Colin Kent Motorcycle Tech Pty Ltd (Kent) operates a motor cycle servicing business in the western suburbs of Perth. Kent regularly arranges appropriate maintenance and performance upgrades to customer motor cycles. Kent is very safety conscious and does not wish to expose his employees or customers to unnecessary risk. The technicians employed by Kent have all worked at the Kent workshop for a considerable amount of time and are valued and very competent. At the workshop, Kent has recently installed a sophisticated carbon fibre repair machine (CFRM) that can identify cracks in expensive carbon fibre components as well as perform strong and near invisible repair of carbon fibre frames, wheels and other items. The machine is housed in a purpose built fireproof room within the workshop. One day, a technician was operating the CFRM while performing a crack testing procedure to a carbon fibre motorcycle wheel. Unfortunately, when the technician had finished work for the day he left without switching off the CFRM. Switching off machinery after use is a safety requirement that he normally completes. Just after midnight, a fire began in the fireproof room which spread to the office and showroom. Investigation by the Fire and Emergency Services have revealed that overheating of the CFRM caused the fire which, would have been contained in the fireproof room except that the fire proof door had been left open which resulted in extensive damage to the workshop, office, showroom and customer motorcycles. The workshop and office were deemed too dangerous to repair and will need to be demolished. Unfortunately, in addition to engulfing the Kent premises, the fire spread to a neighbouring mechanical engineering workshop owned by Gordon Strood (Strood). This resulted in extensive damage to his front office, workshop and a company vehicle which was parked inside the premises. Fire and Emergency Services commented at the scene that some empty drums of fuel left outside the Strood workshop were potentially unsafe as they may have contained some residue fuel and were in the path of the fire. Sadly, due to a downturn in trade, Strood was not insured at the time of the incident and wishes to take civil action for compensation against Kent. He seeks damages to the value of $755000 for damage and on-costs caused. This amount includes an additional expense as Strood was unable to act as chief technician for a local motorsport team who had engaged him for a stand-alone event in Singapore. This event would have earned Strood $18000 over a weekend not including his air fare and expenses which were to be paid for by the motorsport team

Question 1. Using the 4 step process explain what liability (if any) Colin Kent Motorcycle Tech Pty Ltd has to Gordon Strood in the common law Tort of Negligence as a result of the incident. 35 marks.

Question 2. Using the 4 step process discuss whether Colin Kent Motorcycle Tech has any common law defence to Gordon Strood's action (assuming Gordon Strood is successful in proving negligence against Colin Kent Motorcycle Tech). 15 marks.