On 2 July 2021, the Court of Appeal in Western Australia handed down judgment in Herridge Parties v Electricity Networks Corporation t/as Western Power [2021] WASCA 111. This decision has significant implications for electricity operators in relation to potential bushfire actions. The Court of Appeal overturned the earlier decision of the Supreme Court of WA, which found that the electricity operator, being Electricity Networks Corporation t/as Western Power (Western Power), was not liable for the Parkerville bushfire that occurred in 2014. The Court of Appeal found that Western Power was liable in negligence. It said that it breached a common law duty of care by failing to have a system for the periodic inspection of 'point of attachment' poles, despite such poles not being within the ownership of Western Power. The Court of Appeal found that Western Power should have undertaken periodic inspections of 'point of attachment' poles, in addition to undertaking such inspections on its own poles.
Clarifying the role and responsibilities of network operators and landowners
In the current climate of extreme bushfires in Australia, this decision assists in clarifying the responsibilities of network operators, contractors and owners of private electricity poles. It suggests that electricity operators owe a duty to take reasonable care to avoid or minimise the risk of fires, which may require that inspection or maintenance be undertaken on electrical assets beyond its own distribution system. This is subject to applicable legislation that may restrict its duty more narrowly.
The decision also confirms that individual landowners can be held liable for bushfires if regular inspections are not procured on privately owned poles. On the same day as this decision, the Supreme Court of Tasmania also handed down a decision concerning the Dunalley bushfire, which occurred on 3 January 2019: Prestage v Barrett [2021] TASSC 27. It found that an individual landowner was liable to several hundred plaintiffs in negligence and nuisance, for failing to extinguish a campfire lit in a tree stump, which ignited grass leading to the bushfire. These decisions have significant implications for home and contents insurers, as liability arising in this way may not have been contemplated under such policies.
Details of the Parkerville bushfire and following proceedings
The Parkerville bushfire occurred on 12 January 2014, when a wooden power pole located on private property (PA Pole) fell towards the ground. It led to a bushfire that burnt 392 hectares, destroyed 56 homes and damaged many others. The PA Pole is referred to as a 'point of attachment' pole, as it is a privately owned pole that connects to the electricity distribution system, which is owned by Western Power.
Four separate proceedings were commenced by four plaintiff groups, representing several hundred plaintiffs, being Parkerville residents and their insurers. The proceedings were commenced against three defendants:
- Western Power, as the operator of the electricity distribution system in the area of the bushfire;
- Ventia Utility Services Pty Ltd (formally known as Thiess Services Pty Ltd) (Thiess), as Western Power's contractor; and
- the owner of the property on which the relevant power pole was located (Owner).
Relevantly, Thiess had been engaged by Western Power in July 2013 to replace a power pole owned by Western Power, which was adjacent to the PA pole, including the replacement of the electrical cable attached to the PA pole. In undertaking this work, Thiess conducted a 'pre-work' inspection on the PA pole to ensure it was in a safe and fit condition. This was done approximately six months prior to the PA Pole collapsing, causing the fire. Investigations following the fire revealed that the PA Pole was severely impacted by rot and termites and was not in a serviceable condition since at least 2010.
Supreme Court decision
The Supreme Court of Western Australia handed down judgment in April 2019. The Supreme Court found that Western Power owed a 'pre-work inspection duty of care'. This was a duty to take reasonable care before and when undertaking work on the PA Pole to ascertain whether it was in a safe and fit condition and, if not, a duty not to use the PA Pole in connection with the supply of electricity. However, the Supreme Court found that Western Power discharged its 'pre-work inspection duty of care' by engaging and instructing Thiess to carry out the relevant work in July 2013.
The Supreme Court rejected the argument that Western Power owed a broader duty of care (including a duty to inspect and maintain 'point of attachment' poles generally), on the basis that such a duty was incompatible with the relevant legislative scheme under section 25 of the Electricity Act 1945 (WA). The Supreme Court found that this legislative scheme only required Western Power to maintain service apparatus belonging to it.
The Supreme Court found that Thiess was liable to the plaintiffs for failing to adequately train and supervise its crew and failing to exercise due care and skill in undertaking the pre-work inspection on the PA Pole in July 2013. The Supreme Court also found that the Owner was liable to the plaintiffs as the owner of the pole, given she failed to procure regular inspections of the PA Pole.
Court of Appeal decision
Western Power was found to owe a common law duty of care to persons in the vicinity of its network, to take reasonable care to avoid or minimise the risk of injury, and loss or damage to property, from the ignition and spread of fire in connection with the delivery of electricity. The Court found that section 25 of the Electricity Act 1945 (WA) did not exhaustively define the duty which Western Power may owe to third parties and the common law duty was not inconsistent with the statutory scheme. In any event, the Court of Appeal found that when correctly interpreted, section 25(1)(a) imposed a duty to inspect and deal with a point of attachment pole when necessary to maintain service apparatus belonging to it in a safe and fit condition for supplying electricity.
The Court of Appeal determined that Western Power breached this duty, as a reasonable operator would have had a system in place for undertaking periodic inspections of wooden point of attachment poles more than 15 years old supporting its electrical apparatus, especially in rural areas where there was an elevated risk of bushfires, irrespective of whether it owned the poles.
The Court of Appeal was not sympathetic to arguments that Western Power did not have knowledge within its possession regarding the number, age and condition of point of attachment poles. The Court found that the lack of information was a product of Western Power's view regarding the extent of its duty, and said that a reasonable network operator which undertook periodic inspections would have acquired such information over time. The Court also noted that, while the cost of periodically inspecting point of attachment poles would no doubt be significant (noting Western Power's estimate that there were approximately 130,000 point of attachment poles connected to its system), it was not disproportionate to the magnitude of the risk of harm posed by such poles failing.
While the Court of Appeal upheld the findings of liability against Thiess and the Owner, it concluded that Western Power was the party with the greatest responsibility for the plaintiffs’ damages and loss.
The Court of Appeal also upheld the earlier decision that Western Power did not owe a non-delegable duty of care in respect of 'pre-work inspections'. Predominantly, this was because Western Power did not have the requisite level of control over the land on which Thiess performed its work. This meant Western Power could discharge its duty by delegating pre-work inspections to Thiess.
What does this mean?
With various bushfire actions on foot or contemplated around Australia, particularly following the Black Summer bushfires in NSW, this decision provides some guidance on the responsibilities owed by various parties associated with electricity assets and distribution systems. In this case, the Court of Appeal extended the common law duty of care owed by the electricity operator beyond the maintenance of electricity assets wholly within its ownership. It also confirmed that individual landowners with power poles on their property may be held liable if they do not procure regular inspections of the pole. This potentially has significant implications for home and contents insurers.
