Court of Appeal Supreme Court New South Wales

• Medium Neutral Citation: AV8 Air Charter Pty Limited v Sydney Helicopters Pty Limited [2014] NSWCA 46
• Hearing dates: 07.11.2013
• Decision date: 12 March 2014
• Before: Barrett JA at [1]; Hoeben JA at [2]; Ward JA at [139]

Decision

Appeal is dismissed.

The appellant is to pay the costs of the appeal.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

• Catchwords: TORT - negligence - claim for economic loss by owner of helicopter against bailee of helicopter arising from conduct of pilot - helicopter coming into contact with overhead powerline - challenge to factual findings of trial judge - whether evidence before trial judge capable of proving substantial deterioration in weather conditions - whether due weight given to opinion of experts - whether negligent of pilot to continue flying in deteriorating weather conditions - assessment of alternatives open to pilot - need to assess actions of pilot prospectively not in hindsight - use of Civil Aviation Regulations as particulars of negligence - application of ss 5B and 5C Civil Liability Act 2002 - CAUSATION - negligence not established - CONTRACT - what terms should be implied - extent to which Civil Aviation Regulations were to be implied in contract - PROPORTIONATE LIABILITY - whether owner of powerline liable in tort - class of pilot to whom duty owed - foreseeability of relevant "risk of harm" - powerline owner liable in negligence - DAMAGES - loss of profits and diminution in value of repaired helicopter - failure of trial judge to have regard to agreement between parties - factual error of trial judge requiring appeal court to re-assess damages.
• Legislation Cited: Civil Liability Act 2002
• Cases Cited: AV8 Air Charter Pty Ltd v Sydney Helicopters Pty Ltd [2012] NSWDC 220; BP Refinery (Westernport) Pty Ltd v Hastings Shire [1977] UKPCHCA 1; (1994)180 CLR 266; Breen v Williams [1996] HCA 57; 186 CLR 71; Coulton v Holcombe [1986] HCA 33; 162 CLR 1; Fox v PercyI [2003] HCA 22; 214 CLR 118; Hawkins v Clayton [1988] HCA 15; 164 CLR 539; Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11; 243 CLR 361; Leighton Contractors Pty Ltd v Fox; Calliden Insurance Limited v Fox [2009] HCA 35; 240 CLR 1; Podrebersek v Australian Iron & Steel Pty Ltd [1985] HCA 34; 59 ALJR 492; Roads and Traffic Authority (NSW) v Dederer [2007] HCA 42; 234 CLR 330; Ruhani v Director of Police (No 2) [2005] HCA 43; 222 CLR 580; Sheather v Country Energy [2007] NSWCA 179; (2007) Aust Torts Reports 81-901; The Ship "May" v R (1931) SCR 374 at 382; Vairy v Wyong Shire Council [2005] HCA 62; 223 CLR 422; Vero Insurance Limited v Rail Corporation of NSW [2013] NSWCA 372; Vozza v Tooth & Co Ltd [1964] HCA 29; 112 CLR 316; Warren v Coombs [1979] HCA 9; 142 CLR 531; Water Board v Moustakis [1988] HCA 12; 180 CLR 491; Zheng v Cai [2009] HCA 52; 239 CLR 446
• Texts Cited: Cheshire & Fifoot Law of Contract (8th edition)
• Category: Principal judgment
• Parties: AV8 Air Charter Pty Limited - Appellant; Sydney Helicopters Pty Limited - Respondent
• Representation: Counsel: Mr D Fagan SC/Mr T Brennan - Appellant; Mr G Curtin SC/Mr G Gregg - Respondent; Solicitors: Norton White - Appellant; Gilchrist Connell - Respondent
• File Number(s): 2012/390046

Decision under appeal

• Citation: [2012] NSWDC 220
• Date of Decision: 2012-12-07 00:00:00
• Before: Levy DCJ
• File Number(s): 2010/348326

Judgment

1 BARRETT JA: For the reasons stated by Hoeben JA, this appeal must be dismissed with costs

2 HOEBEN JA:

Nature of appeal

The appeal concerns an economic loss claim founded upon allegations of negligence and breach of contract from the flying of a civilian helicopter that was damaged when it struck a suspended overhead powerline. The accident occurred on 29 January 2009 while the helicopter was on a flight from Scone to Sydney.

3 The appellant owned the helicopter. The respondent was the bailee of that helicopter and Mr Harrold, the respondent's pilot, was in control of the helicopter at the time of the wire strike. The appellant sought damages for the diminution in the resale value of the helicopter and the loss of profits during the period it could not be used or hired while it was under repair. It was common ground that the Civil Liability Act 2002 (CLA) applied to these proceedings.

4 A summary of the accident is that in deteriorating weather conditions the helicopter descended below cloud level near Broke and flew on for several minutes after that descent before it struck a powerline that was suspended along a valley located in restricted military airspace near Singleton Army Base in NSW. The presence of that powerline was not indicated on the map being the Visual Navigation Chart (VNC) that was then available to Mr Harrold.

5 The issue argued before this Court was whether the respondent's pilot had been negligent. There were, however, a number of subsidiary issues including contract and the apportionment provisions of the CLA. The oral submissions on the appeal differed somewhat from the written submissions. The oral submissions challenged crucial aspects of the judge's fact finding. The Court must therefore make its own independent assessment of the facts and give effect to its conclusions about them (Fox v PercyI [2003] HCA 22; 214 CLR 118 at [21] - [25], [27]). The Court must weigh conflicting evidence and draw its own inferences and conclusions - bearing in mind, however, that it has neither seen nor heard the witnesses - and having due regard to those findings of fact of the trial judge which have not been challenged (Warren v Coombs [1979] HCA 9; 142 CLR 531; Vero Insurance Limited v Rail Corporation of NSW [2013] NSWCA 372 at [8] - [9]).

6 An important issue in the appeal was the availability of the findings which the trial judge made about the prevailing weather conditions and the extent and location of the cloud cover which restricted the movement of the aircraft. The appellant submitted that taking Mr Harrold's evidence at its highest did not justify the findings which the trial judge made.

7 The particular findings of the trial judge which were impugned were at [108], [110] - [118], [120] - [127], [173] - [180], [182] - [187], [218] - [219]. The findings by his Honour in those paragraphs were to the effect that the deteriorating weather conditions and increase in cloud gave Mr Harrold little option but to make the choice which he did. His Honour stressed that his options needed to be looked at prospectively in order to assess the reasonableness of the choices which he made. In order to assess the availability of those findings, it is necessary to analyse the evidence on this issue.

Factual background and findings in the District Court

8 As a start point I propose to review the facts generally, paying particular attention to the findings made by the trial judge and the basis for them.

9 Factual evidence was given by the following witnesses:

(i) Mr Paradice was a passenger in the helicopter and owned a controlling interest in the appellant.

(ii) Mr Harrold was the Managing Director of the respondent and the pilot flying the helicopter at the time of the wire strike.

(iii) Mr Hodge was an employee of the respondent and a helicopter pilot who was a passenger in the helicopter at the time of the wire strike.

(iv) Mr Franks was a helicopter pilot who in 1994 had flown a helicopter over the area in the course of effecting repairs to a powerline damaged by a wire strike with a helicopter.

(v) Mr Hopkins was an Aviation Assessor with QBE Insurance.

(vi) Mr Dunscombe was the pilot of an NSW Police helicopter that had struck the same wire located on the southern boundary of the Singleton Army Training Area (SATA) on 23 March 1994. He provided a statement.

10 Four experts gave evidence.

(i) Mr Nest was a Senior Helicopter Flight Trainer and Check Captain with over 25 years' experience in operating helicopters, both in the RAAF and in a civilian setting. He had extensive experience in consulting and risk assessment matters, had flown more than 6,408 hours in helicopters at the time he wrote his report and was retained as an expert by the appellant.

(ii) Mr Daniel Tyler was a helicopter pilot who had flown helicopters in combat and civilian conditions. His experience was in Australia and overseas. His helicopter flying hours at the time of writing his report were in excess of 11,000 and he was retained as an expert witness for the appellant.

(iii) Mr Davies was a former RAAF Flying Instructor, who had extensive experience as an RAAF pilot since 1984 in numerous capacities including as an instructor. At the time of giving evidence he was a pilot on an A380 air bus but had extensive experience in flying safety issues in connection with military and civilian aviation. At the time he gave evidence his accumulated flying experience was 13,250 hours. He was retained as an expert by the respondent.

(iv) Mr Townsend had extensive experience in the aviation field over the course of 38 years. He had flown helicopters for 30 years as an instructor and had accumulated 19,000 hours in helicopters. He was retained as an expert by the respondent.

One of the challenges to the fact finding of the trial judge was that he paid insufficient attention to the opinion of these experts.

11 In oral submissions on the appeal, the appellant identified the negligence of the respondent as:

(a) Flying in restricted airspace in contravention of Civil Aviation Regulation (CAR) 140.

"So it's a significant part of the plaintiff's case at trial that when Mr Harrold perceived that he could not fly further south on his visual flight rules licence because of the cloud descending to the ridges, when he considered turning across to the east, which he said he did, and in consultation with this map, basic navigation would have told him that he couldn't skirt to the north of the high country, which had the clouds descending to the top of it without intruding into the restricted airspace." (Appeal Transcript (AT) 5.29 - .35)

(b) Flying below a safe altitude and at a height lower than 500 feet above the highest point of terrain within a radius of 300 metres at a point on the terrain vertically below the aircraft in contravention of CAR 157.

(c) " ... there was, in the evidence, no pressure of weather or other circumstance which justified him flying so close to the steeply rising ground, and that what did cause him to fly so close to the steeply rising ground was that he knew that he was either in restricted airspace or just outside it, and he was deliberately keeping as far southerly as he could and as close to that steep escarpment as he could in order to be in minimal intrusion on the army training area and as far from its activities as he possibly could be.

He in effect said that in his evidence. That's why he was flying in that manner and he got himself into that situation because of the serious error of navigation that he made at Broke or about Broke when he turned left or east and headed out to take a track which his air navigation chart showed would sandwich him between high ground with cloud on the top of it and a restricted area that he should not have been flying over, and it would force him to fly southerly and force him to fly low." (AT 7.50 - 8.15)

12 The following data was used by the parties, both at trial and in the appeal. At the relevant time the helicopter was travelling at approximately 90 knots, which is the equivalent of 150 kilometres an hour. Heights are given in feet and were either "above height datum" (AHD) or "above mean sea level" (AMSL). Heights were also given "above ground level" (AGL). This latter measurement was important because CAR 157 required that an aircraft should not fly lower than 500 feet above ground level and ground level was determined to be the highest point of ground in a radius of 300 metres from the point immediately below the aircraft.

13 Exhibit F was the Visual Navigation Chart (VNC) which Mr Harrold was using for the flight. It is common ground that this chart was in the cockpit of the helicopter at the time. It is obvious from an examination of it that it is a very small scale map. It does not show contours, it merely depicts major features such as towns, roads and rivers. For example, the Singleton Army Training Area (SATA) is designated by a red boundary line, but no physical features were shown whereby the actual boundary could be determined. In evidence the SATA was also described as "the Singleton Field Firing Range", "the Singleton Army Base, Dochra" and as R532A and R564A. It was common ground that the airspace above the SATA was restricted airspace.

14 His Honour found that no credit issues arose in relation to the witnesses. He concluded that their evidence was to be assessed by reference to its inherent reliability.

15 The following evidence was uncontroversial. Mr Harrold had been a licensed helicopter pilot since 2002. He had been the Managing Director of the respondent since 2008. At the time of the wire strike, he was endorsed to fly the EC 120 model helicopter and had previously accumulated about 48 hours flying time on such helicopters. He had held a commercial helicopter pilot's licence since 2006 and was authorised to fly only in accordance with the Visual Flight Rules (VFR) established by the Civil Aviation Safety Authority (CASA). In accordance with that licence, Mr Harrold was not allowed to fly through cloud, was required to keep sight of the ground at least every 30 minutes, and not fly by instrumentation alone.

16 The parties had a relatively short-lived commercial relationship with respect to helicopter hire and charter activities. They had entered into an agreement in 2008 whereby the appellant permitted the respondent to manage, charter and operate a helicopter of the Robinson R44 type belonging to the appellant. Against that background, the parties had discussions concerning a proposed commercial basis for the appellant to acquire a Eurocopter EC 120B helicopter to be also operated by the respondent. On 16 December 2008 the appellant purchased the subject EC 120B helicopter from its previous US based owners in New Zealand.

17 In August 2008 Mr Harrold sent Mr Paradice a draft agreement setting out the terms on which the respondent would enter into contractual relations for the proposed charter and operation of an EC 120B helicopter. That draft was not executed by the parties, but a further copy was forwarded to Mr Paradice on 18 January 2009. On 28 January 2009 the appellant's EC 120B helicopter was delivered to the respondent's heliport at Rosehill. This was the helicopter involved in the wire strike.

18 At 11pm on 28 January 2009 the Bureau of Meteorology issued an area forecast from that time of issue to 4pm on 29 January 2009 in respect of the proposed flight area. At 4am on 29 January 2009 the Bureau issued an amended area forecast to include a warning of fog and mist patches for that area for the period from the time of issue, to 8am on 29 January 2009.

19 At about 7am on 29 January 2009 Mr Harrold undertook the required pre-flight inspection of the aircraft and then he and Mr Hodge took off from the respondent's heliport at Rosehill. At about 8am the helicopter landed at Mr Paradice's property at Wingham, north of Scone. Shortly after 8am Mr Paradice boarded the aircraft and the flight to Sydney commenced.

20 During the flight to Sydney at about 8.30am Mr Harrold encountered some cloud. He decided that he should take the aircraft into a descent in order to fly under the cloud. Subsequently at about 8.45am the aircraft struck a suspended overhead powerline. Although the helicopter was forced to land, no serious injury was suffered by either the pilot or the passengers.

21 The location of the wire strike was the same location where on 23 March 1994 a Polair helicopter had struck unmarked, overhead powerlines. No markers were installed on the overhead powerlines when they were replaced after that incident.

22 An important issue in the appeal was the availability of the findings which the trial judge made as to the prevailing weather conditions and the extent and location of the cloud cover. The appellant submitted that even if one took Mr Harrold's evidence at its highest, it did not justify the findings which the trial judge made. In essence, the appellant submitted that there was no proper evidentiary basis for those findings.

23 The particular findings of the trial judge which were impugned were:

"106 ... I am also satisfied that as the aircraft proceeded to fly along the designated track towards Sydney, Mr Harrold saw an area of cloud ahead that was broken in places, but as he continued on that flight, the cloud became more dense. He recognised that he should avoid flying over that dense cloud, in accordance with the well-known VFR safety requirements to which his licence was subject.

...

108 I am also satisfied that because of the presence of such cloud, Mr Harrold correctly identified the need to find a clear area around the cloud in order to make a descent to a cruising level below that cloud formation so as to maintain visual observation of the ground. I accept that he found an opportunity to make that descent near the township of Broke, where he made the descent and then turned the helicopter to the left to track generally east towards Cessnock to avoid that bank of low lying cloud and to seek out an alternative route that was not impeded by cloud or weather. The choice of Cessnock meant that if need be, he would have the opportunity to refuel, a matter he had to consider now that a change was required to his original flight plan to avoid flying through cloud.

...

110 I accept that at that time, Mr Harrold was flying the helicopter at about 90 knots, and was aware of the presence of some wind and cloud movement, and was not able to accurately discern the speed at which that cloud was moving, except to recognise that the cloud, described as deteriorating weather, was closing in from behind him, moving from his left towards his right, or approximately from the west to the east, as he flew away from it in order to avoid such cloud.

...

112 I also accept that in response to this deteriorating weather, Mr Harrold was aware of the need to maintain the safety of the aircraft and his passengers. He was at that time concerned to look for a way of avoiding flying through cloud, and at the same time, maintain adherence to the VFR requirements.

...

119 In the course of these events, on a number of occasions, Mr Harrold intermittently took the opportunity to look at, and to check, his VNC map to appraise his other safe options. At that time those options were rather limited due to evolving problems with the weather, namely, the cloud that was moving in from behind.

120 In those evolving events, Mr Harrold knew that he was flying into a valley, the southern border of which was the restricted military area that comprised the Singleton Army Base. At this time he was in effect in something of an emergency situation as he could not safely turn back because of the low cloud that had closed in behind him, and he therefore had very few options available to him. ...

121 I find that the circumstances in which Mr Harrold then found himself in were not normal flying conditions, and he needed to fly away from the weather, or the clouds, that were still closing in from behind. These events necessarily limited Mr Harrold's options, including for turning back.

122 Of the options that were then available to him, he chose to fly east and track along the northern side of the Great Dividing Range, in an attempt to avoid the problematic cloudbank referred to earlier. In order to do so, at some stage he had to pass over the Great Dividing Range. He took that course knowing that he would have to fly near the southern border of the restricted military area. This was because the ridge or spur of Mt Broken Back was ahead as marked on his VNC map, and the terrain to his right was rising towards the cloud cover.

123 He intended to skirt the southern edge of the restricted military area in taking that course. That decision was driven by the behaviour of the clouds. He consulted the VNC map for reassurance, gauging what he saw on that map in correlation with the landform features before him, as would have been expected of a pilot navigating in those circumstances. He interpreted this data as providing a safe and clear flight path towards Cessnock.

...

125 In the course of that flight, part of the mountain range to the east had started to protrude into the low-lying cloud as the terrain rose ahead of him as he aimed for Cessnock. He had taken a course that had cleared the range and he considered that he had cleared the Army Base as well. Although there was low cloud cover in the immediate area that had spread to his right and to the south, he saw clearer sky to the east.

126 As he was heading east in those events, his altitude was approximately 1850' above sea level, but as the terrain to his right was rising with the hills. He was therefore much closer to the ground than 1850' as he continued to proceed east with the low cloud above him.

127 In the course of those events, he encountered the overhead powerline that was immediately in front of him. The powerline was unmarked, and in that moment he had no opportunity to avoid striking it. ... (Red 60G - 64T)

24 In order to assess the appellant's attack on those findings of fact, it is necessary to set out parts of the evidence on this issue.

25 Mr Paradice gave evidence. Where that evidence conflicted with that of Mr Harrold, his Honour preferred the evidence of Mr Harrold. There was no challenge in oral submissions in the appeal to that conclusion by the trial judge. In the appellant's written submissions, however, this appears implicitly to be challenged, at least in part (AWS [69] - [77], Orange 24N-25K). In oral submissions the attack on Mr Harrold's evidence was to the effect that it was not capable of supporting the findings of the trial judge. I have approached this issue on the basis of the oral submissions made by senior counsel on the appeal.

26 Mr Paradice said that during the 10-30 seconds before the wire strike he had asked Mr Harrold why they were flying so close to the cliffs. Mr Harrold agreed that such a conversation had taken place, the details of which were set out at par 160 of his statement of 5 October 2011 as follows:

"Mr Paradice why are we flying close to the range?

ME: We have a restricted area to the left and we have hills to the right. I cannot fly through the cloud and the terrain is rising to the south." (Blue 325H)

27 Mr Paradice said that from the time of the left turn after the descent near Broke until the time of the wire strike, the aircraft did not fly through cloud but he observed that there were "misty" conditions below the aircraft. He said that at that time he could see a couple of hundred metres in front reasonably well.

28 Mr Hodge held a Civil Aviation rating endorsement for this type of helicopter. He occupied the left front seat position for the flight. He recalled the flight to Scone as uneventful in sunny and clear skies and he did not leave the aircraft at Scone. Mr Hodge's evidence substantially confirmed that of Mr Harrold. Where they disagreed, his Honour preferred Mr Harrold. No challenge to that finding was made in oral submissions in the appeal.

29 Mr Hodge described the flight plan from Scone to Sydney as a straight line from Scone to Mascot. He had the VNC map on his lap for most of the flight. On the flight from Scone he observed a bank of low-lying cloud to the south between Muswellbrook and Broke coming from the west and which obscured the view of the mountain range directly to the south. He said that there was a northern edge to that cloud bank and it was approaching the edge of the mountain range. He said that he had a clear view ahead to the mountain range. He said that at that time the aircraft was cruising at an altitude of about 2,500 feet.

30 Mr Hodge said that the flight had been unexceptionable until the aircraft commenced a descent at a point between Muswellbrook and Broke when the weather started to deteriorate with cloud moving from left to the right of the aircraft during the descent. He described the OCTAS rating of the cloud at that point as five, which is defined as meaning three-eighths of the sky was clear in front with plenty of gaps in the clouds so as to provide clear vision down to the terrain below and in front. Mr Hodge could not see the cloud behind him. As the aircraft tracked further south towards Broke, he noticed a continuing build up of low-lying cloud ahead. Before reaching Broke, he observed Mr Harrold to consult the VNC map for a period of not more than two minutes, during which time he took over control of the flight.

31 Just before the aircraft reached Broke, Mr Hodge remembered Mr Harrold saying words to the following effect:

Harrold: "We should go round the Army Base and head east. It is best not to attempt to go over the mountains. It may be clear of clouds over the other side of the mountains but we do not know what the weather is like on the other side.

If there is low-lying cloud over the other side of the range I may not be able to get through to land.

If we go east we will also have two refuelling options if we need them." (Blue 402X)

32 Mr Hodge said that Mr Harrold then proceeded to track to the east and fly between the southern side of the Singleton Army Base on his left and inclining mountain ranges to his right. Mr Hodge observed low lying cloud that was building up to the north and to the south, but a clear run of weather through to Cessnock and Newcastle.

33 Mr Hodge said that had he felt uncomfortable about the proximity of the ranges to the helicopter to the south or as to the helicopter's height, he would have said something to Mr Harrold. He said that he did not recall feeling anxious or in danger at any time because of Mr Harrold's decision to fly east past the Singleton Army Base. It was Mr Hodge's evidence that as they flew east, they had clear full visibility of everything in front but not to the north. He said:

"A. There was low lying cloud moving, it would have been moving in behind us from moving west to east."

34 After the aircraft had turned to the east, Mr Hodge's recollection was that there was clear visibility of the land below but he was not able to say how much low lying cloud there was.

35 Mr Harrold prepared two evidentiary statements dated 5 October 2011 and 17 February 2012. He was cross-examined extensively on those statements. He also provided CASA with a written notification of the wire strike incident. Mr Harrold's evidence as to what happened during the flight is set out in his October statement as follows:

"144 During the flight the low cloud I had seen to the South on my trip to Scone had moved North and I noticed that the weather had begun to change. I was travelling about 162 degrees South. I saw that the cloud was developing in front of me to the South, South-East and East.

145 There was also cloud to the West and North-West of the helicopter.

146 The Visual Flight Rules prevented me from travelling through cloud. Based on my assessment the cloud was lowering to the south where I had to clear a mountain range forming part of the Great Dividing Range.

147 The available options for me were:

(a) To attempt to fly above the cloud.

(b) To attempt to fly underneath the cloud at the same time as trying to clear the Great Dividing Range; or

(c) To head Eastwards in an attempt to avoid the cloud bank and pass over the Great Dividing Range in doing so.

148 I was not prepared to attempt to fly above the cloud bank. The difficulty with this course was that I was not sure there would be a break in the clouds at my destination which would enable me to land. There was the possibility that I might be caught above the cloud.

149 I was also worried about the possibility of attempting to fly underneath the cloud bank at the same time as trying to clear the ridge of the Great Dividing Range which lay to the South of my location.

150 It was a possibility that if I attempted this I would get squeezed between the ridge and the low cloud bank without any room to progress and may inadvertently enter cloud.

151 There was also no available refuelling stations along that course if I had to reverse course due to an inability to clear the mountain range.

152 At about this time I asked Roger to handle the controls while I called a friend of mine located in Newcastle, Mr Stephen Forgacs, to get an idea of the weather there. He did not answer and so I left a message on his voicemail. I received a reply text from Mr Forgacs soon after confirming that the weather was deteriorating on the coast near the Hunter River.

153 I consulted the VNC map which identified the air space and the terrain in this particular area. I wanted to determine the best course to adopt. Throughout the flight Roger had this VNC map open on his lap.

29 January 2009 - Course Correction

154 I had already passed Mount Wambo and Bulga and decided that I would continue towards Broke.

155 I remained below the cloud to enable me to adhere to VFR and to give me full vision of the range in the cloud bank in front of me.

156 On approaching Broke and avoiding any low lying cloud I continued to track east towards Cessnock and Newcastle. I did this because:

(a) I was unable to fly through the approaching cloud to the south;

(b) I am not an instrument rated pilot and my licence does not

allow me to fly through cloud.

(c) VH-EDP ( the helicopter) was not set up for instrumentation only flying.

(d) The terrain to the south was becoming high.

(e) By tracking East I had available to me two safe options in Cessnock and potentially Newcastle for landing if the weather was to deteriorate further or if I needed to refuel.

157 I was aware that Singleton Army Base was a restricted area to my left. This was identified on the VNC map. I remained under the low flying cloud and based on my interpretation of the land forms set out on the VNC map, kept outside the perimeter of the no fly zone of the Army Base. At no time did I intentionally enter restricted airspace.

158 I could see straight ahead to the East towards Cessnock. I recall that the visibility was clearer to the east, still cloud, however, the clearance between the base of the cloud and the ground appeared far greater.

159 I crossed the range and flew between the mountain range (now to my Southern right hand side) and the Army Base (now to my Northern left hand side) and under the cloud. I was concerned with remaining in sight of the ground and to safely navigate around the ridge and the Army Base.

...

29 January 2009 - The Wire Strike

161 As we tracked to the east, the range to the right protruded up into the cloud. As the cloud was low lying I could not see the top of the range to my right, although I could see straight ahead.

162 We were approaching Cessnock. At this point I was now clear of the range and the Army Base area and descending towards Cessnock. The range was about 50 metres on my right hand or southern side. The weather to the immediate east looked much better. The low lying cloud had spread across the rest of the sky to my south. I remained in sight of land at all times and never entered cloud.

163 The altitude of the helicopter at this time was approximately 1850 feet above sea level.

164 It was at this point I noticed a wire in front of us from right to left and the helicopter struck the wire no less than one second later."

36 On 30 January 2009 Mr Harrold provided CASA with a formal written notification. This was to similar effect as his statement albeit more brief. The relevant parts of the narrative are:

"We departed the private residence at 0805 and headed South on route to Sydney, the Upper Hunter Valley was cloud free, however, as we tracked further south it became evident that there was cloud developing South of Mount Wambo and extending overhead the mountain country to the South, whilst this cloud appeared broken and flight may have been possible on top of cloud while still maintaining a visual reference of the ground within a 30 minute window, I was not confident of being able to descend as I got closer to Sydney and was also mindful of the fuel available if indeed I had to turn back. So this option I considered unacceptable and unsafe.

As a result, I elected to track along the northern side of the range in a south-easterly direction for Cessnock then onward to either Kurri Kurri or Muldring, depending on how the weather looked. I was referring to the VNC 3 Newcastle Chart, effective 20 November 2008, which showed a clear passage free of wires and south of the Dochra area to Cessnock. We passed abeam Broke clear of cloud and with approx 500 foot clearance above ground and then south of the Dochra area. We then rounded the southern part of the Dochra area and headed for Cessnock, it was at this point that we struck the wire near the hill marked 1942."

37 The notification form indicated that at the time of the wire strike, visibility had been reduced by cloud, with the cloud cover being 5-7 OCTA, which is described as broken cloud. As the expert evidence pointed out, an OCTA is a meteorological term identifying in fractions of 8 the part of the sky obscured by cloud where 8 meant total cloud cover.

38 At a meeting on 2 February 2009 at the CASA offices in Bankstown, Mr Harrold again recounted what had happened leading up to the wire strike:

"I explained I had better visibility to the east towards Cessnock and proceeded in that direction. I tracked over part of the range remaining clear of cloud and to my north I had good clearance however the dochra area was in that direction which I did not want to breach. I was referring to the Newcastle VNC map in order for me to identify as best I could the boundary of the restricted area whilst dealing with the deteriorating weather. I was attempting to identify the geographical features of the range back to the map to ensure I did not encroach on the restricted area. I could see the large powerlines running in an east west direction on the valley floor and located them on the map, I believed myself to be out of the restricted area and I was conscious of staying out of the restricted area.

I then crossed over part of the range to the valley en route to Cessnock where I could land or continue on towards Mulbring then coastal to Sydney. I explained that my path across the range looked clear on the chart, there were no masts or powerlines indicated. This gave me a sense of security whilst dealing with the stress of weather and the pressure of getting Mr Pardice to Sydney. ..."

39 Mr Harrold's second statement, dated 17 February 2012, relevantly provides:

"12 My track down from Scone was a little to the East of due South. After I descended through the cloud and as Captain Nest paraphrases in his paragraph 6(d), there was low cloud to the north, low cloud obscuring the high ground to the south, but reasonable helicopter conditions to the Northeast and East.

13 I saw that the low cloud to the north also extended westwards. I saw that the cloud to the north and west (referred to in my original statement in paragraph 145) was something like the profile of a mountain range turned upside down. That is, you could see a solid top to the cloud but underneath patches of cloud extend downwards to various heights (so that there was scattered clouds at a similar altitude to mine), with some low lying patches of mist below around Broke and which, to the best of my recollection, obscured Broke (possibly from the Wollombi Brook and other bodies of water nearby). It appeared to me that the weather behind me was closing in with some cloud moving west to east.

14 Around this point of time with the weather as I have described above having descended below the cloud and having received the text message from Stephen Forgacs (paragraph 152 of my original statement), I had to make a decision (with the assistance of VNC 3).

15 I decided not to continue south for the reasons given in my original statement.

16 I couldn't track north east because that would have taken me through the middle of SATA (Singleton Army Training Area) and close to the firing ranges shown in the north east quadrant of SATA as shown in Annexure A.

17 Having seen the weather behind me (to the north and west) I considered that flying north involved risks with the cloud. I had already descended beneath the cloud for the reasons I gave in my original statement and I did not want to ascend above that cloud because I did not know when, and if, I would be able to sight the ground again or successfully penetrate the cloud layer whilst ascending.

18 I did not consider landing at Broke to be a good option. There was no airfield (unlike Cessnock and Newcastle), there were various mines and there was low lying mist. I was not familiar with the town of Broke and did not know of any safe places to land. I had been taught never to fly low over mines because of the risk of explosive devices being triggered. I was also concerned with the cloud I had seen moving from west to east (towards Broke) that, depending upon how the weather developed may have made landing at Broke more dangerous.

19 Towards the east, as I said in paragraph 158 of my original statement, I could see that the visibility was clearer and brighter, although there was still some cloud and the clearance between the ground and the base of the cloud was greater. Captain Nest seems to confirm this in his paragraph 6(d) where he says that the cloud base to the east (and north east) varied between 500 feet and 1000 feet above ground level.

20 Once over the range, the ground then fell away substantially so that even though my altitude would not change substantially, my height above ground would.

21 With the limitations of VNC 3, as to the boundaries of the restricted area, the cloud to the east being a reasonable height above ground and no powerlines marked on VNC 3, other than the main transmission lines well to the north, my judgment was that the safest option in the circumstances was to hug the southern boundary of the restricted area and fly in this 500 to 1000 foot clearance between the ground and the base of the cloud for a few kilometres until I reached Cessnock or perhaps Newcastle where I could land safely if the weather was to deteriorate further. By the time I made this decision and commenced tracking east I estimate I was about a couple of nautical miles south of Broke.

22 It is correct to say that this course involved a short distance of low flying and the need to hug the boundary of the restricted area but the visibility was clear and in the circumstances of the weather around me, and how it was developing, I judged this was the safest option."

40 In oral evidence, Mr Harrold said that he was aware as a matter of general knowledge of the existence of the SATA although he did not recollect flying close to it on any previous occasion. He was aware that there was a process for a pilot who wished to fly over a restricted area which involved calling Air Traffic Control and seeking a clearance. He agreed that on the morning of the flight, he had a full tank of petrol which should have provided him with three hours of flying time with half an hour reserve. One hour of flying time had been used flying from Rosehill to Scone and approximately 30 minutes before the wire strike.

41 In oral evidence, Mr Harrold agreed that as he approached Broke there was cloud to the south and that it extended vertically as well as horizontally and that there was some cloud behind him (Black 143W, 144P). At that time the helicopter was a couple of thousand feet above ground level. He described the cloud to the south as "pretty solid" without any breaks in it. When Mr Harrold decided to descend, he did not have a clear view of the land. There was some cloud and some breaks in the cloud (Black 157L).

"Q. From the point of commencement of the descent you had unimpeded view of land below you, didn't you?

A. I could see land and I flew through that gap in the cloud and descended the aircraft." (Black 158N)

The descent brought the aircraft to approximately 500 feet above ground level.

42 Mr Harrold's evidence was that he kept the range of hills on his right. He accepted that the high point of Mount Broken Back (Trig 1943) was to his right because he could not see it. It was obscured by cloud. He said:

"A. Well quite a bit of the range was obscured by cloud and I assumed that that part of the range was as well." (Black 164S)

43 In relation to whether that placed him in restricted airspace he said:

"Q. You knew you were in restricted airspace, didn't you?

A. I knew there was a chance, a good chance of being there, yes, at that stage of the flight. I was there for a good reason. I was avoiding the cloud." (Black 165K)

"A. I was aware that there was a chance that I could be in restricted airspace, or be on the boundary anyway. And then as I, as you quite rightly say, as I progressed further as a result of having to maintain VFO or not flying IMC, I deferred slightly to the north of the range." (Black 166L)

44 It was put to Mr Harrold that from the moment that he turned east near Broke he knew that he would be flying over restricted airspace. Mr Harrold denied that proposition:

"A. No, because I couldn't, as I turned just I don't know if you can make that out on the map but I turned sort of to the southeast of what I consider Broke because I went into that little valley and then I remember turning to the turning the aircraft and tracking along the contour. Which then, at that stage I thought I might quite possibly be able to get over the range and stay outside the restricted airspace. But as I tracked further to the east, it became evident to me that I couldn't - I wouldn't take that option because of the visibility and the cloud and I did track slightly to the north of the range which most likely put me just inside the restricted airspace, okay, which I was aware of, but it was the highest and clearest point through to the east." (Black 167L - P)

"Q. At this stage you were navigating by reference to the mountain range to your right, and the high voltage powerlines to your left, is that right?

A. More or less, yeah, yep.

Q. What do you mean more or less?

A. Well they were the dominant sort of features I could see or I would have the best chance of seeing.

Q. You could see them couldn't you?

A. I could see the range and I could see elements of the easement down to the north of me, at my left hand side.

Q. The fact is you had a clear view out to the left didn't you?

A. Absolutely not. I did not have a clear view, didn't have a clear view it was still cloud.

Q. It was all above you wasn't it?

A. No. No, there was cloud above me and there was cloud, mist, you know, to the north.

Q. Cloud mist?

A. Yeah, well it was like --

Q. What, you're a pilot, Mr Harrold, really.

A. Sorry. There was low, there was some cloud to the north of the aircraft which was out the left hand side.

Q. How far north?

A. It extended a fair way, I couldn't, I don't know I'm talking about a couple of miles I could see with that cloud in it here and there and I could make out the easement of the transmission line east/west.

Q. So you say that the cloud to the north was a couple of miles away?

A. No, no, it was, it extended over the top of me, if anything it sort of moved, it sort of descended a little bit to the north." (Black 173K - 174C)

"Q. So what you saw, to the extent that it was below your altitude, what was to the north was mist?

A. Mist cloud, mist cloud, it was obscuring my unimpeded vision of the north, of the Dochra or restricted airspace.

Q. You had also a view of the road that's on the VNC map at that point didn't you?

A. No, I didn't see the road.

Q. Didn't see any road?

A. No.

Q. What is it that led you to fly as close as you did to the escarpment rather than say 500 metres to the north?

A. Because that would have meant I would have had to descend a bit further to the north and I was trying --

Q. Why?

A. Well because it's a cloud over the top of, it descended down to the north. So I chose what I considered to be the safest route, which was maintaining my altitude and remaining clear of cloud." (Black 174M-V)

"Q. So you knew what you needed to be concerned about was the top of the range to your right?

A. Yes, but then if I, if I flew any further out to the north then that would have lowered my altitude so it would have been an issue then with the distance above the ground.

Q. Yes, but I put it to you that you knew that you were actually at a negative altitude when measured by reference to 300 metres - to the highest point within 300 metres and if you had gone north you'd have been necessarily at a positive altitude?

A. I couldn't go north because I would have gone into cloud.

Q. Well you've just told us that the land was dropping away steeply to your left?

A. Yeah.

Q. So it was an option to go to the left, wasn't it?

A. No, because I'm trying to explain to you the cloud lowered as it went to the north.

Q. Yes, it didn't lower down to the ground, did it?

A. It seemed to further - well further north it did.

Q. Yes, more than 2 miles to the north. You saw this cloud for 2 miles to the north, didn't you?

A. It gradually went down, that's right, and gradually descended to the north so any track of mine to the north would have put me lower, under the cloud, further into the restricted area, right, and possibly down lower to the ground below me." (Black 175X - 176M)

45 By reference to par [158] of his first statement, the following questions were put to Mr Harrold:

"Q. Did you see the cloud steeply bank down to join the ground about 2 nautical miles north of the edge of the range?

A. I saw the cloud, yes, basically descending further to the north. I was looking past that, underneath that to the east.

Q. Right.

A. Yep and as I said it was brighter. When you get, you get a sense you can see brighter areas and darker areas and that's what I could see.

Q. You see when you wrote 158 you did not have in your mind's eye that there was any bank of cloud descending down to meet the ground 2 nautical north did you?

A. I know I saw what I saw.

Q. And you didn't see that did you?

A. Yes I did.

Q. That's a lie, isn't it?

A. No it certainly is not a lie." (Black 182N-V)

"Q. You had a clear view of the mountain range and the cloud above it didn't you?

A. When I say clear view, it wasn't like a completely unobstructed view but it was a, I clearly knew that was the range to south, that's what I meant by.

Q. That's what you meant when you said that you had a clear view of the mountain range and the cloud?

A. Yes, well I wasn't going to run into the mountain range so I could see the mountain range.

Q. Yes, so you could see clearly from your point where you'd completed the descent through to the mountain range?

A. Yes, with some, with cloud and other, yeah, I could, not level, there was some cloud but I could still see the vegetation or the dark mountain range outside the picture.

Q. You could see land between the mountain range and your position, couldn't you?

A. No. Sorry, land, can you explain?

Q. Yes, you could see terrain that lay between your position south to the mountain range couldn't you?

A. It was, there was fog and mist on the lower part of the, below me to the north, sorry, to the south and I recall seeing the terrain lifting to the south, that's what I recall seeing, yes." (Black 184F-Q)

"Q. You proceeded to the point where you turned left. At the point you turned left, had you considered landing?

A. I had. I considered a couple of options. I considered landing and going back on top of the cloud, and I didn't consider that to be safe to try to track back and go through the cloud and landing I considered also not to be a safe option given the other option I had which was to track along the range and maintain visibility with the range and fly to a more easterly direction where it was brighter and clearer or appeared brighter and clearer.

Q. You did not, in considering landing, consider the option of tracking north under the cloud to a suitable landing spot, did you?

A. No, I didn't think that tracking north was going to provide me with any better landing spot given that the cloud base was as low as it was and visibility was poor.

Q. But you were under the cloud base at all times?

A. I was under the initial cloud base, but there was cloud and mist at my level.

Q. You were clear of cloud at all times?

A. I was clear of cloud, but then that cloud and my altitude, that that cloud does hamper my visibility looking forward, but I was clear of cloud.

Q. Do you say you had less than 800 feet visibility looking forward?

A. 800 metres?

Q. Yes, less than 800 metres visibility looking forward?

A. I might have been confronted with the odd occasion where that might have been the case, but yes.

Q. You didn't at any time seek a clearance to overfly a restricted area, did you?

A. No, I didn't.

Q. You didn't ever consider seeking a clearance, did you?

A. At the time I was concerned about moving on from that area as best I could and I was just looking at the best option to get myself out of an area that was deteriorating, as far as I was concerned. And that gave me the - you know, I tracked to the south to the range and I didn't consider asking for a clearance. It could have taken some time to get one. So, yeah, that's why I didn't consider it.

HIS HONOUR:

Q. Given the sequence of events that would be required in obtaining a clearance, do you have any idea how long that would take?

A. Well it could take, it could take minutes, it could take 10 minutes, I don't know. I've certainly had experiences where I've asked for a clearance in the past at other areas when it's taken 20 minutes to get a clearance." (Black 188Y-189W)

"Q. At that point your earlier evidence was what you saw was a solid top to the cloud but underneath patches of cloud extending downwards to various heights, so that there were scattered clouds of a similar altitude to yours with some low lying patches of mist below around Broke. That's what you said in that statement, there's no mention of cloud or fog around Broke is there?

A. That was, there was definitely cloud in Broke because I didn't see Broke but I think it's, sorry, it's a given when I said patches of mist and cloud, low line patches of mist below around Broke so I think adequately explained that there is mist or - I didn't use the word "fog" but there was certainly moisture obscuring my view." (Black 191R-W)

"Q. It's not the case, is it, that you saw any evidence of the weather closing in from west to east?

A. Look, yeah with the weather it was certainly closing in around me with it, it was moving from west to east is something that I couldn't be sure of, but it was certainly appeared to be closing.

...

HIS HONOUR:

Q. What does closing mean? Does it mean you're getting closer to the weather or the weather is getting closer to you?

A. I think it's becoming yeah, the options are becoming less for me to, you know, fly to other - there's less options for me at the time where I was. The weather is deteriorating I suppose is what I was - better --

Q. Does it mean the closer you get to cloud the less options you have?

A. Yes.

Q. Is that what you were meaning to convey or something else?

A. I was meaning to convey it was deteriorating around me, I suppose." (Black 192E-O)

"HIS HONOUR:

Q. What is the process of declaring an emergency? Do you declare an emergency as you land and just present it as fait accompli or do you still need permission?

A. I think you've got to be in imminent danger to declare it. I think you can land." (Black 192U)

"COUNSEL:

Q. So you've never referred to clouds being present to the north of your east track before today, and the reason you gave why you couldn't be flying north or your east track was the presence of the Army range, do you accept that?

A. Yes, it was one of the reasons, yes.

Q. That was the only reason you had for not travelling to the north of where you were, wasn't it?

A. That's not right, but I should have paid more attention how I wrote this statement, but yeah.

Q. You see you've attached to your second statement a map of the Army Training Area, haven't you?

A. Yeah, that was provided to me by my solicitors, yes." (Black 194R-V)

"Q. You didn't at any point contour fly along the edge of the range, did you?

A. I did the whole time.

...

BRENNAN: I'm sorry, contour flying is flying along terrain adjusting your altitude to keep an adequate separation between the aircraft and the terrain.

Q. Is that correct?

A. Yeah, I flew beside the range and kept an altitude that was more or less the same throughout as best I could. But I flew that contour.

Q. So you say that you did not fly in a straight line, you flew along a path that reflected the contour of the range?

A. Yes." (Black 195P-W)

Resolution of factual issues

46 The nature of the challenge to the findings of the trial judge as to weather conditions can be seen from the following extracts from the appeal transcript:

"One is that his Honour took the view that weather was closing in which forced him on. It was a finding of a catchphrase that was never defined. There was never evidence to suggest any speed at which cloud was moving or assembling or thickening." (AT 9.43)

"But clearly, at 1,370 feet above height datum, which is where he must have been, having regard to the intersection with the wire, he was well below that cloud and there was no suggestion of any cloud or weather immediately to the north of him - that is within a range of about 040 or 500 metres to the north of him - which would have stopped him from flying further out from the escarpment. He was flying close to the escarpment for the reason given." (AT 11.36)

"His Honour's findings repeat over and over this expression "weather closing in" which, with the greatest respect to his Honour, is completely meaningless - never defined in anybody's evidence. The only thing that was ever said about it when his Honour asked, "What do you mean by closing in?" was that he said, "It was deteriorating around me." (AT 12.17)

"Quite so, but the other factor that it's important to is this supposed weather closing in. When one reads the judgment, which I'll come to shortly, one would have the impression that this aircraft was scudding before a storm. It is nothing like it. His Honour never had any evidence to suggest that the rate of development of cloud, whether thickening through rising moisture or fog or change in temperature, inversion layers or the like, never had any evidence of what exactly the cloud was doing." (AT 14.14)

47 With great respect to senior counsel for the appellant, these submissions do not properly reflect the evidence. Implicit in them is a requirement for a level of precision which would seldom, if ever, be found in any description of events leading up to an accident given by one of the protagonists. While lawyers might wish for more detail, it needs to be kept in mind that what was being described was an evolving situation developing while the helicopter was travelling at approximately 150 kph. In any event, there was ample evidence to support the trial judge's conclusions.

48 There was the evidence of Mr Hodge at [30] of cloud moving in behind, from west to east.

49 In his statement of 17 February 2012 Mr Harrold said that he observed low cloud to the north and low cloud obscuring the high ground to the south. The low cloud to the north extended westward. He likened the appearance of the cloud to the profile of a mountain range turned upside down, i.e. a solid top to the cloud, but underneath patches of cloud extending downwards to various heights.

50 In his oral evidence Mr Harrold made it clear that the cloud was sufficiently thick around Broke that he could not actually observe the town and although he was aware of the location of the high point of Mount Broken Back, he could not observe it because of the cloud. He was definite that he did not have a clear view to the north nor to the south because of cloud. A matter which the cross-examiner did not appear to appreciate was that the cloud to which Mr Harrold referred was not separately located to the left and right (north and south) but was continuous and extended over the top of the helicopter. Mr Harrold said:

"No, no, it was - it extended over the top of me, if anything it sort of moved, it sort of descended a little bit to the north." (Black 174C)

51 The cloud was sufficiently thick that although he could see the powerline easement marked on the VNC map, he could not see the road. Mr Harrold said:

"Well because it's cloud over the top of, it descended down to the north. So it shows what I considered to be the safest route which was maintaining my altitude and remaining clear of cloud." (Black 174V)

"I couldn't go north because I would have gone into cloud." (Black 176E)

52 Important evidence is that given at Black 192 where Mr Harrold said:

"Look yeah with the weather it was certainly closing in around me with it, it was moving from west to east is something that I couldn't be sure of, but it was certainly appeared to be closing.

Q. What does 'closing' mean? Does it mean you're getting closer to the weather or the weather is getting closer to you?

A. I think it's becoming, yeah the options are becoming less for me to, you know, fly to other - there's less options for me at the time where I was. The weather is deteriorating I suppose is what I was - better -

Q. Does it mean the closer you get to cloud, the less options you have?

A. Yes.

Q. Is that what you were meaning to convey or something else?

A. I was meaning to convey it was deteriorating around me I suppose."

53 There is a real immediacy about the expressions "the weather was certainly closing in around me ... it was deteriorating around me". Those descriptions do not require further definition or close analysis. By reference to the cloud, the mist, his altitude, the topography and the weather generally, Mr Harrold was describing a deteriorating situation. Accordingly, the appellant's submission that there was no evidentiary basis for his Honour's findings at [23] hereof has not been made out.

54 There were other factual findings by the trial judge which were challenged. The appellant submitted that his Honour's finding at [127] (Red 64P) to the effect that at the time of the wire strike, the helicopter was approximately 500 feet above ground level, was not open. By reference to the length of the overhead wires which were struck (1,060 metres) and the point at which the wire was broken (350 metres) the appellant calculated that the distance above ground level was approximately 365 feet at the point of strike. While it was generally agreed that this height could not be determined with any precision, given the inevitable sag in the wire over such a distance, it was a reasonable approximation. The respondent implicitly accepted that proposition in the appeal and noted that he had made a similar submission in the trial. Accordingly, I accept that his Honour erred in that finding. Ultimately, however, nothing turns on that issue.

55 The appellant challenged his Honour's finding (at [109] Red 61E and [116] Red 62N) that fuel had become an issue for Mr Harrold and that this further justified his decision to fly east towards Cessnock. The appellant submitted that by the time Mr Harrold reached Broke, he had been flying for about 40 minutes on the return journey so that he had plenty of fuel left, i.e., 1 hour and 20 minutes of fuel plus a half hour reserve (AT11.16).

56 That submission is not made out. Mr Harrold's evidence was that one of the risks which he had to take into account was that he would be caught above cloud level and if there was no break in the clouds through which he could descend, the aircraft could run out of fuel. This was clearly a genuine concern because he spoke to Mr Hodge about it just before the aircraft reached Broke ([31] hereof, Black 206P, Blue 402X).

57 The appellant submitted that his Honour's finding at [115] Red 62D-G to the effect that Mr Harrold correctly considered that it was unsafe to seek a landing place in the vicinity of Broke, was not open on the evidence. This was because there was no evidence to justify the possibility of explosions due to mining activity taking place around the Broke area. While the submission concerning the possibility of explosions is made out, it provides only a partial answer to his Honour's finding.

58 The evidence of Mr Harrold was that he had not previously landed in the Broke area and was unfamiliar with it. He was aware that mining was taking place in the area and that this of itself would render landing in an unfamiliar location potentially dangerous. While that is an appropriate explanation by Mr Harrold, the real issue is not whether it was possible to land at Broke or nearby, or whether it was reasonable for Mr Harrold to have landed the helicopter at Broke. It is whether in the circumstances it was reasonable for him to continue flying as he did. Just because it may have been reasonable for him to have landed at Broke, does not preclude it also being reasonable for him to continue with the journey. Captain Nest in his report said:

"Landing should be considered as a possible option for the helicopter pilot, but it is not always the first option if there are other ways to safely conduct the flight." (Blue 575T)

59 The appellant submitted that his Honour's finding at [118] Red 62R, to the effect that turning back to Scone was not an acceptable option on account of clouds, was not open on the evidence. This was because there was no evidence that there was a build up of clouds behind the aircraft.

60 That submission is not made out. Not only was there evidence from Mr Harrold and Mr Hodge to the effect that cloud was moving in behind the aircraft, but Mr Harrold consistently referred to cloud build up to the north. He described weather moving west to east and closing in around the aircraft which was clearly a reference to clouds. It follows, therefore, that there was ample evidence to the effect that turning back was not a viable option (see [52] hereof).

61 The appellant submitted that his Honour erred in rejecting as an alternative that the pilot could have sought permission from the Army to fly across the SATA ([188] -[197], Red 78M-80P). The basis for this submission was the appellant's primary position, i.e. that the evidence did not justify a finding that the weather and in particular the clouds were closing in about the aircraft (AT 30.36 - .44). That primary submission by the appellant has been rejected.

62 There are, however, other valid bases for rejecting the submission. These are, in effect, set out by the trial judge in his reasons (at Red 78R - 80P). The alternative of hovering and orbiting for perhaps up to 20 minutes, in circumstances where weather conditions were deteriorating, was clearly problematic. This is particularly so when there was clear air to the east, the distance to Cessnock was comparatively short and it would only take a matter of minutes to achieve. Perhaps the best explanation is that given by Mr Harrold himself:

"Q. You didn't ever consider seeking a clearance did you?

A. At the time I was concerned about moving on from that area as best I could and I was just looking at the best option to get myself out of an area that was deteriorating, as far as I was concerned. And that gave me the - you know I tracked to the south to the range and I didn't consider asking for a clearance. It could have taken some time to get one. So yeah, that's why I didn't consider it." (Black 189Q - S).

63 The appellant submitted that his Honour's findings at [119] - [125], Red 62X-64K were erroneous because his Honour failed to have regard to the expert evidence on these issues. The appellant submitted that both Captain Nest and Mr Townsend had concluded that Mr Harrold had made mistakes in his navigation, causing him to place himself in unauthorised airspace above the SATA. The appellant submitted that Mr Harrold by trying to avoid the southern boundary of the SATA had been forced to fly over rising ground, close to the escarpment of Mount Broken Back. The appellant submitted that in effect what Mr Harrold had done was to trap himself between the SATA boundary to the north and rising ground to the south. The appellant submitted that this had forced Mr Harrold when heading east to fly too low in exactly a location where a wire might be strung.

64 This submission needs to be assessed against the rejection of the appellant's primary factual submission and the acceptance that travelling east with the intention of skirting the southern edge of the SATA was forced on Mr Harrold by the extent of the cloud cover. It also needs to be kept in mind, as Mr Nest pointed out, that the VNC apart from being a very small scale map did not show contours but only significant geographical markers such as roads, major powerlines and specified high points. Unless one was familiar with the SATA and surrounding terrain (which Mr Harrold was not) its boundaries could not easily be determined from the air. This was particularly so when the cloud concentration was such that although Mr Harrold could see the powerline easement, he could not see the road on the boundary of the SATA, i.e. he was unable to identify a key geographical feature. It also needs to be kept in mind that the helicopter was at this time travelling at approximately 150 kph. The time for decision making was short. The fact that Mr Harrold flew into the southern edge of the SATA was not necessarily due to poor navigation, but the exigencies of the weather conditions and his inability to identify crucial geographical features due to those weather conditions (Blue 574F-P, 640D-G).

65 In his statement of 17 February 2012 (Blue 589N-T), Mr Harrold explained his decision making:

"21 With the limitations of VNC 3 as to the boundaries of the restricted area, the cloud to the east being a reasonable height above ground, and no powerlines marked on VNC 3 other than the main transmission lines well to the north, my judgment was that the safest option in the circumstances was to hug the southern boundary of the restricted area and fly in this 500ft to 1,000ft clearance between the ground and the base of the cloud for a few kilometres until I reached Cessnock, or perhaps Newcastle where I could land safely if the weather was to deteriorate further. By the time I made this decision, and commenced tracking east, I estimate I was about a couple of nautical miles south of Broke.

22. It is correct that to take this course involved a short distance of low flying, and the need to hug the boundary of the restricted area, but the visibility was clear and, in the circumstances of the weather around me and how it6 was developing, I judged that this was the safest option."

66 It is significant that at the time of the wire strike, Mr Harrold had almost cleared the range and was only minutes away from Cessnock. The dangers which he identified of the weather closing in behind him and to the north and south had been largely overcome. The wire strike occurred not because Mr Harrold had trapped himself between the range and the SATA but because a powerline was unmarked, not recorded on any map and located in a position where it could not have reasonably been anticipated by a pilot. The powerline because of its position was described by Mr Townsend as an unusual one, i.e. "this particular wire that was hit, in this instance, is one of the abnormal ones. They do exist, obviously, and coming from the top of one obstacle to the ground is what creates this as slightly different from a normal wire environment" (Black 286C).

67 There was no suggestion in the evidence that absent the powerline, either the helicopter's position within SATA or its height above ground level of themselves would have caused damage to the helicopter or have interfered with its safe arrival in Cessnock or elsewhere. The characterisation of those hazards as foreseeably contributing to the accident is very much based on hindsight. Mr Townsend made the obvious comment that live rounds in a military live firing range were not going to be fired onto its boundary but in a more central location (Blue 642Y).

68 The appellant submitted that his Honour's fact finding as to the reasonableness of Mr Harrold's decision making was erroneous because he had failed to have due regard to the opinion of the experts. The appellant relied particularly upon the joint opinion of the experts (Blue 740) which was as follows:

"Question

From PT of descent of helo from Broke, is there evidence of a departure from the standard of care of a helo pilot of ordinary skill and competence?

If yes, in what respects?

If not, why not?

Yes, in terms of:

- Appreciation of position in respect of the restricted area was not to that expected of a pilot of ordinary skill and competence.

- The navigation techniques used were not that expected of ordinary skill and competence this has resulted in entry into R532.

- Under the favourable weather conditions in evidence, the pilot's actions were appropriate until the point of choosing to low fly somewhere prior to the wire strike. This ignores the aspect of entry into R532.

- Under the unfavourable weather conditions in evidence, the pilot's actions were appropriate until the bottom of the descent. The ground level cloud/fog/mist in evidence, and the visibility reported are indicative of conditions below that which were suitable for the safe conduct of flight.

- There are other aspects beyond the points in time discussed above, where appropriateness of actions are subject to some disagreement."

69 His Honour clearly had regard to that material since he set it out in his judgment ([145], Red 68Q-69H). His Honour made the obvious point that Mr Harrold's duty was not to make the best decision in the circumstances but to act reasonably in his decision making having regard to the expertise to be expected of a competent helicopter pilot. His Honour noted the strong element of hindsight in the opinion of the experts and the apparent failure by them to recognise the quickly changing circumstances and the dynamic nature of the decision making required of Mr Harrold.

70 As his Honour appreciated, the persons in the best position to assess weather conditions and conditions generally were Mr Harrold and Mr Hodges. Quite clearly the "favourable weather conditions" scenario in the joint opinion can be rejected. Implicit in the "unfavourable weather conditions" scenario considered by the experts is an assumption that an emergency situation had developed. That is not how I interpret the evidence. While weather conditions due to increase in cloud were clearly deteriorating, there continued to remain a reasonably clear path to the east albeit interspersed with some low cloud.

71 The criticism of Mr Harrold's navigation has already been addressed. It failed to take into account the limited nature of the VNC, Mr Harrold's unfamiliarity with the SATA and this terrain, and that key geographical features (such as the road) were obscured by cloud. Accordingly, not only did his Honour take into account the opinions in the joint report of the experts but he specifically dealt with those issues in his judgment.

72 There is another difficulty which arises from the form of the experts' reports. They were, of course, written by persons unfamiliar with the law and there is a significant element of hindsight in the approach which they adopted. Too close a reliance upon their conclusions would incorporate that error into the judgment. The correct approach is that stated by Hayne J in Vairy v Wyong Shire Council [2005] HCA 62; 223 CLR 422 at [126]:

"126 When a plaintiff sues for damages alleging personal injury has been caused by the defendant's negligence, the inquiry about breach of duty must attempt to identify the reasonable person's response to foresight of the risk of occurrence of the injury which the plaintiff suffered. That inquiry must attempt, after the event, to judge what the reasonable person would have done to avoid what is now known to have occurred. Although that judgment must be made after the event it must seek to identify what the response would have been by a person looking forward at the prospect of the risk of injury."

73 By contrast the approach by the experts is of the kind which has been consistently deprecated by the courts. In Vozza v Tooth & Co Ltd [1964] HCA 29; 112 CLR 316 at 318 Windeyer J said:

"It may seem that, because an accident has happened and a workman has been injured, his employer is liable for damages if it can be shown that, by some means, the accident might have been avoided. That is not so."

Similarly, in Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11; 243 CLR 361 at [19] French CJ and Gummow J said:

"19 Two things must be said as to the formulation of a duty of care and its scope and content. First, there is an inherent danger in an action in negligence to look first to the cause of damage and what could have been done to prevent that damage, and from there determine the relevant duty, its scope and content."

74 Another difficulty is that the experts approached the Civil Aviation Regulations (CAR) as though they constituted particulars of negligence in absolute terms and that any breach of a regulation would constitute a negligent act.

75 That, of course, does not necessarily follow. The correct approach is that explained by the High Court in Leighton Contractors Pty Ltd v Fox; Calliden Insurance Limited v Fox [2009] HCA 35; 240 CLR 1 at [49] where the Court (French CJ, Gummow, Hayne, Heydon and Bell JJ) said:

"49 The obligation imposed on Leighton under the Regulation, while not founding an action for breach of statutory duty, is central to the Court of Appeal's conclusion that a common law duty existed. While it is true that obligations under statutory or other enactments have relevance to determining the existence and scope of a duty, it is necessary to exercise caution in translating the obligations imposed on employers, principal contractors and others under the OHS Act and the Regulation into a duty of care at common law. This is because, as Gummow J explained in Roads and Traffic Authority (NSW) v Dederer, "whatever their scope, all duties of care are to be discharged by the exercise of reasonable care. They do not impose a more stringent or onerous burden."

50 The Court of Appeal gave no consideration to whether Leighton had implemented a reasonable system for ensuring that workers coming onto the site were identified, were required to undergo site induction and were required to show evidence of completion of general and work activity based OHS induction training. The parts of the critical passage which were emphasised in the above quotation indicate that the liability that was imposed on Leighton was special or strict - a duty to provide induction training. ..."

The error identified by the High Court in Leighton Contractors v Fox was the expression of the duty in absolute terms as specified by the statute rather than having regard to concepts of reasonableness.

76 Once the factual basis for his Honour's finding that the weather was closing in and thereby reducing the options available to Mr Harrold is accepted, his analysis of breach of duty and causation is unexceptionable. In that regard, I note that no challenge was made to his Honour's finding that CAR 140 and CAR 157 did not confer a private right of action on the plaintiff but that their object was the control and regulation of air traffic generally. Those regulations relevantly provided:

"140 Prohibited, restricted and danger areas

(4) The pilot in command of an aircraft must not fly the aircraft over a prohibited area.

Penalty: 25 penalty units.

(5) The pilot in command of an aircraft must not fly the aircraft over a restricted area if the flight is not in accordance with conditions specified in the notice declaring the area to be a restricted area.

Penalty: 25 penalty units.

(6) If the pilot in command of an aircraft finds that the aircraft is over a prohibited area or a restricted area in contravention of sub-regulation (4) or (5), the pilot must:

(a) Immediately have the aircraft flown to a position where it is not over the area; and

(b) when the aircraft reaches a position where it is not over the area, report the circumstances to Air Traffic Control; and

(c) land at such aerodrome as is designated by Air Traffic Control and, for that purpose, obey any instructions given by Air Traffic Control as to the movement of the aircraft.

Penalty: 25 penalty units.

(7) An offence against sub-regulation (4), (5) or (6) is an offence of strict liability.

157 Low Flying

(1) The pilot in command of an aircraft must not fly the aircraft over:

(a) Any city, town or populous area at a height lower than 1000 feet; or

(b) any other area at a height lower than 500 feet.

Penalty: 50 penalty units.

(2) An offence against sub-regulation (1) is an offence of strict liability.

(3) A height specified in sub-regulation (1) is the height above the highest point of the terrain, and any object on it, within a radius of:

(a) in the case of an aircraft other than a helicopter - 600 metres; or

(b) in the case of a helicopter - 300 metres;

from a point on the terrain vertically below the aircraft.

...

(4) Sub-regulation (1) does not apply if:

(a) through stress of weather or any other unavoidable cause it is essential that a lower height be maintained ..."

77 Section 30 of the Civil Aviation Act 1988 (Cth) provided:

"Weather etc to be a defence

(1) In any proceedings for an offence against this Act or the Regulations, it is a defence if the act or omission charged is established to have been due to extreme weather conditions or other unavoidable cause.

(2) Any defence established under sub-section (1) need only be established on the balance of probability."

78 To the extent that the appellant relied upon breaches of those Regulations as particulars of negligence they have to be read on that basis, i.e. not as involving strict liability as is specified in the terms of the Regulations but in the context of a claim in negligence (Para 14 of the Amended Statement of Claim, Red 3R). The particulars of negligence should therefore be read as an obligation "to exercise reasonable care so as to not fly the helicopter into restricted airspace" and "to exercise reasonable care so as not to fly the aircraft below a height of 500 feet above ground level". That, however, was not the approach followed at trial.

79 At trial it was assumed that the respondent through Mr Harrold owed the appellant a duty of care but the duty and its content do not seem to have been articulated. To the extent that it is necessary, I would state the duty of care in general terms as a duty to take reasonable care in flying the helicopter so as to avoid injury to its passengers and damage to the aircraft.

80 As the parties appreciated, the question of breach was to be determined by reference to ss 5B and 5C CLA. Those sections provide:

"5B General principles

(1) A person is not negligent in failing to take precautions against a risk of harm unless:

(a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and

(b) the risk was not insignificant, and

(c) in the circumstances, a reasonable person in the person's position would have taken those precautions.

(2) In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things):

(a) the probability that the harm would occur if care were not taken,

(b) the likely seriousness of the harm,

(c) the burden of taking precautions to avoid the risk of harm,

(d) the social utility of the activity that creates the risk of harm.

5C Other principles

In proceedings relating to liability for negligence:

(a) the burden of taking precautions to avoid a risk of harm includes the burden of taking precautions to avoid similar risks of harm for which the person may be responsible, and

(b) the fact that a risk of harm could have been avoided by doing something in a different way does not of itself give rise to or affect liability for the way in which the thing was done, and

(c) the subsequent taking of action that would (had the action been taken earlier) have avoided a risk of harm does not of itself give rise to or affect liability in respect of the risk and does not of itself constitute an admission of liability in connection with the risk."

81 His Honour set out his analysis of breach of duty at [169] - [201] (Red 74J-82D). If one were to be critical of his Honour it would be that he did not in terms define the relevant "risk of harm". In applying s5B, it is important to accurately identify the relevant risk of harm since it will usually govern how the other considerations in s5B are to be applied.

82 The importance of identifying the "risk of harm" was stressed in Roads and Traffic Authority (NSW) v Dederer [2007] HCA 42; 234 CLR 330. In the Court of Appeal the majority characterised the risk to the plaintiff as "serious spinal injury flowing from the act of diving off the bridge". This was a risk said to have been created by the erection of the bridge. However, Gummow J noted that this characterisation of the risk obscured the true source of potential injury which was not the erection of the bridge or any characteristic of the bridge, but rather the possibility of impact upon jumping into the potentially shallow water arising from the shifting sands of the estuary ([60] - [62]). This mis-characterisation of the risk led to two further errors. First it incorrectly focused attention on the frequency of the antecedent conduct, namely jumping and diving, and not the probability of the risk occurring as a result of that conduct, namely impact in shallow water. This prevented a proper evaluation of the probability of that risk occurring. Second it resulted in a focus on the RTA's role in creating the bridge and overlooked the lack of control the RTA had over the events that gave rise to the risk properly identified, namely the plaintiff's voluntary action in diving and the natural variations in the depth of the estuary beneath the bridge.

83 In accordance with that guidance, I would have assessed the "risk of harm" as the possibility of the helicopter coming in contact with an unmarked obstruction which was not recorded on any map and which was virtually invisible from the air. The foreseeable risk of that occurring would be low. Such an approach might well have ended the inquiry as to breach at that point.

84 As it was, his Honour, at least implicitly, identified the risk of harm somewhat more widely, i.e. the possibility of the helicopter coming in contact with a structure, without the important qualification that such a structure was virtually invisible from the air. Such an approach was generous to the appellant but even on that basis, his Honour asked and answered the questions posed by s5B adversely to the appellant. The preceding analysis of the various challenges made by the appellant to his Honour's fact finding has covered the issues raised by s5B. There is no need to repeat that analysis here.

85 Subsection 5C(b) was important in this case, particularly when considering the expert evidence. This was very much a case where the risk of harm could have been avoided by doing something in a different way, but that of itself is not indicative of negligence.

86 Most particularly, when considering the risk of harm and the application of ss5B and 5C generally, the risk was not and could not be the possibility of being trapped between the SATA and the rising ground. That was not the sort of risk which eventuated but it was the risk identified by the appellant which was said to be caused by both Mr Harrold flying into the SATA and flying at a height below 500 feet above ground level.

87 Nothing was said in the judgment, or apparently at trial, about the issue of causation. That, of course, is provided for by s5D CLA. Relevantly, that provision states:

"(1) A determination that negligence caused particular harm comprises the following elements:

(a) That the negligence was a necessary condition of the occurrence of the harm (factual causation), and

(b) That it is appropriate for the scope of the negligent person's liability to extend to the harm so caused (scope of liability).

(2) In determining in an exceptional case, in accordance with established principles, whether negligence that cannot be established as a necessary condition of the occurrence of harm should be accepted as establishing factual causation, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party."

88 What we are concerned with here is factual causation. Guidance as to the application of s5D(1)(a) was provided by the High Court in Strong v Woolworths Ltd & Anor [2012] HCA5; 246 CLR 182 at [20] where the plurality said:

"20 Under the statute, factual causation requires proof that the defendant's negligence was a necessary condition of the occurrence of the particular harm. A necessary condition is a condition that must be present for the occurrence of the harm. However, there may be more than one set of conditions necessary for the occurrence of particular harm and it follows that a defendant's negligent act or omission which is necessary to complete a set of conditions that are jointly sufficient to account for the occurrence of the harm will meet the test of factual causation within s 5D(1)(a). In such a case, the defendant's conduct may be described as contributing to the occurrence of the harm. ..."

89 It seems to have been assumed at trial that flying into restricted airspace over the SATA (CAR 140) and flying below 500 feet above ground level (CAR 157) satisfied the "factual causation" requirement under s5D(1)(a). Insofar as flying in restricted airspace is concerned, that assumption is somewhat problematic.

90 It follows that by reference to general concepts of negligence, the requirements of s5B and 5C CLA were not established by the appellant. This does not take into account the application of the regulations, not as sources of duty in themselves, but as particulars of negligence.

91 His Honour dealt with that issue at [202] - [220] (Red 82F-85X). By reference to the statement of principle in Leighton Contractors v Fox his Honour's approach to those particulars of negligence unduly favoured the appellant. Although his Honour found that they did not give rise to independent statutory causes of action, but only operated as particulars of negligence, his Honour then treated those asserted negligent breaches of regulation, as if they operated strictly in accordance with their terms, i.e. imposed strict liability. As was made clear in Leighton Contractors v Fox, the correct approach was to impose an obligation on Mr Harrold to act reasonably so as not to fly within restricted airspace and fly below a height of 500 feet above ground level.

92 Even applying the more stringent test, i.e. that CAR 140 and 157 applied strictly according to their terms, his Honour was satisfied that those regulations had not been breached. That finding was available to his Honour for the reasons which he set out.

93 As his Honour noted, CAR 140 and 157 had to be read in conjunction with s30 of the CA Act. Section 30 created a specific defence in relation to each regulation if the breach were established to have been due to "extreme weather conditions or other unavoidable cause". Moreover, CAR 157 provided its own defence, i.e. "through stress of weather or any other unavoidable cause it is essential that a lower height be maintained".

94 Based on his findings as to the prevailing weather conditions, his Honour determined in the case of CAR 140, that even if they did not qualify as "extreme weather conditions" they did qualify as an "other unavoidable cause". In the absence of any authority on the point, that interpretation was open to his Honour. It is an interpretation which is in accord with the natural meaning of the words. This is so because the incursion into the SATA occurred due to exigencies beyond the control of Mr Harrold. To have flown outside the SATA would have meant flying into cloud which all experts agreed was extremely dangerous.

95 If I am wrong in that conclusion, it does not alter the outcome of this appeal. As is clear from the undisputed facts as to the occurrence of the accident, the incursion into the SATA did not cause the accident. The fact that the helicopter was flying in restricted airspace was not an essential pre-condition to the accident. The essential pre-condition was that the helicopter be travelling at a certain height so as to come in contact with the unmarked powerlines. The presence of the powerlines within the SATA was incidental.

96 Apart from CA s30, CAR 157 has its own defence as part of the regulation. His Honour's findings as to weather conditions certainly appear to satisfy the requirement of "stress of weather". The unanimous opinion of the experts was that it was extremely dangerous for a helicopter to fly into cloud and that in such circumstances, the average survival time was in the order of 37 seconds (Black 306W). This would satisfy the test that it was "essential that a lower height be maintained", i.e. that Mr Harrold fly below the clouds even if this meant flying at a height of less than 500 feet above ground level.

97 No authorities were placed before this Court as to the meaning of these regulations. Ruhani v Director of Police (No 2) [2005] HCA 43; 222 CLR 580 which was said to be authority for the meaning of the phrase "stress of weather" was not in fact authority for that. His Honour did refer to a broadly analogous Canadian case where the phrase "stress of weather" was used in a maritime context. There the phrase was construed to mean "a bona fide apprehension of jeopardy arising in the mind of a reasonably competent and skilful master possessing courage and firmness" (The Ship "May" v R (1931) SCR 374 at 382). That construction supports the approach followed by the trial judge.

98 It follows that even applying a higher test than that which the law required, i.e. the direct application of the regulations, Mr Harrold was not in breach in that he was able to make out the defence available under each regulation. That being so, he certainly satisfied the test which should have been applied, i.e. that he act reasonably to comply with the regulations.

Contract

99 In oral submissions in the appeal, the appellant accepted that there were two agreements in effect at the time of the accident - an agreement in which the aircraft was bailed by the appellant to the respondent and an ongoing management agreement under which the respondent would hangar the aircraft, maintain it, charter it out to people and be entitled to keep the rewards from chartering it out, subject to paying a certain amount to the appellant. In relation to the latter, the appellant accepted that no concluded agreement had been entered into, although draft agreements had been exchanged by the parties.

100 The appellant submitted that in the circumstances of this case, where the activity to be undertaken was heavily regulated by the CAR, and by well understood and detailed rules of flight, a term would be implied as a matter of business efficacy that the helicopter would be handled in a manner which complied with the regulations. If that were so, the appellant submitted, a breach of regulation would constitute a breach of contract and to establish a breach of contract on that basis, would not depend upon proof of want of reasonable care, but on proof of breach.

101 The appellant supported that proposition by reference to what was said in Cheshire & Fifoot Law of Contract (8th edition) at 10.55:

"Where the contract has not been recorded in a document, they are replaced with a single criterion: A term is implied if it is "necessary for the reasonable or effective operation of a contract of that nature in the circumstances of the case".

The learned authors quoted Hawkins v Clayton [1988] HCA 15; 164 CLR 539 at 573, Breen v Williams [1996] HCA 57; 186 CLR 71 at 90 and 123 as authority for that proposition. Specifically, the appellant submitted that it was not necessary for it to satisfy the detailed requirements set out in BP Refinery (Westernport) Pty Ltd v Hastings Shire [1977]UKPCHCA 1; (1994)180 CLR 266 at 283. No submissions to contrary effect were made by the respondent.

102 The appellant otherwise relied upon its written submissions in relation to its claim for breach of contract. This creates something of a problem in that the oral submissions on breach of contract were somewhat different to those in the written submissions.

103 The oral submissions on breach of contract are adequately answered by the analysis of the trial judge at [202] - [220] (Red 82F - 85X) and the discussion at [91] - [98] hereof.

104 The relevant written submissions are at AWS [24] - [59] (Orange 17U - 23C). There were four implied terms there relied upon:

"(a) that the aircraft would be operated safely and so as to avoid collisions with powerlines;

(b) the pilots would exercise due care and skill in the performance of the flight;

(c) the aircraft would be operated in compliance with the Civil Aviation Act 1988 (Cth) and the Civil Aviation Regulations 1988 (Cth) and the Civil Aviation Safety Regulations 1998 (Cth) ("the Civil Aviation Legislation") and;

(d) the pilots would fly the aircraft in accordance with the Civil Aviation legislation." (Orange 17U - 18D)

105 "Implied" term (a) could not be part of the agreement. It is trite to observe that one could operate an aircraft safely and still collide with powerlines particularly if the powerlines were unmarked and invisible from the air.

106 Term (b) was properly implied but does no more than re-state the duty of care in the negligence claim. Arguably it was the only term which could be implied into this agreement because it would pick up taking reasonable care to comply with the CAR.

107 "Implied" terms (c) and (d) (which are in effect the same) would not be implied into the agreement in the way in which they are set out. As already discussed, the "Civil Aviation Legislation" itself allowed for occasions when the regulations did not have to be complied with, e.g. stress of weather or any other unavoidable cause rendering it essential that a height lower than 500 feet above ground level be maintained and a breach due to "extreme weather conditions or other unavoidable cause".

108 The term which should have been implied into the agreement was that the respondent through its pilot would exercise reasonable care so as to comply with the "Civil Aviation legislation", i.e. a term which incorporated CAR 140 and 157 but was expressed in the same way as a particular of negligence based on those regulations. In any event, for the reasons already set out, the appellant failed to establish breach of those implied terms, however expressed.

109 That does not end the examination of contract issues. In the written submissions on appeal, the appellant sought to rely on additional contractual terms not pleaded or relied upon at trial. This can be seen in the AWS at [28] (Orange 18J - Q). These terms raise indemnification provisions which were in the draft agreement which was being discussed by the parties at the time of the accident. Had these terms been included in the pleadings and had argument been raised at trial in relation to them, the form of the contract could have become an issue with perhaps other terms being relied upon by the respondent. In any event, an amendment to the pleadings was required and evidence would have been called by both sides on the issue. It follows that the appellant should not be allowed to raise these new issues on appeal, when they were not raised at the trial (Zheng v Cai [2009] HCA 52; 239 CLR 446, Coulton v Holcombe [1986] HCA 33; 162 CLR 1 at 7-8, Water Board v Moustakis [1988] HCA 12; 180 CLR 491 at 497).

Proportionate liability - CLA Part 4

110 This issue would only arise if liability were found against the respondent in tort. This has not occurred. In deference to the submissions which were made, however, I propose to indicate my opinion in relation to it.

111 His Honour dealt with this matter at [236] - [256] (Red 89W-94C). On the assumption that liability was found against the respondent, his Honour apportioned liability as to 80 percent against Air Services Australia and Energy Australia and 20 percent against the respondent. In doing so, his Honour fell into error. This is because the respondent on the first day of the trial had abandoned any apportionment claim against Air Services Australia. Accordingly, the only question to be considered is whether any liability should be found against Energy Australia, the entity responsible for the erection and maintenance of the powerline and if so, in what amount.

112 There was evidence before the Court to the effect that marker balls which could have been used to mark the powerline, cost $180 each. Given that the powerline was 1100 metres in length, the cost of appropriate marking would have been less than $5000. It was common ground that in 1994 a police helicopter, carrying out an air search for another aircraft, had struck this same powerline. Its pilot confirmed the evidence of Mr Harrold that the powerline was impossible to see from the air. It was also common ground that in March 1994 following that accident, the powerline was replaced in the same location without marker balls and that this was the powerline struck by Mr Harrold. It was common ground that the powerline remained unmarked.

113 It was also uncontroversial that the "Australian Standard for Air Navigation - Cables and Their Supporting Structures - Mapping and Marking" being AS 3891.1 of 1991 provided:

"5.1 Any section of cable, which has -

...

(b) A cable height in excess of 90m continuously for 50m above any ground not containing a road, railway or navigable waterway shall be marked with markers of alternating colours, one of which shall be white, while the other colour shall be chosen to achieve maximum contrast with the background. Intervals between markers shall be as follows ..."

The relevant interval here would be between 35 and 40 metres.

114 An affidavit of Mr Walton provided evidence that powerline marker balls in attention catching sizes and colours had been readily available since the 1980's and could be simply fitted to powerlines in one form or another. The affidavit included evidence that these devices had been sold to Energy Australia in the period 2001 - 2008, including in Hunter Valley regions such as Muswellbrook, Wallsend and Telarah.

115 His Honour found that in the circumstances Energy Australia owed a duty of care to helicopter pilots such as Mr Harrold and that breach of duty in accordance with the provisions of s5B CLA had occurred. He found that had Energy Australia been sued it would have been found liable for some part of the damage caused to the helicopter.

116 The appellant submitted that this finding by his Honour was wrong. It based its submissions upon the decision of Sheather v Country Energy [2007] NSWCA 179; (2007) Aust Torts Reports 81-901. That was a case where an energy company had erected a powerline in a gap between some hills. There was a road which ran through that gap which was used by pilots as a navigational aid. It was common practice for pilots to fly helicopters and other aircraft through that gap. Flying through the gap was particularly attractive because the ridge often accumulated low cloud and the gap was the lowest point at which a pilot might be able to fly through without entering cloud.

117 The appellant distinguished the facts of that case from the facts here. It submitted that in Sheather a duty of care was owed because of the circumstances of the location of the wire which was strung across a gap through which it was reasonably foreseeable aircraft would pass and where its pylons were hidden in bush on either side of the gap.

118 The appellant submitted that the situation here was very different. The powerline was located in restricted airspace. Rather than there being any enticement for pilots to fly close to the powerline, they were not supposed to fly through it at all. It submitted that even though military helicopters might have used that airspace, that class of pilot did not include Mr Harrold and in any event, it would be a simple matter to advise military pilots of the existence of the powerline. The appellant submitted that in this case Energy Australia owed no duty to all civil aviators who might fly in this area, particularly where they were forbidden to do so.

119 The issues in determining this question are whether it was reasonably foreseeable by Energy Australia that helicopters might come in contact with the powerline and if it were reasonably foreseeable, was Mr Harrold a member of a class of pilot who should have been in the contemplation of Energy Australia as reasonably likely to come in contact with the powerline.

120 What is clear from Mr Tyler's evidence concerning the Shoalwater Bay Military Training Area, is that it should have been reasonably foreseeable by Energy Australia that military aircraft, and in particular helicopters, would be flying within the SATA. It should also have been reasonably foreseeable that such military aircraft, in particular helicopters, because of the very nature of their function would have been engaged in low flying activities. There was no evidence at trial that Energy Australia had notified the Australian Defence Force (ADF) of the presence of the powerline and the fact that it was unmarked.

121 Even if Energy Australia had notified the ADF to that effect, it would not have been an adequate response to the foreseeable risk of injury for a number of reasons. The consequences of contact with an unmarked powerline could be severe and in many cases, would result in death. The cost of alleviating this danger was modest. Notifying the ADF in the way suggested assumed that such information would have been communicated to each pilot operating in the area and it makes no allowance for momentary inadvertence on the part of a pilot whose attention was otherwise focused.

122 Looking at the matter purely from a duty of care point of view, I do not see any compelling reason for why the class to whom the duty was owed should be restricted to military pilots. As the incident of 1994 made clear, there were good reasons why non-military helicopters could be operating in this area. The factual circumstances of this case provide another, i.e. weather conditions could be such as to compel a civilian helicopter to fly in this area.

123 From the point of view of breach of duty, I see no reason why the "risk of harm" in s5B should be a risk restricted to military pilots, rather than a more general risk, i.e. a risk that a helicopter (no matter of what kind) might come in contact with the powerline.

124 Taking those matters into account, I am satisfied that not only did Energy Australia owe a duty to pilots such as Mr Harrold but that the duty was breached in this case.

125 Without going into details as to moral culpability and causal potency, and having regard generally to the principles in Podrebersek v Australian Iron & Steel Pty Ltd [1985] HCA 34; 59 ALJR 492 at 494, I would apportion liability as to 60 percent against Energy Australia.

Quantum

126 His Honour dealt with this at [257] - [271] (Red 94F - 97F).

127 The only issue between the parties is the assessment by the trial judge of the claim for diminution in value of the repaired helicopter and the claim for loss of profits. The difference between the parties in relation to the claim for loss of profits is small. The real matter in dispute is the claim for diminution in value of the repaired helicopter. The trial judge assessed the diminution in value at $50,000. The claim made by the appellant is somewhere between $400,000 and $600,000.

128 The assessment made by his Honour is essentially unreliable because he confused the helicopter under consideration with another helicopter. His Honour erroneously thought that the subject helicopter was older, had flown for considerably longer and had suffered serious damage in addition to the damage caused by this accident. For that reason, the assessment by his Honour cannot be supported so that this Court has to decide for itself the amount of damages recoverable under this heading, had the appellant succeeded in the appeal.

129 The trial judge had available to him two reports by experts of comparable experience. Mr Blackburn prepared a report on behalf of the appellant and Mr McLean on behalf of the respondent. Both experts listed facts about the helicopter which can be usefully set out. The matters referred to by Mr Blackburn were: the helicopter had had three previous owners, had flown for 120 hours, was manufactured in 2008, that this was its only accident but that the accident had caused substantial structural damage which cost approximately $AU550,000 to repair.

130 Salient matters identified by Mr McLean were: the helicopter had been comprehensively repaired with new replacement parts and had been certified as fit for use following the repair and had been in continual use ever since. He noted that the helicopter had landed safely (no crash landing) with damage only to the blades, canopy and doors. Most particularly, the helicopter had sustained no mechanical or engine damage in the accident. He assessed the accident damage as "moderate". The helicopter was purchased approximately one month prior to the accident for $US 1.35 million.

131 It should be noted that the helicopter was placed in use on a commercial basis when the repairs were completed and has operated satisfactorily since. The helicopter was not for sale at the time of trial.

132 A significant difference between the experts is that Mr McLean had particular regard to the number of helicopters for sale in Australia and New Zealand, but also took into account those for sale in North America and overseas. His inquiries revealed approximately 30 such helicopters for sale (in September 2011). Mr Blackburn focused mainly on the United States and as of April 2011, he found there to be approximately 60 such helicopters for sale.

133 I did not find the example provided by Mr Blackburn (at Blue 196 O - T) to be particularly helpful. He explained how difficult it was to sell a helicopter of this model which had been left neglected in a hangar for a year and referred specifically to the concerns which potential purchasers had about "neglect" and "unknown internal damage". The helicopter in this case did not suffer any mechanical damage and so is not realistically comparable.

134 The real problem with resale is that identified by Mr McLean, i.e. a psychological one. Once a proposed purchaser knew that an aircraft had suffered damage, that would inevitably affect the assessment placed on its value. This is despite the fact that the aircraft was expertly repaired to the manufacturer's specifications.

135 The assessments made by both experts are somewhat arbitrary and they do not set out their reasoning process in any detail. Given the subjective nature of the exercise, to some extent that is understandable. I did, however, find the assessment by Mr Blackburn of $US 595,000 as the diminished value of the aircraft to be almost totally unexplained. The approach of Mr McLean seems to me to be more balanced. This is particularly so when as at the date of trial, the helicopter had been successfully operating for a considerable period of time. There is some force in the submission on behalf of the respondent to the effect that the longer the helicopter successfully operates, the less concern a potential purchaser is going to have concerning the diminution of value.

136 Doing the best I can, I would assess the diminution in value at 10 percent of the purchase price, i.e. $US 135,000. While that is somewhat greater than the 7 percent assessment made by Mr McLean, it does have regard to what he identified as the psychological effect of the helicopter having been damaged. In my opinion, it is a much more realistic assessment than that of Mr Blackburn. This is particularly so when the data used by Mr Blackburn covered aircraft which varied in date of manufacture from 1998 to 2009.

137 In relation to the reduction in profits, I agree with the appellant that the figure of $20,000 assessed by his Honour appears to be an estimate made without any reference to the factual material provided to him. The figure claimed by the appellant of $67,968 as explained by senior counsel in the appeal, relied upon an interpretation of the actual earnings of the repaired helicopter which is unduly favourable to the appellant, given that the accident occurred on the first day of the helicopter's operation. In my opinion, a greater allowance needs to be made for the inevitable slow start which would have occurred whether the operation of the helicopter occurred when planned or as eventuated, nine months later. I would allow $55,000 for the loss of profits.

138 These findings as to apportionment and damages are, however, academic. For the reasons set out above, the attack on his Honour's factual findings, except in some peripheral areas, has not been made out. It follows, therefore, that the appeal should be dismissed. The appellant should pay the costs of the appeal.

139 WARD JA: I have had the opportunity of reading in draft the comprehensive reasons of Hoeben JA and agree that, for those reasons, the appeal must be dismissed with costs.

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Decision last updated: 12 March 2014