Aviation Law – Case Note: Parkes Shire Council v South West Helicopters Pty Ltd [2019] HCA 14

On 2 February 2006, a helicopter operated by South West Helicopters Pty Ltd (the Respondent) was engaged in low-level aerial noxious weed survey operations under contract for Parkes Shire Council (the Appellant).  During the operation, the helicopter collided with power lines and crashed, causing the tragic deaths of the pilot and two employees of the Appellant.  In the second aviation law case to reach the High Court of Australia in 2019, this accident raised the issue of the scope of the so-called ‘exclusivity provision’ under Part IV of the Civil Aviation (Carriers’ Liability) Act 1959 (Cth) (the ‘CACL Act’).

Claims for air passenger injury and death are governed by a specialised legislative scheme under the CACL Act, and similar Acts in each State which apply the provisions of the CACL Act.  This scheme is separate from the usual legislative scheme that applies to claims for personal injuries (under State-based legislation such as the Civil Liability Act 2002 (NSW) (the ‘CLA’)) and wrongful death (under legislation in each State based on ‘Lord Campbell’s Act’[i] such as the Compensation to Relatives Act 1897 (NSW) (the ‘CRA’)).  It is important to recognise this as there are differences between the CACL Act scheme and the usual schemes that apply to many claims for compensation due to negligence. Some of those differences are highlighted in this case.

The family of one of the passengers commenced proceedings against both the Appellant and the Respondent in the District Court of New South Wales in 2009.  The matter was later transferred to the Supreme Court.  The proceedings included claims:

  • Under the CRA for the death of the passenger; and
  • Under the CLA for ‘nervous shock’ suffered by each of the family members.

But there was no claim under s 28 of the CACL Act, which is within Pt IV of that Act and provides:

Subject to this Part, where this Part applies to the carriage of a passenger, the carrier is liable for damage sustained by reason of the death of the passenger or any bodily injury suffered by the passenger resulting from an accident which took place on board the aircraft or in the course of any of the operations of embarking or disembarking.

These claims were commenced within three years after the accident, which is the period allowed under both the CRA and the CLA.[ii]  However, the CACL Act provides that the right to claim is ‘extinguished’ if the claim is not commenced within two years.[iii]  So it was important to determine which scheme should apply:  the CACL Act or the CLA/CRA.

Important to this question is the so-called ‘exclusivity’ provision, which says that where the CACL Act scheme applies, it applies to the exclusion of the claimant’s rights against the carrier under any other law.  For a claim relating to the death of a passenger, the provision is s 35(2), which states:

Subject to section 37[iv], the liability under this Part is in substitution for any civil liability of the carrier under any other law in respect of the death of the passenger or in respect of the injury that has resulted in the death of the passenger.

This provision has the effect that where a person has a claim against the carrier under the CACL Act, that claim replaces all other claims the person might have against the carrier, and prevents the person from making any of those other claims.

Supreme Court and Magnus

At trial, the Supreme Court considered the case of South Pacific Air Motive v Magnus[v](‘Magnus’) heard in the Full Court of the Federal Court of Australia in 1998.  In that case, an aircraft ditched into Botany Bay shortly after takeoff from Sydney Airport.  Most of the passengers aboard the aircraft were school children who were to attend a school camp.  The takeoff and subsequent accident were witnessed by the parents of the passengers, many of whom suffered psychiatric harm following the accident, although all passengers survived.

In Magnus, the parents’ claims against the carrier for their psychiatric harm were, similarly to this case, commenced after the two-year period specified in s 34 of the CACL Act.

In the Full Court of the Federal Court, Sackville and Hill JJ, in the majority, held that claims for psychological injuries by non-passengers are outside the scope of s 35(2) of the CACL Act, so could be made under other schemes outside the CACL Act.[vi]  In dissent, Beaumont J took a more literal reading of the CACL, saying that a non-passenger could fall within the terms of the scheme if they suffered psychological damage by reason of the death or personal injury of a passenger.[vii]

The result in Magnus was that the parents’ claims were allowed as they fell outside the scope of the ‘exclusivity’ in ss 35(2) and 36[viii] of the CACL Act, so their claims could be brought outside it.

Returning to the present case, the Supreme Court of NSW followed the decision in Magnus, allowing the family’s claims to proceed.

The Court of Appeal

In the Court of Appeal, Basten JA, in the majority, considered the case of Magnus but said it was of limited relevance because it did not involve the death of any of the passengers.  His honour said, in this case, it was not possible to consider the claims of the family as being anything other than ‘in respect of’ the death of the passenger.  This meant that the claim was within the scope of s 35(2) and so must be made under the CACL Act.  Accordingly, as the claim was not commenced
within two years of the accident, it should have been dismissed.

The High Court

A majority of the High Court of Australia (Kiefel CJ, Bell, Kean and Edelman JJ) agreed with the reasoning of Basten JA in the Court of Appeal that the claims of the family were in respect of the death of the passenger as ‘[t]here was an immediate and direct relationship between the asserted liability of the carrier and the death of the passenger’.[ix]

Overturning Magnus, the majority went on to explain that the liability under s 28 of the CACL Act is ‘event-based’,[x] but particularly:

it is not fault-based in terms of the domestic law of civil wrongs, nor, importantly, is it tied to a contractual relationship between carrier and passenger.  The persons who may sustain damage that may be the subject of a claim under s 28 are not confined to those who are carried pursuant to a contract of carriage.

Accordingly, the majority found that the broad language of the ‘exclusivity’ provision in s 35(2) meant that there was no other basis for a carrier’s civil liability other than under the CACL Act.[xi]

The appeal was therefore dismissed.  The result of this was that the Appellant could not claim against the Respondent as a joint tortfeasor – that is, the carrier was not jointly liable with the Council.

Analysis

This decision was highly anticipated by aviation lawyers as it clarified part of the law relating to an air carrier’s liability.  The decision in Magnus was often cited as a basis for the close family members of a deceased passenger to make a claim outside the CACL Act.  This decision makes it clear that the ‘event-based’ liability under Pt IV the CACL Act is actionable by all claimants who claim against an air carrier in relation to the death or injury of a passenger in flight or in the course of embarking or disembarking from an aircraft on a commercial flight.  However, it must be actioned in accordance with the CACL Act, and there is no claim available for such people outside the CACL Act.

There are several consequences for injured passengers, or the family members of deceased passengers.  First, since the liability of the carrier is event-based, not fault-based, there is no need to prove that the carrier was negligent or at fault.

However, claims must be made within the strict rules of the CACL Act.  For one thing, the claim must be made – that is, the court proceedings must be commenced – within two years of the accident.  After that, the right to claim against the air carrier is lost forever.  For another, there is a limit of $725,000 on the liability of the carrier, on a per passenger basis.[xii]  Importantly, though, these conditions do not apply to claims against anyone other than the carrier, its employees or agents.  So, for example, claims against an aircraft manufacturer, an airport operator or a regulatory authority may still exist.

Although being relieved of the requirement to prove negligence is an advantage, the decision overall has a disadvantage for the grieving family members of those who lose their lives in air accidents:  exposure to the uncertainty that any claim for psychiatric harm is compensable at all.  Under the CLA scheme, it is legislated that certain psychological impacts can be compensated.  But under the CACL Act, with its focus on the ‘bodily injury’ claims of surviving passengers, it is uncertain whether the psychological issues are compensable, even for the close family members of those passengers who tragically lose their lives in air accidents.  This decision says that such claims are within the ‘exclusivity’ clauses under section 35(2) and section 36 of the CACL Act, but leaves open the possibility that they are not within the scope of
liability of the carrier under section 28.

If you or anyone you know has been injured or lost their life in an aircraft accident, our aviation lawyers are available to discuss your options.

Bradley Hayward

Principal


[i] Fatal Accidents Act 1846 (Imp.)

[ii] Limitation Act 1969 (NSW) s 50C.

[iii] Civil Aviation (Carriers’ Liability) Act 1959 (Cth) s 34.

[iv] Section 37 of the CACL Act provides that two kinds of liability are not excluded.  First, the liability to indemnify an employer of the passenger for payments made to the passenger in the nature of workers’ compensation under a law of the Commonwealth or of a State.  Secondly, the liability to pay contribution to a co-tortfeasor.

[v] [1998] FCA 1107; (1998) 87 FCR 301.

[vi] Magnus at 348-349 per Sackville J; at 321 per Hill J.

[vii] Magnus at 318.

[viii] Section 36 provides that claims related to the personal injury, not causing death, of a passenger are in substitution for the carrier’s liability under any other law.  This is essentially the equivalent of s 35(2), but in relation to injury claims.

[ix] Parkes Shire Council v South West Helicopters Pty Ltd [2019] HCA 14 at [29].

[x] Parkes Shire Council v South West Helicopters Pty Ltd [2019] HCA 14 at [34].

[xi] Parkes Shire Council v South West Helicopters Pty Ltd [2019] HCA 14 at [34].

[xii] Civil Aviation (Carriers’ Liability) Act 1959 (Cth), s 31(a).

[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]