Victorian WorkCover Authority v Australia Post & Macedon Village Pty Ltd
[2015] VCC 1419
•18 September 2015
| IN THE COUNTY COURT OF VICTORIA AT Melbourne COMMON LAW DIVISION | Revised Not Restricted Suitable for Publication |
GENERAL LIST
Case No. CI-11-04678
| VICTORIAN WORKCOVER AUTHORITY | Plaintiff |
| v | |
| AUSTRALIA POST | First Defendant |
| and | |
| MACEDON VILLAGE PTY LTD | Second Defendant |
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JUDGE: | HIS HONOUR JUDGE PARRISH | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 28, 29, 30 and 31 July 2014, 25 and 26 September 2014 and 27 October 2014 (Defendants to file and serve written submissions within 14 days of 26 September 2014 and thereafter the plaintiff to file and serve written submissions within 7 days – later extended to 4.00pm on 31 October 2014 – with each of the defendants to file and serve a reply (if they so choose) by Wednesday, 5 November 2014) | |
DATE OF JUDGMENT: | 18 September 2015 | |
CASE MAY BE CITED AS: | Victorian WorkCover Authority v Australia Post & Macedon Village Pty Ltd | |
| MEDIUM NEUTRAL CITATION: [First revision 23 September 2015] | [2015] VCC 1419 | |
REASONS FOR JUDGMENT
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Subject: ACCIDENT COMPENSATION
Catchwords: Victorian WorkCover Authority seeks indemnity from third parties in relation to compensation paid to injured worker – whether either defendant has a “liability to pay damages” to injured worker – whether there is any relevant duty owed by the first or second defendant to the injured worker – injury to worker caused by criminal activity – application of Part X Wrongs Act 1958 – whether first defendant is an “occupier” – the application of the principles enunciated in Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254
Legislation Cited: Accident Compensation Act 1985, s138; Wrongs Act 1958, Part X; Workers Compensation Act 1958; Compensation Superannuation Legislation Amendment Act 2008
Cases Cited:Victorian WorkCover Authority v Kenman Kandy Pty Ltd & Ors (2002) 6 VR 666; Esso Australia Ltd v Victorian WorkCover Authority & Anor (2000) 1 VR 246; Victorian WorkCover Authority v Esso Australia Ltd (2001) 207 CLR 520; DSG Pty Ltd v Victorian WorkCover Authority (2008) 20 VR 514; Jones v Bartlett (2000) 205 CLR 166; Central Goldfields Shire v Haley & Ors (2009) 24 VR 378; Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; Karatjas v Deakin University [2012] VSCA 53; Adeels Palace Pty Ltd v Moubarak (2009) 239 CLR 420; Lesandu Blacktown v Gonzalez [2013] NSWCA 8; Strong v Woolworths Ltd (2012) 246 CLR 182; Powney v Kerang and District Health [2014] VSCA 221, TAB Limited v Beaman [2006] NSWCA 345; Victorian WorkCover Authority v Jones Lang LaSalle (Vic) Pty Limited [2012] VSC 412; March v Stramare (E & M H) Pty Ltd [1991] HCA 12; Wallace v Kam (2013) 250 CLR 375; Bainbridge v James (trading as James Leigh Promotions) & Ors [2013] VSCA 12; Leighton Contractors Pty Ltd v Fox (2009) 240 CLR 1; Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 66; Ogden v Bells Hotel Pty Ltd [2009] VSC 219; Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254
Judgment: Judgment for the defendants.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr P B Jens QC | Russell Kennedy |
| For the First Defendant For the Second Defendant | Ms S Manova Mr I D McDonald | Clarke Legal Moray & Agnew |
HIS HONOUR:
1 Pursuant to s138 of the Accident Compensation Act 1985 (as amended) (“the Act”), the Victorian WorkCover Authority (“the plaintiff”) seeks an indemnity from Australia Post (“the first defendant”) and Macedon Village Pty Ltd (“the second defendant”), in respect of compensation paid to and on behalf of Sotiria Velissaris (“the worker”) pursuant to the provisions of the Act.
2 There is no dispute that as at 16 December 2003, “the worker” was employed by the YMCA of Manningham Incorporated, trading as Aquarena Aquatic & Leisure Centre (“the employer”) as a customer service team leader. Further, there is no dispute that the worker, during the course of such employment, at approximately 5.30pm on 16 December 2003, attended a licensed post office situated at 10 Macedon Road, Templestowe Heights and was present during an armed robbery at such premises.
3 Again, there is no dispute that the worker suffered personal injury – a significant psychological injury – as a result of experiencing the robbery, and made a claim for compensation against her employer pursuant to the provisions of the Act. Such claim was accepted and the worker has been paid a substantial amount of compensation, and such payments are continuing.
4 The plaintiff tendered a Certificate dated 18 July 2014 pursuant to s239A of the Act which sets out the compensation, mainly consisting of weekly payments and medical and like expenses. [1]
[1]See exhibit 4 – Plaintiff’s Court Book (“PCB”) pages 59 – 80
The Second Defendant
5 At all material times, the second defendant was the trustee for the Albanis Family Trust. John Albanis (“Albanis”) and his brother, George Albanis, were respectively the chairperson and director of the corporate entity.
6 By application dated 11 December 2001, the second defendant applied to operate the Templestowe Heights Licensed Post Office situated at 18 Macedon Road, Lower Templestowe which was already in operation.[2]
[2]See exhibit 8 – Application for license to operate a licensed post office dated 11 December 2001 at PCB pages 145-153
7 Ultimately, an agreement was entered into by the first defendant and the second defendant whereby the first defendant agreed to grant a licence to the second defendant to operate a licensed post office at 18 Macedon Road, Lower Templestowe on the terms and conditions contained within the agreement. The commencement date of such agreement was 2 April 2002.[3]
[3]See exhibit 11 – Copy Licensed Post Office Agreement for Templestowe Heights Licensed Post Office at PCB pages 158 – 198
8 The robbery took place at the licensed post office situated at 10 Macedon Road, Lower Templestowe – not 18 Macedon Road, Lower Templestowe. During the course of the trial, there was some issue as to when the first defendant commenced business at 10 Macedon Road, Templestowe Heights.
9 Albanis gave evidence and adopted a Witness Statement made by him on 11 August 2014 to which there were attached various copy documents.[4] Consistent with the material to which I have already referred to and the evidence of Albanis, I make the following findings:
[4]See exhibit A
(a) In early 2003, Albanis and his brother became aware that the larger premises situated at 10 Macedon Road, Templestowe Heights might become available and as such premises were much larger, with the floor space about three or four times of that of the premises situated at 18 Macedon Road, Templestowe Heights, they decided to relocate to 10 Macedon Road, Templestowe Heights;
(b) Initially, the Lease of 18 Macedon Road, Templestowe Heights which had been transferred to Macedon Village Pty Ltd effective from 2 April 2002 was surrendered on certain terms effective from 1 September 2003;[5]
[5]See exhibit A and in particular, Annexure C
(c) Albanis and his brother advised Australia Post of their intention, after which followed a fit-out of the new premises;
(d) Albanis and his brother, or more particularly, Macedon Village Pty Ltd, was required to quit the premises at 18 Macedon Road, Lower Templestowe by 1 September 2003. Albanis gave evidence, which I accept, that when the fit-out was being carried out at 10 Macedon Road, Templestowe Heights, trade was carried on as usual from number 18 Macedon Road, Templestowe Heights given that it was a condition of the relocation from the first defendant that there not be any interruption to postal services;
(e) Albanis gave evidence, which I accept, that the actual move took place over the course of a weekend some time in early September 2003.
10 I shall refer to the premises situated at 18 Macedon Road, Templestowe Heights as “the previous premises” and the premises situated at 10 Macedon Road, Templestowe Heights as “the new premises”. I also note that Albanis and his brother carried on the business at the new premises until some time in 2006.
The robbery
11 It is probably pertinent to give some description of the circumstances of the robbery as various witnesses were questioned about certain aspects of the robbery. In an earlier Statement dated 16 December 2003,[6] Albanis states:
[6]See exhibit A at PCB pages 129 – 132
“At about 5.25pm on the 16th of December, 2003, just before closing time, I was behind the counter, just coming back out from the rear office area. George was at the counter serving a lady customer.
The store runs east/west, the front door is the western end. There is one main room which has display stands running up the middle, then the counter goes across, north/south with a small half door at the southern end of the counter which allows access behind the counter. It has a combination lock on it but at the time this door was open. Immediately east of that door about 3m is another doorway leading out to the rear of the store. This is used as office and storage space. This is the door I was coming back through, I heard a male voice a[t] the sa[m]e time saw the male, walking towards the counter from the front door on the northern side of the display stands nearest the north wall. He said, ‘Open the drawers’. When he said this he was almost to the counter. My first thought, due to this male[’]s very casual approach was that it was a joke. Then I heard another male voice saying, ‘Everyone sit down’. The person saying this had come down the southern side of the display stands towards the counter. There were several customers in the shop including the Lady George was serving.
The guy who was telling everyone to sit approached the counter access door and I could see he was carrying some sort of gun in his left hand, and a blue sports bag in his right. I don’t think he had any words written on it. The gun was pointing towards the floor and it looked about 3 feet long, like a sawn rifle or shotgun, rather than a pistol. He seemed to have put part of it up his arm to his armpit and the barrels were down past his hand. I had no doubt the gun was real and I was shocked straight away that this could happen to me.
…
It took about 5 seconds and everyone was sitting on the ground. I sat down right next to the door I had just come through just to the northern side of the doorway.
The male with the gun ran straight through the counter access door, past me and out the back to the office area. The other male then also came through behind the counter but he didn’t go out the back, he went over to the northern end of the counter to where George was seated on the floor. He was taking money out of the till drawers but he hesitated a bit because he must have been waiting for the other guy to come back with the bag. Less than a minute later, the guy with the gun came back out from the office, and went past me over to the other guy and started taking the money from the till drawers. There are three tills and they took money from all of them.
They were only there for about 30 seconds, then they both just ran back out the access door, and out of the store. As they were going one of them [was] yelling ‘Nobody move’. Then they were gone. I would say, the whole thing probably took maximum two minutes.
… .”
12 Both Albanis and other witnesses saw the two robbers get into a car outside the new premises driven by a third man, after which they sped off.
13 I also refer to the various colour photographs tendered by the plaintiff which details the internal layout of the new premises at the time of the robbery, together with photographs taken from outside the new premises.[7]
[7]See exhibit 5 at PCB pages 108 – 120 which sets out the various colour photographs
14 I also refer to an email from Mathew Davis (“Davis”), Corporate Security Group, of the first defendant to Christopher Stone dated 13 May 2004, wherein he confirms that as a result of the robbery, there was a loss of Australia Post money, amounting to $15,532.58, which was taken from the counter drawers, and the sum of $4,837.00, being licensed post office money, which was taken from a safe.[8]
[8]See exhibit 17 at PCB pages 294
15 In an earlier email dated 17 December 2003 from Davis to Richard Walsh, Davis noted that the new premises were “not fitted with Security Cameras and have not yet been fitted with Time Lock Cash Containers”.[9]
[9]See exhibit 17 at PCB page 290
16 In his later Statement,[10] Albanis asserts that it seemed to him from “the manner and speed with which it … [the robbery] … was executed that it was very professional. In particular, the robbers seemed very calm and knew precisely what they had to do once they entered the premises.”
[10]See exhibit B
17 Furthermore, he describes that immediately prior to the robbery, he was working in the back office counting money in preparation for it to be placed in the “two key safe”. Before making such a deposit, he had to leave the back office and go to the cash register to key in the deposit amount to obtain the cash register slip. He describes the robbery occurring when he was leaving the back office, but considers this was “purely coincidence”.
18 In particular, Albanis also asserts:
“Most of the money that was stolen had been in the second safe located in the back room. I’d opened the safe. I removed the money in order to count it on the bench prior to it being placed in the Armaguard safe for overnight storage. I counted the money and then George … [his brother] … was required to come in to the back room and count it as well in order to verify the amount. Accordingly at the commencement of the robbery I was moving from the back room into the shop to swap over with George as the last customers were dealt with. Each cash drawer normally holds about $1,000 in cash.
Our basic float for the day was $1,000 in notes for each of the three registers, plus about $2,000 in change. The bulk of the money that was taken was in transit from the overnight safe to the Armaguard safe. Normally the door was kept closed and the money counting was done out of sight of the public.”
Section 138 of the Act
19 When the Act commenced in 1985,[11] s138 consisted of a single paragraph in similar terms to the earlier s62(b) of the Workers Compensation Act 1958, which Act, in general terms, applies to industrial accidents in Victoria before 4.00pm on 31 August 1985.
[11]See Act No 10191 of 1985
20 Section 138 has undergone various amendments and indeed, in 1994, a new s138 was substituted and was deemed to operate from 1 December 1992. The new s138 was in similar (but not the same) terms as the present s138. By Act No 60 of 1996, a new formula was substituted for the previous formula contained in s138(3)(b) of the Act.
21 Given the date of injury suffered by the worker, it is the version of s138 which existed at that time which is applicable. I refer to Victorian WorkCover Authority v Kenman Kandy Pty Ltd & Ors[12] at paragraph 15, wherein Batt and Vincent JJA (with whom Ormiston J agreed), stated:
“Section 138(1) confers an enforceable right, of definite and calculable extent, which arises upon the happening of the death or injury concerned, and determines the position for each of the affected parties. The right is one to be indemnified ‘in accordance with this section’, which prima facie means the section as existing at the time the event happens. That provides the measure. … .”
[12](2002) 6 VR 666
22 However, s299 of the Act provides:
“Section 138, as amended by section 8 of the Compensation and Superannuation Legislation Amendment Act 2008, applies in respect of any right of indemnity, regardless of when that right came into existence, unless before the commencement of that section—
(a) the amount of the indemnity has been determined; or
(b) judgment for damages has been given or entered; or
(c)there has been a settlement or compromise of the claim in respect of which the right of indemnity arose.”
23 Section 8 of the Compensation Superannuation Legislation Amendment Act 2008 states:
“(1) In sections 138(1) and 138(2) of the Accident Compensation Act1985 for ‘legal liability in a third party to pay damages’ substitute ‘liability in a third party to pay damages or that would have created such a liability if the injury or death had been caused in Victoria’.
(2) In section 138(3)(b) of the Accident Compensation Act 1985—
(a)after ‘amount calculated’ insert ‘were it not for the provisions of this Act, the Transport Accident Act and Parts VB, VBA and X of the Wrongs Act 1958;
(b)after ‘injury or death’ omit ‘were it not for the provisions of this Act and the Transport Accident Act 1986.”
24 Accordingly, s138 of the Act reads, in respect of this claim for indemnity, as follows:
“(1)Where an injury or a death for which compensation has been paid, or is or may be payable, by the Authority, a self-insurer or an employer was caused under circumstances creating a liability in a third party to pay damages or that would have created such a liability if the injury or death had been caused in Victoria or that would, but for section 134A, create such a liability in respect of the injury or death, the Authority, self-insurer or employer is entitled to be indemnified by the third party in accordance with this section.
(2)In determining for the purposes of subsection (1) whether an injury or death was caused under circumstances creating a liability in a third party to pay damages or that would have created such a liability if the injury or death had been caused in Victoria in respect of the injury or death, Divisions 8A and 9 of Part IV must not be taken into account.
(3)The amount which a third party is required to pay as indemnity under subsection (1) is the lesser of—
(a)the amount of compensation paid or payable under this Act in respect of the injury or death; and
(b)the amount calculated, were it not for the provisions of this Act, the Transport Accident Act 1986 and Parts VB, VBA and X of the Wrongs Act 1958, in accordance with the formula—
where—
Xis the extent, expressed as a percentage, whereby the third party’s act, default or negligence caused or contributed to the injury or death;
Ais the amount of damages (disregarding the extent, if any, whereby any other person’s act, default or negligence caused or contributed to the injury or death) for pecuniary loss and non pecuniary loss which the third party is or would have been liable to pay in respect of the injury or death;
Bis the amount recovered or recoverable by the Authority, the self-insurer or the employer under section 137 from the Transport Accident Commission (otherwise than under a settlement);
Cis the amount paid by the third party in respect of the injury or death to the worker or the dependants of the worker under any settlement of, or judgment in, an action by the worker or dependants of the worker against the third party.
(4)…
(5)… .”
25 The High Court[13] has approved the comments of Winneke P in Esso Australia Limited v Victorian WorkCover Authority & Anor,[14] when he described the nature of the indemnity under s138 of the Act in the following way:
“… [T]he statutory right of indemnity conferred by the Act upon the person who has paid the compensation is not to be equated to the cause of action which the worker would, but for the Act, have had against the person liable to pay damages to him. This is so notwithstanding the fact that it is an ingredient of the statutory right, sought to be enforced, that the person from whom the indemnity is sought was liable to pay damages to the worker. The claim to enforce the entitlement to indemnity is not a claim in tort. It is a cause of action created by statute for an indemnity against a person liable to pay damages to another … .”
[13]See Victorian WorkCover Authority v Esso Australia Limited (2001) 207 CLR 520 at 527
[14](2000) 1 VR 246 at 257
26 There is no issue that the first and second defendants can be third parties as contemplated by s138(1) of the Act.[15]
[15]See DSG Pty Ltd v Victorian WorkCover Authority (2008) 20 VR 514 and in particular, paragraphs [87] – [89]
The pleadings
27 The plaintiff alleges that:
(a) At all material times, the first and/or second defendant was the owner, occupier, and responsible for the care, conduct and management of the new premises;
(b) At all material times, the first defendant was responsible for selecting and/or approving the location and fit-out of the new premises;
(c) At all material times, the first and/or second defendant promoted its facilities and services and actively encouraged customers to utilise the services and facilities;
(d) On or about 16 December 2003, the worker was lawfully at the new premises carrying out work for the employer.
28 In such circumstances, it is alleged that the first and/or second defendant owed a duty to the worker to take reasonable care in relation to the management, condition, maintenance and safety of the new premises and its plant and equipment. Further, it is alleged that the first and/or second defendant owed the worker a duty to take reasonable care, such that the design and fit-out of the new premises would not expose her to a risk of harm.
29 In particular, it is alleged that the injury suffered by the worker was caused as a result of the negligence of the first and/or second defendant.
30 The following particulars of negligence are alleged:
“(a)failing to provide safe premises having regard to the nature of the business being conducted on the premises and the services and facilities offered at the premises;
(b) failing to provide and maintain a proper security system;
(c)failing to fit-out the premises with any sufficient video or other security surveillance;
(d)failing to fit-out the premises with any or any adequate security systems and mechanisms which would deter and/or reduce the likelihood of robberies and/or similar criminal activity;
(e)failing to have any or any sufficient deterrent systems in place so as to prevent and/or reduce the likelihood of robberies and/or similar criminal activity;
(f)failing to use time locked safes, intruder alarm systems or other deterrents against the risk of or to reduce the likelihood of robberies and/or similar criminal activity;
(g)failing to fit-out the premises with any or any adequate system to protect the security of the premises having regard to the nature of the business being conducted on the premises and the services and facilities offered at the premises;
(h)exposing the worker to a risk of injury of which the First and/or Second Defendant knew or ought to have known having regard to the nature of the business being conducted on the premises and the services and facilities offered at the premises;
(i)exposing the worker to a risk of injury which could have been avoided with reasonable care on the part of the First and/or Second Defendant;
(i)failing to undertake any or any adequate risk assessment and inspection of the premises; and
(k)failing to identify the inadequacy and insufficiency of the security systems in the premises;
(l)failing to identify the inadequacy or insufficiency of the security systems in the premises increased the likelihood of risk of robberies and/or similar criminal activities;
(m)failing to identify that the security systems in the premises was insufficient and/or ineffective deterrence against robberies and/or similar criminal activities;
(n)failing to take adequate steps to eliminate, control and/or minimise the risk of the worker being injured.”[16]
[16]See exhibit 1, PCB pages 5 – 6
31 The plaintiff also alleges “further, or in the alternative” that each of the defendants were “occupiers” within the meaning of Part 2A of the Wrongs Act 1958, and that –
“… at all material times, pursuant to and in particular, section 14B of Part IIA of the Wrongs Act 1958 (Vic), owed a duty of care to the worker to take care as in all of the circumstances of the case was reasonable to see that the worker would not be injured or damaged by reason of the state of the premises or of things or omitted to be done in relation to the state of the premises.”[17]
[17]See exhibit A, PCB page 7
32 The plaintiff further alleges that the first and/or second defendants breached such duty, and refers to and repeats the earlier particulars of negligence in support of such allegation.
33 The plaintiff alleges that as a result of the negligence and/or the breach of statutory duty of each defendant, the plaintiff suffered her various injuries for which she was paid compensation and, accordingly, gives rise to the claim for indemnity by the plaintiff.
34 Both defendants filed Defences. In essence, the first defendant alleges that at the time of the robbery (or for that matter, any time) it was not an occupier of the new premises and, accordingly, owed no duty of care to the worker when she entered the new premises. In support of such allegation, the first defendant asserts that it did not own or lease the new premises and had very limited control of such premises.
35 Furthermore, later in argument, the first defendant asserted that even if there was a duty owed by it to the worker, there was no breach of such duty (given the application of Modbury Triangle Shopping Centre Pty Ltd v Anzil[18]) and furthermore, if there was a breach, such breach was not a cause of the injury suffered by the worker within the meaning of Part X of the Wrongs Act 1958.
[18](2000) 205 CLR 254
36 The first defendant also alleges that in the event that it was found to have been negligent or breached any statutory duty, then in determining the so-called Factor X in relation to the first defendant, it should be considered in the context that the liability of the unknown robbers and the second defendant would have to be taken into account.
37 Counsel for the second defendant, although acknowledging that the second defendant was an occupier of the new premises, succinctly summarised the position of his client by stating:
“…, what we will be submitting to Your Honour ultimately is there is no duty of care owed in these particular circumstances; if there is, there is there’s no breach; if there is a breach, there’s no causation, and we say that this case is a case governed by Part X of the Wrongs Act, which, if anything, lifts the bar in terms of the test as to causation, and if there is a finding against my client in terms of any liability, we would be submitting that the vast proportion of any such liability should be allocated to the robbers who conducted the armed robbery.”[19]
[19]T59, L12 – 22
38 Ultimately, it was agreed that Factor A, being the notional damages, for the purposes of the formula set out in s138(3)(b) of the Act, would be $870,000.[20]
[20] Agreement was reached with the second defendant on 28 July 2014 and with the first defendant agreeing to such sum on 30 July 2014. Prior to that, evidence had been given by a treating psychologist, Dr M Papasava, who was called on behalf of the plaintiff. His evidence was not particularly relevant after the agreement as to the amount of Factor A
39 Both the first and second defendants submitted that although there would be no particular challenge to the amount of compensation said to be paid to the worker, some of the compensation paid to the worker could not be taken into account for the purposes of the formula, since those payments of compensation would be statute barred. I was assured that there would be some agreement amongst the parties as to what was the compensation paid to date and the likely amounts to be paid for the future.
40 Bearing in mind that ss(1) of s138 creates the statutory liability in the third party to indemnify the plaintiff, and ss(3) quantifies such liability, I am of the view that the dispute between the plaintiff on the one hand, and the first and/or second defendants on the other hand, in essence, is whether the plaintiff can discharge its onus in establishing, as a matter of probability:
(a) That the “injury” suffered by the worker “was caused under circumstances creating a liability in … [the first defendant and/or the second defendant] to pay damages …” and, if so
(b) The extent of such liability.
The evidence
41 In part, because there were difficulties with the availability of witnesses and in part, because the matter was a cause, the parties called witnesses as and when they were available.
The evidence of Ronald John Murphy
42 The first defendant called Ronald John Murphy (“Murphy”), who gave evidence that he was the infrastructure security advisor for the first defendant and had been employed by the first defendant for forty years, all of which but two had been involved in a security role.
43 He described that a “good part” of his work has been doing security designs for Australia Post facilities across the country and writing security standards and security policies that apply to Australia Post premises and also to licensed post offices, such as the premises conducted by the second defendant at the new premises.
44 He gave evidence that he has a diploma in security risk management, is a Certified Protection Professional (“CPP”), has undertaken numerous courses with the Victoria Police and with the Federal Police on security, has a number of smaller qualifications and also has received training in crime prevention from the Victoria Police Crime Prevention Bureau. He has also been on loan from Australia Post to the Communication Authority of Thailand for the security and design of their new mail centre, stationed in Switzerland with the Universal Postal Union (which is a United Nations agency) for two years, providing security advice and service to 189-member countries.
45 Over the period between 1998 and 2000, he was assigned by the first defendant to do research and analysis on armed robberies at Australia Post facilities across Australia, including licensed post offices, because “they were at a very high rate at the time”.
46 In particular, Murphy gave evidence that he prepared a risk model called “The Four-Tier Model” for crime risk management.[21] He was also referred to exhibit 27,[22] which is a document headed “Crime Risk Management” authored by Murphy which gives more detail about the Four-Tier Model. Murphy described the Four-Tier Model to work as follows:
“The four tier model brings together three separate lines of study or three steps of pieces of information. The first is the crime rate in the area, and it was evident from experience that we were having that high crime rate areas had more post office robberies. The second is defensible space which was borrowed from Oscar Newman’s published work, and that simply describes the area around an outlet and says that certain streetscapes and features in those streetscapes filter out some of the crime, and the third tier is profile match and that quite simply says if you look at certain outlets that have been robbed, find others that look like those outlets, then we call that a profile match, and to bring the three together is the job of the four tier model and that says that crime is going to be high only where criminals are present, and active, and which they find suitable locations to operate in which they find suitable targets. The fourth tier is counter measures, so, high, high, high, for those first three tiers will give a high risk rating and only high risk ratings require the fullest of counter measures and that’s what makes it a risk based assessment. Any one of those tiers being pulled below will pull the overall risk rating down below.”[23]
[21]See exhibit 28, PCB pages 350 – 353
[22]See exhibit 27, PCB pages 348 – 349
[23]T74, L25 – T75, L16
47 Murphy also described the ratings consisted of “high”, “medium” and “low”, and depending on such assessment, would determine the extent of any countermeasures as compulsory measures. By that, Murphy explained that countermeasures are security measures and features that are thought to provide some protection against robbery.
48 Murphy was referred to exhibit 12,[24] which is entitled “Security Standards – Retail Outlets”, dated July 2000. Murphy explained that he wrote and prepared part of such a document and, in particular, Part A which deals with security countermeasures for the different levels of risk described in the four-tier model. When asked to explain how this document is used, Murphy stated:
“… this is the list of counter measures for a low-risk rated outlet from the first three tiers of the model. That bottom table, Table 3, would be the requirements for the outlet and they would be expected to have all those in place. If the outlet is rated medium, they would have all the low-risk items, plus the medium-risk items, and so for high risk it would have the low, the medium and the high and that would be the total list that would be required.”[25]
[24]See exhibit 20, PCB pages 199 – 235
[25]T79, L1 – 9
49 Part B of that document sets out the “security standards” which include alarm systems, building, cash handling, counters, layout, location, safe, signage, staff and surveillance, to name some of them. Furthermore, Item 26 of Part B, refers to “Security Surveys and Risk Assessments”. In that item, it is explained that each retail outlet will have a risk assessment review every two years.
50 Murphy gave evidence that as at 2002 or 2003, there were approximately 4,000 Australia Post outlets, of which approximately three-quarters were licensed post offices (such as the business conducted by the second defendant at the new premises), with the balance being corporate outlets which consist of the traditional post office. He also described that at that period of time, security surveys were undertaken every two years at each of those outlets. Murphy noted that when a licence is granted to a licensed post office, the licensee is provided with documentation, including security standards and crime prevention literature, including a “Guide to Post Office Security”.
51 Murphy was referred to a Security Survey dated 10 October 2002.[26] Such Survey records that the survey was undertaken on 10 October 2002 and the licensed post office surveyed is said to be that at 10 Macedon Road, Lower Templestowe, Victoria. Indeed, the last reference to 10 Macedon Road gave rise to much of the confusion in relation to the appropriate premises, as the Survey would suggest that the second defendant had already commenced occupation of 10 Macedon Road as at 10 October 2002. Murphy explained that the actual document is an online computer form which is completed following the survey. In relation to the reference to “10 Macedon Road”, Murphy stated:
“Yes, I can explain that, Your Honour, it is the nature of our database that it draws the address information from a central database of addresses of all premises. That address database gets updated and whatever an old unit this says, it will see the new address on the form at the time we print it out. As a result, this is not showing the correct address when the survey was undertaken but---.”[27]
[26]See exhibit 20 at PCB pages 301 – 305
[27]T83, L17 – 25
52 Counsel for the second defendant acknowledged that although given that such survey must relate to the previous premises rather than new premises, it may be potentially relevant in terms of crime rates at that time but can have no relevance as to the layout of the premises or what was contained in the premises as it is dealing with the previous premises rather than the new premises. In particular, counsel for the first defendant stated, in relation to such survey:
“It has very limited relevance, Your Honour, it’s just a question - Your Honour laughs, but it’s very important that Your Honour gets the chronology of what has happened and for that reason I have to take the witness to the document and explain why that different address is there, because otherwise it might be said that the court is being misled by a suggestion that the 2002 survey relates to these premises, and it doesn’t.”[28]
[28]T94, L13 – 20
53 Murphy was then referred to a document headed “Retail Security Countermeasures Report” in respect to the survey undertaken on 10 October 2002.[29] He was queried about various comments in such report:
[29]See exhibit 22 at PCB pages 306 and 311
(a) The word “low” near the word “robbery” at the top of the report means under the four-tier model the grading was made that the previous premises had an initial risk rating of low for armed robbery and robbery. Such a grading is brought about by a computer calculation on the basis of the information obtained from the previous survey;
(b) Next to the heading “counter design” are the words “upgrade/replace to Standard 13.1” which means the Standard had to be complied with without any actual deficient aspect at the counter;
(c) Next to the heading “doors through counters 400mm high with effective locking” are the words “install/modify doors or door/s to meet Standard 13.2” which requires for appropriate locks to be put on the doors;
(d) Next to the heading “Safe Appropriate to Holdings and Cash Management Plan Minutes” are the words “protect/replace/install safe to suit holdings, as per Standard 24.1 and with CSG advice”.
(e) Next to the heading “time lock cash recycle – container device for cash storage” are the words “install a time lock device to meet Standard 11.4”.
In reference to that requirement, Murphy gave the following evidence:
Q:“Could you just explain to the court the references to a time lock cash recycler/container device for cash storage; firstly what is a time lock cash recycler or container device?‑‑-
A:There are two types of - main types of time lock cash container that we use within Australia Post. It’s a metal box mounted generally near the counter with a deposit slot to get rid of cash out of the drawers that’s excess. It has a time lock on it and it's intended to interfere with the planning of a robbery, so that if someone comes in, demands the cash, the staff can legitimately say ‘I can’t give you any more than is in the drawer’. A recycler is a patented device listing myself as the inventor, but it’s the equivalent of a time lock cash container, except it’s able to recycle cash in small amounts back to the counter officer.
Q:In respect of low risk offices was there a requirement to have both of those types of containers installed?‑‑-
A:Certainly not, a recycler is only required at high risk outlets and the time lock cash container is required at low, medium and high.
Q:If a premises has a safe with a two key compartment which would mean a situation where there's one key held by the licensee and another by Armaguard or an external body like that, does that type of two key safe provide secure storage of excess cash in a similar manner as the time lock cash container, or does it serve a different function?‑‑-
A:It does serve a similar function to the time lock cash container in that Australia Post would approve storage of daytime cash in either device. In many ways the two key compartment is more robust, it’s certainly stronger, it’s a safe, and, yes, you can get rid of your excess cash into it through a deposit slot and it then can't be available to a robber unless he waits for armed security guards to turn up in an armoured car. The convenience of the time lock cash container is it’s out at the counter and so it’s thought to encourage more frequent use by being closer to the counter as a temporary place to store cash before it goes into the two key compartment, but they do function against robbery in the same manner.
Q:When you say the time lock cash container is at the counter is it something that's visible to customers or indeed potential robbers coming into the post office?‑‑-
A:It’s normally under the counter and generally not visible to either a robber or a customer.”[30]
[30]T100, L8 – T101, L20
I refer to paragraph 11.4 in the document headed “Security Standards – Retail Outlets”[31] which states:
[31]See Exhibit 12 at PCB page 218
“A time lock device for cash storage shall be a metal security container or safe fitted with a lock, which incorporates and electronic or other time delay feature to prevent immediate opening. It shall have a deposit slot or chute. Such equipment includes a time lack cash container, time lock cash recycler, a time lock safe or compartment within a safe with a deposit chute. A counter cache unit is not a time lock device unless it has been fitted with a time delay lock.
‘At each counter position’, means within hand reach of every counter position, without walking or bending
11.4.1Time Lock Cash Container
Time Lock Cash Containers (TLCC) are designed for the protection and temporary storage of excess cash. They must be used in conjunction with the approved signage and must be emptied and the doors left open overnight. TLCC’s shall be closed and locked at all times while holding cash.
11.4.2Cash Dispensing Device
A Cash Dispensing Device shall be a cash container, with a time lock, that only allows a limited portion of its cash to be within drawn at a time (eg. no more than $1,000 per minute). One such device is the Time Lock Cash Recycler, described below. Cash must not be left in a Cash Dispensing Device overnight. Refer Section 11.4 re ‘Cash Counter Position’.
11.4.3Time Lock Cash Recycler
A Time Lock Cash Recycler is a single device, which is both a Time Lock Device and a Cash Dispensing Device. At any time, excess cash can be cleared from an advance and deposited in the device in special cassettes. If cash is needed, the device can dispense cassettes but faster than one cassette per minute. When the device must be cleared of all cassettes, a separate time delay (five minutes) can be activated.”
54 Murphy was then referred to the Security Survey Form in relation to the new premises undertaken on 20 July 2004[32] (some seven months after the robbery). In a similar way (although not identical) such survey poses similar questions to the survey undertaken on 10 October, 2002. An officer of the first defendant fills in such form under the various headings. The headings include location, type of office, external walls, external doors, side and rear windows, roof, safes, counters, cash management, alarm system, surveillance, security awareness, other security measures used, defensible space, design layout and site detail.
[32]See exhibit 22 at PCB pages 308 – 311
55 Murphy was queried in relation to a variety of matters in that document:
(a) He was referred to Item 10 which deals with “safes” and therein is recorded that there were two safes, being a Chubb and a Lord or Armaguard safe. In relation to those safes, Murphy stated:
“I can tell that that’s a torch and drill resisting Chubb safe, approximately 900 millimetres high. It was built under contract for Australia Post. Its overnight holdings average $15,000 and that $15,000 is only protected by the door, not through any compartment inside. The safe is secure against removal by either bolting down or some other means, that it is covered by an alarm system directly over the safe. It’s located in the rear office and it’s rated as appropriate to holdings meaning that it has not exceeded the overnight cash carrying amount that we have set for that safe.”[33]
[33]T103, L9 – 19
When queried about the second Lord or Armaguard safe, Murphy stated:
“The Lord Armaguard safe, and ‘Arm’ is an abbreviation for Armaguard, it’s also about 900 millimetres high. The serial number clearly indicates that it’s a two key cash collection safe, and it’s used for overnight cash and the lock section says TC which the legend says it has a two key compartment and a combination lock on the outside, so that is the two key compartment with a deposit slot for protection of daytime cash. It is bolted down and it is alarmed and it is rated TDR. ‘Appropriate to holdings’, yes, I agree that that’s correct.”[34]
[34]T103, L21 – 31
(b) Murphy was referred to Item 12 involving “cash management” wherein the form indicates that there was no Time Lock Cash Container at any counter position although, there was a Time Lock Cash Recycler at every counter position. When queried about this aspect, Murphy stated:
A:“Yes, but a time-lock cash recycler is a type of time-lock cash container.
Q:It just has an additional feature?‑‑-
A:Yes.
Q:It spits out money; is that what you're talking about?‑‑-
A:That’s correct.
Q:Does the absence of a time-lock cash container then cause any concern?‑‑-
A:No, it doesn’t. The form lists a great many different types of cash handling equipment. It's only a concern if you have no protection to the cash.”[35]
[35]T104, L18 – 26
(c) Murphy was referred to Item 13 – “alarm system” and gave evidence that there was “absolutely no problem with the alarms at this outlet” – in part because there were bandit buttons at every counter position with alarms covering the safes and such system was monitored by Securitel, which is “a very high grade of alarm monitoring” which is normally not required unless it were a high risk outlet;
(d) Murphy was referred to Item 14 “surveillance” and Murphy explained what this item relates to in the following terms:
“Some sources give advice that a counter should be visible from outside so that people outside the realm of the robbery and outside the control of the robbers, if they see it happening, they might report it. So we measure the visibility from outside the outlet in to the front of the counter.”[36]
[36]T106, L25 – 30
Murphy considered that the surveillance aspect met the relevant standards.
(e) Murphy was also referred to that part of the document dealing with “surveillance system” which would suggest that there was no surveillance system in force as at the time of the survey in July 2004. Murphy gave evidence that it was “definitely” not a requirement at low risk outlets, and when queried why, he stated:
“Video surveillance, at that time, was far less effective than it is now. The resolution of the cameras was very low and the resolution of the recording was actually half the resolution of the cameras, so what you were having stored was very grainy and very fuzzy pictures and whenever they were shown on television, very rarely would anyone say that, ‘Yes, I recognise those people’. They were just a fuzzy blur going past.”[37]
[37]T107, L13 – 20
(f)Murphy was referred to Item 15, “Signs”, wherein there was a cross in relation to the premises having currently approved Australia Post security signs. Murphy confirmed that the then current approved signs used to indicate what security system is there were not present. When queried about the purpose of having such signage, Murphy stated:
“Because the time-lock cash container is under the counter, the two-key safe is in the back office, and the alarm system isn’t always that evident, the idea is to try and convey that message to a potential armed robber. It is standard industry practice for better or worse.”[38]
[38]T110, L2 – 7
When queried further, Murphy stated that the quantitative evidence would suggest the signage has not made a difference. He stated that every robbery which had occurred in the twelve months previous to giving his evidence had appropriate signage, whereas sixty eight outlets around the country which did not have the correct signage were not robbed;
(f)When queried in relation to Item 19, which sets out various requirements, one of which was to add a lock to the back office door behind the counter, Murphy stated:
“It’s a security requirement under the standards for a medium risk outlet. At the time I’ll say of doing the security survey, Joanne Schmidt had no idea what security risk rating this outlet would have come to. … .”[39]
[39]T111, L5 – 10
(g)Murphy was referred to Item 20 “Defensible Space” and queried whether any of the matters dealt with in that item gave rise to security concerns. He stated:
“The territoriality is a positive feature, the natural surveillance is a positive feature. The escape routes: ‘Are there multiple high speed escape routes nearby?’ That box is ticked as ‘Yes’ and that’s a negative feature in that it contributes to robbery if the offenders can escape, given that armed robbery is one of the few crimes that needs a high speed escape route. Vehicle access: A vehicle can park within five metres – it’s an unfortunate feature of almost every shop that you can park out front, and if the council puts up a ‘No standing’ sign it’s reserved parking for armed robbers. The locals seem protective and caring of the street and is well maintained, and that’s a positive feature. It says there’s no broken windows or graffiti, which is good. ‘Are there several vacant shops?’ No, there are not. Vacant shops and graffiti seem to attract crime. ‘People loitering making the area seem unsafe?’ ‘No, they’re not.’ ‘Is drug use evidence in this block?’ ‘No, there is not’.”[40]
(h)Murphy was referred to Item 21 “Design/Layout T3” and confirmed that the reference to Tier 3 is a reference to the third tier of his four-tier model. Again, Murphy was queried about the “positives” and or “negatives” of each of the matters referred to in this item. He stated:
“It’s very difficult to say what’s positive and negative with some of them because all together they form a single profile and we compare that with the targets of recent crimes, but some of them are known as negatives. A shop on a street within a shopping complex and purpose built as a post office within a shopping complex almost never gets robbed.”[41]
[40]T113, L8 – 26
[41]T114, L9 – 15
56 In particular, Murphy gave evidence that a cash recycler device (as designed by him) does not secure cash contained in a till. He also confirmed that based on the review of the records held by Australia Post, there had been no robberies at the new premises prior to 16 December 2003 and no robberies at the previous premises situated at 18 Macedon Road, Templestowe Heights.
57 The Retail Security Countermeasures Report in relation to the survey of the new premises undertaken on 20 July 2004 was tendered.[42] In that report, the risk of robbery based on the four-tier model was considered to be “low”. Furthermore, consistent with the survey, action required was:
[42]See exhibit 23 at PCB pages 312 – 313
(a)to remove any excess signage and provide security signage consistent with Standard 27.2 of the document “Security Standards – Retail Outlets”;
(b)to ensure there be in place an appropriate cash management plan as per Standard 11.1 of the same document – that is to say, that
Time Lock Cash Containers be used;
(c)cash collection – delivery service if required under accounting instructions – full reference provided in Standard 11.2 of that document;
58 Under the heading “Additional Security Requirements”, the Countermeasures Report indicated that there should be added “a lock to the rear office door behind the counter and appropriate security signage required for new premises”. Such signage should be an Armaguard sign.
59 Murphy was referred to the document “Guide to Post Office Security”.[43] Such document indicates that it was issued in September 2003. Murphy gave evidence that he would have been the author of various sections of such document and such document was prepared for Australia Post office managers and for the use of licensed post offices. Murphy also confirmed that there were earlier versions of such document but he was unable to locate a copy.
[43]See exhibit 30 at PCB pages 377 – 430
60 In particular, the following evidence was given by Murphy in relation to the first defendant’s “control” over cash management at any particular premises:
Q:“As at December 2003, when the robbery occurred, did Australia Post have any day to day control over cash management at this particular premises?‑‑-
A:Not day to day direct control of any kind. There was the general procedures that the outlet was meant to follow in handling its cash, but, no, there was no supervision of the outlets.”
HIS HONOUR:
Q:“Did Australia Post have the right, and did they exercise it, if they had a concern about a premise, to come into a premise and check it?‑‑-
A:They did have the ability to conduct an audit on the finances of the place should something arise that was untoward.
Q:They could walk in at effectively any time to do that?‑‑-
A:I’m not sure if notice was required, but I believe that is correct.”
MS MANOVA:
Q:“If the premises are locked up, for example, it's out of normal operating retail hours, could Australia Post go in there, somehow obtain a key and go in and rifle through the premises?‑‑-
A:I don't see how that’s possible and certainly I don’t believe we would have any right to do so.”[44]
[44]T120, L17 – T121, L5
61 Under cross-examination by counsel for the second defendant, Murphy stated:
(a) That in 1999, there were approximately 200 robberies of both corporate post offices and licensed post offices. In 2013, that had reduced to 55 robberies and for the financial year ending 30 June 2014, there had been 39 robberies. The amount of money taken in robberies over the period has been “fairly static”, being in the order of about $2,000;
(b) He confirmed that all the robberies that took place in the last months prior to the trial had appropriate signage in place. The 68 premises without appropriate signage were not robbed, although Murphy considered that one of the reasons for that was that such outlets were more “remote” than city outlets;
(c) He accepted that most of the robberies that have taken place in recent years have had Time Lock Containers in place. He noted that cash recyclers are becoming rarer now because the manufacturer has lost interest in manufacturing them due to the low number of sales;
(d) He accepted that there was a two-key safe at the new premises at the time of the robbery and no funds were stolen from that safe. Furthermore, he accepted that the bulk of funds were taken from the three tills and obviously enough, it was necessary for the tills to have a certain amount of cash in order for the business to operate;
(e) He confirmed that as at July 2004, following the security survey, the new premises continued to be assessed as “low risk” notwithstanding the robbery in December 2003. Murphy explained this situation to be that the experience of one robbery was only one fact which forms part of the process of assessing the appropriate tier;
(f) Murphy stated that back in 2003, there would have been approximately 45 people employed by the first defendant carrying out security surveys. Such people would have undertaken internal training over a number of days and probably a range of training courses on general security. Furthermore, he accepted that at and around that time (and later), Australia Post informed licensed post offices that there would be a security review by Australia Post at least every two years (in consultation with the licensee). He accepted that Australia Post had the relevant expertise as to appropriate security measures. Murphy stated that although he was aware of notices being sent to the new premises requiring to upgrade security as part of the security countermeasures following security surveys, he was unaware of details of any transmission or posting or covering letter to the second defendant, as he was not involved in that particular process. In particular, I refer to the following evidence:
MR McDONALD:
Q:“In general terms, what happens is this, isn’t it, that the money accumulates in the till during the course of business during the day, and from time to time the money is physically removed from the till, taken to the back room, counted, put into bundles or bags, and then deposited through a slot into the two key safes?‑‑-
A:Yes, there’s two ways that can happen. It can either be siphoned off during the day into a time lock cash container and then taken out of that at the end of the day, or throughout the day it can be taken out in bundles, always with the aim of reducing the amount of cash in the cash drawer and then bundled up with a note into the two key compartment of the safe.
Q:Both, either of those means, is acceptable, or common practice?‑‑-
A:It is a standard to have a time lock cash container, so, I would say not having one for us is not acceptable, but both methods do secure the cash. One requires more diligence.”[45]
[45]T135, L16 – T136, L2
62 Counsel for the second defendant referred to the July 2004 Security Survey[46] and suggested to Murphy that in general terms, it is a satisfactory assessment of the premises and there was not a lot to be concerned about. In response, Murphy stated:
“It did show that there were deficiencies in the countermeasures report. I’d certainly be concerned about those and I’d be doing everything I could to encourage compliance. I certainly take time-lock cash containers seriously because of the ability to more conveniently reduce cash, and I would take the signs seriously. I really want all our places to be compliant.”[47]
[46]See exhibit 22 at PCB pages 308 – 311
[47]T145, L16 - 22
63 Counsel for the second defendant referred Murphy to the Witness Statement made by Albanis.[48]
[48]See exhibit A
64 After reading such document, Murphy commented that the circumstances of the robbery was one of the scenarios that occurs, although it was not currently the major trend, in that guns are only involved in a small percentage of robberies of more recent times. He accepted that one of the obvious features of the robbery was with the speed with which it was undertaken, and he did not consider there was any significance that the robbery occurred just before closing time.
65 Murphy accepted that the fit-out of the new premises at 10 Macedon Road, Lower Templestowe was required to be approved by the first defendant, although he stated he was unaware and would be surprised if the first defendant suggested what the fit-out would be.
66 Murphy did accept that it would be “common” to have wooden drawers under the counter rather than cash registers and that if the weekly takings of the new premises were between $60,000 and $70,000 per week, they would be a little above the median level.
67 In particular, the following evidence was given:
Q:“In terms of the procedure for using the two key safe which is referred to in the survey, my instructions are that the procedure that we used was as follows; firstly that you remove cash from the registers as the totals - as it adds up - at first instance, and the cashier takes the money from the cash register to the back office to a bench in the back office where the money is counted. Do you agree that’s the first part of the process?‑‑-
A:I don’t agree that that’s the proper process. A time lock cash container is mandated under our standards and ideally is siphoned via the drawer into the time lock cash container for convenience, then taken from there out the back, but I do understand that this is doing the same effect.”[49]
[49]T158, L7 – 19
68 Counsel for the second defendant then went on to query Murphy about the balance of the process, and the following evidence was given:
Q:“When it’s removed to the back office, the cash is then counted, and then whoever counts the cash then has to go back to the cash register in the main part of the premises to key in a safe deposit amount which is registered electronically with Australia Post?‑‑-
A:Yes, that sounds correct.
Q:The operator then has to complete a safe deposit slip?‑‑-
A:I think the cash should be in the safe before they return to the counter to enter the amount. You wouldn’t leave the cash sitting out on a bench and then go and do a transaction at the front of the counter.
Q:That may well be right, because according to my instructions, an amount of 8000 had been deposited in the two lock safe a few minutes before the robbery took place?‑‑-
A:That would be quite possible, yes.
Q:But part of the process does involve the operator filling out a safe deposit slip, one copy’s retained at the post office and one copy's placed in a safe deposit bag?‑‑-
A:Yes.”[50]
[50]T159, L14 – 31
69 Under cross-examination by counsel for the plaintiff, Murphy indicated that the sum of $90,000 held at the premises on a nightly basis represented what was considered to be the “peak” rather than an average notwithstanding that the word “average” is used in the Security Survey. He explained that he had trained people to put the peak amount to give the worst scenario in the event there was a robbery.
70 Murphy accepted that it may well have been that there had been a cash collection a few hours prior to the robbery but doubted that the sum stolen (approximately $21,000) would have come in to the business during the few hours between the earlier cash pick up and the robbery. Murphy also accepted that in general terms prior to the cash pick-up earlier that day, there may have been in the order of $80,000 given that the cash pick-up was in the order of $60,000 and there was approximately $20,000 stolen.
71 Counsel for the plaintiff referred Murphy to the email dated 17 December 2003 from Davis to Richard Walsh,[51] wherein it was stated that the new premises were “not fitted with security cameras and have not yet been fitted with time lock cash containers”. Murphy accepted that it was not part of the Standards at that time for the new premises to have security cameras but it was a breach of the standards in relation to the lack of Time Lock Cash Containers.
[51]See exhibit 15 at PCB page 290
72 Murphy accepted that in recent times, 93 per cent of robberies occurred at licensed post offices, with only 7 per cent at corporate post offices. He commented that that was not the same situation back when the robbery occurred but it was still overwhelmingly the majority of licensed post offices, but again, he noted that licensed post offices outnumber corporate post offices.
73 Counsel for the plaintiff cross-examined Murphy, suggesting to him that there had been ongoing improvement reflected in the decline of robberies over the years, to which Murphy agreed.
74 Murphy also accepted that after the introduction of Time Lock Cash Containers in the mid-1980s, there was a substantial reduction in robberies at Australia Post retail outlets in the Sydney suburbs. Murphy also stated that although there was an initial concern that a staff member could not oblige any potential robber given the Time Lock Cash Containers, he noted that there was no rise in violence during robberies after the introduction of such containers.
75 Murphy stressed that the great advantage of Time Lock Containers is that the robber has to be prepared to wait a period of time before the container can be opened, and he could only recall on one occasion where a robber did wait until the container had been opened. In such circumstances, Murphy accepted that the introduction of Time Lock Containers has at least been a factor in the diminution of robberies over time since their introduction and in particular, stated:
“Yes, I believe it has, especially in the early days when that was the only security measure that was being rolled out at the time. I believe the impact of that, I don’t believe we’ll ever get another 50 per cent drop in robberies in one hit again, but early on when that was the main way of putting cash out of the reach of the robber it made a significant difference.”[52]
[52]T179, L25 – T180, L1
76 Under cross-examination, Murphy accepted that where a premises did have time delay cash devices, it was logical to advertise the security feature. Murphy was queried about how the security surveys are “enforced”, and he stated:
“The security survey isn’t a set of recommendations. It’s the survey that notes the conditions at the site, assesses the risk and then generates the list of requirements. Now, the Security Group is not in the position on site to enforce that or doing anything to the manager other than give some legal advice, but certainly that comes back through the Area Manager and they should be putting to the licensee if you are non-compliant.”[53]
[53]T191, L4 – 12
77 Counsel for the plaintiff put a variety of propositions which is encompassed by the following evidence:
Q:“What I am putting to you is that what you have told the Court is, and we understand that, that even when all these signs and so on are in place and the time devices that you’re still having robberies; greatly reduced I appreciate but?‑‑-
A:That is true.
Q:But the number of robberies, and I've just been through this with you, has decreased markedly since 2003 for instance?---
A:Yes.
Q:I am just repeating that question, but that’s because of – it can be put down to the increased security measures that have been put in place?---
A:I certainly believe that that has been a contributor, yes.
Q:And that includes the time lock devices and the security signs, amongst other things?---
A:It does include those, yes.
Q:And that in turn means that those matters have contributed to a reduction in the number of armed robberies?---
A:I can’t point to individual items and say they have contributed or what degree they have contributed. I can say that the package of security as a total has contributed as a whole to the reduction.
Q:And part of that package are security signs and the time lock devices?---
A:That is true.”[54]
[54]T197, L11 – T198, L1
78 Murphy accepted that a claim made in some of the documentation supplied by the first defendant that a time delay feature up to five minutes is a “proven deterrent to robbery”.
79 Under re-examination by counsel for the first defendant, Murphy stated:
(a)That prior to 2001, the first defendant did not have in place a system of two-yearly security assessments;
(b)When he spoke of the “whole package” being responsible for the decrease in robberies over the years from about 2001, Murphy stated in response to being queried what is the whole package:
“I was referring to actually getting a working model that was able to predict the rate of robbery at retail outlets and LPOs and that moving resources to where the risk was higher and increasing the security there, the use of our investigators to conduct security surveys during which they would give advice, assess the area, assess the risk rating and subsequently reduce the countermeasures. On top of that was the increased use of security countermeasures, including the Armaguard cash collections, the set of countermeasures that are listed in the standards, and a rising security awareness among our own people, and we were presenting security advice at various forums that the licensees would attend, and on top of that I would write security articles for the LOP journals and various types, so there was a number of different approaches. We also gave interest free loans to the outlets to put in security materials, CCTV equipment in particular, but there was a whole range of activities. Lots of people are claiming to have been part of this downward trend and I'm certainly pointed out as having a part of it, but I'm part of the ‑ ‑ ‑”[55]
(c)Of the 39 robberies in the last year (covering 4,000 outlets) more robberies involved “compliant” outlets, which Murphy explained to mean had Time Lock Cash Containers and appropriate signage.
(d)Murphy stated that the Area Managers employed by the first defendant do not control security but rather, the security countermeasures report is taken to the licensed post office with compliance encouraged rather than necessarily enforced pursuant to the terms of the contract. Furthermore, Murphy confirmed that he did not believe that the managers of the first defendant would be directly involved in fitting out a premises, although they would have ideas as to the size and shape of the counter areas and the displays that may be required. Any refurbishment or a fit-out would be paid by the licensed post office.
[55]T206, L8 – 28
The evidence of Antony Michael Zalewski
80 Antony Michael Zalewski (“Zalewski”) gave evidence on behalf of the plaintiff. He described himself as a security risk consultant. He gave evidence that he had been a member of the Victoria Police until 1990 and in particular, was a member of the Armed Robbery Squad for about four years from 1980 to the end of 1983.
81 Since leaving the police, he has completed a PhD through Monash University on Systems of Security and Safety; completed an undergraduate Criminal Justice Degree; a Bachelor of Laws, and a Master of Arts in Criminology from the University of Melbourne. He also has vocational education and training qualifications and has been involved in teaching security risk management. In general, he described his work as follows:
“… I mean anything that really touches on a system of security or safety, so it might be series of risks that might apply to an industry, to an industry sector, to an organisation or to individuals within the organisation.”[56]
[56]T223, L17 – 21
82 Zalewski gave evidence that he prepared a report dated 21 July 2011 on instructions from the then solicitors for the worker, Messrs Vincent Verduci & Associates.[57] He gave evidence that, at the time of making that report, he had available the following information:
(a)Letter of introduction from Messrs Vincent Verduci & Associates dated 19 May 2011;
(b)Affidavit of the worker sworn 14 December, 2009. He also interviewed the worker on 14 July 2011 at the offices of her solicitor.
(c)Initially, he claimed to have photographs from the police investigation into the robbery, which included detailed photographs of the inside of the new premises.[58] Later, he accepted that he did not have the police photographs at the time of making that report.[59]
[57]See exhibit 2 at PCB pages 20 – 37
[58]T225, L22 – 26
[59]T312, L14 – T313, L21
83 Zalewski also gave evidence that he attended the new premises on 19 July 2011 and personally took a number of photographs, and only one of those photographs related to the inside of the new premises. Zalewski accepted that he took such photographs discreetly, without knowledge of the then occupier.
84 In the report, Zalewski highlights that strategies can be introduced to minimise common risks by implementing an appropriate system. Such systems should include, amongst other things, “strategies based upon a risk assessment that typically results in the introduction of physical, personal and procedural measures”.
85 In that report, he defines those terms to mean:
“‘Physical’ security measures include use of lighting, alarms, CCTV, convex mirrors, locks and other site-specific equipment contingent upon situational issues such as anti-jump barriers. ‘Personnel’ measures involve the introduction of ‘competent’ staff who are able to assist with meeting the business objectives of the organisation, including security and safety expectations. ‘Procedural’ measures involve the introduction of documented protocols (including procedures), that guide key stakeholders in their work.”[60]
[60]See exhibit 2 at PCB page 24
86 In particular, he noted that the design of a workplace is important, as it forms the basis for “target hardening”, or making it less attractive to a potential offender.
87 In the report, he asserted that researching the criminal behaviours “suggests that the decision to offend or not is more influenced by cues to the perceived risk of being caught than by cues to reward or ease of entry”.[61] He further stated that the three most common built environment strategies are natural surveillance, natural access control and natural territorial reinforcement. In particular, he stated in such report:
[61]See exhibit 2 at PCB page 25
“Natural surveillance and access control strategies limit the opportunity for crime. Territorial reinforcement promotes social control through a variety of measures. Natural surveillance in the circumstances of the post office involves designing windows, lighting and store layout to improve the ability of staff, customers and passers-by to observe activity outside and around the business. Through intelligent design a business can be a less attractive target, whilst also increasing the likelihood of detecting a criminal at work, the objective of natural surveillance is to maximise the number of eyes watching over a business by creating a visual connection between:
·the street;
·the footpath; and
·the business
The key component in this case is the layout of the store as this can substantially impact upon the potential for crime. For example, a service counter at the rear of the store means there is less opportunity for natural surveillance. If there is stock or otherwise blocking the internal areas of the store the deficiency increases.”[62]
[62]See exhibit 2 at PCB page 25
88 Zalewski noted in the report that he had not been provided with any information about whether there was an assessment of the new premises prior to the robbery in 2003. He states:
“I am advised there was no CCTV nor obvious security related approach such as convex mirrors; signage, height markers or attempts to move the service counter to a more formal frontal location in the store or limit the height of displays to create natural surveillance.”[63]
[63]See exhibit 2 at PCB page 26
Ultimately, Zalewski concluded that the:
“Design of the post office some eight years after this incident is inappropriate for the reasons outlined above. In my opinion, had care been taken to address the risk associated with robbery the design and layout of this workplace to create a harder target and hence dissuade potential bandits, the plaintiff in all probability would not have suffered damage.”[64]
[64]See exhibit 2 at PCB page 36-37
89 Under cross-examination by counsel for the first defendant, it was suggested to him that he “didn’t have any idea what the premises looked like in December 2003 at the time of the robbery”, to which Zalewski stated he had an idea, because he had been there (on 19 July 2011) and what he had been told by the worker during his interview with her. In respect to the latter point, he could not recall what, if anything, she had told him about the internal part of the post office and, indeed, he accepted that nothing was detailed in his report.
90 He also accepted, at the time of making such report, that he had not made any enquiry as to whether the licensee had changed since the robbery (some eight years ago).
91 In particular, the following evidence was given in relation to the first report:
Q:“Can you explain to the Court how you came to the view that the plaintiff, in all probability, would not have suffered damage had care been taken with the design and layout of the workplace? Just explain what you really mean there?---
A:Well from what I was told by the plaintiff in that interview, she described the layout of the post office before I went there and took photos, and when I go there subsequently and saw the layout and design of the place, it was pretty apparent from what I had been told by the plaintiff and then what I then saw and took photographs of that, really nothing much had obviously changed from the public area of the post office, including the entry, so in other words, when I got there the layout, you know, the openness that you would expect to see in a post office, in a licensed post office wasn’t evident eight years later which surprised me.
Q:The openness. So I don’t want to simplify it too much, but are you really seriously suggesting that if the layout was more open and the design was better that it probably wouldn’t have taken place in all probability?---
A:You can’t guarantee that a robbery would not take place, but more likely than not a robbery could’ve been avoided had these zones of control that I’ve referred to a number of times been in place. One zone of control is the openness of the retail area so there is that connection of eyes between those persons outside in the street, those on the footpath, those in the post office, and those who are passing by. If you have openness, then you have that connection. That is one part …
Q:Yes, do you …?---
A:Mam, I haven’t finished.
Q:Sorry?---
A:That was one part of target Hardening and as I said before, one part of target Hardening by itself and I’ve said it in one or both reports is not the solution. It’s a combination of factors. In other words zones are controlled that are thought through and introducible minimise risk.”[65]
[65]T317, L18 – T318, L22
92
Zalewski also gave evidence that he prepared a further report dated
28 September 2011 at the request of the solicitors (Messrs Russell Kennedy) for the present plaintiff.[66]
[66]See Exhibit 2 at PCB pages 37.2 to 37.17
93 For the purposes of this report, Zalewski had available to him seemingly all the exhibit material available to the parties in this case.
94
In that report, Zalewski spends much time analysing and discussing the security survey form in relation to the previous premises undertaken on
10 October 2002. For reasons which I have recorded earlier in this Judgment, such security survey form is of limited relevance given that it pertains to the previous premises not the new premises where the second defendant moved in or about September 2003.
95 It would seem clear from the documents listed by Zalewski in his second report that he had available to him the security survey form dated 20 July 2004 and the countermeasures report of the same date.
96 However, it is also clear enough that Zalewksi now had the photographs taken by the Victorian Police at the time of the robbery and such photographs obviously relate to the new premises rather than the previous premises.[67]
[67]See paragraph 60 and photographs following in exhibit 2 at PCB pages 37.13 ff
97 Seemingly, Zalewski does not refer to the security survey form in relation to the new premises undertaken on 20 July 2004 (approximately seven months after the robbery) or, indeed, the retail security countermeasures report, also dated 20 July 2004.
98 Ultimately, Zalewski concluded:
“In my opinion had care been taken to identify, analyse and address the risks associated with robbery, in the design and layout of this workplace to create a harder target and hence dissuade potential bandits, the plaintiff in all probability would not have suffered damage.
‘[t]he foundation of occupier's liability is occupational control, ie, control associated with and arising from presence in and use of or activity in the premises.’”
(c)Redlich JA, in the Court of Appeal decision of Central Goldfields Shire v Haley & Ors,[121] stated:
“Even if the council were discharging functions affecting the highway in a number of capacities, it does not necessarily follow that the council must be an occupier. No sufficient attention was given at trial or on appeal to the nature and extent of the control that must be exercised over the relevant premises to establish occupation.[122] In Jones v Bartlett, the right to enter premises for the purpose of carrying out or inspecting necessary repairs to or maintenance of the premises did not demonstrate that the respondents had control of the premises. A particular application of the control test is seen in cases where a person has a right to immediate supervision and control and the power of permitting or prohibiting the entry of other persons. It will be a question of fact in each case whether there is a sufficient degree of control to make the person an occupier.”
[121](2009) 24 VR 378 at 398 paragraph [73]
[122]Redlich JA refers to Jones v Bartlett at 209, 210, paragraph [150]
131 The first defendant did not own the new premises or hold any lease over such premises. The Lease Agreement dated 1 September 2003[123] identified the lessor (“landlord”) of the premises to be “Leontia Ioannadiou and Theohris Joannides” and the tenant to be the second defendant.
[123]See Annexure “C” to exhibit B, being the witness statement of Albanis dated 11 August 2014
132 Furthermore, the first defendant did not own any of the fixtures or security equipment at the premises, save for the Armaguard two-key safe. The second defendant owned plant and equipment at the outlet including the safe and security alarm system.[124] The first defendant did not fit out the new premises, and although the first defendant recommended the engagement of a particular shopfitter, the second defendant liaised with the shopfitter and paid for the fit out.[125] No employees of the first defendant worked at the new premises.
[124]See Schedule “A” to the Contract of Sale of Business and Annexure “A” to exhibit B, being the statement of Albanis dated 11 August 2014
[125]T354, L27 – 31
133 Although the second defendant was obliged to name the first defendant as an additional insured on the public liability insurance policy,[126] an insurance policy between the first defendant and a private insurer is not a proper basis for a finding that the first defendant had occupation or control.[127]
[126]See Exhibit 11, Licensed Post Office Agreement, clause 18, PCB page 169
[127]See generally Victorian WorkCover Authority v Roman Catholic Trust Corporation for the Diocese of Melbourne [2013] VCC 71 at paragraph 122
134 Pursuant to the Licensed Post Office Agreement[128] (“the Agreement”), the first defendant as licensor, licensed the second defendant to be a licensed post office. Paragraph 11 of the agreement sets out the obligations of the first defendant during the term of the agreement. Such obligations are:
[128]See exhibit 11, PCB pages 158 – 197
“(a)furnish the Licensee with the Act, the Post Office Rules and the Licensed Post Office Manual as enforced from time to time;
(b)ensure that suitable product and service information is provided to enable the Licensee to properly and amply inform customers of the nature and availability of the Products and Services;
(c)provide initial and ongoing training for the Licensee or his nominated representative. The training will cover the postal system generally, postal services and operating procedures of the licensed post office. Australia Post has no responsibility to pay the Licensee or his employees any remuneration in respect of the period of training.
(d)use its best efforts to maximise sales of Products and Services to the mutual benefit of the Licensee and Australia Post;
(e)make available to the Licensee for purchase all shelving, signage, fixtures and fittings required by the Licensee at cost price, or make available the specifications of such shelving, signage, fixtures and fittings;
(f)provide a range of specialised accounting and business reporting forms at no cost to the Licensee to be used by the Licensee in the operation of a licensed post office;
(g)maintain the integrity of the post office network by protecting the Marks and maintain the standards of the postal business system; and
(h)from time to time make available to the Licensee a list of the suppliers of complementary products.”
I consider that none of these obligations could be construed to constitute “occupation or control over the new premises”.
135 Clause 12 of the Agreement sets out the obligations of the second defendant. I set out some of these obligations:
“(f)properly supervise and be responsible for all the licensee’s employees and ensure that the licensed post office is at all times staffed with sufficient competent trained personnel to ensure quality, prompt efficient customer service
(g)comply with all applicable federal, state and municipal laws, statutes, regulations and by-laws, in the conduct and operation of the licensed post office
(h)maintain security over mail, postal articles, money and the licensed post office generally
(i)be liable for operational, managerial and financial obligations relating to the operation of the licensed post office. These obligations cannot be sub-contracted by the licensee to a third party
…
(l)ensure at all times that the licensee as the right to occupy the premises.”
136 I do accept that the first defendant did have some control over various security measures that were in place at the new premises. The first defendant provided the second defendant with information relating to security and operational matters including cash management procedures.[129]
[129]See exhibit 13 – Licensed Post Office Manual, exhibit 30
137 I also refer to one of the special conditions of the Agreement, which is headed “Security”. Clause A of that condition requires the second defendant, at its expense, to provide and maintain in the premises during the Agreement, that certain security requirements following which alarm system, special locks on the premises and locks on counter drawers all have lines drawn through them. Clause B of the condition requires that the second defendant observes the first defendant’s cash-handling policy and, in particular, Clause C of that condition states:
“The security requirement shall be reviewed by Australia Post periodically and at least every two years in consultation with the licensee, however should Australia Post require the licensee to update or increase the security requirements for the premises, such update of the security requirements must be implemented by the licensee within three months from the date of receiving notice by Australia Post.”
It is also noted in that special condition that the first defendant shall provide the second defendant with a safe for use in the operation of the licensed post office.
138 Although the first defendant provided the second defendant with information in relation to security and operational matters, including cash-management procedures,[130] the first defendant had no day-to-day control over the state of the premises, including whether employees of the second defendant made appropriate use of the security systems such as keeping the two-key safe locked and complying with appropriate cash-handling requirements. Consistent with the special condition, security audits were undertaken and the first defendant produced a Retail Security Countermeasure Reports in relation to such security audits.[131] The first defendant had no right to enter the premises of its own accord outside normal operating retail hours.[132]
[130]See exhibit 13, Licensed Post Office Manual; exhibit 30, A Guide to Post Office Security; and exhibit 31, setting out extracts from Licensed Post Office Operation Accounting Procedure
[131]See exhibit 20 (Security Survey dated 10 October 2002); exhibit 21(Countermeasures Report dated 10 October 2002); exhibit 22, (Security Survey dated 20 July 2004); exhibit 23 (Retail Security Counter Measure Report dated 20 July 2004)
[132]T20, L17 – T121, L5
139 Albanis did give evidence that the first defendant ensured that he was locking the safe at all times “because they were monitoring from the head office with the computers”.[133] However, later evidence suggests that the monitoring of cash by the first defendant involved the monitoring of cash collected by Armaguard twice a week, rather than on a constant day-to-day basis. Albanis also gave evidence that, other than the security officer who came out to the survey every two years, the only contact he had with the first defendant was when Barbara Young would come out to talk to him about once every three months when at the previous premises, and when at the new premises. Albanis explained that Young was not there to perform an audit or to “check-up” on him but, rather, to discuss strategies that might be put in place to grow the business, merchandising, presentation and signage.[134] Albanis did give evidence that he believed that someone from “security” employed by the first defendant checked over the premises after the refitting of the new premises.
[133]T351, L21 – 22
[134]T349, L10 – 15
140 After consideration of all the evidence, I am of the opinion that the first defendant did not have occupational control of the new premises either at the time of the robbery or, indeed, at any other time.
141 I now turn to what would appear, from the written submissions, to be the primary argument of counsel for the plaintiff that there was a duty owed by the first defendant to the worker arising out of the degree of control that the first defendant exercised over the second defendant in relation to the issue of security of the new premises and deterrence to potential robbers.
142 It is submitted on behalf of the plaintiff that the first defendant maintained at all times, the control over the standard of care relating to security that was provided by the second defendant. The Agreement, so it was submitted, made clear that the second defendant must comply with the first defendant’s requirements. In this sense, counsel for the plaintiff highlighted that Time-Lock Cash Containers were installed by the first defendant shortly after the robbery and at the expense of the first defendant.
143 The plaintiff submits that the position of the first defendant is analogous to the position of the TAB in TAB v Beaman[135] due to “the control which they exercised, both in contract and in fact, over the security aspects of the second defendant’s operations”. As I have already recorded in this judgment, the TAB in that case, accepted that it owed a duty of care to Beaman, who was an employee of the agent of the TAB who operated the particular TAB agency.
[135][2006] NSWCA 345
144 Furthermore, the plaintiff submits that given the control that the first defendant over security aspects of the second defendant’s operations, such a position is “akin to that in Stevens v Brodribb Sawmilling Company Pty Ltd”.[136] The plaintiff submits that although Brodribb established that there was a duty of care owed by Brodribb to employees of an independent contractor engaged by Brodribb, there is no good reason that such principle cannot be extended to customers using the licensed post office. As I have already recorded in this judgment, the principle established in Stevens was utilised in the matter of Karatajas v Deakin University.[137] In that matter, it must be stressed that the Court of Appeal held that the university, which was the occupier of the site, exercised exclusive powers of management control over the campus, including the power to direct where its contractors and employers should park their cars and, in effect, the powers which should be made available to them in order to pass between the car park and the cafeteria. Of course, the claimant in Karatajas was an employee of a contractor who operated a cafeteria at the Burwood campus.
[136](1986) 160 CLR 66
[137](2012) VSCA 53
145 Counsel for the plaintiff also refers to the High Court decision of Leighton Contractors Pty Ltd v Fox,[138] wherein the High Court held that the common law does not impose a duty of care on principles for the benefit of independent contractors engaged by them of the kind which they owed their employee. Reference was made by the High Court to Stevens and, as I would comprehend the submission by the plaintiff, that it was to the effect that the High Court recognises that in certain circumstances a duty can be owed by a principal to an employee of an independent contractor.
[138](2009) 240 CLR 1
146 I have earlier set out various terms and conditions of the Agreement and, in particular, refer to one of the obligations of the licensee (the second defendant) to:
“… maintain security over mail, postal articles, money, and the licensed post office generally.”
147 Clearly enough, the second defendant was obliged to maintain security generally in relation to the premises (which, in my view, would extend to the handling of money) and also, clearly enough, the first defendant by terms of the Agreement, had a power to request that various security precautions be undertaken, particularly in relation to the security surrounding the holding and transfer of cash in the business of the second defendant.
148 However, after consideration of all of the evidence, I have come to the view that, contrary to the submissions of the plaintiff, there was no common law duty of care on the part of the first defendant owed to the worker, who was a customer, at the relevant time. Accordingly, as there was no duty between the first defendant and the worker, there can be no breach and, accordingly, a claim by the plaintiff against the first defendant must be dismissed.
149 If I be wrong in my conclusion, and that there was a duty of care owed by the first defendant to the worker at the relevant time, I consider that the plaintiff must also fail in its claim against the first defendant for the following reasons:
(a)Any duty owed by the first defendant to the worker did not extend to taking reasonable care to prevent physical injury to the worker resulting from the criminal behaviour of third parties. In this respect, I do not consider that, to the extent there was any relationship between the first defendant and the worker, it was a relationship which can be characterised as a “special relationship”, such as between employer/employee, school and pupil or bailor and bailee. Furthermore, nor do I consider that the circumstances of this matter would allow a finding that the criminal conduct was attended by such a high degree of foreseeability and predictability, that it is possible to argue the case will be taken out of the operation of the general principle, and the law imposed a duty to take reasonable steps to prevent it;
(b)and, in any event, to the extent that if there was negligence on the part of the first defendant in breach of any such agreement, can it be said that “but for” that negligence, the robbery would not have occurred and, thus, the worker harmed (see s51(1) of the Wrongs Act).
150 I will expand on these propositions. If there is a relevant duty of care between the first defendant and the worker, it is incumbent on the plaintiff to establish, as a matter of probability, that the first defendant was negligent in failing to take reasonable precautions against a risk of harm that was foreseeable (see s48 of the Wrongs Act). Furthermore, in determining whether a reasonable person would have taken precautions against a risk of harm, the Court is to consider, amongst other things, the probability that harm would occur if care were not taken, the likely seriousness of the harm and the burden of taking precautions to avoid the risk of harm.
151 At the outset, it must be noted that the previous premises and, indeed, the new premises, had never been subject to a robbery prior to 16 December 2003. Murphy did give evidence that, in 1999, there were approximately 200 robberies of both corporate post offices and licensed post offices.
152 Furthermore, Murphy stated that over the period between 1998 and 2000, when armed robberies “were at a very high rate”, he was assigned by the first defendant to do research analysis on armed robberies at Australian Post facilities across Australia. As a result of such research and analysis, Murphy prepared a risk model called the “Four-Tier Model” for crime risk management. Such document, in broad terms, brings together three separate lines of study – the crime rate in the area, the defensible space in respect to the premises and the profile map which gives risk to a risk assessment. The fourth tier of the model is counter-measured, based on whether the risk assessment is “high”, “medium” and “low”.
153 In his evidence, Zalewski stated that he does not employ the Four-tier Model, although accepted it is one approach to “codifying a level of risk”.[139] Furthermore, Zalewski accepted that you would apply great security countermeasures for higher risk premises. As was made clear by Murphy, different premises have different degrees of risk and the Four-Tier Risk Assessment Model takes that factor, amongst other things, into account in determining the appropriate risk. Furthermore, as part of that model, countermeasures are set out, depending on the degree of risk.
[139]T319, L23
154 Zalewski, as I have stated earlier in this judgment, took a broad-brush approach in determining the degree of risk relevant to the new premises. Furthermore, Zalewski did not have material pertaining to robberies of licensed post offices that Murphy had access to in determining the relevant factors in assessing the risk for any premises.
155 Accordingly, I consider that the Four-Tier Risk Model is an entirely reasonable approach on the part of the first defendant to assess the risk of robbery and, thus, the risk of harm to people such as the worker.
156
When the security audit was undertaken of the previous premises on
10 October 2002, the risk of robbery was found to be “low”. In the Retail Security Countermeasures Report, in respect of the security survey taken on 10 October 2002,[140] there is reference to the requirement to install a Time-Lock device, which meets Standard 11.4 of the document headed “Security Standards – Retail Outlets”.[141] Of course, such audit related to the previous premises and, seemingly, the status quo would have continued until September 2003, when the second defendant moved to the new premises, at which time there was a fitting out and, seemingly, some inspection after the fitting out by an appropriate officer from the first defendant.
[140]See Exhibit 22 at PCB pages 306 – 311
[141]See Exhibit 20 at PCB pages 119 – 235
157 I also refer to the security audit undertaken on 20 July 2004[142] which occurred some seven months or so after the robbery, and also to the Retail Security Countermeasures Report of the same date.[143] In particular, it was stated in such Countermeasures Report that there had to be in place an appropriate Cash Management Plan as per Standard 11.1 of the “Security Standards – Retail Outlets” (that is, the use of Time-Lock Cash Containers) and, furthermore, there was to be a removal of excess signage and the provision of security signage consistent with Standard 27.2 of the same document (that is, the use of appropriate signage indicating that Time-Lock Cash Containers were in use).
[142]See Exhibit 22 at PCB pages 308 – 311
[143]See Exhibit 23 at PCB pages 312 – 313
158 Clearly enough, at the time of the robbery, Time-Lock Cash Containers had not been placed in the new premises and, accordingly, there was no signage advertising the fact that such premises did have Time-Lock Cash Containers. Shortly after the robbery, such Time-Lock Cash Containers were added to the new premises by the first defendant at its cost.
159 Considering all the evidence, I have come to the view that the Four-Tier Model is an appropriate process to assess the risk of robbery at a licensed post office, and the new premises was assessed as “low”. However, bearing in mind that such a risk assessment has to be undertaken and that such assessment revealed a risk, albeit low, does suggest that there was a foreseeable risk of robbery and consequential harm that was not insignificant.
160 Furthermore, consistent with my views about the Four-Tier Model, I consider that it was reasonable on the part of the first defendant, in response to such assessment of risk, to set out in a Countermeasures Report, the matters which had to be attended to do.
161 By not attending to those matters, whether it be on the part of the first defendant or second defendant, would constitute a breach of any duty of care (if there be one) owed by the first defendant to the worker.
162 Although I do note that Murphy gave some evidence that a safe with a two-key compartment does serve a “similar function to the Time-Lock Cash Container”, he went on to state that the convenience of a Time-Lock Cash Container is that it is at the counter, and thought to encourage more frequent use by being closer to the counter as a temporary place to store cash before it goes into the two-key compartment.[144] Also, Murphy later said, under cross-examination by counsel for the second defendant, that although both methods do secure the cash, it is “a standard to have a Time-Lock Cash Container, so I would say not having one for us is not acceptable.”[145]
[144]T11, L8 – T101, L20 generally
[145]T135, L16 – T136, L2
163 Accordingly, it may be accepted if there was a duty owed by the first defendant to the worker, such duty was potentially breached by the failure to comply with the requirements of the Countermeasures Report. I leave aside the issue as to whether the responsibility lay with the first defendant and/or the second defendant to comply with such report.
164 Counsel for the plaintiff expressly refers to the case of Ogden v Bells Hotel Pty Ltd[146] in support of his submissions in relation to the breach of any agreement and the causation. Insofar as the submission relates to breach, the learned trial judge in Ogden accepted the evidence of the expert relied on by the plaintiff,[147] and held that there was a breach of duty by the hotel to the plaintiff, who was an employee of the hotel. In my view, the matter can be clearly distinguished, in part, by the facts so found by the court and, also, in relation to the issue of Modbury, in that the court found a special relationship, given the employment of the plaintiff by the defendant.
[146][2009] VSC 219
[147]Such evidence was from Zalewski
165 Counsel for the plaintiff submitted the general principle in Modbury is avoided because of the special circumstances of the relationship between the first defendant and the worker. As I have already recorded, counsel for the plaintiff draws the analogy with the TAB and Stevens matters.
166 I reject such submission and am not satisfied, as a matter of probability, that any particular special relationship existed between the first defendant and the worker. As I have already noted, the claimant in the TAB matter was an employee of the agent engaged by the TAB, and in Stevens, the complainant was an employee of a sub-contractor engaged by the Brodribb Sawmilling Company. Such situations are consistent with the dicta of Gleeson CJ, when he referred to certain relationships which may involve one having a duty to take reasonable care to protect the other from criminal behaviour of third parties – which include employer and employee, school and pupil or bailor and bailee. Furthermore, although accepting that there was a foreseeable risk of harm from criminal conduct by a third party, I do not accept that the criminal conduct is attended by such a high degree of foreseeability and predictability that it is possible to argue that the case will be taken out of the operation of the general principle, and the law may impose a duty to take reasonable steps to prevent it. As I have noted, the previous premises and the new premises had never been subject to a robbery and, on the basis of the Four-Tier Model, had been assessed as “low” risk.
167 I also refer to Lesandu,[148] wherein Basten JA was critical of the concept that a special relationship extends to customers inside and outside any particular store.
[148]Op cit
168 Accordingly, I am of the opinion that the general principle set out in Modbury is applicable, even in the event that there is a duty of care owed by the first defendant to the worker.
169 Even if I be wrong in that conclusion, I find that the plaintiff has failed to discharge its onus to establish, as a matter of probability that, but for the breach of duty involving the failure to have Time-Lock Cash Containers and appropriate signage, the robbery would not have taken place and, thus, no harm to the worker.
170 It may be accepted that, based on the evidence of Albanis, insofar as he describes the circumstances of the robbery, and the interpretation by Zalewski of those circumstances, it is probable that the robbers were professional robbers given the way they went about the robbery, and the time it took to complete the robbery.
171 After a consideration of all the evidence, I consider that the evidence of Murphy is apposite to this issue. In particular, I refer to the following evidence which occurred during the cross-examination of Murphy by counsel for the plaintiff.
Q:“But the number of robberies, and I have just been through this with you, has decreased markedly since 2003 for instance …?---
A:Yes.
Q:I’m just repeating that question, but that’s because of – it can be put down to the increased security-measures that had been put in place …?---
A:I certainly believe that has been a contributor, yes.
Q:And that includes the time-lock devices and the security signs, amongst other things?---
A:It does include those yes.
Q:And that in turn means that those matters have contributed to a reduction in the number of armed robberies?---
A:I can’t point to individual items and say they have contributed or what degree they have contributed. I can say that the package of security as a whole have contributed as a whole to the reduction.
Q:And part of that package are security signs and the time-lock devices?---
A:That is true.”[149]
[149]T197, L19 – T198
172 It is to be remembered that s51(1)(a) that it must be established, as a matter of probability, that the negligence was a necessary condition of the occurrence of the harm. In particular, I refer to the following evidence:
(a) Murphy gave evidence that:
(i)robberies that took place in the last twelve months or so all had signage in place[150]
(ii)most of the robberies at Australia Post outlets in recent years had taken place where Time-Lock Cash Containers had been in place[151]
(iii)fully compliant outlets (that is outlets with Time-Lock Cash Containers and signage) get robbed and more of the robberies in the last twelve months were compliant outlets rather than non-compliant;[152]
(b)As I have already noted, Zalewski did not have access to the same material that Murphy had in relation to robberies at licensed post offices, and gave his evidence in a broader style. However, in allowing for, perhaps, a broader allegation of negligence, Zalewski ultimately offered the opinion that the security measures which he advocated cannot eliminate the risk of robbery but can “greatly minimise” and “diminish” the risk of those events occurring;[153]
(c)Zalewski also accepted, under cross-examination by counsel for the second defendant, that criminals are not necessarily dictated by reasonable or prudential considerations that he had no reliable information about the particular motivation or modus operandi of the robbers in this particular robbery, that he did not know whether the robbers were determined, or how determined or reckless they were in their approach, that he did not know whether there was any inside knowledge prior to the robbery, that he did not know whether the robbers had any prior knowledge of the cash handling procedures in the premises and, in particular, when Armaguard trucks came and he did not have any knowledge as to when the robbers had any appreciation of time-ck cash containment, or whether the robbers would have read a sign or comprehended a sign if it had been there.
[150]T125, L19 – 22
[151]T126, L1 – 7
[152]T145, L23 – T146, L1
[153]T330, L29 – T33, L29
173 I also refer to what the High Court stated in Adeels Palace:
“… recognising that changing any of the circumstances in which the shootings occurred might have made a difference does not prove factual causation. Providing security at the interests of the restaurant might have delayed the gunmen’s entry; it might have meant that, if Mr Bou Najem was a random victim, as seemed to be the case, someone else might have been shot and not him. But neither plaintiff proved factual causation by pointing to possibilities that might have eventuated if circumstances had been different.”[154]
[154]Adeels Palace (op cit) at paragraph [50]
174 Accordingly, pursuant to s51(1)(a) of the Wrongs Act, I am not satisfied that the plaintiff has discharged its onus to prove, as a matter of probability, that any negligence was a necessary condition of the occurrence of the harm (that is, factual causation).
The liability of the Second Defendant
175 There is no issue that the second defendant was an occupier of the new premises at the time of the robbery. So much is conceded by the second defendant. Counsel for the plaintiff sought to distinguish Modbury and avoid the proposition that an occupier’s duty did not extend to taking reasonable care to prevent physical injury to the injured employee resulting from the criminal behaviour of third parties on the premises. Counsel for the plaintiff referred to the dicta of Gleeson CJ in Modbury, wherein he states:
“There may be circumstances in which, not only is there a foreseeable risk of harm from criminal conduct by a third party, but, in addition, the criminal conduct is attended by such a high degree of foreseeability, and predictability, that it is possible to argue that the case would be taken out of the operation of the general principle and the law may impose a duty to take reasonable steps to prevent it. The possibility that knowledge of previous, preventable, criminal conduct, or of threats of such conduct, could arguably give rise to an exceptional duty, appears to have been suggested in Smith v Littlewoods Ltd … .”[155]
[155]See Modbury (op cit) 267 at paragraph [30]
176 Counsel for the plaintiff submitted that the evidence established that there was a “clear repetitious and ongoing course of criminal behaviour involving licensed post offices, such behaviour having only one motive: armed robbery for money”. For reasons which I have already stated, I reject such submission, as the risk associated with the premises where the robbery occurred was low, based on the four-tier model, and indeed, as I have recorded, there is no knowledge of previous, preventable criminal conduct or threats of such conduct at the premises which could give rise to an exceptional duty. As was pointed out by Murphy, both licensed post offices and corporate post offices have different profiles as to the risk of robbery and it would be inappropriate, in my view, to make one general assertion that applies to each and every licensed post office, either in Victoria or throughout Australia.
177 In all the circumstances of the matter, I do not accept that there was any special relationship or exceptional circumstances between the second defendant and the worker which would cause the principle enunciated in Modbury to be set aside. I have come to this view for essentially the same reasons I have already expressed in this judgment in relation to the first defendant.
178 Again, if I be wrong about that, I apply the same principles to which I have made reference in considering the liability of the first defendant. Although there may well have been a more than insignificant foreseeable risk of robbery and consequential harm to the worker, such risk was assessed to be low and there was a reasonable response to that risk given the Countermeasures Report.
179 Again, leaving aside whether the first defendant and/or second defendant had the ultimate responsibility of bringing about any security alterations, I accept that the failure to introduce Time-Lock Cash Containers and the appropriate signage falls short of incorporating the measures set out in the Countermeasures Report.
180 Even if that be the case, I consider for the reasons which I have already noted, the Modbury principle does not permit that the duty owed by the occupier to include a duty to take reasonable steps to prevent harm to another from the criminal conduct of a third party.
181 In the same way, even if I be wrong about that, I am not satisfied that the plaintiff has discharged its onus in establishing, as a matter of probability, factual causation for the reasons which I have already enunciated earlier in this judgment relevant for the first defendant.
Conclusion
182 I have come to the view that neither the first defendant nor the second defendant has a liability to the plaintiff. In particular, any “injury” suffered by the worker was not caused under circumstances creating a liability in the first defendant and/or the second defendant to pay damages. The proceeding must be dismissed. I will hear the parties on the question of costs.
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