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High Court of Australia |
OCEANIC CREST SHIPPING Co. v. PILBARA HARBOUR SERVICES PTY. LTD. [1986] HCA 34; (1986) 160
CLR 626
F.C. 86/033
Shipping and Navigation - Negligence
High Court of Australia
Gibbs C.J.(1), Wilson(2), Brennan(3), Deane(4) and Dawson(5) JJ
CATCHWORDS
Shipping and Navigation - Negligence - Damage to wharf - Negligence of pilot - Pilotage compulsory - Pilot appointed under statute and employed by port authority - Liability of authority for pilot's negligence - Whether liability excluded by statute - Implied exclusion - Shipping and Pilotage Act 1967 (W.A.), ss. 4, 9(2)(a) - Navigation Act 1912 (Cth), s. 410B(2).Negligence - Master and servant - Vicarious liability - Damage caused to wharf by negligence of pilot - Pilot appointed under statute and employed by port authority - Liability of authority for pilot's negligence - Whether liability excluded by statute - Implied exclusion - Pilot public officer exercising independent duty - Navigation Act 1912 (Cth), s. 410B(2).
HEARING
Perth, 1985, October 14, 15;DECISION
GIBBS C.J.: The appellant, Oceanic Crest Shipping Company ("Oceanic"), is the owner of a ship which on 8 August 1978, while berthing in the Port of Dampier in Western Australia, struck with considerable force a dolphin - a structure consisting of a number of steel piles capped with a steel platform and faced with a fender system, designed to protect a wharf - and damaged it. The dolphin was the property of Hamersley Iron Pty. Ltd. ("Hamersley") which had constructed the harbour and wharf facilities. The damage was caused by the negligence of the pilot, Captain Hammonds, who had been provided to the ship by the respondent, Pilbara Harbour Services Pty. Ltd. ("Pilbara"), a company which had, under statutory authority, the entire control of all port services (including pilotage), facilities and installations in the Port of Dampier. It is a curious, but irrelevant, feature of the case that the right of control and the obligation to provide pilotage services were originally those of Hamersley (see cl.10(2)(f) of the agreement made on 30 July 1963 and cl.12 of the supplementary agreement made on 27 October 1964 approved under the Iron Ore (Hamersley Range) Agreement Act 1963 (W.A.), as amended, and cll.3(15), 29(1) and 78 of the Hamersley Iron (Port of Dampier) By-laws made under that Act) but were assigned to Pilbara, a company associated with Hamersley, under the power given by cl.20 of the agreement of 30 July 1963, by an agreement, made on 30 September 1974. By cl.3(1) of the last-mentioned agreement, it was provided that Pilbara should:(iii) Shipping and Pilotage Act 1967 and its
Regulations
..."By cl.7 of that agreement Pilbara was entitled to make and collect charges for pilotage. Under the law of Western Australia, pilotage for vessels entering or leaving the Port of Dampier was (with certain irrelevant exceptions) compulsory: Shipping and Pilotage Act 1967 (W.A.), as amended ("the Act"), s.9(2)(a); Port of Dampier Regulations, reg.7. Pilots in Western Australia are appointed by the Governor (s.4 of Shipping and Pilotage Act) but the State had agreed by a letter dated 27 September 1974 that pilots for the Port of Dampier would be appointed and removed under that Act in accordance with requests made by Pilbara (but Pilbara might only request the appointment of persons adequately qualified for that purpose) and that so long as Pilbara provided the pilotage services it would have the benefit of the pilotage charges levied under the Act (see s.9(1)) and regulations (reg.13) for the services of pilots who were also employees of the company. Captain Hammonds was engaged as an employee of Pilbara at an annual salary and was subsequently appointed by the Governor to be a pilot for the Port of Dampier.
2. Hamersley brought proceedings against Pilbara and Oceanic to recover damages and in the action there were proceedings for contribution or indemnity between the two defendants. The result of the proceedings, after an appeal had been brought to the Full Court of the Supreme Court of Western Australia, was that judgment was given in favour of Hamersley as against Oceanic for $625,362.36 and that Hamersley's claim as against Pilbara, and all claims brought in the contribution proceedings, were dismissed. Oceanic now appeals, seeking judgment against Pilbara for contribution or for a complete indemnity.
3. Oceanic's argument is put in two ways. First, it is said that Pilbara
owed Oceanic a duty to provide a pilotage service which
would be carried out
with reasonable care and skill by a competent pilot and that Oceanic was
entitled to claim damages for economic
loss (the damages potentially payable
to Hamersley) caused by a breach of that duty. Alternatively, Oceanic's claim
is based on s.7(1)(c)
of the Law Reform (Contributory Negligence and
Tortfeasors' Contribution) Act 1947 (W.A.), a familar provision whose
material terms
are as follows:
"Where damage is suffered by any person as the
result of a tort -
...
(c) any tortfeasor liable in respect of that
damage may recover contribution from any other
tortfeasor who is or would if sued have been
liable in respect of the same damage
..."That argument is that Pilbara is liable to Hamersley for the damage caused to the dolphin, and that Oceanic, a tortfeasor also liable, can recover contribution. (In fact, of course, Pilbara was sued by Hamersley and found not to be liable, but that difficulty may be put aside for the present.) Oceanic cannot succeed in either argument unless Pilbara is vicariously liable for the negligence of the pilot whom it supplied. On ordinary principles Pilbara would be liable for damage caused by the negligent acts and omissions of its servants acting within the scope of their employment. However it is a question whether these principles do apply so as to render the government or other body which employs a pilot liable for the pilot's negligence in the piloting of a ship. No doubt Pilbara, having control of the harbour and in effect a monopoly of the right to supply the pilots whose use in the port was required by law, was under a duty to supply pilots qualified and fit to perform their functions, but no breach of that duty is suggested. Pilbara clearly was not an insurer of the safety of vessels being piloted by its servants. The critical question is whether Pilbara is liable for the negligence of Captain Hammonds committed while he was performing his functions as pilot of a ship.
4. The learned trial judge (Wallace J.) and the majority of the Full Court
(Burt C.J. and Smith J.) held that the authority of the
decision of the
Judicial Committee in Fowles v. Eastern and Australian Steamship Company,
Limited (1916) 2 AC 556, required that
question to be answered in the
negative. Brinsden J., who dissented in the Full Court, held that that case
was distinguishable.
In Fowles v. Eastern and Australian Steamship Company,
Limited a ship under compulsory pilotage in the port of Brisbane had been
stranded by the negligence of the pilot. The action was brought by the
shipowners against the nominal defendant representing the
government. The
pilot was licensed by the Marine Board, a government department, and was
employed as a public servant receiving
a salary and was provided by the
government with boats and crew; the pilotage rates were paid to the
government. It had been held
by the Full Court of the Supreme Court of
Queensland that the action was maintainable against the government (see (1913)
St.R.Qd.
64). An appeal to this Court from the decision of the Supreme Court
was allowed, but, for reasons which it is unnecessary to mention,
only three
members of this Court determined the question whether the government was
liable; Barton A.C.J. and Powers J. held that
it was and Isaacs J. held that
it was not (see 17 C.L.R. 149). The Judicial Committee agreed with Isaacs J.
and
held that the action
was not maintainable. Earl Loreburn, who delivered
the
judgment of their Lordships, said, at p.560, that the
true question was
"whether
or not the Government had laid upon them the conduct
and management
of this ship" and that "if so, then
they were bound to use proper
care and
skill and are liable for failure to do
so". Their Lordships answered that
question in the
negative. The reason for the
decision was expressed in the
following words of
Earl Loreburn, at pp.562-563:
"... if the question be, as their Lordships think
it is, whether or not the defendants were bound to
navigate this ship and employed Maxwell (the pilot)
to do for them the work which they were bound to
do, then it is not conclusive to say that he was in
their service unless it can also be said that the
Government were 'the principals in the piloting of
ships,' to borrow the happy phrase of Isaacs J.
That phrase seems to hit the point exactly. If
Maxwell himself was the principal in the piloting
of ships, then the defendants cannot be liable. It
was he and not they who owed the duty of careful
piloting to the plaintiffs.
In their Lordships' opinion these Acts of
Parliament did not alter the original status of a
pilot, which is, in effect, that he must be
regarded as an independent professional man in
discharging his skilled duties. If it had been
intended to alter this old and familiar status, it
is to be supposed that the Legislature would have
done it more explicitly. What it has done is more
consistent with a different and limited purpose,
namely, to secure a proper selection, a proper
supply, a proper supervision, and a proper
remuneration of men to whose skill life and
property is committed, whether the shipowner likes
it or not. For this purpose they become servants
of the Government. For the purpose of navigating
ships they remain what they were, and the duty
which the State or Government owes to a shipowner,
exercised, it is true, by various authorities, is
to provide a qualified man in the terms of the
statutes, but not to take the conduct or management
of the ship."
5. The decision of the Judicial Committee was in line with earlier authority.
There could, of course, be no doubt that the mere
fact that a harbour
authority licensed the pilot does not make it responsible for his negligence:
Dudman v. Dublin Port and Docks
Board (1873) Ir.R. 7 C.L. 518; Shaw, Savill
and Albion Company v. Timaru Harbour Board (1890) 15 App.Cas. 429. In Holman
v. Irvine
Harbour Trustees (1877) 4 Sess.Cas. (4th Ser.) 406, the Court of
Session held that Harbour Trustees were liable for the negligence
of
unlicensed pilots whom they employed, but made it clear that the position
would have been different if the pilot had been licensed.
Lord Ormidale said,
at p.416:
"A duly qualified or licensed pilot is a publicSee also per Lord Moncreiff, at p.422. In Otago Harbour Board v. Cates (1884) 2 NZLR 123 and Actieselskabet Bannockburn v. Williams (1912) 12 SR(NSW) 665 it was held that the employer of a licensed pilot was not liable for his negligence. In the last-mentioned case, Cullen C.J. said, at p.670, that the pilot, in taking charge of the navigation of a ship, was "exercising a duty which no employer could control by directions given during the course of the carrying out of his work".
officer who obtains his certificate only after a
careful examination of his qualifications by
parties competent to judge of them. On being
licensed he occupies an independent position, very
much as a notary-public or messenger-at-arms does.
The public constitute his master, and he is the
servant of the public, like these and other public
functionaries; and the usual consequences and
responsibilities arising from the ordinary relation
of master and servant do not arise."
6. The decision in Fowles v. Eastern and Australian Steamship Company, Limited has since been understood in this Court as depending on the circumstance that the pilot was executing an independent duty which the law cast upon him: Field v. Nott [1939] HCA 41; (1939) 62 CLR 660, at pp 672, 675; Little v. The Commonwealth [1947] HCA 24; (1947) 75 CLR 94, at p 114; cf. Attorney-General for N.S.W. v. Perpetual Trustee Co. (Ltd.) [1952] HCA 2; (1952) 85 CLR 237, at pp 265, 300-301. In Little v. The Commonwealth, at p 114, Dixon J. (as he then was) cited Fowles v. Eastern and Australian Steamship Company, Limited as one of the authorities which establishes or exemplifies "the doctrine that any public officer whom the law charges with a discretion and responsibility in the execution of an independent legal duty is alone responsible for tortious acts which he may commit in the course of his office and that for such acts the government or body which he serves or which appointed him incurs no vicarious liability". The doctrine to which Sir Owen Dixon referred in that passage was first laid down in Australia in Enever v. The King [1906] HCA 3; (1906) 3 CLR 969, which followed Tobin v. The Queen [1864] EngR 21; (1864) 16 CB(N.S.) 310 (143 ER 1148) and Stanbury v. Exeter Corporation (1905) 2 KB 838. It has been criticized by textwriters (see Fleming, The Law of Torts, 6th ed. (1983), at p.346 and Atiyah, Vicarious Liability in the Law of Torts (1967), at pp.75-78), and has been abrogated by statute in some jurisdictions. However, it is firmly established as part of the common law of Australia: other cases in which it has been applied include Baume v. The Commonwealth [1906] HCA 92; (1906) 4 CLR 97 and Irvin v. Whitrod (No. 2) (1978) Qd.R. 271.
7. The principle is not limited to cases in which the duty which is being carried out is imposed by statute - the question is whether the person who committed the tort was acting in the performance (or supposed performance) of a duty imposed by law (either by statute or by common law) or whether his authority to act was derived from his employment. Further, although many of the decisions in which the principle has been applied were cases in which the Crown was sought to be made liable for the tort of a public officer, the principle is not confined to such cases. Stanbury v. Exeter Corporation was a case in which a local authority was held not to be liable for the negligence of an inspector whom it had appointed, where the inspector was negligent in carrying out a duty imposed by statute upon him and not on the local authority. That decision was followed, not only in Enever v. The King (see particularly at pp 976, 986-987, 992-993) but also in Fisher v. Oldham Corporation (1930) 2 KB 364, and both Stanbury v. Exeter Corporation and Fisher v. Oldham Corporation were mentioned with apparent approval in the judgment of the Judicial Committee in Attorney-General for N.S.W. v. Perpetual Trustee Co. (Ltd.) (1955) AC 457, at pp 478-480; see also Reg. v. Commissioner of Police of the Metropolis, Ex parte Blackburn (1968) 2 QB 118, at p 136. There are three cases which might possibly be thought to support a contrary conclusion; in Goff v. Great Northern Railway Co. [1861] EngR 316; (1861) 3 El. & El. 672 (121 ER 594), Edwards v. Midland Railway Co. (1880) 6 QBD 287 and Lambert v. Great Eastern Railway (1909) 2 KB 776 it was held that employers of special constables under private statutes were vicariously liable for wrongful arrests which they had effected, but those cases were discussed in Fisher v. Oldham Corporation, at pp 373-374, and the view was there taken that they depended on the effect of particular statutes. The fact that in the decisions of this Court to which reference has been made Fowles v. Eastern and Australian Steamship Company, Limited is regarded as falling within the principle plainly shows that this Court was of the view that the doctrine is not confined to the Crown.
8. It was submitted before us that Fowles v. Eastern and Australian Steamship Company, Limited depended on a view of the principles of vicarious liability that is no longer accepted, namely, the view that if the work to be done involves the exercise of special skill or independent judgment, so that the employer cannot control or interfere in the manner of its performance, the employer will not be vicariously liable to third parties for the acts of the persons performing the work: see Zuijs v. Wirth Brothers Pty. Ltd. [1955] HCA 73; (1955) 93 CLR 561, at pp 570-571. It was there said, at p 571, that "what matters is lawful authority to command so far as there is scope for it ... if only in incidental or collateral matters". In England the courts have applied "a new test ... which involves the question whether or not a man's work is done as an integral part of another's business or is only accessory to it; whether, to put it in slightly different terms, the person in question is performing the relevant services as a person in business on his own account": Federal Commissioner of Taxation v. Barrett (1973) 129 CLR 395, at p 402. It is however not right to say that this test, which involves difficulties of its own, has been accepted as the decisive test in Australia or that the degree of control which the employer can exercise is irrelevant in considering whether the relationship of master and servant exists: see Stevens v. Brodribb Sawmilling Co. Pty. Ltd. [1986] HCA 1; (1986) 60 ALJR 194, at pp 196-198, 201-202; [1986] HCA 1; 63 ALR 513, at pp 517-521, 525-527.
9. With all respect to those who are of a different opinion, the decision of
the Judicial Committee in Fowles v. Eastern and Australian
Steamship Company,
Limited does not conflict with modern principles. The doctrine laid down in
the cases which followed Stanbury
v. Exeter Corporation and Enever v. The
King does not exempt the employer from liability on the ground that the
relationship of
master and servant does not exist. Even though the person who
committed the tort was employed under a contract of service, the employer
will
not be liable if the tortfeasor was executing an independent duty which the
law cast upon him. This was made clear by Dixon
J. in Field v. Nott, where
his Honour said, at p 675:
"When a public officer, although a servant of theSimilarly, in Attorney-General for N.S.W. v. Perpetual Trustee Co. (Ltd.), Fullagar J. said, at pp 283-284:
Crown, is executing an independent duty which the
law casts upon him, the Crown is not liable for the
wrongful acts he may commit in the course of his
execution. As the law charges him with a
discretion and responsibility which rests upon him
in virtue of his office or of some designation
under the law, he alone is liable for any breach of
duty."
"The distinction taken in those cases seems to beThese passages refer to the Crown, but as I have said the doctrine is not confined to the Crown. The passage which I have already cited from Fowles v. Eastern and Australian Steamship Company, Limited, at p 562, shows that their Lordships did not regard the question as being whether the relation of master and servant existed, but rather whether the pilot was performing an independent duty.
in substance between an act or default of an
officer in the course of his service under the
Crown on the one hand, and an act or default in
executing some independent duty cast upon him by
the common law or by statute on the other hand.
The distinction itself has been criticized ... But,
whether the distinction has been soundly applied or
not, it has turned, as it seems to me, not on the
presence or absence of the relation of master and
servant as such (though it may, of course, be
loosely said that the servant is not a servant
quoad hoc) but on the question whether the servant
is acting in the course of his employment by the
Crown."
10. It may well be true that in some of the earlier cases in which the employer of a pilot has escaped liability the question was thought to be whether the employer had the power and responsibility to control the pilot's conduct: see, for example, the remarks of Cullen C.J. in Actieselskabet Bannockburn v. Williams already cited. In the United States that seems to be the approach: see Port of Seattle v. M/V Maria Rubicon (1975) 404 F.Sup. 302 and City of Los Angeles v. Standard Transport Co. (1929) 32 F (2d) 988 but compare the decision in The Thielbek (1917) 241 F 209. Even if the question were whether the pilot was acting as a servant of the authority which employed him, it would not be wrong to regard the extent of the control exercised by the employer as important. However Fowles v. Eastern and Australian Steamship Company, Limited approached the matter in a different way and was consistent with established principle in so doing.
11. The common law treated the liability of the employer of a pilot differently from the liability of the shipowner. It was held at common law that the shipowner was liable for the negligence of a pilot who had been voluntarily engaged (see The "Eden" [1846] EngR 392; (1846) 2 W.Rob. 442 (166 E.R. 822)). On the other hand, if the pilotage was compulsory, the owner was not responsible - that was the common law, later given effect in a succession of statutory enactments of which the latest was s.633 of the Merchant Shipping Act 1894 (U.K.). The reason given for this distinction was that when the pilot was voluntarily engaged he became the servant of the shipowner, but when his employment was compulsory he did not become the owner's servant: see The "Maria" (1839) 1 W.Rob. 93, at pp.99-103, 106, 107-108 [1839] EngR 1025; (166 E.R. 508, at pp.510-512, 513); The "Halley" (1868) L.R. 2 P.C. 193, at p.202; Townsville Harbour Board v. Scottish Shire Line Ltd. [1914] HCA 33; (1914) 18 CLR 306, at pp 326-327; Steamship "Beechgrove" Company, Limited v. Aktieselskabet "Fjord" of Kristiania (1916) 1 AC 364, at pp 382-385; Thom v. Owners of S.S. "Smerdis" (1925) Scot.LT 239, at p 241.
12. The freedom of the shipowner from liability for the negligence of a
compulsory pilot was removed in the United Kingdom by s.15(1)
of the Pilotage
Act 1913 (U.K.), the provisions of which have been enacted in Australia in
s.410B(2) of the Navigation Act 1912 (Cth), as amended. Section 410B provides
as follows:
"(1) A pilot who has the conduct of a ship is
subject to the authority of the master of the
ship and the master is not relieved from
responsibility for the conduct and navigation
of the ship by reason only of the ship being
under pilotage.
(2) Notwithstanding anything contained in a law ofSub-section (2) has the effect that "a shipowner who through a compulsory pilot is responsible for faulty navigation is responsible for damage to his own ship as well as for injury to the property of another": Workington Harbour & Dock Board v. Towerfield (Owners) (1951) AC 112, at p 134. This provision, which was not in force at the time of the stranding which gave rise to Fowles v. Eastern and Australian Steamship Company, Limited, provides an additional reason for concluding that, in the case of compulsory pilotage, the employer of a pilot is not responsible for his negligence. "The law does not recognise a several liability in two principals who are unconnected": Laugher v. Pointer [1826] EngR 355; (1826) 5 B & C 547, at p 558 [1826] EngR 355; (108 ER 204, at p 208). This is another rule which is criticized by Professor Atiyah (op. cit., at pp 156-157) who nevertheless appears to accept that the question is settled, although he points out that one employer may be held vicariously liable while another is liable on another ground. Where the services of the servant of one employer are temporarily used by another, both employers will not be liable; prima facie the liability will usually remain with the general employer who may, however, "show, if he can, that he has for a particular purpose or on a particular occasion temporarily transferred the services of one of his general servants to another party so as to constitute him pro hac vice the servant of that other party with consequent liability for his negligent acts": Mersey Docks and Harbour Board v. Coggins and Griffith (Liverpool), Ltd. [1946] UKHL 1; (1947) AC 1, at p 13. In the case of a pilot, s.410B(2) of the Navigation Act casts the liability directly on to the shipowner and in consequence excludes any liability of the general employer of the pilot.
the Commonwealth or of a State or Territory,
the owner or master of a ship navigating under
circumstances in which pilotage is compulsory
under a law of a State or Territory is
answerable for any loss or damage caused by
the ship, or by a fault of the navigation of
the ship, in the same manner as he would if
pilotage were not compulsory."
13. It might be thought at first sight that it is difficult to reconcile the fact that the shipowner is liable for the negligence of the pilot with the proposition that the pilot while navigating the ship is executing an independent duty that the law casts upon him. It may be that originally liability was imposed on the shipowner for reasons of policy, so that a person injured by the negligence might have recourse against a defendant more likely to be able to meet an award of damages than the individual pilot himself would be. However, a reconciliation of the two propositions may be effected; so far as the pilot's general employer is concerned, the pilot is executing an independent legal duty conferred on him by law and his powers are not derived from the general employer; on the other hand, it may be said that the pilot's power does derive at least in part from the authority given by the shipowner - in that regard it will be remembered that the master has, though only in exceptional circumstances, power to take control of navigation out of the hands of the pilot (see cases cited in Geen & Douglas, The Law of Pilotage, 2nd ed. (1983), at pp.89-90), a power confirmed by sub-section (1) of s.410B. Even if the liability of the shipowner is anomalous, there is nothing in the judgments of the cases that dealt with the liability of the shipowner that casts any doubt on the principle applied in Fowles v. Eastern and Australian Steamship Company, Limited.
14. It may be that if some of the questions which I have been discussing now arose for decision for the first time it might have been thought convenient to cast responsibility for the negligence of the pilot on to the pilot's employer. As I have shown, however, the law has taken a different course. The decision of the Judicial Committee in Fowles v. Eastern and Australian Steamship Company, Limited rests on an intelligible principle and is not in conflict with fundamental doctrine. It has been cited with approval in a number of authoritative decisions. It appears to derive additional support from the provisions of s.410B of the Navigation Act. It is likely that the employers of pilots have ordered their affairs in reliance on its correctness. It should in my opinion be followed. It cannot be distinguished from the present case. The result in my opinion is that Pilbara is not liable to Oceanic for the negligence of the pilot.
15. I would dismiss the appeal.
WILSON J.: I have had the advantage of reading the reasons for judgment prepared by Brennan J. I agree with his Honour that the sole issue which is open to be considered in this appeal is whether the appellant ("Oceanic") should succeed in its claim against the respondent ("Pilbara") for contribution amounting to a complete indemnity in respect of the damage for which it has been found liable to Hamersley Iron Pty. Ltd. ("Hamersley"). The claim is based upon the provisions of s. 7(1)(c) of the Law Reform (Contributory Negligence and Tortfeasors' Contribution) Act 1947 (W.A.) ("the Act"). It is common ground that in order to succeed under those provisions Oceanic must show that Pilbara is a tortfeasor "who is or would if sued have been liable" to Hamersley "in respect of the same damage whether as a joint tortfeasor or otherwise". The facts which give rise to the litigation and the history of the case are narrated in the judgment of Brennan J. and it is unnecessary for me to repeat those matters at any length. Hamersley suffered loss when one of its dolphins in the port of Dampier was severely damaged by Oceanic's vessel the "Oceanic Crest" during its berthing in the port. It is not now contested that the mishap was due to the negligence of Captain Hammonds, a pilot in the employ of Pilbara and who had the conduct of the ship at the material time. Hamersley sued both Pilbara and Oceanic in the Supreme Court of Western Australia. It succeeded against Oceanic but its claim against Pilbara was dismissed. In the Full Court a finding of negligence against the master of the ship was set aside but otherwise the conclusions of the learned trial judge were affirmed. The Court was unanimous in acquitting the master of negligence and in holding Oceanic liable to Hamersley but resolved by majority (Burt C.J. and Smith J., Brinsden J. dissenting) that Pilbara was not vicariously liable to Hamersley for Hammonds' negligence. Hamersley has not appealed from the decision of the Full Court but I agree with Brennan J. that the judgment of dismissal of its claim against Pilbara is not an insuperable obstacle to Oceanic's pursuit of its claim against Pilbara. If it can show that Pilbara should have been found liable to Hamersley then the course proposed by his Honour would enable justice to be done.
2. Oceanic does not now contest that it must bear responsibility for the
negligence of Captain Hammonds. But it may be of critical
importance to
appreciate the basis on which that responsibility rests. The common law of
Admiralty always drew a clear distinction
between the liability of a shipowner
in respect of the negligence of a pilot under a voluntary engagement and the
situation where
the engagement of a pilot was compelled by law. In The
"Maria" [1839] EngR 1025; (1839) 1 W.Rob. 95; (166 E.R. 508), Dr Lushington described at p.
99
of 1 W.Rob.; (p. 510 of E.R.), the "leading principle" in the
case of
compulsory pilotage as this:
"that the masters are compellable to take suchSuch a situation was contrasted with the case:
pilots on board, and the owners are not responsible
for the acts of persons to whom they are thus
forced to commit the management of their property,
and over whom they have no control".
"when it is in the election or discretion of theThis perspective is emphasized by the statement of principle by Lord Atkinson in Steamship "Beechgrove" Company, Limited v. Aktieselskabet "Fjord" of Kristiania (1916) 1 AC 364 at pp 382-383, in the following passages:
master to take a pilot or not, and he thinks fit to
take one, the pilot so taken is to be considered as
a servant of the owners": p. 103 of 1 W.Rob.
(pp. 511-512 of E.R.).
"As long as the statutory compulsion operates theIt is plain that the shipowner is liable for the negligence of a pilot voluntarily engaged because the relationship thus established is considered to be that of master and servant. This principle of the common law was considered in depth in a test case before the First Division of the Court of Session in 1925. The case was Thom v. Owners of S.S. "Smerdis" (1925) SLT 239. The widow and children of a ship's engineer sued the shipowner for damages in respect of the engineer's death, which was caused by the fault of a compulsory pilot. The claim was met by the defence of collaborateur, a Scottish doctrine which was equivalent to the English doctrine of common employment. By reason of s. 15 of the Pilotage Act 1913 (U.K.) - a provision in terms similar to s. 410B(2) of the Navigation Act 1912 (Cth) as amended, which I shall have occasion to consider later in these reasons - the owners of the "Smerdis" were to be answerable for any loss or damage caused by any fault of the navigation of the vessel in the same manner as they would be if pilotage were not compulsory. The pursuers maintained that the true relation between the owners and a voluntary pilot was that of agency and not of service, in which case the defence of collaborateur would have no place. The Lord President, in a judgment with which all three other members of the Court agreed, examined the submission in a passage which reads as follows (at p. 241):
person in charge of the ship is not the owner's
servant, and the owner is therefore not responsible
for his acts. Thus at common law the basis of the
owner's immunity is the legal compulsion upon him.
... If the owner or his agent, the master, should
request or permit the pilot to continue in command
of the ship beyond the time he is bound by law to
permit him so to do, then the relation between the
owner and pilot becomes at common law a contractual
relation of service, to which the maxim of
'respondeat superior' directly applies".
"The point mainly relied on by the pursuers was theHis Lordship concluded, at p. 242 that:
absence of power, on the part of the owners of the
ship, to direct and control the manner in which the
pilot exercised his duties. But if the employment
is voluntary, I see no more reason to doubt the
right of the employer to do so - however foolish it
might be of him to attempt it - in the case of the
pilot than in the case of the captain. It is, no
doubt, true that the highly skilled nature of the
work to be done and the remoteness of the ship from
her owners make actual direction and control
practically impossible in either case. But it is
now for the first time suggested that the legal
relation between a seaman and the owner of the
vessel on which he serves is other than that of
master and servant; and - though I rather think it
is true that there is no case in which the true
nature of the legal relation of a pilot
(voluntarily engaged) to the owners has been
canvassed - it has never been doubted throughout a
long series of cases that it is that of service.
The earliest quoted to us was that of The "Maria"
[1839] EngR 1025; (1 W.Rob. 95, per Dr. Lushington at pp. 107, 108).
Lord Chelmsford evidently treated the point as one
not open to doubt in Prowse v. European and
American Steam Shipping Co. [1860] EngR 1020; (13 Moo PC 484), see
at end of judgment. And the same understanding
clearly underlies the reasoning in one of the
latest cases (Steamship "Beechgrove" v.
Aktieselskabet "Fjord", 1916 S.C. (H.L.) 1; (1916)
1 A.C. 364). It is unnecessary to make a larger
citation".
"the liability artificially made to rest on the
owners must be taken with all the legal
qualifications attaching to it, and the defence of
collaborateur is one of them".
3. In Australia, the extent and nature of the liability of the shipowner for
the negligence of a compulsory pilot is to be determined
in the context of s.
410B of the Navigation Act 1912. That section reads:
"(1) A pilot who has the conduct of a ship is
subject to the authority of the master of the ship
and the master is not relieved from responsibility
for the conduct and navigation of the ship by
reason only of the ship being under pilotage.
(2) Notwithstanding anything contained in a law ofThere is no difficulty in reaching the conclusion that the owner of the ship is vicariously liable for the negligence of the pilot. The problem is to determine whether the scope of that liability leaves any room for a finding of vicarious liability in the pilotage authority, the general employer of the pilot. Sub-section (1) of s. 410B confirms that the rationale for subjecting the owner of the ship to liability is grounded in the incorporation of the pilot into the shipowner's enterprise in the capacity of a servant. The pilot is declared to be subject to the authority, that is the control, of the master. Alternatively, the pilot's position may be described in the words used by the Lord President in Smerdis, at p. 241, namely, as "a constituent member for the time being of the organisation composed of the officers and crew". This is so whether the pilotage is voluntary or compulsory. Furthermore, the terms of sub-s. (2) plainly impute the pilot's negligence to the shipowner in all cases where loss is caused through faulty navigation, leaving it responsible for damage to its own ship as well as for injury caused thereby to the property of another: Workington Harbour & Dock Board v. Towerfield (Owners) (1951) AC 112.
the Commonwealth or of a State or Territory, the
owner or master of a ship navigating under
circumstances in which pilotage is compulsory under
a law of a State or Territory is answerable for any
loss or damage caused by the ship, or by a fault of
the navigation of the ship, in the same manner as
he would if pilotage were not compulsory".
4. I have dwelt at some length on an examination of the basis on which it
must be taken to be established that Oceanic is vicariously
liable to
Hamersley for the negligence of the pilot because it seems to me to lead
necessarily to a rejection of Oceanic's claim
to an indemnity from Pilbara
pursuant to s. 7 of the Act. One must have regard to the undisputed finding
that Captain Hammonds was
a competent pilot adequately qualified to be
appointed as such. In the light of that finding, the only basis available to
Oceanic
in support of its claim is the proposition that Pilbara, as the
employer of the pilot, was vicariously liable to Hamersley for his
faulty
navigation. But that liability cannot co-exist with an identical liability
attaching to Oceanic. It is unnecessary to look
for the exceptional
circumstances that would, consistently with the views of the House of Lords in
Mersey Docks and Harbour Board
v. Coggins and Griffith (Liverpool), Ltd. [1946] UKHL 1;
(1947) AC 1, result in the transfer of the service and control of a servant
from a general
employer to a particular employer so
as to attach vicarious
liability for the servant's negligence to the latter.
It is unnecessary
because the statute has pre-empted
the answer. It has declared in effect that
when Captain Hammonds was bringing
the "Oceanic Crest"
into its berth in
Dampier on 8
August 1978 he was subject to the authority of the master of the
ship and in a
master-servant relationship
with its owner. That being
so, we
have a situation in which the biblical truth that "no man can serve
two
masters" may not be without
relevance. No doubt the
reason why the common law
identified the voluntary pilot so strongly with
the ship was because
originally
pilots were self-employed.
It was the case, as Earl Loreburn
observed in delivering the judgment
of their Lordships in Fowles v.
Eastern
and Australian Steamship
Company, Limited (1916) 2 AC 556, at p 560, that:
"Originally the business was simply a matter ofIn that situation it was imperative that the law merchant provide for those who suffered damage from the faulty navigation of a ship to have recourse against the owners of the ship. The exemption of the shipowner from liability in the case of compulsory pilots came under attack increasingly in the 19th century (see Geen & Douglas The Law of Pilotage 2nd ed. (1983) Chapter 1). Finally, efforts were made to unify the municipal laws of all nations relating to collisions between ships or to damage caused (without collision) by one ship to another ship and her cargo resulting in the International Convention for the Unification of Certain Rules of Law in Regard to Collisions (signed at Brussels, 23 September 1910). Article 5 of the Convention abolished the defence of compulsory pilot. The change was effected in the United Kingdom by the Pilotage Act 1913, s. 15, which repealed s. 633 of the Merchant Shipping Act 1894 (U.K.). For the history surrounding the Convention and its subsequent implementation in the United Kingdom, see Owners of the Steamship Towerfield v. Workington Harbour and Dock Board (1949) P 10, at pp 22-23, 46-47.
private enterprise; seamen of local experience made
their own bargains with masters of ships".
5. The development of pilotage authorities and statutory regimens for the licensing of pilots has not resulted in any diminution of the responsibility placed upon the shipowner for the negligence of a pilot. It has been held consistently that so long as the authority employs qualified and competent pilots it is not vicariously liable for their negligence: Holman v. Irvine Harbour Trustees (1877) 4 Sess. Cas. (4th Ser.) 406; Dudman v. Dublin Port and Docks Board (1873) Ir R 7 C.L. 518; Shaw, Savill and Albion Company v. Timaru Harbour Board (1890) 15 App Cas 429; Otago Harbour Board v. Cates (1884) 2 NZLR 123; Actieselskabet Bannockburn v. Williams (1912) 12 SR (N.S.W.) 665; Fowles; City of Los Angeles v. Standard Transp. Co. (1929) 32 Fed. Rep. 2d 988.
6. In Fowles, the Government of Queensland was sued to recover damages
sustained by the plaintiff's ship by reason of the negligence
of a compulsory
pilot. The Judicial Committee reviewed the statutory framework under which
the State charged pilotage rates which
were paid into the Treasury, employed
pilots in the public service, paid them salaries and provided them with boats,
implements and
crews, and then continued, at pp. 562-563:
"In their Lordships' opinion these Acts ofTheir Lordships added the comment that if they had thought the Government was directed to carry on the business of pilotage, that is to say to become "the principals in the piloting of ships" then they would have held it responsible for negligence in the conduct of that business.
Parliament did not alter the original status of a
pilot, which is, in effect, that he must be
regarded as an independent professional man in
discharging his skilled duties. If it had been
intended to alter this old and familiar status, it
is to be supposed that the Legislature would have
done it more explicitly. What it has done is more
consistent with a different and limited purpose,
namely, to secure a proper selection, a proper
supply, a proper supervision, and a proper
remuneration of men to whose skill life and
property is committed, whether the shipowner likes
it or not. For this purpose they become servants
of the Government. For the purpose of navigating
ships they remain what they were, and the duty
which the State or Government owes to a shipowner,
exercised, it is true, by various authorities, is
to provide a qualified man in the terms of the
statutes, but not to take the conduct or management
of the ship. It is not said that they have failed
in this duty of providing a qualified man".
7. Counsel for Oceanic has argued that the present case is to be distinguished from Fowles because Pilbara is in the business of piloting ships, and thus within the qualification expressed by their Lordships. I am unable to accept that submission. True it is that Pilbara is a private company incorporated for commercial purposes. In accordance with the Hamersley Iron (Port of Dampier) By-laws Pilbara exercised substantial control over the use of the port after the assignment agreement with Hamersley in 1974. But the by-laws, on their proper construction, have nothing to say about pilots or pilotage charges. The establishment of the port, the appointment of pilots, the provision for compulsory pilotage and the levying of pilotage rates were all matters which were dealt with by the Governor pursuant to the Shipping and Pilotage Act 1967 (W.A.) as amended. Indeed, once Dampier was proclaimed a port under that Act in 1971, the entry and departure of vessels into and from the port and their movement within the port came under the control of a Harbour Master appointed by the Governor. It was agreed between Hamersley and the State that upon the proclamation of the port, the Governor would be advised to appoint, for the time being at least, Hamersley's Marine Manager to be the Harbour Master, provided that the Company would ensure that only persons adequately qualified for the purpose be appointed Marine Manager, and that it would ensure that when acting as Harbour Master the Marine Manager acted in good faith in the interests of all the shipping using the port. It was also agreed that until the Marine Manager ceased also to be the Harbour Master, pilots for the port would be appointed and removed under the Act in accordance with requests made by the Company, but the Company could only request the appointment of persons who were adequately qualified for the purpose. It was arranged that although pursuant to the Shipping and Pilotage Act 1967 the pilotage charges levied in accordance with that Act were to be paid to the State, the Company would be given the benefit of such charges as related to the services of pilots who were also employees of the Company. In 1973, on the nomination of Hamersley, Captain Hammonds was appointed by the Governor to be a pilot at the port of Dampier.
8. As I have indicated, in 1974 Hamersley assigned to Pilbara certain of its rights and obligations in relation to the port. So far as material, Pilbara agreed with Hamersley to "provide services of a high standard and competent manner of towing and pilotage of all vessels entering departing or moving within the Port of Dampier as required by ... the Shipping and Pilotage Act 1967 and its Regulations". The State agreed to the substitution of Pilbara for Hamersley in relation to the nomination of pilots and the remuneration for pilotage services. It is common ground that Captain Hammonds then became an employee of Pilbara.
9. I agree, with respect, with the conclusion of Burt C.J. in the Full Court that this statutory framework and Pilbara's role in relation thereto is not to be distinguished from the context in which Fowles was decided. Pilbara itself had no authority to engage in the piloting of ships. Its obligation to provide pilotage services as required by the Shipping and Pilotage Act 1967 was limited to the nomination to the State of persons suitably qualified to be appointed by the Governor as pilots under that Act and the employment of sufficient qualified pilots to meet the needs of the port.
10. It was also urged on behalf of Oceanic that the decision in Fowles should not now be followed by reason of developments in recent decades in the law of vicarious liability, whereby an employer has been held vicariously liable for the negligence of his servants even in circumstances where it was not practicable for the employer to exercise any de facto control over the performance of their work. But in this respect I agree with the view expressed by Smith J. in the Full Court to the effect that the submission misunderstands the thrust of Fowles' case. Their Lordships were not concerned with the question of control of an employee by a master so as to make the servant's act that of the master. They were concerned with questions of status and of statutory authority. Captain Hammonds did not derive his authority to navigate the "Oceanic Crest" from his employment by Pilbara, for Pilbara had no such authority. His authority as a pilot came from his appointment as such by the Governor in accordance with s. 4(b) of the Shipping and Pilotage Act 1967. It was his personal authority, and his alone. This consideration invites the further comment that it is the statutory authority possessed by the servant that renders the employer immune to vicarious responsibility for the conduct of the servant in the exercise of that authority and not the character of the employer. It is immaterial whether the employer be the Crown, as in Fowles, a statutory corporation, as in Stanbury v. Exeter Corporation (1905) 2 KB 838, or a private company, as in this case.
11. In any event, I would hesitate long before declining to apply Fowles to
this case. It is a decision which has stood for seventy
years. It may have
been responsible for the absence in Western Australia, South Australia and
Tasmania, of a statutory limitation
of the liability of a pilotage authority
such as was effected in the United Kingdom by the Pilotage Authorities
(Limitation of Liability)
Act 1936 (see now the Pilotage Act 1983 (U.K.), Part
III). But for total exclusion of liability see in Queensland The Queensland
Marine Act of 1958 as amended, s.182; in New South Wales the Maritime Services
Act 1935 as amended, s.21B. The liability of the
shipowner has long been
limited: Merchant Shipping Act, 1894 (U.K.) s. 503; see now Part
VIII of the
Navigation Act (Cth) 1912. The liability of the pilot is limited by the
Pilots' Limitation of Liability Act 1962 (W.A.). In all the circumstances, I
see no reason to doubt the correctness of Fowles. But even if I am wrong in
that regard, the
case may be one to which the observation of Lord Diplock in
Geelong Harbour Trust Commissioners v. Gibbs Bright & Co. [1974]
HCA 2; (1974) 129
CLR 576
is applicable. His Lordship stated at p 582:
"The law laid down by a judicial decision, even
though erroneous, may work in practice to the
satisfaction of those who are affected by it,
particularly where it concerns the allocation of
the burden of unavoidable risks between parties
engaged in trade or commerce and their insurers".
12. I would dismiss the appeal.
BRENNAN J.: On 8 August 1978 a bulk iron ore carrier, the "Oceanic Crest", struck a dolphin as it was berthing in Dampier Harbour in Western Australia. A dolphin is a buffer constructed of piles driven into the seabed. The dolphin was severely damaged. It was owned by Hamersley Iron Pty.Ltd. ("Hamersley"). At the time, the ship was under compulsory pilotage. The pilot was a Captain Hammonds, who had been appointed as a pilot for the port of Dampier and who was employed, in circumstances presently to be mentioned, by the respondent Pilbara Harbour Services Pty.Ltd. ("Pilbara"). Pilbara is a wholly-owned subsidiary of Hamersley and employs the pilots who navigate ships within Dampier Harbour. The "Oceanic Crest" was owned by the appellant, Oceanic Crest Shipping Company ("the shipping company"). In the Supreme Court of Western Australia, Hamersley sued Pilbara and the shipping company for damages. Hamersley alleged that Pilbara was negligent in that, inter alia, "its servant the pilot set the vessel down too hard onto the dolphin", and that the shipping company was negligent in that, inter alia, "by its servants the Master of the vessel and the pilot ... it set the vessel down too hard on to the dolphins". Wallace J. found that the master of the vessel and the pilot were both negligent. Finding these officers to be servants of the shipping company, his Honour held that company liable. His Honour held that the shipping company was the "particular employer" of Captain Hammonds and that it, not the "general employer" Pilbara, was vicariously liable for the pilot's negligence. Accordingly, judgment was entered for Hamersley against the shipping company for damages in the agreed sum of $625,362.36, and for costs. Judgment was entered for Pilbara against Hamersley. On appeal to the Full Court, the finding that the master was negligent was set aside, but the finding that the pilot was negligent was affirmed. No challenge is now made to the Full Court's findings of fact. The shipping company was held vicariously liable for the pilot's negligence, and a majority of the Full Court held that the decision of the Privy Council in Fowles v. Eastern and Australian Steamship Company, Limited (1916) 2 AC 556 precluded a finding that Pilbara, though employer of the pilot, was vicariously liable for the pilot's negligence. Accordingly, the judgment in favour of Pilbara against Hamersley was not disturbed.
2. In third party proceedings, each of the shipping company and Pilbara
claimed against the other to be entitled to an indemnity
or alternatively to
contribution in respect of any sum which Hamersley might recover against it.
The grounds on which the shipping
company's claim for an indemnity was made
were stated in its contribution notice as follows:
" that the negligence of the said pilot and/or ofThe shipping company's claim to be indemnified thus rested on contract or on statute. The Western Australian Act (hereafter "the Tortfeasors Contribution Act") is in familiar form. In particular s.7(1)(c) of that Act corresponds with s.6(1)(c) of the Law Reform (Married Women and Tortfeasors) Act 1935 (U.K.). In so far as the shipping company's claim rested on the Tortfeasors Contribution Act, the shipping company was bound to show that it and Pilbara were tortfeasors and that, if the shipping company were liable to Hamersley, Pilbara was liable to Hamersley in respect of the same damage: see s.7(1)(c).
the said tug - each of which was provided by you
- caused or contributed to the said collision and
that in such circumstances it is entitled thereto
by contract and/or pursuant to the provisions of
the Law Reform (Contributory Negligence &
Tortfeasors Contribution) Act 1947".
3. In its defence to the third party proceedings brought against it by Pilbara, the shipping company pleaded that the damage suffered by Hamersley "was caused or contributed to by the negligence of (Pilbara) by its servant or agent (the pilot) and not by any negligence whether by act or omission for which in law (the shipping company) is liable". In its counterclaim, the shipping company pleaded that "in the premises, if it is found liable to (Hamersley) then it is entitled to be indemnified by (Pilbara) to the full extent of any such liability".
4. The issues arising in the third party proceedings brought by the shipping
company against Pilbara do not include the issue of
Pilbara's direct liability
to the shipping company for damages in tort. They were sketched rather than
defined by the brief claims
and pleadings which they exchanged, but they
include the following:
(1) was Pilbara bound by contract to indemnify the
shipping company for the damages awarded
against it to Hamersley?
(2) were Pilbara and the shipping company bothWallace J. made no finding on the first issue, perhaps because it was not pursued at the trial. The majority of the Full Court held that there was no contract between the shipping company and Pilbara. Accordingly, the first ground of the shipping company's claim for an indemnity failed. And as Wallace J. and the majority of the Full Court held that Pilbara was not vicariously liable to Hamersley for Captain Hammonds' negligence, the second ground of the shipping company's claim for an indemnity also failed. Accordingly, an order dismissing the shipping company's counterclaim in the third party proceedings against Pilbara was made by Wallace J. and, presumably, that order was intended to dismiss also the shipping company's original claim. The shipping company now appeals against the Full Court's judgment dismissing its appeal against the dismissal of its claim in the third party proceedings. There are two difficulties relating to a consideration of the shipping company's third party claim against Pilbara which should be mentioned at this stage. The first is that, while Hamersley was a party to the proceedings before the Full Court, it is not a party to the present appeal. The second is that the shipping company's argument on this appeal goes outside the issues raised by the pleadings. It will be necessary to consider subsequently whether the extended issues can properly be determined in this appeal.
liable to Hamersley for the negligence of
Captain Hammonds?
5. Pilbara submits that there are three objections which are fatal to the shipping company's claim as raised by the pleadings. It is submitted first that the judgment of the Privy Council in Fowles establishes the immunity of Pilbara as a pilotage authority from vicarious liability for the negligence of a pilot; secondly, that there was no personal duty to navigate the "Oceanic Crest" carefully owed by Pilbara to Hamersley; and, thirdly, that s.410B of the Navigation Act 1912 (Cth) imposes liability for the consequences of the negligence of a compulsory pilot on the owner of the ship and excludes any such liability on the pilot's employer. No challenge is made by either party to the finding that there was no contractual obligation on Pilbara to indemnify the shipping company. The consideration of these objections requires mention of the statutes and agreements which affected the relationships among Hamersley, Pilbara, the shipping company and the pilot. It is to those statutes and agreements that I now turn.
6. On 30 July 1963 Hamersley and the State of Western Australia ("the State")
made an agreement relating to the development of iron
ore deposits in the
Hamersley Range ("the Iron Agreement"). The Iron Agreement was approved by
the Iron Ore (Hamersley Range) Agreement Act 1963 (W.A.) as amended. Clause
20 of the Iron Agreement authorized the Company at any time to assign to an
associated company "as of
right and to any other company or person with the
consent in writing of the Minister" the whole of the Company's rights under
the
Iron Agreement and "the obligations of the Company hereunder". The first
recital to the Iron Agreement defined "the Company" to
include "the successors
and assigns of the Company including where the context so admits the assignees
and appointees of the company
under clause 20 hereof". As we shall see,
Pilbara became the assignee of Hamersley under cl.20. By cl.10(2)(f) of the
Iron Agreement
"the Company" agreed -
" subject to and in accordance with by-laws (whichBy s.4 of the Act the Governor was empowered to "make by-laws, for the purposes of, and in accordance with, the Agreement", and cl.10(3) of the Iron Agreement provided that:
shall include provision for reasonable charges)
from time to time to be made and altered as
provided in subclause (3) of this clause and
subject thereto or if no such by-laws are made or
in force then upon reasonable terms and at
reasonable charges (having regard to the costs
thereof to the Company) (to) allow the State and
third parties to use the Company's wharf and
harbour installations wharf machinery and
equipment and wharf and harbour services and
facilities PROVIDED THAT such use shall not
unduly prejudice or interfere with the Company's
operations hereunder; and that the Company shall
have the entire control of such use and that no
personnel other than personnel provided or
approved by the Company shall be utilised for or
in respect of such use."
" The Governor in Executive Council may uponOn 6 October 1971 the Hamersley Iron (Port of Dampier) By-laws were made under the Iron Ore (Hamersley Range) Agreement Act and the Iron Agreement. By-law 78 provided, inter alia:
recommendation by the Company make alter and
repeal by-laws for the purpose of enabling the
Company to fulfil its obligations under
paragraphs ... (f) of subclause (2) of this
clause ..."
" Pursuant to paragraph (f) of subclause (2) of"Port service" was defined to mean, inter alia, "any service ... rendered or provided by the Company for or in connection with vessels using the port, any wharf or any port installation ... (including ... pilotage and towage services) ..." (By-law 3(15)). By-law 29 provided, inter alia:
Clause 10 of the Agreement ... the Company shall
have the entire control of all port services,
port facilities and port installations and no
personnel other than personnel provided or
approved by the Company shall be utilized for or
in respect of such use."
" (1) All dues are hereby levied and charged for
the use and benefit of the Company and
(notwithstanding any other provision of these
by-laws) the owner master and agent of a vessel
in respect of or in connection with which any
dues are payable shall be jointly and severally
liable for such dues.
(2) All dues shall be paid to the MarineThis by-law encompassed pilotage charges which would otherwise have been payable to the harbour master for the benefit of the State under regulations made pursuant to the Shipping and Pilotage Act 1967 (W.A.). That Act empowers the Governor to declare any place to be a port (s.10). When a place is declared to be a port the harbour master of the port is empowered to control the berthing, mooring and moving of vessels within the port (s.5(1)(b)); pilotage charges in respect of the usage of pilotage facilities by a vessel entering, departing from or moving within a port are payable (s.9(1)); and the regulations might provide for compulsory pilotage (s.9(2)(a)). The Governor is empowered to make the necessary regulations (s.12). The port of Dampier was proclaimed to be a port and on 6 October 1971 the Port of Dampier Regulations were made under the Shipping and Pilotage Act. The regulations provide for compulsory pilotage. Subject to certain immaterial exceptions, the master of a vessel is prohibited from causing or permitting his vessel to enter or depart from the port without having first taken on board a pilot (reg.7) and the master or owner of the vessel is required to pay prescribed pilotage charges to the harbour master (reg.13). The term "pilot" is defined to mean "any person appointed by the Governor to be a pilot at the port" (reg.2).
Manager but the Company may at any time sue for
and recover the same in any court of competent
jurisdiction."
7. On 30 September 1974, Hamersley made an agreement with Pilbara ("the
Hamersley-Pilbara Agreement") in exercise of Hamersley's
right to assign its
rights and obligations under the Iron Agreement. By cl.3(1) of the
Hamersley-Pilbara Agreement, Pilbara agreed
to -
" ... provide services of a high standard and
competent manner of towing and pilotage of all
vessels entering departing or moving within
the Port of Dampier as required by -
(i) the Iron Agreement and its By-Laws
(ii) ...
(iii) Shipping and Pilotage Act 1967 and its
Regulations; or
(iv) ..."By cl.5 of the Hamersley-Pilbara Agreement, Pilbara was to have the entire responsibility of recruiting and employing labour qualified and competent to perform the work and, in particular, the responsibility for recruiting and employing qualified and competent pilots. By cl.7(1), Pilbara agreed to make and collect charges for the pilotage and towing services to be performed by Pilbara. An agreement was made between the State and Pilbara whereby the Public Works Department was to allow Pilbara to nominate the harbour master and the pilots for the Port of Dampier. The Government agreed, inter alia, to appoint and remove pilots for that port in accordance with Pilbara's request and agreed to ensure that so long as Pilbara should provide pilotage services it should have the benefit of any pilotage charges levied for the services of pilots who are Pilbara's employees.
8. Pilbara recruited and employed Captain Hammonds whose experience and
credentials made him qualified and competent to perform
the work of a pilot.
His immediate superior was Captain Nielsen, an employee of Pilbara and the
harbour master and marine manager,
who had authority to give Captain Hammonds
instructions and advice if he considered that necessary. Captain Nielsen and
Captain
Hammonds were appointed to the respective offices of harbour master
and pilot under the Shipping and Pilotage Act and in accordance
with the
agreement between the State and Pilbara.
No Contract between the Shipping Company and Pilbara
9. The master of the "Oceanic Crest", being bound by reg.7 of the Port of Dampier Regulations to take a pilot on board, took on board Captain Hammonds. He became liable to pay the pilotage charges prescribed by the regulations. If it were not for the provisions of the regulations making pilotage on entering the Port of Dampier compulsory, a contract for the engaging of the pilot and the payment of a pilotage fee may have been implied between the shipping company or the master on the one hand and Pilbara and the pilot (or one of them) on the other. When the question is whether a contract has been made for the provision of pilotage services in a case where pilotage is compulsory, something in the nature of a consensual arrangement must appear before a contract can be found - something more than an arrangement on the part of the shipowner or master to discharge the statutory obligation by taking a pilot on board and permitting the pilot to navigate the ship: see per Barton A.C.J. in Fowles v. Eastern and Australian Steamship Co.Ltd. [1913] HCA 31; (1913) 17 CLR 149, at pp 167-168 (an appeal to this Court on a case stated before the trial of the action which led to the appeal to the Privy Council earlier mentioned). In the present case, the master of the "Oceanic Crest" was not shown to have done more than to have taken Captain Hammonds on board and to have permitted him to navigate the ship within the harbour. No contract was thereby to be implied between the shipping company or the master on the one hand and Pilbara or the pilot (or one of them) on the other. The Full Court was right in so holding.
10. It follows that there was no contractual obligation owed by Pilbara to
the shipping company to exercise reasonable care in rendering
pilotage
services although, as we have seen, Pilbara had made an agreement with
Hamersley that it would provide pilotage services
"of a high standard and
competent manner". The import of the contractual obligation owed to Hamersley
will be considered presently.
For the moment, it is sufficient to note that
the absence of a contractual obligation owed by Pilbara to the shipping
company to
exercise reasonable care in rendering pilotage services removes one
of the bases on which the shipping company might have founded
its claim for an
indemnity. Where an employee or contractor who is bound by his contract with
his employer to use reasonable care
and skill in performing his allotted task
is negligent and his negligence makes the employer liable in damages to a
third person,
the employer is entitled to recover an indemnity for his
liability from the employee or contractor as damages for breach of contract.
This was one of the bases, and perhaps the only basis, on which the employer
of a negligent lorry driver was held entitled to recover
from the driver
damages amounting to an indemnity in Lister v. Romford Ice and Cold Storage
Co.Ltd. [1956] UKHL 6; [1956] UKHL 6; (1957) AC 555.
An employer's
cause of action for damages for breach of
contract by an employee or contractor whose negligence results
in the
employer's
liability
in damages to a third party is well established (see Voli
v. Inglewood Shire Council [1963] HCA 15; (1963) 110 CLR 74,
at p 100) where an obligation
on
the employee or contractor to act carefully is expressed or is to be implied
in the contract of
employment. This Court has not
yet been required to
consider whether such an obligation is to be implied in an
ordinary contract
for services (cf. McGrath v. Fairfield
Municipal Council [1985] HCA 33; (1985) 59 ALJR 655;
59 ALR 18). In Mowbray v. Merryweather (1895) 2 QB
640; Honeywill and Stein,
Ld. v. Larkin
Brothers, Ld. (1934)
1 KB 191 and Sims v. Foster Wheeler Ltd.
(1966) 1 WLR 769; (1966) 2
All ER 313, an employer recovered damages
from a
contractor whose
negligence resulted in the employer's liability to a third
party.
The employer recovered in each case for
breach of an obligation
resting on the contractor to act carefully. The obligation in each
case was
implied from the contract or,
in Honeywill and Stein,
Ld., the obligation was
"either in contract or for negligence" - a
question that was not contested
(see p.195).
Counsel for the
shipping company placed some reliance on
Honeywill and Stein, Ld. in
support of an argument that a contractor owes
an
obligation
of reasonable care to the employer for breach of which the
contractor
is liable in tort, but that case is not an authority
for that
proposition. The issue in that case was whether the employer of the
contractor
owed a duty of care to an injured party whose
theatre
was damaged by the
independent contractor in the course of performing
an extra-hazardous
function. That question arose not
because
there was a contest as to the
existence of a non-contractual duty owed
by the contractor to the employer,
but because the
independent
contractor asserted that the employer was under no
liability to the
injured party.
A Claim in Tort for an Indemnity
11. The cases relating to damages recoverable by an employer for breach of contract by a negligent employee or contractor are mentioned to deny their relevance to the existence of a non-contractual duty to act carefully owed to one who would become liable to a third party in damages if the duty were breached. Counsel for the shipping company argued that Pilbara was under a non-contractual duty of care to it, and that the shipping company is entitled to recover damages in tort for the liability to Hamersley which was imposed on it because of Captain Hammonds' negligence. As we shall see, such a duty cannot be the foundation of the shipping company's claim for contribution under the Tortfeasors Contribution Act. The existence of such a duty can be material only as an element in an independent cause of action in tort.
12. The existence of a cause of action in tort for damages representing the amount of compensation paid or payable to an injured third party was left undecided in Lister v. Romford Ice and Cold Storage Co.Ltd. (see pp 579-580, 585-586), not considered in McGrath (see pp 655-656; p 19), and passed over in Honeywill and Stein, Ld. If there be such a cause of action, its elements have not been judicially defined. The circumstances of this case would require that, if the shipping company had raised and pursued a claim founded on such a cause of action, consideration be given to its elements, evidence relevant to those elements be received and the necessary findings of fact be made. That did not happen and, it seems, no application was made that it should happen. One issue that would have arisen is this: what is the damage which a plaintiff is entitled to recover? In argument the damage was said to be an amount which the plaintiff is called upon to pay in respect of his liability to the injured third party. But would damages be recoverable by a plaintiff for an amount which he had not paid or at least been held liable to pay to the injured third party? And that issue leads to another: when does the cause of action arise? If the cause of action is not complete before the liability of a plaintiff to the third party is crystallized in some way, any claim for damages in tort which the shipping company might have raised in this case had not arisen when the action commenced or, I assume, when the contribution proceedings began.
13. There are some unresolved questions of principle that must be judicially
decided before the existence of such a cause of action
can be affirmed. Are
the plaintiff and the defendant concurrent tortfeasors, and, if so, does the
rule in Merryweather v. Nixan
(1799) 8 TR 186 (101 ER 1337) affect the cause
of action (a question raised but not answered in Lister v. Romford Ice and
Cold Storage
Co.Ltd.)? If plaintiff and defendant are concurrent tortfeasors,
and the plaintiff is entitled to recover damages before he pays
compensation
to the injured third party, is the defendant liable for damages in tort to the
injured third party and to the plaintiff
so that he may be compelled to pay
twice? And is the plaintiff, irrespective of any fault on his part, entitled
to a full indemnity
from the defendant? These questions received no
consideration in the shipping company's argument either in this Court or, so
far
as the record shows, before Wallace J. and the Full Court. Although
counsel with undoubted accuracy assured us that a breach of duty
owed by
Pilbara to the shipping company was argued below, the cause of action to which
such a duty might have been material was not
pleaded and the issues which the
raising of such a cause of action throw up for consideration were not
addressed. In Dare v. Pulham
(1982) 148 CLR 658, at p 664, this Court
unanimously reaffirmed the principle that "(a)part from cases where the
parties choose to
disregard the pleadings
and to fight the case on issues
chosen at the trial, the relief which may be granted to
a party must be
founded
on the pleadings".
Clearly enough, there was no agreement to fight
this case on issues relating to an independent
cause of action
in tort. When
counsel
for Pilbara was asked to address the question of a cause of action in
tort, he had understandable
difficulty
in identifying what
was the duty said
to be owed to the shipping company by Pilbara arising out of the act of the
pilot.
It may be
that a cause of action
in tort for damages amounting to an
indemnity could have been litigated in this action if it had
been pleaded
or
if, without pleading,
the parties had expressly or by the conduct of their
cases raised the necessary issues for
decision. But
clearly the issues which
the alleged cause of action raised for decision were not addressed. The
supposed cause of
action to which
alone the duty of care
owed to the shipping
company was material was not litigated, and no relief founded on the
supposed
cause of
action can be ordered.
It is not for this Court to seek out a case
different from what was litigated below (Maloney
v. Commissioner
for Railways
(1978)
52 ALJR 292, at p 294; 18 ALR 147, at pp 151-152).
The Claim under the Tortfeasors Contribution Act
14. The shipping company's third party claim which was pleaded and litigated
and on which it has so far failed was based on s.7(1)(c)
of the Tortfeasors
Contribution Act. On this basis Lord Morton of Henryton and perhaps Viscount
Simonds in Lister v. Romford Ice
and Cold Storage Co.Ltd. held the employer of
the negligent lorry driver entitled to contribution amounting to a full
indemnity.
It is convenient to recall the terms of s.7(1)(c) -
" Where damage is suffered by any person as the
result of a tort -
...
(c) any tortfeasor liable in respect of that
damage may recover contribution from any
other tortfeasor who is or would if sued
have been liable in respect of the same
damage whether as a joint tortfeasor or
otherwise but so that no person shall be
entitled to recover contribution under
this section from any person entitled to
be indemnified by him in respect of the
liability for which contribution is
sought".
15. The provision relates to contribution in respect of damage suffered by a
person for which two or more tortfeasors are liable
to him. In the present
context, it relates to the damage suffered by Hamersley, not to the damage
suffered by the shipping company
in incurring a liability to Hamersley or in
having a judgment entered against it.
16. Contribution may be recovered only by a tortfeasor "liable in respect of that damage" (in this case, the shipping company which has an unchallenged right to seek contribution) "from any other tortfeasor who is or would if sued have been liable in respect of the same damage". Is Pilbara a tortfeasor liable to Hamersley in respect of the damage suffered by Hamersley? If the answer given by this Court to that question is in the affirmative, a further question will arise: does the judgment dismissing Hamersley's claim against Pilbara preclude a finding of Pilbara's liability to Hamersley in the third party proceedings?
17. The submission that Pilbara is liable to Hamersley can be put on either of two bases: the first, that Pilbara is vicariously liable for Captain Hammonds' negligence in navigating the ship; the second, that Pilbara is personally liable for breach of a duty of care owing by it to Hamersley. Different considerations apply to the two bases of liability.
18. Vicarious liability for the negligence of a pilot is imposed by the common law on the owner of a ship when the pilot's services are engaged voluntarily: The "Maria" (1839) 1 W.Rob.95 [1839] EngR 1025; (166 ER 508); Thom v. Owners of S.S."Smerdis" (1925) SLT 239, at pp 241,242; Fowles 17 CLR, at p 181. That liability has been long established, though its true foundation may be a matter of debate. In Steamship "Beechgrove" Company, Limited v. Aktieselskabet "Fjord" of Kristiania (1916) 1 AC 364, at p 383, Lord Atkinson said that the voluntary employment of a pilot created "a contractual relation of service, to which the maxim of 'respondeat superior' directly applies". His Lordship was there speaking of an application of the maxim as between the owner of a ship and a pilot who was navigating the ship at a time when the ship was not under compulsory pilotage. But there is nothing in the nature of the work of a pilot which excludes an application of the maxim as between the pilot and his general employer. In Holman v. Irvine Harbour Trustees (1877) 4 R. (Sess. Cas.) 406, harbour trustees who employed a boatman (or "hobbler", not a licensed pilot) to conduct a ship into their harbour were held vicariously liable for the boatman's negligence whereby the ship was damaged.
19. However, in Fowles, where a ship under compulsory pilotage was damaged by
the pilot's negligence and the pilot was an employee
of the Queensland
Government, an action against the Government failed. Although the plaintiff
shipowner sought to fix the Government
with liability on the footing that it
was vicariously liable for the negligence of its servant the pilot, Earl
Loreburn, delivering
the judgment of the Judicial Committee, saw the case as
turning entirely upon the nature of the duty cast upon the Government by
the
statutory provisions in force in Queensland. Their Lordships held that the
obligation of the Queensland Government to the ship
owner was no more "than
that of providing qualified pilots" and their Lordships rejected the
proposition that an obligation had been
laid upon the Government for "the
conduct and management of this ship". Earl Loreburn said (at p.562) that -
" it is not conclusive to say that (the pilot) wasIn Field v. Nott [1939] HCA 41; (1939) 62 CLR 660, Dixon J. (at p 675) regarded Fowles as an example of a case where a public officer, although a servant of the Crown, was executing an independent duty which the law casts upon him, so that the Crown was not acting through him and was not vicariously responsible for his negligence. And in Little v. The Commonwealth [1947] HCA 24; (1947) 75 CLR 94, Fowles was one of the authorities cited for the doctrine which his Honour stated in these terms (at p.114):
in their service unless it can also be said that
the Government were 'the principals in the
piloting of ships' to borrow the happy phrase of
Isaacs J. ... If (the pilot) himself was the
principal in the piloting of ships, then the
defendants cannot be liable. It was he and not
they who owed the duty of careful piloting to the
plaintiffs."
" any public officer whom the law charges with a
discretion and responsibility in the execution of
an independent legal duty is alone responsible
for tortious acts which he may commit in the
course of his office and that for such acts the
government or body which he serves or which
appointed him incurs no vicarious liability".
20. When the Crown or a public authority is the employer of a public officer
who is charged by statute with the exercise of an "independent
responsibility
cast on him by law" (the phrase used by Dixon J. in Musgrave v. The
Commonwealth [1936] HCA 80; (1937) 57 CLR 514,
at p 548), what
is done in discharge of that
responsibility is not done on behalf of the employer. The Crown
or public
authority,
having no authority
either to discharge that responsibility or to
control its discharge, is not acting through
the officer and what
is done by
the officer
in discharge of the independent responsibility by the employee is
not regarded as done
in the course of his
employment as a servant
of the Crown
or public authority. The statute which charges the officer-employee with
the
exercise of the
independent responsibility
denies that what he does in
discharge of that responsibility is done on behalf of
or for the benefit of
the Crown or public authority.
But an employer which is a private trading
corporation having a commercial
interest in its employee's
exercise of a
statutory responsibility
stands in a different position. It may be within the
objects and
powers of a trading corporation
- "within the scope of their
incorporation"
to adopt the phrase of Fry J. in Edwards v. Midland Rail.Co.
(1880) 50 L.J.(QB) 281,
at p 284 - to employ servants who will discharge
an
independent statutory responsibility. True it is that
such a servant needs no
authority from and is not amenable to control by
his employer in acting in
discharge of his independent statutory
responsibility,
but in so acting he is
doing what he is employed
to do and he is doing it on behalf of his employer.
This seems to
be the basis on
which railway companies employing special
constables
became liable for a wrongful arrest made or a malicious prosecution
launched
by those constables. In Edwards, Fry J. said:
" In my view it is within the scope of theirThat case was followed in the Court of Appeal in Lambert v. Great Eastern Railway (1909) 2 KB 776 where Cozens- Hardy M.R. said of constables employed by a railway company (at p 781):
incorporation, and is not like a thing entirely
outside the objects of their business. It is a
thing which, taking into account the nature of
their business, they could not reasonably do
without and do not do without."
" No doubt they are servants who are given a
special immunity and protection, and they have
the peculiar protection which other constables
have, namely, that they are not liable if they
have reasonable ground for believing that a
felony has been committed, and that the person
whom they have arrested was guilty of a felony.
If they had such reasonable grounds, their
employers, I take it, would not be liable for
their acts, but if they had not reasonable
grounds, then it seems to me that their employers
must be liable."
21. These cases were criticized by McCardie J. in Fisher v. Oldham
Corporation (1930) 2 KB 364, who sought to distinguish them as
turning on
special statutory provisions. Though the ground of distinction was tenuous in
the extreme, his Lordship's approach to
the vicarious liability of a person
appointing and paying a constable for acts done by the constable in
discharging the duties of
his office accords with and follows the judgments in
this Court in Enever v. The King [1906] HCA 3; (1906) 3 CLR 969. But vicarious
liability
of
a constable's employer was denied in Enever because (taking the criterion from
what
Barton J. said at p.983) "the person
must
be not only the servant of the
superior, but must be under the control of the superior
before the latter can
be held liable".
In
time, the criterion has changed. As Mason J. has
recently pointed out in Stevens v. Brodribb
Sawmilling Company Pty.Ltd. [1986] HCA 1; (1986)
60 ALJR 194, at p 198; [1986] HCA 1; 63 ALR 513, at p 520:
" ... the common law has been sufficiently flexibleThe widening of the criterion for vicarious liability may be of little assistance to those seeking to sheet home vicarious liability to the Crown or to public authorities whose powers are construed as stopping short of engaging in the function involved in the discharge of an independent statutory responsibility. The Crown or a public authority escapes vicarious liability for the negligence of an employed public officer discharging an independent statutory responsibility because the discharge of that responsibility is not a function which the employer is authorized to perform. That was the foundation on which Earl Loreburn rested the immunity of the Government in Fowles. But as the maxim "respondeat superior" applies to a contractual relation of service between a licensed pilot and a shipowner, an immunity of the pilot's employer cannot be taken to rest simply on the statutory authority which a licence confers on a licensed pilot to provide pilotage services. It is only when the functions of an employer are so limited by statute as to exclude the function performed by an employee in discharging his statutory responsibility that the employer is immune from liability for the employee's negligence in discharging that responsibility. But a trading corporation whose objects are advanced by the employment of servants to discharge independent statutory responsibilities and whose powers extend to the employment of servants to advance the corporate objects may be held liable on the same footing as railway companies employing constables, that is: "liable to the extent to which their servant and agent is liable - not further than that, but to that extent" (per Cozens-Hardy M.R. in Lambert, at p.782).
to adapt to changing social conditions by
shifting the emphasis in the control test from
the actual exercise of control to the right to
exercise it, 'so far as there is scope for it',
even if it be 'only in incidental or collateral
matters' (Zuijs v. Wirth Brothers Pty Ltd ((1955)
[1955] HCA 73; 93 CLR 561) at p 571)."
22. In the present case, the piloting of the "Oceanic Crest" by Captain Hammonds was an activity which he performed as part of his duties to his employer, a trading corporation. He was subject to the control of Pilbara at least to the extent of having to obey the instructions of his superior to pilot ships entering the harbour. By piloting the ship he discharged, pro tanto, Pilbara's contractual obligations to the State of Western Australia and to Hamersley to provide pilotage services. Pilbara was empowered to employ him as a servant to pilot ships not only to advance the objects of the corporation but to permit Pilbara to exercise the function conferred on it by By-law 78. By-law 78, as we have seen, gave originally to Hamersley and, after the Hamersley-Pilbara agreement, must be taken to have given Pilbara "the entire control of all port services" including pilotage services.
23. In the light of the development of the law relating to vicarious liability, Fowles should not now be seen to be an obstacle to holding that a trading corporation which is empowered by its constitution (or by a special statute) to employ a licensed pilot to pilot ships under compulsory pilotage is vicariously liable for negligence in the piloting of a ship by a pilot employed by it. The first of the two bases of Pilbara's liability to Hamersley was, in my opinion, established. The second basis depends on the existence of a personal duty of care owed by Pilbara to Hamersley.
24. In Fowles, there was no contract between the Government and the plaintiff
(the shipowner) binding the Government to exercise
reasonable care in the
piloting of the ship. Had the Queensland Government contracted to provide
pilotage services to the shipowner,
it would have been liable for the pilot's
negligence in piloting the ship, as Isaacs J. pointed out (17 C.L.R., at
p.183):
" If the facts admitted amounted to a voluntary
entering upon the business of piloting ships,
quite independently of and in addition to the
functions of Government contemplated by the
Statutes, including in that business the ordinary
responsibility for the careful conduct of the
persons actually performing the task -
practically a guarantee of their carefulness, -
then I do not deny a wholly different situation
would arise. Then, though the law would still,
as I view it, look to the pilot only as the
proper agent to navigate the ship, yet as the
Government chose to place itself in a superadded
relation of contractual responsibility to the
vessel, it might be bound to answer for the
pilot's negligence."
25. In this case, as we have seen, the pilot's employer (Pilbara) was
contractually bound to the plaintiff (Hamersley) to "provide
services of a
high standard and competent manner of towing and pilotage of all vessels ...
within the Port of Dampier" (Hamersley-Pilbara
Agreement, cl.3(1)). I read
the qualifying words of cl.3(1) - "as required by ... the Iron Agreement ...
Shipping and Pilotage Act
1967" - not as restricting the standard of pilotage
services to be provided but as specifying what pilotage services are to be
provided.
Pilbara's assumption of the obligation to provide pilotage services
of a high standard was intended, no doubt, to ensure that pilotage
services
theretofore provided by Hamersley under the Iron Agreement and the By-laws of
6 October 1971 would continue to be provided
for the benefit of the iron ore
trade and the owners and charterers of bulk iron ore carriers. But Pilbara's
contractual obligation
enured also to the benefit of Hamersley whose wharf,
dolphins and other harbour installations would be at risk in the event of
negligence
in the conduct and navigation of ships within the harbour. Pilbara
had undertaken a contractual duty of care to Hamersley and Captain
Hammonds'
negligence constituted a breach of that duty whereby Hamersley's dolphin was
damaged. Accordingly, Hamersley was entitled
to recover from Pilbara damages
for breach of contract. The breach may be described as a failure to discharge
a duty of care, but,
if that duty arose solely out of contract, there would be
much to be said for the view that Pilbara's liability is not properly to
be
classified as the liability of a tortfeasor.
26. A liability which arises solely out of contract may not be a liability which attracts the operation of s.7(1)(c) of the Tortfeasors Contribution Act (see Giffels Associates Ltd. v. Eastern Construction Co. (1978) 84 DLR(3d) 344; McConnell v. Lynch-Robinson (1957) N.I.70). The Western Australian Parliament has not followed the lead of Westminster by enacting a provision permitting contribution as between a tortfeasor and a person liable for breach of contract in respect of the same damage (see The Civil Liability (Contribution) Act 1978 (U.K.) which was enacted to overcome the decision in McConnell v. Lynch-Robinson: Dugdale, "The Civil Liability (Contribution) Act 1978", (1979) 42 Modern Law Review 182).
27. In the present case, the classification of Pilbara's liability to
Hamersley for breach of contract need not be pursued. If
Pilbara is
vicariously liable for Captain Hammonds' negligence, that liability would
bring it within s.7(1)(c) and make it amenable
to a contribution order in
respect of the damage to Hamersley's dolphin. However, counsel for Pilbara
submits that the vicarious
liability which would be imputed to Pilbara by the
common law is excluded by s.410B of the Navigation Act 1912 (Cth) (hereafter
"s.410B").
Section 410B of the Navigation Act
28. That section provides:
" (1) A pilot who has the conduct of a ship is
subject to the authority of the master of the
ship and the master is not relieved from
responsibility for the conduct and navigation of
the ship by reason only of the ship being under
pilotage.
(2) Notwithstanding anything contained in a
law of the Commonwealth or of a State or
Territory, the owner or master of a ship
navigating under circumstances in which pilotage
is compulsory under a law of a State or Territory
is answerable for any loss or damage caused by
the ship, or by a fault of the navigation of the
ship, in the same manner as he would if pilotage
were not compulsory."
29. Section 410B(2) was modelled on s.15(1) of the Pilotage Act 1913 (U.K.)
(which did not take effect until January 1, 1918: s.15(2)).
The purpose
of
that provision, as Bucknill L.J. pointed out in Owners of the Steamship
Towerfield v. Workington Harbour and Dock
Board. The Towerfield
(1949) P 10,
at p 23, was to comply with an International Convention which provided that
liability under the
Articles of the Convention
should attach where the
collision is caused by the fault of a pilot even when the pilot is carried by
compulsion of law. The common
law imposes no liability on the owner of a ship
for damage done by the ship as the result of negligence
on the part of a
compulsory
pilot: The "Maria", at pp.103-104 (p.512); The "Protector" (1839) 1
W.Rob.45, at pp.54-56 (166 E.R.490,
at p.494); The "Beechgrove",
at
pp.380,382,393; Townsville Harbour Board v. Scottish Shire Line Ltd. [1914] HCA 33; (1914) 18
CLR
306, at pp 316,320,327.
Section 15(1) got rid of the defence of
compulsory pilotage, not only by abrogating the common
law immunity
of the
owner from vicarious
liability for the negligence of a compulsory pilot but
also by repealing s.633 of the Merchant
Shipping
Act 1894 (U.K.) which had
given statutory recognition to the common law rule. The effect of the
provision, as Bucknill
L.J. stated
it (at p.23), was to "put
on the shipowner
the same responsibility for the acts of a compulsory pilot as he has always
had for the
acts of a voluntary pilot".
The effect of s.15 of the U.K. Act
was further considered in Workington Harbour & Dock
Board v.
Towerfield
(Owners) (1951) AC 112
("The Towerfield") by the House of Lords. Lord
Radcliffe said (at p 156) that s.15 "must
be construed
so as to impute (the
pilot's)
negligence to the owners, even when they appear as plaintiffs seeking
to recover damages
for injury
to their vessel". Contributory
negligence being
a complete defence at that time, the pilot's negligence precluded the
owners
from
recovering damages in negligence
from any other tortfeasor whose
negligence had contributed to the damage sustained by
the ship.
30. It was submitted, however, that s.410B goes further than sheeting home liability for the pilot's negligence to the owner or master of the ship. Counsel for Pilbara submitted that s.410B excludes vicarious liability in any other person.
31. In The Towerfield, s.15(1) of the Pilotage Act was held to have a wider effect than making the owner of the ship responsible for the compulsory pilot's negligence as if the pilot were the owner's servant. The damage to the "Towerfield" was caused not only by the pilot's negligence but, it was alleged, by errors in a navigation chart, the accuracy of which had been warranted by the Harbour Board. Section 15(1) was held to make the owner liable, to the exclusion of contractual liability (if any) in the Harbour Board, for the damage suffered by the ship because of the pilot's negligence (see especially at pp.134,154-155). The inference might be drawn from the speeches in that case - and it was the inference which counsel for Pilbara submitted that we should draw - that s.15(1) is intended to make the owner or master of the ship not only responsible for any damage caused by the negligence of a compulsory pilot but exclusively liable for that damage. I am not sure that that inference should be drawn, but if that be the view adopted in England in reference to s.15(1) of the Pilotage Act, I would respectfully decline to apply it to s.410B(2). To give s.410B the operation for which Pilbara contends would deny to a plaintiff relief against any person other than the owner or master although that person caused or contributed to the plaintiff's damage. The language of that provision does not go so far.
32. It is further submitted that, if s.410B(2) does not make the owner and master exclusively liable for any damage caused by the negligence of a compulsory pilot, at least it makes the compulsory pilot a servant of the owner for whose negligence only the owner can be vicariously liable. In Thom v. Owners of S.S. "Smerdis" s.15 of the Pilotage Act was held to convert a compulsory pilot into a servant of the shipowner so as to exclude a claim for damages for fatal injury to a seaman on the ground that the pilot and the seaman were common employees of the shipowner. In The Towerfield, Lord Normand expressed his agreement with the view that the compulsory pilot is to be regarded as a servant of the owner. These cases provide a foundation for the submission that s.410B makes the pilot a servant of the owner of the ship and that he cannot have two masters vicariously liable for his negligence. It is submitted that control and liability must be allocated exclusively to one or the other (see Mersey Docks and Harbour Board v. Coggins and Griffith (Liverpool), Ld. [1946] UKHL 1; (1947) AC 1; McDonald v. The Commonwealth (1945) 46 SR(NSW) 129) and, as s.410B allocates liability to the owner, the general employer of the pilot is not liable. The premise on which this submission is based is that s.410B makes the compulsory pilot a servant subject to the control of the owner. The rule to be derived from Mersey Docks and McDonald is not that two persons cannot be vicariously liable for the same damage or that an employee cannot be the servant of two masters, but that two employers of the same servant who negligently causes damage will not both be liable for the damage if one rather than the other has what Jordan C.J. called "the relevant control" (McDonald, at p.132). If a shipowner were held to possess, by virtue of s.410B, a measure of control over a pilot it would be necessary to consider whether s.410B vests "the relevant control" in the shipowner to the exclusion of the pilot's general employer. But s.410B goes directly to the imposition of liability; it does not impose that liability on the footing that it has vested in the shipowner a measure of control over the pilot.
33. Section 410B(2) does not in terms purport to make a compulsory pilot a servant or to confer on the owner a power to control what a compulsory pilot does. Indeed, it is the authority of a pilot to navigate a ship without the authority of the owner or master which makes pilotage compulsory. Section 410B(2) does not purport to override any law of a State or Territory which makes pilotage compulsory and which thereby confers authority on a pilot to navigate a ship. The authority conferred on a compulsory pilot by a State or Territory law is unaffected by s.410B(1), although sub-s.(1) provides that the pilot's conduct of the ship may be taken out of his hands by the authority of the master - an authority for the exercise of which the master must be prepared to show justification (see The Towerfield, at p.142). Section 410B(1) is consistent with and provides for a limit on the pilot's authority by reference to that narrow authority reserved to a master to supersede the instructions of a compulsory pilot. But s.410B(1) does not purport to vest in the master of the ship any control over the pilot in the exercise of his authority. The pilot's authority may be superseded by the master, but its exercise is not subject to the master's control. As s.410B does not extend the master's authority to control the pilot in his navigation of the ship while it is under compulsory pilotage, there is no question of choosing between the allocation of control to the pilot's employer and the allocation of control to the ship's owner or master for the purpose of allocating liability for damage caused by the pilot's negligence.
34. Section 410B(1) makes the master and through him the owner personally liable for damage done by the negligent navigation of the ship, though the negligence is that of the compulsory pilot and such negligence would not be attributed to the ship or to the owner or master at common law (Townsville Harbour Board v. Scottish Shire Line Ltd., at pp 324-326). What s.410B(2) does is to impose a statutory liability on the owner or master for the loss and damage specified, and to define that liability on the hypothesis that pilotage is not compulsory. Although the hypothesis defines the liability, the hypothesis is not deemed to exist. Neither sub-s.(1) nor sub-s.(2) of s.410B creates a relationship of master and servant between the shipowner and the compulsory pilot; neither provision needs to create that relationship to effect the sheeting home of liability to the owner or master. I do not stay to consider whether this view is consistent with the decision in Thom v. Owners of S.S. "Smerdis" or with Lord Normand's observation in The Towerfield, for I am quite unable to regard s.410B as affecting the relationship between the master of the ship and the pilot in connection with the conduct of the ship by the pilot. As s.410B does not give to the owner or master of the ship any control over the pilot in the piloting of the ship, that section cannot affect the vicarious liability of the pilot's general employer for negligence committed in the course of the pilot's employment. It merely creates a parallel, statutory liability in the owner or master. The owner of the ship and the general employer of the compulsory pilot are both liable to a plaintiff whose damage is caused by the negligence of the pilot in the conduct of the ship.
35. Pilbara, the general employer, is liable as a tortfeasor in respect of
that damage, and the statutory liability in respect of
the same damage,
imposed by s.410B on the shipping company, is of the same character: see
Genders v. Government Insurance Office
of N.S.W. [1959] HCA 30; (1959) 102 CLR 363, at p 382.
A claim for contribution under s.7(1)(c) of the Tortfeasors Contribution
Act
may be made
by either
Pilbara or the shipping company against the other of
them. The amount of contribution is a matter for
judicial discretion
and
there
is authority for the view that contribution may amount to a full
indemnity (see the cases collected
in McGrath v. Fairfield
Municipal
Council,
at pp 657-658; pp 22-23).
"Is or would if sued have been liable"
36. It follows that Hamersley's action against Pilbara ought to have succeeded, that judgment should have been entered for Hamersley against Pilbara and the shipping company and that orders for contribution ought to have been made between Pilbara and the shipping company under s.7(1)(c) of the Tortfeasors Contribution Act. But when Pilbara's exoneration from liability to Hamersley was affirmed by the Full Court, the shipping company did not appeal against that part of the Full Court's judgment. So long as the judgment holding Pilbara not liable stands on the record, the shipping company is unable to assert that Pilbara is a tortfeasor who "is or would if sued have been liable" to Hamersley: George Wimpey & Co. Ld. v. British Overseas Airways Corporation (1955) AC 169; W.H. Wright Pty.Ltd. v. Commonwealth (1958) VR 318, at p 321; Castellan v. Electric Power Transmission (1967) 69 SR(NSW) 159, at pp 177, 188,189. The shipping company has now sought an order similar to that in Unsworth v. Commissioner for Railways [1958] HCA 41; (1958) 101 CLR 73 under O.70 r.29 of the High Court Rules. Such an order would provide for the joining of Hamersley as a respondent with a view to amending the record by having judgment entered in solidum against Pilbara and the shipping company. A similar order should be made here to permit the making of a contribution order unless, the judgment having been satisfied by the shipping company, it is too late to amend the record.
37. In Castellan v. Electric Power Transmission, a majority of the Court of
Appeal held that no new trial could be ordered on the
application of one
tortfeasor to decide the liability of another alleged tortfeasor to the
plaintiff when the first tortfeasor had
satisfied the plaintiff's judgment
against him and the plaintiff's claim against the other alleged tortfeasor had
been dismissed
by consent of those parties. The judgment for the alleged
tortfeasor standing as a final judgment, he was immune from an order for
contribution to the tortfeasor who had satisfied the plaintiff's judgment.
Walsh J.A. dissented. In a passage with which I respectfully
agree, his
Honour said (at p.173):
" In order that the rights of all parties should beIn any event, the present case is not one where entry of a judgment for Hamersley against Pilbara depends on the determination of contested issues of fact. The facts are not in dispute and the only question for the appellate court is: what judgment ought to have been entered on those facts by the trial judge? By ordering the entry of judgment for Hamersley against Pilbara on the footing of Pilbara's vicarious liability for Captain Hammonds' negligence, this Court would do no more than remove the procedural impediment to the making of a contribution order against Pilbara.
properly determined in accordance with law, I am
of opinion that this Court has the power and the
duty to set aside any part of the result of the
trial, if it was reached through error of law,
and if it is such that, whilst it stands, it
impedes the proper resolution of the rights of
all parties. It was the automatic consequence of
the entry of verdicts for B.H.P. in the
plaintiff's action that, in the claims of E.P.T.
for contribution against B.H.P., there must be
verdicts for B.H.P. If this was erroneous and
if, so long as it stands, the said claims of
E.P.T. can never be duly determined according to
law, it is proper for this Court to review the
correctness of the entry of the verdicts for
B.H.P. in the plaintiff's action."
38. It was assumed in argument that the contribution order, if made, should amount to an indemnity. That may be right, but it is not self-evident that, as between two parties who are innocent of personal fault and to whom liability is imputed by law, the party whose liability is imputed by statute ought to have an indemnity from the party whose liability is imputed by common law. The question has not been argued. I would allow the parties an opportunity to consider this judgment and, if they fail to agree on a contribution order, I would remit the matter to the Full Court of Western Australia to make such order as may be just under s.7(1)(c) of the Tortfeasors Contribution Act.
39. The order I would make, adopting the order made in Unsworth is as
follows:
1. Appellant be at liberty to add Hamersley as a
respondent to this appeal for the purpose only
of setting aside the judgment dismissing
Hamersley's claim against the respondent and
entering judgment for Hamersley against the
respondent in the sum of $625,362.36.
2. In the event of Hamersley failing or refusing
to consent to be added as a respondent to this
appeal, the appellant to be at liberty upon
notice to Hamersley and to the respondent to
restore the appeal to the list for such
further or other order as may be appropriate.
3. Subject to Hamersley being added as a
respondent and the appellant obtaining and
filing a memorandum of Hamersley's consent
hereto, order that the appeal be allowed, that
the judgment of the Full Court be set aside so
far as it affirmed the dismissal of
Hamersley's claim against the respondent and
the dismissal of the appellant's claim under
s.7(1)(c) of the Tortfeasors Contribution Act
against the respondent and in lieu thereof
order that the judgment entered at the trial
be varied by entry of -
(a) a judgment for Hamersley against the
respondent in the sum of $625,362.36; and
(b) an order declaring that the appellant is
entitled to contribution by the
respondent in respect of the judgment
entered against the shipping company by
Hamersley in such an amount as is agreed
or as may be determined by the Supreme
Court in default of agreement and that
the respondent pay the appellant's costs
of the third party proceedings between
them.
(c) an order that the respondent pay the
appellant's costs of the appeal before
the Full Court.
4. Stand over the appeal for mention.
5. The respondent to pay the appellant's costs of
this appeal.
DEANE J: In Fowles v. Eastern and Australian Steamship Company, Limited (1916) 2 AC 556, at p 561, the Judicial Committee of the Privy Council expressed entire agreement with Barton A.C.J's formulation of the essential question involved in that case. That formulation had been made when the matter was before this Court on a special case prior to the actual trial of the action (see [1913] HCA 31; (1913) 17 C.L.R. 149, at p.167). It propounded a choice between two competing views of the scope of the Queensland Government's duty of care to the shipping owner in respect of the piloting activities of a licensed pilot who was a public servant in its employ. There, as here, pilotage by a pilot licensed for the relevant harbour or port was compulsory under the applicable statutory provisions. Barton A.C.J's formulation of the essential question was in these terms: "Was it, then, the duty (of the Queensland Government) to undertake with due care and skill the pilotage of such vessels, or was it only a duty to supply qualified pilots to those who were bound to accept the services of such officers?"
2. In this Court in Fowles' Case, no decisive answer had been given to that question. Barton A.C.J. and Powers J. thought that the answer to it was that the Queensland Government had undertaken, through its employed pilot, the actual pilotage of the owner's ship and was under a duty of care to exercise, through its employee, due care and skill in that pilotage. Isaacs J. expressed the contrary view. His Honour considered that the pilot in that case, on being licensed for the port of Brisbane, was thereby "appointed" for that port. He was "an independent pilot" (at p.188) who was performing "functions specially entrusted to him personally" (at p.189) and not as agent of his employer: "once the Government have placed the pilot on the vessel, they have reached the limit of their corporate action, and it is (the pilot's) personal duty and responsibility that then come into play" (at p.193). The Government was not "to be considered ... the principals in the piloting of ships" (at p.183). The other two members of the Court (Gavan Duffy and Rich JJ.) considered that the material in the special case was inadequate for the determination of the issue which it raised and refrained from expressing any conclusion about whether the Queensland Government was liable for the negligence of its employed pilot in the circumstances of that case.
3. When the matter finally came before the Privy Council after the trial of
the action, their Lordships, while accepting Barton
A.C.J's formulation of the
relevant question, rejected the answer which he and Powers J. had given to it.
Their Lordships accepted
the contrary approach of Isaacs J. in this Court.
The starting point of that approach was the special status of a licensed pilot
appointed to a port. That special status of port pilots was well-established
("old and familiar": (1916) 2 A.C., at p.562). It
had been examined and
explained in judgments in previous cases from which some relevant general
propositions could be extracted.
The most important of those propositions had
been summarized by Isaacs J. ((1913) 17 C.L.R., at p.180) by reference to the
opinions
of the learned Judges who had constituted the Court of Sessions in
Holman v. Irvine Harbour Trustees (1877) 4 R. (Ct. of Sess.) 406:
"a licensed pilot is an independent public officer,and
the granting of the licence being his 'appointment'
and constituting him 'duly qualified';"
"'... a pilotage authority, having duly licensed a
pilot, is not responsible for any fault he may
commit. The licensing of a pilot is the
appointment of a public officer.'"
4. In Fowles their Lordships pointed out (at p.561) that it was clear that
the fact that pilotage was compulsory did not make the
Government liable for
the pilot's negligence. That being so, any liability of the Government "must
be on the ground that they charge
pilotage rates, which go into the Treasury,
that they pay salaries to the pilots, whom they choose, dismiss, or reprimand,
and that
they class them in the Civil Service and supply them with boats,
implements, and crews; also that they make regulations which control
them,
but not regulations interfering with their conduct and management of ships"
(at p.562). Their Lordships expressed the view
that those considerations
would be "very cogent" if the crucial question had been whether or not the
pilot was "in the service of
(the Government), as might arise in an action of
wrongful dismissal" (at p.562). They concluded, however, that where the
question
was, as they held it to be, whether or not "the defendants (scil. the
Government) were bound to navigate the ship and employed (the
pilot) to do for
them the work which they were bound to do", it was not conclusive to say that
the pilot "was in their service unless
it can also be said that the Government
were 'the principals in the piloting of ships,' to borrow the happy phrase of
Isaacs J."
(at p.562). Their Lordships concluded (at pp.562-563) that it
could not be said that the pilot's employer, as distinct from the
pilot
himself, was a principal in the piloting of ships.
5. As the generality of the statements to be found in the conflicting
judgments in this Court and in the judgment of the Privy Council
make plain,
the basis of the Judicial Committee's decision in Fowles extended beyond the
particular legislative provisions and facts
involved in that case. That basis
was that the "old and familiar status" of a licensed pilot in a port where
pilotage was compulsory
was such that the functions which the pilot performed
were properly to be seen as functions which were entrusted to him as a
designated
principal and which fell outside the ambit of any vicarious
liability of his general employer. As their Lordships said (at p.562):
"... the original status of a pilot, ... is, in
effect, that he must be regarded as an independent
professional man in discharging his skilled duties.
If it had been intended to alter this old and
familiar status, it is to be supposed that the
Legislature would have done it more explicitly."
6. While one can point to distinctive characteristics of the legislative and
factual context, the present case appears to me to
fall within the wide scope
of the reasoning of the Privy Council in Fowles. It follows that I consider
that the learned primary
judge and the majority of the Full Court were correct
in their view that acceptance of the binding authority of that reasoning, if
it be left unconfined, leads to the conclusion that the respondent Harbour
Company was not vicariously liable for the negligence
of a licensed pilot in
the port of Dampier in the performance of his function of piloting a ship of
another within the port notwithstanding
that the pilot was employed and paid
by the Harbour Company to perform that very function. That being so, it
becomes necessary to
consider whether the full sweep of the Judicial
Committee's reasoning in Fowles should continue to be accepted in this
country. That
question was not seen as an open one in the courts below. It
is, however, open in this Court.
7. On the one hand, one must be conscious of the ordinary undesirability of declining to accept the effect of the reasoning underlying a decision of an ultimate court of appeal which has stood as authority for nearly seventy years in a specialised field of commercial activity. Commercial arrangements, including insurance cover, have, no doubt, been made and negotiated on the basis that Fowles established that a harbour authority is ordinarily not liable for the negligence of an employed licensed pilot in the actual performance of his piloting functions in a port where pilotage by a licensed pilot is made compulsory by statutory provision notwithstanding that "they (i.e. the particular harbour authority) charge pilotage rates, ... that they pay salaries to the pilots, whom they choose, dismiss, or reprimand, and that they ... supply them with boats, implements, and crews" (see Fowles (1916) 2 A.C. 556, at p.562). The considerations which militate against the judicial overruling of the reasoning underlying such a long-standing authority have been canvassed in many cases and learned writings and need not be repeated here (see, e.g., Geelong Harbor Trust Commissioners v. Gibbs Bright & Co. (1974) AC 810, at pp 818-819; Morgans v. Launchbury [1972] UKHL 5; [1972] UKHL 5; (1973) AC 127, at p 137; Lord Devlin, "Judges and Lawmakers", Modern Law Review, vol.39 (1976), 1, at pp.10-11; but cf., e.g., William O. Douglas, "Stare Decisis", Columbia Law Review, vol.49 (1949), 735, at pp.735-736, 747).
8. On the other hand, the proposition that a general employer, be it public instrumentality or private company, is not vicariously liable for the negligence of the licensed pilots in its employ in carrying out the piloting duties which it employs and pays them to perform and for which the employer charges fees to the shipping owner is one which lies ill indeed with the ordinary principles governing vicarious liability in tort which, however uncertain they may have been in 1916 when Fowles was decided in the Privy Council, are now incontrovertible. In particular, the importance which Isaacs J. in this Court (at p.181) placed upon "the principle that the alleged servant must be completely under the control and at the disposition of the alleged master before the latter can as such be held liable for the negligence of the former" and the emphasis which the Privy Council placed (at p.562) upon the status of a pilot as "an independent professional man ... discharging his skilled duties" plainly indicate insistence upon a degree of control as a prerequisite of an employer's vicarious liability in tort which is simply inconsistent with contemporary law. The specialist employee - be he engineer, architect, lawyer, computer operator, airline pilot, ferry master or taxicab driver - has become almost as much the rule as the exception. He frequently performs his duties as an employee under the authority of a personal statutory licence. His specialist knowledge will commonly be such that it will be impracticable for his employer to do more than satisfy himself about, and rely upon, the qualifications, experience and reputed competence of the employee as a trained and licensed expert in the particular field. Nonetheless, the law is now clear that such a general employer will ordinarily be vicariously liable for such an employee's negligence in the course of the ordinary discharge of the duties of his employment.
9. If the reasoning in Fowles was open to criticism only on the ground of its discordance with the general principles governing vicarious liability for the tortious action of an employee, I would have inclined to the view that its authority should be left undisturbed even in the area where it is weakest, namely, where, as in the present case, the negligence is that of a licensed pilot in the employ of a non-government trading corporation in a port where pilotage is compulsory. The reasoning in Fowles is, however, open to criticism on the further ground that serious practical injustice could well flow from its application. Any such practical injustice may be more superficial than real in a case such as the present where what is involved is liability to a shipping company or the corporate owner of a port facility since the relationship between such corporations and the general employers of the pilots whose services they utilize or whose activities involve the use of such facilities is, even though pilotage is compulsory, amenable to definition by contractual arrangements between them and the presence or absence of vicarious liability in a general employer is likely to be reflected in pilotage rates and the extent of insurance cover. Where such practical injustice is likely to be of real substance is in the case of those who have neither the opportunity nor the economic standing to negotiate with the general employer of the licensed pilots of a port and who are likely to be uninsured against the injury to person or property which may be sustained as a consequence of the negligence of such pilots in the performance of their ordinary duties. A child in a pleasure boat which is overrun, a passenger on another ship who suffers injury in a collision, a person who is injured when a wharf on which he is standing is rammed provide some obvious examples. It would, so it seems to me, be quite contrary to ordinary notions of justice if such an injured party were unable to obtain redress from the trading corporation whose employed pilot had caused the injury by his negligence in the course of his ordinary duties performed for reward to the trading corporation merely by reason of the facts that pilotage in the port was compulsory and that the pilots in the port were appointed or licensed by the Crown or some government instrumentality. If that were so, such an injured party would, apart from the insignificant amount which (under understandable statutory limits) could be obtained from the pilot, be left to seek redress either from a ship which, if it was not on the bottom of the port, may well have long since departed the country or from a shipping owner who may well be in some foreign land whose laws are framed to afford maximum protection to those whose ships fly its flag.
10. The general approach appropriate to these circumstances is, in my
respectful view, that suggested by Lord Loreburn L.C. in
West Ham Union v.
Edmonton Union (1908) AC 1, at pp 4-5:
"Great importance is to be attached to oldAdopting that approach, I have come to the view that, on balance, the reasoning and decision of the Judicial Committee in Fowles should, at the very least, be confined in one respect to the particular facts of that case, namely, to the situation where the employer of a licensed port pilot is either the Crown or some government instrumentality. In particular, Fowles should not be treated as applying to a case such as the present where the employer is a trading corporation which employs the licensed port pilots to provide pilotage services to others for reward to itself. I shall briefly explain my reasons for that conclusion.
authorities, on the strength of which many
transactions may have been adjusted and rights
determined. But where they are plainly wrong, and
especially where the subsequent course of judicial
decisions has disclosed weakness in the reasoning
on which they were based, and practical injustice
in the consequences that must flow from them, I
consider it is the duty of this House to overrule
them ... "
11. As has been seen, the Privy Council's decision in Fowles was expressly based upon the "original status of a pilot" which was described as being, in effect, "that he must be regarded as an independent professional man in discharging his skilled duties" (at p.562, underlining added). Their Lordships made plain (see pp.560,562) that they saw that "original status" as predating the appointment of pilots by the Crown and the employment of pilots in the public service and that the question whether the licensed pilot in that case was appointed by the Crown or "was in the service of the defendants" (i.e. the Crown or "Government") was simply not in point. That being so, the decision in Fowles cannot properly be seen as resting upon the status of the particular pilot as an appointee or servant of the Crown or Government. Nonetheless, once one moves away from the case where the licensed pilots in a port are employees of the Crown or some government instrumentality, the authority of Fowles is greatly weakened. The reason is that, probably because of the references in their Lordships' judgment to the fact that the particular pilot was appointed and remunerated by the Government, the decision in Fowles has tended to be subsequently seen and explained as turning upon the status of the particular pilot as a "public officer" or "servant of the Crown". Thus, in Field v. Nott [1939] HCA 41; (1939) 62 CLR 660, Starke J. (at p 672) and Dixon J. (at p 675) each cited Fowles as authority for the proposition that "(w)hen a public officer, although a servant of the Crown, is executing an independent duty which the law casts upon him, the Crown is not liable for the wrongful acts he may commit in the course of his execution" (per Dixon J., at p 675). Again, in Little v. The Commonwealth [1947] HCA 24; (1947) 75 CLR 94), Dixon J., in considering a question of vicarious liability for the actions of police officers in the service of the Crown, referred (at p.114) to Fowles as one of the authorities establishing "the doctrine that any public officer whom the law charges with a discretion and responsibility in the execution of an independent legal duty is alone responsible for tortious acts which he may commit in the course of his office ..." (see also Attorney-General for N.S.W. v. Perpetual Trustee Co. (Ltd.) [1952] HCA 2; (1952) 85 CLR 237, at pp 265, 301; and note Ramsay v. Larsen (1964) 111 CLR 16, at p 26). True it is that there are some obvious difficulties involved in sustaining the decision in Fowles on that basis even in a case where a licensed pilot is a servant of the Crown in that, in a modern context, it somewhat strains reality to treat every licensed pilot in the employ of some government department or instrumentality in a port where pilotage is made compulsory by law as a "public officer" of the type described in the above extracts from judgments in this Court. Be that as it may, it would, in my respectful view, be contrary to both reality and common sense to treat a licensed pilot who is employed by a private trading company to perform the pilotage services which that company provides for reward in such a port in circumstances such as those of the present case as such a public officer merely because his appointment or licence as a port pilot was made or granted by the Crown or some government instrumentality or authority.
12. It should not be inferred from the above that I would leave the authority of Fowles undisturbed even in a case where the negligent pilot is employed by the Crown or by a government instrumentality. As I have indicated, there is room for arguing that it is unreal to see the role of a licensed pilot in a case such as Fowles as being that of a public officer entrusted with the performance of public duties in the sense referred to by Starke J. and Dixon J. in Field v. Nott and by Dixon J. in Little v. The Commonwealth and that the existence and extent of the liability of the Crown or a government instrumentality for the negligence of a pilot in its employ should be determined by reference to the principles of law and statutory provisions which govern the liability of the Crown or a government instrumentality for the negligence of an ordinary employee in a trading activity which is carried on for reward. Those are, however, questions which do not arise here and it is unnecessary that I express any view in relation to them.
13. Subject to the foregoing, I agree, for the reasons which he gives, with the following conclusions of Brennan J: (i) that, notwithstanding the provisions of s.410B of the Navigation Act 1912 (Cth), the respondent Pilbara Harbour Services Pty. Ltd. was vicariously liable in tort to Hamersley Iron Pty. Ltd. for the damage caused by the negligence of Captain Hammonds; (ii) that, that being so, the appellant Oceanic Crest Shipping Company was entitled to claim contribution from Pilbara Harbour Services Pty. Ltd. pursuant to s.7(1)(c) of the Law Reform (Contributory Negligence and Tortfeasors' Contribution) Act 1947 (W.A.); and (iii) that any problem occasioned by the existence on the record of the judgment in Pilbara's favour against Hamersley can, and in the circumstances should, be overcome in the manner which Brennan J. suggests.
14. I agree with the orders proposed by Brennan J.
DAWSON J.: I have had the advantage of reading the reasons for judgment of Brennan J. and am indebted to him for his recitation of the facts and for his analysis of the issues in this case. They enable me to go straight to the question which, as he demonstrates, must determine the outcome of this appeal.
2. That question is whether the appellant Oceanic Crest Shipping Company ("Oceanic"), which is the owner of the ship "Oceanic Crest", is entitled to claim contribution against the respondent Pilbara Harbour Services Pty Ltd ("Pilbara") under s.7(1)(c) of the Law Reform (Contributory Negligence and Tortfeasors' Contribution) Act 1947 (W.A.) in respect of the damage suffered by Hamersley Iron Pty Ltd ("Hamersley") to its harbour installation. The damage was caused by the negligent pilotage of the "Oceanic Crest". The pilot, whose services were compulsory by statute, was Captain Hammonds, an employee of Pilbara.
3. Section 7(1)(c) is in common form and provides that where damage is suffered by any person as the result of a tort any tortfeasor liable in respect of that damage may recover contribution from any other tortfeasor who is or would if sued have been liable in respect of the same damage. The question thus becomes whether Pilbara was liable to Hamersley by reason of the negligence of its servant, Captain Hammonds.
4. The answer to that question is in my view provided by s.410B of the
Navigation Act 1912 (Cth) which provides:
"(1) A pilot who has the conduct of a ship is
subject to the authority of the master of the ship
and the master is not relieved from responsibility
for the conduct and navigation of the ship by
reason only of the ship being under pilotage.
(2) Notwithstanding anything contained in a law of
the Commonwealth or of a State or Territory, the
owner or master of a ship navigating under
circumstances in which pilotage is compulsory under
a law of a State or Territory is answerable for any
loss or damage caused by the ship, or by a fault of
the navigation of the ship, in the same manner as
he would if pilotage were not compulsory."
5. It is under sub-s.(2) of that section that Oceanic has been held liable to
Hamersley upon the basis that it is answerable for
the damage caused by the
"Oceanic Crest" and, as I see it, the crucial question in this appeal is
whether the same sub-section excludes
liability on the part of Pilbara for the
negligence of its servant, Captain Hammonds, in the course of his employment.
I have come
to the conclusion that it does and it is therefore strictly
unnecessary for me to reach any final view whether, apart from s.410B, Pilbara
would be vicariously liable for the negligence of Captain Hammonds. However,
I have had the advantage of reading the reasons
for judgment of Wilson J., and
I accept the view which he expresses, namely, that this case is
indistinguishable from Fowles v. Eastern
and Australian Steamship Company,
Limited (1916) 2 AC 556 and that there is no sufficient reason to justify this
Court departing
from that decision. Thus, in addition to the effect of
s.410B, there is in my view another reason why there is no vicarious liability
on the part of Pilbara for Captain Hammonds' negligence.
6. In Fowles' Case the compulsory pilot was employed by the Government of Queensland, that is, the Crown, but was regarded as occupying a public office in which he discharged his duties as a pilot independently and not in the course of his employment. Having regard to the citation of Fowles' Case by Dixon J. in Field v. Nott [1939] HCA 41; (1939) 62 CLR 660, at p 675, and in Little v. The Commonwealth [1947] HCA 24; (1947) 75 CLR 94, at p 114, it is clear that he regarded the pilot as an example of a public officer who, although a servant of the Crown, was executing an independent duty which the law cast upon him so that the Crown was not liable for wrongful acts committed by him in the course of his doing so. The constable is the most familiar example of a public officer of this sort and Enever v. The King [1906] HCA 3; (1906) 3 CLR 969 perhaps the most familiar authority on the point.
7. Whether there is a distinction to be drawn when a constable - or a pilot - is privately employed giving rise to the result that the employer might be held liable for acts which would otherwise be performed independently, raises a question of some difficulty: Goff v. The Great Northern Railway Company [1861] EngR 316; (1861) 3 El. & El. 672 (121 ER 594); Edwards v. Midland Railway Company (1880) 6 QBD 287; Lambert v. Great Eastern Railway Company (1909) 2 KB 776; Fisher v. Oldham Corporation (1930) 2 KB 364. But in this case it is in my view not possible to regard Captain Hammonds as having been privately employed by Pilbara in such a way as to exclude the independent exercise of his functions as a pilot. He was appointed by the Governor of the State to be a pilot at the port of Dampier. There were the arrangements, described by Wilson J., under which first Hamersley and then Pilbara as its assignee were able to nominate Captain Hammonds for the appointment and to receive in respect of his services the benefit of pilotage rates levied under the Shipping and Pilotage Act 1967 (W.A.). Moreover the Government of Western Australia did not relinquish its final responsibility for the superintendence of vessels entering and leaving the port and for the provision of properly qualified pilots to enable them to do so. For the time being it carried out its responsibility through Hamersley or Pilbara, but that does not suggest that Pilbara undertook to provide something which the Government would not.
8. Neither Pilbara nor the Government were in the business of piloting ships and Pilbara's responsibility to Oceanic was discharged when it provided a competent pilot, appointed by the Government, in the person of Captain Hammonds. Such a conclusion is not only required by Fowles' Case but is supported by other authority: Holman v. The Irvine Harbour Trustees (1877) 4 Sess. Cas. (4 Ser.) 406; Otago Harbor Board v. Cates (1884) 2 NZLR 123; Actieselskabet Bannockburn v. Williams (1912) 12 SR (NSW) 665; City of Los Angeles v. Standard Transportation Company (1929) 3 Fed. Rep. (2d) 988. Whilst it is not impossible to conceive of a company formed for commercial purposes such as Pilbara, undertaking through its servants the business of actually piloting ships, when one has regard to the circumstances in this case it is clear to my mind that Pilbara did not purport to provide a service which was different in kind to that which would otherwise have been provided by the government itself or an appropriate statutory authority.
9. No doubt in Fowles' Case and the other cases, absence of control was a significant factor in establishing the independent status of a pilot employed by the Crown or a harbour authority or its equivalent. But it is absence of control in a different or more fundamental sense than the practical absence of control which recent cases reject as a decisive indication that there is no relationship of master and servant. There is a difference between absence of control which, in the case of the pilot, arises from the fact that his status does not permit it and absence of control which, in the case of other employees, stems from the fact that the employer lacks the skill or training necessary to exercise control. True it is that in a technologically complex world the relationship of master and servant may exist notwithstanding the inability of an employer to exercise control over the manner in which a skilled employee performs his work (see Montreal v. Montreal Locomotive Works Ltd. (1947) 1 DLR 161, at p 169; Stevens v. Brodribb Sawmilling Co. Pty Ltd [1986] HCA 1; (1986) 60 ALJR 194, at p 202; [1986] HCA 1; 63 ALR 513, at p 526), but in those circumstances it is the practicality of the situation which robs the absence of control of its significance rather than anything else. It is not so much that there is no right of control, but that it is practically impossible to exercise it because of the skill involved, except in incidental matters: Zuijs v. Wirth Brothers Pty. Ltd. [1955] HCA 73; (1955) 93 CLR 561, at p 571. On the other hand, in the case of a pilot in the general employ of the Crown or a harbour authority or its equivalent, it is the very nature of the relationship and of the status conferred upon the pilot which is inconsistent with the exercise of control by his general employer over the manner in which he carries out his actual duties as a pilot.
10. The relationship is quite different, or at least the law regards it as
being so, between the owners of a vessel and a pilot
voluntarily employed by
them and a clear distinction was, until it was removed by statute, drawn
between a pilot voluntarily employed
and one employed under compulsion. Dr
Lushington in The "Maria" [1839] EngR 1025; (1839) 1 W. Rob. 95, at pp.107-108 [1839] EngR 1025; (166 E.R. 508, at
p.513) put it
thus:
"If the taking a pilot on board was compulsory, and
the collision was occasioned by the fault of that
pilot, I shall hold the owners of the 'Maria'
exempt from responsibility, upon general principle,
without reference to Acts of Parliament, for in
that case the pilot was not their servant, and the
maxim qui facit per alium facit per se, does not
apply. If, on the contrary, the taking a pilot was
voluntary, then he was the servant of the owners,
and the owners are responsible ..."
11. The common law applied the maxim respondeat superior when a pilot was
voluntarily taken on board because he was selected by
or on behalf of the
owners and there was between them and the pilot a contractual relationship of
master and servant to which the
maxim was applicable. Where a pilot was taken
on board because of a statutory compulsion, there was no choice and no such
relationship
and for that reason the owners were said not to be responsible
for the pilot's acts. See Steamship "Beechgrove" Company, Limited
v.
Aktieselskabet "Fjord" of Kristiania (1916) 1 AC 364 at p 382; The Towerfield
(1949) P 10 at pp 22-23.
12. The common law position was expressed in s.633 of the Merchant Shipping
Act, 1894 (U.K.), a section which was superseded by
s.15 of the Pilotage Act
1913 (U.K.). It was upon s.15(1) of the Pilotage Act that s.410B(2) of the
Navigation Act was based. Section
633 provided:
"An owner or master of a ship shall not beSee The Hector (1883) 8 P.D. 218, at p.224; The "Halley" (1868) L.R. 2 P.C. 193; The "Maria".
answerable to any person whatever for any loss or
damage occasioned by the fault or incapacity of any
qualified pilot acting in charge of that ship
within any district where the employment of a
qualified pilot is compulsory by law."
13. Section 15 of the Pilotage Act, which came into force in 1918, was enacted for the purpose of abolishing the defence of compulsory pilotage and to bring the law of England into line with the law of other countries in accordance with Article 5 of the International Convention for the Unification of Certain Rules of Law in Regard to Collisions (signed at Brussels, 23 September 1910). It was intended to have the effect of repealing s.633 of the Merchant Shipping Act 1894. In saying that the owner is answerable for any loss or damage caused by the vessel or by any fault of the navigation of the vessel, in the same manner as he would be if pilotage were not compulsory, the section has been held to do more than merely shift liability. It has been held to create statutorily the relationship of master and servant between the shipowner and the pilot as if the pilot had been voluntarily employed by the shipowner.
14. In The Towerfield in the Court of Appeal at p.23, Bucknill L.J., whose
views were accepted on appeal to the House of Lords,
(1951) A.C. 112, said:
"So far as I know it has never been argued eitherIn The Towerfield, a case of compulsory pilotage, it was held in the House of Lords that the effect of s.15 was to render the shipowner responsible so that he was both liable for the loss and damage caused to others and precluded from recovering any loss which he had suffered by reason of damage to his ship. In Thom v. J. & P Hutchison Ltd (1925) SC 386 the First Division of the Court of Session upheld, upon the basis of s.15(1), the Scottish equivalent of the defence of common employment in an action by the representatives of a ship's engineer, who had drowned, against the owners. The ship had foundered because of the negligence of a compulsory pilot who was held, by reason of s.15(1), to be in common employment with the deceased engineer so as to preclude the recovery of damages.
in the Admiralty Court or in the Commercial Court
during the thirty years that have passed since 1918
that the object of s.15 was not to get rid of
compulsory pilotage altogether as a defence; in
other words it has always been assumed that s.15,
sub-s.1, put on the shipowner the same
responsibility for the acts of a compulsory pilot
as he has always had for the acts of a voluntary
pilot, 'namely a contractual relation of service,
to which the maxim of respondeat superior directly
applies' as Lord Atkinson said in his speech in The
Beechgrove."
15. There is no relevant difference between s.15(1) of the Pilotage Act and s.410B(2) of the Navigation Act and to depart from the view of the former section taken in the cases to which I have referred would be to create uncertainty in an area of law which has for a considerable time been regarded as settled. It is implicit in that view that under s.15(1) a compulsory pilot must, for the purpose of imposing responsibility for loss or damage caused by his pilotage, be regarded as the servant of the shipowner. The vicarious liability imposed by the section is as if the pilotage were not compulsory, that is, as if it were voluntary. That means, fiction though it might be, that the position of the compulsory pilot as regards the owner is one in which the maxim respondeat superior applies, necessarily excluding the responsibility of some other person upon the same basis.
16. The result is that, by reason of the principles expounded in Fowles' Case and by reason of s.410B(2) of the Navigation Act, Pilbara cannot be regarded as a tortfeasor in relation to the damage suffered by Hamersley and that there can therefore be no claim for contribution against Pilbara by Oceanic.
17. I would dismiss the appeal.
ORDER
Appeal dismissed with costs.
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