tree Services pay the insurer's costs on a party-party basis up to 5pm on 22 March 2006 and thereafter on an indemnity basis. 222 Counsel for Active Tree Services asked for an order that Prestige indemnify it for any costs of the insurer that it should be ordered to pay. It was submitted that it was foreseeable to Prestige that its joining Active Tree Services would lead to further cross-claims. So Prestige's unsustainable allegations in its cross-claim against Active Tree Services "led directly to the additional litigation, and consequent expense, of the third cross-claim". 223 I do not accept that submission. The nature of the dispute between Active Tree Services and its insurer was foreign to that between Prestige and Active Tree Services. It is not apparent to me how Prestige could have known that any dispute would arise between Active Tree Services and its insurer. No doubt any commercial organisation that sues another might expect that that other will involve its insurer in the defence of the claim, but that is far from an expectation that the insurer will be joined as a party, bringing into question another set of costs. Active Tree Services' cross-claims against the Council and Prestige 224 Active Tree Services sought indemnity or contribution from the Council and Prestige. These cross-claims raised no issue not already raised and occasioned no evidence which would not otherwise have been adduced. The costs of this part of the third cross-claim should not be the subject of any order. Orders 225 The orders of the Court are as follows - In the plaintiff's claim - 1. A verdict for the first defendant, City of Sydney Council, in the claim of the plaintiff, Yun Hee Choi. 2. A verdict for the plaintiff, Yun Hee Choi, against the second defendant, Prestige Property Services Pty Limited, in the sum of $718,259.95. Interest is not to run until 21 days after the second defendant has received from the plaintiff a completed Health Insurance Commission form and a Centrelink clearance. 3. The plaintiff is to pay the first defendant's costs and the second defendant is to indemnify her. The second defendant is to pay the plaintiff's costs of suit against both defendants. In the first cross-claim - 4. A verdict for the first cross-defendant, Prestige Property Services Pty Limited. 5. I make no order as to costs. In the second cross-claim - 6. A verdict for the first cross-defendant, Active Tree Services Pty Limited. 7. I order the cross-claimant, Prestige Property Services Pty Limited, to pay the costs of the first cross-defendant, Active Tree Services Pty Limited, on an indemnity basis. 8. A verdict for the second cross-defendant, City of Sydney Council. 9. I order the cross-claimant, Prestige Property Services Pty Limited, to pay the costs of the second cross-defendant, City of Sydney Council. In the third cross-claim - 10. A verdict for the first cross-defendant, P Matson on behalf of the Underwriting Members of Syndicate 990. 11. I order the third cross-claimant, Active Tree Services Pty Limited, to pay the costs of the first cross-defendant, P Matson on behalf of the Underwriting Members of Syndicate 990. Those costs are to be assessed on a party-party basis up to 5pm on 22 March 2006 and thereafter on an indemnity basis. 12. A verdict for the second cross-defendant, City of Sydney Council. 13. I make no order as to the costs of Active Tree Services Pty Limited and City of Sydney Council. 14. A verdict for the third cross-defendant, Prestige Property Services Pty Limited. 15. I make no order as to the costs of Active Tree Services Pty Limited and Prestige Property Services Pty Limited. ************ 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.