Wise Bros Pty Ltd v Commissioner for Railways (NSW) [1947] HCA 33; (1947) 75 CLR 59 (17 September 1947)

Wise Bros Pty Limited Defendant, Appellant; and The Commissioner for Railways (New South Wales) Plaintiff, Respondent.

The appellant company owned and operated a flour mill at Narrandera. The premises consisted of a store for flour, a flour mill, and on the west of these buildings a factory in which sheep food, known as sheep nuts, was manufactured. The buildings adjoined a railway siding belonging to the respondent, the Commissioner for Railways. On 13th October 1944 a fire broke out which destroyed the nut factory, the store and the mill and spread to the property of the Commissioner and there destroyed a number of railway carriages and trucks and damaged other property belonging to the Commissioner. The Commissioner sued the appellant company for damages. The declaration contained three counts. The first count alleged negligence in the conduct of the business of the company upon its land adjoining the lands of the plaintiff and in allowing inflammable matter to be on the land. The second count alleged negligence in a non-natural user of its land involving accumulation of combustible matter without the provision of proper fire-fighting equipment and materials. The third count alleged a non-natural user of the company's land involving an accumulation of quantities of combustible matter, and the starting of a fire on the land which extended and spread to the said accumulations and escaped therefrom to the Commissioner's land and property. Thus the first and second counts alleged negligence, and the third count relied upon absolute liability in respect of damage caused by the escape of fire from the company's land, irrespective of negligence.

The origin of the fire was unexplained. A number of witnesses gave evidence as to the place where the fire started. The witnesses observed the fire at different stages and from different places. The fire spread very rapidly and with great violence. Some witnesses saw it first in a pile or piles supporting the floor of the flour mill. Others first observed the fire when it was burning in the nut factory which was at the west of the flour mill. The source of power for the operation of the flour mill was electricity. There was also a boiler and a stationary engine in a shed variously described as twenty to forty-five feet away from the southern boundary of the main building. The boiler was heated by a fire and was used for cooking the sheep nuts. According to the evidence, the fire started on the northern side of the flour mill, or on the western end of the nut store. There was a very strong wind, and if any spark had escaped from the fire in the engine it would have been blown away from the buildings which were destroyed by the fire. There was no spark arrester on the engine, but there was no evidence which could justify a conclusion that the fire was caused by a spark from the engine.

There was some evidence that fire-extinguishers were, or had been, somewhere on the premises, but that they could not be found on the occasion of the fire. There was evidence that there was no fire hydrant, available hose, or sprinkler system in the buildings.

The plaintiff called Mr. C. A. Milledge as an expert witness for the purpose of showing what precautions should have been taken against fire in a flour mill. The learned trial judge rejected his evidence on the ground that he was not qualified as an expert. Mr. Milledge was a District Officer in the New South Wales Fire Brigade organization. He had twenty-five years' experience in fire brigades. His duties consisted in making building inspections. He had inspected many flour mills and had acquainted himself with literature relating to fire risks attached to flour mills. He had had an extensive experience of many kinds of fires. The learned judge held that the witness was not qualified to give expert evidence and rejected his evidence.

Evidence was called for both plaintiff and defendant. The defendant applied for a direction to the jury to enter a verdict in its favour, and this application succeeded. The learned trial judge was of opinion that, as far as the claim based on strict liability was concerned, there was no evidence of non-natural use of the premises and that there was no evidence that any fire brought on to the land by the defendant had caused the conflagration which destroyed the plaintiff's property. The origin of the fire was entirely unexplained. With respect to the claims based on negligence, the learned judge rejected the argument that the mere occurrence of a fire on the defendant's premises placed the onus of establishing absence of negligence on the defendant. With respect to fire-fighting equipment and materials, his Honour was of opinion that there was no evidence of negligence in failure to provide such equipment and materials, but that, even if there were such evidence, it could not be said that the fire spread and developed by reason of any negligence of the defendant in failing to make such provision.

Upon appeal, the Full Court held that there was no evidence of non-natural user of the land, and that the claim based on strict liability failed. As to the claims based on negligence, it was held that the evidence of Mr. Milledge was wrongly rejected and that there was some evidence of negligence. An order was made for a new trial.

In my opinion the case of the plaintiff, in so far as it depends upon the contention that the defendant is subject to an absolute liability independent of negligence for the damage done by a fire originating upon its premises and spreading to the plaintiff's property, is answered by the decision of this Court in Hazelwood v. Webber[1]. In that case it was held that the law of New South Wales did not include the Fires Prevention (Metropolis) Act 1774, which re-enacted with some modifications 6 Anne, c. 58, and 12 Geo. III., c. 73. These statutes provided that the occupier of premises was not liable for the results of a fire which was kindled by accident, although he would be liable even in the case of an accidental fire if it were due to negligence (Filliter v. Phippard[2]). The Act of 1774 became part of the law of New South Wales by virtue of 9 Geo. IV., c. 83. The provisions of this Act were adopted by a New South Wales statute which therefore impliedly repealed the Act. The local statute was subsequently repealed. In Hazelwood v. Webber[3] the question arose whether the effect of the repeal was to restore the English statute or to leave the position as it was at common law. It was necessary for the Court to determine whether "the common law has been superseded by statute"[4]. The Court held that the 1774 Act was not in force in New South Wales, and that the common law had been restored.

The Court authoritatively stated the rule of the common law on the subject in the following terms: "The common law imposed upon the occupier of land, who used fire upon it, a prima-facie liability which was independent of negligence for the harm suffered by his neighbour as a natural consequence of the escape of the fire": See Hazelwood v. Webber[5]. To this prima-facie liability, however, there were certain exceptions, including cases "when the use of the element or thing which the law regards as a potential source of mischief is an accepted incident of some ordinary purpose to which the land is reasonably applied by the occupier"[6].

The evidence in the present case showed that the operation of a flour mill brings about accumulations of inflammable dust, but it would, in my opinion, be impossible to support a finding by a jury or a decision by a judge that the use of land for the purpose of manufacturing flour is a non-natural user of land: See Rickards v. Lothian[7]; Read v. J. Lyons & Co. Ltd.[8]. Upon this ground the case falls outside the principle of strict liability which is established by Hazelwood v. Webber[9]. But, further, the principle of strict liability as stated in that case is limited to the escape of fire "used" upon the premises by the defendant. There is, as already stated, no evidence that the fire which spread to the plaintiff's rolling stock originated from any fire brought upon the premises by the defendant or used on the premises by the defendant. Therefore, upon this ground also, the case does not fall within the category of strict liability.

The plaintiff's case must therefore depend upon negligence. The plaintiff was prevented from giving evidence as to the precautions which were reasonable for the prevention of the outbreak or spread of fire in a flour mill: See Beven on Negligence, 4th ed. (1928), vol. 1, p. 626, as to negligence in failing to provide appliances for extinguishing fire in premises used for manufacturing purposes. There was some evidence that the fire-fighting equipment was meagre and poor, but the plaintiff was not allowed to give evidence as to what the fire-fighting equipment should have been, because the witness called as an expert was held to be unqualified. In my opinion it was rightly held in the Full Court that the evidence of this witness was wrongly rejected. If a senior Fire Brigades officer of twenty-five years' standing, with long experience of fires, including fires in flour mills, specifically engaged in the inspection of buildings from the point of view of fire prevention and control, and equipped with a knowledge of the literature on the subject, is not qualified to give expert evidence upon the subject of what is proper equipment for fire prevention and control in flour mills, it is difficult to suggest that any witness at all could be qualified to give such evidence. I agree, therefore, with the Full Court that there should be a new trial, but only upon the counts with respect to negligence. The reasons for judgment of the Full Court show that there is no ground for a new trial in respect of the third count alleging strict liability.

I am therefore of opinion that the appeal should be dismissed, but that the order of the Full Court should be varied by directing that the new trial be limited to the first and second counts.

I agree that there should be a new trial on the first and second counts. It is clear that the evidence of Mr. Milledge was wrongly rejected. The evidence as to his qualifications shows that he was peritus in every relevant sense.

Appeal by leave of this Court from a judgment of the Supreme Court of New South Wales in Full Court allowing an appeal to it on the part of the Commissioner for Railways—the respondent here—and setting aside a verdict and judgment in favour of a company called Wise Bros. Pty. Ltd.—the appellant here—and directing a new trial of an action brought by the Commissioner for Railways against the company.

It appeared that the company was possessed of premises at Narrandera in New South Wales and there carried on the business of a flour miller and also made sheep fodder. The dust produced and accumulated in the process of flour milling has "a high degree of inflammability." "In the air with a small source of flame it is easily inflammable." On a very hot day in 1944, with an exceptionally strong wind blowing, a fire broke out on the premises whereon the flour mill was erected. It spread with great rapidity within the mill and on to the railways and premises of the Commissioner. The mill was destroyed and rolling stock and other property of the Commissioner was also destroyed or damaged. The Commissioner's claim was in respect of the damage sustained by him by reason of the destruction or damage to his property. The trial judge directed a verdict for the company and entered judgment accordingly but, as already appears, the Supreme Court directed a new trial.

This appeal from the judgment of the Supreme Court is more conveniently dealt with by consideration of the reasons advanced by the Commissioner in support of the judgment than those advanced by the company in opposition to it.

That the liability of the company for damage done by the spread of the fire from its premises was absolute and independent of negligence.

Count 3 of the declaration is relied upon as stating a cause of action founded upon this contention. It alleges that a fire, having started on the land of the company, escaped therefrom on to the property of the Commissioner, whereby his property was damaged. But this contention has always been open to doubt in English law and has been rejected by this Court in Bugge v. Brown[10]: and see Hazelwood v. Webber[11].

That "the person who, for his own purposes, brings on his land and collects and keeps there anything likely to do mischief if it escapes, must keep it in at his peril; and if he does not do so, is prima facie answerable for all the damage which is the natural consequence of its escape." This is the doctrine of Rylands v. Fletcher[12]. But "prerequisites of the doctrine are that there must be the escape of something from one man's close to another man's close and that that which escapes must have been brought upon the land from which it escapes in consequence of some non-natural use of that land" (Read v. J. Lyons & Co. Ltd.[13]).

Count 3 of the declaration is also relied upon as stating a cause of action founded upon this doctrine. On the evidence adduced, the cause of the fire is uncertain and conjectural. But it is clear that the use of the company's land for the purpose of a flour mill cannot, in modern times, be described as a non-natural use of the land (Rickards v. Lothian[14]; Hazelwood v. Webber[15]; Read v. J. Lyons & Co. Ltd.[16]). Such a use of the land was a reasonable enjoyment of the company's rights.

The third count cannot, therefore, find support in the doctrine of Rylands v. Fletcher[17].

Negligence.

The negligence, on the part of the company, relied upon is:—

(a)

the careless use of fire on its premises;

(b)

the accumulation of inflammable material on its premises and omitting to provide adequate means for preventing its ignition and the outbreak of fire;

(c)

the accumulation of inflammable material on its premises and omitting to provide proper fire-fighting equipment for the suppression and extinction of any fire that broke out upon the land.

This seems to be the substance of counts 1 and 2.

The company maintained a boiler on its premises and used a fire for raising steam for mill purposes. The smoke-stack had no spark arrester. But the boiler-house was some twenty feet from the nearest wall of the company's premises and the strong wind was against sparks blowing from the smoke-stack into the mill. It is mere conjecture on this evidence how the fire originated and there was no other evidence of the use of fire on the company's premises. Standing alone, these facts do not support the allegation of the careless use of fire by the company resulting in damage to the Commissioner. The proof of careless use of fire was upon the Commissioner.

But when the company collected or allowed highly-inflammable dust to collect on its premises, then it was under a duty towards its neighbours, of whom the Commissioner was one, to take such reasonable precautions as a prudent man would have exercised under such circumstances to prevent its ignition and the escape of fire from its premises and also to suppress and extinguish any fire that there occurred (Vaughan v. Menlove[18]; Job Edwards Ltd. v. Birmingham Navigations[19] the dissenting opinion of Scrutton L.J.; Sedleigh-Denfield v. O'Callaghan[20]; Donoghue v. Stevenson[21] per Lord Atkin).

There was evidence to go to the jury of a breach of this duty on the part of the company and material and admissible evidence in support of the breach appears to have been rejected.

Consequently the judgment of the Supreme Court directing a new trial is right so far as counts 1 and 2 are concerned but cannot be supported as to count 3.

The first and second counts of the declaration in this action allege that the fire which destroyed the plaintiff's property was caused by the defendant's negligence. The second count also contains an allegation of non-natural user of land. But in that count the defendant is not sued upon any cause of action other than negligence. The first count alleges negligence causing the fire to break out on the defendant's land and to spread to the plaintiff's property. The second count alleges negligence in not having proper equipment to extinguish the fire and in not extinguishing it. The basis of these counts seems to be that by using the land in the way alleged, the defendant created a grave risk of fire and that in the circumstances he had a duty proportioned to the risk to take care to prevent a fire breaking out and, if it did so, to put it out before it ignited the combustible waste lying about the premises.

There was ample evidence from which the jury could find that a fire broke out on the defendant's premises and, after burning for a while, extended into the mass of combustible dust and fumes about the premises and caused the conflagration which extended to the plaintiff's property. But there was no evidence from which the jury could find how the fire originated. The factory chimney had no spark arrester, but it would be mere conjecture, having regard to the established facts governing the probabilities, to attribute the origin of the fire to a spark which flew out of the chimney and lodged at a spot where fire was first seen on the defendant's premises. It was not suggested that the origin of the conflagration was a fire kindled by any person for whose act the defendant is responsible. The allegation in the first count is that the fire broke out in consequence of the negligent conduct by the defendant of its business and the accumulation of combustible dust and fumes. The evidence in my opinion fails to establish a causal connection between the fire and the defendant's operations on the land.

The issue which is raised by the second count is whether the defendant was negligent in and about providing fire-fighting equipment to deal with an outbreak of fire and in not taking proper action to extinguish the fire at its initial stage. The trial of this issue of negligence was unsatisfactory because of the rejection of Mr. Milledge as an expert witness. I agree that his evidence of his qualifications conclusively proved that he had sufficient skill and experience to enable him to express an opinion which would assist the jury to form a correct judgment on this issue. As to the principle by which the jury should be guided, it is useful to refer to the direction of Cockburn C.J. to the jury in Blenkiron v. Great Central Gas Consumers Co.[22]: "And those who carry on operations dangerous to the public are bound to use all reasonable precautions—all the precautions which ordinary reason and experience might suggest to prevent the danger. It is not enough that they do what is usual if the course ordinarily pursued is imprudent and careless; for no one can claim to be excused for want of care because others are as careless as himself; on the other hand, in considering what is reasonable, it is important to consider what is usually done by persons acting in a similar business." (See Cox Bros. (Australia) Ltd. v. Commissioner of Waterworks[23]).

The third count of the declaration alleges a non-natural user by the defendant of his land as a ground of a liability which is independent of negligence. It is necessary to sustain that allegation in order to make the defendant absolutely liable for the damage caused by the fire, as this count seeks to do (Hazelwood v. Webber[24]). The use by the defendant of this land for these industrial operations, which have been described, could not reasonably be held to be a non-natural user of the land: Read v. J. Lyons & Co. Ltd.[25].

For these reasons I think that there should be an order for a new trial limited to the second count, and that the order of the Full Court should be varied accordingly. Subject to this variation, I should dismiss the appeal.

The nature of the pleadings has already been explained, and the evidence given on the first trial analysed and discussed in the judgment of the learned Chief Justice of the Supreme Court of New South Wales, and I shall not attempt to cover the same ground. The appellant, the defendant in the action, is the owner of certain land at Narrandera adjoining a railway siding owned by the plaintiff on which the defendant carries on in one building the business of a flour miller, and in an adjoining building the business of a manufacturer of sheep nuts.

On 13th October 1944, a fire originated on the defendant's premises and spread to the railway siding where it destroyed some of the plaintiff's rolling stock. The only fire which the defendant had lit on its premises on that day was the usual fire in the fire box of a portable boiler used to generate steam to cook the sheep nuts. The defendant was using electric power in its flour mill, and there is evidence that a highly combustible dust is produced in the manufacture of flour which is easily ignited by static electricity. This dust is the material referred to in the declaration as an accumulation of large quantities of highly combustible fumes, waste and other material. The declaration contains three counts, of which the first two claim that the damage to the plaintiff's property is due to the negligence of the defendant, and the third that the defendant is liable for such damage without negligence.

Whatever room there may previously have been for differences of opinion, I think that it is now clear from the speeches of the House of Lords in the recent case of Read v. J. Lyons & Co. Ltd.[26] that under the modern law of tort an occupier of land is not liable for damage caused by the escape of fire used on his land on to that of his neighbour, unless it was not a natural use of the land. This was the view of the law expressed by this Court in Hazelwood v. Webber[27]. It is stated in the joint judgment of Gavan Duffy C.J., Rich J., Dixon J., and McTiernan J. that—"When the use of the element or thing which the law regards as a potential source of mischief is an accepted incident of some ordinary purpose to which the land is reasonably applied by the occupier, the prima facie rule of absolute responsibility for the consequences of its escape must give way"[28]. This statement is entirely consistent with that of Lord Macmillan in Read's Case[29] where his Lordship said in reference to the doctrine in Rylands v. Fletcher[30] that: "The two prerequisities of the doctrine are that there must be the escape of something from one man's close to another man's close and that that which escapes must have been brought upon the land from which it escapes in consequence of some non-natural use of that land, whatever precisely that may mean"[31]. It could not be said that the use by the defendant of its land at Narrandera as a factory and, as incidental thereto, the use of a boiler heated by fire to generate steam required for one of its manufacturing processes, was an unnatural use of the land under modern conditions. As Lord Uthwatt said in Read's Case[32], "natural does not mean primitive." I agree therefore with the learned judges of the Supreme Court that the action is one in which the plaintiff can only succeed if he can prove that the damage to his rolling stock was caused by the negligence of the defendant.

There is evidence which, read most favourably to the defendant, shows that the only precaution taken by the defendant to combat an outbreak of fire on its premises consisted of about a dozen chemical fire-extinguishers of the bottle type. There was no sprinkler system and no fire hydrant. The plaintiff sought to call a district officer of the New South Wales Fire Brigade with twenty-five years' experience, who had inspected many flour mills, had been present at fires in flour mills, and had read standard publications on the subject, to give expert evidence of what precautions are necessary for the prevention of fires in such mills. He was asked his opinion as to what should be done in regard to fire appliances in flour mills. But his evidence was rejected by the learned trial judge on the ground that he was not qualified to express an expert opinion on this subject. I agree with the opinion of the learned judges of the Supreme Court that this evidence should have been admitted. The witness was at least qualified to give evidence of the appliances to fight fires which it was usual to install in flour mills, and this would be evidence of the precautions which it would be reasonable for a flour miller to take to prevent damage by fire to his neighbours. Mr. Taylor, as I understood his argument, did not seriously contend that this evidence was not admissible. His real contention was that there was no causal connection between the absence of such appliances and the spread of the fire because the day was so hot and the wind so strong that no appliances could have saved the situation. Possibly this is right, but it is not a contention which can be fully examined in the absence of all the material evidence.

There is evidence that the smoke-stack of the boiler did not have a spark arrester, but there is no evidence that I can discover from which a jury could reasonably infer that a spark from the boiler originated the fire. But there is some evidence from which a jury could reasonably infer that the fire was started by the flour dust becoming accidentally ignited, and the real case against the defendant is that there was such a risk of this happening in the ordinary course of flour-milling operations, that the defendant was under a duty to take proper precautions to prevent a fire which originated on its premises in this manner escaping and doing damage to the property of its neighbours. It is on this issue that the evidence that was rejected would be material, and in its absence I do not think that it would be right to refuse a new trial on the ground that the weather conditions were such that no jury could reasonably be satisfied that the damage to the plaintiff's rolling stock was caused by the failure of the defendant to take proper precautions to guard against the risk of fire.

I am therefore of opinion that there should be a new trial limited to the question whether the damage done to the plaintiff's property was caused by the negligence of the defendant.

For these reasons I would dismiss the appeal, but vary the order appealed from by directing that the new trial should be limited to the first and second counts.

Rule of Supreme Court varied by directing that the new trial be limited to the first and second counts in the declaration. Otherwise rule affirmed and appeal dismissed with costs.

[1] [1934] HCA 62; (1934) 52 C.L.R. 268.

[2] [1847] EngR 999; (1847) 11 Q.B. 347 [116 E.R. 506].

[3] [1934] HCA 62; (1934) 52 C.L.R. 268.

[4] (1934) 52 C.L.R., at p. 275.

[5] (1934) 52 C.L.R., at pp. 274, 275, 280.

[6] (1934) 52 C.L.R., at p. 277.

[7] [1913] UKPC 1; (1913) A.C. 263, at p. 280.

[8] [1946] UKHL 2; (1947) A.C. 156.

[9] [1934] HCA 62; (1934) 52 C.L.R. 268.

[10] [1919] HCA 5; (1919) 26 C.L.R. 110, at p. 115.

[11] [1934] HCA 62; (1934) 52 C.L.R. 268.

[12] [1868] UKHL 1; (1866) L.R. 1 Ex. 265; (1868) L.R. 3 H.L. 330, at pp. 340, 341.

[13] [1946] UKHL 2; (1947) A.C. 156, at pp. 173-174.

[14] [1913] UKPC 1; (1913) A.C. 263.

[15] (1934) 52 C.L.R., at p. 281.

[16] [1946] UKHL 2; (1947) A.C. 156.

[17] [1868] UKHL 1; (1866) L.R. 1 Ex. 265; (1868) L.R. 3 H.L. 330.

[18] [1837] EngR 424; (1837) 3 Bing. (N.C.) 468 [132 E.R. 490.]

[19] (1924) 1 K.B. 341, at p. 361.

[20] [1940] UKHL 2; (1940) A.C. 880.

[21] (1932) A.C. 562, at pp. 580-581.

[22] [1860] EngR 17; (1860) 2 F. & F. 437, at p. 440 [1860] EngR 17; [175 E.R. 1131, at pp. 1132, 1133].

[23] [1933] HCA 50; (1933) 50 C.L.R. 108.

[24] [1934] HCA 62; (1934) 52 C.L.R. 268, at pp. 277-279.

[25] [1946] UKHL 2; (1947) A.C. 156.

[26] [1946] UKHL 2; (1947) A.C. 156.

[27] [1934] HCA 62; (1934) 52 C.L.R. 268.

[28] (1934) 52 C.L.R., at p. 277.

[29] [1946] UKHL 2; (1947) A.C. 156.

[30] [1868] UKHL 1; (1868) L.R. 3 H.L. 330.

[31] (1947) A.C., at pp. 173, 174.

[32] (1947) A.C., at p. 187.

High Court of Australia

Wise Bros Pty Ltd v Commissioner for Railways (NSW) [1947] HCA 33; (1947) 75 CLR 59 (17 September 1947)

HIGH COURT OF AUSTRALIA