The Supreme Court of the Australian Capital Territory recently considered whether a 12 year-old plaintiff injured while riding in an inflatable circular tube being towed by a motorboat was time-barred from commencing proceedings and whether the defendant could rely upon the ‘obvious risk of a dangerous recreational activity’ defence under civil liability legislation.
The decision provides useful guidance for insurers regarding:
- the operation of the Limitation Act 1969 (NSW) and when a cause of action is ‘discoverable’ in the context of pre-existing medical conditions and child plaintiffs;
- whether a recreational activity is ‘dangerous’ for the purposes of civil liability legislation;
- whether a risk would be ‘obvious’ to child plaintiffs; and
- the assessment of economic loss in the context of pre-existing medical conditions.
Facts
The plaintiff was 12 years old when he went ‘tubing’ at Burrinjuck Dam in New South Wales in late January 2015. He was towed along the water in an inflatable circular tube by a motorboat driven by the defendant. While he was being towed, the tube flipped.
The plaintiff alleged that the incident caused his underlying back condition to be symptomatic.
The plaintiff commenced proceedings on 2 July 2018, more than three years after the accident.
The defendant pleaded that the proceeding was time-barred and even if the action had been brought within the limitation period, it was not liable as the harm arose from an obvious risk of a dangerous recreational activity (s5L of the Civil Liability Act 2002 (NSW) (CLA)).
The substantive law of New South Wales applied to the claim because the accident occurred in that state.
Limitation issues
The critical issue was whether the proceeding had been commenced within 3 years of the cause of action becoming ‘discoverable’ on the basis that the plaintiff’s parents knew of the following facts:
- the injury had occurred;
- the injury was the fault of the defendant; and
- the injury was sufficiently serious to justify bringing proceedings on the cause of action.
The Court noted the following relevant matters:
- the plaintiff first saw a general practitioner regarding the injury in July 2015 and was referred for x-rays and to an orthopaedic surgeon. The x-rays in July 2015 revealed the presence of the underlying spinal condition;
- he was reviewed by the orthopaedic surgeon in November 2015 and January 2016. The Court found that it was necessary for the plaintiff to have the benefit of a specialist consultation (and pursuing physiotherapy) to form a view whether the injury was sufficiently serious to justify proceedings;
- although the plaintiff’s father was a lawyer with knowledge of personal injury law, it was prudent for the plaintiff to receive legal advice from someone who was not a relative as to whether there was a cause of action; and
- the plaintiff was most likely to be aware that the claim was actionable in August or September 2016 when his father arranged for him to receive separate legal advice (from the father’s business partner).
The Court found that the limitation defence failed because the earliest the plaintiff had knowledge of the claim being legally actionable was in February 2016 and therefore his court proceedings were in time when commenced on 2 July 2018.
Breach of duty?
The Court held that the defendant had breached his duty of care to the plaintiff because:
- he had not told the plaintiff any hand signals to use to slow the boat down or what to do if the tube flipped. Consequently, the plaintiff had no way to exercise control over the ride or knowledge of how to flip or fall into the water in a safe manner, namely by letting go of the tube;
- the lack of instruction meant the tube travelled at a speed which was faster than what the plaintiff was comfortable with; and
- he had driven the boat faster than it should have been when he was towing a 12 year-old boy (who had not been properly instructed) in a zig-zag path to create a wake which the tube had to cross and could flip the tube.
Dangerous recreational activity?
The Court rejected the defendant’s argument that tubing was a risky and dangerous activity.
The Court noted that while there was a real risk of physical harm if the tube flipped over, the risk of serious harm was remote in circumstances where the rider was wearing a life jacket and other precautions (use of a spotter and the tube being a sufficient distance from the boat) were being observed.
Obvious risk?
Despite concluding that tubing was not a dangerous recreational activity, the Court went on to consider whether the risk was ‘obvious’.
The Court noted that the critical part of the ‘obvious risk’ defence was whether the risk was obvious to a reasonable person in the position of the plaintiff. This meant assessing ‘obviousness’ from the perspective of a 12 year-old child who had not received any instruction about any potential risk and whose previous tubing experience involved being towed in a straight line at a sedate pace.
Accordingly, the Court found that there was no materialisation of an obvious risk because the plaintiff being a 12-year-old child would not have had an appreciation of the need to let go of the tube when it flipped to avoid the risk of injury.
Assessment of economic loss
Subsequent to the accident the plaintiff had been involved in a number of motorbike accidents and suffered a number of sporting injuries.
The Court found that the plaintiff’s spondylolysis would have been rendered symptomatic independently of the subject accident. The court noted that the most likely outcome was that the boating accident had no impact on the plaintiff’s earning prospects. However, the court found that a modest buffer of $50,000 was appropriate to reflect the possibility the accident had delayed the plaintiff’s training and his entry into full-time employment.
Commentary
The decision is particularly relevant for insurers of pleasure craft.
Speedboats towing inflatable tubes are a common sight on Australian waterways in summer. The decision is particularly relevant for insurers of pleasure craft as it highlights the potential challenges they may face in defending claims from tubing accidents due to a lack of thorough instruction or appreciation of the risk by the injured party. These challenges will be increased if the injured party is a child.
Further, despite the potentially high boat speeds involved in tubing, the Court’s finding that tubing was not a dangerous recreational activity creates uncertainty as to the availability of obvious risk defences under civil liability legislation. However, in different circumstances (where the tube is being towed at high speed or in poor conditions) a court may be prepared to characterise the activity as ‘dangerous’.
More generally, the decision illustrates the potential challenges to insurers in claims involving limitation issues, potential obvious risk defences and pre-existing conditions and intervening injuries. The decision is a reminder that:
- when raising defences based on an expiry of the limitation period, the plaintiff’s medical and treatment history should be carefully considered. The passage of time required to access specialist medical advice or waiting to see if an injury will resolve will be relevant to the court’s assessment of when a plaintiff ought to have known an injury was sufficiently serious to justify bringing an action;
- the prospects of successfully raising a defence based upon ‘obvious risk’ are uncertain when the plaintiff was a child at the time of the injury. This defence usually depends upon the plaintiff having some appreciation of the risk of the activity and courts will usually be reluctant to find that a child was in a position to appreciate the risk of an activity, particularly if they have had limited experience or instruction in the activity; and
- pre-existing conditions and intervening injuries are not fatal to a claim for economic loss. Depending upon the plaintiff’s age and circumstances, an injury that has had no obvious effect upon their earning capacity may still lead to an award of damages for economic loss to reflect the possibility of some reduction in earnings.
This article was written by Anthony Highfield, Partner and James McIntyre, Special Counsel.
