On 8 May 2019 the High Court of Australia NSW unanimously held that non-passenger claims for nervous shock arising from the death of a passenger, cannot be maintained against a carrier due to the exclusive liability provided under the Civil Aviation (Carrier’s Liability) Act 1959 (Cth) (the “CACL Act“).
In February 2006, two Parkes Shire Council employees, Ian Stephenson and Malcom Buerckner, were killed in a helicopter crash during an aerial noxious weed survey. Parkes Shire Council engaged South West Helicopters Pty Ltd (“South West“) to provide the helicopter and pilot for the survey. The accident led to a number of claims and cross-claims in the Supreme Court. The issues relevant to air carriers concerned the Stephenson’s family dependency claim, and separately the claims made by the Stephenson family members for damages for nervous shock.
High Court decision
The issue in the appeal was whether a claim under the general law of tort for damages for negligently inflicted psychiatric harm (nervous shock) consequent upon the death of a passenger during air carriage to which Pt IV of the CACL Act applies was precluded by the Act.
Section 28 of the CACL Act provides that where Part IV of the Act 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”. Section 28 is picked up from Article 17 in the relevant international Warsaw and Montreal 1999 Conventions, to uniformly apply the liability regime to air carriage within Australia to which Part IV applies.
Section 35(2) of the CACL Act provides that the liability under Part IV “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”.
The High Court of Australia unanimously held in a joint judgment of Kiefel CJ, Bell, Keane, and Edelman JJ, and in a separate judgment of Gordon J that the Stephensons were entitled to claim against South West for damages for loss suffered by them by reason of Mr Stephenson’s death pursuant to s 28 of the Act. The Court held that s 35(2) substituted that entitlement for any claim that might otherwise have been brought under the general law of tort by non-passengers for damages for negligently inflicted psychiatric harm (nervous shock).
In coming to this decision, the High Court considered the vast international authorities on the exclusive operation of the Conventions to the air carriage liability regime, and noted that the literal words of section 28 are broad, capturing “damage sustained by reason of the death of the passenger” to which section 35(2) is equally broad.
Gordon J found:
“With two very limited exceptions, it applies to make liability under section 28 (and related limitations) a substitute for any civil liability of the carrier under any other law in respect of the death of the passenger. Any liability to Mr Stephenson’s family that might have been found to exist under the Civil Liability Act for psychiatric injury resulting from the sudden shock of Mr Stephenson’s death was liability under “any other law” in respect of the death of Mr Stephenson.
Section 35(2) therefore operated to preclude the Stephenson family from bringing a claim in respect of that psychiatric injury other than in accordance with Pt IV of the Carriers’ Liability Act (Cth), namely within the two-year limitation period prescribed in s 34 of the Carriers’ Liability Act (Cth).”
Good news for airlines and air carriers
The High Court decision is welcome news for airlines and air carriers, as it is now clear that non-passenger claims for psychiatric harm (nervous shock) cannot be brought against the carrier in the general law of tort. This overrules an earlier decision of the Full Federal Court of Australia in South Pacific Air Motive Pty Ltd v Magnus  FCA 1107, which allowed a non passenger to claim psychiatric harm (nervous shock) under the general law of tort against an air carrier, outside the CACL Act regime.
In addition, whilst the Stephensons’ claims were in respect of air carriage within Australia arising from the death of a passenger, it would follow, due to the similar wording of the enacting provisions of the Warsaw and Montreal Conventions contained in the CACL Act, that the exclusive application of the CACL Act regime will also apply in respect of any non passenger claims arising out of international air carriage resulting in the death or personal injury of a passenger to which the Conventions apply.
This article was written by Matthew Brooks, Partner.
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