Laresu Pty Ltd v Clark

[2010] NSWCA 180

New South Wales

Court of Appeal

CITATION:	Laresu Pty Ltd v Clark [2010] NSWCA 180
HEARING DATE(S):	29 June 2010
JUDGMENT DATE:	4 August 2010
JUDGMENT OF:	Tobias JA at 1; Macfarlan JA at 2; Handley AJA at 99
DECISION:	(1) The appeal is allowed in part; (2) By consent, vary the amount of the judgment entered against the Owner in favour of Mr Clark by substituting the amount of $120,064.12 for the amount of $160,000; (3) Set aside the order of Christie ADCJ made on 28 May 2009 dismissing the Owner’s Cross Claim against the Managing Agent; (4) Order that the Managing Agent contribute to the Owner 60 per cent of the Owner’s judgment liability to Mr Clark; (5) Set aside the judgment directed on 28 May 2009 in favour of the Managing Agent against Mr Clark, together with the order that Mr Clark pay the costs of the Managing Agent; (6) Direct the entry of judgment in favour of Mr Clark against the Managing Agent in the amount of $120,064.12; (7) Order that the Owner and Managing Agent pay Mr Clark’s costs of the appeal; (8) Order that the Managing Agent pay Mr Clark’s costs of the proceedings at first instance (this order being in addition to the order made at first instance that the Owner pay Mr Clark’s costs of the proceedings at first instance); (9) Order that the Managing Agent pay 60 per cent of the Owner’s costs at first instance and on appeal of the Owner’s Cross Claim against the Managing Agent and of the costs payable by the Owner to Mr Clark in respect of Mr Clark’s claim against the Owner; (10) Order that the Managing Agent pay the Owner’s costs at first instance and on appeal of the Managing Agent’s Cross Claim against the Owner; (11) Grant leave to the Managing Agent to apply within 14 days of the date of this judgment for an order against the Owner for contribution in respect of the Managing Agent’s liability to Mr Clark (including as to costs) and for associated orders, including an order as to the costs of its Cross Claim; and (12) The Managing Agent to have a certificate under the Suitors’ Fund Act 1951, if qualified.
CATCHWORDS:	TORTS - negligence - occupier's liability - whether owner of commercial premises delegated to managing agent its duty of care as occupier of common property - whether managing agent an occupier of common property - plaintiff injured in fall on unlit stairs - whether breach of duty by occupier - Civil Liability Act 2002 s 5B - CONTRACT - principal and agent - obligations of managing agent of commercial premises - whether entitled to indemnity from principal - LANDLORD AND TENANT - appointment of managing agent of commercial premises - meaning of "maintenance" of premises - whether extended to setting of automatic light switch
LEGISLATION CITED:	Civil Liability Act 2002 Law Reform (Miscellaneous Provisions) Act 1946 Strata Titles Act 1973
CATEGORY:	Principal judgment
CASES CITED:	Adeels Palace Pty Ltd v Moubarak [2009] HCA 48; (2009) 239 CLR 420 Andar Transport Pty Ltd v Brambles Ltd [2004] HCA 28; (2004) 217 CLR 424 Ankar Pty Ltd v National Westminster Finance (Australia) Ltd [1987] HCA 15; (1986-1987) 162 CLR 549 Australian Safeway Stores Pty Ltd v Zaluzna [1987] HCA 7; (1986-1987) 162 CLR 479 Bevillesta Pty Ltd v Liberty International Insurance Co [2009] NSWCA 16 British Fame (Owners) v Macgregor (Owners) [1943] AC 197 Chen v Chan [2008] VSCA 280 Costa v Public Trustee of NSW [2008] NSWCA 223 Doubleday v Kelly [2005] NSWCA 151 Francis v Lewis [2003] NSWCA 152 Indermaur v Dames (1866) LR 1 CP 274 Jones v Bartlett [2000] HCA 56; (2000) 205 CLR 166 Joslyn v Berryman [2003] HCA 34; (2003) 214 CLR 552 MCA International BV v Northern Star Holdings Ltd (1991) 4 ACSR 719 Multicon Engineering Pty Ltd v Federal Airports Corporation (1997) 47 NSWLR 631 Penrith Rugby League Club Ltd trading as Cardiff Panthers v Elliot [2009] NSWCA 247 Podrebersek v Australian Iron and Steel Pty Ltd (1985) 59 ALJR 492 Proprietors – Strata Plan 30234 v Margiz (1993) 32 NSWLR 294 Ridis v Proprietors of Strata Plan 10308 [2005] NSWCA 246 Roads and Traffic Authority of New South Wales v Dederer [2007] HCA 42; (2007) 234 CLR 330 Roads and Traffic Authority of NSW v Refrigerated Roadways Pty Ltd [2009] NSWCA 263; (2009) 53 MVR 502 Sattel v The Proprietors – Be Bees Tropical Apartments Building Units Plan No 71593 (No 2) [2001] QCA 560; [2002] 2 Qd R 427 Sevenoaks, Maidstone and Tunbridge Railway Co v London Chatham and Dover Railway Co (1879) 11 Ch D 625 Stojan (No 9) Pty Ltd v Kenway [2009] NSWCA 364 Thompson v Woolworths (Q’Land) Pty Ltd [2005] HCA 19; (2005) 221 CLR 234 Voli v Inglewood Shire Council [1963] HCA 15; (1962-1963) 110 CLR 74 Wheat v E Lacon & Co Ltd [1966] AC 552 Wilkinson v Law Courts Ltd [2001] NSWCA 196 Wyong Shire Council v Shirt [1980] HCA 12; (1980) 146 CLR 40
PARTIES:	Laresu Pty Ltd (Appellant) Alan Clark (First Respondent) Mark Newey Pty Ltd (Second Respondent) Larrill Pty Ltd (Third Respondent) Carl Zaubzer Pty Ltd t/as W T Newey & Co (Fourth Respondent)
FILE NUMBER(S):	CA 2009/298463
COUNSEL:	S G Campbell SC (Appellant) B Dooley SC/M Best (First Respondent) R Cavanagh/C Purdy (Second, Third and Fourth Respondents)
SOLICITORS:	McCabe Terrill Lawyers (Appellant) Scully Legal (First Respondent) Thompson Cooper Lawyers (Second, Third and Fourth Respondents)
LOWER COURT JURISDICTION:	District Court
LOWER COURT FILE NUMBER(S):	2306/2007
LOWER COURT JUDICIAL OFFICER:	Christie ADCJ
LOWER COURT DATE OF DECISION:	28 May 2009

CA 2009/298463

TOBIAS JA
MACFARLAN JA
HANDLEY AJA

4 AUGUST 2010

LARESU PTY LTD v CLARK

Judgment

1 TOBIAS JA: I agree with Macfarlan JA.

:

Nature of Case and Conclusions

3 On the evening of 7 June 2004 the first respondent to this appeal, Mr Alan Clark, was injured when he fell down stairs in a small retail and commercial building situated in Bankstown, Sydney. Mr Clark was visiting a friend, Mr Rajasuriar, who rented a shop on the ground floor of the building. Mr Rajasuriar gave Mr Clark a key to enable him to use the toilet located on common property of the premises. Mr Clark slipped and fell on a flight of stairs in an unlit area of this common property. The light in this area was operated by an automatic light switch that had turned the light out some hours earlier. It was not possible for persons using this common property to turn the light on manually.

4 Mr Clark sued the appellant, which was the owner of the premises, claiming damages upon the basis that the appellant was also the occupier of the premises. Mr Clark also sued Mark Newey Pty Ltd, Larrill Pty Ltd and Carl Zaubzer Pty Ltd which together carried on business under the name W T Newey & Co. These companies (collectively referred to in this judgment as the “Managing Agent”) were alleged to have breached a duty of care that they owed to Mr Clark by reason of their assumption of the role of managing agent of the premises.

5 In summary, my conclusions are as follows:

(a) The appellant, as occupier of the common property of the premises, owed a duty to Mr Clark to take reasonable care to avoid a foreseeable risk of injury to him (see [37] – [39] below);

(b) A reasonable occupier in the position of the appellant would have considered that there was a not insignificant risk of someone such as Mr Clark missing the top step and falling when the stairs were unlit, and thereby suffering serious injury ([46] – [52]);

(c) A reasonable occupier in the position of the appellant would have responded to this risk by having the automatic light switch adjusted so that the light in the relevant area would remain on at least until after the time of night at which Mr Clark fell ([53] – [59]);

(d) Subject to an express instruction it gave as to the setting of the automatic light switch, the appellant effectively delegated its responsibility for the state of the premises to the Managing Agent ([60] – [72]);

(e) The appellant breached its duty to Mr Clark as the express instruction it had given resulted in the light for the stairs not being on at the time of Mr Clark’s accident ([73]);

(f) Neither the appellant nor the Managing Agent was entitled to claim a reduction in the judgment against it by reason of contributory negligence on the part of Mr Clark as neither made such a claim in address at first instance ([76] – [81]);

(g) By reason of its acceptance of the role of managing agent, the Managing Agent was an occupier of the common property of the premises and as such owed a duty of care to Mr Clark ([82] – [83]);

(h) The Managing Agent breached its duty to Mr Clark by not recommending to the appellant a change to the setting of the automatic light switch ([84] – [86]);

(i) The Managing Agent is not entitled to a contractual indemnity from the appellant ([87] – [90]);

(j) The appellant is entitled to contribution from the Managing Agent under the Law Reform (Miscellaneous Provisions) Act 1946 ([92], [95]);

(k) The Managing Agent is not entitled to make a claim against the appellant for such contribution as it did not make it at first instance or on appeal. It should however be given liberty to apply for leave to seek an order for contribution ([92] – [93]); and

(l) The appellant was 40 per cent and the Managing Agent was 60 per cent responsible for Mr Clark’s accident and consequent injuries ([94] – [96]).

Factual Circumstances

6 From about 2001 or 2002 Mr Rajasuriar operated a photographic store at the premises. Mr Clark was an avid photographer and was accustomed to visiting Mr Rajasuriar’s store two to three times a week for the purpose of producing photographs. He ordinarily arrived at about 6.00pm and stayed for about an hour and a half to two hours. Mr Clark estimated that he used the toilet on the common property of the premises about once a week in the two to three years prior to his accident. He said that he ordinarily did so just after he arrived at around 6.00pm and that there was no occasion prior to 7 June 2004 when the lights in the area giving access to the toilet were not on.

7 To go to the toilet from Mr Rajasuriar’s store it was necessary for Mr Clark to exit the store, go on to the public footpath outside the shopfront and enter the common property of the premises through an adjacent door. Mr Rajasuriar would give Mr Clark the key to open this door. After entering the door Mr Clark would have a short walk to a flight of about eight tiled steps that had a handrail on the left hand side. To access the toilet, he would turn to the right on a landing at the top of the steps, walk across the landing and pass through a doorway into a short corridor at the end of which was the door to the toilet.

8 At about 9.40pm on 7 June 2004 Mr Clark decided to go to the toilet. He entered the common property through the doorway that led from the footpath. There were no lights on in the area in front of him but he said that there was enough light coming from outside for him to see the set of stairs at the end of the area in front of him. It is not clear whether this was because the door to the footpath remained open or because there was light coming through the glass panels that were on the door. He said that he “could see to a point and use my hands to walk up the handrail” (Transcript p 10). He said that he was already aware that there was no light switch in the area because he had been there “hundreds of times” (Transcript p 37). It is not clear why he would have noticed this if the light had been on on all the previous occasions that he had used this toilet.

9 Mr Clark used the handrail as he walked up the stairs. He then crossed the landing and went through the door to the short corridor. There appears to have been some limited lighting in this corridor. The light in the toilet itself was on. After using the toilet he returned to the short corridor and then onto the landing. The door from the short corridor to the landing closed, apparently automatically, after he came through it. Mr Clark said that after this occurred “[t]here wasn’t any light, I couldn’t hardly see, I was trying to reach for the handrail” (Transcript p 11). He said that he could only see shadows and that he “kind of shuffled to the handrail” (ibid). Whilst doing this his foot went over the step and he fell. He agreed in cross-examination that it had been his general experience that “as you move from a light to a dark area that you have to wait a moment before your eyes adjust” and that he had not done so immediately prior to the accident (Transcript pp 41, 43).

10 Mr Mark Huynh, a property manager in the employ of the Managing Agent, gave evidence that the lights in the first area (including the steps and the landing) that Mr Clark entered from the footpath were operated by an automatic light switch that turned the lights out at 6.30pm each evening. Mr Mark Newey, the principal of the Managing Agent, gave evidence that his firm had been the manager of the premises since the building was opened in 1980 and that in that year he had been present when three representatives of the appellant (the “Owner”) gave instructions for the automatic light switch to be set so as to cause the lights in the relevant area to be on only between 8.00am and 6.30pm.

11 One of the representatives to whom Mr Newey referred, Mr Otvosi, gave evidence that he did not recall being involved in the giving of any such instruction. The primary judge however appears to have implicitly accepted Mr Newey’s evidence on this topic when his Honour said that the Owner, “when setting up the lighting situation in the toilet and access area, appears to have set a time clock from approximately 8am I think it was till 6.30pm” (Judgment p 2). Further, in its Written Submissions on appeal, the Owner referred to and relied upon the evidence of Mr Newey quoted in the previous paragraph (Written Submissions [13] and [50]) and did not refer to the evidence of Mr Otvosi. In these circumstances, it is appropriate for this Court to proceed upon the basis that what Mr Newey described did in fact occur.

12 I note in passing that the evidence did not explain the apparent inconsistency between the evidence of Mr Clark that the toilet light was on at about 9.40pm on the night of his accident and Mr Newey’s evidence that the light in the toilet area was timed to go off at 6.30pm. It may be that Mr Newey was mistaken in thinking that the automatic light switch related to the toilet light as well as the light in the area just off the footpath. However nothing turns on this point and it is unnecessary to consider it further.

13 I note also that the evidence at times referred to a single light in the area in which Mr Clark fell and at other times to “lights” in the plural but that the distinction is not of significance to the appeal.

14 Mr Newey gave evidence that after Mr Clark’s accident, Mr Otvosi gave him instructions to change the automatic light switch so that the lights would be on 24 hours each day. Mr Otvosi denied giving these instructions. Nevertheless, whether or not he acted on Mr Otvosi’s instructions, Mr Newey caused the change to be made. This was done. Mr Newey also gave evidence, which was uncontradicted, that he was unaware prior to Mr Clark’s accident of any accidents on the steps or any “complaints or problems with the lighting” (Transcript p 89).

15 Mr Huynh gave evidence that a complaints book that the Managing Agent kept did not contain a record of any complaint about the lighting in the relevant area. The primary judge regarded this evidence as being in conflict with evidence Mr Rajasuriar gave that he complained twice to Mr Huynh prior to the accident in 2004 that “the light” in the area was “out” (Judgment p 6; transcript pp 49 – 50). However, no party suggested on appeal that these complaints, if made, related to the lights being turned off by the automatic light switch, as distinct from the need to replace a light globe. Further, no party suggested that the unlit state of the area at the time of Mr Clark’s accident resulted from a defective globe rather than a light or lights having been turned off earlier by the automatic light switch.

16 Mr Rajasuriar gave evidence that, in the period since 1985 that he had been a tenant at the premises, he had “often” used the toilet after having “stayed [working] for a few hours”, that he had descended the stairs at “night” and that he had not been aware of anybody else “falling” on those stairs (Transcript pp 51, 54). He said that he had “got used” to traversing the stairwell when it was in darkness and that he was not worried about “going upstairs” when the light was off because he was used to it (Transcript p 58). He said that three shops shared usage of the toilet (Transcript p 52).

The Management Agency Agreement

17 The Managing Agent carried on business as a real estate agency and had been the manager of the premises since its construction was completed in 1980. The agency agreement current at the date of Mr Clark’s accident was a written agreement entitled “Management Agency Agreement Commercial and Industrial” and was dated 24 July 1996 (the “Management Agency Agreement”). At the time this agreement was made, the firm managed about 10 properties on behalf of the Owner (Transcript p 65).

18 Clause 2 of the Management Agency Agreement stated that “[t]he Principal [that is, the Owner] hereby appoints the Agent to manage all or any of the premises in accordance with this agreement”.

19 Clause 12 appeared under the heading “Repairs and Maintenance” and was in the following terms:

“The Agent is authorised to arrange repairs and maintenance to be done in accordance with the Principal’s obligation to repair (if any) or as otherwise instructed, or to engage skilled tradesmen to effect repairs and maintenance, provided that expenditure in excess of $2,000.00 for any one item shall not be incurred without the prior approval of the Principal except where it is the Agent’s opinion that because of an emergency, repairs are necessary for the protection of the premises or the supply of essential services to the tenant”.

20 Clauses 15, 16 and 17 were in the following terms:

“Agent’s Indemnity and Liability
15. The Principal will hold and keep indemnified the Agent against all actions, suits, proceedings, claims, costs and expenses whatsoever which may be taken or made against the Agent in the course of or arising out of the proper performance of any of the powers, duties or authorities of the Agent hereunder [the word “proper” appears in the Management Agency Agreement with a line through it].
Agent’s Fees, Charges and Expenses
16. The Agent shall be entitled for provision of all ongoing usual property management services in respect of the premises to a Management Fee of 4% of all monies payable to the Principal collected from time to time. This fee is due and payable by the Principal upon the rendering of Statements of Account by the Agent.
17. The Agent as occasion requires from time to time shall perform the following other services other than in connection with the leasing and management of the premises or any part thereof and shall be entitled to remuneration as follows in the event that those services are performed as undertaken.

Service	Fee	When due and Payable
Negotiation of a rent variation	NIL	NIL
Attendance as a witness in Court	$75.00 PER HOUR	AFTER ATTENDANCE
Service of a Notice of Summons	NIL	NIL
Attending and obtaining a summons	COSTS ONLY	AFTER ISSUE
Laying information for ejectment	$75.00 PER HOUR	AT TIME OF GIVING INFORMATION
Arrangement/supervision of repairs	NIL	NIL
Collection of outgoings from tenants	4%	AFTER COLLECTION”.

The Judgment at First Instance

21 The primary judge said the following about the knowledge of the Managing Agent that tenants were in the premises after hours:

“The [Owner] makes the point that both Mr Huynh and Mr Newie [sic] knew that tenants were there after hours. I think both of them actually deny that they were aware that it was a regular occurrence or anything like that, indeed particularly Mr Newey denied that he ever knew of anybody being there after hours but I think that it follows as night follows day that it would be perfectly foreseeable that such tenants would be and that they may not be alone and I repeat, that I see no difference anyway between the position of [Mr Clark] and the position of his host, who was actually a tenant in the premises. Both of them were required to negotiate this particular passage after 6.30[pm] in darkness” (Judgment pp 4-5).

22 These findings were not challenged on appeal.

23 The judge expressed his conclusion concerning the Owner’s liability as follows:

“It is my view that [Mr Clark] has established clear negligence against the [Owner] to have a lighting system that not only presents no lighting after 6.30[pm], but also denies a potential user of the toilet any opportunity to correct that situation by reason of the fact that there are no switches. That creates a situation that, as the amended statement of claim says, exposed [Mr Clark] to a situation of peril” (Judgment pp 5-6).

24 In relation to the liability of the Managing Agent the primary judge said:

“I am of the view that exhibit 1 and indeed the nature of the evidence from the various parties would exclude any liability in the [Managing Agent] to [Mr Clark]. The [Managing Agent] was not burdened with the management and control of these premises and it is quite erroneous in my view to suggest that the [Owner] effectively delegated control of the premises to [the Managing Agent]. The reasons for that are set out very largely in the written submissions of the [Managing Agent]. There is virtually not a paragraph of those submissions with which I would disagree, except insofar as some submissions are made in relation to the evidence of Mr Rajasuriar” (Judgment p 6).

25 In the written submissions to which the judge referred the Managing Agent contended that it was appointed only to do specific tasks and that it did not owe a duty of care to Mr Clark as an occupier because it was not in a relationship with him. It submitted that its duties to the Owner did not extend beyond its obligations under the Management Agency Agreement. It said that the Owner, and not it, had the responsibility to take reasonable care to keep the premises safe. It argued that it had no responsibility to change the automatic light switch or to give advice or recommendations to the Owner and that the Owner was obliged to indemnify it completely against any liability to pay damages and costs.

26 The reference made in the passage extracted in [24] above to the evidence of Mr Rajasuriar was to the evidence he gave of complaints that he made to Mr Huynh that were not subsequently recorded in the Managing Agent’s complaint book (see [15] above). The judge said that he was not able to say which witness was correct, as a result of which he concluded “that [Mr Clark] has not established, on the relevant onus, that there were any prior complaints made” (Judgment p 6). This conclusion is not challenged on appeal.

27 The effect of the judge’s findings quoted in [23] – [24] above was, first, that the Owner had not been able to avoid the conclusion that it had breached a duty of care owed by it to Mr Clark by showing that it had effectively delegated performance of its duties as occupier to a competent agent and, secondly, that the Managing Agent had not assumed responsibility for the safety of the premises in such a way as to give rise to a duty of care owed by it to Mr Clark.

28 The judge’s findings led him to direct that a judgment for damages be entered in favour of Mr Clark against the Owner and that judgment be entered in favour of the Managing Agent in the proceedings brought against it by Mr Clark. The judge assessed the damages to which Mr Clark was entitled from the Owner as $160,000. However it was agreed on appeal that there was an error in his Honour’s calculations and that the amount of any judgment for damages against the Owner or Managing Agent should be $120,064.12.

Issues on Appeal

29 The issues that the parties argued on the appeal were effectively as follows.

30 First, whether the primary judge erred in his findings as to the nature of the duty of care that the Owner owed to Mr Clark.

31 Secondly, whether the Owner was in breach of the duty of care that it owed to Mr Clark. This issue extended to the question of whether the Owner had delegated responsibility for performance of its duty to a competent agent, namely the Managing Agent.

32 Thirdly, whether the Owner and the Managing Agent were entitled to complain on appeal that the primary judge had not considered the question of contributory negligence and, if so, whether Mr Clark had been contributorily negligent.

33 Fourthly, whether the Managing Agent had been appointed to, and had assumed, a role in managing the premises that gave rise to a relevant duty of care owed by it to Mr Clark.

34 Fifthly, whether the Managing Agent breached any such duty of care that it owed.

35 Sixthly, whether cl 15 of the Management Agency Agreement (see [20] above) entitled the Managing Agent to indemnity from the Owner in respect of any liability that the Managing Agent had to Mr Clark.

36 I shall deal with each of these issues in turn.

Duty of Care owed by the Owner to Mr Clark

37 The part of the premises in which Mr Clark’s accident occurred was not leased by the Owner. Rather, it formed part of the common property of the premises. On the appeal, the parties accepted that the Owner was the occupier of this part of the premises. Mr Clark’s entry into the area was lawful because, as the parties also accepted, the tenant and those visiting his store were authorised by the Owner to have access to the toilet and, of necessity, the common property that a person needed to traverse to get to the toilet.

38 In these circumstances the Owner owed to Mr Clark a duty to take reasonable care to avoid a foreseeable risk of injury to him (Australian Safeway Stores Pty Ltd v Zaluzna [1987] HCA 7; (1986-1987) 162 CLR 479 at 488). The extent of the obligation of an occupier is that of an occupier exercising reasonable care to prevent injury to an entrant “using reasonable care on his part for his own safety” (Roads and Traffic Authority of New South Wales v Dederer [2007] HCA 42; (2007) 234 CLR 330 at 345 – 346 [45] quoting Indermaur v Dames (1866) LR 1 CP 274 at 288). As indicated in the plurality judgment in Thompson v Woolworths (Q’Land) Pty Ltd [2005] HCA 19; (2005) 221 CLR 234, “the weight to be given to an expectation that the other [person] will exercise reasonable care for his or her own safety is a matter of factual judgment. It may depend on the circumstances of the case” (at [35]).

39 The Owner submitted that the primary judge made the error identified in RTA v Dederer (at [49] – [51]) of treating the relevant duty as effectively a strict one “to prevent harm occurring” to Mr Clark as distinct from one to exercise reasonable care to avoid a foreseeable risk of injury to Mr Clark. There is no clear statement of the relevant duty of care in his Honour’s judgment but, reading the judgment as a whole, it seems to me that he was correctly treating the Owner’s obligation as one to exercise reasonable care rather than as one of, in effect, strict liability.

Breach by the Owner of its Duty of Care

The Civil Liability Act 2002

40 To establish a breach of the duty of care that the Owner owed Mr Clark, it was necessary for Mr Clark to demonstrate that the “three preconditions” (cf Roads and Traffic Authority of NSW v Refrigerated Roadways Pty Ltd [2009] NSWCA 263; (2009) 53 MVR 502 at [173]) to liability for negligence for failing to take precautions against a risk of harm specified in s 5B of the Civil Liability Act 2002 (the “Act”) had been satisfied. Section 5B is in the following terms:

“ 5B General principles
(1) A person is not negligent in failing to take precautions against a risk of harm unless:
(a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and

(b) the risk was not insignificant, and

(c) in the circumstances, a reasonable person in the person’s position would have taken those precautions.
(2) In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things):

(a) the probability that the harm would occur if care were not taken,

(b) the likely seriousness of the harm,

(c) the burden of taking precautions to avoid the risk of harm,
(d) the social utility of the activity that creates the risk of harm”.

41 The Owner contended that the primary judge’s conclusion that it was in breach of a duty owed by it to Mr Clark was vitiated by the judge’s failure to refer to the Civil Liability Act or, specifically, the preconditions contained in s 5B(1). The parties acknowledged that the Civil Liability Act had not been referred to by the parties in their submissions below.

42 In cases to which the Civil Liability Act applies, it is in my view important that a trial judge refers to its provisions to ensure that he or she adheres to it in his or her reasoning and that such adherence is apparent to an appellate court. Nevertheless I do not consider that the absence of such a reference in a judge’s decision is sufficient on its own to establish that such a decision is erroneous. It will suffice in my opinion if it is apparent that the judge has addressed and determined the issues that the Civil Liability Act requires be addressed and determined. This view is consistent with the approach of this Court in Doubleday v Kelly [2005] NSWCA 151 (at [15]) and Roads and Traffic Authority of NSW v Refrigerated Roadways Pty Ltd (at [444] – [445]). The observation in Adeels Palace Pty Ltd v Moubarak [2009] HCA 48; (2009) 239 CLR 420 that “[t]he absence of consideration at trial of the matters prescribed by s 5B of the Civil Liability Act may have been reason enough to conclude that the question of breach of duty was not determined by the trial judge” (at [39]) does not suggest that a contrary conclusion is required, as it was directed to the absence of consideration of the matters prescribed by s 5B, and not to the absence of express reference to that section, as being a potentially vitiating factor in a trial judge’s decision.

43 In any event, there is no reason why in the present case this Court should not consider whether the requirements of s 5B were met, to the extent that the primary judge may not have done so. As such consideration would not require the resolution of any factual issues the primary judge did not determine, this Court is in as good a position as his Honour was to determine the issues raised.

44 Because the “preconditions” in s 5B (see [40] above) closely, although not exactly, mirror the steps to be taken to determine under the general law (see especially Wyong Shire Council v Shirt [1980] HCA 12; (1980) 146 CLR 40 at 47 – 48) whether a breach of a duty of care has occurred, a conclusion that those requirements have been satisfied will almost inevitably lead to the conclusion that a breach of the relevant duty of care has occurred. That is so in the present case.

45 I shall refer to the three requirements of s 5B(1) in turn.

Foreseeability of the Risk: s 5B(1)(a)

46 The primary judge did not make any clear finding as to the foreseeability of the risk of injury to Mr Clark, although the view that it was foreseeable appears to be implicit in his judgment. For the reasons given under the next heading, my view is that that risk was foreseeable. The Owner virtually conceded as much in saying in its Written Submissions that “a risk of injury through stumbling in the dark might in a general sense be foreseeable” (Written Submissions [35]).

Whether the risk was “not insignificant”: s 5B(1)(b)

47 The Owner submitted that “it is impossible to say that the risk here was not insignificant bearing in mind there had been no previous accident and, importantly, bearing in mind that the plaintiff found his way to the toilet in the available light without mishap” (Written Submissions [35]).

48 Again, the primary judge did not make a clear finding on this point. However, my view is that the foreseeable risk here was “not insignificant”. As stated by Heydon JA (as he then was) in Wilkinson v Law Courts Ltd [2001] NSWCA 196 “[s]tairs are inherently, but obviously, dangerous” (at [32]). Where, as here, the stairs are internal ones that are not lit at times that it should be expected that persons may use them (see [21] – [22] above), the risk of someone missing a step in the dark and falling must in my view be regarded as a “not insignificant” one. The danger resulting from the absence of lighting of steps was recognised by this Court in Penrith Rugby League Club Ltd trading as Cardiff Panthers v Elliot [2009] NSWCA 247 (see [25]) and Stojan (No 9) Pty Ltd v Kenway [2009] NSWCA 364 (see [129], [133]).

49 Whilst the danger of falling on the steps was one that should have been obvious to someone, such as Mr Clark, returning from the toilet when the relevant area was unlit, it was a danger with which Mr Clark had only limited means of dealing, that is, by shuffling across the landing in the manner he did or perhaps by following the wall around with his hands. Further Mr Clark’s evidence did not suggest that when he ascended the stairs, having then enough light to locate the handrail at the bottom of the flight of stairs, he appreciated, or should reasonably have appreciated, the extent of the difficulty he would have in seeing the handrail at the top of the flight of stairs when he entered the landing from the corridor door on his return. This is especially so given that he had apparently not previously visited the bathroom when the area was unlit (see [6] above).

50 The danger presented by the unlit stairs was one that should have been obvious to a reasonable occupier in the position of the Owner. The fact that the danger of the unlit stairs would have been obvious to persons returning from the toilet did not in my view absolve the Owner from taking precautions because users of the unlit stairs could not, for the reasons just given, reasonably avoid the danger facing them (see Francis v Lewis [2003] NSWCA 152 at [53] – [54]).

51 Even if, as the Owner contended in its submissions on appeal concerning contributory negligence, Mr Clark did not exercise reasonable care in attempting to negotiate the landing and to find the handrail, it would not follow that no duty was owed to him by the Owner (RTA v Dederer at [47]) and, therefore, that the Owner could not be in breach of such duty. In the statutory context now under consideration, the relevant question is whether there was a “not insignificant” risk of injury to someone who was exercising reasonable care (see [38], [40] above). In a situation, as here, where a person using the toilet at night would come out of a lighted area into a darkened one – a state of darkness over which Mr Clark had no control before or after visiting the toilet – and have to find his or her way over a number of feet of landing to grasp a handrail which commenced adjacent to the top step of a flight of stairs, there was in my view a not insignificant risk that even a person being careful might miss the step and/or the handrail, and fall.

52 The fact that there had been no previous accident is a relevant consideration but does not in my view dictate a conclusion that any risk was insignificant, particularly when there was no evidence about how frequently the toilet had been used in the past after 6.30pm (compare [21] above). Further, the fact relied upon by the Owner (see [16] above) that the respondent had “found his way to the toilet in the available light without mishap” is not of significance. That there was enough light for Mr Clark, when entering the area on the ground floor, to identify the beginning of the stairs and the handrail does not mean that there was sufficient light for him, when approaching the stairs and handrail from the landing at right angles to the top of the stairs and handrail, to identify readily where the stairs and handrail began. Indeed, Mr Clark’s evidence that he could see only shadows and had to shuffle across the landing (see [9] above) was not challenged in cross-examination. Rather, the gravamen of the cross-examination was the suggestion made by the cross-examiner that after he entered the landing Mr Clark could have waited (but did not wait) for his eyes to adjust to the darkness in the area, not that he could in fact see where he was going.

Precautions that a reasonable person would have taken: s 5B(1)(c)

53 Once again the primary judge did not in terms address this issue although it is clear that he thought that it was unreasonable for the Owner not to have provided lighting, or at least the opportunity to switch on a light to illuminate the area (Judgment pp 5-6). The judge did not address the matters that s 5B(2) requires to be considered. I accordingly proceed to do so.

54 The evidence that no accident had previously occurred in my view suggests that “the probability that the harm would occur if care were not taken” (see s 5B(2)(a)) was low, even though it was “not insignificant”. On the other hand if an accident did occur there was a real prospect that it would occur as the result of someone who was descending missing the top step with his or her foot before grasping or attempting to grasp the handrail and that the person would fall down a number of tiled steps with a substantial risk of serious injury being suffered thereby arising (see s 5B(2)(b)).

55 The “burden of taking precautions to avoid the risk of harm” (see s 5B(2)(c)) was not great. This was demonstrated by the fact that after Mr Clark’s accident the automatic light switch for the light in the area was changed, without any apparent difficulty or great expense, so that the relevant light would be on 24 hours each day (see [14] above). For a reason that was not obvious from the evidence, an electrician had to be called to do this. However, the expense of engaging an electrician for this purpose could not be regarded as a significant one.

56 The Owner submitted that the Court could not find that a reasonable person in the position of the Owner would have taken any precautions to guard against the relevant risk of injury because there was no evidence as to the feasibility of having “an automatic timer system which would operate efficiently and effectively with some kind of override switch located at one or more places in the corridor” (Written Submissions [38]). It submitted that this was a matter for expert evidence and that there was none. However, this system, that the Owner described as “a hybrid situation” (ibid), was only one possible response to the foreseeable risk. Another response, which was an obvious one and which was not burdensome was to change the automatic light switch, as occurred after the accident (see [14] above).

57 It may be that a reasonable occupier would have thought it extremely unlikely that retail or commercial tenants (or a visitor of one of those tenants) would be at their premises and use the toilet after, say, midnight. The occupier might then have considered it unnecessary to have the light on 24 hours a day and might reasonably have decided to have it turn off at midnight. In any event, the cost of the electricity required to power the light for an additional twelve hours per day, or perhaps five and half hours on the hypothesis that the light was turned off at midnight, if necessary using a low wattage bulb, could not be regarded as a significant expense in the context of substantially reducing, if not avoiding, the risk of persons falling and injuring themselves on otherwise unlit tiled stairs. I conclude therefore that evidence of the cost of adopting the “hybrid” solution to which the Owner referred was unnecessary and that a reasonable person in the Owner’s position would at least have taken the precaution of extending to midnight the period that the light was on.

58 Section 5B(2)(d) requires consideration of the “social utility of the activity that creates the risk of harm” (see [40] above). The only possible social utility of not lighting the stairs would be the saving of the electricity required to power a light. Whilst economy in the use of electricity is to be encouraged, any saving of this nature is not of significance in the present context, involving, as it did, the risk of serious injury to persons such as Mr Clark (see [54] above).

59 As the “preconditions” stated in s 5B of the Act have been satisfied and the almost identical requirements identified in Wyong Shire Council v Shirt have in my view been similarly satisfied, Mr Clark has, subject to the issue of any delegation of responsibility (to which I will now turn), established a breach of the duty of care owed to him by the Owner.

Whether the Owner delegated performance of its duty

60 Mr Clark did not contest the Owner’s submission that the Owner’s duty of care was delegable, that is, that it was open to the Owner to perform its duty of care by engaging a competent contractor to fulfil the Owner’s duty to Mr Clark (see the discussion of this point in Jones v Bartlett [2000] HCA 56; (2000) 205 CLR 166 at [190] – [194]). As a result, the issue between the parties was whether such a delegation had in fact occurred. Mr Clark denied that it had and, presumably because a finding that it had would almost inevitably result in a finding that the Managing Agent owed a duty of care to Mr Clark, so did the Managing Agent.

61 Mr Clark’s position concerning delegability reflected the conclusion expressed by Hodgson JA (with the concurrence of Gyles AJA and Nicholas J) in Bevillesta Pty Ltd v Liberty International Insurance Co [2009] NSWCA 16 as follows:

“53 There is no doubt also that this occupier’s duty of care is ‘delegable’, in the sense that it may be discharged in whole or in part by the occupier’s exercise of reasonable skill and care in engaging someone else to take steps to keep the property safe either generally or in particular respects. Discharge of the duty in this way requires reasonable skill and care in the selection of the other person, in arranging the terms of engagement of that person, and in confirming that the person does take appropriate steps. If it is reasonable for an occupier to seek to discharge or partly discharge the occupier’s duty in this way, and the occupier does exercise reasonable skill and care in all these respects, then if a person coming on to the property is injured due to the failure of the other person engaged to exercise reasonable skill and care to keep the property safe, the occupier may escape liability”.

62 In my view, subject to the qualification referred to in [73] below, the Owner did delegate its duty of care to the Managing Agent. By cl 2 of the Management Agency Agreement the Owner appointed the Managing Agent “to manage all or any part of the premises in accordance with this agreement” (see [18] above). The breadth of that appointment was emphasised by cl 16, which referred to the Managing Agent providing “all ongoing usual property management services in respect of the premises” (see [20] above). That those services extended beyond activities in connection with the leasing of the premises was made clear by cl 17, which distinguished between “leasing” and “management” services. In my view the concept of “management of the premises” extended to the taking of, or recommending that the Owner take, reasonable steps to have the premises fit for the purpose for which they were used, namely, as a small retail and commercial complex. They would not be fit for that use if they were not safe for the use.

63 That the Managing Agent’s obligations extended to matters of this character is confirmed by reference to cl 12, which authorised the Managing Agent to incur expenditure not exceeding $2000 (except in the case of emergency) in respect of “repairs and maintenance”. The terms of this clause (as to which see [19] above) in my view assumed the Managing Agent would oversee the premises and would make recommendations to the Owner where work was required to be done (unless it could be done within the Agent’s limit of expenditure) to maintain the premises.

64 Mr Clark submitted that a change in the lighting arrangement in the area in which he fell was not embraced by the concept of “repairs and maintenance”. I do not agree. As was evident from what occurred after his accident, all that was required was a simple change to the timing set on the automatic light switch (see [14] above).

65 I do not consider that characterisation of an act as one of “maintenance” requires a detailed examination of the condition of the premises at the outset of the period in question (here the date of the Management Agency Agreement) to ascertain whether in strict terms the act is designed to keep the premises in the condition that they were in at that point of time or alternatively whether it involves some change or improvement, however limited that might be. The appropriate general approach to the concept “maintenance” is in my view to be found in the following observation of Jessel MR in Sevenoaks, Maidstone and Tunbridge Railway Co v London Chatham and Dover Railway Co (1879) 11 Ch D 625, albeit that it was made in a different context:

“[Y]ou may maintain by keeping in the same state, or you may maintain by keeping in the same state and improving the state, always bearing in mind that it must be maintenance as distinguished from alteration of purpose” (at 635).

See also Sattel v The Proprietors – Be Bees Tropical Apartments Building Units Plan No 71593 (No 2) [2001] QCA 560; [2002] 2 Qd R 427 at [67] – [68].

66 Another analogous approach is to be found in Proprietors – Strata Plan 30234 v Margiz (1993) 32 NSWLR 294 where McLelland CJ in Eq said of the phrase “good and serviceable repair” in the Strata Titles Act 1973:

“Although the duty … to keep the common property in the state of good and serviceable repair extends to making elements of the common property good and sound irrespective of whether they were good and sound at some earlier time … that does not in my opinion extend to replacement of a discrete system forming part of the common property … by a new or different system” (at 297).

See also Ridis v Proprietors of Strata Plan 10308 [2005] NSWCA 246 at [168] – [170].

67 Thus I consider that setting the automatic light switch in an appropriate way fell within the concept of “maintenance” because it would have made an aspect “of the common property good and sound”, by improving its safety, without altering its purpose as a type of thoroughfare to various places in the premises. The concept of “maintenance” was undoubtedly within the ambit of the duties of the Managing Agent. In any event, even if the setting of the automatic light switch fell outside that concept, it was in my view nevertheless part of the duties of the Managing Agent as “manager” of the premises (see cl 2 of the Management Agency Agreement) to attend to that simple, but important, matter.

68 By the Management Agency Agreement the Owner accordingly engaged the Managing Agent to, amongst other things, take reasonable care to have the premises safe for use. This obligation extended to taking reasonable steps to provide, or recommend the provision of, adequate lighting in the area in which Mr Clark fell, and in and about other parts of the premises.

69 As is evident from the passage from Bevillesta quoted in [61] above, to have effectively delegated responsibility the occupier must have exercised “reasonable skill and care in the selection of the [delegate], in arranging the terms of the engagement of that person, and in confirming that the person does take appropriate steps”. Generally, the plaintiff (in this case, Mr Clark) has the onus of proving his or her case on the balance of probabilities. However if, as here, the plaintiff proves in an action against the occupier that reasonable care has not been taken to render premises safe for use by the plaintiff, it is in my view unnecessary for the plaintiff to negative delegation by the occupier of its responsibility to take reasonable care for the safety of the plaintiff unless the occupier has introduced evidence suggesting that this may have occurred. Thus, as I see it, there is an evidentiary onus on the occupier to lead some evidence of any suggested delegation.

70 The Owner discharged this onus in the present case as it tendered the Management Agency Agreement and because there was also evidence before the Court that the Managing Agent had had considerable experience in managing properties, had done so for the Owner on an extensive basis and had the practice of recording and acting upon complaints made concerning the premises.

71 The evidence to which I refer is as follows. The Managing Agent carried on business as a real estate agency and had been manager of the premises since about 1980 (Transcript p 86). When the parties entered the Management Agency Agreement in 1996 the Managing Agent managed “ten or so properties” that were then owned by the Owner (Transcript p 65). Cleaners attended at the premises three times a week and had instructions to change any light globes that they found to have “blown” (Transcript pp 73-74). The Managing Agent kept a “repair book” in which it recorded complaints made in connection with the premises. It arranged to have tradesmen attend to matters that were the subject of complaints and it recorded the action taken in the repair book (Transcript pp 74–75). The Managing Agent also managed other commercial properties at the time of Mr Clark’s accident (Transcript p 77).

72 It can be inferred from this evidence that, by the time of Mr Clark’s accident, the Managing Agent had had considerable experience in property management and had satisfactorily managed properties for the Owner over a long period of time. When taken with the terms of the Management Agency Agreement, this evidence was in my view enough to discharge the evidentiary onus that lay upon the Owner to show the reasonableness of its delegation. Further the evidence was such in my view as to obviate the need for any specific evidence that the Owner confirmed that the Managing Agent from time to time took the “appropriate steps” to which Hodgson JA referred in Bevillesta (see [61] above). As there was no evidence to which Mr Clark could point to suggest that the Owner’s delegation was not made reasonably to an apparently competent agent, the conclusion should be reached that it was, subject to the important qualification to which I now come.

The Owner’s instruction in relation to the automatic light switch

73 The qualification to which I refer is that the general delegation that the Owner made to the Managing Agent to manage the premises was implicitly subject to any express instructions that the Owner might give in respect of the management of the premises. The terms of cl 12 of the Management Agency Agreement (see [19] above) suggest that this was so. As indicated in [11] above, the Owner gave an instruction in 1980 about how the automatic light switch was to be set. No change was made to this instruction until after Mr Clark’s accident. It was accordingly operative when that accident occurred. Notwithstanding that in a general sense the Owner had delegated management of the premises to the Managing Agent, the state of the lighting in the relevant area at the time of Mr Clark’s accident was, because of this instruction, something for which the Owner itself had some responsibility. The Owner’s general delegation of management responsibility to the Managing Agent cannot absolve it of responsibility for the state of the premises to the extent that such a state reflected its express instructions. Whether the Managing Agent also bears some responsibility for failing to recommend a change in the manner in which the area in which Mr Clark’s accident occurred was lit is a matter to which I will come below. However, I consider that at least to some extent the general delegation of responsibility to the Managing Agent to take reasonable care to keep the premises safe was relevantly qualified by the Owner’s express instruction.

Causation and Quantum of Damages

74 The Owner did not contend that if, contrary to its primary submissions, it had breached its duty of care to Mr Clark, that such a breach did not cause or materially contribute to the injuries suffered by Mr Clark.

75 The quantum of the damages that the primary judge awarded was not in issue on appeal although, as pointed out in [28] above, the parties agreed that his Honour made an error in his calculations.

Contributory Negligence

76 Both the Owner and the Managing Agent pleaded in their defences that Mr Clark had been guilty of contributory negligence because he failed to take reasonable care for his own safety.

77 The primary judge did not however make any mention of these defences in his judgment. This was not surprising as none of the parties made any reference, at least in express terms, to the issue in their addresses. Mr Clark submitted that in these circumstances the Owner and Managing Agent should not be permitted to contend on appeal that any damages to which Mr Clark was otherwise entitled should be reduced by reason of contributory negligence on his part.

78 The Owner responded by submitting that it had in fact addressed the issue, although it conceded that it did not at any stage use the term “contributory negligence”. The passages of the transcript of argument to which the Owner referred in support of this submission were however in my view ones recording submissions concerned only with the Owner’s duty and breach of duty and not contributory negligence on the part of Mr Clark. Certainly the Owner criticised Mr Clark’s conduct in not waiting until his eyes adjusted to the dark before attempting to reach the stairs but it did so in the context of implicit assertions that the Owner did not owe a duty, or did not breach a duty, to a plaintiff who did not take reasonable care for his own safety (see the principles referred to [38] above). The Owner did not expressly or impliedly contend that if the Owner were found to be negligent, the judge should make a finding of contributory negligence on the part of Mr Clark. Nor did the Managing Agent submit that Mr Clark had been contributorily negligent.

79 The result was that the primary judge did not express a view as to whether there was any contributory negligence on the part of Mr Clark and the position is not in my view capable of being remedied by this Court making a finding as to contributory negligence and apportionment of damages between Mr Clark on the one hand and the Owner and Managing Agent on the other. A finding of that type is an evaluative one involving a significant degree of subjectivity, a “weighing [of] different considerations” and “individual choice or discretion” (Podrebersek v Australian Iron and Steel Pty Ltd (1985) 59 ALJR 492 at 494 citing British Fame (Owners) v Macgregor (Owners) [1943] AC 197 at 201). Mr Clark was entitled to have the primary judge express a view about the issue if the defendants relied upon that defence. If his Honour had done so, the ability of the Owner and the Managing Agent to have that decision reviewed on appeal would have been limited (see for example Podrebersek at 494; Joslyn v Berryman [2003] HCA 34; (2003) 214 CLR 552 at [157] per Hayne J; Costa v Public Trustee of NSW [2008] NSWCA 223 at [18(3)], [40] – [41] and [103]). In consequence of the Owner and Managing Agent not arguing the point at first instance, Mr Clark has in my view been denied the opportunity of obtaining an evaluative decision of the primary judge that one cannot assume would be the same as that at which this Court would arrive. Mr Clark has to this extent been prejudiced. As a consequence I do not consider that it is in the interests of justice that the Owner and the Managing Agent be permitted to raise the matter for the first time on appeal.

80 This conclusion is consistent with the following principle stated by Mason P (with the concurrence of Gleeson CJ and Priestley JA) in Multicon Engineering Pty Ltd v Federal Airports Corporation (1997) 47 NSWLR 631:

“A party does not have a right to insist that a new point be decided on appeal simply because all of the facts have been established beyond controversy or the point is one of construction or of law, even constitutional law. This is because it remains a question of whether the appellate court ‘may find it expedient and in the interests of justice to entertain the point’: Water Board v Moustakas (1988) 180 CLR 491 at 497; see also Jones v Minister for Immigration and Ethnic Affairs (1995) 63 FCR 32 at 47” (at 645).

81 The following observation made by the Victorian Court of Appeal in Chen v Chan [2008] VSCA 280 is also apposite:

“42 Pleadings set the scene by which the trial is to take place. They ensure fair play and delineate the issues for the purpose of the trial. It is in this context that Appellate Courts have regard to the pleadings. They do not enable a party to maintain a new contention on appeal where the trial has been conducted on a different basis. It is simply not open to a party to assert on appeal that, provided that the matter was contained within the pleadings, it is then permissible to argue that point unless it truly arose as an issue for determination by the trial judge having regard to the manner in which the trial was conducted”.

Liability of the Managing Agent

82 Subject to the effect of the 1980 instruction of the Owner concerning the automatic light switch, the Management Agency Agreement placed responsibility on the Managing Agent to exercise care in relation to the safe condition of the premises. Whilst the Management Agency Agreement was not necessarily determinative of the nature of the relationship between Mr Clark (as distinct from the Owner) and the Managing Agent it was a relevant circumstance in determining whether the Managing Agent owed a duty of care to Mr Clark (Voli v Inglewood Shire Council [1963] HCA 15; (1962-1963) 110 CLR 74 at 85 per Windeyer J). However, if such a duty was cast upon the Managing Agent, that occurred, “not because [it] made a contract, but because [it] entered upon the work” (ibid). Here the Managing Agent “entered upon the work” by acting as managing agent of the premises in accordance with the Management Agency Agreement. That in my view gave rise to a duty of care that the Managing Agent owed Mr Clark of a similar character to that referred to in [38] above. The Managing Agent had a sufficient degree of control over the premises to warrant its classification as an occupier (Wheat v E Lacon & Co Ltd [1966] AC 552 at 589 – 590; Jones v Bartlett especially at [150]; Stojan (No 9) Pty Ltd v Kenway at [82] – [83]). Because of the nature of the role that the Managing Agent assumed, the Managing Agent may have been able in some circumstances to discharge that duty by making appropriate recommendations to the Owner concerning steps that should be taken by the Owner in connection with the safety of the premises. No relevant recommendations were given in the present case.

83 The creation of a duty of care in this manner was described by Hodgson JA (with the concurrence of Gyles AJA and Nicholas J) in Bevillesta as follows:

“54 In my opinion, a corollary of this is that a person engaged in this way may come under a duty of care to persons coming on to the property. If that person knows or reasonably should know that he or she has been engaged to keep the property safe for persons coming on to it (and the exercise of reasonable skill and care by the occupier would require that this be conveyed to that person), then in my opinion the person so engaged would appreciate that if he or she does not exercise reasonable skill and care, there is a risk of injury to persons coming on to the property; and the person’s understanding of that engagement and risk gives rise to a relationship with persons coming on to the property sufficient to support a duty of care”.

84 However, the obligation that the Managing Agent would otherwise have had to identify, and respond to, the potentially dangerous situation existing in the area where Mr Clark fell after the light went off each day at 6.30pm was lessened by the express instruction from the Owner described in [11] above.

85 A reasonable person in the Managing Agent’s position would have been entitled to regard this instruction as one given after the Owner had considered the appropriateness of the light being turned off in the area each night at 6.30pm. Nevertheless by the time of Mr Clark’s accident in 2004 the instruction of 1980 had become a very old one. Although there had been no reports of accidents on the stairs, the Managing Agent should in my view have recognised that there was a not insignificant risk of someone suffering serious injury by falling on the stairs when they were unlit after 6.30pm and should have responded to that risk by recommending to the Owner that the light be kept on until much later in the evening or be kept on 24 hours per day.

86 In light of the simple change that was made to the automatic light switch after Mr Clark’s accident, it was more probable than not that if the potentially dangerous situation had been brought to the attention of the Owner before the accident, the necessary simple change to the automatic light switch would have been made at that time and the light would have been on when Mr Clark visited the toilet on 7 June 2004. The consequence is that Mr Clark’s injuries were caused or materially contributed to by the Managing Agent, as well by the Owner.

The Managing Agent’s Contractual Indemnity Claim

87 The Managing Agent claimed that cl 15 of the Management Agency Agreement (see [20] above) entitled it to indemnity from the Owner in respect of any liability it might have to Mr Clark, including for costs, and in respect of any costs it might incur in connection with Mr Clark’s proceedings.

88 The decision in Andar Transport Pty Ltd v Brambles Ltd [2004] HCA 28; (2004) 217 CLR 424 confirms that contractual indemnities are to be construed strictly. In that case, the plurality concluded that the principles applicable to the construction of guarantees are relevant to the construction of indemnity clauses including the following statement of principle the plurality in Ankar Pty Ltd v National Westminster Finance (Australia) Ltd [1987] HCA 15; (1986-1987) 162 CLR 549 made in connection with the construction of guarantees:

“At law, as in equity, the traditional view is that the liability of the surety is strictissimi juris and that ambiguous contractual provisions should be construed in favour of the surety. The doctrine of strictissimi juris provides a counterpoise to the law's preference for a construction that reads a provision otherwise than as a condition. A doubt as to the status of a provision in a guarantee should therefore be resolved in favour of the surety” (at [17] citing (1987) 162 CLR 549 at 561).

89 Clause 15 is concerned with the “performance” of the powers, duties or authorities of the Managing Agent. The Managing Agent’s breach of duty in the present case constituted a failure to perform, not a performance of, its duties under the Management Agency Agreement. Bearing in mind the strict approach to construction that is appropriate in these circumstances, the conclusion follows that cl 15 is inapplicable and does not entitle the Managing Agent to the indemnity it claims.

90 I add that I do not consider that the word “proper” that appears with a line through it in cl 15 assists the Managing Agent. Even if, which I think not to be the case, an inference could be drawn about the parties’ intentions from the fact that the word had been deleted (see for example as to the relevance of deleted words, MCA International BV v Northern Star Holdings Ltd (1991) 4 ACSR 719 at 724 – 725), the fact that the clause only applies where there is a relevant “performance” of the Agreement would not be affected. Thus the indemnity would still not apply to a failure to perform such as occurred here.

Apportionment of Responsibility between Owner and Managing Agent

91 It follows from what I have said in [73] and [86] above that breaches by both the Owner and Managing Agent of duties of care that they owed to Mr Clark caused or materially contributed to the injury suffered by Mr Clark. Accordingly Mr Clark is entitled to judgment against each of them for the full amount of his loss.

92 It is then necessary to consider the position as between the Owner and the Managing Agent. In its cross claim at first instance, the Owner sought contribution from the Managing Agent pursuant to the provisions of s 5 of the Law Reform (Miscellaneous Provisions) Act 1946 (the “Law Reform Act”). Further, the Owner included a claim for a contribution order in its Amended Notice of Appeal. On the other hand, the Managing Agent did not seek such an order against the Owner, at first instance or on appeal. Its claim for indemnity from the Owner contained in its cross claim at first instance and in its Notice of Contention on appeal was based solely upon cl 15 of the Management Agency Agreement. I have earlier rejected the claim for indemnity made on this basis (see [89] above).

93 In these circumstances, I do not consider that it is appropriate to make any order for contribution in favour of the Managing Agent under the Law Reform Act without giving the Owner the opportunity to be heard on the issue. As the amount of contribution to which the Managing Agent would be entitled from the Owner is identified in the views I express below as to the respective responsibilities of the Owner and Managing Agent and as a claim for indemnity was in fact made by the Managing Agent against the Owner, albeit on a different basis, I propose that the Managing Agent be given leave to apply within fourteen days of this judgment for an order for contribution and for appropriate amendments to its court documents.

94 Section 5 of the Law Reform Act entitles a tort-feasor to recover contribution from any other tort-feasor for such amount “as may be found by the court to be just and equitable having regard to the extent of [the latter’s] responsibility for the damage” (ss 5(1) and (2)).

95 I have identified earlier the manner in which the Owner and Managing Agent breached their duties of care (see [57], [73] and [85] above). In my view, the Owner bears a significant degree of responsibility for Mr Clark’s injuries. The Owner’s express instructions led to the creation of the situation that ultimately resulted in Mr Clark’s fall. Being the proprietor of the premises, and the occupier of the common property of them, the Owner was responsible for the condition of the common property, except to the extent it may have effectively delegated that responsibility. However, its delegation of management to the Managing Agent was implicitly subject to any express instructions concerning the management of the premises that the Owner might give or had given. It gave an instruction and the Managing Agent acted upon it.

96 The Managing Agent’s neglect in recommending a change to the lighting in the relevant area was in my view an important one. The instruction from the Owner was by 2004 an old one. It had been given before any significant operations of the Centre had occurred. Moreover the Managing Agent was the entity with the day to day management of the premises and was remunerated to undertake that role. In my view its responsibility for Mr Clark’s injuries was somewhat greater than that of the Owner.

97 In these circumstances, I consider that the appropriate apportionment is 40 per cent responsibility on the part of the Owner and 60 per cent on the part of the Managing Agent. Accordingly the Owner is entitled to an order for contribution from the Managing Agent in respect of 60 per cent of the Owner’s liability to Mr Clark.

Orders

98 For the reasons I have given, I propose that the following orders be made:

(1) The appeal is allowed in part;

(2) By consent, vary the amount of the judgment entered against the Owner in favour of Mr Clark by substituting the amount of $120,064.12 for the amount of $160,000;

(3) Set aside the order of Christie ADCJ made on 28 May 2009 dismissing the Owner’s Cross Claim against the Managing Agent;

(4) Order that the Managing Agent contribute to the Owner 60 per cent of the Owner’s judgment liability to Mr Clark;

(5) Set aside the judgment directed on 28 May 2009 in favour of the Managing Agent against Mr Clark, together with the order that Mr Clark pay the costs of the Managing Agent;

(6) Direct the entry of judgment in favour of Mr Clark against the Managing Agent in the amount of $120,064.12;

(7) Order that the Owner and Managing Agent pay Mr Clark’s costs of the appeal;

(8) Order that the Managing Agent pay Mr Clark’s costs of the proceedings at first instance (this order being in addition to the order made at first instance that the Owner pay Mr Clark’s costs of the proceedings at first instance);

(9) Order that the Managing Agent pay 60 per cent of the Owner’s costs at first instance and on appeal of the Owner’s Cross Claim against the Managing Agent and of the costs payable by the Owner to Mr Clark in respect of Mr Clark’s claim against the Owner;

(10) Order that the Managing Agent pay the Owner’s costs at first instance and on appeal of the Managing Agent’s Cross Claim against the Owner;

(11) Grant leave to the Managing Agent to apply within 14 days of the date of this judgment for an order against the Owner for contribution in respect of the Managing Agent’s liability to Mr Clark (including as to costs) and for associated orders, including an order as to the costs of its Cross Claim; and

(12) The Managing Agent to have a certificate under the Suitors’ Fund Act 1951, if qualified.

: I agree with Macfarlan JA.

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