No Duty Owed By Government Authority

In Doyle’s Farm Produce Pty Ltd atf Claredale Family Trust v Murray-Darling Basin Authority 2026 NSWSC 1036, the Supreme Court of New South Wales dismissed a $1.5 billion class action by 28,000 irrigators, holding that the Murray-Darling Basin Authority owed no duty of care to individual water users.

The irrigators alleged that the Authority’s management of the Basin Plan between 2017 and 2019 caused reduced water allocations, lost profits, and higher temporary water prices.

The decision illustrates several core principles about negligence liability for public authorities.

Where a body is empowered to act in the “public interest” across competing groups, Courts are reluctant to impose a duty of care to particular individuals. Such a duty risks distorting the authority’s neutral, system‑wide role

Claims for pure economic loss require a close and direct relationship, known in the law as proximity between the defendant and plaintiff. Here, the Authority did not control individual water allocations and this diluted any finding of proximity to specific irrigators

Imposing a duty to one class of users for example irrigators, may create conflicting obligations to other stakeholders including the environment, other regions, and downstream users. Courts treat such complicated policy-laden decisions as unsuitable for negligence liability.

The Court found that even if a duty were assumed, there was no breach of that duty by the Authority in its use of climate information, planning, or delegation arrangements.

This case reinforces that Government authorities making broad, multi‑factorial resource‑management decisions are generally not liable in negligence to individuals for economic losses arising from those decisions, absent a clear, direct relationship and statutory basis for a duty.