CAL No 14 Pty Ltd t/as Tandara Motor Inn v Motor Accident Insurance Board [2009] HCA 47 and Adeels Palace Pty Ltd v Moubarak [2009] HCA 48
In two recent decisions, the High Court has set out clearly the difficulties which plaintiffs face in suing licensed premises for harm arising out of recreational alcohol consumption. Even if a plaintiff is able to demonstrate a duty of care was owed and breached, showing reasonable care would have prevented injury can be very difficult, if not impossible in some situations due to the uncertain nature of people’s reactions under the influence of alcohol.
Tandara – No duty to prevent intoxicated patron leaving on a motor cycle
Shane Scott died in a motorcycle accident caused by intoxication (blood alcohol reading 0.253). He had been drinking at the Tandara Motor Inn in Triabunna, Tasmania over an afternoon and evening. In the early evening Mr Scott, after hearing of nearby police breath testing, agreed to Tandara’s licensee putting his motorcycle in a lockable storeroom, to which the licensee retained the keys.
The licensee understood Mrs Scott would pick her husband up that evening and that they would collect the motorcycle the next day. Mr Scott later refused multiple offers of lifts home from his drinking partner’s wife, who did not discern any signs of intoxication. Even later, Mr Scott still appeared to be unaffected by his drinking.
However, after placing his head in his hands on the bar, the licensee told Mr Scott he had drunk enough and it was time to go home. He asked for Mrs Scott’s telephone number so he could call her to collect him, but Mr Scott refused to give it to him and became agitated. Even at that time, he did not appear intoxicated. He then asked the licensee for the motorcycle. Three times the licensee asked if he was fit to ride and Mr Scott answered yes each time. In riding off, he showed no signs of impairment.
Mr Scott’s wife and insurer (which made payments arising out of her husband’s death) sued Tandara’s owner and licensee, alleging breach of duty causing to Mr Scott’s death. At trial before the Tasmanian Supreme Court, the claims failed where it was found neither the owner or licensee owed a duty of care. That decision was overturned by the Full Court of the Supreme Court (a 2-1 majority), finding breach of a duty owed causing Mr Scott’s death.
In the High Court, Mrs Scott and the insurer argued the only breach of duty was the licensee’s failure to insist he call Mrs Scott to collect her husband, despite the Full Court finding additional breaches of duty (failing to delay Mr Scott from riding, refusing to hand over the motorcycle and failing to drive him home).
The High Court unanimously found no duty of care was owed by the proprietor and licensee to Mr Scott. There was no vulnerability where he was an experienced drinker and exhibited no signs of impaired judgment, the motorcycle was only stored to avoid Mr Scott being breathalysed, not to prevent him from being killed, and finding a duty would have restricted his autonomy and been inconsistent with other laws precluding the licensee from threatening or using physical force, or detaining him or his motorcycle.
Relying on Cole v South Tweed Heads Rugby League Football Club Limited (2004) 217 CLR 469, the Court emphasised that persons in the positions of the proprietor and licensee owe no general duty to customers to monitor and minimise alcohol service or protect them from the consequences of consumption, other than in exceptional circumstances.
The Court emphasised the personal decision and individual responsibility involved in drinking, difficulties in discerning levels of impairment and the need for the legislature, not Courts, to make decisions which lead to restricting drinker’s liberties. However, the Court emphasised that issues involving duties owed by publicans to third parties harmed by intoxicated customers were in a different category and could not be determined by analogy with publican’s duties to their customers.
The majority found no breach of duty (Hayne J expressed no opinion on the issue):
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the licensee had already offered to ring Mrs Scott (drawing a comparison to Cole’s case, where a duty of care was discharged by offering a patron safe transport home);
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the licensee had no means of telephoning Mrs Scott and a call would likely generate a further violent scene;
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any delaying tactics might have irritated Mr Scott and could not have lasted long;
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the licensee could not lawfully detain Mr Scott or the motorcycle; and
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there was nothing to suggest Mr Scott would submit to the licensee’s offer to drive him home.
The majority (Hayne J expressed no opinion on the issue) also found that telephoning Mrs Scott would not have prevented her husband’s death, where there was no evidence the licensee knew or could find her telephone number, it could not conclude Mr Scott would have given the licensee her number if asked again, it was uncertain whether the call would have reached Mrs Scott in time to prevent her husband riding away on his motorcycle and it could not be inferred Mrs Scott’s arrival would have prevented her husband from riding off.
Although the case arose prior to the commencement of tort law reform legislation, it is likely a similar result would have been reached, because of the consistency in reasoning with subsequent civil liability amendments.
Adeels Palace – Reasonable care unable to prevent alcohol-fuelled violence
During a New Year’s Eve party at a reception venue / restaurant, a woman accused another of brushing her hand with a lighted cigarette on the dance floor. A widespread melee erupted. After one man was hit in the face, drawing blood, he left the restaurant and returned shortly after with a gun. He shot one man (who had nothing to do with the melee) in the leg. He shot his alleged attacker in the stomach. Both the victims sued the operator of the venue, alleging breach of duty in failing to provide sufficient security. The victims succeeded in their claims at trial before the New South Wales District Court, decisions which were upheld by the Court of Appeal.
The High Court unanimously found the claim failed on causation, where the victims failed to demonstrate additional security measures would have, on the balance of probabilities, prevented their injuries.
In considering issues of duty of care and breach, the Court looked closely at the provisions of the Civil Liability Act 2002 (NSW) and Liquor Act 1982 (NSW), finding the operator owed patrons a duty to take reasonable care to prevent injury to them from violent, quarrelsome or disorderly conduct. Modbury Triangle Shopping Centre Pty Limited v Anzil (2000) 205 CLR 254, involving a finding of no duty of care owed by a shopping centre operator to a customer injured in an assault in a car park, was distinguished where that case involved alleged failure to illuminate the cark park, not to control an assailant on licensed premises.
Although the Court thought it unnecessary to determine the issue of breach as the claim failed on causation, it observed that there would be difficulties in demonstrating a need for additional security even where there was an inherent risk of an altercation at such an event. It also considered determining breach would not establish any general rule on when security should be engaged by the operators of licensed premises.
On causation, the Court found no basis to conclude additional security staff at the venue entrance would have deterred or prevented the armed assailant re-entering the venue. Later events demonstrated he was willing to use the weapon on persons who were unconnected with “his evident desire for revenge”. Consistent with cases in medical and dust diseases contexts, the Court emphasised that the fact alternative action might have prevented harm did not establish causation. Notably, the Court found that section 5D(1) of the Civil Liability Act provided that the ‘but for’ test of causation (i.e. breach as a necessary pre-condition of harm) was the test of causation unless the case was an exceptional one, which this one was not.
An allegation based on breach of an implied warranty under Section 74 of the Trade Practices Act 1974 (Cth) also failed where causation could not be established.
What do these cases show?
In Tandara and Adeel’s Palace, the High Court has issued a ‘reality check’ in claims involving licensed premises and alcohol consumption, emphasising the need to show exceptional circumstances warranting imposition of a duty of care owed to drinkers and the difficulties in proving alternative courses of action would have prevented harm where both drinkers and third parties are involved. Although alcohol was not a clear cause of violence in Adeel’s Palace, the context of the violence and subsequent harm occurring on licensed premises was a principal consideration.
The existence of a potential risk of harm in the context of licensed premises which eventuates is insufficient to ground liability. Instead, liability will normally only arise in special cases, where there was particular vulnerability on the part of a drinker, lack of any attempt to ensure safe passage home to them or a clear risk of violence harming third parties.
Another noteworthy factor was the careful consideration given in both cases to consistency between the nature of any duty owed and the relevant liquor licensing regime. Clearly, Courts will be attempting to ensure harmony between the various regulatory requirements which licensees face and steps which plaintiffs assert should have been taken.
These cases spell a warning that claims against licensed premises arising out of alcohol consumption are difficult to prove and require close consideration of the nature of operation, risk of harm involved and particular factual circumstances of each claim.
Timothy Bowen, Senior Associate and Andrew Saxton, Partner
