End of the line: Parkerville bushfire decision

The High Court of Australia has delivered judgment in favour of the plaintiffs in the Parkerville bushfire litigation. Matt McDonald and Liam Campion led a Hall & Wilcox team, acting for a large group of insured plaintiffs and their insurers in two of the four proceedings, heard concurrently.

In a landmark decision, the High Court unanimously upheld the Western Australian Court of Appeal’s decision that the electricity network operator was liable for the losses suffered by the plaintiffs as a result of the Parkerville bushfire.

Power pole’s condition

The Parkerville bushfire started on 12 January 2014 when a privately owned jarrah power pole failed due to age, fungal rot and termite damage, bringing down a live conductor with it. The plaintiffs sued the network operator (Western Power), its contractor (Thiess), as well as the person who owned the property and the pole. It was common ground that the timber pole was more than 30 years old and had never been maintained, inspected or treated over the course of its life, either by Western Power or by the landowner.

Approximately six months before the Parkerville bushfire, Western Power appointed Thiess to carry out works on its distribution line. This involved detaching and reattaching a service cable from and to the pole. Thiess claimed that during the course of these works, it conducted a thorough inspection of the pole, and it was structurally sound and safe for continued service. That evidence was rejected by the trial judge.

Prior judgments

We have previously reported on the decisions of Supreme Court of Western Australia and the Western Australian Court of Appeal. In 2021, the Court of Appeal held that all three defendants were liable to the plaintiffs at common law. Western Power and the landowner sought special leave to appeal to the High Court. The High Court dismissed the landowner’s application for special leave but granted leave to Western Power on the following grounds of appeal:

• whether the network operator had the requisite degree of control over the consumer-owned pole in order to owe a duty of care in relation to the pole; and
• whether a common law duty of care was inconsistent or incoherent with the statutory scheme.

The High Court dismissed both grounds of appeal. While it is an established principle that a statutory authority, such as Western Power, does not generally owe a common law duty of care to exercise a statutory power, this case this did not concern Western Power’s omission to exercise a power, but rather the duty of care that is owed when a statutory authority does exercise a power.

It was not merely the case that Western Power failed to exercise its power to maintain the electricity pole over many years. It ‘entered the arena’ by exercising specific statutory powers in the course of undertaking, operating, managing and maintaining its electricity distribution system. This included Western Power connecting the landowner’s premises to its distribution system by affixing its own apparatus (namely, its service cable, fuses and meter) to the pole and then energising the landowner’s premises.  Thereafter, Western Power continued to use the apparatus for the purpose of its distribution system, in a continuous exercise of its statutory powers.

Duty of care

Having exercised such statutory powers, Western Power placed itself into a relationship through which it owed a common law duty of care to the plaintiffs in the manner in which it exercised those powers. This is because, by exercising those powers, Western Power created or increased the risk of harm to the plaintiffs – the risk of the pole collapsing and causing a fire by the discharge of electricity.

Western Power’s appeal incorrectly focused on ownership of the pole and its own lack of physical control over the pole. However, that was not the risk of harm.

The risk of harm was the result of the network operator actually exercising its statutory powers in the supply of electricity. Put simply: were it not for Western Power’s actions, a live powerline would not have been held aloft by the rotten pole. Accordingly, Western Power had control over the risk of harm and it owed a common law duty to take reasonable care in the exercise of its powers. That common law duty operated concurrently with any obligations imposed by statute, and was compatible with the powers conferred upon Western Power by statute.

High Court decision and implications

The High Court therefore upheld the finding that Western Power owed a common law duty of care in its exercise of its statutory powers. As breach of duty was not appealed, Western Power remains liable for 50% of the losses caused by the Parkerville bushfire, with Thiess liable for 35% and the landowner 15%.

This unanimous decision provides much needed clarity as to the circumstances in which a statutory authority will be found to owe a common law duty of care. The principle is clear: once a statutory authority ‘enters the field of activity’ by actually exercising a statutory power, it may place itself in a relationship to others where a common law duty of care attaches to the manner in which it exercises those powers.