Australia: Adeels Palace Pty Ltd v Moubarak: High Court of Australia reigns in the scope of ‘Duty of Care’
Licensees’ duty of care to patrons

Having recently ruled that a Tasmanian publican was not liable for failing to prevent an inebriated patron from riding his motorcycle home, the High Court of Australia (HCA) has handed down its decision in Adeels Palace Pty Ltd v Moubarak; Adeels Palace Pty Ltd v Bou Najem [2009] HCA 48 (Adeels).

In Adeels the HCA considered the NSW Court of Appeal (NSWCA) decision that held the duty of care owed by a proprietor of licensed premises to protect its patrons from the tortious or criminal conduct of a fellow patron can extend to taking reasonable care to guard against injury from the behaviour (including criminal behaviour) of other patrons.

The HCA found that although a licensed premises has obligations to patrons pursuant to the Liquor Act 1982 (NSW), it remains sound law that, the liability of licensees will depend on a plaintiff establishing that the licensee ought to have known of facts requiring a direct intervening act, which would have safeguarded the injured person from a foreseeable risk of harm.

Background

The defendant was Adeels Palace Pty Ltd, a restaurant located in Punchbowl, NSW. On New Years Eve 2002-2003, Adeels Palace played host to a function attended by members of the public. An admission fee was charged.

In the early hours of 1 January 2003 a dispute on the dance floor erupted and came to involve a fight between the plaintiff, Mr Moubarak, and a fellow patron, Mr Abbas. Mr Abbas left the premises and, after a short while, re-entered with a gun and shot Mr Moubarak and Mr Bou Najem, another patron.

The plaintiffs brought proceedings against the defendant in the District Court of NSW, claiming damages for negligence, for breach of contract and also a breach of the Trade Practices Act 1974 (Cth). The trial judge held that the duty of care was breached because the defendant failed to employ security staff at the time of the function and thus breached the duty. The trial judge also found that this inadequacy in security arrangements contributed and ultimately caused the plaintiffs to be shot, resulting in injuries.

The defendant appealed to the NSWCA arguing that it did not owe a duty of care in relation the criminal conduct of third parties, in accordance with the principles in Modbury Triangle Shopping Centre Pty Ltd v Anzil [2000] HCA 61. The NSWCA disagreed, holding that the defendant failed to provide reasonable protection against intoxicated, unruly or violent patrons who were served alcohol.

Giles JA held that the defendant was in a position to determine who entered and exited the premises and that this process could have been overseen by security personnel. He explained that it was not the defendant's status as occupier that gave rise to the duty to protect the patrons, but rather, the duty arose from the foreseeability that unruly conduct resulting in injury, could occur on the premises. His Honour further held that on the balance of probabilities, security staff monitoring the entrance/exit of the restaurant would have deterred or prevented Mr Abbas from re-entering the premises and ultimately shooting the plaintiffs.

Appeal to the HCA

In considering the issues of this case, the HCA referred to the Civil Liability Act 2002 (NSW) and the Liquor Act 1982 (NSW) and concluded that the evidence at trial did not show that the presence of security personnel would have definitively deterred the re-entry of the gunman. Consequently, the HCA determined that the evidence did not show that security personnel could or would have prevented re-entry by a determined person armed with a gun and acting irrationally.

The court distinguishing Home Office v Dorset Yacht Co Ltd [1970] 2 All ER 294 and Stansbie v Troman [1948] 1 All ER 599 observed that, unlike in those cases, Adeels was not a case where the evidence demonstrated that the taking of reasonable care would probably have prevented the occurrence of injury to the plaintiffs. In Adeels, the taking of reasonable care would not likely have had an (adverse) effect on the irrationality of the criminal gunman.

The HCA observed:

Of course there is always a risk that there will be some altercation between patrons at almost any kind of event. And the risk of that happening is higher if the patrons are consuming alcohol.

The HCA went on to find:

... But unless the risk to be foreseen was a risk of a kind that called for, as a matter of reasonable precaution, the presence or physical authority of bouncers or crowd controllers to deal with it safely, failure to provide security of that kind would not be a breach of the relevant duty of care.

The taking of reasonable care is to be considered for foreseeable possibilities and it was alleged at trial that Adeels Palace had a history of some violent occurrences. However, whether any, and how many, security personnel should have been provided to satisfy the duty of Adeels Palace to take reasonable care depended upon the considerations identified in s 5B(2) of the Civil Liability Act 2002 (NSW).

Each of these questions required assessment and the HCA said that these considerations must occur prospectively and not with the wisdom of hindsight. That is, they were to be assessed before the function began, not by reference to what occurred that night.

The HCA concluded:

... the event which caused the plaintiffs' injuries was deliberate criminal wrongdoing, and the wrongdoing occurred despite society devoting its resources to deterring and preventing it through the work of police forces and the punishment of those offenders who are caught. That being so, it should not be accepted that negligence which was not a necessary condition of the injury that resulted from a third person's criminal wrongdoing was a cause of that injury. Accordingly, the submission that the plaintiffs' injuries in these cases were caused by the failure of Adeels Palace to take steps that might have made their occurrence less likely, should be rejected.

The effect of this finding by the HCA was that the absence of security personnel at Adeels Palace on the night the plaintiffs were shot was not a necessary condition of their being shot, and thus the "but for" test (of causation) was not satisfied (Cf. s.5D of the Civil Liability Act 2002 (NSW)).

Conclusion

The HCA's finding sees a shift towards limiting the duty of care imposed on licensed premises.

Adeels demonstrates that liability of licensees in licensed premises will depend upon establishing that they ought to have known facts requiring a direct action or intervention that would have safeguarded the injured person from a foreseeable risk of harm. The evidence must clearly show this to be so prospectively, and cannot merely be an examination of the events with the benefit of hindsight.

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This publication is provided to clients and correspondents for their information on a complimentary basis. It represents a brief summary of the law applicable as at the date of publication and should not be relied on as a definitive or complete statement of the relevant laws.