Kingsgrove RSL v Spasevski [2002] NSWCA 342 | Case summary

Judgment 1 HANDLEY JA: For some years prior to August 1994 the respondent, Mrs Gail Spasevski, was employed by the appellant as a bar stewardess in its bowling clubhouse (the clubhouse) at 58 Mooresfield Road, Kingsgrove. She worked shifts of 4½ to 5 hours from 3 in the afternoon to early evening. The bowling club had formerly been independent but by 1989 it had ceased to be viable on its own and had amalgamated with the appellant which was a much larger club. 2 On Thursday evening 18 August 1994 about 9 pm two female employees, the respondent and her supervisor, were on duty in the clubhouse. Two patrons were still present and the respondent had just let a third out through the northern door, which she had closed. She was returning to the bar area when she noticed an armed man wearing a balaclava running towards her in a frenzy. He pushed her further away from the door and demanded to know where the patron was. The respondent said he had gone and she was alone. She was herded back to the bar area. Some minutes later, after she had had a gun held to the back of her head, the two patrons and the two staff were forced into the strongroom and told not to come out or they would get their heads blown off. The door was closed and they stayed there in the dark until the police arrived. The respondent said that the two patrons had been caught at the door by the robbers and moved back inside (AB 13). 3 She was interviewed by the police and after about an hour was driven home by the club manager. She was traumatised by her experience and suffered from post traumatic stress disorder. She has not worked since. 4 The respondent brought proceedings in the District Court against her employer alleging a breach of its duty of care to her as its employee. Her case was based on its failure to take reasonable care to deter or prevent armed robberies at the clubhouse, particularly after an armed robbery on 30 July only 19 days earlier (the second robbery). 5 The action was tried before Sorby DCJ who found in her favour and entered judgment for $350,152.60. The club has appealed on grounds relevant only to liability. 6 Mr Hislop QC, who appeared for the appellant, conceded that it owed a relevant duty of care and that an armed robbery was reasonably foreseeable. He confined his submissions to challenging the judgment on the issues of negligence or breach of duty and causation. 7 The clubhouse was secluded (107), in an isolated position out of sight of the main clubhouse, which was about 1 km away or more. It was about the length of a football field back from Mooresfield Road. The bowling club's land was surrounded by Clemton Park on its southern and western sides. A single armed robber had held up the premises at 6.30 pm in daylight in December 1989. The second armed robbery occurred at 9 pm on Saturday 30 July 1994. On that occasion two club employees, the supervisor Mr Harrigan and Mrs Lattouf, had locked up and left when they were confronted by three men in balaclavas armed with shotguns and forced back into the clubhouse. 8 The respondent's case was that, following this robbery, the appellant failed to take reasonable steps to protect its employees, such as herself, from being injured by another armed robbery. 9 After the two clubs amalgamated in 1989, steps were taken to improve security at the clubhouse. A 10 ft chain wire fence topped with barbed wire (149) was erected on three sides of the property with a gate, which could be locked, on the south giving access to the netball courts in the park. On the north there was a U-shaped driveway and carpark with an entrance from and exit to Mooresfield Road. The entry and exit roads could be barred by locked chains, but there was no barrier to pedestrian access. 10 The clubhouse had doors on its northern, eastern and western sides. Those on the west and north were fire doors which could only be opened from the inside. Normal access was through the eastern door, but this was not visible to staff in the bar area where the poker machines were located (41). There was normally no one on duty who could watch this door (102). On most days the gate in the fence and the chains across the entrance and exit roads were locked half an hour to an hour before dusk. The clubhouse remained open later on Thursday, Friday and Saturday nights when the gates were locked at about 7.30 (99). There were hold up alarms in the office, the bar and the strongroom and an intruder alarm which was turned on when the staff left (99, 150). The supervisor was supposed to have a hand-held alarm which could be activated anywhere (150), but it seems that Mr Harrigan did not know about this (99). 11 After the first robbery in 1989 the management took steps to improve security at the clubhouse. Security advisers were consulted and on their advice the security fence and the alarms were installed and the doors altered to restrict access to the eastern door where the greens were not in use (149-150). These were the security arrangements at the time of the second robbery. There were no security guards on patrol or on duty after dark, at closing time, or indeed at any time. 12 The plaintiff said that she had been given no instructions on how to act in a hold up, or as to the whereabouts of the hold up alarms (15). She did not know of their existence (37). The Judge accepted her evidence. Mrs Lattouf, who was on duty at the time of the second robbery, gave similar evidence (92-3). The plaintiff was not aware of any changes in the security arrangements after the second robbery (40) and Mrs Lattouf was not aware of any changes either (95). However she was away from work quite a lot after the second robbery, and then only worked a short time at the clubhouse before being transferred to the main clubhouse (94-5). 13 Mr Harrigan confirmed the evidence of the plaintiff and Mrs Lattouf about the security arrangements and the absence of instructions on how to act in a hold up (98). He said that there were no changes in the security arrangements in the interval before the third robbery (99). There was a direction to be more stringent in following existing procedures (105-6), but Mr Harrigan said these were being followed anyway. 14 Mr Stevenson, who had been the General Manager of the club for 25 years before his retirement in 1998, said that after the second robbery the club's management took expert advice and increased the security arrangements at the clubhouse, but the Judge found "that between the two robberies the defendant had done nothing to improve security at the club". The Judge said that the principal allegations of negligence relied on by the plaintiff were the defendant's failure, after the second robbery, to provide any security guards in the foyer of the clubhouse or outside and its failure to reassess the security arrangements. 15 Mr Stevenson said that after the third robbery the club's Board held a special meeting and decided to close the clubhouse earlier on Monday, Tuesday and Wednesday evenings at 6 pm, at 7 pm on Thursday, and a little later on Friday and Saturday. He said (156): "… the whole idea was it was to be closed while there were still patrons in the club and the duty supervisor would leave with the patrons. They would then ring down and say we're closing and then we'd ask them to come down to the main club with the keys. All the steps were brought in immediately following the August hold-up". 16 He also said that the club engaged a local security firm, Black Knight, who provided a security guard who would come around at various times of the night (163) at a cost of $50 an hour (163-4). The club employed doormen at the main clubhouse but management could see no reason to have a doorman at the clubhouse (161), because the bowling club could not afford this for 20 customers (163), and it had always run at a loss (152). 17 The plaintiff tendered a report by Mr Jennings, a security expert, who gave oral evidence. He stated in his report (186) that police were of the opinion that the second and third robberies were committed by the same offenders, one of whom was an escapee from jail in Queensland, who had been serving a sentence for murder. He stated that very few crimes are committed, particularly armed robberies, without the criminals having researched the target and judged the prospects of being able to complete the crime with minimal resistance and a reasonable chance of escaping without detection or apprehension (189). He stated: "… the presence or otherwise of visual crime deterrents or preventative systems can play a major part in what is generally called the softening or hardening of the target. The hardening of a target is the introduction of such security measures as would place the success of the crime in some doubt in the criminals' mind, thereby making them change their target to one where the benefits are similar but the success potential is higher … The principle of visual deterrents is to make any secure practice obvious to potential offenders … A major contributory factor in such visual crime deterrent is the placement of uniformed security operatives in the foyer and/or close to the centre of financial management". 18 Mr Jennings continued (191): "As the two incidents at this club … occurred just 18 days apart it is apparent that the offenders had not only noticed prior to 30 July … that the systems in place made this club an easy target … They were apparently aware that the defendant had not made any material change to the security/safety systems following the July robbery … It is common with many robbery targets … to have a review carried out of security immediately following a robbery and during … the review … some interim security upgrade [is] placed on the operation. Such an interim measure could entail the placement of a guard on the subject site … particularly during those times when a recurrence was possible. Recurrence of crimes of this type are relatively rare, … the lack of upgrade would have been noticed by the criminals and as … the same criminals carried out both robberies [they] would have seen the very easy opportunity to gain from this lack of upgraded security/safety systems in the 18 day period". 19 His conclusions were (192): "… the defendant … failed to learn the lesson from the first robbery and activate some urgent upgrade or temporary remedy until such could be organised. If such an upgrade had been completed then the second robbery would almost certainly have not taken place …". 20 He said in his oral evidence that there was no such thing as one hundred percent security (144). The trial Judge said in finding that liability had been established: "… the defendant club had the power to control … the system of work of the plaintiff and employ security staff, albeit part-time at an hourly rate, to patrol the club's premises at the relevant times and thus afford some protection to its employees … By not employing security staff before the robbery, the defendant had not provided a safe system of work and not ensured reasonable care was taken". 21 The appellant submitted that the Judge erred because he found it liable without finding that its breach of duty had caused the plaintiff's injuries. Even if a finding of causation was to be implied, the club submitted that his Honour failed to give any reasons for that finding and there had to be a new trial. In any event it was said that the finding of negligence or breach of duty could not be supported because there was no evidence that anything the club could have done would have prevented the third robbery. 22 The Judge found that the club should have employed security staff. His further statement "and thus afford some protection to its employees" reflects an implicit finding that causation had been established. 23 In cases such as the present, where the breach of duty involves an omission, the Court must decide the question of duty before deciding the question of causation. Mr Jennings' evidence established that the club should have attempted to deter would be robbers, particularly those who had committed the second robbery, by visibly upgrading its security arrangements. The appropriate way to do this was to engage a security guard who would be as conspicuous as possible. Would be robbers would notice this but would not know what else might have been done to improve security. 24 Mr Jennings' evidence, by report and orally, was clear and consistent until his final answer in re-examination. As he said during cross-examination (137): "A security guard is not there to carry out some physical confrontation with an armed robber". He was there to deter would be robbers so that they would chose a softer target elsewhere. His evidence in re-examination was as follows (145): "Q. You were talking about the presence of an unarmed guard or security agent? A. Yes. Q. At the club and the effect of that unarmed person being capable of, I suppose, dealing with the situation when he's confronted, when the club is confronted by armed intruders. What is the significance of the deterrent effect of having a person with a uniform in and about the premises such as this one? A. Yes. The effect upon the criminals is there will be some element of deterrence primarily to the less sophisticated criminals who are intent upon some spontaneous type of crime where they will see a uniformed person as being a stat which think have to confront (sic). I am not talking about that being a deterrent to a number of persons with firearms. It probably would not be at all, that is not his job". 25 I do not read this as a retraction of his earlier evidence. In my judgment Mr Jennings understood the last question to be directed to the situation "when the club is confronted by armed intruders". He said by that stage there would be no deterrent effect. The thrust of his earlier evidence had been the need to deter such persons when they were reconnoitring the premises and deciding whether to attempt a robbery or a further robbery. 26 Although the trial Judge does not refer to Mr Jennings by name, the findings already quoted [par 20] involve an acceptance of his earlier evidence and a finding that this last question and answer did not involve its wholesale retraction. He was in a position of special advantage in assessing the effect of the re-examination and in my judgment it provides no basis for disturbing the Judge's implicit finding that causation had been established. 27 Mr Harrigan said in cross-examination (107) that a security guard at the clubhouse at night "wouldn't deter, it really wouldn't". When the cross-examiner returned to this topic a few questions later the plaintiff's counsel successfully objected to the question, presumably on the basis that the witness was not qualified to express such an opinion. The Judge was entitled to disregard the earlier answer as he evidently did. 28 The club called no expert evidence although it had retained Wormald and later Chubb throughout the 90s to advise on security matters. In my judgment therefore the trial Judge was entitled to find that a breach of duty had been established. 29 The duty of an employer in cases such as this, although well established, is unusual. In Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254, 265 Gleeson CJ said: "… there are circumstances where the relationship between two parties may mean that one has a duty to take reasonable care to protect the other from the criminal behaviour of third parties, random and unpredictable as such behaviour may be. Such relationships … include those between employer and employee … But the general rule that there is no duty to prevent a third party from harming another is based upon a more fundamental principle, which is that the common law does not ordinarily impose liability for omissions". 30 The parties in cases such as the present cannot be expected to call the criminals to give evidence on the issue of causation, even if they could be traced and were willing to give evidence. Their evidence would be unreliable and worthless. Proof of causation where the risk to be guarded against involves the "random and unpredictable" behaviour of criminals is intrinsically difficult, but the law does not leave the tribunal of fact without appropriate guidance. In Bennett v Minister of Community Welfare (1992) 176 CLR 408, 420 Gaudron J said: "… a case based on omission or a failure to act will … fall for analysis in a way that differs from that appropriate for a case based on a positive act. Thus in the case of a positive act questions of causation are answered by reference to what, in fact, happened. In the case of an omission, they are answered by reference to what would or would not have happened had the act occurred. In that exercise … the issue is approached on the basis that 'when there is a duty to take a precaution against damage occurring to others through the default of third parties … breach of the duty may be regarded as materially causing or materially contributing to that damage, should it occur, subject of course to the question whether performance of the duty would have averted the harm' (Sutherland Shire Council v Heyman ( 1985) 157 CLR 424, 467 per Mason J)". 31 Gaudron J continued her analysis at 421-2: "There are two aspects to the question whether performance of a duty would have averted the loss or injury suffered. The first is the general sufficiency of the duty to avert or prevent harm of the kind in issue. The second involves a consideration of what would or would not have happened in the particular circumstances of the case. … it is not always necessary to consider the second aspect … so far as general sufficiency is involved in the question of causation there is usually no reason to separate or distinguish the question of breach of a common law duty from that of causation. That is because a duty is imposed by the common law by reason that it is a precaution which a reasonable person … would have taken to prevent a foreseeable risk of harm of the kind suffered. Thus questions of the sufficiency of the precaution to avert the harm are inevitably subsumed in the finding that there was a duty: a precaution is not classified as 'reasonable' unless it can be said that its performance would, in the ordinary course of events, avert the risk that called it into existence". 32 This analysis has been applied in later cases. In Chappel v Hart (1998) 195 CLR 232, Gaudron J (238-9), McHugh J (247) and Gummow J (257) held that a breach of a duty to take specific precautions, followed by an accident of a kind that might thereby be caused, supported an inference that the breach caused the accident in the absence of some sufficient reason to the contrary. See also Naxakis v West General Hospital (1999) 197 CLR 269 at 278-9, and Rosenburg v Percival (2001) 205 CLR 434 at 452 per Gaudron J and at 460-1 per Gummow J. 33 It follows in my judgment that the Judge's implicit finding on causation was open on the evidence. That being so the Court can draw the inference with greater confidence because the club did not call evidence from its security consultants. The Judge did not give reasons for his implicit finding beyond accepting the evidence of Mr Jennings that the employment of security staff would have afforded "some protection" to the plaintiff. 34 In some cases the failure of a trial Judge to give reasons for an important finding will necessitate an order for a new trial. Typically this will occur where there were conflicts of evidence and findings on credit were required to explain and support the decision. In the present case the only expert evidence on liability and causation was that of Mr Jennings and it is clear that the Judge accepted his evidence. No question of credibility arises. Under s 75A of the Supreme Court Act this Court can rehear the case, review the evidence, draw inferences and make findings of fact which will provide the necessary reasons. Compare Warren v Coombs (1979) 142 CLR 531. There is therefore no need for a new trial. 35 There is no certainty that the employment of security guards would have prevented this robbery but the evidence of Mr Jennings establishes that security guards should have been employed to deter potential robbers and in particular those who had carried out the second robbery. 36 After the second robbery the club's duty to its employees, including the plaintiff, was to take reasonable steps to protect them from being injured as a result of a further robbery. In breach of that duty it did nothing to upgrade security. To all outward appearances the existing inadequate security arrangements remained unchanged and the clubhouse remained the softest of targets. According to Mr Jennings this practically guaranteed a return visit from the robbers who had carried out the second robbery. 37 The trial Judge did not find that the club's failure to close the clubhouse earlier in the evenings was a breach of duty. Mr Hislop submitted that this allegation had not been particularised and was not available to the respondent, but it was covered by particular (f) in the statement of claim: "Failure to make any or any material change to the security/safety system following an armed robbery on 30 July 1994". 38 Evidence was led without objection that the club was closed earlier in the evenings after the third robbery. Even if this evidence fell outside the particulars, once it was admitted it was available to support the plaintiff's cause of action as pleaded. See Leotta v Public Transport Commission of NSW (1976) 50 ALJR 666 and Water Board v Moustakas (1988) 180 CLR 491, 497. No question of credibility arises and there is no reason why this Court should not find that the club was negligent, after the second robbery, in failing to close the clubhouse earlier. 39 On the night of the third robbery the club had been kept open until 9 pm when only three patrons were still present and the robbers waited until then. It is a reasonable inference that the robbery would not have occurred if the clubhouse had been closed at 7.30 or 8 pm when more patrons were present. 40 After the third robbery the club acted promptly by engaging security guards and closing the clubhouse earlier in the evening. These measures proved successful and the persons who had carried out the second and third robberies did not return and there was no further robbery for over two years. It is a reasonable inference that more probably than not these additional security measures would have been effective if they had been implemented after the second robbery. 41 If the Court declined to find causation in cases like this because of the difficulties of proof the employer's duty to take additional security measures would lack effective content. The duty would not be enforceable because the employer could ignore it with impunity. See McGhee v National Coal Board [1973] 1 WLR 1 at 9 per Lord Simon of Glaisdale and at 12 per Lord Salmon. Compare Wilsher v Essex Area Health Authority [1988] AC 1074, 1090-1 per Lord Bridge. 42 The approach of Gaudron J and other High Court Judges, which has been referred to [pars 30-2], places an evidentiary onus on the party in breach of duty. The breach of duty has created difficulties of proof which would not exist if the duty had been performed. Evidentiary presumptions are available against wrongdoers for other legal purposes (Armory v Delamirie (1722) 1 Stra 505 [93 ER 664] and Houghton v Immer (No 155) Pty Ltd (1997) 44 NSWLR 46 at 49) and I see no reason why such a presumption should not be available in cases such as the present. This provides a further basis for finding that the club's breaches of duty caused or materially contributed to the respondent's injury. 43 For these reasons I would uphold the Judge's decision on liability. The appeal should be dismissed with costs. 44 SHELLER JA: I agree with Handley JA. 45 HODGSON JA: I agree with Handley JA.

Kingsgrove RSL v Spasevski

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