Marsh V Baxter - A Legal Perspective

[Insert image
here to
match your
presentation –
contact Meg in
BD to obtain
images]
Marsh v. Baxter –
a legal perspective
25 November 2014
Andrew Chalet
Principal, Russell Kennedy Lawyers

Marsh v. Baxter – a legal
perspective
A look at the case of Marsh v. Baxter (2014) in the
Supreme Court of Western Australia before Kenneth
Martin J, and in particular a look at:-
> The legally relevant facts;
> The legal claims made;
> The Law;
> Observations;
> The Judgment;
> The current status; and
> The implications
2

perspective
Relevant Facts
> The Baxter farm, Sevenoaks and the Marshes farm,
Eagle Rest, are neighbouring farms 256 Kilometres
south-east of Perth
> They are, relevantly, separated by a road reserve of
20.9 metres
> Since 2002, the Marshes have taken steps towards
becoming a fully organic farming operation. In
practice, to sell Eagle Rest produce as ‘organic’,
they sought and received certification from the
3

perspective
National Association of Sustainable Agriculture
Australia (NASAA). Certification is by way of a contract
between the Marshes and NASAA, and can be viewed
(amongst other things) as a trade mark (certification)
licence
> Certification was current in 2010
> Baxter, in 2010, planted genetically modified (GM)
canola
> In October 2010, Mr Baxter decided, on the advice
of a local agronomist, to use a particular orthodox
harvesting methodology that involved cutting the
4

perspective
> canola plants and pushing them into standing
windrows in the paddocks.
> Between 8 and 10 November 2010, the canola was
cut and left to ripen in the paddock for 2-3 weeks
> The more dried-out canola plants were then
processed by a ‘header’ to harvest up the ripened
canola seeds from each cut plant
> By 29 November 2010, Mr Marsh noticed cut canola
plants outside Sevenoaks, then in the road reserve,
and then on his Eagle Rest Property
5

perspective
> By 1 December 2010, Mr Marsh had notified
DAFWA of the presence of GM Canola on Eagle
Rest, and the next day informed NASAA
> It was not disputed that the canola came from
Sevenoaks
> As a result of the presence of the GM canola,
NASAA suspended the certification of Eagle Rest
until it could be verified that the GM material had
been entirely removed
6

perspective
> The Claims made
The Marshes claimed from Mr Baxter:-
> damages in the sum of $85,000 representing losses
arising from the absence of NASAA certification
across 3 successive financial years up to June
2013;
> a permanent injunction against Mr Baxter’s future
‘swathing’ of GM canola on his land, that is the use
of the particular harvesting methodology that leaves
cut canola in the open to ripen for 2-3 weeks.
7

perspective
The basis of the claim was 2 tortious causes of action,
namely:-
> Common law negligence
> Private nuisance
The Marshes made no claim regarding the planting,
growing or harvesting (using other methods) of GM
Canola
The parties and their respective experts accepted that
an escape of GM canola from Sevenoaks posed no
physical danger to persons, animals or property at
Eagle Rest.
8

perspective
There was no transfer or dissemination of GM traits
from the GM canola for a number of reasons, including
that no canola was planted at Eagle Rest.
The damages claim and the claim for a permanent
injunction was based on compensation for, and
protection from future economic loss as a result of
decertification.
The claims made by the Marshes did not therefore
concern crop contamination, in the sense of transgene
movement, or against the planting, growing
9

perspective
or harvesting (other than a particular method of
harvest) of GM canola.
The claims made only related to the economic
consequence to the Marshes of a loss of NASAA
certification.
10

perspective
The Law
Common law Negligence
To bring a negligence claim, the plaintiff must prove:-
> The defendant owed the plaintiff a duty of care;
> The defendant breached this duty; and
> The breach caused damage to the plaintiff.
The level of care owed is generally the care a
‘reasonable person’ in that situation would take.
11

perspective
Except in special circumstances (the settled special
circumstances not being present in this case), pure
(only) economic loss is not recoverable. However, the
plaintiffs ‘vulnerability’ to economic loss can be an
important factor in determining loss (Perre v. Apand
(1999))
12

perspective
Nuisance
> A nuisance is committed when a person
substantially and unreasonably interferes with
another person’s rights to the use and enjoyment of
the land.
> Generally, a permanent injunction is available, and
there is no restriction on claiming damages for pure
economic loss.
13

perspective
Observations
> Both the Marshes and Mr Baxter acted lawfully
> That is, there is nothing unlawful with the Marshes
choosing to be organic farmers at Eagle Rest;
> Likewise, since 2010 there is nothing unlawful about
Mr Baxter planting, growing, harvesting and selling
GM canola;
> Mr Baxter’s harvesting methods were considered
orthodox and undertaken on advice received from a
local agronomist.
14

perspective
> No physical damage or injury occurred. While GM
Canola was present on Eagle Rest, it had not
‘contaminated’ any crop grown on Eagle Rest.
> The loss suffered by the Marshes resulted entirely
from the decertification of their farm by NASAA
pursuant to a contract they had chosen to enter into
with NASAA.
15

perspective
Judgment
The Marsh’s action was wholly dismissed and
(pending the appeal) an award of cost is expected on
an unlimited but taxed basis.
The Court set out nine underlying, cornerstone
conclusions which led to the dismissal of the case, as
follows:-
First
Courts resolve litigation on the evidence before it.
16

perspective
Second
No evidence was produced or argument put forward
that the GM canola was in any way toxic, harmful or
otherwise dangerous to humans, animals or to land.
Third
The only injury or loss suffered was economic loss
resulting from the decertification by NASAA, and the
consequent inability to sell farm produce as ‘NASAA
certified organic’, although it could still be sold.
17

perspective
Fourth
None of the Marshes’ crops or sheep at Eagle Rest
could immediately acquire any genetic traits of GM
Canola because there can only be a genetic transfer
via pollen to a compatible species, and there weren’t
any.
Fifth
As regards longer-term seed mediated transfer of GM
canola, only 8 volunteer GM canola plants were ever
detected on Eagle Rest in a subsequent growing
season and, as readily identifiable, were pulled out.
18

perspective
Sixth
Mr Baxter could have used a different harvesting
method, known as ‘direct heading’, that would have
significantly reduced the risk of cut GM canola blowing
in the wind onto Eagle Rest.
Seventh
From a causation perspective, arguing against
growing GM canola would not be sustainable. The
grievance, if any, would be against the harvest
methodology.
19

perspective
Eighth
Growing GM canola became lawful in WA in 2010.
Therefore there was some uncertainty regarding GM
canola cropping exposure.
Ninth
An earlier transportation of canola seeds by rabbit
droppings was not relevant, as the grievance in this
case was against the harvesting method.
20

perspective
Therefore:-
1. Negligence
In a wholly novel case, there is no established duty of
care to avoid a foreseeable economic loss. There is no
particular vulnerability of the Marshes, as the NASAA
contract was ‘wholly self-inflicted’
Further, even if there was a duty of care to take
reasonable measures to inhibit the movement by wind
of the GM canola, as this was an unexpected first time
event, the duty was not breached.
21

perspective
Finally, the ‘cause’ of the loss was not the harvest
methodology, but the ‘unreasonable’ and’ ‘erroneous’
work of NASAA in applying one of the NASAA
standards to decertify Eagle Rest.
22

perspective
2. Nuisance
> No unreasonable interference caused by growing
GM canola.
> No physical damage, only economic loss arising
from a contract.
> Orthodox and recommended harvest methodology.
> Unexpected strong winds.
> First time growing GM canola.
> No recommended linear buffer distance.
23

perspective
The Implications
Negligence
Left open possibility of different outcome if:-
> Unorthodox harvesting method
> Correct and reasonable application of certifying
standards
> Some actual physical loss
24

perspective
Nuisance
Left open possibility of different outcome if:-
> Physical damage
> Unorthodox harvesting methodology
> Advice from agronomist or seed provider not
adhered to
> Not first time
25

perspective
Appeal
> As of 20 November 2014, an appeal had been
lodged, grounds not made public and we are
awaiting outcome.
26

perspective
Other cases
> French v. Auckland City Corporation
> actual damage must be caused
> actions must amount to excessive use of the land and
unreasonable interference
> where a defendant can take reasonable steps to
avoid a nuisance and fails to do so, can be nuisance.
27

Disclaimer
The information contained in this
presentation is intended as general
commentary and should not be regarded as
legal advice. Should you require specific
advice on the topics or areas discussed
please contact the presenter directly.
29

30
Andrew Chalet
Principal
Telephone: 03 8602 7243
Email: achalet@rk.com.au
Dr Peytee Grusche
Senior Associate
Telephone: 03 8602 7242
Email: pgrusche@rk.com.au

Marsh V Baxter - A Legal Perspective

Recommended

Recommended

More Related Content

More from Russell_Kennedy

More from Russell_Kennedy (20)

Recently uploaded

Recently uploaded (20)

Marsh V Baxter - A Legal Perspective