Patricia and Oleg both work as investment brokers in the city and live in a shared house in

Toorak, Victoria. They had both been working extremely hard on a merger for weeks and
decided, that given it was Saturday night, they should go out partying for that evening to
‘blow off steam’. Oleg had spent his previous years’ bonus on a new $500,000 Ferrari
Spyder supercar but had not yet managed to get his driver’s licence. However, both Patricia
and Oleg really wanted to go out in style so Oleg suggested that Patricia would drive the car
for that evening. Patricia was a little nervous about driving such an expensive car so she
took some cocaine to make herself feel better. Oleg heard the sound of Patricia sniffing
loudly twice from her bathroom but ignored it.

At midnight, when they were both ready to go, Oleg knocked on Patricia’s door and saw
that she was dancing furiously and waving her arms around erratically despite there being
no music. This uncharacteristic behaviour made Oleg concerned about handing his prized
car over to her so he asked if she was alright. Patricia jumped up, grabbed the car keys and
screamed: “Of course I am. I am just really excited about going out with you!” Oleg noticed
that Patricia had some white powder around her nose but did not enquire further. Instead,
he said, “Well alright, let’s go and party.”

Unfortunately, Patricia had never driven a paddle gearshift like the one in the Ferrari and
she promptly lost control of the car at the first roundabout they encountered. As a result,
the car went through a fence and crashed through the front wall of an adjoining house.
Luckily, Patricia and Oleg both were wearing their seatbelts and were not injured, but Oleg’s
car was a write off. The evidence suggests that the accident would have been likely to have
occurred even if Patricia had not consumed cocaine.

The resident of the house, Daniel, was asleep in the front room when he was woken by the
sounds of the crash. He was scared to death when he found bricks and dust all around him,
with the car an inch short of his bed. In a state of panic and confusion, he feared that the
ceiling might collapse and hid under his bed. He was trapped there for 45 minutes until the
emergency services told him that it was safe to leave the house. Given the proximity of his
house to the roundabout Daniel had had several cars crash into his property in recent
months and had become terrified that one day a car would kill him in his sleep. Due to the
incident, Daniel developed post-traumatic stress disorder. He no longer felt safe in the
house and decided to move. He incurred break fees for his lease and relocation costs as a
result.

Eva, who was a friend of Patricia, arrived to tow Oleg’s destroyed car to a wreckers yard in
Dandenong. Unfortunately, Eva forgot to cover the back licence plate of the Oleg’s car.
When Eva went along a toll road, Oleg’s licence plate was photographed. Assume that the
relevant legislation states that all vehicles whose licence plates are photographed by the toll
cameras are liable to pay a toll, even if they are towed. The operator of the toll road has
after two years tracked down Oleg and is now demanding a toll and late fees be paid for
“using” their road that night without an e-tag.

The police charges Patricia with driving or being in charge of a motor vehicle while impaired
by any type of drug under section s 49(1)(ba) of the Road Safety Act 1986 (Vic). Oleg is not
charged with incitement (nor any other offence) because it cannot be established beyond
reasonable doubt that he had knowledge of Patricia’s drug driving.

Oleg’s insurance refuses to pay for the Ferrari relying on an exclusion in the insurance
contract for loss resulting from “a criminal act by a third person with the insured’s consent”.
Because of the accident, Oleg also needs to pay a steep increase in insurance premiums
when he seeks to insure his next car.

Complete all of the following tasks:

1. Advise Oleg as to his legal rights in negligence against Patricia. You should consider all
elements of the tort and any defences which might arise.
(40 marks – you should spend approximately 68 minutes writing time on this question)

2. Advise Daniel as to his legal rights in torts against Patricia. Do not consider liability for any
property damage to his house. Please feel free to cross-refer to your discussion for Task 1,
where appropriate.
(20 marks – you should spend approximately 34 minutes writing time on this question)

3. Advise Oleg whether Eva owes him a duty of care in the tort of negligence. You are not
required to discuss the remaining elements of the tort of negligence or the defences to such
tort.
(10 marks – you should spend approximately 17 minutes writing time on this question)

** END OF EXAMINATION **