Charter Hall Real Estate Management Services (NSW) Pty Limited v State of New South Wales

[This headnote is not to be read as part of the decision.] The appellant challenged a decision of a judge of the District Court ordering that the respondent (plaintiff at first instance) be indemnified under s 151Z(1)(d) of the Workers Compensation Act 1987 (NSW) for payments made to an employee, a Mr Mark McMullen in respect of an injury suffered by him in the course of his employment. Mr McMullen was a member of the Fire Brigade and an employee of the respondent, the State of New South Wales. On 22 January 2007 Mr McMullen responded to an alarm at the Metro Plaza Shopping Centre in Orange with a number of his colleagues. The fire panel indicated that the alarm was triggered from an air-conditioning unit on the roof of the shopping centre. Access to the roof was obtained through an access door located at the top of a ladder. The access door had a metal locking bar in front of it which had to be raised in order to access the roof. After verifying the incident was a false alarm Mr McMullen descended that ladder and knocked the locking bar with his elbow and was injured as a result of its falling. It was for this injury that the workers compensation payments were made to Mr McMullen by the respondent. The appellant was one of two joint managers of the shopping centre and had entered this role on 1 January 2007 some three weeks before the incident involving Mr McMullen. The appellant conceded that it owed the duty of an occupier of the shopping centre.

The Court of Appeal (Macfarlan and White JJA, and Simpson AJA) unanimously dismissed the appeal holding:

Per White JA (Macfarlan JA and Simpson AJA agreeing respectively at [1] and [90]) (i) Did the appellant have actual knowledge of the risk posed by the locking bar? The appellant had actual knowledge of the risk posed by the locking bar due to reports of incidents with the locking bar made by a security guard, Mr Willox to centre management including Ms Chapman, who had become an employee of the appellant: [8], [36], [37], [50]. The knowledge of Ms Chapman could be imputed to the appellant: [46], [47], [48]. In any event the appellant ought to have been aware of the risk: [49]. Civil Liability Act 2002 (NSW) s 5B(1)(a), applied. Although Mr Willox was not certain when he made his reports, considering the period he worked at the centre it is probable that those incidents occurred before the injury was sustained by Mr McMullen. Strong v Woolworths Limited (2012) 246 CLR 182; [2012] HCA 5, applied. (ii) Was the risk posed by the locking bar not insignificant? The appellant submitted that the risk was insignificant because it was obvious: [55]. It was the appellant's case at trial that there was no risk which was in tension with its argument on appeal that the risk was obvious: [56]. The risk was not obvious: [61]. Civil Liability Act 2002 (NSW) s 5B(1)(b), applied. South Sydney Junior Rugby League Club Ltd v Gazis [2016] NSWCA 8; Rail Corporation New South Wales v Donald; Staff Innovations Pty Ltd t/as Bamford Family Trust [2018] NSWCA 82; Bruce v Apex Software Pty Ltd t/as Lark Ellen Aged Care [2018] NSWCA 330, distinguished. (iii) Was the appellant in breach of its duty of care in failing to take reasonable precautions against the risk posed by the locking bar? The appellant's duty of care owed to Mr McMullen was not lessened by the fact it had taken over management of the shopping centre on 1 January 2007, some three week prior to the incident: [68]. Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479; [1987] HCA 7; Roads and Traffic Authority (NSW) v Dederer (2007) 234 CLR 330; [2007] HCA 42, referred to. The appellant submitted that the installing of a mechanism to stop the locking bar falling was but one way the risk could have been overcome: [72]. If the appellant contended it could discharge its duty by taking steps it had an evidential burden to show it took those steps: [73]. Further, the alternative proposed would be unlikely to have prevented the bar from falling if the lower part of the bar were inadvertently knocked; the risk would have remained live: [74], [75]. Currie v Dempsey (1967) 69 SR (NSW) 116; Australian Winch & Haulage Co Pty Ltd v Collins [2013] NSWCA 327, applied. (iv) Was the respondent in breach of its duty of care to Mr McMullen as his employer? There was no evidence that Mr Collis, an employee of the respondent, knew about the locking bar's having previously fallen and the danger it presented. No knowledge of the risk could be imputed to the respondent: [80]. (v) Mr McMullen was not contributorily negligent when he descended the ladder and knocked the locking bar. Mr McMullen was fully kitted out with breathing apparatus, helmet and sledge axe or Halligan tool: [14], [86]. His accidentally knocking the locking bar was accidental inadvertence not amounting to contributory negligence: [85], [86]. Podrebersek v Australian Iron and Steel Pty Ltd [1985] HCA 34; (1985) 59 ALJR 492, referred to.

Judgment

1. MACFARLAN JA: I agree with White JA.
2. WHITE JA: This is an appeal from orders of the District Court (Scotting DCJ) made under s 151Z(1)(d) of the Workers Compensation Act 1987 (NSW) requiring the appellant to indemnify the respondent for workers' compensation payments made by the respondent to an employee, a Mr Mark McMullen in respect of an injury suffered by him in the course of his employment on 22 January 2007 at the Metro Plaza Shopping Centre in Orange.
3. Mr McMullen was a member of the Fire Brigade and an employee of the respondent, the State of New South Wales (Fire Brigades Act 1989 (NSW), s 69(2)). He attended the shopping centre in response to a fire alarm.
4. The respondent was the plaintiff in the court below. It joined two defendants. The first defendant was Charter Hall Retail Management Limited. It was the responsible entity of a trust whose assets included the Metro Plaza Shopping Centre and it conceded that it was the owner of the shopping centre. The plaintiff's claim for indemnity against the first defendant failed and there is no cross-appeal. It took no part in the appeal.
5. The appellant was the second defendant in the court below. It was one of two joint managers of the shopping centre at the time of the plaintiff's injury. The other joint manager has been deregistered. The primary judge found that the appellant was the occupier of the shopping centre (Judgment [134]). There is no appeal from that finding.
6. Mr McMullen was injured when he attended the shopping centre in response to the fire alarm. The fire panel indicated that the alarm was triggered from an air-conditioning unit on the roof of the shopping centre. Access to the roof was obtained through a roof access door. A security guard accompanied Mr McMullen and the other fire-fighter to the roof access door. The access door was at the top of a ladder. The ladder was variously estimated to be about eight feet, nine to ten feet, or 12 feet high (Judgment [19]). It had a metal locking bar in front of it described in more detail below. The bar was raised and the door opened to permit Mr McMullen and his co-worker to reach the roof to check the air-conditioning unit. Mr McMullen was satisfied that there was no fire in the air-conditioning unit and that it was a false alarm. When leaving the roof the other fire-fighter descended the ladder first. Mr McMullen followed. The primary judge described the circumstances of the injury as follows (at [22]): "Before descending, Mr McMullen faced the ladder, put his foot on the top rung and held onto both sides of the ladder. On his way down Mr McMullen felt himself knock the locking bar with his elbow and then something hit his neck. He stopped where he was and felt pain in his neck. He realised that he had been struck by the locking bar. He took hold of the locking bar, pushed it back up into place and continued down the ladder. Mr McMullen described the pain as 'pretty severe' and gave evidence that he had never felt pain in his neck like that before."
7. The primary judge found that the appellant breached the duty of care it owed to Mr McMullen. He assessed the damages to which Mr McMullen would have been entitled had he sued the appellant to be $984,268. He rejected the appellant's claim that the respondent as Mr McMullen's employer was guilty of negligence and rejected its claim that Mr McMullen was contributorily negligent. The amount of notional damages assessed by the primary judge was well in excess of the workers' compensation payments made in the six years prior to the commencement of proceedings. Accordingly, the primary judge found that the respondent was entitled to be indemnified in respect of all of the workers' compensation payments for which it claimed indemnity, being payments made for the period between 22 December 2011 and 29 November 2018, with interest. Judgment was entered for the respondent in the sum of $325,599.36.
8. In finding that the appellant breached the duty of care it owed to Mr McMullen the primary judge found that the appellant, through one of its employees, a Ms Chapman, had actual knowledge of the risk of injury posed by the absence of any restraint to prevent the locking bar from falling onto a person using the ladder to access the door to the roof of the shopping centre. That was because a Mr Willox, who was employed by a third party to act as a security guard for the shopping centre and had performed that task for some 15 years, had reported to Ms Chapman on two occasions that the locking bar had fallen on him (Judgment [144]). The primary judge found that the risk involved a risk of death or serious injury and it was possible that the locking bar could fall onto a person using the ladder resulting in a fall of 12 feet to the floor at the bottom of the ladder (Judgment [146]). It was reasonably foreseeable that the locking bar could be disturbed by someone dislodging it from its resting place with a body part or an item of clothing (Judgment [146]). Simple and inexpensive precautions were available to avoid the risk of harm. The primary judge said (at [147]): "A mechanism to secure the locking bar when it was leaned against the door jamb could have been obtained from a hardware store and installed by a tradesman in less than 30 minutes. A sign warning of the risk and advising that the locking bar should be held whilst descending the ladder could have been affixed in the area of the ladder at minimal cost."
9. The primary judge said that if he were wrong in his conclusion that the respondent did not breach the duty of care it owed to Mr McMullen as his employer, then he would apportion 10 per cent responsibility for the incident to the respondent. He did not give reasons for that apportionment which, on his Honour's primary finding, did not arise.
10. The primary judge said that if he were wrong in his conclusion that Mr McMullen was not guilty of contributory negligence, he would assess contributory negligence as 10 per cent. He did not give reasons for that apportionment which, on his Honour's primary finding, did not arise.
11. The grounds of appeal were as follows: "1. The primary judge erred in determining that the appellant had actual knowledge risk of the risk harm. (s5B(1)(a) Civil Liability Act 2002). 2. The primary judge erred in failing to determine whether the risk of the risk of harm was not insignificant. (s5B(1)(b) Civil Liability Act 2002). 3. The primary judge erred in finding that the appellant breached any relevant duty of care in failing to take reasonable precautions. (s5B(1)(c) and s5B(2) Civil Liability Act 2002). 4. The primary judge erred in his finding that a reasonable person in the position of the appellant would have taken the precaution of getting a "mechanism" from a "hardware store" and have it installed by a tradesman. 5. The primary judge erred in finding that the respondent had not breached its duty of care to its employee, McMullen. 6. The primary judge erred in assessing (in the alternative) that the respondent's contribution on liability as only 10 per cent, and erred in failing to give any reasons for doing so. 7. The primary judge erred in finding that McMullen was not guilty of contributory negligence. 8. The primary judge erred in assessing (in the alternative) that McMullen's contributory negligence as only 10 per cent, and erred in failing to give any reasons for doing so."

How the injury occurred

1. The injury occurred on 22 January 2007. The respondent's application under s 151Z of the Workers Compensation Act 1987 (NSW) for indemnity for workers' compensation payments it had made was not filed until 22 September 2017. In about 2013 there were major renovations to the shopping centre. The shopping centre consisted of three floors with a top food court. It was removed and part of the food court went to another level. The renovations took approximately 12 months. Understandably, no photographs were tendered showing the physical layout of the ladder, door and locking bar. Less understandably, no drawing was tendered to assist an understanding of the witnesses' description of the site.
2. Mr McMullen and four or five other firemen, including a Mr Paul Collis, the then-station officer were despatched to the shopping centre. When they arrived, they followed the standard practice of going to the fire panel accompanied by a security guard. The fire panel showed that the alarm was at one of the air-conditioning units located on the roof of the centre.
3. Mr McMullen gave evidence that the standard practice after inspecting the fire panel is for the driver of the fire truck to stay back while the remainder of the crew go to assess the site of the alarm wearing a breathing apparatus. Mr McMullen's breathing apparatus consisted of a back plate with an air cylinder and an attached breathing mask, harnessed by a strap over the shoulders. Mr McMullen said he was also wearing a helmet, and would likely have been carrying a sledge axe or a Halligan tool (which he described as an "opening" tool used to jam doors open and break windows).
4. The crew were escorted by the security guard (whose name was unknown to Mr McMullen) to the roof access site, which was in a locked room away from the public. Mr McMullen said that to access the roof one had to ascend up an approximately 8 foot high steel ladder which was attached to the wall.
5. At the top of the ladder there was an access door that led to the roof. The door was a conventional vertical door mounted on hinges that opened in the outward direction. There was no ledge suitable for standing on inside from which the door could be opened. Instead, one would open the door whilst still standing a few rungs down on the ladder, then climb up, and while bending over, go through the door.

The metal locking bar

1. The door was obstructed from the inside by a locking bar which had to be lifted to allow the door to open. Mr McMullen described the locking bar in the following terms: "Q. What did the locking bar look like? A. The locking bar was about an inch thick metal bar. It was hinged on one side and then raised and lent against the, the wall when opened."
2. The bar was about a metre long. It was four-sided rather than round and it was hollow inside.
3. The bar was attached on its left side to the wall in which the access door was located by a hinge. It could be lifted up and then rested at a slight angle in a near-vertical position (i.e. more than ninety degrees anticlockwise from its horizontal locked position) against a left-hand wall that formed a corner with the wall with the access door. According to Mr McMullen, the hinge was about 1 inch (or 2.5 centimetres) from the wall. The bar, according to Mr McMullen, balanced on the hinge when it was in this position.
4. Connected to the door were two hooks forming a cradle in which the bar would sit in its locked position. If one were to pull the door from the outside, the bar would prevent the door from opening outward because it was secured in the cradle attached to the door and fastened to the wall by the hinge. The bar was then additionally secured from the inside by a padlock.
5. Mr David Willox, a supervisor of security and cleaning staff, had worked at the centre for about 15 years under two employers. He said that he had worked as an employee of Reflections Group, the latter of the two employers, in the shopping centre from 1998 to late 2007 or early 2008.
6. Mr Willox and one of his other staff had a key that would open the padlock. He said that he would access that rooftop via the ladder frequently, at least once a week.
7. Mr Willox gave evidence that when the door was open, it had to be latched to the external wall by a metal hook. He said this was because there was a tendency for the wind to blow the door shut. He described a "couple of occasions" where he did not latch the door in this fashion, and where it blew shut. On these occasions, the force of the door slamming shut would cause the metal locking bar to drop down into the horizontal position into the cradle.

The injury

1. Mr McMullen said that the security guard was the first to ascend the ladder. When the security guard reached the top of the ladder, he unlocked and lifted the metal bar, rested it against the wall, opened the door, and stepped out onto the rooftop. Mr McMullen said that at this point he was accompanied by only one other fireman.
2. Mr McMullen's ascent up the ladder to the rood was uneventful. Once there, he satisfied himself that the alarm was a false alarm. He radioed down to the station officer back at the fire panel and waited for the alarm to reset. He said that the three of them then decided to come back down.
3. It was on Mr McMullen's descent down the ladder that he suffered the injury. He descended the ladder second, after the other fire-fighter. The security guard stayed on the roof so he could shut the door.
4. Mr McMullen said that he went through the door backwards. He knew this to be the only and safest way of descend a ladder by reason of his training. He put his foot on the top rung and grabbed the sides of the ladder with his hands. As he was stepping down, his left elbow knocked the bar from its resting position and it hit the back of his neck.
5. Mr McMullen said that he grabbed the bar and pushed it back into its resting position, and continued to descend down the ladder.
6. He described the pain in his neck as "pretty severe", and said that he reported the injury to Mr Collis, the station officer.
7. Mr McMullen said that part of his training involved the undertaking of risk assessments Mr McMullen said that he performed such a risk assessment, but did not deem ascending up the ladder as particularly risky before his ascent because he had seen the security guard climb it.

The appellant's knowledge of the risk of harm

1. Mr Willox said that part of his duties as a supervisor required him to report to centre management. The reports were oral and he would "let them know if anything's out of the ordinary or what has occurred". He would make these reports "most days". The types of things he would report included maintenance issues, customer misbehaviour and evictions, breakages, broken escalators and the like.
2. Mr Willox said that he would make these reports to the "girl in the front office … at the front desk". On any given day, that could be either Sharon Connellan, "Jasmine", or Nicole Chapman. As far as he observed, when he made such a report, whoever was at the front desk would make a notation on a book that was lying on the desk.
3. To the best of Mr Willox's knowledge, Ms Chapman was the supervisor in charge of the girls at the front desk. He was of this view because he knew that Ms Chapman had her own office and he had previously observed that "most girls all went and reported to her".
4. As mentioned, Mr Willox gave evidence that if the access door to the roof was not latched when it was open (as it would inevitably need to be in order for it to be closed) it was possible for the wind to blow the door shut and dislodge the metal locking bar, causing it to fall. Mr Willox said that this happened to him on two occasions. On the first occasion he was standing on the ladder and he managed to "see it coming", that is, he saw that the door was being blown shut and that the locking bar was going to fall and he was able to catch the locking bar before it hit him.
5. Mr Willox's evidence was that after this incident, he went down and "let centre management know or the girl at the front desk [know]" of the near-incident, although he could not recall with whom exactly he spoke. He said that no action was taken as a consequence of his report.
6. One to two weeks later, a similar incident occurred. Mr Willox didn't know what caused the bar to drop down, but said that it might have been simply caused by his stepping through the door onto the ladder. Again, he managed to grab hold of the bar and lift it up to its unlocked position.
7. Mr Willox made an entry in an incident or security book maintained by Reflections Group about the bar falling. He also mentioned the incident to the girl at the front desk of the centre management office. He did not remember who the girl at the front desk was but did recall that Ms Chapman was present when he raised the issue. Mr Willox said that he did not speak directly to Ms Chapman about the incident but that she "would have heard the conversation" because she was standing a "couple feet" behind and to the side of the girl at the front desk. Mr Willox observed the girl at the front desk writing something down as a response to his report.
8. When asked whether the two occasions had any impact on the way in which he went down the ladder, Mr Willox said that he was always mindful to hold the door while he was going down to make sure it didn't shut with too much force. He said he was aware from his own experience that the bar had a propensity to fall and said that because of it he kept a closer eye on the bar as he was coming back inside from the roof.
9. Finally, Mr Willox described situations where he had made a report about a loose tile in the centre. He said he observed that the issue would be attended to, but that it would take some time. He also said that he observed people from centre management routinely inspect the centre once every week or two, but he never saw any such person inspect the accessway to the roof.
10. Mr Willox's evidence was not challenged.
11. Mr Willox could not remember when he made his reports. He worked as a security guard at the Metro Plaza Shopping Centre for approximately 15 years leaving in late 2007 or early 2008. Mr Willox said that he would have reported to Ms Chapman for at least six years before he finished his work as a security guard there.
12. It follows that the two incidents he reported which occurred within weeks of each other, and to which at least the second Ms Chapman was privy, could have occurred between 2001 (or possibly earlier) and early 2008.
13. Mr Willox was not able to say when within this timeframe the reports were made. He was giving evidence 10 years after he had ceased employment as a security guard at the Centre. It is possible that the incidents he reported occurred after the date of Mr McMullen's injury (22 January 2007). But it is probable that those incidents occurred before 22 January 2007 (Strong v Woolworths Limited (2012) 246 CLR 182; [2012] HCA 5 at [34]).
14. The management agreement pursuant to which the appellant assumed responsibility for the management of the Centre had a commencement date of 1 January 2007 and a termination date of 31 January 2007. As noted above there were two managers, namely the appellant (then called Macquarie Real Estate Management Services (NSW) Pty Ltd) and Macquarie Real Estate Management Services Pty Ltd. They were jointly named as Manager. The principal was Macquarie Asset Services Ltd. The appellant (and the first defendant in the court below) adduced no evidence to explain why the management agreement was entered into only for a term of one month. (The common seals of the parties to the agreement were not affixed until July). The management agreement required the manager to perform Services, including Property Management Services, in respect of all properties held by the custodian (Perpetual Limited or Macquarie CountryWide Management Limited) on behalf of the Macquarie CountryWide Trust. "Property Management Services" included the efficient on-site management of the Centre and regularly inspecting the Centre to ensure that required standard of repairs and operations were being maintained. The manager undertook to the principal that it would perform the Services in respect of the Centre in accordance with all Laws and Standards including the laws of New South Wales and the common law.
15. As noted above, the primary judge found and the appellant did not dispute that the appellant assumed the obligations of an occupier for the safety of entrants to the Centre, including Mr McMullen.
16. There is no evidence that the appellant assumed management of the Centre prior to 1 January 2007. It is not disputed that Ms Chapman who had previously worked for the Centre's manager was employed by the appellant at the time of Mr McMullen's injury. How long she had been employed by the appellant was not revealed in the evidence. But it was common ground that she was employed by the appellant at the date of Mr McMullen's injury. If her knowledge of the reports made by Mr Willox can be imputed to the appellant, then the primary judge's finding that on the balance of probabilities the appellant had actual knowledge of the risk that the locking bar could fall on a person descending the ladder is unassailable. Ultimately, counsel for the appellant accepted that if Ms Chapman had knowledge of Mr Willox's report which she acquired in a former employment, that knowledge is imputed to the appellant that assumed the role of managing the Centre and employed Ms Chapman to perform the same job as she had performed for the previous manager, owner or occupier of the Centre.
17. In my view that concession was correctly made. The respondent submitted: "The challenge to whether the knowledge of Ms Chapman was actual knowledge of the Appellant was an inference reasonably open to the Trial Judge on the unchallenged evidence of Mr Willox regarding his reporting of experiences with the locking bar previously. It would have been a simple matter for the Appellant to call Ms Chapman to give contrary evidence. Not only was she an employee, but she was a supervisor. Being in a position of management, meant that the corporate knowledge of the Appellant included that which had been communicated to her. [Optus Administration Pty Ltd v Glen Wright by his tutor James Stuart Wright [2017] NSWCA 21 at [49] and [52]; Nationwide New[s] Pty Ltd v Naidu & Anor; ISS Security Limited v Naidu & Anor [2007] NSWCA 377 at [40]-[41].] Corporate knowledge includes knowledge of former officers and employees and continues to exist even in the face of death of a former company officer. [Tszyu v Fight Vision Pty Ltd & Anor; Fight Vision Pty Ltd v Onisforou & Ors [1999] NSWCA 323 at [244]] Likewise, knowledge acquired by Ms Chapman when she was employed by some other entity before the Appellant took over the management agreement must, by extension, become knowledge of the Appellant once they employed Ms Chapman. Again, one would expect and anticipate the Appellant to call evidence from Ms Chapman if reasonable inferences from Mr Willox's evidence were contrary to the fact."
18. I agree with this submission.
19. Irrespective of the appellant's actual knowledge of the prior incidents involving Mr Willox, it ought to have known that the condition of the ladder, access door and locking bar was dangerous. The effect of Mr Willox's unchallenged evidence was that once the access door to the roof was opened, it was latched to prevent its being blown shut. But the door had to be unlatched before the last person on the roof could descend the ladder which had an eight to 12 foot drop. If the person descending the ladder, after unlatching the door, used both hands to grasp the ladder before descending it, a gust of wind could blow the door shut causing the locking bar in its near vertical position to be dislodged. Otherwise the last person descending had to use one hand to prevent the door from blowing shut and was at risk of bumping the lower part of the bar that obtruded past the vertical. Bumping that part of the bar could cause the bar to fall on the person moving through the door onto the ladder.
20. The first ground of appeal was that the primary judge erred in deciding that the appellant had actual knowledge of the risk of harm. That submission should not be accepted for the reasons above.
21. The appellant observed that the respondent did not call Ms Chapman to give evidence. Prima facie, as Ms Chapman had been the appellant's employee at the time of the injury, it is the appellant who would be expected to have called her. It may be that having regard to the passage of time and the changes to the shopping centre that took place at least prior to 7 March 2014 that Ms Chapman was in neither party's camp. On any view, no Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 inference arises against the respondent for not calling Ms Chapman to give evidence.
22. The second ground of appeal is that the primary judge did not determine whether the risk of harm was not insignificant and erred in failing to do so (Civil Liability Act 2002, s 5B(1)(b)).
23. The primary judge did determine that the risk of harm was not insignificant. He found that the risk involved a risk of death or serious injury (Judgment [146]). That finding was correct. This ground should also be rejected.
24. The appellant submitted that the primary judge ought to have found that the risk of injury was insignificant because: "... the obviousness of that risk and remoteness of the likelihood that people using the area would fail to observe and take account of the door lock as Willox had."
25. The appellant submitted that the risk was insignificant because it was obvious to someone keeping a reasonable lookout for his own safety. Counsel for the appellant submitted that the obviousness of the risk is relevant to the assessment of the significance of the risk (South Sydney Junior Rugby League Club Ltd v Gazis [2016] NSWCA 8 at [89]), approved in Rail Corporation New South Wales v Donald; Staff Innovations Pty Ltd t/as Bamford Family Trust [2018] NSWCA 82 at [140] and applied in Bruce v Apex Software Pty Ltd t/as Lark Ellen Aged Care [2018] NSWCA 330 at [26]-[27]).
26. There was an obvious tension between the appellant's submission that the risk of injury from the locking bar falling onto a person using the ladder was insignificant because it was obvious (so that no steps needed to be taken to avoid the risk) and its submission that it did not know and ought not to have known of the risk.
27. The circumstances of the present case are far removed from the facts in South Sydney Junior Rugby League Club Ltd v Gazis or Rail Corporation New South Wales v Donald or Bruce v Apex Software Pty Ltd.
28. In South Sydney Junior Rugby League Club Ltd v Gazis Basten JA (with whom Macfarlan and Simpson JJA agreed) said (at [89]): "The requirement that a foreseeable risk be 'not insignificant', for the purposes of s 5B(1)(b), engages a different set of considerations, although not at the same level of generality as would suffice for a finding of a foreseeable risk. The significance of a risk will depend upon a variety of factors, including obviousness, likelihood of occurrence and seriousness of consequences. In the present circumstances (apart from the chance of the wheels being locked) the risk that a person would fall over if a force, either insufficient (as the plaintiff thought) or too great were applied, or if the person were careless in his or her grip, was foreseeable, but quite unlikely to eventuate. In my view, such a risk could be dismissed as insignificant or, which may be the other side of the same coin, not a risk which would cause a reasonable person in the position of a Club supervisor to direct the plaintiff not to move the trolley. It was possible that a supervisor would direct the plaintiff not to move the trolley because it was seen to be inconsistent with attention to his duties as an armed guard, but that is another matter; failure to give a direction for that reason would not constitute a breach of the duty of care owed to the plaintiff."
29. The obviousness of the risk was not in issue in South Sydney Junior Rugby League Club Ltd v Gazis nor in Rail Corporation New South Wales v Donald.
30. In Bruce v Apex Software Pty Ltd Meagher JA (with whose reasons Leeming JA and I agreed) said (at [27]): "27 The question remains whether, as Mrs Bruce contends, the primary judge should have held that the risk of harm was 'not insignificant'. In my view the evidence before the primary judge supported the conclusion that the risk of someone tripping and falling was 'insignificant' because of the obviousness of that risk and remoteness of the likelihood that people using the area would fail to observe and take account of the uneven surface: Thompson v Woolworths at [36]. The use of the brick pavers as borders to the concrete slabs was readily apparent, both from the different surface materials and their colouring. The fact of a difference in the levels of the two surfaces was also obvious to anyone giving some attention to the surface on which they were walking. Whilst the extent of the difference in levels at any point may have been difficult to determine, the fact of the difference remained obvious and recognisable as something which ordinary life experience and common sense showed must be avoided or accommodated. The evidence as to the absence of any reported falls, or other complaints, for the period of at least 15 years (see [4] to [8] above) is wholly consistent with an assessment of the risk of tripping as being insignificant; as was the fact that Mrs Bruce herself had walked across the area 'for the nine months prior to the accident including up to about 100 times without any difficulty' (Judgment 240)."
31. This was far removed from the facts confronting Mr McMullen. It was not suggested to Mr McMullen that the risk of injury was obvious. To the contrary, the appellant's case at trial was that there was no risk. In cross-examination Mr McMullen gave the following evidence: "Q. On this particular day, you had to climb a ladder that was, I think, 8 foot high? A. Yes. Q. Do I take it that what you're saying is before you did that, you mentally perform a risk assessment as to whether that's something you could or should do? A. Yeah, so part of that would be, it's a ladder, I have to have three points on the ladder at all times, so that would be going through my head, part of our training that we do when we deal with the ladders. Q. And part of it you're assessing the door and where the door is and whether there are any risks associated with the premises to you in getting up onto the roof? A. Yeah, and at that stage I didn't deem it a risk because the security guard had already gone through. Q. So, is it the case that the security guard had climbed the ladder first? A. Mm-hmm. Q. And he had unlocked the locking bar? A. Yes. Q. And lifted it up and leaned it against the wall? A. Yes. Q. And he had gone through? A. Yes. Q. And you obviously could see all of that? A. Yes. Q. And you didn't assess any risk in it to you as a firefighter? A. No, I didn't deem it as a risk at that stage, no. Q. And then if we were to assume the next senior firefighter was the next person up after the security guard. I take it you saw him get up onto the roof? A. Yes. Q. Without problem? A. If that's the case, yes. Q. And you then, obviously that reinforced your original assessment that you could do it then without risk? A. Yes. Q. Do I take it that essentially mentally you're doing exactly the same thing as you come down? A. Yeah, pretty much so. Q. You're looking at particular things to see whether they constitute risks to you and if they do, you take some action about them? A. Yes. Q. On this day, there was nothing, in terms of getting up onto the roof and getting back down, that you perceived as a particular risk that you needed to deal with? A. No."
32. The third ground of appeal was that the primary judge erred in finding that the appellant breached "any relevant duty of care" by failing to take reasonable precautions. Ground 4 elaborated on that ground by asserting that the primary judge erred in finding that a reasonable person in the position of the appellant would have taken the precaution of getting a "mechanism" from a "hardware store" and have that mechanism installed by a tradesman.
33. The reference in ground 3 to "any relevant duty of care" is misplaced. As noted above, the appellant did not challenge the primary judge's finding that the appellant owed Mr McMullen the duty of care of an occupier. The appellant owed a duty to take reasonable care to avoid risk of injury to entrants. The extent of that obligation would take into account the exercise of reasonable care by the entrant (Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479; [1987] HCA 7; Roads and Traffic Authority (NSW) v Dederer (2007) 234 CLR 330; [2007] HCA 42 at [47] per Gummow J).
34. Sections 5B and 5C of the Civil Liability Act provide: "5B General principles (1) A person is not negligent in failing to take precautions against a risk of harm unless: (a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and (b) the risk was not insignificant, and (c) in the circumstances, a reasonable person in the person's position would have taken those precautions. (2) In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things): (a) the probability that the harm would occur if care were not taken, (b) the likely seriousness of the harm, (c) the burden of taking precautions to avoid the risk of harm, (d) the social utility of the activity that creates the risk of harm. 5C Other principles In proceedings relating to liability for negligence: (a) the burden of taking precautions to avoid a risk of harm includes the burden of taking precautions to avoid similar risks of harm for which the person may be responsible, and (b) the fact that a risk of harm could have been avoided by doing something in a different way does not of itself give rise to or affect liability for the way in which the thing was done, and (c) the subsequent taking of action that would (had the action been taken earlier) have avoided a risk of harm does not of itself give rise to or affect liability in respect of the risk and does not of itself constitute an admission of liability in connection with the risk."
35. The appellant relied upon a statement made by Mr Paul Collis. Mr Collis was the Station Officer based at Orange at the time of Mr McMullen's injury. He attended the call on 22 January 2007 along with Mr McMullen and one other Fire Brigade officer (who was not identified). He did not witness the incident because at the time of the injury he was in the fire control room in a separate area of the Centre. In his statement Mr Collis said: "9. I do not have a good working knowledge of the area in which Mark was injured. However, I have been into the area, and note that it really is a single person access, and in my recollection, opening/securing and closing the hatch should be a one person job. ... 11. While I cannot speak for Mark, I had previously been to that location, as had other fire-fighters. I note that in my earlier visits to the location, there was nothing obvious that the locking bar presented a danger to the personnel relying on it."
36. Mr Collis' statement was tendered by the appellant. The respondent did not require him for cross-examination. The appellant submitted that as the risk of harm was not apparent to Mr Collis it should be found that it was not foreseeable to it.
37. But there is no evidence that Mr Collis was aware of any prior incidents of the locking bar having fallen on a person exiting from the roof. There is no evidence that he knew that the locking bar could be so insecure that it could fall from vibration caused by the door being blown shut. These were matters known to the appellant through Ms Chapman.
38. The appellant stressed that it had only assumed the obligations of manager on 1 January 2007, only three weeks before the injury. But by clause 24 of the management agreement, it agreed with the principal that it would ensure compliance with Occupational Health and Safety laws. Section 10 of the Occupation Health and Safety Act 2000 (NSW) as in force on 22 January 2007 required that a person who had control of premises used by people as a place of work must ensure that the premises were safe and without risk to health. Officers of a fire brigade were called to the premises as a place of work. The appellant had an obligation when taking up its responsibility as manager to carry out due diligence to ensure that it could comply with its contractual obligations to the Principal. The contractual obligation owed by the appellant to its principal can inform its duty of care to Mr McMullen (Argo Managing Agency Ltd v Al Kammessy [2018] NSWCA 176 at [100]-[101] (Sackville AJA)).
39. The appellant submitted that the primary judge erred in finding that a reasonable person in the appellant's position would have taken precautions to have avoided the risk of harm by installing the "mechanism" that could be obtained from a hardware store and providing a warning sign (Judgment [147]).
40. As noted above, a simple and inexpensive precaution was to provide a "mechanism" to secure the locking bar when it was leaned against the door jamb. The appellant described this finding as a requirement for a "catch". Given that the locking bar must have had a puncture through it to allow the padlock to be threaded through, the type of mechanism that could be used needed to be no more than a hook, similar to the type used to keep the door from blowing closed. The hook could have been affixed to the wall where the locking bar rested.
41. The primary judge's finding that a "mechanism" to prevent the bar inadvertently falling could have been simply obtained was correct. Indeed, it was conceded at trial by the appellant that it was common sense that one way to stop a bar hinged at one end from falling is to have some form of locking device at the top.
42. The appellant submitted that an equally common sense suggestion would be to tighten the hinge. If that was what needed to be done, the appellant did not do it. In response to that proposition, counsel for the appellant submitted that the appellant had only assumed responsibility for management of the Centre on 1 January 2007 and it was not shown to have been negligent not to have checked the hinge to see if it needed tightening within the 21 days before Mr McMullen's injury. It was common ground that the Centre was a very large shopping centre.
43. The respondent did not allege that the appellant breached its duty of care by not tightening the hinge. Whether the appellant did tighten the hinge, and if so, whether that was an adequate response to the risk of harm, would only be relevant if the appellant had asserted and sought to prove that it was not negligent because although it did not take the steps the respondent alleged it should have taken to discharge its duty of care, it took other steps that discharged that duty. The evidential burden would have rested with the appellant (Currie v Dempsey (1967) 69 SR (NSW) 116 at 125; Australian Winch & Haulage Co Pty Ltd v Collins [2013] NSWCA 327 at [78]-[79]). The appellant did not attempt such proof.
44. In any event, I doubt that tightening the hinge would have discharged the appellant's duty of care. Tightening the hinge might have prevented the locking bar from falling if the door were blown shut, but it would be unlikely to have prevented the bar from falling if the lower part of the bar were inadvertently knocked. Mr Willox's reports of the danger of the bar falling were not the result of his bumping the lower extremity of the bar where it sat outside the vertical, but they should have alerted the appellant to both the reasonably foreseeable risk of the bar's falling from the door's blowing shut and the risk from its being bumped. I doubt that tightening the hinge would have been an adequate response to the risk. In any event, there was no evidence that that step was taken.
45. For these reasons the primary judge's conclusion that the appellant breached the duty of care it owed Mr McMullen was correct. Grounds 3 and 4 should be rejected.
46. The fifth ground of appeal was that the primary judge erred in failing to find that the respondent breached the duty of care it owed to Mr McMullen as his employer.
47. The appellant submitted that it was clear from Mr Collis' evidence that he had visited the area in question, was familiar with the locking bar and, to him, it presented no danger. The appellant submitted that if, as the primary judge found, the appellant should have gone to a hardware store to purchase a form of locking mechanism, then the respondent as Mr McMullen's employer, having seen and assessed the locking bar prior to the incident, was on notice of that particular danger, but did nothing to protect Mr McMullen.
48. Mr Collis was a witness available to either party. Prima facie as the respondent's employee, the respondent could be expected to have called him to rebut a contention that he negligently exposed Mr McMullen to a risk of injury.
49. But that was not the basis upon which the appellant relied upon Mr Collis' evidence at trial. The appellant rather tendered his statement to seek to rebut the claim that the appellant was negligent.
50. Mr Collis was not with Mr McMullen when Mr McMullen ascended and then descended the ladder. He was in the fire control room in a separate part of the Centre. He had not previously noted anything obvious about the locking bar that presented a danger to persons using the ladder. But there is no evidence that he had any information about the locking bar having previously fallen and presented such a danger.
51. Mr McMullen knocked the locking bar with his elbow which then fell onto his neck. This is consistent with his hitting the lower part of the locking bar where it was past the vertical in the direction of the ladder.
52. Mr Collis could have seen this on his prior inspection. But it does not follow that in the circumstances in which he and Mr McMullen attended the call that he ought to have given Mr McMullen any warning. There was no evidence as to when Mr Collis had inspected the particular location. The call had to be attended to. The appellant did not articulate precisely what Mr Collis should have done to discharge the respondent's duty of care to Mr McMullen. Although Mr Collis was the respondent's employee, the allegation that the respondent breached its duty to Mr McMullen depended upon the appellant's establishing that Mr Collis failed to do something which he ought to have done. It did not call Mr Collis. Nor, in its defence, did it specify with particularity what Mr Collis ought to have done to provide a safe system of work. Its particulars of the respondent's breach of its duty of care as Mr McMullen's employer were at a high level of generality that did not require the respondent to call Mr Collis.
53. The finding that the respondent did not breach its duty of care to Mr McMullen was correct. Grounds 5 and 6 should be rejected.
54. The appellant submitted that Mr McMullen was fully aware of the locking bar. He said he had undertaken a risk assessment on both the way up and the way down and that the locking bar fell only because he knocked it with his elbow. The appellant submitted that contributory negligence should have been assessed at 20 per cent.
55. It was not put to Mr McMullen in cross-examination that he was careless in knocking the bar when descending the ladder.
56. Mr McMullen was fully kitted out with breathing apparatus, helmet and sledge axe or Halligan tool as described at [14] above. His accidentally knocking the locking bar (presumably at its lower point where it obtruded beyond the vertical towards the ladder) was accidental inadvertence not amounting to contributory negligence (Podrebersek v Australian Iron and Steel Pty Ltd [1985] HCA 34; (1985) 59 ALJR 492 at 493-4).
57. Grounds 7 and 8 should be rejected.

Conclusion

1. No submissions were made as to how, if at all, the judgment for indemnity would be affected if grounds 7 or 8, or both, succeeded, having regard to the size of the notional assessment of damages. As those grounds fail it is unnecessary to pursue this question.
2. For these reasons I would dismiss the appeal with costs.
3. SIMPSON AJA: I agree with White JA.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 25 February 2020