South Sydney Junior Rugby League Club Ltd v Gazis

[2016] NSWCA 8

Court of Appeal

Supreme Court

New South Wales

• Summary available
• Amendment notes

Medium Neutral Citation:

South Sydney Junior Rugby League Club Ltd v Gazis [2016] NSWCA 8

Hearing dates:

14 and 15 December 2015

Decision date:

09 February 2016

Before:

Basten JA at [1];
Macfarlan JA at [133];
Simpson JA at [134]

Decision:

(1)   Allow the appeal by South Sydney Junior Rugby League Club Ltd in respect of the judgment in the Common Law Division given on 17 November 2014 and the orders with respect to the appellant entered on 1 December 2014.

 

(2)   Allow the appeal by the Workers Compensation Nominal Insurer in respect of the judgment and orders referred to above.

 

(3)   Set aside orders (1)-(5) made and entered on 1 December 2014 and in place thereof:

 

(a)   dismiss the proceedings brought by the plaintiff Ross Gazis against the second and third defendants in proceedings 2009/335151 in the Common Law Division;
(b)   order that the plaintiff pay the costs of the trial of the second defendant, South Sydney Junior Rugby League Club Ltd.

 

(4)   Order that the first respondent, Ross Gazis, pay the costs of the appellants, South Sydney Junior Rugby League Club Ltd and the Workers Compensation Nominal Insurer, in this Court.

(5) Grant the first respondent a certificate under the Suitors’ Fund Act 1951 (NSW) with respect to the costs of both appeals.

Catchwords:

EMPLOYMENT – whether contract of employment – whether sub-contractor – whether subject to a labour hire agreement – whether contractor’s insurance policy responded to claim of injury to worker not an employee

 

TORTS – negligence – workplace injury – liability of occupier of premises – scope of plaintiff’s employment duties – whether occupier had knowledge of plaintiff’s activities – scope of occupier’s duty of care – whether risk of injury foreseeable – whether risk of injury significant – breach of duty – Civil Liability Act 2002 (NSW), s 5B

  TORTS – negligence – workplace injury – liability of employer – failure to inspect premises where plaintiff worked – whether inspection would have revealed risk of harm which materialised – whether breach of duty causative

Legislation Cited:

Civil Liability Act 2002 (NSW), ss 3B, 5B
Workers Compensation Act 1987 (NSW), ss 151A, 151E, 151Z; Pt 5, Div 3

Cases Cited:

Czatyrko v Edith Cowan University [2005] HCA 14; 79 ALJR 839
Endeavour Energy v Precision Helicopters Pty Ltd (No 2) [2015] NSWCA 357
Garzo v Liverpool/Campbelltown Christian School [2012] NSWCA 151
Nationwide News Pty Ltd v Naidu (2007) 71 NSWLR 471; [2007] NSWCA 377
Phillis v Daly (1988) 15 NSWLR 65
Shirt v Wyong Shire Council [1978] 1 NSWLR 631
Thompson v Woolworths (Qld) Pty Ltd (2005) 221 CLR 234; [2005] HCA 19

Category:

Principal judgment

Parties:

2014/373041:
South Sydney Junior Rugby League Club Ltd (Appellant)
Ross Gazis (First Respondent)
Workers Compensation Nominal Insurer (Second Respondent)
HCC Underwriting Agency Ltd (Third Respondent)

   2015/60459:
Workers Compensation Nominal Insurer (Appellant)
HCC Underwriting Agency Ltd (formerly Ilium Underwriting Agency) as agent for Syndicate 4040 (as Insurer for Gual Pty Ltd formerly known as Sermacs Australia Pty Ltd) (Respondent)

Representation:

Counsel:
Mr R Cavanagh SC/Mr S Holmes (South Sydney Junior Rugby League Club Ltd)
Mr P Webb QC/Mr P Perry (Workers Compensation Nominal Insurer)
Mr J E Maconachie QC/Mr J C Lee (Gazis)
Mr N E Chen (HCC Underwriting Agency Ltd)

  Solicitors:
Hall & Wilcox Lawyers (South Sydney Junior Rugby League Club Ltd)
Monaco Solicitors (Gazis)
Lee Legal Group (Workers Compensation Nominal Insurer)
Kennedys (HCC Underwriting Agency)

File Number(s):

2014/373041; 2015/60459

 Decision under appeal 

Court or tribunal:

Supreme Court

Jurisdiction:

Common Law

Citation:

[2014] NSWSC 1617

Date of Decision:

17 November 2014

Before:

Rothman J

File Number(s):

2009/335151

HEADNOTE

[This headnote is not to be read as part of the judgment]

Following a robbery at its premises at Anzac Parade, Kingsford, the South Sydney Junior Rugby League Club (“the Club”) contracted with Sermacs Australia Pty Ltd (“Sermacs”) to provide security on site. In order to fulfil its contract, in October 2005 Sermacs obtained the services of Mr Gazis from MPS Security Pty Ltd (“MPS”) to work as a security guard licensed to carry a gun. Whilst working in the Club Mr Gazis was injured.

The Club had implemented security arrangements which involved stationing an armed guard on the first floor of the premises while money from poker machine takings was transported in boxes on large trolleys by Club employees through to the counting room. On 19 May 2006, when Mr Gazis sought to move one of these trolleys, he lost his grip on the trolley, fell backwards and injured his back.

In May 2009 Mr Gazis commenced proceedings in the District Court against Sermacs and the Club seeking damages in negligence, and later against MPS, his employer, for a workplace injury covered by the Workers Compensation Act 1987 (NSW). Proceedings were transferred to the Supreme Court 18 months later. The claim against Sermacs was settled on the first day of proceedings; however, the Club and MPS maintained their cross-claims against Sermacs for contribution. MPS had gone into liquidation and proceedings with respect to its liability were continued against the Workers Compensation Nominal Insurer. Sermacs had changed its name to Gual Pty Ltd which also subsequently went into liquidation, and proceedings were continued against its insurer HCC Underwriting Agency Pty Ltd (“HCC”). (Because any assessment of liability hinged on the actions of the original defendants, these parties continue to be referred to as MPS and Sermacs in the judgment.)

After trial, Rothman J entered judgment for Mr Gazis against the Club and his employer, apportioning liability between them as to the Club (75%) and the employer (25%), with Sermacs found not liable to contribute. Both the Club and MPS appealed the trial judge’s findings with respect to their liability, and in the alternative, challenged the finding in favour of Sermacs, submitting that Sermacs should contribute to any liability they were found to have to Mr Gazis. Additionally, the Club appealed against the award of damages as it related to past and future domestic care and non-economic loss.

The Court (Basten JA, Macfarlan and Simpson JJA agreeing) upheld the appeals, and set aside the judgments in favour of Mr Gazis. Because it concluded that neither was liable to the plaintiff, the other issues did not need to be determined.

In relation to the Club, the Court held:

1. The Club owed a duty of care to the plaintiff as the occupier of the premises at which he worked: [17], [73].

2. Mr Gazis’ employment duties did not extend to moving the trolleys: [44]. The Club supervisors did not know that Mr Gazis engaged in this activity: [71], [72], [112].

Nationwide News Pty Ltd v Naidu (2007) 71 NSWLR 471, considered.

3. A duty of care in circumstances where the Club knew or ought to have known that the plaintiff moved trolleys could only have required a direction to desist. The risks attending moving an unladen trolley were sufficiently obvious and quite unlikely to eventuate and hence did not, in the exercise of reasonable care, require such a direction: [89], [102].

Phillis v Daly (1988) 15 NSWLR 65, referred to; Thompson v Woolworths (Qld) Pty Ltd (2005) 221 CLR 234, distinguished.

4. The finding of negligence on the part of the Club was set aside: [114].

In relation to MPS:

5. As Mr Gazis’ employer, MPS owed a non-delegable duty of care to its employee to take reasonable care to avoid exposing him to unnecessary risks of injury. The scope of this duty depended on the nature of Mr Gazis’ working environment which was not under the control of MPS. MPS was in breach of its duty of care as it had not taken reasonable steps to investigate the environment in which Mr Gazis worked. Nevertheless, this breach was not causative of the harm suffered by him because the risk would not have been identified on any reasonable inspection: [122]. MPS was found not liable and the judgment against the Workers Compensation Nominal Insurer was set aside: [123].

Czatyrko v Edith Cowan University [2005] HCA 14; 79 ALJR 839, applied.

Judgment

1. BASTEN JA: On 19 May 2006 Ross Gazis (“the plaintiff”) was working as an armed guard on the premises of the South Sydney Junior Rugby League Club (“the Club”) at Anzac Parade, Kingsford. The plaintiff was required to be present on the first level of the Club in the early hours of the morning when the cash taken from poker machines was counted in a room on that level. The money was transported to the counting room (known as the soft count room) on large trolleys by employees of the Club. The plaintiff sought to move one of the empty trolleys, lost his grip and fell, injuring his back.

2. On 19 May 2009, the plaintiff commenced proceedings in the District Court, which were transferred, some 18 months later, to the Supreme Court. Following a trial in April 2014, Rothman J delivered reasons for judgment on 17 November 2014. [1] On 1 December 2014 orders were entered, giving judgment for the plaintiff against the Club in an amount of $929,329.20. The Club has appealed against that judgment.

   1. Ross Gazis v Gual Pty Ltd [2014] NSWSC 1617 (“Gazis”).

3. There is a further appeal. The plaintiff was not employed by the Club; in June 1995 he commenced employment with MPS Security Pty Ltd (“MPS” or “the employer”) and was still so employed at the time of the accident. The services of the plaintiff, however, were not supplied directly by his employer to the Club. Rather, the Club had contracted with an independent company, Sermacs Australia Pty Ltd (“Sermacs”) to provide security at the premises of the Club in Anzac Parade, Kingsford. In order to carry out its contract with the Club, Sermacs obtained from MPS the services of the plaintiff, who was a licensed security guard and licensed to carry a gun. At trial, the employer was held liable to the plaintiff.

4. The second appeal, by the employer, challenged that finding. Because of its statutory entitlement to recover payments made by way of workers’ compensation to the plaintiff, there was no order for payment of damages by the employer. As senior counsel for the plaintiff stated on the appeal, the plaintiff had no interest in maintaining a claim for damages against the employer. The question of the employer’s liability had other consequences in relation to the cross-claims between the defendants.

5. The proceedings commenced by the plaintiff in May 2009 named Sermacs and the Club as the first and second defendants respectively. On 11 December 2009 the plaintiff commenced separate proceedings against MPS, which had by that time gone into liquidation. By the time the matter came to trial in the Supreme Court, the two sets of proceedings had been consolidated so that Sermacs was the first defendant, the Club was the second defendant and the employer was the third defendant. The plaintiff settled his claim against Sermacs on the first day of the trial. Nevertheless, Sermacs remained a party because the other defendants had brought cross-claims against it for contribution.

6. The names of the parties to the present proceedings do not reflect those identified above. That is because Sermacs had changed its name to Gual Pty Ltd, which had in turn gone into liquidation. Its insurer, HCC Underwriting Agency Pty Ltd (“HCC”) was substituted for Sermacs. Subject to a question about the coverage of the insurance policy, the liability of HCC depended on the liability of Sermacs. Accordingly, except when dealing with the issue concerning the insurance policy, it will be convenient to continue to refer to the security firm as Sermacs, when considering the extent of any liability to the plaintiff.

7. The employer also went into liquidation and the proceedings were continued against the Workers Compensation Nominal Insurer, pursuant to the terms of the statutory policy. Again, because the liability of the Nominal Insurer depended on that of the employer, it will be convenient to continue to refer to the party as MPS or the employer (or “his employer”, in relation to the plaintiff) when considering questions of duty and breach.

8. The trial judge found that Sermacs was not liable to the plaintiff, but that the Club and his employer were, apportioning liability between them as to the Club (75%) and the employer (25%).

9. On appeal, both the Club and the employer challenged the findings of liability; in the alternative, they challenged the finding in favour of Sermacs, which, both submitted, should be required to contribute to any liability they had to the plaintiff.

10. In response to the employer’s cross-claim against Sermacs, its insurer responded, defensively, that if Sermacs were liable, the policy of insurance nevertheless did not respond to that liability.

11. In addition to questions of liability and contribution, the Club also appealed against those parts of the award of damages as related to past and future domestic care and non-economic loss.

(1)   Background

12. It is appropriate to deal with questions of liability first. Liability depends on both the existence of a duty of care and breach of that duty (leaving to one side causation). At a level of abstraction, one would expect to find a duty of care owed by all three parties involved in the work undertaken by the plaintiff. The real issue turned upon the scope of the particular duty owed by each in the circumstances of the case and whether or not it was breached. That issue required an analysis of four elements, namely (a) the contractual relationships between the parties; (b) the nature of the work required of the plaintiff; (c) the manner in which the plaintiff was injured, and (d) the knowledge (including constructive knowledge) of the parties as to how the plaintiff carried out his work.

(a)   contractual arrangements

(i)   the Club and Sermacs

13. The Club had a large gaming room on the ground floor of its premises, containing poker machines. Money was removed from the machines each day in the early hours of the morning. The Club had six trolleys, each capable of carrying up to 96 tins of cash. The cash was loaded onto the trolleys from the machines, transferred from the ground floor to the first floor by lift and taken to the counting room where the money was unloaded and counted. Following an armed robbery, the Club prepared a tender document setting out the specifications for the provision of security services at the Club’s premises. The Club entered into a contract with the successful tenderer, Sermacs.

14. The basic terms of the contract between the Club and Sermacs can be gleaned from the tender document, although the document appears to have contained some standard terms which were not obviously relevant, including requirements that all electrical leads brought onto the site were to be checked by the Club, and that data sheets be provided for hazardous substances brought onto the site. In any event, one of the nine positions identified in the document was that of an armed guard for the hours of 5am-9.30am, seven days a week. That was the position in which the plaintiff worked.

15. There was a dispute as to whether the tender document in fact formed part of the contract between the Club and Sermacs. Counsel for the employer contended that it did; counsel for Sermacs submitted that it did not and, indeed, there was no finding by the trial judge that it did. As counsel for Sermacs correctly submitted, the findings went no further than the following proposition (which appears in more than one part of the judgment):[2]

“Sermacs contracted to provide security services to the Club. Part of that contract was the provision of an armed guard for certain hours on the first floor of the Club premises.”

2. Gazis at [130].

16. So much was common ground; what the employer sought to rely upon was a statement in the tender document that the contractor would be responsible for “supervising their personnel on site.”

17. The principal witness called by the Club was Paul Muir, its General Manager, Customer Service, who gave evidence that he had approached a number of companies in or about 2004 to provide security services to the Club. Beyond that fact, he neither gave evidence in chief, nor was cross-examined, about the specific terms of the contractual arrangement between the Club and Sermacs. There was no written agreement in evidence; the judge made no finding as to whether there was a written agreement, or whether the contract was partly in writing and partly oral or entirely oral. Beyond what has already been noted, it is not possible for this Court to make findings as to the terms of the agreement, just as it was not possible for the trial judge to take the matter any further than he did. For reasons noted further below, it does not matter which party was responsible for supervising the plaintiff’s work and providing him with a safe system of work. There is no basis in the contractual material for doubting that the Club and Sermacs both owed duties of care to the plaintiff.

(ii)   Sermacs and MPS

18. There was no dispute that the plaintiff remained, at all relevant times, an employee of MPS. The relationship between Sermacs and MPS was said to be either that of a labour hire agreement, whereby Sermacs obtained the services of the plaintiff from MPS in order for Sermacs to perform its contract with the Club or, alternatively, a subcontracting by Sermacs of part of its obligations with the Club to MPS, which provided the plaintiff in fulfilment of those obligations. Sermacs submitted, and the trial judge accepted, that there was a subcontracting of part of Sermacs’ obligations, by assignment to MPS. The nature of the relationship had significance, at least in theory, to the scope of the duty owed by each party, but particularly Sermacs, to the plaintiff. Further, if the plaintiff were an employee of a subcontractor, the insurer (HCC) relied upon an exclusion in its insurance policy with respect to any liability for claims in respect of personal injury to “the employees of subcontractors arising out of or in the course of his/her employment in Your [Sermacs’] Business”. [3] Counsel for HCC accepted that the case on the exclusion depended on this (perhaps doubtful) point of distinction.

    3.    Commercial liability certificate issued to Sermacs Australia Pty Ltd, Exclusions, cl 4(a).

19. The arrangement between Sermacs and MPS appears to have been an oral agreement, and to have resulted from a telephone call to the managing director of MPS, Con Kalls, from a person at Sermacs, whose name Mr Kalls could not recall. Mr Kalls said he believed he was the director. [4] His evidence continued: [5]

    4.    Tcpt, p 189(25).

    5.    Tcpt, p 190-191.

“Q. What did the person ask you when he rang?

A. He spoke to me on the phone saying to me that they have the contract with Souths Juniors Club and because my security company, we are providing armed guards, if we could be able to supply him with an armed guard for the morning hours.

Q. What did you say in response to that?

A. And I said yes, we have one available, there’s no problem.

Q. And did he tell you the hours –

A. He mentioned the hours.

Q. – that he required the armed guard to work.

A. That’s right.

…

Q. Did you agree a price with this person?

A. Correct.

Q. And was the price that you agreed a price only for the provision of this one armed guard?

A. Correct.

…

Q. Did you say that after that time did at some stage you receive some standard operating procedures?

A. Yes.

…

Q. Did you give those standard operating procedures to the plaintiff?

A. I photocopied it and give it. It was one page of standard operating procedures which he took with him and apparently he had to go through them the first day at work at the club.

Q. And how did it come about that he came to be wearing a Sermacs uniform?

…

A. They had to supply us with a uniform which I gave to Mr Gazis.

Q. You continued to employ and pay Mr Gazis’ wages, didn’t you?

A. Correct.”

20. There may be elements of ambiguity as to the precise terms of the arrangements between the employer and Sermacs and between Sermacs and the Club, but in broad outline, there was a contract between Sermacs and the Club to provide security services on the Club’s premises. Sermacs did not have available to it an armed guard for the morning duties outside the counting room. Sermacs arranged for MPS to provide an armed guard from its staff. MPS provided Mr Gazis. In ordinary parlance, this was a labour hire arrangement between MPS and Sermacs which allowed Sermacs to fulfil its obligations under its contract with the Club.

21. The trial judge took a different view, treating the arrangement as one by which Sermacs subcontracted part of its contractual obligation to MPS. The key findings appear in the following passages:

“[132]   It is sufficient, for my purposes, to accept the proposition to which the Club refers, namely, that a ‘subcontract’ is ‘a contract that assigns some of the obligations of the prior contract to another party’. Part of the obligation of the contract between the Club and Sermacs was the provision of security services, by the use of an armed guard, at the first floor location.

[133]   The obligations under that part of the contract were contracted to another party, namely MPS. It is unnecessary in order for a subcontract to exist for there to be a formal assignment of obligations to a particular party. Rather, there is a requirement that an identifiable aspect of the work undertaken under the contract is delegated to a different entity for that latter entity to perform it.

[134]   I do not consider the arrangement between MPS and Sermacs was a ‘labour hire’ arrangement. Indeed, the evidence before the Court is that MPS understood that the armed guard would be provided as part of Sermacs' contract such that the directions be given directly by employees of the Club.”

22. However, that construction is implausible from the perspective of each party. First, from the perspective of MPS, it was supplying an employee for which it received payment of his wages, together with a mark-up. Mr Gazis remained an employee of MPS and operated as part of the Sermacs team, being required to wear Sermacs’ identifying clothing at work.

23. The conversation with Mr Kalls did not indicate that Sermacs thought that it was assigning any part of its contractual obligation with the Club; it was obtaining a qualified person to fulfil part of its contract with the Club. It was not put to Mr Muir that Sermacs had a contractual right to subcontract part of its obligations: the inference from his evidence was that he assumed that all the security officers supplied by the chosen contractor were the responsibility of that contractor, that is Sermacs, rather than a third party. On 23 June 2006 Mr Muir had given a statement to an insurance assessor in which he had explained that the Club had contracted with Sermacs and “I understand that they in turn subcontract to MPS Security.” [6] He was cross-examined about that belief and said that he came to that view at some point but could not remember when it was. [7] The evidence continued: [8]

“Obviously I knew about it at some point. Whether that arrangement changed down the track, because I think we came across the knowledge we were not initially happy with what was happening.”

6.    Statement, 23 June 2006, par 9.

7.    Tcpt, p 154(40).

8.    Tcpt, p 155(5).

24. Counsel for the plaintiff continued the cross-examination: [9]

“Q. But as you told us before you became aware sometime before providing your June 2006 statement that there were contractors on site from MPS and you weren’t happy about?

A. Well, we didn’t know that[;] we had employed or taken on Sermacs and they weren’t the guys providing that. I don’t think it was a major thing, we just thought they should have told us at the time.”

9.    Tcpt, p 164(25)-(30).

25. It might have been surprising if a contract for the provision of skilled personnel included a right to subcontract without the consent of the principal. The absence of evidence as to the relevant contractual terms as between the Club and Sermacs, together with the absence of any clear indication of a sub‑contractual relationship between Sermacs and MPS favours the conclusion that the latter relationship involved a labour hire contract. Nor was Mr Muir’s belief (however formed) inconsistent with that conclusion. It was not suggested to him that by reference to subcontracting he was distinguishing between an assignment of obligations and a labour hire agreement.

26. Although the judge found that there was a subcontract, he nevertheless rejected the proposition that the exclusion in the policy protected Sermacs’ insurer. He did so on the basis that Mr Gazis did not work “in the business of” Sermacs but that the injury arose in the course of his employment “with the Club, not Sermacs.”[10]

    10. Gazis at [144].

27. Sermacs’ insurer challenged this conclusion by way of a notice of contention. The contention should be upheld. The plaintiff was injured in the course of work undertaken in fulfilment of Sermacs’ obligations to the Club. He was, therefore, working “in” Sermacs’ business for the purposes of the exclusion. Nevertheless, reliance on the exclusion must fail on the acceptance by HCC that there was a distinction to be drawn (which may well be doubtful) between a person working as an employee of a subcontractor and a person provided under a labour hire agreement, with the exclusion engaged only in the former case.

(b)   nature of plaintiff’s work

28. The workers’ compensation insurance agent obtained a statement in June 2006 from Mr Kalls, as the director of plaintiff’s employer. Mr Kalls said that the plaintiff held a 1ABC security licence and an H security licence for armed work. [11] Mr Kalls continued: [12]

“His duties include static security work and escorts, no body guarding. … Ross was definitely not required to man handle trolleys at the South Sydney Juniors Club at Kingsford or any other place. This is definitely not included in his job description.”

11.    Statement, 22 June 2006, par 12.

12.    Statement at par 14.

29. Mr Kalls also stated: [13]

“I want to stress that it is not his job to pull or push trolleys and if he did so he acted outside the work procedures. I have made my own inquiries at the club and asked security guards there and they all told me that they don’t handle trolleys. Also I asked the managers, guards, cleaners and noone saw the alleged incident.

…

There is nothing we could have done to avoid this alleged incident as we had no knowledge that Ross was going to pull or push trolleys.”

13.    Statement at pars 34 and 37.

30. Mr Kalls was also questioned about his knowledge of Mr Gazis’ work. He said that he had never been to the Club but he knew “exactly what he was doing as per the standard operating procedures.” He was asked whether he had asked Mr Gazis what he was doing and responded, “Of course I did.” [14] The cross-examination continued: [15]

“Q. What did he tell you?

A. He told me he was – while the time was coming to unlock the machines and getting the cash out of the machines he had to be the person there to make sure that everything was, you know, to overseeing what was happening.”

There was no challenge to his statement that it was not part of the plaintiff’s duties to push or pull trolleys at the Club.

14.    Tcpt, p 192(25).

15.    Tcpt, p 192(45).

31. Mr Muir had been, in 2006, responsible for the gaming room and the collection and counting of money. He set out in a statement, prepared in November 2013, an account of those operations, including the role of the armed guard (referred to as a “gun guard”).

32. There was no plan of the Club tendered in evidence, but Mr Muir’s description indicated that the trolleys were kept on the first floor until it was necessary to empty the poker machines, which commenced around 6am each morning. That exercise involved three employees of the Club pushing the trolleys around the ground floor, stopping at each poker machine, where one person would open the machine and the other two would take out the tin containing money and replace it with an empty tin. There were guards who attended that exercise. Mr Muir said: [16]

“The guard’s function was to walk with the members of staff watching and protecting should anything arise. The guard was not required to and did not, as far as I am aware, handle the money tins or push or pull the trolleys around the floor emptying the tins. This would have been contrary to the role of acting as the security guard. All the guards have two-way radios.”

16.    Statement, 19 November 2013, par 10.

33. Mr Muir then described the movement of the money to the first floor: [17]

“The gun guard does not undertake the security work whilst the three members of staff are emptying the machines. The gun guard stays on the first floor. When a trolley is ready to be taken up to the first floor, the gun guard is notified through the two-way radio. He or she operates the lift and stands guard as the trolley is brought up and pushed out of the lift into the soft counting room. …

Each trolley is brought up from the lower floor or wherever it might be with three members of staff accompanied by a guard. When the trolley reaches the soft counting floor the three members of the staff and the guard are met by the gun guard whose role it is to keep watch.”

17.    Statement at pars 11 and 13.

34. Speaking more generally, Mr Muir explained that the Club had approximately six trolleys which it used for moving the money and that the process took between two and a half and three hours each morning. [18] Mr Muir stated that he was “regularly on the first floor during the clearing process.” He continued: [19]

“I did not ever observe a security guard pushing or pulling a trolley. There were three members of staff allocated to do this. The system of work was established in 2002 and there is a safe work method statement which specifies the system and processes by which the work is to be performed. It does not involve the security guard moving the trolleys. The role of the security guard is to watch and be ready to act rather than move any trolleys. This is particularly so with the guard with the gun. It would be quite contrary to the duties which he was required to perform to involve himself in the movement of trolleys.”

18.    Statement at par 12.

19.    Statement at par 15.

35. At no stage was Mr Muir moved from his position that “contractors never have to move a trolley”, and that if a trolley had to be moved, the staff of the Club would have moved it. [20]

    20.    Tcpt, p 172(40)-(50).

36. The trial judge found, by reference to the standard operating procedures, that the plaintiff was required to work “under the direction of the Club House Manager.” [21] That point, however, may be put to one side: Mr Muir said he did not give any instruction to the plaintiff to move trolleys, a proposition which was unchallenged in cross-examination.

    21.    Gazis at [61], [66], [67], [72] and [86].

37. The plaintiff’s evidence in chief comprised his statements of 2006, 2009, 2011, 2012 and 2014 (the last relating only to his injury). In his 2009 statement he explained his function in the following terms: [22]

“I worked for MPS Security until my injury at South Junior Leagues club on 19 May 2006. Whilst at the Leagues club I was responsible for guarding and patrolling the strong room, which is where the money collected from the poker machines and registers is counted… and then transferred to the safe.”

22.    Statement, par 9.

38. In his statement of 2011, he was more expansive:

“11.   It was my understanding that my duties as a security guard working in the vicinity of the room known as ‘the soft room’ where trolleys containing coins and cash were stored was to provide security and assistance to members of staff the leagues club who were transferring trolleys of boxes of money from the poker machines to the soft room.

12.   I was never told either by my employer, the leagues club or Sermacs Australia not to provide physical assistance to members of staff regarding the transfer of trolleys and I was never supervised.

13.   I was never given a clear statement of duties regarding the security work at Souths Juniors Leagues Club, I had to use my own initiative. No specific system of work or specified duties were given to me.”

39. In the same document, in describing the accident, he stated, “I believed it was my duty to assist those members of staff[;] I went to pull one of the trolleys which contained the money boxes on top of it.” [23]

    23.    Statement, par 19.

40. In his statement of December 2012, the plaintiff said: [24]

“I understood my duties at Souths Juniors Leagues Club were to provide security and assist members of staff in transferring trolleys of boxes of money from the poker machines to the soft room.

...

I was never told by anyone from MPS Security, Sermacs or Souths Juniors Leagues Club that I should not be moving the trolleys during the course of my employment.”

24.    Statement, pars 8 and 10.

41. It was tolerably clear from this evidence that the plaintiff had not been told to assist with moving the trolleys, but took it upon himself to give such assistance as he thought appropriate from time to time. The only assistance which he claimed to have provided, beyond his role as a security guard, was the placement of one trolley each day from a place in the corridor to a place outside the counting room door, being a distance of some 8-10 metres.

42. Counsel for the Club cross-examined the plaintiff to the following effect: [25]

    25.    Tcpt, pp 38-39.

“Q. It was no part of your job, Mr Gazis, to move any trolley, was it?

A. Nobody told me not to move a trolley.

Q. Yes, and nobody told you to move the trolley as well. That’s right, isn’t it?

A. Part of my job is to satisfy the customer and our company to stand out as the best, and that’s what we do.

Q. Who told you that it was part of your job to satisfy the customer and stand out as the best? Which person told you that? Was it Mr Kalls or someone else?

A. I always did that for the company I work. I work for 11 years and everywhere I went they like our services.

Q. Mr Gazis, I will just repeat my question. It was no part of your job to move the trolley at any time whilst you are working as a gun guard, was it?

A. It was.

Q. You agree no-one ever told you to move a trolley?

A. No-one told me to move a trolley, no one told me not to move a trolley.”

43. There was no evidence to support the proposition that the moving of an empty trolley in the manner outlined above constituted part of the plaintiff’s work description. The unqualified evidence of both Mr Muir and Mr Kalls was that it did not. The situation was accurately described by Mr David Dubos, an expert instructed for the plaintiff, in his report in the following terms: [26]

“The plaintiff had not been directed to pull the trolley, however as a helpful co-operative task of assistance the plaintiff regularly moved the trolley. He was standing in that area and naturally wished to assist Club staff in the process of counting moneys.”

26.    Report, David Dubos Consulting Pty Ltd, 5 November 2009, at par 118.

44. If the plaintiff set out to prove that his action in moving the trolley was part of his contractual duties as an armed guard, he failed to do so. Accordingly, it became necessary for him to demonstrate, in order to succeed in his claim against the Club, that it had, or ought to have had, knowledge of his regular activities in that regard. The evidence and findings on this matter were a major focus of the appeal. There were, in substance, two separate issues. First, there was a factual issue as to who knew, or should have known; secondly, there was a question as to whose knowledge could properly be ascribed to the Club.

(c)   how the injury occurred

45. No one who worked in the counting room gave evidence, but the general procedure adopted was not in dispute. Once the laden trolleys were brought up to the first floor, the Club’s staff manoeuvred them into the counting room where the tins containing money were emptied. At some stage in that process, one empty trolley was taken out again and placed in the corridor some 8-10 metres from the counting room door. The placement of the empty trolley would have allowed another trolley or trolleys to be manoeuvred down the corridor into the counting room. (There was also another small trolley with a scale for weighing coins, which was in the corridor at the time of the plaintiff’s accident.) At the end of the process, the empty trolley which had been parked in the corridor would be taken back into the counting room. To facilitate that process, and presumably after all the laden trolleys had been brought in, the plaintiff would move the empty trolley in the corridor to a position close to the door of the counting room, in order to assist the Club staff to take it back into the counting room in due course.

46. Following the accident, the plaintiff made a claim for workers’ compensation. On 14 June 2006, less than four weeks after the accident, an insurance officer took a statement from the plaintiff. The account of the incident given by the plaintiff on that occasion was as follows: [27]

“There is big four wheel trolleys, which they held money boxes of the poker machines. I went to pull the trolley with my right hand. I am right handed. I took hold of the trolley handle and I lost my grip because I didn’t put enough strength to pull the trolley and I went backwards, lost my balance and fell on my bottom. … The trolley was loaded with money boxes and the time and was hard to pull. I had used this trolley many times before. There is six trolleys altogether and I have manoeuvred them around before. I can’t say how heavy the trolley was. … I have pulled trolleys with about the same weight on them before, its six trolleys. … When I start pulling the trolley the front wheels were looking straight ahead. I went to pull the trolley at an angle and that’s why the wheels did not turn and I lost my grip.”

27.    Statement of 14 June 2006, at par 29.

47. Precisely how the accident occurred was by no means clear. If by saying the trolley was “loaded with money boxes at the time and was hard to pull” the plaintiff had been implying that the money boxes themselves were laden with money, that was not the case run at trial. The likely inference to be drawn from the statement that “the front wheels were looking straight ahead” and he pulled the trolley “at an angle” was that he expected the wheels to swivel. A further inference is that they did not.

48. In February 2009, the plaintiff made another statement in which he said that the trolley was “overloaded with approximately 96 to 100 boxes of money from poker machines and it was very hard to pull.” He further said that as he went to pull the trolley with his right hand, “it suddenly became jammed and I fell backwards”.

49. In a third statement, dated 20 December 2012, he noted that the trolleys weighed “in the vicinity of 90 kilograms”. That statement differed linguistically from the earlier statements of the plaintiff, but, importantly, the reference to 90 kilograms was clearly intended to convey that the boxes on the trolley were empty. The phrase “in the vicinity of 90kg” reflected an estimate of the weight made by Mr  Dubos in November 2009. [28] It was clear that Mr Dubos was estimating the weight of an unladen trolley.

    28.    Report, at par 112.

50. Mr Dubos’ report was significant in another respect. He measured the forces required to pull the trolley when the wheels were parallel to the direction of travel and when they were not. The difference in the forces required was of the order of 1%. Accordingly, if the wheels were free to swivel, it would have made no difference to the force required whether they were pointing in the direction of the pulling, or not.

47. When Mr Dubos inspected a large steel trolley in 2009, he did so in the company of the plaintiff. He took pictures. The plaintiff gave evidence that the trolley was the same as that which he had attempted to pull on the day of the accident. Mr Dubos, recording information available to him, said that the plaintiff “could not move the steel trolley as it was so large and heavy.” [29] He described the trolley as having “six wheels fitted to non-directional swivel castors and hard rubber tyres.” (The inconsistency between that reference to six wheels and the plaintiff’s reference to “four wheel trolleys” was not resolved or addressed. [30] )

    29.    Report, par 110.

    30.    See at [46*] above

48. In cross-examination by counsel for the Club in the course of the trial, the plaintiff gave the following evidence: [31]

    31.    Tcpt, p 44.

“Q. So you went to pull this trolley with one hand with the wheels pointing at an angle not in the direction you were attempting to pull it. Is that right?

A. I was trying to pull it off the wall.

Q. Yes, but the wheels weren’t pointing in the direction that you were trying to pull it, were they?

A. No.

Q. And you knew, didn’t you, that with the wheels pointing not in the direction you were trying to pull it that would make it difficult to move the trolley?

A. That’s not true. I pull that trolley every day and the trolley move.

Q. You thought generally it was pretty easy to move the trolley did you?

A. Yes.

Q. You had never had any difficulty before this moving the trolley, did you?

A. No.”

53. There appear to have been three possible causes of the accident, arising on the evidence. One was, quite simply, casual negligence of the plaintiff in carrying out a task which he said he had carried out, of his own volition, every day for a period of some nine months. As his counsel accepted in the course of the appeal, that might have meant moving the trolley on between 100 and 200 occasions. The second possibility, which is a more specific version of the first, was that he used one hand when he usually used two. His evidence in cross-examination on this point was as follows: [32]

    32.    Tcpt, p 67.

“Q. You say, Mr Gazis, that you had moved the particular trolley on many days before the day of your incident, don’t you?

A. Yes.

Q. Had you always used one hand to move it?

A. No.

Q. Had you normally used two hands?

A. Yes.

Q. But it’s your recollection now that on the occasion of this incident you say you were trying to move it with one hand. Is that right?

A. Pull it out of the wall.

…

Q. Do you say that you lost your grip on the handle when you were trying to pull it out of the wall? Is that what you are saying?

A. Yes.”

54. The third possibility was that either the swivel mechanism or the wheels themselves had been locked in position. No evidence was led from the plaintiff as to that possibility, nor was it the subject of cross-examination.

55. The possibility arose from a document included in the tender bundle at trial, entitled “Standard Work Method Statement” and dated 16 September 2002. The document related to work described as “note stacker clearance”, but involved the removal of coins from poker machines, which occurred on the ground level. The task was identified as involving two stages, namely “moving note stacker trolley” and “exchanging note stackers”. In relation to the former, there were two OH&S problems identified, namely “push/pull strain injury” and “armed robbery”. In relation to the second stage, the problems identified were “lifting/carrying injury” and “armed robbery”. The second stage is not relevant: the corrective action identified was to carry no more than four tins at a time and to bend at the knees. In respect of the first stage, that is moving the trolley, to avoid strain injuries the statement required that at least three employees assist in the movement of the trolleys and also that “1 set of wheels is to be locked into place and this is to be changed should the reverse direction need to be taken.” (Employees were also required to undertake “5 minutes of warm-up exercises prior to commencing.”)

56. How wheels were to be “locked” was not entirely clear. However, Mr Muir was asked some questions with regard to the trolleys. In particular, his attention was drawn to the photograph taken by Mr Dubos in 2009. [33] It was identified for the purposes of the case in the following terms:

    33.    Tcpt, p 167(30).

“Q. That’s the trolley that Mr Gazis says he was pulling on the day he hurt himself?

A. Yes.

Q. And you’ve seen those trolleys before?

A. Yeah, we still have them.

Q. And that photo, I suggest, was taken in 2009, and it was the trolley that Mr Gazis says was in fact the trolley that he had been pulling?

A. Right.

Q. And the club had identified had it not, the pulling of the trolleys or the pushing of the trolleys was in fact an activity that carried with it the risk of injury?

A. Yes.

…

Q. And also in respect of the trolley, there were issues so far as the locking was concerned?

A. The simple – it was mainly for the guys on the floor because they’re having to wheel it around corners and having to go up a slope, and things like that. So the easiest way for them, because they were doing it all day, was to, once they got to their position, was to lock two of the wheels down. Whether they do that, I don’t know.”

57. Mr Muir’s attention was then drawn to the description of the wheels being locked into place and changed if the reverse direction were required and the following exchange took place: [34]

“Q. What does that mean?

A. Because they have to push and pull, and I think as I said, when we wrote – when this document got written, we looked at what was the easiest way for things to work, and whether sometimes that’s practical in its operation is the same – isn’t the same, but when you’re pushing it, and I – if you’re pushing it or pulling it with less than that, it would be – it would probably be a problem, but if you’ve locked in the back two wheels and it’s like any sort of – like a car, one set of wheels is stagnant, and one turns and makes it – manoeuvring around easier, but the fact of the matter with the trolleys are, sometimes you have to move them back and forward, and to do that, if you had the wheels locked in, then that may be a problem, so you’d have to unlock the wheels.

Q. If the trolley had a locking device on the wheels, that is something that would be the subject of some induction or training so far as the employees were concerned, to show them how to lock it and unlock it?

A. Yeah, it would have been, but this particular trolley there doesn’t have those wheels anymore that lock. This trolley here, when this was written, this trolley had different wheels.”

34.    Tcpt, p 170.

58. The description of the locking mechanism was quite unclear; whether the wheels were locked, as with a brake, or whether the swivel mechanism was locked was not explained. Furthermore, Mr Muir’s evidence (which was entirely consistent with the absence of any reference to a locking mechanism in the Dubos report) was that the trolleys did not have wheels that locked in 2009. Mr Muir’s explanation was that a different system had operated in 2002 when the document was written: no-one explored with him when the change occurred. Thus, there were equal periods of 3.5 years on either side of the accident in which that might have occurred, that is between the writing of the standard work method statement and the accident and between the accident and the inspection in October 2009.

59. The trial judge made findings about this issue, although the evidence set out above was not discussed. First, in a general description of the accident, the judge noted that the plaintiff “took hold of the trolley handle and began to pull it in order to move it.”[35] He continued:[36]

“Apparently, the wheels of the trolley were locked, or became locked, and the trolley did not move. As a consequence, the plaintiff's grip on the trolley gave way and the plaintiff fell backwards ….”

35. Gazis at [22].

36. Gazis at [23].

60. Under the heading “Procedures at Work” the judge made the further finding:[37]

“As a matter of reasonable expectation, one would expect that if a person were patrolling and guarding an area, that person would, from time to time, move non-fixed moveable items in that area. At no stage was Mr Gazis, as earlier stated, directed not to perform that work. Nor was Mr Gazis informed as to the correct manner of moving the trolley. The accident was a direct result of the attempt by Mr Gazis to move the trolley in a manner that did not take account of the necessity to ensure that the wheels of the trolley were not in a locked position.”

37. Gazis at [62].

61. The assumption underlying that last statement was that the trolley in question had a locking facility on the wheels and that it was necessary to check that the wheels were not locked before seeking to move it. Again, there was no discussion of the evidential basis for that implicit finding.

62. In a section headed “Principles on Liability” the judge referred to the “risk factors” associated with the movement of a trolley[38] in the following terms:[39]

“Most of those risk factors are self-evident. Nevertheless, they are identified by Mr Dubos in his report and include the size of the trolley; the potential for its wheels to lock; the fact that it was used on carpet and debris could build up in the wheels; and it required more than one person to move it in order to prevent the risk of injury.”

38. Gazis at [76].

39. Gazis at [77].

63. Significantly, Mr Dubos did not identify the potential for the wheels to lock: he did identify the possibility of debris “fouling” the wheels, [40] but did not say that the wheels could become jammed as a result of debris and there was no evidence or finding as to that.

    40.    Tcpt, p 221(23); Report, par 29.

64. The trial judge referred to “the capacity of the wheels of the trolley to lock”,[41] a statement followed by the conclusions on liability:

“[113]   In this instance, Mr Gazis had moved the trolleys daily on previous occasions. Whether by luck or otherwise, on the other occasions, the wheels were not locked. On this occasion the wheels were locked.

[114]   Mr Gazis was unaware of the risk involved in moving the trolley as it had been moved by him on previous occasions. The risk associated with the moving of the trolley without first ensuring that the wheels were not locked into position is not a matter of which Mr Gazis would have been aware or ought to have been aware, in those circumstances.”

41. Gazis at [100].

(d)   knowledge of plaintiff’s activities

65. The first (and only) relevant reference to this issue in the plaintiff’s evidence in chief came in his statement of 2011 where he said: [42]

“I had moved these trolleys many times before, I always found them hard to pull. There were six trolleys in total and I had manoeuvred them around before the date of the accident. Employees of the club, including supervisors, were sometimes present when I moved the trolleys and no one ever told me that I should not be doing this.”

42.    Statement, par 26.

66. He was cross-examined as to that evidence. [43]

    43.    Tcpt, pp 74-75.

“Q. Mr Muir was the supervisor, wasn’t he?

A. The supervisor?

Q. Yes, Mr Muir was the employee of the club who was the supervisor? You remember I asked you yesterday about Mr Muir and he was there almost every day?

A. Yes.

Q. He was the supervisor?

A. No, he had other supervisor.

Q. Wasn’t he the one who was there watching you and the [other] guards and the other club employees as they did their work?

A. There were managers.

Q. There were not any supervisors watching you move the trolley?

A. To my view everybody seen me be there [sic].

Q. You say you moved these trolleys when the soft room counters had finished their work and were coming out to get the trolley, is that right?

A. That’s correct.

Q. And the only people in and around outside the soft room door, whilst the counters were doing their work, the only person was you?

A. Me.

Q. There was not any supervisor around at that time, was there?

A. When I say supervisors, they walk around. They are on the floor.

Q. The only person who was walking around watching you as you were doing your work was Mr Muir, wasn’t it?

A. No, because it was Ron – I can’t remember his second name –

…

Q. Do you remember his surname at all?

A. No, but he was higher than Paul Muir.

…

Q. After the counters were escorted by you and the other security guard into the soft room, after the soft room door was closed, after you positioned yourself standing outside the soft room, there wouldn’t have been a supervisor there just looking at you, was there?

A. No, but they were walking around the club. There were managers; there was Paul Muir, there was Ron, I can’t remember name. There were people there.”

67. The statement given by Mr Muir in June 2006 contained the following propositions:

“10.   I have seen Ross Gazis at the club here but I don’t recall how long I have known him. I have seen him on numerous occasions in the club and always on the first level outside the soft count room, where all poker machine money is counted.

11.   His duty is to patrol/guard that area until the count is completed and the money is transferred down to the safe.

12.   We have a number of trolleys, probably six trolleys varying from four to six wheels where we place the note stackers (small metal boxes containing notes). We also have a hopper scale trolley and a coin counting trolley. The trolleys are generally stored out of the road on the first level between the soft room and the fire escape door. I don’t know where they were on the day of the alleged incident.

13.   We have our staff whose job is to move those trolleys around and the security guards are guarding the area and accompany the movement of the trolleys throughout the club. It is definitely not their job to move trolleys. We have never asked any guards to move trolleys within the club premises.

14.   I have seen Mr Ross Gazis guarding the soft room on numerous occasions but have never seen him move trolleys.

…

17.   I don’t know why Ross Gazis would have needed to move the trolley. The way it happens our staff comes in the morning and take all the trolleys out of the soft room and then they exchange the note stackers, they swap the full stacker from the poker machine with an empty one in the trolley and then when they complete that trolley they take it to the soft room and take another trolley out and continue the exchange. …

18.   I have never had occasion to speak with Ross Gazis or other guards about the movement of trolleys within the club. I would have thought they were all aware of their responsibilities here, which does not include moving trolleys.”

68. Mr Muir was cross-examined by counsel for Sermacs in relation to guards pushing trolleys. [44]

    44.    Tcpt, pp 146-147.

“Q. You had never seen, is this your evidence, a security guard push a trolley?

A. I have never seen one push a trolley.

Q. You have never seen a security guard handle a trolley?

A. When you say handle it, you mean put a hand on it?

Q. Or move it?

A. I certainly can’t recall seeing anyone, any security guards moving a trolley.

Q. If you have seen a security guard moving a trolley, what would you have done if anything, to the security guard?

A. I probably I would have told him that it’s not his job to push it.

…

Q. When you heard of Mr Gazis’ accident, did it come as a complete surprise to you?

A. Yes.

Q. Why is that?

A. Because he’s the gun guard. He shouldn’t have been doing anything. If anything, with gun guards, if I saw any of them where I thought they should not have been, because there were four or five different access points to that soft count room, we had escalators up and down, we had a whole floor coming this way … and there were doors that were meant to be shut. But ideally the gun guard had to have their wits about them and monitoring a whole host of the potential areas for people to come down.

Q. That was the [primary] function of the gun guard?

A. Yes.”

69. Counsel for the plaintiff also asked Mr Muir a number of questions regarding the manner by which the gun guard was expected to guard the money on the first level: [45]

“Q. But in order to ensure that the security guard was at that doorway of the soft room, it was important, wasn’t it, to ensure that the trolleys either were all in the room, or if they weren’t in the soft room, that they were in close proximity to him so he could guard doorway?

A. He didn’t actually have to guard that doorway. He had to guard a number of access points in the area, and generally, they wouldn’t be at the soft count door at all, because the only way to get to there was through the lift, and the only way anyone could come into the lift was if the soft count guard pushed the button. No one could get out [at] that floor, that the soft count guard didn’t know of.”

45.    Tcpt, pp 174-175.

70. The only other person identified by the plaintiff (as “Ron”) was probably Mr Ron Harder. Mr Harder had provided a statement, admitted without objection, but, being unwell, he was not required for cross-examination. Mr Harder noted that, in May 2006, his job title was “Operations Manager” at the Club. He said that there were times, in 2005 and 2006, when he was at the Club while the cash clearance was being carried out. He was aware that one of the security guards was “as a static gun guard, who guards the soft count room.” He also expressly stated: [46]

“I did not ever observe a security guard pushing, pulling or attempting to move a trolley whilst I was at the club.”

46.    Statement at par 6.

71. In the result, there was no evidence to suggest that Mr Muir knew of guards pushing or pulling trolleys, nor that any identifiable person at a relevant level of seniority in the Club management was aware of such activity.

72. It could reasonably be inferred that staff of the Club working in the counting room had the relevant knowledge, because it was they who placed the empty trolley out of the way in the corridor at some small distance from the counting room door, and it was they who found the trolley, at the end of their exercise, near to the door. As this happened, on the plaintiff’s evidence, on a regular basis over nine months, and he appears to have been the only other person who was always on level 1 in that period, it may be inferred that they knew that he was moving the trolley, even if they never saw him do it and none gave evidence. There was, however, no evidence that they had supervisory or managerial functions within the Club.

(2)   Liability of Club

(a)   basis of finding of liability

73. It was common ground that the plaintiff was, at all relevant times, employed by MPS and not by the Club. [47] At one stage, the trial judge stated that “for all intents and purposes, Mr Gazis formed part of the workforce at the Club and was bound to obey the lawful and reasonable directions of the Club’s management hierarchy.”[48] This should not be understood as a statement regarding his employment: it was common ground that his claim against the Club was covered by the Civil Liability Act 2002 (NSW) and did not involve a claim for work injury damages, which would have been governed by Pt 5, Div 3 of the Workers Compensation Act 1987 (NSW). Rather, the Club was liable, in a generic sense, as the occupier of the premises upon which the plaintiff undertook his employment functions. Its role as occupier was not merely passive, but included its activities in all aspects of the Club’s operation.

    47. Gazis at [14].

    48. Gazis at [72].

74. The Club knew that Mr Gazis was on the premises and knew the work which he was required to perform and where he was required to perform it. He had to enter the premises, obtain access to level 1, walk around the area, and perhaps use available bathrooms. He was to be there when Club employees brought the trolleys up in the lift; indeed, he was responsible for operating the lift for that purpose. As explained by Mr Muir, his presence, as an armed security guard, was intended to be a deterrent to would-be robbers. He wore the insignia of the security firm, Sermacs, and he was intended to be visible. None of his employer, Sermacs or the Club gave him instruction in the operation of the trolleys. That was because none intended or expected him to be involved in moving trolleys. If they had known, or should have known that he was undertaking that function, the most that would reasonably have been expected of them was a direction not to move trolleys. His work description did not lead to any reasonable expectation that he would be involved in moving trolleys, rather the contrary, as such activity would be inconsistent with his obligations as a guard. It was clear that Mr Muir did not think it part of the duty of an armed guard on the first floor to push trolleys; indeed, it was clearly his view that this would have been inconsistent with those duties.

73. The trial judge made the following finding:[49]

“Mr Gazis understood that his task included assisting the employees of the Club at the time he was patrolling the area. I accept the evidence of Mr Gazis that he was never told that he should not move the trolleys, whether empty or otherwise. I also accept his evidence that he moved the trolleys from time to time. It was a regular event and happened daily.”

49. Judgment at [56].

76. That finding fell short of accepting that it was part of Mr Gazis’ employment duties to move trolleys. There was no reason to doubt that, in accepting his evidence that he was not told not to move trolleys, the judge also accepted his evidence that he was never told to move them. The judgment continued:[50]

“As a matter of reasonable expectation, one would expect that if a person were patrolling and guarding an area, that person would, from time to time, move non-fixed moveable items in that area.”

50. Judgment at [62].

77. It was this latter passage which formed the basis of the ultimate finding of liability:[51]

“… I have come to the conclusion that the Club owes a duty of care arising from its position as occupier of the premises and the circumstance that it controlled the system of work that placed the trolleys in a position where the Club could foresee, and expect, Mr Gazis would, from time to time, seek to move the trolleys. The duty of care imposed upon them is that described earlier with particular reference to the passages in Thompson v Woolworths. The Club breached that duty of care and is liable in damage.”

51. Judgment at [148].

78. The reliance on Thompson v Woolworths (Qld) Pty Ltd [52] requires further explanation. It had a common feature with the present case. The plaintiff was required, in the course of her business, to deliver bread to a Woolworths store. Delivery drivers were required to reverse their trucks into a laneway and unload goods at a loading dock. Woolworths had two industrial waste bins which, when in use, were placed alongside the loading dock. They were routinely left in the laneway in front of the loading dock, thus constituting an obstacle for delivery vehicles. [53] Ms Thompson injured herself seeking to move one of the industrial waste bins. The High Court held that Woolworths owed a duty of care to delivery drivers to avoid operating its own business in a way which exposed them to an unreasonable risk of physical injury. [54]

    52. (2005) 221 CLR 234; [2005] HCA 19.

    53. Thompson at [6].

    54. Thompson at [27].

79. The critical factor upon which Woolworths was held liable appears from the following evidence:[55]

“As is common, questions of degree of risk are involved. Evidently, the bins were designed to be moved manually, and they were moved routinely by Council workers, the respondent's storemen, and other (male) delivery drivers without injury. Yet the appellant and her husband had told the respondent's employees that she could not move them safely, and Mr Frank Thompson [Woolworths’ regular storeman] agreed that she should not be moving them. What was involved was not a risk to everybody, but it was a risk to the appellant, and that was a risk of which the respondent was aware.”

55. Thompson at [30].

80. As the judgment of the Court concluded:[56]

“In the circumstances that prevailed, the respondent knew that, frequently, delivery drivers would move the bins. The respondent knew that not all drivers were capable of doing that without risk of injury.”

56. Thompson at [38].

81. On this basis, Ms Thompson was successful. However, the reasoning in that case cannot be translated to the present case without significant additional steps. First, there was no finding of actual knowledge on the part of any person in a supervisory role with the Club that the plaintiff moved trolleys in the course of his employment. Further, a necessary step in the reasoning required a finding that the plaintiff was not capable of safely moving a trolley without assistance or instruction. According to the plaintiff, he moved trolleys every day during the course of his employment over almost a year, during which time it would seem that he had moved trolleys more than 100 times, and possibly 200 times, if his evidence referred to more than one trolley per day (which was unclear). Although the evidence changed from his earlier statements, it appears that his account accepted by the trial judge involved moving an unloaded trolley.

82. Further, unlike the circumstances of Thompson v Woolworths, there was no suggestion of any practical necessity for the plaintiff to move trolleys. It appears to have been a course adopted by him voluntarily, because he wished to be of assistance. He agreed that no-one had ever asked him to do it. He gave no evidence of being thanked for doing it.

(b)   relevant legal principles

83. The legal principles applicable to the claim against the Club are to be found in part in s 5B of the Civil Liability Act, which it is convenient to set out.

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.

84. Although it is necessary to determine liability by reference to s 5B, it is not inappropriate to recall the reminder of Mahoney JA in Phillis v Daly:[57]

“There are dangers on any premises. A room may have a desk or a table. There is a danger that, if I fall, I will hit my head on it and my skull will be fractured. If the desk or table were not there, I would suffer little or no harm. And the danger is obvious: people do slip and fall. And the injury may be serious. But the obvious foreseeability of such an injury and its seriousness does not involve that, if a person falls and hits his head on a table, there must have been a breach of duty by the occupier of the room. And this notwithstanding that people may live without tables and that tables may be easily removed.”

57. (1988) 15 NSWLR 65 at 74.

(c)   foreseeability

85. Because the trolley, without its load of coins, was nevertheless reasonably heavy and required some force to move it, there were undoubted risks attached; a person seeking to move the trolley might strain a muscle or might slip and fall. There were no doubt objects in many areas of the Club which the person might hit if he or she fell. In the present case, the plaintiff appears to have caused the injury to his back by falling against the small trolley bearing the scales, which was also outside the counting room. As senior counsel for the plaintiff reminded the Court, and as Glass JA stated in Shirt v Wyong Shire Council,[58] the test of foreseeability is “undemanding”.

    58. [1978] 1 NSWLR 631 at 641E.

86. The plaintiff submitted that the risks attending the use of the trolley were well recognised by the Club, relying upon the “Standard Work Method Statement”, referring, for example, to the need for three employees to assist in the movement of trolleys, as corrective action against a risk of push/pull strain injury. While this was not precisely the risk of harm which materialised, it was similar in kind: it was a foreseeable risk.

(d)   significance of risk

87. The work methods statement should not, however, be taken out of context. There was no reason to suppose that a six-wheel (or four-wheel) trolley, with wheels that swivelled and which weighed approximately 90kg, required three people to move it with safety a few metres on level carpet. There was no evidence as to how heavy a laden trolley would be, but the fact that it contained up to 96 boxes, containing coins, suggested that the weight would be significant. As Mr Muir indicated, laden trolleys might need to be manoeuvred around corners and up slopes. Furthermore, the plaintiff himself gave evidence that “once every week or two” he made deliveries to a bottle shop owned by Mr Kalls, which involved unloading “up to 16 boxes of beer, wine or spirits from my vehicle onto a trolley and take them into the shop” estimating that each box would weigh around 10kg. [59] The real risks caused by weight lay in moving heavily laden trolleys, especially on the ground floor to which the work method statement was primarily directed. It was not directed to the risk which materialised. [60]

    59.    Statement, 20 December 2012, par 11.

    60. Garzo v Liverpool/Campbelltown Christian School [2012] NSWCA 151 at [7].

88. The plaintiff was apparently familiar with the weight and operation of the trolley, having moved it on a daily basis over a period of nine months. The work method statement identifying potential occupational health and safety risks, read in context, did not demonstrate that there was a significant risk in respect of the movement of an unladen trolley in the circumstances in which the plaintiff moved it. Similarly, when Mr Muir agreed that moving the trolley “could cause a push or pull strain injury in accordance with this document”, his answer must similarly be read as referring to the circumstances to which the statement was directed. [61]

    61.    Tcpt, p 171(5)-(10).

89. The requirement that a foreseeable risk be “not insignificant”, for the purposes of s 5B(1)(b), engages a different set of considerations, although not at the same level of generality as would suffice for a finding of a foreseeable risk. The significance of a risk will depend upon a variety of factors, including obviousness, likelihood of occurrence and seriousness of consequences. In the present circumstances (apart from the chance of the wheels being locked) the risk that a person would fall over if a force, either insufficient (as the plaintiff thought) or too great were applied, or if the person were careless in his or her grip, was foreseeable, but quite unlikely to eventuate. In my view, such a risk could be dismissed as insignificant or, which may be the other side of the same coin, not a risk which would cause a reasonable person in the position of a Club supervisor to direct the plaintiff not to move the trolley. It was possible that a supervisor would direct the plaintiff not to move the trolley because it was seen to be inconsistent with attention to his duties as an armed guard, but that is another matter; failure to give a direction for that reason would not constitute a breach of the duty of care owed to the plaintiff.

(e)   were the wheels lockable?

90. Continuing with the hypothesis that the Club had the relevant knowledge of his activities, the plaintiff’s claim, as upheld by the trial judge, depended upon establishing that the risk which materialised resulted from a particular mechanism of the trolley with which he was unfamiliar, namely a wheel-locking device. There are difficulties in maintaining the findings of the trial judge in that respect. First, it was not the case pleaded. As against the Club, pursuant to an amended statement of claim filed on the first day of the trial, three allegations were made. The first allegation was that the plaintiff “was required in the course of his duties” to assist members of the staff of the Club transferring metal money boxes from one part of the premises to another by use of a trolley. [62] That allegation was not made good. The second allegation was that the Club caused a number of such boxes to be loaded onto a trolley and caused the plaintiff to then move that trolley. [63] That allegation was not made good. The third allegation was that the plaintiff “attempted to move a heavily laden trolley”, which did not move. [64] That case was also not made out.

    62.    Further amended statement of claim, par 12.

    63.    Further amended statement of claim, par 13.

    64.    Further amended statement of claim, par 14.

91. The “particulars” of negligence [65] made claims that the trolley was not functional, that the wheels were not properly maintained, that it was not an appropriate trolley and that it did not have appropriate grips on its handle. None of these particulars was made good. There was no particular referring to any locking device.

    65.    Further amended statement of claim, par 17.

92. Secondly, the evidence (set out above at [54]-[58]) was quite limited and imprecise. Thirdly, the plaintiff assisted the trial judge both with written submissions and oral submissions. The written submissions contained two relevant statements. The first was that “[t]he plaintiff felt the trolley lock and this friction caused him to lose his grip and fall backwards”. [66] The statement that the plaintiff “felt the trolley lock” was not sourced to the evidence. It is true that he said that the trolley “did not move” (in his statement of June 2006) but he also said that he did not “put enough strength to pull the trolley”. The inference that he “felt it lock” was not available. He did say in his statement of February 2009 that the trolley “suddenly became jammed”, but that did not suggest a locking mechanism. Further, in his statement of 2011 he implied that the trolley did not move because the wheels were pointing in a different direction from that in which he was pulling.

    66.    Written submissions, 10 April 2014, par 25.

93. The second submission was that Mr Dubos had identified several risk factors including the “potential for its wheels to lock”. [67] That statement (a proposition adopted by the trial judge in his judgment) was false. Mr Dubos undertook measurements of the force required to move the trolley because he had understood that the plaintiff “applied a force which almost moved the trolley before he lost his grip”. [68] He noted that the force required was subject to three variables, namely:

“●   the position at which the wheels of the trolley were aligned when he attempted to pull it;

●   the effect upon friction and free movement of the wheels from foreign material and dirt which was potentially in the wheels and castors at the time of the injury accident;

●   whether any maintenance had recently been carried out on the trolley wheels and wheel mechanisms, either before the plaintiff’s accident or before the inspection and testing on 29 October 2009.” [69]

67.    Written submissions, par 40.

68.    Dubos report, par 73.

69.    Report, par 75.

94. Mr Dubos expressed the opinion that the plaintiff failed to move the trolley “as it was so large and heavy.” [70] He noted that a trolley had “six wheels fitted to non-directional swivel castors” and noted its significant weight and size. He said nothing about a braking mechanism or a mechanism for locking the wheels, which would obviously have been critical to his assessment. It is clear that the plaintiff did not suggest to him that the wheels had been locked, or that they were capable of being locked. It is equally clear that the trolley inspected in October 2009 did not have a locking device.

    70.    Report, par 110.

95. Mr Dubos was called to give oral evidence: no-one asked him any question about the possibility of a locking mechanism on the trolley.

96. In oral submissions, counsel for the plaintiff put the question of negligence against the Club in the following way: [71]

“At the end of the day what we do know is the trolleys were rolled [sic], the trolleys were very heavy, 90 kilos and, when filled, more. The trolley was in an awkward position up against the wall. The wheels obviously were in a different position to that of being moved either straight ahead or perhaps may have been at an angle. Incontrovertibly it was an awkward pull. He engaged in activity being an activity that he honestly and reasonably believed to be one that he was to undertake. He did so and he fell. The reasonable steps that could have been taken to avoid it was a simple instruction and direction.”

71.    Tcpt, p 345(15)-(20).

97. It is clear that both factual bases upon which the existence of a locking mechanism was put to the trial judge in written submissions were mistaken. Accordingly the finding as to the mechanism of the accident must be rejected. If the finding were to be maintained on some other basis, it would be necessary to consider the evidence supporting it with great care, given that it was not pleaded, it was not dealt with by the expert, it was not established by the plaintiff’s evidence, nor was it the focus of any oral submission on behalf of the plaintiff. All that can be said in favour of the inference is that (a) at some stage the trolleys had a locking mechanism of unidentified nature, and (b) when on this particular occasion the plaintiff applied force to the trolley with one hand, he lost his grip before it moved. Those two factors are insufficient to establish on the balance of probabilities that the accident resulted from a trolley, which had never before been locked, having been locked on that occasion.

(f)   reasonable precautions

98. Assuming for present purposes that the Club knew that the plaintiff was moving the empty trolleys, each day, a distance of 8-10 metres from one part of the corridor to a position outside the door of the counting room, what steps should the Club reasonably have taken in exercise of its duty of care?

99. Assuming that the very minor involvement of the plaintiff with moving one trolley each day had been known to supervisors working for the Club, there is no reason to suppose that the manager of the Club with authority under the contract with Sermacs to give directions to the plaintiff would have told him not on any account to move or attempt to move a trolley, in his own interests. It is possible that a supervisor might have considered whether such action would have interfered with the proper exercise of his functions as an armed guard and, if satisfied that it would, might then have given a direction not to do it. That would involve a degree of speculation in which it is not necessary to engage. The action, albeit undertaken daily, was likely to have taken less than a minute. A supervisor witnessing such an action might have deemed the distraction trivial; the supervisor might well have failed to identify any significant risk attaching to the activity.

100. Even that last question was not squarely put to Mr Muir. Counsel for the plaintiff asked him about two matters which came close but did not squarely address the issue. The first exchange was as follows: [72]

“Q. But if a supervisor had seen Mr Gazis move a trolley, either towards the soft room or slightly away from it, you would expect a supervisor to report that to you. Is that right?

A. It’s hard to say, you know. Like it depends on in their frame of mind what they see as being a real problem or not, you know. I don’t know, and it may be something that you’re not even thinking about. Like who would think about that sort of thing. But anyhow, you would have to ask them, I think. I don’t know. They wouldn’t be up there generally at all, so they just wouldn’t be in that area.”

72.    Tcpt, p 162(45).

101. Reporting to Mr Muir did not expressly address what would have been said to the plaintiff. Counsel returned to the general area, referring Mr Muir to the statement in an occupational health and safety management policy that it was the duty of all managers and supervisors, amongst other things, to investigate hazard reports and ensure that corrective action was taken. Mr Muir was then asked: [73]

“Q. To your understanding would someone who is not employed to handle the coin boxes and push or pull the trolleys be engaging in conduct if they did push and pull that trolley that would be a hazard?

A. Yep, more than likely, yeah. Again it’s whether a duty manager or supervisor would see that as a hazard.”

73.    Tcpt, p 167(5).

102. This latter questioning was problematic in a different way. The inference appears to have been that a supervisor would be required to investigate and take action if a hazard had been identified. The question itself was clearly directed to activity on the ground floor where the boxes were being collected and the trolleys were being manoeuvred. In any event, no question was asked of Mr Muir, who was undoubtedly the relevant witness, as to whether the plaintiff would have been directed not to move an empty trolley in the manner in which he was accustomed to do so, if seen to do so by a supervisor. On the basis of the evidence set out above, what Mr Muir would have said if asked such a question is entirely a matter of speculation and not of inference. In the circumstances, there was an absence of material from which to infer that a reasonable person in the position of a Club supervisor would have taken the course of giving such a direction. That, as Mr Muir correctly observed, would depend upon an evaluative judgment as to the nature of the risk and, in terms of s 5B(2)(a), the probability that the harm would occur if the direction were not given. The plaintiff did not establish that such a direction should reasonably have been given.

(g)   the Club’s knowledge of plaintiff’s activities

103. Given these conclusions, the question of the actual or even constructive knowledge of the Club is not determinative of the Club’s liability. Nevertheless, it is convenient to deal with it as it was the focus of a number of findings and was addressed in submissions. First, the trial judge appears to have accepted Mr Muir’s evidence (or it may have been Mr Harder’s evidence) that he did not see Mr Gazis move a trolley. The judge stated:[74]

“One of the senior managers of the Club testified to the fact that he had never seen Mr Gazis move a trolley. This is not particularly unexpected and is not inconsistent with the practice that Mr Gazis moved the trolleys. The senior manager called was not a person who was stationed regularly, or at all, on the first floor adjacent to the soft room.”

74. Gazis at [57].

104. When moving from some general propositions to consideration of “Principles on Liability” the judge stated:[75]

“I have accepted the evidence of Mr Gazis. That evidence includes the proposition that Mr Gazis moved the trolleys from time to time. Such an occurrence would have been known (and I infer was known) to employees of the Club. It was not known to Mr Muir, the manager called to give evidence. Yet it would have been known (and I infer was known) to employees who worked in the soft room. No such employee was called. The Club has the knowledge of its employees.”

75. Gazis at [70].

105. The trial judge also stated:[76]

“The Club failed to provide a direction to Mr Gazis not to move, or assist with the moving, of the trolleys, despite being aware that the trolleys were moved from the lift across the first floor when being transported to the soft room and that, by virtue of Mr Gazis's location and his duty to assist employees to gain access to the first floor via the lift, he was likely to assist employees transporting the trolleys. The Club knew that Mr Gazis assisted other employees and moved trolleys on a regular (daily) basis”

76. Gazis at [100].

106. If these findings go further than those set out by the judge in [70] (at [104] above), they were not supported by the evidence. There was no suggestion that Mr Gazis did anything to assist the movement of the trolleys from the lift to the counting room. His duty was to control the lift as part of his security function. To “assist” other people who moved trolleys could not mean that he assisted in the moving of the trolleys; no-one suggested that that occurred.

107. The slide from the particular to the general also appears in the following passage:[77]

“The work practices of the Club, bearing in mind the Club's knowledge that Mr Gazis moved the trolleys on occasion or could have moved the trolleys on occasion by virtue of his location in the Club premises, presented Mr Gazis [sic] with a foreseeable risk of harm that the Club was required to ameliorate.”

77. Gazis at [102].

108. Counsel for the plaintiff in this Court submitted that it was appropriate to identify the nature of the risk at a high level of generality, in considering the question of duty. That may be accepted; nevertheless, more precise findings are required in dealing with breach (and in determining the scope of the duty) and the propositions in this passage impermissibly blur the precision with which the offending conduct was identified in the evidence.

109. The final passage in the reasons, which is consistent with that at [70] read as follows:[78]

“On the other hand, the Club was aware, through its employees in the soft room, that Mr Gazis moved the trolleys. It should have been aware, even if those employees had not observed such a practice, that a person whose duties included bringing up to the first floor the lift with trolleys in it would, ordinarily, seek to move those trolleys, even if it were only out of the lift.”

78. Gazis at [125].

110. There was no finding that Club supervisors knew of the plaintiff’s activities. The only evidence suggesting that supervisors witnessed his activity in moving a trolley each day was that of the plaintiff himself. It was vague and unsupported, except in relation to two named managers, both of whom gave unchallenged evidence denying seeing him, or any other security guard, engaged in moving trolleys. Understandably in these circumstances, there was no notice of contention seeking to support the findings of the trial judge with respect to liability by reference to knowledge of managers or supervisors.

111. Accordingly, the finding by the judge as to liability depended upon the proposition that “[t]he Club has the knowledge of its employees.” The employees in question were those who worked in the counting room, who may not have seen the trolley being moved but knew that the trolley had been moved a few paces while they were undertaking their work and that only the plaintiff had a regular opportunity to do that.

112. It is not correct that the knowledge of every employee of the company, particularly as to the activities of independent contractors having different functions on the company’s premises, becomes the knowledge of the company. As Spigelman CJ noted in Nationwide News Pty Ltd v Naidu [79] “[w]hether a principal is affected by an agent’s knowledge depends upon the context.” Further, “[w]hether the knowledge of a particular person should be imputed to a corporation depends on the scope of that person’s employment.”[80] The Chief Justice continued, by contrasting the functions of specific officers who gave evidence with, “[a] person in a supervisory position … [who] has duties which encompass the receipt of the relevant knowledge and accordingly, could be said to have a duty to communicate and/or act upon it … [t]hat cannot be said to be the case for the other employee witnesses.”[81]

     79. (2007) 71 NSWLR 471; [2007] NSWCA 377 at [40].

     80. Naidu at [41].

     81. Naidu at [41].

113. The Chief Justice also said that “[a] felicitous description of a person whose knowledge will be imputed to a corporation is an ‘agent to know’.”[82] There was no basis in the evidence for imputing the knowledge of any of the staff working in the counting room, as to the activities of the security officer outside that room, to the Club.

     82. Naidu at [43].

114. Because Mr Muir was adamant that the guards, and particularly an armed guard with a walkie-talkie radio, needing to have his arms free, should not be moving trolleys, the element of negligence must have been in failing to instruct him not to move trolleys, rather than in failing to instruct him how to do so safely. In the absence of knowledge that he was in the habit of moving trolleys, there should have been a finding that the duty of care owed to the plaintiff by the Club did not extend to giving such a direction. Accordingly, the finding of negligence on the part of the Club should be set aside on that basis also.

(3)   Liability of employer

115. Part 5 Div 3 of the Workers Compensation Act applies to an award of damages in respect of injury to a worker caused by the negligence of the worker’s employer. [83] The Civil Liability Act does not apply to the liability relating to such an award. [84] The Workers Compensation Act modifies common law principles, particularly in relation to the assessment of damages. It does not, however, modify the common law principles with respect to duty, breach of duty or causation.

     83. Workers Compensation Act, s 151E(1).

     84. Civil Liability Act, s 3B(1)(f).

116. The nature of the obligation owed by an employer to an employee was explained by the High Court in Czatyrko v Edith Cowan University:[85]

“An employer owes a non-delegable duty of care to its employees to take reasonable care to avoid exposing them to unnecessary risks of injury. If there is a real risk of an injury to an employee in the performance of a task in a workplace, the employer must take reasonable care to avoid the risk by devising a method of operation for the performance of the task that eliminates the risk, or by the provision of adequate safeguards. The employer must take into account the possibility of thoughtlessness, or inadvertence, or carelessness, particularly in a case of repetitive work.”

85. [2005] HCA 14; 79 ALJR 839 at [12] (citations omitted).

117. Although the duty is described as “non-delegable”, it is not an obligation to ensure safety at work: it is an obligation to take reasonable care to avoid exposing a worker to unnecessary risk of injury. The scope of that obligation will vary depending upon the nature of the working environment. For a courier or delivery driver, the working environment will be mainly external to the employer’s premises. In the present case, as is common with labour hire arrangements, there was a specific place of work, but it was not under the control of the employer.

118. The plaintiff’s employer had supplied him with a gun and a uniform (in turn supplied to Mr Kalls by Sermacs). Mr Kalls (on behalf of the employer) understood that the plaintiff was to perform duties as an armed guard at the Club. Neither Mr Kalls nor any other supervisor from the employer visited the Club to inspect the premises upon which the plaintiff was to carry out his duties. On the other hand, there was no aspect of the physical layout of the premises which gave rise to any injury. Nor, had the system of work been explained, would it have included the movement of trolleys. Accordingly, any steps reasonably expected of the employer would not have given rise to further instructions.

119. When the injury occurred, the plaintiff had been employed by MPS for almost a decade and, for the same period, had had the responsibility of carrying a gun. In addition, for the past three years, on a weekly or fortnightly basis, he had transported liquor for Mr Kalls, being on average “about 40 boxes of alcohol” which he had to move from his car to a trolley and deliver it to Harbourside Liquor Store. Mr Kalls described the boxes as containing a dozen 750ml bottles. The plaintiff had also worked as a “cash escort”. He was a man of mature years, who undertook responsibilities.

120. The plaintiff did not suggest that Mr Kalls had given him instructions to move trolleys or otherwise make himself useful whilst undertaking duties as an armed guard.

121. The fact that MPS did not control the Club did not mean that it did not have obligations to take reasonable steps to obtain a safe working environment. In effect, Mr Kalls relied upon what he was told by the plaintiff and, implicitly, the arrangement between Sermacs and the Club. If Sermacs had been negligent in that regard, MPS would not have escaped liability. But the trial judge found that Sermacs was not liable. It is necessary, therefore, to identify the basis upon which MPS was found to be liable. After noting that Sermacs had no duty to provide a safe system of work, the trial judge continued:

“[150]   MPS, on the other hand, was Mr Gazis' employer. Its duty was to provide a safe system of work. MPS took no steps to ensure that the conditions under which its employee was working were safe. It has breached its duty of care and is liable in negligence.

[151]   Nevertheless, as earlier stated, the opportunity for it to assess the system of work under which its employee was operating were extremely limited. It did not provide the system of work or dictate the performance of work, other than in the sense that every employer so dictates.

[152]   Further, an inspection of the Club and the conditions under which its employee was working would not have necessarily, or probably, ascertained the particular risk that has caused the damage to Mr Gazis.

122. This reasoning starts from a false premise, namely that there was a duty to provide a safe system of work: the duty was to take reasonable steps to ensure that the plaintiff was not exposed to unnecessary risks of injury. Implicitly, the third paragraph in this reasoning identified an inspection of the Club as the appropriate step required, but concluded that such an inspection would probably not have identified the particular risk which materialised. The proper conclusion in these circumstances was that, whilst MPS owed a duty and was in breach of it, because it took no reasonable steps to investigate the working environment in which its employee was placed on a semi-permanent basis, the breach was nevertheless not causative of the harm which eventuated because the risk would not have been identified on any reasonable inspection.

123. For these reasons, MPS was not liable and the judgment against the Workers Compensation Nominal Insurer should be set aside.

Other matters

124. Because the appeals by both parties held liable to the plaintiff should be allowed and the orders in favour of the plaintiff against each must be set aside, a number of other questions fall away. Some have been referred to in passing above.

125. Although Sermacs had settled proceedings brought against it by the plaintiff, it was sued pursuant to cross-claims brought by both MPS and the Club. The issues raised by the cross-claims are no longer relevant and the orders made dismissing the cross-claims should stand.

126. There was also an issue as to the basis upon which it was anticipated that the Workers Compensation Nominal Insurer would be entitled to recover an amount of compensation which had been paid to the plaintiff. The amount was identified in the orders made at trial, but the calculation was not before the Court. A difficulty with the form of the orders finally made was that the judge left the calculations to the parties, based on the findings set out in his judgment. It was said that the amount of any weekly payments of compensation already paid were to be deducted from the damages recoverable by the plaintiff from his employer, pursuant to s 151A of the Workers Compensation Act. (That amount is to be paid to the person, being the insurer, who paid the compensation.) There was then a calculation required in respect of indemnification of the insurer by any third party tortfeasor, in this case being (according to the judgment of the trial judge) the Club. The indemnity provided by s 151Z(1)(d) does not apply to an employer who is also a tortfeasor (as found by the trial judge), unless the terms of s 151Z(2)(e) are engaged. [86] As it appeared that the employer could not bring itself within the conditions to the engagement of subs (2)(e), it would not be entitled to an indemnity under subs (1)(d). No issue was identified as to the inter-relationship of those provisions and s 151A, although it is by no means clear that such an issue would not have arisen on the calculations undertaken by the parties.

     86. See Endeavour Energy v Precision Helicopters Pty Ltd (No 2) [2015] NSWCA 357 at [44]-[48].

127. The Club also raised a challenge to the assessment by the trial judge of non-economic loss and past and future domestic care. These issues were dealt with in a number of conclusory paragraphs. The judge identified the assessment of damages with respect to domestic care as “[t]he major issue between the parties in relation to damages”. [87] Some aspects of the evidence, which were described by the judge as “uncontroversial”, were said to be controversial; the description of the plaintiff’s evidence as to his needs for care and the evidence of his wife, which were described as “largely uncontested”, were neither entirely consistent nor entirely uncontested. Although the matter was not approached in this way, there was a real issue as to the adequacy of the reasons given by the trial judge for aspects of the award of damages, none of which were discussed in monetary terms, except by reference to the plaintiff’s schedule of damages, the details of which were, for the most part, not identified in the judgment. Accepting that the judge had referred earlier in his reasons to the evidence of the medical experts and the conditions affecting the plaintiff as a result of his injury, the defendants were nevertheless entitled to some clearer explanation of the findings which ultimately resulted in an assessment in excess of $1.5 million and a judgment against the Club of almost $1 million. Because neither the Club nor the employer should have been found liable, it is not productive to pursue these matters.

     87. Gazis at [166].

Orders

128. The principal orders were made and entered on 1 December 2014. The orders were in accordance with short minutes of orders filed by the parties. It would have been desirable for greater care to be paid to the terms of the orders before they were entered. Again, because the findings of the Court on appeal will require that the substantive orders be set aside, it is not necessary to consider the difficulties arising from their formulation.

129. The document provided to the Court on appeal, issued by the Principal Registrar of the Court on 24 August 2015, included orders as between the plaintiff and the second and third defendants. The title of the proceedings referred to the first plaintiff and the first and second defendants. There was only one plaintiff; there was a third defendant (singular), being the Workers Compensation Nominal Insurer (bearing the liability of the employer). The orders required the Club to pay the insurer an amount described as “the statutory indemnity”, pursuant to s 151Z of the Workers Compensation Act, being some $233,000. It also required payment by the Club to the plaintiff (although it did not say so) of the sum of approximately $930,000. There was no payment due from the third defendant to the plaintiff. No doubt for that reason, order (6) provided that there be no order as to the costs between the plaintiff and the third defendant. The insurer did not seek an order for costs of the trial.

130. Although the plaintiff was unsuccessful at trial against Sermacs, no order or judgment was made with respect to that claim. Sermacs, no doubt because it was only present on the appeal to resist the reagitation of the cross-claims, did not seek any variation of the orders made at trial. Nevertheless, it is necessary that an order be made disposing of those proceedings. In the absence of any application, there should be no order as to the costs of those proceedings.

131. Finally, it is to be noted that, on 10 December 2014, further orders were made including orders dismissing each of the five cross-claims and an order staying the enforcement of the judgment entered on 1 December 2014. There was still no order in relation to the costs of the cross-claims, which were reserved. As no further orders have been entered on JusticeLink, it may be assumed that those matters have been sorted out between the parties. Further, as the stay was in place in relation to the whole of the judgment, and the plaintiff continued to be paid weekly compensation payments, there is no question of reimbursement.

128. In these circumstances, the Court should make the following orders:

1. Allow the appeal by South Sydney Junior Rugby League Club Ltd in respect of the judgment in the Common Law Division given on 17 November 2014 and the orders with respect to the appellant entered on 1 December 2014.

2. Allow the appeal by the Workers Compensation Nominal Insurer in respect of the judgment and orders referred to above.

3. Set aside orders (1)-(5) made and entered on 1 December 2014 and in place thereof:

1. dismiss the proceedings brought by the plaintiff Ross Gazis against the second and third defendants in proceedings 2009/335151 in the Common Law Division;

2. order that the plaintiff pay the costs of the trial of the second defendant, South Sydney Junior Rugby League Club Ltd.

4. Order that the first respondent, Ross Gazis, pay the costs of the appellants, South Sydney Junior Rugby League Club Ltd and the Workers Compensation Nominal Insurer, in this Court.

5. Grant the first respondent a certificate under the Suitors’ Fund Act 1951 (NSW) with respect to the costs of both appeals.

133. MACFARLAN JA: I agree with Basten JA.

134. SIMPSON JA: I agree with Basten JA.

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Endnotes

Amendments

09 February 2016 - [126] Amended s 151Z(1)(b) to (d)

Decision last updated: 09 February 2016