Splash Waterpark Pty Ltd v Tim Schnitzerling [2021] NSWDC 62 is a reminder that litigants must lead evidence in support of the claim damages suffered or otherwise risk their claim being dismissed; even if the Court finds that the defendant has breached its duty of care.

 

Background

On 12 February 2017, a yacht named ‘Magnolia’ was anchored in Coffs Harbour. The yacht was owned and skippered by the defendant. The plaintiff’s inflatable waterpark was located north-east of the yacht. On the day, strong southerly winds blew into the harbour and dragged Magnolia (including its anchor) into the waterpark.

The plaintiff alleged that the defendant was negligent, as he:

(a)   allowed the defendant’s vessel to drift close to Jetty Beach and the Plaintiff’s Property.

(b)   failed to observe the dangers of allowing the Defendant’s Vessel to drift towards the Plaintiff’s property.

(c)   failed to observe the weather forecast before leaving securing the Defendant’s vessel.

(d)   failed to take adequate action and additional measures to prevent damage to the Plaintiff’s Property in circumstances where the Defendant knew or ought reasonably to have known, upon visual inspection, or observing the weather forecast that strong winds were forecast.

(e)   failed to take reasonable care to ensure that the Defendant’s Vessel was properly secured to its moorings.

(f)   failed to use sufficient lines to secure the Defendant’s vessel in circumstances where the Defendant knew or ought reasonably to have known of the expected weather conditions.

(g)   failed to properly check the conditions of the lines and mooring before securing the Defendant’s Vessel.

(h)   failed to ensure that the Defendant’s vessel was properly secured in circumstances where the Defendant knew or ought reasonably to have known of the expected weather conditions.

(i)   failed to take reasonable care to ensure that the Defendant’s Vessel was properly anchored.

(j)   failed to anchor the Defendant’s vessel properly in circumstances where the Defendant knew or ought reasonably to have known of the expected weather conditions.

(k)   failed to keep a proper lookout.

(l)    failed to avoid colliding with the plaintiff’s Property.

 

Decision

After having considered the admissible evidence adduced by the parties, Justice Russell first found that the particulars (c), (g) and (k), as set out above, were not made out. Justice Russell then found that the defendant breached his duty of care to the plaintiff, because he failed to reset the anchor despite his knowledge that southerly winds were going to occur that afternoon.

Despite the breach of duty of care having been established, the plaintiff was unable to prove, on balance of probabilities that the defendant’s breach had caused it any loss and damage.

In particular, the plaintiff was unable to prove an amount it had claimed for repair costs and loss of profits.

Repair Costs

In support of its repair costs, the plaintiff only tendered an invoice. The plaintiff did not provide any evidence in relation to nexus between the invoice and the alleged repair costs.

Loss of Profits

The plaintiff sought damages for loss of profits between 13 February 2017 and 7 April 2017, which is the period when the waterpark was under repair. The plaintiff’s director alleged that, on average, the waterpark made $1,500 per day in profits. However, no expert evidence was served in support of this proposition.

To rebut the plaintiff’s claim, the defendant served a report from a forensic accountant. The key finding of this report were that that in order for the plaintiff to quantify its loss of profits, it needed to establish each of the following:

  1. the expected operating days over the closed period;
  2. the expected number of paid admissions for each operating day over the closed period;
  3. the expected income for each admission;
  4. provide a breakdown of business expenses, including the ongoing expenses even when the business is closed;
  5. provide comparative records for similar businesses in the area; and
  6. provide a history of previous income, attendance reports, weekly payroll, and breakdown of bad weather days.

 

Implications

Justice Russell’s decision is an important reminder that in order to establish a complete claim in negligence, a plaintiff needs to be able to prove that a defendant’s breach caused its alleged loss and damage. In order to do this, a plaintiff must lead appropriate evidence in support of the defendant’s breach of duty of care, and the associated losses and damages.