CA 10085/08 and

Counter Appeal

CA 6339/09

CA 7607/09

 

Tnuva Central Cooperative for the Marketing of Agricultural Produce in Israel

 

v.

 

1. Estate of the late Tufik Raabi

2.  Israeli Consumer Council

 

 

The Supreme Court sitting as the Court for Civil Appeals

[29 November 2010]

 

Before Justices E. Hayut, U. Vogelman,  Y. Amit

 

 

Israeli Legislation  Cited

Class Actions Law, 5766-2006, ss. 20, 22, 23

Restrictive Trade Practices Law,  5748-1988

Banking  (Service for Customer) Law, 5741-1981

Equal Rights for Disabled Persons Law, 5758 – 1998, ss. 19 (54)   - 19 (64)

Male and Female Workers Equal Pay Law 5756- 1996, s. 11

Standards Law 5713-1953, ss. 9(a), 17 (a) (1), 17 (b)

 

 

Israeli Supreme Court Decisions Cited

 

[1]        CA 1338/97  Tenuva Central Cooperative for the Marketing of Agricultural Produce in Israel Ltd v. Raabi,  IsrSC 57 (4) 673 [2003]

[2]        CA 1977/97 Barazani v. Bezeq Israel Telecommunications Company Ltd, IsrSC 55 (4)  584 (2001);

[3]        FHC 5712/01 Barazani v. Bezeq Israel Telecommunications Company Ltd, IsrSC 57 (6)  385 (2003);

[4]          CA 2781/93 Daaka v. Carmel Hospital, Haifa   IsrSC 53(4)  526 [1998-9] IsrLR 409

[5]          LCA 3126/00 State of Israel v. E.S.T. Project Management and Manpower Ltd, IsrSC 57 (3), 220 (2003)

[6]        FHC 5161/03  E.S.T   Project Management and Manpower Ltd v. State of Israel, IsrSC  60 (2) 196 (2005)

[7]        CA. 8430/99 Analyst I.M.S. Trust Funds Management (1986) v. Ard Industrial Investment and Development, 256  IsrSC 56 (2)

[8]        LCA 4556/94 Tetzet v. Zilbershatz, IsrSC 49(5) 774 (1996);  

 

[9]        CA 345/03 Reichart v. Raabi Moshe Shemesh Heirs  (not yet reported) 7.6.2007)

 

[10]      CA 3506/09 Zaig v. Waxelman, Waxelman Accountants (not yet reported)( 4.4.2011)

 

[11]      CA 3613 Ezov v Jerusalem Municipality  IsrSC 56 (2) 787 (2002).

 

[12]      LCA 8733/96 Langbert v. State of Israel – Israel Lands Administration, IsrSC 55 (1) 168  (1999).

 

[13]      CA 7028/00 A.B.A. Trust Funds Management Ltd v. Elsynth Ltd (not yet reported, 14.12.2006)

 

[14]      HCJ 2171/06 Cohen v. Knesset Speaker (not yet reported, 29.8.2011)).

 

[15]      CA 10262/05 Aviv Legal Services Ltd v. Hapoalim Bank, Head Management  (not yet reported, 11.12.2008)

 

[16]      CA 3901/96 Local Planning and Building Committee v. Horowitz, IsrSC 56 (4) 913, 328 (2002)

 

[17]      CA 4576/08 Ben-Zvi v. Prof. His  (not yet reported, 7.7.2011)

 

[18]      CA 8126/07 Estate of the Late Bruria Zvi  v. Bikkur Holim Hospital (not yet reported, 3.1.2010);

[19]      CA 9590/05 Rahman Nuni v. Bank Leumi LeIsrael Ltd , (not yet reported  10.7.2007)

 

[20]      CA 6153/97 Shtendal v. Prof. Yaakov Sadeh , IsrSC 56 (4) 746 (2002)

 

[21]      CA 9936/07 Ben David v. Dr. Entebbe (22.2. 2011)

 

[22]      CA 9817/02 Weinstein v. Dr. Bergman, (not yet published, 16.6. 2005)

 

[23]      LCA 9670/07 Anon v. Anon (not yet reported,6.7.2009)

 

[24]      CA 2967/95 Hanan Vakshet Ltd v. Tempo Beer Industries Ltd,  IsrSC 51 (2), 312 (1997)

 

 [25]     FHC 4693/05 Carmel Haifa Hospital v. Malul  (not yet reported, 29.8.2010)

 

[26]      355/80 Anisimov Ltd v. Tirat Bat-Sheva Hotel. IsrSC 35 (2) 800 (1981)

 

[27]      CA 4022/08 Agbaba v. Y.S. Company Ltd],(21 October 2010 paras 10 – 24; 

 

[28]      C.A. 754/05 Levi v. Share Zedek Hospital) (2007) IsLR 2007  131

 

[29]      CA Reznik v. Nir National Cooperative Association for Workers Settlement [not yet published]   (20.7 2010]

[30]      CA  1509/04 Danush v  Chrysler Corporation (not yet published, 22.11.2007)

[31]       CA 9134/05  Adv. Eliezer Levit v. Kav Of Zafon, Cooperative Association for Services Ltd  [not yet reported, 7.2.2008)

[32]      AAA 2395/07  Accadia Software Systems Ltd v. State of Israel – Director of Tax and Stamp Duty 27.12.2010)

[33]      CA 7094/09 Borozovsky  Conveyancing Ltd v. Ichurn Itur Veshlita Ltd (14.12.2010) 

           

 

American Cases

 

[34]Affiliated Ute Citizens of Utah v. United States 406 U.S. 128, 153-154 (1972) ;

 

[35 ]Binder v. Gillespie 184 F.3d 1059, 1063-1064 (9th Cir. 1999)

 

[36]; Poulos v. Caesars World Inc. 379 F.3d 654, 666 (9th Cir. 2004

 

[37] Kennedy v. Jackson National Life Insurance Company, 2010 U.S. Dist. Lexis 63604, 25-28 (N.D.Cal 2010)

 

[ 38]  Negrete v. Allianz Life Insurance Company of North America 238 F.R.D 482, 491-492 (C.D. Cal. 2006)[.

 

[39]Klay v. Humana, Inc.382 F.3d 1241, 1259 (11th Cir. 2004)

 

[40] Johnson v. The Goodyear Tire & Rubber Company, Synthetic Rubber Plant, 491 F.2d 1364, 1379-1380 (5th Cir. 1974);

 

[41]Cooper v. Allen, 467 F.2d 836, 840 (5th Cir. 1972)

 

[42]Allison v. Citgo Petroleum Corp., 151 F.3d 402, 417 (5th Cir. 1998);

 

[43 ]Reeb v. Ohio Department of Rehabilitation and Correction, 435 F.3d 639, 650-651 (6th Cir. 2006);

 

[44] Fuhrman v. California Satellite Systems, 179 Cal. App. 3d 408, 424-425 (1986);

[45] Altman v. Manhattan Savings Bank, 83 Cal. App. 3d 761, 767-769 (1978);

 

[46] Stilson v. Reader's Digest Association, Inc., 28 Cal. App. 3d 270, 273-274 (1972);

 

[47] Birnbaum v. United States, 436 F. Supp. 967, 986 (1977).

 

[48] Bates v. UPS 204 F.R.D. 440, 449 (N.D. Cal. 2001)

 

[49]  Olden v. LaFarge Corp. 383 F.3d 495, 509 (6th Cir. 2004)-

 

[50] Hilao v. Estate of Ferdinand Marcos, 103 F.3d 767, 782-787 (9th Cir. 1996)

 

[51 ] Wal-Mart Stores, Inc. v Dukes, 131 S. Ct. 2541, 180 L. Ed. 2d 374 (2011)

 

[52] Midwestern Machinery v. Northwest Airlines 211 F.R.D. 562, 572 (D. Mn. 2001)

 

[53 ] McLaughlin v. American Tobacco Co.

 

[54 ]: Pettway v. American Cast Iron Pipe Co., 494 F.2d 211 (5th Cir. 1974);

 

[55] Stewart v. General Motors, 542 F.2d 445 (7th Cir. 1976);

 

[56]  Bowe v. Colgate-Palmolive Co., 489 F.2d 896 (7th Cir. 1973); 

 

[57] United States v. Wood, Wire & Metal Lathers Int. Union, Local Union 46, 328 F.

 

[58]Hood v. Eli Lilly & Company 671 F. Supp 2d  397, 434-453 (E.D.N.Y. 2009)

 

[59] Long v. Trans World Airlines, Inc., 761 F. Supp. 1320 (N.D. Ill. 1991))

 

[60] Allison v. Citgo Petroleum, 151 F.3d 402, 414-415 (5th Cir. 1998);

[61] Lemon v. Int'l Union of Operating Engineers, Local No. 139, AFL-CIO 216 F.3d 577 (7th Cir. 2000);

[62] Jefferson v. Ingersoll Int'l, Inc. 195 F.3d 894 (7th Cir. 2001); 

[63] Reeb v. Ohio Department of Rehabilitation and Correction, 435 F.3d 639 (6th Cir. 2006).

[64]  Fibreboard Corp., 893 F.2d 706, 712 (5th Cir. 1990).

 

[65]  Windham v. American Brands, Inc., 565 F.2d 59 (4th Cir. 1977)

 

[66]  Redish; Powell v. Georgia-Pacific Corporation, 119 F.3d 703, 706 (8th Cir. 1997)

 

[67]  Airline Ticket Commission Antitrust Litig, 268 F.3d 619, 625 (8th Cir 2001)

 

[68] Folding Carton Antitrust Litig. 744 F.2d 1252 (7th Cir. 1984)

 

[69]  Houck v. Folding Carton Admin. Comm., 881 F.2d 494 (7th Cir. 1989)

 

[70]  Cuisinart Food Processor Antitrust Litig38 Fed. R. Serv. 2d (Callaghan) 446 (D. Conn.1983).

 

[71] Democratic Cent. Comm. v. Washington Metro. Area Transit Comm'n

 

[72]  Domestic Air. Transp. Antitrust Litig

 

 

 

For the petitioners — T. Feldman, Y. Elam, F. El-Ajou, H. Jabarin.

For the respondents — A. Helman, A. Segal-Elad, H. Gorni.

 

 

JUDGMENT

 

Justice E. Hayut

 The decision forming the subject of the appeals before us was given in a consumer class action that was approved for filing against Tnuva Central Cooperative for the Marketing of Agricultural Produce in Israel Ltd (hereinafter – “Tnuva”).  The suit concerns the misleading of the consumer public and the production of a dairy product in contravention of the official standard in force on the dates relevant to the suit, by reason of the addition of silicon to  long lasting low fat (1%) milk, that was manufactured and marketed by Tnuva, without making any mention of the silicon component on the product.

Factual Background and the Process of Approving the Suit as a Class Action

     1. At the end of 1993 a problem of over-frothing arose in the process of mixing long lasting milk containing 1% fat (hereinafter: “the milk”) as a result of a problem in one of the machines on the production line. Given the high cost of the malfunctioning machine (about 300 – 400 thousand  U.S dollars) the personnel of the Rehovot dairies decided to solve the problem of  frothing  by adding a chemical substance known as “Polydimethyilsiloxane” , the trademark for which is E-900, to the milk.  This substance is known as “silicon” and was purchased by the dairy in Rehovot, from Amgal Production of Chemicals (1989) Ltd (hereinafter: "Amgal")  without informing the central management of Tnuva.  The Amgal company purchased the silicon from an English company. The aforementioned addition of the silicon to the milk continued from 25 January 1994 until 6 September 1995, just after the affair was exposed. During that period the Tnuva dairy in Rehovot produced and marketed to the public an overall amount of 13 million liters of milk.

The addition of the silicon to the milk was first exposed in the media on 30 August, 1995 and Tnuva's initial reaction consisted of a sweeping denial  of the allegation against it.  This was the case both in an interview of the director of the  Tnuva Milk department, Mr. Yosef Yudovitz and in the official press releases on behalf of Tnuva published in a number of papers on 31 August, 1995, in which it stated that the Tnuva long life milk was free of the silicon supplement and that independent laboratory tests verified this (similar pronouncements also appeared on  1 September, 1995).  The Tnuva representatives continued to deny the addition of silicon in a hearing conducted in the Knesset Economic Committee on 5 September 1995, but soon after that, on 10 September 1995 an internal commission of inquiry appointed in the wake of the publication determined that indeed a silicon supplement had been added to the long life milk that contained 1% fat, in the Tnuva dairy of Rehovot, and the commission's conclusions were published in the media. In the wake of these conclusions, Tnuva recalled all of the cartons of 1% long life milk from the shelves of the stores, to which it was feared that the silicon had been added, and the manager of the Rehovot dairy was suspended from his position.   The National Food Service of the Ministry of Health likewise decided  that Tnuva would have to destroy all of the milk containing silicon and it was prohibited to use it, even as food for animals.  It was further decided on 12 September 1995 to revoke the permit that had been given to Tnuva confirming appropriate conditions of production. Tnuva on its part decided on the same day to establish a commission to investigate the affair, which would give recommendations on "lessons to be learnt and conclusions to be drawn in each and every area that it found appropriate, including personal conclusions"  The committee  headed by Prof. Yehuda Danon, and after it had heard the testimonies and examined the documents,  it published the "Committee's Report on the Examination of Long Life Milk" (hereinafter: the Danon Committee Report"). In the framework of the Report criticism was leveled against senior workers in the Tnuva dairy, against the senior management of Tnuva by reason of the absence of supervision and inspection in the Tnuva dairy, and even against the Food Service in the Ministry of Health, and the Institute for Inspection and Quality in the Trade and Industry Office that was supposed to have conducted supervision and inspection of the quality of the food.

2.    The state on its part on 30 January, 1996 filed an indictment against Tnuva in the Magistrates Court of Rehovot, and against  its CEO and against the manager of the Milk Department and the manager of the dairy for offences of misleading in an advertisement, pursuant to ss. 2(a), 7 (a)(1), 23 and 27 of the Consumer Protection Law 5741-1981 (hereinafter:
"Consumer Protection Law") and against Tnuva and the manager of its dairy in Rehovot for the offences of failing to comply with an official standard pursuant to ss.  9(a), 17 (a)(1) and 17 (b) of the Standards Law 5713-1953 (hereinafter:"Standards Law"). On 4 March 1997 the defendants were convicted by force of their confessions for the offences that were ascribed to them, and the Court accepted the plea bargain that was reached between them and the state, in accordance with which a financial penalty was imposed on Tnuva and the other defendants  (the financial penalty imposed on Tnuva was for the sum of NIS 28,000).

Another proceeding instituted against Tnuva was the present proceeding, which began in a suit filed in the Tel-Aviv Jaffa District Court  on 14 September, 1995 by the late Tufik Raabi (hereinafter:  "Raaabi") along with an application for the certification of the suit as a class action (CF 1372/95, Mot. 11141/95. In his (amended) suit, Raabi claimed that he had consumed long lasting low fat (1%) milk during the relevant period and that the silicon was not specified as one of the ingredients on the packaging of the product, and as such Tnuva had violated the provisions of sections 2,4, and 17 of the Consumer Protection Law.  Raabi further alleged a infringement of an “unwritten contract” with him and with the consumer public in its entirety and negligence on the part of Tnuva in all of the stages involved in “production, supervision, marketing and advertising of the facts related to the addition of the prohibited material to the milk and the fact of the reasonable probability of a real and/or potential health hazard in the product that it marketed”.  In his petition Raabi requested restitution of the sums he had paid in consideration for the milk that he had purchased in the relevant period and compensation for the mental anguish caused to him by the addition of the silicon and by reason of the “misleading and contemptuous” conduct of Tnuva. Raabi’s request for his suit to be recognized as a collective action relied on Chapter F’1 of the Consumer Protection Law, which at that time included an arrangement for the filing of a collective action based on the grounds specified therein. 

3.    The Tel-Aviv District Court (the late Honorable Judge M. Telgam), on 13 June 1996 certified Raabi’s request to file a class action in the name of all of the milk consumers during the relevant period, but the court stressed that in this case it would not certify the remedy of restitution because Raabi had already consumed the milk and had not claimed that any real damage had been caused by its consumption, and he further stressed that even though there was nothing to prevent Raabi from proving that his health had been damaged thereby,  he was not permitted to represent the members of the group regarding “future bodily damage”.

An appeal and a counter appeal against the certification decision were filed by the parties to the Supreme Court (CA 1338/97 Tnuva Central Cooperative for the Marketing of Agricultural Produce in Israel Ltd v. Raabi  [1]  (hereinafter: Decision on the Certification Request)). Tnuva challenged the certification of the suit as a class action and Raabi challenged the determination that the class action would not include the remedy of restitution, and the fact that there was no award for legal fees in his favor. The Israeli Consumer Council joined as a party to the hearing (Raabi and the Israeli Consumer Council will hereinafter be referred to as “the representative plaintiffs”), and in the Attorney General joined as a party in the appeal proceedings, in support of the confirmation of the class action

4.    On 19 May, 2003 in a majority decision, this Court rejected the aforementioned appeals filed by the parties and left the decision of the District Court intact in the sense of certifying the filing of a class action. Regarding this, Justice M. Naor held that the damages claim by Raabi concerns the  non-pecuniary damage that was caused to him by negative feelings, and feelings of disgust, which stem from the consumption of milk that contains silicon “with all of the associations attendant thereto” and that damage of this kind was prima facie “remunerable damage”. The justice further ruled that the addition of the silicon supplement to the milk in defiance of the standard constitutes an  infringement of individual autonomy, and that under the circumstance this not a “trivial matter) (de minimis), and that despite the fact that the Consumer Protection Law does not contain a provision that enables a compensatory award for the benefit of the public or the benefit of a group (all or in part) the court is permitted to award this kind of remedy in a suit under the Consumer Protection Law in appropriate cases in which there is a structural difficulty in locating the consumers. All the same, Justice Naor ruled that the Court would not intervene with the District Court’s decision not to award restitution in this case. Regarding the plaintiffs’ group Justice Naor ruled that it would include all those who had consumed  long life milk of 1% to which silicon was added  during the period between 23 October 1994 and September 1995”, having regard for the fact that the provision in the Consumer Protection Law that allowed the filing of a collective action came into effect on the 23 October 1994 and the fact that in the month of September 1995 the dairy products containing silicon were removed from the shelves.

Deputy President, S. Levin concurred with the ruling of Justice Naor (subject to the issue of awarding a remedy to the public being left as requiring further consideration), and Justice Proccaccia ruled in her minority opinion that the suit should not be recognized as a class action.  She held that the chances of Raabi’s personal suit succeeding are not “self evident” and in her view, "the claim concerning the injury as a result of the inclusion of the supplement in the food product, in deviation from the standard, but without having caused any damage to health, does not dictate, "self evidently" that damage flows naturally in the regular course of events".  Justice Proccaccia added that she would also have refrained from approving the suit as a class action in accordance with the discretion conferred to the court in this matter  (s. 35A of the Consumer Protection Law), inter alia given the fact that the nature of the alleged damage  is not necessarily common to the entire consumer public, and "it is connected to the individual health threshold of each consumer and significantly dependent upon it."

The Class Action Proceedings

5.    Once the suit was certified as a class action, the District Court (Judge Dr, E. Benyamini)  ordered the publication of a notification to the public and the filing of amended claim sheets in accordance with the prescribed conditions of the certification. In the amended statement of claim that they filed, the representative plaintiffs claimed that the approximate number of members in the plaintiff group was estimated at about 43% of the population, which constitutes over two million consumers, and that the members of the group should be compensated for infringement of their autonomy and negative feelings occasioned by inter alia deception, contempt, mental anguish, nausea, aversion to essential food products, fear and anxiety.  According to the representative plaintiffs, the members of the group in their entirety should receive compensation of NIS 8000 for each consumer included in the plaintiff group.  Tnuva on its part argued that the claim relating to the infringement of individual autonomy should be rejected, because no such infringement was actually  caused, and if caused, it was minor and peripheral, in the category of de minimis.  In this context Tnuva stressed,  inter alia  that the addition of silicon to the milk  did not harm the consumers and that silicon was a recognized, approved, and frequently used food supplement all over the world.

6.    The first stage of preliminary proceedings in the Lower Court was intended,  inter alia to crystallize the proceedings for the hearing and the means of proving the suit. In this framework the Lower Court  ruled that the evidentiary stage would not be divided into separate hearings for the question of responsibility and the question of damage.  The court further rejected Tnuva's request to establish a system for proving the non-pecuniary damage on an individual basis, ruling that already at the preliminary stage  "it was clear that the only way of proving damage in this case, if at all, in the absence of any method for locating the purchasers of the milk, is by way of market surveys for the entire consumer public, or even a few sample affidavits of milk consumers, along with the affidavit of [Raabi]” (para. 14 of the decision). On the other hand, the court left open the question of whether it was possible to award general compensation to the entire plaintiff group based on this form of proof.  In addition the court ruled that insofar as in accordance with the standard silicon was prohibited for the use of cows'  milk for drinking, there was no need to rule on the question of whether its use constitutes a health hazard, but it added that when examining the non-pecuniary damage caused by an infringement of autonomy and negative feelings, importance attached to the question of whether there are studies that show the possibility of damage to health as a result of the use of silicon and the question of the quantity necessary to cause such a risk. The reason for this is that if there are experts who contend that there is a possibility of damage to health, then it becomes necessary to address the question of  the consumer’s right “to decide whether he was interested in refraining from taking any risk involved in the consumption of the  milk”. The court further ruled that to the extent that there was proof for the ground of the claim and the alleged damage, and it was determined that compensation should be ruled for the benefit of the group or the public, it would consider the appointment of an expert- examiner and Tnuva would be obligated to supply him with the required economic data.

On 13 October, 2004 the Court actually appointed an expert-examiner in accordance with Regulation 124 of the Civil Procedure Regulations, 5744-1984  (Prof. Yechezkel Ofir, an expert in economic and marketing (hereinafter – Ofir)), and in its decision of 17 March, 2005  the Court further ruled that “the relevant population for this claim is, essentially, the people who actually purchased the milk” and that the intention was to those who purchased the milk in Israel (para. 16 of the decision). All the same, in that decision the Court ruled that the plaintiff group would also include persons who had consumed the milk in hotels, restaurants, and cafes (as distinct from those who consumed it at places of work and who did not actually purchase the milk that was consumed), notwithstanding that with respect to them it would be difficult to prove an infringement of autonomy because they did not choose the category of milk that they had drunk..

 

The Partial  Decision of the District Court

7.    In its partial decision of 7 October 2008 the District Court ruled that the class action suit should be accepted.  In its opening comments the Court noted that the Class Action Law, 5766-2006 (hereinafter – “the Law” or the “Class Action Law”) which was enacted and came into force after the certification of the suit as a class action, would also apply to suits pending at the time of its publication, and hence would also be applicable to this particular class action suit. Even so, the Court ruled that “regarding the ground of claim and the plaintiff group, a decision would be given in accordance with the Consumer Protection Law, which as stated, only applies to the a “consumer” as defined in the law”, while also pointing out that with the enactment of the Class Actions Law, the representative plaintiffs had not petitioned to amend the statement of claim and broaden the scope of the group in accordance with the broadened grounds of claim for which a class action can be filed under the Law.

In the partial decision the Court conducted an extensive survey of the evidentiary material submitted to it, including, inter alia, the Report of the Danon Committee, an expert opinion and public opinion surveys. Regarding the criminal proceedings, the Court held that for purposes of the class action it was not possible to base "factual findings" on the holdings of the Court in the criminal proceedings, inter alia because in that proceeding, witnesses were not heard and evidence was not submitted. Still, the Court ruled that Tnuva's admission to the commission of the offences and the convicting verdict also constitute evidence against it in the proceeding at hand ( whether by force of an admission of a litigant or by force of the provision of section 42A of the Evidence Ordinance [New Version] 5731-1971).  

As a preliminary remark, with implications for both the grounds of the suit and the proof of damage, the Court ruled that it was not required to rule on the "scientific question" pertaining to the existence of a health risk in the drinking of milk containing silicon, and that for purposes of the suit it was sufficient to examine the question of whether it was possible to rule out the possibility of such a health hazard. The Court determined that based on the evidentiary material presented, it could rule that even if there was no proof that the drinking of milk containing silicon caused, or was liable to cause immediate health damage to the consumers, it was not possible to rule out the existence of a health hazard in the long term, especially for children. The Court added that according to its approach, the consumers were entitled to know that the milk contained silicon  in defiance of the law and the relevant standard,  and that in these particular circumstances it was not possible to rule out the health risk involved its consumption, and it also added that had it been required to rule on the aforementioned scientific question  it would answered it in the affirmative, given  the existence of a standard which was presumably based on considerations of  public health and which would transfer the onus of proving the absence of a health hazard to the party in breach, and Tnuva, had not discharged that onus.

8.    In adopting Raabi's version, which was that he purchased within the State of Israel (and not within the areas of Judea and Samaria) as claimed by Tnuva, low fat long life mile of Tnuva which was produced in the Tnuva dairy in Rehovot in the period relevant to the suit, the Court held that Raabi has a personal ground of claim against Tnuva. The Court likewise held that even had its conclusion been different it would not have determined the fate of the class action, inasmuch as following the certification, the suit was that of all of the members of the group, and at all events, it was possible to replace a representative plaintiff who lacked a person grounds of claim, by force of s.8(c) (2) of the Class Actions Law

Regarding the existence of the ground of misleading, the Court noted that in fact it was not disputed that Tnuva misled its consumers and added that "misleading" is too delicate a word to describe Tnuva's conduct, which bordered on consumer fraud". This act of misleading, he added ,was done intentionally with respect to matters that were most definitely essential from the consumers' perspective, because it was an act of misleading regarding the essence and nature of the product (s. 2(a)(1) of the Consumer Protection Law), its components (section 2(a) (2) of the Consumer Protection Law), the risks involved in its use (s. 2(a)(4) of the Consumer Protection Law), and relating to its compliance with the standard (2(a) (11) of the Consumer Protection Law). The Court stressed in this context that the milk was a product that was supposed to be "as pure and natural as possible" and that to a large degree it was consumed by a relatively vulnerable population. It should also be added that the misleading in this case was compounded with the breaching of the obligations imposed on Tnuva by force of the Standards Law, and in this context the Court addressed the fact that the Israel Standard relating to drinking milk which prohibited the addition of silicon to milk is a binding official standard which also involves (as opposed to the "general" Israeli standard) "significant obligations", and it is prohibited to produce or to trade in a product that does not comply with its conditions.  By the same token, Tnuva did not indicate the existence of the silicon supplement on the packaging, and in doing so breached its disclosure duties pursuant to section 4(a) of the Consumer Protection Law, because the product that did not meet the requirements of the standard and was substantively defective and in accordance with section 17 (a) of the Consumer Protection Law.  The Court further held that once it was proved that Tnuva as a dealer had made a misleading representation, the assumption should be that the consumers were exposed to the representation and acted upon it, and the Court emphasized that misleading with respect to the Consumer Protection law can also take place by way of failure to make proper disclosure. In this context the Court further ruled that it was not necessary to prove what exactly each consumer knew and the presumption was that the consumer placed his trust in the dealer and there were no grounds for imposing a duty upon the consumer to clarify whether the product he had purchased complied with the requirements of the Law or the standard.  In view of this the Court ruled that in the case before us the foundation of misleading was fulfilled.

9.    In referring to the rule established in CA 1977/97 Barazani v. Bezeq Israel Telecommunications Company Ltd, [2] at p. 584 (hereinafter "Barazani"); and FHC 5712/01 Barazani v. Bezeq Israel Telecommunications Company Ltd [3] at p. 386  (2003) (hereinafter Further Hearing Barazani the Court noted that the misleading of a consumer constitutes a grounds in tort, by force of the provision of s. 31 (a) of the Consumer Protection Law, and that as such, it was subject to the "doctrinal first principles of the Tort Ordinance [New Version]. The Court further added that even if it was a conduct based grounds (as opposed to consequential) for the purposes of the receiving compensation it was necessary to prove damage and a causal connection between the act of misleading and the damage, as wall as the consumer's awareness of the misleading picture and his reliance thereupon. In our case, so ruled the Court, there was misleading by way of omission, "and it is undisputed that the consumers relied on the fact that the milk that Tnuva produced complied with the requirements of the Law and the standard also indicating that Tnuva never claimed to the contrary.

Regarding the categories of damage by dint of which the action was approved as a class action, the Court noted that these included "non pecuniary, non-tangible, damage that included  negative feelings, such as the feelings of disgust, mental anguish and discomfort, as well as the infringement of individual autonomy" , the thrust of which was the right to formulate a decision  whether to agree to a certain proceeding, in a considered, intelligent and informed manner and with knowledge of the relevant facts. The Court further noted that the non-pecuniary damage caused as a result of the infringement of autonomy admitted of compensation even in the absence of bodily damage, in accordance with the criteria established CA 2781/93 Daaka v. Carmel Hospital, Haifa  [4] 526 (hereinafter – Daaka).  In that context the Court rejected Tnuva's claim that the suit should be rejected given that the injury falls into the category of a "trivial matter", holding that that fact of the damage being mild need not stand in the plaintiff's way, and the very fact that the act damaged the public at large indicates that the act is not trivial.  According to the Court's approach, the severity of the act in this case must be assessed from the perspective of the group in its entirety and not that of the individual consumer.  According to this approach an act consisting of the misleading of the broad consumer public regarding the contents and legality of the production of milk, which is a basic product, cannot be considered as "trivial"..

Regarding the proof of personal damage that was caused to  Raabi, the Court adopted the essence of his claim, which was that as a result of his exposure to the case he experienced negative feelings such as disgust, anger and annoyance by reason of the fraud  and anxiety regarding the consequences of drinking.  The Court noted that though it could be argued that Raabi's feelings were "exaggerated" it was not possible to argue with subjective feelings., and it rejected Tnuva's claim that his feelings stemmed from the publications in the media according to which silicon is suspected of being a carcegengous product. Regarding the damage caused to the members of the group, the Court noted that in principle they were obligated to prove the alleged damaged that they sustained, but that in a mass collective action, as in the case before us, it is not practically possible for each one of the members of the group testify, or even to actually locate all of the milk consumers.  Referring to Regulation 9 (c ) of the Consumer Protection (Procedure for a Class Action), 5755-1995, and s. 20 of the Class Actions Law, the Court ruled that under these circumstances it would suffice to prove the damage in "from a general perspective". The Court noted that the representative plaintiffs had sufficed with the testimony of Mr. Raabi and in the expert opinion prepared by the experts Prof. Mevorach and Dr. Katz on behalf of Maagar Mohot based on a telephone consumer survey (hereinafter: “computer survey”), and that they should rather have filed the affidavits of a number of consumers; however, its position was that the evidence filed was sufficient for the proof of the damage and the determination of its rate, and in this context the Court rejected the claims raised by Tnuva against the consumer survey and its reliability, noting inter alia that drafters of the expert opinion had made a reliable impression, and that they had knowledge and experience in their field.

10.  Giving detailed consideration to the results of the consumer survey the Court noted that the survey indicates that the range of negative feelings (including revulsion, anxiety, fear, anger hatred, disappointment) were to a large or intermediate degree shared by about 66% of the milk consumers. At the same time, the Court accepted Tnuva’s claim concerning a certain inconsistency between the data presented and its claim that in the fifth question, (pertaining to the time at which the negative feelings emerged) the interviewees should not have been presented with the representation whereby the publications concerning the health hazards of silicon were verified both by the Ministry of Health and by Tnuva. However, since the two questions defined by the Court as “cardinal” questions in the survey  (the feelings of the interviewees and the grading of their severity) were asked before the question tainted with the aforementioned defect,  the Court deemed that there was no concern  that the survey  was  biased. The Court was prepared to assume, to be on the safe side,  that the survey’s findings tended to somewhat exaggerate the negative feelings, but ruled that this did not lead to the conclusion that the survey was defective in its entirety, and it further held that it had been persuaded that the survey was adequately grounded and that its findings were consistent with plain common sense.

In this context the Court further added that Tnuva on its part had sufficed with claims against the consumers survey presented by the representative plaintiffs, but did not present its own consumer survey from the relevant period and one can only wonder why. Accordingly, despite the element of exaggeration evident in the survey data presented by the plaintiffs, the Court deemed that its conclusion should be accepted, namely that various non-pecuniary damages were caused to the majority of the consumers, unrelated to the question of the health hazards involved in the consumption of milk containing silicon. On this count the Court dismissed Tnuva’s claims, based on the survey conducted by Prof. Gotlieb on its behalf in 2004 and the expert opinion of Prof. Hornik and Prof. Perry that it had submitted.  The Court stated that indeed there is a hierarchy in the categories of infringements of individual autonomy, but this, and the conceivable existence of damages graver than those in the case at hand, does not compel the conclusion that Tnuva’s conduct did not cause a substantial infringement of the consumer’s autonomy. The Court also rejected additional arguments made by Tnuva concerning the proof of the damage in this case, pointing out, inter alia, that for purposes of proving the damages head of infringement of autonomy it was not necessary to prove that the plaintiff would have refrained from acting in the manner that he acted had he been aware of the true situation, and for our purposes – that the consumers would have refrained from purchasing the milk had they known that it contained silicon.  A fortiori there is an infringement of the  consumers’ autonomy when it can be reasonably assumed that most of them, indeed, would not have purchased the milk had they known that the “classic health product” was actually manufactured in defiance of the Law and the standard, using silicon at a rate that was ten times greater than the rate permitted in other food products, and especially if they had known that some of the experts maintain that consumption of milk containing silicon may be a health hazard.  In this context the Court rejected Tnuva’s argument that silicon is a food supplement in other food products and is not harmful, pointing out that the silicon was purchased by Tnuva as a cleaning product, and which was not supposed to have been in the milk. The Court further noted that the infringement of individual autonomy emerges clearly from the consumers’ survey, but its approach was that it was not necessary to produce evidence of this damage – “the infringement of autonomy occurs along with the violation of the obligation to provide the consumer with all of the information, and the violation is an immanent result of tortuous conduct. The denial of the consumers’ right to decide whether to purchase and consume Tnuva milk, in a balanced, informed and knowing manner, being aware of the relevant facts, constitutes independent remunerable  damage, even in the absence of any other damage, and even absent proof that the consumers would have avoided purchasing the milk had they known all the facts”.  The Court added that the fact that Tnuva concealed  the insertion of the silicon into the milk from its consumers, combined with the fact that this was a matter critical for the consumers, is proof of the infringement of the consumer's autonomy in terms of being denied the right to choose the product of his choice in a considered, intelligent and informed manner, in other words the right to prefer a product that does not contain silicon manufactured in compliance with the requirements of the law and the standard. The Court further ruled that the right to autonomy is a basic constitutional right, the infringement of which mandates a appropriate and significant compensation.

11.  Regarding the evaluation of the damage the Court held that it was appropriate to have consideration for the gravity of the infringement of the right on Tnuva’s part in this case, and the infringement’s influence on the consumers’ decision and its degree of importance for them (in as much as the issue concerns a basic, “pure” product consumed by a vulnerable population. The Court added that even after giving consideration for the fact that the feelings of the interviewees may have been significantly affected by the media publications concerning the health hazard attendant to the consumption of milk containing silicon, half of those asked experienced negative feelings that are unrelated to anxiety, and it ruled that feelings of anxiety do not necessarily stem from the publications, but rather from Tnuva’s conduct. In this context the Court rejected the claim that the media publications severed the causal connection between the acts of Tnuva and the damage, stressing that the consumer cannot be expected to undertake an in-depth investigation of medical studies before he purchases milk, and if the addition of silicon to the milk was proscribed by law and the standard, and there are experts who deem that it may constitute a health hazard under certain circumstances, then the fear of the consumers is understandable and natural. This concern, it was ruled intensifies the infringement of the consumer’s autonomy,  just as it intensifies the accompanying negative feelings. The consumer is permitted to assume, and presumably did assume that the milk standard is intended to protect his health , and when Tnuva absolutely ignored the standard, the fear for health is justified and well based, even without the publications to the effect that silicon is suspected of being carcegenerous.

Accordingly, it was held that it had been proved that the group in its entirety had incurred damage by reason of infringement of individual autonomy.  The Court further determined that about a half of the group’s members suffered non-pecuniary damage that found expression in various negative feelings, based on the consumers' survey and an estimation that took into account the possibility that exaggerated media publications had partially contributed to the negative feelings.

Regarding the size of the group, in other words, the number of consumers in Israel who purchased the silicon during the determining period (between 23 October, 1994 and September 1995) for domestic needs, or for hotels, restaurants and cafes, the Court endorsed the expert opinion of  Ofir, the court expert, being impressed by his reliability and expertise, and preferring it over the expert opinions submitted by Tnuva.   The Court further mentioned that Ofir had determined (based on the weighted average of the various methods of calculation) that 166, 307 households had purchased the milk, but given that in an average household a number of people purchase milk, Ofer determined that the number of people who had purchased the milk ranged between 166,307 (number of households) and 330,000  (adult purchasers) with a tendency towards the lower number. This being so, the Court determined that the number of members in the group, i.e. the adults who purchased the milk during the relevant period, was 220,000 people, and that the members of this group were entitled to compensation for an infringement of their autonomy and a half of them were entitled to additional compensation by reason of negative feelings.  

12.  The plaintiffs requested that the remedy be calculated the sum of the damages to be awarded to each one of them  multiplied by their total numbers and in this context the Court noted that the high road was indeed that of individual compensation for each member of the group (sections 20(a)(1) and 20 (a) (2) of the Class Actions Law). This however is only possible when the number of members in the group is not large, when their identities are known and where they are able to prove their damage in the customary manner. On the other hand, there is a need for a certain degree of flexibility in proving damage when there is a practical difficulty of requiring each group members to prove his claim in the customary manner (by reason of their large numbers or because they cannot be expected to retain the relevant documents), and also where there is no practical means of locating all the members of the group  or where many of them will simply not bother to prove their damage due to its low rate. To overcome the difficulties involved in proving damage, its allocation and quantification in such cases, case law in the U.S.A developed a mechanism known as (FCR) Fluid Class Recovery, which was dwelt upon extensively by this Court. The Court did not ignore the fact that the case law in the U.S.A in this context is not uniform  but deemed that with the necessary caution “ideas can be drawn from it” for our purposes, while stressing that from the Explanatory Note to the Class Actions Law it emerges that the Israeli legislator “had this mechanism”. The Court referred to section 20(a) (3) of the Class Actions Law in accordance with which the Court is entitled to award overall compensation to a group, indicating that this section refers to the granting of a personal remedy to the members of the group and seeks to overcome the difficulty in calculating personal damage. The Court likewise referred to section 20 (c ) of the Law that allows an award of a general compensation to the public  or to the members of group, all of them or in part, while pointing out that this section is intended for cases in which it is not possible to locate the members of the group or to pay them compensation on a personal basis, notwithstanding that for purposes of granting this remedy too it is appropriate “to attempt to evaluate the sum of personal compensation owing to each individual member of the group in order to determine the sum of the overall compensation, and to ascertain that the sum of overall compensation does not exceed the estimated sum of aggregate damage that was caused to the group members…. it is likewise important to determine, at least by way of estimation the number of members in the group. This will assist the court to determine in the most accurate manner possible the overall sum for the group, for purposes of granting a remedy to the group or to the public” (para. 107 of decision).

On the other hand, the Court stressed that this sum of overall compensation does not necessarily reflect the product of the sum of personal damage suffered by each member multiplied by the number of members in the group, and some of the group’s members may actually not receive compensation at all, whereas other, non-members, will benefit from the compensation. The Court further added that the infringement of autonomy and the “negative feelings” in this case are at all events non-pecuniary damages the determination of which by definition requires estimation and hence by nature cannot be precise.  Accordingly, it is possible to determine the compensation for non-pecuniary damage by way of estimation alone and then to multiply it by the number of members in the group, which can similarly be determined on the basis of estimation, or the global payment can be determined by way of estimation. The Court mentioned that at all events, the unavoidable reality of it being an estimate need not negate the granting of a remedy in the group’s benefit. The Court did not ignore the fact that section 20 (a)(3) of the Law states that the court may award an overall pecuniary compensation that will be divided between the members of the group, provided that it admitted of “precise calculation” but it deemed that this term should be interpreted in accordance with the purpose of the law and the section.  The Court further mentioned that this term is missing from section 20 (c ) of the Law, which deals with a remedy for the benefit of a group or the public and that s. 20 (e) of the Law stressed that the demand for the proof of damage would not prevent compensation for non-pecuniary damage. The Court further mentioned that occasionally the practical goal of the legal process requires that compensation be awarded in accordance with a uniform criterion even if it is clear that there are differences between the various plaintiffs, and this is the case at hand. The Court addressed the consumers survey that was presented and ruled that it proved the damage relating to the negative feelings in accordance with the degree of certainty required in a civil proceeding, especially having consideration for the fact that it only concerned the criterion or calculating the global compensation that could be determined on the basis of an evaluation. Similarly, the Court noted that in the decision pertaining to application for confirmation of the suit as a class action, the Supreme Court assumed that there was no escaping the award of compensation for the benefit of the group, and it further mentioned that Tnuva’s claims in the respect undermine the decision to approve the suit as a class action. The Court further rejected Tnuva’s alternative claim to the effect that at the very most it was possible to base the compensation on “wrongful profit” that it gained by reason of the acts forming the subject of the suit. The Court likewise rejected Tnuva’s claim that at the end of the day it had only incurred losses by reason of the affair and as such it had no wrongfully gained profits. The additional claim raised by Tnuva as an alternative claim, argued that the profit made reached amounted to NIS 350,000 only and it was likewise rejected by the Court

Regarding the determination of the damage, the Court stressed that in its claim sheets Tnuva did not refer to section 20 (d)(2) of the Class Actions Claim which authorized the court to have consideration for the damage liable to be caused to the defendant or to the public requiring its services due to the payment of the compensation.  All the same, and even though no claims or explicit data was presented to it regarding this matter, the Court ruled that the evidential material indicated that the compensation would not impair the ongoing activity of Tnuva or jeopardize its economic stability and that at the very most, the compensation would have a negative effect on its profits in the near future. The Court similarly emphasized that in order to achieve the aims that are at basis of the class action, the remedy for the plaintiff groups must be efficient and substantive.    

13.  For all of the reasons mentioned, the Court decided on a monetary remedy in favor of the group, by force of s. 20 (c) of the Class Actions Law, to be calculated on the basis of an identical sum for each member of the group. The Court further ruled that awarding compensation for the sum of NIS 8000 for each member of the group, as requested by the representative plaintiffs, was perhaps appropriate for a personal claim, but in this particular class action would have meant a monetary remedy amounting to an overall sum of NIS 1.76 billion, which is unreasonable. Having consideration for the entirety of the data, the Court ruled that Tnuva should pay a global sum of NIS 55 million, which reflects personal damage at the sum of NIS 250 for each member of the group (NIS 250 X 220,000), while pointing out that this sum, and even in excess thereof, was most definitely suffered by each members of the group, even if only by reason of the breach of individual autonomy.

The Court further determined that the sole practical remedy was the remedy in favor of the group, which should be divided in accordance with three objectives:

       (1)        Awarding a benefit to the members of the group by  reducing the price of the product (or increasing its contents without raising the price). The Court noted the difficulties involved in the realization of this remedy, noting that its certification would require an economic expert opinion, the certification of the Director of Antitrust and the position of the Attorney General, and supervision of its execution by force of s. 20 (f) of the Law;

2. Transfer of  part of the compensation sum to a research and scholarship fund in the field of food and nutrition which have implications for public health
3. Distribution of milk free of charge to populations in need via non-profit organizations so involved.

The Court further ruled that “the allocation of the sum between the three approved objectives will be determined after it becomes possible to confirm the discount from the price, in accordance with the conditions determined, and after an allocation plan is filed for the two other objectives”, and it noted that it could be expected that the parties would reach agreement concerning the manner of allocation of the sum of compensation in accordance with the above, so that the Court would not be compelled to enforce a settlement upon them.

Regarding the compensation for the representative plaintiffs and the legal fees for their attorney, the Court noted that the application for a legal fees award for the sum of NIS 400 million is unreasonable and unfounded. It further ruled that at that stage the compensation and legal fees should not awarded given that the final conclusions had yet to be drawn regarding the manner of allocating the overall sum of compensation, but after having considered the criteria for the determination of the rate of  legal fees and compensation, the Court ordered the payment of an intermediate sum “against the account of the final sums” as follows: compensation to Raabi's heirs for the sum of NIS 150,000; compensation to the Consumers Council for the sum of NIS 250,000; legal fees for the sum of NIS 500,000; and court expenses for the sum of NIS 100,000.

Tnuva rejected the partial decision of the trial court and appealed against it in this Court (CA 10085/08; hereinafter – the Tnuva appeal); the representative plaintiffs on their part filed a counter appeal against the decision (hereinafter: the appeal of the representative plaintiffs) but before the hearing of these appeals, the District Court gave a supplementary decision

The Supplementary Decision of the District Court –

The Final Compensation and Legal Fees Awarded and the Manner of Allocating the Compensation

14.  In the supplementary decision of 17 June 2009, the District Court gave effect to the agreements reached by the parties, with the cooperation and the agreement of the Attorney General. The agreements were as follows: (a) The allocation between the three objectives would be – the discounts arrangement 22%, the research and scholarship fund 33.33%, and the distribution of milk products to the needy 44.6%; (b) the distribution of milk products (not only the long lasting milk forming the subject of the suit) would be over a period of five years, beginning as of the commencement of fulfillment of the decision, via a NPO known as "Latet" ["To give" – Trans.] and Mishulhan leShulhan  ["From One Table to another Table" – Trans.]; (c )For purposes of transferring the compensation for research purposes in the field of food and nutrition, a research fund would be established, headed by the Chief Scientist of the Ministry of Health. The management of the fund (whose members are stipulated in the agreement) will select the research programs that will be entitled to the scholarships and supervise them. The sum of the compensation will be utilized over a period of five years, unless the need arises to continue to use the sum thereafter as well; (d) the particulars of the discounts arrangement will be formulated following the decision on the appeal filed against the partial decision and will be based on the existing data at that time and will apply to all categories of long lasting milk (1% to 3% fat)  and will be completed within five years from the commencement of execution. This arrangement merited the certification of the Director of Antitrust but the Court noted that there might be a need to return to the Court in the event of a significant time period passing until the beginning of its execution. The Court further mentioned that should the parties fail to agree on the details of the discounts arrangements, it would appoint an expert to determine its details. The Court further added that the execution of the partial decision in accordance with the agreements specified would be delayed until  a decision was given on the appeal that was filed against it.

Regarding the final compensation and legal fees the Court ruled that the interim sums determined in the decision were to be supplemented by the following sums: Raabi’s heirs would receive compensation for the sum of NIS 350,000; the Consumer Council would receive compensation for the sum of NIS 750,000; the attorneys of the representative plaintiffs would receive the sum of NIS 2,000,000 and regarding this the parties agreed that the compensation would be paid within thirty days of handing down the supplementary decision, as well as 60% of the fees that was to be awarded and that payment of the balance would be postponed until after the decision on the appeal. Finally, the Court ruled that an advertisement should be published in the three main newspapers, including the central elements of the decision.

The parties have also challenged the supplementary decision before us.  The representative plaintiffs on their part appealed this decision ( CA 6339/09) and Tnuva too  has requested our intervention (CA 7607/09). The parties' claims in the appeals against the partial decision and the supplementary decision (which will hereinafter be jointly referred to as “the decision” were filed together). 

Tnuva’s Claims

15. Tnuva claims that the Lower Court's decision should be overturned, and alternatively that the sum of compensation ruled against it should be significantly reduced. They claimed that the District Court had aimed at accepting the class action and had avoided the accepted procedural rules. Tnuva further argues that from the decision it emerges that the basic principles of tort law do not apply to consumer class actions for non-pecuniary damage, and that this unlawfully defies the parameters of the Class Actions law contrary to its language, its guiding principles and in defiance of the law determined in the further hearing in the matter of Barazni [2] . Tnuva claimed that the Lower Court actually cancelled the requirement for a causal connection between the misleading and the damage, and emphasizes that in the decision in the matter of Daaka [4] the infringement of the autonomy stemmed from the urgency of the information and its centrality in the individual decision making process. It follows that when the information does not influence the individual decision making process there is no basis for awarding him compensation. Alternatively Tnuva claims that if the  Daaka  [4]  decision is interpreted as a decision that which abandons the requirement of the causal connection, it should be restricted to its specific context and the exceptional circumstances in that case that pertained to the infringement of  informed consent to medical treatment, and it claimed that a deviation from the classical rules of tort is not justified in the context of the tort consumer deception and deviates from the Supreme Court’s decision in the Barazani Further Hearing [3]  Here, Tnuva refers to the Court’s decision to the effect that for purposes of compensation under the tort head of infringement of autonomy, there is no requirement for an examination of the personal particulars of each victim, and the conclusion is that the victim himself does not constitute a factor in the calculating formula

Tnuva further claims that the representative plaintiffs did not prove that they incurred any damage as a result of its acts and that in fact, the damage was caused as a result of media publications and not as a result of the negating of their choice in purchasing milk. Tnuva further claims that  the Court erred in its estimation of the  sum of compensation in a uniform manner for all members of the group, notwithstanding the differentiation in the sum of compensation that the members of the group are prima facie entitled to based on their personal particulars. Its claim, which it seeks to anchor in the Israeli and American case law, is that non-pecuniary damages are by definition individual and cannot be assessed in a uniform manner, and that they include the damage caused by infringement of autonomy which likewise is individual-subjective. Furthermore, Tnuva claims that in the case at hand compensation for the group and the public should not have been awarded and that at all event there was no basis for calculating the overall damage based on a simple multiple of the number of members in the group by the rate of personal damage. Tnuva also claims that the sum assessed by the Court as representing the damage from which each member of the plaintiffs group suffered  - NIS 250 – is an arbitrary sum that was determined without any supporting evidence and without giving any substantive reasons for the manner of its determination.  In addition, Tnuva points out that in awarding a uniform damage the Court failed to distinguish between the members of the group, who according to its own determination had suffered from negative feelings as a result of the consumption of the milk, and those who did not suffer these feelings; nor did it distinguish between those for whom the fact of the addition of the silicon would have influenced the decision to consume the milk and those for whom it would not have influenced is consumer conduct.

16.  Tnuva also claims that the overall compensation awarded by the Court is exaggerated and unprecedented and it stressed that its entire profits from the sale of milk during the relevant period stood at  NIS 3.4 million. The claim was that the Court actually awarded penal compensation as attested to by the “penal” terminology that is used in the decision, even though this has not place in the framework of a class action, in accordance with the provisions of section 20 (e) of the Law.

Tnuva found an outstanding example of this in the Court’s rulings regarding the health hazard in the consumption of food containing silicon and argued that the sole purpose of the discussion of the matter was to clarify to the reader exactly “why Tnuva is deserving of a punishment”. Tnuva claims that in this matter the Court handed down contradictory decisions as well as decisions that contradict that which was stated in the decision relating to the certification application. It further argues that the trial court avoided the exercise of its authority to rule on the veracity of the claims of the representative plaintiffs, and that it imposed a “featherweight” evidentiary because it contented itself with the existence of a few studies (which were presented to it incidentally), without ruling on their veracity, and without having been presented with a detailed expert opinion on the matter. Tnuva emphasized that the official standard prohibited the addition of any substance to the milk (apart from Vitamin A or D  in particular circumstances) and did not relate specifically to the addition of silicon. Similarly, Tnuva claimed that the official force of the standard had already expired in 1998 and that it was no longer binding upon milk producers, and that in other standards it had been permitted to add silicon to food products, even to such as are consumed by infants, in quantities similar to those that it added to the long standing milk and in dimensions in excess of those involved in the case at hand. Tnuva further added that the trial court’s determination that the health hazard could be inferred from the very violation of the standard was unfounded and was actually in contravention of the provision of s. 17C (a) of the Standards Law. Tnuva further argued that the absence of a health hazard from the consumption of silicon may be inferred from the Danon Committee Report and the holdings of the court in the criminal proceeding conducted against it. At all events, its approach was that even given a determination of the possibility of a health hazard, this would not constitute sufficient basis for a ruling of compensation, because compensation cannot be ruled  based on a possibility, not proven, of negative feelings being caused by a theoretical risk to health.  In this context Tnuva added that the Court’s determination to the effect that milk is a “natural and pure” product cannot stand, because the consumer conception is that milk is a processed product that contains different food supplements and only a minority of consumers are of the opinion that was presented by the Lower Court.  Tnuva also dwelt on the discrepancy between the compensation awarded in the case at hand and the compensation ruled in other class actions.

17.  Tnuva further claimed that s. 20 (c ) of the Class Actions Law establishes  compensation for cases in which there is  no possibility of determining or locating the members of the plaintiff group, and hence the Lower Court erred when determining that the section applies when it is not possible to determine the sum of the damage.  Tnuva stresses that the section was not intended to “supersede” the regular rules of evidence and to enable an arbitrary determination of the amount of scope of the damage and sums of compensation. Furthermore, Tnuva argues that the Lower Court erred in determining that the compensation mechanism of s. 20 (a)(c) of the Law differed from that of s. 20 (c) of the Law, claiming that compensation under s.20( c) was also subject to the requirement of “precise calculation” prescribed in s. 20 (a)(c ) of the Law.  Accordingly, compensation for the public benefit or for the benefit of a particular group can only be awarded when personal compensation would not be practical were the requirement of “precise calculation” to be complied with.  Tnuva submitted that insofar as the case at hand does not admit of accurate calculation of the damage or even estimation based on “stable” statistical data, the Court had no choice other than to reject the suit. Tnuva further added that in the U.S.A., when there is no possibility of accurately calculating the damage to a group or where the damage is non-pecuniary, the Court does not approve the filing of a class action.

Alternatively, Tnuva claims that even if the case at hand warrants the ruling of compensation for the benefit of the group’s members, it should not have been assessed in the manner adopted by the Lower Court.  Its argument was that since the damage caused to each member of the group cannot be determined it is not correct to arbitrarily determine the compensation based on multiplying any particular sum of damage by the number of members in the group. Rather, it should be based on the "wrongful profit" that it accumulated.  Tnuva claims that compensation based on calculation of profit overcomes the difficulties in the case before us: it would  reflect the consequences of the event that gave rise to the suit; it would prevent the difficulty of assessing non-pecuniary damage and the unified "pricing" of the negative feelings, despite the differences between the members of the group. It will also prevent the difficulty of assessing damages in accordance with unsubstantiated surveys. According to Tnuva, the profit it gained from the execution of the wrong is NIS 1,645,900 in the terms of the principal, and with the addition of the interest and linkage differentials (from the middle of the period) it  comes out to NIS 4,981,616.  Alternatively, Tnuva claims that the compensation should be calculated based on the sum saved by using the silicon to solve the problem of frothing, which comes out to  USA$400,000 (which with the addition of linkage differentials and interests comes out to NIS4, 346,991). It was claimed that this sum can be supplemented by a reasonable deterrent factor. In addition, Tnuva claims that even if it be determined that the number of members of the group should be multiplied by any particular sum of damage, certain substantive defects in the method of evaluation  conducted by the Lower Court must still be remedied. Its claim was that this multiplication should only include consumers who suffer from substantive negative feelings due to the consumption of milk and it should not include feelings related to "positions or viewpoints" which they hold as a result of the Tnuva's conduct (such as temerity and contempt).  Tnuva's position is that based on the data presented in the court, consumers who answer that definition constitute about 15% of the members of the group defined by the District Court. Tnuva also maintains that the number of members in the group should be fixed at 166,000 (the minimal threshold determined in Ophir's expert opinion) and alternatively at 200,000 (allegedly claimed by Ophir in his testimony.

18.  Tnuva further claims that the sum awarded by the Lower Court for remuneration and legal fees is excessively high, emphasizing that it constitutes 7% of the total sum of compensation. In addition, it claims that this sum deviates from the  guiding criterion for such matters, prescribed in the Law (ss. 22 and 23 of the Law)  and in settled case-law. Regarding the Israeli Consumer Council Tnuva argues that the former did not invest significant work, nor did it assume any risk; that it is a budgeted statutory body and not a private person who requires incentives; that the Consumer Council did not initiate the proceeding and joined it at a relatively late stage; and finally, that its degree of involvement was minimal and negligible. Regarding the legal fees of the representative plaintiff's attorneys, Tnuva claims that the fee is unprecedented, that has no consideration for the manner in which the suit was handled and the discrepancy between the remedies that were requested and those that were ultimately awarded, and adds that the sums awarded by the  Lower Court are liable to pave the way towards abuse of the tool of the class action.

Claims of the Representative Plaintiffs

19.  In the counter appeal, the representative plaintiffs claim that  given the Court's holding that the sum of NIS 8000 for each consumer is appropriate for a personal claim, there is no justification for reducing it to NIS 250 just because the context is that  of a class action. They stressed that Tnuva too did not claim that the defense under s. 20 (d)(2) of the Class Actions Law was applicable to this case.  The representative plaintiffs further claim that the reduction of the compensation empties the class action proceeding of its contents and is inconsistent with the Court's determinations to the effect that grave damage was caused, justifying commensurate compensation. The representative plaintiffs add that increasing the compensation sum will not harm the public, inter alia having consideration for the sales data and profits of Tnuva, and they complain that the group of those represented was significantly reduced, to include only those who purchased the milk regularly, whereas it should also have included incidental purchasers.  They add that the sole reason for the reduction of the group was that Tnuva provided partial information to the court expert who was appointed for purposes of assessing the size of the group.

The representative plaintiffs further claim that Tnuva's pleadings ignore the decision given on the certification application, in an attempt to revisit an already settled matter. Regarding Tnuva's claims concerning the health risks posed by the milk, the representative plaintiffs claim that the Lower Court ruled on this matter in the wake of Tnuva's request to present evidence on the matter and that the findings themselves were over and above what was required. According to the representative plaintiffs, the very prohibition on the addition of silicon to the milk in an official, binding standard (published as a regulation of legislative effect) and its breach, combine to establish the grounds for claim in the framework of the suit. In addition, there was proof of the grounds for action under the Consumer Protection Law (also having consideration for the provisions of the Standards Law). It was proven that silicon posed a potential health hazard, and it was proven that Silicon was aware of the problem and of the defect involved in the addition of silicon to the milk. In this context the representative plaintiffs stress that when Tnuva purchased the silicon from the Amgal company, it made a representation that it was purchasing it as a cleaning material and they also stress that silicon was added to the milk at a rate that was ten times higher than the level permitted under the provisions of the silicon producer for purposes of using silicon in food (they claim that the silicon was added at a rate of one liter per 10000 liters of milk, whereas according to the manufacturer’s instructions it is permitted to add it at the rate of a “ten parts for a million”). The representative plaintiffs further claim that both in relation to Raabi and in relation to the group as a whole, damages had been proved with respect to infringement of autonomy and negative feelings relating to the consumption of milk. The representative plaintiffs stress that in this context it was proved that had the consumers been aware of the existence of silicon in the milk they would not have purchased it, and this is by virtue of both the importance of the official standard and the fact that its breach renders the product “worthless at best”. The representative plaintiffs also add that there are likewise no grounds for interfering with the findings of the Court regarding the occurrence of damage and the gravity of Tnuva’s acts in view of the positive impression made by the witnesses and the experts on behalf of the court. They also stress that the autonomy of the individual is a constitutional right, and hence its infringement should merit commensurate compensation, and they claim that this does not constitute an award of punitive compensation.

The representative plaintiffs add that there are no grounds for interfering with the Lower Court ’s holding that the damage caused as a result of the infringement of autonomy is an inherent element of the tortuous conduct, and that this is also the conclusion from the Daaka [ 4 ] ruling. In addition, they claim that in the present case it is appropriate to award uniform compensation based on an assessment stating that inasmuch as the right to autonomy is a constitutional right, it is an identical right for each member of the group, and that the provisions of the Class Actions Law enable a cumulative calculation of the damage incurred by all the members of the group. They further add that the damage caused in this case is essentially given to assessment by way of estimation; that the arrangements in the Law enable the proof of damage in a manner that is not particularistic and individually based but rather general and all inclusive and that the tendency in case law is consistent with the need to award uniform and equal compensation to all of the plaintiffs as such. The representative plaintiffs stress that this result does not contradict the ruling given in the Barazani Further Hearing [3] and they add that as opposed to Tnuva’s argument, the FCR mechanism does not negate awarding compensation in cases of this kind, indicating that in certain cases American case law awarded “average compensation” multiplied by the estimated number of members in the group. They further state that the FCR mechanism is essentially intended for the distribution of overall compensation, and that the current criticism of this mechanism pertains to the question of distribution of compensation to a group or the public and not to the manner of evaluation of the compensation in accordance therewith.  

20.  The representative plaintiffs further request to dismiss Tnuva’s argument for reducing the sum of compensation owing to them, emphasizing that the compensation  awarded to them constituted a mere  2.5% of the sum ruled in favor of the group as a whole. The attorneys for the representative plaintiffs argue that in fact the Court “punished” them for the discrepancy between the sum ruled in favor of the group (which was unjustifiably reduced) and the remedy which they petitioned for in the name of their principals. Their argument is that in this context the Court mistakenly applied the provision of s. 23 (b) (5) (which provides that in ruling attorneys fees the court may have consideration for the discrepancy between the remedy sued for and the remedy actually awarded), and that it failed to consider all the relevant factors  The attorneys for the representative plaintiffs claimed that they had done a significant amount of work, directing attention to the novel claims that they raised in the proceeding, and they challenged the Lower Court ’s determination that part of the proceeding had not been properly conducted, pointing out that all of their objections had been relevant.

The Class Action and the Consumer Protection Laws -  Meeting of Principles

21.The class action is a special procedural tool for the effective and efficient promotion of principles, values and substantive legal rights. This legal institution is currently regulated in the Class Actions Law which is a comprehensive and detailed framework law that established standard rules for the filing and conducting of class actions. The Law was enacted in 2006 after this Court called upon the legislator to regulate the institution of a class action in a comprehensive statutory arrangement (see LCA 3126/00 State of Israel v. E.S.T. Project Management and Manpower Ltd [5]; FHC 5161/03  E.S.T  Project Management and Manpower Ltd v. State of Israel [6],  but the importance of the class action had been recognized in Israel many years before the enactment of the Class Actions Law. Thus, a series of laws and “local” arrangements relating to the filing and conduct of class actions was already in place, most of which were incorporated as chapters in those laws during the nineties of the previous century. They included provisions that are essentially similar to  the criteria and conditions the fulfillment of which enables the filing of a class action in that particular realm. See Chapter F’1 of the Restrictive Trade Practices Law,  5748-1988 (hereinafter – the Restrictive Trade Practices Law); Chapter F’1 of the Banking  (Service for Customer) Law, 5741-1981 (hereinafter – the Banking Law); ss. 19 (54)   - 19 (64) of the Equal Rights for Disabled Persons Law, 5758 – 1998; s. 11 of the Male and Female Workers Equal Pay Law 5756- 1996. All of these specific arrangements were repealed with the enactment of the Class Actions Law (see ss. 32 – 35, 38 – 40, and 42 of the Class Actions Law) and even before its enactment, the E.S.T [6] decision negated the possibility of basing a class action on Regulation 29 of the Civil Procedure Regulations, 5744-1984, which until that time had served as a normative source and a procedural framework for the filing of class actions in areas lacking a specific statutory arrangement as mentioned above.

This  importance of the class action was discussed by this Court both before and after the enactment of the Class Actions Law in a series of decisions that address its advantages as a legal tool for enabling the realization of the right to file a personal claim in cases where the filing of a claim was not profitable or not feasible for the individual. In addition, this Court’s case-law has dwelt upon the importance of the class action in the promotion of public interest as a legal tool that assists in the efficient enforcement of the law and deters financial magnates who rely on the passivity of the individual, abuse their power, and harm unincorporated groups such as consumers or investors in securities. An additional element of importance of the class action considered in the case-law is that this procedure prevents the multiplicity of suites and hence saves judicial resources, and from this perspective too, the institution of class actions makes its contribution from a public interest perspective (for the definition of the objectives and goals of the Class Action, see s.1 of the Class Actions Act; on this matter see also: CA. 8430/99 Analyst I.M.S. Trust Funds Management (1986) v. Ard Industrial Investment and Development, [7] at p. 256; 8 LCA 4556/94 Tetzet v. Zilbershatz, pp. 783-785 [8]; CA 345/03 Reichart v. Raabi Moshe Shemesh Heirs, paras. 8 – 9 of opinion of the President Beinisch [9]; Sinai Deutch “A Decade for the Class Action  Suit – Interim Summary and Looking to the Future  Shaarie Mishpat 4, 9, 21- 24 (5765) (hereinafter – Deutch -  Decade for the Class Action); Steven Goldstein and Talia Fisher “Interaction Between Mass Actions and Class Action:  Procedural Aspects”  Mishpatim 34, 21, 24- 26 (5764) (hereinafter – Goldstein and Fisher)).

Along with the inherent advantages of the class action it should be remembered that incorrect use of this tool involves not insignificant dangers (see Analyst  [7], at p 256; Tetzet [8], FHC E.S.T [6] at p. 785 [6] at p. 237; Alon Klement “The Boundaries of the Class Action in Mass Tort”,  Mishpatim 34, 301, 325- 331 (5764) (hereinafter – Klement, Boundaries of the  Class Action)). The laws of class action and their judicial supervision are thus intended to maintain an appropriate balance between the risks and chances of the proceeding and to ensure  that it realizes the legal, economic and social goals for the promotion of which it was established (see CA 3506/09 Zaig v. Waxelman, Waxelman Accountants [10] paras. 7 – 8 ; and Tetzet [ 8] at pp. 785 – 786).

22.  One of the outstanding areas in which the advantages of the class action are demonstrated is the laws of consumer protection. Israeli legislation contains a large series of legislative acts intended for consumer protection. The central law in this context is the Consumer Protection Law, enacted in 1981. This law includes detailed provisions concerning the duties and prohibitions applicable to dealers, in other words, to manufacturers, importers, tradesmen  and providers of services, with the aim of subjecting the business sector to a regime of appropriate conventions of behavior, to establish fair game rules in dealer-consumer relations, and to prevent the misleading of consumers with regard to an asset or service that he consumes (on the goals of the Consumer Protection Law - see Sinai Deutch, Consumer Protection Law 120 – 126 (Vol. A. 2001); Explanatory Note for the Draft Bill (Hatza’ot Hok 1469, 302- 303, 5740).  Other laws intended for a similar purpose are for example, the Banking Law (Service to Customers), Supervision of Financial Services (Insurance) Law, 5741-1981 and the Restrictive Trade Practices Law. These laws and additional laws admitting of classification in the category of consumer protection law regulate various aspects of this protection and are intended to prevent unjust enrichment on the part of large financial concerns or on the part of State authorities, at the expense of the individual.  

The point of departure for consumer protection law is the structural imbalance that characterizes the consumer transaction when struck between a financial body, occasionally a large and multi-tentacled company, or even a retail trader and the individual consumer (assuming that he lacks the size advantage of organized consumption).  The legislator accordingly pinpointed this population sector as requiring intensified legislative protection to ensure that the dealer, having the advantages of knowledge and economic ability, does not misuse these advantages for reaping quick profits at the consumer’s expense, while deceiving him in essential matters affecting the nature of the transaction.  For example, the Consumer Protection Law seeks to ensure that when entering into a transaction the consumer has full and fair information concerning the nature and the details of the transaction, the assumption being that this will enable the consumer to plan his actions and enter into a transaction that is optimal and desirable from his perspective. Additional prohibitions in the Consumer Protection Law concern the exploitation of the consumer’s distress, exploitation of his physical or mental weakness, or his ignorance of the language, and the prohibition of exerting undue influence upon him (see CA 3613 Ezov v Jerusalem Municipality [11 ], at p. 801; LCA 8733/96 Langbert v. State of Israel – Israel Lands Administration [12], pp. 175- 176 (hereinafter – Langbert); Sinai Deutch “Consumer Class Actions: The Requirement for Personal Reliance on the Misrepresentation of the Deceiver” Nethanya Law Review 2, 97, 110 – 114 (5762) (hereinafter – Deutch, The Requirement for Personal Reliance). Apart from the importance of the consumer protection laws in redressing the imbalance of power between the dealer and the consumer and strengthening the consumer’s personal autonomy, these laws are also important in realizing public interest of inestimable importance such as: the notion of consumer sovereignty; protection of the right to welfare and social rights, promotion of the principle of fairness in trade, protection of the reliability of the local market, and maintaining trust in the social order and the provisions of the law.

23.  Having synoptically outlined the underlying objectives and goals of consumer protection law, and the objectives and goals of the class action as a legal procedural institution, we can easily identify the “meeting of principles” between the goals intended to be promoted by the class action tool and the values and rights that these laws seek to protect. Hence, the class action can overcome both the inbuilt balance of power between the dealers – those with the economic advantage - and the consumers, and the lack of profitability that frequently accompanies the filing of a claim by the isolated consumer, given the relatively small amount of damages he has incurred (See Barazani [2]; Deutch - The Requirement for Personal Reliance, 115. Regarding the systems for civil enforcement in the area of consumer protection, see Moshe Bar-Niv (Bornovski)).

Indeed, the tool of the class action is actually one of the most significant measures placed by the legislature at the consumer’s disposal for the enforcement of his rights under the laws of consumer protection (see Deutch – a Decade for the Class Action, 18 – 20 according to which most of the class actions filed in Israel are “consumer actions” by force of the various consumer laws.  On the other hand, the implementation of the provisions pertaining to consumer class actions has also been criticized. See Deutch “Consumer Class Actions – Difficulties and Proposed Solutions” Bar Ilan Law Studies 20,  299 (2004); see also CC (Center) 5567-06-08 (Nazareth) Bar v. Ateret Industries 1996 Ltd, para. 39  [  ] where the court observed that in many of the cases it would have been preferable had the consumer deception been handled in an alternate framework, such as the imposition of punitive compensation rather than as a class action proceeding). As mentioned, the provisions for filing a class action under the Consumer Protection Law used to be included in Chapter F’1 of that law, along with additional enforcement measures included therein, inter alia - the administrative mechanism in the charge of the Commissioner of Consumer Protection, and the Consumer Protection Authority, and the criminal system which purported to enforce the norms established by this law via the criminal law  With the enactment in 2006 of the Class Actions Law and the establishment of a comprehensive framework arrangement for the filing and conduct of class actions, came the revocation inter alia of Chapter F’1 of the Consumer Protection Law, so that as of today, as mentioned, the provisions of the Class Actions Law govern the filing and the conduct of class actions in all areas, including in the areas of consumer protection (see s. 3 of the Class Actions Law, and item 1 of the Second Schedule of the Law). 

Tnuva’s Act of Misleading

24.  The proceeding before us began with an application for the certification of a class action, filed in 1995 in reliance on the provisions of Chapter F’1 of the Consumer Protection Law. As described above in the chapter on the facts, already in 1996 the District Court approved the filing of Raabi’s personal claim as a class action, and Tnuva’s appeal against the certification decision was rejected by this Court in the year 2003 (CA 1338/97). The proceedings for the certification of the class action were similarly handled in accordance with the provisions of Chapter F’1 of the Consumer Protection Law then in force.  However, after the District Court began hearing the approved class action, the Class Actions Law was enacted, and as indicated by the decision of the Lower Court, its provisions provided the basis for the decision on various issues, including the provisions pertaining to the compensation and fees. The application of these provisions to our proceeding was correct, given the provision of s. 45 (b) of the Class Actions Law, which determines that the provisions of the Law (apart from the provision of s. 44) “shall also apply to application for a  certification of a class action and a class action that was pending before the court on the date of publication of this law” (see CA 7028/00 A.B.A. Trust Funds Management Ltd v. Elsynth Ltd [13] paras 16-18 ; HCJ 2171/06 Cohen v. Knesset Speaker [14] para. 46.  The Lower Court further added, and rightly so, that even though the Class Actions Law did not limit the grounds for a class action exclusively to the “consumer”, as defined in the Consumer Protection Law, the class action in this case should be adjudicated in accordance with the original grounds that were based on the Consumer Protection Law  and in relation to a consumer group answering the definition of “consumer” in that law (“one who purchases an asset…..primarily for his personal, domestic or family use”, given that the representative plaintiffs did not apply to amend the claim  and file additional evidence in the  wake of the new law, that broadened the circle of potential plaintiffs in this context (and see Alon Klement “Guidelines for the Interpretation of the Class Actions Law, 5766-2006), Hapraklit 49, 1354-135 (5767) (hereinafter – Klement).

25.    In the class action before us it is claimed that Tnuva violated the prohibition on misleading  established in s.2 of the Consumer Protection Law, which provides that

A dealer shall do nothing—by an act or an omission, in writing, by word of mouth or in any other manner—likely to mislead a consumer as to any matter material to a transaction (any such act or omission hereinafter referred to as a “misleading act”…)

The thrust of the misleading act ascribed to Tnuva is that Tnuva added silicon to low fat (1%) long lasting milk without this ingredient being mentioned on the packaging and in defiance of the official and binding standard in force at that time, and in so doing mislead the members of the group, consumers of long lasting milk regarding a “material aspect of the transaction” pertaining to the “the quality, nature, quantity and type of any commodity or service” (s. 2 (a) (4);  and “the conformity of the commodity or service to a standard, specification or model” (s. 2 (a)(11).

It was further claimed that Tnuva breached the duty of disclosure imposed on it as a dealer, pursuant to s. 4 (a) of the Consumer Protection Law, to disclose to the consumer, inter alia:

(1) any defect or qualitative inferiority or other feature known to him that materially diminishes the value of the commodity;

   Likewise it was claimed that Tnuva had breached the obligation of indication  as prescribed in section 17 of the Consumer Protection Law, which likewise expresses the broad duty of disclosure imposed on the dealer and which provides  inter alia that:

A dealer shall indicate the following particulars upon, or upon a thing attached to, goods intended for the consumer:

                          ------

(a)  the quantity of the commodity and a detailed statement of the basic materials of which it consists.

The prohibition on misleading and the duty of disclosure and indication imposed on dealers in accordance with the Consumer Protection Law, were intended to realize one of the Law’s central underlying goals, namely providing all of the information required by the consumer in order to enter into an intelligent engagement that gives true expression to the principle of the freedom of contractual engagement (see Langbert  [12], p. 175 – 176).

26.              The Lower Court accepted the claims of the representative plaintiffs, and in its decision ruled that the Tnuva had committed an act of misleading that was prohibited under the Consumer Protection Law and had breached its statutory duties of disclosure by adding silicon to the milk without disclosing that fact to the consumers and without disclosing that the addition of silicon as stated contravenes Standard No. 284 of the Israeli Standards Institution, which at that time was the official and binding standard for purposes of “cow’s milk for drinking” (hereinafter: “the standard).

Evidently,  at this stage of the hearing of the appeal, Tnuva no longer contests the fact that it mislead its consumers. Indeed, in the summations filed on its behalf in the appeal it confirms that it “mislead the consumers by way of omission in its failure to indicate on the packaging of the long standing milk that a froth preventing food supplement was added, bearing the trade name “E-900” (section 2.1 of Tnuva’s summations).  Similarly, it would seem that there can be no doubt regarding the consumer’s right to be aware of the ingredients of the product that consumes . This right is the basis of the duties of disclosure and indication imposed on the dealer in this context, which we addressed above, and it may be asserted that these duties become doubly important when considering that the issue concerns milk which is a basic food product consumed by numerous consumers.

As mentioned, one of the substantive matters to which the prohibition of misleading applies under the Consumer Protection  Law is the “conformity of the asset or service to the standard, specification or model” (s. 2 (a)(11)). In our case Tnuva contravened the prohibition in this sense too because the definition in  s. 105 of the standard enumerates the materials that can be added to the various milk products and silicon is not included among these products.  Our concern is with a standard  that was declared as the Official Standard on 13 October. 1987 (O.G. 3473, 2274). As such Tnuva is bound by s. 9 (a) of the Standards Law, which prohibits the production and the sale of a milk product that does not comply with the requirements of the standard (for an analysis of the grounds for declaration of a standard as official and the duties established by the standards (see Eliyahu Hadar, Behind the Standards Law, 56- 92 (1997)), and accordingly Tnuva mislead its consumers with respect to the product’s conformity to the standard (see also s. 107.5 of the standard, which establishes that the supplements – if added -  must be indicated, and see Official Standard No. 1145 regarding the “Indication of Prepackaged food”).  Parenthetically, it bears note that nonetheless, in 1998 the declaration concerning the official status of some of the sections, including s. 105, was cancelled, and today they have the status of recommendations only (see Notification of Expired Validity of Standards (Food Standards) as Official Standards, O.G. 4649, 5759, 334, 336). Tnuva argues this issue is also of substantive significance for purposes of this proceeding too, and this claim will be discussed below. 

27.  As mentioned, Tnuva no longer disputes the fact that its acts are tainted by having been misleading within the meaning of the Consumer Protection Law and by its violation of the disclosure duties imposed on it by force of that Law. Nonetheless, Tnuva maintains that the Lower Court erred in ruling that it must compensate the group members for the non-pecuniary damage allegedly caused to them under the circumstances. The thrust of Tnuva’s claims as dwelt upon above, is that the act of misleading did not cause any real and compensable damage to any of the group members , and that even if thy incurred real damage,  the causal connection between the alleged damage and the act of misleading was not proved. At all events, Tnuva further added that the Court erred in holding that compensation must also be awarded under the head of infringement of autonomy to group members in respect of whom it was not proved that they had experienced negative feelings due to their consumption of milk containing silicon.

Misleading a Consumer as a Wrong in Tort in  the Representative Context

28.  The legal field in which the consequences of the Tnuva’s actions must be examined in this case is the field of Tort, referred to by s.31 (a) of the Consumer Protection Law, which instructs us that:

“Any act or omission in contravention of Chapters Two, Three or Four shall be treated as a civil wrong under the Civil Wrongs Ordinance (New Version)”

Our concern is with a consumer tort rooted in the Consumer Protection Law, but the body and head of which are formulated in accordance with the basic principles and doctrines of Tort Law.  In other words, to merit a pecuniary remedy based on a consumer tort the plaintiff must prove damage and demonstrate the causal connection between his tortuous conduct and the alleged damage. This applies both to an individual suit relying on a Consumer Protection Law and to a class action relying on that kind of tort (see comments of Justice (former title) M. Cheshin in Barazani Further Hearing [3]. Still, it bears note that to the extent that our concern is with a class action, the court’s application of Tort Law must also be based on the specific principles and rules drawn from the specific field of class actions, which occasionally pose practical problems relating to the location of the members of the group and awarding compensation to each one of them, as well as difficulties in proving the causal connection and proving the damage caused to each one of the group members. There may also be cases in which had a single plaintiff filed a monetary suit by reason of a consumer tort his suit would have been rejected by reason of the negligibility of the remedy – being in the category of des minimis, which does not justify compensation under the general law of Tort (see s. 4 of the Tort Ordinance). On the other hand, when concerned with a consumer tort committed against an entire group of consumers and not just against the single plaintiff, the court will be required to take a different perspective of the remedy requested in the name of the group in the framework of the class action. In such a case the court will be required to examine the class action and the requested remedy taking into account the underlying principles of this specific proceeding, which is intended inter alia to provide a solution to sub-enforcement in cases in which the individual claim would be considered as a negligible claim. When hearing a class action the court cannot limit itself to examination of the remedy in accordance with the regular laws of Tort that would be applicable to an individual suit, and its decision must incorporate the principles and rules drawn from the specific field of class actions.

The need to combine the general laws of Tort with the principles and rules drawn from the laws of class actions, inter alia by relaxing the requirements pertaining to the proof of the damage caused to the members of the group, was dealt with by Justice M. Cheshin (former title) in Barazani Further Hearing [3]  (ibid,  423 – 425). Today, with the enactment of the Class Actions Law, the legislature has equipped us with a detailed statutory arrangement that consolidates the principles and the rules to be applied to the various kinds of class actions and provides a solution to the typical difficulties, some of which we dwelt upon above, and which may arise in this particular proceeding. For example, s. 20 of the Law, to which we will return below, relates to “proof of entitlement to a remedy and payment of financial compensation” and prescribes the specific arrangements for the award of remedies in class actions. The unique nature of the class action proceeding and the need for awareness thereof in the application of principles of the general law of Tort to such an action were addressed by Deputy President E. Rivlin in CA 10262/05 Aviv Legal Services Ltd v. Hapoalim Bank, Head Management [15] where he stated that:

It cannot be denied that that in certain cases the collective-representative character of the proceeding may affect the manner of examining the causal connection, just as it has implications for other elements. The subject of the causal connection in class action suites was discussed at length in Barazani Further Hearing [3]. The majority view as penned by Justice Cheshin dwelt on the basic need for fulfillment of the elements of a personal claim as a condition for the certification of the representative proceeding, specifically the  foundation of the causal connection required for certain grounds of claim. The court noted that the representative context may influence the interpretation of the foundation of the personal grounds, but noted that this possibility was limited and qualified. Conceivably and without making a definite determination on the matter at this time, the Class Actions Law may extend this possibility in view of its emphasis on the collective aspect and its relaxation of the conditions required to be fulfilled for the collective action, all with the purpose of realizing the objectives of the class action…  A strict and case specific interpretation of the foundation of the causal connection would thus be liable to seal the fate on numerous class actions, contrary to the objective of the Class Actions Law. According to another approach, in suitable cases there would be an examination of the causal connection from the perspective of a “meta-plaintiff” who reflects the shared interest of all of the potential plaintiffs, and takes the cumulative damage into account.  Such an examination of the causal connection could fulfill the requirement of the causal connection even in cases where it would not have existed in accordance with the individual case based examination.

   De Minimis

29.  The representative plaintiffs claimed that the group members should be compensated for the non-pecuniary damage caused to them under the circumstances, under two heads of damage: One of them is the infringement of the personal autonomy of the group members and the other for the negative feelings that they experienced upon being informed that they had drunk milk containing silicon.

Upon certifying Raabi’s claim as a collective suit this Court, per Justice M. Naor, in the decision on the certification application, ruled that:

 “The damage claimed by Raabi consists of non-pecuniary damage; negative feelings and feelings of repulsion. The non-pecuniary damage claimed by the plaintiff is the feeling of repulsion stemming from the fact that the case concerns silicon, with all of its negative associations. In my view, damage of this kind is prima facie compensable damage. The act of misleading regarding the contents of the milk in this case is prima facie an infringement of individual autonomy” (p. 681- 682 of the decision).

In that decision, this Court further noted that the infringement of individual autonomy had already been recognized in Tort Law as a compensable head of damage, referring to the decision in Daaka [4].  In its discussion of the class action that was certified as stated, the Lower Court deemed that in the circumstances of our case the group members suffered non-pecuniary damage and in this context dismissed Tnuva’s claim that the failure to specify all of the product’s ingredients did not gave rise to an infringement of autonomy and did not justify the alleged negative feelings. This is Tnuva’s argument before us.

Indeed, a defect in the indication of a food product’s ingredients will not always warrant compensation for infringement of autonomy and negative feelings, and there may certainly be cases in which notwithstanding the existence of a particular defect in reporting the contents of a product, compensation will not be justified.  Justice Naor dwelt on this point in the decision on the certification of the application, noting that:

The insertion of a silicon supplement in the milk, in defiance of the standard constitutes an infringement of individual autonomy, but my comments should not be taken to mean that any case of a deviation from a provision of a standard or of inaccurately reporting its contents will justify a suit. There may be quite a few cases in which a slight deviation from the provisions of any particular standard, even where it concerns food, will not justify a personal suit and by extension a class action. A suit will not be justified where the infringement is de minimis ….  (p, 684).

I concur with Justice Naor’s comments, but they are of no avail to Tnuva in this case, for as noted by the Lower Court, the harm in this case is not in the category of de mimimis from the collective-representative aspect.  

30.  In support of its claims in this matter Tnuva presented the expert opinion of Prof. Hernik who evaluated “from the perspective of a researcher of consumer behavior (the marketing person) whether and if so to what extent, there was an infringement of what is referred to as the consumers' 'autonomy of will'". In his expert opinion, Prof. Hernik acknowledged that in principle and conceptually there was an infringement of the autonomy of will in any case in which the list of contents does not actually conform to the ingredients of the product, except that in order to assess the degree of harm one must evaluate the influence of the misleading act on the consumer’s ability to choose. Prof. Hernik determined that according to his approach, the harm to infringement of autonomy caused to the consumers in this case was negligible and that the misleading media publications had generated a public storm, and lead to an 'imaginary infringement'  of autonomy of the consumers' will.” Tnuva also presented the expert opinion of Prof. Michael Perry who reached a similar conclusion and noted that in accordance with the criterion he had established for examining whether substantive harm had been caused to the autonomy of the consumer’s will, the harm in this case did not exceed a harm that was “trifling” and did not justify compensation.

I do not accept this approach and as I mentioned above, my view is that the Lower Court was correct in its dismissal of Tnuva’s claim that the harm was “trifling” and “negligible” and not deserving of compensation.

The concept of “de minimis” is one that does not admit of advance demarcation and in another context it has already been ruled that:

The question is how to measure harm and when to consider harm as being minimal, The answer depends on the nature of the right that was violated, the purpose of the infringement and additional circumstances of each particular case, and in accordance with which it may vary from case to case (see citation in CA 3901/96 Local Planning and Building Committee v. Horowitz [16]

In the case at hand Tnuva added silicon to low fat long lasting milk to overcome the problem of over frothing  and it chose this solution to save the cost of replacing a machine that was broken. In doing so Tnuva contravened the official standard then in force, according to which it was prohibited to add supplements to the milk that were not specified in that standard. Furthermore, Tnuva failed to indicate on the packaging that the milk contained silicon and the Lower Court established a factual finding that the silicon added to the milk was purchased by Tnuva as a cleaning material from the Amgal company (paras. 35 and 144 (b) of the decision ). In its appeal Tnuva challenges this factual finding but I have not found grounds for interfering with it, and given that this finding remains intact it supports the conclusion that in the first place Tnuva sought to conceal the fact that it had added silicon to the milk.  A similar conclusion also emerges from Tnuva’s conduct after the exposure of the case, when it denied having added silicon to the milk. Tnuva’s problematic conduct as described supports the presumption that the omission of silicon from the list of the ingredients specified on the relevant package was not incidental and that its purpose was to  blind the consumers to the fact that the milk it produced and marketed included this ingredient, in the knowledge that this was a substantive matter that was likely to influence the consumers’ decision whether to purchase the milk.

This was therefore a conscious and illegitimate act of misleading by the intentional concealing of information with all of its attendant severity in terms of the relations between Tnuva as a dealer and the relevant consumer group. Furthermore, silicon is an artificial chemical substance which has absolutely no nutritional value and should not be found  in milk. Accordingly, the reasonable consumer does not expect to find it in milk. Tnuva’s effort in its summations to present the silicon, post facto as a popular “food supplement” in food products lacks sufficient anchorage in the evidence and cannot be accepted,  especially given that it emerged that the Tnuva’s sole reason for adding the silicon was its desire to resolve the problem of frothing for a low cost.  Likewise, no substantive significance can be given to the fact that the standard for cows milk for drinking was officially cancelled already back in 1998. Tnuva repeatedly stresses this fact in its summations and attempts to derive therefrom that adding supplements to the milk, including the addition of silicon, is not a negative act  However, it would seem undisputed that even after the cancellation of the aforementioned standard as a binding standard, silicon did not become a supplement for milk with any of its producers, including Tnuva.   We may therefore continue on the assumption that even in the absence of a binding standard, this was a substance that the reasonable consumer would not expect to be added to the milk that he consumed.  

31.  Another claim stressed in Tnuva’s summations is that silicon is not likely to cause damage to health.  Regarding this matter Tnuva relies inter alia on the conclusion of the Danon committee and the findings of the Magistrates Court in the criminal proceeding, as well as on the expert opinion of Dr. Aharon Eizenberg and Prof. Nissim Garti,  submitted on its behalf. In the absence of damage to health Tnuva contends that no damage was caused to the milk consumers that we are concerned with and that at the most this is a trifling matter that does not warrant compensation. Indeed, the representative plaintiffs did not present an expert opinion on their behalf to prove the allegation hat silicon is injurious to health and neither did the District Court rule on this matter, writing that:  

Indeed, it has not been proved that drinking milk containing silicon caused or is liable to cause immediate harm to the health of consumers. However, in the view of Health Ministry experts, also representing the position of the Ministry of Health as presented by the Attorney General in the appeal against the decision to certify the suit, it is not possible to rule out the existence of a health hazard in the long run, primarily to children, in the wake of drinking milk that contains silicon in view of the fear of consumption in excess of the acceptable daily intake (ADI)…

In the framework of this proceeding there is no cause for ruling on the scientific question of the degree to which the drinking of milk containing silicon poses a health risk. For purposes of this claim it suffices that the existence of such danger cannot be ruled out, at least according to some of the experts. From the plaintiffs’ perspective, it suffices that it was proved that Tnuva’s consumers were entitled to know, upon deciding to purchase milk that it had produced, that it contained silicon in defiance of the law and the standard and that under certain circumstances one cannot rule out the risk to health posed by its consumption” (para. 35, emphasis added).

In this ruling, the Court relied largely on the position of the Attorney General that was submitted to this Court in the framework of an appeal against the decision concerning the certification of the suit as a class action, which it stated that:

In an examination conducted by the National Food Authority of the Ministry of Health, it was not found that this substance is harmful to health, but the fact that there was a determination of ADI [acceptable daily intake) indicates that in excess of ADI there is no certainty concerning its safety in terms of health and the existence of a long term risk cannot be ruled out.  Given that in Israel large quantities of milk are consumed (not necessarily long lasting milk) primarily by children, then with respect to the consumption of milk containing silicon the consumption may exceed the ADI level.  The position of the Ministry of Health is therefore that it lacks information indicating that silicon is harmful to health, but it cannot rule out the existence of a long term risk, in cases involving the consumption of large quantities [para.3, emphasis added]

In addition,  regarding this matter it would not be superfluous to refer to the Danon Report which Tnuva seeks to rely upon.  The Danon Commission did indeed conclude that experience shows that silicon is not harmful to health, does not cause birth defects and that there is no scientific proof of it being carcinogenous (p. 55 of the Danon Commission Report). All the same, the Commission took into consideration the fact that Tnuva had added silicon to the milk “to a degree that exceeded what was permitted according to the manufacturer’s instructions, without examining and considering the effects of its heating and the attendant dangers. The Report further mentioned that “attempts were made in the dairy to reach a dosage that would be suffice for the required blocking of the froth, but without consulting with any entity in the Ministry of Health or any other licensing authority”, and that the silicon was added to the milk in a quantity and dosage that exceeded the level approved for foods other than drinking milk that this fact “necessitates an additional investigation of matters relating to the ordering of the material and the use thereof (p. 14-15 of the Danon Commission Report).

Accordingly it is difficult to accept Tnuva’s claim that there are unequivocal conclusions regarding the influence of the silicon added to the milk with respect to its influence on the consumers’ health, and this is sufficient grounds for not interfering with the Lower Court ‘s conclusion that under certain circumstances one cannot rule out the possible health risk involved in the consumption of milk containing silicon. Similarly, I also accept the Lower Court’s position that at all events every person has the right to choose whether he wishes to expose himself and his family to the material the nature of which is unknown to him. Hence, the fact that it was not positively proved that silicon is actually liable to harm consumers’ health has implications for the intensity of the infringement of autonomy (see Daaka  [4 ], p. 583; Nili Karako-Ayal, “Estimation of Compensation Due to Damage from Infringement of the Right to Autonomy”  - in the wake of CA 2781/93 Ali Daka v. Carmel Hospital, Hamishpat, 11,  267, 270-271 (5767) (hereinafter – Karako-Ayal)), but not on its infringement per se as a result of the fact that the consumer introduced a chemical substance into his body, the essence and character of which were unknown to him without having had the opportunity of deciding whether he wanted it (see s.1 of the Attorney General’s response to Tnuva’s application to submit additional evidence in the framework of the hearing on the application for certification in this Court. Regarding the significance of the health risk in class action proceedings in the case law of the District Court, see also CF 2593/05 (Tel-Aviv Jaffa) Solomon v. Guri Import and Distribution Ltd, para. 44 [   ] ; CF 1624/07 (Capp 8767/07)(Tel-Aviv Jaffa) Hova v. Milko Industries Ltd  [   ](27.1.2020); CF. 1126/07 (CApp 3058/07) (Tel-Aviv Jaffa) Arges v. Tnuva Central Cooperative for Marketing of Agricultural Products in Israel Ltd, para. 16 [   ] ; CF 1545/08  Alfasi v. Super Pharm Israel Ltd  [     ] and CF 1424/09 ((Tel-Aviv Jaffa) Guttman v. Neviot – Teva Hagalil Ltd.

In view of all the above, there is grounds for the Lower Court’s determination that under these circumstances there was an infringement of the consumer’s autonomy to decide whether or not he desired to consume  milk containing silicon and prima facie this is not a “trifling” infringement falling into the category of de minimis,  not warranting compensation.

32.  This conclusion gains added force inasmuch as our concern is with a class action in which it was proved that Tnuva’s act of misleading harmed the broad consumer public and the Lower Court  rightly ruled that under these circumstances the severity of the harm must be examined from the perspective of the entire group and “not from the perspective of an isolated consumer”. Indeed, I already mentioned the approach whereby the de minimis  rule does not apply, in the simple sense, to the foundation of damage in a typical class action,  insofar as “its central feature is the accumulation of insignificant instances of damage, which when considered individually would not have materialized into a legal proceeding; this approach has established itself in the case law of this court (see Aviv Legal Services Ltd [15], para. 10; also see comments of Justice Mazza in Barazani Further Hearing [3], 447). All the same, it should be emphasized that the fact that a large group of plaintiffs in a class actions alleges an accumulation of minor damages, does not necessarily negate the possibility that the matter is de minimis  from the group perspective as well. As noted, the precise borders of this concept do not admit of determination in advance and in a class action proceeding the answer to the question of whether the damage is of a minimal nature that does not warrant compensation depends on the circumstances of each case and may change having consideration for the particular circumstances of each case.

At all events, in the case before us, given the existence of a large group that  alleges damage as a result of Tnuva’s actions, the severity of which from a consumer perspective has already been discussed, precludes the conclusion that the matter is de minimus, even in the context of a class action. This is the case even though one cannot rule out the possibility that the existing discrepancy between the members of the group in terms of the intensity and scope of the injury may lead to the conclusion that had each member of the group filed a  personal claim the remedy claimed by each one of them separately would be de minimis.  Another question  concerns the number of group members who are entitled to compensation for this injury and what is the rate and the model of compensation for purposes of ruling in our case. When considering the number of the members of the group entitled to compensation attention should also be given to the issue of splitting up the compensation for non-pecuniary damage in the current case.  The reason for this is that the Lower Court held that compensation should be awarded for the Tort head of infringement of autonomy and separately for the tort head of negative feelings.  It will be recalled that in this context the Lower Court accepted the position of the representative plaintiffs and in reliance on the consumer survey that was presented to it (adjusting its results downwards), and ruled that: "a uniform rate should be ruled for the infringement of individual autonomy, whereas with respect to about half of the members of the group it will be supplemented by damage by reason of negative feelings" (para. 84 of decision).  Nonetheless, it bears note that ultimately the Lower Court ordered the payment of overall compensation (NIS 55 million), stating that this sum "reflects the personal damage that is estimated for each individual of the group, of the sum of NIS 250 (para. 134 of decision), and without actually distinguishing between the heads of damage that were mentioned and without differentiating between the members of the group in its entirety whom it had determined were entitled to compensation for the infringement of autonomy and half of the members of the group, who were additionally entitled to compensation for negative feelings. Accordingly in their appeal the representative plaintiffs challenge this ruling, and we must therefore address the fundamental issue of the splitting up of the non-pecuniary compensation, as mentioned.

However, prior to addressing the subject of the scope of the compensation  awarded we must first address the essence of the central damages head  which was at the forefront of this class action.

 Infringement of Autonomy

       33.  In the Daaka  [4] case, Israeli law recognized for the first time that the non-pecuniary damage involving the infringement of autonomy is "damage" in the sense of the Torts Ordinance, and that as such is compensable (on compensation for non-pecuniary damage in Tort Law in general, see s. 76 of the Torts Law. Also see CA 4576/08 Ben-Zvi v. Prof. His  [17] (hereinafter: Ben Zvi); Eliezer Rivlin " Compensation for Non Pecuniary Damage –Broadening Tendencies" -  Shamgar Volume,  Part 3, 21, 45 (2003); Yifaat Biton Dignity Aches: Compensating Constitutional Harms, 9 MISHPAT UMIMSHAL (Haifa University LR) 137 (2005) (hereinafter: Biton).   In the Daaka [4] case the court held that the  fundamental right to autonomy means the right of every person "to decide his or her deeds and wishes in accordance with his or her choices, and to act in accordance with those choices". It ruled that this right encompasses all of the central aspects of a person's life, from which it may be derived inter alia that "every person has freedom from unsolicited non-consensual interference with his of her body". It further held that this freedom is one of the expressions of the right to dignity given to every person, and is anchored in Basic Law: Human Dignity and Freedom.

These rationales, which in Daaka [4] lead to the recognition, protection and compensation for an infringement of autonomy of the body, are relevant and applicable to cases in which there is an infringement of the victim's autonomy in central aspects of his life due to the denial of his freedom to choose and the breach of the duty of disclosure to him. For example, the court recently recognized the damages head of infringement of autonomy in a case in which the autonomy violated was that of the family relatives of the deceased person, and pertained to the manner of treating his body (see in Ben- Zvi [17]. Hence, contrary to Tnuva's claim, the recognition of the damages head of infringement of autonomy is not, and should not be limited to cases of medical negligence or exclusively to autonomy of the body. The principles underlying the recognition of this head of damages and the constitutional right protected by such recognition, in appropriate cases, will justify compensation for infringement of autonomy even where other torts are concerned, such as the consumer tort in our case (see Tzachi Keren-Paz "Compensation for Violation of Autonomy: Normative Evaluation, Developments and Future Trends" Hamishpat 11, 187, 192-194 and the examples cited in the footnotes) (2007) (hereinafter – Keren-Paz); Dafna Barak – Erez, "Constitutional Torts in the Era of Basic Rights" Mishpat UMimshal 9, 103, 121-122, 129 (2006)).  In her in her decision to certify Raabi's suit as a class action, Justice Naor was guided by the approach that rejects the limitation of the boundaries of the damages head of non-pecuniary damages for infringement of autonomy to Tort of negligence in general and specifically medical negligence.  Her approach was rightly adopted by the Lower Court when it awarded compensation for the damages head of infringement of autonomy, having found that by its actions Tnuva had committed an act of misleading against Raabi and against the group of consumers that he represented, by failing to disclose the existence of silicon on the packaging of the milk that it produced and marketed.

34.  It is important to note that in the Daaka [4] case the infringement of autonomy was classified as a head of non-pecuniary damage in the framework of the tort of negligence, and not as a separate tort in its own right. Following the decision in Daaka [4] the view was expressed that it was appropriate to recognize the infringement of autonomy as a constitutional tort that gives rise to an independent grounds of claim (on this, see the comments of the Deputy President in CA 8126/07 Estate of the Late Bruria Zvi  v. Bikkur Holim Hospital [18]; Ben-Zvi [17] in para. 54 of his decision and in the same vein, the opinion of Justice Amit, in Ben Zvi  para. 21.  Also see Rivlin, 45 and see and compare to Keran Paz;  Nili Krako Ayaal "The 'Informed Consent' Doctrine – An appropriate Ground of Claim where the Patient's Right to Autonomy was Violated" Hapraklit 49, 181, 222-223 (2006)). However, our case law  has yet to give deep consideration to this weighty issue of recognizing a new tort created by case-law and the case at hand does not require  a discussion and decision on the matter. The reason is that the representative plaintiffs in this case took the path of settled case -law, and classified the infringement of autonomy as a  non-pecuniary head of damage in the framework of the tort of misleading which it attributed to Tnuva in accordance with the Consumer Protection Law. Inasmuch as the representative plaintiffs did not claim in the Lower Court or before us that in this context the plaintiff's  right to compensation for infringement of autonomy should be recognized as a  (sic)right ,should be recognized as an independent tort based on the violation of a constitutional right entitling the plaintiff the issue can be left pending further examination and there is not cause for us to address the matter on refer to it on our own initiative.

The Requirement of a Causal Connection

35.  Tnuva further added that the Lower Court erred by deviating from the law set forth in FHC Barzani [3 ] dwelt on above, and had actually waived the requirement for a causal connection between the act of misleading and the damage. Tnuva claimed that the representative plaintiffs failed to prove that their decision would have been influenced by having been informed in advance.  Since the grounds of misleading, by definition, requires that the consumer rely upon the dealer’s conduct, then absent proof of such reliance, according to Tnuva, there are no grounds for an act of misleading under the Consumer Protection Law.

On the other hand, the representative plaintiffs claim that to the extent that the concern is with the head of damage in the form of infringement of autonomy, then it will be regarded as having been proved, even if the victim would have acted in the same manner had he been presented with all of the information, and that at all events, in the case at hand it had positively been proved that the consumers would not the purchased milk containing silicon.

36.  Indeed, in the Further Hearing Barazani [3] and we already addressed this point above, the court ruled that the requirement for a causal connection in s. 64 of the Tort Ordinance also applies to consumer torts pertaining to misleading advertising, and even where the tort is grounds for a class action. All the same, the court also ruled that to the extent that the matter concerns consumer torts, the requirement of reliance deriving from the requirement for a causal connection will be interpreted broadly so as not to include to direct reliance only” but also “an indirect causal connection by way of a reasonable chain of causes from the publication and until the consumer” (ibid.,  414- 415). In Barazani [2] it was further ruled that in a class action proceeding based on the provisions of Chapter F’1 of the Consumer Protection Law and its relevant regulations enacted by force thereof  (provisions that as stated were cancelled in the interim in the Class Actions Law) it may be necessary to relax the stringency in proving the causal connection having consideration for the nature of this unique proceeding, and the fact that “the court is entitled to prescribe appropriate methods of proof at its own discretion for the causal connection between the misleading publication and the damage caused to each one of the members of the group, including the damage that was caused to each and every one of them (ibid.,  424). In that matter there was no proof at all of a causal connection, not even indirect, as claimed by Barazani, given that Barazani was not actually exposed to the publication. For this reason the court dismissed Barazani’s application to approve his personal claim as a class action and ruled that his personal suit does not show any grounds.

Tnuva’s attempt to rely on the Barazani ruling and to claim that in this case too it was not proved that there was a causal connection between its conduct and the non-pecuniary damage being claimed, cannot stand, for a number of reasons:

First, the claim was raised by Tnuva at the stage following the certification of the class action and to the extent that it is directed against the group as such, it must be remembered that three years after the decision in the  Further Hearing Barazani  [3], the Class Actions Law was passed, unifying all of the principles and rules to be applied to the various categories of class actions. The Law consists of a comprehensive, detailed statutory arrangement, including the methods of proving entitlement to the remedy being claimed, and inter alia it enables the granting of remedies for the public good in appropriate cases where it is not practical to prove the damage caused to each member of the group and  a fortiori the causal connection between the damage and the tortfeasor’s conduct (s. 20 (c ) of the Law). As specified below, this outline was adopted by the Lower Court and under these circumstances the demand to prove the causal connection between Tnuva’s conduct and the damage in respect of each individual of the group is problematic.

Second, the decision in Barazani [3] concerned misleading by action due to the misleading advertisement of Bezeq concerning the tariffs per conversation, and as mentioned it was held that insofar as Barazani was not even exposed to the misleading advertisement, there was no causal connection between the publication and his alleged damage.  Our case on the other hand concerned misleading by omission committed by Tnuva in its failure to disclose the fact of the silicon being added to the milk. Tnuva claims that the plaintiffs must prove that had they been exposed to that fact in a timely manner they would not have purchased the milk. It would seem that a requirement of a plaintiff to prove that had he been aware of the fact he would have acted otherwise would be particularly difficult to prove and in many cases even impossible. Indeed, this position is reinforced to the extent that our concern is with a class action. On the difference between misleading by an act and misleading by omission with respect to proving a causal connection in the representative context, see our comments in CA 9590/05 Rahman Nuni v. Bank Leumi LeIsrael Ltd [19] which overturned the District Court’s decision to dismiss the application for certification of a class action because of the plaintiff’s failure to prove the causal connection. In our judgment in the appeal we reversed this decision and ordered that the file be remanded to the lower court, indicating that “it seems that the question of the requirement of the causal connection in this case is also worthy one further consideration. This matter involves complex questions, the first of which is whether to apply the rule set by this Court for purposes of the ground of misleading, in FHC 5712 Barazanai  [3] even where it concerns the grounds of “non-disclosure” (ibid., para. 6) (regarding the similar approach taken in American Law in various contexts, see: Affiliated Ute Citizens of Utah v. United States 406 U.S. 128, 153-154 (1972) [34]; Binder v. Gillespie 184 F.3d 1059, 1063-1064 (9th Cir. 1999) [35]; Poulos v. Caesars World Inc. 379 F.3d 654, 666 (9th Cir. 2004) [36 ]. See also, CF (Tel-Aviv-Jaffa) 2405/04 Ben Ami v. Hadar Ltd [  ] paras. 72- 73 (14.2.2010).

We may thus conclude that to the extent that the consumer tort on which the class action is based on is misleading by way of omission, (by way non-disclosure) this may justify leniency regarding the proof of the causal connection between the wrongful conduct and the alleged damage.

Third, as opposed to the Barazani case [2], which was a monetary claim (tariff differentials), the head of damage being sued for in this case pertains to non-pecuniary damage  in the form of infringement of autonomy. Regarding this head of damage it was ruled that there was no need to prove a causal connection between the failure to disclose relevant information and the choice made by the victim (see: Daaka [4], 567-570; CA 6153/97 Shtendal v. Prof. Yaakov Sadeh [20], at p. 760; CA 9936/07 Ben David v. Dr. Entebbe [21] para 11 of Justice Hendel’s decision; CA 9817/02 Weinstein v. Dr. Bergman,[22]  para. 18). For a critique of the Daaka [4] decision, see Assaf Yaakov “Informed Consent and Duty to Disclose, Tel-Aviv University Law Review  31, 609 (2009). The rationales in this context that guided the court in Daaka [4] and in other matters pertaining to medical negligence are applicable to the same degree with respect to an infringement of autonomy caused as a result of the consumer tort committed by a dealer who misled a consumer.  Indeed, the non-disclosure per se involves the denial of the consumer’s freedom of choice. In our case, by failing to specify silicon as one of the components of the product, Tnuva deprived the consumers of the possibility of making an intelligent choice and deciding whether they wish to purchase and consume it. This suffices as proof of an infringement of autonomy. Another question is whether this suffices to establish a right to compensation or whether it must further be shown that consequential damage was also caused to the plaintiff, finding expression in negative feelings given the denial of his freedom of choice. I will address this point further on. 

37.  At all events, even had we ruled that the circumstances of this case necessitated bringing proof that the members of the group would not have purchased the milk had they known that it contained silicon, this requirement for a causal connection in a class action  might conceivably have been satisfied by a determination in the manner of a "collective causal connection" (on this see Aviv Legal Services [15]para. 10). This kind of collective causal connection may be substantiated by the assumption that the group members, and at least the majority thereof, would have replied in the negative had they been asked in advance whether they would purchase milk to which Tnuva had added an artificial  supplement the  nature of which they were ignorant, and in defiance of the standard,  in order to overcome the problem of excessive frothing (compare C.F. 1036/66 (Capp. 1877/06) (Tel-Aviv Jaffa) Tal v. Rabin Medical Center (Beilinson Campus), para. 12) [  ] See also regarding the use of "generalized evidence" in American Law: Kennedy v. Jackson National Life Insurance Company, 2010 U.S. Dist. Lexis 63604, 25-28 (N.D.Cal 2010) [37];   Negrete v. Allianz Life Insurance Company of North America 238 F.R.D 482, 491-492 (C.D. Cal. 2006)[38]; Klay v. Humana, Inc.382 F.3d 1241, 1259 (11th Cir. 2004) [39]. Regarding the exception to the application of the doctrine in cases in which extensive differentiation between the members of the group was proved, see Poulos v. Caesars World, Inc. [36]. Further support for the application of this doctrine in the circumstance of the case before us can be adduced from the fact that it was Tnuva's intentional actions that created the situation which encumbered the process of locating the members of the group and the conduct of an individual examination of each of the elements that must generally be proved in the according to the law of tort.  Additional support for the existence of a causal connection between the act of misleading committed by Tnuva and the consumers' choice to consume the milk, can be fond in the trends evidenced in the consumers survey that was presented, and which we will address further on.

   38.  Tnuva further adds that at all events, the publications in the press concerning the damage to health caused by silicon consumption severed  the causal connection between its own acts and the bad feelings experienced by consumers, which it claims were  by and large the result of publications that post facto turned out to be unfounded.  This claim regarding the causal connection is not grounded in evidence, and in this matter as the one whose act of mass misleading caused uncertainty regarding the precise influence of the publications on the feelings of the consumers, it is Tnuva that bears the onus of proving the opposite (compare: Johnson v. The Goodyear Tire & Rubber Company, Synthetic Rubber Plant, 491 F.2d 1364, 1379-1380 (5th Cir. 1974)[40]; Cooper v. Allen, 467 F.2d 836, 840 (5th Cir. 1972) [41]. Accordingly, this argument is rejected.

Assessment of the Compensation for the Infringement of Autonomy – The Objective Approach and the Splitting Up of the Compensation for Non-Pecuniary Damage.

39.  How does one assess the compensation for the tort head of infringement of the right to autonomy?

Based on the constitutional features of the right to autonomy some favor the objectification of the assessment of the compensation for its infringement. For example, Dr. Tzahi Keren-Paz argues that "freedom of choice can be viewed ….as an asset with objective value" and hence "it is appropriate to award a sum that reflects the social value attaching to the denial of freedom of choice. This sum should even be awarded absent proof of consequential, subjective damage (feelings of shock and anger) by reason of the denial of freedom of choice" (Keren-Paz, 196-198). Keren-Paz sees special justification  for an objective assessment of compensation for infringement of autonomy in the consumer context. In his view, "the deterrent consideration (that focuses on the dealers) must also justify the compensation award in circumstances in which the compensatory factor (that focuses on the legitimate damaged interest of the consumer) does not provide sufficiently strong support for the compensation due to the problem of under-deterrence of the dealers…"(Keren-Paz, 242).  The scholar Dr.Nili Karko-Ayal likewise suggests that compensation should be assessed  in accordance with the value of the right to autonomy on the one hand, and the gravity of its infringement, on the other hand (see Karko-Ayal and see the opinion of Judge Strasbourg-Cohen in the Daaka case [4], at p. 619).

This approach deviates from the traditional principles of the laws of tort, that are based on a subjective, individual assessment of amount of compensation, and from the conception of compensation as being intended to restore the victim's position to the status quo ante and to provide him a remedy for the damage caused to him, including non-pecuniary damage. This point was mentioned by Justice Or in the Daaka case [4 ] when he awarded compensation for a  victim under the tort head of infringement of autonomy, where he said:

Naturally, matters relating to the proof and the extent of damage are determined in accordance with the particular data in each individual case and the evidence submitted in court. The substantive criterion for generally determining the amount of compensation to which the victim is entitled is the criterion of restoring the situation to its original [ex ante – ed.] state. This criterion is an individual one. It requires an individual assessment of the gravity of the harm caused to the specific victim (p. 582-583)

The difficulty involved in application of a "pure" objective criterion for purposes of determining the sum of the compensation for an infringement of autonomy was likewise addressed by scholar Prof. Dafna Barak-Erez in her discussion of claims filed by the individual against an authority, where  she emphasized that in this context as well:

…the principles of tort should not be deviated from  by awarding compensation that is detached from the concrete infringement and its circumstances. The sum of the damages cannot and need not reflect the universal value of the right… compensation that purports to reflect the general value of the right should be rejected  for a number of reasons. First it is illegitimate from a principle-value based perspective, because it purports to attach a price tag to the right itself. Second, it benefits the plaintiff in a manner that extends beyond his own particular damage, and thus deviates from the principle of restoring the status quo ante. In the realm of Tort law, compensation is determined in accordance with the damage to the victim himself, and not in accordance with the value of his right from the perspective of the other person (Dafna Barak-Erez, Constitutional Torts 277 (1993) (hereinafter – Barak-Erez)).

It is not superfluous to mention that in academic writing in the field of tort one can discern trends that deviate from the traditional perception whereby Tort law is intended to grant remedial damages to the specific victim in order to restore the status quo ante. Hence for example, there are some who contend that punitive damages that are not derived from the victim's damage may in appropriate cases provide a solution to sub-enforcement and therefore constitute an efficient form of deference A. Mitchell Polinsky & Steven Shavell, Punitive Damages: An Economic Analysis, 111 Harv. L. Rev. 869 (1998), as well as to heal societal damages caused by the tortfeasor to the victims who did not come to court  (Catherine M. Sharkey,Punitive Damages as Societal Damages, 113 Yale L. J. 347 (2003). Deputy President, E. Rivlin recently addressed this matter in the matter of Ben Zvi  [17] in  where he treated the matter of punitive damages, noting that today, the case law in Israel too has recognized the court's authority to award damages of this kind in the framework of the law of tort, and he also mentions that :"despite the sharp analytical distinction between punitive damages and remedial damages, on a practical level the contradiction is not so sharp, at least in the realm of non-pecuniary damage"  (paras. 37- 39 of his opinion, see also in LCA 9670/07 Anon v.Anon [23], paras 22-27 or the opinion of Justice E. Rubinstein, and the opinion of the Deputy President E. Rivlin).

However, to the extent that the compensation to be evaluated and awarded is claimed as part of a class action, one must remember the provision of section 20 (e) of the Class Action Law, which provides that: 

In a class action the Court shall not adjudge exemplary compensation and it shall also not adjudge compensation without proof of damage….but the aforesaid shall not prevent the award of compensation for other than monetary damage.

    Thus, the Class Actions Law stymied the possibility of awarding punitive damages in a class action. All the same, the Law established other special compensatory mechanisms that enable realization of the principle of remedial justice, for example, by way of imposing a cy-pres obligation on the tortfeasor for the damage caused, and principles of efficient deterrence, such as obligating the tortfeasor to provide a remedy for the public interest for the widespread social damage that he caused, and I will address this matter below.

40.  I do not accept the objective approach to the evaluation of the sum of damages for infringement of autonomy that I reviewed above. The head of damage of infringement of autonomy is encapsulated in the negation of the victim’s freedom of choice, and in the majority of cases involves the non-disclosure of a matter that is critical for the victim. Accordingly at the very least as far as it concerns class actions, a presumable starting point for evaluation of the non-pecuniary damage caused to those whose autonomy was violated, is that as a result of that infringement they experience anger, frustration and insult (of varying degrees of intensity, according to the concrete circumstances of the case).  These feelings which resulted from the tortfeasor’s conduct, justify compensation for non-pecuniary damage. However, there is no conclusive presumption that these feelings are experienced by the victim in every case of an infringement of autonomy. Accordingly, should the tortfeasor successfully prove that notwithstanding that his conduct negated the freedom of choice of the plaintiff or of the members of a group, they remained indifferent and unmoved, it may be determined that they are not entitled to damages under this head of damage because in truth, despite the denial of their freedom of choice, they did not sustain any non-pecuniary damage as a result. My approach, whereby the compensation for infringement of autonomy is awarded by reason of the subjective consequential damage expressed in feelings of anger, frustration and other similar negative feelings caused by the tortfeasor’s conduct, gives rise to the another conclusion – that there are no grounds for severing the compensation for infringement of autonomy from the compensation for mental anguish and negative feelings caused to the victim by that infringement (as distinct from the non-pecuniary head of damage relating to other infringements in framework of the same claim). A different approach to this matter was expressed by the Lower Court, even though, at the end of the day, as mentioned, the Lower Court awarded a sum total of NIS 250 as non-pecuniary damages for each member of the group without distinguishing between those members of the group who experienced negative feelings and those regarding whom it was proved by the consumers survey did not suffer feelings of this kind (regarding this matter, see the dispute between the Deputy President E. Rivlin and Justice Y. Amit, in the matter of Ben – Zvi [17] (see Keren-Paz, 203-208). 

A conclusion similar to my conclusion on the matter also emerges from the findings of Justice M. Naor in the decision given in the appeal on the decision to approve Raabi's suit as a class action.  In that context Justice Naor relates in the same breach to the non-pecuniary damage caused by the infringement of autonomy and to the negative feelings attendant to that damage. In her own words:

…..[t]he damage claimed by Raabi is non-pecuniary damage, negative feelings and feelings of revulsion. The non-pecuniary damage which he claims is characterized by the feeling of revulsion that stems from the fact that the material concerned is silicon with all of its attendant associations. In my view damage of this kind is compensable damage. The act of misleading concerning the contents of the milk in this case, prima facie, constitutes, an infringement of individual autonomy. Our concern is with a food product.  Consumers are entitled to determine what to ingest into their mouths and bodies and what to avoid. For example, if a person wishes to only eat kosher food and post facto it becomes clear to him that the food that was misleadingly presented to him, was not of that nature, will feel a sense of revulsion and an infringement of his autonomy…  (ibid.  681-682, emphases added).

     Indeed, to the extent that it concerns Raabi  - the representative plaintiff – after hearing his testimony and the testimony of his son, the Lower Court ruled that Raabi had experienced substantial negative feelings upon becoming aware that the milk that he had consumed contained silicon, and that Tnuva had refrained from specifying this component on the packaging; in the words of the Lower Court:

,,,[a]s a result of these acts the plaintiff was denied the ability to make an intelligent and informed choice concerning the purchase of an alternative product, that does not contain  a supplement that it prohibited by law for use in milk for drinking. It is likewise clear that the negative feelings experienced by Raabi stem from the acts of Tnuva. It could be claimed that these feelings were exaggerated, having consideration for the fact that it was not proved that silicon causes a health risk. But one cannot dispute his [Raabi's] feelings as such: [Raabi] subjectively felt a sense of disgust (nausea), anxiety,  as a result of having drunk the milk containing silicon as well as anger and rage by reason of the fraud.  All of these fall into the category of non–pecuniary damage that is neither peripheral nor negligible and is indeed compensable… " (para. 57, emphases added).

     There is no justification for interference with these rulings of the Lower Court, for as stated they are based on the testimonies of  Raabi and his son, and on the Court's direct impression from those testimonies. However, in order to determine the precise compensation to be awarded, if at all, in favor of the group on whose behalf Raabi handled the class suit, proof of subjective damage caused to Raabi will not suffice and additional complex questions must be addressed, relating to proving the entitlement of the members of the group to the pecuniary compensation that was claimed, including, inter alia,  the question concerning the difference between the group members who experienced negative feelings as a result of the denial of their right to chose whether nor not to consume milk containing silicon and the group members who remained indifferent to the aforementioned denial of their free choice.

41.  As mentioned above, under the circumstances, at the time of the handing down of the decision on the class action it was not possible to individually identity each member of the group and to determine the individual right of each one of them to  a remedy. As such it was not possible to rule on the class action in favor of the group in accordance with the evidentiary paths  set forth in section 20(a) of the Class Actions Law. In order to determine the compensation, the Court was required to utilize the framework of s.  20 (c) of the Class Actions Law, which was intended for those cases in which "Court concluded that, under the circumstances, pecuniary compensation for all or some members of the group is not practical, either because they cannot be identified and the payment cannot be made at a reasonable cost, or because of other reason".

Based on the opinion of Prof. Ofir, who was appointed as expert on the Court’s behalf, the Lower Court ruled that during the relevant period 220,000 consumed the long-lasting milk containing silicon.  Basing himself inter alia on the data he received from Tnuva, Prof. Ofir estimated that the number of households that had purchased the milk stood at NIS 166,307, and in his testimony in Court Prof. Ofir noted that the number of adult purchasers during the relevant period stood at 330,000. As such, according to his approach, the number of members in the group ranged from between 166,307 to 330,000 (p. 672 of the protocol). The Court’s determination that in this context one should consider a group number about 220,000 persons is therefore a cautious and conservative estimate (see comments of Prof. Ofir, p. 672 – 674 of the protocol), which will not be interfered with.

What remains to be examined is how many of those belonging to the aforementioned group of milk consumers actually experienced negative feelings as a result of the infringement of their autonomy.

The representative plaintiffs submitted an expert opinion drawn up by Dr. Katz and Prof. Mevorach, based on a consumers survey, from which it emerges that 26% of those questioned, who represent the general population, were indifferent to the publication to the effect that the milk contained silicon. Under the assumption that this percentage, pertaining to the general population, is also likely to reflect the interviewees who did not actually consume the long lasting low-fat milk during the relevant period, it would be appropriate to address the essential findings of the expert opinion that reflect the percentage of consumers of this milk before the publication from out of the total population (43%), and the percentage of consumers from out of these who continued to drink this milk even after the publications concerning the inclusion of silicon therein (30% out of the 40%, which represents 13% of the entire population). The expert opinion of Dr. Mevorach and Dr. Katz indicates that 66% of those who previously consumed long lasting, low fat milk of Tnuva (which they claim represent 28% of the total population) experienced negative feelings  in the wake of that publication, at various levels of intensity, including "revulsion, nausea, anxiety, fear, anger, hatred, disappointment, deceit, lying, fraud, temerity, contempt, irresponsibility, bad feelings (section 3 of the survey), whereas 30% continued to consume the milk even after the publication.

In our case and based on the data presented by the representative plaintiffs, there are grounds to conclude that some of the group members remained indifferent to the addition to the silicon to the milk.  26% of those asked specifically stated that this was their feeling: "indifference, no problem, not correct and other feelings that are not negative"- page 5 of the expert opinion of  Dr. Katz and Dr. Mevorach, subsection (b) of the answers to question 3, and "nothing, unmoved and indifferent" and "they made a mountain out of a molehill" – (the encryption page of the answers to question 3), and in the absence of a datum in the survey conducted regarding how many of those questioned had consumed silicon in the past, I think that the percentage of "indifferent consumers" can be derived from the datum in the expert opinion relating to those who continued to consume long lasting milk even after the publication of the silicon matter (30% of the overall number of consumers in the past, and 13% of the entire population). Accordingly, from out of the overall number of consumers of long lasting low fat milk during the relevant period, the number of whom stood at 220,000 according to the determination of the Lower Court there should be a reduction of  30% of "indifferent consumers" who did not experience negative feelings even after having been informed that the milk that they had consumed contained silicon, and that Tnuva refrained from indicating this element on the packaging.  The scope of the group entitled to compensation for the infringement of autonomy that caused them negative feelings, therefore stands at 154,000 people.

42.  In its pleadings, Tnuva objected on a number of counts to the  Lower Court's willingness to base findings and conclusions on the consumer survey relied upon in the expert opinion of Dr. Katz and Dr. Mevorach. Basing findings concerning subjective feelings on surveys is problematic. Even so, inasmuch as the Lower Court ruled that the structure for proving the pecuniary compensation to be awarded in this case is the one prescribed by s. 20 (c ) of the Class Actions Law in view of the practical impossibility of identifying the group members and in ruling individual compensation, under the circumstances, the reliance on an expert opinion based on a consumers survey gives expression to a degree of leniency regarding the modes of producing evidence which is occasionally required in the context of class actions. The need for such leniency was already addressed by the court in Barazani [3], as mentioned above and is now grounded in explicit legislation in the provision of s. 20 (c ) of the Class Actions Law (on the "enlisting" of statistic data for proof of damage where there is structural vacuum in terms of the possibility of presenting individual data, see and compare: Eliezer Rivlin and Gai Shani "A Rich Conception of the Principle of Restoring the Status Quo Ante in the Doctrine of Compensatory Damages"  ,  (hereinafter: Rivlin and Shani); Gai Shani: "The Principle of 'the Matter Speaks for Itself' in the Law of Torts – Revisited”; A. Porat & A. Stein Tort Liability under Uncertainty 87-92 (2001);  Naturally, the court's reliance on the expert opinion based on the consumers survey is conditional upon the court having found the expert opinion to be worthy of reliance, having considered the entirety of claims raised regarding it.

In the case before us, having examined the survey's findings,  the expert opinion of the Dahaf Institute on Tnuva's  behalf (drawn up by the expert, Dr. Mina Zemach), and the expert opinion of the Court expert who gave his opinion on the survey, the Court held that "The testimony of Professor Mevorach and Prof. Katz made a reliable impression, and  my impression is that they are professionals with experience and knowledge in their field" (para. 60). The Court rejected Tnuva's claim that the survey's results are biased, and that the questions presented to the interviewees included the assumption that silicon causes health hazards. For example, Dr. Mina Zemach on Tnuva's behalf mentioned question three that was presented to the interviewees ( "What did you feel in the wake of the publications  concerning  Tnuva's insertion of silicon into long lasting low fat milk, and its health risks?"). She claimed that the final clause of the question relating to health risks was altogether unnecessary and that there was reasonable grounds to fear that "this biased wording contributed to part of the serious defects of the study" (page 4 of the expert opinion, page 11 of the expert opinion).  Rejecting this assertion, the Court ruled that the presentation to the interviewees was authentic because it was proved that at that time there were publications concerning the health risks of silicon.  All the same, to be on the safe side, the Court was prepared to assume that the survey’s findings that tended to exaggerate the negative feelings somewhat, even if not to the extent of justifying the survey’s disqualification, as claimed by Tnuva, should be taken into account when determining the number of consumers who experienced negative feelings (about half according to the Lower Court’s holding as opposed to 66% according to the survey).  There was no justification for interfering with the conclusion that the wording of question number three did not warrant interference (regarding this, see comments of Prof. Mevorach in his testimony, p. 287 – 291, 296- 298 of the protocol). Furthermore the Court further ruled, correctly, to disqualify the fifth question of the survey, in which the interviewees were asked “Did your negative feelings emerge immediately with the initial publications or after that publications were also verified by the Ministry of Health and by Tnuva. The Court noted that this question contains potentially misleading information because of the possible implication that Tnuva and the  Ministry of Health had verified the publication concerning the health hazard, when in fact this was not the case/

  Accordingly no defect can be found in the Lower Court’s willingness in this case to rely on the expert opinion of Dr. Katz and Prof. Mevorach (that relies on a consumers survey) for purposes of determining the portion of the group that experienced negative feelings as a result of the infringement of their autonomy. By extension  our own reliance on this expert opinion cannot be negated as a means of determining the size of the group, along with the deletion of the “indifferent consumers” as set forth in section 41 above.

The Degree of Damage

     43.  We are required to determine the degree of damage, which in this case means the non-pecuniary damage incurred by consumers as a result of drinking milk containing silicon. Assessing the degree of damage expressed in victim’s negative feelings of anger, frustration and insult, and other like feelings caused by the tortfeasor’s wrongful conduct, and determining the compensation owing to him by reason of such damage, is no easy task. The reason is that damage of this kind is essentially subjective-individual damage, largely dependent upon the personal emotional barometer of each individual. This point was addressed by Justice T. Or in the Daaka [4] case in his ruling on the specific, non-pecuniary damage incurred by the plaintiff  due to the infringement of his autonomy. He wrote the following:  

The damage in this kind of case involves a predominantly subjective aspect, giving rise to inevitable difficulties in assessing it. Ultimately, the sum of compensation in each particular case, similar to compensation for other non-pecuniary damages, is a matter of judicial discretion, and it is thus determined by making an evaluation based on all the relevant circumstances and the impression of the court. The court must therefore adopt a balanced approach. It should give the appropriate weight to the fact that basic human rights were violated, which dictates an award of appropriate compensation as opposed to a symbolic compensation. On the other hand, considering the difficulties inherent in the procedure of accessing the damage, judicial restraint is required, and exaggerated compensation awards should be avoided.

    If the assessment of non-pecuniary damage for infringement of autonomy poses difficulties in individual cases, the difficulty is multiplied sevenfold when the court is required to assess the damage in a class action, and particularly when it is impossible to locate the members of the group and form an individual assessment regarding each member concerning the intensity of the infringement of autonomy and the subjective negative feelings experienced by reason of the infringement.  The subjective nature of the damage also impedes upon ‘damage averaging’  and for this reason in the U.S.A. there is a reluctance to approve a class action for compensation for non-pecuniary damages (see Allison v. Citgo Petroleum Corp., 151 F.3d 402, 417 (5th Cir. 1998)[42]; Reeb v. Ohio Department of Rehabilitation and Correction, 435 F.3d 639, 650-651 (6th Cir. 2006)[43]; Fuhrman v. California Satellite Systems, 179 Cal. App. 3d 408, 424-425 (1986) [44]  ]; Altman v. Manhattan Savings Bank, 83 Cal. App. 3d 761, 767-769 (1978) [45]; Stilson v. Reader's Digest Association, Inc., 28 Cal. App. 3d 270, 273-274 (1972)[46]; Birnbaum v. United States, 436 F. Supp. 967, 986 (1977) [48].

See also the comments of Justice A. Proccaccia in a minority opinion in the decision on the application for certification, 697.

In Israel, this approach was rejected by Justice Naor, with whom the Deputy President S. Levine concurred. In the application for certification, Justice Naor held as follows:

The court will not award penal compensation in a class action, and similarly will not rule compensation without proof of damage, other than as specified in item 9 of the Second Schedule. However, the aforementioned does not preclude the ruling of compensation for non-pecuniary damage (emphasis added).

 All the same, while there is no impediment in principle to the awarding of non-pecuniary compensation, in the framework of a class action, cases may arise in which the difficulty of determining the rate of damage will justify non-certification of the filing of a class action or its dismissal on its merits (regarding this, see the case law of the district courts before and after the enactment of the Class Actions Law (CC (TA-Jaffa) 388/96 Yaari v. Israel Lands Administration, [   ] s. 6 (e) and (f); CC  (TA-Jaffa) 2331/06 Lubinsky v. Nazrian, [    ] 5- 6  ; CApp (Naz.) 1528/05 Barzilai v. Frinir (Hadas 1987)  Ltd,[    ]s. 27.2  (d). On the other hand, see CC (TA-Jaffa) 1586/09 Hayyut v. Telran Immediate Messages Ltd [   ]para. 4 (b) (5); CC (TA) 1341/00 Mazal v. Discovery International Modelling Agency Ltd [   ].

44. In our case, the Lower Court deemed that the difficulties in assessment of damage by reason of it being pecuniary damage and by reason of the practical difficulty of locating the members of the group and forming an individual impression of the damage caused to each one of them, do not justify the dismissal of the class action.  For purposes of assessing the damage and fixing the compensation, it resorted to the specific mechanisms of s.20 of the Class Actions Law,  and fixed the complex model for compensation that we described above, and in accordance with which it ultimately determined the remedy.

In this appeal, Tnuva again argues that our concern is with tortuous compensation that is generally assessed on an individual basis, and that given the representative plaintiff’s failure to prove the precise damage caused to each member of the group, the Court erred in its failure to dismiss the suit for that  reason. Tnuva further claims that the damage in this case does not admit of “uniformity"” because  the degree of damage incurred by each consumer differed, hence it argued that the sum awarded by the Court to each member of the group (NIS 250) was arbitrary and with no evidentiary grounding and should thus be set aside.

The representative plaintiffs claim on the other hand that the Lower Court rightly determined that this case admits of  an “average reasonable compensation” which when multiplied by the number of the members of the group would constitute the overall sum of compensation and that its determinations in this regard are consistent with the legislative intention as well as with the American case law in this context. However, their claim is that the sum per individual as determined by the Court is too low and in their appeal they seek to fix it at a minimum of NIS 8000, in view of the Court’s own determination to the effect that had it been confronted with an individual claim, this is the sum that is could have awarded for non-pecuniary damage.

45.  Section 20 of the Class Actions Law, titled “ “Proof of Entitlement to Remedy and Payment of Pecuniary Compensation” provides as follows:

(a) If the Court decided all or part of a class action in favor of all or part of the group in whose name the class action was conducted, than as part of its decision to award pecuniary compensation or other relief to members of the group it may make, inter alia, an Order specified below, as the case may be, on condition that doing so will not place an unnecessarily heavy burden on members of the group or on the parties:
	(1) to pay pecuniary compensation or to provide some other relief, at a rate and in a manner that it will prescribe, to each member of the group whose entitlement to the said compensation or relief has been proven;
	(2) that each member of the group prove his entitlement to the compensation or other relief;
	(3) to pay pecuniary compensation in an overall amount and how to calculate the share of each group member, on condition that the total compensation can be calculated exactly on the basis of evidence before the Court: if the Court ordered compensation to be paid in a said overall amount, then it may order how the remaining amount is to be divided among the members of the group in proportion to their damage, if one or several members did not claim their share, did not prove their entitlement to compensation or relief, were not located or could not be paid their share for some other reason; however, no member of the group shall receive pecuniary compensation or other relief in excess of the full compensation or relief due to him; if, after the said distribution to the members of the group an amount is left, then the Court shall order it to be transferred to the State Treasury.
(b) If the Court ordered that every group member prove his entitlement to pecuniary compensation or other relief, then it may make Orders about:
	(1) how and when entitlement shall be proven by members of the group and how it is to be divided, and for that purpose it may appoint a person with suitable qualifications (in this section: the appointee); if the Court decided to appoint an appointee, then any person who deems himself injured by an act or omission of the appointee may apply to the Court that ordered the appointment and the Court may approve, cancel or change the act or omission and make any Order on this matter, all as it finds proper; the appointee's pay and expenses, as well as how they shall be paid, shall be prescribed by the Court;
	(2) the payment of expenses to a group member, in an amount to be set by the Court or by the appointee, for the trouble involved in proving entitlement to the said compensation or relief.
c) If the Court concluded that, under the circumstances, pecuniary compensation for all or some members of the group is not practical, either because they cannot be identified and the payment cannot be made at a reasonable cost, or because of some other reason,

In the  Reichart [9] case, Justice Adiel pointed out in that in class actions there are a variety of methods of determining the damages, which are applied to a broad range of circumstances and in addressing the provisions of section 20 of the Class Actions Law he stated that:

…[O]n the other hand the point of departure may be the means of proof prescribed in s. 20 (a) (2) of the Class Actions Law….

whereby damage is proved by affidavits filed by each member of the group. Additional means of proof, essentially similar to the individual process, are based on the determination of damage for each member of the group, but without the conduct of the detailed process of filing affidavits, but rather by a general calculation based on undisputed factual data or admitting of simple proof.  Naturally, the two methods may be combined by drawing up a general formula to be applied to each individual of the group, in accordance with data specifically concerning him. On the other hand, there are additional ways of determining compensation, based on determining an overall sum of damages that was caused to the group in its entirety, using the methods outlined above. Finally, in cases in which the damage cannot be calculated (even where it is undisputed that it was incurred) there is the possibility of determining the sum of compensation by way of estimate (para. 67 of his opinion).   

    Justice Adiel further noted that Israeli law, similar to American law outlines two principal methods for determining damages in class actions. The first is the individual calculation whereby the damage is determined giving distinct consideration to each member of the group. According to this approach, after establishing the responsibility of the defendant in the question common to all of the group members, a separate decision is made regarding the damage caused to each one of its members and the cumulative sum of damages proved by the group members will constitute the sum of the defendant’s final liability.  This method of calculation is anchored in s. 20 (a) (1) and (2) of the Class Actions Law, cited above. Its advantage is that is consistent with the method of compensation prescribed in the General law and the principles of rectificatory justice on which it is based. It is generally involves the acceptance of affidavits from the group members or a calculation based on undisputed factual data or such as admits of simple proof (see Reichart [ 9 ], para. 67). In American law various additional  mechanisms were established, intended to assist in the individual assessment of damages in an efficient and economic manner (see e.g. Bates v. UPS 204 F.R.D. 440, 449 (N.D. Cal. 2001) [48] – the conduct of separate actions following the date of establishing the tortuous liability); Olden v. LaFarge Corp. 383 F.3d 495, 509 (6th Cir. 2004) [49]- the appointment of an expert whose role was to conduct separate hearings for each victim).  Some of these found their way into Israeli law (see se\. 20 (b)(1) of the Class Actions Law (see E.S.T  Project Management[6], pp.. 246-347; and Tetzet  [8], 788)

46.  Given the advantages of the approach based on individual calculation, it would seem that it is to be preferred or purposes of determining the remedy in class actions, to the extent that it is possible and this indeed was the approach taken  by the court in Reichart where it stated that “inasmuch as our case enables the determination of damages on an individual basis, I see no grounds for taking the path of the overall calculation (see Reichart para. 72). However this approach is not always applicable. The difficulty in applying it arises for example when the group members cannot be identified or located; when under the circumstances it is not possible to present data or documents sufficient for proving individual damage; when the damage incurred by each member of the group is minimal and presumably the group members or most of will be  unwilling to cooperate for purposes of proving it on an individual basis. Likewise, where the clarification of the individual damage caused to each one of the group members requires the investment of expensive resources and considerable judicial time  which have no justification under the circumstances, (see Steven Goldstein “The Class Action Suit – For What and Why” Mishpatim  9 (5739 416, 430 – 431) (hereinafter:  Goldstein))

The first difficulty that we addressed, of locating the members of the group is characteristic of representative plaintiffs in consumer matters (see decision in the certification application, p. 685) and  as mentioned, this difficulty also arose in our case given the impossibility of locating all of the consumers who consumed long lasting low fat milk during the relevant period. In confronting difficulties of this nature and others, some of which we mentioned, American law developed a second method of calculation – the method of overall calculation which was also adopted in Israeli law. According to this method, a “group compensation” can be determined on the basis of the damage caused to the group as a whole, even if the damage incurred by each member of the group was not proved prior to the determination of the overall compensatory sum. The purpose is to prevent the frustration of the goals of the class action in cases in proving individual damage is problematic. In the same vein, there were cases in which American case law resorted to “hybrid mechanisms” such as: an expert using a statistical formula to calculate the damages of the group members; an expert who conducts hearings and individual evaluations in relation to a representative sample of victims  (Hilao v. Estate of Ferdinand Marcos, 103 F.3d 767, 782-787 (9th Cir. 1996)[50](even though it appears that the use of this mechanism was restricted in a recent case: Wal-Mart Stores, Inc. v Dukes, 131 S. Ct. 2541, 180 L. Ed. 2d 374 (2011) [51] (hereinafter  Wal-Mart); the division of the group into sub-groups bearing typical features and the determination of an overall compensatory sum for each sub-group (see also LabA (NLC) 633/08 Erez v. Gal Maton Newspaper Marketing and Distribution Ltd [23], para. 18 (11 January, 2011)

The development of the system of overall calculation in American law began with the establishment of the Fluid Class Recovery mechanism (FCR), dwelt upon by the District Court in its decision. In its classical format, this is a three stage mechanism intended for compensation of the group members, and was described by the Californian Supreme Court as follows:

First, the defendant's total damage liability is paid over to a class fund. Second, individual class members are afforded an opportunity to collect their individual shares by proving their particular damages, usually according to a lowered standard of proof. Third, any residue remaining after individual claims have been paid is distributed by one of several practical procedures that have been developed by the courts" (The State of California v. Levi Strauss & Co. 41 Cal. 3d 460, 472-473 (1986)

       (hereinafter: Strauss)

The first stage of this mechanism is the determination of the sum of the group compensation which the defendant must pay and which he will deposit in a special fund established for that purpose.  At the second stage members of the group are given an opportunity to prove (at level of proof lower than the accepted level in personal suits)  the individual damage and in doing so receive their portion as personal compensation. At the third stage the balance of the sum is allocated in accordance with the various models that were developed by the court for that purpose. It is quite apparent that the three stages of the FCR process described do not provide an answer to all of the difficulties we mentioned. For example, in cases which preclude a determination of the sum owing to each member of the group, or such as the case before us, in which there is no possibility of locating the members of the group.   In order to provide a solution for these cases American law developed a variety of methods that deviate from the classic FCR model, some of which will be considered in what follows, along with the challenges raised against them, as we will presently show. (until here Case Review)

47.  In Israeli case law, the overall calculation approach was mentioned as a possible method of calculation already before the enactment of the Class Actions Law. For example, Justice (former title) Cheshin wrote in the Barazani Further Hearing [3] that: "Where awarding separate compensation for each of the group members is not practical, the court is permitted to obligate the defendant to pay compensation using special compensatory systems or other remedies, as it deems appropriate, provided obviously that the defendant is not compelled to pay more than the damage that was actually incurred" (ibid, at p. 425. See LCA E.S.T.  [5]; the decision on the certification application, at pp. 685-688; CC (TA – Jaffa) 2036/01 Mannela v. Mifal HaPayis  [  ]  para. 8). The mechanism of the overall calculation method was further established as part of the individual arrangements interspersed among the various legislative acts and by force of which class actions could be brought in the past (see e.g. the provisions established in s. 216 (b) of the Companies Law, 5759-1999; in s. 46I of the Restrictive Trade Practices Law, 5748; s. 16 I of the Banking (Customer Service) Law 5741-1981). This mechanism appears in s. 20 (a)(3) of the Class Actions Law, that as mentioned, replaced the individual arrangements and which regarding this matter states that the court may rule that:

"payment of pecuniary compensation in an overall amount and how to calculate the share of each group member, on condition that the total compensation can be calculated exactly on the basis of evidence before the Court…."

Furthermore, s. 20 (a)(3) of the Law contains a provision regarding the division of the compensation according to which in the event of a balance remaining after the distribution of the compensation to those victims who proved their damages and claimed compensation, it will be allocated proportionately between the group members, "provided that no member of the group shall receive pecuniary compensation or other relief in excess of the full compensation or relief due to him" and in that case the balance will be transferred to the State Treasury.

This provision is essentially similar to the classic format of the FCR mechanism mentioned above, and it enables the Court to determine overall compensation subject to the conditions prescribed in the section. In  Reichart  [   ] the court emphasized in this regard that the condition for the determination of overall compensation under s. 20 (a) (3) of the Law is that "the sum of overall compensation admits of precise calculation based on evidence before the court", and the court further added that "in terms of the principles for calculating the damage and its manner of determination, including the evidentiary law concerning weight and admissibility, there is no substantive difference between the methods used for an overall calculation and the methods used  for establishing individual damage…". The court further stressed in Reichart  [9] that even at the stage of allocating compensation among the group members consideration may be given to special individual data that is proved with respect to its individual members (para. 64 of the decision).

The difference between the various alternatives established in s. 20(a) relating to the manner of calculating the compensation and its allocation among the group members is that in first two alternatives (s.s. (1) and (2) the method of calculating damage  proceeds from the individual to the general, and the sum imposed on the defendant is the sum total  of the amounts to be received by each one of the group members.  In the third alternative, on the other hand (s.s. (3))  the process is reversed in the sense that initially the overall sum for the which the defendant is liable is determined, after which  that sum is allocated between the group members in accordance with the court's instructions, and subject to the caveat that overall compensation will not be awarded unless admitting of precise calculation based on the evidence before the court.

   48.  We already mentioned that the classic format of the FCR mechanism did not resolve all of the problems that arose in American Law concerning entitlement to a remedy and pecuniary compensation in class actions. This is also true with respect to the overall calculation method prescribed in s. 20 (a)(c), under the inspiration of that mechanism. The Israeli legislator was aware of this and hence added further mechanisms in s. 20 (c) of the Class Actions Law for determining remedies in class actions. Given the importance of this section for our purposes, we will again present the provision verbatim, which provides as follows:

"If the Court concluded that under the circumstances pecuniary compensation for all or some of the members of the group is not practical either because they cannot be identified and the payment cannot be made at a reasonable cost or because of some other reason then it may order other relief to be given for the benefit of all or part of the group or for the benefit of the public, as it deems appropriate under the circumstances of the case"

Is the court's permission to grant a remedy under this section "for the benefit of all or part of a group" or "for the benefit of the public" subject to the conditions enumerated in s. 20(a)(3) of the Class Actions Law, including the condition concerning "exact calculation" of the sum of overall compensation, as argued by Tnuva?.

The Lower Court dismissed this claim and ruled that:

Section 20 (a)(3)  [enables] the calculation of the overall compensatory sum for the group, and the waiver of individualized proof of damage. However, this is still considered as personal  compensation or a remedy for those members of the group who can be located and whose entitlement was proved, by way of allocating the sum of overall compensation between the those members. This must be clearly distinguished from the additional possibility at the court's disposal under s. 20(c ) of the Law, to rule a relief for the benefit of all or part of the group  or for the benefit of the public in those cases in which the Court concluded that under the circumstances pecuniary compensation for all or some of the members of the group is not practical either because they cannot be identified and the payment cannot be made at a reasonable cost or because of some other reason" (para. 104 of the decision, emphasis in source).

   Thus, according to the approach of the Lower Court s. 20(a)(3) of the Law establishes an independent for the determination of remedies and compensation in collective suits, existing alongside the other tracks prescribed in this context in s. 20(a)(1) and (2) and in s. 20(a)(3).  The Lower Court further added that in any case it was also unable to accept the interpretation that Tnuva attempted to give to the requirement for “precise calculation” included in s. 20(a)(3) of the Law, writing that:

Regarding that requirement for “precise calculation” of the overall sum of pecuniary compensation, it bears note that this requirement is implemented in a liberal manner in the U.S.A.  and it would seem that the legislative intention in Israel was to the take the path of American judicial experience. As noted by Hon. Justice Adiel (paras. 63 and 67) the overall calculation in U.S.A. relies on statistical calculations,  such as sample testing, or the use of mathematical models, which by definition do not lead to a “precise” calculation of the damage caused to the group. Likewise, and this point too was mentioned by Judge Adiel, the overall calculation system is used to overcome the difficulty of “simply calculating the damage of each individual of the group”, for example, in the absence of admissible documents or the difficulty of locating all of the members of the group.  Likewise, there is a difficulty in “precisely” calculating non-pecuniary damage, which necessarily involves estimation. Under these circumstances it is clear that the calculation of the compensation cannot be mathematically precise, and this was not the legislative intention. It is further important to point out that the requirement for “precise calculation” of the sum of the overall compensation was established in section 20(a)(3) of the Law, which deals with personal  compensation, for the group members, but not in s. 20(c) of the Law which relates to the a remedy for the for the benefit of the group (para. 100 of the decision, emphasis in source).

 49.   I accept the Lower Court's  position that the mechanisms of s. 20  (c ) of the Class Actions Law are intended to provide an answer for those cases in which it is not possible to precisely calculate the damage and distribute it according to one of the mechanisms prescribed in s. 20 (a) of the Law. Indeed, contrary to the position presented by Tnuva, s. 20(a) is not limited to difficulties in distributing the compensation between the members of the group ("because they cannot be identified and the payment cannot be made at a reasonable cost"). Section 20 (c) of the Law enables the award of a flexible remedy "for the benefit of the group" or "the benefit of the public" even in cases in which the awarding of compensation to the members of the group is not practical "for some other reason". Another reason of this kind may exist in those cases that preclude a precise calculation of the overall damage given that the data indicating the damage are not external data, such as a price hike of defined sum, but rather a collection of individual damages the precise proof of which depends on the testimony of each and every member of the group and  obtaining these testimonies is problematic – by way of example – if there is no possibility of identifying the members of the group.  In that situation, adherence to the regular rules of compensation in tort would frustrate the rationale and the underlying goals of the institute of the class action, which is intended to "protect the interest of the individual harmed who does not bother bringing an action; it represents a public interest in enforcing the provisions of the Law of which the class action is a part; it has a deterrent value against the violation of Law; it prevents the abuse of power by holders of control, whose portion of the capital is occasionally totally disproportionate to their power, and hence prevents manipulations at the expense of the "small investor"; it saves resources and prevents the multiplicity of suits" (CA 2967/95 Hanan Vakshet Ltd v. Tempo Beer Industries Ltd [24] at p. 323. See also the goals enumerated in s. 1 of the Law). It is for these reasons that the Class Actions Law outlines special arrangements that "occasionally deviate from the regular law and leave a broad margin of discretion for the court) Hanan Vakshet Ltd v. Tempo Beer Industries Ltd (as per President D. Beinisch, para. 6 of her opinion).

Structural failures of the kind discussed above in terms of the ability to prove "by precise calculation" the overall damage that was caused to the group or the individual damage caused to each member of the group, are particularly typical of consumer class actions. In cases of this kind there is an increased risk that the tortfeasor will profit and the profits reaped as a result of the tort committed will remain in his hands purely because of the difficulty of arriving at a precise calculation of the damage  which is spread over a large group of victims who cannot be identified (see Deutch, "A Decade for the  Class Action Suit", 33). American case-law refers to these profits as "ill-gotten gains". Regarding the justification for deviating from the classic principles of rectificatory justice in tort in this context, the Supreme Court of California wrote the following in the aforementioned Strauss case:

Fluid recovery may be essential to ensure that the policies of disgorgement or deterrence are realized. Without fluid recovery, defendants may be permitted to retain ill gotten gains simply because their conduct harmed large numbers of people in small amounts instead of small numbers of people in large amounts" (Strauss, p. 472).

50.  Indeed, s. 20 (c) of the Class Actions Law deviates substantially from the correlative principle underlying the regular principles of compensation which mandate total correlation between the circle of victims and the circle of the compensated. Compensation funds are not transferred to the victims and are used for "the benefit of the group" as such or "the benefit of the public", the assumption being that the victims  will derive indirect benefit. As such, the victims' interest in receiving compensation for the damage incurred is not realized in full.  However, from the victim's perspective the alternative of no remedy at all being awarded would support the award of a  remedy for the benefit of the group or the public, because partial and indirect benefit is preferable to not receiving any remedy at all.

A similar rationale also underlies the developing trend  that has developed in general Tort law, other than in the context of the class action, in cases of repetitive tendency. This tendency reflects the recognition that when applying the balance of probability rule in examining the causal connection between the acts of a particular tortfeasor and the damages caused to the victims at large it is preferable to promote the principle of rectificatory justice, even by way of cy pres comme possible, because the application of the principle in the classical sense, will in many cases achieve a result that is altogether remote from the restoration of the status quo ante.  This point was addressed  by Deputy President E. Rivlin in FHC 4693/05 Carmel Haifa Hospital v. Malul  [25] where he noted:

…in certain cases the principle of rectificatory justice  should be adjusted so that it focuses on the overall picture and not just on the isolated claim of a particular plaintiff before the court.  This enables a harmonization between the conception of rectificatory justice and the notion of relative compensation (para. 52 of his opinion. See also in para. 48 of Justice M. Naor's opinion).  

If the general law of tort is prepared to deviate from the principle of correlativity in suitable cases then a fortiori  it is both appropriate and correct to do in class actions. This is because in the class action and primarily those concerning consumer wrongs, the fundamental principle and goal that we seek to realize focuses on the achievement of effective and efficient deterrence against the dealers who breach the law and the consumers' rights ( see Deutch. "A Decade for the  Class Action Suit", 33). For otherwise the ones who profit are the tortfeasors who are large bodies that provide services to immense numbers of clients, and as such spread their damages among a large group of victims whose identity is not known, and their ill-gotten gain will remain in their own hands.  Redressing the injury caused to the individual victim on the other hand, is a less dominant interest in the class action given the fact that in most cases the damage caused to the individual consumer is relatively minor.

   Regarding the awarding of a remedy in the area of class actions in the U.S.A. by application of the principle of cy pres comme possible which originates in the laws of trust and means "as near as possible" and is also referred to as "next best recovery" see Natalie A. DeJarlais, The Consumer Trust Fund: A Cy Pres Solution to Undistributed Funds in Consumer Class Action, 38 Hastings L.J. 729 (1987); Stewart R. Shepherd, damage Distribution in Class Actions: The Cy Pres Remedy, 39 U. Chi. L. Rev. 448 (1972))for a critique of the expansive application of this principle, see  M. H. Redish, P. Julian & S. Zyontz, Cy Pres Relief and the Pathologies of the Modern Class Action: A Normative And Empirical Analysis, 62 Fla. L. Rev. 617 (2010) (hereinafter" Redish).

Hence, in terms of policy considerations both those anchored in the general rules of tort and those specific to the laws of class actions, we should strive to ensure that inability to identify the victims does not create an insurmountable obstacle to filing a claim in court (see A. Porat, "Collective Liability in Tort Law", Mishpatim 23, 311, at pp. 384-385), and see also comments of Justice E. Mazza in Barazani Further Hearing [3], at pp. 449 – 451).  In this context, for purposes of the class action proceedings the possibility of awarding a remedy for the benefit of a group or the public as established in s. 20 (c ) of the Class Actions law constitutes an important component.    

51.  All the same, we should not forget that another one of interests to be pursued in the class action proceeding is that of fairness to the defendant and protection of his substantive and procedural rights. From this perspective, and given that our concern is with a monetary remedy, we are obligated to ensure that the relaxing and flexibility of the procedural rules anchored in the Class Actions Law do not produce a situation in which obligation imposed upon him exceeds the sum of the damage that he caused) (regarding the dismissal of the motion to certify a class action inter alia by reason of this concern, see McLaughlin v. American Tobacco Co. [53 ]. Indeed, from the tortfeasor's perspective less importance attachés to the question of how the compensation is distributed. His substantive interest concerns the extent of the sums that he will be obliged to pay, and less with the question of how they are utilized thereafter. The desire to protect the interest of the defendant as mentioned underlies, inter alia, the provisions of the s. 20 (e) of the Class Actions Law, which negates the awarding of exemplary damages against the defendant and also negates the awarding of compensation without proof of damages (apart from in a suit in accordance with s. 9 of the Second Schedule). Another balance between the public interest of the victims on the one hand, and the defendant's interest on the other hand may also be found in the provision of section 20 (d)(2) of the Class Actions law in accordance with which in the awarding of the remedy the court may also have consideration for "the damage that is liable to be caused – by the payment of compensation, its amount or the manner of its payment – to the defendant, to the public that uses the defendant's services or to the general public by damaging the defendant's economic stability, as opposed to the expected benefit for members of the group  or for the public".  Parenthetically, it should be noted that Tnuva did not make any claims in court in reliance on the provisions of s. 20(d) (2) of the Law. It was for this reason that the Lower Court found no reason to consider these provisions and there are no grounds for us to address them at the appeal stage.

52.  American case-law offers a variety of approaches to the question of whether and under what circumstances the sum of compensation in class actions can be determined other than by a precise calculation. Some have contended that where there is no possibility of determining the overall sum in a precise manner, there are generally no grounds for using the FCR doctrine (on this interpretation of the FCR doctrine, see Michael Malina, Fluid Recovery as a Consumer Remedy in Antitrust Cases, 47 NYU L. Rev. 477, 488-491 (1972)). All the same, in order to resolve the difficulties that arise in this context the various U.S.A. courts, the courts have developed statistical mechanisms that enable the evaluation of the damage caused to a group, while waiving to certain degree the demand for "precision" (hence  damage was determined in relation to the average wage which was determined based on statistical means, see: Pettway v. American Cast Iron Pipe Co., 494 F.2d 211 (5th Cir. 1974) [54]; Stewart v. General Motors, 542 F.2d 445 (7th Cir. 1976)[55]; Bowe v. Colgate-Palmolive Co., 489 F.2d 896 (7th Cir. 1973)  [56]; United States v. Wood, Wire & Metal Lathers Int. Union, Local Union 46, 328 F. Supp. 429, 442 (S.D.N.Y. 1971)[57].  Similarly, the court enabled proof of damage by way of sampling and by means of other statistical methods. See e.g. Hilao v. Estate of Ferdinand Marcos [50].  For a different approach see Hood v. Eli Lilly & Company 671 F. Supp 2d  397, 434-453 (E.D.N.Y. 2009)  453 [58].

In Another case  (Long v. Trans World Airlines, Inc. 761 F. Supp. 1320 (N.D. Ill. 1991 [[59]) the court wrote that:

"Defendant has no "right" to an individualized determination of damages for each plaintiff; the desire for accuracy must be balanced against other factors such as the burdens of discovery in relation to the size of the individual claims." (Id. at 1327).

Even among scholars it has been contended that creative use should be made of "aggregate proof) in order to assess the rate of collective damage caused to the members of a group. This was noted by the scholars A. Conte & H.B. Newberg, in their book Newberg on Class Actions (Vol. 3, 4^th ed.2002):   

"There are occasions when it is feasible and reasonable to prove aggregate monetary relief for the class from an examination of the defendant's records, or by use of a common formula or measurement of damages multiplied by number of transactions, units, or class members involved, or by reasonable approximation with proper adherence to recognized evidentiary standards". (Id. 476).

53.  The interests we have examined that underlie the class action lead to the conclusion that where a remedy is awarded for the benefit of a group or the benefit of the public under s. 20 (c ) of the Class Actions Law, we should aspire to ensure that the overall sum of liability is consistent with the overall damages caused by the defendant. In order to determine this sum there is no impediment to adopting a method of estimation, which is an accepted and recognized method in our system for quantifying damages  in cases in that do not admit of precise calculation of the  damage incurred by the individual victim. This point was addressed by this Court in CA 355/80 Anisimov Ltd v. Tirat Bat-Sheva Hotel  [26],:

In those cases, in which, the nature and character of the damage, enable the production of accurate data, the victim-plaintiff must do so, and should he fail to do so damages will not be awarded to him. On the other hand, in cases in which the character and the nature of the damage render it difficult to prove the degree of damage and rate of compensation with certainty and accuracy, it will not frustrate the victim's claim, and it will suffice if adduces such data as can reasonably be obtained, while granting discretion to the court to make an estimate that supplements that which is missing  (p. 899).  

It was further ruled that in appropriate cases statistical data can be used for determining the scope of the damage (see; Rivlin, Shani, at pp. 506 – 507), and the expert opinion. As such, and a fortiori, this method may be used where it concerns a group. All the same, it is stressed that the evaluation of the damage by estimation does not mean the determination of an arbitrary amount which seems to be no more than a guess, and the court using its discretion in such a case must base the sum it determines upon  appropriate anchors that enable the evaluation of damage by way of estimation, as stated (see Daaka [4] at p. 583, Barak Erez, 277).

54.  The non-pecuniary damage which the Lower Court was requested to award in this class action is in the genre of damages the nature and character of which  do not admit of precise calculation and in cases of individual claims too, will always be subject to the court's estimation (apart from compensation claims for road accidents in respect of which the Compensation for Road Accident Victims (Calculation of Compensation for Non-Pecuniary Damages)  Regulation 5736-1976 (hereinafter Road Accident Regulations), prescribes  formula for determining non-pecuniary damage as a derivative of the rate of disability and a ceiling sum determined in the ss. 4 (a)(3) and 4 (b) of the Compensation for Road Accident Victims Law, 5735-1975). Regarding the essence and the methods for calculating non-pecuniary damage in differing contexts, see CA 4022/08 Agbaba v. Y.S. Company Ltd [27], paras 10 – 24;  C.A. 754/05 Levi v. Share Zedek Hospital [28]).

In s. 20 (e) of the Class Actions Law, the legislator authorized the court to  award compensation for non-pecuniary damage caused to the group member. However, the determination of non-pecuniary damage in the present case is no simple task. As mentioned, there is no possibility of identifying the group members who consumed long lasting, low fat milk during the relevant period for the suit, and hence the Court availed itself of statistical data and expert opinions in reliance upon which it reached a conservative, cautious determination that the group comprised 220,000 members. We concluded that the reference group for purposes of compensation for damage occasioned by infringement of autonomy is limited to that portion of the consumers group who incurred consequential damage due to the infringement of autonomy and who experienced negative feelings in various forms upon becoming aware that the milk they drank contained silicon.  Our determination regarding the number of group members included in the group of those entitled to the said compensation (154,000) was also based on statistical data and the expert opinions presented in the proceeding. Our concern is therefore with a group numbering over 100,000 people, whom can be neither identified nor located, and even were it possible to locate them, it is doubtful whether it would even be appropriate to instruct each one of them, or even some of them to submit an affidavit specifying the intensity of the negative feelings that they experienced in order to award compensation in accordance with one of the mechanisms established in s. 20 (a) of the Class Actions Law. Given the impossibility of determining compensation based on individuated evidence or precise calculation and the impossibility of identifying the members of the group entitled to compensation, we are left with the compensatory mechanism established in s. 20 (c ) of the Class Actions Law, which enables the determination of overall compensation based on an estimation for the benefit of the group or the public. The question that presents itself is how, if at all, to estimate the "collective" non-pecuniary damage in this case, and whether the fact of its being non-pecuniary damage that is characterized by subjective, individualistic features, should preclude the possibility of "uniformity" in determining the overall sum of compensation, due to the differences between the victims in terms of the results of the damage.

In rejecting Tnuva's claim in this context, the Lower Court ruled that "It is no longer possible to make a sweeping claim that uniform compensation cannot be awarded for non-pecuniary damage, absent the possibility of proving individuated damage" (para. 128) and hence the court fixed the sum of compensation at NIS 55 million, stating that this sum reflects uniform compensation for the sum of NIS 250 for each victim (220,000 X 250) for the non-pecuniary damage caused to the members of the group. The Court further mentioned that had a non-pecuniary compensation for Tnuva's action been awarded in the framework of an individual suit, the sum of the compensation would have been higher, but the court's approach was that this context demanded consideration of the fact that the issue was one of overall compensation being ruled for the group in its entirety or for the benefit of the public, in the absence of the possibility of having consideration for the individual damage caused to each one of its members. In the courts' words:

 [a]fortiori the court does not examine the individual damage of each member of the group, given that  not only is the remedy awarded to the group as a whole, but it is also given to the group and not to its individuals. The court is even entitled to fix the overall sum of compensation for the group based on estimation. This does not mean that the court should avoid the determination of important parameters for purposes of calculating the overall damage. The court must definitely determine the number of members in the plaintiff group, at least by way of estimate. Similarly, the court must assess the scale of the individual damage caused to  each one of the group members, to ascertain that the overall sum of compensation awarded to the group does not exceed the aggregate damage caused to its individuals. However, at the end of the day, the court must determine an overall sum of compensation to be awarded to the group having consideration for the totality of considerations, but it must not ignore the fact that the compensation is not intended as individual =  compensation for each of the group members. The overall compensation  must be commensurate and in proportion to the wrongful act and the circumstances of its commission, even if the division of the sum by the number of group members would indicate a lower rate of compensation by comparison to the rate of individual compensation that would have been awarded had a personal claim been filed against the defendant by reason of that tort.   

Granting the plaintiffs' request would have meant determining Tnuva's liability for an overall sum of NIS 1.76 billion (NIS 8000 X 220,000 members of the group). It is absolutely clear that this result is unreasonable and unrealistic. Having considered all of the circumstances as set detailed above, I determine an overall sum of compensation for the group of NIS 55 million which reflects an estimated rate of damage for each members of the group of the sum of NIS 250. This degree of damage, and even higher, was most definitely caused to each member of the group, even if only by reason of the infringement of individual autonomy (para, 134 (b) of the decision, emphasis in source).

55. In this appeal, Tnuva challenges the determination of the compensation according to the mechanism prescribed in s. 20 (c ) of the Law, arguing that  given the type of the damage (non-pecuniary damage, with subjective-individual features), and given the impossibility of proving the damage to the group in terms of its individual members due to the impossibility of identifying its members, there were no grounds for determining uniform compensation for the group, even at a minimal rate  NIS 250 for each individual). On the other hand, Raabi claims that given the Court's view that the appropriate compensation for the infringement of autonomy had it been a personal suit was not less than NIS 8000, it should have awarded that rate of compensation multiplied by the number of members in the group (which was similarly challenged on the part of Raabi, as detailed above), and the fact that such a significant figure was received as a result

Indeed, in cases in which there is significant differentiation between the group members it may yield the conclusion that the matter is not suited for adjudication as a class action (see s. 8 of the Class Actions Law; CA Reznik v. Nir National Cooperative Association for Workers Settlement  [29] paras. 24 – 27 (hereinafter: Reznik), See also LabApp (Nat.) 425/00 Goldberger v. Guards Association Ltd  [    ] para. 8 ; Civ.App. (Naz) 1528/05 Barzilai v. Ferinir (Hadas1987 ) Ltd (para. 27.2) [  ]; on the other hand, see TM 105/06 (CivApp.30858/06) (Tel-Aviv-Jaffa) Feldman v Municipalities Sewage Association (Dan Region) para. 52 ; CF (Tel-Aviv-Jaffa) 2719-06 Levi v. Israeli News Company Ltd para. 17; and see also Klement, "Boundaries of the Class Action", at pp. 345-346).   It would seem however that the claim concerning differentiation between the group members has the power to bring about the non-certification of the suit as a class action and even its rejection if certified, in those cases in which the differentiation has implications for the establishment of liability or even the very existence of an actionable cause.  The main concern in this context is that it may prejudice the defendant's right to a fair proceeding and to be able to defend himself against each and every one of the group members. This happened in the Resnik [29] case where the defendants raised the prescription claim, the decision on which was not necessarily identical with respect to each and every member of the group, and for that reason the court did find grounds for its certification as a class action.  In that case Justice Gronis stated that "Certain solutions for the absence of homogeneity between the group members are found in ss. 20 (a) – (c) of the Class Action Law, that includes provisions  regarding the remedy that will be awarded by the court".  The court further added that it was not required to rule on the question of the "cases in which the suit should be certified as a class action notwithstanding the existence of individual features, by having resort to the mechanisms of s. 20 of the Class Actions Law, or other solutions" but it still saw fit to stress that there are cases in which "these solutions are unable to provide a solution" and as a result they cannot be certified for filing  as a class action (ibid, para. 27). The issue of differentiation (the foundation of commonality) between the group members was likewise the subject of discussion in  recent decision of the Supreme Court of the U.S.A in the Wal-Mart  issue. In that case a request for certification of a class action was filed in the name of a million and a half employees of the Wal-Mart network based on illegal discrimination against them as women with respect to matters of salary and promotion.  The trial instances and the appellate instance certified the suit as a class action Dukes v. Wal-Mart Stores, Inc. [51] . The Supreme Court however reversed the decision, ruling that the suit should be be certified in view of the plaintiffs' failure to prove that the company had conducted a general policy of discrimination, in other words, it failed to prove the existence of a grounds for claim regarding every single group member. It also held that under the circumstances it was not possible to calculate a compensation sum by statistical methods and by way of a representative sampling, inter alia  in view of the defense claims in the law itself, which the company was able to raise regarding each and every company in the group.

Tnuva's argument concerning differentiation is to no avail in our case.  Its argument relates exclusively to negating the possibility of awarding uniform compensation for the non-pecuniary damage sustained by the group members under the circumstances, in view of what it claims is the lack of uniformity among the victims in this context.  In the Court's eyes, this differentiation did not justify the non-certification of the suit as a class action and I concur with the stance of the Lower Court that neither does it preclude the award of a remedy after the clarification of the class action that was certified as stated.   First, even in suits that are not conducted as class actions in which there are multiple plaintiffs, such as suits for building defects, the court does not refrain from awarding uniform compensation by way of estimation for the non-pecuniary head of damage (on "uniformity of damage" for mental anguish in regular suites filed on behalf of a number of plaintiffs, see the district court decisions cited in para. 121 of the decision). Second, as distinct from differentiation among the members of the potential group, that may have implications for the existence of an actionable cause and the basic entitlement of each member to a remedy, where the differentiation concerns the sum of compensation, it finds its solution in the various mechanisms of s. 20 of the Class Actions Law that deal with the remedy that the court is authorized to award. The establishment of these mechanisms is intended to ensure that the differentiation among the group members regarding the determination of the remedy, just like other difficulties in proving damage which stem from the inability to identify or locate the group members, will not frustrate in limine  the clarification of the matter by way of a class action and the realization of the goals upon which this proceeding is based in terms of the public interest and in terms of the group concerned, which we dealt with above at length.  Accordingly, differentiation relating to the rate of the damage, will not  in general prevent the clarification of the class action and the award of a remedy in the framework thereof, including with respect to the award of uniform compensation that will be determined by way of estimation, unless under the circumstances of the particular case prevent the award of an appropriate remedy in accordance with one of the mechanisms set forth in s. 20.

56.       That said, it would not be superfluous to note that differentiation between the group members may occasionally be raised as an argument for denying certification of suit as a class action, or against the award of a uniform compensation in the framework thereof, specifically from the perspective of the potential group members, in those cases in which awarding uniform compensation prejudices the rights of those group members who wish to prove their suit on an individualized basis and thereby merit larger compensation. American case-law treated this concern as a potential violation of due process rights, which  in turn lead to the rejection of the certification applications for class action suits, stressing the fact that the mechanisms established in the relevant statutory provisions do no include the right to opt-out of a class action proceeding, see  - Federal Rules of Civil Procedure,  Allison v. Citgo Petroleum, 151 F.3d 402, 414-415 (5th Cir. 1998) [60]; Lemon v. Int'l Union of Operating Engineers, Local No. 139, AFL-CIO 216 F.3d 577 (7th Cir. 2000) [61]; Jefferson v. Ingersoll Int'l, Inc. 195 F.3d 894 (7th Cir. 2001) [62]; Reeb v. Ohio Department of Rehabilitation and Correction, 435 F.3d 639 (6th Cir. 2006) [63].

For additional cases in which class actions were not certified in the U.S.A. against the background of the differentiation between the group members, see In re Fibreboard Corp., 893 F.2d 706, 712 (5th Cir. 1990) [64]; Windham v. American Brands, Inc., 565 F.2d 59 (4th Cir. 1977) [65]. However, in the U.S.A. this approach is not relevant to certification applications for class actions in accordance with legislative provisions that contain mechanisms for an opt-out right.

 Israeli law in this context differs. The Class Action Law mandates the registration of the application to certify the suit as a class action, and the registration of its certification in the Class Actions Register (ss. 6 (a) and 14 (b) of the Law, and irrespective of the nature of the suit each and every group member is entitled to give notice that he does not wish to be included therein (s. 11 of the Law).   Moreover, proponents of the approach that views the group as an entity in its own right have  opined that there is need for a "sacrifice" on the part of each member of the group of with respect to his individual rights as a litigant, in view of his obligation to "tie his fate" with the fate of the group  (see David L. Shapiro, Class Actions: The class as Party and Client, 73 Notre Dame L. Rev. 913, 919 (1998).

The claim raised by Raabi in his appeal concerning the paucity of the uniform sum  that was awarded is not based on the claim of differentiation and the claim that any particular member of the group suffers as a result.  Raabi does not dispute the fact that in this case, in the framework of a class action, it was not possible to clarify the individualized damage incurred by each and every group members nor does he dispute that it was not possible to identify or locate them.  His claim relates solely to the smallness of the sum awarded as uniform compensation (NIS 250), given the fact that the Lower Court expressed its view that had the case been adjudicated as an individual claim it would have been appropriate to award far higher compensation (NIS 8000). Accordingly, Raabi claims that the sum of uniform compensation for purposes of calculating the overall compensation for the benefit of the group should be set at  NIS 8000.

57.  Examination of the Raabi's testimony (pp. 71-81 of the protocol) indicates that over a period of years that included the entire period that was relevant for the class action (23 October 1994 until September of 1995) he consumed significant quantities of  long lasting low fat milk. However, the range of consumers of long lasting milk is varied both in terms of the duration of the consumption period and in terms of the scope of consumption. Hence, it may be assumed that the relevant group includes those who did not consume the milk for the duration of the period, those who consumed it in far smaller quantities than those consumed by Raabi and those who drank fresh milk on a regular basis and who only consumed the long lasting milk that they had purchased on rare occasions, when under various circumstances it served as substitute for fresh milk.  This varied range of consumers of long lasting milk that contained silicon must be taken into consideration when determining the uniform compensation to be awarded for the violation of the autonomy of the group members who suffered consequential damage as a result.  The claim of the  representative plaintiffs' that the group in its entirety should be awarded the same compensation (NIS 8000) that was demanded by Raabi as the main plaintiff, fails to consider the differentiation between the group members that we discussed above, and for that reason alone we can dismiss the claim.   Furthermore, contrary to the position of the Lower Court, even on an individual level I see no justification for awarding Raabi compensation for the sum of NIS 8000 (as valued on the date of the suit) for the damage head of infringement of autonomy. This takes into account the fact that we are no concerned with an infringement of the highest conceivable level and the fact that as distinct from compensation awarded in other contexts of non-pecuniary damage, our concern is with negative feelings experienced by the group members for a limited time, the peak of which was presumably when it became known to those who had consumed the milk, post factum, that it contained silicon.  In other words, the non-pecuniary damage is not of the kind that accompanies the victim for life, such as pain and suffering in the wake of permanent physical disability as a result of medical negligence.  As such I think  that on an individual level too, even where it concerns a permanent consumer of long lasting  low-fat milk for the entire relevant period, the compensation sum awarded for consequential damage (feelings of anger, frustration, revulsion, anxiety, fury etc)  resulting from the infringement of his autonomy should not be exaggerated.  A fortiori, the uniform  compensation to be awarded to the entire group should not be exaggerated, given the differentiation between its members in terms of the scope of the damage and its intensity.

58.  This brings us back to the question of what constitutes the group compensation to be awarded in the case at hand, and whether the path taken by the Lower Court was appropriate for its ruling. As mentioned, the Lower Court concluded that compensation amounting to NIS 1.76 billion, which is arrived at by multiplying NIS 8000 for an individual by the number of group members (220,000), is a result that "is unreasonable and unrealistic" and it therefore set the sum of the overall group compensation at  NIS 55 million, stating that this sum "reflects an estimated individual damage of  NIS 250 for each of the individuals of the group".

In view of the great variety in the group in terms of its habits of consumption of long lasting milk containing silicon and in view of other features of the infringement of autonomy which we discussed above, including: the intensity of the infringement, and the fact that one can imaging higher rates of intensity, and the limited duration of the time during which the members of the group experienced negative feelings, I believe that the sum of NIS 250 can be accepted as a sum that is commensurate for purposes of setting the individual, uniform compensation.  The multiplication of this sum by the number of group members who suffered consequential damage by reason of the infringement of autonomy gives us an overall compensation sum of NIS 38,500,000 (250 X 154,000).   In its pleadings, Tnuva proposed that to the extent that it be obligated to pay compensation, it would be appropriate that the profit it made should serve as a basis for its calculation, indicating that the profit was NIS 1,645,900 in terms of the principal and with the addition of interest and linkage differentials (from the middle of the period)  - NIS 4,981, 616. In principle, this model for calculating compensation should not be negated (on the approach whereby compensation based on denial of the tortfeasor's profits realizes the principle of corrective justice in the law of tort, in appropriate cases, see Ernest J. Weinrib Restitutionary Damages as Corrective Justice 1 Theoretical Inquiries in Law 1 (2000).  It has even been claimed that this model is preferable for class actions in which the compensation awarded is a compensation for the benefit of the public under s. 20 (c ) of the law. This is because in cases like these there is no real correlation between the obligation imposed upon the tortfeasor and the public of those who are compensated, and the purpose of remedying the damages of the victims is not really achieved due to the practical inability to identity the members of the group, to identify them or to compensate them. As such, the emphasis should be placed on the other objectives of the law of tort, including effective deterrence and prevention of unlawful enrichment of the tortfeasor. Indeed, the use of unlawfully obtained profit as a departure point for calculating compensation maintains the correlation between the intended purpose of the compensation and the manner of its calculation. However, even though on the level of principle the model based on the denial of profit for calculating compensation for the benefit of the public under section 20 ( c) of the Class Actions Law  should not be dismissed, it must be remembered that this model is not appropriate and not applicable in all of the cases. For example, it would difficult to apply it in a case which the tortfeasor did not profit as a result of the wrongdoing.  As such, when awarding compensation for the benefit of the public the court must examine all of the data before it, and in accordance therewith to formulate the model best suited for its ruling. In our case, at the very outset Tnuva did not present us with detailed, substantiated and reliable data on the basis of which it would have been possible to examine the possibility of calculating overall compensation based on the denial of profit model.  For example, Hagit Adler (who was employed in Tnuva as of 1996 and who served as the marketing manager when she gave her affidavit), stated that at the time of giving the affidavit (November 2004) “Tnuva does not have ….precise data regarding the rate of profitability of long lasting milk of 1% fat during the relevant period (section 17 of the affidavit). Adler did propose to base the findings in this case on the rate of the profitability of long last milk with 1% fat on the later years (1999 – 2001), but regarding these years too, the only thing that was attached was a page of pricing relating to these years, taken from a document that was not presented in full, the authorship of which is not clear nor the data on which it is based, One of the other possible models or purposes of determining compensation for the benefit of the public, is the model that was adopted by the Lower Court and which we too endorsed. This formula, based on statistical data (regarding the number of victims) and uniform individual compensation, complies – albeit in the form of cy-pres calculation -  with the traditional and accepted method of calculating compensation in torts law. All the same, and given that our concern is with cy-pres calculation, the application of the this model must be subject to the caveat that the cy-pres calculation must be done with the requisite caution and tend to be conservative, so that the sum of overall compensation will not spill over into the realm of punitive exemplary compensation which are not to be awarded in representative suits, pursuant to the legislative fiat in section 20 (e) of the Class Actions Law.

In conclusion, the overall compensation that should be imposed on Tnuva in this case according to the model that we endorsed is fixed at NIS 38, 500,000 as valued at the date of the decision of the Lower Court, (17.10.2008).

The Method for Distributing the Compensation Awarded for the Benefit of the Public

59.       In order to balance between the public objectives and the private objective, American law has formulated a variety of mechanisms for providing a remedy for the benefit of the group in its entirety or for the public benefit, including discount mechanisms (“price rollbacks”); the transfer of the compensation funds to government body by way of their designation for goals that will benefit the actual victims (“earmarked escheat”);  a “consumer trust fund”; and in appropriate cases, the relative participation (pro rata) of the current group members in balance of the funds (“claimant fund sharing” (regarding this, see Strauss, at pp. 473- 476). All the same, there are those who have sharply criticized the use of collective compensatory mechanisms for the public benefit in cases in which it is difficult or impossible to the individually compensate the members of the group (see e.g. Redish; Powell v. Georgia-Pacific Corporation, 119 F.3d 703, 706 (8th Cir. 1997) [66]; In re: Airline Ticket Commission Antitrust Litig, 268 F.3d 619, 625 (8th Cir 2001) [67].Regarding the variety of approaches adopted in American case-law on this matter and the differing approaches to the most optimal correlation between the distributive mechanism and the goals of the particular suit and the interests of the group members, see  In re Folding Carton Antitrust Litig. 744 F.2d 1252 (7th Cir. 1984) [68] ; Houck v. Folding Carton Admin. Comm., 881 F.2d 494 (7th Cir. 1989) [69]; In re Cuisinart Food Processor Antitrust Litig.38 Fed. R. Serv. 2d (Callaghan) 446 (D. Conn.1983) .[70]; Democratic Cent. Comm. v. Washington Metro. Area Transit Comm'n [71]   ], 84 F.3d 451 (DC cir. 1996); In re Domestic Air. Transp. Antitrust Litig,    148 F.R.D. 297 (ND Ga 1993) [72] . 

On the approaches adopted by scholars on this issue, see Newberg, 505-543; Anna L. Durand, An Economic Analysis of Fluid Class Recovery Mechanisms, 34 Stan. L. Rev. 173 (1982); Kerry Barnett, Equitable Trusts: An Effective Remedy in Consumer Class Actions, 96 Yale L.J. 1591 (1987); Christopher R. Leslie, A Market-Based Approach to Coupon Settlements in Antitrust and Consumer Class Action Litigation, 49 UCLA L. Rev. 991 (2002).

See also Goldstein, 430- 431. on the use of systems of collective compensation in the Common law states, see Rachel Mulheron, The Class Action in Common Law Legal Systems: A Comparative Perspective, 426-430 (2004)

As indicated by the provision of section 20 (c ) of the Class Actions Law, the Israeli legislator chose an approach that enables an award of compensation for the benefit of the group as a whole and for the benefit of the public according to a system of collective compensation, even in the cases in which technical reasons preclude individuated compensation for the group members. In doing so the legislator expressed the view that the public goals which the Class Actions Law is designed to serve and which we dwelt on at length above are of no less importance than the private goals and hence the  reason to strive to realize those goals even where various difficulties prevent the proving of the precise aggregate of the individual damages caused to the group and the maintenance of conformity between the public of victims and the public of those who are compensated. At the same time, it is important to note that according to the hierarchy prescribed by section 20 (c ) of the Class Actions Law, preference should be given, to the extent possible, to compensatory mechanisms that reflect such conformity, and even when awarding compensation according to section 20 (c ), in the absence of the possibility of awarding it under sub-sections (a) and (b), every effort should be made to structure the mechanism for distribution of compensation in a manner that achieves at least an element of connection between the public of those compensated and the public of victims.

60.  In the case before us, regarding the distribution of the Lower Court held as follows regarding the distribution of the

“Having consideration for the difficulties involved in the solution of the reducing the price of milk, given the immense sum of overall compensation ruled in favor of the group (NIS 55 million) and for reasons of the benefit of the group and the public – the sum of the compensation should be designated for three essential goals – First, benefitting the group members by reducing the price of the product (or increasing the contents without raising the price); second – research and scholarship fund in the field of food and nutrition which have implications for public health; third - distribution of milk free of charge to populations in need via non-profit organizations so involved (para. 144 (O), of the decision, emphasis in source).

In holding that one of the objectives for which part of the compensation sum should be awarded is the providing of a benefit via a discount from the product price, the Court, by its own account,  was at the every least attempting to establish a group connection between the victims of Tnuva’s conduct and those who would gain from the benefit. However, in our case it is doubtful whether such a connection actually exists. The connection which the Lower Court sought to establish in this context proceeds from the assumption that those who consumed long lasting low fat milk of Tnuva during the relevant period continue to do so today as well. The problem is that there is only a low probability that this assumption actually materialized, inter alia because of the passage of time and changes in consumption habits and even more so when considering our conclusion to the effect that compensation for infringement of autonomy during the relevant period (23 October 1994 – September 1995) should not be awarded exclusively according to objective criteria and the victims group should be limited to those who suffered consequential damage as a result of the infringement and experienced revulsion, frustration, anger, and other similar negative feelings. When supplementing this by the considerable dangers generally involved in a discounts arrangement that requires a detailed examination of the influence manner in which the arrangement affects the relevant market (see Amir Israeli “Settlement in a Class Actions that Infringes Free Competition, in the wake of CF 1012/02 Yifaat v. Delek Motors Ltd   [   ] Hearat Din 2 (2) 112, 118 – 125) (5665), and the need to receive a reconfirmation from the Director of Antitrust (due to the passage of time from the time of that the gave the previous confirmation in this context) it would seem that in the current case it is preferable to waive the allocation of part of the compensation for the purposes of the discounts arrangement and to focus on the two other objectives determined by the Lower Court, which serve worthy interests for the benefit of the public in its entirety. The portion deducted for purposes of the discount arrangement will be divided equally between these two objectives and hence the compensation sum shall be distributed in the following manner:

       a.         For the study and research fund – 44.33% and for the distribution of milk products to the needy 55.66%.

       b.         The distribution of the  milk products (and not just long lasting milk that formed the subject of the claim) will be effected over a period of five years from commencement date for the execution of the decision, by way of the 2 non-profit organizations "latet" and “Mishulhan leShulhan”  both of which supply food to dozens of other non-profit organizations around the country, as held by the Lower Court in its decision of 17 June 2009, which gave force to the agreements reached between the parties with the cooperation of the representative of the Attorney General and with his consent, attached to the notification of the parties dated 10 June 2009, in the Lower Court (hereinafter: “the supplementary decision”).

       c.         For purposes of transferring the compensation for research purposes in the field of food and nutrition, a study fund will be established, headed by the Head Scientist of Ministry of Health. The fund management will choose the studies that are to receive scholarships, and will supervise them. The members of the management will be the entities specified in section 6C of the agreements reached between the parties and which were approved in the supplementary judgment.  The intention is to use the entire sum of compensation earmarked for the study fund within 5 years, unless it becomes necessary to use the sum thereafter as well, in keeping with the Lower Court’s decision in the supplementary decision.

       Compensation for the Representative Plaintiffs and

    61.          In its partial decision and its supplementary decision the Lower Court ordered the payment of compensation and advocates fees to the representative plaintiffs and their attorneys, and all told ordered Tnuva to pay the sum of NIS 500,000 to the Raabi heirs; the sum of NIS 1,000,000 to the Israel Consumer Council and the sum of NIS 2,500,000 to the attorneys of the representative plaintiffs.

       Tnuva argues that according to the criteria outlined regarding this issue in the Class Actions Law, there were no grounds for awarding such high sums to the representative plaintiffs and their attorneys. In this context Tnuva contends inter alia that the involvement of the Israeli Consumer Council in this context was only minimal, that it did not assume any risk and did not require any monetary incentive for acting in consumer related matters.  It further submits that the rate of the compensation and advocates fees awarded is far in excess of the rate awarded in other cases, and that in this context it would have been appropriate to have consideration for the discrepancy between the sums demanded by the representative plaintiffs (who initially set their at NIS 4 billion) and the sum that was finally awarded.

The representative plaintiffs on the other hand claim that there are no grounds for interfering in the rate of compensation fixed by the Supreme Court, which does not deviate from the criteria prescribed by statute and case law in this context. On the other hand, they see cause for interfering in the sum of fees awarded to their attorneys and contents that the considerations that guided the court in this matter were mistaken. Inter alia they argued that there was no basis for the finding of the Lower Court to the effect that "the case was not always handled in "the best and most efficient manner" and that under the circumstances there were no grounds for attaching weight to the discrepancy between the sum demanded and the sum awarded  and that their attorneys invested extensive and intensive work over the years in this precedential case, which is tremendously important from a public and consumer perspective.  As such they claim that an order should be given for fees amounting to 20% of the overall sum of compensation.

62.  The criteria for the determination of compensation for the representative plaintiffs are set forth in section 22 of the Class Actions law, which states:

 

Compensation for the representative plaintiff

22. (a) If the Court decided all or part of a class action in favor of all or part of the group, including by way of approving a compromise, then it shall order compensation to be paid to the representative plaintiff,

taking into account considerations said in subsection (b), unless it concluded – for special reasons that shall be recorded – that that

is not justified under the circumstances of the case.

 (b) When it sets the amount of compensation the Court shall, inter alia, take these considerations into account:

 (1) the effort exerted and the risks assumed by the

representative plaintiff by bringing and conducting the class action, especially if the relief requested in the action is declaratory relief;

 (2) the benefit which the class action yielded for members of the group;

 (3) the degree of public importance of the class action.

 (c) In special cases and for special reasons that shall be recorded, the Court may:

 (1) adjudge compensation to the petitioner or representative plaintiff, even if the class action was not approved or if the  

class action was not decided in favor of the group, as the

case may be, taking the considerations said in subsection (b) into account;

 (2) adjudge compensation to an organization that participated in hearings of the class action under the provisions of section 15, if it found that to be justified by the trouble taken and the  contribution made by its said participation in the hearings.

 

Section 23 of the Law established criteria for the ruling of the legal fees of the representative attorney, as follows

23. (a) The Court shall set the representative attorney's legal fees for conducting the class action, including the petition for certification; the representative attorney shall not accept legal fees in excess of the sum determined by the Court as aforesaid.

 (b) When it sets the representative attorney's legal fees under subsection (a), the Court shall, inter alia, take the following considerations into account:

 (1) the benefit which the class action yielded for members of the group;

 (2) the complexity of the proceeding, the trouble taken by the representative attorney and the risk he assumed by bringing and conducting the class action, as well as the expenses he  incurred for that purpose;

(3) the degree of public importance of the class action;

 (4) the manner in which the representative attorney conducted the proceeding;

 (5) the gap between the relief sought in the petition for approval and the relief adjudged by the Court in the class action….".

   The criteria for determining compensation and legal fees are essentially similar and reflect the desire to incentivize the filing of class actions (on the importance of this consideration see Moshe Telgam, "The Class Action – Considerations for the Determination of Fees and Compensation" Shaarei Mishpat 4, p. 227 (5768). All the same, it should be noted that an overincentive in this context could encourage the filing of trivial suits or "inflated" suits with no justification, given that those filing these suits would be primarily interested in the compensation and legal fees that they could expect to receive (on the negative influence of trivial suits and the attendant concern of a weakening of the standing of the class action, see CA  1509/04 Danush v  Chrysler Corporation [30] para. 15).  An additional, and important criteria for the determination of legal fees, reflected in s. 23 of the Law cited above, is the existence of a commensurate relationship between the legal fees and the effort invested in the suit and the benefit it produced. The Law further adds and prescribes in this context a number of criteria intended to guide the conduct of the attorney of the representative plaintiff' so as to create a positive incentive for conducting the suit efficiently and fairly (see CA 9134/05  Adv. Eliezer Levit v. Kav Of Zafon, Cooperative Association for Services Ltd  [31] para. 12 (hereinafter – Levit), regarding s. 23 of the Law.  And see also AAA 2395/07  Accadia Software Systems Ltd v. State of Israel – Director of Tax and Stamp Duty [32] para. 20 (hereinafter – Accadia);  CA 7094/09 Borozovsky  Conveyancing Ltd v. Ichurn Itur Veshlita Ltd [33] paras 11- 14).  As evidenced by the wording of ss. 22 and 23 of the Law, the list of considerations enumerated is not exhaustive and is intended to outline "general guidelines which attest to the general intention of the law and the objectives it seeks to realize" (see Levitt, para. 12). That said, in general the criteria enumerated in the law may be divided into three principal categories: considerations of expenses, considerations of yield for the group represented, and considerations of public guidance (see Klement, at pp. 158 – 162).

63.  A central question to be considered in determining the rate of compensation and the legal fees is whether the filing of the class action was necessary in order to merit the particular remedy (Levit [31] para. 14). The case before us is a classic example of a case which would not have been decided had it not been for the class action. In determining the compensation the court gave consideration to this central consideration as well as to the other pertinent considerations, indicating that the task of differentiating between the representative plaintiffs was done for the main part by the Consumer Council, and in dwelling on the importance of creating incentives for the filing of suits for the Consumer Council as well. The Court further dwelt on the fact that this case made an important contribution to the group and the public and addressed the protracted time period during which the suit was conducted. Regarding the legal fees to be awarded to the representative attorneys the Court addressed the immense amount of work that they had invested, the tremendous benefit bestowed by the suit itself, its importance for the group and for the public as a whole, and the complexity of the issues raised in the file. At the same time, the Court stressed the gap between the remedies demanded and what was ultimately granted, noting that the suit had not always been conducted in the best and most efficient manner"

The rule that the appellate forum does not interfere in the rate of legal fees awarded by the trial forum applies to and is implemented with respect to the rates of legal fees and compensation awarded in class actions, other than in cases where one of the sums awarded is legally flawed or where the decision of the trial forum is otherwise fundamentally flawed in a manner that warrants intervention (see Accadia [32] para. 28, Analyst [7] at p. 263). The policy of non-intervention in sums awarded as legal fees and compensation by the trial forum is even more appropriate where it concerns considerations pertinent to the manner in which the proceeding was conducted.  In the case at hand, the Lower Court examined all of the relevant considerations and balanced between them as required.  Accordingly, had we not reached the conclusion that the sum of compensation to be imposed on Tnuva should be significantly reduced, we would not have intervened in the sums of compensation and legal fee that it awarded. However, since we set the sum of compensation at NIS 38,500,000 instead of NIS 55,000,000  awarded by the Lower Court I think that this also warrants a reduction in the sum of compensation that Tnuva has to pay to the representative plaintiffs and the legal fees to be paid to their attorneys. I therefore propose that we set the sum of compensation for the Raabi heirs at the sum of NIS 300,000, the compensation for the Israeli Consumer Society at NIS 550,000 and the rate of legal fees for the representative attorneys at NIS 1,500,000. In order to remove all doubt, it is clarified that the sums specified above, like the sum of compensation awarded, are according to their value on the day of the decision of the Lower Court (7 October 2008).

 

       Final Word

For all of the reasons set forth above I propose to my colleagues to partially allow Tnuva’s appeal with respect to the rate of the compensation (CA 10085/08) and its appeal regarding the compensation for the representative plaintiffs and the fees of their attorney (CA 7607/09). I further propose to my colleagues to dismiss the counter appeal of the representative plaintiffs in CA 10085/08 and their appeal against the decision in CA 6339/09)

Under the circumstances and bearing in mind that these appeals raised questions of principle that were fleshed out for the first time since the enactment of the Class Actions Law, I would propose to my colleagues not to make any order for the costs of the appeal proceeding

 

                                                                   Justice

Justice I. Amit

 

 I concur with the comprehensive and thorough judgment of my colleague Justice Hayut. My colleague concluded that compensation for infringement of autonomy should only be awarded to those group members who experienced various negative feelings upon becoming aware that they had drunk milk containing silicon. My colleague's approach is consistent with the view that I expressed in CA 4576/08 Ben Zvi v. Prof. His [ 17] paras. 25 – 29, according to which an infringement of autonomy is now included within the framework of non-pecuniary damage. An infringement of autonomy means negating the victim's freedom of choice by failing to disclose a substantive detail, but the infringement of autonomy is expressed by negative feelings such as anger, frustration, insult, revulsion,shock etc.  

                                                                   Justice

 

 

Justice  E.  Vogelman

 

 I concur with the comprehensive judgment of my colleague, Justice E. Hayut.   I am a partner to my colleague's conclusion that the objective approach to the assessment of compensation for infringement of autonomy should not be accepted and that accordingly, where proved that some of the members of the group remained indifferent to the infringement of autonomy, there are no grounds for awarding compensation for that head of damage.

 

                                                                                    Justice

.                      

                  

 

 

 

 

 

 

 

                       

 

 

"

 

 

 

 

 

 

 

 

said in subsection (b) into

account. 

 

C.A. 176/53

 

           

MORDECHAI ATIA

v.

MOSHE ROSENBAUM

 

 

In the Supreme Court sitting as a Court of Civil Appeal

[September 24, 1954]

Before Goitein J., Landau J., and Berinson J.

 

 

Tort - Factories Ordinance, 1946, s. 18(1) - Breach of statutory duty - Dangerous machinery - Failure to fence - Injury to employee - Liability of employer - Assessment of damages - Expectation of life - Loss of future earnings - Pain and suffering.

 

            The plaintiff was employed by the defendant to work an electrically-driven wool-teasing machine. On January 17, 1951 the plaintiff was cleaning the machine when his hand got caught and, before it could be released, was seriously injured. The plaintiff sued the defendant for damages for negligence and breach of the statutory duty to fence securely every dangerous part of any machinery or to provide the other safety measures set out in s. 18(1) of the Factories Ordinance, 1946.1⁾

           

            The Court of first instance, in dismissing the claim, held that there had been no breach of statutory duty because the employer had put the necessary fence on the machine and although there might be greater protection for the worker by use of a morticed lock, in fact no such lock was in use or available in Israel nor was it used to a great extent outside Israel.

           

            Held, allowing the appeal, that the duty to secure the safety of the employee was absolute, and that this duty was not discharged by employing a method by which the safety of the employee was in fact not secured although such method was the one generally employed.

           

                The appellant was awarded IL.15,000.- as damages for the injuries received.

           

Israel cases referred to:

 

(1) C.A. 70/52 Yehoshua Grossman and Egged Ltd. v. Henry Roth (1952), 6 P.D. 1242.

(2)   C.A. 62/53 Yehoshua Daum and Egged Ltd. v. Nissim Aharonof and Others (1954), 8 P.D. 128.

 

English cases referred to:

 

(3) Dennistoun v. Charles E. Greenhill Ltd.; [1944] 2 All E.R. 434.

(4) Davies v Thomas Owen and Company, Ltd.; [1919] 2 K.B. 39.

(5) Pugh v. Manchester Dry Docks Company, Ltd.; [1954] 1 All E.R. 600.

(6) Carroll v. Andrew Barclay and Sons, Ltd.; [1948] 2 All E.R. 386.

(7) Sutherland v. Executors of James Mills, Ltd.; [1938] 1 All E.R. 283.

(8) Harris v. Bright's Asphalt Contractors, Ltd.; [1953] 1 All E.R. 395.

(9) Roach v. Yates; [1937] 3 All E.R. 442.

(10) Rowley v. The London and North Western Railway Company; (1873), 29 L.T. 180.

(11) The "Swynfleet"; (1947), 81 Lloyd's List Law Reports 116.

 

Katz for the appellant.

Rotenstreich for the respondent.

 

BERINSON J. giving the judgment of the court. The appellant was employed as a labourer by the respondent, the owner of a wool factory for a period of about two months. During this time he was engaged in various tasks, including the operation of a wool-teasing machine.

 

            On January 7, 1951, the appellant was temporarily engaged in operating the machine in question. He started this work at 4 p.m. and at 8 p.m. he put his left hand into the machine while cleaning it. His hand was caught in one of the wheels of the machine and was severely injured.

           

            The appellant sued his employer under the Civil Wrongs Ordinance for damages in respect of the physical injury suffered by him, basing his claim upon two causes of action:

           

            (a) breach of the statutory duty imposed upon the employer by sections 10(1)1⁾ and 18(1) of the Factories Ordinance, 1946 relating to the illumination and fencing of dangerous machines in places of work:

           

            (b) negligence.

           

            The learned judge held that not only had the plaintiff failed to establish even one of the causes of action upon which he relied, but that it was his own negligence that had caused the accident. He therefore dismissed the claim. The appellant appealed to this court. Before us his counsel confined his submissions to one point alone, namely, the breach by the respondent of his statutory duty to fence the machine operated by the appellant - a duty imposed upon him by section 18(1) of the Factories Ordinance, 1946 (hereinafter called "the Ordinance"). That section provides as follows:

           

            "Every dangerous part of any machinery, other than prime movers and transmission machinery, shall be securely fenced unless it is in such a position or of such construction as to be as safe to every person employed or working on the premises as it would be if securely fenced:

 

            Provided that, in so far as the safety of a dangerous part of any machinery cannot by reason of the nature of the operation be secured by means of a fixed guard, the requirements of this subsection shall be deemed to have been complied with if a device is provided which automatically prevents the operator from coming into contact with that part."

 

            Before dealing with the accident itself, it is desirable that we have a clear picture of the machine involved in the accident and the way in which it works. We adopt the description of the learned judge in the court below who said:

           

            "I held an inspection in loco on two occasions. I examined the machine and found it to be composed of the following parts: 1) a table which oscillates while the machine is being operated; 2) a wooden cylinder at the end of the table; 3) a metal rod; (Note: there are in fact two metal rods, one above the other). 4) a cog wheel; 5) a guard above the cog-wheel.

 

            The method of operating the machine is as follows: the workman stands in front of the table and places the wool upon it. The wool is then conveyed towards him (by the oscillating table) from under the wooden cylinder, it enters the metal rod and is conveyed to the cog-wheel. The metal pivot is protected by a metal guard. The cog-wheel remains clean, but the wool accumulates under the metal rod and must be extracted from time to time with the help of a device called by the workmen a "hook".

           

            The machine is operated by electric power, the starter switch being situated close to it. To stop the machine completely, however, one operates another switch. situated about three meters from the machine. Even when the electric current is cut off, the machine continues to work - that is to say, the table still oscillates and the wheel, the rod and the cylinder continue to revolve for some seconds."

           

            This is the description given by the judge, to which must be added two important details which also emerge from the evidence:

           

            a) the table moves at a relatively slower speed than the cogwheel, which oscillates at a great speed. When the electric current is cut off, the various parts of the machine continue to move under their own power, but the table - which is a slow-moving object - comes to a stop before the cog-wheel which moves at a higher speed. A person unaware of these facts may therefore fall into error and think that when the table stops moving the wheel also stops. In fact however, the cog-wheel continues to revolve at a high speed for some time after the table has ceased to oscillate.

 

            b) The workman operating the machine stands facing it in front of the moving table. and in that position his hands - even when stretched straight out - do not reach the metal rods and also, therefore, do not reach the cog-wheel, which is even further away from them.

           

            How did the accident occur? The appellant was the only workman at the machine which stood in a room by itself. There was no eye-witness to the accident nor to what preceded it. The appellant stated in his evidence that on the day of the accident, at about 8 o'clock in the evening, the wool accumulated in the machine, and new material could not be served to it but kept flying back towards him. He therefore cut off the electric current by operating the two switches. and when the machine had stopped altogether he put in his left hand in order to clean away the wool. He did not see then that the cog-wheel was still turning since it was full of wool. and this wheel drew his hand inwards. The appellant added that the metal guard over the rods was not in position and that "had the guard been in position then, the wool would not have blown towards me and I would have been able to see the wheel". Under cross examination, however, he said that he could not remember if the guard was there at that time.

           

            The learned judge repeats the story of the appellant in his judgment, his only comment relating to the question of the metal guard. He says that he prefers the version of the respondent that the guard was in its place on the day of the accident, such version being supported by the clear evidence of the respondent and the works manager whose evidence on this point was unshaken.

           

            The remaining details in the appellant's story of the occurrence are not only uncontradicted by the other witnesses, but are in fact supported in the main by the witnesses Pessah Cohen and Simha Sverdlik. These witnesses, who are also workmen in the factory, were attracted to the scene by the cries of the appellant immediately after the accident, and it is they who dismantled the machine and removed the injured hand of the appellant. Moreover during one of the visits of the learned judge to the factory Sverdlik demonstrated the position in which he found the appellant after the accident and this demonstration coincided with the appellant's story. From all this it must be assumed that the learned judge accepted this portion of the appellant's evidence.

           

            The findings of the learned judge that the machine operated by the appellant is dangerous and that the metal rods were guarded on the day of the occurrence were not disputed before us. The real dispute, however, related to the question whether the guard conformed with the requirements of the law. The learned judge reached the conclusion that the respondent had discharged his duty by providing "reasonable means to make that portion of the machine safe". Counsel for the respondent, of course, supports this view of the matter while counsel for the appellant, in arguing against this finding, submits that reasonable means are not sufficient. Section 18(1) of the Ordinance requires, that the dangerous part of the machinery be securely fenced" or, in certain circumstances, that alternative means be taken to provide the same measure of safety. If, by reason of the nature of the operation, the safety of a dangerous part of the machinery cannot be secured by means of a fixed guard, it is necessary to provide what is called an interlocking guard. This device automatically prevents the operator of the machine from coming into contact with the dangerous part while it is in motion since the lifting of the guard in itself brings the machine to a standstill.

           

            The English courts1⁾, on the basis of a similar provision in the English statutes requiring safety in the operation of dangerous machinery, have held repeatedly over a period of decades that the duty of fencing machines securely is an absolute duty in the sense that the safety to be provided by the fencing must be absolute. In other words, the fencing must provide the workers who come into contact with the machine with an absolute guarantee that they will not be injured by it. The factory owner, therefore, does not discharge this duty even if he fences the dangerous machine in accordance with the best and most modern system known at the time if, in fact, the machine is not guarded thereby as the law requires (see Dennistoun v. Charles E. Greenhill Ltd. (3)). In the same way the factory owner does not discharge his duty if he does not provide the safety required for his workmen because to do so is technically impossible or commercially unfeasible. It has accordingly been held by the English courts that in cases such as these there is no alternative but to withdraw the machine from use. (Davies v. Thomas Owen and Company Ltd. (4), and Pugh v. Manchester Dry Docks Company, Ltd. (5).)

           

            In the case before us evidence was given by two labour inspectors who are responsible for ensuring compliance with the provisions of the Ordinance. They both stated that the guard over the metal rod is inadequate because it is possible to raise it while the machine is working without thereby stopping the machine. Both these experts stated, therefore, that there can be no absolute protection for the operator of this machine unless by means of an interlocking guard (by the raising of which the operation of the machine is stopped automatically, while it is impossible to set the machine in motion unless the guard is in position) although they had not demanded up to that time that such a guard be provided. The learned judge, however, did not accept these opinions but upon the evidence of the defendant and an expert engineer called Avni, who gave evidence on the defendant's behalf, he reached the conclusion that in providing the guard as it was, the defendant had taken reasonable steps to discharge his statutory duty. The defendant, who is very experienced in his profession, stated in evidence that he had visited many factories of the same kind in the country and that in not a single one had he seen an interlocking guard. He also said that "the guard must be free and flexible so that it can be raised with ease" - in other words, that in view of the nature of the work it is impossible to use a guard that is absolutely rigid. The engineer Avni also confirmed that the guard in the present case must be flexible, so that it can be raised in order to enable the wool to pass in accordance with the thickness of the material and that it is therefore impracticable to operate this machine with a morticed fence. He also stated that he had not seen such a fence on machines of this kind either in this country or elsewhere, and that only recently he had seen a modern machine of this type made in Belgium, and that even on that machine there had been no interlocking guard. On the basis of this evidence the judge concluded that the metal guard constituted reasonable protection, sufficient to satisfy the requirements of section 18(1) of the Ordinance, and that there is no necessity in this case for an interlocking guard in terms of the proviso to that section.

 

            It seems to us for more than one reason that the learned judge erred in his conclusion.

           

            In the first place it is clear that the metal guard does not allow for the machine to be "securely fenced". It moves up and down according to the amount of material which enters the machine, and sometimes it rises to such an extent as to enable the operator of the machine to put in his hand and reach the point between the two metal rods which revolve at a high speed (see the evidence of the labour inspector Stein and of the defendant). In other words, the guard does not constitute a reliable and fixed partition which would prevent a workman from coming into contact with the dangerous parts of the machine, and as long as this is so the requirement that the machine should be securely fenced has not been fulfilled (see, for example, the remarks of Lord Porter in Carroll v. Andrew Barclay & Sons Ltd. (6) at pp. 390-1). Moreover, when the metal guard is lowered it covers the metal rod and protects the workman from the cog wheel, but when it is raised - and there is no difficulty or impediment in raising it at any time - it exposes both of them, and there is then nothing to prevent the workman from coming in contact with them. This arrangement does not fulfil the requirements of section 20 of the Ordinance which provides, inter alia, that all fencing or other safeguards provided in pursuance of that Part, namely Part IV of the Ordinance, shall be constantly maintained and kept in position while the parts required to be fenced or safeguarded are in motion or in use, save in certain exceptional circumstances which are not relevant to the present case. In the case before us, as we have seen, it is possible to raise the guard with ease and expose the dangerous parts even when they are in motion, and we know from the story of the appellant that his hand was drawn towards the cog wheel while it was still in motion.

 

            In the second place, it is clear from the evidence of the respondent and the engineer Avni - which was accepted and relied upon by the learned judge - that because of the nature of the machine it is impossible to secure the safety of the workman from the metal rods. Their evidence was that the guard must be flexible and free, so as to be raised and lowered in accordance with the thickness of the layer of wool entering the machine. In this case, therefore, the proviso to section 18(1) of the Ordinance applies, in terms of which a device is to be provided which automatically prevents the operator from coming into contact with the dangerous part of the machine, viz., a device called an interlocking guard. There is no doubt that it is a matter of great, if not insuperable, difficulty to fix an interlocking guard to this type of machine. As we have already seen, however, there is no solution other than to fulfil the statutory obligation or to cease to use the machine. The fact that this machine has been used as it is in the respondent's factory and in other factories for a considerable time without any accident having occurred, and that the labour inspector did not demand an interlocking guard on this type of machine, is immaterial. See Sutherland v. Executors of James Mills, Ltd. (7).

           

            This brings us to the second question, namely, whether the appellant was negligent, and if it was his negligence which caused the accident. The learned judge found that the appellant well knew from the directions and instructions which he had received from the respondent and the Works Manager that the machine was to be cleaned by means of a hook, and not by hand, and that the appellant's negligence consisted in acting against this directive. The learned judge found additional negligence on the part of the appellant in his standing at the side of the machine instead of facing it - as he was obliged to do - and in his introducing his hand under the metal rod, although this part of the machine is always free of wool. Had there been some foundation in the evidence for the findings of fact upon which the judge based his conclusion of negligence we could not have interfered with that conclusion. However, after having examined and re-examined the evidence in its entirety, we have been unable to discover any basis for the findings of the learned judge. We shall deal with them separately.

           

            (a) The appellant acted against the directions and instructions which he received. In connection with this the respondent stated in evidence: "When the appellant started to work, I showed him how to clean the machine and I explained to him that the electric current must be stopped before the cleaning and that he must not touch any part of the machine as long as it is in motion... I told him that when the machine is already working he must only use the hook in order to clean it and must not use his hands...... The worker who operates this machine is the one who must clean it and he is not to rely on any one else to do it". And the Works Manager stated in evidence: "When it is desired to clean the machine it must be turned off. It is possible to remove the wool both with the hook and also by hand where there are no cogs... I told the plaintiff that it was forbidden to introduce the hand while the machine was in motion.. ."

           

            And what did the appellant do? He first turned off the electric current with both switches, and when it seemed to him that the machine was no longer in motion he started to clean it by hand. This was in accordance with the instructions given to him and not contrary to them. The appellant did not know that the cog wheel continues to move for some little time after the current is turned off, and there was no evidence that instructions were given to him not to approach the machine for some time after the current had been turned off.

 

            (b) The appellant stood at the side of the machine at a time when he should have stood facing it. It is true that the appellant stood at the side of the machine while he was cleaning it, and not facing it, but according to all the evidence he was not obliged to stand facing the machine at that time. It is only while the machine is in motion and the workman is operating it or cleaning it with a hook, that he is obliged to stand facing it. When, however, he has to clean it by hand after it has ceased to operate, he is obliged to stand to one side, otherwise his hand cannot reach the machine at all.

           

            (c) The appellant introduced his hand underneath the metal rod, although that part of the machine is always clear of wool. In point of fact the appellant did not introduce his hand into that portion of the machine. The eye-witnesses, Pessah Cohen and Simha Sverdlik, who helped to extract the appellant's hand from the machine immediately after the accident, stated clearly that "the hand was caught between the big cylinder and the cogs" and that "he held his hand above the cylinders between the drum (that is to say, the cog wheel) and the upper cylinder (that is to say, the rod)..."

           

            It is clear, therefore, that there is no proof of negligence on the part of the appellant which caused the accident. The accident was caused in fact by the breach of the statutory duty imposed upon the appellant relating to the fencing of the machine.

           

            The plaintiff, in his Statement of Claim, claimed damages in an inclusive sum of I.L. 17,000.- Of this amount I.L. 500.- were claimed as special damages for loss of past wages, that is to say, from the date of the accident, January 7, 1951, until the date of the institution of action, July 1, 1952, less the amount received by him until then, and general damages in an amount of I.L. 16,500.-.

           

            In the course of argument before the District Court counsel for the plaintiff amended this account and argued that on the basis of the evidence led by him his client was entitled to damages for loss of wages until that date (April 1, 1953) in an amount of I.L. 1,534.-. In this court counsel for the appellant again amended the account for damages and in his written argument filed in this court on June 10, 1954, claimed an amount of approximately I.L. 4,000.-. He based his claim for this sum on his client's total inability to work during the whole period, and he argued that this amount should be awarded to his client in full as the actual loss which he had sustained for the period which had already passed, as special damages.

 

            It is clear that this contention is erroneous. Special damages must be proved in a trial as the actual loss or expense sustained by the plaintiff until the date of his claim or, at the latest, until the date upon which the case is heard. All other loss, expense, or damages which are anticipated in the future form a portion of the general damages.

           

            The learned judge dealt with the question of damages only to meet the eventuality of an appeal, and he expressed the opinion that the loss of past wages should be assessed in the amount of I.L. 500.-and that the claim for general damages in the amount of I.L. 16,500.-should be dismissed for lack of proof.

           

            We do not think it would be right in this case to vary the amount awarded by the learned judge in respect of damages for loss of past wages - down to the date of the institution of the action - in the sum of IL. 500.-, since this is the sum which was claimed by the plaintiff in his Statement of Claim, and he did not claim that damages under this head should be calculated until the date of the hearing of the case.

           

            We turn now to the question of general damages. The plaintiff in his Statement of Claim did not claim the general damages claimed in the amount of I.L. 16,500.- under the two heads of damage of which they are composed, namely, loss of wages or profits in the future, and pain and suffering. Only in the course of argument in the District Court was it stated by counsel for the plaintiff that, in accordance with the accepted standard in the courts of this country in such matters, it was in his opinion proper to fix the amount of damages for pain and suffering caused to the plaintiff at I.L. 5.000.-and damages for loss of wages from the date of the institution of action until the end of the plaintiff's life in the amount of I.L. 11,500.-as was done in the case of Grossman & Egged Ltd. v. Henry Roth (1) and the case of Daum & Egged Ltd. v. Aharonof (2).

 

            As far as damages for pain and suffering are concerned it seems to us that the damage in this case is less serious than in that of Grossman, in which the damages awarded were fixed at I.L. 5,000.-and in that of Daum, in which the greater part of the sum of nine thousand two hundred and thirty pounds was awarded. In Gross man's case the left hand of the injured man was amputated completely leaving only a stub the length of which was 16 cm. In the case of Daum the victim suffered severe injuries to his head and remained with a deep hollow in his forehead. After an operation and lying in hospital for twenty-six days, a further period of five months elapsed before he started any work at all. He lost his sense of taste and his sense of smell, and at times even his sight was affected. The doctors were also of opinion that it was possible he would become epileptic as a result of the accident. It is true that in the case before us the appellant lay in hospital on more than one occasion and underwent four operations in the course of nine months, and that after all this he remained with a permanent disability in his hand. The hand itself, however, was not amputated, although it has remained patently deformed. Having regard to all the circumstances of the case it seems to us that an amount of I.L. 4,000.-is a reasonable sum of damages under this head.

 

            It remains to consider the measure of damages to be awarded for loss of ability to work in the future. There is no rigid rule to be applied to this matter and the court will assess these damages to the best of its judgment having regard to all the circumstances and the factors affecting the case before it. As a general rule the court must assess "how much the injured man would have earned but for his disability and how much he is likely to earn with his disability" during the rest of his life, and must determine the damages upon the basis of the difference between these two amounts. See Grossman's case (1).

           

            It follows that the learned judge was correct in saying that it was for the plaintiff to prove his age and his prospects of living in order to estimate thereby his expectation of life. We are not however, in agreement with the conclusion of the learned judge that the plaintiff's prospects of life were not proved.

           

            It is true that these two elements, namely, the age of the plaintiff and the length of life which he could be expected to live were not mentioned in his Statement of Claim. The plaintiff stated in evidence, however, that he is twenty one years of age and that he completed his army service with medical category "A" about three months before the accident. Counsel for the defendant did not object to this evidence at the time nor did he bring any evidence to contradict it. In these circumstances there was nothing to prevent the learned judge from accepting the age of the appellant and his state of health in general, as facts which had been proved.

 

            What, however, is the appellant's expectation of life for the purpose of assessing general damages? No positive evidence on this point was adduced, but in his argument before the lower court, counsel for the plaintiff relied upon the statistical tables published in Bingham's book on Claims in Vehicle Cases, second edition, p. 372, and on the Israel Statistical Monthly, from which it appears that the average expectation of life of a normal man of twenty one years of age in England and in Israel is about 45 years. The learned judge, however, apparently following an obiter dictum of Cheshin J. in Grossman's case (1), paid no attention to all this and did not even mention it in his judgment. In our opinion once the judge had seen the plaintiff in the witness box and his age and state of health were known to him, there was no reason not to estimate the expectation of life of the plaintiff - upon the basis of his general knowledge of the average and usual length of life of the inhabitants of this country. It has been an accepted practice in the courts of England in recent times to estimate the expectation of life of a plaintiff upon the basis of their general knowledge and experience without any additional positive evidence. (See Harris v. Bright's Asphalt Contractors Ltd. (8), and Roach v. Yates (9).)

           

            That is also the law in the United States, as appears from Sherman and Redfield on Negligence, Revised Edition (1941), vol. 4, p. 1972, in which the following two cases are cited:

           

            "Where the plaintiff was personally present held that the jury might judge her life expectancy without any other evidence on the subject."

           

            "Where the evidence discloses the age and health of the deceased, it is competent for the jury to estimate his probable duration of life without the assistance of mortality tables".

           

            After all, every case of the possible expectation of life of a particular person is in the realm of conjecture, even after consideration of tables of life and mortality, and evidence of experts regarding them. In the absence of special circumstances pointing to the necessity of departing from the general rule in respect of any particular person, the expectation of life of an ordinary man must be assessed according to the average that is proved in the case or which is determined by the court upon the basis of its own knowledge and personal experience.

 

            "If there are special considerations such as these, the party who relies upon them to reduce the period of life must prove that they exist." See Rowley v. The London & North Western Railway Company (10), at p. 184.

 

            In the present case the respondent has not established the necessity of departing from the general rule in the case of the appellant. It seems to us, therefore, that it would be right to fix his future expectation of life at 40 years.

           

            As far as the wages of the appellant at the time of the accident - and thereafter - are concerned, it has been proved that his daily wage at the time of the accident was I.L. 1.659.- and that the daily wage of a healthy workman of the type of the appellant at the time of the institution of action in July, 1952, had risen to I.L. 4.333. When this evidence was heard in January 1953, the daily wage was I.L. 4.854. As is known, wages in general have continued to rise, regularly and continuously, but since we must take into account a length of life of 40 years which the appellant may expect from July, 1952, and that there may be in the course of that time both rises and falls in the wages which can by no means be anticipated, it seems to us that we are entitled to assume, on the basis of the position of today, that were it not for the appellant's disability he would in the course of the whole period mentioned earn an average of I.L. 5.- per day, together with the rises and increments which he would receive as a result of expert knowledge and progress in his work which would increase with time.

 

            In view of the judgment in the case of The "Swynfleet" (11), it is clear that in fixing the estimated wage which would be earned by an injured man for the rest of his life were it not for the accident, we are not entitled to disregard the general changes which operate in the meantime on the wages of workmen of the same type as the injured man. We must take them into account as the basis of our assessment in place of the actual wage earned by the injured man at the time of the accident. In that case the damages payable to the family of two workmen in a French ship who lost their lives when the ship sank as a result of a collision with the British ship "Swynfleet" in December 1939, fell to be considered. By reason of the second World War the matter came to trial only in 1947, and a number of major changes in the wage of shipworkers of the type of the two deceased persons (and also in the rate of exchange between the French franc and the pound sterling) had taken place in the meanwhile.

 

            The court held that in assessing the damages payable to the families of the victims the wage which the victims would have earned had they remained alive until the hearing of the case was to be taken into account. In so holding the court based itself upon the principle that damages must replace what the deceased would have given his family had he remained alive and continued to support them. The same principle applies in the case of bodily injury in which case, too, the damages must compensate the injured man as far as possible for the anticipated loss which was caused to him by his injury. Since we know today, more than three and a half years after the occurrence, what has happened in the meantime in regard to wages generally, we must make use of this knowledge and not be content with considering the state of affairs that existed at the time of the accident as if nothing had happened since.

           

            It is more difficult to assess what the appellant is likely to earn, with his disability, for the remaining portion of his life. More particularly is this so since up to the date upon which he gave evidence he had not yet succeeded in obtaining any kind of work, despite continuous efforts to do so, nor has it been proved what his prospects of work are in the future. In the absence of any other criterion, we may derive assistance from the evidence of the doctors who stated that the appellant - as a result of the accident - suffered at least a thirty-five per cent disability in his capacity to engage in physical labour, and take this finding as a measure of his loss of wages. On the basis of I.L. 5.- per diem and an average of 300 working days per annum for a period of forty years, the loss - at the rate of 35 per cent of this sum - amounts to I.L. 21,000.-. Taking into account that the appellant will receive his damages in one lump sum instead of in weekly payments, and also having regard to the other factors and occurrences which may operate to reduce his income (sickness, unemployment, and other expected and unexpected eventualities), we fix the sum of damages under this head at half the estimated loss, namely, the sum of I.L. 10,500.-.

 

            In conclusion there remains the argument of the respondent that in view of the provisions of section 62 of the Civil Wrongs Ordinance, 1944, the appellant is precluded from bringing his present claim for damages since he has received damages for a year and a half under the Workmen's Compensation Ordinance. We see no substance in this submission.

           

            Section 62 of the Civil Wrongs Ordinance provides as follows:

           

            "Notwithstanding anything contained in the Workmen's Compensation Ordinance or any enactment as to workmen's compensation in force in Palestine for the time being, no workman (which term, for the purpose of this section, shall be deemed to include his dependants) shall, by reason of the happening of any event, recover from his employer both compensation under the provisions of this Ordinance and compensation under the provisions of the Workmen's Compensation Ordinance or such other enactment for any injury or damage caused by such event.

 

            For the purposes of this section, the expression 'dependents' has the same meaning as it has in section 2(1) of the Workmen's Compensation Ordinance."

 

            It is not disputed that the appellant received from the respondent and his insurance company various sums amounting to I.L. 647.- which were paid to him regularly from February, 1951, until June, 1952. These sums however were not payments of damages under the Workmen's Compensation Ordinance, and in the receipts signed by the appellant (which were submitted to the court) it is merely said that the amounts in question were paid "in respect of damages" without stating whether they were paid under the Workmen's Compensation Ordinance or The Civil Wrongs Ordinance. It was also not proved in evidence that the injured man knew and agreed to receive this money as damages under the Workmen's Compensation Ordinance.

           

            The result is that we allow the appeal, set aside the judgment of the District Court, and award to the appellant an amount of damages of fifteen thousand pounds as follows:

           

For loss of past wages                                     I.L.    500.-

For pain and suffering                                                I.L.   4000.-

For loss of wages in the future                       I.L. 10500.-

Total                                                                            I.L. 15000.-

 

            We also award costs against the respondent both in this court and in the District Court together with an inclusive amount of I.L. 200-. as counsel's fees in both courts.

           

Appeal allowed, and damages awarded to the appellant in the sum of I.L. 15,000.-.

Judgment given on September 24, 1954.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

starting with traffic court, and reaching where he has. His contribution covers all areas of the law, and there is no valley in which he did not stake a claim. The judgment he chose for his retirement day is characteristic of the central field of his judicial legacy, the field of torts, and within it medical negligence. For many future years the mark which Justice Rivlin has made on all branches of tort law, from traffic accident law, regarding which he also wrote a fundamental book, to the complex and sensitive issue decided today, will accompany Israeli adjudication. According to the sages, the existence of fair tort law – relations between man and his fellow (Babylonian Talmud Baba Kama 30a) – is among the foundations of just human society. In his judicial work, Justice Rivlin contributed to that. I wish him, now that he has reached retirement age, that "in old age they still produce fruit; they are always green and full of sap" (Psalms 92:14).

 

 

Decided according to the opinion of the Deputy President E. Rivlin.

 

The result of the judgment – to the extent that it regards the annulment of the cause of action of the infant – shall not apply to pending cases (including cases before us) in which an action was not submitted by the parents. Justice E. Rubinstein was of the opinion that the result of the judgment should not be applied for one year from today, and Justice M. Naor notes that the question of the law regarding a claim on the part of an infant which has not yet been submitted should not be decided in the framework of a transitional provision in the case before us.

 

Given today, 7 Sivan 5772 (28 May 2012).

 

C.A. 461/62

 

               

ZIM ISRAEL NAVIGATION CO. LTD. and Another

v.

SHOSHANA (ROSA) MAZIAR

 

 

 

In the Supreme Court sitting as a Court of Civil Appeal

June 26, 1963

Before Silberg J., Landau J. and Witkon J.

 

 

 

Contract - validity of exemption clause in ship-passenger ticket – public policy.

 

               

During a voyage between Marseilles and Haifa, the respondent fell ill, apparently from food she had eaten on board, and for three months after arriving in Israel suffered from a stomach infection. She sued the ship owners and the ship's chef for negligence. The appellants pleaded in defence inter alia the exemption clause relieving them from liability which appeared in the passenger ticket sold to the respondent. The District Court found for the respondent on the ground that res ipsa loquitur and held that the exemption clause was null and void.

 

Held. As between the English approach which was cautious in annulling exemption clauses outright, balancing public policy against the freedom of contract, and the American approach which struck down such clauses either because of the absence of real voluntary consent to their inclusion or because of public policy, the latter was to be followed. In so doing Israeli law would not be adopting some alien "creature" but applying in the area of law principles of Jewish ethics which prized human life and well-being highly and giving the concept of public policy a specific Jewish content. All this was warranted by local statutory provision which made contracts contrary to public order and morality unlawful. Generally, the matter raised the whole question of standard contracts and called for legislative regulation.

 

Per Witkon J., it was questionable whether the invalidation of exemption clauses would raise the standard of care expected from the parties concerned in any significant manner. It would be better to impose absolute liability, regardless of fault, and leave it to carriers to cover themselves by insurance. That would also spread the cost among the travelling public at large and ensure that persons injured by some mishap were not left remedyless.

 

Israel cases referred to:

 

(1)          C.A. 136/56 - Slavko Fox v. Ilan & Etzioni Ltd. (1957) 11 P.D. 358

(2)          C.A. 99/59 - "Shoham" Maritime Services Ltd. v. Ephrayim and Alfreda Feiner (1960) 14 P.D. 1451.

 

English cases referred to:

 

(3)          Redhead v. Midland Rly Co. (1869) 20 L.T. 628.

(4)          Luddit v. Ginger Cove Airways (1947) 1 All E.R. 328: (1947) A.C. 233.

(5)          Peek v. Directors etc. of N. Staffordshire Rly. Co. 11 E.R. 1109 (1863).

(6)          Thompson v. London, Midland and Scottish Rly. Co. (1930) 1 K.B. 41.

(7)          Gibaud v. Great Eastern Rly. Co. (1920) 3 K.B. 689.

(8)          Adler v. Dickinson (1954) 3 All E.R. 397;(1955) 1 Q.B. 158.

(9)          Beaumont-Thomas v. Blue Star Line Ltd. (1939) 3 All E.R. 127.

(10)        Sze Hai Tong Bank Ltd v. Rambler Cycle Co. Ltd. (1959) 3 All E.R. 182; (1959) A.C. 576.

(11) J. Spurting Ltd. v. Bradshaw (1936) 2 All E.R. 121.

(12) Printing etc. Co. v. Sampson (1875) 32 L.T. 354.

 

American cases referred to:

 

(13) The Kensington 183 U.S. 263 (1902).

(14) Baltimore & Ohio Southwestern Rly. Co. v. Voigt 176 U.S. 498 (1900).

(15) New York C.R. Co. v. Lockwood 21 L. ed 627.

(16) Oceanic Steam Navigation Co. v. Corcoran 9 F (2nd) 724 (1925).

 

G. Gordon for the appellant.

P. Maoz for the respondent.

 

SILBERG J.                           This is an appeal against a judgment of the Tel Aviv-Yaffo District Court ordering the appellants to pay the respondent a sum of IL 720 together with interest and costs for injuries sustained by her on a voyage from Marseilles to Haifa.

 

2. It seems that the parties would have reached a settlement but for the baneful fact that the ticket which the respondent bought from the first appellant, a shipping company, contains an exemption clause releasing the company and its employees from all responsibility for injury to the respondent, financial and physical, and the learned judge in an interim judgment declared this clause to be null and void as offending against public order or morality in accordance with section 64(1) of the Ottoman Civil Procedure Law. Hence the keen struggle which Zim has waged against the judgment that requires it to pay the trivial sum above-mentioned.

 

                Let us therefore first examine this important basic question and then, if we find that the exemption clause is in fact unable to exempt, turn to the facts as found by the learned judge regarding the actual negligence of the two appellants.

               

3. Upon deciphering the faulty Hebrew of the exemption clause, we gather that the company and its employees is not to be responsible for any evil that may befall a passenger, be it death, physical injury or financial loss, even if caused by an act of one of the ship's crew and all the more so if "only" the result of negligence. The company declares in the clause that it does not give "any condition of liability or guarantee" regarding "the religious purity, grade, condition, quality or quantity of any food, beverage or medicine" which the passenger might take. That is to say, not only may the food be bad but even any medicine administered to a passenger to counteract the bad food may also be bad. The clear meaning of the entire clause is that a passenger, affected in his body or property by the adventures of a voyage in one of the company's ships, can have no recourse to any law or court.

 

                The question is whether effect should be given to such a draconian clause.

               

4. The legal validity of exemption clauses in contracts of carriage has been discussed in the English decisions at length. The result has been that the strictness with which the matter was originally treated has given place to a more lenient approach. The responsibility of a general (as against a private) carrier and in particular a general carrier of goods (as against a carrier of passengers) was at one time very severe indeed; it covered all injurious events apart from those due to force majeure or enemy action: Readhead v. Midland Rly. Co. (3); Luddit v. Ginger Coote Airways (4). The larger companies therefore began to seek for some "medicament" against the ills of statute and case law, and with the assistance of the wise counsel of erudite lawyers introduced into their contracts of carriage and bills of lading exemption clauses, usually in illegible small print. By such puny-lettered clauses a company would take itself out of the statute and free itself as it desired from the legal responsibility which might threaten it from careless or negligent treatment of the object of the contract. The prospective customer stood helpless and impotent in the face of these clauses. Normally he was not even aware of their presence or had not read them at all and even if he had, did not understand them since few can plumb the mysteries of legal terminology. And should it wondrously happen that the clause was plain and he had read and understood it, there was no option but to accept it since the only alternative was to forgo the journey or the consignment of the goods.

 

5. The attitude of the English courts towards exemption clauses was at first suspicious and cautious. Exactly a hundred years ago in the famous decision of the Court of the Exchequer in Peek v. North Staffordshire Rly. Co. (5) Blackburn J. said that although according to the cases decided between 1832 and 1854 a carrier could make a contract exempting him from all responsibility for damage even if caused by the gross negligence or fraud of his servants, the (Canal Traffic) Act of 1854 changed the situation. The purpose of this Act was to prevent companies "from evading altogether the salutory policy of the common law." ... For this reason he denied validity to an exemption clause which in his opinion was not "just and reasonable". The House of Lords - for various reasons which we need not enter into here - in a majority judgment set aside the decision of the Court of Exchequer but each of the judges supported the view that the conditions of an exemption clause must be just and reasonable, otherwise no benefit can be derived from it.

 

6. Even some 75 years later echoes are still heard in the courts of the doctrine which continues to disregard justness or reasonableness. Thus for instance in Thompson v. London, Midland and Scottish Rly. Co. (6) Lord Lawrence expressed the view that if an exemption clause in a railway ticket is unreasonable, the passenger would not be bound by it. Sankey J. agreed with this view and announced that if the document referred to "imposed such unreasonable conditions that nobody could contemplate that they exist", the passenger would not be deemed bound by them (at pp. 390, 391).

 

                Sankey J.'s observation gives some little opening to the necessity for reasonableness. An unreasonable condition is a "hidden" undisclosed condition and the exemption it accords does not bind the passenger.

               

                A similar notion, but still not very clear, was developed in Gibaud v. Great Eastern Rly. Co. (7) in which Bray J. said:

               

"Every contract is voidable by fraud, and if the condition is so irrelevant or extravagant that the party tendering the ticket must have known that the party receiving it could never have intended to be bound by such a condition, then I should say that the assent of the party receiving the ticket was obtained by fraud, and he would not be bound."

 

But a few lines below he went on to add:

 

"In my opinion, once it is found that a party has expressly or by his conduct assented to the condition, he is bound by these conditions ... and it is no answer to say that they are unreasonable, unless he can prove that his assent has been obtained by fraud."

 

                This is essentially inconsistent. On the one hand, every unreasonable condition is ipso facto a condition obtained by deceit and fraud. On the other hand, the defence of unreasonableness cannot be raised unless deceit and fraud is proved. I wonder whether these two propositions can exist side by side.

               

7. But these ideas which combine unreasonableness and "hiddenness" had their effect and ultimately destroyed the whole doctrine of reasonableness. This doctrine presented in such an attractive form by Blackburn J. in the first Peek decision - that the use of unreasonable exemption clauses frustrates and defeats "the salutory policy of the common law" - became increasingly blurred until it vanished without trace. It was so closely swathed that it ceased to breathe. For if the emphasis is upon the cognitive knowledge of the person purchasing a ticket, then formal reference on the face of the ticket, in red ink, to what is contained in one or another of the "small print" conditions is sufficient to evidence the actual or constructive knowledge of the purchaser so as to render the exemption clause valid, whatever its reasonableness or justness.

 

                This is what Lord Denning said in his new and novel judgment in Adler v. Dickson (8). There a ship passenger was seriously injured by falling off the gangway from a height of 16 feet upon reembarking in Trieste. She sued the ship's master and boatswain and not the shipowners themselves, fearing the effect of an exemption clause in her ticket. One of the defences was that if the shipowners' employees were made personally liable to pay damages, the very purpose of the exemption clause would be defeated.

 

"I pause to say that, if a way round has been found, it would not shock me in the least. I am much more shocked by the extreme width of the exemption clause which exempts the company from all liability whatsoever to the passengers. It exempts the company from liability for any acts, default or negligence of their servants in any circumstances whatsoever, which includes, I suppose, their wilful misconduct. And this exemption is imposed on the passenger by a ticket which is said to constitute a contract but which she has no real opportunity of accepting or rejecting. It is a standard printed form on which the company insist and from which they would not depart, I suppose, in favour of any individual passenger. The effect of it is that, if the passenger is to travel at all, she must travel at her own risk. She is not even given the option of travelling at the company's risk on paying a higher fare. She pays the highest fare, first class, and yet has no remedy against the company for negligence. Nearly one hundred years ago Blackburn J., in a memorable judgment, said that a condition exempting a carrier wholly from liability for the neglect and default of their servants was unreasonable... . I think so too."

 

These incisive observations of a foremost judge such as Lord Denning would lead us to expect that like Blackburn J. he would also pronounce the exemption clause null and void. A contractual condition, shocking in its wickedness, is not worthy of solemn statutory warrant, for can we truly desire that the curse of "in the place of justice, wickedness exists" (Eccl. 3:16) should befall us? But Lord Denning thought otherwise since he regarded himself bound by the recent English case law in the matter. And so he continued

 

"Nevertheless, no matter how unreasonable it is , the law permits a carrier by special contract to impose such a condition: see Luddit v. Ginger Coote Airways Ltd. (4): except in those cases where Parliament has intervened to prevent it. Parliament has not so intervened in the case of carriers by sea (emphasis added). The steamship company are, therefore, entitled to the protection of these clauses, as indeed this court held in Beaumont-Thomas v. Blue Star Line Ltd. (9)."

 

It should be noted that in Luddit the journey was not by sea but by air, but sea and air are the same thing, neither being land. But the very distinction between land travel on the one side and air and sea travel on the other is not very logical. Can we draw any conclusions from the fact that in Blackburn J's time no one dreamed of jet airplanes such as the Boeing 707? It is true that section 7 of the 1854 Act, on which Blackburn J. relied, deals with land carriers, but the idea which that judge culled from it against unreasonable exemption clauses for "... marring the salutory development (that is, the progress) of the common law" is a general moral idea. And if that is so, it applies in equal measure to all forms of carriage, since what difference is there between them? I would almost say that those who follow the Blackburn doctrine are prepared to apply it also to contracts which are not contracts of carriage at all, witness the example of unreasonableness given by Sankey J. in Thompson (6) (at 44).

 

8. The English judges have apparently felt uncomfortable with a punctilious use of extreme exemption clauses; they shocked Lord Denning and he therefore tried to sweeten the pill by another "help¬mate" by a personal touch and extending appreciably the well-known qualification of fundamental breach: Sze Hai Tong Bank Ltd. v. Rambler Cycle Co. Ltd. (10).

 

                In that case a bicycle manufacturer sent its products by steamship to Singapore for sale to its regular customers there. The bill of lading was made out to the order of the seller and indicated the name and address of the prospective buyer. The bill of lading stated that the responsibility of the carrier would cease absolutely after the goods were discharged from the ship. The goods were discharged but the carrier's agents released them not to the seller or to its order under the bill of lading but to the buyer without receiving the price on an indemnity given to the carriers by the buyers' bank. In an action between the bank and the manufacturer arising out of the indemnity the question arose whether the carrier was liable to the manufacturer for the loss in view of the exemption clause in the bill of lading. Lord Denning answered this question in the affirmative. saying

 

"If the exemption clause, on its true construction, absolved the shipping company from an act such as that, it seems that, by parity of reasoning, they would have been absolved if they had given the goods away to some passer-by or had burnt them or thrown them into the sea. If it had been suggested to the parties that the condition exempted the shipping company in such a case. they would both have said: 'Of course not'. There is, therefore, an implied limitation on the clause, which cuts down the extreme width of it; and, as a matter of construction, their Lordships decline to attribute to it the unreasonable effect contended for. But their Lordships go further. If such an extreme width were given to the exemption clause, it would run counter to the main object and intent of the contract. For the contract, as it seems to their Lordships, has, as one of its main objects, the proper delivery of the goods by the shipping company, 'unto order or his or their assigns', against production of the bill of lading. It would defeat this object entirely if the shipping company was at liberty, at its own will and pleasure, to deliver the goods to somebody else, to someone not entitled at all, without being liable for the consequences. The clause must, therefore, be limited and modified to the extent necessary to enable effect to be given to the main object and intent of the contract."

 

The great and broadening novelty of this judgment is the construction of "implied conditions" which reduce the excessive scope of the exemption clause (cf. Spurling v. Bradshaw (11) at pp. 124-25).

 

                Without criticising Lord Denning for containing the jungle of wild exemption clauses, it seems to me, however, that it is at least possible to apply the idea to those clauses also which exempt a carrier for bodily injuries, since is it not possible to "infiltrate" here as well some implied condition to the effect that a carrier assumes the obligation to carry the passenger to his desired destination in hale and hearty condition? The loss of a limb at sea defeats the main purpose of a passenger ticket no less than the delivery to another of goods after discharge defeats the main object of the bill of lading.

               

 9. The approach of the American courts co this question is different. American case law is far more audacious. It does not maintain the plaintive conservative view marked by the lip service of moral indignation on the one hand and resignation co the existing situation on the ocher. The prevailing view in American case law has for a very long time been that a clause exempting a carrier from all liability for his own acts and those of his agents and servants is null and void, either because it lacks in truth the element of willing agreement or because it is contrary to public policy.

 

                Appellants' counsel submitted that the laurel for this liberal doctrine rests on the American legislature and not the courts, but it is not so. In the United States things took the opposite course, the case law preceded legislation and section 1 of the Harter Act of 1893 which makes it unlawful for a carrier to insert in a bill of lading any clause exempting him from liability for damage arising out of negligence, fault or omission (and if inserted, makes it null and void) merely put the statutory seal on a very wide¬spread principle already existing.

               

                Moreover, legislation not only did not give birth to the case law but also did not affect or narrow it (except as expressly provided therein), witness the fact that wherever one cannot rely on the Harter Act because it does not regulate the matter - for instance, in connection with personal injuries co passengers - the courts have applied the much broader pre-Harter rule.

               

"It is settled in the courts of the United States that exemptions limiting carriers from responsibility for the negligence of themselves or their servants are both unjust and unreasonable, and will be deemed as wanting in the element of voluntary assent; and, besides, that such conditions are in conflict with public policy. This doctrine was announced so long ago, and has been so frequently reiterated, that it is elementary... .

 

True it is that by the act of ... 1893 ... known as the Harter Act ... the general rule just above stated was modified so as to exempt vessels, when engaged in the classes of carriage coming within the terms of the statute, from liability for negligence in certain particulars. But while this statute changed the general rule in cases which the Act embraced, it left such rule in all other cases unimpaired. Indeed, in view of the well-settled nature of the general rule at the time the statute was adopted, it must result that legislative approval was by clear implication given to the general rule as then existing in all cases where it was not changed" (The Kensington (13) at pp. 268-69).

 

10.          Why did American Common law "rebel" against its begetter, English Common law, and what ideological basis was there for this change of position? There were two reasons: first, the exceeding concern of American judges for human life and personal safety; second, the profound abhorrence of the social phenomenon of the grinding down of the small man by the large corporations. These are not vague fancies or empty phrases. The ideas they emody are clearly formulated in a Supreme Court judgment at the outset of the present century: Baltimore & Ohio S.W. Co. v. Voigt (14).

 

                This case concerned a passenger injured in a railway accident. The victim was an express messenger who frequently travelled between Cincinnati and St. Louis as an official of the express company, accompanying express parcels, under special contract between the company and the railway. One of the terms of his employment was that he would waive - and indeed did waive - every claim against the railway for injury sustained by him whilst accompanying parcels. The question was whether he should be regarded as a "passenger" in respect of the general rule that treats as a nullity any condition exempting a carrier from liability for injury caused to passengers. In the course of the hearing, the Court explained the scope and reasons of the general rule.

               

                Because of the inherent importance of the ideas voiced in this judgment, it is proper to cite from it in extenso. Justice Shiras brings to light the differences between the English and American judiciary over exemption clauses of carriers. He mentions, on one side, a number of American judgments (of inferior courts) which propound the nullity of such clauses on account of public policy; and then he cites, on the other side, the dictum of Sir George Jessel, that rejects the public policy of avoiding the clauses in favour of "the paramount public policy" of freedom of contract (Printing ... Co. v. Sampson (12) at p.465). Justice Shiras proceeds to ask what principles the American judges chose in dealing with the cases before them.

               

"They were mainly two. First, the importance which the law justly attaches to human life and personal safety, and which forbids the relaxation of care in the transportation of passengers which might be occasioned by stipulations relieving the carrier from responsibility. This principle was thus stated by Mr. Justice Bradley in the opinion of the court in the case of New York C.R. Co. v. Lockwood (15):

 

'In regulating the public establishment of common carriers, the great object of the law was to secure the utmost care and diligence in the performance of their important duties - an object essential to the welfare of every civilized community. Hence the common law rule which charged the common carrier as an insurer. Why charge him as such? Plainly, for the purpose of raising the most stringent motive for the exercise of carefulness and fidelity in his trust. In regard to passengers the highest degree of carefulness and diligence is expressly exacted.'

 

The second fundamental proposition relied on to nullify contracts to relieve common carriers from liability for losses or injuries caused by their negligence is based on the position of advantage which is possessed by companies exercising the business of common carriers over those who are compelled to deal with them. And again we may properly quote a passage from the opinion in the Lockwood Case as a forcible statement of the situation:

 

'The carrier and his customer do not stand on a footing of equality. The latter is only one individual of a million. He cannot afford to haggle, or stand out and seek redress in the courts. His business will not admit such a course. He prefers, rather, to accept any bill of lading, or sign any paper the carrier presents: often, indeed, without knowing what the one or the other contains. In most cases he has no alternative but to do this or abandon his business... .

 

If the customer had any real freedom of choice, if he had a reasonable or practicable alternative, and if the employment of the carrier were not a public act, charging him with the duty of accommodating the public in the line of his employment, then, if the customer chose to assume the risk of negligence, it could with more reason be said to be his private affair, and no concern of the public. But the condition of things is entirely different, and especially so under the modified arrangements which the carrying trade has assumed. The business is almost concentrated in a few powerful corporations, whose position in the body politic enables them to control it.... These circumstances furnish an additional argument, if any were needed, to show that the conditions imposed by common carriers ought not to be adverse (to say the least) to the dictates of public policy and morality.' "

 

                This is indeed a powerfully expressed description - uncommon in any legal literature - of the small man's dependency, standing, as he does, powerless before the mighty machine of profit which crushes him into the dust. Justice Shiras, adopting these ideas, thus formulates accordingly the policy of American case law:

               

"1. That exemption claimed by carriers must be reasonable and just, otherwise they will be regarded as extorted from the customers by duress of circumstances, and therefore not binding.

2. That all attempts of carriers, by general notices or special contracts, to escape from liability for losses to shippers, or injuries to passengers, resulting from want of care or faithfulness, cannot be regarded as reasonable and just, but as contrary to a sound public policy, and therefore invalid" (at pp. 505-507).

 

                In another judgment, the Circuit Court of Appeals in New York (Oceanic Steam Navigation Co. v. Corcoran (16) at 732) cites with approval Shearman and Redfield on Negligence (6th ed.) vol. 2, para. 505c:

               

"In the federal courts, and in Connecticut, Indiana, Wisconsin, Iowa, Missouri, Texas, Utah, Virginia, Michigan, Vermont and other states it is held that such a contract (exempting from liability) as to any degree of negligence is void, at least against a passenger giving any compensation for his journey, because it tends to cheapen human life, and to remove the most efficient guarantee which the Common law has given to society against destruction of its members by negligence... . The state has an interest of the highest degree in the preservation of its citizens' lives, and experience demonstrates that there is no practical safeguard against the destruction of those lives by negligence, except in private actions by the persons injured, or their representatives. The protection thus afforded to the individual is therefore of such value to the state that it should not allow it to be waived."

 

                The theme which runs through all these judgments like a scarlet thread is the vital social need of protecting human life and well-being.

               

11. We have surveyed the English and American case law on the problem before us and seen the basic differences in their moral approach. The question is which path should Israeli judges pursue: are we to follow English case law which in its rigidity holds that the contract must prevail or are we to adopt - at least as regards injury to a person's life or health - the more liberal rule of American case law?

 

                It seems to me that we must take up the American rule because in doing so we are not choosing an alien creature but drawing legal conclusions from fundamentals very deeply rooted in Jewish consciousness.

               

                Should we then be asked how we can legitimize forming our own outlook on a rule which has its source in Turkish legislation, the answer is that whilst the rule that a contract can be set aside for being contrary to public policy is derived from section 64(1) of the Ottoman Civil Procedure Law, what that public policy is must be gathered from our own ethical and cultural conceptions since no other source exists for that.

               

12. Judaism has always extolled and glorified the high value of human life. The Jewish religion is not a philosophical system of opinions and beliefs but a way of life and a way for living "which if a man do, he shall live by them" (Len. 18:5), "live by them and not die by them" (Yoma 85b). The verses are innumerable which stress the causal nexus between the Torah and life: "keep my commandments and live" (Prov. 4:4): "he is just, he shall surely live" (Ezek. 18:9): "who is the man that desireth life..." (Ps. 34:13) and so on.

 

                Clearly Judaism has not regarded life as the supreme value. There are ends which go beyond it and ideals which exceed it, for the sake of which we should - indeed are commanded - to sacrifice life. Myriads of Jews have given their lives in sanctification of the Holy Name in all places and at all times. But in the ordered framework of social life, according to the priorities of the Jewish religion, life is the most sanctified of possessions ousting any other sacred value, including without a doubt the sanctity of contracts. "There is nothing that comes before the saving of life except only idolatry, incest and bloodshed" (Ketubot 19a); "For (the Sabbath) is holy unto you - it is committed into your hands, not you into its hands" (Yoma 85b).

 

                There is nothing in Jewish ethics which is more abominated than the taking of life. King David was punished for that reason: "But God said unto me, 'Thou shalt not build a house for My name, because thou art a man of war and hast shed blood' " (1 Chron. 28:3). "A Sanhedrin that effects an execution once in seven years is branded a destructive tribunal" (Makot 7a). And also in the prophetic visions of Isaiah and Micah of eternal and universal peace, "nation shall not lift up sword against nation, neither shall they learn war any more" (Isa. 2:4: Micah 4:3) are filled with deep revulsion and aversion to the shedding of blood.

               

                It is not easy to mint from these lofty concepts the coinage of actual law but when the decisive question in arriving at some legal conclusion is a question of philosophical outlook - what is "good" and what is "bad", what promotes the public weal and what impairs it - we may and indeed must draw precisely upon our ancient sources for these alone truly reflect the basic outlook of the entire Jewish people.

               

                The voice that calls from the depths of these sources tells us not to commerce in human life, not to act lightly in safeguarding it, for life is of the highest value, not ours to play with. The sanctity of contracts, or the sanctity of the principle of freedom of contract, has its proper place in the order of things but of far greater sanctity is that of life. No weapon that is formed against it shall prosper, and every tongue that shall arise against it in judgment you shall condemn, to paraphrase Isaiah 54:17.

               

13. The conclusion to be drawn from all the foregoing with regard to the case before us is that an exemption clause in the ticket which the respondent bought from the appellant company is null and void, as being contrary to public policy in the sense of section 64(1) of the Ottoman Civil Procedure Law. It is superfluous to emphasise that injury to life and injury to health are the same within the contemplation of the concepts that have their part in this context.

 

                I have not overlooked that rule in Jewish law, "if one said, 'put out my eye, cut off my arm, break my leg' ... on the understanding that the other would be exempt, the latter is nevertheless liable" (Baba Kama 92a], but I have not applied it in this judgment because having regard to the reason assigned to it by Maimonides (Hilkhot Hovel uMazik, V, 11) and the Shulhan Arukh Hoshen Mishpat (421:12) I have grave doubts whether it reflects the idea of prejudice to public policy within the meaning of section 64(1) as above.

               

14. There remains the second and last question of whether the appellants were guilty of negligence in the injury sustained by the respondent. My answer is that they were. The respondent embarked on the "Theodor Herzl" for the journey from France to Israel in good health. The following day after eating the food served to her, she felt unwell, began to vomit and to have diarrhoea. Upon arriving in this country she went down with a stomach infection that lasted some three months. Such physical hurt was caused apparently by the tainted food she had received on board, and the learned judge rightly applied the rule of res ipsa loquitur. Hence, since the appellants did not succeed to rebut the presumption, the company is vicariously liable and the ship's chef (the second appellant) directly liable. The negligence of these two appellants lies in serving tainted food which the respondent ate whilst on board the ship.

 

                In my opinion therefore the appeal should be dismissed.

               

LANDAU J. I agree.

 

                In Fox v. Ilan & Etzioni (1), dealing with restraint of trade, I drew attention to section 64(1) of the Ottoman Civil Procedure Law and mentioned article 6 of the French Civil Code, from which the provision prohibiting contracts that are contrary to public order and morality is drawn. This statutory provision of ours, as well as article 46 of the Palestine Order in Council, 1922, relieves us from the necessity of turning to English case law regarding public policy. When I went on there to express the opinion that it might be more correct to interpret section 64(1) in accordance with French jurisprudence, I did not mean to say that we should adopt the substance of French law in the matter but that we should define the general boundaries of the concept of public order and fill it with content of our own.

 

                French legal scholars construe the term "public order" in article 6 of the Civil Code in broad general terms, in the spirit of the basic concepts on which the entire legal system is based. This approach is fundamentally different from the conservative approach which treats the categories of public policy as being closed, so that creative power has been taken from the courts and there is nothing to add to what earlier courts up to a century ago laid down in the matter. According to the broad French approach, the source of these concepts lies not only in the realm of positive law but also in basic ideas of justice and morality and in the ever-varying needs of the social and economic system: see D. Lloyd, Public Policy, pp. 117 ff. That does not mean that the courts may intervene as they please in contractual relations according to the private view of the judge of what is good and useful in contemplation of these principles but must faithfully interpret them in the light of the opinion common to the enlightened public of which he is a part.

               

                My honourable friend, Silberg J., uncovered the deep roots of the Jewish view about the sanctity of life and all that stems from that. Such a view is not exclusively ours but is common to all other civilized peoples. This is what Josserand, Cour de Droit Civil Positif Francais (1930) vol. I, para. 475, has to say about contractual conditions which exempt from liability for injury caused by negligence:

               

"In my opinion the test must be sought in the nature of the injury; a distinction must be made between injury to persons and injury to property.

 

For injury to persons, it is essential to repair the wrong: physical personality is above private contracts, just as are a person's good name and repute. We cannot confer on another the right to kill us, to injure us or to defame us without punishment."

 

So also Ripert, Droit Maritime (4th ed.) vol. 2, para. 2004, p. 891, cited by the learned judge:

 

"It is in fact possible to lay down that public order prohibits also involuntary injury to a person's physical well-being. What is involved is no longer a matter of financial relations between two people. Monetary compensation is but the lesser of two evils and cannot make up for the damage sustained. Hence the prohibition of the cause of such damage needs to be absolute, not to be evaded by any voluntary act."

 

For the relevant French literature and case law. see also the interesting note by I. Englard in (1961) HaPraklit 219.

 

                I see no need to decide whether moral repugnance to endangering life and health is sufficient to invalidate any condition which a person may voluntarily take upon himself that offends against these values. When, however, a condition of this kind appears in a standard contract, as in the present case, where in fact the passenger has no choice, it must be set aside for being contrary to public order. The reasons for that are convincingly explained by the American judges cited by Silberg J. There is no occasion, in my view, for distinguishing in this matter between serious and minor injury to physical well-being, since every attempt to do so will involve prescribing finely drawn tests, the bounds of which do not lend themselves to clear definition. Nor do I see sufficient reason to distinguish between ordinary and gross negligence, as suggested in the alternative by appellants' counsel.

               

                Nothing in section 55(c)(1) of the Civil Wrongs Ordinance, 1944, is inconsistent with what I have said. That section, which deals with contributory negligence, was taken from section 1(1) of the English Act of 1945 but only preserves the general rule regarding conditions which negative liability in torts; it is not, however, intended to deny the possibility of negating such liability always and in all circumstances by contractual condition.

               

                The conclusion we have reached sits well with the decision of this Court in Shoham v. Feiner (2) which concerned a condition similar to the present one in a claim for repair to damage to property.

               

                Appellants' counsel submitted that to impose liability in tort upon the first appellant as a ship company would lay too heavy a burden upon it since it is not covered against such risks by its general insurance policies. But that is insufficient to justify exempting the appellant from all liability for physical damage caused by it or its employees' negligence. It would be better for the appellant to cover itself against risks such as these and to add the cost of the insurance to the price of the ticket, than to place upon the passenger the concern to insure himself, or leave him without compensation for any physical damage he may sustain.

 

                After writing these lines I read the instructive judgment of my honourable friend, Witkon J., and I wish to express my agreement with his balanced analysis of the various factors affecting the problem before us.

 

WITKON J. It is with much hesitation that I have also come to the conclusion that no validity attaches to the condition exempting the appellant from all liability for the physical injury which its employees have wrongly occasioned the respondent.

 

                I have no intention of placing in doubt our powers to set such a condition aside. I find strong foundation both in section 64(1) of the Ottoman Civil Procedure Law and in article 46 of the Palestine Order in Council, 1922, for the rule that an Israeli court may certainly invalidate a contractual term which in its opinion conflicts with the public good. Even without such statutory provisions I would not contend that the court must give effect and recognition to every harmful and unfair term to which the parties have agreed. For instance, a condition which exempts from liability for killing or wilful wounding, it is unnecessary to say, no court will recognize. And it is also clear beyond all doubt that in adopting this principle - whether from England or from France or as axiomatic of our very judicial functions - we are not dependent upon English or French scholars in deciding what in our contemplation is valid and what invalid from the viewpoint of the public welfare. A condition which is valid in England - will not for that reason alone presumptively be valid with us. As my honourable friend, Landau J., said, we must give our own content to the framework of public order.

               

                When, however, we come to weigh the considerations for or against invalidating any given condition, we immediately become aware that we are faced with a problem that is a cause of concern the world over. The American courts - so my honourable friend, Silberg J., demonstrated in his comprehensive survey - have annulled such a condition and we learn from Landau J. that French legal scholars have trod the same path. In  England as well people are in fact unhappy about conditions in standard contracts which exempt a carrier in a monopoly position from all liability for the physical injuries of his passengers. The sharp complaints voiced by Lord Denning in Adler v. Dickson (8) bear witness to that, and this case is also the source of the rule that the condition will not hold in the event of a breach going to the foundations of a contract. Thus we see that this flinching revulsion is universal, as are also the considerations which demand invalidation of the condition. The starting point of those who would set it aside is undoubtedly their concern for the security of the person who is in need of a public service, that neither his life nor his health should be at the whim of the carrier. Further, such a person also merits protection of the law against exploitation of his weakness, since the two parties are not in the same bargaining position.

 

                The first of these considerations - the sanctity of life - is not disputed and I would say that it is so well-known that it does not call for evidence. Everywhere, irrespective of religion or nationality, human life is regarded as a treasured possession to be guarded at all costs. It is a universal heritage, certainly among the Jewish people, as was shown by Silberg J. in his judgment. The trouble is, however, that this supreme consideration is not the only one which we must bear in mind. Were it possible to be guided solely by the concept which was so warmly expressed by Silberg J., we would arrive at some far-reaching conclusions which he himself does not support. We would have to annul every condition which limits a person's liability to compensate another for negligent physical injury irrespective of the circumstances in which the condition was stipulated, of the party making it and the mutual relationship of the parties concerned. The private carrier - as distinct from the public carrier - indeed everyone who agrees to render a service during which he may err and cause bodily harm to the other, would be prevented from agreeing with the latter to limit his liability. Such a result would certainly not meet with approval. Hence to arrive at a balanced outcome we must weigh all the considerations that pertain to the matter. As in most problems of law and of life in general, it is not the choice between the good and the bad which makes decision difficult. The difficulty lies in the choice between different considerations all of which are good and worthy of attention but inconsistent among themselves and in respect of which we must determine an order of priority. In the present case I have not found the task a simple one.

               

                Doubts over whether it is indeed desirable to annul the given condition stem in the first place from the leading rule that a person has full contractual freedom to ensure rights for himself and to waive rights, all as he pleases. In our own times, this rule may have lost some of its pre¬eminence but in my opinion, subject to certain limitations, this freedom is still a treasured possession and a necessary institution in the life of society. Moreover, if interference with freedom of contract is effected not by way of legislation but judicially, confidence in the law will be shaken. For the rule is that stipulation is permitted in civil law and denial thereof is adverse to the sanctity of contracts.

               

                For that reason, even if we were to say that every exemption clause of the kind in question is likely to render life and health a matter of free-for-all - and I do not join in this extreme view - there is in my opinion still no room to annul, because only of "the sanctity of life", every such condition contractually agreed upon by two individuals in the same position and of the same mind. To annul it, another factor is required, and indeed we are told that a contract between equal parties is unlike one between a powerful public or quasi-public body and a private person - "the small man" - who is in need of some essential commodity or service and is compelled to yield. Here occurs the well-known problem of standard contracts which will in the future occupy the attention also of our legislature. But here also I have reservations and I would not hasten to condemn all standard contracts. They appear to me called for by the realities of life, the outcome of the trend to standardisation that prevails in all areas of the economy. At all events, the courts do not generally incline to assume power to set aside such contracts when it is proved to their satisfaction that the conditions and fiats were brought to the notice of the customer. If need exists to control these contracts, the view is that it is a matter for the legislature (see per Cohn J. in Shoham v. Feiner (2) at p. 1454). Only thus can a supplier submit the reasonableness of his conditions to review, before contracting with his customers; and the proposer of the bill now before the Knesset in the matter has done well to choose this course. Here I wish to sum up by saying that if it is possible at all to regard the case before us as one in which the court may annul a condition agreed upon by the parties, that can only be because of the conjunction of two factors: firstly the contents of the condition are undersirable ethically and socially, and secondly it was stipulated in a contract in which the party at the disadvantage was not free to contest it. In this manner we have restricted the conclusion we have reached in the present case to standard contracts.

 

                Even the combination of these considerations still does not meet all my doubts. We must ask ourselves what is the reason for, what is the significance of, setting aside the exemption clause. Do we thus in truth enhance the degree of care taken by the appellant and all its employees and agents? I am not at all sure of that. The presumption is that a person will not treat another's life lightly. I would think that a person is careful or careless with another (and even with himself) according to his nature, his temperament and his ethical and intellectual standards, but the knowledge that he has to pay - or not to pay - damages for his negligent acts (in contrast to anticipating criminal conviction) has almost no effect in reinforcing - or weakening - his standard of care. If that is so in the case of the direct liability of a person, it is all the more so in the case of his servants and agents. It is common today to treat with doubt every principle of fault as a basis of liability in damages for injury arising out of the use of automobiles. Better, it is said, to proceed on the principle of absolute liability and the reason is that it is not to be presumed that the tortfeasor or victim will be less careful if he knows that in any case the victim will receive compensation, whether the injury was caused by the negligence of the one or of the other or without the negligence of either of them. Just as the expectation of having to pay damages even without fault by the tortfeasor does not render him more indifferent to another's life and health, it may also be assumed that the expectation of being exempted in the event of negligence will not increase his indifference. It is not therefore to be said that annulling the exemption will self-evidently encourage carefulness where before there was scorn, but the result - here as where absolute liability is imposed on car owners

- will be to spread the risk over the whole population by way of insurance.

 

                That in effect is the problem before us. What is displeasing in a case such as the present is that a person injured through negligence is without financial remedy, for remedy is denied him in consequence of the contractual condition which he accepted without having any choice in the matter. If we say that we cannot tolerate such a situation and that the exemption is not to be given effect, it is as if we said that the carrier must insure himself against this risk, and doubtlessly he will effect such insurance at the expense of the passenger by increasing the cost of the service. Theoretically, such compulsory insurance could also be imposed directly on the passenger, but clearly compulsory insurance effected by the carrier is more practical and reasonable. Nevertheless, is it in fact desirable and just to spread the risk of the individual among all passengers? That also will increase prices of commodities and services. One or other passenger may say to us, perhaps justly, that he wants no favours and is prepared to take the risk without paying any supplement to his fare. I can imagine many services, both in the transport area and in other areas, where it would be justified for the supplier to exempt himself from liability for negligent injury to customers and reasonable on the part of the customer to exempt him from this liability and take the risk without any insurance cover. Perhaps our case is such a case.

 

                My learned friends think that in point of public policy it would be better to compel the carrier to bear liability and ensure that the injured passenger receives her compensation. I am ready to join in this conclusion - even if not without hesitation - out of the consideration that what is involved is an essential mass service generally carried out without mishap. The straits of the injured individual, left without remedy, may be hard and in the result offend against the feeling of justice. On the other hand to spread the risk among all passengers cannot involve very large expenditure and the price for the service need not go up appreciably. If the "decree" we issue against carriers and passengers generally is that they shall not abandon the injured individual to his plight, they can bear up under it. Accordingly on balance of the considerations it seems to me also that the law should incline in favour of the respondent. In the result I also agree to dismiss the appeal.

               

Appeal dismissed

Judgment given on June 26, 1963.

 

LCA 6902/06

Menashe Dror Tzadik

v

1.    Haaretz Newspaper Publishing Ltd. et al

             

The Supreme Court sitting as the Court of Civil Appeals

[26 December 2007]

Before Vice-President E. Rivlin and Justices J. Elon, A Grunis

Application for leave to appeal the judgment of the Tel Aviv-Jaffa District Court dated June 29, 2006, of CA 1974/04 by Judges I. Shilo, U. Fogelman and R. Ronen

Legislation cited:

Protection of Privacy Law, 5714-1981

Defamation Law, 5725-1965

 

Israeli Supreme Court cases cited:

[1]          CA 439/88 Database Registry v. Ventura [1994] IsrSC 48(3) 808.

               

For the applicant –          S. Peled, D. Shuv

For the respondents – T. Leiblich, T. Neumann

 

JUDGMENT

Vice-President E. Rivlin

Before us is an application to appeal the judgment of the Tel Aviv-Jaffa District Court (Judges U. Fogelman, R. Ronen and I. S. Shilo), which granted the respondents' appeal of the judgment of the Tel-Aviv Jaffa Magistrates Court (Judge Y. Shevah). It also determined that the respondents are not required to compensate the applicant.

The facts

1. The applicant is a member of the ultra-Orthodox community. One day in January 2002, the applicant set up a stall to distribute religious books near Dizengoff Center in Tel Aviv. It turned out that the stall was situated next to a store in which hung an advertisement that was described by the Magistrates Court as -

… A giant poster, of large proportions, hanging in the window of the shop in front of which the claimant set up his stall, featuring a woman wearing tight little shorts, standing with her legs wide open, with the figure of a man between them, looking at her.

At some point, the applicant noticed that respondent 4, a professional press photographer, was trying to photograph him. In response to the applicant’s strong objections to being photographed, respondent 4 assured him that the pictures were being taken for his personal use only. This promise turned out to be short-lived and unfounded, for the picture was published on February 2, 2002 in respondent 4’s regular column in Haaretz newspaper, published by respondent 1. The applicant filed suit against Haaretz Newspaper Publishing Ltd. (respondent 1), against its editors (respondents 2 and 3) and against the photographer (respondent 4) claiming that the publication of the photograph violated his privacy and constitutes a defamatory publication against him.

The previous proceedings

2. The Magistrates Court ruled that publication of the photograph constituted a violation of privacy under s. 2(4) of the Protection of Privacy Law, 5741-1981 (hereinafter: "Protection of Privacy Law"), because its publication could humiliate the applicant and cause him embarrassment within the ultra-Orthodox community in which he lives. The Court ruled that in this case, none of the defences in the Protection of Privacy Law were applicable. According to the Magistrates Court, the defence provided in s. 18(3) of the Law does not apply to our case because there is no public interest that justifies the violation of privacy. The Magistrates Court also found that contributory fault can be attributed to the applicant in that he “chose” to situate his stall next to the “provocative poster.” The compensation determined by the Magistrates Court, after a reduction of NIS 10,000 for the contributory fault, was set at NIS 20,000. The Magistrates Court rejected the applicant’s claim that publication of the photograph was defamatory, based on the defence prescribed in s. 14 of the Defamation Law, 5725-1965 (hereinafter: "Defamation Law") regarding a true publication that is of public interest.

3. The District Court granted the respondents’ appeal of the Magistrates Court’s judgment. The District Court ruled that even assuming that the publication involved a violation of privacy, the respondents could invoke the defence specified in s. 18(3) of the Protection of Privacy Law. According to the District Court, the applicant “is the one who chose the location of his stall to distribute religious books to the non-religious public, out of free choice and even though he was aware of his surroundings. He saw fit to position himself next to the shop window containing the poster that sparked his wrath.” Therefore, the District Court stated that “this is not a case of protecting someone who wished to be left alone, and the violation of privacy is limited in extent.” Under these circumstances – so it determined – considerations of freedom of expression and the public interest in the publication outweigh the violation of privacy (assuming such a violation does indeed exist). The District Court concurred with the Magistrates Court’s reasons for rejecting the applicant’s suit based on the Defamation Law.

  The applicant filed an application for leave to appeal the judgment of the District Court. Following the hearing held before us, the parties submitted supplementary summations on the question of whether in this case there was a violation of privacy, within the meaning of the provisions of s. 2(8) of the Protection of Privacy Law.

 The Parties’ Claims

 4. The applicant reiterates his arguments that the publication constitutes a violation of privacy and defamation. He especially emphasizes the fact that he “resolutely announced his refusal to have his picture published and he received explicit assurance of such from respondent 4” [emphasis in original - E. R.]. The applicant argues, inter alia, that there is no public interest in the publication of the photograph which would justify the violation of privacy, since he is a private individual and he was not photographed in the context of any public event. He maintains that there is no justification for giving priority to freedom of expression in this case, and that the District Court did not achieve a correct balance between the violation and the public interest.

5. The respondents maintain that leave to appeal should not be granted because the conditions for holding a “third round” of hearings on this matter have not been fulfilled. Essentially, the respondents believe that there has been no violation of privacy within the meaning of the Protection of Privacy Law. In their opinion, publication of the photograph does not “debase” or “humiliate,” and therefore it does not fall within the bounds of the provisions of s. 2(4) of the Law. Similarly, the respondents argue that there has been no violation of privacy in the sense of a “breach of duty of confidentiality regarding a person’s private affairs, by virtue of an explicit or implicit agreement” – in accordance with s. 2(8) of the Law. This is because the published photo is unrelated to the “private affairs” of the applicant, who elected to distribute religious books in the public domain. They further argue that no agreement was made between the parties. The respondents believe that even if the applicant’s privacy was violated, the defence prescribed in s. 18(3) of the Law applies in this case, since the published photo was true and of public interest. The respondents point out in their supplementary summation: “Indeed, respondent 4 may have erred when he told the applicant, out of distress and fear, that the images would be for his personal use only. Perhaps this was wrong. However, this error in no way adds to or detracts from the applicant’s claims.”

We have decided to grant leave to appeal and to treat the application as if an appeal had been filed based on the leave granted. The appeal should be granted.

Breach of a Confidentiality Agreement Regarding a Person’s Private Affairs

6. As we will explain imminently, what makes the circumstances of this case unique is the promise given by respondent 4 to the applicant. S. 2 of the Protection of Privacy Law, which defines “what is a violation of privacy,” includes various situations that constitute a violation of privacy, including the following situation (subsection 2(8)):

'A breach of a duty of confidentiality regarding a person’s private affairs, as determined in an explicit or implicit agreement.'

This subsection lists three elements: an explicit or implicit agreement; the agreement creates a duty of confidentiality regarding the person’s private affairs; a breach of that duty. The element of "agreement" is present in our case. Respondent 4 assured the applicant that the photographs were intended for his personal use only. He admits this, and even says that he “may have erred” in doing so. This is an agreement whereby respondent 4 undertook not to publish his photographs of the applicant against the background of the said poster on the wall. This is a “duty of confidentiality” – as specified by the Law. The fact that the agreement was given verbally, in the street, does not detract from its validity – this is a street agreement, contracted in real time when street photos were being taken. Furthermore, according to the wording of the Law, the existence of an implied agreement is sufficient to fulfill the conditions of the section. It was respondent 4 who chose to promise what he promised. He took the commitment upon himself. No circumstances that void his commitment have been proven to exist in our case. The element of a “breach of a duty of confidentiality” also exists in our case – it was breached when the photograph of the applicant was published in the newspaper.

7.  Does the duty of confidentiality in the agreement relate to the applicant’s “private affairs”? This question must be answered in the affirmative. The Protection of Privacy Law does not define the term “private affairs.” The interpretation of the term was discussed in CA 439/88 Registrar of Databases v. Ventura [1], at p. 808: the question there related to whether the creation of a database of people and corporations who had provided checks without coverage constituted a violation of privacy under s. 2(9), which deals with the situation in which use has been made of information relating to a person's "private affairs" for a purpose other than the purpose for which it was divulged. In that case Justice Bach adopted a broad interpretation of the term “private affairs” and determined that –

 '[t]he natural and normal meaning of the words a person’s ‘private affairs’ is any information related to that person’s private life, including his name, address, phone number, workplace, his friends, his relationship with this wife and other family members, etc.'

Justice Strasberg-Cohen interpreted the term more narrowly and opined that its interpretation should be dependant on the particular context and circumstances of the case:

'The answer to the question of what are a person’s private affairs is not unequivocal, and as with many other expressions that we encounter in law books and in every day life, their interpretation depends on their context and the purpose that this interpretation must serve.'

 According to Justice Strasberg-Cohen, “it may be that each separate detail does not constitute a person’s ‘private affairs’, whereas the combination of several details and the information derived from them might constitute such affairs.”

8.            The scholar Eli Halm, in his book Privacy Law (2003)121-126, provides support for ascribing a broad interpretation to the term “private affairs.” In his opinion, we must distinguish between information relating to a person's "intimacy" and a broader framework of information that falls into the category of a “person’s private affairs.” This distinction is based on the fact that the Protection of Privacy Law does not prohibit everyone from publishing information related to a person’s “private affairs,” but rather,  it imposes this prohibition on a particular, defined group of people who have a “special relationship” with the informants: one who by virtue of the law is obligated to refrain from publicizing (s. 2(7)); one who by virtue of an agreement is obligated to refrain from publicizing (s. 2(8)); one who makes use of information for a purpose other than the purpose for which the information was divulged to them (s. 2(9)). These special relationships – according to Halm – impose a greater duty on the person receiving information not to expose details related to the privacy of the informant. Therefore, information belonging to the “outer circle” of a person’s privacy – such as identifying details and contact information, as well as personal and particular details – should be included under the heading of “a person’s private affairs.”   

9. The conclusion that the applicant’s photograph constitutes a part of his “private affairs” is derived from the application of each of these approaches described above. According to the broad interpretation that Justice Bach assigned to the term, a photograph exposing the identity of the applicant and, in our case, his occupation at that time, certainly involves the applicant’s “private affairs.” According to Halm’s approach, it would appear that a person’s photograph is included in the applicant’s “private affairs,” since it includes identifying details and details particular to him, and the prohibition on their publication is justified in light of the “special relationship” that exists in our case, i.e. the photographer’s promise not to publish the photograph. Even the application of the more limited approach, that is conditioned by the actual context and circumstances, will not yield a different outcome. According to this approach, assuming that a person’s photograph does not necessarily constitute a part of his “private affairs” in every case, the photograph in the case before us – by means of which it is possible to identify the applicant, his communal affiliation, his location and his activities at that time – constitutes a combination of details that constitute a “private affair” in this specific context.

In our case, therefore, the elements listed in s. 2(8) of the Protection of Privacy Law are all present. Having reached the conclusion that the applicant’s privacy was violated, we must now examine whether the defence claimed by the respondents – which appears in s. 18(3) of the Law – applies in this case.

The defence in s.18(3) of the Protection of Privacy Law

10.          Under s. 18(3) of the Protection of Privacy Law, a valid defence requires that -

'There was a public interest that justified the violation in the circumstances of the case, provided that if the violation was by publication –the publication was not false.'

The parties disagree on the question of whether there was “a public interest that justified the violation in the circumstances of the case.” The District Court answered this question in the affirmative, after considering the balance between freedom of expression coupled with the public’s interest in the publication, and the right to privacy. The problem with this mode of analysis lies in the fact that it does not attribute sufficient weight to the central issue that makes the case before us distinct – the existence of a promise on the part of respondent 4 that he would not publish the photograph. Even though this promise does not automatically negate the applicability of the defence, it certainly has implications for the nature of the public interests involved and for the appropriate balancing point. First, the public's interest in upholding the principle that “a promise must be kept” does exist. Secondly, there is a public interest in the maintenance of journalistic integrity. This second interest is also, and especially, in the interest of newspapers wishing to maintain fruitful reciprocal relations with their sources.  The need to protect all these interests certainly dims the “public interest” in the publication of the photo. We have not been convinced that in this particular case, a “public interest” exists that would justify the violation of a promise given to the applicant and the violation of his privacy. The more that this protection is extended to situations such as the one before us, the more s. 2(8) of the Law will lose its meaning. This was not the legislature’s intention in prescribing the defence in s. 18(3). This was not the purpose of the Law (regarding this defence, see also: Halm, ibid., pp. 213-236; Database Registry v. Ventura [1], at pp. 825-827).

As an aside we will mention that the question of whether there was deception in the published photo in this case is not a simple one. The “displacement” of the applicant, who belongs to the ultra-Orthodox world, from his usual surroundings and the capturing of his figure, identifiable by clothes distinctive to his community, against the background of a revealing picture of a young woman, draws a prejudicial connection between him and a world that he and the members of his community view as illicit. The question raised here is whether the photograph reflects the truth or a distortion of reality created by a coincidence. This question could arise in another similar, if not identical situation, for example where a camera captures a politician just as a huge advertisement for the opposing party pasted to the side of a bus passes by. This question was not discussed in the lower court, nor will we address it now.

11.          Having arrived at this conclusion, we have not found it necessary to decide on the applicant’s claim that his privacy was also violated under s. 2(4). Regarding the claims related to the Defamation Law, we have not found any reason to interfere with the conclusion reached by the earlier courts. This is because we have not been convinced that the publication of the photograph harms the applicant to a degree that constitutes grounds for a suit under the Defamation Law. Needless to say, in such matters each case must be examined based on the particular circumstances.  It must be said that if not for the violation of the promise to the applicant, in my view the applicant would not have had a case. Were it not for that promise, I think that freedom of expression would prevail over violation of privacy, as well as any damage to the applicant’s good name.

The remedy

12.          The Magistrates Court set the amount of compensation payable to the applicant at NIS 30,000. The Magistrates Court deducted NIS 10,000 from this amount due to the “contributory fault” that it assigned to the applicant, since he had chosen to situate his stall near the “provocative poster.” Indeed, the stall was situated near the shop where the advertisement hung inside; however, this “contributory fault” is irrelevant to the issue of the agreement made between the applicant and respondent 4. Therefore, in light of the reasoning at the basis of our ruling today, there is no reason to reduce the compensation and it should be set at NIS 30,000.

The appeal is granted as stated. The District Court’s judgment is voided. The judgment of the Magistrates Court, with the aforesaid amendment, is reinstated. The respondents will bear the applicant’s court costs and lawyers’ fees in the amount of NIS 10,000.

Justice J. Elon

I agree.

Justice A. Grunis:

I agree with my colleague, Vice-President Eliyahu Rivlin, that in this case, the applicant’s privacy was violated, as stated in s. 2(8) of the Protection of Privacy Law, 5741-1981. I also agree that in light of the promise made by respondent 4 to the applicant and following its violation, the defence prescribed in s. 18(3) of the Law does not apply to our case.

   Therefore, I see no need to express an opinion about what conclusion would have been drawn were it not for the violation of the promise made to the applicant.

 

Decided as per the judgment of Vice-President E. Rivlin

12 Av 5768

13August 2008

 

 

Crim.A. 70/64

 

           

ARMAND STROUL

v.

ATTORNEY-GENERAL

 

 

In the Supreme Court sitting as a Court of Criminal Appeal.

[June 22, 1964]

Before Olshan P., Landau J. and Cohn J.

 

 

Criminal law - administration of wrong blood type - causing death by negligence - causal connection - duty of care - Criminal Code Ordinance, 1936, secs. 218, 219(e) and 231.

 

 

The appellant, a qualified hospital laboratory technician, supplied blood for transfusion to a patient without making sure - by inspection of the label on the bottle containing the blood and carrying out certain prescribed tests - that the blood was compatible with that of the patient. The two were in fact not compatible and after being transfused with blood supplied the patient died. The appellant was convicted and sentenced in the Magistrate's Court and his appeal to the District Court failed. On appeal to the Supreme Court, two submissions in law were made: that the acts or omissions of the appellant were only of the nature of "acts of preparation" and the effective cause of the death were the acts and omissions of the hospital staff to whom the appellant had delivered the blood; that the appellant owed no duty of care to the patient since in the circumstances it was not to be assumed that the blood would be administered without examination by others of the hospital staff.

 

Held                       (1) The mere fact that others are negligent in carrying our their duties does not break the causal connection between a person's initial negligence and the ultimate result.

(2) Every person owes a duty of care to the eventual victim when he does an act which may endanger the life or health of another and he cannot plead in defence that he relied on the fact that others might or should later take steps to avoid the danger,

 

Israel cases referred to:

 

(1)        Cr.A. 180/61 - Baruch Alpert v. Attorney-General (1962) 16 P.D.1416.

(2)   Cr.A. 11/52 - Joseph Menkes and Others v. Attorney-General and Counter-appeal (1958) 12 P.D. 1905.

 

 English cases referred to:

 

(3)        M'Alister (or Donoghue) v. Stevenson & Others (1932) A.C. 562.

 

S. Toussia-Cohen for the appellant.

G. Bach. Deputy State Attorney. for the respondent.

 

COHN J.                     The appellant was convicted in the Rehovot Magistrate's Court of a crime under section 218 of the Criminal Code Ordinance, 1936  (hereinafter called "the Ordinance") in that he caused, by want of precaution not amounting to culpable negligence, the death of Dr. Bela Granadi. The Tel Aviv-Jaffa District Court, sitting on appeal, confirmed the conviction, but gave the appellant leave to appeal again to this Court.

 

            The relevant facts, no longer in dispute, are as follows:

           

(a) The appellant worked as a "qualified laboratory worker" in the blood bank in the "Assaf Harofeh" hospital in Tzrifin. His task was inter alia to supply the operating theater of the hospital, from the stock in the blood bank, the blood required for transfusion of patients. For this purpose a sample of the blood of a patient is given to him; and it is well known, and the appellant knew, that not all types of blood intermingle and that the danger of immediate death exists if a person with one type of blood is infused with one of the other types which do not mix with his blood. The appellant's duty as, therefore, to inspect first the patient's type of blood and mark it with red pencil on the order form sent to him; to take from the refrigerator bottles of blood of the type which suit the patient's blood type and afterwards to do three "cross-breeding" tests, each according to a different method - that is to say, cross-examination tests of blood mixture of the patient's blood with the blood taken from the refrigerator, so as to know and confirm that they really mix. When the time comes for the blood transfusion, the responsible nurse in the operating theater ends a messenger to the blood bank, who receives either from the appellant or another employee in the blood bank the bottles of blood intended for the patient concerned and which were put back, after all the said tests, into the refrigerator, marked with the patient's name and his blood type, and the order form attached to them.

 

(b) When on 19 December 1960 the appellant received a sample of the deceased's blood, he tested it and determined its type as required; afterwards he went to the refrigerator and took out bottles of blood from it, which stood in the place where, to the knowledge of the appellant, bottles of blood of the deceased's blood type stood. On these bottles the type of blood which they contain was marked. Had the appellant looked at them, he would have seen that the blood in one of the bottles was not of the deceased's blood type. The appellant relied, it seems, too much on the place where the bottles stood in the refrigerator, which was, as I have said, the place where the bottles of the suitable blood type stood, and he did not look at the labels of the bottles. Not only that, but he did not do the said "cross­breeding" test; he returned to the refrigerator the sample of the deceased's blood together with the bottles which he had taken from the refrigerator as aforesaid, marked as intended for the deceased, with the order form attached to them.

 

(c) On 20 December 1960, the day of the operation, a messenger from the operation theater came to the blood bank, and another employee in the blood bank went to the refrigerator, found the bottles for the deceased and handed them over to the messenger. Had she looked at the bottles, she would have discovered that the type of blood marked on one of them did not match the type of blood marked on the order form as the patient's blood type, but she also did not look.

 

(d) The messenger brought the bottles of blood to the operating theater, and when the person responsible in the theater at the time wanted to look at them and see if everything was as it should be, the doctor requested him to hand him the bottles of blood, and so he did; and the inspection was not done.

 

(e) The death of the deceased on the same day was caused by the transfusion of blood which was not of the type of the deceased's but of a different type which does not mix with it.

 

            Before us Mr. Shlomo Toussia-Cohen, counsel for the appellant, tried to argue that although the appellant did not do all the "cross-breeding" tests which it was his duty to do as aforesaid, then at least he did some of them - or if he did not carry them out in the way that it was his duty to do, then at least he carried them out in a different way. At this stage we will not entertain such factual arguments, and we do not dispute the finding of the learned judge in the Magistrate's Court that the appellant did not do "cross-breeding" tests, not all of them or part of them (paragraph 19 of the judgment); and we agree with the evaluation of the learned judge that the appellant thereby was in breach of "an elementary obligation" imposed upon him. And furthermore, by writing the word "compatible" on the order form next to the serial numbers of the bottles of blood which he had prepared for the deceased, he created the wrong impression that he had actually carried out the required tests and found that the types of blood were compatible with one another.

 

            Learned counsel for the defence raised two legal arguments: the first, that the acts or omissions of the appellant did not cause the death of the deceased, they were only within the "acts of preparation" of the acts or omissions of others who caused his death; and the second, that an offence of want of precaution is only committed when a duty of care is imposed on the accused in respect of the deceased, and here there was precisely no duty of care imposed on the appellant toward the deceased. I have not found any substance in these arguments.

           

            As to the causal connection between the appellant's acts or omissions and the death of the deceased, it is sufficient for the prosecution to rely on the provisions of section 219(e) of the Ordinance which provides as follows:

           

"A person is deemed to have caused the death of another person although his act or omission is not the immediate or not the sole cause of death -

...

(e) if the act or omission would not have caused death unless it had been accompanied by an act or omission of the person killed or other persons."

 

            Mr. Toussia-Cohen says what is involved are the acts or omissions of others which "accompanied" the appellant's acts or omissions - excluding acts or omissions of others which followed them. The word "accompanied", which the legislator used, indicates, according to this argument, the simultaneity in time of the said acts or omissions, as though they were all done or omitted simultaneously and not one after the other. Here, these were omissions by the rest of the hospital employees who were obliged, in his argument, to inspect whether the blood prepared by the appellant was really suitable for transfusion to the deceased, which occurred after the appellant's acts or omissions and not simultaneously with them; and therefore there is nothing in section 219(e) to constitute the appellant's act or omission as the cause of death by virtue of the law.

 

            There are several answers to this argument: first, the legislator did not in using the word "accompany" adopt technical language at all; his purpose was to assume the existence of different acts and omissions, except for the accused's act or omission, which possibly also caused the victim's death; and it is irrelevant whether they came simultaneously or earlier or later - provided that all of them might have contributed to the death. Secondly, the pleader reveals a misunderstanding of the English language, if he thinks that this word means just to accompany simultaneously; in every dictionary, other meanings will be found in addition to that meaning, such as to supplement, to complete, to coexist, to be added to and not only simultaneously. And thirdly, and this to me is the main point: if you indeed say that the acts or omissions of the rest of the hospital employees did not "accompany" the appellant's acts or omissions in the meaning of this word in section 219(e), the result is not that only because of this are they regarded as the cause of death and not the appellant's act or omission. But the opposite is the case; if there had not been acts or omissions of others which accompanied, in the full meaning of that word in section 219(e), the appellant's act or action, then the appellant's act and omission remained the sole and immediate reason for the death, as stated in the beginning of the section. The mere fact alone that they were "accompanied" by acts or omissions of others as possible causes of the death, creates the problem which section 219(e) is meant to settle.

           

            Accordingly the appellant's act or omission should be regarded as the cause of the death of the deceased, in spite of the possibilities (or even the certainty) that it was possible to avoid the disaster had the rest of the hospital employees subsequently examined the blood prepared by the appellant for that purpose and before the transfusion. Because the rest of the employees are not standing trial before us, I see no need to inquire whether any duty was imposed on them to carry out such additional tests; but as regards the second submission of law I will assume for the benefit of the appellant that he did in fact rely on additional tests being done as aforesaid.

           

            The submission, it will be recalled, is that no duty of care was imposed on the appellant in respect of the deceased and therefore his lack of care gives no cause for his being criminally charged. This argument rests on the rule handed down in the House of Lords in Donoghue v. Stevenson (3), that a person owes a duty of care towards all those to whom a dangerous thing of his manufacture might reach and in the circumstances one may suppose that the dangerous thing will reach that person without further examinations or changes. From the affirmative one arrives at the negative, that if in the circumstances it may be supposed that the dangerous thing will undergo further examinations before reaching that person, then the manufacturer does not owe that person a duty of care.

           

            With due respect to this rule, the cases are not identical. First, there a bottle of beer was involved, in which the remains of a snail which certainly would harm were found, whilst here a prophylactic was involved. Secondly, it was possible to discover the remains of the snail, whether in the bottle before it was emptied or in the glass into which the beer was poured; here the danger of the prophylactic was hidden and could only be discovered by laboratory tests. Thirdly, and this is the main point, there the beer was not prepared for some particular person, either the plaintiff in the case or a specific, known person; here the blood was prepared for the deceased only and had to be prepared according to his real needs. To whom, if not to the deceased, did the appellant owe the duty to prepare the blood with the required care?

           

            Rather, I agree with the submission of Mr. Bach, speaking for the Attorney-General, that the whole question, to whom the appellant owed a duty of care, does not arise at all in view of section 231 of the Ordinance, which imposes a duty on every person doing an act that might endanger the life or health of another to do it with reasonable care; and the section prescribes, at the end that a person who did an act as aforesaid in violation of this duty is regarded as having caused the consequences which result from this omission to the life or health of any person. The appellant well knew how great the danger was to the patient's life if he received a transfusion of blood which did not mix with his own. The duty imposed on him, under section 231 was to prepare with reasonable care the blood for transfusion, that is to say, by taking all the steps and carrying out as aforesaid all the required and fixed tests in the matter. He violated this duty in that he did not take the steps and did not carry out those tests. He is criminally responsible for the consequence of his omissions, the death of the deceased, and it is immaterial that he relied or could have relied on the fact that others would later do the tests.

 

            I am of the same opinion as the learned judges in the District Court, that as to the matter before us it is possible to draw an inference from the matter which was before this Court in Alpert (1). There, a doctor made a mistake in prescribing a medicine which, as prescribed, contained a quantity of poison sufficient to kill the patient. This prescription was directed to the chemist, and there was a clear duty on the chemist to check it and verify that the doctor really did not err in prescribing a quantity of poison which, also according to the knowledge of the chemist, could kill a person. Nonetheless, the doctor was found criminally responsible in that he was in breach of the duty of reasonable care placed on him. And if the doctor there was responsible, the appellant before us a fortiori, because there the act of preparing the medicine was the chemist's, whilst here the act of preparing the blood is the appellant's and precisely his task and responsibility.

           

            I would dismiss the appeal against conviction.

           

            The appellant also appealed against the severity of sentence. The District Court did not see fit to interfere with the sentence, and there is no need to say that it would not have given leave to appeal for a second time to this Court with regard to the penalty. The learned judge in the Magistrate's Court sentenced the appellant to one year's imprisonment, of that six months actual and six months on suspended sentence, and in addition to a fine of IL 1,000. In giving sentence the learned judge says:

           

"Unfortunately the present is not a case of a mere inadvertent mistake, but an act of negligence done intentionally out of disregard for the elementary duties imposed on the accused.... The accused was capable of estimating the extent of danger to a person's life to be expected from his act ... and he was obliged... to pay respect to the essentiality of those means of care which medical science has prescribed in order to prevent danger to a person's life... .

 

It is true that although the act was committed at the end of 1960, the prosecution for some reason found it necessary to lay an indictment only close to the end of 1962, and this delay was an injustice to the accused. But the seriousness of the accused's act is so great that one cannot attribute to this delay a decisive role in fixing the penalty. although I do not disregard it."

 

            The main argument of learned defense counsel before us was that since the accident three and a half years have elapsed, of which two passed waiting for trial and eighteen months during trial, and fear of the law hovered over the appellant for all this long period. This is a consideration which should properly be taken into account in mitigating the appellant's sentence; but since we are convinced that the learned judge also took this consideration into account in mitigating the appellant's sentence, that is no longer ground for our interference.

           

            The appellant was fortunate that he was charged with an offence under section 218 and not with a felony under section 212 of the Ordinance; and in view of the serious consequence of the appellant's act and omission, the punishment imposed on him seems to be too light.

           

            The appeal against sentence is also to be dismissed.

           

OLSHAN P.               I concur.

 

LANDAU J.               I concur.

 

            As to the interpretation of section 219(e), I expressed the opinion in Menkes v. Attorney-General (2) that this section, with its five sub­sections, does not exhaust all the cases in which a person will be regarded as causing the death of another under sections of the criminal law which prescribe the criminal offences of causing death, among which is section 218. Section 219 was drafted on the basis of precedents in English case law, and its source is in section 262 of Steven's Digest of Criminal Law, prepared on the basis of the English case law (see 8th ed., p. 215). I have studied the English judgments mentioned by Steven as authority for his section 262(e), from which our section 219(e) is copied, and I have found that in all of them the accused's act or omission was "accompanied" by the victim's or a third person's act or omission in the narrow sense of the term, that is, the effect of two factors simultaneously and not one following the other. It seems to me that also according to this narrow chronological test, the case before us comes within section 219(e), since the appellant's negligence, expressed mainly in the failure to carry out the required tests, whilst noting "compatible", which is intended to testify that the tests were carried out, continued to have its damaging effect also when each of the other people, who could have avoided the accident, was negligent in fulfilling his duty, till the final stage in which the lethal blood was actually to be used. (Cf. Alpert (1) at pp. 1420-1421.)

 

            Even if we use the flexible test outside section 219 which 1 suggested in Menkes (2): "if according to the facts the causal connection between the accused's act and the death is so strong that criminal responsibility for the death is to be imposed on the accused", there is no doubt that the requirements of this test were here fulfilled. Out of all the measures of care which should have been taken in order to prevent a disaster from transfusion of blood of an unsuitable type, the laboratory test which the appellant should have done was the basic and principal measure. Carrying out this test was entrusted to him and to him alone, in reliance on his special professional capability, and although others could have prevented the consequences of his gross negligence, none of them was obliged to do so by checking by some laboratory test, to do which was imposed on the appellant.

           

            Appeal dismissed

            Judgment given on June 22, 1964

C.A. 7/ 64

 

       

FRIEDA SHOR

v.

STATE OF ISRAEL AND ANOTHER

 

 

In the Supreme Court sitting as a Court of Civil Appeal

[June 21, 1964]

Before Silberg J., Witkon J. and Halevi J.

 

 

 

Torts - vicarious liability - res judicata.

 

 

                In April 1957, the appellant sued a police sergeant for damages for physical injuries he had caused her. That action was dismissed at first instance on the ground of lack of evidence, and the Court of Appeal refused to interfere with this decision. The appellant then began an action against the respondents as the employers of the sergeant, claiming vicarious liability, in respect of the same alleged injuries. An application by the respondents to dismiss the action in limine as res judicata was granted: hence this appeal.

               

Held. (1) The rule that a judgment as between A and B will not be res judicata as between A and C is subject to an exception that where B was an employee directly responsible for the tortious act and C was vicariously liable therefor.

 

(2) The fact that an employee is held liable in tort will not bar the employer from denying that liability, if the latter was not party to the first trial, whereas if the employee is found to be free of liability. that will enure to the benefit of the employer even if not a party. The reason is that the employee's direct liability is the basis for the derivative liability of the employer and not the reverse. Accordingly the two claims are identical although the parties differ. If there is no direct liability on the part of the employee, there can be no derivative (vicarious) liability on the part of the employer.

 

 

Israel cases referred to:

 

(1)        C.A. 126/51, Shlomo Felman v Yachieh Shahav (1952) 6 P.D. 313.

(2)   C.A. 143/51, 55/52, Mayor, Members of the Council and Residents of Ramat Gan and Others v Pardess Yanai Co. Pty. Ltd. (1956) 10 P.D. 1804.

3. C.A. 49/63, Abraham Zucker v Yeshayahu Leibovitz (1964) 18 P.D. (1) 337.          
4. C.A. 155/50, 159/50, David Rahamim Mizrahi v Yaacov Rahamim (1951) 5P.D. 540
5. C.A. 534/59, Escher Cohen v Naomi Cohen (1960) 14 P.D. 1415.

(6)   C.A. 395/60, Roma Amrani v Attorney-General and National Insurance Institution (1961) 15 P.D. 594.

(7)        C.A 286/62, Shlomo Ma'aravi v Shlomo and Regina Eltars (1963) 17 P.D. 1350.

 

American cases referred to:

 

(8)        Portland Gold Mining Co. v Stratton's Independence, 158 F. 63 (1907).

(9)   Albert S. Bigelow v Old Dominion Copper Mining & Smelting Co., 225 U.S. 111 (1912).

(10) Prichard v Nelson et al., 55 F. Sup. 506 (1942).

(11) King v Stuart Motor Co., 52 F. Sup. 727 (1943).

(12) Weekly v Pennsylvania Rly. Co., 104 F. Sup. 899 (1952).

 

The petitioner appeared in person.

 

Dr. M. Eltes, Deputy State Attorney and Mrs. P. Albeck, Principal Assistant to the State Attorney for the respondents.

 

SILBERG J.               The only question before us in this appeal is whether the judgment given by the Jerusalem District Court in C.C. 61/57 constitutes res juditaca regarding the action commenced by the present appellant in C.C. 211/63.

 

2. The few necessary material facts are:

 

(a) In April 1957 the plaintiff filed a claim against Mr. Shmuel Steinfeld, a police sergeant, for the sum of approximately IL 3,200 as tort damages for bodily injury.

 

(b) The District Court dismissed the claim, holding that the appellant had not proved her claim. The court said per Judge Gollan the following:

 

"The court which heard the plaintiff testify is not of the opinion that the plaintiff is a liar. A liar is a person who presents facts which do not exist in reality according to the best of his knowledge and who knowingly gives other details of the fact and intentionally changes it, in order to mislead the listener. The court is not of the opinion that the plaintiff belongs to that type of person. But, in the light of the evidence of Dr. Baumatz and Dr. Schlossberg, and of the plaintiff herself, on appearing in court both as plaintiff and as witness and her behaviour, the court is of the opinion that it would not be justifiable to rely on her testimony alone to find against the defendant in this case. Although the court received the impression that the defendant's denial that he touched the plaintiff in any way is exaggerated, we have insufficient proof in law of the fact that it was the defendant who caused the plaintiff to break her arm and of the damage which she claims from him."

 

(c) The appellant appealed against judgment to the Supreme Court in C.A. 35/58 (unpublished) and her appeal was dismissed. The Court said:

 

"We do not think that we can as appeal judges interfere with the learned judge's assessment of the appellant's testimony, based as it is, at least partially, on the impression that she made in the witness box. It follows that the principal proof falls away and therefore her claim has to fail, as the judge decided."

 

(d) Afterwards the appellant submitted a new claim in C.C. 211/63 in the Jerusalem District Court for the same injurious act, but this time the defendants were the State of Israel and the Inspector-General of Police, the cause of action was the vicarious liability of the employers of Sergeant Steinfeld, and the amount claimed was IL 30,000. The defendants applied by way of motion, asking for the claim to be struck out in limine under rule 21a of the Civil Procedure Rules, 1938, on the ground that the judgment mentioned in (a) above constitutes res judicata in respect of the second claim. The court accepted the argument and struck out the claim in limine, and against that the appellant now appeals.

 

3. The arguments of the appellant are principally two:

 

(a) The learned judge disregarded the rule decided in Felman v. Shahav (1), which she claims, is that any judgment which does not determine a positive finding, does not constitute res judicata in respect of a new claim. All which the court decided there in File 61/51 was that the appellant had not proved her claim, that is to say, it "found" that it could not make "a finding", and obviously there is nothing here to constitute res judicata.

 

(b) The judgment which was given in the previous case does not constitute res judicata in respect of the second claim, since the parties in the first case are not identical with those in the second, hence the application in the new case has not yet been decided.

 

4. As to the first argument, the learned appellant erred and did not really understand what was said in Felman (1). There the Supreme Court distinguished between a plea of real res judicata based on article 1837 of the Mejelle, and a plea of "estoppel by matter of record" based on the Common Law. When a defendant in the second case relies on the fact that the same question has already been dealt with and decided in the previous case between the same parties and pleads the Common Law estoppel, the plea will not be heard unless the determination of the question ended with a positive finding and not in "I did not find anything". But when the plea is that a real decision has already been given on the same application, now brought once again in the second case, then there is no practical difference at all whether the application was previously dismissed because of a positive finding of the judge, or whether it was dismissed because it was not proven. Article 1837 of the Mejelle does not recognise this distinction. The outcome, therefore, is that the principal question before us is the accuracy or inaccuracy of the second argument of the appellant. For should we hold the two claims identical, that will obviously serve as a complete answer, to the first argument as well.

 

5. And as to the second argument, it is true that the rule is that no judgment given in a case between A and B constitutes res judicata in respect of a claim between A and C. But "one cannot learn anything from generalities", because there is no rule which does not have its exception (other, perhaps, than this rule itself). And the exception to the above rule is when B was an employee directly responsible for the injurious act, and C is vicariously liable for that act. Here the law is as follows: if B is found liable, the judgment is not res judicata in respect also of C, but if he is not found liable, then the non-liability also constitutes res judicata in respect of a subsequent claim made against C, the employer. Preliminary support for that is found in the judgment of Sussman J. in Ramat Gan v. Pardes Yanai (2) at 1813, which was cited by the learned District Court judge and which reads as follows:

 

"When we say that the above rule of 'reciprocity' directs us to reject the plea of res judicata, it did not escape us that sometimes a party can enjoy the fruits of a previous case, and if the opposite were decided, then the judgment would not concern him. What is involved are cases in which a person's liability is only derived from that of another, such as the responsibility of an employer for the act of his employee. The employee's liability in a claim for damages will not prevent the employer from denying the responsibility of the employee, where the employer was not a party in the first case, whilst exoneration of the employee in the case will also clear the employer from liability, even if he was not a party."

 

            The ratio of this exception is patent. The direct responsibility of the employee is the basic foundation of the derivative responsibility of the employer: without an agent there is no principal. Hence there exists here identity between the two claims, although the names of the parties differ.

           

            But why does the idea not operate equally when the employee is found liable in the first case: The answer is, in my opinion, practical and simple. If the employer is made liable, without any new judgment, on the basis of the employee's liability as found in the previous judgment, the door will be opened to collusion and fraud. The employee will connive with the injured plaintiff, be found liable and divide with the plaintiff the spoil obtained from the claim against the employer. This apprehension naturally does not exist when the employee is not found liable. Thus we return to the basic idea, that when the ground gives way (the claim against the employee) the supercumbent building also collapses (the claim against the employer).

           

            This special exception was recently confirmed by Sussman J., Landau J. and Halevi J. in Zucker v. Leibovitz (3). It has also been adopted in American case law, where in a series of decisions it has been held that the general principle that a person cannot take advantage of a judgment by way of estoppel unless he would be involved in the judgment, if the opposite had occurred, but subject to several exceptions, one of which is that in claims for damages, when the defendant's responsibility necessarily depends on the guilt of another who is the immediate tortfeasor, and in the previous claim against the latter for the same act, it was held that he is not guilty, then the defendant can derive benefit from that judgment as estoppel. although he would not have been involved, if the opposite had occurred: Portland Gold Mining Co. v. Stratton's Independence (8).

 

The Portland case, which was mentioned also in the above judgment of Sussman J., is the first case which summarises the law current in earlier American cases and was followed in later cases: Bigelow v. Old Dominion Copper Co. (9), cited in Prichard v. Nelson (10) at 510; cf. King v. Stuart Motor Co. (11) at 729-30; Weekly v. Pennsylvania R. Co. (12) at 900.

...

"If a defendant's responsibility is necessarily dependent upon the culpability of another, who was the immediate actor, and who, in an action against him by the same plaintiff for the same act, has been adjudged not culpable, the defendant may have the benefit of that judgment as an estoppel."

 

(30A Am. Jur., Judgments, para. 425; 52 Am. Jur., Torts, para. 129; cf. 50 C.J. Sec., para. 757, at p. 279.)

 

            I have restricted myself to the question which directly concerns the case before us. whether a judgment exonerating the employee serves as res judicata in an action against the employer; I have not touched upon other aspects of the question, such as how a condemnatory judgment is treated and how the concept of res judicata works between joint tortfeasors; the latter question was dealt with extensively by Halevi J. in Zucker (3). In English case law, to the best of my knowledge, there is no express decision regarding the question arising before us, although there is case law on the relationship of res judicata between joint tortfeasors.

           

            I have seen no need to enter into the remaining submissions of the appellant because they are without substance.

           

            In my opinion therefore the appeal is to be dismissed without costs.

           

HALEVI J..                In Zucker (3), we held in an "opposite" case (where the employer was first sued for vicarious liability for the wrongful act alleged against his employee and the plaintiff failed to prove the wrongful act) that the plaintiff was free to sue the employee for committing the act and to try and prove it, and the judgment given in favour of the employer does not constitute res judicata as regards the employee which bars the action against him. In the present case. however, in which the employee was first sued for a wrongful act attributed to him by the plaintiff (the appellant) and she failed to prove the act, we rule that the appellant is not at liberty to sue the employers (the respondents) for vicarious liability, and that the judgment in favour of the employee constitutes res judicata which bars the action against them. What is the reason for the difference in law between this case and its opposite?

 

            The reason is that the vicarious liability of the employer springs from the employee's liability, and the employee's liability does not spring from the employer's liability. This substantial difference has two consequences:

           

(a) American jurists and courts are united in the view that a judgment which, on the merits of the case, exonerates a person from a wrongful act attributed to him by the plaintiff, bars an action of the same plaintiff against another person, which is based exclusively on the vicarious liability of the second defendant for the wrongful act, for which the first defendant was acquitted. Although had the first defendant been held liable, the judgment would not be evidence, and needless to say res judicata, against the second defendant, because the judgment would be res inter alios acta and "one cannot render a person liable except in his presence". An act may, however, be done in favour of a person even when he is not present (Baba Metzia, 12b), and therefore the reciprocity rule may be departed from for reasons of "public order": interest rei publicae ut sit finis litium. The plaintiff has had his "day in court", and not having proved the wrong in his action against the direct actor, he is not to be permitted to try his luck again in an action against the person vicariously liable. Added to these principal considerations, there is the further consideration in most cases that it would not be justified to expose the first defendant. already exonerated in the plaintiff's claim, to a claim for indemnity on the part of the second defendant. in the event of the latter being condemned to pay damages to the plaintiff for the same wrongful act, of which the first defendant was cleared. For all of these reasons, we regard the rule, that a judgment which exculpates the immediate actor from a wrongful act, is res judicata for the person vicariously liable. a reasonable and just development of the Common law and we in fact adopt it.

 

            As to the "opposite" question. whether a judgment in favour of the person vicariously liable is also res judicata for the immediate actor, lawyers and the courts in the United States have not yet reached an unanimous view. At least one of the aforementioned considerations - exposing the first successful defendant to a claim for indemnity by the second defendant - does not generally apply to the "opposite" case. In Zucker (3), we left the question open for the time being.

           

(b) The specific Israeli case law (which in my opinion has no parallel at all in English and American judgments) that limits the action of "estoppel by res judicata" to "a positive finding", as distinct from "lack of finding". is important (or might be important) only in the "opposite" case and does not apply to the "direct" case dealt with here. I will explain,

 

            I shall not resort to article 18 37 of the Mejelle, because with all respect I join in the opinion of Landau J. in Mizrahi v. Rahamim (4), that this article "has become obsolete". But I actually come to the same conclusion as my learned colleague, Silberg J., on the basis of the Common law distinction between res judicata as a "bar" and res judicata as "collateral estoppel". See Freeman, Law of Judgments (5th ed.) Vol. II, paras. 546, 676; Restatement of Law of Judgments sec. 68, p. 293. The difference is, briefly and in so far as it concerns us here, that any judgment on the merits of the case in favour of a defendant, be "its findings" or "lack of findings" what they are, will "bar" every further action by the plaintiff against the detendant for the same cause of action, and will serve as a complete defence to the action. Furthermore, "collateral estoppel" is set up by the express or implicit decision of the judgment as to the facts in dispute between the parties; that decision will serve as "an estoppel" between the parties in any further case, no matter what the cause of action may be. An exception: a decision of a court under its "incidental" jurisdiction, under sec. 35 of the Courts Law, 1957, in a matter under the "exclusive jurisdiction of another court or tribunal": such decision is only valid "for the purposes of that matter" and cannot serve as "collateral estoppel"; Cohen v. Cohen (5); Restatement. para. 71 p. 326. Another exception is created by Israeli case law (Felman (1); Amrani v. Attorney-General (6): Ma'aravi v. Attorney General (7); Zucker (3) etc.). which limits the applicability of "collateral estoppel" to "a positive finding", as distinguished from "lack of a finding". This last distinction does not apply to "barring" operation of a judgment (or, in the case of a judgment in favour of the plaintiff as a "merger"), as appears, with difference in terminology only, from the observations of Silberg J. in Felman (1) at 324 and of Berinson J. in Amrani (6) at 599.

 

In the case before us, the judgment in favour of the employee acts as a "bar" in favour of the employer. The vicarious liability of the employer springs from the principal liability of the employee, and when there is no such principal liability there is no attached (vicarious) liability. No "finding" or "lack of finding" in the judgment, but the very exculpation of the employee of commission of the wrongful act against the plaintiff-appellant removes the ground from under the claim which is based on vicarious liability for the same wrongful act, and serves as a full defence to the respondents. Accordingly the appeal should be dismissed.

           

WITKON J                 I concur with the conclusion reached by my respected colleagues.

 

            Appeal dismissed.

            Judgment given on June 21, 1964.

Crim. A. 35/52

 

SHALOM ROTENSTREICH

v.

ATTORNEY-GENERAL

 

 

In the Supreme Court sitting as a Court of Criminal Appeal.

[February 12, 1953]

Before: Cheshin J., Assaf J., and Silberg J.

 

 

Criminal Law - Causing death by negligence - Children playing near dangerous pool - Duty of care towards trespasser- Criminal Code Ordinance, 1936, s. G18 - Criminal and civil responsibility - Israel and English Law - Jewish Law.

 

                The appellant was convicted under s. 218 of the Criminal Code Ordinance, 1936 1) of causing the death of two small children. The children, though warned not to do so, had been in the habit of bathing in a pool on the appellant's land. The two children had in fact on a previous occasion been driven off and warned not to go near the pool. Nevertheless they disregarded the warning, went into the pool, and were drowned.

 

Held:            Allowing the appeal, per Cheshin J. and Assaf J., that the elements necessary for criminal liability under s. 218 of the (criminal Code Ordinance, 1936, are the same as those for civil liability under the English law of torts.

 

            Since in the present case the children were trespassers and there had been no breach by the appellant of this duty he had been wrongly convicted.

         

            Held further by Assaf J. that the principles of Jewish law led to the same result.

         

            Per Silberg J. (dissenting) that the elements of criminal liability under section 218 of the Ordinance are not the same as those of civil liability under the English law of torts. In the present case it had been positively determined that the death of the children was caused by the negligence of the appellant within the meaning of s. 218 and the fact that they, the children, were trespassers, did not exempt him from criminal liability under that section.

 

Israel case referred to:

(1)        Cr. A. 158/51- B-Z. Shvili v. Attorney-General of Israel, (1952) 6 P.D. 470.

 

English cases referred to:

(2)        Excelsior Wire Rope Company Ltd. v. Callan and Others, (1930) A.C. 404.

(3)        Grand Trunk Railway Company of Canada v. Walter C. Barnett, (1911) A.C. 861.

(4)        Lowery v. Walker, (1910) 1 K.B. 173; (1911) A.C. 10.

(5)        Cooke v. Midland Great Western Railway of Ireland, (1909) A.C. 229.

(6)        Latham v. R. Johnson and Nephew, Limited, (1913)  1 K.B. 398.

(7)        Jenkins v. Great Western Railway, (1912) 1 K.B. 525.

(8)        Hardy v. Central London Railway Company, (1920) S K.B. 459.

(9)        Robert Addie and Sons (Collieries) v. Dumbreck, (1929) A.C. 358.

(10)      Morton v. Poulter, (1930) 2 K.B. 183.

(11)      Buckland v. Guildford Gas, Light and Coke Co., (1948) 2 All. E.R.1086.

(12)      Edwards and Another v. Railway Executive, (1952) 2 All E.R. 430.

(13)      R. v. Percy Bateman, (1925) 19 Cr. App. RC. 8.

(14)      R. v. Nicholls, (1874) 13 Cox C.C. 75.

(15)      R. v. Doherty, (1887) 16 Cox C.C. 306.

(16)      Andrews v. Director of Public Prosecutions, (1937) 26 Cr. App. R. 34.

(17)      Younghusband v. Luftig, (1949) 2 K.B. 354.

(18) E. Gautret. Administratrix of Leon Gautret, deceased v. Egerton and Others; L. Jones, Administratrix of John Jones, deceased v. Egertorn and Others, (1867) L.R. 2 C.P. 371.

 

American case referred to:

(19)      United Zinc and Chemical Co., v. Britt et ux., (1921) 42 Sup. Court Rep. 299.

 

Bar-Shira and Eliad for the appellant.

Ben-Shabtai, Deputy State Attorney, for the respondent.

 

            SILBERG J.  On August 23, 1950, between 3 and 3.15 p.m., the bodies of two children aged eight and nine were taken from the pool which is in the grounds of the industrial plant, "Even Ve-Sid", at Ramla. They had come to bathe in the pool, where they were drowned. The manager of the plant, Shalom Rotenstreich, was charged in the District Court of Tel Aviv with "causing death by want of precaution", under section 218 of the Criminal Code Ordinance, 1936. He was convicted, and sentenced to three months' imprisonment. His appeal before us is against both the conviction and sentence, and his main contention is that the act - or, more precisely, the omission - imputed to him, does not amount to an offence under the said section.

           

2.         The main facts are not in dispute, and are as follows: -

            The pool measured eight to eight metres, the depth of the water was about a metre-and-a-half, and it served as a water-reservoir for the industrial plant. The grounds of the plant as a whole were unfenced and open, but the pool itself was surrounded by a low wall (in the court below described as "a railing"), and its height was 60 centimetres. The pool was built on the top of a small rise, and steps on each side led from the foot of the rise to the railing, and from the railing to the water and the bed of the pool. On one side the pool adjoined the open grounds of the plant, and on the other side it was bounded by the road. The children of the neighbourhood were in the habit of coming to bathe in the pool, from the grounds of the plant or from the road, but the persons in charge of the plant were not happy about these visits, and whenever they came upon the children, they would scold them and drive them away from the vicinity of the pool. These same children, the victims of the accident, had also been driven away once before by the plant watchman. However, like their other friends, they did not heed the watchman's warnings, but as often as they were turned away, they came back. There was no special watch on the pool, and the watchman whose duty it was to keep watch over the whole area of the plant used to come to work at 5 p.m., and stay there until 7 in the morning. The accident occurred at approximately 3 p.m., at which time there was no watchman, either in the grounds of the plant or at the pool. It follows from the findings of the learned judge that it would have been possible to prevent the accident if there had been an efficient and proper watch at the approach to the pool, or if the wire-netting that was spread out over the pool after the accident, had been placed there earlier.

 

            The court below held that the children who were drowned were trespassers, but it nevertheless convicted the appellant of an offence under the said section. The learned judge drew an analogy between the rules of civil and criminal law: he reviewed the well-known English judgments given in actions in tort, brought by a trespasser (or his successor) in respect of an accident in which he had been injured or killed while entering upon private property. The court found that the accepted view until 1930 had been that the owner was not liable for injury to a trespasser unless the injury was intentional, or had been caused by something similar, but in that year, in the case of Excelsior Wire Rope Co. v Callan (2), it was held that the owner is liable for injury to a trespasser, even where the injury is caused not by an act but by an omission involving an element of reckless disregard as to the fate of the trespasser. In the present case, the learned judge concludes, "the accused is guilty of such disregard. He was well aware of the danger to children using the pool. He knew that the means he had employed were not sufficient, even though it was possible for him to employ adequate means", and so forth.

           

3. It seems to me, with all due respect, that this view is erroneous for two reasons: -

 

            (a) The English rule was not changed in the Excelsior case (2), but remained as it had been before that judgment was given;

           

            (b) More important, a civil claim for the payment of damages is not the same as a criminal prosecution - I would add, in particular, the criminal prosecution for an offence under section 218 - and, as we shall see, the one cannot be understood by reference to the other, whether by way of analogy or by way of inference a fortiori, neither as favouring liability nor as exempting from liability.

           

4. Let me start by dealing with the first question, that of the liability in the English law of torts of the owner of property towards a trespasser, and in particular towards a trespasser who is a child. I refer to the English law of torts, and not the Palestine Civil Wrongs Ordinance, 1944, since if there is found to be any difference between them, we must prefer the English law for the simple reason that the Criminal Code Ordinance, 1936, preceded the Civil Wrongs Ordinance, 1944, and in any event the 1944 Ordinance cannot serve as a source of interpretation of the terms and concepts of the Criminal Code Ordinance.

 

5. The following are the leading judgments in which the above-mentioned question of liability was dealt with at some length. They are not all of equal value and importance, but taken all together, and noting the differences between them, we get a clear and comprehensive picture of the English doctrine on this interesting and very important question. The judgments are : -

 

            (a) The judgment given by the Privy Council in the case of the Grand Trunk Railway Co. of Canada v.. Burnett (3). That was a claim for damages against a Canadian railway company for bodily injuries to a person whose hands had been amputated in a train collision, caused by the negligence of the company's employees. It was held that the plaintiff was a trespasser - in contravention of the by-laws, and without a ticket, he had climbed on to the platform of a coach which was altogether unconnected with any passenger train - and the Privy Council held that the company was not liable to pay damages. The Canadian court had thought otherwise, and there is some ground for its view. It stated :

           

"The personal safety of a human being (though he be a trespasser) must not be endangered by the negligent act of another. Given the circumstances of this case, it does not seem. . . . . that the defendants are exempt from liability though the plaintiff was nothing else than a mere trespasser." (ibid., p. 369).

           

            But the Privy Council was not content with that view; it reversed that judgment and, as was said shortly and simply by Lord Robson:

           

            "The general rule..... is that a man trespasses at his own risk." (ibid., p. 370).

           

            However - and at this point there is a certain withdrawal from the wide pronouncement quoted above - the learned judge said : -

           

            "Again, even if he be a trespasser, a question may arise as to whether or not the injury was due to some wilful act of the owner of the land involving something worse than the absence of reasonable care. An instance of this occurred where an owner placed a horse he knew to be savage in a field which he knew to be used by persons as a short cut on their way to a railway Station : Lowery v. Walker (4). In cases of that character there is a wilful or reckless disregard of ordinary humanity rather than mere absence of reasonable care." (ibid.)-

 

            (b)        The well known judgment of the House of Lords in the case of Cooke v. Midland Great Western Railway of Ireland (5). That judgment is of particular interest, for prima facie it is possible to infer from it (and indeed judges in later cases did so erroneously infer), that the liability of the owner towards the trespasser, particularly if he is a child, is not necessarily limited to a wilful or reckless act on the part of owners - and, as is well known, the "binding force" of decisions of the House of Lords as precedents is greater than that of opinions of the Privy Council (see Halsbury, Hailsham Ed. Vol. 19, p. 258, and the cases there cited). But the position is not so : there is, as appears below, no inconsistency between the two. The facts in that case were that a child of tender years (about four years old) was seriously injured while playing on a railway turntable belonging to the railway company. The accompanying circumstances were these : the turntable was situated on a triangular plot of ground belonging to the defendant company; it was closed off by a broken thicket hedge, and the children were in the habit of going through this gap on to the plot of ground in order to amuse themselves on the turntable.

 

Lord MacNaghten said (at pp. 585, 286) :-

 

            "It is proved that in spite of a notice board idly forbidding trespass it was a place of habitual resort for children and that children were frequently playing with the timber, and afterwards with the turntable."   Now the company knew, or most be deemed to have known, all the circumstances of the case and what was going on. Yet no precaution was taken to prevent an accident of a sort that might well have been foreseen and very easily prevented. They did not close up the gap until after the accident... They did not have their turntable locked automatically in the way in which it is usual to lock such machines... 1 think the jury were entitled, in view of all the circumstances, on the evidence before these, uncontradicted as it was, to find that the company were guilty of negligence."

 

            It is not possible to know from that somewhat vague language how the noble lord regarded these children - as licensees or trespassers. His remark about the "idle" prohibition of the notice board does not teach us very much, and it may be read either way. That judgment is, however, if one may so put it, "poor in parts and rich in others", and the answer can be gleaned from the words of the other judges. For example, Lord Atkinson said (at p. 239):

           

"...I think that there was evidence proper to be submitted to the jury that the children living in the neighbourhood of this triangular piece of ground, of which the plaintiff was one, not only entered upon it, but also played upon the turntable - a most important addition - with the leave and licence of the defendant company.''

 

            From the considerable importance that Lord Atkinson attached to the element of "leave and licence" it may be inferred that he sees in it the principal basis of his decision. Lord Loreburn L.C. also notes that the defendants "took no steps either to prevent the children's presence or to prevent their playing on the machine" (see p. 242), and in that he concurs, so he says, with Lord MacNaghten in his opinion. Lord Collins goes further in this direction than all of his colleagues. He stresses the fact that the turntable was situated "in such a conspicuous place, and frequented so largely by young people without remontrance by the defendants", and he also notes the gap in the fence that "called" to these youngsters; and he is prepared to conclude therefrom that the children were not only licensees, but were even within the category of invitees (see p. 241).

           

            It follows that while interesting things were said in it here and there about the mischievous and recalcitrant nature of the children, and of the danger of allurement concealed in the dangerous machines that attracted them, the fundamental basis and the main ground of the judgment was that, taking into account all the circumstances of the case, including the mischievousness and the recalcitrance and the allurement, the injured child was regarded, if not a real "invitee", at least a "licensee" of the company in question, and for that reason the company was held liable in damages. For, but for this fact, there was no ground for holding the company liable, since it had not done an act, willful or reckless, to endanger the child's life. Indeed, that was how that judgment was interpreted in the judgment given some years later by the Court of Appeal. I refer to Latham v. Johnson (6), where Hamilton L.J. says (at p. 417) :

 

            "The Court of Appeal in Ireland ...declined to regard it (the reference is to Cooke's case (5), above) as a case on the duty of an owner or occupier of property towards a trespasser... In Jenkins v. Great Western Railway (7), in this Court, all the members of the Court... stated that in their opinion Cooke's case (5) was decided on the assumption that Cooke was licensed by the railway company not merely to come upon the land, but to play with the turntable."

 

            (c) The judgment of the Court of Appeal in the case of Hardy v. Central London Railway Co. (8). This case was also about a railway accident, this time on an underground railway, and the victim was a five year old boy, whose hand was mutilated while playing with the belt that operates the escalators up and down from the booking hall to the passengers' platform. The remaining details closely resemble those of the present case. The children of the neighbourhood were in the habit of running up and down the escalators and the company knew that; station officials would drive the children off whenever they saw them, and the children would return when they were not seen. This particular child, Hardy, was driven away from there by a policeman shortly before the accident took place. The legal question was whether, in the light of these facts, the children were to be regarded as licensees or as trespassers, and the Court of Appeal's reply, in contradistinction to that of the Judge of first instance, was that they were trespassers. Thus, Bankes L.J. said (at p. 466):

           

            "I can conceive of warnings to children so ineffective, either from their nature or from the absence of any attempt to enforce them, as to convey to the mind of a child the impression that no real objection was taken to what was being done. In such a case it might be possible to draw the inference that the child was allowed to be and remain under the impression that it had permission to do what it was doing... (some examples are then cited) ...The present case is not one in which, in my opinion, any inference of licence can be drawn. I come to the conclusion upon the evidence that the children were all of them fully aware of the fact that they had no right to be, and no business to be, where they were. In other words, that they were trespassers. "

 

The learned judge quotes the words of Hamilton L.J., in the case of Latham v. Johnson (6) :

 

            "It is hard to see how infantile temptations can give rights, however much they may excuse peccadilloes. A child will be a trespasser still, if he goes on private ground without leave or right, however natural it may have been for him to do so."

 

            Then Scrutton L.J., in the same case, after completely rejecting the argument of how alluring and attractive these moving stairs are to little children, holds - if one may put it this way - that an allurement does not give rise to a licence and that, in view of the company's unrelenting objection to their visits, those children were trespassers and not licensees, and accordingly said (at pp. 473, 474) :

           

            "...The landowner was not entitled intentionally to injure them, or to put dangerous traps for them intending to injure them, but was under no liability if, in trespassing, they injured themselves on objects legitimately on is land in the course of his business. Against those he was under no obligation to guard trespassers."

 

            (d) The judgment of the House of Lords in the case of Addie and Sons v. Dumbreck (9). In this case the House of Lords followed the theory of the judgment in Hardy's case (8), and dwelt on the principles to be applied to the question of the owner's liability towards the trespasser. The facts were these:

           

            A four-year-old child was injured and died of its injuries while playing with a wheel connected by a moving cable to the hauling apparatus of a coalmine. This was worked electrically from the grounds of the mine, and was not visible from the place where it was being worked. The wheel was in a field surrounded by a fence, the gaps in which were more numerous than the parts in good repair, and strangers, youngsters and adults, would go in and out of it, whether to take a short cut or to play games. The company objected to strangers coming upon the premises, and their officials would remonstrate with the adults and warn the youngsters not to go there. From these facts the House of Lords, unlike the Court of Appeal, concluded that the children were trespassers, and relieved the company from paying damages. The finding of fact in the case is not relevant for our purposes. Nor us the importance lies in the legal ruling laid down concerning liability for the trespasser's injuries. Lord Hailsham L.C. said (at pp. 864, 365) :-

 

"The first and in my opinion only question which arises for determination is the capacity in which the deceased child was in the field and at the wheel on the occasion of the accident. There are three categories in which persons visiting premises belonging to another person may fall; they may go

 

1)      by the invitation, express or implied, of the occupier ;

2)      with the leave and licence of the occupier; and

3)      as trespassers.

 

            "The duty which rests upon the occupier of premises towards the persons who come on such premises differs according to the category into which the visitor falls. The highest duty exists towards those persons who fall into the first category, and who are present by the invitation of the occupier. Towards such persons the occupier has the duty of taking reasonable care that the premises are safe.

           

            "In the case of persons who are not there by invitation, but who are there by leave and licence, express or implied, the duty is much less stringent - the occupier has no duty to ensure that the premises are safe, but he is bound not to create a trap or to allow a concealed danger to exist upon the said premises, which is not apparent to the visitor, but which is known - or ought to be known - to the occupier.

           

            "Towards the trespasser the occupier has no duty to take reasonable care for his protection or even to protect him from concealed danger. The trespasser comes on to the premises at his own risk. An occupier is in such a case liable only where the injury is due to some willful act involving something more than the absence of reasonable care. There must be some act done with the deliberate intention of doing harm to the trespasser, or at least some act done with reckless disregard of the presence of the trespasser."

           

            Such is the rule of liability - or more precisely, the rule of absence of liability - of the owner or occupier towards the trespasser in the English law of torts. It has not since altered, as we shall see, and English case-law has not moved from that position to this day.

 

            (e) And now we come to the judgment of the House of Lords in the case of Excelsior Wire Rope Co. (2), the case in which the learned judge of the court below thought that there was an important doctrinal development and revision in relation to the principle expressed a year previously, with unsurpassed clarity, in the Addie-Dumbreck case (9), referred to above. But, as I have already indicated, the position is not so, as will appear from a careful scrutiny of the details of the case. The headnote to the case published in the Law, Reports is not accurate and is liable to mislead, as happened with the headnote in Cooke's case (5), which led many worthy judges astray, and nearly lead to the reversal of the clear ruling there laid down (see the remarks of Bankes L.J. in Hardy's case (8), at p. 467).

           

            The facts in that case were as follows:-

            A company engaged in the manufacture of wire rope established its plant near the railway. It connected the plant to the railway lines by a siding, and moved its wagons over the rails by means of a long wire rope which passed around a pulley, set up on someone else's plot of land under licence from the owner (the Marquess of Bute). A dynamo in the factory worked the pulley for a few minutes three times a week. The fence round the plot of land had "disappeared" and the children of the neighbourhood had their eye on that plot of land as a playground for themselves, and would go and "handle" the pulley-wheel. The company's employees did not disturb the children in their games on the plot of land or prevent them from getting to the wheel, and would turn them away from there only when the wheel was working and the wagons were in motion. On the day of the accident, when they were about to move a wagon, one of the workers, as was his custom, went to the wheel and drove the children away from there. But on that occasion the man was in no hurry to work the dynamo and delayed some twenty minutes before doing so (see the account of the facts as reported in 142 L.T.R. at p. 532).  Meanwhile the children had time to get near the wheel again and one four-year-old girl began to swing on the rope. The worker did not notice what she was doing because he did not look in her direction and, when the dynamo was started and the wheel began to turn, the girls hands were caught in the wheel or the rope and she was severely injured, together with her brother who rushed to her aid.

 

            A claim for damages against the company was made by the children's father. The judge of first instance held in favour of the plaintiff by deciding that the children were licensees; the judges of the Court of Appeal, including Scrutton L.J., confirmed the judgment, but not on the same ground as the judge below. They held that the children were trespassers and not licensees, yet nevertheless the company was liable to pay for the injury since it had been caused "by an act done by the appellant's servants with reckless disregard of the presence of children" (see pp. 405, 406). The House of Lords confirmed the judgment of the Court of Appeal, but it is not clear whether on the ground given by the latter, or on the ground given by the judge of first instance, or on a ground combining and fusing the two together, and I incline in fact to the last version. The judges of England, especially those of superior courts, are wont to ride several horses at once because of their strenuous - in my opinion somewhat exaggerated - efforts to limit the scope of their decisions to the facts of the particular case before them. The real reason for the decision was, if we want to be absolutely accurate, that there was no prohibition imposed on the children to be near the wheel when it was not working; their presence there was, therefore, permitted, and the company's servants were accordingly bound to see that they were sent away from there the moment they started working their dynamo, and not to rely on the check made by them twenty minutes earlier. That was the ground of the decision in Excelsior Wire Rope Co. Ltd. v. Callan (2), and that is what, in my opinion, distinguishes it from the facts in Addie's case (9). This is how Lord Buckmaster summed up the matter (at p. 410) :-

           

            "To the knowledge of the Excelsior Wire Rope Company these children played uninterruptedly round this post (the reference is to the post to which the pulley-wheel was affixed); there was nothing to prevent them doing it, and I cannot find that there is any evidence to show that, except at the moment when this machine was going to be set in action, they were ever driven away. It was therefore well known to the appellants that when this machine was going to start it was extremely likely that children would be there and, with the wire in motion, would be exposed to grave danger."

 

            In the judgment of Lord Warrington of Clyffe we read (at pp. 411, 419):-

           

            "There is ample evidence that, to the knowledge of the servants of the appellants, children were in the habit, not only of playing around this sheave and using it for purposes connected with their games, but were actually in the habit of playing with the machine, and the ropes and so forth attached to it, so that it was found necessary, when they were about to use the machine, to see that it had not been put out of gear by the children. Under those circumstances, it seems to me quite plain that there was a duty upon the present appellants, by their servants, when they were about to put this machine in motion, so that it would become a danger to any children who might be in the neighbourhood, to see whether or not at that moment there were children in such a position as to be exposed to danger".

 

            And a passage from the speech of Lord Thankerton (at p. 414) :-

           

            "...the children not only had constant and free access to the machine itself, but clearly to the knowledge of the appellants they were in the habit of interfering and playing with both the post and the wire rope, and it was only when the occasion of putting the machine into operation arose that there was any question of keeping the children away from that spot".

           

            That was the ratio decidendi in the judgment given in that case by the majority of the judges in the House of Lords, and only Lord Atkin, in his short judgment, sees the matter apparently in a different light, and determines the responsibility on the basis of the fact that the company was not itself the owner, and not even the occupier, of the plot of land; it was only licensed by the Marquess of Bute to put up the post with the wheel there, and so its liability towards the injured person was greater than that of the owner or of the occupier (see pp. 413, 413).

           

            In analysing the common ratio of the majority judges as aforesaid, and in trying to endow it with a more fundamental character, we find - so it seems to me - that there is a certain combination and fusion of both the notion of "licence" and the notion of "the reckless act". The children were allowed to be by the wheel; therefore it was a reckless act on the part of the company's servants to start the dynamo and the wheel without first ascertaining whether or not there were in fact children there at that very moment. But for that fact, that is to say. if the children had been forbidden to be on the spot at all, as happened in Addie's case (9) , it would have been neither a wilful act nor a reckless act on their part to set the said wheel in motion.

           

            And that very problem, namely, In what way Addie and Sons v. Dumbreck (9) differs from Excelsior Wire Rope Co. Ltd. v Callan (2), was dealt with by Scrutton L.J. in his judgment in Mourton v. Poulter (10), at p. 190. In the opinion of Scrutton L.J., the difference between these two cases is that in the first case a small hillock separated the wheel from its operators, and from where they stood they could not see the wheel and the children, whereas in the second case the starting signal was given at a distance of twenty yards from the wheel, and the man could have seen the children had he bothered to turn his head. However, it seems from what the learned Lord Justice immediately went on to say that he was not so certain of the correctness of this distinction - and rightly so - since there is no real basis for the factual distinction in the points that were emphasized in the latter judgment. Nevertheless, even if one assumes that that is indeed the correct distinction, that is still no authority for the view that, with the giving of the judgment in Excelsior v. Callan (9), the owner's liability towards the trespasser was broadened in principle, and that it henceforth extends (as the learned judge in the court below thought) also to an omission involving reckless disregard of the presence of the latter. For even in Excelsior v. Callan (2) there was no omission but a positive act, since the child was injured by the setting of the wheel in motion.

 

            Putting the matter shortly, there is nothing in the judgment given in the case of Excelsior v. Callan (9), which constitutes a development or revision of the ruling laid dozen in Addie's case (9), and the owner's (or occupier's) liability towards the trespasser still remains as it was. Its limits have not been overstepped and they are as they always were, namely, either a wilful act on the part of the owner, or an act involving reckless disregard of the presence of the trespasser. He is not liable for damage caused to the trespasser through "passive" negligence, that is to say, if he is injured by something - and the something is not dangerous - situated for some time past on the owner's land, and no new act has been done to injure the trespasser or endanger him. "As the land remains in the same state, a trespasser must take it as he finds it, and the owner is not bound to worn him." Those were the words of Scrutton L.J. himself (at p. 191) in setting out the reasons for the decision given by him in Mourton v. Poulter (10) and they also correspond to what was said by him in Hardy's case (8) (at pp. 473, 474).

           

            (f) In later judgments too we do not find any departure from that clear rule; on the contrary, we find it affirmed again and again. I shall not set out all the judgments given on this point since 1930. I shall only call attention to the remarks of Lord Morris in the case of Buckland v. Guildford Gas Light and Coke Co. (11), on p. 1092 (between the letters D and E), and to the judgment of the House of Lords in 1952 in Edwards v. Railways Executives (19), the two recent decisions to which counsel for the appellant drew our attention. It will be noted here that the rule which has been discussed above corresponds to the position in American law, as expressed in the majority judgment in the well-known case of United Zinc and Chemicals Co. v. Britt (19).

           

6.         It follows from what has been said that since in the present case there was no injurious act on the part of the owners (the pool had for some time been situated on their land, and they were not "working" it when the accident happened), and since, as the learned judge held, the children were trespassers, the negligence of the present appellant - the "passive" negligence as we have called it - does not make them liable for the payment of damages. And the conclusion that follows is that, if the view is sound that the criminal negligence required for a conviction under section 218 must be of a degree greater, or at the very least no less, than the civil negligence required for making a person liable to pay damages, the learned judge ought to have acquitted the appellant.

           

7.  I said if the view was sound, and with that we have reached the second, perhaps most important, question in this appeal. From what is said in paragraph 9 of the judgment of the court below, it seems that the learned judge was not entirely at case about the analogy between the rules of criminal and civil law - notwithstanding the fact that he made it the basis of his judgment. The problem is by no means an easy one, and we still lack precedents to guide us on to the correct path. In Shvili v. Attorney-General (1), Cheshin J. commented obiter, "that these factors (he is referring to the terms of the offence under section 218) are to a certain extent identical with the elements required to prove civil liability in an action arising from manslaughter by negligence in English law," but since there was no need for deciding the matter in that case, he did not go deeply into the problem, and did not explain to what extent they are identical with those factors. At all events, the very expression "to a certain extent" points - so it seems to me - to the lack of a complete resemblance between the two matters mentioned.

           

8.  Let us take a look at the wording of the section, exactly as it is written in the original English : -

 

"218. Any person who by want of precaution or by any rash or careless act, not amounting to culpable negligence, unintentionally causes the death of another person, is guilty of a misdemeanour and is liable to imprisonment for two years or to a fine of one hundred pounds."

...........................................................................

 

            It is quite plain that not every want of precaution and not every rash and careless act which causes death, is sufficient to convict a person of an offence under section 218. They must be of a certain "degree", and not too great; the act must involve negligence, and must not involve culpable negligence. I shall not enquire here where the borderline is to be drawn between the two, for I know that one cannot accurately fix its exact position. It is a question of degree, and the matter is left to the judge who hears the case. But one may certainly ask - and that is the question which interests us in this appeal : what is the relation between civil liability and criminal liability, and can the matter be put by saying that negligence which, for whatever reason, does not involve civil liability to pay damages, entails criminal liability for an offence under the section?

           

9. Now the question has apparently - and I stress the word apparently - been considered countless times in the English courts, and has been completely solved there, although the solution is not clear. Thus we read in the well-known judgment of Lord Hewart in R. v. Bateman (13), (at p. 16) :-

 

". . . . . the explanation of criminal negligence to a jury should not be a mere question of epithets. It is, in a sense, a question of degree..... but there is a difference in kind between the negligence which gives a right to compensation and the negligence which is a crime".

 

            And what is the difference? As to that, it is stated in an earlier passage (at p. 11) :-

           

". . . . . in order to establish criminal liability the facts must be such that, in the opinion of the jury, the negligence of the accused went beyond a mere matter of compensation between subjects and showed such disregard for the life and safety of others as to amount to a crime against the State. . . . ."

 

            So the "felonious intent" or mens rea, in the classical, and not the modern, meaning of the term, is the criterion of criminal responsibility, as distinct from civil liability, and that is the substantial difference arising from the distinction between the two categories of negligence.

           

            A similar idea had been expressed fifty years earlier by Brett J. in the case of R. v. Nicholls (14). A small child, the illegitimate son of a young spinster, died from lack of adequate nourishment, and his grandmother, who had voluntarily taken upon herself to maintain him, was put on trial on a charge of manslaughter by negligence, and acquitted. The instructions of Brett J. to the jury were (at p. 76) as follows :

 

"..... Mere negligence will not do, there must be wicked negligence, that is, negligence so great, that you must be of opinion that the prisoner had a wicked mind, in the sense that she was reckless and careless whether the creature died or not."

 

            Similarly, in the charge of Stephen J. to the jury in the case of R. v. Doherty (15), we come across a concept, also dealing with the state of mind of an accused person, although it is not so clearly expressed.

           

". . . . . Manslaughter by negligence occurs when a person is doing anything dangerous in itself......and conducts himself in regard to it in such a careless manner that the jury feel that he is guilty of culpable negligence, and ought to be punished. . . . . But if there was only the kind of forgetfulness which is common to everybody, or if there was a slight want of skill, any injury which resulted might furnish a ground for claiming civil damages, but it would be wrong to Proceed against a man criminally in respect of such injury." (See p. 309.)

 

            Finally, one last reference, where stress was put, without pointing to the qualitative distinction which is involved, as was done in Bateman's case (13), on the "quantitative" difference - the difference of degree - between civil negligence and criminal negligence. I refer to the words of Lord Atkin in the well-known case of Andrews v. Director of Public Information (16), (at p. 47) : -

 

            "Simple lack of care such as will constitute civil liability is not enough. Nor purposes of the criminal law there are degrees of negligence, and a very high degree of negligence is required to be proved before the felony is established."

           

10. It follows from all these authorities that civil liability is not the same as criminal liability, and that the latter (in cases of manslaughter by negligence) requires, as a sine qua non, a degree of negligence far higher, or more tainted with guilt, than the negligence that suffices to impose liability to pay damages.

 

11. What then is the conclusion to be drawn from these citations as regards the question raised by me at the end of paragraph 8? Can we maintain that standard when we come to  "measure" the degree of negligence required to convict a person of an offence under section 218?

 

            My answer to that is in the negative. For the problem with which we are dealing does not correspond with the example quoted, and I therefore inserted the word "apparently" at the beginning of the ninth paragraph. All the English authorities cited dealt with a charge of manslaughter by negligence - that is, the felony, falling in our country, under certain conditions, within the scope of the offence set out in section 212; 1) whereas our concern is with the special offence set out in section 218. The drawback is that the offence in section 218 is a novelty conceived in the library of the Palestine legislator; it has no counterpart in English criminal law, and so the distinction made in the English judgments quoted above has no application.

           

            Let me explain what I mean. The offence laid down in section 218 is an exceptional offence, and its provisions and exceptions are of the most special kind. It contains two almost opposites under one heading : negligence entailing punishment, yet for all that not culpable. Whatever the exact meaning of that adjective, one thing is certain : that here the legislator did not introduce the "felonious intent", the mens rea in the classical meaning of the term. This is not one of the usual phenomena in criminal legislation; it is by its very nature exceptional, even in the criminal legislation by regulation of our generation. See the stimulating words of Lord Goddard, C.J. in the judgment given in 1949 : -

           

"Of late years the courts have been so accustomed to dealing with a host of offences created by regulations and orders independent of guilty intention that it is desirable to emphasize that such cases should be regarded as exceptions to the rule that a person cannot be convicted of a crime unless he has not only committed a forbidden act or default but also that a wrongful intention or blameworthy condition of mind can be imputed to him." (Younghusband v. Luftig (17), at p. 370.)

 

            In other words, "mens rea" - the classical "mens rea" - is still one of the fundamental properties of criminal legislation, apart from those special cases where the legislator deliberately dispenses with it. Section 218 is one of the cases where the legislator has waived this important condition; he had his reasons, though he did not disclose them to us. The citizen is thereby given a special warning to take particular care with regard to other people's lives and not to do anything, even unknowingly, which endangers the life of a fellow-being. If a person is not careful, and a man loses his life, he gets his punishment as a warning to others not to make the same mistake again. The meting out of punishment here is, if one may say so, a precautionary measure employed by the legislator to safeguard the citizen's life against want of precaution on the part of his fellow-citizens. If such is the case, if that indeed was the intention and aim of section 218, there is no logic in the special criminal liability under this section being dependent upon and adjudged according to the terms and exceptions of civil liability.

 

            But then it may be asked, how is that possible? Can an act which does not suffice to make a person liable in damages, result in the same person being sent to prison for two years? My answer is, that there is nothing surprising in that; it is not the first time such a thing has happened, as is shown by the doctrine of "contributory negligence" : this serves (in certain circumstances) as a defence to a defendant in an action in tort, but is no defence to an accused in a criminal prosecution. Take another example which springs to mind in this very connection : the situation that existed here in Palestine between the publishing of the Criminal Code Ordinance, 1936, and the coming into force of the Civil Wrongs Ordinance, 1944. During that period it was certainly possible for a person to be held liable and punished for an offence under section 218, and yet not to be held liable and not to pay damages for precisely the same act, in the case of a civil Claim. The difference between the civil action and the criminal prosecution under section 218 is simple and clear : in the civil action the parties are citizen and citizen, and the matter under consideration is the payment of money for a monetary loss; in a criminal prosecution the parties are the citizen and the State, and the matter under consideration is the penalty of imprisonment (or fine) in order to prevent the loss of life; there will therefore be absolutely nothing illogical in acting with greater severity, and imposing liability for less negligence, particularly in the second case. Anyone who does not admit this distinction, and considers that the negligence necessary for a conviction under section 218 must be no less, and perhaps even greater, than the negligence required for liability in an action in tort, will be at pains to excuse and explain the palpable fact that the criminal liability under section 218 was limited only to cases of causing death, and the legislator did not extend it, either in the same section or elsewhere, to cover cases of wounding and bodily injury as well; for the general "criminal negligence" dealt with in Chapter 26 of the Criminal Code Ordinance, 1936 (sections 243-247, is not identical with the "non-culpable negligence" in section 218, but is of a higher degree, as its name implies.

 

12. The idea propounded here is fraught with very important consequences, but there is no necessity to draw all the possible conclusions from it within the framework of the present appeal. It is sufficient for as to restrict the principle herein to the specific, concrete problem before us, namely, whether the fact that the children, the victims of the accident, were trespassers (a fact which, in the circumstances of the case was, as we have seen, likely to serve us a bar to any civil claim for the payment of damages) is enough to result in the appellant's acquittal in respect of the criminal offence with which he has been charged under section 218. We must constantly bear in mind the fact that the children's visits in order to bathe in the pool were known and anticipated by the men working on the undertaking, but that they did not approve of them, so that the appellant's argument is not: "It did not occur to me that someone would dare to trespass on my property", but: "It did occur to me, but nevertheless I am exempt from liability." The question is whether to accept that argument in the criminal case before us.

 

            It seems to me that within these restricted limits, at all events, there is no room for query or doubt. Why is the trespasser not entitled to the payment of damages for the accident that occurred to him as a result of the passive negligence of the owner? Because the trespasser, as has been stated, "entered the place on his own responsibility"; because he agreed, as it were ("agreed" in the broad and not in the technical meaning of the term), to be responsible for the damage that would be caused to him as a consequence of his endangering himself. That being so, when does this concept - the concept of agreement and waiver - apply? When one is concerned with a civil, private action of an injured person seeking to replace an out-of-pocket loss, and not when the prosecution is a criminal, public one, brought by the State, with the purpose of preventing danger to life. For the life of the individual is not his private property, and he cannot give up or waive his right to it. Apart from that, the concern here is not for his own life alone.

           

13.       Finally, when the only possible defence available to the negligent defendant in an action in tort is that the injured plaintiff is a trespasser, then that defence will not avail him when he stands trial on a criminal charge under section 218.

 

            But there is one important exception to that rule, and it would be proper to state and stress it, for the avoidance of misunderstanding and error. Sometimes the fact that the deceased was a trespasser will serve the accused as a defence under section 218, not directly but indirectly, namely, when the fact is to be considered as reducing or canceling out the very negligence of the defendant. Putting it concretely: when, in the circumstances of the case, the accused is not bound to anticipate that the stranger who was killed would enter and be injured upon property that was not his. In such a case the judge will acquit the accused, not because of the deceased's act of trespass, but because of the accused's lack of negligence - a subtle distinction, but one that is fairly clear. In the present case there was no ground for such an argument, nor was it argued, as I have already indicated. The forbidden visits to the grounds of the pool were in this case offences regarded by children as of no consequence; the plant manager foresaw them, and could not fail to foresee them, so that such trespass, as a fact, was not calculated to reduce the appellant's negligence to the extent required in section 218. The sole question here, therefore, is whether it was capable of being a legal defence, in spite of the fact of negligence, and to that, too, the answer must be in the negative, on the ground explained at the end of the foregoing paragraph.

 

14. The conclusion that I have reached, therefore, is that since in the present case it was positively determined that the death of the children was caused by the negligence of the appellant within the meaning of section 218, the fact that the children were trespassers does not exempt him from criminal liability according to that section. There is equally no basis, in my opinion, for the appeal against the sentence.

 

            In my opinion, therefore, the appeal should be dismissed.

           

            CHESHIN J.  This is an appeal from a judgment of the District Court of Tel Aviv in which the appellant was convicted of causing death by want of precaution not amounting to culpable negligence, under section 218 of the Criminal Code Ordinance, 1936. and was sentenced to three months' imprisonment. The appeal is against both the conviction itself and the severity of the sentence.

           

2. The facts which brought the appellant before the court are not in dispute, and accordingly I have only to repeat with the utmost brevity the findings of the court below:-

 

A. The appellant is the manager of the "Even Ve-Sid" plant in Ramla. The grounds of the plant were unfenced, and on a moderately high rise is a square- shaped water-pool which covers an area of sixty-four square metres and serves the needs of the plant. The walls of the pool are slightly higher than the top of the rise, but the approach to the waters of the pool does not involve particular difficulty since a few stone steps lead from the ground to the edge of the walls. On the other hand, exit from the pool is difficult because the interior steps, situated under the level of the water, are slippery and serve as an insecure stepping-place. No satisfactory watch was placed over the pool, nor were any special precautions taken against strangers coming to bathe in it. Children of the neighbourhood, therefore, were in the habit of entering the grounds of the plant and of enjoying a dip in the pool when no one was looking on. The appellant, however, not only did not permit them to do so, but instructed his subordinates who worked at the place to drive away any child found wandering about on the premises of the plant close to the pool. The employees carried out these instructions, and occasionally, when they saw children bathing in the pool, would also remove the clothes left on the banks of the pool. This led several times to complaints and clashes between the employees and the children's parents. The appellant himself, too, would drive children away when they came to bathe in the pool.

 

B. On August 53, 1950, about midday, two children about nine years old named Valerie Dolman and Moshe Alters, entered the grounds of the plant, and scent down to bathe in the pool. These children had been warned once before not to come and bathe in the pool, but they paid no attention to that warning, and from the manner in which they surreptitiously crept into the grounds of the plant it was plain that they had the prohibition in mind. Close to half-past-three in the afternoon the dead bodies of these two children were taken out of the water, one holding the other's hand. The cause of death, as determined by the doctor who examined the bodies, was drowning.

 

C. Against this background the appellant was prosecuted. convicted and sentenced, as I have said.

 

3. The learned District Court judge held that the children were trespassers when they came to bathe in the pool, but considered that this fact did not exempt the appellant from criminal liability towards them. After reviewing the development of the case-law concerning negligence in the law of torts, he came to the conclusion that according to English law as it stands at present (that is to say, after the judgment in the Excelsior case (2), which will be referred to later) a person is under a civil liability even towards a trespasser, as long as he, whether by an act or by an omission, acts negligently to the extent of lack of consideration (in the words of the learned judge, "a mood of 'I don't care' "), and that that test must also be applied ashen we are enquiring whether the elements of the offence set out in section 218 are present. In the present case, therefore, the appellant, knowing of the danger awaiting children who bathe in the pool, took no sufficient steps to keep them away from the place and to prevent them going down to the pool. He thus acted negligently indicating "a mood of 'I don't care' ". The criminal liability stated in section 218, therefore, applies to him.

 

4.. Section 218 provides that : -

 

"Any person who by want of precaution or by any rash or careless act, not amounting to culpable negligence, unintentionally causes the death of another person, is guilty of a misdemeanour and is liable to imprisonment for two years or to a fine of one hundred pounds."

           

            From this section it is clear that the principal elements of the offence are twofold, namely: (a) causing death unintentionally, by (b) a want of precaution not amounting to culpable negligence.

            It does not say just "want of precaution", but "want of precaution not amounting to culpable negligence." It follows that the prosecution does not have to prove a high degree of negligence, felonious negligence, but that it is sufficient to prove want of precaution amounting to a slight degree of negligence. But the problem here is not the degree of negligence required to create the offence, but rather the question, in relation to whom is a person obliged to act with caution not amounting to negligence, and for the death of what class of persons will he be accountable under section 218 if he has not so acted cautiously towards them. Putting it another way, does section 218 set out in full all the elements of the offence stated in it, or is there one additional element, which is not expressly mentioned in it, because it is taken for granted and is in the very, nature of things.

           

5.  Section 218 has no counterpart in English criminal law, and we cannot, therefore, avail ourselves of the essential principles laid down in that law. But there are many precedents in English law concerning the civil liability involved in a person's negligence. It will not be entirely superfluous therefore to compare the substance of that same civil liability with the substance of the criminal liability stated in section 218, so as thereby to clarify and ascertain whether they differ from one another, and if they do, what is the difference between them insofar as the principle to be derived from them is concerned. .

 

6. One fundamental principle runs like a golden thread through the long line of English judgments dealing with the civil liability of a person for his neighbour's injuries. That principle is that liability depends on the duty that a person owes to his neighbour to take care, and that the duty imposed on a person in relation to a trespasser is not as heavy as that in relation to a licensee or invitee. In the case of Grand Trunk Railway Co. of Canada v. Barnett (3), before the Privy Council, which dealt with the rights of a trespasser who had been injured while travelling on a railway, Lord Robson said (at p. 369) :

 

            "The railway company was undoubtedly under a duty to the plaintiff not wilfully, to injure him; they were not entitled, unnecessarily and knowingly, to increase the normal risk by deliberately placing unexpected dangers in his way, but to say that they were liable to a trespasser for the negligence of their servants is to place them under a duty to him (the trespasser) of the some character as that which they undertake to those whom they carry for reward. The authorities do not justify the imposition of any such obligation in such circumstances."

           

            In the case of Latham v. Johnson (6), the question was this: what is the liability to the public of a landowner who allows the public, young and old, to pass over his land and to play on it. Farwell L.J., dealing with this question, cited with approval (at p. 405) the following words of Willes J., in the case of Gautret v. Egerton (18):-

           

            "To bring the case within the category of actionable negligence, some wrongful act must be shown, or a breach of some positive duty; otherwise, a man who allows strangers to roam over his property would be held to be answerable for not protecting them against any danger which they might encounter whilst using the licence."

 

            And if the extent of a person's liability towards a licensee is restricted within those bounds, how much more so towards a trespasser. It should be noted that at the end of his remarks (at p. 407), Farwell L.J. comes to the conclusion that the extent of a landowner's liability towards a child is no greater than his liability towards an adult.

           

7. In his judgment in the case of Latham v. Johnson (6), Hamilton L.J. divides the persons who come on to a man's premises into three categories, from the point of view of the latter's liability towards them. They are : invitees, licensees and trespassers. "The lowest", adds Hamilton L.J., "is the duty towards a trespasser. More care, though not much, is owed to a licensee - more again to an invitee."

 

8. The case of Hardy v. Central London Railways Co. (8) also dealt with the question of a landowner's liability towards a child trespasser who had been injured, and the following are short quotations from the remarks of the judges who sat in that case : -

 

Bankes L.J. : "If the plaintiff was a trespasser then he has no right of action, as there is no evidence of any allurement (placed there) with malicious intent to injure."

 

Warrington L.J. : "Once the conclusion is arrived at that the plaintiff was a trespasser, the judgment of the Court ought to be in the defendant's favour."

 

            Scrutton L.J. in unequivocal language makes clear what had only been hinted at in other places. The learned Lord Justice said : -

           

            "If the children were trespassers, the landowner was not entitled intentionally to injure them, or to put dangerous traps for them intending to injure them, but (the landowner) was under no liability if, in trespassing, they injured themselves on objects legitimately on his land in the course of his business. Against those he was under no obligation to guard trespassers.''

 

9. In the case of Robert Addie v. Dumbreck (9), Lord Hailsham divides the persons that come to a man's premises into three classes, just as Hamilton L.J. did in Latham v. Johnson. (6), namely, invitees, licensees and trespassers; and after dealing with the onerous nature of the duty imposed upon the landowner towards the first two classes and the extent of the care that he is bound to take towards them, he comes to the third class and says (at p. 865) : -

 

            "Towards the trespasser the occupier has no duty to take reasonable care for his protection or even to protect him from concealed danger. The trespasser comes on to the premises at his own risk. An occupier is in such a case liable only where the injury is due to some wilful act involving something more than the absence of reasonable care. There must be some act done with the deliberate intention of doing harm to the trespasser, or at least same act done with reckless disregard of the presence of the trespasser.''

 

10. Viscount Dunedin, too, spoke in the same spirit in his speech in the same case (at pp. 370, 371). In answer to the argument put forward there, that a person is obliged to fence his land, he lays down (at pp. 879, 878) that : -

 

            "There is no duty on a proprietor to fence his land against the world under sanction that, if he does not, those who come over it become licensees..... But when n proprietor protests and goes on protesting; turning away people when he meets them. . . . . and giving no countenance in anything that he does to their presence there, then I think no Court has a right to say that permission must be implied."

 

            The same learned judge as well does not see any difference between a child trespasser and an adult. The following are his words on this point (at p. 376) :-

           

            "The truth is that in cases of trespass there can be no difference in the case of children and adults, because if there is no duty to take care that cannot vary according to who is the trespasser."

 

11.       I do not think (as the learned judge in the court below thought) that the judgment in the case of Excelsior Wire Rope Co. v. Callan (2) reversed the principle expressed distinctly and in such clear language in the precedents cited. In the Excelsior case (2), it appears that two children, brother and sister, were injured on a plot of ground occupied by the defendant company, while playing with a pulley-wire which was used for moving goods wagons and was operated by a dynamo machine situated at a distance from the spot. The children of the neighbourhood were in the habit of playing on that plot of land, and the company's servants did not drive them away from the land except when they were about to work the dynamo machine and set the wire in motion. On the day of the accident also the company's servants so acted, but because of the great distance between the place where the machine stood and the place where the wire was stretched, the servants did not notice that the children had returned and come to play with the wire after they had been driven away from there. On the basis of those facts, Lord Buckmaster stated that : -

 

            "It was therefore well known to the appellants that when this machine was going to start it was extremely likely that children would be there and, with the wire in motion, would be exposed to grave danger.

           

            "In such circumstances the duty owned by the appellants, when they set the machinery in motion, was to see that no child was there, and this duty they failed to discharge."

           

            Viscount Dunedin in the same case repeats the essence of what he had previously said in Addie's case (9), and although he assumes that the children were trespassers, he comes to the conclusion that nevertheless the company must pay damages because it acted - in the language of Lord Hailsham in Addie's case (9) - "with reckless disregard of the presence of the trespasser", or, in the language of Viscount Dunedin himself in the same case - "an act so reckless as to be tantamount to malicious acting. "

           

            From these dicta it is clear that in the Excelsior case (2) the House of Lords did not intend to decide in opposition to the principles laid down by it and by other courts in previous cases as the learned judge thought in the present case, but on the contrary, the Excelsior case (2) serves as one more link in the long chain of judgments determining the liability, or absence of liability, of a landowner towards the various classes of people entering on his land, and the feature common to them all, namely, that towards trespasser there is no duty on the owner of land, apart from the duty not to do a positive act, with malicious intention or out of reckless lack of consideration of the fact of the trespasser being on the land.

           

12. The case of Mourton v. Poulter (10), was also decided according to the principles laid down in the precedents cited, and does not depart from them to the right or to the left. Scrutton L.J. says in the same case (at p. 191) : -

 

            "The liability of an owner of land to trespassers does not arise where there is on the land a continuing trap. . . . . There, as the land remains in the same state, a trespasser must take it as he finds it, and the owner is not bound to warn him. That, however, is a different case from the case in which a man does something which makes a change in the condition of the land, as where he starts a wheel, fells a tree, or sets off a blast when he knows that people are standing near. In each of these cases he owes a duty to these people even though they are trespassers to take care to give them warning."

 

13. From this group of cases, therefore, one rule, brief and clear, can be deduced: a landowner is not obliged to guard his trespasser or to warn him against any form of danger, apparent or concealed, found on his land. But the moment he proposes to do some act which involves a change in the state of the land and an increase of the danger, the duty is imposed on him, towards trespassers as well, to take reasonable care and to inform them of the change about to take place on the land. In every other case, to use the language of Lord Robson in Grand Trunk Railway Co. v. Barnett (3), "a man trespasses at his own risk".

 

14. That is the English rule in the law of torts, now as always, and it has remained so without any alteration until this day (see the two recent judgments on this point: Buckland v. Guildford Gas, Light & Coke Co. (11), and Edwards v. Railway Executive (12)).

 

15. Before passing to the question to what extent these English principles can serve as guides to the solution of the problem before as, let us linger for one moment only over the question in what way the rules of civil negligence are distinguishable from the rules of criminal negligence in English common law. The Court of Criminal Appeal considered this question thoroughly in the case of R. v. Bateman (13) in which Lord Hewart L.C.J. defines the distinction thus (at p. 10) : -

 

            "If A. has caused the death of B. by alleged negligence, then, in order to establish civil liability, the plaintiff must prove (in addition to pecuniary loss caused by the death) that A. owed a duty to B. to take care, that the duty was not discharged, and that the default caused the death of B. To convict A. of manslaughter, 'the prosecution must prove the three things above mentioned and must satisfy the jury, in addition, that A.'s negligence amounted to a crime."

 

            Further on in the same judgment he said (at p. 11) : -

 

            "In the civil action, if it is proved that A. fell short of the standard of reasonable care required by law, it matters not how far he fell short of that standard. The extent of his liability depends not on the degree of negligence, but on the amount of damage done. In a criminal Court, on the contrary, the amount and degree of negligence are the determining question. ''

           

16. From this language we gather that negligence in English law is a matter of degree : if the negligence reaches a high degree, and goes beyond the restricted framework of making good the damage and of fixing compensation between citizen and citizen, it is regarded as a criminal offence; if it does not reach this high degree, it does not posses the element of criminality, and the injured person's remedy is in damages only.

 

17. This principle was aptly expressed in the case of Andrews v. Director of Public Prosecutions (16). In that case, Lord Atkin said (at p. 47) : -

 

            "Simple lack of care such as will constitute civil liability is not enough. For purposes of the criminal law there are degrees of negligence, and a very high degree of negligence is required to be proved before the felony is established."

           

18. These words spoken by the English judges on the question of the civil and criminal responsibility involved in acts of negligence can, in my opinion, show us the way to the solution of the question that I posed at the opening of my judgment. In support of a charge of manslaughter by negligence in English law, you have to prove that the accused acted with negligence of the highest order, with culpable negligence, with criminal negligence which holds a man's life as of no account, and does not value the lives of members of the public, and is akin to felony. Such felony is included in the law of this country within the scope of the offence stated in section 212 of the Criminal Code Ordinance. But there is a negligence lighter than that : that is negligence that does not reach the status of felony, being of a lower degree. English law does not count this negligence an offence at all, and it provides that civil law alone shall cover it, through the payment of damages. The legislator of the Criminal Code Ordinance, 1986, on the other hand, considered even this lower degree of negligence a criminal offence - to use his language : "want of precaution . . . . . not amounting to culpable negligence" - and in transferring the basis of the negligence from English civil law to the confines of the criminal law in this country, he found a place for it in section 218.

 

19. Thus we gather that negligence of the higher degree necessary to create a felony in English law is the basis of the offence stated in section 212; whereas the misdemeanour stated in section 218 is created by a lesser degree of negligence, which suffices to support a civil claim for the payment of damages. But it is necessary to state that whether we are concerned with criminal negligence in English law, corresponding to the felony stated in section 212, or with criminal negligence regarded as a misdemeanour under section 218, corresponding to civil negligence in English law and under our own Civil Wrongs Ordinance, we should always bear in mind the words of Lord Hewart L.C.J. in Bateman's case (18) on the common elements necessary for both criminal liability and civil liability in English law. One of those elements is the duty towards the victim to take care. In the absence of such duty, you cannot pin any guilty act on the person who caused the damage.

 

20. That was what this court stated in Shvili v. Attorney- General (1), where it was laid down (at pp. 474, 475) :-

 

            ". . . . . For the purposes of the misdemeanour in section 218, it is essential to prove three elements:

(a) that there was a duty imposed on the defendant towards his victim to take precautionary measures;

(b) that the defendant did not take those measures;

(c) and that as a result thereof the death of the victim was caused."

           

            Later in the same passage, the court added this observation of great import:

           

            "It is permissible perhaps to comment by the way, that these factors are to a certain extent identical with the elements required to prove civil liability in an action arising from manslaughter by negligence in English law.''

           

            These last remarks were made obiter, for they were not in fact necessary for a decision in the case. That explains the reservation contained in the expression, "to a certain extent." In the present case, on the other hand, the question of the duty of a person accused of an offence under section 218 towards his victim is the very spirit and breath of the matter under consideration here, and in my opinion there is no escape from the conclusion to which I have arrived, namely, that no offence under section 218 is committed unless a person is under a duty to his neighbour to take care towards him and that person has not fulfilled that duty in the circumstances stated in the section.

           

21. I shall mention one more factor of greater practical importance. Generally speaking, there is no such thing as bare negligence, negligence which has not caused real damage, and a person is not punished for an act (and the same applies to an omission), although there be in it a measure of negligence, unless the law expressly provides that the same act shall be regarded as a criminal offence. Examples of offences of bare negligence are to be found in section 243 of the Criminal Code Ordinance. A person is punished for such negligence, even though it does not result in actual damage. But where the act of negligence by itself does not amount to an offence, and the law does not provide an accompanying punishment, unless it causes damage, such as causing a person's death, would it be lawful or equitable to punish the doer of the act even though no duty was imposed on him to act cautiously in relation to the victim? Let me illustrate my remarks with some examples from everyday life :

 

A. The owner of a citrus-grove had neglected to attend to his grove situated in the heart of the village. The fence is broken down, and the children are in the habit of getting into the grove in order to pick the leftovers of the fruit and to look for birds' nests amongst the foliage of the trees. Whenever he sees the children wandering about in the grounds of the grove, the owner drives them away from there, but does not close the gap in the fence. A child crept uninvited into the grove, and while climbing one of the trees, fell down and was killed.

 

B. Reuven has built a house but has not put a railing round his roof. The approach to the roof from the staircase does not entail particular difficulty, and from the roof it is easy to get into the living-rooms. Reuven has caught Shimon a number of times wandering about on the roof of the house, and has reproachfully driven him away; hut even afterwards has not put up a railing and has not sealed the entrance to the roof. One night Shimon went on to the roof with the intention of stealing and in the darkness fell down on the pavement of the street below, and his body was shattered.

 

C. Levi has dug a lime-pit inside his grounds next to the house he is building, and has not covered it. He knows that at night-time people go on to his land with the intention of stealing building materials, but in his opinion the damage he is likely to suffer does not cost as much as the wages of a night watchman, and accordingly does not put a watch on the place or even place a warning lamp there. One night, two thieves got into the building which was in the course of erection, one fell off a rotten plank that was used as a ladder to go from floor to floor and broke his neck and the other one drowned in the lime-pit.

 

            Does law or justice require that the owner of the grove or Reuven or Levi be convicted of causing death under section 218? Towards invitees or licensees coming to a person's house, he is in duty bound to act cautiously, but what is his duty in relation to a trespasser committing an offence? Why should we assume that the legislator intended to fasten a criminal offence on to the shoulders of a man, not for an act which he deliberately did to someone who came to his house to commit a crime, but for an act which was done in good faith, or for an omission, that is to say, for not taking care for the welfare and safety of the offender, and for not seeing to it that the latter could carry out his nefarious purpose in complete safety?

           

22. There is, in my opinion, only one conclusion to be drawn, namely, where the legislator makes the creation of the offence dependant, not on the act of negligence itself, but on its effects in relation to a person (and it makes no difference whether those effects are death, according to section 2l2, or any other injury, according to section 244), there can be no conviction unless it is proved, inter alia, that the defendant owed a duty to the victim to take care, and that he did not carry out that duty. This conclusion, for the purpose of the offence stated in section 218, is linked and bound to the rule considered above, namely, that the landowner owes no duty towards an offender trespassing on his land apart from the duty not to injure him by a wilful act. For if that be not so, what then is the difference between a trespasser and an invitee or licensee as regards the criminal liability of the landowner? And what is the difference between a person who digs a pit on public property and one who digs on private property for the purposes of that liability?

 

23. Passing from these general principles to the concrete case before as :

 

            The two children, victims in the "Even Ve-Sid" plant, were trespassers. This was held by the learned judge, and the finding is not open to question. The fact that they were attracted by a child's fancy to the pool in the grounds of the plant, that is to say, that there existed an allurement on the appellant's property - that fact may constitute a factor, among other factors, for the purpose of settling the question whether they came to the place as invitees, licensees or trespassers. But once the fact has been determined (as it was determined in the present case) that they came as trespassers, they must be regarded as trespassers, and there is no longer any importance attaching to the question whether the pool served or did not serve as an allurement to them. Moreover, these children were not just trespassers, that is to say, persons who caused damage from the civil point of view (like the trespasser in English law and in the law of torts of this country), but also committed a criminal offence under section 286 of the Criminal Code Ordinance, 1936. For they had been driven away once or twice from the appellant's property, and nevertheless came back and bothered and annoyed him. Had they been of punishable age they could have been criminally prosecuted. The appellant's one duty towards them was not to do an act wilfully to injure them while they were on his property. He was not obliged to fence in the grounds of the plant so that they would not get into them or even to raise the height of the walls of the pool so that they would not bathe in the waters of the pool. That being so, the blame cannot be put on to his shoulders for the accident that occurred to them.

           

24. Putting it generally, the elements required to prove the offence stated in section 218 are in my opinion not to be found here, and accordingly I think that the appeal should be allowed, and the appellant acquitted.

 

            ASSAF J.  I concur in the opinion of my learned colleague, Cheshin J., and in a few words would add that in my opinion the same result would be arrived at in Jewish law.:

           

            The Mishna in Baba Kama, page 33a reads as follows : -

           

            "If employees come to the private residence of their employer to demand their wages from him and their employer's ox gores them or their employer's dog bites them, with fatal results, the employer is not liable for damage. 1) Others, however, say that employees have the right to come and demand their wages from their employer, and that the employer is liable."

           

            In the Gemara the explanation is given that if the employer lives in the same city and the employees could have claimed their wages waiting outside his house, then they must be deemed to have entered his premises without permission, and in that case all are agreed that the employer is not liable. And if he is in the habit of staying always at home, then they must be deemed to have entered his house with permission to claim their wages, and in that case all are agreed that he is liable. When an employer was concerned of whom it was not known whether he was to be found in town or not, and his employees called him from the entrance of his premises, and he said "yes" to them - does his answer constitute the granting of permission to enter or not ?

           

            At all events, we can see from that discussion, that as regards trespassers entering the landlord's property without permission, there is no duty imposed on him.

           

            Basing himself on that discussion, Maimonides lays down in Chapter 10 of Hilchot Nizkei Mamon, Halachot 11-12 :

           

            "If one enters privately-owned premises without the owner's permission - even if he enters to collect wages or a debt from the owner - and the owner's ox gores him and he dies, the ox must be stoned, but the owner is exempt from paying damages, since the victim had no right to enter another's premises without the owner's consent. When he stood at the entrance and called to the owner, and the owner answered "yes", and then he entered and was gored by the owner's ox and dies, the owner is not liable, for "yes" means no more than 'stay where you are until I speak to you'."

 

            And in Tur Hoshen Mishpat, Article 389, the rule is laid down :

           

            "When employees have entered the employer's property to ask for their wages and the employer's ox has gored them there or his dog has bitten them, if the employer is not accustomed to go out to the market, since he cannot always be found in the market, the employer is liable for injury done to them, for they enter his property with permission; but if he is a person usually to be found in the market, he is not liable, for then they enter without permission.

           

            "And my late father, the Rosh, of blessed memory, wrote: In these days it is the usual custom for employees to enter the employer's house to claim their wages, and even if he be a man who usually goes to the market, he does not carry money about with him in his pocket, to pay the employees, therefore according to the custom he is liable."

 

            Thus Rambam and the Rosh and the Tur all lay down the principle that a man is not bound to act with care, except towards those who enter his premises with permission. That permission does not indeed have to be express, and it depends on custom, provided it is a "usual custom" which is generally practised. On the basis of the words of the Rosh, Maharshal wrote in "Yam shel Shlomo" on Baba Kama, Chapter 8, Article 28 :

           

            "Therefore the law varies according to the custom prevailing at the time, and the employer is liable even if he is a man one can usually find in the market. We see that even among various employers, although all of them live at the same time and in the same place, the law will be different, according to the usage of each particular one of them to be found or not to be found in the market place; a fortiori the law will be different according to the different customs prevailing at different times and at different places."

 

            And it is worthwhile mentioning another passage from Maharshal in the same work that is pertinent to our case:

           

            "I wonder whether there ever was a time in which the custom prevailed - a custom of Sodom - that a man would not enter the house of his neighbour without permission - even if he had some business to transact there. I think the true position is that he is called a trespasser only for the reason, and in case, that the landlord protested against his entering, and refused to accept responsibility for him - unless it was the house of a craftsman which is open for everybody to enter and where everybody is regarded as entering with permission."

           

            A fortiori that is the position in the present case, where the appellant and the employees in the place, who were under his control, continuously objected to the children bathing in the pool, and the matter was also Known to the children's parents living near the place; and he certainly did not undertake to exercise care towards them. But persons entering a craftman's house or a shopkeeper's store are considered as entering with permission and he is bound to exercise care towards them.

           

            This distinction between a person who enters with permission and one who enters without permission is the determining factor not only for the purpose of determining liability in damages, but also for the purpose of determining responsibility before God, i.e. the obligation to take refuge in one of the cities of refuge for having killed another person by inadvertence. The Rambam holds, in reliance on the words of the Gamara in Makot and Baba Kama, in Chapter 6 Hilchot Rotzeah :

           

            "If one enters another's premises without permission and the owner kills him inadvertently, he is exempt from going to a City of Refuge, for Scripture says : 'Or who chances upon his neighbour in a wood'. As a wood is an area which everybody is entitled to enter, including the victim, so the Scripture is to be applied to any such place accessible to the public; hence the law imposing that penalty applies only to a place of this kind. Consequently, if one enters a carpenter's shop without permission, and a block of wood strikes him in the face and kills him, the carpenter is exempt from taking refuge. But if he enters with permission, the carpenter must take refuge."

 

            And in Talmud Yerushalmi, Baba Kama, chapter 8, article 8, we read :

           

            "Rabbi Yossi ben Hanina said: Where a man is standing and felling trees in his yard and an employee enters to claim his wages, and a block of wood falls on him and injures him, he is liable, and if the employee dies, he is not bound to take refuge."

           

            This statement is queried there in view of a contrary opinion held by Rabbi Hiya, and the query is answered in this way. Rabbi Hiya speaks of the case where he did not see him enter, whereas rabbi Yossi speaks of the case where he did see him enter. From this, the Tosaphot rightly conclude (Baba Kama, page 32b, Hayav Be'arba'a), that even when he had seen him enter, he is exempt from taking refuge, because he entered without permission; only when he entered with permission must the owner take refuge.

           

            We see once more that towards a person who enters with permission (even if not invited), there is a duty to act with particular care, even when the owner is engaged in his usual occupation, which does not prima facie involve danger. That is not so, however, in the case of a trespasser.

           

            There is a case reported that was brought before Maharam of Lublin. On account of the attacks of the Tartars on the border districts of Poland, the inhabitants of the District of Wolyn were obliged "to keep their dangerous weapons always ready for use against them", and to receive training from time to time in firing a gun. A certain Jew was training in his courtyard, firing at a marked target on the wall of his house, when a man came into the courtyard from the market, although the non-Jewish squad commander in charge of the Jew who was training, stood outside to warn passers-by not to enter the premises. He did so here, and warned the man not to enter his premises, but the man entered, a bullet hit him and he was killed. The man who fired the shot did not know that anyone had entered; and it was clear that he had no intention of injuring him. The man who had fired the shot came before Maharam to seek a legal ruling; in such cases the person who had caused the harm was usually ordered to go into exile, to fast and to perform additional penances. Taking into account the circumstances of the case, Maharam found it proper not to send him into exile, and one of the reasons given was that the deceased had himself contributed to the result because he had been warned not to enter the place (Responsa Maharam of Lublin, 43). Although there is no complete parallel between that case and the present case, because there the owner of the premises performed an act endangering life, yet there is support, and partial authority for, the rule that a person who enters without permission, and particularly if he is warned not to enter, takes his life into his own hands and releases the other from his duty of care, and from the duty to see whether anyone is on the Premises.

           

            It is true that according to Jewish law every person is obliged to fence every place that constitutes a danger to a man's life, even of a person who enters without permission, and Rambam lays down this rule, based on sources in the Torah and in the commentaries of the sages, in Chapter 11 of Hilchot Rotseah Ushmirat Nefesh :

           

            "Making a parapet on one's roof is a positive commandment, for Scripture says: 'Thou shalt make a parapet for thy roof'. . . . . whether it be one's roof or anything else that is dangerous and might possibly be a stumbling block to someone and cause his death - for example, if one has a well or a pit, with or without water, in his yard - the owner is obliged to build an enclosing wall ten handbreadths high, or else to put a cover over it lest someone fall into it and be killed. Similarly regarding any obstacle which is dangerous to life, there is a positive commandment to remove it and to beware of it, and to be particularly careful in this matter, for Scripture says: 'Take heed unto thyself and take care of thy life'. If he does not remove dangerous obstacles and allows them to remain, he disregards n positive commandment and transgresses the prohibition: Bring no blood."

 

            However, while he "disregards a positive commandment and transgresses the prohibition: Bring no blood", he is not civilly liable for the injuries or the death of a person who entered his premises without permission, and he is also under no criminal liability, that being the great distinction between one who digs a pit on public property and one who digs on private property. A person is obviously forbidden to rear a dangerous dog within his house, unless it is held by chains of iron and tied to the permission and that dog bites him and even kills him, the owner of the dog is exempt from liability towards him (Shulhan Aruh, Hoshen Mishpat, 409). Save for a person who enters a craftman's house, it being customary to enter his house for his craft, for he enters with permission (see the observation of Riva, quoted in the early commentaries and in Tur Hoshen Mishpat, Article 421), "even though he enters for nothing (with no intention of buying ?) the shopkeeper is liable, for he had to guard the life" of the person who entered (Haprisha, ibid). 1

 

Appeal allowed. Conviction and sentence set aside.

Judgment given on February 12, 1953.

 

 CA 4530/91

Ports and Railways Authority

v.

Zim Integrated Shipping Services, Ltd.

 

The Supreme Court sitting as the Court of Civil Appeals

[October 10th, 2000]

Before Vice-President S. Levin, Justices T. Or, E. Mazza, M. Cheshin, I. Zamir

Appeal on the Judgment of the Haifa District Court (Justice T. Strassberg-Cohen) on September 1, 1991 in CC 1195/86.

Facts: The present case raises the question of liability for damage caused during the course of pilotage of a ship.  A ship and a dock were damaged during the course of the pilotage of a ship in the dock.  The owner of the Ship, Zim Integrated Shipping Services, Ltd. repaired the damage that was caused to the Ship, and demanded that the Ports and Railways Authority reimburse it for the cost of the repair.  The owner based the demand on the negligence of the Ports and Railways Authority and the negligence of the pilot for whose actions it was claimed the Ports and Railways Authority bore vicarious liability.  The two central questions that were addressed were: do the owners of a ship have a cause of action against the employer of a pilot who caused damage to a ship in the course of piloting in the area of a port? And, if so, how is the liability to be distributed between the owners of the ship and the pilot’s employer if the damage was caused by the joint fault of the pilot and the ship’s crew.  The District Court imposed two thirds of the liability for the damage on the pilot, and the remaining third on the captain.  The court, based on vicarious liability attributed the liability of the pilot to the Ports and Railways Authority and the liability of the captain to Zim.  The practical ramification of this distribution is that Zim’s suit against the Ports and Railways Authority was successful only in part and the Ports and Railways Authority was required to pay Zim two thirds of the cost of repair of the ship.  The Ports and Railways Authority appealed this decision.

Held:  The Court partially allowed the respondent’s appeal.  The court determined that the Ports and Railways Authority alone is liable to Zim by way of vicarious liability for the pilot’s negligence.  However, the pilot, were he to be sued to compensate Zim for the damage caused to the Ship, would only be obligated, given the contributory negligence of the captain, for half the damage.   Therefore, the Ports and Railways Authority is only obligated to compensate Zim for half of the damage.  The appellants were ordered to pay the respondent’s fees in the sum of NIS 30,000.

Legislation cited:

Torts Caused by Ships in Pilotage Ordinance 1939 ss. 1, 2.

Torts Ordinance [New Version], ss. 2, 11, 13, 13(A) (2) (B), 14, 35, 36, 84(A), 84(B).

Ports Ordinance [New Version] 5731-1971, ss. 13, 53.

Shipping (Sailors) Law 5733-1973, ss.1, 36.

Import and Export Ordinance [New Version] 5731-1971, s. 1.

Addition to the Law Extending the Emergency Regulations (Supervision of Sailing Vessels) (Consolidated Version) 5733-1973, r. 29.

Magella

Ports and Railways Authority Law, 5721-1961, s. 24(A).

 

Regulations Cited:

Haifa Port Regulations [January 7, 1933].

Ports Regulations 5731-1971, rr. 1, 37, 47, 47(a), 69, ch. 6.

Ports Regulations (Pilotage of Vessels in the Ports) 5724-1964.

Ports Regulations (Pilot Licensing) 5724-1964. 

Addendum to the Ports Regulations (Prevention of Collisions in the Sea) 5737-1977.

Prevention of Contamination of Sea Water with Oil (Implementation of the Treaty) Regulations 5747-1987, r. 1.

Shipping (Sailors) Regulations 5736-1976, rr. 22(A), 23.

 

Israeli Supreme Court cases cited:

1. CA 804/80 Sidaar Tanker Corporation v. Eilat-Ashkelon Pipeline Company Ltd., IsrSC 39(1) 393.
2. CA 542/73 Cargo Ships “El Yam” Ltd. v. Ports Authority IsrSC 30(1) 173.
3. CA 502/78 State of Israel v. Nisim IsrSC 35(4) 748.
4. CA 360/80 Michon LeMateh Ltd. v. Karnit-Fund for Compensation of Victims of Road Accidents IsrSC 35(2) 383.
5. CA 22/75 Edri v. Azizian IsrSc 30(1) 701.
6. FH 38/75 Cargo Ships “El Yam” Ltd. v. the Ports Authority IsrSC 30(2) 645.
7. CA 817/81 Ports Authority in Israel v. Zeno (unreported).
8. CA 469/64 Shiphart and Eskorant Genelsheft, A Ross and Kwo v. the Ports Authority in Israel IsrSC 19 (2) 207.
9. CA 582/71 National Insurance Institute v. the Ports Authority IsrSC 27(1)650.
10. CA 85/60 Water Works Company Ltd. v. Segel IsrSC 14 1939.
11. CA 197/58 Eylon v. Yadi IsrSC 12 1459.
12. CA 54/64 Peretz v. Keren Kayemeth LeIsrael Ltd. IsrSC 18(3) 387.
13. FH 15/88 Melekh v. Kurhauser IsrSC 44(2)89.
14. CA 1170/91 B’chor v. Yehiel IsrSC 48(3) 207.
15. CA 145/80 Waknin v. Bet Shemesh Local Council IsrSC 37 (1) 113.
16. CA 243/83 Jerusalem Municipality v. Gordon IsrSC 39(1) 113.

 

 

Israeli District Court cases cited:

1. CC (Haifa) 786/87 Zim v. Ports Authority (unreported).

                                  

American cases cited:

1. United States v. Port of Portland, 147 F. 865 (1906).
2. City of Long Beach v. American President Lines, 223 F.2d 853 (9th Cir., 1955).
3. National Development Company v. City of Long Beach, 187 F.Supp. 109 (1960); 70 Am.Jur. 2d sec. 443 (1987)). 

 

English cases cited:

1. Workington Harbour and Dock Board v. Towerfield  (Owners) [1950] 2 All. E. R. 414
2. The Esso Bernicia [1989] 1 All E.R. 37, 58-60

 

Australian cases cited:

1. Oceanic Crest Shipping Co. v. Pilbara Harbour Services Pty. Ltd. 160 C.L.R. 626

 

Israeli books cited:

[24] Barak, Vicarious Liability in Tort Law (1964)

 

Israeli articles cited:

[25] G. Tedeschi ‘Employer Immunity and the Liability of the Employee’, Mishpatim 13 (1983) 81.

[26] Englard ‘Half a Jubilee to the Civil Torts Ordinance – Problems and Trends’ Mishpatim 5 (1973-1974) 564.

[27] D. Freedman ‘The Law of Property and the Law of Fault’ The Sussman Book (1984) 241.

[28] Gilad ‘Forty Years of Israeli Law – Chapters in Tort Law’ Mishpatim 19 (1980) 647.

[29] D. Mor ‘Liability for Defective Products – Policy Considerations’ Iyunei Mishpat 6 (1978).

[30] Y. Bahat (Buchhalter) ‘Dual Vicarious Liability for the Acts of an Employee – As of When?’ Iyunei Mishpat 4 (1975) 478.

 

Foreign books cited:

1. R.P.A. Douglas, G.K. Geen, The Law of Harbours and Pilotage (London, 4th ed., 1993).
2. A.L. Parks, E.V. Cattell, The Law of Tug, Tow and Pilotage (London, 3rd  ed., 1994).
3. G. Gilmore, C.L. Black, The Law of Admiralty (New York, 2nd ed., 1975).
4. C. Hill, Maritime Law (London, 4th ed., 1995).
5. G.K. Geen, R.P.A. Douglas, The Law of Pilotage (London, 2nd ed., 1983).
6. T.J. Schoenbaum, Admiralty and Maritime Law (Minnesota, 2nd ed., 1994).
7. R.G. Marsden, On Collisions at Sea (London, 12th ed., S. Gault and others (eds.), 1998).

 

 

Foreign articles cited:

1. G.C. Stephenson “A Pilot is a Pilot: Compulsory Pilots – Vessel Owner’s Responsibilities for Intervention and Personal Injury” 70 Tulane L. Rev. (1995-1996) 633.

 

Other:

1. 70 Am. Jur. 2d (Rochester and San Francisco, 1987).

 

 

For the appellant—Ilan Orli.

For the respondent—Shlomo Freedman.

 

JUDGMENT

Justice I. Zamir

The Questions

 1.  This appeal raises two fundamental questions as to the law which applies to pilotage of ships within the area of a port:

[a]  Do the owners of a ship have a cause of action against the employer of a pilot (in fact, against the Ports and Railways Authority) who caused damage to a ship in the course of piloting within the area of a port?

[b]  Assuming the answer is in the affirmative, how is the liability to be distributed among the owners of the ship and the pilot’s employer, if the damage was caused by the joint fault of the ship’s crew and the pilot.

The questions stem primarily from the Torts Caused by Ships in Pilotage Ordinance 1939 (hereinafter: “the Pilotage Ordinance”).  And this is the language of the ordinance in its entirety, as it was originally (in its translation to Hebrew) and as it remained without amendment (even without a new version in Hebrew) from that day until today.

“An ordinance that imposes liability on a vessel’s owners and captains for damage caused as a result of pilotage in the ocean.

1. This ordinance shall be titled Torts Caused by Vessels in Pilotage Ordinance 1939.

   2.  Irrespective of what is said in any Ottoman law or any other law or ordinance, the owners or captain of any vessel in pilotage, whether the pilotage is compulsory or otherwise, will be liable for any loss or damage caused by the vessel or by an error in the navigation of the vessel.”

The Occurrence of the Damage

2.  The damage in this case occurred to the ship Yaffo (hereinafter – “the Ship”) at the Ashdod Port (hereinafter – “the Port”) on September 8, 1979.  That day the Ship entered the port carrying security equipment.  Due to the type of cargo, the Ship had to be turned (in an elliptical motion) and tied to the dock with its bow pointing to the exit.  This maneuver took place, as is customary, with the help of a pilot employed by the Ports and Railways Authority (hereinafter – “the Ports Authority” or “the Authority”).  The pilot was assisted by two of the Authority’s tugboats, which stayed close to the bow and stern of the Ship.  He boarded the Ship prior to its entry into the Port, and gave orders to the two tugboats and the Ship’s crew.  The captain, together with the pilot, was on the navigation bridge of the Ship, and supervised the execution of the orders that the pilot gave to the Ship’s crew.

As the Ship approached the dock it became necessary to brake its advance.  The braking was achieved by activating the motors against the direction of the sail.  The speed of braking was determined by the pilot, in accordance with the distance of the Ship from the dock.  Reports as to the distance were sent to the pilot from two sources: the one source, the workers of the Ports Authority, some of whom waited for the Ship on the dock and some of whom drove the tugboats; the second source, the Ship’s captain, based on reporting that he received from the first officer of the Ship who was at the bow of the Ship.

At a certain stage in the maneuver the pilot ordered a speeding up of the braking speed.  Half a minute after that the pilot changed the order, and ordered a reduction in the speed of the braking.  Suddenly the pilot received a report that the location of the Ship was at a distance of only 5 meters from the dock.  This distance did not fit the Ship’s speed of advancement.  Therefore, the pilot attempted to execute an emergency braking of the Ship.  But this braking also did not succeed in stopping the Ship on time.  The bow of the Ship collided with the dock.  As a result of this collision the Ship and the dock were damaged.

The owner of the Ship, Zim Integrated Shipping Services, Ltd. (hereinafter – “Zim”), repaired the damage that was caused to the Ship, and subsequently demanded that the Ports Authority reimburse it for the cost of the repair.  The reason for the demand was the negligence of the Authority and the negligence of the pilot for whose actions the Authority bears vicarious liability.  After the Authority denied the request, Zim filed suit in the Haifa District Court (in 1986).

The Proceedings in the District Court

3.  The Ports Authority defended itself from the suit with various claims.  For the purpose of this appeal, it will suffice to mention four of the claims.  First, the Ports Authority claimed that there was no negligence on the part of the pilot, as the insufficient braking speed was determined by the pilot on the basis of an erroneous report supplied by the first officer of the Ship as to the distance of the Ship from the dock.  Second, in addition to the negligence of the first officer, the collision was caused by the negligence of the captain, who blindly adopted the guidance of the pilot to reduce the braking speed, and did not fulfill his duty to employ independent discretion when authorizing such an instruction.  In this situation, according to the Authority’s claim, the relatively large contribution to the damage on the part of the first officer and the captain severed the causal link between the negligence of the pilot and the damage.  Third, even if there was negligence on the part of the pilot, the vicarious liability for this negligence is placed on Zim, which was assisted by the pilot for the maneuver, and in this framework supervised (via the captain) his actions.  Fourth, the law in Israel imposes strict liability on a ship’s owner for the damage caused to a ship or by a ship during the course of pilotage, whether the responsibility for the damage is placed on the ship or the ship’s crew or whether the responsibility is placed on another party.  The source for this law, the Ports Authority explained, is to be found in the Pilotage Ordinance.  See paragraph 1 supra.

4.  Evidence as to the details of the event was brought before the District Court.  After examining the evidence, the Court (Justice Strassberg-Cohen) decided to dismiss both the factual claims and the legal claims of the Ports Authority which countered its fundamental liability for the damage.

In the factual realm, the court found that the pilot played a part in causing the collision.  It established that the pilot did not have a good reason to reduce the braking speed immediately after he decided, in light of the nearing of the Ship to the dock, to increase the braking speed.  The pilot enabled the Ship to move at a faster speed than the speed that was necessitated by the distance of the Ship from the dock, and thereby contributed to its late stopping.  The claim, that sees the pilot as one who only assists or advises the Ship’s crew, was also dismissed.  The court ruled that during the course of the maneuver the pilot gave the Ship’s crew orders, and not advice, as to the speed of the Ship.

Despite these determinations, the District Court did not attribute full fault for the damage to the pilot.  It attributed a portion of the fault to the Ship’s captain.  According to the judgment, the captain’s fault stems from the fact that he refrained from intervening in an order that was given by the pilot to reduce the braking speed.  The captain received a report as to the real distance of the Ship from the dock, both from the first officer of the Ship and from the people on shore.  Therefore, he was capable, on the basis of the knowledge and qualifications that he had acquired, to deduce from these reports that the speed of advance that the pilot ordered is too high and may end in a collision.  He even was capable of translating this conclusion to a practical result, as the necessary status within the ship of orders given by the pilot does not take the reins of command over the ship out of the captain’s hands, which includes the ability to fix or cancel a mistaken command which is directed from the pilot to the ship’s crew.

After weighing the pilot’s fault against the captain’s fault, the District Court decided to impose two thirds of the liability for the damage on the pilot, and the remaining third on the captain.  The court translated this liability to the vicarious liability of the employers of the pilot and of the captain, and accordingly attributed the liability of the pilot to the Ports Authority and the liability of the captain to Zim.  The practical ramification of this distribution is that Zim’s suit against the Ports Authority was successful only in part, such that the Ports Authority was required to pay Zim only two thirds of the cost of repair of the Ship.

5.  To reach this result the District Court had to overcome another claim of the Ports Authority.  This is the claim which attributes liability for the entire damage to Zim, not based on the regular principles of Tort Law, but by power of a special law, which is expressed in the Pilotage Ordinance, according to which the owners of a ship bear liability for any damage that is caused in the course of the pilotage of the ship.  See supra paragraph 1.  The court accepted the Authority’s claim that the liability of a ship owner according to the Pilotage Ordinance is strict, but dismissed the claim that such strict liability prevents the suit of the owners against those who damaged the ship.  It explained this by the fact that strict liability according to the Pilotage Ordinance adds a cause of action, but does not detract from existing causes of action.  It was intended to make it easier for one who suffered damage from a ship during the course of pilotage, and to enable him to defray his full damages from the ship, without having to get into the distribution of liability between the ship’s crew and the pilot.  However, at the same time, all the other causes of action which emerge in the framework of the general law due to the occurrence of the damage continue to exist, whether to the benefit of the injured party against the tortfeasor, or whether to the benefit of the one tortfeasor against other tortfeasors.  On the basis of this determination the Court concluded that the Pilotage Ordinance does not detract from the right to sue which Zim has vis-à-vis the Ports Authority for the damage caused to the Ship.  This right, said the District Court, is founded in the general principles of Tort Law, as they were established in the Torts Ordinance [New Version], and the Pilotage Ordinance does not gnaw away at this right at all.

The Appeal

6.  The Ports Authority is appealing the judgment.  In the original appeal it challenged the determinations of the District Court on all fronts, both the factual front and the legal front.  Later, in the course of hearing the appeal, the dispute was narrowed.  The Ports Authority agreed to withdraw its reservations against the factual findings included in the judgment.  It also agreed with Zim, in order to simplify the proceedings, that the negligent conduct of the pilot and the captain was equal.

7.  After removing the factual obstacles from the pathway of the appeal, only the legal claims of the Ports Authority against the judgment of the District Court remained.  The claims are concentrated on these issues: first, the Pilotage Ordinance; second, the status of a pilot who is on a ship.  These issues, although they differ from one another, are tied to one another.  The Ports Authority does not accept the construction that the District Court gave to the Pilotage Ordinance, primarily because it disagrees as to the way in which the District Court conceived of the relationship between the owner of the ship, the captain and the pilot.  It does not agree with the approach of the District Court, which sees the primary purpose of the Pilotage Ordinance to alleviate matters for a third party who suffers damage from a ship in pilotage, but rather is of the view that the primary purpose of the ordinance is to encourage the captain of a ship to intervene in mistaken decisions of a pilot and thereby to lessen the dangers posed by pilotage.  The duty placed on the captain to supervise the pilot, stems, in the opinion of the Ports Authority, from the division of roles between the two, in the framework of which the pilot advises the captain, and the captain alone carries command responsibility.  According to the Authority’s claim, recognition of the existence of a cause of action in favor of a ship, outside of the Pilotage Ordinance, will undermine the duty of supervision placed on the captain.

This and more.  According to the Authority’s claim, to the extent that it is a matter of the tort of negligence (from which the District Court drew the liability of the Ports Authority vis-à-vis the Ship), it is not even necessary to go as far as the Pilotage Ordinance in order to deny the liability of the pilot toward the ship owner.  Since the tort of negligence is based on the existence of a duty of care, and in consideration of the hierarchical distribution of roles between the captain and the pilot, it is not proper to impose on the pilot a duty of care toward the ship owner.  Such a duty will not encourage the captain to prevent damage during the course of pilotage and will erode discipline on the ship, in the face of foreseeable conflicts over authority between the pilot and the captain.

The Ports Authority claims, alternatively, that even if a duty of care was imposed on the pilot toward the ship owner, such a duty would not have the power to justify the result reached by the District Court.  This is so, first, because vicarious liability for negligence of the pilot during the course of the pilotage is imposed on the ship owner and not on the employer of the pilot; second, since the increased duty of care of the captain increases his degree of liability, as compared with the degree of liability of the pilot, to the point of severing the causal connection between the negligence of the pilot and the damage; third, because the increased duty of care of the captain, must, at the very least, increase the liability of the captain, and impose the majority of the damages on him and not the pilot.

8.  Given the importance of a determination on these claims, which in part are coming up in this Court for the first time, the judges on the original panel considering the appeal decided to continue the proceedings before an expanded panel of judges.

9.  The cornerstone in the appeal of the Ports Authority is the claim as to the status of the pilot in the relationship between the ship owner, the captain and the pilot.  This claim may also have ramifications as to the construction of the Pilotage Ordinance.  Therefore, we will clarify it first.  For this purpose it is appropriate to first clarify the essence of pilotage and the law that applies to it.

Pilotage

10.  Pilotage was intended to assist in the movement of vessels in narrow, closed, or winding waterways.  Vessels may end up in such a path in the course of sailing (for example in straits, a channel or river) and is bound to find itself in such a path at the beginning of its sail or at its conclusion, when it sets sail from the port or is about to anchor in it.  In fact, pilotage in a port is more common than pilotage in other places.  In many countries, including Israel, pilotage only takes place in a port.  This being the case, we will limit ourselves to pilotage in a port.

The area of a port poses before a vessel, especially a large vessel, dangers unlike those in sailing in open waters: breaking waves, shoals, palisades, wharfs, other vessels, shallow waters, low tide, and more.  The success of the maneuver which is executed in these conditions is very much dependent on recognizing the territorial and weather conditions particular to one port or another.  As a result, the permanent crew of a vessel does not have sufficient knowledge and ability to cope with the particular dangers of a given port.  In many cases, the permanent crew is also lacking sufficient knowledge as to the work patterns and rules of behavior particular to a port.  Therefore, the permanent crew requires help from a skilled agent, who has proficiency in the facts that are particular to the port.  Ostensibly, such assistance can be given to vessels as it is given to aircraft, via the transmission of data and guidance from ashore.  However, in fact, this method is not sufficient for successful pilotage of vessels.  Unlike with aircraft, which is done entirely by the crew members, navigating a ship in a port is often done with the integration of people from within the ship and outside of it: the ship’s crew; operators of tugboats which are harnessed to the ship and which lead it within the port; people on shore who assist in tying the ship and undoing the tie; and more.  The need to coordinate between all these entities, which requires special knowledge and training, with the ground conditions particular to the port and the requirement for maximum precision of the movement in it, does not enable making do with remote control of the ship.  The safety of the pilotage requires direct and close guidance and supervision.  That is the role of the pilot.  The pilot who is generally a captain, who has undergone training in pilotage, is expert in data that is particular to the port.  He stays on the ship from the moment of entry to the area of the port until it is anchored at the dock, and later from the beginning of the sail until leaving the borders of the port.  During the course of the pilotage he checks the location and speed of the ship relative to other objects in the area of the port, stationary and mobile, and guides the ship’s crew, those in the tugboat and those on shore, accordingly, as to the alignment, timing, and speed of the ship.  As to the essence of the pilotage and the roles of the pilot see further in CA 804/80 Sidaar Tanker Corporation v. Eilat-Ashkelon Pipeline Company Ltd., [1] at 410-417.

11.  Pilotage duties and the status of the pilot are regulated in various countries by an extensive system of statutory law, including special laws.  See, for example, in England, the Pilotage Act 1987.  On the other hand, in Israel, there are no more than a few statutory provisions in these matters: the Pilotage Ordinance, which deals with liability for damage caused during pilotage, and two sections of the Ports Ordinance [New Version] 5731-1971, which establish a duty of licensing of pilots (section 13) and offenses of pilots (section 53).  The rest of the matters which relate to pilotage were left to regulations.  The first topic which was regulated in the regulations, still in the Mandate period, was the duty to be assisted by pilotage services in the area of the port.  See the Haifa Port Regulations (January 7, 1933).  The regulations have been improved from time to time and were applied to additional matters.   Today, the sixth chapter of the Ports Regulations 5731-1971 is dedicated to pilotage.  This chapter includes provisions as to competence of pilots, licensing of pilots, the duty of pilotage and clearing the way for a ship in pilotage.  These provisions, like the rest of the provisions in the Ports Regulations, apply only in the realm of the Haifa Port, the Ashdod Port, and the Eilat Port.  See the definition of “port” in regulation 1 of the Ports Regulations.  The pilotage in other ports is regulated, to date, in previous regulations: Ports Regulations (Pilotage of Vessels in the Ports) 5724-1964, and Ports Regulations (Pilot Licensing) 5724-1964.  See further, as to all the ports, regulation 29 to the Addendum to the Ports Regulations (Prevention of Collisions in the Sea) 5737-1977.

The arrangement that was established in the law and the regulations as to the duty of pilotage and the status of the pilot generated criticism.  The criticism pointed to the fact that the arrangement is outdated and does not coordinate with the developments that have occurred in the field of maritime, that it leaves important questions without an answer and that as a result of the deficiencies in the legislation there is occasionally a lack of accord between law and practice.

The criticism led to the establishment of two committees for examining the law of pilotage in Israel.  The first committee was appointed by the Minister of Transportation in the mid eighties and presented a report in 1990.  It found deficiencies in the legislation which relates to pilotage, and recommended a series of amendments in various areas, including on the question of liability for damages in the course of pilotage.  It was of the view, in contrast to the existing situation, that it would be proper to establish primary arrangements as to pilotage in primary legislation.  But the recommendations of the committee were not implemented.

In 1994 the Minister of Transportation appointed a second committee to re-examine the same matter.  This committee also found various topics requiring amendment, including liability of the pilot for damages in the course of pilotage.  However, even though the committee’s recommendations were submitted to the Minister already in 1994, to date there has still not been a decision made in the Ministry of Transportation to adopt them.

The recommendations of the two committees were formulated after thorough and comprehensive work, including comparison of the laws in other countries.  They point in a clear and convincing manner to the need to change the outdated law, which has gone almost entirely unchanged for decades, and to adapt it to the situation on the ground that has developed steadily.  Freezing the law weighs down the activity in the ports and also, as the present case proves, determinations in conflicts which stem from pilotage.

The present case, which raises the question of liability for damage caused during the course of pilotage, exemplifies the need for change in the legislation.  This question should have been answered in the framework of the Pilotage Ordinance from 1939 which deals, as its name indicates, with “torts caused by ships in pilotage”.  However, in fact, the answer provided in the Ordinance to this question is partial and opaque.  The shortcomings of the Pilotage Ordinance were described in the report of the two committees which examined the issue of pilotage.  But despite the recommendations of those committees the Ordinance has not, to date, been amended.  If the recommendations had fallen on attentive ears, it probably would have simplified and shortened the proceedings in the present case.  However, as the recommendations have not been addressed, and the Pilotage Ordinance has been left unchanged, the court has been left with the task of clarifying what the Ordinance states and filling in what the Ordinance has left lacking as to liability for damage caused during the course of pilotage.

A preliminary question to this end, which has no answer in the legislation, relates to the essence of the relationship between the pilot and the captain of a ship.

Pilot and Captain

12.  Pilotage places the captain of a ship in an unusual situation.  The captain is the commander of the ship.  His authority to give orders on the ship gives him responsibility for every act and omission on the ship.  This responsibility assumes that the captain has the knowledge and ability in all areas of operation of the ship.  Therefore, he can supervise what occurs on the ship, guide the ship’s crew and prevent errors by any person operating the ship.

This presumption is corrupted in the case of pilotage.  The need for the services of an external pilot stems from the inability of the ship’s crew, including the captain, to pilot the ship independently.  As a result, a difficulty is created in subordinating the pilot to the command of the captain: since the pilot is more expert and more qualified than the captain in pilotage, whether and when is it to be required of the pilot to comply with commands given by the captain as relates to pilotage? Whether and when is it to be expected that the captain interfere in orders given by the pilot relating to pilotage?

These questions have been dealt with more than once by courts overseas.  Generally, they have avoided the extreme position which imposes responsibility for the pilotage only on the pilot or only on the captain, and have defined the relationship between the captain and the pilot as a relationship of cooperation and reciprocity.  In this type of relationship, the authority and responsibility for pilotage is divided between the captain and the pilot.  However, the authority and responsibility for pilotage are not equally divided.  The authority of the captain, and as a consequence his responsibility, need to take into consideration the priority that the pilot has in terms of the expertise that is required for pilotage.  Therefore, the authority and responsibility of the captain must be limited to unusual circumstances.  So too, the authority and responsibility of the pilot, while justified in terms of the expertise required for pilotage, must take into account the special status of the captain as the commander of the ship.  As the commander of the ship the captain has close familiarity with the ship’s crew and the ship’s systems, and it gives him information the pilot does not have as to the technical and human abilities and limitations of the ship, which may influence executing the pilotage.  Therefore the authority and responsibility of the pilot is to be limited to circumstances which do not jeopardize the command status of the captain and do not ignore the special knowledge and experience he has regarding the ship.  The right integration of the various considerations leaves the pilot a wide range of discretion in piloting the ship, and with that preserves the captain’s ability to intervene in this discretion in unusual cases, in which the behavior or decision of the pilot appear to the captain to be dangerous or especially erroneous.  In any case, even if the captain decides not to interfere in a decision made by the pilot, he still must alertly follow the pilot’s functioning, and pass on to him any information necessary to ensure that the ship’s crew fulfills the pilot’s orders and draw the pilot’s attention to any mistake in pilotage.  This was the approach of the courts in England and the United States already in the 19th century, and this is also the accepted approach in various countries in case law and legislation, until today.

(See R.P.A. Douglas & G.K.Geen, The Law of Harbours and Pilotage (London, 4th ed., 1993) 199-220[31]; A.L. Parks & E. V. Cattell, The Law of Tug, Tow and Pilotage (London, 3rd ed., 1994)[32] 1008-1010; G. Gilmore & C.L. Black The Law of Admiralty (New York, 2nd ed., 1975) [33] 597-598; C. Hill Maritime Law (London, 4th ed., 1995) [34] 512; G.C. Stephenson ‘A Pilot is a Pilot: Compulsory Pilots - Vessel Owner’s Responsibilities for Intervention and Personal Injury’ [38] 633, 635-636.)

13.  The right reserved to the captain to intervene in decisions of the pilot must be used with great restraint and care.  There are two reasons for this.  The first reason is the proficiency of the pilot.  For this reason the captain must exercise extra caution before deciding to give preference to his opinion over the opinion of the pilot, all the more so when he seeks to take the piloting reins from the pilot and pilot the ship himself.  The second reason lies in the confusion that contradictory commands sow among the ship’s crew.  A central condition for the success of the operation of the ship, including pilotage, is the certainty of the ship’s crew as to the source authorized to give commands on the ship.  Interference by the captain in the pilot’s orders may sabotage this certainty.

With that, in extreme cases, the captain’s right to intervene not only justifies his intervention but may also demand such intervention, and imposes liability on the captain for failure to intervene.

14.  Is the formula for the relationship between a captain and a pilot similar in Israel to the accepted formula in other countries?  The District Court, after examining the law and hearing evidence answered this question in the affirmative and stated as follows:

“Pilotage is placed – both by law and in fact – in the hands of the pilot, the port person, and his status is not the status of an advisor alone.  His orders are commands which the ship’s people follow while it is in pilotage.  Despite this, this status does not neutralize the status and responsibility of the captain.  The captain does not let the reins of command of the ship out of his hands, and he has in his power and in the knowledge he is favored with, enough to enable him to intervene when necessary.”

The Ports Authority, the appellant, does not accept this determination.  In its view, the pilot does not have practical authority on the ship, and only has the status of advisor to the captain.  It claims that this is the law not only in Israel but also outside of Israel.

But the Ports Authority errs as to the law outside of Israel.  In many countries, in particular in common law countries, which serve as a central source of inspiration for pilotage law in Israel, the captain and the pilot divide between them authority and responsibility for pilotage.  The Ports Authority relies, inter alia, on a report (from 1911) of a committee that was appointed in England in order to examine the subject of pilotage.  One of the recommendations of the committee was that the law define the legal relationship between the captain and the pilot in a manner that will increase the authority of the captain.  However, in contrast to the impression that the Ports Authority is creating, this recommendation was not accepted by the English legislature and was not implemented, not in the Pilotage Law of 1913 (that was legislated pursuant to the committee’s recommendations) and not in later incarnations of this law.  (See Douglas and Green, paragraph 12 supra, [31] at pp. 162, 201-203).  Moreover, even the committee in England did not seek to reach the situation the Ports Authority is headed toward, meaning expropriating control of the pilotage of the ship from the pilot.  All that was recommended was to increase the (parallel) control of the captain over the pilotage, with the goal of encouraging him to intervene in the pilotage.  (See G.K. Geen & R.P.A. Douglas, The Law of Pilotage (London, 2nd ed., 1983) [31] at 81).

Does the law in Israel deviate from the accepted approach throughout the world?  The Ports Authority hangs on to two provisions in the Ports Regulations 5731-1971, which show, in its view, that in Israel the pilot is no more than an advisor to the captain.  The first provision is in sub-regulation 47(a).  The sub-regulation established the duty of pilotage in the port:

“A captain will not bring a vessel into the port and will not remove a vessel from the port, and will not tie mooring gear or detach it and will not execute any other maneuver with a vessel in the port, unless there is a pilot on the vessel with whom he is consulting.”

The Ports Authority emphasizes “consulting”.  In its view, that is the essence of the relationship between the captain and the pilot.

The second provision is found in regulation 69.  This regulation defines the duties of the captain during mooring at the port:

“A captain of a vessel will prevent any damage that may be caused to the dock or to any other structure in the port as a consequence of pilotage, mooring, or fettering of a vessel, or during loading or unloading.”

According to the claim of the Ports Authority imposing the duty to prevent damage during pilotage on the captain alone, and not on the pilot as well, means that the pilot is not in charge of pilotage, but only assists the captain with advice.

I believe that the Ports Authority has gone too far in the conclusions it draws from the two regulations.  These regulations were not meant to regulate the relationship between the captain and the pilot.  They deal with matters which have no connection to this relationship: the duty of a ship to be assisted by a pilot (regulation 47) and the duty of care of a captain toward the port (regulation 69).  Therefore, it is not proper to build castles on these regulations regarding the relationship between the captain and the pilot.  It is to be presumed that the formulator of the regulations, if indeed he wanted to establish anything as to this question would reveal his intention in a more detailed and explicit manner.  In any event, the conclusions of the Ports Authority are not even necessitated by the regulations themselves.  Sub-regulation 47(a) which deals with the advice that the captain receives from a pilot does not rule out the possibility that this advice has binding status on the ship.  Indeed, there is nothing preventing the advice of the pilot having the character of a command, as long as the captain has decided not to make use of his (rare) authority to give a contradictory command.  As Justice Berinson explained in CA 542/73 Cargo Ships “El Yam” Ltd. v. Ports Authority [2] at 178:

“In theory, even when a ship is in pilotage the pilot is merely the advisor of the captain and the final responsibility for piloting the ship does not fall out of the captain’s hands.  In fact, during the normal course of events, he need not do more than listen to the ‘advice’ of the pilot and fulfill it.”

Justice Netanyahu said similar things in the Eilat – Ashkelon Pipeline case [1] at 406-407:

“He [the pilot] does not replace the captain but only advises him, although taking into consideration the proficiency unique to him, this is advice that is to be taken, but the captain remains responsible, and in unique and exceptional cases is entitled to act in contradiction of the advice.”

Even regulation 69 which requires the captain to prevent damage to the port’s structures, does not state that the pilot does not bear a similar duty.  The duty of a pilot to prevent such damage does not require a legislated provision, as in Israel the pilot is a port employee, and thus is required to act with care with his employer’s property.

Moreover, as opposed to the regulations presented by the Ports Authority as a sign that the pilot does not have authority in pilotage of a ship, a series of laws and regulations can be pointed to which specifically support the status of the pilot as the holder of authority on the ship.  Thus, for example, when the legislator had to, on a number of occasions, define the term “shipmaster”; he took care to exclude the pilot from the definition (which focuses on control or command of a vessel).  See section 1of the Shipping (Sailors) Law 5733-1973; Section 1 of the Import and Export Ordinance [New Version] 5739-1979; section 1 of the Addition to the Law Extending the Emergency Regulations (Supervision of Sailing Vessels) (Consolidated Version) 5733-1973; regulation 1 of the Ports Regulations 5731-1971; regulation 1 of the Prevention of Contamination of Sea Water with Oil (Implementation of the Treaty) Regulations, 5747-1987.  If the Ports Authority is correct in the claim that in any event the pilot does not have status to issue commands on a ship, why did the legislator find it necessary to exclude the pilot from the definition of a commander of a vessel?  Additional proof against the Ports Authority is found in the Shipping (Sailors) Regulations 5736-1976.  Regulation 22(a) of these regulations requires that one who serves as a shipmaster of a vessel will have certain certification.  But regulation 23 establishes an exception to this.  It says: “regulation 22(a) will not apply to the service of a pilot certified for vessels, when the vessel is required, by any law, including foreign law, to make use of his service, and the pilot has responsibility for navigating the vessel”.  This is a clear statement, which attributes to the pilot, at least if it is compulsory for him to be on the ship, responsibility for pilotage.

15.  Since the text of the legislation does not support the approach of the Ports Authority as to the status of the pilot, the question is to be asked whether there is a substantive reason which supports this approach.  The Ports Authority presents two such reasons.  First, it claims, recognition of the authority and responsibility of the pilot weakens the willingness of the captain to take precautionary measures during the pilotage and thereby increases the danger posed by the pilotage.  I do not accept this claim.  As has already been said, the authority and responsibility of the pilot do not come at the expense of the authority and responsibility of the captain, but only complement it.  The captain, even when he brings a pilot aboard the ship, does not absolve himself of any duty of care which generally applies to the shipmaster of a ship, including the duty to monitor orders coming from the pilot and the duty to examine the degree of accord of the orders with the reality on the ground.  The captain who is assisted by a pilot also does not absolve himself of the duty to intervene in a particularly dangerous or clearly erroneous decision of the pilot.  Indeed, recognition of the authority and responsibility of the pilot may discourage the captain from intervening in borderline cases, when he is not convinced of the error of the pilot.  But, such discouragement is intended and welcome, in light of the professional advantage of the pilot over the captain in all that relates to pilotage.  See paragraph 12 supra.

The second reason is the fear of creating dual authority over the ship.  Dual authority brings on contradictory commands, and contradictory commands destroy the certainty and discipline on the ship.  However, the solution that the Ports Authority provides to prevent splitting the authority, meaning, denying the pilot’s authority, is not the only solution to be considered.  Another possible solution is limiting the (residual) authority of the captain.  Such limitation prevents contradictory commands during the routine course of pilotage, and at the same time ensures the intervention of the captain in exceptional cases, when the proximity or magnitude of the danger justifies the price entailed in contradictory commands.  This solution is preferable to the solution of the Ports Authority, as it gives weight to the proficiency of the pilot and enables gleaning from it the maximum benefit during the normal course of events.

16.  In conclusion, in Israel, as in other countries, the pilot, in particular if his services are imposed on the ship, is not just an advisor to the captain.  He carries operational authority as to pilotage.  The orders he gives obligate the ship’s crew.  Excluding exceptional cases, they also obligate the captain.  This being the case, the pilot bears responsibility for pilotage.  This responsibility obligates him to execute the pilotage with care.  The responsibility of the pilot does not stand alone.  Alongside it there is the responsibility of the captain.  This responsibility stems from the roles placed on the captain during the course of pilotage: to assist the pilot, to ensure that his orders are implemented, and to intervene in his decisions if they display special danger.  The captain also must fulfill these roles with care.

17.  The roles that are imposed during the course of pilotage, on the pilot on the one hand and the captain on the other hand, and in any case distribution of responsibility which is derived from these roles, do not necessarily match the degree of liability of the captain and the pilot for damage caused as a consequence of pilotage.  In the area of pilotage, the translation of authority and responsibility to liability in torts is not simple, as the distribution of liability in torts involves additional considerations, which are not tied to the division of roles among those causing the damage.  It would have been possible, in order to understand the significance of these considerations to hold a separate hearing on the question of the relative liability of the pilot and the captain.  However the Pilotage Ordinance, which is a central source in Israel for establishing liability as a consequence of pilotage, does not take that route.  It regulates the liability of the captain together with the liability of the ship owner, and imposes on both of them equal degrees of liability.  The reason for this is rooted, it appears, in the vicarious liability of the ship owner for the actions of the captain.  Since the liability is routed, in the end, to the ship owner, it is preferable to examine the distribution of liability from the perspective of the relationship between the pilot and the ship owner.  We will now turn to that question.

Pilot and Ship Owner

18.  The ship owner, as distinguished from the captain, is not on the ship at the time of pilotage, and does not have the necessary proficiency to execute the pilotage. Therefore, according to the general law, it is not possible to hold the ship owner personally liable for torts which occur during the course of the pilotage.  On the other hand, the ship owner is the captain’s employer, and therefore has vicarious liability for torts that the captain carries out during the course of his employment.  See section 13 of the Torts Ordinance [New Version].  See also section 36 Shipping (Sailors) Law 5733-1973.  However, does the ship owner also have vicarious liability for torts carried out by the pilot?

Vicarious liability, according to the Torts Ordinance, is conditioned on the existence of an employment relationship or agency relationship between the tortfeasor and the one on whom liability is being imposed.  See sections 13-14 of the Ordinance; CA 502/78 State of Israel v. Nisim [3] at 753-754.  Does such a relationship exist between the ship owner and the pilot?  When this question is examined against the background of the Torts Ordinance, we find the Ordinance relates differently to the two types of pilots: on the one hand, a pilot whose services the ship owner, himself or via the captain, uses on his own initiative or by his own free will (hereinafter – “voluntary pilot”); and on the other hand a pilot whose services the ship owner is required to use, and has no control over the choice of the pilot (hereinafter – “compulsory pilot”).  The difference in relating to the two types of pilots is expressed in section 13(a)(2)(b) of the ordinance which absolves “one who was forced by law to use the services of a person the choice of whom  is not given to him” from liability for the act or omission of that person.  The language of the section is clearly limited to a compulsory worker and this includes a compulsory pilot, and does not encompass a voluntary pilot.  The legislative history of the section points to the fact that its purpose was to apply the common law rule that absolves ship owners from vicarious liability for a compulsory pilot, in Israel.  (See G. Tedeschi ‘Employer Immunity and the Liability of the Employee’, [25] at 94-96). Indeed, today, such immunity, which stems from the common law, is given to ship owners in the United States.  (See Parks & Cattell [32](supra paragraph 12) at pp. 1023-1025; Gilmore & Black [33] (supra paragraph 12), at p. 520; 70 Am. Jur. 2d sec. 443 (1987) [39]).

Were section 13(a)(2)(b) of the Torts Ordinance to stand alone, it would, in accordance with a construction based on its text and purpose, be sufficient to almost entirely preclude the attribution of vicarious liability to ship owners for acts and omissions of pilots.  This is so, because pilotage in Israel is primarily carried out based on a duty imposed in regulation 47 of the Ports Regulations 5731-1971 and the identity of the pilot is determined by the Ports Authority, the pilot’s employer.  However, section 13(a)(2)(b) is not the only piece of legislation which deals with vicarious liability of a ship owner for the pilot.  Another piece of legislation on the same matter is the Pilotage Ordinance.  The Pilotage Ordinance obligates the ship owner (together with the captain) to pay for damage caused during the course of the pilotage of the Ship, even if the pilotage was compulsory.  This obligation appears in section 2 of the Ordinance, which says as follows:

“Despite all that is said in any Ottoman law, or in any other law or ordinance, the owners or the captain of any ship in pilotage, whether the pilotage is by compulsion or whether in another way, will be responsible for all loss or damage caused by the ship or by an error in driving the ship.”

This provision, according to its opening text, establishes an exception to the regular law that should have applied to the liability of the ship owner for damages caused in pilotage.  It also places vicarious liability on the ship owner for a tort caused by a compulsory pilot, although the regular tort law does not recognize such responsibility.  Moreover, in 1939, when the Pilotage Ordinance was passed, the liability it placed on the ship owner and the captain was an innovation, not only for a compulsory pilot, but also for a voluntary pilot.  The explanation for this was that, until 1947, which is the year of commencement of the Torts Ordinance, tort law (which was based on the Magella) did not recognize the principle of vicarious liability, and as a result vicarious liability could not be attributed to the ship owner even for a tort of a voluntary pilot.  Imposing such vicarious liability required a special law, and the Pilotage Ordinance in fact created this law, without distinguishing between a compulsory pilot and a voluntary pilot, “regardless of what is said in any Ottoman law or any other law or any other ordinance.”  This intention of the Pilotage Ordinance also emerges clearly from the explanatory notes to the proposed ordinance (Palestine Gazette 867 (16) p. 146) which state as follows:

“The ordinance was passed in order to also apply to cases where the guidance [meaning pilotage] is not compulsory, as in Palestine (the Land of Israel) the principle of ‘transferring responsibility to another’ according to which the ship owner or its captain is responsible for the act of the guide [pilot] is not recognized as there is not an explicit law to this end here.”

In the continuation of the explanatory notes it is stated that the ordinance is based on section 15 of the English Pilotage Law of 1913, which was in force at the time.  And so, this section as well, according to its text as well as its legislative history, imposes vicarious liability for acts and omissions of a compulsory pilot on a ship owner: prior to the legislation of the article (in the year 1913) it was not possible to attribute to the ship owner anything other than vicarious liability for torts of a voluntary pilot, and the owners were immune from liability for the torts of a compulsory pilot.  This immunity caused significant difficulties, and weighed heavily upon both the execution of the pilotage and managing legal proceedings related to pilotage.  Due to these difficulties various countries agreed in 1910, in the Brussels International Convention for the Unification of Certain Rules with Respect to Collision of Vessels (of 1910) to rescind this immunity (article 5 of the treaty).  A year later a national committee in England decided to adopt the approach of the treaty and change the pilotage law in England accordingly.  This recommendation was adopted in section 15(1) of the Pilotage Law of 1913, which came into force in 1918.  In accordance with the recommendation of the committee, the amendment of the law did not have the intention of imposing on the ship owner personal liability for the damage caused in pilotage, but only to rescind the immunity that owners had from vicarious liability for a compulsory pilot.  The text of the amendment clearly reflects this intent, as it only equalizes, as to owner liability, compulsory pilotage to non-compulsory pilotage.

“... the owner or master of a vessel navigating under circumstances in which pilotage is compulsory shall be answerable for any loss or damage caused by the vessel or by any fault of the navigation of the vessel in the same manner as he would if pilotage were not compulsory.”

Indeed this is also how the courts in England, including the House of Lords, understood section 15(1) of the law from the year 1913.  (See Workington Harbour and Dock Board v. Towerfield  (Owners) [1950] 2 All. E. R. 414 at 433-432 (hereinafter: “Towerfield ”)[21];  The Esso Bernicia [1989] [22] at 58-60; a similar approach was taken by the Supreme Court of Australia, when it interpreted the relevant local law, which is phrased (with minor changes which are not substantive) like section 15(1) of the English law.  (See Oceanic Crest Shipping Co. v. Pilbara Harbour Services Pty. Ltd. [23] at 644-645, 684-685).

Since the Mandatory Pilotage Ordinance was based, as the proposed ordinance shows us, on section 15(1) of the English law, there is an additional reason to see in this ordinance, as the courts in England saw in section 15(1), a source for vicarious liability of a ship owner for the tort of a pilot, even where he is a compulsory pilot.  This conclusion has two glaring consequences.  The first consequence is that the liability of the ship owner is conditioned upon the existence of liability on the part of the pilot.  This consequence stems from the essence of vicarious liability, which does not form until after the personal liability of the employee or the agent has formed.  [See CA 360/80 Michon LeMateh Ltd. v. Karnit-Fund for Compensation of Victims of Road Accidents [4] at 387; A. Barak, Vicarious Liability in Tort Law (1964)[24] 71.]  The second consequence is that the liability of the ship owner does not cancel and does not reduce the liability of the pilot toward the injured party, but is only added to it.  This consequence stems from section 11 of the Torts Ordinance, according to which the tortfeasor and the one bearing vicarious liability for the tortfeasor are seen as two who “are jointly liable for the same act as joint tortfeasors and can be sued for it jointly or severally.”  (See CA 22/75 Edri v. Azizian [5] at 707-709; CA 502/78 [3](supra) at p. 761).

19.  It can be said that the Pilotage Ordinance imposes on the ship owner vicarious liability for the tort of a compulsory pilot, even if the pilot is considered for this purpose a compulsory employee of the ship owner.  If this is so, the Pilotage Ordinance, being a specific law, establishes an exception to the provision in section 13(a)(2)(b) of the Torts Ordinance, which is a general law.  It is also possible to say that the vicarious liability of the ship owner for the tort of the pilot, by authority of the Pilotage Ordinance, is liability for the tort of an agent as opposed to an employee.  If so, such liability is consistent with the provision in section 14 of the Torts Ordinance, which establishes vicarious liability of a principal for the tort of an agent, and does not exclude a compulsory agent from the rule.  It appears that it is preferable, from among the two possibilities, to regard the pilot, for the purpose of the vicarious liability of the ship owner, as the agent of the ship owner and not the employee of the ship owner.

The El Yam Ruling

20.  In opposition to the conclusion which stems from that which is said above that the Pilotage Ordinance imposes on the ship owner vicarious liability for the tort of the pilot, there is the judgment of this court in CA 542/73 Cargo Ships “El Yam”  Ltd. v. The Ports Authority [6] (hereinafter – “El Yam”).  In the El Yam case the Supreme Court dismissed the approach as to the vicarious liability of the ship owner, and ruled that the Pilotage Ordinance imposes on the ship owner absolute (personal) liability for any damage caused in pilotage.  In that case the ship owner was sued to compensate the Ports Authority and the insurer of the Authority for damage that the ship caused during pilotage to a barge which belonged to the Authority.  The ship owner sent a third party notice to the pilot as the cause of the damage, and to the Ports Authority as the employer of the pilot.  The District Court, and following it the Supreme Court, presumed that the barge was not damaged due to the negligence of the ship’s owner, the captain or the pilot.  Without fault on which to base the cause of action for the suit it was necessary, ostensibly, to dismiss the suit.  However, despite this, the court allowed the suit.  It saw in the Pilotage Ordinance a source for the liability of the ship owner even without fault on the part of the ship’s crew or the pilot.  Justice Witkon, who wrote the main opinion, was aware of the fact that it is not necessary to interpret the Pilotage Ordinance in this way.  He presented and analyzed (at pp. 175-177) the history of the Ordinance as well as the different interpretation that the parallel provision in England received, according to which there is no more in the law than attribution of vicarious liability.  He even noted (at p. 177) that “I would therefore say that until now I would tend to accept the claim of the ship owner that the liability is not absolute but only vicarious”.  However, this interim conclusion did not remain the final conclusion of the judgment.  It was decided on the basis of another rationale which supports the opposing interpretation that Justice Witkon chose to prefer “not without hesitation”.  And what is the rationale?  That the phrasing of the Pilotage Ordinance (“responsible for any loss or damage”) is very similar to another statutory provision in England that regulates the liability for damages that a ship causes to the structures of the port: section 74 of the Harbours, Docks and Piers Clauses Act, 1847.  That provision was interpreted in English case law as imposing on the ship owner strict liability for the damages to the port, even without fault.  Lacking a hint in the language of the Pilotage Ordinance to the distinction between the liability established in it and the liability established in the English law of 1847, Justice Witkon preferred to compare the Ordinance to the English law, and to also see the Ordinance as imposing strict liability that does not require fault.  Justices Berinson and Kister agreed with Justice Witkon.  Justice Berinson admitted (at pp. 178-179) that the result of the judgment is “unusual” and may “occasionally bring about strange results”.  He also was willing to presume that this result does not reflect the original intent of the legislator of the Pilotage Ordinance.  Despite all this he decided to join the interpretation of Justice Witkon, for its accord with the language of the Ordinance, and taking into account the fact that it does not lead to a complete absurdity.

The ship’s owner, who was held liable for the damage caused to the barge, petitioned for a further hearing on the judgment.  President Agranat denied the petition: FH 38/75 Cargo Ships “El Yam” Ltd. v. the Ports Authority [7].  He too was of the opinion that the interpretation that was given in the judgment to the Pilotage Ordinance is anchored in the text of the ordinance and was justified given the background of the English law from the year 1847.

It is worth noting that the historical tie and the textual similarity between the Pilotage Ordinance and section 15 of the English pilotage law from the year 1913 do not enable the reconciliation of the judgment in the El Yam case and English case law, which interpreted section 15 only as a source of vicarious liability.  (See paragraph 18 supra).  Indeed, Justice Witkon related (at p. 178) to the Pilotage Ordinance and to section 15 in one breath, and his determination as to the similarity to the English law from the year 1847 is applicable to the Pilotage Ordinance and section 15 equally.  It turns out, therefore, that the judgment in the El Yam case also challenges the interpretation that was given by the House of Lords in England to section 15 of the English pilotage law.

Criticism of the Ruling

21.  The ruling that was made in the El Yam case generated criticism.  The criticism also came from this court: CA 804/80 Sidaar Tanker Corporation v. Eilat-Ashkelon Pipeline Company Ltd. [1] (hereinafter: “Eilat-Ashkelon Pipeline Company”).  A company that held the rights to run the oil port in Ashkelon sued the owners and the operator of a ship for damage caused by the ship, with a pilot on board, to the port’s structures.  This suit relied, inter alia, on the cause of action that was recognized in the El Yam case, meaning, the personal and strict liability of the ship owners in pilotage according to the Pilotage Ordinance.  Use of this cause of action raised the question of the defenses which defendants have against such a suit.  Since this question arose following the ruling in the El Yam case, which brought the law of strict liability of ship owners into the world, the Supreme Court considered it appropriate to precede and clarify this ruling.  It did so as it had doubts as to the correctness of the ruling.  In light of these doubts the panel of justices was expanded, and the parties, to which the Attorney General was joined, were invited to argue before the expanded panel on the question whether this ruling was to be deviated from.  However, by the time the moment of decision on this question arrived, the original parties approached the Court and informed it that they were willing, for the purpose of resolving the appeal, to view the ruling in the El Yam case as binding.  The Court adopted this agreement, and presumed as well, for the purpose of that case, that the ruling stands as is.  On the basis of this presumption the court ruled that the strict liability does not deny the ship owner the defenses which are available to any person causing damage according to the Torts Ordinance.  However, the court did not make do with this.  It considered it appropriate, beyond that which was necessary, to point to the difficulties that the ruling in the El Yam case raises.  Justice Netanyahu presented a number of queries as to the ruling, both in term of the substantive perspective and the historical perspective, and summarized (at p. 405) as follows:

“All these are questions of rationale, and all that I can answer is just this, that the text of the ordinance appeared to the judges who ruled in said CA 542/73 [2] so clear and unequivocal such that they preferred its literal interpretation as imposing a strict liability in light of the English case law as to section 74, although, as the hon. Justice Berinson has shown. . .  this brings about strange results. . .  this ruling prefers the literal interpretation not only over the historical interpretation but also over the interpretation according to the legislative aim.”

See also her words continued at p. 422-423.

Justice Barak also did not spare criticism from the ruling in the El Yam case.  He noted (at p. 427) that the result that emerges

“is surprising, as generally in the shipping world the principle is followed according to which the liability (at least in a collision between ships) is based on fault, and only in exceptional cases (such as damage to public ports) is this deviated from. . .  The Supreme Court was aware of the fact that its approach may ‘occasionally lead to strange results’    . . .  and contain some confusion but considered itself compelled to reach this result, as ‘when the text itself is sufficiently clear, we can do no more than apply the law as is and allow the Israeli legislator to straighten things out if and to the extent that they are not pleased with it. . .  For myself I am of the opinion that it is not to be said that the text is clear, if it does not fulfill a goal that was made clear to the interpreter.”

Later Justice Barak explained the unreasonableness in the distinction that the ruling in the El Yam case creates between a ship which does damage during the course of pilotage and a ship that does damage outside of the course of pilotage.  He added:

“Indeed, the interpretation of the Supreme Court in CA 542/73 [2] is a difficult one. . .  It is to be hoped that a way will be found to repair the situation, whether by way of changing case law or by way of legislation.  Of the two, the latter is preferable, which can take account of special situations that require special regulation.”

This call, inasmuch as it was directed at the legislature, did not bear fruit.  See supra paragraph 11.  To date, there has not been before this court a good opportunity to re-examine the continued validity of the ruling in the El Yam case.  This being so, this ruling is still valid.  From time to time it created difficulties before the courts, but in all cases the case law has managed, in one way or another, to overcome the strict liability and, in addition, impose liability on one who is not the ship owner, while leaving the ruling intact.  See CA 817/81 Ports Authority in Israel v. Zeno [7](hereinafter – “Zeno”): the strict liability according to the Ordinance does not prevent the owners of the ship from suing the Ports Authority and the Pilot for participation in the compensation that the owners were obligated to pay the third party that suffered damage from the ship; CC(Haifa) 786/87 Zim v. Ports Authority [17]: the strict liability according to the Ordinance does not rule out a suit by the ship owner against the pilot and his employer for damage that was caused to the ship in pilotage as a result of the negligence of the pilot.  In the judgment the subject of this appeal as well, the District Court was able to bypass the ruling in the El Yam case: it saw in strict liability, which is imposed according to the ruling in the framework of the Pilotage Ordinance, an additional but not exclusive cause of action that the damage gives rise to.  On the basis of this determination the District Court saw nothing to prevent the injured party (in this case the Ship) basing its suit against the tortfeasor (in this case the pilot and his employer) on a general tort in accordance with the Torts Ordinance (in this case the tort of negligence).  See paragraph 5 supra.

22.  In theory, the rationale of the District Court in this case, if it is correct, makes the need to examine the ruling in the El Yam case superfluous in this instance as well.  However, Zim, the respondent in this appeal, while it supports the rationale of the District Court, does not miss out on the opportunity that has been created to examine the ruling.  It claims that this court, as opposed to the District Court, has a better rationale for reaching the same conclusion that was reached by the District Court.  How so? While the District Court was compelled to give deference to the ruling in the El Yam case, and therefore was forced to give a limiting interpretation, in a manner that does not block causes of action outside of the Pilotage Ordinance; on the other hand, this court does not have to pave its way between the challenges created by the ruling, but can eliminate the ruling from the road.  This, according to Zim’s claim, is how the Court should rule.  If this would occur, and the liability of the ship owner and the captain according to the Pilotage Ordinance will be as it was meant to be, vicarious liability for the pilot, it will no longer be necessary to invest efforts in order to bypass strict liability.  The road to a suit by a ship owner against the pilot will then be paved and simple, like in any torts lawsuit of an employer or principal against an employee or an agent that caused damage.

A Change in the Ruling

23.  Indeed, in my view, it would be appropriate for this court to take the path suggested by Zim.  The ruling in the El Yam case was made some time ago.  Already then the court noted that the path of historical construction of the Pilotage Ordinance, which apparently reflects the legislator’s intent, leads to a different ruling, meaning, that the responsibility imposed according to this ordinance on the owners and the captain of the Ship is not strict liability but vicarious liability for the pilot.  Despite this the court preferred a literal interpretation which led it to impose strict liability.  The court was aware that strict liability is “an unusual result” and that it may “at times lead to strange results”.  And the court even presented these results explicitly.  However, as the Court said, in the words of Justice Berinson (p. 179) “if the legislator chose to use a text whose literal translation is strict liability, and it is not entirely absurd, I am of the opinion that we must give it force.”  See supra paragraph 20.

Ten years later, in the Eilat Ashkelon Pipeline Company case, the Supreme Court was willing to re-examine the validity of the ruling in El Yam.  The panel of the court was even expanded for this purpose.  In the end, the court did not examine the ruling as the parties expressed their willingness to accept the ruling as binding law.  Despite this, the court did not refrain from sharp criticism of the ruling, and even recommended amending the law.  See supra paragraph 21.  Since then more than fifteen years have passed and the law has remained as it was.

Two government committees were appointed by the Minister of Transportation to examine the law in this matter: the first submitted a report in 1990; the second – in 1994.  The two committees recommended changing the existing law regarding the damage caused during the course of pilotage.  The recommendations of both committees have remained as unturned stones until today.  See supra paragraph 11.

This time as well the court decided to expand the panel in the appeal.  Indeed, the time has come to deal head-on with the criticism that has been voiced against the ruling in the El Yam case, including by this Court, and to examine this law at its core.  Indeed, for just such a situation as this, the legislator exempted the Supreme Court from the principle of binding precedent.

24.  The essence of the criticism that has been voiced against the ruling in the El Yam case relates to the results that stem from the ruling.  Already in the El Yam case Justice Berinson said that this ruling may lead to strange results.  That would be an understatement.  The ruling leads to inappropriate results.  Here, for example, are a number of results that stem from the strict liability that was imposed in the El Yam case on the owners and the captain of the ship for any damage caused by the ship during the course of pilotage.

First, strict liability such as this creates a dissonance between the law in Israel and the law in the rest of the world.  It is an established rule in the maritime law of other countries, that liability for damage in which a ship is involved (apart from damage to port structures) is determined by the fault principle.  (See Gilmore & Black (supra paragraph 12) [33] at p. 486; T.J Schoenbaum Admiralty and Maritime Law (Minnesota, 2nd ed., 1994) [36] at 714; Marsden, On Collisions at Sea (London, 12th ed., by S. Gault, 1997) [37] at 61-62).

Second, strict liability creates a distortion within the law in Israel.  It is more severe, without good reason, specifically with the owners and the captain of a ship that is in pilotage.  As for a ship that is not in pilotage, the law for the owners and captain is equal, in principle, to the law for any tortfeasor, whose liability is limited to the damage caused as a result of personal fault (in the category of negligence or in another category).  Indeed, liability in torts generally requires fault.  (See I. Englard ‘Half a Jubilee to the Civil Torts Ordinance – Problems and Trends’ [26] at 572; D. Freedman ‘The Law of Property and the Law of Fault’ [27] at 241.)  What is the justification for deviating from this principle specifically when the ship is piloting its way in the port with the assistance of an external pilot?  In order to answer this question it is necessary to turn to the considerations which normally justify liability without fault in torts: creating an unusual risk; a special need for deterrence; possibility of distributing damage using insurance; insufficient economic capacity of the person at fault for causing the damage; and the like.  (See I. Gilad ‘Forty Years of Israeli Law – Chapters in Tort Law’ [28] at 649-650; D. Mor ‘Liability for Defective Products – Policy Considerations’ [29] at 78).  However, these considerations cannot support distinguishing between a ship in pilotage and a ship in another situation.  The pilotage does not create an unusual risk, but in fact reduces the risk that arises from the ship’s presence in the area of the port.  The pilotage also does not change the situation in terms of insurance, as the circle of those potentially suffering damage from a ship in pilotage is similar to such a circle from a ship that is not in pilotage.  Considerations of prevention and deterrence also do not justify relinquishing the fault requirement: the level of care of the pilot, which is a central tier in the safety of pilotage, will not increase as a result of imposing strict liability  on the owners and the captain.  On the other hand, the level of care of the captain during the course of pilotage which is expressed in the level of his supervision over the functioning of the pilot, will not be reduced if there is imposed on him (and on the ship owner) only vicarious liability for the pilot’s actions.  Such vicarious liability provides sufficient security as well for the payment of compensation, as it frees the person suffering the damage from the dependence on the economic capacity of the pilot.  Therefore, deterrence and collection needs also do not justify imposing strict liability on the owners and the captain.

Third, strict liability is not justified even according to the English law which the court relied on in the El Yam case.  Indeed section 74 of the English law of 1847 imposes on the owners of a ship strict liability for any damage to a port’s structures.  See supra paragraph 20.  However, this unusual liability was established by the English law in order to provide special protection to the port which serves the public.  Therefore, even if we presume that it is appropriate to adopt such liability in Israel, despite the absence of a law equivalent to the English law of 1847, the liability should have been limited to the circumstances in which it applies in England, meaning, the damage that the ship caused to a structure in the port.  But the court in Israel broadened the strict liability to any type of damage caused by a ship in pilotage in any location.

This is only a partial list of inappropriate results which stem from the ruling in El Yam.  (See further in the El Yam case, pp. 178-179, and the Eilat Ashkelon Pipeline Company case, at pp. 405, 427, 444).

25.  These results are not a decree from above.  They are not even a decree from the legislator.  The legislator of the Mandate period, as stated, did not intend to impose strict liability in the Pilotage Ordinance, but rather, as in the parallel English law of 1913, to impose vicarious liability.  See supra paragraph 18.  The court in El Yam also admitted this.  However, it preferred to rule in accordance with a literal interpretation, as though the text of the Ordinance left it no choice.

This is surprising.  As already in those days, years ago, the court was not enslaved to literal interpretation.  Generally, it avoided to the best of its ability a literal interpretation when such interpretation led it to a substantively inferior result.  In particular when the text of the law was not unambiguous.  And here, the text of the Pilotage Ordinance on the question of strict liability is not unambiguous: the Ordinance does not explicitly state that it imposes strict liability.  See the version of the Ordinance supra paragraph 1.  Even the English source, from which the court drew the strict liability, is not unambiguous.  It is true, as the court noted that the House of Lords interpreted section 74 of the English law of 1847, which uses language similar to the language of the Pilotage Ordinance, in such a way that creates strict liability.  See the Towerfield case, supra paragraph 18.  However, even the House of Lords did not adhere to this interpretation.  In the same judgment it interpreted the same language, this time in section 15 of the Pilotage Law of 1913, in a manner that creates vicarious liability and not strict liability.  (See Ibid.)  The House of Lords proved thereby that the language tolerates vicarious liability or strict liability in equal measure.  What, if so, led the court in the El Yam case to specifically impose strict liability?  It is possible that the reason is that in the El Yam case no fault was proven on the part of the pilot, the captain or the owners of the ship that caused the damage.  See paragraph 20 supra.  In such a situation, in which there was no fault on which to hang the damage, vicarious liability was not sufficient to compensate the person suffering the damage.  It is possible, therefore, that the desire to compensate the injured party is what influenced the court in the El Yam case, in a conscious or unconscious manner, to choose the path of strict liability.

However, whether or not this is the case, the ruling in the El Yam case has been perceived as a sweeping law that imposes strict liability on the ship owner and the captain in general, even when there is fault, including when there is fault on the part of the pilot.  (See Eilat Ashkelon Pipeline Company case and the Zeno case, supra paragraph 21.)  This broad conception is the source of the problem.  And what is the solution to the problem?

26.  As is known, over the years a change has occurred in the interpretive policy of the Court.  The keystone of construction, for some time now, is not literal construction but purposive construction.  Meaning, to the extent allowed by the text of the law, the Court strives to interpret the law in such a manner that will advance the purpose of the law.  The purpose of the law is to establish a good and logical rule, according to the matter under consideration, which will integrate with the broader network of legal rules and social values.  It is also proper to interpret the Pilotage Ordinance accordingly.

If so, then what is the proper interpretation of the Pilotage Ordinance?  The history of this ordinance teaches us clearly that the intent of the Ordinance, as was the intent of the parallel English law from 1913, was to impose liability for the fault of the pilot on the owners and the captain of the ship as vicarious liability.  This and no more. There is nothing in the history of the English law or the Pilotage Ordinance which justifies imposing strict liability on the owners and the captain even in the absence of fault.  See paragraph 18 supra.  Moreover, the strict liability is also not justified from other aspects.  It is not justified from the aspect of the purpose of the Ordinance, it leads to strange, if not inappropriate, results, and it is not consistent with the accepted rules as to liability for damage in similar contexts.  See paragraph 24 supra.  Therefore, there is no reason to say that the Pilotage Ordinance imposes strict liability on the owners or the captain for damage caused in the course of pilotage. It imposes vicarious liability on them and that is all.

However, it is to be asked whether this conclusion is consistent with the language of the Pilotage Ordinance which imposes dual liability: first, liability “for any loss or damage caused by the vessel” (hereinafter – “the first paragraph”); second, liability for “any loss or damage caused . . .  by an error in the navigation of the vessel” (hereinafter – the “second paragraph”)?  The second paragraph speaks explicitly of damage caused as a result of fault, while the first paragraph speaks in broad language of any damage, and not necessarily damage caused as a result of fault.  Is it to be concluded from this that there is also a difference in the law as to the liability imposed on the owners and the captain, between damage caused as a result of fault in driving the ship (in which case vicarious liability is imposed) and damage caused without such fault (in which case strict liability is imposed)?  The answer is negative, as the history of the Ordinance is one, as is the purpose and they lead to one clear conclusion: that the intent of the Ordinance is to impose only vicarious liability.  However, if this is so, what is the explanation and what is the reason for the existence of two paragraphs one next to the other?  The answer is that the dual language of the Pilotage Ordinance was copied from the dual language of the parallel law in England, meaning section 15 of the English Pilotage Law of 1913.  And here, the courts in England, which interpreted the liability according to section 15 of the Pilotage Law as vicarious liability only, applied this interpretation not only to the second paragraph in this section  (“for any loss or damage caused. . . by any fault of the navigation of the vessel”) which parallels the second paragraph in the Pilotage Ordinance, but also to the first paragraph in the section (“for any loss or damage caused by the vessel”), which parallels the first paragraph in the Pilotage Ordinance.  See the language of the section and the interpretation of the section supra paragraph 18.  Meaning, the dual language, as it was interpreted by the courts in England, is none other than a matter of format, which was intended to clarify or generalize, and not a matter of substance, and in any event it was not meant to distinguish between strict liability in one paragraph and vicarious liability in the second paragraph.  Such is the law in England.  There is no basis to presume that the legislator of the Mandate period, who copied the language from England, intended a different interpretation.  Therefore, this is also the law in Israel.  The conclusion is that absent personal liability for the damage on the part of the pilot or on the part of another person on the ship’s crew, there also is not vicarious liability of the owners or the captain of the ship and the Pilotage Ordinance does not impose any other liability on them.

It is worth noting that this conclusion is consistent with the judgment handed down by this court ten years before the ruling was made in the El Yam case: CA 469/64 Shiphart and Eskorant Genelsheft, A Ross and Kwo v. the Ports Authority in Israel [8] at 216-217.

27.  This being so, in conclusion, the Pilotage Ordinance, according to its original intention at the time and according to its correct meaning today, does not impose on the owners and on the captain of the Ship strict liability, as was ruled many years ago in the El Yam case, but only vicarious liability.  And it is one and the same whether, as in the language of the Ordinance, the damage was caused “by the vessel or by an error in the navigation of the vessel”.  This is the law from here on in.

This being so, what is the inherent benefit in the Pilotage Ordinance?  When the Pilotage Ordinance was passed, in 1939, it not only contained benefit it contained innovation.  The innovation, which was copied from the English law, was in the very idea of vicarious liability, which was absorbed as a general principle in the Land of Israel only eight years later, with the coming into force of the Torts Ordinance in 1947.  However, since then, of course, this innovation has dissipated.  What, then, is left today of the Pilotage Ordinance.

The Pilotage Ordinance still has benefit.  As according to section 13(a)(2)(b) of the Torts Ordinance, vicarious liability is not imposed on an employer “who was forced by law to use the services of a person the choice of whom  is not given to him.”  While the Pilotage Ordinance also imposes on the ship owner vicarious liability for damage caused by a compulsory pilot.

28.  Subsequent to all of this, what is the result that emerges from this ruling in the case before us?  In the case before us it is agreed that the pilot was negligent.  Zim can sue the pilot for his negligence.  For this purpose the Torts Ordinance is sufficient, and there is no need for the Pilotage Ordinance.  However, Zim, of course, does not make do with the personal liability of the pilot.  It wishes to impose liability on the Ports Authority as well, by force of the vicarious liability of the Authority for the pilot.  This being so, the question arises whether the Ports Authority can defend itself from Zim’s lawsuit, with the claim that Zim itself bears vicarious liability for the negligence of the pilot.  At this stage, therefore, the question of the vicarious liability of Zim for the negligence of the pilot according to section 2 of the Pilotage Ordinance, enters the picture.

But, prior to examining the question of the vicarious liability of Zim for the negligence of the pilot, it is appropriate to clarify the question of the relationship between the pilot and the Ports Authority.  Does this relationship produce vicarious liability of the Ports Authority for the negligence of the pilot?

The Pilot and the Ports Authority

29.  All agree that the pilot, when he was navigating the Ship, was an employee of the Ports Authority: he was bound to it by an employment contract, was integrated in its operations, received a salary and benefit from it, executed the pilotage with equipment supplied by it, and so on as to signs indicating an employment relationship.  The status of the pilot as an employee of the Ports Authority even received recognition in the Ports Regulations 1971: they define (in regulation 37) the representative of the Ports Authority as an “employer” of the pilot in the ports of which the Authority is in charge.  However, the existence of an employment relationship, in the standard sense, is not a sufficient condition, nor a necessary condition, for the existence of vicarious liability according to section 13 of the Torts Ordinance.  In order for vicarious liability to exist, it is necessary that the tortfeasor be an “employee” of the liable one, in the unique sense attributed to this term in the ordinance.  This sense requires, in accordance with the definition in section 2 of the ordinance, “complete control” of the employer as to the manner in which the employee conducts the work for him.  As to the complete control test see, for example, CA 582/71 National Insurance Institute v. the Ports Authority [9] at 654-656; CA 502/78 State of Israel v. Nisim [3] 758-759.  The Ports Authority claims that according to this test it does not bear vicarious liability for the pilot.  And why? Because the pilot is subject, when he is executing the pilotage, to the control of the captain, as to the manner of execution, and in any case the Ports Authority, as the permanent employer of the pilot, does not have “complete control” of the execution of the pilotage.  The Ports Authority supports this claim with references from other legal systems, which refused to recognize vicarious liability of the authority in charge of the port for the torts of a pilot, even where he was compulsory.

As did the Ports Authority, I too will discuss this claim in two stages.  In the first stage I will examine the result that arises from the Torts Ordinance.  After that I will examine the well-known impact of comparative law on this result.

30.  As stated, the Ports Authority claims that it does not have “complete control” of the pilot, as is required by the Torts Ordinance, in order to formulate vicarious liability of an employer for an employee.  I do not accept this claim.  Let us presume, for the purposes of this discussion, that the captain has no authority over pilotage, and that the pilot controls the pilotage exclusively.   In this situation is vicarious liability imposed on the Ports Authority for the damage that the pilot caused during pilotage?  According to the logic of the Authority, the answer must be in the negative, as the authority does not have control, not even partial control, of the decisions the pilot makes during pilotage.  Indeed, the Authority is entitled, and at times even must, draw conclusions against a pilot who shows lack of care, including ceasing to employ him or filing a complaint against him to the Pilot Licensing Committee, which was established in accordance with the sixth chapter of the Ports Regulations 5731-1971.  However, it does not have authority to intervene in the professional discretion of the pilot during pilotage.  Does this mean that it does not have “complete control” over the pilot as required for the purpose of vicarious liability?  Certainly not.  Countless judgments have imposed vicarious liability on employers for torts of professional employees such as, for example, vicarious liability of medical institutions for torts of doctors.  What, if then is the proper test for the existence of complete control for the purpose of vicarious liability of an employer for an employee?

“The complete control of the manner of execution is expressed in the fact that the employer determines the organizational and technical framework in which the employee will work . . .  the employee is not free to perform the work he is given as he wishes.  He must perform it in the organizational and technical manner which is established by the employer.  It is true, the employer is not permitted to interfere in the professional discretion of the employee, and is not permitted to instruct him as to how to use the tools and materials which are at his disposal, but he still is permitted to tell him which tools and materials to use” (A. Barak Vicarious Liability in Tort Law (1964) [24] 131.  See also at pp. 132-135, 167).

See also CA 85/60 Water Works Company Ltd. v. Segel [10] at 1949; CA 502/78 [3] (paragraph 29 supra) at pp. 758-759.

According to this test, it is clear that the Ports Authority must bear vicarious liability for the pilot.

However, in addition to the vicarious liability of the Ports Authority for the pilot, by force of the status of the Authority as an employer, there is also, by force of the Pilotage Ordinance, vicarious liability of Zim for the pilot.  Does the vicarious liability of Zim cancel out the vicarious liability of the Ports Authority?  It would have been proper to examine this question seriously if the vicarious liability of Zim had also stemmed from employer status.  In this situation it is to be asked whether it is proper to have vicarious liability of a permanent employer and of a temporary employer, simultaneously, for the tort of one employee.  (As to this question see on the one hand, CA 197/58 Eylon v. Yadi [11], at 1460-1461; CA 54/64 Peretz v. Keren Kayemeth LeIsrael Ltd. [12] at 392; on the other hand see CA 502/78 [3] (paragraph 29 supra), at p. 761.  See also Barak,  (supra), at pp. 137-138, 152; Y. Bahat (Buchhalter) ‘Dual Vicarious Liability for the Acts of an Employee – As of When?’ [30])  However, in my view, vicarious liability of the ship owner for the pilot based on the Pilotage Ordinance does not stem from an employment relationship but from an agency relationship, see supra paragraph 19.  Vicarious liability of a principal for an agent, as distinguished from vicarious liability of an employer for an employee, is not conditioned upon control by the principal of the agent, but in the substitution of the principal with the agent, and it does not impinge on the complete control that the Ports Authority, as the permanent employer of the pilot, has over the work of the pilot.  Therefore, Zim’s vicarious liability does not prevent the vicarious liability of the Authority.  Compare CA 502/78 [3] (supra paragraph 29) at p. 761.

31.  The Ports Authority also seeks to release itself of vicarious liability for the negligence of the pilot on the basis of the law in other common law countries.  Indeed, England, Canada, New-Zealand and Australia do not recognize vicarious liability of the entity in charge of the port for damage caused by the pilot.  However, the law in these countries has grown against the background of special legal arrangements, different from the arrangements practiced in Israel.  Inter alia, the body in charge of the port in these countries is not authorized in pilotage, but pilotage is the independent business of the pilot, while in Israel, as has been established in section 24(a) of the Ports and Railways Authority Act, “The Authority is permitted to work, whether on its own or via others, in any service provided at the port,” and the pilotage services are included in this.  Detailed comparison among the legal arrangements common in those countries and the legal arrangements common in Israel would require a long and detailed discussion, and I do not see fit to lengthen and complicate matters further, when they are already complex and exhausting.  Therefore, I will say only this, the different background to the laws that apply in the matter at hand, in Israel on the one hand and in other countries on the other, very much weakens the weight that is to be given to comparative law.  I will say further that there are also common law countries that recognize vicarious liability of the entity in charge of the port for the damage caused by the pilot.  (See, as to the United States, United States v. Port of Portland, 147 F. 865 (1906)[18]; City of Long Beach v. American President Lines, 223 F.2d 853 (9th Cir., 1955)[19]; National Development Company v. City of Long Beach, 187 F.Supp. 109 (1960)[20]; 70 Am.Jur. 2d sec. 443 (1987) [39]).  Therefore, comparative law cannot change the conclusion that the Ports Authority bears vicarious liability for the pilot.

However, since Zim also bears vicarious liability for the pilot, the question arises as to the distribution of liability between the pilot, the Ports Authority and Zim.  In order to answer that question we will now examine the relationship between the ship owner and the Ports Authority.

The Ship Owner and the Ports Authority

32.  The joining of the ship owner and the Ports Authority in vicarious liability for the pilot means that each one of them carries liability together with the pilot.  As a result, one who was injured by the pilot can sue the pilot, the ship owner, and the Authority, whether jointly or severally.  See Torts Ordinance section 11 and section 84(a).  (See also CA 22/75 Edri v. Azizian [5] at 709-710; FH 15/88 Melekh v. Kurhauser [13] at 103.)

The joint liability of the pilot, the ship owner and the Ports Authority frees the party suffering damage from dealing with distribution of liability between the three responsible parties.  Distribution of liability between the three only comes up in the internal relationships between them.  Generally, from a practical standpoint, there is importance to the distribution of liability between these two: the ship owner and the Ports Authority.  What, if so, is the distribution of liability between these two?  Like in any case of joint tortfeasors, here too the court must, according to section 84(b) of the Torts Ordinance, ensure distribution of liability “according to justice and integrity, taking into account the degree of responsibility of the person for the damage.”  This section, as it has been understood in the case law, requires that the distribution be done on the basis of moral blame of each of those responsible in a proportional manner.  See, for example, CA 1170/91 B’chor v. Yehiel [14] at 218.  What, then, is the relation between the moral blame of the ship owner, who bears vicarious liability for the pilot and the moral blame of the Ports Authority which also bears vicarious liability for the pilot?

It is difficult to attribute moral blame for one who bears vicarious liability and therefore it is also difficult to distribute the liability on the basis of moral blame between two who bear vicarious liability for the same person.  Thus, there is a temptation to distribute the liability between them equally.  However, the question is, will equal distribution of liability between the Ports Authority and the ship owner achieve, in the words of section 84(b) of the Torts Ordinance, justice and integrity, taking into account the degree of responsibility of each of them for the damage.

33.  There is a difference in the essence of the vicarious liability of the Ports Authority and the ship owner.  The vicarious liability of the Ports Authority is the regular employer-employee vicarious liability.  It is based on reasons which generally justify vicarious liability: distribution of the damage, ability to supervise the employee, the benefitting of the employer from the employee’s work, and more.  On the other hand, the vicarious liability of the ship owner for the pilot is special vicarious liability: it does not stem from an employment relationship; it also does not stem from a common agency relationship; it stems from a temporary relationship which has been imposed on the ship owner by law.  See supra paragraphs 18-19.  Indeed, for these reasons the common law released ship owners from vicarious liability for a compulsory pilot, and for these reasons ship owners in the United States enjoy such a release until today.  See supra paragraph 18.  Why, therefore, did the English legislator (in 1913) and following it the legislator in the Land of Israel (in 1939), cancel the release from vicarious liability which the common law gave to ship owners in compulsory pilotage?  The English legislator adopted the recommendations of the national committee (from 1911) which was established following the Brussels International Convention for the Unification of Certain Rules with Respect to Collision of Vessels (of 1910).  Therefore, we can learn about the considerations of the English legislator from the considerations of the committee and the treaty.  These considerations, as emerges from the legal literature were two:

[a]  The legislator sought to make it easier for a third party, who suffered damage from a pilot, to be compensated for the damage.  As the pilots in England operated (until 1987) as independent contractors, and the Port Authority was not responsible for their actions, it was important for the person suffering damage that liability for the damage be imposed on the ship owner.  However, a lawsuit against the ship owner was liable to encounter difficulties, based on the need to point to the fault of the ship owner or the captain.  In many cases the ship owner would defend himself against such a lawsuit by redirecting the fault onto the pilot; the pilot would redirect the fault to the captain; and the person suffering damage would have difficulty determining where the fault lay, and was even likely to leave the proceedings empty-handed.  Therefore the law came and established that the person suffering damage was entitled to sue the ship owner, by way of vicarious liability, for compensation of damage caused by the fault of the pilot.  See Douglas and Green (paragraph 12 supra) [31] at p. 199.

[b]  The legislator sought to increase the safety of pilotage.  Prior to amending the law, the captain did not have a good incentive to follow the course of the pilotage and supervise the pilot’s work, as there was no concern that the captain or the ship owner would be held liable for damage that the pilot was at fault for.  The opposite: it was specifically the involvement of the captain in pilotage that would expose him (and the ship owner) to liability for such damage.  However, it is clear that the involvement of the captain in pilotage advances the safety of the pilotage.  See G.K. Geen & R.P.A. Douglas the Law of Pilotage (London, 2nd ed., 1983) [35] at 81.

In light of the historical background of the Pilotage Ordinance, it is appropriate to say that these two considerations were the considerations that were also at the basis of the vicarious liability of the ship owner (and of the captain) for a pilot in Israel.

But these considerations which are sufficient to impose on the ship owner liability toward the person suffering damage for damage caused by the pilot, should not necessarily determine the distribution of liability for damage between the ship owner and the Ports Authority.  As, in terms of the person suffering damage, after he is ensured that he will be able to receive the compensation he is entitled to from the ship owner, it is not his concern whether and how the ship owner shares liability with the Ports Authority.  For the purpose of distribution of liability between the ship owner and the Ports Authority for damage caused by the pilot, it is to be remembered that according to the regular rules of the Torts Ordinance, the ship owner did not need to bear any liability for damage caused by compulsory pilotage; the liability imposed on the ship owner by the Pilotage Ordinance does not come to exempt the Ports Authority from liability, but to benefit the person suffering damage; as in general there is no substantive reason to exempt the Ports Authority from the vicarious liability imposed on it as with any employer, or to reduce the liability imposed on it, for damage caused by its employee, meaning, by the pilot.

Even in terms of the safety of the pilotage, there is no reason to determine, in the relationship between the ship owner and the Ports Authority that the ship owner needs to bear part of the damage caused by the pilot.  In any case, as has already been stated, the captain must supervise the pilot, and if he is negligent in his supervision he bears direct liability for the damage, and the ship owner bears vicarious liability, according to the degree of responsibility of the captain.  See supra paragraphs 14-16.

What if then is the conclusion as to the distribution of liability between the Ports Authority and the ship owner in light of section 84(b) of the Torts Ordinance, which establishes that the court will determine the distribution according to justice and integrity taking into consideration the degree of responsibility for the damage?  The conclusion is that in general the responsibility for the damage caused by the pilot will be imposed, in the relationship between the Ports Authority and the ship owner, fully on the Ports Authority.

This is generally the case, but not necessarily always so.  The question as to what is required based on justice and integrity taking into consideration the degree of responsibility for the damage is also dependent on the circumstances of the case. Therefore, the possibility is not to be ruled out that in special circumstances the court will have a special reason to deviate from the rule, and to impose on the ship owner some of the responsibility for the damage that was caused by the pilot.

34.  In the case before us Zim sued the Ports Authority for damage caused to Zim itself.  To the extent that the damage was caused by the fault of the pilot, Zim can sue the Ports Authority, which bears vicarious liability for the pilot, for compensation of Zim for this damage.  In theory, the Ports Authority can go back to Zim, which also bears vicarious liability for the pilot in accordance with the Pilotage Ordinance, and demand distribution of liability for the damage that was caused by the pilot between the Ports Authority and Zim.  However, as said, in the relationship between the Ports Authority and Zim, the liability for the damage caused by the pilot is generally imposed on the Ports Authority only.  Therefore, and absent a special reason to impose some of the liability on Zim, the Ports Authority cannot build on the claim that Zim also bears vicarious liability for the pilot, in order to reduce some of the compensation that it is liable for in light of its vicarious liability for the pilot.

Under these circumstances the Ports Authority is left with only two claims against Zim: the first, that the damage to the Ship was not caused by the negligence of the pilot; and the second, that the damage to the Ship, even if it was caused as a result of the negligence of the pilot, was also caused by the negligence of the captain, and therefore the compensation that the Ports Authority must pay Zim is to be reduced according to the proportion of the negligence of the captain.

The Negligence of the Pilot and the Captain

35.  The District Court determined that the Ship was damaged as a result of the joint negligence of the pilot and the captain.  The court attributed two-thirds of the damage to the pilot and one third to the captain.  See supra paragraph 4.  In the framework of the appeal hearing the Ports Authority and Zim agreed that the captain and the pilot were equally negligent, and that the negligent conduct of the captain and the pilot is what caused the Ship to hit the dock.  See paragraph 6 supra.  This is sufficient to determine that two of the elements of the tort of negligence in accordance with section 35 of the Torts Ordinance were fulfilled regarding the captain and the pilot: “negligent conduct” and “damage”. However, this still is not sufficient to impose personal liability in negligence on the captain and the pilot.  In order for joint negligent conduct that caused damage to lead to joint liability in negligence, it is necessary according to section 35 of the Torts Ordinance, that the two people whose conduct was negligent have a duty of care toward the person suffering the damage.  Did the negligent conduct of the captain and the pilot breach a duty of care of each of them toward Zim.

The central pillar of the duty of care, as stated in section 36 of the Torts Ordinance, is foreseeability.  The ability to foresee brings with it, generally, a duty to foresee.  In order to deviate from this rule, special considerations of legal policy must exist against imposition of the duty.  See, for example, CA 145/80 Waknin v. Bet Shemesh Local Council [15]; CA 243/83 Jerusalem Municipality v. Gordon [16].

In the case before us the Ship collided with the dock as a result of the speed of braking which was not coordinated with the distance of the Ship from the dock.  The District Court determined, as a factual matter, that the captain and pilot could have known, and perhaps even knew in fact, what the distance was, what the speed was, and what was the foreseeable result of an error in coordinating the speed with the distance.  See supra paragraph 4.  Zim never challenged this determination.  As said, the Ports Authority also now reconciles itself to this result.  See paragraph 6 supra.  Therefore, there is no reason not to affirm it.  The consequence is that the captain and the pilot were able to foresee the occurrence of the damage.  This concludes the factual portion of the negligence.

The District Court further determined that the captain and the pilot were not only able to foresee the occurrence of the damage but also should have foreseen its occurrence and taken precautionary measures to prevent it.  The Ports Authority claims that the District Court erred when it applied such a duty to the pilot.  See supra paragraph 7.  However, as we have already stated, the Authority is mistaken: the law in Israel, as in the rest of the world, is that a pilot is responsible for pilotage along with the captain.  See supra paragraphs 14-16.

The conclusion is that the joint negligent conduct of the captain and the pilot violated a joint duty of care of the captain and pilot, and this breach is what brought about the collision of the Ship with the dock.  Absent contrary considerations, it is to be said that the joint duty of care is distributed equally between the captain and the pilot.  Meaning, in light of the fact that the negligent conduct was equal and there was a single damage, the (personal) liability of the captain and the pilot for the negligence is also equal.

The Result

36.  The result is that the Ports Authority alone is liable to Zim by vicarious liability for the pilot’s negligence.  However, the pilot, were he to be sued to compensate Zim for the damage that was caused to the Ship, would be obligated, in light of the contributory negligence of the captain, for only half the damage.  The same applies to the Ports Authority.

Accordingly, the appeal is to be partially affirmed in the sense that the Ports Authority must pay Zim for only half of the damage and not two thirds as the District Court ruled. 

Orders to pay expenses and attorneys fees in the District Court will remain in force as ordered by the District Court.

Since adjustment of the amount of compensation stems from the parties’ agreement as to the degree of negligence that each party is liable for, while on the fundamental realm the claims of the Ports Authority were dismissed, the Authority must pay Zim’s court costs in this appeal in the total sum of NIS 30,000.

 

Vice-President S. Levin

I agree.

 

Justice T. Or

I agree.

 

Justice E. Mazza

I agree.

 

Justice M. Cheshin

I agree.

 

Decided as per the decision of Justice I. Zamir.

 

11 Tishrei 5761

October 10, 2000

 

 

            LCA 444/87

            LCA 452/87

CA 80/88

           

Abu Sirchan Araf Makabel Munhar Alsoucha and Another

v.

Estate of the late David Dehan and Others

    LCA 444/87

Estate of the late David Dehan and Others

v.

Abu Sirchan Araf Makabel Munhar Alsoucha and Another

    LA 452/87

Hitam Zeidan Jizmawi

v.

Aiyash Jamal and Another

    CA 80/88

           

The Supreme Court Sitting as a Court of Civil Appeals

 

Before Shamgar, p., Barak, J., and D. Levin, J.

 

 

Editor's Synopsis

            These combined appeals raise a common issue, whether a person who suffered mental injury in consequence of the death or severe bodily injury negligently caused to a close relative can recover damages in tort under the Civil Wrongs Ordinance [New Version], which establishes a cause of action based on common law negligence, and under the Road Accident Compensation Law, 1975, which imposes absolute liability for injuries suffered "in a road accident". After surveying the English, Australian and American judgments relating to compensation for mental injuries suffered because of severe injury to a loved one, the Supreme Court ruled that such damages were recoverable under both the Civil Wrongs Ordinance and the Compensation Law, pursuant to certain guidelines laid down by the Court.

                     

1.  Generally, the conceptual duty of care not to cause mental injury to third persons in consequence of bodily injury caused to the primary victim should be limited to those third persons who are related to the primary victim in the first degree, such as parents and children or spouses. Exceptional circumstances which might also be worthy of legal protection may be left to later cases.

 

2.     It is not necessary that the secondary victim suffer the mental injury by virtue of his having directly perceived the original injury or its immediate aftermath. There should be no such special requirement, whether as part of or superimposed upon the general foreseeability test.

 

3.     Similarly, the significance of the injured person's proximity or remoteness from the scene of the original accident should also be examined in the context of its influence on the foreseeability of the harm.

 

4.     Nor should recovery be limited to such mental injury as is induced by shock. Injury that is the result of continuous exposure to the primary harm, for example by lengthy treatment and care of the primary victim, may also be compensable.

 

5.     Only severe and substantial mental reactions are compensable. Lesser mental effects such as distress, pain and anger, that are daily occurrences and, in the nature of things, temporary and ephemeral, are not recoverable.

 

6.     The same standards for recovery should apply under the Civil Wrongs Ordinance and under the Compensation Law.

 

Israel Supreme Court Cases Cited:

[1] CA 294/54 Zvii v. Shamir, 12 P.D. 421.

[2] CA 4/57 Nadir v. Kahanowitz, 11 P.D. 1464.

[3] CA 813/81 Zion Insurance Co. v. Estate of the late David Buskila, 38(4) P.D. 785.

[4] Cr.A. 6/55 Dahoud v. The Attorney General, 9 P.D. 1009.

[5] Cr.A.402/75 Algavish v. The State of lsrael, 30(2) P.D. 561.

[6] CA 145/80 Waknin v. The Bet Shemesh Local Council, 37(1) P.D. 113.

[7] Cr.A. 186/80 Yaari v. The State of lsrael, 35(1) P.D. 769.

[8] CA 243/83 Jerusalem Municipality v. Gordon, 39(1) P.D. 113.

[9] CA 358/83 Shulman v. Zion Insurance Co. Ltd., 42(2) P.D. 844.

 

District Court Cases Cited:

[10] C.C. (Jerusalem) 583/66 Kardi v. Feltzgein, 61 P.M. 161.

[11] Motion (Beersheva) 109/78 Peretz v. Carmi, 1978(1) P.M. 506.

[12] C.C. (Haifa) 910/69 Estate of the late Yehudit Haleb v. Carmel Beach Ltd., 72 P.M. 161.

[13] C.C. (Tel Aviv) 582/72 Shakui v. Salmon, 1979(2) P.M. 77.

[14] C.C. (Jerusalem) 907-09/81 Estate of the late Salhav v. Shalhav, 1984(2) P.M. 441.

 

Australian Cases Cited:

[15]Jaensch v. Coffey (1983-84) 155 C.L.R. 549.

[16] Pratt Goldsmith v. Pratt [1975] V.R. 378.

[17]Mount lsa Mines Ltd. v. Pusey [1970] C.L.R. 383.

 

American Cases Cited:

[18] Dillon v. Legg 441 P.2d 912 (1968).

[19] Champion v. Gray 478 so.2d 17 (1985).

[20]Brown v. Cadillac Motor Car Div. 468 so.2d 17 (1985).

[21] Paugh v. Hanks 451 N.E.2d 759 (1983).

 

English Cases Cited:

[22] Victorian Railway Commissioners v. Coultas (1888) 13 App. Cas.

222 (P.C.).

[23] Dulieu v. White & Sons [1901] 2 K.B. 669.

[24] Hambrook v. Stokes Bros. [1925] 1 K.B. 141 (C.A).

[25] Bourhill v. Young [1942] 2 All E.R. 396 (H.L.).

[26] Boardman v. Sanderson [1964] 1 W.L.R. 1317 (CA).

[27] King v. Phillips [1953] 1 Q.B. 429 (CA).

[28] McCloughlin v. O'Brian [1982] 2 All E.R. 298 (H.L.).

[29] Anns v. Merton London Borough [1978] A.C. 728.

[30] Attia v. British Gas Plc. [1987] All E.R. 455 (CA).

[31] Chadwick v. British Transport Commission [1967] 2 All E.R. 945 (Q.B.).

[32]Dorset Yacht Co. v. Home Office [1970] A.C. 1004.

 

 

 

JUDGMENT

SHAMGAR, P.:

 

            1. Before us are two reciprocal requests for leave to appeal against a judgment of the Jerusalem District Court in an action for damages under the Road Accident Victims Compensation Law, 1975 (hereinafter the Compensation Law). We decided to consider them as though such leave had been granted and the appeals had been brought pursuant to such leave.

 

            An appeal against a judgment of the Nazareth District Court will be considered at the same time.

           

            The two judgments appealed against raise the same question, namely, the liability - within the meaning of the Civil Wrongs Ordinance [New Version] (hereinafter - the Civil Wrongs Ordinance) and the Compensation Law - for mental injury caused to relatives of a person injured in a road accident. That is why we decided to consider the appeals together.

           

            2. LCA 444/87 and 452/87

           

            The relevant facts were surveyed in the partial judgment of the Jerusalem Magistrate Court, which considered the action brought by the applicants in LCA 452/87 (who are the respondents in LCA 444/87).

           

            These are the principal facts:

           

            On 8.1.82, the boy David Dehan was injured by a car driven by the first respondent in LCA 452/87 (the first applicant in LCA 444/87). David was born on 11.9.76 and on the day of the accident he was not yet six years old. He was taken to the Hadassah Hospital, Ein Karem, and died 24 days later. David's parents were not with him at the time of the accident and when they heard about it they went to the hospital where, according to the trial court, "they saw him in serious condition and in terrible agony and sat with him all the time until he died."

           

            After David died, his parents and his estate brought an action under the Compensation Law in the Jerusalem Magistrate Court in which they sought, inter alia, compensation for mental injuries caused to the parents, who are the second and third respondents in LCA 444/87. The injuries were defined as follows:

           

"9. As a result of the accident, the serious injury to the deceased, the stay at his side in the hospital and the sight of his dying and final decease, the plaintiffs' mental and physical health declined.

 

10. The plaintiffs no longer function as in the past. They suffer from stress, depression, fears and nervousness. They are frequently absent from work and require physical and psychiatric help."

 

            3.         The argument of the applicants in LCA 444/87, as set forth in their statement of defence submitted to the Magistrate Court, was that the compensation claimed by the parents was not actionable under the Compensation Law.

           

            In its partial judgment the Magistrate Court held as follows: first, the parents have a cause of action for compensation in tort against the driver for the mental injury "caused in consequence of the trauma which the parents suffered as a result of the injury caused to their son, which includes both pain and suffering". Second, the parents also have a cause of action under the Compensation Law as "victims" who suffered "bodily damage" in a "road accident".

           

            4. The driver and his insurers (the applicants in LCA 444/87 and the respondents in LCA 452/87) appealed against the above two findings in the partial judgment.

           

            The District Court concluded that the injury does not come within the scope of the Compensation Law, because the condition that the bodily damage be caused by a "road accident" was not satisfied. The District Court was of the opinion that:

           

"The respondents' son was injured in the road accident, not the respondents themselves. The respondents were injured at a later time and by something else - by their son's suffering. If there is any connection between their injury and the road accident, it is remote. Moreover, as defined in the Law, an 'injured person' is a person who is injured in a road accident. The preposition 'in' points to a direct injury in the accident, at the time of the accident, at its place and by its force."

 

            As to the cause of action based on the Civil Wrongs Ordinance, the District Court found that the parents had an action for negligence against the defaulting driver. The District Court found that he had a duty of care toward a relative of the direct victim, since he should have foreseen such relative's mental injury, whether the relative was present at the scene of the accident and witnessed it or whether the consequences of the accident were brought to his knowledge at a later stage.

           

            According to the District Court:

           

"It is not the proximity in time and space to the accident that determines but the emotional suffering, and what is the difference between suffering which began at the time of the accident and suffering caused when the relative first sees the victim? ... Once incidental mental injury is brought within the bounds of foreseeability, we say thereby that the negligent person owes a duty of care not only to the immediate victim but also to his relatives who are injured by his suffering. And if that is so, then what is the difference between relatives who were present at the accident and those who were not?"

 

            The driver and his insurers (in LCA 444/87) appealed against the finding of liability in tort; and the parents and the deceased's estate appealed (in LCA 452/87) against that part of the judgment in which the court found that there was no cause of action under the Compensation Law.

           

            5. CA 80/88

           

            The facts in this case were summarized by the parties who formulated an agreed version of the preliminary question now before the court:

           

" 1. The first defendant's lorry hit the plaintiff’s mother while she was returning from the grocery store in her village and injured her critically.

 

2. The mother was hospitalized in the Hillel Yaffe Hospital in Hadera on 18.6.82 and died there of her injuries on 26.6.82.

 

3. The event described above is within the scope of the Compensation Law.

 

4. The plaintiff was not present at the scene of the accident, but was informed about her mother's injury a short time later at her home nearby.

 

5. The plaintiff visited her mother in the hospital during her stay there and afterwards saw her corpse when her mother's body was brought home for burial.

 

6. On the assumption that, as a result of hearing of her mother's injury and seeing her corpse, the plaintiff suffered mental illness - is this illness bodily damage that is compensable under the Compensation Law".

 

            In the District Court, the plaintiff claimed compensation for the mental illness she suffered, and for all her injuries resulting therefrom.

           

            6. The Nazareth District Court's conclusion was that the daughter had no cause of action for compensation in tort in the circumstances of the case before us. The reason for this was the absence of any legal causal connection between her illness and the accident. In the words of the District Court:

           

"The injury which has a legal causal connection with the accident (as opposed to a factual causal connection), and the injury which is directly foreseeable from the accident, is the injury caused in consequence of the accident and not that which is caused because of or in consequence of the someone else's injury in the accident... Once we allow an action for injury which is not directly connected with the accident itself, and the connection with it is only secondary - we are no longer concerned with injury whose cause is legally connected with the accident".

 

            With regard to the cause of action under the Compensation Law, the Nazareth Court was inclined to accept the conclusion of the Jerusalem District Court in the above additional judgment that is before us on appeal - that the plaintiff does not come within the definition of the term "injured person" in a "road accident". The Nazareth Court added:

         

  "The Law is intended to provide relief to victims of road accidents by imposing an absolute duty of compensation. Prima facie, it would appear that the legislature's intention was to compensate the injuries of those actually involved in the accident".

 

            The deceased's daughter - the plaintiff - appeals against the District Court's judgment in both of its aspects (CA 80/88).

           

            7. The Legal Question

           

            Within the framework of cases before us we are asked to reply to each of the following questions:

           

            First, is there liability under the Civil Wrongs Ordinance for mental injury caused to a family member, whose dear one was injured, killed or threatened with such harm, by the defendant's negligent act or omission, when such mental injury is caused by the said harm or as a result thereof.

           

            Second, is a person who suffers such mental injury an "injured person" in a "road accident" within the meaning of the Compensation Law.

           

            The "family members" or "relatives" of whom we speak here are the parents in one case and the daughter in the other; the mental injury we consider is "stress, depression, fears and nervousness" in the one case and "mental illness" in the other. In both matters, we deal with mental injury that caused the plaintiffs both pecuniary injury and non-pecuniary injury.

           

            8. The Israeli Precedents

           

            The courts in Israel have considered the question before us on a few occasions, while examining the English law on the subject and its adoption in our system.

           

            (A) In CA 294/54 [1] the parents of a minor who drowned in a cesspool sued for damages in tort. Among other claims, they sought compensation for the mental shock suffered by the mother when she heard of her son's death and for her mental depression ever since the event. This condition, she claimed, prevented her from pursuing her profession (dressmaking).

           

            The Supreme Court, at page 443, in a judgment delivered by Justice Agranat (as his title was then), refused to compensate this injury, for two reasons: "First, because the English courts have not gone so far, in a single one of their judgments, as to hold that hearing, from a third person, after the fact, of a tragic accident that occurred to a blood relative, and that was caused by the defendant's negligence, could serve as grounds for compensation." The second reason concerns the kind of damage caused. The court reaffirmed what it had held in CA 4/57 [2], at page 1467, that "emotional disturbances, such as emotional trauma and cognitive shock caused to a person as a result of the negligence of another, do not entitle him to damages unless they result in a visible injury or illness". In the circumstances of the case, it was held, as a finding of fact, that the mental suffering caused to the mother as a result of the tragedy that occurred to her son did not express itself in any illness at all.

           

            It may be said, therefore, that the court's opinion in this matter was that, on the one hand, no duty of care existed toward the mother - and it could therefore not have been breached - because of her distance from the scene of the accident; and, on the other hand, that the mother's injury is not compensable as it is solely emotional, unaccompanied by any visible external manifestation.

           

            (B) C.C. (Jerusalem) 583/66 [10] considered the claim of a husband whose wife and youngest son were killed in an accident. The plaintiff claimed, inter alia, that because of his broken heart and the deep sadness which he suffered since the tragedy he forgot to feed his horse, which died as a result. He sued for compensation in the amount of the horse. The court, in a judgment delivered by Judge M. Ben Porat (as her title was then), considered the question whether the wrongdoer owed a duty of care to the husband and held that the husband did not belong to the circle of persons toward whom the wrongdoer owes a duty not to be negligent:

           

            "When a mother sees with her own eyes how her son is run down, she being close to the scene of the accident, she has a cause of action for compensation  against the wrongdoer, if she suffers emotional shock as a result thereof. In such circumstances she is within the scope of persons to whom the wrongdoer owes a duty of care Hambrook v.  Stock Bros. (1925) 1 K.B. 141, 152, because a reasonable driver should foresee the possibility that a mother would be injured by such a sight. However, the situation is different when the parent, or the husband, of the victim was not present at the scene and did not experience the event directly, but heard about it from another person. In such a case he does not come within the range of foreseeability on the part of a reasonable driver, and the latter, therefore, does not owe him a duty of care”.

 

          A similar conclusion was reached in Motion (Beersheva) 109/78 [11]. In that case a son, who suffered a nervous breakdown as a result of his mother's death in a road accident, claimed varying damages (including pain and suffering, costs of treatment and loss of future earnings). The plaintiff was not at the scene of the accident and heard about it afterward from a third party. The court, at page 510, was of the opinion that in establishing a duty of care -

         

"the plaintiff’s geographic relation, time relation or visual relation to the event are relevant considerations in deciding whether the breakdown was a reasonably foreseeable result of the defendant's conduct...

 

In this continuum, it is not necessary that the plaintiff be present at the place where the accident actually occurred; but it is still necessary that the plaintiff should have been an eye-witness to the tragedy or to its immediate aftermath."

 

          The son's action was dismissed for failure to establish any one of the above relations.

         

          (C) A certain relaxation of the limitation that the relative be physically present at the scene of the event for the wrongdoer to be liable for damages toward him was established in the case that was considered in C.C. (Haifa) 910/69 [12]. In that case the plaintiff and her two children were at the seashore. Her children went swimming while the plaintiff remained on the shore. Both children drowned and the plaintiff saw them being brought out of the water and the attempts to revive them. In her presence they were taken to a hospital, where she was informed of their death. The plaintiff claimed that she became mentally ill as a result of the emotional shock she suffered and supported her claim with a medical certificate.

 

            In this case, too, the question confronting the court was whether, in the circumstances, the defendants had breached "a duty which they owed the mother under the Civil Wrongs Ordinance to ensure that she be protected against emotional shock". The court thought, in an opinion written by Judge Schall, that the test to be applied is the foreseeability test, which is accepted as the test for fixing the limits of the duty of care in negligence. The court's conclusion was that the mother had a cause of action in negligence for the emotional shock caused her. It said, at page 166:

           

"The precedents which I have reviewed show that today emotional shock caused by fear or terror can furnish a cause of action against the person who negligently caused a situation which caused the shock, not only when there is a threat of bodily injury to the person himself but also when his children are threatened... The cause of action will be complete even if the mother was not present at the scene of the accident and did not see the tragedy with her own eyes. It is sufficient that it was foreseeable that she would be in the vicinity of the accident, and learn there of the tragedy that befell her child, or that she be in fear that a tragedy had happened to him... If the defendants owed the children a duty to care for their safety while swimming in the sea, then they also owed a duty to the mother, who was on the beach near the place where the children were brought after they were drawn out of the water, to protect her against the emotional shock that the sight of her drowned children was likely to cause" (Emphasis added - M.S.).

 

            (D) Based on the principles laid down in the above judgments, relatives who were involved in, or witness to, an accident to someone dear to them, caused by the defendant's negligence, and who suffered therefrom emotional injury in the form of shock, nervous breakdown or mental illness, were entitled to compensation for their injuries. In C.C. (Tel Aviv) 582/72 [13] the plaintiff was present at the accident to her son which resulted in his death. A medical expert found that she suffered 10% permanent mental disability. The District Court, at page 80, awarded the mother compensation for pain and suffering "both for the suffering itself and because it was likely that her disability makes it more difficult for her to work than otherwise..." Other pecuniary damage was not proved.

 

            The same principles have been applied in matters adjudicated under the Compensation Law. In C.C. (Jerusalem) 907-09/81 [14], at page 458, the court considered the claim of a woman whose husband and two children were killed in a road accident in which she, too, was involved. She claimed compensation for "the shock and grief caused her when she witnessed with her own eyes the tragic results of the accident and the loss of her dear ones in this accident." No defined mental injury was proved. Relying on the principle concerning the plaintiff s presence at the scene of the accident, the court awarded her damages in the amount of 5% of the maximum sum payable under Regulation 2(b) of the Road Accident Victims Compensation Regulations (Calculation of Compensation for Non-Pecuniary Injury), 5776-1976 (cf. CA 4/75 [2], referred to above, which required proof of a "visible injury or illness").

           

            (E) This court affirmed the District Courts' position concerning compensation to a relative for his emotional injuries. CA 813/81 [3] considered, among other matters, a widow's claim for compensation for emotional suffering due to the death of her husband in a road accident. The widow was herself involved in the accident and sat beside her husband who drove the car.

           

            Deputy President, Justice M. Ben Porat, said the following in this context:

           

          "The argument that the widow should not be compensated for her emotional suffering as a result of her husband's death must be dismissed, in my opinion. She was in the car at the time of the accident, and her loss of consciousness was the result of this event and not unconnected with it. This is sufficient under the Israeli precedents, in my opinion, to recognize her cause of action for compensation for the suffering resulting from her husband's death: C.C. (Haifa) 910/69; C.C. (Tel Aviv) 582/72. There is similarly no reason not to interpret the term "bodily injury" in section 1 of the Compensation Law to include emotional shock caused to the injured person by the actual injury (and perhaps even by the possible injury) to a relative, and no one has argued otherwise in the proceedings before us. It should be noted that the English judgments in recent years reflect a departure from the demand for immediate presence as an eye witness (McLoughlin v. O'Brian (1982)). In any event, it is the fact that the widow received a shock from the very event which was common to her and to her husband. It would, therefore, be artificial to separate her suffering in consequence of the shock caused by the event itself, from her suffering caused by the death of her husband when the event occurred".

 

            (F) To sum up, the Israeli courts have allowed a first-degree relative's claim and have awarded him damages on account of emotional injury caused him when he was witness to a negligent act or omission, committed by the defendant against his dear one, that caused such person actual injury or death. The rule is the same when the relative was at least in the vicinity of the scene of the event.

           

            So far as a cause of action under the Civil Wrongs Ordinance is concerned, it has been held that in such circumstances the defendant owes the plaintiff relative a duty of care not to cause him to suffer any mental shock, since a reasonable person, in such circumstances, should have foreseen that the plaintiff, who witnessed with his very own eyes the tragic occurrence to his dear one, will be injured emotionally as a result thereof. Foreseeablity of the injury has been the key to the establishment of the duty of care owed to the relative, as an independent duty separate from the duty of care which the wrongdoer owed to the direct victim who was injured bodily as a result of the breach of the duty of care in the same event.

           

            Concerning the cause of action under the Compensation Law, the relative who was present was recognized, by virtue of the same principles, as an "injured person" in a "road accident", who is entitled to compensation under the Law and the Road Accident Victims Compensation (Calculation of Compensation for Non-Pecuniary Damage) Regulations.

 

            9. The English Precedents

           

            The Israeli courts have referred to English law in connection with the question before us. It would not be superfluous, therefore, to examine, by way of comparison, the developments in English law.

           

            (A) The issue of mental injury, in its various forms, has been examined in English law with the greatest of caution. This restraint has its source in two central considerations.

           

            First, there was the fear that the treatment of injuries in man's mental system with the concepts and the same legal framework as are used with respect to bodily injuries could flood the courts with baseless claims based either on deliberate deception or false illusions. Doubt was also expressed in this context concerning the reliability of medical opinions, with regard to both the very existence of mental injury and the causal connection between the injury and the defendant's negligence. The English courts tended to regard mental injury as incidental to bodily injury, hence their reluctance to recognize mental injury, standing by itself pure and simple, as compensable. They required that the mental injury be accompanied by external physiological consequences (such as a miscarriage or a heart attack) or that there be a severe mental injury (such as hysteria or neurotic fright).

           

            Second, there was the fear that if liability for mental injuries per se were recognized, this would impose too heavy a burden on the conduct of the person who is required to refrain from causing such injury to a fellow-man (see J.G. Fleming, The Law of Torts (Sydney, 7th ed., 1987) 145; H. Street, The Law of Torts (London, 8th ed., by M. Brazier, 1988) 177).

 

            This is the basis of the judgment handed down by the Privy Council in 1888 (Victorian Railways Commissioners v. Coultas (1888) [22]). In that case a woman claimed compensation for the nervous shock caused her by the negligence of the person in charge of a railway gate who allowed the carriage in which she was travelling to cross the railway tracks just a moment before the train passed. As a result of the shock which she suffered she miscarried. The Privy Council allowed the defendant's appeal against the judgment of damages in the lower courts. It stated in the judgment, at page 225:

 

"According to the evidence of the female plaintiff her fright was caused by seeing the train approaching, and thinking they were going to be killed. Damages arising from mere sudden terror unaccompanied by any actual physical injury, but occasioning a nervous or mental shock, cannot under such circumstances, their Lordships think, be considered a consequence which, in the ordinary course of things, would flow from the negligence of the gate-keeper."

 

            (B) In the judgment in the case of Dulieu v. White & Sons (1901) [23] the above approach was abandoned for the first time, and the court recognized liability for the injury to a pregnant woman who miscarried as a result of nervous shock occasioned when a cart to which a horse was harnessed was driven negligently into the inn in which she was at the time. It was stated in the judgment that in order for the shock to be compensable, it had to flow from fear, that was reasonable in the circumstances, of physical injury to the person himself.

           

            In the judgment in the case of Hambrook v. Stokes Bros. (1925) [24] the Court of Appeals recognized the right of a mother to compensation for the nervous shock she suffered because she saw a lorry roll down a hill toward the place where her children were at the time. It transpired, in the end, that one of the children was injured. The mother died a few months later. An action was brought against the driver of the lorry who had negligently parked it in such a way that it began rolling down the slope of the hill by itself. It should be stressed that the mother herself was not exposed to threat of bodily harm from the lorry and that only her children were endangered. It was held that there was no logic and reason to distinguish between a mother's fear of threat of injury to her children and her fear of injury to herself. In the words of Bankes I, at page 151:

           

"Assume two mothers crossing this street at the same time when this lorry comes thundering down, each holding a small child by the hand. One mother is courageous and devoted to her child. She is terrified, but thinks only of the damage to her child, and not at all about herself. The other woman is timid and lacking in the motherly instinct. She also is terrified, but thinks only of the damage to herself and not at all about her child. The health of both mothers is seriously affected by the mental shock occasioned by the fright. Can any real distinction be drawn between the two cases? Will the law recognise a cause of action in the case of the less deserving mother, and none in the case of the more deserving one? Does the law say that the defendant ought reasonably to have anticipated the non-natural feeling of the timid mother, and not the natural feeling of the courageous mother? I think not."

 

            Later on the judge enumerates the factors which the injured mother's husband must prove in order to succeed in an action for compensation (id., at p. 152):

           

"... that the death of his wife resulted from the shock occasioned by the running away of the lorry, that the shock resulted from what the plaintiffs wife either saw or realised by her own unaided senses, and not from something which someone told her, and that the shock was due to a reasonable fear of immediate personal injury either to herself or to her children."

 

In sum, the conditions are:

 

(1) Shock caused by the threat to the woman or to her children.

 

            (2) Direct perception of the event, that is seeing or hearing the injury, as opposed to being informed about it by someone else.

           

            (3) Reasonable fear of injury to herself or to her children.

           

            (C) The first case, on the issue before us, that reached the House of Lords concerned a woman who, when getting off a tram, was witness to an accident in which a bicycle rider, who rode negligently, collided with a car. The bicycle rider was killed. The plaintiff heard the sound of the crash of the collision and saw the blood on the street after the body was removed from the scene. The plaintiff, who was pregnant, miscarried as a result of the shock. The reference is to Bourhill v. Young (1942) [25]. The House of Lords dismissed the woman's appeal on the ground that the bicycle rider owed no duty of care toward a person who it could not be foreseen would be injured bodily or mentally as a result of his negligent conduct. It was held that a reasonable person could not foresee, in the circumstances of the case, that a passer-by with ordinary phlegm and fortitude would suffer emotional shock as a result of the noises and the sights which the plaintiff experienced. This judgment laid down the basis for the rule that the question of compensation for emotional shock must be resolved in each case according to the foreseeability test. Compensation would be awarded only when a reasonable person in the wrongdoer's position would have foreseen that the plaintiff would suffer nervous shock as a result of his negligent act.

 

            In the words of Lord Porter, at page 409:

           

"The question whether emotional disturbance or shock, which a defender ought reasonably to have anticipated as likely to follow from his reckless driving, can ever form the basis of a claim is not in issue. It is not every emotional disturbance or every shock which should have been foreseen. The driver of a car or vehicle even though careless is entitled to assume that the ordinary frequenter of the streets has sufficient fortitude to endure such incidents as may from time to time be expected to occur in them, including the noise of a collision and the sight of injury to others, and is not to be considered negligent towards one who does not possess the customary phlegm."

 

            Later judgments adopted the test laid down by the House of Lords in the Bourhill case. Thus, for example, a father was given compensation for emotional shock caused him when the defendant drove his car backwards onto his son's leg. The father did not see the accident, but heard his son's screams from nearby. Boardman v. Sanderson (1964) [26]. On the other hand, in another case a mother's claim was denied where, upon hearing screams, she looked out of the window and saw her son under the wheels of a taxi (King v. Philips (1953) [27]. It was held, at page 442:

 

"The taxicab driver cannot reasonably be expected to have forseen that his backing would terrify a mother 70 yards away..."

 

            The judgment in King [27] was severely criticized, mainly because, in the light of the rule laid down in Hambrook [24], there was no ground to distinguish between the two cases (see, for example: H. Teff, "Liability for Negligently Inflicted Nervous Shock" 99 L.Q.R. (1983) 100, 101; fleming, supra, at 149 n. 79).

           

            (D) To sum up, until the leading judgment by the House of Lords in McLoughlin v. O'Brian (1982) [28], which will be referred to below, the rule which guided the English courts in the matter of compensation for nervous shock was as follows:

           

            (1) The right to compensation exists only for a relative who is very close to the victim of the accident;

           

            (2) The right is limited to a relative who was present at the scene of the accident, or was in very close proximity to it.

           

            In the words of Street, supra, at 179:

           

"The limits on liability established by analysis of the case-law up to 1982 appeared to be that the plaintiff should be present at the scene of the accident, or very near to it, so that with his unaided senses he realised what had happened, and that generally he must be very closely related to the person suffering physical injury. Indeed in the vast majority of cases the plaintiff has been the parent of a young child".

 

            10. (A) A leading judgment on our subject is that of the House of Lords in McLoughlin [28].

           

            The plaintiff, Mrs. McLoughlin, was at home when her husband and three children went for a drive in the family car. A lorry collided with their car two miles away from the house. It was determined that the accident occurred as a result of the lorry driver's negligence. Mrs'. McCIoughlin's daughter was killed and her husband and two other children were injured in varying degrees. Mrs. McLoughlin was informed about the accident an hour later and immediately went to the hospital to which the injured were taken. There she saw her injured family in the state in which they were brought from the scene of the accident and grasped the extent of the disaster that had befallen her. As a result of her tragic experience, the plaintiff suffered "severe trauma, organic depression and a change of personality, accompanied by physiological manifestations" (i.e., mental injury with physical-external expression): id., at p. 301.

 

          The lower court thought that the defendants did not care Mrs. McLoughlin a duty of care since her injuries from shock were not foreseeable in the circumstances. The Court of Appeal held that the injury caused to her was foreseeable, but refused to recognize a duty of care in the circumstances, since Mrs. McLoughlin was not present at the scene of the accident and there was no basis in the existing precedents for finding liability in these circumstances. In other words, considerations of judicial policy caused the appellate court not to recognize liability in tort, despite the finding concerning foreseeability.

         

          (B) The House of Lords reversed the decision and Mrs. McLoughlin's appeal was allowed. The rule which was established there was that a relative, who suffered mental shock as a result of seeing an accident or its immediate aftermath, could recover compensation from the negligent wrongdoer, if the shock which was caused to him was reasonably foreseeable in the circumstances of the case. This judgment, which is considered till today to be the leading judgment on the subject, examined the existing English case-law and laid out the central rules in the matter before us.

         

          Lord Wilberforce was of the opinion that Mrs. McLoughlin's case could be examined in the light of the precedents which had been established in England until that time and could be seen to be an additional link in the chain, that is, a direct and natural continuation in the development of the law. In his opinion, one could claim compensation for nervous shock caused by negligence, under English common law, and the plaintiff need not prove that he suffered bodily injury or fear of such bodily injury, it being sufficient that there was such injury, or the fear thereof, to a person close to him (his spouse or child). Until then, as indicated, the courts had recognized liability for injury caused when the plaintiff saw or heard, that is, when he was present at the scene of the accident in which his close relative was injured, or even if he did not see or hear it, but he arrived at the scene immediately thereafter and discovered its immediate aftermath.

 

            Lord Wilberforce was of the opinion, therefore, at page 302, that:

           

"If one continues to follow the process of logical progression, it is hard to see why the present plaintiff also should not succeed. She was not present at the accident, but she came very soon after on its aftermath. If, from a distance of some 100 yards... she had found her family by the roadside, she would have come within principle 4 above. Can it make any difference that she comes on them in an ambulance, or, as here, in a nearby hospital, when, as the evidence shows, they were in the same condition, covered with oil and mud, and distraught with pain?”.

 

            Further on in his judgment Lord WilbeKorce reiterated the principle (which he had laid down in his judgment in Anns v. Merton London Borough (1978) [29]) that foreseeability of the damage is not sufficient per se to establish a duty of care and liability for compensation in tort, but that one should set out the boundary-lines of liability on the basis of considerations of legal policy, and one should consider whether it is proper to impose responsibility toward every person whose injury is a likely probability in the circumstances. In other words, foreseeability of damage is an essential condition but not a sufficient one; particularly when the damage is of the nature of mental shock or disturbance, which could, in the natural course of events, occur to very many "secondary injured parties". There is, therefore, a real need to limit the scope of recoverable damages.

           

            Lord Wilberforce reviewed the considerations by which he thought one should be guided in establishing the limits of liability (such as, for example the fear that the courts would be inundated with claims, ("the floodgates argument"), the fear of dissimilation and fraud, increasing the onus of insurance on road-users, etc.), and listed three factors which should be considered when examining liability for nervous shock. According to him, there are three policy constraints which it is essential to apply alongside, and in addition to, the foreseeability test. They are: the class of persons whose claims will be recognized; their proximity to the scene of the accident in time and place; and the means by which the shock was caused.

 

            As to the first element, the choice is between the closest of family relationships (parent-child) and opening the court portals to a casual passersby who happened by chance to be at the scene of the accident and suffered nervous shock in consequence thereof. The House of Lords did not need to decide this matter on its merits, since Mrs. McLoughlin's relationship with those who were physically injured in the accident was of the first kind. The view was expressed, on page 304, that:

           

          "the closer the tie (not merely in relationship but in care) the greater the claim for consideration. The claim, in any case, has to be judged in the light of the other factors, such as proximity to the scene in time and place, and the nature of the accident".

           

            Concerning proximity to the scene of the accident it was held that such proximity most certainly must exist, since it should not be forgotten that the plaintiff must prove that it was the defendant's negligence that caused the nervous shock and not later developments. It was further noted that experience shows that insistence upon physical presence at the scene of the accident is not realistic and is even unjust. Therefore, the claim of one who arrived immediately after the traumatic event and observed its immediate aftermath would not be dismissed. This is the "aftermath" doctrine, by means of which the courts overcame the demand for physical presence before the judgment in the McLoughlin case. In summing up this point, he said, at page 305:

           

          "Finally, and by way of reinforcement of 'aftermath' cases, I would accept, by analogy with 'rescue' situations, that a person of whom it could be said that one could expect nothing else than that he or she would come immediately to the scene (normally a parent or a spouse) could be regarded as being within the scope of foresight and duty. Where there is not immediate presence, account must be taken of the possibility of alterations in the circumstances, for which the defendant should not be responsible".

 

            As for the question of the means by which the shock was caused, there had not been any occasion which recognized the claim of a person who had suffered a shock as a result of receiving information from a third party, so that (page 305) -

           

"the shock must come through sight or hearing of the event or of its immediate aftermath. Whether some equivalent of sight or hearing, e.g. through simultaneous television, would suffice may have to be considered".

 

            It should be noted that Mrs. McLoughlin heard about the accident from a third party, who informed her about the tragedy to her home. But the duty of care which was recognized toward her concerned only what she saw with her own eyes, that is, the aftermath of the accident which she observed in the hospital and not the information she received before that second hand.

           

            (C) A second judge, Lord Bridge, also discussed the question of the appropriate legal policy and said the following in this context, at page 319:

           

"On the one hand, if the criterion of liability is to be reasonable foreseeability simpliciter, this must, precisely because questions of causation in psychiatric medicine give rise to difficulty and uncertainty, introduce an element of uncertainty into the law and open the way to a number of arguable claims, which a more precisely fixed criterion of liability would exclude. I accept that the element of uncertainty is an important factor. I believe that the 'floodgates' argument, however, is, as it always has been, greatly exaggerated. On the other hand, it seems to me inescapable that any attempt to define the limit of liability by requiring, in addition to reasonable foreseeability, that the plaintiff claiming damages for psychiatric illness should have witnessed the relevant accident, should have been present at or near the place where it happened, should have come on its aftermath and thus have some direct perception of it, as opposed to merely learning of it after the event, should be related in some particular degree to the accident victim - to draw a line by reference to any of these criteria must impose a largely arbitrary limit of liability. I accept, of course, the importance of the factors indicated in the guidelines suggested by Tobriner J in Dillon v. Legg as bearing on the degree of foreseeability of the plaintiff’s psychiatric illness".

           

            (D) The legal literature regards the positions of Lord Wilberforce and Lord Bridge as representing the majority opinion in the McLoughlin case [28]. Lord Scarman commented that there is no room for considerations of policy in this context and that the legislature should express its opinion on the subject. Lord Edmund-Davies examined the matter before him in light of the situation of the "rescuer", toward whom it has long been recognized there is a duty to take care not to cause him nervous shock (see: P. Handernon, "Shock and Policy: McLoughlin v. O'Brian" 15 U.W. Aust. L. Rev. (1983) 398, 401). Nevertheless, it is customary to distinguish between the approaches of the above two judges on the question of the application of legal policy considerations in establishing liability for negligence in tort. While Lord Wilberforce is though to have added to the pure test of foreseeability additional external conditions, Lord Bridge's stand is that such conditions are merely considerations for establishing the degree of foreseeability in the circumstances of the case. It would seem that the first approach is stricter and more dogmatic, while the second appears more flexible, since it does not obviate the possibility of recognizing liability in a future case in which foreseeability will be established despite the failure to fulfil all three conditions with respect to proximity and immediacy. An example can be found in the words of Lord Bridge himself, who was prepared to leave for further consideration the possible claim of a woman who read in a newspaper (accompanied by pictures) that the hotel in which her family was staying was burnt down and only later was informed that her entire family had perished, with the consequence that she lost her reason. In such circumstances, Lord Bridge said, the mental illness was most certainly foreseeable, and therefore, would compensation be refused only because of the lack of presence at the scene of the catastrophe and because the mosaic of tragic events was completed with the aid of imagination (see pages 319-320 of the judgment[28])?

 

            On the question of the decisive weight of considerations of policy in fixing the boundaries for liability for nervous shock, the majority opinion sides with Lord Wilberforce's system, with which Lord Edmund-Davies and Lord Russell concurred (see also in this connection Attia v. British Gas Plc. (1987) [30], at 463-464).

           

            Among the writers, there are those who prefer Lord Wilberforce's approach, which produces, it is argued, a higher degree of certainty and predictability. Thus, for example, R.A. Buckley, The Modem Law of Negligence (London, 1988) 23:

           

"Nevertheless it is submitted that it is likely to remain true that the application of the forseeability test is subject to some degree of qualification in this area. Accordingly Lord Wilberforce's overt recognition of this in McLoughlin v. O'Brian is to be welcomed. It is both more convincing and, insofar as the special factors can be specifically identified, likely in this unusual area to produce a higher degree of certainty and predictability than insistence that assertion of the foreseeability test leaves nothing further to be said".

 

            On the other hand, there are those who prefer to rely on the foreseeability test exclusively. For example, Teff, supra, at page 102:

           

"The key consideration is whether or not the plaintiff ought to have been in the contemplation of the defendant as someone who might suffer psychiatric illness, given the particular circumstances".

 

            11. Another judgment, which interpreted the McLoughlin [28] rule and discussed it sseveral aspects was handed down recently by the Court of Appeals in Attia [30]. There, a woman sued the gas company that installed a heating system in her home negligently, which caused the house to bum down. The claim was both for damage to property and psychiatric damage resulting from nervous shock. The Court of Appeal considered the question of liability for psychiatric illness whose origin was damage to property, as distinct from death or bodily damage to another. The plaintiff s right to compensation was recognized (see id., page 458, opposite the letter D). The facts in this case are different from the issue before us: whereas in the cases discussed hitherto the courts considered the legal possibility of recognizing a duty of care toward someone who was injured mentally in addition to the duty which was owed to the direct victims of the accident and which was breached; Attia recognized a duty of care not to act negligently toward the plaintiff as regards her property; and the question was whether the plaintiffs mental injury was not too remote and whether it was included within the scope of the duty that was breached.

 

            On the question of the dispute between Lord Wilberforce and Lord Bridge - that is, considerations of policy as against the foreseeability test simpliciter - Lord Justice Woolf said, at page 461:

           

"...differing views were taken by the members of the House of Lords in McLouglin v. O'Brian and by the members of the High Court of Australia in Jaensch v. Coffey on the question whether, if the injury was foreseeable, liability could be excluded as a matter of policy. Fortunately, for the purposes of this appeal I do not consider that it is necessary to resolve this divergence of opinion. Even assuming that the test is not confined to being one of foreseeability, I cannot conceive that, if the injury which the plaintiff alleges that she suffered was a foreseeable consequence of the defendant's negligence, there could be any overriding policy reason for preventing her recovering damages. As I have already pointed out, she could well have sustained physical injuries as well as the psychiatric injuries of which she complains when she would have been entitled to damages and in my view there can be no reason of policy for distinguishing between the two types of injury".

 

            12. Lord Justice Woolf refers above to the judgment of the Australian Court of Appeals in Jaensch v. Coffey (1983-1984) [15].

           

            In that case the plaintiff was a woman whose husband was hurt in a road accident caused by the defendant's negligence. The plaintiff, who was at home at the time, did not come to the scene of the accident but was brought to the hospital immediately thereafter, where she saw her husband being taken in and out of the operating room several times. Late at night she left the hospital and went home. During the course of the night she received several telephone calls in which she was informed that her husband's condition had deteriorated. She arrived at the hospital the following morning and during the course of the day it was not certain whether her husband would survive or not. In the end, the husband recovered and left the hospital after several weeks, whereas the plaintiff was soon found to be suffering from mental illness characterized by depression and a high degree of fear. It was found that the matters which she had seen and heard in the hospital on the night of the accident and the following day had caused the mental illness. The Court of Appeals, relying, inter alia, on the English decisional law in McLoughlin [28], awarded the plaintiff damages, applying the following rules:

           

            (a) One who claims for damages because of nervous shock, must prove, by expert medical testimony, that he suffers from "a recognized psychiatric illness".

           

            (b) The illness must be "shock induced", that is, it must be caused by a sudden shock, and not be the result of a continuous process of exposure to, and involvement in, the suffering of another, for example, by caring for him.

           

            In the words of Judge Brennan, at page 565:

           

          "A plaintiff may recover only if the psychiatric illness is the result physical injury negligently inflicted on him by the defendant or if it is induced by 'shock'. Psychiatric illness caused in other ways attracts no damages, though it is reasonably foreseeable that psychiatric illness might be a consequence of the defendant's carelessness. The spouse who has been worn down by caring for a tortiously injured husband or wife and who suffers psychiatric illness as a result goes without compensation; a parent made distraught by the wayward conduct of a brain-damaged child and who suffers psychiatric illness as a result has no claim against the tortfeasor liable to the child".

           

            (c) The psychiatric illness must flow from a negligent act of the defendant, who caused bodily injury to or endangered another. An act or omission of personal risk, that causes mental illness to another, cannot raise a right to damages.

           

            The court was unanimous insofar as the rules enumerated above are concerned. A majority of the judges of the Australian Court of Appeals supported the additional rules which will be enumerated later.

           

            (d) As stated above, there was general agreement that the plaintiff would not be entitled to damages for nervous shock caused by negligence unless

           

            "some recognisable psychiatric illness induced by shock was reasonably forseeable" (ibid, at 566).

           

            The minority were of the opinion that the foreseeability test is the only test that should be applied in establishing liability, whereas the majority (as the majority position in the McLoughlin case [28]) were of the opinion that the foreseeability test alone is insufficient, and that several external limitations should be added, whose origin is in considerations of legal policy. According to the majority approach, then, the foreseeability of injury as a probable result of the defendant's negligence is an essential condition, but not a sufficient one.

           

            (e) According to the majority opinion, another element which must be proved in order to establish the duty of care is that there be a relationship between the plaintiff and the person who was killed or injured or exposed to danger as a result of the defendant's negligence. The relationship must be "close and intimate" (ibid [15], at 555).

           

            (f) So, too, it is necessary that the plaintiff be present and perceive with his senses the accident or its immediate aftermath (Judge Deane, as Lord Bridge in the McLoughlin case [28], left the question of damages for mental injury reasonably and foreseeably resulting from information given to the plaintiff second hand for further consideration).

           

            (g) The plaintiff must prove proximity in time and place between the accident and its immediate aftermath, on the one hand, and the mental injury caused him, on the other hand.

           

            13. It is not superfluous to note that in some of the Australian states there is express legislation awarding compensation to a relative (a parent or a spouse) of one who is killed or injured or exposed to danger, who suffers mental shock. The compensation is not conditional on establishing an independent duty of care toward the relative or complying with the test of foreseeability. Similarly, proximity to the event in time or place is not required. As to other relatives of the direct victim, who are neither parents nor spouses, they are entitled to compensation if the accident occurred within the range of their sight or hearing (for fuller details, see Fleming, supra, at 150-15 l; and Jaensch [15], at 601-602).

           

            14. Interim Summary

           

            It would be useful to make an interim summary of the guiding principles that have taken shape in English common law over the years with respect to compensation for mental injury resulting from negligence.

           

            (A) A plaintiff seeking to recover compensation for mental injury must prove that he suffered "nervous shock". This has been interpreted to mean "any recognisable psychiatric illness", as distinct from sorrow, grief or any other mental distress, which are not compensable. The reference is, therefore, to a sick mental reaction, which has to be proved by means of suitable medical evidence:

           

"The plaintiffs right of action depends on proof of 'nervous shock'. It is clear from the cases that, for legal purposes, this term implies mental distress which results in an acknowledged medical condition, whether physical, such as a heart attack or miscarriage, or psychopathological, as with various neuroses, hysteria, schizophrenia or morbid depression. Emotional distress without objective symptoms will not suffice. Thus mere temporary sensations of fright, tension or anger, and feelings of grief, anguish or sorrow without more cannot ground an action" (Teff, supra, at 105).

 

            I shall enlarge upon the medical aspects of the subject (including the distinction between "primary" and "secondary" reactions to a traumatic event) at a later stage (see also Jaensch [15], at 600-60).

           

            (B) An additional requirement concerns the process of causation, or the manner in which the mental illness was caused, which is that it has to be shock induced. As explained above, the mental illness must be the immediate consequence of a sudden and severe emotional experience and not the product of the cumulative influence of the accident and its aftermath on the plaintiff.

           

            In Pratt & Goldsmith v. Pratt (1975) 116], the court of the State of Victoria, in Australia, dismissed the action of a mother who suffered mental illness, whose symptoms appeared weeks (if not months, as stated in the judgment) after the accident. It appears that the reason for dismissing the action was based more on the absence of a causal connection and the remoteness of the injury rather than on the .existence of a duty of care, since according to the facts of the case, the plaintiff witnessed the immediate aftermath of the accident but she failed to prove that her illness was "shock induced".

           

            Based on scientific criteria, this condition for imposing liability appears not to be connected to the foreseeability test, that is to the requirement that the mental illness which the plaintiff suffered was probably foreseeable as a result of the defendant's negligent act: one can find in the medical literature support for the opposite thesis concerning mental illness as a result of continuous pressure and strain resulting from exposure to and involvement in the aftermath of the physical injury caused to another. This condition is, therefore, external to the manner in which the duty of care is established and its source is in considerations of legal policy and the inclination to limit the circle of persons entitled to compensation for mental illness caused by negligence (see Fleming, supra, at 149 n. 85).

           

            In the Jaensch case [15], it was stated in this connection, at p. 601:

           

"There is also strong expert support for the proposition that there is a real - and foreseeable - risk that psychiatric illness may result from mental stress during the period consequent upon bereavement, particularly conjugal bereavement, or during a period of constant association and care of a badly injured spouse or other close relative independently of any shock sustained at the time of the actual death or injury. While it must now be accepted that any realistic assessment of the reasonably foreseeable consequences of an accident involving actual or threatened serious bodily injury must, in an appropriate case, include the possibility of injury in the form of nervous shock being sustained by a wide range of persons not physically injured in the accident, the outer limits of reasonable foreseeability of mere psychiatric injury cannot be identified in the abstract or in advance".

           

            (C) The nervous shock to the plaintiff must result from a negligent act that caused physical injury or threatened such injury to someone other than the defendant himself. Thus, for example, a pregnant woman, who had a miscarriage as a result of nervous shock she suffered when she saw a window-cleaner who, in the course of working outside a window, lost his hold and fell to the ground, would not be entitled to compensation even though her injury could have been reasonably foreseen in the circumstances (for discussion of this subject, which does not directly apply in our case, see F.A. Trindade, "The Principles Governing the Recovery of Damages for Negligently Caused Nervous Shock" 45 Camb. L.J. (1986) 476, 481-482, 484; F.A. Trindade, "Negligently Caused Nervous Shock - An Antipodean Perspective" 5 Oxford J. Legal Stud. (1985) 305, 307).

           

            (D) The plaintiff must show that the defendant owes him a duty of care not to cause him harm of the nature of mental illness which is foreseeable in the circumstances of the case. In other words, there must be foreseeability of mental illness caused by shock, but it is not necessary that the specific mental illness suffered by the plaintiff be foreseen or every stage of its development. It is sufficient to prove the causal chain with reference to foreseeability on the part of a reasonable person, in the circumstances.

           

            We have seen that considerations of legal policy have been superimposed on the pure foreseeability test, in order to limit the scope of liability and to deny recovery to some persons for various reasons (including the fear of imposing too heavy a burden on the defendants, of flooding the courts with actions, some of which are vexatious, and the like), despite the fact that their injury was foreseeable. Only thus, for example, can we explain the third principle enumerated above concerning the absence of compensation for mental injuries resulting from negligence that caused an accident to oneself. Furthermore, it would appear that limiting the compensable damage to mental illness (as opposed to lesser mental harm) derives from the same source. This is the reason also for the demand that the mental illness be caused by shock:

 

"...An examination of all the decided cases on nervous shock in Britain and Australia is more likely to lead to the conclusion that reasonable foreseeability by the defendant of some recognised psychiatric illness induced by shock cannot be the sole test for determining whether a duty of care is owed. If it were the sole test, it would be difficult to exclude, from those owed a duty of care, the close relative or friend who has no contact with the accident or its immediate aftermath but who suffers reasonably foreseeable nervous shock by reason of constant social contact, as loyal nurse or companion, with the injured victim" (Trindade, Camb. L.J., supra, at 484).

 

            15. As mentioned above, it is customary to enumerate three conditions which the plaintiff must fulfil in order to establish an action for compensation for mental injury, in addition to the requirement of foreseeability of the injury in the circumstances of the case. The common characteristic of these three conditions, which will be enumerated below, is that they relate to proof of proximity between the accident and its immediate aftermath, such as the death, injury or threat of injury to the direct victim, and the person who was injured mentally as a result thereof.

           

            The first condition is that there be a close relationship between the plaintiff and the direct victim of the accident. A family relationship of the first order (spouse, parents, children) is sufficient, of course. But a relationship of intimacy and care - a "tie of care" - not based on a family relationship, can also justify imposing liability. One who is injured mentally but is not within the category of "relative" will be deemed to be a casual passerby, toward whom there is no duty of care. However, liability was recognized in the past for the injury caused to a person who rushed to rescue persons injured in a terrible train accident and was hurt mentally as a result of the traumatic scenes he witnessed. (Allowance of compensation to a rescuer also stems from the consideration, based on the public interest, that such behavior should be encouraged; see Chadwick v. British Transport Commission (1967) [31]). It has been held in Australia that close work relations are also sufficient for this purpose: Mount Isa Mines Ltd. v. Pusey (1970) [17]. (For a fuller discussion of this subject, see Trindade, Cam. L.J., supra, at 486-489).

 

            According to the known medical information, the most important factor explaining the phenomenon of mental illness caused by injury to another is the extent and intensity of the relationship between the direct victim of the negligent event, who was killed or suffered actual or threatened injury, and the person who became mentally ill:

           

"Much of the artificiality surrounding the analysis of foreseeability in the cases could be avoided if the courts paid more attention to what medical science can tell us about the causes of nervous shock. Thus, in the absence of fear for himself, the crucial determinant of whether the plaintiff is so affected as to suffer from a 'recognisable psychiatric illness' is almost invariably the nature of his relationship with the victim. Since it is normally only when the relationship between plaintiff and victim is in fact exceptionally close that medical experience indicates a degree of reaction that would be compensable, fear of the floodgates seems misconceived" (Teff, supra, at 104).

 

And see also the Jaensch case [15], at 600.

 

            The second condition is that there must be proximity of place and time, between the accident and its aftermath, on the one hand, and the shock which caused the mental illness from which the plaintiff suffers, on the other hand. The origin of this condition is in the requirement that the plaintiff be present at the accident and see or hear the injury done to his relative. This condition has not been preserved in its original form but has been softened by the decisions over the years, so that what is required today is that the plaintiff be close to the accident or to its immediate aftermath. For example, though he is not present at the scene of the accident itself when it occurred, he learns of the tragedy from his own senses, at the first opportunity, for example in the ambulance or in the hospital to which the injured person was taken.

 

            "Laibility cannot rationally be made to depend upon a race between a spouse and an ambulance; it must depend upon what the spouse perceives, its effect upon her, and whether her perceptions and their effect are the reasonably foreseeable result of the defendant's careless conduct" (ibid, at 578).

           

            This condition is linked to the third condition, in addition to the condition of foreseeability itself, that the plaintiff must actually feel the effect of the accident and its aftermath with his own senses. This means that it is not sufficient that he receive the information second hand, even if it be imparted to him close to the event in time and in place. "What is required is that the plaintiff must actually experience the accident or its immediate aftermath himself.

           

            The source of these last two conditions concerning the direct contact and the degree of proximity in time and place between the plaintiff and the traumatic event is in the belief that the closer the plaintiff is to the tragic occurrence, the more likely it is that the mental injury he incurred was foreseeable as a probable consequence of the defendant's negligence. The theory is that the further one is distanced and removed from the scene of the accident the less likely it is that one would suffer mental injury as a result of someone else's death or bodily injury. The power of the severe event is softened and blunted so that it cannot any longer be said that the defendant should have foreseen that the plaintiff would suffer shock which would cause him mental illness (since, it must be remembered, the requirement is that the mental illness be shock induced); and although exposure to the later consequences of the accident (such as, through caring for the direct victim) can cause mental injuries, and even mental disease, this would be the product of a continuous process of confrontation with the results of the tragedy. As explained above, the requirement is that the mental illness result from sudden nervous shock. The assumption is that an event that is later than the tragedy itself and its results cannot cause so severe a shock as to develop into mental illness:

         

  "When the scene of an accident is left behind, and the perception of some later phenomenon induces a psychiatric illness in a plaintiff, the factual difficulties in the way of establishing negligence occasioning nervous shock are greatly increased though the principles are unchanged. The occurrence or existence of the later phenomenon, its sudden perception by the plaintiff and the inducing of the plaintiff s psychiatric illness must be proved to be the results, and the reasonably foreseeable results, of the defendant's conduct. But the separation in time and distance of the later phenomenon from the immediate consequences of the defendant's conduct may make it difficult to prove the elements of causation and reasonable foreseeability as they apply in cases of nervous shock. The cry of distress which summons a rescuer, spouse or parent to the scene of an accident may lose some of its urgency as time passes after the initial injury; later visits by a spouse or parent to the injured person in hospital may not be so distressing as to induce psychiatric illness in a spouse or parent of a normal standard of susceptibility - especially if the injured person's condition and treatment proceed without dramatic fluctuations. It may not be reasonably foreseeable that the perception of the injured spouse or child in hospital might induce a psychiatric illness" (ibid, at 570).

 

            The imposition of these two last conditions in addition to the requirement of foreseeability has been heavily criticized. The criticism stems from Lord Bridge's speech in the McLoughlin case [28], where he left open for further consideration the possibility of awarding compensation for mental illness suffered by someone who heard about the tragedy to his dear one from a third party. In the Jaensch case [15], too, Deane J left the said question for further consideration (id., at p. 608).

           

            The legal literature published after the above two judgments brings many examples of instances in which insistence upon the two conditions mentioned above would lead to illogical and even unjust results. For example, the existing law would not recognize the claim for compensation of a woman who, while watching her husband participate in a car race on television, sees that car catch fire with him inside and develops mental illness in consequence of the shock. Should the answer be different if the race were televised directly from a place near where she happened to be, so that the requirement of proximity of time and place would appear to be satisfied? Another example is that of a bedridden husband who cannot visit his wife who is injured in an accident, but he receives photographs and details from a third party which cause him to lose his mind. A third example brought is that of a blind and deaf grandfather waiting for his granddaughter on the opposite side of the street and because of his blindness and deafness he is unable to hear or see that she has fallen into a pit, negligently dug there, while crossing the street. (For further details, see Trindade, Camb. L.J., supra, at 490-493).

 

            These examples are presented to make the criticism of the above two conditions concerning "proximity" to the traumatic event more concrete. The theory behind the criticism is that application of these conditions could be arbitrary in certain circumstances, in which it can be said, despite their absence, that the mental injury was foreseeable and that considerations of justice and the public interest render it mete to impose liability in the circumstances.

           

            16. American Precedents

           

            (A) In the United States, too, there was consistent opposition in the judgments in the various states to the recognition of liability for purely emotional damage. The reasons have already been mentioned above, and will be repeated here briefly:

           

"There are at least three principal concerns, however, that continue to foster judicial caution and doctrinal limitations on recovery for emotional distress: (1) the problem of permitting legal redress for harm that is often temporary and relatively trivial; (2) the danger that claims of mental harm will be falsified or imagined; and (3) the perceived unfairness of imposing heavy and disproportionate financial burdens upon a defendant, whose conduct was only negligent, for consequences which appear remote from the 'wrongful' and (W.L. Prosser and W.P. Keeton, On The Law of Torts (St. Paul, 5th ed., by W.P. Keeton, 1984) 360-36 l).

           

            The American courts entrenched their reservations about providing legal protection not to be harmed or distressed emotionally by means of the following two "threshold rules", which the plaintiff had to satisfy before his right to be compensated for the harm caused to him would be considered.

           

            The first rule was that a claim may be brought for mental injuries only when they accompany, secondarily, bodily injuries negligently caused. When the bodily injury is not immediate, but occurs later, as a result of the mental injury (as in the case of a miscarriage following upon severe emotional upset), most of the courts established the condition that there be physical impact between the defendant and the injured person. The demand for physical impact also was satisfied by mild bodily injuries, such as a light push, dust in the eye or smoke inhalation. But in recent years the tendency in the judgments in the states is to recognise a cause of action in negligence for causing serious emotional distress, without distinguishing whether the plaintiff fell ill or was harmed because of it (ibid, at 364-365).

           

            The second rule was that where the mental injury is not the result of the plaintiff s fear for his own safety, but its source is in seeing bodily harm to, or the threat to the life or health of another, then a condition for the recognition of liability was that the plaintiff himself must be in the zone of physical danger created as a result of the defendant's conduct ("the zone of danger rule"). This rule was abandoned in a 1968 judgment of the Supreme Court of California, Dillon v. Legg (1968) [18]. Incidentally, this judgment served as one of the comer-stones upon which the McLoughlin ruling [28] was based.

           

            (B) The above Dillon case [18] recognized the right of a mother to compensation for mental injuries caused her as a result of witnessing a road accident in which her daughter was killed. It was expressly established that the mother witnessed the accident from a place in which she herself was absolutely safe physically. In other words, a duty of care not to cause the plaintiff mental injury will arise when a reasonable defendant would have foreseen that his negligent acts will cause mental injury to the plaintiff, or to persons of a like nature, as a probable consequence, in the circumstances of the case (see Dillon [18], at 919). It was further held there that three measures of proximity should be taken into account in establishing the probable foreseeability: "physical proximity", "temporal proximity", "relational proximity" (see Prosser and Keeton, supra, at 366).

 

            It was said there [18], at pages 920-921:

           

"We note, first, that we deal with a case in which plaintiff suffered a shock which resulted in physical injury and we confine our ruling to that case. In determining, in such a case, whether defendant should reasonably foresee the injury to plaintiff, or, in other terminology, whether defendant owes plaintiff a duty of due care, the courts will take into account such factors as the following: (1) Whether plaintiff was located near the scene of the accident as contrasted with one who was a distance away from it. (2) Whether the shock resulted from a direct emotional impact upon plaintiff from the sensory and contemporaneous observance of the accident, as contrasted with learning of the accident from others after its occurrence. (3) Whether plaintiff and the victim were closely related, as contrasted with an absence of any relationship or the presence of only a distant relationship.

 

The evaluation of these factors will indicate the degree of the defendant's foreseeability: Obviously defendant is more likely to foresee that a mother who observes an accident affecting her child will suffer harm than to foretell that a stranger witness will do so. Similarly, the degree of foreseeablity of the third person's injury is far greater in the case of his contemporaneous observance of the accident than that in which he subsequently learns of it. The defendant is more likely to foresee that shock to the nearby, witnessing mother will cause physical harm than to anticipate that someone distant from the accident will suffer more than a temporary emotional reaction. All these elements, of course, shade into each other; the fixing of obligation, intimately tied into the facts, depends upon each case".

 

                      (C) The judgment in the Dillon case [18] was adopted in a substantial number of states in the United States of America, while only a few continued to abide by the earlier requirement that the plaintiff must have been within the zone of physical danger.

         

          In some of the states which adopted the Dillon ruling the law further developed such that it abandoned the pure foreseeability test and applied the three criteria concerning proximity as principles of the substantive law limiting responsibility, rather than as tools for examining the existence of a duty of care, as had been expressly emphasized in the Dillon case (see further: P.A. Bell, "The Bell Tolls: Toward Full Tort Recovery for Psychic Injury" 36 U. Flo. L. Rev. (1984) 333, 338-340). Thus, the judgments of the Supreme Court of Florida in Champion v. Gray (1985) [19]; Brown v. Cadillac Motor Car Div. (1985) [20], represent the tendency to narrow the Dillon holding. In the Champion case [19] a mother witnessed her daughter's death in a road accident, fainted and died on the spot. It was held that although impact was not required - that is, there was no need for physical harm prior to the occurrence of mental injury, the mental injury must be accompanied by concrete physical results. Mental injury, alone, is not sufficient. In the Dillon case, too, the ruling was based on the assumption of mental injury that is expressed physically. The court thought that the plaintiff must establish the three additional criteria, in addition to the usual tests for foreseeability of injury, as set forth in detail below. Thus, the Dillon ruling, which had emphasized that these are criteria of foreseseeability, not additional conditions, was in fact narrowed thereby:

         

          "Foreseeability is the guidepost of any tort claim. Because we are dealing with an unusual and nontraditional cause of action in allowing damages caused by psychic injury following an injury to another, however, public policy comes into play and some outward limitations need to be placed on the pure foreseeability rule. We have already referred to the requirement of a significant discernible physical injury. In addition the psychically injured party should be directly involved in the event causing the original injury. If such a person sees it, hears it, or arrives upon the scene while the injured party is still there, that person is likely involved... Another factor in the foreseeability requirement is that the secondarily injured party must have an especially close emotional attachment to the directly injured person. A child, a parent, or a spouse would qualify; others may or may not, depending upon their relationship and the circumstances thereof' (Champion [19], at 20).

 

            On the other hand, the judgment of the Ohio Supreme Court in Paugh v. Hanks (1983) [21], is representative of the opposing thesis. In that case road accidents occurred on three separate occasions near the plaintiff s house, which was opposite a road junction that connected an interstate highway with a state highway. All three accidents also caused property damage as the cars involved hit the plaintiff’s courtyards. The plaintiff sued all three drivers, and claimed, in addition to her property damage, that she suffered "depression, including neurotic fear with depressive characteristics". The court held that it was not necessary that the mental injury be accompanied by physical manifestation. Instead, it held that it had to be "serious", page 765:

           

"In delineating the standards to guide Ohio courts in reviewing cases seeking damages for the negligent infliction of serious emotional distress, we wish to underscore the element of 'seriousness' as a necessary component required for a plaintiff-bystander in order to sufficiently state a claim for relief. We view the standard of 'serious' emotional distress as being a more reliable safeguard than an 'ensuing physical injury' requirement in screening out legitimate claims. By the term 'serious', we of course go beyond trifling mental disturbance, mere upset or hurt feelings. We believe that serious emotional distress describes emotional injury which is both severe and debilitating. Thus, serious emotional distress may be found where a reasonable person, normally constituted, would be unable to cope adequately with the mental distress engendered by the circumstances of the case".

 

            As to the three criteria established in the Dillon case [18] (physical proximity, temporal proximity and relational proximity) it was emphasized, on page 766, that these were guiding principles for establishing the existence of a duty of care and not prior conditions which the plaintiff had to prove in addition to the foreseeability of the injury:

 

"Concomitant with this test of foreseeability, we add several factors which should be considered in order to determine the reasonable foreseeability of a negligently inflicted emotionl injury to a plaintiff-bystander. These factors are by no means exclusive, and the mere failure of a plaintiff to satisfy all of them should not preclude an aggrieved party from recovery. Thus, the term 'factors' should be underscored to alleviate any misconception that such factors are requirements. The purpose of these factors is to assist and guide the determination of whether the serious emotional injury was reasonably foreseeable to the defendant at the time the accident (which precipitated the cause of action) took place".

 

            The legal literature published in the United States following upon the Dillon case and later judgments also set forth the two theories discussed above. Thus, for example, Bell's article, mentioned above, sets forth the thesis that tort damages can be recovered for any mental injury (the full recovery rule). The underlying principle is that every person is entitled to psychic well being, and this right should benefit from the protection of the law. The author supports his approach with various economic considerations, and, in his opinion, acceptance of his approach would reduce the overall cost of road accidents, on the one hand, while general principles of fairness and justice would be advanced, on the other hand. This approach was criticized in an article by R.N. Pearson, "Liability for Negligently Inflicted Psychic Harm: a Response to Professor Bell" 36 U. flo. L. Rev. (1983) 413.

           

            The Law in Israel - The Civil Wrongs Ordinance

           

            17. Until now we have discussed the legal thinking on our subject, as it has been developed in England, Australia and the United States of America. We return now to our own law. We shall first refer to the legal situation from the perspective of the law of negligence in tort, and then we will examine the application of the Compensation Law.

           

            18. (A) Let us now examine the legal criteria pertaining to the establishment of liability in tort for mental injuries caused to Reuben as a result of the death of, or injury or threat of injury to, Simon (Reuben's relative), by means of Levi's negligent act or omission.

 

            (B) The key to the solution of the question of liability lies in establishing the existence or absence of a duty of care, owed by Levi, the tortfeasor (whose negligence caused physical injury, or the risk of physical injury, to Simon, who is the immediate and direct victim of his act), and to Reuben, who was injured mentally as a result of the injury to Simon. We have seen that it has been held in England and the United States that, in certain circumstances, a defendant owes a duty of care in tort toward someone who is injured mentally, not to inflict such an injury on him, where the mental injury was the probable, foreseeable consequence of the defendant's conduct.

           

            (C) There are three building blocks in the process of establishing liability for the tort of negligence (Cr.A. 6/55 [4], at p. 1012; Cr.A. 402/75 [5], at p. 570):

           

            (a) the existence of a duty of care on the part of the tortfeasor toward the injured person;

           

            (b) a breach of the said duty;

           

            (c) causing injury as a result of the breach of the duty.

           

            With regard to the question of the duty of care, the first building block, we examine two aspects - one in principle, the other specific - that apply directly to the facts of the case (CA 145/80 [6], at p. 122). The aspect of principle deals with what is known as "the conceptual duty of care"; the specific aspect concerns the concrete duty of care. In the words of P.H. Winfield & J.A. Jolowitz, On Torts (London, 11th ed. by W.V.H. Rogens (1979) 67:

           

"The concept of the duty of care performs two distinct functions. If the plaintiff is to succeed it must be established first that the circumstances in which his damage was caused were capable of giving rise to a duty of care, and, secondly, that the defendant actually owed him a duty on the particular facts of the case."

 

            The first aspect, as stated, concerns the conceptual duty of care. In the words of my honorable colleague, Barak J, in Cr.A. 186/80 [7], at p. 776:

           

"The first aspect considers the conceptual question (the 'conceptual duty of care') whether the general categories to which the tortfeasor, the victim, the act and the injury belong can create a duty of care. According to Shamgar J, in CA 343/74, at p. 156:

 

'Reference to the existence or absence of a duty between one person and another is not anchored, fundamentally, in any particularized decision concerning the nature of the specific relations which should exist between the two individuals. Its existence is a matter of law, built on the general distinction and classification of types of injuries and types of wrongdoers and of victims, and its limits are influenced first and foremost by legal policy'".

 

            The existence of the conceptual duty of care is established on the basis of the foreseeability test, that is, according to the answer to the question whether a reasonable person should have foreseen the occurrence of the injury. My honorable colleague, Barak J, said in CA145/80 [6] supra, at p. 123:

           

"Normative foreseeability - where technical foreseeability exists in first - serves to limit the scope of liability. In principle, where injury can be foreseen technically, there exists a conceptual duty of care, unless considerations of legal policy negate the duty (see Lord Reid in Home Office v. Dorset Yacht Co. Ltd. (1970)). Such considerations of legal policy serve to strike a balance between the various interests struggling for priority. The court takes into consideration the need to ensure freedom of action on the one hand and the need to protect property and life on the other hand. It takes into account the nature of the injury and the manner in which it occurred. It takes into account the influence its decision will have on people's conduct in the future. It weighs the financial burden which will be imposed on a certain class of tortfeasors or victims in the wake of its decision. These and other considerations are balanced in the court's judicial consciousness, as it weighs them on the scales of justice, and based on them, the court fixes the scope and limits of the conceptual duty of care, which constitutes the consideration in the parallelogram of forces".

 

            In this connection recall the words of Lord Diplock in Dorset Yacht Co. v. Home Office (1970) [32], at 1059:

           

          "And the choice is exercised by making a policy decision as to whether or not a duty of care ought to exist..."

           

            Similar in spirit are Lord Wilberforce's words in the McLoughlin case [28], supra, at 303:

           

"It is not merely an issue of fact to be left to be found as such. When it is said to result in a duty of care being owed to a person or a class, the statement that there is a 'duty of care' denotes a conclusion into the forming of which considerations of policy have entered".

 

            (D) Does a conceptual duty of care exist in the relations between the tortfeasor and the injured person's relative in our case, as described above?

           

            Before we deal with this question in detail I must state that I accept the view that we do not refer merely to one, solitary duty of care, which carries others along with it, in numbers equal to the number of secondary victims. If that were the case, then we could deal with the problem before us solely on the basis of considering the degree of remoteness of the injury (see J.C. Smith, Liability in Negligence (London, 1984) 121-125).

           

            The duty of care owed to the person injured bodily (the main victim) and the duty of care owed to additional secondary victims arise and exist in parallel. We are concerned with an independent and separate duty of care between the tortfeasor and the person who is injured mentally. Incidentally, we call the one duty "primary", not because of the significance of its consequences in comparison with those of the "secondary" duty, since the consequences of a breach of the latter duty can be much more serious than those of a breach of the former duty (see the Jaensch case [15]. infra), but because a breach of the primary duty of care is a condition of fact for the other breaches, even when the consequences of the primary injury pass on before those of the secondary injury:

 

"Though the plaintiffs shock in these cases is typically consequent on the defendant's having injured or imperilled someone else, his cause of action is not dependent on, or 'secondary' to, the primary victim's. The defendant's liability arises from a breach of a duty of care owed to the plaintiff directly, not derivatively, even if it is generally at once also a breach of duty to the other. Thus it is no defense that the primary victim could not himself recover, be it because he suffered no injury or because he was contributorily negligent or because he lost his claim for some other reason" (Fleming, supra, at 150).

 

            In the Jaensch case [15], supra, the husband recovered from his injuries, but his wife - the plaintiff - developed a mental illness. The fact that the direct victim recovered was irrelevant to the question of liability towards the wife for the mental illness caused her.

           

            19. As stated, the considerations of legal policy serve to strike a balance between the various interests. Causing bodily damage by negligence is an event which occurs in the world of reality. This event, in the nature of things, is not confined to causing such damage alone, but has secondary consequences and incidental results, including its being the source of mental injuries of varied kinds and strength, caused to another. Thus, for example, causing bodily damage to one person can induce a variety of mental injuries to an indefinable number of victims, from the injured person's close relatives through the circle of his friends and, finally, to innumerable casual passers-by who witnessed the event itself by chance, or read about it in a newspaper or saw its immediate consequences in a television broadcast.

           

            Establishing the limits of tort liability in a matter such as that before us, on the basis solely of the possibility of the physical foreseeability of any kind of mental injury, would mean that the tortfeasor, who negligently injured someone physically, would find himself obligated to compensate a great number of people, whose feelings and mental stability were in some way affected by his negligent act. This result, naturally, would not be reasonable, both because of the heavy burden it would impose on the tortfeasor in particular and on human conduct in general, and because of the burden it would impose on the judicial system, by seeking to harness it to the cause of spreading the law's protection over the interest not to be injured mentally. The application of the foreseeability test exclusively would lead to a multiplication of claims, including, in all probability, claims on account of trivial damage, and baseless and false claims. The judicial system which, because of its limitations, copes with great difficulty with the flood of litigation even today, would be faced with double and perhaps even triple, the number of cases connected with each accident: a reasonable legal policy cannot lend its hand to this.

 

       20. A filtering device is therefore required, within the framework of establishing the conceptual duty of care, which will select from amongst all the foreseeable mental injuries only those which deserve to be included within the bounds of liability. One can try to enumerate the various considerations on the basis of which the existence of liability for compensation for mental injuries should be assessed. Of course, this is not an exhaustive list and it is subject to the test of judicial practice and the development of the law from case to case.

      

       (A) The Identity of the Plaintiff - The case under consideration before us does not require us to decide this question directly, since both appeals concern first-degree relatives (parents; daughter), who claim to have suffered mental injury as a result of the bodily injury inflicted on their dear ones.

      

       It is logical to establish, at this stage, a condition that the action may be brought by first-degree relatives (parents, children, spouses) only. We have seen that according to known medical data, the process of causing mental damage and its severity are to a considerable extent the result of the degree of relationship which existed, in fact, before the accident, between the primary victim of the accident and the person who became mentally ill as a result thereof. That is, the degree of actual intimacy and relationship is a very important factor. In other words, there is a degree of relationship that speaks for itself in which the mental effect of the injury is foreseeable, but other different degrees of relationship could produce the same results. It is, therefore, proper to leave the question whether to add to the list of first-degree relatives, in exceptional cases, an additional victim whose right not to be injured mentally would be deemed worthy of the law's protection, for future consideration by the courts .

 

            (B) Direct Perception of the Tortious Act - The foreign precedents require that the plaintiff be an eye- and ear-witness to the traumatic event or that he discern its immediate aftermath by means of his own senses (whether as an element of the foreseeability test or as a limiting condition extraneous to the foreseeability test). On the other hand, we have seen that the demand for a direct perception of the tortious act, as a material bar to imposing liability, has been strongly criticized. This criticism argues that the possibility of recognizing mental injury caused by information received second-hand from a third party should not be barred.

           

            It is obvious, on the face of it, that the nearer the plaintiff was to the tortious act and the more he perceived its traumatic impact himself, the more the mental injury he suffered was foreseeable as a probable consequence in the circumstances. When there is distance from the events as they occur and the information about them is received second hand, one may reasonably conclude that the strength of the difficult events has become blunted and softened, and in such circumstances, the foreseeability of real mental injury decreases. This is so generally, but not always. I do not think that we should establish a preliminary condition that the right to compensation should be denied, at the very threshold, to a relative who was not present at the scene of the accident and who does not, therefore, comply with the condition that he perceive it directly, though his injury was foreseeable in the circumstances. We have seen that there are many examples of situations in which it can be imagined that insistence on the demand for direct perception of the injurious event would lead to unjust results. It is therefore proper, in my opinion, to adhere to the foreseeabiity test in this connection, that is, to examine in each case whether the plaintiffs injury - even if caused by second-hand information - was foreseeable in the overall circumstances of the case as a probable consequence of the defendant's negligent conduct. The manner in which the information was received should be considered in this framework. I would not deny compensation, where appropriate, for the injury caused, for example, by listening to a verbal report, as described above. Incidentally, seeing the catastrophic occurrence while fortuitously watching television appears to me, logically, equivalent to direct observation of the event at its scene.

 

            (C) degree of Spatial and Temporal Proximity to the Injurious Event - Another condition established in the foreign precedents for recognizing liability for mental injury is that the plaintiff be a witness to the accident or to its immediate aftermath. In this context, the arena of events also includes the ambulance or the hospital to which the person who was bodily injured was taken, but not beyond this.

           

            A distinction was drawn between two possible scenarios in connection with this question: the first, when the mental injury was created by shock, which was caused to the plaintiff whose initial encounter with the injurious event was by observing its later consequences, far from the scene of the events (for example, a parent who was abroad when he was informed of an accident to his child and arrives at the hospital a few days later; or when the accident victim's body is not identified on the spot, but in the hospital, some time after the accident, as, for example, in the case of a mass catastrophe). The second, when the mental injury is the product of a continuous process of exposure to the consequences of the injurious event. Here, the mental injury is not created by way of a one-time experience, but it is the result of constant and continuous contact with the developments after the injurious event occurred, in a manner that leads finally to the creation of mental injury (for example, mental injury caused to a relative - a parent or a spouse - who cares regularly for someone physically injured by the injurious event).

           

            It would not be superfluous to quote, in this context, the following words Of Deane J in the Jaensch case [15], at 606-607:

           

            "...it would seem reasonably clear that the requisite duty relationship will not, on the present state of the law, exist in a case where mere psychiatric injury results from subsequent contact, away from the scene of the accident and its aftermath, with a person suffering from the effects of the accident. An example of psychiatric injury suffered as a result of such post-accident contact is that which may result from the contact involved in the nursing or care of a close relative during a period subsequent to immediate post-accident treatment: see, e.g. Pratt. There are at least two possible rationales of the distinction, for the purposes of the requisite duty relationship, between cases where psychiatric injury was sustained as a result of direct observation at the scene of the accident and its aftermath and cases where the psychiatric injury was sustained from subsequent contact, away from the scene of the accident and its aftermath, with a person suffering from the effects of the accident. One such rationale lies in considerations of physical proximity, in the sense of space and time between the accident and its immediate aftermath on the one hand and the injury on the other. The other lies in considerations of causal proximity in that in the one class of case the psychiatric injury results from the impact of matters which themselves form part of the accident and its aftermath, such as the actual occurrence of death or injury in the course of it, whereas, in the other class of case, the psychiatric injury has resulted from contact with more remote consequences such as the subsequent effect of the accident upon an injured person. The choice between one or other or a combination of these two distinct rationales may obviously be of importance in the more precise identification of any essential criteria of the existence of the requisite duty relationship. On balance, I have come to the conclusion that the second, which justifies the line of demarcation by reference to considerations of causal proximity, is to be preferred as being the less arbitrary and the better attuned both to legal principle and considerations of public policy" (Emphasis added - M.S.).

 

            Both situations described above concern mental injury that occurs after the injurious event and removed from it, but in the one instance the injury is the product of the initial encounter between the plaintiff and the results of the injurious event, while in the second case the injury is the product of a series or succession of encounters that culminate in creating mental injury.

           

            As to the first set of circumstances described, there is, in my opinion, no justification to decide arbitrarily in advance what would be sufficient proximity in space and in time as a condition for imposing liability. In general, the further one is removed in space and in time from the scene of the harmful event, the less foreseeable is the mental injury likely to be (see laensch [15] at 601, quoted in paragraph 13(B) above). Direct and contemporaneous observation of an accident in which a beloved person is injured is not the same as a visit some time later to the hospital in which he is confined. The first situation involves a sudden shock resulting from a sudden and dramatic event, whereas the second entails an experience which could indeed be harsh and depressing but does not contain the surprise and is not as drastic as presence at the injurious event itself. However, as already stated, generalizations are not in place and each case should be examined on its own merits, whether the wrongdoer, as a reasonable person, should have foreseen the likelihood that injury would occur, in the circumstances, as a result of the negligent event. Furthermore, it should also be remembered that in addition to determining the duty of care, the injury incurred must be causally related - both factually and . legally - to the harmful event. In examining the question of causality, especially when the injuries occurred far away, in time and space, from the negligent act, attention must of course be given to the influence of later events on the establishment of liability.

           

            As far as the second set of circumstances described above is concerned, that is, the occurrence of mental injury as the result of a continuous process of exposure to the results of the harmful event, such injury is not compensable according to the foreign precedents. The reason for this is not linked to considerations of foreseeability, since it is often foreseeable that continuous and constant contact with someone who was physically injured by a harmful event (for example, by taking care of him) would ultimately lead to the development of mental injury, even of a severe nature. The requirement that the mental injury be shock induced is based on considerations of legal policy and on the sense that it would impose too severe a burden on the tortfeasor to be responsible for such damages.

           

            It should be remembered that we are concerned here with the establishment of an independent and separate duty of care that the tortfeasor owes to the one who was injured mentally, to avoid causing him injury, that is, that the tortfeasor should not cause such injury by his acts.

 

       In contrast to the criteria adopted by other countries, I do not see the need to advance the distinction between injury caused on the spot, as an immediate result of shock from the main injury, and damage caused at a later stage. The proper distinction should be according to the extent of the damage. As held, for example, by the court in the Paugh case [21], supra, what should govern is the severity of the damage as a result of which the victim is deprived of his ability to cope with the mental pressure. Such severe injury may stem from the shock of immediate observation, while even more severe damage might result from the continuous observation of a dying child's suffering. The requirement that the injury be shock induced appears to me to a large extent artificial. It would be more in keeping with the demands of logic and justice that the governing test should be causal proximity and clear proof of real and definite mental injury, not proximity of time and place.

      

       (D) What is Mental Injury - We have seen above that the rule in England and the United States is that the plaintiff must suffer severe mental injury before he will be entitled to a remedy. This requirement is phrased in different ways: a substantial recognized mental illness, mental injury with physiological manifestations, severe mental injury, and the like. The idea at the basis of this condition is that legal protection should be given only to mental injury that clearly and obviously amounts to illness, since slight mental harms are an everyday matter in the reality of our lives and a person must overcome them by his own means. These injuries, such as distress, pain and anger are, in the nature of things, temporary and ephemeral and should not be compensable even if they do not disappear. In general, they furnish no justification to impose liability on the wrongdoer, on the one hand, and one should also not burden the legal system on their account, on the other hand. It should be emphasized and reemphasized that in the absence of any clear criterion, there is a substantial reason to fear the false creation of injuries that never occurred. The absence of acknowledged medical classification would also make it extremely difficult to estimate the extent of the injury, and might even prevent it  completely.

      

            In CA 243/83 [8] my honorable colleague, Barak I, held, at p. 142, that "... non-property injury, too, is injury for purposes of the tort of negligence, and it is compensable, if a reasonable person had the duty (both conceptual and concrete) to foresee its occurrence because of the negligence". He said further that "... according to all considerations of legal policy there exists a (normative) duty to foresee non-property injury to a person who is within the primary circle of risk, that is, the person against whom the injurious act was aimed... We can leave for further consideration whether additional victims, who suffer non-property injury, come within the scope of those who must be taken into account as likely to be injured" (Emphasis added - M.S.). In our case the direct victim of the negligent act is the person who was killed, injured or imperilled. The duty owed to him not to cause him any bodily injury was infringed. The victim's relatives who were injured mentally as a result of the injury to him come within the "circle of secondary risk" and, therefore, we must examine the question whether all purely non-property damage caused to a relative is sufficient to create liability toward him. Clearly, this is a question of the duty to foresee from a normative aspect, since some mental injury will generally be an automatic consequence of the negligent event.

           

            Without laying down any hard and fast rule, it appears to me that there are weighty reasons to limit compensable damage to substantial mental reactions (as distinguished from negative human reactions that the person who experiences them can cope with and overcome them by his own means) as, for example, mental illness plain and simple (a psychosis) and other clear and severe, and even continuing, mental ailments (neuroses), though they do not amount to mental illness per se. This question will undoubtedly recur to be considered by the courts from case to case, taking into account the circumstances of each case and the evidence of medical experts that will be adduced. But it is clear that cases that do not come within the definition of recognized psychoses can serve as a basis for an action only in clear and serious instances.

           

            21. The Law in Israel - The Road Accident Victims Compensation Law

           

            The two appeals before us involve events which were road accidents within the meaning of the Compensation Law and therefore an additional question to be answered is whether the applicants in LCA 452/87 and the appellant in CA 80/88 are entitled to compensation for the injury they suffered as "injured persons" to whom "bodily injury" was caused in a "road accident".

 

          Section 1 of the Compensation Law defines an "inured person" as "a person to whom bodily injury has been caused in a road accident". 'Bodily injury" is defined to include mental or cognitive defect". Hence, the injury in both cases before us is "bodily injury". The question is whether this injury was caused in a "road accident". "A road accident" is defined as "an event in which bodily injury is caused to a person as a result of the use of a motor vehicle" (Emphasis added - M.S.). The combination of these definitions creates the condition that an "injured person" must be a person to whom bodily injury has been caused in an event in which a person was caused bodily injury as a result of the use of a motor vehicle.

         

          The Jerusalem District Court held, in the combined cases LCA 452/87 and LCA 444/87, that:

         

          "the word 'in' points to direct injury in an accident, at the time and place of its occurrence and by virtue of its force. It does not say 'because of an accident', nor does it say 'in consequence of an accident'. It says 'in an accident', which indicates that the reference is to a direct injury".

         

          The District Court relied also on the opinion of Professor I. Englard, Compensation for Victims of Road Accidents (Yahalom, 5739) 30 n. 78, and on Professor D. Kretzmer "Road Accident Victims Compensation Law, 5735-1975" Lectures Given During Discussion Session for Judges 5736 (The Hebrew University and The Courts Administration, S. Shitreet ed., 5737) 113, 116-117, according to whom a shock which occurs at a distance from the scene of an accident is not a "road accident" within the meaning of the law. This was the opinion also of the Nazareth District Court in CA 80/8, which also supported its opinion by considerations of legal policy, as follows:

         

          "The law is designed to provide a remedy for victims of road accidents, by imposing an absolute duty of compensation. On its face, the legislator's intent was to provide for the injuries of persons actually involved in the accident, and since this is one of the possible interpretations of the law's terms, - and the more common one at that, in every day parlance - I think it should be adopted rather than interpret the law in a way that expands the scope of liability".

           

            22. (A) From the point of view of legal policy, it is of course desirable that there be a unified approach in tort actions and actions under the Compensation Law that relate to the same accident. There is no sense or logic in a situation in which the main victim sues under the Compensation Law while the relative who is mentally injured sues under the Civil Wrongs Ordinance, particularly since in the case of a road accident both claims will be based on the same insurance policy. Of course, on the other hand, it can be argued that in fixing absolute liability the legislature intended to provide compensation only to one "actually involved" in an accident, and that the law should not be interpreted so as to expand the bounds of liability. The answer to this argument is that the legislature's main aim was that, in light of the extent and frequency of road accidents, it should no longer be required to litigate the question of guilt, and from this aspect, therefore, it is not necessary to interpret the law so as to confine its application to the main victim alone.

           

            (B) The central question is, of course, whether the Compensation Law, as it stands, can encompass liability such as that under consideration here.

           

            The answer to this question is in the affirmative. My honorable colleague, Barak J, discussed the question of interpreting the term "road accident", inter alia, in CA 358/83 [9]. As said there, an event in which a person is injured bodily is a road accident under that law if the injury was caused "in consequence of' the use of a motor vehicle, that is: where there is a causal connection between the use of a motor vehicle and the injury, then there is a road accident. The expression "in consequence of', in the Compensation Law, includes not merely the causal-factual test but also a causal-legal connection, which selects from amongst the sine-qua-non causes those causes which, because of their nature, provide a basis for imposing liability (id., 862-863). To quote Judge Orr in another case, as referred to in the same judgment, at p. 864:

 

"Much has been written about the nature of the required causal connection or, in other words, the nature of the use to which a vehicle must be put so that the injury which is caused will be regarded as having been caused 'in consequence of the use of a vehicle' within the meaning of the Law. The District Courts have deliberated hard to solve the problem of finding the redeeming formula... Most of the disputes concerning the meaning of the required legal causal connection derive from the fact that the Law does not define the nature of this connection clearly, but leaves the matter to the courts. It has been left to the courts, therefore, to resolve this matter on the basis of the appropriate legal policy, all the while it is difficult to anticipate the great variety of instances which will require such resolution, and occasionally the court is forced to decide on the basis of facts which it can be assumed that the legislature did not foresee, and perhaps could not have foreseen (C.C. (Nazareth) 230/86, at p. 233)".

 

          Barak J. summarized the question of the legal-causal connection applied in the Compensation Law as follows:

         

"...the foreseeability tests looks at the conduct, as it could have been seen in advance, while the Compensation Law looks upon the conduct, as it appears after the fact. In these circumstances, generally, it is not mete to have recourse to the causal test of foreseeability, where the basis of the liability is absolute liability...

 

These considerations for rejecting the foreseeability test as an appropriate causal-legal test point, in my opinion, to the risk test as the proper causal-legal test. This test holds that the required causal-legal connection exists 'if the injurious result is within the scope of the risk that the tortfeasor's conduct created, even if the injurious result was caused by the intervention of a foreign cause' (CA 576/81, at p. 7). According to the risk test 'the question is what risk did the legislature seek to prevent, and once the 'scope of risk' has been established, every harmful consequence which falls within this zone satisfies the required legal-causal connection' (CA 145/80, at p. 146). 'The question this test asks is whether a particular process of causing injury is within the zone of risks for which the Law provides a remedy' (Gilad, in the above article, at p. 30). When we apply this test in the setting of the Compensation Law, it was said that the use of a vehicle is a substantial cause of bodily injury if the injury is within the scope of the risk (both primary and secondary) which the use of the vehicle creates and for which the legislature sought to provide compensation. In my opinion, this is the principal test that arises from the interpretation of the Compensation Law:

 

'This test fulfills the legislature's aim. It has appropriate flexibility and it is suitable to the nature of the liability... which is liability without fault...' (CA 804/80, at p. 439)".

 

            This is also the answer to the question before us: the legal-causal connection also embraces mental injury to a first-degree relative of the person directly injured in the accident itself. The injury to the relative is a risk which should be taken into account. It is within the scope of the risk created by the tortfeasor's conduct. Professor Englard expressed the same opinion in his book referred to above (2nd ed. 1990), at page 59:

           

"In our opinion, the preferred approach in this matter is that which expands liability under the Law up to the limits of liability for the tort of negligence. Formally, the risk test adopted in the Shulman case tends toward expanding the right to a remedy. According to this test, the exact process of causing damage is not important; the kind of general risk is the important factor. It would appear that a mental shock at the site of the accident is not different in essence from one that occurs a bit more removed. Both come within the zone of risk which accompanies the use of a motor vehicle. From a substantive point of view, as well, narrowing recovery appears unjustified. It would require splitting the actions when grounds exist for liability in tort: the primary victims would claim under the Compensation Law while the indirect victims would claim under the Civil Wrongs Ordinance. The simultaneous administration of two compensation systems would complicate orderly litigation unnecessarily. This stands out particularly in light of the fact that one insurance policy covers both cases. For all these reasons, one should coordinate between the rule applicable to mental shock under the Compensation Law and that applicable in the tort of negligence".

 

            I am, therefore, of the opinion that mental injury to a relative comes within the scope of the Compensation Law. The tests will be the same as those set forth in great detail above, in our discussion of liability in tort.

           

            It should be added in this context that, based on the principle of unification of causes of action, anyone who has a cause of action because of a "road accident" within the meaning of the Compensation Law, may not sue for compensation for bodily damage under the Civil Wrongs Ordinance (section 18(a) of the Compensation Law). But the provisions of the Civil Wrongs Ordinance will apply in all cases in which the injury does not occur in a "road accident", as defined in the Compensation Law (for example, damage because of a child drowning in a swimming pool or similar tragedies).

           

            23. In the light of what has been said above, the cases before us should be returned to the courts of first instance to allow amendment of the statements of claim and for reexamination in accordance with the guidelines set forth at the end of paragraph 22 of this judgment.

           

            24. To sum up, the appeal in LCA 444/87 is dismissed.

           

            LCA 452/87 and CA 80/88 should be returned to the District Court or to the Magistrate Court, whichever is appropriate, for further proceedings in accordance with the guidelines detailed above.

           

            The applicants in LCA 444/87 and the respondents in CA 80/88 will pay costs in the amount of NIS 5000 to each of the opposing sides.

            Justices A. Barak and D. Levin concur.

            Decided as stated in the president's Opinion.

            Judgment given on 30.7.90.