Tram Delays, Negligent Driver Pays

Metrolink Victoria Pty Ltd (Yarra Trams) was recently successful in the Victorian Court of Appeal in a matter that will shape the future application of the test of reasonable foreseeability and redefine the range of losses recoverable from tortfeasors. In the case of Metrolink Victoria Pty Ltd v Inglis [2009] VSCA 227, Yarra Trams successfully argued that losses sustained under a contractual incentive regime were recoverable from a third party who had negligently caused delays to the tram network.

Yarra Trams operates its services pursuant to a franchise agreement with the State Government. The agreement contains an incentive scheme by which Yarra Trams is financially rewarded for its close adherence to a master timetable and is penalised for deviations from it. Any delay occasioned to the tram network results in a loss to Yarra Trams under the incentive regime, either by way of a reduction in the payment it receives or an increase in the penalty it pays under the