Alagic v Callbar Pty Ltd - [2000] NTCA 15

Alagic v Callbar Pty Ltd [2000] NTCA 15
PARTIES:ALAGIC, Esad

v
CALLBAR PTY LTD

TITLE OF COURT:  COURT OF APPEAL OF THE NORTHERN TERRITORY
JURISDICTION:  APPEAL FROM THE SUPREME COURT EXERCISING TERRITORY JURISDICTION
FILE NO:No. AP21 of 1999
DELIVERED:  8 December 2000
HEARING DATES:  12, 13 September, 27 November 2000
JUDGMENT OF:  ANGEL, THOMAS & RILEY JJ

CATCHWORDS:
Contract – hotel – dangerous premises – liability of occupier – implied warranty
of fitness of premises – liability not dependant on personal fault of occupier – hotel patron injured by ceiling tile falling on him – contractual entrant despite no charge for actual entry – inference drawn that ceiling was not in a reasonably fit and safe condition
Negligence – dangerous premises – occupier’s liability - contractual relationship
contrasted with invitor-invitee relationship – distinction between cause of action in contract and cause of action in negligence

Brannigen v Harrington (1921) 37 TLR 349, applied
Maclenan v Segar [1917] 2 KB 325, applied
Watson v George (1953) 89 CLR 409, applied
Voli v Inglewood Shire Council (1963) 110 CLR 74, discussed
Calin v Greater Union Organisation Pty Ltd (1991) 173 CLR 33, discussed
Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479, discussed
Calvert v Stollznow [1982] 1 NSWLR 175, not followed
Morawski v State Railway Authority of NSW (1988) 14 NSWLR 374,
not followed
Stannus v Graham (1994) Aust Torts Reports 81-293, not followed
Ordukaya v Hicks [2000] NSWCA 180, not followed
Drotem Pty Ltd v Manning [2000] NSWCA 320, not followed
Downunder Rick Café Pty Ltd v Roberts (1998) Aust Torts Reports 81-481,
not followed
Cosgrave v Busk (1965) 55 DLR(2^nd) 98, discussed
Cosgrave v Busk (1966) 59 DLR (2^nd) 425, discussed
Cottee v Franklins Self Serve Pty Ltd [1997] 1 QdR 469, discussed
Derbyshire Building Co Pty Ltd v Becker (1962) 107 CLR 633, discussed
Hay v Sheargold, unreported, Dunford J, Supreme Court of NSW, 19 April 1996,
approved
REPRESENTATION:
Counsel:
Appellant:Mr J B Waters QC
Respondent:  Mr T Bryant
Solicitors:
Appellant:Hunt & Hunt
Respondent:  Cridlands
Judgment category classification:           A
Judgment ID Number:  ang20011
Number of pages:  19

ang20011
IN THE COURT OF APPEAL
OF THE NORTHERN TERRITORY
OF AUSTRALIA
Alagic v Callbar Pty Ltd [2000] NTCA 15
No. AP 21 of 1999
BETWEEN:

ESAD ALAGIC
Appellant

AND:

CALLBAR PTY LTD
Respondent

CORAM:ANGEL, THOMAS & RILEY JJ

REASONS FOR JUDGMENT
(Delivered 8 December 2000)
ANGEL J:

On January 10, 1920 Ms Brannigen was sitting in a fish shop, in England, eating stewed eel, when, for reasons unexplained, a portion of the ceiling fell and injured her. She claimed damages from the owner of the fish shop on the ground of negligence and on the ground that the premises were not as safe as reasonable care and skill could make them. Her claim succeeded, see Brannigen v Harrington (1921) 37 TLR 349.

In September 1992 the present appellant was seated drinking refreshments at a table in a bar at the Don Hotel in Darwin, occupied by the respondent, when, for reasons unexplained, a portion of the ceiling fell and injured him. He also claimed damages on the ground of negligence and on the ground that the premises were not as safe as reasonable care and skill could make them. However he was not as fortunate as Ms Brannigen, for, on 27 August 1999, the Chief Justice dismissed his claim. He now appeals to this Court.
On the day in question the appellant and his companion, the witness Kantardzic, entered the respondent’s hotel. The appellant sat at a table whilst Kantardzic purchased a drink for each of them at the bar. Kantardzic after purchasing the drinks sat at the table with the appellant. While seated there, drinking, what was described in evidence as “a tile” fell from the ceiling onto the appellant’s head. Neither the appellant nor the respondent produced any evidence as to the cause of the tile falling.
The learned Chief Justice, after recording that counsel for the appellant had submitted that in the circumstances any distinction between the appellant’s causes of action in tort and contract was of no consequence, and after referring to Watson v George (1953) 89 CLR 409, Calin v Greater Union Organisation Pty Ltd (1991) 173 CLR 33 at 38, and Voli v Inglewood Shire Council (1963) 110 CLR 74, held that the respondent had impliedly warranted that the premises were as safe for the purpose the appellant was on the premises as the exercise of reasonable care could make them. This reasoning and conclusion was at first not challenged on appeal. However later, and at the very conclusion of argument in this Court, the respondent sought and was granted leave to file a notice of contention challenging the learned Chief Justice’s conclusion.
The learned Chief Justice noted that no evidence had been called by the appellant as to what the respondent did, or failed to do, which caused the tile to fall, and that no evidence had been called by the respondent to rebut any inference of negligence, were one able to be drawn. It was established that the tile fell from the ceiling. The learned Chief Justice noted that there was no evidence as to how the ceiling tiles were attached or held in place, or the period during which they were there, nor whether any event had occurred, such as a tile or tiles having previously fallen, which could give rise to a foreseeable risk of injury. The learned Chief Justice said:
“So far as is known to the Court there is no circumstance or occurrence which should have caused the defendant to reasonably foresee the risk arising from a tile falling from the ceiling”,
which I take to be a reference to reasonable foresight of the occurrence occasioning harm to the appellant. His Honour concluded:
“I am unable to find that the falling of the tile was more consistent with negligence on the part of the defendant than with any other cause. For the same reasons the plaintiff can not succeed on a cause of action based upon breach of the implied warranty”.
Earlier, the learned Chief Justice said:
“The only evidence which might have had some bearing on the issue as to how the tile came to be detached from the ceiling came from the plaintiff’s companion, who said that on the day following the event, he returned to the bar and spoke to ‘Mr Geoff’. He said that he was a customer at the hotel and that Mr Geoff was the manager. According to that evidence, Mr Geoff said to him ‘I am sorry – what happened yesterday, you know ... Electrician was working on that corner there and he don’t fix it properly.’ Just what the electrician was doing is not disclosed.
A question as to the admissibility of that piece of evidence was reserved provisionally, but the indication that there may be an objection to it was not pressed. Instead, counsel for the defendant, in his closing address, treated the evidence as being before the Court, but submitted that it was of no assistance, the bare assertion by Mr Geoff that it was the contractor’s fault did not establish liability against the defendant. As I understood that submission, it was that it had not been shown that there was reasonable foreseeability on the part of the defendant of real risk of injury to the plaintiff arising from the contractor’s work such as to cause the requisite duty of care upon the defendant.
In any event, the plaintiff did not seek to rely on that evidence. It was not pleaded that the defendant was responsible for the acts or defaults of the contractor or that it failed to discharge a duty of care to the plaintiff arising from the electrician’s attendance at the premises, or work undertaken by the electrician.
Counsel for the plaintiff indicated that his client’s claim was based upon negligence and contract. However, he submitted that in the circumstances of this case, the distinction between the two causes of action was of no consequence”.
There was no evidence as to who had engaged the electrician.
A consideration of the relevant case law leads to the conclusion, contrary to the submissions before the learned Chief Justice and his conclusion, that there is a clear distinction in law between the alleged cause of action in contract and the alleged cause of action in negligence, and that it is a distinction of significance in the present case.
This much is evident from the decision of Greer J (as he then was) in Brannigen. In that case, as in this, there was no evidence as to what caused the portion of the ceiling to fall. His Lordship found there was no personal negligence on the part of the defendant, since before the accident the ceiling showed no indication that it was about to fall, and there was no want of reasonable care on the defendant’s part in the matter of repair. His Lordship held, however, that as an accident of that kind could not happen without negligence on the part of someone, ceilings not falling if due care is taken when they are installed or repaired, there was a breach of warranty that the premises were as safe as reasonable care and skill could make them, that is, there was a proven breach of the warranty formulated by McCardie J in Maclenan v Segar [1917] 2 KB 325. Greer J held that the only question in the case was whether the principle in Maclenan applied to a restaurant and that there was no reason why the principle should not apply because Ms Brannigen had paid “not merely for the food but also for the accommodation …”.
The contractual warranty expressed by McCardie J in Maclenan (at 332-3) was in the following terms:
“Where the occupier of premises agrees for reward that a person shall have the right to enter and use them for a mutually contemplated purpose, the contract between the parties (unless it provides to the contrary) contains an implied warranty that the premises are as safe for that purpose as reasonable care and skill on the part of any one can make them. The rule is subject to the limitation that the defendant is not to be held responsible for defects which could not have been discovered by reasonable care or skill on the part of any person concerned with the construction, alteration, repair, or maintenance of the premises; and the head-note to Francis v Cockrell (1870) LR 5 QB 501, must to this extent be corrected. But subject to this limitation it matters not whether the lack of care or skill be that of the defendant or his servants, or that of an independent contractor or his servants, or whether the negligence takes place before or after the occupation by the defendant of the premises.”
That formulation was adopted by the High Court in Watson v George (1953) 89 CLR 409 at 424.
In Calin v Greater Union Organisation Pty Ltd (1991) 173 CLR 33, the High Court held that whereas in an action for negligence against an occupier it is necessary to determine only whether, in all the relevant circumstances, including the fact of the defendant’s occupation of the premises and the manner of the plaintiff’s entry upon them, the defendant owes the duty of care under the general principles of negligence without the necessity to consider whether a special duty is owed to a particular class of entrant (Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479), if an occupier of a premises agrees for reward to allow a person to enter the premises for some purpose, the occupier impliedly warrants that the premises are as safe for that purpose as the exercise of reasonable skill and care can make them (Watson v George (1953) 89 CLR 409). Both the post Zaluzna survival of Watson v George and Calin appear to have been overlooked in the recent case of Drotem Pty Ltd v Manning [2000] NSWCA 320. Cases such as Collis v Selden (1868) LR 3 CP 495 (falling chandelier in public house) and Sandys v Florence (1878) 47 LJ (CL) 598 (falling ceiling in hotel) are now of historic interest only.
In Watson v George, Fullagar J, with the concurrence of Kitto J, expressly approved the decision of McCardie J in Maclenan. It is desirable to quote Fullagar J at some length. He said (at 423-425):
“In Maclenan v Segar the plaintiff had been seriously injured in a fire which broke out in an hotel in which she was staying as a guest for reward. The cause of the fire was proved to lie in a defective scheme for conveying smoke and burning soot from the kitchen chimney. The construction had been carried out by a competent architect and a competent builder employed by the defendant’s landlord, but either the architect or the builder or both had, as McCardie J found, been guilty of grave negligence. The construction was such that there was from the first a grave risk of fire, though the risk did not in fact materialise for some six years. The defendant did not know, and had no reason to suppose, that there was any danger. McCardie J, in holding the defendant liable, began by saying that the case was not a case of an invitee. He said:
‘In my opinion the existence of a contract between the plaintiff and the defendant in such a case as that now before me is of great importance, for it may lead to the implication of a warranty which carries the duty of a defendant substantially beyond the obligation indicated in Indermaur v Dames.’
The learned judge then considered a number of authorities, and, after concluding with a citation of the passage which in effect repeats the passage set out above from the judgment of Kelly CB in Francis v Cockrell, he stated what he conceived to be the relevant rule in the following terms:
‘Where the occupier of premises agrees for reward that a person shall have the right to enter and use them for a mutually contemplated purpose, the contract between the parties (unless it provides to the contrary) contains an implied warranty that the premises are as safe for that purpose as reasonable care and skill on the part of any one can make them. The rule is subject to the limitation that the defendant is not to be held responsible for defects which could not have been discovered by reasonable care or skill on the part of any person concerned with the construction, alteration, repair, or maintenance of the premises; and the head-note to Francis v Cockrell, must to this extent be corrected. But subject to this limitation it matters not whether the lack of care or skill be that of the defendant or his servants, or that of an independent contractor or his servants, or whether the negligence takes place before or after the occupation by the defendant of the premises.’
The above statement of the rule must, I think, be accepted as a correct statement: it can hardly be doubted that it represents the general current of authority. It is, however, from some points of view, a curious rule. The obligation is, in legal theory, contractual, but the liability depends on a breach by somebody at some stage of a common-law duty (which may, of course, have been also itself a contractual duty) to use reasonable care. It seems clear that the rule does not impose liability in the absence of negligence on the part of anybody. It is to be observed also that in some cases the whole question will resolve itself practically into a question whether the defendant or a servant of the defendant has been guilty of negligence in connection with the source of danger and damage.”
As that passage makes clear the warranty is against defects in premises resultant upon personal negligence of the occupier or upon negligence of anyone else concerned with the construction, alteration, repair or maintenance of the premises, and an occupier is liable for damage caused by any such defect. It is important to emphasise that liability does not necessarily depend on personal fault of the occupier – pace Priestley JA in Stannus v Graham (1994) Australian Torts Reports 81-293.
In the present case, the learned Chief Justice posed the question whether it had been shown there was reasonable foreseeability on the part of the respondent of a risk of injury to the appellant arising from “the contractor’s” work such as to cause “the requisite duty of care upon the (respondent)”, whereas the real issue was not only whether the respondent was shown to have been negligent but whether the respondent was in breach of warranty, even if it, like the defendant in Maclenan, supra, did not know and had no reason to suppose that there was any danger, and, whether it was contractually – as opposed to vicariously – liable for any breach of a common law duty to use reasonable care on the part of the electrician.
So far as the appellant’s case in contract is concerned, the onus, of course, was upon him to prove his case. As Fullagar J said in Watson v George (at 426):
“As a matter of general principle, the burden of proving a breach of contract, no less than that of proving a breach of a common law duty, rests on a plaintiff, I think that the cases generally suggest, and that the true rule is, that the burden rests on a plaintiff in this class of case of proving negligence somewhere at some stage. It might be thought that the position should be otherwise: the occupier is the person most likely to be in possession of material facts. But it does not seem to me that the authorities warrant saying that the occupier must satisfy the court or a jury that an unsafe condition of the premises was not due to anybody’s negligence. It does not, of course, follow that a plaintiff may not in some circumstances be able to launch a case without specifying an act or omission on the part of any particular person as responsible for the defect or danger.”
It was established that a tile fell from the ceiling. It was also established that an electrician had been working in the area a short time previously. The ceiling for reasons unknown was defective. Without inferring personal negligence on the part of the respondent I am of the view that in the absence of evidence from the respondent, an inference can and ought to be drawn that the ceiling was not in a reasonably fit and safe condition and that that condition was as a consequence of some unspecified act or omission of the electrician and that the electrician’s lack of care and skill was responsible for the defect. If the rule in Maclenan applies, it matters not if the electrician was an independent contractor, or engaged or employed by the owner rather than the occupier of the hotel, cf Thomson v Cremin [1953] 2 All ER 1185 at 1191-92, per Lord Wright; Green v Fibreglass Ltd [1958] 2 QB 245 at 252-3; Voli v Inglewood Shire Council (1963) 110 CLR 74 at 97, 98.
The present case, it seems to me, the evidence about the electrician apart, is on all fours with the decision of Greer J in Brannigen. The accident was caused by some unknown defect in the static condition of the premises. The so called principle of res ipsa loquitur does not assist the appellant to prove a case against the respondent in personal negligence. There was no proven indication that the ceiling tile was about to fall and no adverse inference can be drawn against the respondent as to want of reasonable care in the matter of either installation or repair. On the other hand, as Greer J said in Brannigen, “ceilings do not fall if due care is taken when a ceiling is installed or repaired,” and an accident such as befell Ms Brannigen and the present appellant would not happen without negligence on the part of someone. The Maclenan warranty, if it applies as between the respondent and the appellant, on the meagre evidence before the Court, is proven to have been broken. Does it apply?
Brannigen was expressly disapproved by the New South Wales Court of Appeal in Calvert v Stollznow [1982] 1 NSWLR 175, where Samuels JA (Moffitt P and Hope JA concurring) held that the patron of a restaurant where no charge is made for entry is in law an invitee whilst entering and remaining in the restaurant and that the Maclenan principle did not apply. Samuels JA said (at 177):
“The essential question is whether a visitor taking a meal in a restaurant is in law an invitee (as the learned judge thought in the present case) or is a contractual entrant and thus entitled to the benefit of a somewhat higher degree of care.”
I pause to say that since Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479 and more particularly Calin v Greater Union Organisation Pty Ltd (1991) 173 CLR 33 it is both inaccurate and misleading to speak of a contractual entrant being owed a “higher degree of care”. This inaccuracy has been expressed in subsequent cases a number of times, see eg. Downunder Rock Café Pty Ltd v Roberts (1998) Australian Torts Reports 81-481 per Charles JA, Winneke P and Buchanan JA concurring. In the Maclenan formulation, post Zaluzna, the personal contractual obligation of care of the occupier is the same as in tort; the contractual liability nevertheless is broader, the occupier also being responsible for the negligence of others.

Returning to the judgment of Samuels JA in Calvert, he said (at 178):
“In my opinion, the requirement for enjoyment of the contractual duty is entry upon the premises ‘under’, that is, by dint of, a contract for valuable consideration. The entrant must have bought the right to enter the premises, although whether he pays before, upon or after entry, or whether at any of these points he merely undertakes to pay, is of no significance. The right to enter will involve in all the cases that I can think of a concomitant right to remain upon or use the premises for a mutually contemplated purpose. Hence the collocation of ‘enter’ and ‘use’ in McCardie J’s judgment. However, although it is difficult to conceive of a contract for entry which does not also involve some right to remain or use, it is quite possible to imagine a contract which confers rights to remain or use but which does not entail any right of entry.
The distinction marks the point of departure for Mr Bennett’s argument in the present case. There is no evidence, as I have said, that the appellant paid to enter the premises; or that entry was denied to all save those who made a contract for that purpose with the management. Accordingly, there was not, in the present case, any contract for valuable consideration under which the appellant entered the respondent’s restaurant. It follows that the contract for which the appellant contends must have arisen after entry, but must be accorded the same potency as a contract to enter. Mr Bennett, therefore, formulates the true test as follows:
‘Where at the relevant moment a person is on land pursuant to a right given to him by an express or implied term of the contract into which he has entered he is a ‘contractual occupant’.
I do not accept this submission as sound. It will be observed that what I take to be its deficiency is indicated by the adoption of the label ‘contractual occupant’ rather than ‘contractual entrant’. But the contract which is relevant in this case, as I have endeavoured to show, is not a contract by which the occupier permits a visitor to remain on the premises or to continue to occupy them; but rather one by which the occupier permits a visitor to enter the premises.”
Samuels JA also said this (at p179):
“This conclusion represents, I think, the generally accepted view of the duty owed to his patrons by the occupier of a restaurant. For example, Fleming, op cit, at p 440 (note 12) says: ‘ … a restaurant patron is merely an invitee, because he pays for his meal, not for admission.’ There are, however, two cases to the contrary, which Fleming mentions and counsel cited. The first, a decision of Greer J, as he then was, is Brannigen v Harrington (1921) 37 TLR 349, in which a customer in a restaurant was held entitled to the benefit of the warranty formulated in Maclenan. His Lordship found consideration for the contract in the circumstance that in a restaurant ‘one paid not merely for the food, but also for the accommodation’. I doubt the general truth of that proposition, and there appears to have been no evidence in the case to support it. I do not consider Brannigen to be good law. The second case is Cosgrave v Busk (1965) 55 DLR(2d) 98, a decision of Jessup J in the Ontario High Court. There the contractual duty was extended to the patron of a bar, who slipped on the wet floor. The learned judge cited Brannigen with approval, and there being no evidence that the plaintiff paid for his drinks, found consideration ‘in the entry on the premises for the purpose of the consumption of food or beverage’. I do not find this explanation persuasive. A person may enter a bar for the purpose of consuming drink, but change his mind before doing so. If he slips on his way in he would then, according to Cosgrave, be a contractual entrant. But what of his status on his way out, having neither drunk nor paid? Alike with Brannigen, Cosgrave overlooks the essential requirement of payment for entry, and should not be followed.”.
Calvert has been followed and referred to without criticism in a number of subsequent New South Wales cases, see eg. Morawski v State Rail Authority (1988) 14 NSWLR 374; Ewart v Scott (1986) Australian Torts Reports 80-009. In Morawski, (at 382) Clarke JA said that the real question in that case was whether the appellant had paid for entry into that part of St James Station in which she sustained her injury and that he expressed the question in that way “because the balance of authority supports the proposition that there is a distinction between the person who pays for entry into premises and a person who does not pay for entry to enter upon the premises in order to enjoy other facilities for which he pays”. After citing a number of text books on tort and negligence Clarke JA said “The important distinction which is drawn and which must be accepted by this Court since Calvert is between persons who pay for entry into the premises and those who do not”.
Contrary to the view of Samuels JA in Calvert (at 179) I am of the view that Brannigen is good law. I think it is consonant with principle and good sense. It was cited without disapproval in a substantial number of texts, over a considerable period, including Halsbury’s Laws of England, 2^nd edn (1936) Vol 23 p606 footnote(r); 3^rd edn (1959) Vol 28 pp 45-46 footnote (g); Clerk and Lindsell, The Law of Torts, 10^th edn (1947) p644 footnote (a); 11^th edn (1954) p668 footnote (p) p669 footnote (c); Charlesworth on Negligence, 3^rd edn (1956) p182 footnote (n); 4^th edn (1962) p188 footnote 54; Salmond, Law of Torts 11^th edn (1953) p554 footnote (u). So far as I have been able to ascertain the only critic of Brannigen was Professor Fleming, who asserted that a restaurant patron was an invitee “because he pays for his meal, not for admission”, see eg. Fleming on Torts 6th edn (1983) at 423 footnote 13; 7^th edn (1987) p 423 footnote 52. With all due deference, provision for and admission to the eating spot is part-consideration for the payment. With all due respect to Samuels JA, his statement that there was no evidence in Brannigen to support Greer J’s view that the plaintiff had “paid not merely for the food but also the accommodation” demonstrates a misunderstanding of what Greer J was saying. In the fish shop in that case as in the Don Hotel in Darwin in the present case no mere sale of goods transaction took place at the counter. Ms Brannigen and the present appellant were each contractually entitled to the use of the premises provided for the consumption of the meal or drink. Indeed it is commonplace under licensing legislation for it to be an offence to purchase a drink at the bar of licensed premises and consume it off the licensed premises. I say nothing of the purchase of a chocolate bar at a delicatessen for consumption elsewhere, but in the present case the use of the licensed premises was part of the consideration paid for, it was an incident of the contract, and, consonant with principle – as Greer J held in Brannigen – a Maclenan warranty applied. Had the appellant’s chair collapsed under him, injuring him, he would, I apprehend, have had a claim for breach of warranty that it was reasonably fit for its intended purpose: Derbyshire Building Co v Becker (1962) 107 CLR 633; Cottee v Franklins Self Serve Pty Ltd [1997] 1 Qd R 469. It would be anomalous for the appellant to succeed in that event but not in the present circumstances. In my view it is unnecessary, for the purposes of the present case, to discuss Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313 and in particular the application by Brennan CJ (at 338-339) of Maclenan to a landlord/tenant relationship consequent upon the abolition of the rule in Cavalier v Pope [1906] AC 428, or Jones v Bartlett [2000] HCA 56. With all due respect to Samuels JA in Calvert the rigid demarcation he adopts, or to note his expression (at p181) “the principle I propose”, appears, as he says, to lead to a conclusion that a paying customer in a hotel may be a contractual entrant to his room, but not to other parts of the premises ie. that the duty might vary according to the area of the premises where the injury was sustained, a suggestion made in Bell v Travco Hotels Ltd [1953] 1 QB 473, which was cited by counsel in Watson v George, supra. The decision in Watson v George, approving Maclenan without qualification, in my opinion put paid to any such notion. Maclenan’s case itself is authority, if authority be needed, that the warranty applies to defects in areas of the premises to which the entrant has no access, let alone access for which he has paid. Furthermore Samuels JA’s proposed principle would, unless a traveller pre-booked, ordinarily, be inapplicable to travellers who usually only make a contract at reception once already upon hotel premises. Moreover the Maclenan warranty applies to common areas within an hotel; it is not confined to a booked room: see, eg. Hay v Sheargold, (unreported) Dunford J, Supreme Court of New South Wales, delivered 18 April 1996. Samuels JA also appears to regard as anomalous any change in a person’s status whilst on the premises and the position of a person ‘on his way out, having neither drunk nor paid’. I see no anomaly in this; a contractual obligation can only arise upon entering a contract and it was commonplace under the categories of Indermaur v Dames (1866) LR 1 CP 274, that the status of a door-to-door hawker oscillated between licencee, invitee and trespasser, depending on the reception he received at the door and the route he took to leave. It is also to be noted that notwithstanding Calvert, Kirby P (as he then was) in Morawski (at 377, 378) appears to have regarded the law applicable to restaurants as an open question. For all these reasons I am, with respect, unable to accept the reasoning in Calvert or of Clarke JA (McHugh JA concurring) in Morawski or of Sheller JA (Mason P and Meagher JA concurring) in Ordukaya v Hicks [2000] NSWCA 180.
The learned Chief Justice found there was a contractual arrangement between the parties to these proceedings, applying by analogy Voli v Inglewood Shire Council, supra, where no distinction was drawn between the purchaser of a ticket and a holder of a ticket purchased by someone else; see in particular the judgment of Windeyer J at pp 93-94. The existence of some contractual arrangement between the parties was not contested on the appeal. The Ontario Court of Appeal in Cosgrave v Busk (1966) 59 DLR (2d) 425 at 426, in closely analogous circumstances (beer drinking in an hotel) found there was no evidence of a contract and reversed the decision of Jessup J (1965) 55 DLR (2d) 98, which Samuels JA criticised in Calvert. In the present case, to view the appellant’s companion Kantardzic as contracting as agent for the appellant would be, in the words of Windeyer J in Voli, supra, at 94 “to resort to … uneasy artificiality”. I think the better view is either the respondent’s Maclenan warranty is collateral to Kantardzic’s payment at the bar, or alternatively, that the respondent’s warranty is impliedly given in consideration of the appellant using the premises for the contemplated purpose, that is, a unilateral Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256 type contract: see the analysis of McPherson JA in Cottee v Franklins Self Serve Pty Ltd, supra, at 479-480. Given the way this matter has been conducted it is unnecessary to reach any concluded view on this aspect of the case. That there was consideration to support the warranty was never in issue.
I would hold, following Brannigen as good law and rejecting Calvert as bad law, that the Maclenan principle applies in the present case, that there was a contract between the appellant and the respondent containing an implied warranty that the Don Hotel premises wherein the appellant was drinking would be as safe as reasonable care and skill could make them for the appellant’s purpose and that the respondent, whilst not shown to be personally negligent, was liable because an accident of the kind that befell the appellant could not have happened without negligence on the part of someone. I also think it can be inferred that the unfit state of the ceiling was as a consequence of some unspecified act or omission of the electrician, as I have said, and that it was the electrician’s lack of care and skill which was the reason for the defect. Under the rule in Maclenan the respondent is responsible for that negligence, ie. he is responsible contractually, not vicariously, for the acts and omissions of the electrician. I would hold the respondent liable on that ground also.
The appeal should be allowed and judgment entered for the appellant.
Having dismissed the appellant’s claim, the learned Chief Justice proceeded to consider certain aspects relating to the question of damages. In doing so he discussed the evidence and made certain findings of fact adverse to the appellant. The learned Chief Justice did not quantify the appellant’s damages. Certain of his Honour’s findings of fact were the subject of grounds of appeal. In the course of the hearing of the appeal we indicated to counsel we would not entertain those grounds of appeal and that if we were of the view that the appeal on liability should be allowed that the appropriate course would be to enter judgment for the appellant for a sum to be assessed and remit the matter back to the learned Chief Justice for the assessment of damages, the appellant remaining free by way of appeal to contest such assessment and any findings of fact related thereto.
THOMAS J:
I have read the Reasons for Judgment prepared by Angel J. I agree with the Reasons for Judgment. I am in agreement that the appeal should be allowed, judgment to be entered for the appellant and with the proposed consequential orders.
RILEY J:
I agree with the orders proposed by Angel J and his reasons therefor.