Unilever Australia Limited v Pahi; Swire Cold Storage Pty Limited v Pahi

Unilever Australia Limited and Swire Cold Storage Pty Limited (the appellants) appealed to the New South Wales Court of Appeal against a judgment in favour of Mr Pahi (the respondent). The dispute concerned Mr Pahi's claim for damages for personal injuries sustained while working on a construction site. Mr Pahi was an employee of an independent subcontractor engaged by the appellants, who were the principal contractors.

The Court of Appeal was required to determine whether the appellants, as principal contractors, owed a duty of care to the employees of their subcontractors, and if so, what the scope and standard of that duty were. Specifically, the court considered whether the duty owed by a principal contractor to an employee of a subcontractor was co-extensive with the duty owed by an employer to their employee, and whether the standard of care required the principal contractor to take all measures within its power to obviate dangers.

The Court of Appeal applied the principles established in *Leighton Contractors Pty Limited v Fox* [2009] HCA 35. It held that while a principal contractor owes a duty of care to the employees of its subcontractors, this duty is not necessarily co-extensive with that of an employer. The scope of the principal's duty is determined by the degree of control it exercises over the work being performed and the specific risks involved. The court found that the appellants did not exercise sufficient control over the specific work that led to Mr Pahi's injury to render them liable. The standard of care required of a principal contractor does not extend to taking all possible measures to obviate dangers, but rather to taking reasonable steps to prevent foreseeable risks of injury arising from the work over which it has control.

Consequently, the Court of Appeal allowed the appeals, set aside the trial judge's orders, and entered judgment for the appellants. The respondent was ordered to pay the appellants' costs at first instance and of the appeal, with a certificate under the *Suitors’ Fund Act 1951* granted to the respondent if qualified.