Dear Colleagues;

The decision of the High Court of Australia today in Parkes Shire Council v South West Helicopters Pty Limited [2019] HCA 14 (8 May 2019) http://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/HCA//2019/14.html deals with the question whether a claim for psychological harm by the family of someone killed in an aviation accident, is governed by the Australian legislation implementing various international conventions on liability for air accidents. The court concludes (main judgment by KIEFEL CJ, BELL, KEANE AND EDELMAN JJ, Gordon J agreeing in a slightly more detailed separate judgment) that the answer is yes; this sort of civil liability satisfies the criterion of “damage sustained by reason of the death of the passenger” under s 28 of the Civil Aviation (Carriers' Liability) Act 1959 (Cth) ("the CACL Act"). Hence damages are recoverable under the strict liability entitlement created by s 28; but such damages are limited by the “cap” imposed by the Act (currently $500,000), and most importantly for the family here, are subject to a strict 2-year limitation period which had not been met. So in the end the family members were not able to recover because they had not filed in time.

The other key feature of liability created by s 28 is that it is “exclusive” of all other forms of possible liability (s 35(2)), which means that no separate claim for negligence under general common law principles could be made (which would have had a more generous limitation period). Clearly this scheme is a trap for inattentive solicitors who are not aware of these quite significant provisions governing even purely domestic air travel accidents.

Gordon J spends more time discussing why this Federal Act is constitutionally able to over-ride the usual State common law; the relevant international conventions do not apply to purely domestic air travel, and the trip here (an inspection flight by helicopter commissioned by Parkes Council) was not only internal to Australia, it was intra-State and so would not on general principles have been subject to Federal law. (This part of the CACL Act, Part IV, explicitly applies to domestic air travel, but clearly Part IV cannot be justified by reference to the “external affairs” power as it seems that the other parts of the CACL Act can). The short answer is that the NSW Parliament agreed to adopt the provisions of the Federal law as applicable to local NSW claims, under the Civil Aviation (Carriers' Liability) Act 1967 (NSW) ("the Carriers' Liability Act (NSW)"). Hence it over-rides other relevant State law, such as the Civil Liability Act 2002 (NSW) (noted briefly by Gordon J at [119]-[120].

Of some interest to Australians will be that the court has to deal with an earlier decision to opposite effect by the Full Court of the Federal Court in South Pacific Air Motive Pty Ltd v Magnus (1998) 87 FCR 301 (where by majority that court had held that psychological harm claims by relatives were not limited by the CACL Act.) At the earlier state of the Parkes proceedings, however, the NSW Court of Appeal by majority had declined to apply Magnus, a decision now affirmed by the High Court. But the High Court majority here, somewhat oddly, do not explicitly say that Magnus has now been over-ruled. The closest they come is where they say at [35]: “The dicta in Magnus on which Leeming JA relied should not be followed”. Gordon J is somewhat clearer at [114]:

“To the extent that the decision of the Full Court of the Federal Court in South Pacific Air Motive Pty Ltd v Magnus holds to the contrary, that part of the decision should not be followed”.

I was also interested to note that no members of the HC refer to one would think should have been a dilemma for the NSWCA here, created by the controversial but apparently still binding principle in Farah v Say-Dee that intermediate appellate courts in Australia ought to follow the decisions of co-ordinate appellate courts (such as that of the Full Court of the Federal Court) unless convinced they are “plainly wrong”. Here the decision of the majority of the NSWCA has been justified. It may be that the current High Court is not so keen to pounce on lower appellate courts these days for departing from Farah principles.

Regards

Neil

NEIL FOSTER

Associate Professor, Newcastle Law School

Faculty of Business and Law

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