SUTHERLAND SHIRE COUNCIL v HEYMAN

157 CLR 424
60 ALR 1

---

(Decision by: BRENNAN J)

SUTHERLAND SHIRE COUNCIL
v HEYMAN

Court:

Judges: Gibbs C.J.
Mason J.
Wilson J.

Brennan J.Deane J.

Subject References:
Negligence
Local Government (NSW)

Judgment date: 4 July 1985

CANBERRA

---

Decision by:
BRENNAN J

A house was built at 14 Bridgeview Road, Engadine, within the Shire of Sutherland. In 1975, some time after the building of the house was completed, the respondents bought the property and went into occupation. They had not sought any report on the structural stability of the house before they bought it. During 1976 they discovered that some parts of the house, especially the floor beams, were distorted, walls were damaged and cracks had appeared. The cause of these defects was the settlement of foundations beneath the footings of several of the supports at the rear of the house. The rear of the house was elevated and the footings, constructed in loose material of questionable stability, were inadequate. It does not appear whether the previous owner or owners of the property knew that the footings were inadequate. The number of footings constructed were fewer than those shown on the approved plans. The Council had approved the plans and specifications when it issued a building permit but the plans and specifications did not contain details of the kind of foundations on which the footings ought to have been constructed. Robson D.C.J. in the District Court of New South Wales found:

"Neither the approved plans and specifications nor the provisions of any relevant ordinance provided sufficient detail or guidance to ensure that such stability and efficiency of footings were achieved.

Competent supervision and examination was required when foundation trenches were open before the foundations were laid and the construction of footings was commenced.

The builders were negligent in failing to ensure that foundations and footings in relation to a number of the brick piers and steel pipes were constructed in places for the necessary support of the house."

While the house was being built, it was inspected by one or more officers of the appellant Council's building section. The number of inspections was a matter of controversy. The better view, adopted by the Court of Appeal, is that the building was inspected only once, on 3 December 1969, when the frame of the house was in position. There was some carelessness in the inspection of the house while it was under construction. The foundations and footings may not have been inspected at all, or it may not have been discovered that the footings were constructed on unstable and insecure foundations, or the builder may not have been told on what foundations the footings should be constructed.

The respondents sued the Council in the District Court for damages for common law negligence. Particulars of the alleged negligence were pleaded in these terms:

"(i)

Failed to exercise properly and with reasonable care its powers under the Local Government Act.

(ii)

Failed to insure that the provisions of the Local Government Act and ordinances made thereunder were complied with.

(iii)

Failed to insure that the foundations of the said building were adequate and stable.

(iv)

Approved plans for the erection of a building the foundations of which were inadequate and unstable and did not comply with the provisions of the Local Government Act and ordinances made thereunder.

(v)

Failed to appoint competent inspectors for the purpose of insuring that the foundations were stable and adequate and complied with the Local Government Act and ordinances made thereunder.

(vi)

Failed to insure that the foundations of the said house were inspected properly or at all."

The respondents claimed the costs incurred in jacking up the house and constructing sound footings in lieu of the defective footings together with certain costs of repairs to the superstructure of the house and certain expenses incurred in connection therewith. Robson D.C.J. did not award damages for repairs to the superstructure but otherwise his Honour allowed the claim, awarding $7,922.93 damages (including interest). An appeal to the Court of Appeal was dismissed. The Council's statutory powers.

The Council's functions and powers with respect to building regulation are contained in Part XI of the Local Government Act 1919 (NSW) ("the Act") and in the Building Ordinance (then Ordinance No 71) made under the Act. Section 305(1) of the Act confers on a municipal council power to "control and regulate the erection of buildings in the municipality". Ordinances may be made for the purpose of carrying Part XI into effect (s 318) and the Building Ordinance was made for that purpose. The erection or use of a building "in contravention of the provisions made by or under this Act" is prohibited (s 306(1)). The Council's approval, which may be given subject to conditions, is required for the erection of a building (ss 311,314). In deciding whether to issue a building permit, the Council is required to take into consideration, inter alia, the stability of the proposed building and whether the site is likely to subside (s 313(b), (m)). The Council issued a building permit and approved the plans and specifications for the erection of the house subject to certain conditions. In pursuance of cl.4(h) of the Ordinance, the Council inserted a condition that 48 hours' written notice be given the Council before the laying of foundations in their trenches and before the filling in of the trenches. A further condition prohibited occupation without the Council's permission until the Council had "inspected and passed" the building after completion. Section 310 requires that every building that is erected

"shall be erected to the satisfaction of the council -

(a)

in conformity with this Act and the ordinances; and

(b)

in conformity with the application, plans, and specifications in respect of which the council has given its approval for the erection of the building."

Clause 14(d) of the Ordinance provides that "(e)very part of a building shall be erected in a good and workmanlike manner". The Council may order the opening, or cutting into, or pulling down of any work where the Council has reason to believe or suspect that anything has been done in contravention of the Act or of any Ordinance, and in the event of the work being found to have been done in contravention of the Act or of the Ordinances, the person doing the work shall be required to comply with the Act or the Ordinances (cl.82(a)). The Council is empowered to prohibit the use or occupation, without its permission, of any building until it is completed in accordance with approved plans and specifications (s 316, cl.83). An inspection must be made by the Council's inspector when a notice is received from the builder or owner on completion in order to determine whether the building has been erected in accordance with the Ordinance and without material deviation from the approved plans and specifications (cl.83). The doing of any work in connection with the erection of a building otherwise than in conformity with an approval is an offence (s 317). Section 317A of the Act provides for the furnishing of a certificate of the Council's opinion that a building either complies with the Act, the Building Ordinance and the approved plans and specifications, or that any contravention of the Act or Ordinance or any departure from the plans and specifications does not need to be rectified. Any person may apply for a s 317A certificate. No certificate of compliance under s 317A has ever been applied for or furnished in respect of the house at 14 Bridgeview Road. There was no evidence of the receipt by the Council of a notice before the footings were laid, a notice before the trenches were filled in or a notice of completion. There was no evidence of an inspection by the Council's inspector of the house after completion but before occupation. Nor is there any evidence of the giving of any permission to occupy.

Negligence by omission : the duty to act

The respondents' case is that the Council, invested with the statutory powers conferred by Part XI for the control and regulation of the erection of buildings, failed to exercise those powers with reasonable care whereby the respondents suffered damage. The damage consisted in physical defects in the structure of the house: distorted floor beams and defective footings. The footings were defective because the builder constructed them that way. That was the act which caused the damage which the respondents discovered in 1976 and in respect of which they claimed damages. If, during construction, the Council's inspectors had inspected the footings, discovered that the footings were inadequate, and had given advice as to the construction of adequate footings, or if the Council had enforced the prohibition on occupation until the footings were constructed in a good and workmanlike manner, the Council could have, or might have, prevented the damage of which the respondents complain.

The respondents' case succeeded before the Court of Appeal. Hope J.A. thought that the Council was under duties similar to those which the Borough Council was held to owe to future owners and occupiers in Anns v. Merton London Borough (1978) AC 728. His Honour said:

"The Council's conditions (i.e., conditions of approval of the plans and specifications) were validly imposed, and the Council had a duty to see that they, and the Act, were complied with. It had a power to make inspections, and may have had a duty to do so, even though the inspections (apart from the inspection required by cl.83 of Ordinance 71) resulted from the conditions which it imposed. The obligation of the Council to take reasonable care is emphasised by the requirement of s 310 that the building be erected to the satisfaction of the Council in conformity with the approved plans and specifications. In my opinion the relevant statutory background in New South Wales reinforces the case for adopting Anns rather than weakens it and it should be applied."

Reynolds J.A. agreed with Hope J.A. and said

"that the duties imposed upon a council in respect of the control and regulation of buildings confer a correlative private right owed to persons in the position of the respondents."

Presumably, his Honour regarded the statutory powers conferred by the Act as importing a statutory duty to exercise those powers with reasonable care. Both of their Honours found the Council in breach of a duty of care. Mahoney J.A. gave no reasons but agreed with the orders made.

The respondents seek to uphold the judgment of the Court of Appeal, relying on the well-known speech of Lord Wilberforce in Anns with which Lord Diplock, Lord Simon of Glaisdale and Lord Russell of Killowen agreed. That case reached the House of Lords on a preliminary point of law and was decided in the plaintiff's favour. The plaintiffs' case, distilled out of the pleadings, raised questions the first of which Lord Wilberforce stated as follows:

"1.

Whether the defendant council was under:

(a)

a duty of care to the plaintiffs to carry out an inspection of the foundations ...

(b)

a duty, if any inspection was made, to take reasonable care to see that the byelaws were complied with ...

(c)

any other duty including a duty to ensure that the building was constructed in accordance with the plans, or not to allow the builder to construct the dwelling house upon foundations which were only 2 feet 6 inches deep instead of 3 feet or deeper (as pleaded)."

The Council's functions were prescribed by the Public Health Act 1936 (UK) and the building by-laws made thereunder. The building was a block of flats. After the building was complete, structural damage appeared. In Anns, as in the present case, the structural damage to the building was the damage in respect of which damages were claimed. In both cases, that damage occurred because the foundations were unstable and insecure. In both cases, the negligence of the Council was said to consist in its failure to exercise its statutory powers with reasonable care. In neither case, however, were the defects in the footings or foundations caused by any act done by the Council. The negligence alleged in this case consists in omissions - a failure to act when action would or might have prevented the damage suffered by the plaintiff. Negligence by omission was also in question in Anns: a failure "to carry out an inspection", "to see that the byelaws were complied with", "to ensure that the building was constructed ..." or "not to allow the builder to construct ...". The question, common to both cases, is whether there was a duty not to make the omissions complained of or, putting the question in a positive form, whether there was a duty to act to prevent damage of the kind which the plaintiffs suffered.

In Anns, on the facts alleged in the pleadings, it was held (at p 758) that the Council was under a common law duty -

" ... to take reasonable care, no more, no less, to secure that the builder does not cover in foundations which do not comply with byelaw requirements. The allegations in the statements of claim, in so far as they are based upon non-compliance with the plans, are misconceived."

Lord Wilberforce found that such a duty, owed by a Council to future owners and occupiers of the building, arose out of the general principles of the law of negligence which he stated (at pp 751-752) in terms that are now familiar:

"Through the trilogy of cases in this House - Donoghue v. Stevenson (1932) AC 562, Hedley Byrne & Co Ltd. v. Heller & Partners Ltd. (1964) AC 465, and Dorset Yacht Co Ltd. v. Home Office (1970) AC 1004, the position has now been reached that in order to establish that a duty of care arises in a particular situation, it is not necessary to bring the facts of that situation within those of previous situations in which a duty of care has been held to exist. Rather the question has to be approached in two stages. First one has to ask whether, as between the alleged wrongdoer and the person who has suffered damage there is a sufficient relationship of proximity or neighbourhood such that, in the reasonable contemplation of the former, carelessness on his part may be likely to cause damage to the latter - in which case a prima facie duty of care arises. Secondly, if the first question is answered affirmatively, it is necessary to consider whether there are any considerations which ought to negative, or to reduce or limit the scope of the duty or the class of person to whom it is owed or the damages to which a breach of it may give rise."

The first stage is based, of course, on Lord Atkin's seminal phrases in Donoghue v. Stevenson (1932) AC 562, at p 580:

"You must take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour. Who, then, in law is my neighbour? The answer seems to be - persons who are so closely and directly affected by my act that I ought reasonably to have them in contemplation as being so affected when I am directing my mind to the acts or omissions which are called in question."

In Dorset Yacht Co. v. Home Office (1970) AC 1004, Lord Reid said (at p 1027) that this passage from Lord Atkin's speech should be regarded "as a statement of principle" which "ought to apply unless there is some justification or valid explanation for its exclusion". However, if Lord Wilberforce's first stage is intended to be applied in cases of non-feasance as well as in cases of misfeasance, it elides the distinction between acts and omissions which appears in Lord Atkin's language. Under the first stage, a prima facie duty of care is said to arise if, in the reasonable contemplation of the alleged wrongdoer, "carelessness" on his part - presumably either by act or by omission - may be likely to cause damage to another who comes to suffer that damage. With all respect, I am unable to see how the first stage, importing Lord Atkin's statement of principle, can be applied to determine whether a failure to act in exercise of a statutory power is negligent. The test of foreseeability of injury never has been applied as an exhaustive test for determining whether there is a prima facie duty to act to prevent injury caused by the acts of another or by circumstances for which the alleged wrongdoer is not responsible. Lord Diplock reminds us in Dorset Yacht, at p 1060:

"The branch of English law which deals with civil wrongs abounds with instances of acts and, more particularly, of omissions which give rise to no legal liability in the doer or omitter for loss or damage sustained by others as a consequence of the act or omission, however reasonably or probably that loss or damage might have been anticipated."

A man on the beach is not legally bound to plunge into the sea when he can foresee that a swimmer might drown. In Jaensch v. Coffey (1984) 58 ALJR 426; 54 ALR 417 Deane J. observed (at p 439; p 439) that -

"the common law has neither recognized fault in the conduct of the feasting Dives nor embraced the embarrassing moral perception that he who has failed to feed the man dying from hunger has truly killed him."

If foreseeability of injury were the exhaustive criterion of a duty to act to prevent injury occurring, the "neighbour" of the law would include not only the Biblical Samaritan but also the Priest and Levite who passed by the injured man. Windeyer J. commented on their relationship with the injured man in Hargrave v. Goldman (1963) 110 CLR 40 , at p 66:

"He obviously was a person whom they had in contemplation and who was closely and directly affected by their action. Yet the common law does not require a man to act as the Samaritan did. The lawyer's question must therefore be given a more restricted reply than is provided by asking simply who was, or ought to have been, in contemplation when something is done. The dictates of charity and of compassion do not constitute a duty of care. The law casts no duty upon a man to go to the aid of another who is in peril or distress, not caused by him."

If foreseeability of injury were the exhaustive criterion of a duty to act to prevent the occurrence of that injury, legal duty would be coterminous with moral obligation (see Smith and Burns, "Donoghue v. Stevenson - The Not So Golden Anniversary" (1983) 46 Modern Law Review, 147). Lord Atkin's definition of the person who is in law my "neighbour" is not so wide: it is a person who is affected "by my act", not by my omission. The judgment of Brett M.R. in Le Lievre v. Gould [1893] 1 QB 491 , at p 497 which Lord Atkin cites (at p 581) makes it clear that the general principle expresses a duty to take reasonable care to avoid doing what might cause injury to another, not a duty to act to prevent injury being done to another by that other, by a third person, or by circumstances for which nobody is responsible.

I can be liable only for an injury that I cause to my neighbour. If I do nothing to cause it, I am not liable for the injury he suffers except in those cases where I am under a duty to act to prevent the injury occurring. Indeed, he is not in law my neighbour unless he is foreseeably "affected" by my conduct. But he can be said to be "affected" by my omission to act to prevent injury being done to him only if I am bound to act and do not do so. He cannot be said to be affected by my omission to act if I am not under a duty to him to act. Lord Atkin's "neighbour" test involves us in hopeless circularity if my duty depends on foreseeability of injury being caused to my neighbour by my omission and a person becomes my neighbour only if I am under a duty to act to prevent that injury to him. Foreseeability of an injury that another is likely to suffer is insufficient to place me under a duty to him to act to prevent that injury. Some broader foundation than mere foreseeability must appear before a common law duty to act arises. There must also be either the undertaking of some task which leads another to rely on its being performed, or the ownership, occupation or use of land or chattels to found the duty (cf. Windeyer J. in Hargrave v. Goldman, at p 66).

Thus a duty to act to prevent foreseeable injury to another may arise when a transaction - which may be no more than a single act - has been undertaken by the alleged wrongdoer and that transaction - or act - has created or increased the risk of that injury occurring. Such a case falls literally within Lord Atkin's principle in Donoghue v. Stevenson. Where a person, whether a public authority or not, and whether acting in exercise of a statutory power or not, does something which creates or increases the risk of injury to another, he brings himself into such a relationship with the other that he is bound to do what is reasonable to prevent the occurrence of that injury unless statute excludes the duty. An omission to do what is reasonable in such a case is negligent whether or not the person who makes the omission is liable for any damage caused by the antecedent act which created or increased the risk of injury. Thus in Fisher v. Ruislip-Northwood U.D.C. and Middlesex C.C. [1945] KB 584 a local authority which, under statutory power, had erected an air raid shelter on a highway was held to be under a duty to take such steps to safeguard the public from colliding with the shelter at night as were reasonably open to the local authority in wartime (e.g., providing special danger lights). Sometimes omissions of this kind are difficult to separate from the antecedent act, and then the antecedent act may be said to be negligently done.

There is a distinction between a case where the repository of a statutory power does something which creates or increases the risk of foreseeable damage and that damage occurs and a case where a person is able to foresee that damage might occur but does nothing to cause it. In the first case, if he takes no reasonable steps to prevent the occurrence of the damage, he is negligent; in the latter, he is not. Fisher v. Ruislip-Northwood U.D.C. is an example of the first case; East Suffolk Rivers Catchment Board v. Kent (1941) AC 74 is an example of the latter. In that case, a wall was breached by an exceptionally high springtide and the plaintiff's land was inundated. The Board had a statutory power to repair the wall, but in undertaking the task it did not have or did not exercise reasonable skill. The plaintiffs' land remained inundated for longer than it would have been if the Board had exercised proper skill in repairing the wall. The plaintiffs failed. Viscount Simon L.C. concluded (at pp.87-88) that the Board -

"did not cause the loss; it was caused by the operations of nature which (the Board) were endeavouring, not very successfully, to counteract. It is admitted that (the plaintiffs) would have no claim if (the Board) had never intervened at all. In my opinion, (the plaintiffs) equally have no claim when (the Board) do intervene, save in respect of such damage as flows from their intervention and as might have been avoided if their intervention had been more skilfully conducted."

In Anns, Lord Wilberforce thought the East Suffolk case was a good example of a case where it was difficult to establish the common law duty of care because the repair of the wall was "well within a discretionary area" (at pp 756-757). That was not the explanation of East Suffolk given by McTiernan J. in Administration of Papua and New Guinea v. Leahy (1961) 105 CLR 6 , at p 12, where his Honour said that the Board in East Suffolk was held to be under no liability to the plaintiffs as the damage suffered by them was due to natural causes. Lord Wilberforce (at p 757) regarded the authority of East Suffolk as affected by the circumstance -

"that the conception of a general duty of care, not limited to particular accepted situations, but extending generally over all relations of sufficient proximity, and even pervading the sphere of statutory functions of public bodies, had not at that time become fully recognised."

He cites Lord Atkin's distinction in East Suffolk -

" ... between two kinds of duties:

(1)

A statutory duty to do or abstain from doing something.

(2)

A common law duty to conduct yourself with reasonable care so as not to injure persons liable to be affected by your conduct."

The assumption implicit in Lord Atkin's dissent in that case and Lord Wilberforce's speech in Anns is that "relations of sufficient proximity" give rise to a general duty to do something so as not to injure persons "liable to be affected by your conduct". Although a relationship of proximity can give rise to a general duty to "abstain from doing something", a duty to do something to prevent injury arises only when a statute imposes it or when one of the foundations mentioned by Windeyer J. in Hargrave v. Goldman exists. The inappropriateness of determining the existence of a duty to act to prevent injury by reference to a relationship of proximity alone appears in what Lord Reid said in Dorset Yacht:

" ... when a person has done nothing to put himself in any relationship with another person in distress or with his property mere accidental propinquity does not require him to go to that person's assistance. There may be a moral duty to do so, but it is not practicable to make it a legal duty."

Of course, if foreseeability of injury to another were the exhaustive criterion of a prima facie duty to act to prevent the occurrence of that injury, it would be essential to introduce some kind of restrictive qualification - perhaps a qualification of the kind stated in the second stage of the general proposition in Anns. I am unable to accept that approach. It is preferable, in my view, that the law should develop novel categories of negligence incrementally and by analogy with established categories, rather than by a massive extension of a prima facie duty of care restrained only by indefinable "considerations which ought to negative, or to reduce or limit the scope of the duty or the class of person to whom it is owed". The proper role of the "second stage", as I attempted to explain in Jaensch v. Coffey (at p 438; p 437), embraces no more than "those further elements (in addition to the neighbour principle) which are appropriate to the particular category of negligence and which confine the duty of care within narrower limits than those which would be defined by an unqualified application of the neighbour principle".

I turn to enquire, therefore, whether there are any grounds in addition to foreseeability of injury for holding that the Council was under a duty to the respondents to inspect the footings, to discover that they were constructed on unstable and insecure foundations, to tell the builder on what foundations the footings should be constructed, and to enforce the prohibition on occupation until the footings were constructed in a good and workmanlike manner. A duty to act to prevent the occurrence of damage of the kind complained of by the respondents might arise because Parliament impliedly imposed the duty when it conferred statutory powers on the Council or because the circumstances are such that a duty arises at common law from what the Council did in exercise of its powers. Statutory power as the source of statutory duty.

A statutory power is not the same thing as a statutory duty. Before the repository of a statutory power can be liable in negligence for a failure to exercise it, the statute must (either expressly or by implication) impose a duty to exercise the power and confer a private right of action in damages for a breach of the duty so imposed. The question whether Parliament has conferred a private right of action depends upon the interpretation of the statute. As Kitto J. said in Sovar v Henry Lane Pty Ltd (1967) 116 CLR 397 , at p 405:

"The intention that such a private right shall exist is not ... conjured up by judges to give effect to their own ideas of policy and then 'imputed' to the legislature. The legitimate endeavour of the courts is to determine what inference really arises, on a balance of considerations, from the nature, scope and terms of the statute, including the nature of the evil against which it is directed, the nature of the conduct prescribed, the pre-existing state of the law, and, generally, the whole range of circumstances relevant upon a question of statutory interpretation."

Although a general rule of law or a definite rule of construction are not always at hand and sufficient to illuminate fully the meaning of a statute, interpretation of a statute is not a matter of judicial policy (cf. per Dixon J. in O'Connor v S.P. Bray Ltd. (1937) 56 CLR 464 , at pp 477-478). It is a matter of parliamentary intention.

It was not submitted - and, in my view, rightly - that Parliament intended to confer on a purchaser of a building a private right of action for damages in respect of damage which the Council would or might have prevented by a careful exercise of its powers under Part XI of the Act. It may be inferred that the Part XI powers were conferred on the Council in order to maintain a reasonable standard of building construction within the Council's area - an objective the achievement of which is of benefit to the community generally by maintaining general amenities, to individual members of the community and particularly to occupants of buildings by preventing dangers to their safety and health, and to persons who have a proprietary interest in buildings by preventing the occurrence of structural defects. There is no duty imposed by the Act on the Council to achieve the objective and to confer the consequential benefits on the respective classes of beneficiaries. No doubt there is a duty in public law to exercise some Part XI powers (for example, the power to approve or to refuse approval for the erection of a building) but breach of a public law duty gives no private right of action (Wentworth v. Woollahra Municipal Council (1982) 149 CLR 672 , at pp 681-682).

Section 317A is the only provision in Part XI that imposes a duty (namely, a duty to furnish a certificate) that is for the benefit of future purchasers of buildings ( inter alios ) who apply for such a certificate. Although an intending purchaser of a building constructed since Part XI came into force might assume that the Council had exercised its powers under Part XI with reasonable care and that it was therefore likely that the building had been built in compliance with the Act, Ordinance, and approved plans and specifications, s 317A provides for the making of the only representation by the Council on which such a purchaser is entitled to rely. The Council is under a duty to intending purchasers to use reasonable care in furnishing the certificate, a duty that arises at common law (if it does not arise by statute) when the Council knows that reliance will be placed upon it: see Shaddock & Associates Pty Ltd v Parramatta City Council (No 1) (1981) 150 CLR 225 .

If the court ascertains from the Act and Ordinance that Parliament did not intend to impose on the Council any other duty to future purchasers of property, it is not open to the court to remedy a supposed deficiency by superimposing a general common law duty on the Council to prevent any damage that future purchasers of property might suffer in the event of a non-exercise or a careless exercise of their statutory powers. To superimpose such a general common law duty on a statutory power would be to "conjure up" the duty in order to give effect to judicial ideas of policy. The common law does not superimpose such a duty on a mere statutory power. That appears in the speeches in East Suffolk. Lord Romer said, at p 102:

"Where a statutory authority is entrusted with a mere power it cannot be made liable for any damage sustained by a member of the public by reason of a failure to exercise that power."

And Lord Porter said, at p 106:

"If those who are authorized but not enjoined to act could be successfully sued for a failure to exercise their power I should have thought it unlikely that they would undertake the permitted task, since to do so would be to invite an action at the suit of any person who considered that they had not acted with due vigour and care."

However, a duty of care sometimes devolves on an authority which exercises its statutory powers although it was under no duty to exercise its powers and would have been under no duty of care if it had not chosen to exercise them. The exercise of statutory powers as the source of common law duty.

The nature and scope of the common law duty of care owed by a public authority exercising statutory powers has been well-settled since Great Central Railway v. Hewlett [1916] 2 AC 511 . The rule was restated by this Court in Caledonian Collieries Ltd. v. Speirs (1957) 97 CLR 202 , at p 220:

" ... when statutory powers are conferred they must be exercised with reasonable care, so that if those who exercise them could by reasonable precaution have prevented an injury which has been occasioned, and was likely to be occasioned, by their exercise, damages for negligence may be recovered."

Thus, in accordance with Lord Atkin's principle in Donoghue v. Stevenson, a duty to act to prevent damage may arise from the undertaking by a statutory authority of a transaction that creates or increases a risk of injury (cf. per Lord Greene M.R. in Fisher v. Ruislip-Northwood U.D.C., at p 618).

The rule derived from Great Central Railway v. Hewlett accords with Lord Atkin's principle but modifies it to take account of the immunity conferred by statute in respect of the act or transaction out of which the duty of care arises. The obverse of the rule is that the statute gives a public authority exercising statutory powers immunity from liability only for those consequences of its acts which cannot be avoided by the exercise of reasonable skill and care (Benning v. Wong (1969) 122 CLR 249 , per Barwick C.J. at p 256; Allen v. Gulf Oil Ltd. (1981) AC 1001, at p 1011; Tate & Lyle v. Greater London Council [1983] 2 AC 509 , at pp 537-540). Liability for the consequences which can be avoided by the taking of some action or by some other exercise of reasonable skill and care depends on general principles. But a public authority is under a duty to take some action (whether in exercise of a statutory power or not) to prevent injury only if its antecedent acts (whether in the exercise of its statutory functions or not) have created or increased a risk of injury of that kind.

In Anns, there is a passage in Lord Wilberforce's speech which may suggest that a common law duty "superimposed" on a statutory power could give rise to a duty to act to prevent injury when the antecedent acts of the public authority have not created or increased any relevant risk of injury. His Lordship said:

"I do not think that it is right to limit this to a duty to avoid causing extra or additional damage beyond what must be expected to arise from the exercise of the power or duty. That may be correct when the act done under the statute inherently must adversely affect the interest of individuals. But many other acts can be done without causing any harm to anyone - indeed may be directed to preventing harm from occurring. In these cases the duty is the normal one of taking care to avoid harm to those likely to be affected."

If his Lordship meant only that a public authority when it is engaged in the performance of statutory functions that are not inherently dangerous may, on general principles, be under a general duty of care I would respectfully agree. But the "normal" duty of care cannot be a duty to exercise a statutory power to prevent injury to another, or otherwise to act in such a way as to prevent injury to him, unless Parliament has imposed such a duty or unless the authority has itself created or increased the risk of injury of that kind. In the absence of a statutory duty, a "normal" duty to exercise care cannot arise unless the acts actually done in exercise of a statutory power create or increase a risk of foreseeable injury to another, and then the duty is to do those acts with reasonable care and to take "reasonable precautions" to prevent that injury occurring. Thus in Birch v. Central West County District Council (1969) 119 CLR 652 the Council, an electricity authority, was held liable to a customer for damage sustained because of its failure to provide electricity at the normal voltage level when there was a known risk of damage created by the supply of electricity at the lower voltage level and that risk was avoidable by the exercise of reasonable skill and care. The duty of care arose from the Council's act in supplying electricity at what was known to be a dangerously low voltage rather than from its statutory obligation to supply (per Walsh J. at p 664). The duty depended on general principles, not on the provisions of the statute. Indeed, Barwick C.J. said (at p 659) that the duty of care was "unconnected with its statutory authority, or any duty derived from its constating statute". In Shaddock the performance of public functions by the Council was one of the circumstances which warranted a conclusion that the Council realized or ought to have realized that a person seeking information from the Council about town planning proposals intended to act upon the information given so that a duty of care arose in the giving of the information: see per Gibbs C.J. at pp 234-235; Stephen J. at p 242; Mason J. at pp 252-253. Again the duty of care arose not by reason of the statutory powers with which the Council was invested but because the Council had adopted a practice of providing information which it possessed as a planning authority and private persons were accustomed to seek and to act on the information provided.

In Shaddock, and perhaps in Birch (see p 664), the injury was caused not simply by a negligent exercise of statutory power but rather by the authority's failure to perform its functions in the way which the plaintiff had been led to expect. In like manner, a lighthouse authority would be under a duty to light its beacon lest ships might founder on the rock it was expected to mark. By inducing reliance on the continued performance of its statutory functions, a public authority may create or increase a risk of damage should the function be discontinued without notice. The speeches in East Suffolk did not acknowledge this basis of public authority liability, but there was no evidentiary foundation for raising a claim based on reliance in that case (nor, I think, in this).

I would not doubt that a public authority, which adopts a practice of so exercising its powers that it induces a plaintiff reasonably to expect that it will exercise them in the future, is liable to the plaintiff for a subsequent omission to exercise its powers, or a subsequent exercise of its powers, if the plaintiff has relied on the expectation induced by the authority and has thereby suffered damage provided that damage was reasonably foreseeable when the omission or inadequate exercise occurred and provided that any special element restricting a cause of action for negligence occasioning damage of that kind is satisfied. That principle might have had some attraction for the respondents in the present case, but the evidence did not warrant its invocation. In any event, for reasons presently to be stated, the respondents could not have asserted any reliance on the Council's performance of its functions in the absence of a s 317A certificate. A need to define the postulated duty.

Liability in tort is for damage done, not for damage merely foreseeable or threatened or imminent. The principle was stated by Viscount Simonds in delivering the judgment of the Judicial Committee in Overseas Tankship (UK) Ltd. v. Morts Dock & Engineering Co Ltd. (The Wagon Mound.) (1961) AC 388 ("Wagon Mound (No 1)"), at p 425:

"It is, no doubt, proper when considering tortious liability for negligence to analyse its elements and to say that the plaintiff must prove a duty owed to him by the defendant, a breach of that duty by the defendant, and consequent damage. But there can be no liability until the damage has been done. It is not the act but the consequences on which tortious liability is founded. ... It is vain to isolate the liability from its context and to say that B is or is not liable, and then to ask for what damage he is liable. For his liability is in respect of that damage and no other. If, as admittedly it is, B's liability (culpability) depends on the reasonable foreseeability of the consequent damage, how is that to be determined except by the foreseeability of the damage which in fact happened - the damage in suit?"

The corollary is that a postulated duty of care must be stated in reference to the kind of damage that a plaintiff has suffered and in reference to the plaintiff or a class of which the plaintiff is a member. I venture to repeat what I said in John Pfeiffer Pty Ltd v Canny (1981) 148 CLR 218 , at pp 241-242:

"His duty of care is a thing written on the wind unless damage is caused by the breach of that duty; there is no actionable negligence unless duty, breach and consequential damage coincide ... For the purposes of determining liability in a given case, each element can be defined only in terms of the others."

It is impermissible to postulate a duty of care to avoid one kind of damage - say, personal injury - and, finding the defendant guilty of failing to discharge that duty, to hold him liable for the damage actually suffered that is of another and independent kind - say, economic loss. Not only may the respective duties differ in what is required to discharge them; the duties may be owed to different persons or classes of persons. That is not to say that a plaintiff who suffers damage of some kind will succeed or fail in an action to recover damages according to his classification of the damage he suffered. The question is always whether the defendant was under a duty to avoid or prevent that damage, but the actual nature of the damage suffered is relevant to the existence and extent of any duty to avoid or prevent it.

The damage of which the respondents complain is structural damage to the house. Unless the risk of that damage was created or increased by some act done by the Council, the Council was under no duty to inspect the foundations, or to discover that the footings were constructed on unstable and insecure foundations or to tell the builder on what foundations the footings should be constructed or to enforce the prohibition on occupation of the building. There was no statutory duty to do those things. The only antecedent act done by the Council was its approval of the plans and specifications. There was no reason why the Council should have refused to approve the plans and specifications. If the builder, in accordance with his obligations under the Act, had constructed the building in accordance with the plans and specifications and the requirements of the Ordinance ("in a good and workmanlike manner") the structural damage would not have occurred. There was a risk, no doubt, that the builder might not construct the building as he was bound to do, but that was not a risk which the approval of the plans either created or increased. There is no duty on, indeed no power in, the Council to refuse approval to plans merely because they do not minimize the risk of defective and unworkmanlike construction. As the approval of the plans did not increase that risk, the structural damage that resulted from the builder's negligence cannot be attributed to the Council.

The Council is not charged with the performance of the supervisory functions of an architect. An architect, though not usually involved in the physical work of erecting a building, usually directs, at least to some extent, the hands which do the physical work. He is, whereas a council is not, engaged to supervise what the builder does. The Council is merely empowered to require that the Act, the Ordinance, the plans and the specifications be observed, but an architect is ordinarily under a duty to give directions ensuring that the contract work is done in a good and workmanlike manner. Because there is a difference in the duty, there may be a difference in liability. In Florida Hotels Pty Ltd v Mayo (1965) 113 CLR 588 Barwick C.J., with the concurrence of Kitto, Taylor and Menzies JJ., expressed the opinion (at p 599) that an architect employed by an owner to supervise construction of a building owed a duty of care to a third person - a stranger to the architect's contract of employment - who was injured by the collapse of a part of the building the construction of which the architect had carelessly supervised. The opinion was obiter, and Windeyer J. preferred to leave the question aside (p 603). There is no reason to doubt that, in some circumstances, an architect may be liable if a building which he has designed and the construction of which he has supervised falls down and injures a person who is a stranger to the architect's contract of employment. The relevant duty "is cast upon him by law, not because he made a contract, but because he entered upon the work", and his contract "determines what was the task upon which he entered" (per Windeyer J. in Voli v Inglewood Shire Council (1963) 110 CLR 74 , at p 85). The difference between the task upon which a supervising architect enters and the more restricted task upon which a Council may enter in exercising its statutory powers serves to distinguish the opinion expressed in Florida Hotels and the present case.

The Council did not design what the builder constructed, nor was it under a duty to supervise the construction. If, as Robson D.C.J. found, "competent supervision and examination" of the foundation trenches and foundations were required before construction of the footings commenced, it was not the Council's duty to provide that supervision and examination. The Council's actions did nothing to minimize the risk of defective footings, but they did not create or increase that risk. The Council's omission to exercise its powers of inspection more rigorously do not make it liable for the consequences of the builder's negligence. As Lord Romer said in East Suffolk:

"If in the exercise of their discretion they embark upon an execution of the power, the only duty they owe to any member of the public is not thereby to add to the damages that he would have suffered had they done nothing. So long as they exercise their discretion honestly, it is for them to determine the method by which and the time within which and the time during which the power shall be exercised; and they cannot be made liable, except to the extent that I have just mentioned, for any damage that would have been avoided had they exercised their discretion in a more reasonable way."

As the Council was under no duty to act to prevent the consequences of the builder's negligence, the respondents must fail.

It would have made no difference, in my opinion, if the respondents had shown that they had incurred expenditure on remedial work in order to avert injury to safety or health. That was the position in Anns where Lord Wilberforce classified the damage in this way:

"If classification is required, the relevant damage is in my opinion material, physical damage, and what is recoverable is the amount of expenditure necessary to restore the dwelling to a condition in which it is no longer a danger to the health or safety of persons occupying and possibly (depending on the circumstances) expenses arising from necessary displacement."

In Peabody Fund v. Sir Lindsay Parkinson Ltd. (1984) 3 WLR 953 , at p 961, Lord Keith of Kinkel said of the damages held to be recoverable in Anns:

"It is important to notice that these sums were not recoverable as economic loss pure and simple, but as representing expenditure necessary to avert injury to safety or health."

Although Lord Wilberforce referred (at p 759) to the prevention of damage "which is certain to endanger the health or safety of occupants" as the "whole purpose" of the by-laws in Anns, his Lordship did not hold that the by-laws conferred a right of action if their purpose was not fulfilled. Nor did he treat the damage in that case as being the risk of personal injury. For reasons stated in Wagon Mound (No 1), damages in respect of personal injury cannot be awarded for the risk of personal injury even though the prospect of such injury is present and immediate.

Lord Wilberforce's classification of the damage in Anns as "material, physical damage" to the dwelling raises the question whether a dwelling can be said to be damaged by the manner of its construction. That notion raises some significant conceptual difficulties which it is not necessary now to explore. Presumably the damage consists in the state in which the building is in comparison with the state in which it would have been if the allegedly tortious act or omission had not occurred. If the house in this case can be said to be physically damaged at all, it was damaged ab initio when the defective footings were constructed. Nothing but the passing of time and the forces of nature have intervened to work any subsequent deterioration on which a plaintiff might found a cause of action. Whatever physical damage is done to a building by the manner of its construction and however grave the subsequent deterioration may be because of the initial defect, the building is damaged once only. Who may sue in respect of that damage?

When land or buildings which are part of land are damaged, those who have an interest in the land are entitled to recover damages for the damage done to their respective interests: Moss v. Christchurch Rural District Council [1925] 2 KB 750 ; Rust v. Victoria Graving Dock Company, and London and St. Katherine Dock Company (1887) 36 ChD 113. The wrongdoer is liable to be sued by each plaintiff whose interest is adversely affected by the physical damage done, but the physical damage does not give rise to successive causes of action as each new manifestation of the original damage appears. In Darley Main Colliery Co. v. Mitchell (1886) 11 App.Cas. 127 Lord Halsbury said, at pp 132-133:

"No one will think of disputing the proposition that for one cause of action you must recover all damages incident to it by law once and for ever. A house that has received a shock may not at once shew all the damage done to it, but it is damaged none the less then to the extent that it is damaged, and the fact that the damage only manifests itself later on by stages does not alter the fact that the damage is there; and so of the more complex mechanism of the human frame, the damage is done in a railway accident, the whole machinery is injured, though it may escape the eye or even the consciousness of the sufferer at the time; the later stages of suffering are but the manifestations of the original damage done, and consequent upon the injury originally sustained .

There was a suggestion made by Stable J. in Maberley v. Peabody & Co. [1946] 2 All ER 192 , at p 194 that, when a wall is damaged and gradually disintegrates, it may be that a fresh cause of action arises as each brick topples down and that there is a continuing cause of action until the root of the trouble is eradicated. His Lordship was, as his language reveals, referring to the possibility of a continuing cause of action in nuisance, distinguishing that cause of action from other causes of action where fresh damage is required to support successive actions. But Stable J.'s dictum led Cooke J. to observe in Bowen v. Paramount Builders (1977) 1 NZLR 394, at p 424, that "(p)resumably ... it is a question of fact and degree whether damage is sufficiently distinct to result in a separate cause of action". That view is implicit in Lord Wilberforce's speech in Anns (where his Lordship acknowledges the assistance derived from Bowen v. Paramount Builders, at p 760) and in Pirelli v. Oscar Faber & Partners [1983] 2 AC 1 . With great respect, that view seems to me to be inconsistent with the principle in Darley Main Colliery Co. v. Mitchell - the "once-for-all" rule - that is fundamental not only to the theory but to the practical operation of the law of negligence. If the "later stages of suffering" when they become much different in degree from the initial injury are to be treated as fresh damage, the once-for-all rule is of uncertain operation and the assessment of damages for initial injury must stop short of compensation for its gravest consequences. In the field of personal injury, much has been written in favour of a system that is not based on the once-for-all rule, and I do not enter that debate. But in the field of damage to real property, the notion that some degrees of damage manifested at a later stage than the initial damage constitute fresh damage is at odds with principle.

It is equally at odds with practicality. If a building is said to suffer fresh damage when, without any external cause, the initial damage reaches a certain stage of severity, successive causes of action will arise and, as the owners of the property may have changed, the causes of action may be vested in different persons. What are the implications? I shall assume that the measure of damages for this kind of damage may be either diminution in value of the property or the cost of making the damage good, dependent upon the circumstances. Then let it be assumed that vendor and purchaser both know of the original damage and its potential consequences. The first owner would be entitled to damages for the diminution in value of the property on sale, a value which might be expected to reflect the potential for further deterioration. A subsequent owner, having bought at a depressed price, acquires a new cause of action when the degree of deterioration reaches the critical stage which is seen to be fresh damage. He would be entitled to the cost of repairs. If Lord Wilberforce's view in Anns (at p 759) were adopted, the measure of damages to which he would be entitled is "the amount of expenditure necessary to restore the dwelling to a condition in which it is no longer a danger to the health or safety of persons occupying and possibly (depending on the circumstances) expenses arising from necessary displacement". So the first purchaser may effect only partial repairs - sufficient to eliminate the risk to health and safety. If the underlying defect is not repaired, a new cause of action would arise with each further deterioration. Next, let it be assumed that the first owner recovers the cost of repairs for damage before it reaches the critical stage, but sells for full value without disclosing that damage or making the repairs , presumably the second owner would be entitled to recover for the total loss of value in the premises once the damage reaches the critical stage. He would recover for damage for which the first owner could have recovered if he had known of the damage.

If the damage which gives rise to the cause of action occurs not when the original damage to the house is done or even when it is discovered but when it advances to such a stage as to be a danger to health and safety, there would be some unjust consequences. In Anns, it was said that the critical stage arose when "the state of the building is such that there is present or imminent danger to the health or safety of persons occupying it" (at p 760). But if present and imminent danger to the health and safety of occupants is the criterion, why should damages be recoverable by an absentee owner or by an occupant who has no intention of effecting repairs before he quits? I agree with Lord Keith's observation in Peabody Fund:

" ... it is difficult to see how, having regard to the scope of the duty held to exist, a non-resident owner could fall within the ambit of it, since he would not be subject to any possible injury to safety or health. Yet Lord Wilberforce would appear to be saying that the duty is owed separately to owners and to occupiers."

If negligence in the construction of a building can properly be seen to be the cause of physical damage to that building - a proposition to which I give no assent for the moment - the better view is that only those with an interest in the property at the beginning, when the initial damage is done, can recover. Subsequent purchasers in the position of the respondents have no cause of action. The cause of action, if it existed, is vested in the original owners unless they assign it to their purchasers (a question not raised in this case).

I do not wish to found my opinion on a rejection of the classification of the damage adopted in Anns. The question is, as I have said, whether the appellant was under a duty to avoid the damage actually suffered and the answer to that question does not depend upon correct or incorrect classification in pleading or in argument. It is necessary to identify what is the event, circumstance or liability that is said to constitute the plaintiff's damage and, having regard to its nature and the circumstances of the case, to determine whether the defendant was under a duty to avoid or prevent it. The nature of the damage is relevant to the existence and scope of the duty when a special element restricts the cause of action for damage of that kind (see Jaensch v. Coffey 58 ALJR, at pp 437,438; 54 ALR, at pp 437,438).

The respondents might have identified their damage not as structural damage to their house but as a diminution in the value of their house below what they paid for it or as a liability to pay out money to make it reasonably habitable. If that were the true nature of the damage, it would be economic loss (see Junior Books Ltd. v. Veitchi Ltd. [1983] 1 AC 520 , especially per Lord Roskill at p 545, and Rivtow Marine Ltd. v. Washington Iron Works (1973) 40 DLR(3d) 530, especially per Laskin J. at p 549). Apart from the special elements restricting the cause of action for negligence occasioning economic loss, it would have been necessary for the respondents to show that the structural damage and the defective footings which produced that economic loss were attributable to the Council's negligence or that the Council had negligently represented to the respondents that the house was sound or that it had been built in accordance with the Act, Ordinance and approved plans and specifications. For reasons already stated the structural damage cannot be attributed to the Council's conduct. Nor can it be said that any belief that the respondents may have entertained about the structure of the house was induced by the Council.

The Council would have been under a duty to provide the respondents with information about the house had an application for a certificate under s 317A been made. None was made. There is no other statutory duty requiring the Council to give information about houses in its area. Nor is there a common law duty on councils to provide prospective purchasers of houses in their area with information about the soundness of the building under consideration. Apart from s 317A, no practice of giving such information was shown. The Council is responsible for the information furnished in a s 317A certificate, but it is not liable for miscalculations of value in buying and selling when those miscalculations are based on other information. A private purchaser in the market place cannot look to public funds to underwrite the information on which he makes his purchase except in circumstances which attract the operation of the principle in Shaddock or where a certificate is furnished pursuant to s 317A.

The respondents had no cause of action against the Council. The Council ought to have succeeded in the District Court and in the Court of Appeal. I would allow the appeal accordingly.