The shocking price of a failure to concede: Supreme Court of Appeal (WA) orders indemnity costs

The recent appellate decision in Oxman v Raphael Road Pty Ltd [2025] WASCA 144 stands as a reminder of the obligation of litigators to make appropriate concessions in a timely manner and to not advance untenable arguments.  

The decision concerns an appeal from a first instance District Court of WA decision of Oxman v Raphael Road Pty Ltd [2024] WADC 3 (First instance decision) where the appellant claimed damages for personal injury caused by electrical shock from the respondent for its negligence, breach of statutory duties and breach of contract.  

Read on to understand how this decision reinforces a simple but vital principle: clients require strategic case management and sound professional judgment to know when to contend — and when to concede.

Background 

On 1 October 2015, the appellant and his partner entered into a lease agreement (Lease) with the respondent for a residential house (Property). The appellant and his partner took occupation of the Property on 30 October 2015.

On 3 November 2015, the appellant received a serious electric shock while taking a shower as he reached up to adjust the chrome shower head.  The force of the electric current was such that the appellant involuntarily held the shower head, unable to let go. He was in pain and could not breathe and could feel his back arching and bending. Afterwards, the shock had caused his left arm was wrapped unnaturally around his body. 

First instance decision 

In the first instance decision, the trial judge found the shock was caused by a cracked electrical cable plugged into an external socket and tied to the hot water pipe of the external hot water system (HWS) when it contacted a pipe leading away from the HWS.  That electrical current leaked from the electrical cable to the water pipe, causing the electric shock when the appellant touched the shower head,[1] because the electrical circuit included the power socket which the HWS was connected to, and was not protected by a residual current device (RCD). 

Accepting expert opinion, the trial judge found that if an RCD had been fitted, it would have tripped when the electrical cable exceeded 30 milliamps of power, stopping or at least reducing the electric current flowing from the electrical cable to HWS and the shower head. The appellant therefore would have received a less severe electric shock (and not a prolonged electric shock resulting from involuntary grasping of the shower head). 

One of the critical issues at trial was therefore whether by regulation 14(b) of the Electricity Regulations 1947 (WA) (Regulations) and the applicable national standard (AS NZS 300:2007 Electrical Installations) (National Standards), the respondent had a statutory duty that required it to have an RCD fitted to the electrical circuit containing the HWS electrical circuit, which then created a contractual duty in the Lease, and whether it had breached these duties. 

The appellant contended that the respondent had breached breach its duties owed and was liable to it, as it had statutory and contractual obligations expressly contained in cl 21.3 of the Lease and implied in the Lease by s 42(2)(c) of the Residential Tenancies Act 1987 (WA) which it had breached by failing to comply with the Regulations and National Standards. 

The respondent’s trial counsel (not counsel in the Oxman Appeal) maintained that the Regulations did not require the HWS electrical circuit to be RCD protected and simply required there to be at least two RCDs to protect the electrical circuits at the Property (which it was established there were).

The appellant submitted that:

1. The Regulations required that RCDs protect all power point subcircuits, which included the electrical circuit containing the electrical socket connecting the HWS.  
2. The Regulations were an implied term of the Lease under section 42(2)(c) of the Residential Tenancies Act 1987 (WA) which provided that the respondent “must comply with all requirements in respect of buildings, health and safety under any written law insofar as they apply to the premises”.
3. Clause 21.3 of the Lease stipulated that the respondent, as lessor, must comply “with all laws affecting the premises including building, health and safety laws”.
4. By failing to have an RCD fitted to an electrical circuit which included the power socket to which a HWS was connected, the respondent had breached its contractual and statutory duties. 

The trial judge found that:

1. The appellant’s claim was based on the Regulations, which relevantly he held, according to the interpretation applied, required at least two RCDs be fitted.
2. It was sufficient if there were two RCDs to protect circuits at the Property.
3. In these circumstances, the HWS electrical circuit did not also need to be RCD protected and the respondent had complied with its obligations under the Regulations.  

The trial judge dismissed the appellant’s contractual claim on the basis that he had already found that the respondent had complied with reg 14 of the Regulations and held that the respondent did not breach any contractual duty owed to the appellant as there were two RCDs to protect electrical circuits at the Property.[2] 

Issues on appeal 

The appellant pressed its contractual (and statutory) breach claim and appealed the trial judge’s conclusions in this respect. However, by the time of the hearing of the appeal, the respondent had substantially changed its position and admitted that it had breached its obligations under the Regulations and the applicable National Standards. 

Specifically, on 13 June 2024, the respondent filed submissions in the appeal that:

1. Conceded that the trial judge had erred in concluding that the existence of two RCDs was sufficient to demonstrate compliance with the Regulations and the National Standards, even if this left some circuits at the premises without RCD protection.
2. But maintained that the error of the trial judge was immaterial because the appellant did not adduce positive evidence to show that a particular exception to the requirement set out in the National Standards, to have RCD protection on the electrical circuit containing the HWS, did not apply. 

However, less than one week before the appeal hearing, on 11 September 2025, the respondent was granted leave to file amended submissions that it accepted it had breached the requirements of the Regulations and the National Standards by failing to have RCD protection on the electrical circuit containing the HWS. 

Appellate decision 

The Court of Appeal found that the trial judge was led into error (as to the interpretation of the Regulations) and allowed the appeal for this reason, and also because the respondent’s final position altered so fundamentally on a critical issue between the trial and the hearing of the appeal.  By ultimately conceding that it had not complied with reg 14(b) of the Regulations, the respondent’s position meant that trial judge’s finding that there was no breach of contractual duty could no longer stand. 

The Court of Appeal made an order for costs on an indemnity basis in respect of the appeal and the trial in favour of the appellant.  In awarding the appellant indemnity costs, the Court stated that:

1. It was untenable to maintain that there was no obligation upon the respondent under the Regulations to ensure that the HWS electrical circuit was RCD protected. That conclusion was justified by the fact that the point was ultimately conceded.
2. Had the respondent correctly conceded from the outset that it was obliged by the Regulations to have placed an RCD on the HWS electrical circuit, it was likely that this case would have been resolved much sooner.
3. The respondent ought to have conceded that it had breached the requirements of the Regulations long before the trial, and the Court disapproved of the conduct of the respondent in not doing so and by making that concession at a late stage.
4. By failing to make appropriate concessions, and conceding points, earlier and prior to trial or on appeal, the respondent had exposed itself to a risk of an indemnity costs order. 

Key takeaways

The Court of Appeal’s decision to allow the appeal but also award indemnity costs to the appellant emphasises the following key points:

• The need for parties, and their legal practitioners, to not advance arguments that lack merit as there is there is an obligation upon all those involved in litigation, both as advisers and parties, to make appropriate concessions at the earliest opportunity and not to advance untenable arguments.[3]
• Delays and untenable positions not only prolong disputes, thereby increasing costs to all parties, but may put a party at significant risk of further negative financial consequences in the form of indemnity costs orders.
• Parties should take considerable care to evaluate if the splitting of issues in dispute will assist or inconvenience the court and ultimately the parties to resolve their dispute.  

The Oxman Appeal decision serves as a strong reminder to legal practitioners and their clients that litigation is not a game of attrition, but a process grounded in the timely resolution of disputes. 

This article was written by Xavier Soon, Solicitor Insurance & Risk.

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[1] First instance decision at [76-77], [143].

[2] Oxman v Raphael Road Pty Ltd [2025] WASCA 144 (Oxman Appeal) at [27-30]. 

[3] Oxman Appeal at [46].