Austin v Bonney

[1998] QCA 8

IN THE COURT OF APPEAL	[1998] QCA 008
SUPREME COURT OF QUEENSLAND	Appeal. No. 60 of 1995
Brisbane
[Austin v. Bonney]
BETWEEN:	DAVID ALBERT AUSTIN

(Plaintiff) Appellant

AND:

CLIVE RAYMOND BONNEY

(Defendant) Respondent

Macrossan C.J.
Thomas J.

Helman J.

Judgment delivered 12 February 1998

Separate reasons for judgment of each member of the Court; Thomas and Helman JJ. concurring as to the orders made, Macrossan C.J. dissenting.

APPEAL DISMISSED WITH COSTS.

CATCHWORDS:	CONTRACT - breach of tenancy agreement. NEGLIGENCE - duty of care - appeal in personal injuries action by appellant tenant - appellant fell down internal staircase - whether brother of landlord was agent - whether notice given to landlord in sufficient time to remedy defect.
Northern Sandblasting Pty Ltd v. Harris (1997) 188 C.L.R. 313
Counsel:	Mr R. Douglas Q.C. with Mr G.T. Britton for the applicant. Mr P.A. Keane Q.C. with Mr A.S. Mellick for the respondent.
Solicitors:	Vincent Morrin Associates for the applicant. Wallace and Wallace for the respondent.
Hearing Date:	27 November 1997

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 60 of 1995

Brisbane

Before Macrossan CJ
Thomas J
Helman J

[Austin v. Bonney]

BETWEEN:

DAVID ALBERT AUSTIN

(Plaintiff) Appellant

AND:

CLIVE RAYMOND BONNEY

(Defendant) Respondent

REASONS FOR JUDGMENT - THE CHIEF JUSTICE

Judgment delivered 12 February 1998

On 11 December 1991 the appellant who was the tenant of a flat, Unit 4, at 103 Milton Street,

Mackay fell while descending an internal staircase and as a result suffered injuries.

The judge below found that the injuries were caused by the bad state of repair and condition

of the staircase. He also found that the injuries were caused partly by the appellant’s own fault.

Because of the appellant’s earlier experiences he was aware of dangers due to the condition of the

staircase. The judge made an apportionment of negligence but since he was of the view that liability,

if any, was to be found in contract and not tort he held that the apportionment legislation would not

apply. However, he held that the claim in contract could not succeed, finding that there was no breach

of any term of the contract of letting of the premises to the appellant. Had there been such a breach the judge’s view was that the respondent would have been liable for the whole of the damage suffered

by the appellant on the basis that the apportionment legislation did not apply to claims in contract.

Damages were assessed at $50,056 and their quantum is not in issue on this appeal.

The appellant had been in occupation of the premises as tenant since about one year before he

was injured. At that time the respondent’s predecessor in title was the landlord of the premises. The

tenancy was shown to be a weekly periodic one. The rent was payable weekly but there was nothing

in writing recording other terms.

The appellant was notified by letter dated 7 November 1991 that the respondent had taken

over as landlord. The respondent’s address was given as a PO Box at Moranbah a town some

distance away from Mackay where the premises were situated. The letter informed the appellant that

the rent was to be payable as directed and the arrangement became one whereby it was paid to the

respondent’s brother by whom it was collected weekly.

The staircase responsible for the appellant’s fall and injuries had been in a state of what the

judge found to be dangerous disrepair prior to the respondent’s takeover as landlord. There was no

sufficiently clear evidence one way or the other whether the appellant had ever made complaint about

the state of repair to the previous landlord.

It was not in dispute that the Residential Tenancies Act 1975 applied to the letting. Section

7(a)(ii) was the provision of the Act of greatest relevance and it stated the obligations of the landlord

as being:

“to provide and, during the tenancy, maintain the dwelling-house in good tenantable
repair and in a condition fit for human habitation. ”

A series of decisions in the United Kingdom held that corresponding statutory provisions there resulting in a contractual term being implied in a tenancy agreement had the consequence, although it might not be immediately obvious from the words of the statutes, that a landlord would not be liable

under the implied covenant for the consequences of a state of disrepair occurring after the tenant had

entered into occupation unless the tenant had given notice of the need for repairs: Morgan v Liverpool

Corporation [1927] 2 K.B. 131, McCarrick v Liverpool Corporation [1947] A.C. 219, and O’Brien

v Robinson [1973] A.C. 912. The reasoning was that since the statutory provision applied by way of

modification of the terms of the contract between the parties, it should be held to operate in the same

way as landlords’ express covenants under which a duty to maintain premises in repair was undertaken.

As Lord Diplock observed in O’Brien v Robinson (supra) at 927 a strong argument that this was the

true intention of the statute or at least an acceptable consequence to be attributed to it was the fact that

the relevant current legislation was passed in substantially the same terms after courts’ decisions

declaring to that effect had been given. In other words, the legislature should be taken as having

intended to adopt the effect of the earlier court decisions. A tenant with possession is more directly in

touch with emerging repair needs than a landlord who has surrendered possession. This principle

adopted in the English cases applies equally strongly to the terms of the Queensland Residential

Tenancies Act and it should be accepted for our purposes as legally correct. There was no issue raised

on this aspect in argument on the appeal.

There was some variance between the way in which the present case was pleaded and the way

in which it was conducted. It is clear enough that it was framed to include a case in contract. Although

there was no allegation in the pleading that the landlord had been given notice under the statutory implied

covenant of the need for repair, the matter of notice became a live issue on the hearing and was decided

by the trial judge.

The judge held that requisite notice of the need for repair had not been given to the respondent.

He did accept that a complaint had been made about the condition of the stairs by the appellant to the

respondent’s brother, Jeff Bonney but held that Jeff Bonney had not been shown to be the respondent’s

agent for the purpose of receiving communications about the state of repair. He said the evidence

introduced on this issue “falls short” of establishing that the brother was the respondent’s agent for this

purpose but he did not persuasively explain why it should be regarded as insufficient.

Unsatisfactory though the state of the pleadings was, it should be concluded that the issue of

notice was sufficiently introduced in the proceedings as one for decision. No perception of unfairness

to the parties should dissuade the Court from considering the issue just as the judge below did. No

request had been made for adjournment of the case to deal with the point on the basis that it was

unexpected. The way in which the issue arose during the trial should now be traced.

When the appellant was giving his evidence, notwithstanding objection made on behalf of the

respondent, evidence was permitted to be led of complaints about the condition of the internal staircase

made by the appellant to the respondent’s brother. The appellant’s counsel made it clear that his

submission was that the brother was the agent of the respondent for the purpose of receiving notice of

the condition of the premises. The judge allowed the evidence to be led reserving the point of

admissibility. The appellant proceeded to explain that on one occasion when the brother came around

to collect the rent, and while the brother was in a position to view the stairs leading down from the upper

floor of the flat he pointed out to him that the railing on the exposed side of the stairs away from the wall

was missing while every other flat had a stair railing in place and that a number of the steps were warped

and loose so that the staircase was, in effect, in a dangerous state. This was said in response to the

brother’s enquiry how the respondent was finding the flat.

Later in the trial, during the respondent’s case, a witness Casey was called. He was the

occupant of another unit in the block which contained seven units in all. Casey, during cross-

examination, said that he had been told by the respondent that if there were any problems with his unit

needing fixing he was to tell the respondent’s brother and the matter would be attended to. Casey also

said that he had observed the brother around the flats doing general maintenance work, gardening,

painting and changing tap washers.

In deciding that the appellant had not sufficiently shown that Jeff Bonney was the respondent’s

agent to receive notice of want of repair, the judge below must have adopted too stringent an approach.

Jeff Bonney was not only the respondent’s brother and an on-site resident, but he was the authorised

rent collector and one who undertook gardening and painting work in and around the whole block.

Also, in relation to one of the flats at least, where the position could not readily be distinguished from

the others, the respondent himself had expressly said to the occupant that Jeff Bonney was the one to

notify if things needed fixing. This last piece of evidence was not challenged in re-examination of Casey

by the respondent’s counsel. Further, neither the respondent nor his brother was called to controvert

any inferences arising from what the appellant and Casey said in evidence. The judge below was in no

better position than we are to decide what inferences arose from this uncontradicted circumstantial

evidence. The matter called for decision on the balance of probabilities and on no higher standard.

It should be concluded, contrary to what the judge below decided, that agency was sufficiently

shown and that notice of the need for repairs to deal with the dangerous situation of the staircase was

given to the landlord prior to the appellant’s fall and injury.

Counsel for the respondent argued that if the Court was disposed to come to the conclusion just stated, it still would not help the appellant’s case in contract because the notice to the respondent’s brother was not shown to have been given sufficiently long before the applicant’s injury to be regarded

as reasonable notice of the need for remedial work.

When a structural defect has arisen during the tenant’s period of occupation in the absence of

awareness by the landlord, cases showing the need for notice to establish liability speak in terms of

reasonable notice, see : Granada Theatres Ltd v Freehold Investment (Leytonstone) Ltd [1959] 2 All

E.R. 176 at 184 and Northern Sandblasting Pty Ltd v Harris (1997) 71 A.L.J.R. 1428 at 1457 per

Gummow J.

In the present case the evidence referring to the date on which the appellant’s conversation with

Jeff Bonney occurred was not firm in what it indicated. The appellant expressed himself in a way that

showed he could not be certain when it was. There were only about four to five weeks from the time

when the respondent notified that he had taken over as landlord up to 11 December 1991 when the

injury was sustained. However, the rent was collected weekly and if the appellant was not at the flat

when the respondent’s brother called, the brother would call again and not leave the outstanding rent

to the following usual rent collection day. The content of the conversation in which the brother enquired

about the appellant’s state of satisfaction with the tenancy points to it as being more likely to have taken

place on the first occasion of rental collection or at least towards the beginning rather than towards the

end of the four to five week period. Lacking precise indication though this evidence may be, it is the

only evidence that the appellant appeared to be able to contribute and nothing at all bearing upon the

date or even the occurrence of the conversation was forthcoming from the respondent or his brother.

There was no evidence from the respondent’s side showing whether an inspection had been made on

the respondent’s behalf before he completed his purchase, or thereafter, or indeed whether he had in

any way acted or even intended to act on the appellant’s forcible assertion of the need for remedial work. No indication was given to the appellant that something would be done about the dangerous

condition of the stairs. There was no evidence from either side of the availability of builders who might

be in a position to undertake the work. However, it is relevant that the flats were located in Mackay,

a substantial urban centre. No doubt, a question of onus arose and it can be accepted that the legal

onus fell on the appellant who had to establish breach of the covenant. This involved a requirement of

reasonable notice meaning a reasonable time to undertake the repairs. There are no findings below

assisting with the determination of the matter now being discussed because on the judge’s approach,

having found that no notice was given to the respondent or his agent, the matter did not need to be

further pursued.

The evidentiary onus that undoubtedly arose has to be considered by this Court looking at the

relevant evidence slight as it was although unopposed: cf. De Gioia v Darling Island Stevedoring &

Lighterage Co Ltd (1941) 42 SR (NSW) 1 at 3-4 and Ex parte Ferguson: Re Alexander (1944) 45

SR (NSW) 64 at 67. The issue cannot be determined just by looking at the legal onus. The matter is

complicated by the fact that the pleadings did not deal with the issue of notice at all although in the way

the trial was conducted the issue clearly arose.

Landlords who are obliged to repair can be expected to be more in touch with available

builders and workmen than tenants will be when they are not required to have direct contact with

tradesmen. It is to be noted that no hint of any impracticability in effecting repairs in the time available

came from the landlord’s side. It should be accepted that the dangers in the situation that existed called,

at least, for emergency repairs to be carried out: cf. Griffin v Pillet [1926] 1 K.B. 17 at 22. Some form

of protective railing could have been installed and the steps which were loose and slippery attended to.
It should be concluded that the respondent failed to take advantage of reasonable notice of the

need to repair. The respondent will thus be liable in contract for breach of covenant and the appeal

should be allowed.

Notwithstanding this conclusion it is appropriate to give some consideration to the possibility

that the respondent is also liable in tort. The judge below without any extended statement of reasons,

simply declared that there was no basis of liability in tort. Presumably he considered that contract

governed the situation to the exclusion of the possibility of a superimposed or parallel liability in tort.

On this question, the recent High Court decision in Northern Sandblasting Pty Ltd v. Harris (supra)

should be consulted.

A full examination of the liability of landlords of dwelling-houses for injuries caused due to their

unsafe condition is undertaken in Sandblasting and numerous authorities are referred to in that case. It

is fair to say that there are unusual difficulties in establishing the precise ratio for the Court’s decision in

Sandblasting but nevertheless the issues to be decided in the present case will be assisted by reference

to the reasons of the judges there. It should also be said that Sandblasting deals with matters and offers

answers to a number of problems which do not arise here. In that case the injured plaintiff seeking

damages from the landlord was not the tenant and therefore not a contracting party but only a member

of the tenant’s household. In the present case we are concerned with the duty owed to the tenant

himself but once again in connection with the letting of a dwelling.

Although an opinion has already been expressed upon the liability of the respondent under the

implied covenant contained in the contract of letting some aspects of that question can helpfully be

returned to again. Three of the judges who took part in the decision in Sandblasting, Dawson,

Gummow and Kirby JJ, considered that the statutory contractual obligation could arise only under the Residential Tenancies Act. Another judge, Gaudron J, thought that in the circumstances of that case

there was no practical difference between the statutory obligations that arose under the Residential

Tenancies Act and those under the rather similar provisions of the Property Law Act 1974. However,

there is no need to delay further on that aspect here.

The precise content of the landlord’s duty resulting from the statutory provisions was another

matter considered in Sandblasting. Three of the judges, Gaudron, Gummow and Kirby JJ, said

explicitly that the statute did not give rise to an absolute duty of care. Brennan CJ stated that the duty

arising under the statute was to make the premises as safe as reasonable care and skill on the part of

anyone could make them. It might be added that the level of obligation under the statutory covenant

has been the subject of too many judicial pronouncements over an extended period for any support to

be given to a contention that the terms of the implied statutory covenant give rise to an absolute duty.

Again there is no need to delay further on refinements affecting the content of the duty and a conclusion

has already been expressed upon the extent of the contractual duty based on the facts here. It has been

concluded that reasonable notice of defective condition of the premises was given to the landlord’s

agent.

Passing then specifically to the topic of common law liability it should first be recorded that the

doctrine earlier established by cases such as Cavalier v Pope [1906] A.C. 428 which had the effect of

limiting a landlord’s liability in tort for the defective condition of premises can no longer be accepted.

A landlord undoubtedly owes a common law duty in respect of the condition of a dwelling. So far as

a member of the tenant’s household is concerned this was conceded in Sandblasting with the concession

fully accepted if not positively supported by all of the judges in that case. A common law duty should

be taken as applying also in the case of a tenant. Gaudron J in her reasons added a specific reference to Bryan v Maloney (1995) 182 C.L.R. 609 in support of the proposition that no conceptual difficulty

should be found in the assertion that the two duties, in common law and under statute, could co-exist.

One question which was much debated in Sandblasting and arises here concerns the content

of the common law duty of care that the landlord owes. Three of the judges in Sandblasting, Brennan

CJ, Toohey and McHugh JJ decided that the duty was one, in effect, to ensure that reasonable care was

taken thus applying a standard that has been evolved in the case of so-called non-delegable duties but

three other judges, Dawson, Gaudron and Kirby JJ held that the duty of the landlord was no more than

the ordinary duty to take reasonable care. In the present case since the proper conclusion is that the

lower level of care was not in fact complied with, the determination of this case will not involve drawing

any distinction between the two standards.

There was a further difference among the judges in Sandblasting. Brennan CJ decided that the

conditions for operation of the duty of care involved its being limited to defects existing at the

commencement of the tenancy. Gaudron J in expressing her conclusion found that there was a duty

upon a landlord to make an inspection prior to the commencement of a tenancy.

It should be repeated that it is not necessary here to attempt to decide some of these

contentious issues. Notice was in fact given to the landlord’s agent and there is no evidence that the

landlord took any steps to remedy the defect. Liability at common law may on the facts be extended

beyond the scope of contractual liability by the operation of certain general considerations. No more

than a general duty of care need be assumed. The respondent may, in fact, have inspected the premises

before purchasing them or may have received some relevant information about their state and in

particular concerning the state of the staircase in the appellant’s flat before he purchased. The alternative possibility is that he purchased without relevant knowledge or investigation and that he did

not thereafter inspect. Then his agent received the tenant’s complaints but no remedial work was

performed. The conclusion should be that to have done nothing in those circumstances amounted to

a failure to take reasonable care to prevent foreseeable injury to his tenant. The result is that the

respondent should be held liable in tort for breach of a general duty of care and there is then no reason

not to accept the proportions of liability as determined by the judge below.

A concession was made in the present case by the appellant’s counsel. It was accepted that

if it should be determined that liability existed both under the statutory implied covenant and under the

general tortious duty of care the apportionment legislation would apply. In view of that concession it

is unnecessary in this case to examine the question further. The concession should be acted on.

Counsel for the respondent made no submissions in respect of it.

The result is the appeal should be allowed, the judgment below set aside and judgment entered

in lieu for the appellant for $35,039.20 being 70 percent of the total damages assessed. The appellant

should have the costs of the appeal and of the proceedings below.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 60 of 1995

Brisbane

Before Macrossan CJ
Thomas J
Helman J

[Austin v. Bonney]

BETWEEN:

DAVID ALBERT AUSTIN

(Plaintiff) Appellant

AND:

CLIVE RAYMOND BONNEY

(Defendant) Respondent

REASONS FOR JUDGMENT - THOMAS J

Judgment delivered 12 February 1998

This case concerns the liability of a landlord to a tenant who suffered personal injury by reason

of a defective condition in the demised premises. The appellant tenant sued in both contract and tort,

and failed at first instance in the District Court.

The primary facts are set out in the reasons of the Chief Justice and Helman J. Consistently with

those reasons, unless the respondent had notice of the defective condition of the staircase in

circumstances affording him a reasonable opportunity of rectifying it before the appellant’s fall, the

appellant cannot succeed in either contract or tort. Further reasons for this conclusion are contained

hereunder.

The result of this appeal turns then on the inferences that are to be drawn from the evidence

concerning knowledge on the landlord’s part of the relevant defect, the time of giving notice of it to him,

and whether he is shown to have acted unreasonably in failing to cause the defect to be remedied before

the appellant was injured.

The Chief Justice has concluded and Helman J has assumed for the purpose of argument that

the learned primary judge erred in failing to hold that the respondent’s brother, Jeff Bonney, was the

respondent’s agent for the purpose of receiving notice of any need for repair to the premises. For

reasons given hereunder I think that it should have been inferred that he was his brother’s agent to this

extent. However the further question arises whether it should be inferred that notice was given to Jeff

Bonney in sufficient time for it to be regarded as reasonable notice for the respondent to have arranged

for necessary remedial work. This is the critical question.

In this case the appellant tenant had been in occupation of the premises for more than twelve

months prior to his accident, whereas the landlord had become associated with the premises by

purchasing the freehold a little under five weeks before the accident. There is no evidence from which

it can be inferred that the respondent inspected the premises before purchase or indeed after purchase.

The evidence as a whole suggests that Jeff Bonney was the respondent’s man on the site entrusted with

doing whatever had to be done in order to look after his brother’s investment. There is evidence that

Jeff Bonney occupied one of the flats and that he did general maintenance work on them. There is also

evidence that the respondent stated to a third party that if there were any problems with his unit that

needed fixing he should tell Jeff Bonney and it would be attended to. There is no good reason to think

that this authority was limited to that particular flat. Jeff Bonney also had a general authority to collect

rent for the respondent.

I agree with the other members of the Court that the learned primary judge erred in failing to

draw the inference that Jeff Bonney had authority to receive on behalf of his brother notices from tenants

including notice of existence of a defect that needed attention.

However that inference is not enough to permit the appellant to succeed. Consistently with the

reasoning in Morgan v Liverpool Corporation[1], McCarrick v Liverpool Corporation[2] and O’Brien

[1] [1927] 2 KB 131.

[2] [1947] AC 219.

v Robinson[3] (which has not in relevant respects been disapproved in the High Court decision in

[3] [1973] AC 912.

Northern Sandblasting Pty Ltd v Harris[4]), it needs to be shown that notice was given to the landlord

[4] (1997) 188 CLR 313.

in sufficient time for him to have rectified the defects. It would seem that the circumstances relevant to

this issue were not adequately explored at trial, but they have now come under sharp scrutiny on appeal.

The plaint does not advert to any question of notice. It simply asserts that the respondent owed a duty

of care “to ensure that the property was provided and maintained in safe condition and good repair” and

pleads in the alternative that the tenancy agreement was subject to implied conditions “to provide and,

during the tenancy, maintain the dwelling house in good tenantable repair and in a condition fit for human habitation”. The defence consists essentially of denials, non-admissions, and an allegation of

contributory negligence.

In my view the appellant bore an onus, in order to establish the existence of the alleged duties

and breach thereof, of showing that the respondent had notice of the defect a reasonable time before

the accident. By “reasonable time” I mean within such a time as would enable a reasonable landlord

to rectify the defects.

No evidence was given concerning the time when the oral notice was given by the appellant to

the respondent’s brother. It could have been any day between 7 November 1991 and 11 December

1991. I think it would be stretching matters somewhat for this Court to infer that it was probably

towards the beginning of the tenancy when there is simply no satisfactory evidence on the point, and

when counsel who had the opportunity to pursue the question did not do so. In the end it is a matter

where the evidence at the end of the day does not permit a safe inference to be drawn. It is also the

fact that no evidence was led as to the actual work that would be required to effect the necessary

alterations. The necessary works would have involved building tasks involving the stairway and

handrail. Quotations would have to have been obtained, and appropriate handrails, steps and other

parts would have to be selected and cut to size. Presumably some arrangements would then need to

have been made with the tenant for a convenient date for access while the building works were

performed. I do not for a moment suggest that the necessary works were substantial, but it cannot be

said that it was a project where one could safely assume that rectification would reasonably be expected

to be achieved within a week or even a fortnight of notice of complaint. In the computation of a

reasonable time there ought also, I think, to be allowed a few days for communication to be made

between the respondent’s agent and the respondent. This question, although of comparatively slight importance in the context of the present case, is relevant. It involves some difficulty, and will now be

discussed.

Time for agent to notify principal

The question arises whether the oral notice given to the respondent’s brother should be taken

to have been given then and there to the respondent or whether it should be taken to have been passed

on to the principal in due course by the agent. In other words, is the notice of defective repair to be

taken to have been received by the respondent

(1)	at the time when his agent acquired the relevant knowledge (i.e. immediately), or
(2)	when the agent should have communicated the knowledge to the principal (i.e. in due
course)?

English and Australian authorities do not address this problem explicitly, and to the extent that the

subject has arisen in decided cases, no uniform approach is discernible. Bowstead and Reynolds on

Agency 16th ed., 1996) draw attention to the distinction taken in the United States between notification

and knowledge.[5] With this distinction in mind, the authors suggest–

[5]             American Restatement (2nd) Agency 1958, paras. 270, 278.

“A notification should take effect on receipt: knowledge however should often only be regarded as effective from the time when it was or ought to have been received by the principal.”[6]

[6]             Bowstead and Reynolds p.533.

In relation to knowledge, the American Restatement provides

“When agent’s knowledge affects principal

The principal is affected by the knowledge which the agent has when acting for him or, if it is the duty of the agent to communicate the information and not otherwise to act, the principal is affected after the lapse of such time as is reasonable for its communication.”7

Thus where an agent has a duty to convey information to his principal but does not do so, the principal

is fixed with knowledge of the relevant information at the time when it should have been conveyed to

the principal.

Westbury L.C. has stated that the doctrine of constructive notice is based upon the assumption

that the agent told the principal something it was important he should know.8 If ostensible authority is

relied on as the basis of an imputation of knowledge–

7              American Restatement, para 278.

8              Wyllie v Pollen (1863) 32 L.J.Ch. 782, 783.

“ The imputation to a principal of the knowledge of an agent when that knowledge has been disclosed to him in reliance upon his ostensible authority to receive it is an application of the principles of estoppel. Though the agent may not in fact have the principal’s authority to receive the disclosure so as to bind the principal as if the latter had knowledge of it, yet the principal may not aver that he was not notified of the facts disclosed, for by holding out the agent he must be deemed, as against the third party, to have given the authority which in fact the contract of agency may not have conferred.”[9]

[9]             Per Turner P in Blackley v National Mutual Life Association of Australasia Limited [1972] NZLR 1038.

Of the three members of the New Zealand Court of Appeal in Blackley two appeared to adopt the

following formulation of the rule as set out in the 13th ed. of Bowstead

“When any fact or circumstance, material to any transaction, business or matter in respect of which an agent is employed, comes to his knowledge in the course of such employment, and is of such a nature that it is his duty to communicate it to his principal, the principal is deemed to have notice thereof as from the time when he would have received such notice if the agent had performed his duty, and taken such steps to communicate the fact or circumstance as he ought reasonably to have taken.”[10]

[10]            Bowstead p.355; Blackley pp 1045, 1059.

Halsbury’s Laws of Australia formulates the rule in a similar manner–

“Notice to agent Where, in the course of any transaction in which the agent is employed on the principal’s behalf, an agent receives notice or acquires knowledge of any fact material to the transaction, under circumstances where it is the agent’s duty to communicate it to the principal, the principal . . . is taken to have received notice of it from the agent at the time when the principal should have received it, if the agent had performed that duty with due diligence.”[11]

[11]            [15-295]

A similar approach is apparent in Granada Theatres Ltd v Freehold Investment (Leytonstone)

Ltd[12], and in Lord Diplock’s confirmation in O’Brien v Robinson of previous decisions expressed as

[12] [1959] 2 All ER 176, 184.

follows

“[T]he landlord’s obligation to start carrying out any works of repair did not arise until he had information about the existence of a defect in the premises such as would put a reasonable man upon inquiry as to whether works of repair were needed.”[13]

[13]            At p.928.

His Lordship added

“Until that time arrives there can be no breach of the obligation: nor can there be any breach thereafter if the landlord then carries out the necessary work of repair with reasonable expedition.”[14]

[14]            Ibid p.928.

It seems to me then that where notice is dependent upon an agent’s duty to communicate

information to a principal, there must be taken into account a reasonable time for such communication.

The same result follows whether the question arises in the context of the claim in contract or in

tort. Of course, in a contractual claim it will be possible for special provisions to bind the parties in

relation to notice, provided these are not inconsistent with s.7 of the Residential Tenancies Act 1975

or other relevant legislation. But leaving aside special contractual or statutory provisions, the common

law basis of contractual liability of this kind is that the landlord possesses information as to the existence

of a defect such as would put a reasonable landlord on enquiry as to whether repair was needed,

followed by a failure on the landlord’s part to carry out the necessary works with reasonable

expedition.[15]

[15]            Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313, 370-371 per Gummow J.

Similarly, it is a necessary basis of a respondent’s liability in negligence that there be an absence

of reasonable response in the circumstances. This suggests that it is necessary to take into account the

actual time available to the landlord to respond, rather than an artificially imputed time.

In the present case little is known of the relationship between the respondent and his brother

Jeff Bonney, other than the fact that he had a post office address at Moranbah and his brother lived in

one of his flats in Mackay. Again, this matter was not relevantly explored at trial. Even so, it could

probably be inferred that only a few days would be necessary in the ordinary course for communication

to be made.

Negligence

Insofar as the appellant relies upon a case in negligence, it may be taken that there may be

sufficient proximity between a landlord and a tenant for a common law duty to be owed by the former

to the latter. But of course relations and dealings between landlord and tenant are always affected to

some extent, and in many cases to a very considerable extent, by the contract between them; and this

in turn may be further affected by statutory terms and conditions. The basis of liability in what used to

be referred to as occupiers’ liability cases used to be primarily dependent upon the respondent’s

occupation and control rather than upon ownership of the premises (Indermaur v Dames[16]; Miller v

[16]            (1866) LR 1CP 274.

Hancock[17]; Cavalier v Pope[18]). One consequence of this was that an injured visitor had to seek

[17] [1893] 2 QB 177, 180 (per Bowen LJ).

[18] [1906] AC 428, 433-434.

redress against the person with the power to admit and exclude, that is to say, the tenant rather than the

landlord. However, as Miller v Hancock illustrates, where some control was retained by the landlord over a part of the premises, the landlord might be held liable for the consequences of a defective

condition in that part.

The content of the common law duty of care was the subject of different views in the Northern

Sandblasting case above. I accept the view of Dawson, Gaudron, Gummow and Kirby JJ that the

landlord’s duty is no more and no less than the ordinary duty to take reasonable care, and consider that

earlier decisions of the High Court[19] justify that conclusion. The difficulty lies in identifying the “ordinary

[19]            Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479; Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16.

duty” when the parties happen to be landlord and tenant. No one suggests that the duty is absolute, and

it is difficult to think that tortious liability should exist in respect of matters of which a landlord was

reasonably unaware.[20] Of course in the usual case, the landlord will have sufficient knowledge of the

[20]            This phrase was used by Kirby J in relation to the contractual cause of action in Northern Sandblasting.

state of the premises, or at least of their condition when possession was given to the tenant. But such

evidence is lacking in the present case.

The special rules attaching to occupiers’ liability cases were swept away in Australian Safeway

Stores Pty Ltd v Zaluzna[21], and replaced by more general rules applicable to the law of negligence,

[21] (1987) 162 CLR 479.

including the need for a relationship of proximity and the requirement that “the measure of the discharge

of the duty is what a reasonable man would, in the circumstances, do by way of response to the

foreseeable risk”.[22] Unfortunately there has been no consensus in the High Court upon the criteria that

[22]            Australian Safeway Stores, p.488; Hackshaw v Shaw (1984) 155 CLR 614, 662-663.

assist to determine these very broad concepts. The relative predictability in occupiers’ liability law when

categories of occupation were relevantly identified and illustrated by case law is no longer with us. How

then is the duty to be identified when the “neighbours” are landlord and tenant? In my view the question

of control remains relevant to the determination whether there exists a duty of care, and whether it has

been breached in the circumstances. How can one sensibly determine duties between such parties

without knowing who is responsible for relevant repair or who decides who comes and goes? If parties

have already by contract defined these matters, or some of them, which affect relative control and ability

to react by causing the removal of a dangerous situation, surely this must affect the determination of the

duties that each owe to the other. Similarly the reasonableness of expecting one party to cause the

danger to be removed, including the economic reasonableness of so doing must be relevant[23]. Leaving

[23]            Wyong Shire Council v Shirt (1980) 146 CLR 40, 47-48:

aside cases of wilful blindness, knowledge on the part of the landlord of the relevant defect and a

reasonable opportunity to do something about it must also be of considerable importance.

Conclusion

In the present circumstances I do not think that it is open to this Court to substitute the

necessary factual findings to establish liability on the respondent’s part.

It is pure guesswork (as distinct from proper inference) whether the appellant’s conversation

with Jeff Bonney occurred toward the beginning, middle or end of the limited period (under five weeks)

between the respondent’s acquisition of the premises and the appellant’s accident. Further, evidence

was not led from which it could be safely inferred that a very short or insignificant period would

constitute a reasonable time for a reasonable landlord to effect the necessary repairs. In this respect

consideration would need to be given to a reasonable time for receipt of notification from the

respondent’s agent, and, more importantly, a reasonable time for assessing, arranging and effecting the

necessary repairs. Plainly these matters were not adequately explored at trial, and it is not appropriate

for this Court to make the necessary additional factual findings that would permit the appellant to

succeed.

The appeal should be dismissed with costs.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 60 of 1995

Brisbane

Before Macrossan C.J.
Thomas J.
Helman J.

[Austin v. Bonney]

BETWEEN:  DAVID ALBERT AUSTIN

(Plaintiff) Appellant

AND:

CLIVE RAYMOND BONNEY

(Defendant) Respondent

REASONS FOR JUDGMENT - HELMAN J.

Judgment delivered 12 February 1998

This is an appeal against the dismissal, in the Mackay District Court on 17 March 1995, of the

appellant’s action against the respondent. The appellant had claimed $200,000.00 as damages for

personal injuries, alleging that the respondent had been guilty of a breach of a tenancy agreement

between the appellant as tenant and the respondent as landlord and, or alternatively, the tort of

negligence. Although a number of the grounds of appeal were couched in general terms, the chief issue

before us concerned a finding by the learned trial judge concerning what notice the respondent had of

the state of the premises in question. A point was raised in written submissions to this Court concerning

the competence of the appeal but was not pursued in oral argument, which was all directed to the merits

of the appeal. I do not propose to consider the preliminary matter further.

The action arose out of an incident which occurred on 11 December 1991. The appellant, who

had occupied a flat, unit 4, in a building at 103 Milton Street, Mackay as a tenant for approximately a

year, fell down an internal staircase in the flat. The most serious injury suffered in the fall was the

traumatic amputation of his left little finger at the proximal interphalangeal joint. The fall also played a

part, but only a minor one the judge found, in causing the appellant to suffer some discomfort in his

lower back. His Honour assessed the appellant’s damages at $50,056.00. That assessment was not

challenged before us, nor was his Honour’s assessment that thirty per cent. of the damage suffered by

the appellant resulted from his own carelessness.

His Honour found the staircase had been defective and dangerous on the day of the fall: it

lacked a handrail and some of the treads were warped, loose, and slippery. Those defects led his

Honour to conclude that the flat had not been in good tenantable repair. No challenge was made to

that conclusion before us.

The general rule at common law was that in the absence of express stipulation in a tenancy

agreement a landlord was under no liability to a tenant to put demised premises into repair at the

beginning of a tenancy, or to do repairs during the continuance of the tenancy: see Halsbury’s Laws

of England, 4th ed. re-issue, volume 27(1), para.328, p.308. On the letting of an unfurnished dwelling

house, therefore, there was no implied warranty on the part of the landlord that it was in a reasonably

fit state for habitation: Hart v. Windsor (1843) 12 M. & W.68 at p.86; 152 E.R. 1114 at p.1,122.

To that general rule there was an exception when a furnished house was let: in such a case there was

an implied condition that the house was in a fit state for habitation at the beginning of the tenancy: Smith

v. Marrable (1843) 11 M. & W.5 at p.8; 152 E.R. 693 at p.694. There was, however, no implied

condition or warranty that the premises would remain fit for habitation throughout the term: Sarson v.
Roberts [1895] 2 Q.B. 395.

The appellant did not rely on the common law in pursuing his claim in contract, but rather on

the Residential Tenancies Act 1975, which applied to the tenancy of the flat, a “dwelling-house” within

the meaning of that term in the Act. By s.7(a)(ii), notwithstanding any agreement between a landlord

and a tenant, in every tenancy agreement entered into after the commencement of the Act on 1

December 1975 there was implied an obligation on the part of the landlord to provide and, during the

tenancy, to maintain, the dwelling house in good tenantable repair and in a condition fit for human

habitation. By s.7(a)(iii) there was an implied obligation on the part of the landlord to maintain during

the tenancy fixtures, fittings, goods and chattels let with the dwelling-house in good tenantable repair.

His Honour found against the appellant on the claim in contract because he was not satisfied that

it had been shown that the respondent had knowledge of the defective staircase or had been put on

enquiry as to the state the staircase and there was no evidence that notice of the condition of the

staircase had been given to him.

It is important to note that the effect s.7(a)(ii) is to include in the tenancy agreement a

contractual obligation binding the landlord to the tenant, not to subject the landlord to a statutory duty

of performance: see McCarrick v. Liverpool Corporation [1947] A.C. 219 at p.230 per Lord

Uthwatt in which case the House considered a statute similar to the Residential Tenancies Act; and

Northern Sandblasting Pty Ltd v. Harris (1997) 188 C.L.R. 313 at p.327 per Brennan C.J.

It is now well established that breach of a landlord’s obligation to keep demised premises in

repair cannot in general be established by proof that the premises have fallen into disrepair, without

more. As Gummow J. observed in Northern Sandblasting Pty Ltd v. Harris:

“In general, there is no breach of an express covenant by a landlord to keep the demised premises in repair unless two criteria have been met. First, the landlord must have information as to the existence of the defect such as would put a reasonable landlord on inquiry as to whether works of repair are needed and, secondly, thereafter the landlord must have failed to carry out the necessary works with reasonable expedition.” (pp.370-371)

His Honour added that, as Cussen J. had pointed out in Dunlop v. Troy [1915] V.L.R. 639 at p.644,

this is a rule of construction to be considered with the text of the particular lease, not a rule of law.

In this case the appellant had been in occupation of the flat before the respondent acquired the

land and building on 7 November 1991. The appellant was notified of the change of landlord in a letter

of the same date from the respondent’s solicitors who were then acting for the previous landlords. In

those circumstances his Honour concluded, correctly in my view, that the respondent’s obligation to

provide, and, during the tenancy, to maintain, the unit in good tenantable repair, etc., was one obligation

and not two. His Honour accepted, again correctly in my view, that the provision obligation might be

thought to be different from the maintenance obligation when a landlord had prior possession of the

premises, but where, as in this case, the landlord had purchased the premises subject to a tenancy the

obligations merge into one. To treat the case otherwise would be artificial.

Since the appellant was the occupier of the flat from when the respondent became the landlord

and until his fall, it was necessary for the appellant to satisfy the criteria referred to by Gummow J.

before he could succeed in his claim in contract. His Honour's findings of fact which lead to his

concluding that the appellant had failed in that claim were as follows:

“There is no evidence that the plaintiff had any conversation with the defendant following his receipt of the letter of 7 November 1991. He did have a conversation with Mr Jeff Bonney who is evidently the brother of the defendant and who lived in Unit 3. That conversation related to the collection of the rent by Mr Jeff Bonney and the plaintiff also says that he complained to him about the condition of the stairs. In particular he said that the stairs needed bolts and that the treads were bent and warped. He also inquired why he did not have a handrail on his stairs, observing that he was the only tenant without one.

The purpose of adducing this conversation was to attempt to establish an agency between Mr Jeff Bonney and the defendant, so that the defendant would become fixed with knowledge of the complaint made by the plaintiff to his brother. Also in aid of this was some evidence given by another tenant, Mr Casey, who said in cross-examination that the defendant had told him that his brother Jeff had authority to fix things up in his (Mr Casey’s) flat. Mr Casey also said that he saw Jeff Bonney doing some general maintenance work around the flats. This evidence in my opinion falls short of establishing any agency on the part of Jeff Bonney to receive on behalf of the defendant notice of any want of repair or maintenance in relation to the tenancies in the building (except for Mr Casey’s tenancy) and, in particular, in relation to the plaintiff’s tenancy. There is no evidence that Mr Jeff Bonney carried out any repairs to Unit number 4, nor is there evidence that Mr Casey had told the plaintiff what the defendant had told him, or that the plaintiff had seen the defendant’s brother doing maintenance work around the flats so far as concerns the plaintiff, the evidence shows no more than that Mr Jeff Bonney was or represented himself to be the defendant’s agent to collect the rent from the plaintiff. The defendant did not himself give evidence but his failure to do so, does not enable me to infer that his brother was relevantly his agent, or that what was said to his brother by the plaintiff in fact came to his knowledge. Similarly the brother was not a witness called on either side. In these circumstances any complaint made by the plaintiff to Mr Jeff Bonney cannot be treated as being within the knowledge of the defendant.”

There was no challenge to the primary facts set out in that passage, but we were urged to conclude that

his Honour had erred in failing to draw the inference from the primary facts that the respondent did

indeed know of the defective staircase. If a relevant fact is an inference to be drawn from established

facts an appeal court may of course be in as a good a position as the judge at trial: Warren v. Coombes

(1979) 142 C.L.R. 531 at p.551, and Zuvela v. Cosmarnan Concrete Pty Ltd (1996) 71 A.L.J.R.

29 at p.31.

It may be assumed that it is arguable that the facts proved - particularly the relationship between

the respondent and Mr Jeff Bonney, and the evidence of Mr Casey - and the absence of any challenge

to the evidence of those facts in other evidence should lead to the conclusions that, more probably than

not, Mr Jeff Bonney was the agent of the respondent for the purpose of receiving complaints and that

the respondent knew of the defective staircase at some time before the appellant’s fall. It is, however, not necessary to pursue that matter because the appellant’s evidence as to when he notified Mr Jeff

Bonney of the state of the staircase was so lacking in precision as to be fatal to his case.

The appellant’s evidence was to the effect that Mr Jeff Bonney collected the rent every Friday,

but when asked whether he had complained about the condition of the premises on Mr Jeff Bonney’s

first visit he said he was not too sure if it was then or “later on”. In answer to another question on the

subject he agreed that the complaint had been made “at some stage” between 7 November and 11

December 1991. That was as far as the evidence went. The question of the time of the appellant’s

giving notice was important, because if it were given too late in the period between 7 November and

11 December the respondent may not have had enough time to carry out the necessary repairs. If that

were so than it would not be possible for the appellant to satisfy the second criterion referred to by

Gummow J. in the passage I have quoted. In my view the evidence on this subject was indeed so vague

as to make it impossible to determine when the notice was given. The appellant therefore could not

have succeeded before his Honour on his claim in contract even if his Honour had reached different

conclusions on the questions of agency and notice.

On the evidence the appellant’s claim in tort could not have succeeded either. According to

the principle explained by Brennan C.J. in Northern Sandblasting Pty Ltd v. Harris at pp.333-340

a landlord who lets a tenant into possession of defective premises may be liable to the tenant in tort.

The appellant must have failed had he relied on that principle because he was at all material times in

possession of the premises, having been in occupation of them prior to the respondent’s becoming his

landlord. Had the appellant sought on the other hand to rely on his having given notice of defects - see

e.g. Northern Sandblasting Pty Ltd v. Harris at pp.359-360, per Gaudron J. - he would have failed

in tort for the same reason as he did in contract.

Since the appellant on the evidence could not have succeeded in either contract or tort the

appeal should be dismissed with costs.

“The perception of the reasonable man’s response calls for a consideration of the magnitude of the risk and the degree of the probability of its occurrence along with the expense, difficulty and inconvenience of taking alleviating action and any other conflicting responsibilities which the defendant may have.”