VentureCapital

'From blitzkrieg to blitzscaling: Assessing the impact of venture capital dynamics on military norms' by Elke Schwarz in (2025) Finance and Society comments 

 We are in the midst of a military AI bonanza. At security and defence trade fairs, artificial intelligence (AI) is presented as the inevitable and indispensable technology that will, with little doubt, determine the future of a state and its military effectiveness. Not least since Putin declared in 2017 that those who dominate in AI will ‘be the ruler of the world’ (Vincent, 2017) has military AI garnered the attention of policymakers, military strategists, and technology companies with a keen eye for an opportunity. AI not only serves a pathway towards more autonomy and lethality for weapon systems but is also seen in defence and technology circles as the key to winning any future war. For a number of years now the credo within the US defence sphere has been: ‘the only way […] to stay competitive in a new warfighting environment is to ensure that [the US] uses the most potent weapon available: technology, and more specifically software’ (Mulchandani and Shanahan, 2022: 19). This newly focused attention on AI is reflected in US military spending. Between 2022 and 2023, federal contracts for military AI have nearly tripled, with a potential increase in the value of these contracts by 1,200% (Larson et al., 2024). With defence budgets growing across the globe, the prospects for new military software-oriented startups to capture a share of an enormously lucrative market are better than ever. And where startups are active, venture capital (VC) is usually not far. 

With its recent turn towards US military business and technologies, venture capital is, in many ways, coming back full circle to its roots. Modern military innovation, Silicon Valley, and venture capital all share original DNA. Early venture capital endeavours in the 1940s were motivated by ‘investing in and inventing solutions that would help soldiers perform better in battle’ (Vardan et al., 2020). With an early concentration of technology firms in Palo Alto emerging in the 1950s, venture capital increasingly invested in this region during this time, ‘owed much to the intersection of […] direct and indirect benefits from universities, government military expenditure as a boost to high-tech, and a special legal, cultural, and physical climate’ (Nicholas, 2019: 184). Similarly, the digital landscape itself, as we know it today, has its roots in military visions and requisitions. Norbert Wiener’s innovations in communications theory were harnessed for military missile technology in the 1950s, the grandfathers of AI almost all worked on mid-century military projects, and, of course, the Internet itself began as a military project, then named ARPANET, fostered by Pentagon requirements. And for much of Silicon Valley’s early history, until the 1990s, the region’s biggest single employer was a prominent weapons company: Lockheed Missiles and Space, today known as Lockheed Martin (Gonzalez, 2024: 4). During the boom in commercial digital technologies in the 1990s and early 2000s, Silicon Valley and VCs turned their backs on defence projects and capitalised on outsized profits from the civilian use of Silicon Valley products. During this period, the defence market was considered mature and consolidated, dominated by a handful of key industry players, the so-called ‘primes’, who held a firm grip on the defence market and associated procurement processes. 

This made VC investment in the defence sector unattractive for a good three decades, not least because the gains that could be made in a government environment were no match for the extraordinary gains VCs were able to make in the commercial realm. Moreover, investing in matters of war and conflict was, for many investors, too high of a moral risk and associated with too steep of a reputational cost, with investors ‘fearful of falling foul of environmental, social, and governance rules’ (Bradshaw and Pfeifer, 2024). These animosities began to fade in the mid-2010s through the confluence of a number of likely factors: the extraordinary yields from the first cycle of technology investments in the early 2000s needed new investment opportunities, the inclusion of more and more software products for defence infrastructures normalised the dual-useFootnote 2 aspect of emerging technologies and with advances made in software and hardware innovation, Silicon Valley companies had set their eyes on ‘overturning established industry structures’ (Andreessen, 2011), and the launch of a number of innovation-focused defence programmes in the United States facilitated the forging of much closer ties between the Pentagon and Silicon Valley specifically and between defence and the world of venture capital more broadly. Emboldened by the astounding financial possibilities of software-for-defence products, the VC sector has now once more rekindled its fraternity with the defence sector, but with an inverted hierarchy. It is not the government organisations that dictate the pace and requisitions for innovation, but rather, it is the technology industry and its associated financiers that seek to ‘reengineer […] the Pentagon’s DNA for a new era’ (Smith and Ulevich, 2023). 

In recent years, the market opportunities for VC funding in this sector have accelerated, reflected in what Deputy Defence Secretary Kathleen Hicks called a ‘surge in US defence tech focused startups, scale-ups and private and venture capital’ with ‘some 2,000 deals, investing 100 billion [US] dollars since 2021’ (Hicks, 2024). From 2019 to 2022, VC money injected into military technology startups in the United States alone more than doubled (Kinder, 2023), and since 2021, the defence technology startup sector has been injected with nearly US$130 billion (MacColl, 2024). Significant actors in the VC defence space include government-affiliated organisations, like the Defence Innovation Experimental Unit (DIUx, now DIU), but also key players from the technology industry with extraordinary financial power who are hedging their bets in the defence sector – among them Eric Schmidt (formerly Google), Peter Thiel (PayPal and Palantir), and Marc Andreessen (Netscape), and their respective VC firms. There are, of course, many others. The DIU, launched in 2015 by then-Defence Secretary Ash Carter with the aim to provide funding for small military startups (Gonzalez,  2024: 3) played a crucial role in changing the defence landscape to focus much more on software products. However, it is the private VC actors who have now firmly set their eyes on shifting the defence finance ecology in their interest and who are accelerating the advancements VC financing makes in the defence space, prompting some of the defence primes to start up their own VC funds, such as Lockheed Martin Ventures and RTX Ventures (Gonzalez, 2024: 18). 

VC adheres to a different logic than other financial instruments in the defence sector. The aim for VC firms is to make extraordinary returns for investors within a 10-year window, by betting on a high-risk, high-reward strategy and they do so by investing in companies that do not yet have an established market position but have high-growth potential. VC funders often take a hands-on approach to their investees, and once VCs have identified potentially high-growth startups, they must ‘back them with every resource’ to achieve the desired success (Thiel and Masters,  2014: 86). The primary product of the defence VC strategy is not a defence technology as such, but financial returns achieved through growth (Howard,  2024: 91). In short, the VC wager is one in which existing wealth is to be multiplied through the anticipation of significant growth, invigorated by a shallow Schumpeterianism – destruction with the anticipation of creating capital gains through growth at all costs (Kenney and Zysman, 2019: 43). Anticipation is the operative term here. VC aims are firmly rooted in future-oriented expectations of possibility, which they help force into being. 

This affects the way VC firms manifest their interests in relation to both the startups and the markets. It incentivises startups to adopt a winner-takes-all mentality, which is often accompanied by overpromising and embracing risk, mistakes, and errors in the pursuit of scaling up rapidly. Moreover, in order to realise VC interests, a targeted market must align with their timelines and propositions or else be made to align if it is not already so aligned. In other words, the old ways of defence must be disrupted in order to accommodate new players with more lofty ambitions. The disruption of any market does, however, come at a cost to many of its multiple stakeholders. 

Since VCs have re-discovered the defence sector, discourses and practices about defence acquisition, defence regulation, the global threat landscape, and relevant defence technologies for future wars have begun to change. Increasingly, prominent visions for war and security come to mirror the logic and priorities of Silicon Valley industries and its products, and the defence VC sector is exerting significant influence to help shape defence in the image of Silicon Valley itself. By all accounts, this seems to bear fruit – in an event organised by Andreessen Horowitz, a prominent VC company investing in AI-enabled weapon systems, Deputy Defense Secretary Hicks conjures up one of Silicon Valley’s most iconic mottos in closing her American Dynamism keynote: ‘yes, moving fast and breaking things is necessary to win wars’ (Hicks, 2024) – the only thing that must never be broken is the law and the US Constitution. 

In this article, I argue that the logic of VC funding and its specific financial aims exerts not only a significant power in shaping the companies and the products supported through VC funding but that this logic needs a market that accommodates the fundamental parameters of VC profit making and that this move bears significant challenges for a sector that deals with matters of life and death. VC interests enact their priorities through a mix of lobbying, legislative tools, and mythmaking, which in turn moulds the defence sector to its needs. This mandate for structural and cultural change has consequences. In the context of defence, the cost of disruption is born not only by the businesses that traditionally dominate a market but by those communities and socio-political stakeholders that are affected by the military and its practices, including those caught in the crosshairs of new, VC-backed technologies. In short, I argue that the influx of VC money in the defence sector shapes both military processes and military visions and these changes, while bearing financial fruit for investors, have potentially significant impacts on matters of peace and security. There is a substantial, and growing, literature on the relationship between VC logics and digitally shaped economies and the ensuing business practices (see, e.g. Langley and Leyshon, 2017; Cooiman, 2024; Kampmann, 2024; Howard, 2024; Kenney and Zysman, 2019, among others), but, with a few exceptions (such as Gonzalez, 2024; Marshall, 2023; Brenes and Hartung,  2024), this dynamic remains underexplored in its effects on the military domain. This is what I turn my attention to here.

Critique

'Free the Market: How We Can Save Capitalism from the Capitalists' by Mark A Lemley in (2024) 76(1) Hastings Law Journal comments 

The free market works because no one person or company is making the decisions. In a competitive market, businesspeople make the wrong decisions all the time, just as central planners do. But the consequences of those decisions don’t infect the market as a whole. Businesses that guess wrong lose money or go out of business. But as long as there is a competitor out there who guesses right, the market provides people what they want. 

But it turns out that the very last thing capitalists want is a free market. Capitalism may thrive under conditions of robust market competition, but most capitalists don’t. They would much rather operate in an environment free from government restraint but also free from the discipline of a truly competitive market. 

Unfortunately, we have obliged them. At every turn, we have allowed the dominant forces in a market to erect barriers to protect themselves from being dislodged and to maximize their own profits at the expense of everyone around them. The result has been that while we have a capitalist economy, we no longer have a free market. Nearly every market sector is less competitive today than it was fifty years ago. We have centralized control over important sectors of the economy in a handful of companies. And we have given them the tools to use that control to prevent new competition, to make it hard for consumers to take advantage of what competition there is, to drive down wages, and to extract as much short-term profit as possible rather than invest in long-term productivity. Late-stage capitalism isn’t the free market run amok. It is the capture of markets by actors who have a vested interest in making sure there is no free market. And the consequences have been dire, not only for consumers, but for inequality and political stability in the U.S. and throughout the world. 

The good news is that we have the tools to reverse that process and to free the market—and many of them are legal tools. These are big problems; much bigger than the law. But many of these problems are traceable to our failure over the past forty years to enforce legal rules that regulate markets. Enforcing the antitrust laws we already have will make a good start at undoing this harm. There are also a number of other laws we can pass that can help free the market, restricting mergers, opening markets, protecting consumers from corporate efforts to block consumer access to information, and ensuring a free market for employees. And one agency—the Federal Trade Commission—has both the authority and the motivation to open markets to competition. In this paper, I discuss the ways in which capitalists have prevented market competition and how we can reverse those changes.

Pandemic

'The scientific mission and governance of an Intergovernmental Panel on Pandemics: lessons from the IPCC and IPBES' by  Colin J Carlson, Christopher H Trisos, Ben Oppenheim, Shweta Bansal, Sara E Davies, Aïda Diongue-Niang, John Kraemer, Rachel Golden-Kroner, Lawrence O Gostin,  David TS Hayman, Marion Koopmans, Torre Lavelle, Carlos das Neves,  Zoe O'Donoghue, Benjamin Roche, Matiangai V.S Sirleaf    Kayla Zamanian, Carlos Zambrana-Torrelio and Alexandra Phelan comments

Pandemics pose a global threat to human-wellbeing, justice, economies, and ecosystems, comparable in urgency and impact to other planetary crises such as climate change and biodiversity loss. The world needs a scientific synthesis and assessment body focused on pandemic risks and solutions. Now, the primary challenge is for national governments and international organizations to agree on a blueprint. Learning lessons from the Intergovernmental Panel on Climate Change (IPCC) and the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) could help them chart a course through important decisions about format, governance, operations, scientific scope and process, and the ability to recommend policies that make the world safer.

Common Law

'Why is there 'but one common law in Australia'?' by Lucas Clover Alcolea in (2025) The Australian Law Journal comments 

The High Court has repeatedly confirmed that "There is but one common law in Australia which is declared by this court as the final court of appeal" so the fact that "Different intermediate appellate courts within that hierarchy may give inconsistent rulings upon questions of common law" does not mean that "there are as many bodies of common law as there are intermediate courts of appeal" rather it merely means "that not all of these courts will have correctly applied or declared the common law." Moreover, that common law exists even before the High Court's declaration of it. However, why is that so? What is the justification for there being only one common law of Australia? And what do we mean when we say that it exists even before the High Court declares it? In order to answer these questions, we analyse two competing theories of the common law, classical common law theory, and positivist common law theory. Ultimately, we suggest that the High Court's approach is firmly entrenched in, and can only be explained by, classical common law theory although a discussion of its general validity, as such, is outwith the scope of this paper. 

Rights of Nature

'Ocean management and rights of Nature: The case of the Galapagos in Ecuador and beyond' by Dorine Eva van Norren and Chris de Blok in (2025) 173 Marine Policy comments 

The expanded protection zone of Galapagos encircling sea territories of Ecuador, Colombia, Costa Rica and Panama (CMAR) could incorporate a rights of Nature approach, whereby prosecution of trespassers becomes more likely to be successful as cross boundary ecology is recognized in the rights of Nature approach and extra territorial application facilitated with positive effects for ocean governance. In the rights of Nature doctrine, anyone can stand up for Nature regardless of personal interest. The Galapagos sharkfin cases of 2015 and 2019 based on constitutional rights of Nature legislation in Ecuador demonstrate the preventative effect. This can be a first step towards recognizing ocean rights (as a substrand of rights of Nature). There are several options for implementation in CMAR. This fits into a wider buen vivir (good living in harmony with Nature) and development approach. Closing of areas for biodiversity protection has wider ecosystem effects (as Palau demonstrated) causing multiplication of species such as sharks outside the protection zones as well. Current levels of (CMAR and general) ocean protection are highly insufficient. The national Marine Protected Areas (MPAs) are too small in number. Moreover, the areas covered by MPAs do not always have high protection levels. The majority of areas beyond national jurisdiction are thus not protected. Which countries will ratify the new ocean protection regime (BBNJ) remains to be seen. 

On June 7 2022, Ecuador, Colombia, Costa Rica, and Panama concluded an agreement for the expansion of the special protection zone of the Galapagos [32], [46]. This article argues that if the entire extended Galapagos protected zone, stretching over Ecuador, Colombia, Costa Rica and Panama, is also given a rights of Nature status, as has been done in Ecuador, better protection can be ensured. This could also give opportunities for species to recover their populations within this extremely important highway in the oceans, the Humboldt Current. The specific case of the Galapagos can be an example of how oceans can be better preserved and managed, and how rights of Nature can strengthen the Sustainable Development Goals (SDGs), specifically SDG14 on oceans. 

Since 2008 Ecuador has had a constitution based on the philosophy of Buen Vivir, Good Living - derived from the indigenous Sumak Kawsay - which is understood as living in harmony with Nature. Under the leadership of Bolivia - which also adopted a Vivir Bien constitution in 2009 - harmony with Nature also became a formal UN institution. Buen Vivir is based on the indigenous biocentric ways of living and includes participatory democracy, economic solidarity mechanisms and rights of Nature [2]. 

The constitution contains a special protection provision for the Galapagos Islands. As part of the concept of harmony with Nature, rights of Nature are also enshrined in the constitution. On this basis, numerous law cases were conducted, one of which concerns the Galapagos Islands. Due to this regime, illegal shark fishers could be convicted by the court of fishing in or around the territorial waters. Despite the special protection regime for the Galapagos, this had not been possible earlier. Territorial waters delineation was an impediment to criminal conviction. Within the rights of Nature logics, the court found that the ecosystem, and its right to exist and be restored, extends beyond this limitation. This way sharks could be protected. 

Sharks are, as a predator, a keystone species and therefore crucial to the marine ecosystem as a whole [33]. ‘Closing of areas’ for biodiversity conservation, as has been done in the Galapagos, allows local ecosystems to flourish and provide for themselves. This also positively affects the biodiversity of the surrounding areas. This is known as a spillover effect and has been documented in an experiment in Palau that protecting restricted areas has a significant impact on the adjacent regions' fishing, flora, and fauna [37]. This article will first describe Ecuador’s constitution and rights of Nature. It will then explore the sharkfin court case, then it will briefly go into the Galapagos protection schemes, and efforts to give oceans rights. It will then apply this to the extended protection zone. The second half of the article details why Galapagos and the South Pacific matters, what protection zones are in place and how effective these current approaches are. It will then conclude with why new legal and policy approaches are desirable. This article is written from the point of view of postcolonial law and combined with the social science approach of marine ecology management. Postcolonial law emerged as a response to modernist claims of truth based in reason and empirical knowledge, and shaped around neoliberal economic views of society [3], [38], [4]. In this modernist view man is above nature instead of part of it. This anthropocentric view of life is counter to the biocentric indigenous view of life. Indigenous views of life were considered backward, unscientific and stuck in metaphysics. This resulted in epistemological injustice whereby indigenous knowledge systems were dismissed and basic philosophical differences were circumvented. The modernist legal view resulted in positivist approaches (rules-based justice) moving away from (metaphysical) natural law. Postcolonial law (such as Third World Lawyers for International Law) criticized this by deconstructing western views of international law, rooted in (neo)colonial practices. The movement for Good Living, Buen Vivir and rights of Nature, amongst others, attempts to reconstruct the law based on indigenous philosophies. This is rooted in a critical realist view of the world which accepts reality as a social construction and thus accepts possibilities of revised legal and economy theory and hence revised ocean governance. It considers law and economy as a social science (hence not factual hard science), uses interdisciplinary multilayered approaches. It looks at power as interwoven with knowledge systems and considers the epistemic injustice of subordinating indigenous knowledge systems to science. Thus it uses indigenous knowledge in its own right. Knowlton and Di Lorenzo [27] also emphasize why social sciences are increasingly important in ocean conservation, including the role of indigenous and local communities.

Police Duty Of Care

The headnote for State of New South Wales v Cullen [2024] NSWCA 310 states 

The respondent, Ms Cullen, was a bystander at an “Invasion Day” rally held in Sydney on 26 January 2017. As the rally progressed up Broadway toward Victoria Park and stopped at Buckland Street, a Mr Dunn-Velasco addressed the crowd and appeared to prepare to set fire to an Australian flag. In response, police officers from the Operational Services Group (“OSG officers”) pushed through the crowd in order to extinguish any fire. Another police officer, LSC Lowe, was videoing what occurred from a short distance away. A rallygoer next to her, Hayden Williams, struck her arm and knocked the camera to the ground. Another officer, LSC Livermore, witnessed this assault. He moved towards Williams to effect an arrest and Williams moved away. They both eventually fell down, knocking over the respondent as they did so. The respondent fell heavily and was injured. 

The respondent brought proceedings in the Supreme Court against the appellant, the State of New South Wales, claiming that her injuries were caused by the negligence of the OSG officers and of Livermore, and further alleging that Livermore had committed the torts of assault and battery. The primary judge held in favour of the respondent on the basis of negligence as regards both the OSG officers and Livermore and awarded damages. His Honour rejected the claim in battery. 

The State appealed. In response Ms Cullen filed a notice of contention. Together they raised five issues:

(1) Whether s 43A of the Civil Liability Act 2002 (NSW) applied with respect to the acts of the OSG officers or Livermore; 

(2) Whether the OSG officers owed the respondent a duty of care and, if so, whether it was breached; 

(3) Whether Livermore owed the respondent a duty of care and, if so, whether it was breached; 

(4) If a duty was owed and breached by the OSG officers, whether their actions were legally causative of Ms Cullen’s injuries; and 

(5) Whether Ms Cullen’s claim in battery should be upheld on the ground that Livermore’s arrest of Williams was not “utterly without fault”. 

The Court (per Gleeson and Kirk JJA, White JA disagreeing on the second and fourth issues and dissenting) allowed the appeal, holding: 

As to s 43A of the Civil Liability Act: 

Per Gleeson and Kirk JJA: Section 43A articulates two connecting notions between the claim made and the exercise of, or failure to exercise, a special statutory power. One requires the liability in question to be “based on” the exercise of such a power, the other refers to acts or omissions “involving” an exercise/non-exercise of it: [38]. The former can be understood as requiring that the acts or omissions said to found the civil liability in question were ones which involved, in a significant way, the exercise of a special statutory power. So understood, the two connecting notions coalesce: [39]. ... 

2. With respect to the OSG officers, per Gleeson and Kirk JJA: It is not necessary to resolve whether their impugned acts, being them rushing into the crowd and using one or more fire extinguishers on the flag, can be characterised as use of force as authorised by s 230 of the Law Enforcement (Powers and Responsibilities) Act 2002 (NSW) in exercise of a common law power to respond to an apprehended breach of the peace. Even so characterised, invocation of s 230 is not to the point as what was impugned about the actions of the OSG officers was not any use of force: [42]-[43]. Nor were the officers exercising a power to enforce the conditions of the authorisation of the march. An assembly which is not an “authorised public assembly” under Pt 4 of the Summary Offences Act 1988 (NSW) is not by that reason alone an “unlawful assembly” for the purposes of s 545C of the Crimes Act 1900 (NSW): [44]. In any case anyone can do the actions here impugned without specific statutory authority. Section 43A thus did not apply, and the primary judge erred in finding to the contrary: [46]. ... 

Per White JA: The OSG officers were exercising a statutory power to prevent a breach of the peace, but it was not a special statutory power as a member of the public has the same right to intervene to prevent a breach of the peace: [218]-[219]. ... 

With respect to the actions of Livermore, per Gleeson and Kirk JJA: Livermore’s forceful arrest of Williams, subject to consideration of common law powers of arrest, was in exercise of a power that generally requires specific statutory authority: [48]. Williams was not arrested because of any apprehension or actual breach of the peace, but because of the criminal assault of Lowe that had just occurred: [50]. The offence of assaulting a police officer while in the execution of the officer’s duty, without causing actual bodily harm, is a “serious indictable offence” under the Crimes Act and can be characterised as a felony, for which an ordinary member of the public is authorised to arrest Williams under the common law. Section 43A therefore did not apply: [53]. ... 

Per White JA: Williams’ assault on Lowe was unquestionably a breach of the peace and a member of the public would have had the power to use reasonable force to arrest Williams: [219], [221]. 

As to duty and breach with respect to the OSG officers: 

Per Gleeson and Kirk JJA: The primary judge erred in identifying the relevant risk of harm in regard to the conduct of the OSG officers in the way he did. As to the scope of a duty of care, the issues of to whom was it owed and what risk of harm needs reasonable steps taken to avoid are linked: [68]. The duty of care owed by the OSG officers should be stated as a duty to take reasonable care to avoid the risk of the OSG officers’ actions inflicting physical injury on persons in the immediate vicinity of an operational response during the protest march: [72], [79]. ... 

As to breach, the primary judge failed to have regard to the obligations of OSG officers to take action to prevent breaches of the peace, even in crowded situations: [81]. The precautions which his Honour suggested the OSG officers should have taken were impractical and ignored the conflicting obligations of the OSG officers to prevent breaches of the peace even in crowded situations: [82]. His Honour failed to consider various concessions concerning the OSG officers’ conduct which Mr Halpin, a witness of the respondent, made in cross-examination: [85]. The finding of breach of duty by the OSG officers must be set aside, and that is so even if the risk of harm was as articulated by either the primary judge or the respondent: [88]. 

Per White JA, dissenting: Whilst the OSG officers were exercising a statutory power to keep the peace, this does not negate the existence of a duty of care. The fact that the officers were exercising statutory power does not mean that a common law duty of care only arises if the statute affirmatively indicates an intention that such a duty exists: [177]-[180]. Bystanders at the rally were vulnerable to the risk of injury if the police provoked violence. As the OSG officers had caused the mêlée that led to the respondent’s injury, they had used their powers to intervene in a field of activity that increased the risk of harm to bystanders: [182]. No authorities cited by the appellant suggested that a duty of care would be negated on the facts of this case: [183]-[197]. The OSG officers’ duty to prevent a breach of the peace and a duty to take reasonable care for the safety of bystanders who might be affected by a breach of the peace were congruent: [199]. ... 

The actions of the OSG officers were calculated to inflame the situation and create a mêlée as happened. They therefore breached their duty of care to the bystanders: [226]. 

As to duty and breach with respect to Livermore: 

Per Gleeson and Kirk JJA: It is sufficient for the purposes of this appeal to accept (without deciding) that Livermore owed a duty to take reasonable care to avoid the risk of inflicting physical injury on persons in the immediate vicinity of the arrest of another person: [91]. 

Per White JA, Gleeson and Kirk JJA agreeing as to the finding of no breach: Whilst Livermore did not owe a duty of care to Williams, he did owe a duty of care to bystanders: [201], [212]. The evaluation of police conduct in effecting an arrest must be conducted by reference to the pressure of events and the agony of the moment, rather than hindsight. As Williams would have escaped had an arrest not been effected, and it was not reasonable to simply ask the rallygoer to halt, it was reasonable to effect the arrest by tackling the rallygoer. Livermore therefore did not breach the duty of care owed: [209]-[212], [230]. ... 

As to causation: 

Per Gleeson and Kirk JJA: Section 5D(1)(b) of the Civil Liability Act provides that a determination that negligence caused particular harm requires not only that factual causation is made out but that it falls within the legal scope of liability. That is a legal, normative question: [94]. A decision by a person who was outside the relevant crowd to commit a criminal assault in order to impede the gathering of evidence of possible offences was not the “very kind of thing” likely to be sparked by the officers’ actions: [103]. Williams’ actions (leading to the respondent’s injury) cannot be characterised as occurring in the ordinary course of things which might flow from the actions of the OSG officers, taking account of the independent, free, deliberate choice made by Williams at a place materially distant from the melee catalysed by the action of the officers: [105]. The issue is one of fact and degree in all the circumstances: [95], [105] and [108]. It was the distinct, significant criminal action of Williams that led to Livermore undertaking the arrest. And it was the difficulty of effecting that lawful arrest which led to the respondent being injured. For legal purposes the chain of causation from their actions to her injuries was broken: [109]. ... 

Per White JA, dissenting: The police foresaw the risk that sudden and unexpected movements of participants in the rally arising from police intervention could result in officers being assaulted or hindered, and such a situation could clearly also result in injury to participants in the rally: [242]-[243]. It is enough that the incident leading to Ms Cullen’s injury was of a kind or class which might normally be foreseen or contemplated. The voluntary and unlawful actions of Williams and the resulting forceful arrest were a natural, probable and reasonably foreseeable consequence of the OSG officers’ actions. The chain of causation was therefore not broken by the unlawful actions of Williams, and the negligence of the OSG officers was causative of the respondent’s injuries: [245]-[247]. 

As to battery: 

The State could avoid liability for battery if Livermore acted without negligence, in the sense of being “utterly without fault”, in colliding with the respondent: [112] (per Gleeson and Kirk JJA), [237] (per White JA). Brereton JA in State of New South Wales v Ouhammi (2019) 101 NSWLR 160; [2019] NSWCA 225 stated the relevant standard as requiring that the defendant show that it could not possibly have prevented the impact by exercise of ordinary care and caution. Basten JA and Simpson AJA adopted a less demanding standard. If that lower standard was applied here then the claim in battery would fail on the basis that Livermore’s conduct did not breach any duty of care: [112]-[113] (per Gleeson and Kirk JJA). Assuming (without deciding) that the more demanding standard applied, where Livermore was not conscious of the presence of the respondent, was seeking to get away from members of the crowd who were seeking to assist Williams escape whilst effecting the lawful arrest of Williams, and all of this happened in the course of a few seconds, he could not possibly have prevented the impact with the respondent by the exercise of ordinary care and caution. His actions were utterly without fault. The respondent’s claim in battery is not made out: [115]-[116] (per Gleeson and Kirk JJA), [237] (per White JA).

Unconscionability

Having used a similar fact pattern in teaching unconscionability and estates I was interested to see Bosschieter v Howitt [2024] NSWSC 1676. 

 In that judgment the Court states 

Margaret Norma Howitt died from Covid 19 on 24 February 2022 aged 93. After making several specific gifts, in her will of 2 March 2021 the deceased divided the substantial remaining asset of her estate, her house in the Sydney suburb Forestville, equally five ways among her four children and one of her grandchildren, the plaintiff, Justine Bosschieter. She gave the plaintiff a first testamentary right to purchase the Forestville property, provided the plaintiff paid 80% of its market value to the four children, the other major beneficiaries. 

The plaintiff did not exercise her testamentary right to purchase the Forestville property, which was sold for $2,850,000. The balance of the deceased’s estate is now held in cash. On 8 May 2023, this Court granted probate of the deceased’s estate to the defendant, David Howitt, one of Margaret Howitt’s children. 

In these proceedings the plaintiff seeks an order under Succession Act 2006, s 59 for further provision out of her grandmother’s estate. She claims she needs more than was provided to her under the deceased’s will to enable her to buy a house and to provide her with a cushion against the contingencies of life. 

On behalf of the estate, the defendant resists the plaintiff’s claim and contends that no further provision should be made for her from the estate. The defendant puts in issue whether the plaintiff qualifies as an “eligible person” under the Succession Act, whether there are factors warranting the making of an order for further provision out of the deceased’s estate, and he contends that adequate provision for the plaintiff’s proper maintenance education and advancement in life has already been made under the deceased’s will. 

The defendant also cross claims to set aside a gift the plaintiff contends that the deceased made to her approximately 3-months before her death. The deceased and the plaintiff had together attended a branch of a bank, the Commonwealth Bank of Australia (CBA), where the deceased closed a recently matured term deposit held in her name. This term deposit in the sum of $202,247.29 represented the deceased’s then lifesavings. The term deposit was transferred into the plaintiff’s name. Since then, the plaintiff has applied these funds to various objects. 

The defendant/cross-claimant contends that the transfer of the deceased term deposit was not voluntary but was the product of the plaintiff’s undue influence or unconscionable conduct. The defendant/cross-claimant seeks to have the transfer set aside and consequential orders made that these funds should be repaid to the estate. If the plaintiff/cross-defendant is otherwise successful in her claim, the defendant/cross-claimant claims that the transfer should be designated as notional estate under the Succession Act Part 3.3 and treated as satisfying the plaintiff’s claim. ...

The judgment subsequently states 

In October 2020 Justine took the deceased down to the CBA to request a new ATM card for the deceased’s account. The deceased was out of breath and in some physical distress due to her exertion and lack of oxygen by the time she got to the bank. The bank manager refused to issue card to Justine and the deceased as he was concerned about its potential misuse. Justine was not the deceased’s attorney. It appears that because of this Justine resolved to become the deceased’s attorney. 

In November 2020, the deceased appointed Justine as her enduring Attorney and as her enduring Guardian, in place of the March 2018 appointment of her four children to these roles. Shortly, thereafter she executed her final will in March 2021, which gave Justine and her children one fifth each of the Forestville property and her residuary estate. During this period the deceased was generally isolated due to the pandemic and being cared for by Justine. Her general health was declining as this section of these reasons finds. 

On 10 March 2021 the deceased obtained a medical certificate from her doctor regarding her inability to go to the bank. The doctor said that she suffered “from an end-stage medical condition” and that “she is housebound, frail, and susceptible to infections. She is not able to attend any community appointments including banks and shops.” This medical certificate raises real questions as to why Justine needed to take the deceased to the CBA in November that year. ... 

On 17 November 2021, during Covid-19 restrictions, Justine and Luke drove the deceased with her oxygen tank, to the CBA branch at Frenchs Forest. Whilst at the CBA, the deceased and Justine attended on Mr Nickson Adamson a bank manager with the CBA. 

Mr Adamson was not called to give evidence. During their attendance on Mr Adamson, the deceased caused the sum of $202,247.29 from a matured term deposit account in her name to be transferred into her personal account. Then shortly afterwards the deceased caused the funds to be transferred from her personal account into a term deposit account in Justine’s name. ...

The Court states that it 

does not accept Justine’s evidence that the deceased spontaneously wanted her to have the $200,000. Justine has not provided any written evidence supporting her contention that the deceased intended for her to have the term deposit funds. The deceased did not act on the independent advice of Ms Ghadirian-Marnani when she transferred the term deposit funds to Justine. From the evidence available, it is apparent that the deceased had considered gifting Justine the term deposit but not including her in the will, but ultimately decided against that course. 

However, it is now Justine’s case that the deceased’s intention was for to receive the term deposit and her entitlement under the will. The Court does not accept the deceased freely intended that course. 

Moreover, it was clear that at the time the term deposit funds were transferred to Justine from the deceased in November 2021, that there was a strong relationship of trust and confidence between Justine and the deceased. Justine was not only the deceased’s carer, but the deceased had appointed her as her enduring guardian and attorney. Appointment to these positions is only explicable based on the deceased reposing a high degree of trust, confidence and dependence upon Justine to act in her best interests. ... 

Justine commenced these proceedings on 9 February 2023. Her supporting affidavit foreshadowed the case made on her behalf. Justine seeks further provision from the deceased’s estate so she could buy her own home, by a good quality second-hand car top up her savings account with the contingency for future unplanned expenses of $250,000 and top up her superannuation in the sum of $150,000 and provide a fund for future medical expenses of $100,000. 

Probate of the deceased’s will was granted to David on 8 May 2023. Between June and August 2023, he made attempts were made to ascertain from Justine whether she would seek to exercise her right of first refusal to purchase the property. The estate’s solicitors took steps to realise the Forestville property. Justine resisted these steps adding unnecessarily to the cost of administering the estate the administration of the estate. Justine did not reply to letters from the estate of 13 April 2022, 24 October 2022, 24 November 2022 and 19 April 2023. No reasonable excuse was offered by Justine for ignoring the estate’s correspondence inquiring when she would be vacating the Forestville property. 

On 26 May 2023, the estate filed its Cross Claim seeking repayment of the November 2021 $200,000 transfer to Justine on the basis that Justine procured the transfer by undue influence and/or unconscionable conduct. Alternatively, should the transfer be found to be a valid act of the deceased, the estate seeks that the transfer ought to satisfy any entitlements to further provision from the estate which Justine is found to have. ... 

Equity students will note the discussion of unconscionability - 

The Cross Claim contends that the transfer was procured by presumed or actual undue influence that Justine had over the deceased and/or Justine’s alleged unconscionable conduct. The presumed undue influence is alleged to have arisen out of the circumstances of the relationship between Justine and the deceased and the ascendancy and dominance Justine had over the deceased. 

Unconscionable Conduct. 

The applicable legal principles in relation to the estate’s claim of unconscionable conduct may be shortly stated. The elements required for a court to conclude that unconscionable conduct has occurred were extracted in summary form from Commercial Bank of Australia Ltd v Amadio [1983] HCA 14; (1983) 151 CLR 447 at 461-462 and other cases decided in the High Court and restated in Thorne v Kennedy (2017) 263 CLR 85; [2017] HCA 49, at [38] (Kiefel CJ, Bell, Gageler, Keane and Edelman JJ) as follows (omitting case references):

“A conclusion of unconscionable conduct requires the innocent party to be subject to a special disadvantage "which seriously affects the ability of the innocent party to make a judgment as to [the innocent party's] own best interests". The other party must also unconscientiously take advantage of that special disadvantage. This has been variously described as requiring "victimisation", "unconscientious conduct", or "exploitation". Before there can be a finding of unconscientious taking of advantage, it is also generally necessary that the other party knew or ought to have known of the existence and effect of the special disadvantage.”

More recently the necessary elements of unconscionable conduct were summarised in Nitopi v Nitopi (2022) 109 NSWLR 390; [2022] NSWCA 162 at [147] (per Ward P, with whom Bell CJ and White JA agreed):

“What is clear is that, once the requisite elements of a special disadvantage, knowledge of that special disadvantage and improvidence of the transaction are established, there is at least an evidentiary onus on the stronger party to show that the transaction was fair, just and reasonable or it may more readily be concluded that the improvident transaction was procured by the unconscientious taking of advantage of that special disadvantage.”

Other general statements of legal principle should be noted. Unconscionability is a concept that is applied with considerable restraint, going beyond what is 'fair' or 'just' to circumstances which are highly unethical: Attorney General (NSW) v World Best Holdings Ltd (2005) 63 NSWLR 557; [2005] NSWCA 261, at [120] – [121] per Spigelman CJ. 

There are many statements to similar effect. One such comprehensive statement is that of Allsop P (with whom Bathurst CJ and Campbell JA agreed) in Tonto Home Loans Australia Pty Ltd v Tavares; FirstMac Ltd v Di Benedetto; FirstMac Ltd v O’Donnell (2011) 15 BPR 29,699; [2011] NSWCA 389 at [291], which also discusses how the concept of unfairness and unconscionability under the CRA may be differentiated from unconscionability at general law:

“Aspects of the content of the word "unconscionable" include the following: the conduct must demonstrate a high level of moral obloquy on the part of the person said to have acted unconscionably: Attorney General of New South Wales v World Best Holdings Ltd [2005] NSWCA 261; 63 NSWLR 557 at 583 [121]; the conduct must be irreconcilable with what is right or reasonable: Australian Securities and Investments Commission v National Exchange Pty Ltd [2005] FCAFC 226; 148 FCR 132 at 140 [30]; Australian Competition and Consumer Commission v Samton Holdings Pty Ltd [2002] FCA 62; 117 FCR 301 at 316-317 [44]; Qantas Airways Ltd v Cameron [1996] FCA 1483; (1996) 66 FCR 246 at 262; factors similar to those that are relevant to the [Contracts Review Act] are relevant: Spina v Permanent Custodians Ltd [2009] NSWCA 206 at [124]; the concept of unconscionable in this context is wider than the general law and the provisions are intended to build on and not be constrained by cases at general law and equity: National Exchange at 140 [30]; the statutory provisions focus on the conduct of the person said to have acted unconscionably: National Exchange at 143 [44]. It is neither possible nor desirable to provide a comprehensive definition. The range of conduct is wide and can include bullying and thuggish behaviour, undue pressure, and unfair tactics, taking advantage of vulnerability or lack of understanding, trickery, or misleading conduct. A finding requires an examination of all the circumstances.”

Other authorities also speak to the great variety of circumstances in which equitable intervention to relieve against unconscionable conduct is available and the need for close scrutiny of the exact relationships established between the parties: Jenkyns v Public Curator (Queensland) (1953) 90 CLR 113; [1953] HCA 2 at 118-119 and Karavaz v Crown Melbourne Ltd (2013) 250 CLR 392; [2013] HCA 25 at [18] and Wu v Ling [2016] NSWCA 322 at [8] per Leeming JA. In Wu v Ling Leeming JA explained (at [7]) that one should not expect to find a bright line separating circumstances which place an impugned transaction inside or outside the reach of equitable principle. Leeming JA cited Lord Selborne’s rejection of the notion that there is an “indispensable condition of equitable relief”: Earl of Aylesford v Morris (1873) LR Ch App 484, at 491 and referring to Fullagar J’s statement in Blomley v Ryan [1956] HCA 81; (1956) 99 CLR 362, at 405, that the circumstances in which equitable relief will be granted “are a great variety and can hardly be satisfactorily classified”. 

But this also means, as Leeming JA further explained in Wu v Ling (at [8]) that the absence of proof of immoral or dishonest motives is not sufficient to preclude equitable intervention: cf Johnson v Smith [2010] NSWCA 306 at [5] and [98] – [102]; and Paciocco v Australia and New Zealand Banking Group Limited (2015) 236 FCR 199; [2015] FCAFC 50 at [305]. 

Undue Influence. 

The principles to be applied in evaluating a claim for alleged undue influence may also be shortly summarised. A claimant may seek to set aside a transaction by showing that another party had, in fact, come to occupy or assume a position of practical ascendency, power or dominion over the claimant who had taken a co-relative position of dependence or subjugation: JD Heydon, MJ Leeming and PG Turner, Meagher, Gummow & Lehane’s Equity: Doctrines & Remedies (5th ed, 2014, LexisNexis Butterworths) at paragraph 15-105. Making out a relationship of actual undue influence involves establishing a relationship involving ascendancy or influence on the part of one person over another and that other is in a position of dependence, reliance, trust, or confidence on the stronger party: PW Young, C Croft, ML Smith, On Equity (2009, Thomson Reuters) at [5.440]. Much of the Australian and English law on this subject finds its origins in the classic statements of relevant legal principle in Allcard v Skinner [1887] UKLawRpCh 151; (1887) 36 Ch D 145. 

The applicable law in relation to undue influence in Australia was comprehensively stated and applied by the High Court in Thorne v Kennedy (2017) 263 CLR 85; [2017] HCA 49 at [34] (“Thorne”) as follows (omitting citations):

“There are different ways to prove the existence of undue influence. One method of proof is by direct evidence of the circumstances of the particular transaction. That was the approach relied upon by the primary judge in this case. Another way in which undue influence can be proved is by presumption. This presumption was relied upon by Ms Thorne in this Court as an alternative. A presumption, in the sense used here, arises where common experience is that the existence of one fact means that another fact also exists. Common experience gives rise to a presumption that a transaction was not the exercise of a person's free will if (i) the person is proved to be in a particular relationship, and (ii) the transaction is one, commonly involving a "substantial benefit" to another, which cannot be explained by "ordinary motives", or "is not readily explicable by the relationship of the parties".

Although the classes are not closed, in Johnson v Buttress Latham CJ described the relationships that could give rise to the presumption as including parent and child, guardian and ward, trustee and beneficiary, solicitor and client, physician and patient, and cases of religious influence. Outside recognised categories, the presumption can also be raised by proof that the history of the particular relationship involved one party occupying a similar position of ascendency or influence, and the other a corresponding position of dependency or trust. In either case, the presumption is rebuttable by the other party proving that the particular transaction or transfer, in its particular circumstances, was nevertheless the result of the weaker party's free will. 

Thorne discussed (at [36]) whether the relationship of fiancé and fiancée should be recognised as one to which the presumption of undue influence attaches. The relationship between a granddaughter such as Justine and her grandmother, the deceased, is not one of the traditionally identified presumptive relationships of influence and is not treated as such a presumptive relationship in these reasons. Here, the method chosen to determine whether the relationship between Justine and the deceased was one of actual undue influence is to look to the direct evidence of the transaction and the relationship between the parties from the narrative of findings above. 

In Amadio, Mason J also drew a distinction (at 461) between a transaction that is sought to be set aside on the grounds of unconscionable conduct, and one that is sought to be set aside on the grounds of undue influence: 

“Although unconscionable conduct in this narrow sense bears some resemblance to the doctrine of undue influence, there is a difference between the two. In the latter the will of the innocent party is not independent and voluntary because it is overborne. In the former the will of the innocent party, even if independent and voluntary, is the result of the disadvantageous position in which he is placed and of the other party unconscientiously taking advantage of that position. 

There is no reason for thinking that the two remedies are mutually exclusive in the sense that only one of them is available in a particular situation to the exclusion of the other. Relief on the ground of unconscionable conduct will be granted when unconscientious advantage is taken of an innocent party whose will is overborne so that it is not independent and voluntary, just as it will be granted when such advantage is taken of an innocent party who, though not deprived of an independent and voluntary will, is unable to make a worthwhile judgment as to what is in his best interest.” 

Deane J also explained in Amadio (at 474) that undue influence “looks to the quality of the consent or assent of the weaker party” whereas “unconscionability looks to the conduct of the stronger party in attempting to enforce, or retain the benefit of, dealing with the person under a special disability in circumstances where it is not consistent with equity and good conscience that he should do so”. 

Recent United Kingdom legal authority has tended to simplify the remedy for undue influence. That authority states that there are two principal requirements to make out a case to establish a rebuttable presumption of undue influence – first there must be a relationship of influence, and second, the transaction must not be readily explicable on ordinary motives, such that the nature and contents of the transaction must in the context of the relationship of influence, absent evidence to the contrary, make one conclude that undue influence has been exercised: Nature Resorts Ltd v First Citizen Bank Ltd [2022] 1 WLR 2788, [2022] UKPC 10[11] – [13] and Royal Bank of Scotland plc v Etridge (No. 2) [2002] 2 AC 773; [2001] UKHL 44. The relationship of influence may be established on the facts that the gift was a result of influence expressly used by the done. But in respect of some relationships what is commonly referred to as a rebuttable legal presumption of a relationship of influence arises.