Day v The Ocean Beach Hotel Shellharbour Pty Ltd

[This headnote is not to be read as part of the judgment] The appellant was a patron at the respondent Hotel on the night of 4 July 2008. The manager on duty that night formed the view the appellant was intoxicated, and after speaking with the Hotel's licensee, instructed a security guard to remove her from the premises. He did so by pulling the stool on which the appellant was seated out from underneath her. The appellant fell to the floor and was injured. The primary judge found that the security guard had committed an assault and battery on the appellant for which his employer Checkmate was vicariously liable. However (because Checkmate had ceased to exist), the appellant sought to fix vicarious liability upon the Hotel or its licensee. She also challenged the assessment of damages (including aggravated and exemplary damages) ordered against Checkmate. Held (by the Court), dismissing the appeal:

1. None of the exceptions relied upon applied to make the Hotel or the licensee vicariously liable for the tort committed by the security guard: [14]-[19], [22] Hollis v Vabu Pty Ltd [2001] HCA 44; (2001) 207 CLR 21; Sweeney v Boylan Nominees Pty Ltd [2006] HCA 19; (2006) 226 CLR 161, applied. (a) The security guard was not expressly authorised to commit the assault and battery. The findings of the primary judge, that neither the Hotel's duty manager nor its licensee were on the spot when the incident occurred, and that all that was authorised was the appellant's removal, were amply open on the evidence: [16] (b) The security guard was not the Hotel's agent, properly so-called. He had no authority to bind the Hotel, and it was clear that he represented Checkmate, not the Hotel: [17]-[19] Sweeney v Boylan Nominees Pty Ltd [2006] HCA 19; (2006) 226 CLR 161; Colonial Mutual Life Assurance Society Ltd v The Producers and Citizens Co-operative Assurance Company of Australia Ltd (1931) 46 CLR 41, applied. (c) The licensee was not directly liable via s 91 of the Liquor Act 2007: [20]-[21] Starks v RSM Security Pty Ltd [2004] NSWCA 351; (2004) Aust Torts Reports 81-763, followed.
2. Obiter, authority precludes this Court from finding Australian law admits of a theory of dual vicarious liability whereby two different defendants can be liable for the tortious act of a third person: [23]-[33] Oceanic Crest Shipping Company v Pilbara Harbour Services Pty Ltd (1986) 160 CLR 626, applied. Viasystems (Tyneside) Ltd v Thermal Transfer (Northern) Ltd [2005] EWCA Civ 1151; [2006] QB 510; Various Claimants v The Catholic Child Welfare Society [2012] UKSC 56; [2012] 3 WLR 1319, not followed.
3. There was no appellable error in the assessment of damages, including aggravated and exemplary damages, to which a high level of appellate deference is accorded: [41]-[43].

Judgment 1MEAGHER JA: I agree with Leeming JA. 2EMMETT JA: This appeal arises out of an incident that occurred in licensed premises known as the Ocean Beach Hotel (the Hotel) at Shellharbour. The appellant, Ms Julia Day, was injured when a security guard pulled out from under her the stool on which she was sitting. Ms Day asserted that the occupier of the Hotel, the first respondent, and the licensee of the Hotel, the second respondent, were vicariously liable for the conduct of the security guard. 3A judge of the District Court rejected those contentions and entered a verdict for the occupier and licensee. However, his Honour held that the employer of the security guard was vicariously liable for the conduct of the security guard. His Honour ordered the employer of the security guard to pay general damages of $2,500, plus aggravated damages of $2,500 and exemplary damages of $5,000. Ms Day has now appealed to the Court of Appeal from the verdict in favour of the occupier and licensee, and also on the basis that the damages awarded were inadequate. 4I have had the advantage of reading in draft form the reasons of Leeming JA for dismissing the appeal and for concluding that, in any event, the damages were not inadequate. I agree with his Honour's reasons, based on maintaining the distinction between a true agent, on the one hand, and an independent contractor, on the other, for rejecting the contention that the occupier or the licensee was vicariously liable. The distinction between a contract for service and a contract for services is of considerable antiquity. The Romans drew a distinction between locatio operarum, which corresponds to a contract for service, and locatio operis, which corresponds to a contract for services. I also agree with Leeming JA's observations concerning the difficulty in holding two independent entities both vicariously liable for the tortious act of a third party. Finally, I agree with the reasons given by Leeming JA for his Honour's conclusion that there should be no interference with the assessment of damages made by the trial judge. The appeal should be dismissed with costs. 5LEEMING JA: This appeal is principally about liability, as to which there are no disputed facts. Late in the evening of Friday 4 July 2008, the appellant, Ms Julia Day, was drinking sparkling wine at licensed premises known as the Ocean Beach Hotel at Shellharbour occupied by the first respondent (the Hotel), whose licensee was Ms Karma Elliott-Cosmos, the second respondent. Ms Day's evidence was that she was "tipsy"; the Hotel's duty manager that night, Ms Hayley May, formed the view she was intoxicated. Ms May, after speaking with Ms Elliott-Cosmos, told Mr Matthew James, one of the security guards on duty, to "get rid of her". How he did so was recorded on closed circuit television. He spoke with her for some 39 seconds while she was seated on a stool at a table with other patrons. Mr James then went behind Ms Day and pulled the stool out from underneath her. She fell to the floor, and shortly afterwards left the premises. She claims that she was seriously injured by the fall. 6The primary judge found that Mr James committed an assault and battery upon Ms Day, for which his employer, Checkmate Security International Pty Ltd (Checkmate), was vicariously liable, his excess being "incidental" to his employment in the sense used by Latham CJ in Deatons Pty Ltd v Flew (1949) 79 CLR 370 at 378, by Basten JA in Zorom Enterprises Pty Ltd v Zabow [2007] NSWCA 106; (2007) 71 NSWLR 354 at [21] and by Ipp JA in Sprod bnf v Public Relations Oriented Security Pty Ltd [2007] NSWCA 319; (2007) Aust Torts Reports 81-921 at [79]-[83] (three appeals relating to vicarious liability for assaults in the vicinity of licensed premises). His Honour ordered general damages of $2500, plus aggravated damages of $2500, plus exemplary damages of $5000. 7Checkmate was purportedly joined as the third respondent to the appeal, although it was deregistered with effect from 31 October 2011 (which is to say, after the evidence in the trial had closed, but before addresses had completed). A deregistered company ceases to exist, and its property becomes vested either in the Commonwealth or in ASIC, depending on whether or not it is held on trust: Corporations Act 2001 (Cth), s 601AD. It seems that Checkmate's directors or shareholders applied for voluntary deregistration on 2 March 2011, pursuant to s 601AA. That provision is only available if, inter alia, the company is not a party to any legal proceedings: s 601AA(2)(f). Seemingly none of this was brought to the attention of the primary judge, save that his Honour recorded that "[c]oncerns are held for its viability" when it did not appear at the trial. Nor is it clear what ASIC was told of the pending proceedings when those controlling Checkmate applied to deregister it. However, it explains the focus of this appeal, which was to fix liability upon the Hotel or its licensee. To that end, the primary judge made a series of factual findings, none of which is challenged on appeal. 8First, neither Ms Elliott-Cosmos nor Ms May was there on the spot with Mr James when he confronted Ms Day. Secondly, although he was squarely authorised to remove her, there was no suggestion that Mr James was expressly or impliedly directed to take the course he did, which went beyond the "reasonable degree of force as may be necessary" authorised by statute (see below) and amounted to an assault and battery upon her. Thirdly, Mr James was employed by Checkmate, and Checkmate was an independent contractor retained by the Hotel for the supply of security services, pursuant to an oral contract. Fourthly, in light of what was said in Hollis v Vabu Pty Ltd [2001] HCA 44; (2001) 207 CLR 21 and Sweeney v Boylan Nominees Pty Ltd [2006] HCA 19; (2006) 226 CLR 161 about the nature of the relationship between tortfeasor and the person sought to be held vicariously liable, his Honour made the following findings (at [42]): "The uniforms of Mr James and the other security guards were different from the uniforms of hotel staff. The uniforms were provided by Checkmate who also provided two-way radios to its security guards. Security guards may or may not work at the Ocean Beach Hotel site. Checkmate Security sent enough guards to cover that particular job. The guards may be sent elsewhere. They may even be reallocated on the same night. The hotelier and staff had general control of security staff such as Mr James but that control was limited to where in the premises they should work and on what task, but in my opinion, not how to do the task. Mr James and other security staff could delegate any tasks which they were asked to do to another guard. Indeed that happened in this case initially when Mr James asked another guard to attend to the issue. There were supervisors and inspectors employed by the security company who were concerned with how the guards were going about their job. At every job, including at this hotel, one of the guards there was a supervisor and the hotel and the hotel staff would deal with that supervisor in any issues to do with the guards."

Legislative regime 9Ms Day's statement of claim and submissions gave prominence to s 91 of the Liquor Act 2007 (Act) which relevantly made the licensee Ms Elliott-Cosmos "responsible at all times for the personal supervision and management of the conduct of the business of the licensed premises under the licence". But in order to determine whether ultimately she or the Hotel is vicariously liable for the tort of Mr James, it is necessary to examine the whole of the relevant legislative and regulatory regime: the Act, the conditions of the hotel licence, and the Security Industry Act 1997. 10It is not lawful to sell liquor unless authorised by licence: s 7(1). One such licence is a "hotel licence": s 14(1), known until the commencement of the Act (three days before the incident) as a "hotelier's licence". On the commencement of the Act a "hotelier's licence" issued under former legislation was taken to be a hotel licence in force under the Act: Schedule 1, clauses 3 and 4. The business carried out under a hotel licence must be open to the public; it is not possible to restrict patrons to invitees or a particular class of persons: s 17(2). At least until 1 July 2008, premises to which a hotelier's licence relates were a "common inn": see Liquor Act 1982, s 100, with a duty to receive all travellers, no right to turn them out save as expressly authorised, and (formerly) an innkeeper's lien for any unpaid bills: see Ex parte Coulson; Re Jones (1948) 48 SR NSW 178 at 184-185 (Davidson J) and 198-201 (Herron J, where the history of the English, colonial and State legislation is traced), R v Rymer (1877) 2 QBD 136 and Sealey v Tandy [1902] 1 KB 296. It is not necessary to consider the consequences of the absence of a counterpart to s 100 in the Act. It is sufficient to note that the English rules governing common inns, which were transplanted to New South Wales, a remnant of which may be seen in s 17(2), provide a partial explanation for the positive grant of authority in s 77, on whose terms Ms Day relied: "77 Non-voluntary exclusion of persons from licensed premises (1) In this section: authorised person means a licensee, an employee or agent of a licensee or a police officer. employee includes, in the case of a registered club, a person engaged under a contract for services. ... (2) An authorised person may refuse to admit to, or may turn out of, licensed premises any person: (a) who is at the time intoxicated, violent, quarrelsome or disorderly, or (b) whose presence on the licensed premises renders the licensee liable to a penalty under this Act, or ... ... (5) For the purposes of this section, such reasonable degree of force as may be necessary may be used to turn a person out of licensed premises." 11The hotel licence, which had been granted in 1958, reflected conditions imposed at the time the hotel's trading hours were extended: "On Friday and Sunday a minimum of two (2) licensed uniformed security guards are to be employed at the premises from 8:00pm until the last patron has left the area. ... Notwithstanding the conditions above, a minimum of one (1) licensed, uniformed security guard be at each entry/exit point during the extended hours. That all employed security officers are to have completed an approved course in the Responsible Service of Alcohol. That employed security officers are to perform security duties only and are not to be employed or used for other duties." 12Those conditions reflect the terms of the legislative regime. A person must not carry on a security activity unless licensed: Security Industry Act, s 7(2). "Security activity" includes acting as a crowd controller and patrolling, protecting or guarding any property: s 4(1), and is apt to describe the security guards' role in the Ocean Beach Hotel. Both individual security guards and their employer are required to be licensed: see s 7(1) and s 4(1)(m). Security guards may only be licensed if they have certain competencies and experience, and have undertaken and completed the requisite training, assessment and instruction: s 15(1). The Security Industry Regulation 2007, in force at the time, provided for the making of guidelines for the character and design of uniforms, failure to comply with which was an offence: see reg 40. 13As was said in Zorom Enterprises at [37], the duties of security guards must take account of the general provisions of the Liquor Act and the particular conditions of the licence. Absent evidence to the contrary, the inference is available that the security personnel were contracted by the Hotel to ensure the licensee's compliance with both her statutory obligations under the Act and her specific obligations under the licence. So understood, the obligations of the security personnel would have included turning out persons thought to be intoxicated, and those involved in or likely to be involved in violent or quarrelsome conduct.

Vicarious liability 14"[V]icarious liability derived originally from mediaeval notions of headship of a household, including wives and servants; their status in law was absorbed into that of the master": Hollis at [33]; Sweeney at [20]. The "general rule" has long been that an employer is not liable for a tort committed by an independent contractor. The language of "general rule" is that of Jordan CJ in Torette House Pty Ltd v Berkman (1939) 39 SR (NSW) 156 at 165, of Mason J in Stoneman v Lyons (1975) 133 CLR 550 at 574, of Brennan J in Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 at 575 and of Gleeson CJ, Gaudron, Gummow, Kirby and Hayne JJ in Hollis at [32]. McHugh J has suggested a substantial reformulation of that general rule, so that it extends to the tortious acts of independent contractors who are "agents" carrying out tasks for the benefit, and as representatives, of their principals (in Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313 at 366-367, and in Hollis at [73]-[74], [93]), but that has never commanded the assent of a majority of the High Court (Sweeney at [27]) and its adoption is not a matter for this Court. Notwithstanding that parts of Ms Day's argument resembled McHugh J's proposed reformulation in those cases, until the High Court otherwise determines, the distinction between independent contractors and employees is a "basic proposition" and a "central conception" of the law relating to vicarious liability, which is "too deeply rooted to be pulled out": Sweeney at [12] and [33]. 15The nature of that "general rule" and "central conception" is reflected in three qualifications to it. First, the labels "employer" and "employee" and "principal" and "independent contractor" are merely that. The classification does not of itself determine the legal conclusion that there is or is not vicarious liability, or, as the joint judgment in Hollis put it at [36], those terms "do not necessarily display their legal content purely by virtue of their semantic meaning". To do so would be, to use Windeyer J's words in Brooks v Burns Philp Trustee Co Ltd (1969) 121 CLR 432 at 458, "to invert the order of inquiry" and to "allow linguistics to determine legal rights". The real question is whether the "fundamental concerns underlying the doctrine of vicarious liability", one of which is control, are established: Hollis at [45]. The second, which is a corollary of the first, is that a conclusion that a person is an "employee" or "independent contractor" for a particular purpose (such as payroll tax, or superannuation, or employment law) cannot determine whether the relationship is such as to engage the rules of vicarious liability (the different outcome in Vabu Pty Ltd v Federal Commissioner of Taxation (1996) 33 ATR 537 illustrates as much). The third is that there are exceptions to the "general rule", which reflect the fundamental concerns underlying the doctrine. One is where an independent contractor is expressly authorised to commit the tortious conduct. Another is exemplified by Colonial Mutual Life Assurance Society Ltd v The Producers and Citizens Co-operative Assurance Company of Australia Ltd (1931) 46 CLR 41 (CML) where it was held that a principal was liable for the slanders uttered by an independent contractor, Mr Ridley, with authority on behalf of his principal to solicit proposals for insurance and collect deposits, even where the principal had expressly forbidden disparaging statements of the very nature made by him. Relevantly for the purposes of resolving this appeal, it is clear that the decision in CML is to be understood as was explained in Sweeney at [14]-[19]. 16On the unchallenged facts as found in the present case, Checkmate was Mr James' employer, and was vicariously liable for his tortious conduct because it was incidental to his employment. It is clear that that conduct was not expressly authorised by the Hotel or Ms Elliott-Cosmos, a test which is much harder to satisfy than the approach based on "course of employment" which applies to the tortious conduct of employees. The primary judge found that the Ms Elliott-Cosmos and Ms May were not on the spot, and that all that was authorised was Ms Day's removal. Those findings were amply open on the evidence, which included testimony that the security guards were able to turn out patrons without recourse to the Hotel's management. 17Nor was Mr James acting as the agent of the Hotel or Ms Elliott-Cosmos in the requisite sense, so as to create vicarious liability. It is true that he was an "agent" within the meaning of s 77, and thus authorised by s 77(2) to withdraw the otherwise general permission extended to the public and by s 77(5) to use reasonable force to turn her out. But it does not follow that he was an "agent" in the sense used in CML. Dixon J made it clear in CML that Mr Ridley was liable, although he was an independent contractor, only because he was a "true agent" for the purpose of soliciting insurance proposals and taking deposits: at 50. That was why Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ insisted in Sweeney at [22] that the conclusion in CML: "depends directly upon the identification of the independent contractor as the principal's agent (properly so called) and the recognition that the conduct of which complaint is made was conduct undertaken in the course of, and for the purpose of, executing that agency." (emphasis added) 18Mr James undoubtedly exceeded the statutory power conferred upon him by s 77. But even if he were an "agent" within the meaning of that section, it does not follow that he was a "true agent", to use Dixon J's language in CML, or an agent "properly so called", to use the language in Sweeney above - that is to say, a person with authority to bind his principal. It is always dangerous unthinkingly to translate words deployed in one context to another. It is particularly dangerous where the word used to describe the person in both contexts is "agent", for, as Lord Herschell said, "[n]o word is more commonly and constantly abused than the word 'agent'": Kennedy v De Trafford [1897] AC 180 at 188. That is precisely the force of the High Court's criticism of loose language of agency in Sweeney at [13], [19] and [29]. 19It is clear on the evidence that Mr James was not the Hotel's agent in the conventional legal sense, namely, of being authorised to bind it. He had no such authority. Indeed, it was clear that he represented Checkmate. He was wearing Checkmate's uniform, which prominently displayed its mark. It was a condition of the hotelier's licence that security guards be "uniformed", which is to say, identified as not being hotel employees. 20It was submitted that the licensee might be directly liable via s 91 (no attempt was made to rely on s 7 of the Law Reform (Vicarious Liability) Act 1983, which would have required pleading and proof of the elements identified in Zorom Enterprises at [30]). But s 91 does not achieve the result of creating vicarious liability on the part of the Hotel or its licensee. A similar argument was rejected in Starks v RSM Security Pty Ltd [2004] NSWCA 351; (2004) Aust Torts Reports 81-763, whose facts were materially identical to those in the present appeal: a patron at licensed premises was assaulted by a security guard whose employer had contracted with the hotel to supply security services. In Starks an attempt was made to rely upon s 103, the predecessor section to s 77, which authorised: "A licensee or the employee of a licensee" to "turn out or cause to be turned out" persons who were intoxicated, violent, quarrelsome or disorderly. Beazley JA, with the agreement of Sheller and Grove JJA, said this (at [41]): "In this case, the appellant seeks to invoke the principles of vicarious liability as against the hotel by relying upon the statutory deeming of the employer [of the security guard] as an employee [of the hotel]. In my opinion, the Act does not have that effect. Part 6 of the Act deals with licensed premises. Section 103, which appears in Part 6 not only aids the licensee in the performance of its obligations in the control of licensed premises, it authorises action that might otherwise be unlawful such as the forceful ejection of an intoxicated person from the premises. The section has nothing to say, in my opinion, about the liability the hotel may have when a security guard, not directly employed by it, uses excessive force in carrying out a task otherwise authorised by s 103. If the hotel is to be liable, it must be under the principles of the general law. On the facts here, I have found that there is no such liability." 21In my opinion, the same reasoning applies to s 91. The antecedent of s 91 was s 101, also found in Part 6. Those sections are directed to answering the question who is obliged to comply with the elaborate regulatory regime established by the Act. Neither the Act nor its 1982 predecessor directly created tortious liability for breach of those sections; instead the regime is drafted on the basis that it is for the common law to supply any privately enforceable rights sounding in damages. That is exactly what Ms Day succeeded in obtaining when she obtained judgment against the employer of Mr James for committing an assault and battery not authorised by s 77. Much clearer language than is found in s 91 would be required in order to create a statutory vicarious liability on the part of the Hotel or Ms Elliott-Cosmos. Examples may be found in s 8 of the Law Reform (Vicarious Liability) Act, and s 410B of the Navigation Act 1912 (Cth) considered further below. 22In her written submissions (but not in oral address), Ms Day asserted vicarious liability based on an estoppel in accordance with what Gaudron J had said in New South Wales v Lepore [2003] HCA 4; (2003) 212 CLR 511 at [131]. This was correctly rejected by the primary judge, who appreciated that it was inconsistent with what had been said in Sweeney. Similarly, reliance was placed in writing (but not orally) on what was described as the "special circumstances" basis in Quarman v Burnett (1840) 6 M & W 499; 151 ER 509; this was rightly rejected by the primary judge for the same reason.

Dual vicarious liability? 23The foregoing is sufficient to resolve this appeal. But there is a more fundamental reason why in my opinion it should be dismissed. The plaintiff at trial contended for, and succeeded in obtaining, a finding that Checkmate was vicariously liable for Mr James' tort. The law has for centuries stood for the proposition made by Littleday J in Laugher v Pointer (1826) 5 B & C 547 at 558; 108 ER 204 at 208: "He is the servant of one or the other, but not the servant of one and the other; the law does not recognise a several liability in two principals who are unconnected." 24In Esso Petroleum v Hall Russell [1989] 1 AC 643 at 686, Lord Jauncey of Tullichettle said unambiguously that: "[T]here is no principle which permits a servant to be in the de jure employment of two separate masters at one and the same time." 25That rule may be of course be displaced where a new species of vicarious liability is created by statute, as has occurred in the case of s 917C of the Corporations Act (multiple holders of Australian Financial Services Licences may be liable for the conduct of a single authorised representative). But I am aware of no Australian decision where so-called "dual vicarious liability" has been upheld at general law, and the parties did not suggest otherwise. The position is different in England. The course of English authority was examined in the Court of Appeal in Viasystems (Tyneside) Ltd v Thermal Transfer (Northern) Ltd [2005] EWCA Civ 1151; [2006] QB 510 at [20]-[38] (May LJ) and [57]-[75] (Rix LJ) who concluded that "there is no doubt that there has been a long standing assumption that dual vicarious liability is not possible" (at [76]; see also at [39], [46]). Their Lordships nevertheless held that no binding authority prevented them from finding two different defendants each vicariously liable for the tortious act of a third person (at [49], [77]), and that conclusion was accepted as correct by the Supreme Court (although without argument) in Various Claimants v The Catholic Child Welfare Society [2012] UKSC 56; [2012] 3 WLR 1319. 26In my opinion, binding authority precludes this Court from taking that step, although it was urged upon us by Ms Day. In Oceanic Crest Shipping Company v Pilbara Harbour Services Pty Ltd (1986) 160 CLR 626, a ship caused damage because of the negligent pilotage of Captain Hammonds, who was an employee of the respondent port authority. Pilotage was compulsory under Western Australian law, and s 410B of the Navigation Act provided that: "(1) A pilot who has the conduct of a ship is subject to the authority of the master of the ship and the master is not relieved from responsibility for the conduct and navigation of the ship by reason only of the ship being under pilotage. (2) Notwithstanding anything contained in a law of the Commonwealth or of a State or Territory, the owner or master of a ship navigating under circumstances in which pilotage is compulsory under a law of a State or Territory is answerable for any loss or damage caused by the ship, or by a fault in the navigation of the ship, in the same manner as he would if pilotage were not compulsory." 27Because s 410B(2) unquestionably made the appellant shipowner liable, the question on appeal was whether the port authority was vicariously liable for the negligence of its employee. A majority of the High Court held that it was not. One strand in the reasoning was a refusal to accept an invitation to review Fowles v Eastern and Australian Steamship Co Ltd [1916] 2 AC 556 "in the light of the developments which have taken place in the ... modern law of vicarious liability", as counsel for the shipowner had put it (at 628). Fowles had decided that a pilot's employer was not liable for damage caused by the pilot's negligence when a ship was under compulsory pilotage; it was said by the shipowner that Fowles could not be reconciled with the development in Zuijs v Wirth Brothers Pty Ltd (1955) 93 CLR 561 that even where an employee's work involved special skill or independent judgment and could not be controlled by the employer, the employer would still be vicariously liable, on the basis that "what matters is lawful authority to command so far as there is scope for it ... if only in incidental or collateral matters" (at 571). 28But a second strand of the reasoning, which in my opinion applies to this appeal, was that the necessary effect of the shipowner being vicariously liable was that there could be no vicarious liability on the part of the employer port authority. Gibbs CJ said (at 641, citations omitted): "Sub-section (2) has the effect that 'a shipowner who through a compulsory pilot is responsible for faulty navigation is responsible for damage to his own ship as well as for injury to the property of another': Workington Harbour & Dock Board v Towerfield (Owners). This provision, which was not in force at the time of the stranding which gave rise to Fowles v Eastern and Australian Steamship Co Ltd, provides an additional reason for concluding that, in the case of compulsory pilotage, the employer of a pilot is not responsible for his negligence. 'The law does not recognise a several liability in two principals who are unconnected': Laugher v Pointer. This is another rule which is criticized by Professor Atiyah who nevertheless appears to accept that the question is settled, although he points out that one employer may be held vicariously liable while another is liable on another ground. Where the services of the servant of one employer are temporarily used by another, both employers will not be liable; prima facie the liability will usually remain with the general employer who may, however, 'show, if he can, that he has for a particular purpose or on a particular occasion temporarily transferred the services of one of his general servants to another party so as to constitute him pro hac vice the servant of that other party with consequent liability for his negligent acts': Mersey Docks and Harbour Board v Coggins and Griffith (Liverpool) Ltd. In the case of a pilot, s 410B(2) of the Navigation Act casts the liability directly on to the shipowner and in consequence excludes any liability of the general employer of the pilot." 29Wilson J said (at 646): "[T]he only basis available to Oceanic in support of its claim is the proposition that [the port authority], as the employer of the pilot, was vicariously liable to [the owner of the damaged wharf] for his faulty navigation. But that liability cannot co-exist with an identical liability attaching to [the shipowner]. It is unnecessary to look for the exceptional circumstances that would, consistently with the views of the House of Lords in Mersey Docks and Harbour Board v Coggins and Griffith (Liverpool) Ltd, result in the transfer of the service and control of a servant from a general employer to a particular employer so as to attach vicarious liability for the servant's negligence to the latter. It is unnecessary because the statute has pre-empted the answer." 30Dawson J said (at 685): "[A] compulsory pilot must, for the purpose of imposing responsibility for loss or damage caused by his pilotage, be regarded as the servant of the shipowner. The vicarious liability imposed by the section is as if the pilotage were not compulsory, that is, as if it were voluntary. That means, fiction though it might be, that the position of the compulsory pilot as regards the owner is one in which the maxim respondeat superior applies, necessarily excluding the responsibility of some other person upon the same basis." 31On my reading, those passages demonstrate that common to one of the lines of reasoning employed by the majority in Oceanic Crest was the proposition of law that once one person was vicariously liable, no other person could be. But even if I be wrong about the proposition forming part of the ratio of the case, it amounts to "long-established authority and seriously considered dicta" of the High Court which should be followed: Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 at [134] and [147] and see Ying v Song [2009] NSWSC 1344 at [17]-[20] (Ward J). 32The fact that there were two reasons given in dismissing the appeal does not mean that either is any less binding: Gutman v McFall [2004] NSWCA 378; (2004) 61 NSWLR 599 at [57] Giles JA (Mason P and McColl JA agreeing); Bondi Beach Astra Retirement Village Pty Ltd v Gora [2011] NSWCA 396; (2011) 16 BPR 30,111 at [215] (Campbell JA, Giles and Whealy JJA agreeing). As Jordan CJ said, "we are not entitled to pick out one reason for the judgment as the ratio decidendi and neglect the other": Ex parte King; Re Blackley (1938) 38 SR (NSW) 483 at 490. 33It follows that in my opinion it is not possible for any court other than the High Court to adopt the submission advanced by Ms Day that Australian law admits of a theory of dual vicarious liability where two different persons had control over a tortfeasor. Oceanic Crest was not raised by the parties, and if the outcome of the appeal turned on the point, I would have invited the parties to make further submissions: cf Perpetual Custodians Ltd as custodian for Tamoran Pty Ltd as trustee for Michael Crivelli v IOOF Investment Management Ltd [2013] NSWCA 231 at [130]. Since it does not, I merely express my views that (a) this Court is bound to reject Ms Day's submission and (b) in any event, where as here there is a well-established basis of vicarious liability, namely, that of employer for the tortious conduct of its employee in the course of the employee's employment, there is no sound basis for imputing vicarious liability to another person, who did not even have a contractual relationship with the wrongdoer.

Damages 34Ms Day's notice of appeal also challenged the primary judge's "assessment of general, aggravated and exemplary damages as manifestly inadequate". Against the possibility that the foregoing is wrong, or that Checkmate's registration is reinstated, it is appropriate to deal with this last ground of appeal: Kuru v New South Wales [2008] HCA 26; (2008) 236 CLR 1 at [12]. 35His Honour's assessment of general damages was based on a finding that Ms Day suffered "transient minor lower back symptoms lasting three or four days with full recovery" (at [71] and [79]). That finding was based on the evidence of Dr Schutz, the evidence of Ms Day that she did not see a doctor following the incident, and the explanations given when she was admitted to hospital a year later for back surgery: "[C]hronic back pain from an epidural and accident 8 years ago and says it flares up about once a year and lasts a few weeks. States it is worse this time, has been painful for 7 weeks and this morning she woke up and couldn't move at all due to the pain which she says was 10/10 then...[She also gave a history of] known LBP with occasional flare-ups ... since 2001 after epidural injection for labour." 36His Honour approached the question of damages by asking whether the incident aggravated Ms Day's pre-existing condition (at [78], emphasis in original): "Mr Chrysostomou said I can accept his client's evidence as to what she was like post the incident. I do not reject that evidence, but the question is, as Mr Chrysostomou correctly points out ... 'whether it's more probable than not, the incident aggravated the plaintiff's pre-existing condition'." 37His Honour concluded that it did not for five reasons (at [79]): "(a) there was a history of long-standing back pain with regular flare-ups; (b) there was an almost complete absence of complaint in the hospital records about the incident at the hotel; (c) there is an absence of medical evidence demonstrating treatment or advice which Julia Day received between the incident and the hospital, even though she said that she had complained; (d) there is no firm medical evidence of a link, on the other hand; (e) there is firm medical evidence of a lack of a link." 38The challenge to the primary judge's ultimate finding focused on the fifth of those five reasons. It was said that the primary judge erred by relying on the evidence of Dr Schutz in circumstances where he had accepted the evidence of Ms Day that her lower back pain was more severe following the incident. However, the acceptance in the reasons was qualified, as is plain from the language at [78] reproduced above, and that qualified acceptance does not undermine the primary judge's reliance on Dr Schutz. Attention was also directed to a statement in the transcript "Yes, I must say I was impressed by what she said" (Black 462.12), but statements during the course of the trial fall far short of findings of fact, and in any event when read in its context, his Honour's statement was a reference to Ms Day's evidence about undertaking a course to further her training (Black 462.8-10). In my opinion it was amply open to the primary judge to find that the incident did not aggravate the pre-existing condition. It follows that there was no error in his not allowing any component of damages for out of pocket expenses or economic loss. 39Next it was said that aggravated or exemplary damages should have been awarded for interference with a human being's dignity and autonomy. Reliance was placed on Adams v Kennedy [2000] NSWCA 152; (2000) 49 NSWLR 78 where exemplary damages of $100,000 were ordered to disapprove a serious trespass to property and to the person and false imprisonment committed by three police officers. Counsel acknowledged that that was not indicative of the level of damages sought in this case, but it was said that "it should be significant and demonstrate the community's dislike for interferences with one's personal integrity." 40Although it can be difficult to separate aggravated and exemplary damages, it is necessary to do so: Lamb v Cotogno (1987) 164 CLR 1 at 8; Gray v Motor Accident Commission [1998] HCA 70; (1998) 196 CLR 1 at [6]; New South Wales v Ibbett [2006] HCA 57; (2006) 229 CLR 638 at [33]. They were distinguished by Windeyer J in Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 as follows (at 149): "[A]ggravated damages are given to compensate the plaintiff when the harm done to him by a wrongful act was aggravated by the manner in which the act was done: exemplary damages, on the other hand, are intended to punish the defendant, and presumably to serve one or more of the objects of punishment-moral retribution or deterrence." 41Where as here the power to assess damages is conferred on a judge, and it has not been shown that there was any error of principle or misapprehension of the facts, the question is whether there has been a "wholly erroneous" determination: Miller v Jennings (1954) 92 CLR 190 at 195-196 (Dixon CJ and Kitto J); Precision Plastics Pty Ltd v Demir (1975) 132 CLR 362 at 369 (Gibbs J); Gamser v Nominal Defendant (1977) 136 CLR 145 at 148-149 (Gibbs J). That high level of appellate deference, which is to be traced to Greer LJ's reasons in Flint v Lovell [1935] 1 KB 354 at 360, is applicable to the assessment of damages by the primary judge generally. It is heightened where the assessment relates to injury to the plaintiff's feelings, and still more so where the assessment raises the much broader questions of punishment and deterrence underlying exemplary damages. 42It follows that a wide leeway is necessarily permissible in both aggravated and exemplary damages. The primary judge formed the view that the injury suffered by Ms Day was relatively minor, and in my opinion his Honour was entitled to do so. The primary judge then awarded aggravated damages at the same amount as general damages. Consistently with the observation in Lamb v Cotogno at 8 that aggravated damages are ordered "for injury to the plaintiff's feelings caused by insult, humiliation and the like" his Honour gave express consideration to the public humiliation of Ms Day in familiar surroundings: at [86]. I see no error in the award of aggravated damages. 43Exemplary damages must "not be out of all proportion in the circumstances": Adams at [35]. Exemplary damages may exceed compensatory damages in an appropriate case: Adams is one example, and in copyright contexts, see Raben Footwear Pty Ltd v Polygram Records Inc [1997] FCA 370; (1997) 75 FCR 88 and Aristocrat Technologies Australia Pty Ltd v DAP Services (Kempsey) Pty Ltd [2007] FCAFC 40; (2007) 157 FCR 564 at [54]. I am conscious of the difficulties, identified in Gray v Motor Accident Commission at [25]-[31], in describing the power to award exemplary damages as "discretionary", but that does not deny that there is apt to be a wide range of amounts which may be ordered without appellable error. Other judges might have been minded to order larger exemplary damages than the primary judge. However, I am not persuaded that the primary judge, who had the benefit of seeing Ms Day and Mr James, went outside the broad discretion open to him in making an order of exemplary damages in the same amount as the sum of general and aggravated damages. 44Finally, it was said that: "[A] liability of the first and second respondent would result in a significant increase in this award based on community expectation that persons in positions of responsibility and control selling liquor would exercise those powers reasonably and responsibly and admonish conduct inconsistent with that responsibility". 45In my view, nothing in the principles stated in Kuru and similar cases makes it appropriate to consider what the appropriate exemplary damages would be in the event that, contrary to my views above, the Hotel or Ms Elliott-Cosmos were vicariously liable for Mr James' tort. That is a complex question, some aspects of which are mentioned by Gibbs CJ and Brennan J in XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd (1985) 155 CLR 448. 46For those reasons, the appeal should be dismissed with costs. To the extent that the third respondent has purportedly been joined to this appeal, its name should be removed.

Amendments 07 July 2014 - The reference "17(2)" replaced by "77(2)". Amended paragraphs: [17] 07 July 2014 - The reference "[44]" replaced by "[41]". Amended paragraphs: [20] 07 July 2014 - The reference "[77], [49]" replaced by "[49], [77]". Amended paragraphs: [25] 07 July 2014 - The words "by a wrongful act" inserted. Amended paragraphs: [40] 07 July 2014 - The words "a law of a State or a Territory" replaced by "a law of a State or Territory". Amended paragraphs: [26] 07 July 2014 - The name "Barnett" replaced by "Burnett". Amended paragraphs: [22] 07 July 2014 - The reference "17(5)" replaced by "77(5)". Amended paragraphs: [17] 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: 07 July 2014