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Hilift Pty Ltd Essay

Hilift Pty Ltd (Hilift) owns an industrial crane. Hilift employs two crane operators, Elwyn and Osman, who each work 4 hour shifts. In May 2008 the owner/builder of a new apartment block hires Hilift’s crane and operators for two weeks to lift building materials to the upper floors of their building. At the end of the first shift on the 10 May, Elwyn notifies the manager of Hilift that the crane is not performing properly and that it needs looking at. The manager contacts the company who does repairs and maintenance work on the crane, EFL Engineering, and asks for an engineer to be sent out immediately. EFL says that no-one is available for two hours. The manager of Hilift decides to allow Osman to begin his shift before the engineer arrives, since to stop work will delay construction.

Osman is halfway through hoisting his first load when a cable in the crane snaps and the crane swings out of control, smashing into a lower floor of the building. Two construction workers in the building are injured. One has both legs crushed and they have to be amputated. The other worker will be hospitalised for a long time with serious injuries but will make a full recovery. The building is damaged by the accident and will cost $75,000 to repair. The construction of the building is delayed by three months because of the accident, and for this period the expected income from tenants is lost. Osman is deeply traumatized by these events and cannot bring himself to drive a crane again. After a period of six months without employment, during which he receives psychiatric treatment, Osman takes lower paid work as a general construction worker. A subsequent inspection of the crane finds that the fault in the cable would have been discovered if an engineer had inspected the crane after Elwyn’s shift had ended. To replace this cable would have taken six hours.

Advise Hilift as to whether, and to what extent, the company will be liable in tort for the harm that has occurred.

Facts:

Hilift Pty Ltd owns industrial crane
May 2008: hired to lift building materials to upper floor of new apartment block Hilift is aware crane is not performing properly
Hilift contacts repairs company
Hilift allows Osman to work before crane is looked at Cable in crane snaps
Causes $75 000 of property damage and delays construction by 3 months Osman is traumatized, cannot drive crane again
Fault in cable would have been discovered by engineer

Advise Hilift as to whether, and to what extent, the company will be liable in tort for the harm that has occurred.

Consider: Osman, Construction Worker 1, Construction Worker 2 and the building owner using IRAC.

Issue:
Is the company liable in tort for the harm that has occurred to Osman, Construction Worker 1, Construction Worker 2 and the building manager and to what extent?

Rule
Tort of Negligence:
The respondent in a civil claim of negligence will only be liable to the applicant/plaintiff by way of damages if the following elements are established on the balance of probabilities: 1. That a duty of care was owed by the respondent to the plaintiff in the relevant situation; Here you would cite cases if relevant – specific tests/standards etc. 2. That the respondent breached that duty of care owed to the plaintiff; and Again, cite case authority and any applicable standards – e.g. “reasonable person” 3. That the plaintiff has suffered some injury or damage as a result of that breach. Case authority – e.g. the injury must be reasonably foreseeable.

Apply – Osman

1. Duty of care?
Hilift reasonably ought to have been able to foresee, and clearly did know, that there would be risk that the crane would malfunction or break which would likely cause physical or psychological harm to the crane operator, if he did not wait for the maintenance / repairs company. This is supported by the fact that the other operator, Elwyn, notifies the manager of Hilift after his shift recommending that the crane needs to be looked at. This is also supported by the fact that the manager contacts the maintenance company: if he did not perceive there to be a risk, why did he contact the maintenance company and request a consultation “immediately”? While a person is not generally liable in tort for psychological harm, this is a special case under the “pure mental illness” exception, whereby the plaintiff, Osman, witnessed the two construction workers being severely injured Neighbour principle: Established a duty of care between employer and employee in Wilson & Clide Coal Co LTG v English (1938): employers owe employees a duty of care to provide a safe working environment, and Paris v Stepney Borough Council (1951).

2. Breach?
Standard of care: the “reasonable man” definitely would have believed there to be a real and foreseeable risk that the plaintiff might be injured if the crane malfunctioned or broke The “reasonable man” would have waited the two hours for an engineer from EFL Engineering to check the crane. The “reasonable man” would have exercised a much greater standard of care, particularly as the crane was lifting building materials to upper floors and the consequences if the crane malfunctioned were very serious.

3. Damage?
Osman was “deeply traumatized” and cannot drive a crane again He received psychiatric treatment and would eventually take lower paid work. Causation: if Hilift had waited for EFL Engineering, the cable would not have snapped and would not have caused Osman’s psychological injury. (“But for” test) Foreseeability: Hilift ought to have foreseen that if he did not wait for the EFL Engineering consult, that the crane could malfunction and this malfunction would be likely to cause injury or death to others and consequently cause a severe risk of physical or psychological harm to the crane operator.

Conclusion – Osman
Hilift would be liable in tort for the psychiatric injury to Osman, but is unlikely to be liable in tort for the compensation for Osman’s reduced salary after the accident because established in Kyogie shire Council v Francis (1989) that it is not permissible for the court to award damages to compensate the injured for profits they may have earned if not for the negligent conduct.

Apply – Construction worker 1 (Amputee)

1. Duty of care?
Hilift reasonably ought to have known that there would be a (not insignificant) risk that the crane would malfunction or break, which would, in turn, be likely to cause severe damage or injury to workmen below. Supported by Hilift’s contact with the maintenance company: if he did not perceive there to be a risk, why did he contact the maintenance company and request a consultation “immediately”? Neighbour principle: Established a duty of care between employer and employee in Wilson & Clide Coal Co Ltd v English (1938): employers owe employees a duty of care to provide a safe working environment, and Paris v Stepney Borough Council (1951).

2. Breach?
See “Breach” in Apply – Osman
The likely seriousness of the consequences of Hilift continuing construction without waiting for the engineer were extremely serious as the crane was handing heavy materials at a high altitude, which suggests Hilift ought to have exercised a higher standard of care.

3. Damage?
The snapping of the cable caused direct, severe injury to the construction worker, requiring amputation of both legs. Causation: If Hilift had waited for EFL Engineering, the fault in the cable would have been detected and fixed, and the construction worker would not need to be amputated.
Foreseeability: Hilift ought to have foreseen that if he did not wait for the EFL Engineering consultant, the crane could malfunction and this would be likely to cause severe injury or death to construction workers working on lower floors.

Conclusion – Construction Worker 1
Hilift would be liable in tort to pay compensation for the costs incurred by Construction Worker 1 due to that hospitalisation and forced amputation of both legs, and possibly even “consequential mental harm” depending on the mental health of Construction Worker 1.

Apply – Construction Worker 2

1. Duty of care?
see “Duty of care” in Apply – Construction Worker 1*

2. Breach?
Standard of care: the “reasonable man” definitely would have believed there to be a real and foreseeable risk that the plaintiff might be injured if the crane malfunctioned or broke. The “reasonable man” would have waited the two hours for an engineer from EFL Engineering to check the crane. The “reasonable man” would have exercised a much greater standard of care, particularly as the crane was lifting building materials to upper floors and the likely seriousness of the consequences if the crane malfunctioned.

3. Damage?
The snapping of the cable hospitalised Construction Worker 2 for an extended period of time and serious injuries. Causation: If Hilift had waited for EFL Engineering, the fault in the cable would have been detected and fixed, and the construction worker would not need to be hospitalised. Foreseeability: Hilift ought to have foreseen that if they did not wait for the EFL Engineering consultation, the crane could malfunction and this would be likely to cause severe injury or death to construction workers working on lower floors.

Conclusion – Construction Worker 2

Hilift would be liable in tort for compensation for the costs incurred by Construction Worker 2 for the hospitalisation due to Hilift’s negligent inaction by allowing Osman to continue work on a faulty crane.

Apply – Building Manager

1. Duty of care?
Hilift ought to have foreseen that if the crane was faulty, it would likely cause damage to the building Duty of care: professional persons (Hilift) owing a duty to client (building owner) established in Hill v Van Erp (1997). Analogous situation: manufacturers (Hilift) owing a duty to eventual consumer (building owner) established in Donohue v Stevenson (1932).

2. Breach?
Standard of care: the “reasonable man” definitely would have believed there to be a real and foreseeable risk that the building would be damaged if the crane malfunctioned while handing heavy building materials. The “reasonable man” would have waited the two hours for an engineer from the EFL Engineering to check the crane.

3. Damage?
The building will cost $75 000 to repair
Construction is delayed by three months; expected income from tenants during this period is lost. Causation: If Hilift had waited for EFL Engineering, the fault in the cable would have been detected and fixed, and the building would not need to be repaired, nor will construction be delayed 3 months. Foreseeability: Hilift ought to have foreseen that if he did not wait for the EFL Engineering consultation, the crane could malfunction and this would be likely to cause damage to the building.

Conclusion – Building Manager

Hilift would be liable in tort for the compensation of $75, 000 for the building repair, but precedent suggests the company will not be liable for compensation for the expected profits the building owner lost due to the three month delay. This was established in Kyogle Shire Council v Francis (1989).


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