Frisbo Holdings v Austin Australia

Supreme Court of NSW|2009-11-23|Before: Hislop J

Introduction 1 Patrick Ryan was born in 1981. He was a member of the Queensland State U/16 softball team. On 3 January 1997, the team was staying at a hotel in Bankstown, New South Wales. The hotel was owned and operated by the plaintiffs. Mr Ryan sustained injury (tetraplegia) whilst in the pool/spa area of the hotel. 2 Mr Ryan brought proceedings against the plaintiffs and the Queensland Softball Association Inc to recover damages for his injury. In his amended statement of claim he alleged the injury occurred when, whilst exiting the spa, he slipped and fell head first into the pool. He asserted the injury was caused by the negligence of the plaintiffs and the Queensland Softball Association Inc. 3 His claim was settled in June 2005 by the plaintiffs and the Queensland Softball Association Inc on a compromise basis. The plaintiffs' contribution to the settlement was $1.5 million inclusive of costs. 4 The decision to settle the matter on behalf of the plaintiffs was made by Mr Alexander, the then claims manager of the plaintiffs' insurer. In his statement dated 4 December 2008 [Exhibit A], Mr Alexander concluded: "I formed the opinion, based on my own experience, and taking into account the advices of the Allianz legal advisors, that $1,500,000 represented a reasonable and appropriate commercial settlement of the Ryan proceedings, given the available evidence and taking into account Allianz's potential exposure in the Ryan proceedings if they were not settled." 5 The plaintiffs (who it is agreed are to be treated as one for present purposes) commenced these proceedings by statement of claim filed in this court on 4 May 2006. They sought to recover from the defendants the settlement sum of $1.5 million together with the costs incurred by them in defending the proceedings brought by Mr Ryan and interest. The first defendant was sued as the head contractor for the construction of the hotel, which was constructed in or around 1988/89. It had designed and prepared drawings for the construction of the pool and spa. The second defendant was sued as the constructor of the pool and spa. The plaintiffs alleged that each of the defendants owed Mr Ryan a duty of care to ensure the premises were designed and/or constructed in such a manner as to be free of risk of injury to persons, which duty they had breached. 6 The parties agreed to an independent referee, Mr Watson SC, assessing the potential range of damages should Mr Ryan have been totally successful in his claim against the plaintiffs. Mr Watson opined that the low to high range of the damages likely to be awarded to Mr Ryan in February 2006 (the likely hearing date of Mr Ryan's action had it not settled) was $2,785,000-$5,309,000, with the most likely award being $4,234,000. In calculating that sum, no allowance was made for the possibility of contributory negligence on the part of Mr Ryan. The parties accepted Mr Watson's opinion. 7 The plaintiffs advanced two bases for recovery, namely

(a) that the defendants and the plaintiffs were joint tortfeasors for the purposes of the Law Reform (Miscellaneous Provisions) Act 1946 ("the Act") and the plaintiffs were entitled to indemnity or contribution from each defendant; and/or

(b) each defendant owed them an independent duty of care and that duty had been breached. 8 The defendants denied liability to the plaintiffs. 9 The first defendant cross-claimed against the second defendant. It claimed damages for breach of the contract between the defendants, damages pursuant to a duty owed by the second defendant to the first defendant in respect of the construction of the pool and spa complex, indemnity under a term of the contract and indemnity or contribution pursuant to the Act. In its defence to the cross-claim, the second defendant denied liability and pleaded that the first defendant's cross-claim was statute barred by the Limitation Act 1969, s 14 and s 26. No cross-claim was brought by the second defendant against the first defendant.

The pool/spa layout 10 Inspection of the pool and spa area in March 2002 revealed that the pool was oblong in shape, 9850 mm long and 4410 mm wide. Its internal surface was finished with a medium-rough concrete finish topped by two rows of blue tiles which abutted the coping of the pool surround, which was comprised of brown terracotta tiles, 100 mm by 200 mm. The depth of the pool varied from approximately 0.8 m at the shallow end to 1.65 m at the deep end. 11 The spa was octagonal in shape and part of it intruded into the shallow end of the pool. Steps into the pool were located between the spa and the end of the pool and abutted each. 12 The spa had an overall depth of 865 mm, width 2100 mm. There was a 445 mm step down from the surround to a large seat in the spa. Surrounds on the pool side of the spa were approximately 300 mm wide. The sides of the spa were finished with small blue tiles, as was the seat. The top surface comprised the brown terracotta tiles previously mentioned. The bottom of the spa was epoxy coated. 13 Save for the seat which was used as a step, there were no steps into the spa. There was no designated entry or exit points into the spa. There were no handrails to assist entry or egress from either the pool or the spa.

The lay evidence 14 Mr Ryan was called by the plaintiffs to give evidence. A witness statement recently made by him supplemented that evidence. His evidence as to what occurred was, essentially, as follows.

(a) There were seven or eight members of the team in the spa at the time of his accident. It was not a big spa and pretty much all of the space was taken up, so much so that there was one boy in the spa who had nowhere to sit and as a result was sitting on the floor of the spa.

(b) After about 10 minutes, he decided to get out of the spa. He had been sitting with his back to the pool and nearest to the pool. He said in his statement that he was getting out of the spa to go and pick up his key which he had thrown onto the pool surrounds and to put it on the table where he had left his towel and then go for a swim. The key and table were toward the deeper end of the pool.

(c) In his written statement, he said that he got up where he had been sitting and turned to exit. He stood up in the bottom of the spa and turned, putting one foot on the seat, which he thought was about 50 cm high. At this point, his memory is non-existent of that moment. He was not rushing or mucking around.

(d) In his oral evidence, Mr Ryan said: "A. I turned to get out of the spa, put one foot up on the blue tiles on the seat, and went to hop out of the spa directly where I was sitting.

Q. When you say you put your foot up on the blue tiles, do you recall how high that was, how high the step up was for you? A. Probably about 50 centimetres high.

Q. What happened then as you decided to get out? A. Basically yeah, I put my foot up on the spa, and that was the end of my recollection.

Q. And you were sitting with your back to the main swimming pool? A. Yes.

Q. And you turned around to face the swimming pool to get out? A. Yes.

Q. And that left you getting out towards the swimming pool; is that right? A. Yes."

(e) Mr Ryan was cross-examined on the basis that he had told the team scorer, "I stood up to go from the spa to the pool and my foot slipped". He said he did not remember saying that at all and did not remember slipping at all. He did not accept it was possible that he was going from the spa to the pool at the time the accident happened.

(f) He was cross-examined on the basis that a witness had said that he saw Mr Ryan "kneel on the edge of the spa and slide in". He said he did not recall doing that, although he agreed it was possible.

(g) He was cross-examined as follows: "Q. In other words, your last memory is of getting up to exit the spa, you think intending to go to the pool edge or pool side? A. Up on the bit between the spa and the pool."

(h) It was suggested that his memory may be faulty and he had always intended to get from the spa into the pool. He said he did not believe so, as he was "too worried about losing the key".

(i) He was asked if, as he went to exit the spa, he might have changed his mind about going onto the pool edge and decided instead to go into the pool. He answered, "I don't know, sorry". He was asked if it was a possibility, and answered "It's a possibility".

(j) Mr Ryan said that his chest had been grazed. 15 Bradley Priestley was called by the plaintiff. He gave evidence that he had been a member of the team. He was in the spa at the same time as Mr Ryan. There were seven or eight team members in the spa at the time. There was no "mucking around" by them. There were no handrails into the spa. He did not recall any steps into or out of the spa. When asked what he recalled about the incident with Mr Ryan, he said: "I recall sitting in the spa talking to one of the younger fellows, the youngest player on the team, telling him he wasn't going to get any game time if he didn't move over. As I said, just playing around a little bit. I remember in the corner of my eye seeing [Mr Ryan], I think on my left-hand side. It to me looked like he was either getting out or going somewhere, didn't take any notice of it exactly. And next thing I know, I looked across and I seen [Mr Ryan] in the pool with a look in his eye like he was in trouble." 16 Mr Priestley was cross examined in respect of a statement made by him shortly after the accident. He agreed that what he had written was what he would have remembered at the time. The contents of the statement were put to him. He was unable to remember the matters therein stated. 17 The statement, relevantly, was in the following terms: "I was sitting in the spa facing the pool and saw [Mr Ryan] with 1 foot in deep part of spa, 1 foot near the seat of the spa, knee on inside edge of spa-brown tiles. Leaning over looking into water (out of corner of eye). Slid/slipped? Into the pool and went straight down, head first." 18 The statements of other team members were also in evidence. They were, shortly, as follows:

(a) Dean Riley: "Sitting in spa facing towards where [Mr Ryan] was pulled out. [Mr Ryan] stood in the bottom of spa (between seats). I looked back to the boys beside me and continued talking. I was aware of [Mr Ryan] entering but did not see how he entered."

(b) Brett Williams: "I was sitting in the middle of the spa on the bottom (where all the legs were). I ducked under the water (in spa) eyes closed and was unaware of [Mr Ryan] going into the pool."

(d) Zenon Winters: "…I saw [Mr Ryan] slide into the pool from the spa…Fairly certain [Mr Ryan] had 1 knee or both or both feet on brown tiles, definitely had hands on front edge of brown tiles, leaning forward as if he was looking into pool, definitely didn't dive, rolled forward/slid into pool."

(e) Christine Denkel [team scorer]: "[Mr Ryan] explained what happened and how he was feeling. 'I stood up to go from the spa to the pool and my foot slipped.'"

(f) Tiran Armstrong: "Sitting in spa facing [Mr Ryan] when he entered the pool. He stood up in spa then stepped both feet onto blue seating resembling a squat position (like a sprint start), both hands on brown tiles, turned his head over his right shoulder looking towards me. Last I remember he was pushing himself up, over the coping to enter the pool. I didn't see him enter the water."

(g) Crawford Connell: "Relaxing in spa situated with my back to [Mr Ryan]. Hearing slap of hands on tiles quick glance over then looked back again to others. I was aware of him entering the pool but didn't see him get in." 19 The second defendant's director, Mr Christochowitz, gave the following evidence: "Q. Do you recall a request for a handrail for this pool? A. I recall a note in our agreement for the supply of a handrail. Q. One wasn't provided? A. I don't know, it may well have been delivered to the site. Q. Did you have any role at all in ensuring that the contract was complied with? A. David McDonald looked after that quite well." 20 He identified his company's internal cost card (Exhibit C) from the salesman to the second defendant's office which contained an item "S/s handrail at steps $250 ". He agreed "S/s" meant stainless steel but said he did not know if the rail made it to the pool. He said there was no evidence it was put in and he had not seen one there. He was shown a poor quality photocopy (Exhibit D) that he identified as written by the second defendant's initial sales consultant. He was able to read the word "spa" and words that looked like "Add steps" and "Add h'rail".

The expert evidence 21 It was agreed at a conference of the experts qualified in this matter, and accepted by the parties, that:

(a) Australian Standard 2610.1-1983 and Australian Standard 2818-1986 applied to the design and construction of the pool/spa.

(b) The absence of a handrail and steps into the spa breached the Australian Standard in that regard.

(c) The absence of a handrail and steps into the spa accorded with usual practice in the pool building industry as at the time of construction.

(d) The co-efficient of friction of the tiles that formed the concourse and the tiles in the spa, when measured at the time of the conference of experts, accorded with usual practice in the pool building industry.

(e) The Australian Standard required that the spa tiles be "slip resistant". This term was not defined. The majority of the experts concluded the co-efficient of friction of the tiles in the spa, including those on the seat, met the Standard. 22 There were some differences of opinion between the experts on other aspects and these are considered later in this judgment.

The defendants' liability to Mr Ryan under the Act 23 Section 5(1)(c) of the Act provides, relevantly: "Where damage is suffered by any person as a result of a tort (whether a crime or not):

(c) any tort-feasor liable in respect of that damage may recover contribution from any other tort-feasor who is, or would if sued have been, liable in respect of the same damage, whether as a joint tort-feasor or otherwise …" 24 Section 5(1)(c) in its terms required that the plaintiffs were tortfeasors liable in respect of Mr Ryan's damage and that the defendants would, if sued, have been liable in respect of the same damage. 25 Counsel for the plaintiffs identified the issues in relation to the spa as "four heads of debate about the actual pool, that is, handrail, entry and exit points, the tiles, and the barrier in relation to the interrelationship of both pools" and "to what he would have done".

The plaintiffs' primary case 26 The plaintiffs' primary case against the defendants was, in substance, as follows:

(a) the defendants knew the premises were to be used for commercial purposes, namely as a hotel. They also knew the pool and spa would be used by a range of people including children, the aged and the infirm;

(b) there was a risk such persons may slip, trip or fall when entering or exiting the spa, particularly having regard to the height of the seat;

(c) the defendants owed a duty to take reasonable care for the safety of that class of person, including Mr Ryan as a member of that class.

(d) the relevant Australian Standards called for the provision of a handrail and steps into the spa thereby defining the entry and exit points;

(e) reasonable care required the provision of the handrail and steps in accordance with the Australian Standard;

(f) the defendants had agreed to supply a handrail;

(g) no handrail was present at the time of Mr Ryan's injury;

(h) if there was an entry/exit point designated by a set of steps and a handrail as required by the Australian Standard and Mr Ryan had used the steps and handrail, it was improbable he would have slipped and, if he did slip, that he would not have been able to prevent himself from falling;

(i) if there had been a handrail and steps, Mr Ryan would have used them;

(j) accordingly, the defendants, if sued by Mr Ryan, would have been liable for the damage to him.

The defendants' submissions in response to the plaintiffs' principal argument 27 The defendants submitted, in essence:

(a) it was accepted by the experts and the parties that the absence of a handrail and steps into the spa conformed with the usual practice in the pool building industry at the time of construction. This, though not conclusive, was an important evidentiary fact supporting the contention that there was no breach of duty in not providing steps and a railing - Mercer v Commissioner for Road Transport and Tramways (NSW) (1936) 56 CLR 580 at 589;

(b) there had been no accident in the pool/spa area (apart from the injury to Mr Ryan) since its construction in 1988/89. This was an evidentiary fact of considerable weight - Makita (Australia) Pty Limited v Sprowle (2001) 52 NSWLR 705 at [5]; RTA v Dederer (2007) 234 CLR 330 at [61]. Further, the plaintiffs had not erected steps or a handrail following the injury to Mr Ryan;

(c) the Australian Standards, of themselves, had no legal force - Chico v The Corporation of the City of Woodville (1990) Aus Torts Rep 81,028. As Wood CJ at CL observed in Lanza v Codemo [2001] NSWSC 845 at [169]: "Mere compliance with the Standard, or even with common practice, does not solely or even primarily determine whether negligence exists or not. Evidence as to practice, or as to the existence of a Standard remains relevant, and it may help in determining what proper care and skill requires to be done in a particular context. However, in the end it is for the court to adjudicate upon what is the appropriate standard of care."

(d) the evidence does not establish that the handrail referred to in the cost sheet was installed. There was no explanation of why the handrail had not been installed, if such was the case. It may be that for aesthetic or other reasons, such as children swinging on it or the like, that the plaintiffs had decided that it should not be installed. It was not established that if the handrail was installed at the time of construction it was not later removed by the plaintiffs during the refurbishing or at some other time. It is a matter of conjecture as to what occurred in relation to the handrail;

(e) the duty owed to Mr Ryan was not to be judged by the duty owed to the infirm or ailing. Mr Ryan was a young, fit sportsman who did not require steps or a handrail to exit the spa when the seat was available to be used as a step. The extent of the duty owed to Mr Ryan was not to be judged by reference to the very young, the aged or the infirm. Mr Ryan was a young, fit sportsman. This was a factor which was relevant to the question of the extent of the duty owed to him - Wilkinson v Law Courts Limited [2001] NSWCA 196 at [28]. To such a person the task of safely exiting the spa using the seat was an undemanding activity and one well within the everyday experience of an active young man. The matter was to be adjudged prospectively and not retrospectively ( Roads and Traffic Authority of NSW v Dederer ) in circumstances where no previous injury had occurred and where the absence of steps and a handrail conformed with normal industry practice. It did not require that he be warned or that safety measures be taken. 28 I accept the defendants' submission. In my opinion, reasonable care for Mr Ryan did not require the provision of steps or handrail. There was no breach of duty owed by the defendants to Mr Ryan in respect of the plaintiffs' primary case.

Causation 29 Even if the plaintiffs established the defendants were in breach of their duty to Mr Ryan they could only succeed if they established that injury to Mr Ryan was caused or materially contributed to by the acts or omissions of the defendants. 30 The plaintiffs submitted that Mr Ryan's evidence, and the inferences which the Court could draw from the circumstances, established that Mr Ryan would have used the steps and handrail had they been provided and by so doing would have avoided injury. 31 Mr Ryan gave the following evidence as to what would have occurred had there been a handrail or steps in the spa:

(a) In his statement, he said: "If there had been handrails to use to exit the spa I would have used that exit and held the handrail when I got out."

(b) (In chief): "Q. Just going back, if there had been steps going in or out of the spa, or particularly out, what would you have done in relation to those? A. I most likely would have used them. Q. You recall I asked you earlier about a handrail? A. Yes. Q. Do you recall whether there was - you said there was no handrail present at the time. If there had been a handrail present, what would you have done? A. We used the handrail and the steps. Q. Was there anything about the boys in the spa that would have affected your decision so far as you could recall? A. No, not really. Maybe the boy on the bottom of the spa maybe. Q. What do you mean by that? A. Whether I could have got past him I guess."

(c) (In cross examination): "Q. You would have had to have climbed over the top of the boy in the middle of the spa to get out at the point in the spa, the opposite of the pool, is that right? A. Yes. Q. So what I want to suggest to you is that you went out the way that you did, that is the direction that you did, because the spa was crowded; do you think that is likely? A. Yes because there was nowhere else to go."

(d) (In cross examination): "Q. When you gave evidence earlier Mr Ryan about what you might have done, if there had been a handrail there, would you agree that you really have no confident view about what you would have done in relation to a handrail one way or the other? A. Not really, not with that amount of people in the spa, no. … Q. Would you agree with me that at that stage, at that time you were not always careful to take the safest course? A. No I don't believe I would have taken any other course to which I did. I turned to step where I was sitting."

(e) (In re-examination): "Q. You were also asked a question about a handrail and if you had a confident view, and you gave an answer 'not really with that many people in the spa'. What do you mean by that? A. I don't believe I would have used the handrail if there was that many people in there. But if you couldn't really sit on the handrail, maybe I would have. Q. 'Sit on the handrail, maybe I would have', what do you mean by that? A. I would have used the handrail because there wouldn't have been people sitting on the handrail, basically." 32 The above evidence was admitted provisionally, subject to a determination of an objection by the defendants that the evidence, in part, was rendered inadmissible by the application of the Civil Liability Act, 2002, s 5D(3)(b). 33 Section 5D provides, relevantly: " 5D General principles

(3) If it is relevant to the determination of factual causation to determine what the person who suffered harm would have done if the negligent person had not been negligent: (a) the matter is to be determined subjectively in the light of all relevant circumstances, subject to paragraph (b), and (b) any statement made by the person after suffering the harm about what he or she would have done is inadmissible except to the extent (if any) that the statement is against his or her interest." 34 Section 5D forms part of Pt 1A of the Civil Liability Act. Section 5A of that Act provides: " 5A Application of Part

(1) This Part [ie Pt 1A] applies to any claim for damages for harm resulting from negligence, regardless of whether the claim is brought in tort, in contract, under statute or otherwise.

(2) This Part does not apply to civil liability that is excluded from the operation of this Part by section 3B." 35 "Harm" is defined in s 5 as means "harm of any kind, including the following: (a) personal injury or death; (b) damage to property; (c) economic loss" 36 The plaintiffs submitted that s 5D(3) had no application as the object and purpose of the Act was to make provision for the recovery of damages for death or personal injury caused by negligence. The sub-section only applies to statements given by a plaintiff who has suffered personal injury. The reference to economic loss in the definition of "harm" was to economic loss suffered by the person sustaining personal injury. The claim made by the plaintiffs was not a claim for damages for death or personal injury caused by negligence but was a claim for an indemnity or for pure economic loss. Furthermore, Mr Ryan no longer had an interest in the matter when he came to give his statement and evidence. 37 The defendants submitted that s 5D(3) did apply essentially by reason of the reference to economic loss in the definition of "harm". Thus, the statement made by Mr Ryan and his evidence in these proceedings to the effect he would have used the steps and handrail was not admissible and should be struck out. 38 In my opinion, the plaintiffs' submission should be accepted for the reasons given by the plaintiffs and because that construction coincides with the recommendation made by the committee whose review of the law of negligence in 2002 gave rise to the legislation. The recommendation was that: "…in determining causation, any statement by the plaintiff about what they would have done if the negligence had not occurred should be inadmissible."

Accordingly, the evidence as to causation previously admitted provisionally should be admitted without qualification. 39 The defendants submitted that even if Mr Ryan's evidence was admitted, the Court would not conclude that Mr Ryan's injury was caused or contributed to by the absence of steps and a handrail. The location where the steps and handrail would have been placed, if installed, is unclear. It would appear reasonable to assume it would have been at or toward the opposite side of the spa to that occupied by Mr Ryan. Mr Ryan's intentions when he stood up to leave the spa were unclear. There is evidence that he intended to enter the pool from the spa and his original statement of claim so alleged. If Mr Ryan was intent on entering the pool from the spa, then it is extremely unlikely he would have proceeded to the other side of the spa in order to climb out using the steps and handrail. 40 If he intended to walk to his friends at the deep end of the pool or to pick up his towel then it may be that, if the spa was empty, he possibly may have used the steps and handrail but if the spa was crowded, as it was at the time of his accident, it seems to me inherently unlikely, having regard to his youth and fitness, that he would have climbed over his friends in order to use the handrail and steps. 41 Mr Ryan conceded as much in his evidence, initially asserting he would have used the steps and handrail if they had been in the spa but, when reminded of the number of persons in the spa, concluding he was unlikely to have done so. In my opinion, the only inference that can be reasonably drawn is that Mr Ryan would not have used steps or handrail to exit the spa. 42 The relevant principle was stated by the High Court in Chappel v Hart (1998) 195 CLR 232 at [32]: "Furthermore, a defendant is not causally liable, and therefore legally responsible, for wrongful acts or omissions if those acts or omissions would not have caused the plaintiff to alter his or her course of action. Australian law has adopted a subjective theory of causation in determining whether the failure to warn would have avoided the injury suffered. The inquiry as to what the plaintiff would have done if warned is necessarily hypothetical. But if the evidence suggests that the acts or omissions of the defendant would have made no difference to the plaintiff's course of action, the defendant has not caused the harm which the plaintiff has suffered."

See also Ellis v Wallsend District Hospital (1989) 17 NSWLR 553 at 581 and Hoyts v Burns (2003) 201 ALR 470 at [54]. 43 In my opinion, the evidence suggests that the acts or omissions of the defendants would have made no difference to the plaintiffs' course of action; the defendants have not caused the harm which Mr Ryan suffered. The plaintiffs, accordingly, have not established that the injury to Mr Ryan was caused or materially contributed to by the failure to provide steps or a handrail at the spa. 44 The plaintiffs advanced two other bases which they submitted would justify a liability finding against the defendants. The first of these was that there should have been a barrier between the spa and pool, or that the spa should have been built some distance from the pool and should not have encroached upon it. This was an opinion expressed by a minority of the experts. 45 Another of the experts, Mr Clarke, a pool builder of many years experience, gave evidence that: "… in the 1980s it was very common to have a spa in close proximity to the pool so that one lot of filtration equipment only was required, because the water mixes. In my 35 years in the industry I have never known that combination to cause any problems other than in this case.

… it was not common practice to place barriers [between pool and spa]. As a matter of fact in this pool spa combination I've never seen a barrier." 46 None of the experts were aware of any published study that recommended the placement of a barrier between the pool and spa to prevent movement between the two and there was no requirement in the Australian Standard in that regard. There is also a question of aesthetics - Phillis v Daly (1988) 15 NSWLR 65 at 68F. I accept the evidence of Mr Clarke. In my opinion reasonable care did not require that there should have been a barrier between the spa and pool, or that the spa should have been built some distance from the pool and should not have encroached upon it. This ground fails. 47 The plaintiff also alleged a failure to provide a safe and nonslip surface. It was agreed by the experts that the coefficient of friction of the tiles that formed the concourse and the tiling in the spa when measured at the time of the conference of experts did not breach usual practice. There is no evidence that anyone had slipped or fallen in that area (apart from Mr Ryan). The evidence does not establish the step or pool surrounds were slippery in the ordinary meaning of the word at the time they were examined. Additionally the parties agreed the pool was refurbished in about 1995 and evidence was given on behalf of the second defendant that the tiles laid by it in the pool/spa area had been replaced and that a lining had been added to the pool interior. I accept that evidence in preference to some contrary evidence given by statement by two of the plaintiffs' employees. As it is common ground that the refurbishment of the pool area took place in 1995 and thus prior to the plaintiff's injury, any deficiency in regard to the slipperiness of the tiles is not a matter for which the defendants could be held liable.

The plaintiffs' liability to Mr Ryan 48 The defendants relied upon the statement in respect of a claim under the Act made by Gummow J in Thompson v Australian Capital Television Pty Limited [1996] HCA 38; (1996) 186 CLR 574 at 616: "Nevertheless the party seeking contribution after such a settlement must be prepared in that proceeding to establish that, if the claim had been fought out, that party would have been held responsible in law and liable to pay in whole or in part for the damage referred to. The decision of the English Court of Appeal in Stott v West Yorkshire Road Car Co. [1971] 2 QB 651 which established these propositions with respect to the UK Act, has been followed in respect of Australian legislation deriving from it." 49 The breaches particularised by Mr Ryan against the plaintiffs in his amended statement of claim were essentially a failure to ensure that the risks arising from the acts and/or omissions of the defendants were obviated together with a failure to supervise or monitor activities in and about the pool/spa. The defendants accepted that the plaintiffs owed a duty of care to Mr Ryan. The issue was whether there was any breach of that duty and, if there was, whether such breach was causative of Mr Ryan's injury. 50 For the reasons given in relation to the question of breach by the defendants, the plaintiffs have not established that they were liable to Mr Ryan in respect of the spa. Nor does the evidence establish a failure to supervise or monitor activities in and about the pool/spa area. The evidence was that there was no "mucking around" by the team members and there was evidence from an employee of the plaintiffs that she was impressed by their demeanour and manners. In my opinion, the plaintiffs' claim also fails by reason of the plaintiffs' failure to establish that they were liable to Mr Ryan.

Direct liability for economic loss 51 The second basis for recovery advanced by the plaintiffs was a claim for pure economic loss based upon the principles in Perre v Apand Pty Limited (1999) 198 CLR 180 and Woolcock Street Investments Pty Limited v CDG Pty Limited (2004) 216 CLR 515. The plaintiffs were corporate owners and occupiers of commercial premises and had had eight years to assess the adequacy and safety of the defendants' works. They had had the works assessed for defects litigation shortly after construction and carried out renovation works in 1995. In my opinion, they were not relevantly "vulnerable" and the claim for pure economic loss is not maintainable. However, it is unnecessary to further consider this question as this claim would fail for the same reasons as the claim for indemnity or contribution under the Act has failed.

Verdict and judgment for the second defendant on the first defendant's cross claim with costs.

The plaintiffs to pay the defendants' costs. **********

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.

CITATION : Frisbo Holdings v Austin Australia [2010] NSWSC 155

Mercer v Commissioner for Road Transport and Tramways (NSW) (1936) 56 CLR 580 Makita (Australia) Pty Ltd v Spowle (2001) 52 NSWLR 705 RTA v Dederer (2007) 237 CLR 330 Chico v The Corporation of the City of Woodville (1990) Aus Torts Rep 81,028 Lanza v Codemo [2001] NSWSC 845 Wilkinson v Law Courts Limited [2001] NSWCA 196 CASES CITED : Chappel v Hart (1998) 195 CLR 232 Ellis v Wallsend District Hospital (1989) 17 NSWLR 553 Hoyts v Burns (2003) 201 ALR 470 Phillis v Daly (1988) 15 NSWLR 65 Thompson v Australian Capital Television Pty Ltd [1996] HCA 38; (1996) 185 CLR 574 Perre v Apand Pty Ltd (1999) 198 CLR 180 Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515

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