Passing motorist not a "neighbour"
One of the more unusual “road accident” cases of recent times has been decided by the High Court of Australia. The case has implications for public authorities around the country; particularly those dealing with infrastructure other than roads.
On 18November 2001, Mr Napoleone Turano sustained fatal injuries when a eucalyptus tree fell onto the car that he was driving. His wife, MrsTurano and their two children were travelling in the car at the time and they were injured in the incident.
MrsTurano sued the Liverpool City Council (as the owner of the land on which the tree was standing) and Sydney Water Corporation (as having negligently contributed to the tree falling), claiming damages for physical and psychological injury and for loss of dependency.
At the initial hearing in the District Court on liability (which was determined as a separate issue) the primary judge found the Council was liable in negligence; but that Sydney Water was not liable. The finding in relation to Sydney Water was based on a finding that it did not owe a duty of care to MrsTurano.The Council appealed to the New South Wales Court of Appeal and MrsTurano cross-appealed against the dismissal of her claim against Sydney Water.
The Court of Appeal upheld the Council’s appeal and substituted a verdict for the Council. By majority, the Court of Appeal also upheld MrsTurano’s cross-appeal; finding that Sydney Water was liable to MrsTurano.
The majority found that the tree had become diseased through waterlogging, that the water came from intermittent ponding, that the ponding was due to obstruction by the water main of a pre-existing culvert outlet pit, that the outlet pit drained into the water main's trench dug into impermeable clay and thence to the tree's roots along permeable sand laid, as usual, as a bed for the water pipe.
The majority formulated the question of whether a duty of care arose as: “[W]hether it was foreseeable that, by laying the water main in sand which acted as a conduit for water, in circumstances where the water main was installed in a position that both breached the existing drainage system and obstructed the drainage of water from the culvert, that there could be an effect on the surrounding area such as might cause harm”.
Sydney Water then appealed to the High Court.
A unanimous five-member bench in the High Court accepted that a public authority could be subject to a general duty of care arising out its conducting works pursuant to a statutory power.
Sydney Water challenged the finding that it owed a duty of care on the basis that in 1981, when the water main was laid, it could have contemplated that its conduct would affect persons driving near the main in 2001. As a result, the incident was not reasonably foreseeable.
The Court noted that the concept of reasonable foreseeability of the “class of injury” was relevant at three related stages of analysing liability in negligence: duty of care, breach of duty, and remoteness of damage.
For a duty of care to exist, the precise sequence of events leading to the incident did not have to be foreseen; but it was necessary to show that in 1981 it was foreseeable that laying a water main in a bed of sand in that location involved a risk of injury to road users. There was no evidence here that it was foreseeable.
The way the Court of Appeal had approached the matter was effectively to impose a strict duty requiring that Sydney Water preserve the existing drainage in the vicinity of its installation in order to prevent a foreseeable risk of shortening the life of surrounding vegetation — not a duty requiring the appellant to take reasonable care to avoid injury to road users in carrying out its works. It was a formulation derived by “reasoning backwards” from the events that occurred; and made a finding of breach of duty inevitable. This was impermissible.
The laying of the water main did not create an immediate risk of harm to road users. The length of time between Sydney Water’s conduct and the accident was relevant to deciding whether the relationship between Sydney Water and Mr & Mrs Turano gave rise to a duty of care.
Although Sydney Water had the power to inspect the main after it had been laid, there was no occasion for it to do so, as there had been no report about the operation of the water main in that time.
Mrs Turano argued that Sydney Water was liable for having created a “hidden danger”. The High Court however found that real cause of the incident – namely the presence of the pathogen in the tree’s root system – was not readily observable; and that mere presence did not provide justification for holding Sydney Water liable after an interval of 20 years.
As a result, Sydney Water did not owe a duty of care to Mrs Turano. That was because the consequences of its actions in 1981 were not reasonably foreseeable; and because Mrs Turano was not a “neighbour” within the well-known principle in Donoghue v Stevenson.
Sydney Water Corporation v Turano [2009] HCA 42
Dangerous recreational activity at a wine show?
The course of tort law reform rarely runs smoothly. Attempts to legislate for so-called “common sense” outcomes sometimes result in highly improbable arguments being run, as a recent case from NSW illustrates.
On 1 July 2005, Mr Perrett, who operated a recruitment agency for the wine industry, went to the Convention Centre at Darling Harbour during the Good Food and Wine Festival. He went there to interview a potential recruit. Having met the person, he was then leaving the centre when he fell down three steps in the foyer, sustaining injuries.
He sued Sydney Harbour Foreshore Authority as the owner and occupier of the Convention Centre and Darling Harbour Convention and Exhibition Pty Limited as the occupier and manager of those premises. By the time of the trial, the issues between the defendants had been resolved and they had common representation.
Mr Perrett’s case was essentially that, owing to the uniform appearance of the tiled surface of the area and the absence of edging to delineate the presence of the steps, they were difficult to see when approaching from the direction from which he came, and that he did not in fact see them. He also claimed that a sign on a column at the foot of the steps required him to look up as he was walking towards the steps, contributing to his failure to see them.
In the NSW Supreme Court, Justice McCallum found that the defendants were liable in negligence as the exercise of reasonable care required them to place contrasting grip tape to delineate the steps and to reposition the sign to the car park.
The defendants however raised a highly unusual argument based on s.5L of the NSW Civil Liability Act. That section provides that a person is not liable for harm arising out of an “obvious risk” of a “dangerous recreational activity” engaged in by a person.
Although Justice McCallum had already found that the risk posed by the stairs was not “obvious”, the defence was considered nonetheless. The defendants argued that the definition of “recreational activity” included “any pursuit or activity engaged in at a place (such as a beach, park or other public open space) where people ordinarily engage in sport or in any pursuit or activity for enjoyment, relaxation or leisure”.
Even accepting that the Convention Centre was such a “place”, the defendants had to establish that Mr Perrett was engaging in an activity that involved a significant risk of physical harm.
Justice McCallum expressed doubt that attending the Convention Centre at Darling Harbour for the purpose of a work interview was capable of being characterised as a “dangerous recreational activity” within the meaning of the Act. In any case, the “dangerousness” of the activity had to be determined by reference to the activities engaged in at the relevant time. Walking through the Convention Centre from a meeting to find a car, did not amount to“dangerous recreational activity” in the relevant sense.
Perrett v Sydney Harbour Foreshore Authority [2009] NSWSC 1026
Licensees catch a break
The High Court has arguably “moved the goalposts” in alcohol liability cases with its decision in C.A.L. No 14 Pty Ltd v Motor Accidents Insurance Board. Although the leading judgment of Justices Gummow, Heydon and Crennan draws on earlier authority and established basic principles, the decision does signal something of a shift in favour of licensees in cases involving injury to patrons.
We previously discussed the Tasmanian Full Court’s decision about the case (reported as Scott v C.A.L. No 14 Pty Ltd) in our March 2009 issue. To briefly recap the facts, Shane Scott was killed when he lost control of his motorcycle and collided with a guard rail. At the time of the accident, he had a blood alcohol concentration of 0.253 (the legal limit being 0.05). Prior to the incident, Mr Scott had been drinking at the Tandara Motor Inn operated by C.A.L. Mr Kirkpatrick, the licensee, had served him six to eight drinks. Mr Scott had then requested that Mr Kirkpatrick lock the motorcycle in the storeroom, which he did. After further drinking, Mr Scott requested return of motorcycle after he had been refused further alcohol. Mr Kirkpatrick offered to ring his wife to collect him; but Mr Scott “belligerently” refused all offers of alternative transport home. Mr Kirkpatrick then returned the bike to him.
Mr Scott’s widow sued Mr Kirkpatrick and C.A.L. She was unsuccessful at trial but succeeded in her appeal to the Full Court. C.A.L. appealed to the High Court.
The five-member bench in the High Court unanimously found in favour of C.A.L. As expressed in the joint reasons, this was on the basis that the licensee did not owe any duty to Mr Scott; that if it did, that duty was not breached in the circumstances; and any breach of duty (even if it existed) had not caused Mr Scott’s death.
Aside from the actual outcome, Justices Gummow, Heydon and Crennan went to some length to discuss the general principles surrounding a licensee’s duty to patrons. The justices addressed that point via two key questions: Do publicans owe a duty to take care not to serve customers who have passed a certain point of inebriation? And do they owe a duty to take positive steps to ensure the safety of customers who have passed that point after they leave the publican's premises?
On the first question, the justices found that (outside of “exceptional cases”) licensees, while bound by important statutory duties regulating the service of alcohol and the conduct of their premises, owe no general duty of care at common law to customers which requires them to monitor and minimise the service of alcohol or to protect customers from the consequences of the alcohol they choose to consume.
To conclude otherwise would create “enormous difficulties” relating to customer autonomy and coherence with legal norms. That was because concepts like “intoxication”, “inebriation” and “drunkenness” are difficult both to define and to apply due to widely varying responses by individuals to alcohol. Steps to ascertain how “drunk” a customer is are fraught with difficulty and those that are more accurate (such as breathalysers) are “so alien to community mores in hotels and restaurants” that it would be “unthinkable that the common law of negligence could compel or sanction [their] use”.
Significantly, the justices also put greater emphasis on the individual judgment of drinkers. It was noted that the assessment of “impairment” from drinking is much easier for the drinker than it is for the outsider. It was a matter of “personal decision and individual responsibility” as to how each particular drinker dealt with the difficulties and dangers of alcohol.
They noted that to “encourage interference by publicans, nervous about liability, with the individual freedom of drinkers to choose how much to drink and at what pace is to take a very large step”. If that step was to be taken, it would be a matter for the legislature, not for the courts via the law of negligence.
The Canadian approach, which imposed liability on publicans, was rejected.
The Court however left open the question of whether publicans owed a duty of care to persons other than their customers who might be injured by reason of the intoxication of those customers. While noting that some of the arguments against imposing a duty of care towards customers may have less application where a third party was injured by the customer, the Court expressed no final view on the issue, leaving it to be determined in an appropriate future case.
C.A.L. No 14 Pty Ltd v Motor Accidents Insurance Board; C.A.L. No 14 Pty Ltd v Scott [2009] HCA 47
Causation in shooting case shot down
Another case recently discussed in these pages has also found its way to the High Court. In Adeel’s Palace v Moubarak, the High Court has clarified – at least to some extent – the requirements for establishing liability against operators of licensed premises relating to the criminal actions of patrons on those premises.
Recapping the facts, Adeel’s Palace Pty Ltd operated a “restaurant/night club” of the same name. The establishment hosted a New Years Eve function at which Mr Moubarak and Mr Bou Najeem both attended. In the early hours of 1 January 2003, what was described as “trouble” broke out on the dance floor. The “trouble” involved Mr Moubarak and another patron, Mr Abbas, and escalated into a fight between the two. After the fight was broken up, Mr Abbas left, but returned shortly after with a gun and shot Mr Moubarak and Mr Bou Najeem.
They sued Adeel’s Palace in negligence and both were successful in the District Court; a finding upheld by the NSW Court of Appeal. Adeel’s Palace appealed to the High Court.
In a unanimous judgment, a five-member bench of the High Court (consisting of Chief Justice French and Justices Gummow, Hayne, Heydon and Crennan) accepted that Adeel’s Palace owed a duty of care to “prevent injury to patrons from the violent, quarrelsome or disorderly conduct of other persons” – a duty which was consistent with the statutory obligations they owed as holders of a liquor licence.
On the question of breach, the Court reached no definite conclusion. Although criticising the way in which both the trial judge and the Court of Appeal had determined the breach issue, the Justices found it was “not profitable” to explore the issue further, given their reasoning on the key point – whether any breach of duty had caused the injuries to Mr Moubarak and Mr Bou Najem.
The High Court noted that the causation issue was governed by s.5D of the Civil Liability Act (NSW). That section differed from the common law on causation, as it required two elements to be satisfied before causation would be proved:
- that the negligence was a necessary condition of the occurrence of the harm (described as “factual causation” in the section; and equivalent to the “but for” test in the common law cases), and
- that it was appropriate for the scope of the negligent person’s liability to extend to the harm so caused (“scope of liability”).
The Court of Appeal had found that Adeel’s Palace had been negligent in not providing security staff at the entrance to the premises; as if it had done so, those staff “would have deterred or prevented [the gunman’s] re-entry, and he therefore would not have shot MrMoubarak and Mr Bou Najem.”
The High Court however pointed out that changing any of the circumstances in which the shootings occurred might have made a difference; but that did not prove factual causation. Providing security at the entrance of the restaurant might have delayed the gunman’s entry; or it might have meant that other victims were shot. The Court of Appeal’s reasoning depended on the gunman acting rationally, which on the evidence, was simply not the case. He was acting irrationally, was armed and was “bent on revenge”.
Neither MrMoubarak nor Mr Bou Najem had shown it was more probable than not that, but for the absence of security personnel (either at the door or inside the restaurant), the shootings would not have taken place. In other words, the absence of security personnel at Adeel’s Palace was not a “necessary condition” of their being shot within the meaning of s.5D.
The section also provided that in an “exceptional case” a court could consider, in accordance with established principles, whether liability should be imposed even if “factual causation” could not be established. The High Court found that this was not such an “exceptional case” and the imposition of liability in this case would not accord with “established principles”.
Since causation could not be established, the High Court ordered judgment for Adeel’s Palace.
Adeels Palace Pty Ltd v Moubarak; Adeels Palace Pty Ltd v Bou Najem [2009] HCA 48
