Walsh v Little and Ors;O'Brien v Little and Ors

[2009] NSWSC 267

CITATION:	WALSH v LITTLE & ORS;O'BRIEN v LITTLE & ORS [2009] NSWSC 267
HEARING DATE(S):	26 September 2008
JUDGMENT DATE :	8 April 2009
JURISDICTION:	Common Law
JUDGMENT OF:	Hall J at 1
DECISION:	Orders set out in paragraphs 1 and 2 of the first and second defendants' notice of motion dated 27.6.08 (filed on 30.6.08) are refused. Accordingly, the applications are dismissed.
CATCHWORDS:	NEGLIGENCE - LEASES - SUMMARY DISPOSAL OF PROCEEDINGS – plaintiffs/respondents fell from a cliff on reserve land, the reserve being contiguous to the hotel/motel land upon which the respondents entered as visitors – hotel/motel subject to a lease – applicants/first and second defendants – moved for orders striking out proceedings against them – whether arguable case that applicants as owners/lessors under a duty of care to respondents – danger – cliff behind trees on reserve – no fencing, warning signs, illumination - principles on summary disposal applications - liability of lessors to persons other than the tenant - plaintiffs' causes of actions not unarguable - not clear cases for striking out - notices of motion dismissed
LEGISLATION CITED:	Liquor (Entertainment Areas) Regulation 1985 Supreme Court Rules 1970 Uniform Civil Procedure Rules 2005
CASES CITED:	Agar v Hyde (2000) 201 CLR 552 Aitken v Kingborough Corporation (1939) 62 CLR 179 Breheny v Cairncross [2002] NSWCA 69 Brimson v Rocla Concrete Pipes Limited (1982) 2 NSWLR 937 Cole v Tweed Heads Rugby Football Club Limited (2004) 78 ALJR 933 Dey v Victorian Railways Commissioners (1949) 78 CLR 62 Dyson v Attorney-General [1911] 1 KB 410 Fancourt v Mercantile Credits Limited (1983) 154 CLR 87 Ford v Nagle [2004] NSWCA 33 General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 Jones v Bartlett (2000) 205 CLR 166 Modbury Triangle Shopping Centre Pty Limited v Anzil (2000) 205 CLR 254 Northern Sandblasting Pty Limited v Harris (1997) 188 CLR 313 Parker v South Australian Housing Trust (1986) 41 SASR 493 Philip Morris Inc v Adam P Brown Male Fashions Pty Limited (1981) 148 CLR 457 Roads & Traffic Authority of NSW v Dederer (2007) 87 ALJR 1773 Romeo v Conservation Commission (1998) 192 CLR 431 Smith v Leurs (1945) 70 CLR 256 Webster v Lampard (1993) 177 CLR 598 Wickstead v Browne (1992) 30 NSWLR 1
PARTIES:	Stephen James WALSH (by his tutor, Janice Mary WALSH) v Robert Francis LITTLE & ORS Darren Andrew O'BRIEN (by his tutor, Katrina Anne O'DONNELL) v Robert Francis LITTLE & ORS
FILE NUMBER(S):	SC 20302 of 2002; 20308 of 2002
COUNSEL:	Ps: K Connor SC/W Walsh 1-2D: J Drummond/M G McHugh 3-8D: R B Dickson 9D: S Glascott
SOLICITORS:	Ps: K P Carmody & Co 1-2D: Kemp & Co 3-8D: Shaw McDonald Pty Limited 9D: DLA Phillips Fox

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

HALL J

WEDNESDAY 8 APRIL 2009

No 20302 of 2002
No 20308 of 2002

STEPHEN JAMES WALSH (by his tutor, JANICE MARY WALSH) v ROBERT FRANCIS LITTLE & ORS

DARREN ANDREW O’BRIEN (by his tutor, KATRINA ANNE O’DONNELL) v ROBERT FRANCIS LITTLE & ORS

JUDGMENT
(Application to strike out proceedings against the first and second defendants)

1 HIS HONOUR: The defendants, Robert Francis Little and Valerie Elizabeth Little (the first and second defendants and to whom I shall refer as “the applicants”) move by notices of motion dated 27 June 2008 for orders striking out the proceedings against each of them brought by Stephen James Walsh (by his tutor, Janice Mary Walsh) and Darren Andrew O’Brien (by his tutor, Katrina Anne O’Donnell).

2 The applicants contend:-

(1) The proceedings fail to disclose any reasonable cause of action, are frivolous and are an abuse of process pursuant to Rule 13.4, Uniform Civil Procedure Rules 2005.

(2) The proceedings fail to disclose any reasonable cause of action, have a tendency to cause prejudice, embarrassment and/or delay and thereby are an abuse of process pursuant to Rule 14.28, Uniform Civil Procedure Rules .

3 The notices of motion was supported by the affidavit of Andrew John Kemp, solicitor, sworn 27 June 2008.

4 The plaintiffs, the respondents to the motions, relied upon the affidavit of Mr Keith Patrick Carmody, solicitor, sworn 1 September 2008 and a bundle of documents marked Exhibit A. Mr Connor did not press paragraphs 12 to 24 of Mr Carmody’s affidavit and relied upon those paragraphs only as submissions.

5 The original Statements of Claim have been amended on a number of occasions. The most recent pleading upon which the plaintiffs proceed are the Fifth Further Amended Statements of Claim.

Summary disposal of proceedings and strike-out applications

6 Rule 13.4 of the Uniform Civil Procedure Rules under which the applicants seek order 1 in the notice of motion is concerned with summary disposal of proceedings. By Rule 13.4(2), the Court may receive evidence on the hearing of an application for an order under sub-rule (1).

7 In respect of the order sought in paragraph 2 of the notice of motion, Rule 14.28 of the Uniform Civil Procedure Rules empowers the Court to strike out the whole or any part of a pleading.

8 In Brimson v Rocla Concrete Pipes Limited (1982) 2 NSWLR 937, Cross J examined the equivalent provisions under the Supreme Court Rules 1970. His Honour there noted that in respect of the power to strike out pleadings (a statement of claim), it is necessary to show that it does not, on its face, disclose a reasonable cause of action or otherwise that the statement of claim tends to cause prejudice, embarrassment or delay or is otherwise an abuse of a process of the Court (at 941). As his Honour noted in that case (at 942), the mere fact that the case is weak and not likely to succeed is not a ground for striking a validly formulated pleading. Accordingly, the reference to “the pleading” in Part 14, Rule 14.28 makes clear that it is only where the pleading itself is defective in not disclosing a cause of action or otherwise because it tends to cause prejudice, embarrassment or delay or is otherwise an abuse of the Court, that the Court has the power to strike out the whole or part of the proceedings. For reasons which I will develop, I do not consider that the pleading, the Fifth Further Amended Statement of Claim, is amenable to a strike out order under Rule 14.28 as, in my opinion, it does plead a properly formulated cause of action in negligence and no particular argument has been made that the pleading itself falls within the provisions of Rule 14.28(b) or (c).

9 Accordingly, the primary basis for relief in these applications is Rule 13.4 of the Uniform Civil Procedure Rules which is not limited to pleadings but empowers the Court to dismiss “proceedings” on the basis, inter alia, that they disclose no reasonable cause of action or are otherwise frivolous or vexatious or constitute an abuse of the process of the Court.

10 I will refer below to the principles concerning the summary disposal of proceedings. It is sufficient here to note a fundamental principle, discussed by Cross J in Brimson (supra), that in proceeding under Rule 13.4 of the Uniform Civil Procedure Rules (the equivalent of Part 13 Rule 5 under the Supreme Court Rules):-

“Where the Court is asked to reject a plaintiff’s case, either under its statutory rules or its inherent jurisdiction, the fundamental principle is that prima facie a plaintiff is entitled to have his case come to trial; and applications to deprive him of that right will succeed only in the clearest of cases. True, the Court will not look merely at the suggested weakness of the plaintiff’s case but – though to a less extent – at the suggested strength of the defendant’s case; and, true, forensic argument and subsequent judicial reflection are not necessarily inconsistent with a firm conclusion that the cause of action should not be allowed to proceed. But fatal defects in the plaintiff’s case must be very clear before the Court will intervene in this fashion.” (at 944 to 945)

Factual matters

11 The proceedings arise out of two separate accidents that occurred after midnight during New Year’s Eve celebrations on the evening of 31 December 1993/1 January 1994 in which both plaintiffs suffered very severe injuries. Each had been on premises known as the Tathra Hotel/Motel. The licence for the hotel permitted entertainment to be given by a number of bands on the hotel premises.

12 In the early hours of 1 January 1994, the plaintiffs on separate occasions walked from the hotel premises on to adjoining reserve land. The boundary between the hotel premises and the reserve was unmarked and unfenced. The case for each plaintiff is that, having walked from the hotel premises, they, in separate incidents, fell over a cliff face located on the reserve land adjoining the hotel/motel premises to its base.

13 The Tathra Hotel/Motel is located on the southern side of Bega Street, Tathra, a short distance from Tathra Headland.

14 The applicants at all material times were the owners/lessors of the Tathra Hotel/Motel as joint tenants in equal shares, having purchasing the premises from C A Wheeler & Associates Services Pty Limited in December 1983. The land is known as Certificate of Title Volume 14035 Folio 32 and Volume 13816 Folio 48.

15 On or about 18 August 1986, the applicants leased the hotel/motel to the third to seventh defendants for a period of 10 years with an option to renew the lease for a further three years. The lease was comprised within Memorandum of Lease No W564220. The term of the lease commenced on 17 September 1986 and terminated on 13 August 1996. The lease is said to have been registered on 19 November 1986.

16 It is alleged in the proceedings that, on or about 19 December 1989, the applicants sold a one third share in the hotel/motel land to the third to seventh defendants (the Roberts and the Ryans) in equal shares, the latter holding their interest as tenants in common with the applicants.

17 The licence for the hotel/motel is known as Licence No 109091, and was held by Coral Betty Ryan (seventh defendant) as and from 29 March 1988.

18 The plaintiffs assert that the applicants, subsequent to the lease and up to the date of the accident, remained residents of Tathra.

The Fifth Further Amended Statement of Claim

19 In the Fifth Further Amended Statement of Claim, it is alleged that Mr O’Brien drove his car between the hotel and motel and was directed and/or allowed to park his car on the lawn on the seaward side of the motel near a bank of tea trees and other vegetation running along the coastal edge of the reserve land. In paragraph 143 of the Fifth Further Amended Statement of Claim, it is alleged that at one point in the evening Mr Walsh decided to spend the night in Mr O’Brien’s car or camp next to it.

20 In paragraph 146 of the Fifth Further Amended Statement of Claim in proceedings by Mr Walsh, it is alleged that, shortly after arriving at Mr O’Brien’s car, Mr Walsh walked into the vegetation along the coastal edge of the reserve land to go to the toilet. It is alleged that he followed a path into the vegetation and fell off the cliff edge.

21 In the Fifth Further Amended Statement of Claim a number of facts are pleaded, some of which are said to be relevant to all defendants and others are specifically directed to the applicants.

22 The facts relied in the former category include:-

• That Tathra is a small village on the south coast of New South Wales with a resident population of approximately 1,500.

• That in the Christmas period, 26 December 1993 to 2 January 1994, the population of the village increased at least threefold.

• The Tathra Hotel situated at 2-10 Bega Street, Tathra is situated “on or very near to the Tathra Headland” (paragraph 6).

• The Tathra Hotel “was the main venue for entertainment for both the local population and the tourists who visit Tathra (paragraph 30).

• That over 2,000 people would congregate on the “Hotel/Motel Land and the reserve that surrounds it, including the Tathra Headland during the New Year’s Eve events” (paragraph 34).

• That the Tathra Hotel had established a reputation of providing “high quality rock bands” (paragraph 41).

• That there were at least two bands that played in the entertainment area of the hotel on New Year’s Eve 1993.

• That between the hotel/motel land and the Pacific Ocean was a reserve referred to as “the reserve land” (paragraph 50).

• That the boundary between the hotel/motel land and the reserve land was unfenced.

• That the reserve land on its eastern side had a cliff of about 50 metres to sea level.

• There was no sign warning of the presence of or location of the cliff.

• That the eastern edge of the reserve land was covered in vegetation.

• There were no signs to indicate the boundary between the hotel/motel land and the reserve land.

• There was no lighting on the reserve land.

• The distance between the edge of the hotel/motel land and the cliff was variable and ranged from five to 30 metres.

23 In respect of the applicants, the respondents alleged, inter alia:-

• That they knew of the features of the reserve land as described by the plaintiffs or, alternatively, they ought to have known of such features.

• That the applicants knew or ought to have known of the foreseeability of the risk of injury to persons entering upon the reserve land.

• That the applicants owed a duty of care to the plaintiffs which they breached, particulars of which are set out in paragraph 150 of the Fifth Further Amended Statement of Claim.

The strike out applications

24 Notices of motion filed on 30 June 2008 were filed in the proceedings brought by Mr Walsh and Mr O’Brien. They are in the same terms. It was accepted for the purposes of the applications that in essential respects there is no substantial difference in the pleadings (the Fifth Further Amended Statement of Claim) in respect of the action brought on behalf of Mr O’Brien and Mr Walsh.

25 On the hearing of the notices of motion on 26 September 2008, Mr J Drummond of counsel appeared with Mr M G McHugh of counsel for the first and second defendants/applicants and Mr K Connor SC with Mr W Walsh of counsel appeared on behalf of the plaintiffs/respondents in each of the proceedings.

26 An aerial view of the Tathra Headland was produced by Mr Drummond and marked as MFI 1. In addition, a series of photographs taken in 2005 were produced showing the location of the Tathra Hotel which faces Bega Street. The photographs look in an easterly direction towards the end of the Tathra Headland. The six photographs were together marked as Exhibit 1 on the applications.

27 It was accepted by the parties that the photographs do not purport to show the precise structural and other circumstances as at 31 December 1993/1 January 1994. They were intended to serve as a guide only. In relation to photograph number 2 of Exhibit 1, Mr Connor observed that the bottle shop shown in that photograph was, as at 1993, behind and not beside the hotel. The last two photographs of Exhibit 1 depict an area where Mr O’Brien’s car is said to have been parked on the evening of 31 December 1993.

28 Mr Drummond read the affidavit of Andrew John Kemp, solicitor, sworn 27 June 2008 in support of the applications. Exhibited to Mr Kemp’s affidavit were a number of documents marked as Exhibit AJK1.

29 Pages 6 and 7 of Exhibit AJK1 are copies of plans of the relevant parcels of land. The hotel and motel were located on Lots 30 and 31. Lot 30 was slightly to the north of Lot 31.

30 A copy of the relevant lease of the premises by the applicants, Mr and Mrs Little, is contained within pp.8 to 32 of Exhibit AJK1. The previous volume and folio numbers describing the land correspond to the new lot numbers to which I have referred.

31 At pp.33 to 35 of the Exhibit AJK1 is a copy of a letter from the Liquor Administration Board in the year of the accident, dated 1 November 1993 addressed to the licensee and imposing conditions on the licence. The plaintiffs rely upon certain of these conditions. Apart from the imposition of noise levels, including those occasions on which “live rock music is to be performed in the hotel”, other particular conditions include conditions 4 and 5 which were in the following terms:-

“4. The departure of patrons from the hotel is to be supervised and patrons advised both verbally and via signage that they are to leave the vicinity of the hotel quickly and quietly.
5. The licensee is to advertise the fact that there is to be no camping on the hotel grounds and the reserve surrounding it.”

32 In addition, the conditions include a requirement for security officers:-

“8. On nights when entertainment is provided, the hotel engage not less than two (2), and during holiday periods, not less than four (4), uniformed security officers to patrol the vicinity of the hotel, the car parks and the area surrounding the hotel, to ensure that patrons leave quickly and quietly.
Such patrols are to continue until all patrons have left the area.”

33 A location map provided by the plaintiffs’ solicitors at p.65 of Exhibit AJK1 identifies the position of the hotel in Bega Street and its proximity to the reserve land area.

34 A copy of a statement by Mr Barry John Walsh was tendered by Mr Drummond and it was marked Exhibit 2. According to it, Mr Walsh had not, prior to 31 December 1993, visited the Tathra Hotel area. He had arrived at Tathra in a vehicle driven by a friend, Lachlan Adams. He and his friends arrived at about 8.00 pm. The closest car park that they could find, he stated, was 150 metres away from the front of the Tathra Hotel down the main road. He said that there were cars all along the road and there must have been 300 to 400 people in the front of the Tathra Hotel. He said there were also a number of cars parked in the car park and on the grassed area behind the Tathra Hotel. He said there were also tents pitched in that area. He described the hotel as “overflowing with people” and as the night wore on, “people drifted towards the rear of the Hotel” (paragraph 13). He described, after being told of his brother’s accident, how he rushed to the reserve area. He noted “a reasonable amount of people immediately behind the motel” and that there were “… about a dozen or so cars and a number of tents and swags interspersed with the cars in the grassed area behind the Motel and to the right of the Hotel” (paragraph 23).

35 Mr Walsh also stated:-

“24. There was a thick line of bushes at the end of the grassed area behind the Motel. You could not tell that there was a cliff there nor how steep it was because it was hidden by the bushes. There was no warning signs nor any fence behind the Motel grounds and the cliff. The Reserve was not fenced off nor was there any lighting.”

36 In relation to the area depicted in the last three photographs of Exhibit 1, some logs on the ground shown in the third last of the photographs were apparently set back a little from the boundary of the reserve land. Beyond the logs, the land commenced to descend and in that general area there is a sewerage or pump station located at water level. The logs were said to mark the point where the land commences to fall away, initially in a gentle fashion.

37 Exhibit A comprises a number of documents tendered on behalf of the respondents. They include a survey plan (p.15) dated 5 November 1987. The diagram depicts the location of the hotel and motel on Lots 30 and 31, the location of the Tathra Sewerage Pump Station and a track leading to an easement that extends from the left side of the survey plan to the sewerage pump station.

38 Exhibit A also contains documentation relating to a grant made to the applicants in respect of an application lodged by them on 4 September 1985 pursuant to Regulation 4(3)(a) of the Liquor (Entertainment Areas) Regulation 1985. The documents indicate that an authorisation was granted for “a maximum number of 300 persons at one and the same time, including staff and entertainers” (Exhibit A, p.10).

39 Exhibit A contains a copy of a surveyor’s certificate in respect of Lot 30 in DP 606559 and Lot 31 in DP 600036. The copy of the Survey Certificate does not identify the date upon which the survey was undertaken. The Certificate states that some of the boundaries were not fenced and that, in respect of the sewerage pump installation “… apparently the Council officers are using the Hotel car park as access to the pump station by an agreement between the owners and Council …”.

40 Mr Connor indicated that the car in which the plaintiffs had travelled had been either parked on the reserve land or it may have been parked near to it on the hotel/motel land. He stated (transcript, 26 September 2008, p.14) that that would be a factual issue for determination in the cases.

41 The Fifth Further Amended Statements of Claim refer to the occurrence of two accidents as having occurred some years before at different points on the cliff face of Tathra Headland. The first is said to have occurred on or about 13 October 1988 involving a male by the name of Graham William Paynter and the other on or about 30 December 1988 involving a male, Lloyd Gullick, who it is alleged fell off at one point of the cliff at the Tathra Headland following drinking at the Tathra Hotel. Mr Gullick apparently escaped serious injury.

42 Exhibit A (at p.19) contained a police report in relation to an accident concerning Mr Paynter. The relevant entry records the accident as having occurred on 13 October 1989 at 11.30 pm. The record refers to Mr Paynter’s body having been found at the bottom of the 50 metre cliff. The record further records the deceased, Mr Paynter, having drunk heavily on the day of the accident. He had left the Tathra Hotel at about 12.15 am and the witnesses had said that he had been “well affected by liquor”.

43 The plaintiffs rely upon these incidents. The entry in relation to the deceased, Mr Paynter, records:-

“Appears the deceased may have been urinating at top of cliff and due to his extreme state of intoxication has accidentally fallen.”

44 In relation to the incident involving Mr Paynter, Mr Drummond in submissions stated that the fall seems to have occurred on “the beach side of the Tathra Headland” but stated there was some uncertainty about the matter. Mr Drummond, in seeking to meet the plaintiffs’ case in relation to prior accidents, stated that there was no evidence of anyone having moved from the hotel/motel land to the reserve and fallen from the cliff in that area. He emphasised that the incidents did not occur in the area of the cliff seaward of the hotel/motel but took place at points well removed from it.

45 Included in Exhibit AJK1 was a copy of a letter dated 2 June 2008 addressed to the plaintiffs’ solicitors (pp.36 to 45) and the response from the plaintiffs’ solicitors dated 17 June 2008 (pp.46 to 61).

46 In the letter requesting particulars, the following questions and answers appear:-

“4. As to paragraph 21:-
(i) Q. Specify each fact, matter or circumstance upon which the plaintiff relies in support of the assertion that the First and Second Defendants had ‘sufficient control over the Hotel/Motel Land’ to be occupiers of that Land.

A. They were owners and lessors of the hotel/motel land. The use of the hotel/motel land by the lessees was subject to the terms and conditions of the lease registered number W564270. We refer you particularly to clauses 4(b), 4(e), 5, 7(c)(iv), 7(j), 8(b)(ii) and 15(c) of the memorandum to the lease.
5. As to paragraph 22:-
(i) Q. Specify the capacity in which it is asserted that the Littles attended at the New Year’s Eve event in 1993 .
A. This is known to them and is not a proper request for particulars.
(ii) Q. Does the plaintiff assert that the Littles attended the New Year’s Eve event in 1993 in any capacity other than as a guest?
A. The plaintiff makes no assertion as to what capacity the Littles attended the New Year’s Eve event in 1993.
…
21. As to paragraph 73:
(i) Q. Specify each fact, matter and circumstance upon which the plaintiff relies to alert that the First and/or Second Defendant knew of the features of the Reserve Land identified in paragraph 68.
A. They were business or freehold owners and operators of the Tathra Hotel/Motel from early 1980 until August 1986 when they leased the Hotel/Motel land to the fourth to seventh defendants. They remained in Tathra as residents from August 1986 until at least January 1994 and frequented the Hotel/Motel land during that period.
22. As to paragraph 74:-
(i) A. Specify each fact, matter and circumstance upon which the plaintiff relies to assert that the First and Second Defendants ought to have known of each of the features of the Reserve Land identified in paragraph 68.
A. See answer to 21 above.
23. As to paragraph 77:-
(i) Q. Specify each fact, matter and circumstance upon which the plaintiff relies to assert that the First and/or Second Defendant knew or ought to have known of the existence of the foreseeability of risk of injury to persons who entered the Reserve Land.
A. Refer to answer to particulars arising from paragraph 68 above.
24. As to paragraph 85:-
(i) Q. Specify each fact, matter and circumstance upon which it is alleged that the first and/or second defendant ‘set up a temporary structure on the Hotel/Motel Land for use as a food stall’.
A. This is a matter for evidence.
…
29. As to paragraph 114:-
(i) Q. Specify the facts, matters and circumstances upon which the plaintiff relies to assert that the First and Second Defendants were aware or ought to have been aware that visitors to Tathra for the New Year’s Eve celebration parked their cars on the Reserves around the Hotel/Motel land.

A. (i) The First and Second Defendants owned the Hotel/Motel land;

(ii) The First and Second Defendants lived at Tathra which is a small community of approximately 1,500 people;

(iii) The First and Second Defendants attended the New Years Eve events.
…
30. As to paragraph 115:-
…
(iii) Q. Specify each fact, matter and circumstance upon which the plaintiff relies to assert that the First and Second Defendants were aware or ought to have been aware of people remaining on the Hotel/’Motel Land overnight.
A. (i) The First and Second Defendants owned the Hotel/Motel land;

(ii) The First and Second Defendants lived at Tathra which is a small community of approximately 1,500 people;

(iii) The first and Second Defendants attended the New Years Eve Celebrations.

(iv) There were cars parked overnight and tents pitched overnight at the rear of the Tathra Hotel/Motel.
…
36. As to paragraph 148:-
(i) Q. Specify the steps which the plaintiff asserts the first or second defendant ought to have undertaken to:
(a) prevented;
(b) hindered; and/or
(c) discouraged
Walsh from entering the Reserve Land from the Hotel/Motel Land.
A. Exercised their rights as Lessors under the lease. The lease provided sufficient control to the Littles to allow them to take appropriate steps such as fencing of the Hotel/Motel land and placing warning signs warning of the danger posed by the cliff along the seaward side of the Reserve Land so as to make the area more safe for visitors to the Hotel/Motel land or prevent patrons from camping on the Hotel/Motel Land or remaining there overnight.
…
37. As to paragraph 150:
(i) Q. As t subparagraph (h) specify each fact, matter or circumstance upon which the plaintiff relies to assert that the First and Second Defendants had an obligation to remove or reduce the vegetation situated along the cliff and the eastern edge of the Reserve Land.
A. It is alleged that in the circumstances outlined in the Statements of Claim particularly paragraph 68 and the terms and conditions of the lease coupled with the Littles knowledge of the New Years Eve events and the fact that they also attended these events enlivened a duty of care by them to the invitees on the Hotel/Motel land to take steps to assess and lessen the likelihood of injury occurring to New Years Eve revellers who were on or in the vicinity of the Hotel/Motel Land.
(ii) Q. As to subparagraph (m) specify each fact, matter and circumstance upon which the plaintiff relies to assert that there was a duty to ascertain and minimise dangers including a risk of falling off the cliff edge for persons upon the Reserve Land.
A. It is alleged that in the circumstances outlined in the Statements of Claim particularly paragraph 68 and the terms and conditions of the lease coupled with the Littles’ knowledge of the New Years Eve events and the fact that they also attended those events and were or ought to have been aware that invitees camped on the Hotel/Motel Land or stayed on the Hotel/Motel land overnight and so should have taken steps to assess and lessen the likelihood of injury occurring to New Years Eve revellers who were on or in the vicinity of the Hotel/Motel Land or else requested the Roberts/Ryans to do this.
(iii) Q. As to subparagraph (n) specify each and every condition of the hotelier’s licence upon which the plaintiff relies to assert that there was a failure on the part of the First and Second Defendants to comply with those conditions.
A. It is alleged that the First and Second Defendants failed to ensure compliance by the lessees of conditions 4, 5 and 8 contained in the letter dated 1 November 1993 to the Licensee of the Tathra Hotel.
…
(vi) Q. As to subparagraph (t) specify each fact, matter and circumstance upon which the plaintiff relies to assert that the First and Second Defendants allowed the lessees of the Tathra Hotel to conduct a New Year’s Eve party in 1993.
A. The Plaintiff relies on the fact that the First and Second Defendants knew or ought to have known of the risk alleged due to the fact that they had been: (i) owners of the Tathra Hotel since at least August 1986 when the lessees first commenced to lease the hotel; (ii) they still lived in Tathra; (iii) had attended New Years Eve celebrations at the hotel in the previous years; (iv) and that there had been numerous complaints made to authorities about non-compliance with conditions of the Hotelier’s Licence of which they were aware or ought to have been aware.
…”

Submissions for the applicants

47 Mr Drummond and Mr McHugh of counsel relied upon their written submissions dated 25 September 2008, their oral submissions given on 26 September 2008 and written submissions in reply dated 28 November 2008.

48 In support of the contention that there was no reasonable cause of action disclosed against the applicants in either proceedings, reliance was made, in particular, upon the following facts:-

(1) The hotel/motel premises were, at all material times, the subject of a lease for a term of 10 years commencing 17 September 1986 and operative as at the date of the accident.

(2) The lease related to the whole of the land and not merely part. The provisions relating to “common areas” as defined were only of relevance in respect of a lease where only part of the premises was “designated” and were retained by the lessor. That was not this case.

(3) The applicants did not have any possession or control over the leased premises.

(4) The provisions of the lease did not impose any obligations upon the lessor, breach of which would support the plaintiffs’ causes of action.

(5) There was no contention by the plaintiffs in the proceedings that, as at 31 December 1993, the premises were used for activities or purposes other than as a hotel for the sale and consumption of alcohol and provision of accommodation.

(6) The asserted breaches of conditions 4, 5 and 8 of the licence was not maintainable. Condition 4 merely required the licensee to advice patrons verbally and by signage to leave the vicinity of the hotel “quietly and quickly” . In addition, condition 4 had as its clear purpose the dispersal of persons from the hotel and its vicinity to prevent disturbance to neighbours.

(7) Condition 8 had a similar purpose.

(8) Condition 5 required the licensee to advertise that there was to be “no camping” on the hotel grounds and the reserve surrounding it. If it be assumed that this condition, when read with conditions 4 and 8, implicitly imposed an obligation on the licensee to prevent camping on the hotel grounds. There was no enforceable right in the licensee to prevent persons from camping on lands that did not form part of the hotel/motel premises.

(9) The right to control activities on the reserve land was at all times in the Bega Valley Shire Council and not anyone else.

(10) None of the clauses in the lease, relied upon the by plaintiffs, imposed any positive obligation to do or refrain from doing any specific act.

49 Mr Drummond addressed the question as to the applicants’ alleged duty of care to prevent breaches of the lease by the lessees, and/or of the licence.

50 The contention for the applicants was that relevant case law establishes clear limits on any duty of care that the law may impose on non-occupying landlords. In that respect, the duty was said to be limited to dangerous defects of which the lessor had knowledge when the premises were let. In oral submissions, Mr Drummond contended “… a landlord does not have a duty to control the activities or to control to an extent to prevent a third person – in this case, the licensee and lessee of the land – from causing damage to a third person. We say we are one step removed from that …” (transcript, 26 September 2008, p.19).

51 At common law, he relied upon the proposition that it was exceptional to find a duty to control another’s actions to prevent harm to strangers, relying upon dicta in Smith v Leurs (1945) 70 CLR 256 at 262.

52 In relation to the plaintiffs’ contention that the applicants breached their duty of care by failing to fence or otherwise prevent persons leaving the hotel/motel land, Mr Drummond stated in oral submissions (transcript, 26 September 2008, p.17):-

“It is our respectful submission that obligation which they assert against us is one which cannot be correct in law.”

53 He relied in support upon the observation of Callinan J in Cole v Tweed Heads Rugby Football Club Limited (2004) 78 ALJR 933 at 954 to 955 to the effect “there exists at law no power to restrain from departing occupied premises without facing the tort of ‘false imprisonment’”. It was submitted for the applicants that the plaintiffs were seeking to impose a duty of care “… in circumstances where there exists no power at law to perform” (written submissions, p.46).

54 Reliance was also placed upon the observations of the High Court in Roads & Traffic Authority of NSW v Dederer (2007) 87 ALJR 1773 at [51]:-

“An obligation to exercise reasonable care must be contrasted with an obligation to prevent harm to others. The former, not the latter, is the requirement of the law. The common law distinguishes between an act affecting another person and an omission to prevent harm to another. If people were under a legal duty to prevent foreseeable harm to others, the burden imposed would be intolerable. In Heymann , Brennan J emphasised that the common law recognises ‘a duty to take reasonable care to avoid doing what might cause injury to another, not a duty to prevent injury being done to another by that other; by a third person, or by circumstances for which nobody is responsible’.”

55 Reliance was also placed on dicta of Gleeson CJ in Modbury Triangle Shopping Centre Pty Limited v Anzil (2000) 205 CLR 254 at [36].

56 In the written submissions for the applicants at [39], the dicta of Gummow and Hayne JJ at 222 in Jones v Bartlett (2000) 205 CLR 166 was set out as follows:-

“The general principle … is that liability for injury suffered by an entrant upon residential premises primarily will rest with the occupier. A tenant in occupation, rather than the landlord, has possession and control with power to invite or to exclude, to welcome in or to expel. Those asserting a duty often will be the guests or invitees of the tenant or persons present on the tenant’s business or for their business with the tenants. It will be a tenant who is best placed to inform such persons of any dangers or defects …, and the tenant who ‘is more directly in touch with emerging repair needs than a landlord who has suffered possession’.
…
Nevertheless, the duty of the landlord owed to third parties, in many cases, will be narrower than that owed to them by an occupier such as a tenant. … The duty of care of the landlord to the third party is only attracted by the presence of dangerous defects in the sense identified earlier in these reasons. These involve dangers arising not merely from occupation and possession of the premises, but from letting out of premises as safe for purposes for which they were not safe. What must be involved is a dangerous defect of which the landlord knew or ought to have known.”

57 In the submissions for the applicants, it was further contended:-

“42. The duty therefore owed by a non-occupying landlord to a third party is one limited to defects that are ‘more than are dangerous, they are dangerous in a way not expected by their normal use’ (see Jones v Bartlett per Gummow and Hayne JJ at 195–199 [sic] , see paragraph 39 above).

58 In relation to the facts and circumstances in the present, it was contended on behalf of the applicants that the absence of a barrier or fence between the reserve land and the hotel/motel land was not “a defect in the hotel/motel land”, nor did the absence of a barrier or fence give rise to any danger “not expected by its normal use” ([44]).

59 It was contended that no defect sufficient to create a foreseeable danger in the hotel/motel land had been identified nor particularised by the plaintiff. It was contended that this was because the breach of duty alleged “relates to a defect located on the Reserve Land” (at [44]).

60 In relation to the question of knowledge, it was submitted for the applicants that there was no evidence that established knowledge on the part of either of the applicants that any person had previously fallen from the relevant part of the Tathra Headland having after walking from the seaside boundary of the hotel/motel land.

61 It was further submitted for the applicants that the plaintiffs’ claim principally related to a defect in land of which the applicants were neither the landlord nor the occupier:-

“… to extend the duty of care to impose on Mr and Mrs Little an obligation to protect persons who had departed from the land from a danger or defect in a third party’s land is contrary to the principles (see paras 34 – 42) and the law. There exists no warrant to extend the principles set out above to encompass the proposition advanced by the plaintiffs. This is particularly so in circumstances where the defect or danger the cause of the injury was located a significance distance from the boundary between the hotel/motel land and the reserve land.”

62 Additionally, it was submitted for the applicant that, even if a fence had been erected, there was simply no evidence that that would have prevented access to the reserve land, there being alternative means of access to it. It was also contended for the applicants that the absence of a fence did not constitute “a defect” arising from the “normal use of the land” but was a defect arising from the activities that were permitted to be carried on on the hotel/motel land. The absence of a fence was not a defect in the static condition of the land.

63 In relation to the reserve land, there was no obligation, it was contended on behalf of the applicants, to eliminate a defect or danger on the far side of the reserve. Mr Drummond emphasised in oral submissions (transcript, 26 September 2008, p.19) that, by reference to the judgment of Gleeson CJ in Modbury (supra), where an accident occurs elsewhere other than on land occupied by (in that case) the appellant, there was no possible basis for a duty of care, Mr Drummond contending “… we say that applies directly in this case”. He emphasised that there was no defect on the hotel/motel land for which a sign or warning was required, the injury in these cases having clearly been sustained on the reserve land.

64 Mr Drummond further contended, as recorded at p.19 of his oral submissions, that:-

“This is a case of effectively not a defect in the land but injury which may arise out of activities on the land. Because a person is invited in as a patron – assuming all the facts against us for present purposes – in this case we have an absence of a defect in the land under occupation by the lessees. If there is a defect in the land, it is located in the reserve land and looking at the position and whether or not the duty of care arises at least as regards the lessees, we would submit that we would have a strong argument that they would not have a duty of care in respect of a defect on a third party’s land.”

65 In relation to the alleged failure to advise or warn, Mr Drummond in oral submissions referred to the incident involving the deceased Mr Paynter and posed the question “… would there be a duty on the occupier of the land to advise Mr Paynter that on the far side of the headland there is a cliff some distance away. It is not land over which the licensee or occupier has control. As in this case, neither the licensee nor my clients have any control over the reserve land” (transcript, 26 September 2008, p.17).

66 He further contended that there were no particulars in the pleading against the land owner of any “defect in the land”. Mr Drummond stated (transcript, 26 September 2008, p.18):-

“In the absence of any particulars identifying on the hotel/land a defect in respect of which there is a duty to advise the patron or invitee, the real issue being raised is: does the duty of an occupier extend to and include advising an invitee or patron of a danger in a third party’s land or beyond a third party’s land.”

67 Mr Drummond then went on to acknowledge (transcript, 26 September 2008, p.18):-

“It may well be that if the cliff either forms part of or is immediately adjacent to the southern boundary of the reserve land, different issues may arise. But we would submit that the principles are clear – if differentiating between activities on the land and defects in the land, it is clear that the duty of care and the absence of defects in the land under control – the duty does not extend to having to warn of defects beyond the boundaries of that land …”

68 Mr Drummond further submitted that the law did not “… require us to prevent or hinder a person from leaving the land …” (p.18). He stated that the conditions of the licence required “the dispersal of persons, not their retention or preventing them from leaving. We submit that in this case there is a fundamental difficulty with the plaintiffs’ claim when it is postulated as one to prevent or hinder or discourage” (transcript, 26 September 2008, p.18).

69 On the issue of consumption of alcohol, it was submitted that the applicants, being neither the licensee or the occupier, were not in a position to exercise any control or to regulate the consumption of alcohol on the hotel/motel land. Even if they had been in that position, reliance was placed upon the observations of Gleeson CJ at [18] and Callinan J at [125] in Cole (supra).

70 In relation to the contention that the applicants owed a duty of care to prevent Mrs Ryan, the licensee, from breaching conditions of the licence, such breaches did not create any statutory cause of action. The conditions of licence were imposed on the licensees, not on the applicants. Accordingly, no duty of care arose in that respect on the applicants to ensure that the licensee complied with the conditions.

Submissions for the respondents

71 A number of factual matters were set out in the respondents’ written submissions that were said to relate to the question as to whether the applicants owed the plaintiffs a duty of care and, if so, the content of that duty. The matters identified at [58] are as follows:-

“(1) Mr Little was the licensee of the Tathra Hotel from January 1980 until August 1986 when he transferred the hotel licence to one of the Lessees when the Hotel/Motel was leased. Presumably at the end of the Lease the ‘hotel license’ would be transferred back to Mr Little or to a new lessee.

(2) In December 1983 the applicants became the registered proprietors of the two lots on which the hotel and motel stood (the Littles’ Land).

(3) The Littles’ Land was located next to a Reserve that was bound on one side by a steep cliff.

(4) The Littles’ Land was not demarcated from the Reserve.

(5) There was never a fence on the border of the Littles’ Land with the Reserve.

(6) There was a driveway from the Littles’ Land onto the Reserve that was open to the public. The Littles permitted the Council workers to access the Reserve via their Land and through this use a well marked track down to the seaward side of the Motel was created.

(7) There was a drive-through bottle shop at the rear of the Hotel.

(8) The entrance to the motel was from a car parking and driveway area between the motel and hotel on the Littles’ Land.

(9) From early the 1980s the Littles sought to provide entertainment for the public on their Land by way of performances by bands.

(10) The number of people who attended Tathra for New Years Eve grew steadily from 1981. People congregated on the Tathra Headland and in the Littles’s Land.

(11) The Littles built an entertainment area at the rear of the hotel.

(12) The Littles sought and obtained authority to provide public entertainment for 300 people in the internal entertainment area at the rear of the hotel.

(13) The entry to the entertainment area was along the side of the hotel and closer to the Reserve than the entrances to the main part of the hotel, which were on the street front.

(14) There was no lighting on the Reserve.

(15) The entertainment area brought many people onto the Littles’ Land.

(16) The Littles knew that patrons of the hotel may well be or become affected by alcohol.

(17) The Littles knew the danger presented by the cliff to persons who entered upon the Reserve, particularly at night where the edge of the cliff was obscured by vegetation and with persons whose judgment may be impaired by alcohol.

(18) The Littles leased their land yet retained substantial control of parts of the premises. Under the Lease, the Littles (i) retained ‘absolute control’ of the outside of the premises and the entrances to the premises and the building; (ii) controlled the ‘common areas’, which included arrangements as to parking on the Littles’ Land; and (iii) reserved to themselves control of the use of the ‘demised premises’.

(19) From at least 1986 or 1987 the Tathra Hotel was advertised as ‘the raging centre of the South Coast’.

(20) Entertainment at the Tathra Hotel was advertised widely, in particular for New Years Eve.

(21) Many of the persons who came to Tathra and the hotel were from out of town and unfamiliar with the geography of the Tathra headland.

(22) The Littles were aware that persons were coming onto the Land, including the Reserve, on the seaward side of the Hotel/Motel and camping overnight, particularly on New Years Eve.

(23) On News Years Eve 1992/3 there was illegal camping and parking of cars on the reserves around the Tathra Hotel and failure of the Hotel to control its patrons.

(24) In November 1993 the Licensing Court imposed additional conditions on the hotelier’s licence concerning patrons leaving the hotel, camping on ‘hotel grounds and the reserve surrounding it’ and security officers.

(25) The Littles allowed large-scale events to be held on their Land in furtherance of their commercial interest in the goodwill of the hotel, motel, bottle shop and entertainment business.

(26) The Littles knew that the Licensees and Lessees were not conducting the hotel and entertainment businesses in accordance with the conditions of the Licence and the authority granted.”

72 The respondents relied upon the very detailed submissions of Mr Connor and Mr Walsh dated 28 October 2002 (Plaintiffs’/Respondents’ Reply to Applicants’ Submissions). I mean no disrespect in not referring in detail to all of the very many matters raised in the submissions but I will seek to identify the principal matters relied upon.

73 In response to the applicants’ submissions, it was stated that the plaintiffs/respondents do not limit the duty of care contended for as merely being a duty to take steps to ensure that the respondents were prevented/hindered or discouraged from entering the reserve land. Reliance was placed upon the breaches of duty alleged in paragraph 148 in addition to paragraph 150 of the Fifth Further Amended Statement of Claim. Additionally, the plaintiffs, it was stated, did not merely rely upon the contention that the applicants owed them a duty of care as occupiers. Reliance was placed on many other matters establishing other factual bases for the duty of care contended for in each case.

74 In the latter respect, reliance, in particular, was placed upon certain provisions of the lease that established that the applicants had reserved to themselves as lessors a “measure of control”.

75 In relation to the plaintiffs’ presence on the hotel/motel premises, it was part of the respondents’ cases that the hotel, apart from its ordinary function as a hotel, was also a venue for public entertainment and on 31 December 1993 provided access to the reserve for persons “to sleep in or around their cars” (at paragraph 13).

76 It was also emphasised on behalf of the plaintiffs that the duty relied upon and the breaches pleaded included matters that were “independent of the conduct of the Lessees” (at paragraph 18).

77 Issue was taken with the description of the applicants as “absentee landlords”. The respondents’ cases were that the applicants had “the requisite knowledge and control to make (them) liable as occupiers, independently of other considerations” (at paragraph 20).

78 In response to the submissions for the applicants that no “defect” existed on the hotel/motel land, it was contended on behalf of the respondents that “defects” existed on both the applicants’ land and on the reserve land and that “the absence of a barrier on the applicants’ Land is a ‘defect’ in their land” (at paragraph 27).

79 It was further contended that the risk of injury presented by the Tathra Headland was “obvious” given the fact that the hotel/motel land was contiguous with the reserve land that it was common ground that there was no fence and that there was nothing to distinguish or indicate the boundary between the two properties. Accordingly, a person would not know the point at which he or she had moved from the applicants’ land to the reserve land.

80 In relation to the powers which it was claimed the applicants had reserved to the themselves under the lease, it was contended that any one of a number of measures could have prevented the plaintiffs from being exposed to the risk of falling off the cliff at night by the exercise of such a power (at paragraph 32).

81 In the Plaintiffs’/Respondents’ Reply to Applicants’ Submissions, at pp.13 to 17, submissions are made in relation to three of the cases relied upon in the submissions of the applicants, namely, Jones v Bartlett (supra), Cole (supra) and Modbury (supra). I do not here set out the detail of the submissions made on behalf of the plaintiffs concerning each of these cases. It was contended in relation to each that there was no principle or matter in any of the judgments which would warrant or provide a basis for the plaintiffs’ cases being summarily dismissed.

82 It was contended that there were a number of considerations that were relevant to the issue as to whether the applicants owed the plaintiffs a duty of care and, if such a duty is established, the content of the duty. These were identified as:-

• Foreseeability of risk of harm.

• The applicants’ knowledge of the risk of harm being the danger presented (by) the cliff face, entertainment events at night attracting comparatively large crowds and the provision of alcohol to patrons.

• The extent of the applicants’ capacity to control the risk before granting the lease and during the term of the lease.

• The purpose for which, and the circumstances in which, the plaintiffs came to be on the applicants’ land and on the reserve land.

• The vulnerability of visitors to the Tathra hotel arising from a lack of awareness of the danger presented by the cliff face.

83 There were a considerable number of factual matters identified and which were said to bear upon the duty of care question and the content of the asserted duty. These are recorded in paragraph 58 of the respondents’ written submissions.

84 It was submitted that the questions of duty and extent of duty were complex and wholly unsuited to being determined summarily. Reliance was placed upon the observations of Hayne J in Modbury (supra) wherein, inter alia, his Honour stated:-

“Because the extent of a duty falls for decision in relation to ‘concrete facts arising from real life activities’ ( Perre per McHugh J at [80]), it will not always be useful to begin by examining the extent of a defendant’s duty of care separately from the facts that give rise to a claim. That may be possible, and useful, in a simple case (like motorist and injured road user) where the duty of care and its contents are well established. In other cases, however, it may lead to an insufficiently precise formulation of the duty which obscures the issues that require consideration. That lack of precision may lie in formulating the duty too narrowly: for example, by asking, did the defendant owe a duty of care to fence the part of the cliffs in its reserve from which the plaintiff fell? It may also, as in this case, lie in formulating the duty too broadly: for example, by asking did the defendant owe any duty of care to the plaintiff?”

85 In paragraphs 60 to 66, submissions were made as to the considerations which would prevent the respondents’ cases from being determined by way of summary dismissal. These included the well-known principles in relation to summary dismissal applications to which I will refer below.

86 The respondents relied upon the fact that in this case, only two out of nine defendants applied for summary dismissal and, for that reason alone, the Court would be precluded from making an order for summary dismissal. In this respect, reliance was placed upon Wickstead v Browne (1992) 30 NSWLR 1 per Handley and Cripps JJA at 11G to 12A-C and the application of the principle in Breheny v Cairncross [2002] NSWCA 69, per Meagher JA at [3] and in Ford v Nagle [2004] NSWCA 33.

87 In paragraph 63 of the written submissions for the respondents it was stated:-

“63. A major consideration is that what will ultimately constitute the facts and the matters will be very significant in determining whether the applicants owed the plaintiffs a duty of care and, if so, in determining the content of that duty. This case is one where it is not only not useful but likely to result in error if an attempt is made to describe the extent of the duty separately from the facts that give rise to them.”

88 Reliance was placed upon the fact that the law of negligence in its application to landlords is in “its early stages of development” (at paragraph 64). Reference was made, inter alia, to the High Court’s decision in Northern Sandblasting Pty Limited v Harris (1997) 188 CLR 313.

89 It was contended for the respondents that the applicants had failed to establish that the plaintiffs’ cases should be summarily dismissed.

Consideration

(1) Summary dismissal proceedings

90 The Court is empowered by Part 14 Rule 14.28 of the Uniform Civil Procedure Rules to dismiss proceedings where:-

(1) The proceedings are frivolous or vexatious, or

(2) no reasonable cause of action is disclosed, or

(3) the proceedings are an abuse of process of the Court.

91 It is an established principle that the power to strike out proceedings on the basis that they disclose no reasonable cause of action is one to be exercised only in plain and obvious cases: General SteelIndustries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125. A case is not “plain and obvious, and the power to strike out should not be generally exercised where there is a real issue to be tried, whether one of fact or law”: Dyson v Attorney-General [1911] 1 KB 410.

92 The written submissions on behalf of the respondents refer to the well-known principles enunciated by the High Court. These include:-

• “A case must be very clear indeed to justify the summary intervention of the court to prevent a plaintiff submitting his case for determination … once it appears that there is a real question to be determined whether of fact or law and that the rights of the parties depend upon it, then it is not competent for the court to dismiss the action as frivolous and vexatious and an abuse of process” : Dey v Victorian Railways Commissioners (1949) 78 CLR 62.

• “The plaintiff ought not be denied access to the customary tribunal which deals with actions of the kind he brings, unless his lack of a cause of action … is clearly demonstrated. The test to be applied has been variously expressed; ‘so obviously untenable that it cannot possible succeed’; ‘manifestly groundless’; ‘so manifestly faulty that it does not admit to argument’; ‘discloses a case which the Court is satisfied cannot succeed’; ‘under no possibility can there be a good cause of action’; ‘be manifest that to allow them ‘the pleadings) to stand would involve useless expense’. … the need for exceptional caution in exercising the power whether it be inherent or under the statutory rules is the same … in my opinion great care must be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal” : General Steel (supra).

• The power “should never be exercised unless it is clear that there is no real question to be tried” : Fancourt v Mercantile Credits Limited (1983) 154 CLR 87.

• “Nowhere is that need for exceptional caution more important than in a case where the ultimate outcome turns upon the resolution of some disputed issue or issues of fact” : Webster v Lampard (1993) 177 CLR 598.

93 In Agar v Hyde (2000) 201 CLR 552 at 577, Gaudron, McHugh, Gummow and Hayne JJ at [24] referred to the observations on Barwick J in Philip Morris Inc v Adam P Brown Male Fashions Pty Limited (1981) 148 CLR 457 at 473 to the following effect:-

“[In] fact pleading as it was introduced in the judicature system, there is necessity to assert or identify a legal category of action or suit which the facts assert may illustrate, involve or demonstrate and on which the particular relief claimed in based or to which it is relevant.”

94 Their Honours in Agar (supra) then stated at 578:-

“The result is that frequently the conventional form of pleading in an action of negligence will not reveal the alleged duty with sufficient clarity for a court considering an application for summary termination of the proceeding to be sure that all of the possible nuances of the plaintiff’s case are revealed by the pleadings. Further, and no less importantly, any finding about duty of care will often depend upon the evidence which is given at trial. Questions of reliance or knowledge of risk are two obvious examples of the kinds of question in which the evidence given at trial may take on considerable importance in determining whether the defendant owed the plaintiff a duty of care.”

95 I accept, for reasons discussed below, the submission made on behalf of the respondents at [63] of the written submissions to the effect:-

“… This case is one where it is not only not useful but likely to result in error if an attempt is made to describe the extent of the duty separately from the facts that give rise to the claim.”

(2) Issues of risk and danger

96 An issue raised by the allegations in the Fifth Further Amended Statement of Claim is whether, at the time the lease was granted, there existed a foreseeable risk arising from the possibility of hotel patrons entering upon the reserve.

97 The relevant test expressed by Dixon J in Aitken v Kingborough Corporation (1939) 62 CLR 179 at 210 focuses attention on the nature of the danger itself assessed prior to the event according to the obviousness of the danger and the care ordinarily exercised by the public. Observations on this test were made by Brennan J in Romeo v Conservation Commission (1998) 192 CLR 431 at 445 and 455.

98 On the respondents’ cases, at the time that the lease was granted by the applicants, the hotel premises had been modified so as to create an entertainment area on the seaward side of the hotel. On the basis of the material tendered in the present applications, the respondents contended that it was foreseeable that hotel patrons attending or present on the hotel premises on New Year’s Eve who were unfamiliar with the reserve might wander off the hotel premises onto it.

99 In the way in which the respondents plead and particularise their respective cases, they contend that there was a forseeable risk and a danger arising from a combination of static factors that operated on the two properties, namely, the location of the two properties being contiguous to each, the absence of a protective fence or barrier to prevent or limit entry onto the reserve, the fact of the cliff face and, what is said to be, concealment of the cliff by the vegetation (the tea trees) that was located in the area between the property boundary and the cliff.

100 The respondents’ cases are brought upon the basis that neither of them were unfamiliar with the area between the boundary of the two properties and they had no knowledge or appreciation that beyond the vegetation there was a cliff, that is, of what amounted to a concealed danger.

101 In my opinion, there are a number of factual matters, some involving complexity, which would render the present cases unsuited to being determined summarily. Reliance was placed by Mr Connor upon observations of Hayne J in Modbury (supra) at 289, [103] which I have extracted in paragraph [84].

102 I further accept Mr Connor’s submissions that these cases do not arise in a settled area of the law of tort in which the liability of landlords in negligence has been plainly established. That is a separate and relevant matter in deciding whether the respondents’ cases against the applicants should be summarily dismissed. Reliance was placed in the written submissions for the respondents upon the observations of Gaudron J in Northern Sandblasting (supra) in relation to the liability of landlords in negligence, namely:-

“… there has been no systematic development of the law of negligence in its application to landlords. Thus, neither the content nor precise nature of the duty owed by a landlord can be discovered from the case law.”

103 I consider this is particularly relevant in a case involving a commercial lease of hotel premises. In Jones v Bartlett (supra), Gummow and Hayne JJ at 169 observed:-

“This case, like Northern Sandblasting , is concerned with a letting for residential purposes. What follows is to be understood with that in mind. That which is required in respect of premises let for commercial or educational or other purposes may well differ, but that is not for decision in this case.”

104 The nature of the respondents’ cases as framed in the respective pleadings and particulars involves, in part, allegations of negligence by omission including, in particular, the failure to erect a barrier or fence on the boundary between the hotel premises and the reserve, the failure to ensure a warning sign was erected and a failure to install illumination. The respondents’ cases, however, are not entirely based on such omissions.

105 They allege that the applicants modified the premises so as to make them suitable for the conduct of entertainment on a comparatively large scale under the authorisation obtained by them, before the lease, for conducting entertainment on the hotel premises. As a consequence of those innovations, the plaintiffs contend the hotel operated for the purpose of the supply of beverages (including alcohol), and as a venue or place of entertainment at least at times, for comparatively large crowds of people.

106 The abovementioned innovations undertaken prior to the lease proceeds upon the basis that it was known and envisaged before the lease was granted that such large groups of people including, in particular, young patrons, would attend and assemble on the premises for functions such as New Years’ Eve Celebrations.

107 The development of the hotel prior to the lease with a view to expanding business was, the respondents claim, undertaken without necessary precautions having been taken to guard against hotel patrons walking onto adjacent land where there existed a real and foreseeable danger.

108 The fact that the danger (the cliff) or the concealed danger (the cliff behind the tea trees) was located on the reserve land and not on the applicants’ land is a matter, as I have earlier noted, emphasised in the submissions for the applicants. In many circumstances such a fact may be critical. However, the operation of the danger in the present case is one for consideration on the particular facts of the case as pleaded.

109 An example or an analysis of the point may be considered as follows. Whilst two parcels of land in different ownership may be readily identified by title and survey boundary details, in their physical form where they are contiguous with one another and there is no evident physical separation between them to a person who unknowingly crosses the boundary (there being no structural barrier), other circumstances may potentially arise. On one of the two parcels of land (Lot A) the owner, or if it is leased, the lessee, may carry on an activity that attracts members of the public on to that land. The neighbouring lot (Lot B) may not attract any visitors by reason of its undeveloped condition or lack of access. Where there is a known danger on Lot B and the only persons ever likely to access Lot B are visitors to Lot A, then a question could, in my opinion properly, arise as to whether there is a duty or responsibility of or in the owner and occupier of Lot A at a particular point or points in time to take steps to implement appropriate safeguards on the boundary. Of course, issues concerning “knowledge”, “control” of land and control of risk amongst others may arise for consideration.

110 Senior counsel for the respondents has contended that, having regard to relevant provisions in the lease, the applicants had both control in respect of the leased premises and the power to implement safety precautions. The issue of “control” in respect of premises has been an important issue in many cases in determining the issue of “duty” and the nature and extent of the duty. However, it is unnecessary in these applications to determine whether ultimately the respondents’ reliance upon the issue of control in the context of other matters will or will not encounter difficulties at trial.

111 In addition to the position that existed at the commencement of the lease, the respondents also contend that, during the term of the lease, the applicant lessors, had retained control over the outside areas of the hotel/motel premises. Reliance in this regard is placed, in particular, upon the provisions of clause 4(e) of the lease which referred to “absolute control” being vested in the applicants over the “outside of the premises and the entrances to the premises”. This, the respondents’ contend, vested in the applicants power which the respondents will seek to argue at trial should have been exercised before the date of the accident to fence off the hotel premises from the reserve land and to have put in place other safety measures that have been particularised.

112 In relation to premises that are the subject to a lease, it has been recognised that on the question of the duty of care in a landlord, difficulty may arise in determining the nature and extent of any duty: Jones v Bartlett (supra) per Gummow and Hayne JJ at 214. It was there observed:-

“… the ‘circumstances’ to be considered may differ between landlord and tenant and landlord and other persons. There is no necessary correlation between the respective duties, although the latter is likely to be less stringent than the former …”

113 As their Honours stated in that case, the duty of the landlord owed to third parties, in many cases, will be narrower than that owed by an occupier such as a tenant. However, the issue for consideration and determination on the present strike-out applications is whether, on all the facts and circumstances that have been identified as those relied upon by the respondents, if proved, they are capable of supporting a duty in the applicant/lessors to ensure that the condition of the premises as leased did not lead to a foreseeable risk of injury. As Gummow and Hayne JJ observed in Jones v Bartlett (supra), the duty of care of a landlord to a third party is only attracted by the presence of dangerous defects, examples of which were provided at [197]. It is important in this context to observe their Honours further observation on the nature of the dangers that may give rise to the duty:-

“197. These involve dangers arising not merely from occupation and possession of premises, but from letting out of premises as safe for purposes for which they were not safe. What must be involved is a dangerous defect of which the landlord knew or ought to have known.”

114 A distinctive and, perhaps novel, factual aspect in the present case is, as discussed earlier, that the immediate danger associated with the accidents (falling from the cliff) did not exist within the boundaries of the hotel/motel premises. However, the plaintiffs’ case is that the cliff, in the absence, inter alia, of a barrier or fence on the boundary of the premises, always posed a potential to a particular class of persons, namely, hotel patrons (including the respondents) who crossed the unmarked boundary between the two premises.

115 The significance of these matters to the respondents’ cases in the determination of the present applications is not so much how they may inform the nature and extent of the duty, but is in recognition of the fact that a duty of care between landlord and “other persons” than the lessee will depend upon “the circumstances” including the physical relationship of the leased premises to adjoining premises and activities carried on on the former.

116 The present proceedings involve a question as to a duty of care said to arise in connection with premises carried on for commercial purposes, namely, as a hotel/motel and as an entertainment venue. The decisions of the High Court in Northern Sandblasting (supra) and in Jones v Bartlett (supra) were concerned with a letting for residential purposes. Gummow and Hayne JJ in Jones v Bartlett at [169] observed that what was stated in Jones v Bartlett was to be understood in the context of a residential lease and, as noted earlier in this judgment, their Honours stated:-

“… that which is required in respect of premises let for commercial or educational or other purposes may well differ, but that is not for decision in this case.”

117 The respondents alleged that the premises were not reasonably fit for the purpose of conducting comparatively large scale events which may bring patrons into close proximity to the danger on the reserve land. It is part of their case that the applicants ought to have been aware of that fact at the time they leased the hotel/motel and during the term of the lease.

118 Gummow and Hayne JJ observed in Jones v Bartlett (supra) at [177] that some dangerous defects will exist at the time of entry into a tenancy agreement while others might develop during the course of the tenancy. Rather than determining into which category it falls, their Honours observed:-

“… a better approach is to look at the origin of the defect, particularly whether it arises from faulty design or workmanship, at whatever stage, or whether it arises from a lack of repair. Those responsible for negligent design or building will ordinarily be liable as primary tortfeasors. Liability for disrepair will ordinarily fall upon the party with the obligation to repair. Liability for negligent repair ordinarily will fall on the repairer.”

Conclusions

119 It is not the law that a landlord owes no duty of care with respect to leased premises: Northern Sandblasting (supra) per Brennan CJ at 340 and Dawson J at 342 to 370; Jones v Bartlett (supra) and Parker v South Australian Housing Trust (1986) 41 SASR 493, 514 per King CJ.

120 Whilst those cases involve questions concerning the duty of care of lessors to occupants of leased premises, there is no principle that would deny that a landlord of commercial premises, such as a hotel, may, in some circumstances, owe a duty of care to persons invited onto the premises, including patrons of the hotel.

121 The existence of a duty in the present case is said to have arisen in the particular circumstances relied upon by the plaintiffs. These include the leasing of the premises without a physical barrier such as a fence, to prevent or minimise the risk of patrons walking from the hotel grounds, across the unmarked boundary into the reserve land, without warning or notice that a cliff was located beyond the tea trees on the reserve.

122 In addition to the condition of the premises at the time the lease was granted, the plaintiffs rely upon the lease provisions whereby the lessor retained “absolute control” over “the outside of the premises” which includes the boundaries to the premises. They also rely upon the existence of a power under the lease given to the applicants to effect “alterations to the demised premises” in accordance with clause 7(j) of the memorandum incorporated in the lease. This power, it is alleged, provided the applicants with the capacity to alter the premises so as to render them safe by putting in place the suggested precautions and safeguards. These are questions for determination at a trial.

123 The respondents additionally relied upon the alleged knowledge in the applicants of the presence of large crowds at New Year celebrations at the Tathra Hotel and headland. The respondents rely upon the fact that persons attending events at the hotel were allegedly known to sleep overnight either on the hotel/motel land or on the reserve adjoining it.

124 As has been observed (paragraph [112]) much depends on the facts or “circumstances” in determining issues of “duty” and the nature and extent of duty. The observations in Jones v Bartlett (supra) set out in paragraph [112] emphasises, inter alia, the need for the “circumstances” of each case, including those between a landlord and persons other than the tenant, to be the subject of close scrutiny. That ordinarily can only be properly undertaken at trial. Hence the observation made by Barwick CJ in General Steel (supra) at 129:-

“… The jurisdiction summarily to terminate an action is to be sparingly employed and is not to be used except in a clear case where the Court is satisfied that it has the requisite material and the necessary assistance from the parties to reach a definite and certain conclusion.”

125 In the present case, there are a number of factual and other circumstances that have been particularised by the respondents in support of their cases upon which their claimed rights depend. Such circumstances are only capable, in my opinion, of being properly determined at trial. These include:-

• The condition of the premises in terms of safety as at the commencement of the lease.

• The matters of “control” and “power” which the respondents contend were vested or conferred on the applicants by the provisions in the lease.

• The nature of the activities conducted upon the hotel/motel premises both at the commencement of the lease and during its term up to the date of the accidents.

• The circumstances in which persons were allegedly permitted to camp or stay overnight on the outside areas of the premises and/or the adjoining reserve land.

• The proximity on the seaward side of the hotel of the cliff face and the alleged obstruction of the location of the cliff by the tea trees on the reserve land.

• The nature and extent of the applicants’ knowledge in relation to the factual matters referred to above.

• The factual and legal issues as to the alleged responsibility for precautions such as fencing, warning signs and illumination.

126 I find that it is impossible to classify the respondents’ claims as clearly unarguable or, in the phraseology employed by Cross J, as “demonstrably exucontian”: Brimson (supra) at 948.

127 This is not, in my opinion, an instance where the hopelessness of the plaintiffs’ case is revealed with such clarity to justify the Court’s intervention on a summary application. Having regard to the principles which I am required to apply, it would be a quite inappropriate exercise of the Court’s power to strike out the respondents’ cases on a summary application before trial. It follows that the applications must be dismissed.

128 Accordingly, the notices of motion in each case are dismissed.

129 I will hear the parties on the question of costs.

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