“The Butterfly Effect”

Introduction:

No. The conference organisers, when striking a title for this paper,  did not have in mind the 2004 psychological thriller film starring Ashton Kutcher.2  Or so I would like to think.

Rather the title is a reference to the purported  scientific discipline of chaos theory.   Sensitivity of initial conditions to minute variations is the essence of such theory.3

Although the origins of chaos theory lie with Henrie Poincaré in the 1880s, the modern progenitor of the theory was Edward Lorenz.  His interest ensued by happenstance by dint of his 1961 work on weather prediction.  Lorenz posited that minor changes in initial conditions may produce large changes in a longer term outcome.4

In a paper given by Lorenz in 1963 he observed: 5

One meteorologist remarked that if a theory were correct, one flap of a seagull’s wing would be enough to alter the course of the weather forever.

By the time of a 1972 meeting of the American Association for the Advancement of Sciences, the seagull had evolved into a butterfly.  The title of the talk there by Lorenz  was:6

Predictability:  does the flap of a butterfly’s wings in Brazil set off a tornado in Texas!

By now you might be thinking:  “Thanks for the science lesson Mr Douglas!  How is this going to assist me advise on or argue in respect of a cause of action at common law which raises a real question of causal nexus between breach of obligation and damage?”

My answer is this:

• the adjudication of causal nexus is fact sensitive, turning on the peculiar facts of each case and informed only sparingly by the similar facts of any decided case.

• an event of apparently little moment, on mature reflection, may found or preclude  such a nexus.

• in understanding this process, philosophy and logic can be  useful, but in truth commonsense judgment and legal experience are more potent tools in accurately predicting or striking an answer to the causation question.

My thesis in this paper is to make good these propositions by reference to the general law relating to duty (in contract and tort) to exercise reasonable care.

I do not address causation in statutory causes of action.  They are beyond the scope of this paper.7

The legal task:

The task for a plaintiff lawyer in any piece of litigation when treating the issue of causation is to construct, by evidence and argument,  a possible causal connection, and in turn elevate such connection to a probable cause.8

Conversely, the task for a defendant lawyer is to obviate or minimise such a construction or elevation.

In order to discharge such task in a given case careful attention ought be given to what evidence (by tender of evidence, and examination, and or cross-examination) ought be adduced.

The adducing of expert scientific evidence may assist the process, but in doing so lawyers ought not be slavish to scientific or philosophical disciplines.

As Mason CJ observed in March v E & M H Stramere Pty Ltd9:

In philosophy and science, the concept of causation is being developed in the context of explaining phenomena by reference to the relationship between conditions and occurrences.   In law, on the other hand, problems of causation arise in the context of ascertaining or apportioning legal responsibility for a given occurrence.

There are events which follow breach of duty which, considered ephemerally, seem  surprising outcomes to be causally connected therewith.  In respect of these instances the metaphors of a butterfly wing flap causing a tornado or ripple causing a tsunami may be generally apt, albeit somewhat far-fetched.

Expressed in legal terms the question is whether  the risk of damage or loss the subject of a contractual or tortious duty has subsequently materialised in some fashion such that a real, not speculative connection between duty breach and damage can be sensibly  forged.

The vogue negative method of expressing the requisite proof is this:  a defendant who in breach of obligation exposes a plaintiff to a risk of damage or loss will not be liable “unless the plaintiff can persuade the trier of fact that the risk came home”.10

The controlling features introduced by the (unwritten) common law, augmented by (written) statute law, consist in the law pertaining to causation and remoteness of damage respectively.

Remoteness of damage is beyond the scope of this paper.

Insofar as causation is concerned the issues which would arise for consideration are these:

• Legal not scientific proof.
• The post hoc ergo propter hoc fallacy.
• Probability not possibility.
• The shifting of onus fallacy.
• Intervening causes.

In order to address those matters I first need to identify the common law and statutory tests for causation.

Common law test:

The common law was well stated recently by Kiefel J in Tabet v Gett:11

[111] The common law requires proof, by the person seeking compensation, that the negligent act or omission caused the loss or injury constituting the damage. All that is necessary is that, according to the course of common experience, the more probable inference appearing from the evidence is that a defendant’s negligence caused the injury or harm. “More probable” means no more than that, upon a balance of probabilities, such an inference might reasonably be considered to have some greater degree of likelihood; it does not require certainty.

[112] The “but for” test is regarded as having an important role in the resolution of the issue of causation, although more as a negative criterion than as a comprehensive test.  The resolution of the question of causation has been said  to involve the common sense idea of one matter being the cause of another. But it is also necessary to understand the purpose for making an inquiry about causation  and that may require value judgments and policy choices. 

[113] Once causation is proved to the general standard, the common law treats what is shown to have occurred as certain.  The purpose of proof at law, unlike science or philosophy, is to apportion legal responsibility.   That requires the courts, by a judgment, to “reduce to legal certainty questions to which no other conclusive answer can be given.”   The result of this approach is that when loss or damage is proved to have been caused by a defendant’s act or omission, a plaintiff recovers the entire loss (the “all or nothing” rule).

[Footnotes deleted, emphasis added]

Event A need only be a cause, not necessarily the cause of event B, albeit such candidate cause need be material:  Bonnington Castings Ltd v Wardlaw.12  In Medlin v State Government Insurance Commission13, the High Court wrote:

Statutory test:

Given my audience I will address only the relevant Queensland statutes although they are replicated interstate albeit outside the sphere of employment liability.

The statutory regime on causation apropos breach of duty requiring exercise of reasonable care is encapsulated in ss 11 and 12 of the Civil Liability Act 2003 (Qld).   These are  replicated, for work injuries on and from 1 July 2010, by ss 305D and 305E of the Workers’ Compensation and Rehabilitation Act 2003 (Qld). 

Sections 11 and 12 of the Civil Liability Act provide:

In Adeels Palace v Moubarak14,  the High Court wrote about s 5D of the NSW Act, being the NSW analogue of s 11 of the Civil Liability Act, in the context of a plaintiff seriously assaulted by a fellow restaurant patron due to alleged poor restaurant security:

In Zanner v Zanner15, where the plaintiff mother stood in front of a vehicle being manoeuvred by her defendant son, it was observed in the New South Wales Court of Appeal apropos the NSW analogue of s 11 of the Civil Liability Act:

Legal not scientific proof:

In adjudicating the question of causation, a court will often have before it competing expert evidence expressing scientific opinion and  reasoning addressing causation of an event or outcome.

Legal proof and scientific proof are disparate concepts, albeit they may occasionally conjunct.  Proof sufficient for legal responsibility is on the balance of probabilities.  Proof of mere loss of a chance does not suffice:   Tabet v Gett.16

In Dobler v Halverson17 it was written:

See also State of New South Wales v Allen.18

The post hoc fallacy:

Post hoc ergo propter hoc (the translation from latin “after this, therefore because of this”) is a logical fallacy:

Since that event followed this one, that event must have been caused by this one.

The fallacy lies in arriving at a conclusion on causation based solely upon the order of events, and thereby failing to take into account other matters that might obviate that connection.

While the fallacy is not germane in a conventional physical injury case such as a motor vehicle accident causing immediate frank injury, it resonates in all other scenarios.  Particular damage may have only tenuous roots in the proven breach such that it might have occurred in any event.

Even in a conventional claim, the alleged consequential but discrete economic losses may have occurred in any event as due to independent causes.  More often this exemplified circumstance is addressed by finding of causation of economic loss but with consequent discounting for chance upon assessment of damages.19

The post hoc fallacy is well identified in the case law.  In Minh Lai Nguyen v Cosmopolitan Homes (NSW) Pty Ltd20:

The issue there was whether electrical cables being laid on brick tiles was a cause of the fire that destroyed the plaintiff’s home.

A recent example of the application of principle in this regard is Roads and Traffic Authority v Royal.21  There the issue arose in the context of a plaintiff who sued another driver and a road traffic authority on account of negligence resulting in a collision injury.  It was plain the road authority breached its duty in respect of road design.  Many accidents had previously occurred at the same location probably spawned by the defect in design.  But a finding of causation, on the evidence, was eschewed by the High Court:

One of the modern seminal cases on this issue is Alexander v Cambridge Credit.22  A long ignored but more recently referenced  analogy identified therein was rehearsed in the dissenting judge in that case, Mahoney JA:23

A recent example of a case in which that dictum  was applied is Hay Property Consultants Pty Ltd v Victorian Securities Corporation Ltd.24  There the plaintiff lender sued the defendant land valuer on account of a negligent valuation of certain properties.  Evidence was accepted to the effect that if the correct (lower) valuation had been given then the loan would not have been made by the lender.  Thus the properties would not have been taken as security. 

After the borrowers defaulted on loan repayments the lender  had obtained possession of the secured properties, but before it did so the properties were deliberately damaged by an unknown third party. This damage devalued the land to the extent of the lender’s loss on subsequent sale.

Finding against the plaintiff lender on causation on a number of bases,  the court observed:

[87] … although the lender would not have made the loan but for the valuers’ misrepresentations, the satisfaction of the “but for test” is not sufficient to establish that the loss was caused “by” the negligent conduct of the valuers. …

Probability not possibility:

Again, a plaintiff must prove, on the balance of probabilities, that the harm sustained was “caused or materially contributed to” by the defendant’s wrongful conduct:  Bonnington Castings Ltd v Wardlaw.25

In Miller v Council of the Shire of Livingstone26, McPherson JA expressed the legal position in a case in which breach of duty was proved but the causation of injury was not for sufficient proof by way of eye-witness or other evidence from which an adverse inference could be drawn: 

[4] It is not, however, enough to think up other competing hypotheses that are more or less favourable to the success of the plaintiff’s claim. No one can say that one of them is more probable than another because no one can say what in fact happened. The case is covered by what Lord Watson said in Wakelin v London & Southwestern Rye Co (1886) 12 App Cas 41, 47:

Mere allegation or proof that the company were guilty of negligence is altogether irrelevant; they might be guilty of many negligent acts or omissions, which might possibly have occasioned injury to somebody, but had no connection whatever with the injury for which redress is sought; and therefore the plaintiff must allege and prove, not merely that they were negligent, but that their negligence caused or materially contributed to the injury.

See also Fraser v Victorian Railway Commissioners (1990) 8 CLR 54, 59, 66. These decisions are old, but the principle has not changed. In the absence of evidence, speculation is not enough. It was necessary for the plaintiff to prove how or why he fell. Inference from proved facts will do, but not mere hypothesis. The circumstantial evidence in the present case does not support an inference that the plaintiff’s injuries resulted from the negligence of the defendants or either of them in installing or maintaining a fence that was too low rather than from some other cause that is inconsistent with negligence on their part.

[Emphasis added]

There the inference potentially open was  not just of the inebriated plaintiff in hours of darkness falling over the negligently low fence (in which event he would have proved causation) but equally that he sat on the fence or moved behind it to urinate (in which event causation would not be proved).  Each hypothesis was speculative.

Contrast, on similar  facts, the outcome in Jackson v Lithgow Shire Council27.   The contrasting result does not bespeak error in the reasoning of one or other case but rather that, like the adjudication of breach of duty, each case is distinctly fact sensitive.

What in this context is meant by “balance of probabilities”?  While a seemingly trite proposition, guidance is afforded in the remarks of Mahoney JA in Jones v Sutherland Shire Council28.

The first step, in a sense, involves simply an assessment of what is human experience: it is, or is not, a fact that human experience is so. But such an assessment is not made as a mathematical calculation. It involves other kinds of reasoning in judgments, the correctness of which cannot be demonstrated by mathematics or ordinary logic. Therefore, the subjective confidence which a person or a court will have in the correctness of the assessment may vary.

It is to this that, in my opinion, phrases such as ‘the balance of probabilities’ refer in respect of such an assessment.

In Amaca Pty Ltd v Ellis29, an asbestos case where there was a competing candidate cause of  heavy smoking, the case for the plaintiff was founded upon epidemiological evidence.  The High Court was at pains to point out that the Bonnington Castings “jurisprudence” was distinguishable on the facts because the basic question for adjudication was whether asbestos was a cause at all:

[68] This description of the issue of causation in Bonnington Castings shows how different it is from the issue of causation in this case. The issue in Bonnington Castings was whether one source of an injurious substance contributed to a gradual accumulation of dust that resulted in disease. The issue here is whether one substance that can cause injury did cause injury. Or, to adopt and adapt what Starke J said in Adelaide Stevedoring Co Ltd v Forst, was Mr Cotton’s cancer “intimately connected with and contributed to” by his exposure to asbestos? Questions of material contribution arise only if a connection between Mr Cotton’s inhaling asbestos and his developing cancer was established. Knowing that inhaling asbestos can cause cancer does not entail that in this case it probably did. For the reasons given earlier, that inference was not to be drawn in this case. Questions of what is a material contribution do not arise.

…

[70] The answer to the question can be expressed in several different ways. All depend upon the basic and unpalatable fact that no scientific or medical examination can now say, with certainty, what caused Mr Cotton’s cancer or lung cancer in any other particular case. As explained at the outset of these reasons, despite this uncertainty, the courts must, and do, “reduce to legal certainty [a question] to which no other conclusive answer can be given”. The courts do that by asking whether it is more probable than not that X was a cause of Y. Saying only that exposure to asbestos may have been a cause of Mr Cotton’s cancer is not a sufficient basis for attributing legal responsibility. Observing that a small percentage of cases of cancer were probably caused by exposure to asbestos does not identify whether an individual is one of that group. And given the small size of the percentage, the observation does not, without more, support the drawing of an inference in a particular case. The paradox, if there be one, arises from the limits of knowledge about what causes cancer.

[Emphasis added]

In Jovanovski v Billbergia Pty Ltd30 the plaintiff was injured when he slipped from a ladder on the back of a truck. He slipped because, unbeknown to him, grease had been smeared on the ladder steps. It was inferred that someone employed by the defendant, or another contractor had placed the grease there as a prank. There had been similar incidents of placement of grease on the plaintiff’s truck in the weeks leading up to the accident.

Breach of duty was found in relation to the absence of exercise of reasonable care by the defendant to minimise the prospect of grease being smeared on the truck, but causation was not proved. The case was decided under the Civil Liability Act 2002 (NSW) and reference was made to the analysis in the High Court decision of Adeels Palace, to which I made reference earlier.

Davies J went on to find that the circumstances of perpetration by the unknown third party precluded an inference of causation:

[79]  As in Adeels, there was no evidence in the present case to show that a warning coupled with a threat to the workforce would have prevented the grease smearing and the injury to Mr Jovanovski. All that is available is an inference that it might have deterred the perpetrator but it is equally able to be inferred that it would have caused the perpetrator to act with greater care not to be detected if, as seems likely, Mr Jovanovski was the clearly intended victim — there was no evidence of grease on other trucks.

…

[82]  More significantly, Adeels makes clear that where the issue of causation is governed by s 5D breaches such as those that I have found, cannot be regarded as a necessary condition of the occurrence of the harm for the purposes of s 5D(1). The matter can be put no higher than that the appropriate warning might have deterred or prevented the occurrence which caused the injury to the Plaintiff.

Continued …

Footnotes

1. Virgil “Georgics”, Book   No. 2, 1  490;  referred to in J Wilson “Inverting the pyramid” (Routledge, London, 2008, page 1)
2. Kutcher’s character routinely travels back in time so to alter positively the course of later events.   Ultimately he appreciates his endeavours end up harming him and those close to him.
3. Macquarie Dictionary (Fourth Edition, 2005) pg 249
4. J Gleick “Chaos:  Making a New Science” (Cardinal, London 1997) page 17.
5. E Lorenz “Deterministic Non-period Flow” (1963) Vol 20 Journal of Atmospheric Sciences at 131-141.
6. R Hilborn “Chaos in Non-Linear Dynamics” (Oxford University Press, 1994).
7. See, however, L Kelly SC “Causation and s 82 of the Trade Practices Act (Bar Association of Queensland/UQ Seminar Series, 2010)
8. As to which see Dahl v Grice [1981] VR 513 at 522-524
9. (1991) 171 CLR 506 at 509
10. Bendix Mintex Pty Ltd v Barnes (1997) 42 NSWLR 307 at 318
11. (2010) 240 CLR 537
12. [1956] AC 613; 
13. (1995) 182 CLR 1
14. (2009) 260 ALR 628; 84 ALJR 19; [2009] HCA 48
15. [2010] NSWCA 343
16. (2010) 240 CLR 537
17. [2007] NSWCA 335
18. [2000] NSWCA 50 per Priestley JA
19. Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 368
20. [2008] NSWCA 146
21. [2008] HCA 19
22. (1987) 9  NSWLR 310
23. at 333-334
24. [2010] VSCA 247
25. [1956] AC 613 at 620;  March at 514
26. [2003] QCA 29
27. [2008] NSWCA 312
28. [1979] 2 NSWLR 206 at 227
29. (2010) 240 CLR 111
30. [2010] NSWSC 211