Sydney City Council v West

[1965] HCA 68

High Court of Australia|1965-07-01|Before: Windeyer JJ, Taylor J

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Source facts

Court

High Court of Australia

Decision date

1965-07-01

Before

Windeyer JJ, Taylor J

Source

Original judgment source is linked above.

Judgment (58 paragraphs)

[1]

High Court of Australia Barwick C.J. Kitto, Taylor, Menzies and Windeyer JJ. Sydney City Council v West [1965] HCA 68

[2]

At about 8.20 a.m. on 15th December 1961 the respondent left his motor-car - registered number BYU 242 - at the Domain Parking Station in a place indicated to him by an attendant and he has not seen it since. Shortly after 6 p.m. it was found to be missing from the place where it had been parked and it was said that a search of the station failed to discover it. Consequently it was not redelivered to him. The parking station was owned and operated by the appellant and in August 1962 the respondent commenced proceedings in a District Court in which he claimed to recover damages for the defendant's breach of an alleged promise "to safely keep and take care of the said motor vehicle whilst the same should be in the defendant's care and keeping as aforesaid, and to redeliver the same to the plaintiff on request". Additionally he sued the appellant in detinue and claimed a return of the car or, alternatively, its value. The action was heard before a jury but no issue of fact was left to them for at the conclusion of the evidence the learned District Court Judge directed a verdict for the appellant. In doing so he accepted the respondent's contention that the only conclusion open on the evidence was that the relationship created between him and the appellant was that of bailor and bailee and not merely that of licensee or licensor but he held that the contract of bailment contained a clause which, in the circumstances of the case, exonerated the appellant from liability. However upon appeal the Full Court of the Supreme Court took a different view of the effect of this clause and directed a new trial: West v. Sydney City Council [1] .

[7]

However this is by the way for we do not think that the evidence adduced by the appellant at the trial showed that the loss was of a description which fell within the exempting clause and special leave to appeal was granted, in effect, upon the condition that if this Court should so hold, the appellant would consent to judgment for the plaintiff in the District Court for the sum of £1,300. The ticket upon which the clause appeared was described by the Full Court in the following passage: "The parking ticket received by the plaintiff on 15th December 1961 was tendered and marked Exhibit "A". This comprises an oblong card which at its top bears a space for the time and date of the entry of the vehicle and of its departure to be inserted by the defendant's employees and this is apparently necessary because the parking charges vary in accordance with the number of hours or part thereof that the vehicle remains in the parking station. Immediately beneath these times appear the following words: "This card must be presented to attendant to obtain release of vehicle." Lower down on this side of the card, after some printed matter which is not material hereto, appear three clauses with the heading "Parking Conditions". The second and third clauses relate respectively to the parking charges and the hours when the parking station is open. The first clause reads as follows: - "1. The Council does not accept any responsibility for the loss or damage to any vehicle or for loss of or damage to any article or thing in or upon any vehicle or for any injury to any person however such loss, damage or injury may arise or be caused." Beneath these three clauses and on the same side of the ticket appear these words: " Important. This ticket must be presented for time stamping and payment before taking delivery of the vehicle. Vehicles must be parked as directed by Attendant. Edw. Adams Town Clerk." On the other side of the ticket appear some words which do not appear to be material in this case relating in the main to certain services which are available for motorists at the parking station" [1] .

[11]

We find difficulties in the way of solving the problem in the manner in which it was solved by the Full Court. First of all we have some difficulty, as Devlin J. (as he then was) had in Smeaton Hanscomb & Co. Ltd. v. Sassoon I. Setty, Son & Co. [1] , in understanding precisely what is meant by the expression "fundamental term" and we find further difficulty in the illustration given by Denning L.J. when he denied the application of an exemption clause to a case where a warehouseman misdelivers goods left in his custody without excuse. There is no doubt, of course, that in the case where a contract of bailment contains an exempting clause much as we have to consider the protection afforded by the clause will be lost if the goods the subject of the bailment are stored in a place or in a manner other than that authorized by the contract or if the bailee consumes or destroys them instead of storing them or if he sells them. But we would deny the application of such a clause in those circumstances simply upon the interpretation of the clause itself. Such a clause contemplates that loss or damage may occur by reason of negligence on the part of the warehouseman or his servants in carrying out the obligations created by the contract. But in our view it has no application to negligence in relation to acts done with respect to a bailor's goods which are neither authorized nor permitted by the contract. For instance, if, in the present case, one of the attendants at the parking station had been allowed by the management to use the respondent's car for his own purposes and, in the course of driving it, had caused damage to it by his negligent driving, the clause would afford no protection. Negligence in these circumstances would be right outside the purview of the clause. The same result would follow if an attendant had proceeded, without authority, to make adjustments or repairs to the respondent's vehicle while it was in the parking station and had carried out such work negligently and thereby caused damage. To our minds the clause clearly appears as one which contemplates that, in the performance of the Council's obligations under the contract of bailment, some loss or damage may be caused by reason of its servants' negligence but it does not contemplate or provide an excuse for negligence on the part of the Council's servants in doing something which it is neither authorized nor permitted to do by the terms of the contract.

[12]

How then is the question of liability to be resolved in the present case? The appellant has sought to explain the loss of the car by evidence which, upon a trial, would probably be accepted. Of course, if it were not, the loss would remain unexplained and the respondent would be entitled to recover. It is, therefore, necessary to consider the question whether the loss, in the circumstances deposed to, was a loss resulting merely from the failure on the part of the appellant to use reasonable care to keep the car safely whilst it was in its possession as a bailee or whether by some positive act the appellant can be said to have delivered possession of the car to "Robinson". If it did then, in our view, this constituted an unauthorized act performed by the appellant in relation to the respondent's car and he is entitled to recover. But in order to solve this problem some addition should be made to the evidence already mentioned. In order to drive out of the parking station "Robinson" had to pass through a designated exit where an attendant was stationed and it was this official's function to permit vehicles to proceed only upon the surrender by the driver of an appropriate parking ticket. It was such a ticket which, as was said by the superintendent of the parking station, entitled "a person to go into the parking station and drive a car out of the parking station after handing that ticket in to the attendant at the exit". The parking ticket was his "entrance card into and out of the parking station". Possession of any car leaving the station, it seems to us, was, therefore, retained by the appellant until presentation and surrender of such a ticket by the driver of the car. To our minds, therefore, the act of the attendant in permitting "Robinson" to proceed after handing over the duplicate ticket which he had obtained constituted an unauthorized delivery of possession by him to "Robinson" and not a mere act of negligence in relation to some act authorized by the contract of bailment. On this aspect of the case the appellant relied strongly upon the case of Ashby v. Tolhurst [1] but that case has been treated as a case where the defendant's default was mere negligence or inadvertence (see Sze Hai Tong Bank Ltd. v. Rambler Cycle Co. Ltd. [2] and is plainly distinguishable on the facts from the present case.

[18]

The respondent said that he returned after an absence of nearly ten hours, presented the ticket, and paid the amount due to an attendant who stamped the ticket with the time (6.8 p.m.), the amount of the charge (6s. 6d.) and a receipt for that amount. He then looked for his vehicle but it was missing and has never been found. He had used the parking station quite regularly, he said, and knew the system, including the procedure as to the ticket. He knew that there was writing on the ticket but not what it was. If the evidence down to this point - and I have stated it, of course, in summarized form - were accepted, but it were found that the contract did not include the protective clause, the respondent would be prima facie entitled to a verdict. A contention advanced for the appellant that the relationship shown by the evidence was no more than that of licensor and licensee could not be sustained; indeed it was not reasonably open to the jury to conclude that the appellant merely granted the respondent a licence to leave his vehicle on the appellant's land. The only inference that could properly be drawn would be that a contract of bailment was made between the parties under which the appellant was to have possession of the vehicle until the respondent should request its redelivery to him, present the ticket and pay the charges. The jury could not reasonably refuse to find that there was an implied promise by the appellant to the effect that upon the respondent's doing the three things mentioned the right to possession would revert to the respondent and he would be entitled to drive the vehicle away. But the question would remain whether this implied promise was subject to the express term appearing in the first clause of the "Parking Conditions" on the ticket; and that was a question for the jury: Richardson, Spence & Co. v. Rowntree [1] . They would have to be directed in accordance with the law as laid down in Parker v. South Eastern Railway Co. [2] ; but in my opinion they might well have concluded that the appellant had taken steps which in all the circumstances were reasonably sufficient to give the respondent notice of the condition, and if so the protective clause was a term of the contract.

[24]

The first of these considerations makes it proper in some cases of bailment to conclude that liability for loss caused by negligence of the bailee or his servants is not intended to be covered by a protective clause. This is so where in the absence of such a clause a judgment holding the bailee liable for loss of the bailed chattel might have been put upon other grounds as well as a failure in the duty of care and skill: Davis v. Pearce Parking Station Pty. Ltd. [2] . But where the only liability would have been for negligence, it is necessarily against that liability that the clause is intended to give protection. The rule has long been settled which Scott L.J. explained in Beaumont-Thomas v. Blue Star Line Ltd. [1] : "In order to construe any exception of liability for events happening in the performance of the contract, where the words of the exception are not so clear as to leave no doubt as to their meaning, it is essential first to ascertain what the contractual duty would be if there were no exception. In the contract of a common carrier by land, or of a shipowner for the carriage of goods by sea, broadly speaking, the carrier is an insurer of the safe delivery of the goods. If they are damaged on the way, he is liable. That is his primary duty. There is also a secondary duty, however - namely, the duty to use skill and care. That duty comes into play in case of the carrier invoking some term of an exception clause as a protection against liability. In such a case, if the excepted peril has been occasioned by the negligence of the carrier's servants, the failure to perform the secondary duty debars him from reliance upon his exception. In the case of a carrier of passengers, no such double liability attaches. He is under a duty to use due skill and care, and no more. The absolute duty of the goods carrier to keep and deliver safely does not apply. This fundamental difference in the basic contract caused the common law courts of England during the last 100 years to make a difference in the interpretation of general words of exception from liability according as the contract to be construed was one imposing the double duty or only the one duty" [2] . Goddard L.J. in the same case stated the rule succinctly thus: " first of all, find what is the nature of the liability which, but for the exception, would rest on the person for whose protection the clause exists. If such liability arises only where there is a lack of due care and skill, it follows that a clause exempting that person from liability exempts him from the consequences of his negligence" [3] .

[29]

A valuable discussion of these principles or doctrines is to be found in Dr. Brian Coote's recently published book Exception Clauses (1964). It may well be important in some circumstances to decide as a matter of juristic analysis whether the operation of a protective clause is, as Dr. Coote would maintain, to qualify the bailees's obligations under the contract so that there is no breach where the clause applies, or is merely to provide a shield against liability in damages for breach of obligations which stand unqualified by the clause. But in the present case what is important, I think, is to recognize that the evident purpose of the clause is to free the appellant from all the responsibility (for loss and damage) to which otherwise its assumption of the position of bailee would have subjected it. The clause is part and parcel of the bargain by which the bailment was created and the reciprocal rights and obligations of the parties as bailor and bailee were regulated. The concern of the clause, as read in the setting in which it came to be agreed upon (assuming that it was agreed upon), was with the legal responsibility which the appellant's acceptance of the bailment should entail. Consequently, to construe it as precluding liabilities to which performance or non-performance of a bailee's ordinary obligation of care would be irrelevant would be to extend it beyond anything the parties could have had in mind. Had they been asked at the time of the contract whether the clause related to any liability unconnected with the legal incidents of the bailorbailee relationship I should think they would certainly have replied: "Of course not": cf. Sze Hai Tong Bank Ltd. v. Rambler Cycle Co. Ltd. [1] . The clause, therefore, precludes liability for loss or damage caused by a breach of the duty of care which ordinarily falls upon a bailee in like circumstances, but affords no defence, in my opinion, to claims upon which, if the clause had been omitted from the contract, there could not have been an issue raised as to whether due care and skill had been exercised. It is for this reason, I think, that the clause would have no application to a claim in respect of damage resulting from an unauthorized interference with the vehicle by a person for whose acts the appellant is responsible.

[55]

The clause is in very wide terms, although its place under the heading "Parking Conditions" and in conjunction with the other conditions there stated may be some indication that it relates, at all events primarily, to loss or damage occurring while the vehicle is in the station. However that may be, it would, I think, cover any loss by explosion or fire occurring on the premises and probably too any loss by theft which did not involve an actual release or delivery of the vehicle to a person not presenting the card. It would also, I do not doubt, cover damage to the vehicle while on the premises caused by the negligence of the appellant's servants, or by the negligence or deliberate intent of some other person for example another user of the service station. But I doubt whether it should be read as extending to harm done deliberately by a servant or agent of the appellant for which the appellant would ordinarily be vicariously liable. However that may be the clause, whatever its exact extent, obviously can have a wide field of operation without curtailing the express provisions of the contract relating to the delivery of the car on the termination of the bailment. The principle that Scrutton L.J. enunciated in Gibaud v. Great Eastern Railway Co. [1] , referred to in the House of Lords in London and North Western Railway Co. v. Neilson [1] , is in point. His Lordship said that " if you undertake to do a thing in a certain way, or to keep a thing in a certain place, with certain conditions protecting it, and have broken the contract by not doing the thing contracted for in the way contracted for, or not keeping the article in the place in which you have contracted to keep it, you cannot rely on the conditions which were only intended to protect you if you carried out the contract in the way in which you had contracted to do it" [2] . In this case the contract was broken because the appellant did not do the thing it had contracted to do in the way in which it had contracted to do it. The respondent's cause of action could I think be appropriately formulated by averments that the appellant had, for reward, promised the respondent to undertake the custody of his vehicle and to release it from its said custody upon presentation of the card and not otherwise, yet without the card being presented released it, whereby it was lost. And, the loss having thus occurred, an action would also lie in detinue: Jones v. Dowle [3] .

[57]

I am therefore of opinion that this appeal should be disposed of in the way that the Chief Justice and Taylor J. propose in their judgment which I have had the advantage of reading. I reach the same conclusion as do their Honours, but by a somewhat different, and perhaps narrower route. That does not mean, however, that I might not in another case be ready to follow their path. Much depends in every case upon the precise meaning of the words that the parties used read in their context and circumstances; for the question, as I see it, is one of interpretation. It is not for a court to say that persons may not contract out of the obligations that the law of bailment imposes, or put new limits on their power to do so. The question for a court is only whether they have done so. The answer to that question, in a case such as this, depends upon the ascertainment of two matters: whether the writing on the ticket in fact formed part of the contract: if so, what is its meaning. The ordinary duties of a bailee to exercise due care both to keep an article securely while in his custody and to return it to the bailor at the conclusion of the custody are not rigidly separable. It may be that the reason why they have so often been separately stated is that the remedy for breach of the former was in assumpsit or case and for the enforcement of the latter detinue lay: see Paterson v. Miller [4] , especially per Cussen J. [5] . But the distinction between the two duties can be important. It was adverted to by Scott L.J. in Ashby v. Tolhurst [1] where he spoke of "the position of a bailee who may protect himself by clauses of exception from his ordinary obligation as a bailee in respect of care in safe custody, and yet still be liable if he misdelivers at the end of the contract of bailment, unless he has covered himself by very carefully chosen words". Far from choosing words that would clearly exonerate it from liability for the consequences of a misdelivery, the appellant here expressly introduced into the contract a term designed to ensure that there would not be a misdelivery, and this term it broke. I would therefore dismiss the appeal.