adeels palace pty ltd v moubarak 239 clr 420

8/10/2019 Adeels Palace Pty Ltd v Moubarak 239 CLR 420

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ADEELS PALACE PTY LTD.. .......................... APPELLANT;DEFENDANT,

AND

MOUBARAK.. ..................................................... RESPONDENT.PLAINTIFF,

ADEELS PALACE PTY LTD.. .......................... APPELLANT;DEFENDANT,

AND

BOU NAJEM........................................................ RESPONDENT.PLAINTIFF,

[2009] HCA 48

ON APPEAL FROM THE SUPREME COURT OF NEW SOUTH WALES

Negligence Duty of care Breach Causation Licensed restaurant Shooting of customers at overnight function Whether licensee owedduty to prevent injury from violent conduct of other customers Whetherlicensed security personnel should have been provided Statutoryrequirements that negligence be necessary condition of occurrence of theharm and that it is appropriate for scope of negligent persons liability toextend to harm so caused Relevance of statutory licensing provisionsrequiring liquor harm minimisation Liquor Act 1982 (NSW), ss 2A,

103, 125(1) Civil Liability Act 2002 (NSW), ss 5B, 5C, 5D.

Section 2A of the Liquor Act 1982 (NSW) stated that the minimisationof harm associated with misuse and abuse of liquor (such as harm arisingfrom violence and other anti-social behaviour) was a primary object of theAct and that all persons having functions under the Act were required tohave due regard to the need for liquor harm minimisation when exercisingthose functions. Other provisions of that Act required a licensee not topermit on licensed premises any indecent, violent or quarrelsome conductand permitted a licensee or an employee of a licensee to refuse to admit tolicensed premises, or to turn out, any person who was then violent,quarrelsome or disorderly.

Section 5A of the Civil Liability Act 2002 (NSW) provided that Pt 1Aof that Act governed liability for damages for harm resulting fromnegligence. Part 1A included ss 5A-5D. Sections 5B and 5C set out the

principles for establishing that a breach of duty had occurred. Section5B(1) provided that a person was not negligent in failing to takeprecautions against a risk of harm unless: (a) the risk was foreseeable

HC of A2009

Sept22, 23;Nov10

2009

French CJ,Gummow,

Hayne,Heydon andCrennan JJ

420 COMMONWEALTH LAW REPORTS [2009


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(that is, it was a risk of which the person knew or ought to have known),and (b) the risk was not insignificant, and (c) in the circumstances, a

reasonable person in the persons position would have taken thoseprecautions. Sub-section (2) provided that in determining whether areasonable person would have taken precautions against a risk of harm,the court was to consider the following (amongst other relevant things):(a) the probability that the harm would occur if care had not been taken,(b) the likely seriousness of the harm, (c) the burden of taking precautionsto avoid the risk of harm, (d) the social utility of the activity that createdthe risk of harm. Section 5D set out general principles for establishingcausation. Section 5D(1) provided that a determination that negligencecaused particular harm comprised the following elements: (a) that thenegligence was a necessary condition of the occurrence of the harm(factual causation), and (b) that it was appropriate for the scope of thenegligent persons liability to extend to the harm so caused (scope ofliability).

Two customers of a licensed restaurant and function centre sued theproprietor of the business for negligence in not having prevented theirbeing seriously injured by shooting by another customer. The incidentoccurred at a New Years eve function. A violent fight broke out when awoman customer accused another of brushing her hand with a lightedcigarette. One man involved in the fight was hit in the face, drawingblood. He left the premises and returned soon after with a gun. Hefollowed one customer into the kitchen and shot and wounded him. Hewent back to the restaurant area and shot and wounded the customer whohad previously hit him. There were no security personnel on the premises.

Held, (1) that, particularly in the light of the liquor harm minimisationprovisions of the Liquor Act, the proprietor owed the plaintiffs a duty totake reasonable care to prevent injury to customers from the violent,quarrelsome or disorderly conduct of other persons.

Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR

254, distinguished.(2) That the question of causation was governed by s 5D of the Civil

Liability Act. The element of factual causation was to be determined byasking whether the harm would have occurred but for the negligent act oromission alleged (the but for test). It had not been established on thebalance of probabilities that but for the absence of security personnel toact as crowd controllers, the shootings would not have taken place: theabsence of security personnel was not a necessary condition of theplaintiffs being shot.

Chappel v Hart(1998) 195 CLR 232, distinguished.

(3) That even if the presence of security personnel at the door mighthave deterred or prevented the person who shot the plaintiffs fromreturning to the premises and even if security personnel on the floor mighthave been able to intervene in the incident that broke into fighting in timeto prevent injury to anyone, neither matter was reason enough to conclude

that this was an exceptional case within s 5D(2) where responsibility forthe harm should be imposed on the proprietor. To impose thatresponsibility would not have accorded with established principles.

Per curiam. Whether a breach of duty of care occurred depended uponthe matters set out in s 5B of the Civil Liability Act, in particular whether

421239 CLR 420] ADEELS PALACE PTY LTD V MOUBARAK


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a reasonable person in the position of the proprietor would have providedsecurity personnel. Whether the provision of any and how many security

personnel should have been provided depended on the considerationsidentified by s 5B(2). Whether a reasonable person would have takenprecautions against a risk is to be determined prospectively. The answer ina particular case turns on the facts of the case that are proved in evidence.Hence deciding the question of breach in these cases would not establishany general rule about when or whether security personnel should beengaged by the operators of licensed premises.

Decisions of Supreme Court of New South Wales (Court of Appeal):Adeels Palace Pty Ltd v Moubarak[2009] Aust Torts Reports 81-997,reversed.

APPEALSfrom the Supreme Court of New South Wales.Anthony Moubarak and Antoin Fayez Bou Najem sued Adeels

Palace Pty Ltd in separate actions in the District Court of New SouthWales claiming damages for injuries sustained when they were shot ata function at licensed premises operated by the defendant on NewYears eve in 2002. The plaintiffs were customers at the function. Thegunman was also a customer. The plaintiffs claimed damages fornegligence and breach of contract. The actions were tried togetherbefore Judge Sorby. Judgment was given for Moubarak for$1,026,682.98 (which included interest) and for Bou Najem for$170,000. The defendant appealed from both judgments to the Court ofAppeal of the Supreme Court (Beazley, Giles and Campbell JJA)which dismissed the appeals (1). The defendant appealed to the HighCourt from the judgment of the Court of Appeal in both cases byspecial leave granted by Gummow and Hayne JJ. The respondents tothe appeals both filed notices of contention that the contract underwhich they had entered the premises was for the supply by acorporation in the course of a business of services to a consumer withins 74 of the Trade Practices Act 1974(Cth) and, accordingly, that therewas an implied warranty that the services would be provided with duecare and skill extending to security services to maintain order in thepremises and to protect those in the position of the respondents frompersonal injury caused by violent conduct by other persons on thepremises. The appeals were heard together.

J E Sexton SC (with him M J Gollan), for the appellant. ModburyTriangle Shopping Centre Pty Ltd v Anzil(2) decided that the duty ofcare owed by an occupier of land does not extend to taking reasonablecare to prevent injury resulting from the criminal behaviour of thirdparties on that land. That is because the relationship between occupierand entrant is not one of the special relationships for which there is anexception to the general rule that the law does not impose a duty to

prevent harm to another from the criminal conduct of a third party,even if the risk of such harm is foreseeable. The rationale is that

(1) Adeels Palace Pty Ltd v Moubarak[2009] Aust Torts Reports 81-997.(2) (2000) 205 CLR 254.



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criminal activity, including violent behaviour, is inherently irrationaland unpredictable and thus virtually impossible to prevent. Therationale for not including the relationship of occupier and entrant inthe special relationships is that (i) a duty to take steps to controlconduct should not be imposed if the person does not have the capacityto control it; (ii) it is unreasonable to require an occupier to controlcriminals because the acts of criminals result from choices which areunpredictable and not necessarily dictated by reason or prudentialconsideration; (iii) although the power to control who enters andremains on premises is one of the factors which establishes therelationship between all occupiers and entrants which gives rise tosome duty of care, that type of control and the power to act so as tomake the occurrence less likely is not enough to impose liability forfailing to prevent unpredictable and irrational conduct; (iv) such a dutywould impose liability on an occupier when its contribution to the

occurrence, compared to that of the assailants, is negligible; (v) such aduty would shift financial responsibility for the consequences of crimefrom the wrongdoer to members of society who have little or nocapacity to influence the behaviour which caused injury; and (vi) theexistence of a foreseeable risk of criminal behaviour is not enough toimpose on an occupier a duty to prevent harm from the criminalbehaviour of a third party: that would be neither practical nor fair. Thecontention that a duty of care arose because of foreseeability of harmfrom the criminal activities of third parties and capacity to control thatactivity was rejected in the Modbury Triangle case (3). Before andsince the Modbury Triangle case, there have been decisions ofintermediate appellate courts that occupiers of both licensed andunlicensed premises owe such a duty in relation to violent criminalconduct by one patron against another (4). Most of those cases were

based on the capacity of an occupier to control access to (andcontinued presence on) the premises coupled with foreseeability ofviolence by the actual assailant. In most cases there was alsoknowledge that the assailant was intoxicated. There was no evidenceconcerning the propensity of the gunman in this case for violentbehaviour or other unlawful conduct. The finding that the appellantowed a duty of care is inconsistent with (i) the general principle that it

(3) (2000) 205 CLR 254 at 266-268, 293-294, 300; see alsoMitchell v Glasgow CityCouncil [2009] 1 AC 874 at 884, 886, 893, 903, 904, 905-906.

(4) eg, Chordas v Bryant (Wellington) Pty Ltd (1988) 20 FCR 91; Wormald vRobertson[1992] Aust Torts Reports 81-180; Oxlade v Gosbridge Pty Ltd[1999]NSWCA 167; Guildford Rugby League Football & Recreational Club Ltd v Coad[2001] NSWCA 139; Club Italia (Geelong) Inc v Ritchie(2001) 3 VR 447; Bragg

v Returned and Services League Henley and Grange Sub-Branch Inc [2003] SASC226; Gordon v Tamworth Jockey Club Inc [2003] NSWCA 82; McNally vSpedding [2004] NSWCA 400; see also Livermore v Crombie [2006] QCA 169;Wagstaff v Haslem (2007) 69 NSWLR 1; Collingwood Hotel Pty Ltd v OReilly[2007] NSWCA 155; Conti v Wollongong City Council [2007] NSWCA 334;

Rooty Hill RSL Club Ltd v Karimi[2009] NSWSCA 2.



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is only in exceptional circumstances that a person is liable for anomission to act, including a failure to control others so as to preventphysical harm (5); (ii) the narrower principle that a person is not liablefor the criminal acts of another except in the case of certainrelationships, which do not include occupier and entrant; and (iii) thereasons given in previous cases at intermediate appellate level whichhave required at least that the occupier knew or ought to have knownof the violent propensity of the actual assailant and most of which haverequired also that there be knowledge of intoxication. There is nosatisfactory basis for distinguishing an occupier of licensed premisesfrom the occupier of any other type of premises when applyingModbury Triangle. Alternatively, the imposition of such a duty shouldbe limited to the circumstances identified in Wagstaff v Haslem(6):there must be knowledge, actual or constructive, of the aggressivecharacter of the person, when intoxicated, based on known

characteristics or conduct on the occasion in question. Alternatively, ifthe nature of the establishment or the nature of the function to beconducted provides a satisfactory basis for determining whether aduty is owed, the circumstances of this case do not justify theimposition of a duty. We nevertheless contend that the reasoning inprevious intermediate appellate cases is contrary to the principles wehave identified and is inconsistent with the reasons in ModburyTriangle. In addition, in the absence of an express term providing forthe provision of security to protect patrons, there is no satisfactorybasis for differentiating between contractual and non-contractualentrants to premises. The status of occupier must be the necessaryfactor. The appellant would not have any liability if the shootings hadnot occurred on its business premises (or, perhaps, in close proximityin place and time). Further, capacity to control is crucial. That capacity

can derive only from the status as occupier (in particular from theappellants status as an occupier of licensed premises with statutoryobligations). Absent capacity as an occupier to deny or withdrawpermission to be on its premises, the appellant would have no powerand hence no capacity to control the gunman. The legal power andpractical capacity of an occupier of licensed premises to control thebehaviour of patrons is no different from that of an occupier of anyother type of premises. [GUMMOWJ. If you had lost your licence youwould have been effectively out of business.] Secondly, the sale ofalcohol is not a sufficient basis to impose a duty to take reasonable careto prevent harm from criminal activity on occupiers of all licensedpremises. There are many kinds and sizes of licensed premises withdifferent characteristics. The burden on occupiers of such premises totake reasonable care is just as intolerable as for any other occupier,

because it is impossible to determine what precautions are reasonably

(5) Smith v Leurs(1945) 70 CLR 256; Smith v Littlewoods Organisation Ltd[1987]AC 241.

(6) [2007] NSWCA 28.



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required. The considerations of practicality and fairness referred toby Gleeson CJ (7) apply to occupiers of licensed premises as to anyother occupier. An effective response here required taking steps to dealwith a determined, irrational, armed man. Whether two unarmedsecurity guards would have been effective is debatable. If a duty isimposed, the reasonable response to the perceived risk would extend toall manner of violent criminal behaviour. [He referred to TAB Ltd vAtlis(8).]

Any duty requires only a reasonable response, even if it is known,or ought to be known, that a reasonable response will or may notprevent all foreseeable activity which may cause injury (9). Whether aresponse is reasonable is determined in accordance with the WyongCouncil v Shirt calculus having regard to the circumstances before theoccurrence, not by applying hindsight to determine what responsewould or might have prevented the occurrence and then considering

whether that response would be unduly onerous. [GUMMOW J referredto the Civil Liability Act.] The issue here is whether the reasonableresponse to the perceived risk of injury from intoxicated, unruly orviolent (including criminal) behaviour of other patrons requireddedicated security staff to be present from the beginning of thefunction. The evidence was that whether or not security was requiredfor a particular function was a matter of judgment. The usualpractice was to engage licensed security guards, but that was notuniversal. Both respondents knew that no dedicated security guardswere present at the particular function but neither expressed concern.Even if it was not fanciful that some form of intoxicated, unruly oreven violent conduct might occur, the possibility that it would occur ata function of this nature in a way requiring licensed security guardswas low. The power or capacity to take some preventative step is not

sufficient to establish an obligation to do so. The fact that anyestablishment always or usually engages dedicated security staff doesnot alone establish the reasonable standard for protection from criminalactivity or that the provision of such staff is reasonable. The findingthat licensed security staff were required prophylactically against theremote possibility that there would be violent behaviour which couldnot be dealt with by other staff is a misapplication of the WyongCouncil v Shirtcalculus to this case.

It is insufficient for a plaintiff to establish that there was a failure bythe defendant to take preventative measures and that an injury occurredwithin the area of risk the subject of the duty of care, at least where theconnection is not obvious or there is evidence which casts doubt on thecausal connection between breach and injury. There was no direct

evidence of what the gunmans response would have been to unarmed

(7) Modbury Triangle(2000) 205 CLR 254 at 268.(8) [2004] NSWCA 322 at [46]-[51].(9) Roads & Traffc Authority of NSW v Dederer (2007) 234 CLR 330.



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security guards attempting to dissuade him from returning with a gun.There was evidence that he was both determined and irrational. Theshootings were not an apparently spontaneous reaction to a perceivedinsult or attack but demonstrated a considered, but irrational,determination to exact revenge. The judge translated the opinionevidence of an expert that unarmed security guards should haveprevented the shootings to a finding that they would have done so. TheCourt of Appeals reasons translated the judges reasons into findingsconcerning the gunmans likely response to unarmed security guards.There was no basis for inferring that the gunman would haveresponded rationally if unarmed security guards had attempted toprevent him re-entering the premises.

B M J Toomey QC (with him D R Campbell SC and D C Morgan),for the respondent Moubarak. The principle in the Modbury Trianglecase (10) was not expressed to apply to all cases involving an occupier

and criminal behaviour by an entrant. It was expressed withqualifications (11). In a case such as this the capacity to controlconduct could be found in preventative measures, such as restrictingthe supply of alcohol, or reactive measures, such as providing capablesecurity officers who would be alert to trouble and able to stop it. Theacts of the assailant were not unpredictable, since they were driven bythe anger and desire for revenge which are natural in a man who hadbeen punched. The appellant postulates a negligible contribution toviolent behaviour on its premises by an occupier who serves a largenumber of people liquor in an enclosed space until a late hour withouthaving available any structured means of preventing the danger whichmight foreseeably arise. The argument is not founded on the facts,particularly as to contribution from the occupier and capacity toinfluence the behaviour. The relationship between the appellant and the

respondent, and with the assailant, arose out of contract for the entryand use of the premises with clearly implied terms. The appellant hadcomplete control over who entered and could have had completecontrol of who left and re-entered. If there had been such a structuredsystem, the officers would have known of the propensity of theassailant for violent behaviour. He would not have been allowed backafter having gone to a car in the car-park which was usually under thesurveillance of security guards, nor then without search or check. Itwas not necessary for liability that the violence which was foreseeablehad to be with a weapon. There is virtually no parallel between thefacts in this case and those of the Modbury Triangle case, nor werethey governed by the same legal duties.

The appellants alternative argument that the duty on licensedpremises should be limited to circumstances of knowledge, actual orconstructive, of the aggressive character of the person, when

(10) (2000) 205 CLR 254.(11) See (2000) 205 CLR 254 at 268, 270, 293-294.



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intoxicated, based on known characteristics or conduct on the occasion,is met by the fact that he was involved in the violence on the dancefloor, left the premises, went to his car and returned without anythingbeing done to stop him. The circumstances in which he left ought tohave put the defendant on notice of the likelihood of aggressivebehaviour if he returned. The appellant limits the necessary question byrequiring the knowledge to be before the start of any violence.

For the contract under which patrons came into the premises to havebusiness efficacy, there would have to be implied terms to the effectthat the occupier would take all reasonable steps to prevent harm fromthe materialisation of the risk of violence which is present when thereare a large number of people together over a long period withunlimited access to alcohol. That last duty might extend to the preciseneed for the provision of capable security staff. There is no authority tothe effect that the higher standard of duty owed to entrants under a

contract is no longer the law in Australia (12). Further, the occupierhad created a relationship with the respondent and others in hisposition by inviting them to enter on payment for the purpose ofcelebrating a special event. The appellant seeks to confine thedistinguishing factor to the fact that the appellant was the occupier oflicensed premises. The bare relationship of occupier of licensedpremises and a person invited on to the premises does not contain anyspecial features like those considered by Gleeson CJ and Hayne J inModbury Triangle to be features which may exclude the ModburyTriangle principle. If that case does not apply, the content of the dutywould be at large; Modbury Triangle recognised the existence of theordinary duty of occupier to entrant, but excised from it the contendedduty to protect entrants from criminal conduct. The duty stated byFullagar J in Watson v George(13) should be held to be the law and

not to have been altered by the test for non contractual entry inAustralian Safeway Stores v Zaluzna(14). The implied warranty fromWatson v Georgewould provide a principled basis for finding a duty toprevent the injury to the respondent caused by his assailant. In casesinvolving the provision of entertainment and alcohol for reward, thepromise to make the premises as safe as reasonable care and skill couldwould be nugatory if it did not extend to supervising and regulating thebehaviour of patrons sharing the premises with the respondent.Whether the care and skill taken has been reasonable will depend onthe size of the business, the nature of the activity, and the nature andnumber of those who could be reasonably expected to attend. Theappellants failure to provide security guards increased the risk ofinjury. Modbury Triangle did not raise a question of the duty owed

(12) See eg, Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313 at 338-340;Hoyts Pty Ltd v Burns(2003) 77 ALJR 1934 at 1940 [32]; 201 ALR 470 at 477.

(13) (1953) 89 CLR 409 at 424.(14) (1987) 162 CLR 479.



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under contract; the facts of a particular contract case would alwaysgive the answer to whether reasonable care and skill had been taken tosafeguard the plaintiff. The question raised here is whether the differentquestions of fact and law are governed by opinions in ModburyTriangle directed to different facts and legal duties. The duty is thesame as between entrants for reward and occupants of any premisesbut what is reasonable care and skill is mediated by the facts.

The appellant was in breach of its duty of care. The risk of physicalharm from other patrons was foreseeable, its magnitude was notinsubstantial, and the probability of its occurrence was notinsignificant. There can be no issue of the expense, difficulty orinconvenience of taking alleviating action in the light of the appellantspast system. The requirement ofRoads and Traffc Authority (NSW) vDederer (15) was satisfied. The judges findings of breach were wellfounded.

Whether the breaches caused or materially contributed to therespondents injury is a question of fact to be determined by theapplication of robust common sense and experience (16). The Courtshould accept the concurrent findings that the presence of securitywould have had an effective deterrent or preventative effect. Theappellants conduct increased the risk of injury and so materiallycontributed to it. The assailant would not have been allowed to re-enterwith a gun if properly searched. Reasonable steps would have hinderedor prevented injurious criminal conduct (17). Assessment of whatwould have happened is necessarily hypothetical and calls for acommon sense approach (18).

S G CampbellSC (with him J W Catsanos), for the respondent BouNajem.Australian common law recognises a duty to take care to avoid

reasonably foreseeable risk of injury to lawful visitors owed by theoccupier or person in control of licensed premises, extending toinjuries caused by the tortious and criminal acts of other lawfulvisitors (19). [He also referred to Smith v Littlewoods Organisation

(15) (2007) 234 CLR 330 at 354.(16) Fitzgerald v Penn(1954) 91 CLR 268; Bonnington Castings Ltd v Wardlaw [1956]

AC 613; Chappel v Hart(1998) 195 CLR 232 at 239, 244, 257, 269-270; Henvillev Walker(2001) 206 CLR 457 at 493, 507.

(17) Proprietors of Strata Plan 17226 v Drakulic (2002) 55 NSWLR 659 at 686.(18) Grittangi Stone Pty Ltd v Pavkovcich [2007] NSWCA 366 at [45]-[46].(19) Wormald v Robertson [1992] Aust Torts Reports 81-180; Chordas v Bryant

(Wellington) Pty Ltd(1998) 20 FCR 91 at 99; Club Italia (Geelong) Inc v Ritchie(2001) 3 VR 447 at 456-457, 460; Tweed Heads Rugby League Football Club v

Cole (2002) 55 NSWLR 113 at 137; Proprietors of Strata Plan 17226 v Drakulic(2002) 55 NSWLR 659 at 687-692; Gordon v Tamworth Jockey Club Inc [2003]NSWCA 82 at [42]; Lanahmede Pty Ltd v Koch [2004] SASC 2004 at [32]-[36];Wagstaff v Haslam (2007) 69 NSWLR 1; Spedding v Nobles (2007) 69 NSWLR100;Collingwood Hotel Pty Ltd v OReilly[2007] NSWCA 155 at [21]; Portelli vTabriska [2009] NSWCA 17 at [61]-[69].



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Ltd (20).] This was not an isolated act of violence by an intoxicatedcustomer. The harm arose from a state of affairs created by theappellant. In contrast to Modbury Triangle, the appellant had power tocontrol the conduct of all on the premises. There is a uniform pattern inthe licensing legislation of all States and Territories requiring themaintenance of order in licensed premises. Further, there is a specialrelationship between the operator of licensed premises and its patronsinvolving the existence of control (21). [He also referred to AshrafiPersian Trading Co Pty Ltd v Ashrafinia(22).]

The duty of an occupier to a person who enters premises undercontract covers not only the condition of the premises but the activitiescarried on within them (23). [He also referred to the Trade PracticesAct 1974 (Cth), s 74(1).] The absence of a planned securityarrangement on the night establishes breach of the duty at common lawand under contract.

Questions of causation involve hindsight. The appellants failure tohave an effective security plan was a cause of the injuriesdeterminative of liability if the appellant owed a duty of care. Theconcurrent findings of primary facts should not be upset. The relevantchain of events should be regarded as commencing with the altercation,growing in sequence to the breakdown of order creating theenvironment in which the serious crimes were committed. [He alsoreferred to Travel Compensation Fund v Tambree(24).] The causationprovisions of the Civil Liability Act 2002 (NSW) like the common lawconcentrate on terms of both causation and fact and also of thenormative standards that ought to have been brought to bear.[GUMMOW J. Section 5D(2) seems to postulate something thatordinarily is repugnant to judicial function: a declaration as to anterior

rights.] It goes beyond the but for test. There is an echo ofMarch vStramare (E & MH) Pty Ltd(25).

J E Sexton SC, in reply, referred to Calvert v Stollznow(26). Therespondents must establish on the but for test that the provision ofsecurity would have prevented the injuries occurring. Section 5D(2) oftheCivil Liability Actapplies in accordance with established principles.It does not refer to material increase in risk.

(20) [1987] AC 241 at 272.(21) Club Italia (Geelong) Inc v Ritchie (2001) 3 VR 447 at 459-460.(22) [2002] Aust Torts Reports 81-636 at 68,333 [61], 68,336 [69].

(23) Australian Racing Drivers Club Ltd v Medcalf(1961) 106 CLR 177; Cole v SouthTweed Heads Rugby Club (2004) 217 469 at 481, 495; Thompson v Woolworths(Qland) Pty Ltd (2005) 221 CLR 234 at 243-244.

(24) (2005) 224 CLR 627 at 639, 643.(25) (1991) 171 CLR 506 at 508-510.(26) [1982] 1 NSWLR 175 at 180.



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The parties were given leave to file supplementary writtensubmissions upon the application of the Civil Liability Act 2002(NSW).

Cur adv vult

10 November 2009

THECOURT delivered the following written judgment:

The appellant in each appeal (Adeels Palace Pty Ltd AdeelsPalace) carried on a reception and restaurant business at premises inPunchbowl, New South Wales. The premises were licensed under theLiquor Act 1982 (NSW) (27). An On-Licence (Restaurant) licencepermitted the service of alcohol on the premises on any day, betweenmidday and 4 am on the day following. A condition of the licencelimited the seating capacity of the premises to restaurant seating for295 persons. The local council authorised the use of the premises as aplace of public entertainment between midday and 4 am on the nextday but limited the capacity of the premises to 283 persons. At thetimes relevant to these matters, a director of Adeels Palace was thelicensee.

On 31 December 2002, Adeels Palace was open for business andmany came to celebrate the New Year. The restaurant was full. Exactlyhow many were there was never proved. Admission to the premises,collected at the door, cost $60 per person which included food but notalcoholic drinks. There was a band; there were singers and entertainers;patrons could dance. Seating was at long tables. The bar was open.Waiters brought drinks to the tables.

At about 2.30 am on 1 January 2003, there was a dispute betweensome women dancing on the dance floor. One accused another ofbrushing her hand with a lighted cigarette. Words were exchanged.

Relatives and friends intervened. Fighting erupted and onlookersjoined in. Punches were thrown. Chairs, plates and bottles werethrown. One witness was later to agree that the disruption got biggerand more ferocious very quickly. As he said, there were [a] lot ofegos out there.

One man involved in the fight was hit in the face, drawing blood. Heleft the restaurant and returned soon after with a gun. Someone calledout Gun, gun, run away and Mr Bou Najem (the respondent in thesecond appeal in this Court) did just that. He ran into the restaurantskitchen but slipped over. The gunman came in. As Mr Bou Najem triedto get up, the gunman pointed the gun at him. Mr Bou Najem pleadedwith him not to shoot, but shoot he did, wounding Mr Bou Najem inthe leg.

The gunman left the kitchen and went back into the restaurant itself.

There he found the man who had struck him in the face

(27) The Liquor Act 1982 (NSW) has since been repealed and replaced by the LiquorAct 2007 (NSW). In relevant respects the 2007 Act contains generally similarprovisions to those of the 1982 Act that are mentioned later in these reasons.


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Mr Moubarak (the respondent in the first appeal). The gunman shotMr Moubarak in the stomach and then left the premises.

The two men who were shot, Mr Bou Najem and Mr Moubarak,each brought proceedings in the District Court of New South Walesagainst Adeels Palace claiming damages for personal injury. Eachalleged that they had suffered injury as a result of Adeels Palacesnegligence in not providing any or any sufficient security during thefunction on New Years Eve.

In the District Court, the two actions were heard together, and eachplaintiff obtained judgment for damages. Adeels Palace appealed to theCourt of Appeal of New South Wales and that Court (Beazley, Gilesand Campbell JJA) dismissed (28) each appeal. By special leave,Adeels Palace appeals to this Court. Each appeal should be allowed.Consequential orders should be made entering judgment in eachproceeding for Adeels Palace.

The issuesThere was no dispute in these matters that both Mr Bou Najem and

Mr Moubarak had suffered serious personal injury. The live issues inthe case of each, at trial, on appeal to the Court of Appeal, and in thisCourt, were, however, whether Adeels Palace owed each a duty of careto prevent harm of the kind suffered, whether that duty had beenbreached, and whether the breach was a cause of the damage suffered.In Mr Moubaraks case, quantum of damages was a live issue at trialbut not on appeal.

In this Court, Adeels Palace submitted that it owed no duty to thoseattending its premises to prevent criminal conduct by third parties. Itsubmitted that so much is established by this Courts decision inModbury Triangle Shopping Centre Pty Ltd v Anzil(29). It submittedfurther that, if it did owe some relevant duty of care to its patrons, itwas not shown that the reasonable response to the risk of violentbehaviour at the function would have been to employ licensed securitypersonnel. Finally, it submitted that it was not shown that the want oflicensed security personnel was a cause of the shooting of eitherplaintiff.

Each plaintiff raised further issues in this Court, by notice ofcontention. Each submitted that he had entered the restaurant under acontract, and that accordingly, by operation of s 74 of the TradePractices Act 1974 (Cth), Adeels Palace impliedly warranted that theservices it provided would be provided with due care and skill(including, in this case, by provision of suitable security services). Asthese reasons will later demonstrate, it will not be necessary toconsider this contention in any detail. Mr Moubarak further sought to

contend (by an amendment of his notice of contention first proposed atthe hearing of the appeal to this Court) that causation was established

(28) Adeels Palace Pty Ltd v Moubarak[2009] Aust Torts Reports 81-997.(29) (2000) 205 CLR 254.


French CJ, Gummow, Hayne, Heydon and Crennan JJ

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in this case by demonstrating no more than that the failure of AdeelsPalace to engage competent security staff resulted in a materialincrease in an existing risk of injury to [him] from violent acts of otherpatrons and so materially contributed to the injuries suffered by him.

In considering each of the issues of duty, breach and causation, it isof the first importance to identify the proper starting point for therelevant inquiry. In this case there are two statutes which requireparticular consideration: the Civil Liability Act 2002 (NSW) and theLiquor Act. If attention is not directed first to the Civil Liability Act,and then to the Liquor Act, there is serious risk that the inquiries aboutduty, breach and causation will miscarry.

The Civil Liability Act

The Civil Liability Act is taken to have commenced on20 March 2002 (s 2). At the relevant times, s 5A of the Act providedthat Pt 1A (30) applies to any claim for damages for harm resulting

from negligence, regardless of whether the claim is brought in tort, incontract, under statute or otherwise. Part 1A of the Act includedDiv 2, entitled Duty of care (ss 5B and 5C), and Div 3, entitledCausation (ss 5D and 5E).

Although ss 5B and 5C appear beneath the heading Duty of care,that heading is apt to mislead. The sections provided:

5B General principles

(1) A person is not negligent in failing to take precautions against arisk of harm unless:

(a) the risk was foreseeable (that is, it is a risk of which theperson knew or ought to have known), and

(b) the risk was not insignificant, and

(c) in the circumstances, a reasonable person in the persons

position would have taken those precautions.(2) In determining whether a reasonable person would have takenprecautions against a risk of harm, the court is to consider thefollowing (amongst other relevant things):

(a) the probability that the harm would occur if care were nottaken,

(b) the likely seriousness of the harm,

(c) the burden of taking precautions to avoid the risk of harm,

(d) the social utility of the activity that creates the risk of harm.

5C Other principles

In proceedings relating to liability for negligence:

(a) the burden of taking precautions to avoid a risk of harm includesthe burden of taking precautions to avoid similar risks of harm forwhich the person may be responsible, and

(b) the fact that a risk of harm could have been avoided by doing

(30) As inserted in the Civil Liability Act 2002 (NSW) by the Civil LiabilityAmendment (Personal Responsibility) Act 2002(NSW).


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something in a different way does not of itself give rise to or affectliability for the way in which the thing was done, and

(c) the subsequent taking of action that would (had the action beentaken earlier) have avoided a risk of harm does not of itself give riseto or affect liability in respect of the risk and does not of itselfconstitute an admission of liability in connection with the risk.

Both provisions are evidently directed to questions of breach of duty.

By contrast, Div 3 (ss 5D and 5E) is directed to the subject matterdescribed in the heading to the division Causation. Those sectionsprovided:

5D General principles

(1) A determination that negligence caused particular harmcomprises the following elements:

(a) that the negligence was a necessary condition of theoccurrence of the harm (factual causation), and

(b) that it is appropriate for the scope of the negligent personsliability to extend to the harm so caused (scope of liability).

(2) In determining in an exceptional case, in accordance withestablished principles, whether negligence that cannot be estab-lished as a necessary condition of the occurrence of harm should beaccepted as establishing factual causation, the court is to consider(amongst other relevant things) whether or not and whyresponsibility for the harm should be imposed on the negligentparty.

(3) If it is relevant to the determination of factual causation todetermine what the person who suffered harm would have done ifthe negligent person had not been negligent:

(a) the matter is to be determined subjectively in the light of allrelevant circumstances, subject to paragraph (b), and

(b) any statement made by the person after suffering the harmabout what he or she would have done is inadmissible except tothe extent (if any) that the statement is against his or her interest.

(4) For the purpose of determining the scope of liability, the court isto consider (amongst other relevant things) whether or not and whyresponsibility for the harm should be imposed on the negligentparty.

5E Onus of proof

In determining liability for negligence, the plaintiff always bearsthe onus of proving, on the balance of probabilities, any factrelevant to the issue of causation.

These provisions of the Civil Liability Act are central to thequestions of breach of duty and causation.

The Liquor Act

Consideration of provisions of the Liquor Act is central to thequestion of duty of care. Why that is so is revealed by the nature of theclaims that were made.



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Each plaintiff sued Adeels Palace for damages for injury he hadsuffered on the premises of Adeels Palace. It was not disputed, in eithermatter, that [a]t all material times [Adeels Palace] operated [the]licensed premises known as Adeels Palace (31). Nor was there anydispute that on 31 December 2002 the business conducted by AdeelsPalace was controlled by two men: Mr Simon Bazouni and Mr FouadKouzi. Mr Bazouni was licensee.

The central complaint each plaintiff made was that Adeels Palacehad not regulated who came on to its premises, who stayed on thosepremises, and how those who were on the premises conductedthemselves towards other patrons. Adeels Palace, as occupier of thepremises, could control who came into and who stayed on thepremises. But in conducting licensed premises (of which one of itsdirectors was licensee) Adeels Palace was much affected by the dutieswhich the Liquor Actcast on the licensee.

Section 125 of the Liquor Act regulated conduct on licensedpremises. Section 125(1)(b) obliged a licensee not to permit on his orher licensed premises any indecent, violent or quarrelsome conduct.Contravention of the provision was an offence. Section 103(1) of theLiquor Actpermitted a licensee, or his or her employee, to refuse toadmit to the licensed premises or to turn out, or cause to be turnedout, of the licensed premises any person who is then violent,quarrelsome or disorderly (s 103(1)(a)) or whose presence on thelicensed premises renders the licensee liable to a penalty (s 103(1)(c))under the Act. Section 103(3A) permitted the use of such reasonabledegree of force as may be necessary to turn a person out of thepremises. Section 103(4) obliged a member of the police force, askedby the licensee or an employee to turn out or assist in turning out aperson whom the licensee is entitled to turn out, to comply with the

request and provided that the member of the police force may, for thatpurpose, use such reasonable degree of force as may be necessary.

It is next important to recognise that the particular provisions madein the Liquor Act for controlling violent, quarrelsome or disorderlyconduct on licensed premises take their place in a context set by twoconsiderations. First, sale of liquor is controlled because it is wellrecognised that misuse and abuse of liquor causes harm, includingwhat the Liquor Actrefers to as violent, quarrelsome or disorderlyconduct. Section 2A of the Liquor Actprovided:

(31) Liquor licensing and corporate records tendered in evidence at trial appear tosuggest that a company called Adeels Restaurant Pty Ltd was the owner of the

business at the relevant time but in the light of the way in which the trial wasconducted this suggestion need not be examined further. Those records, and aphotograph, tendered in evidence at trial, of the sign advertising the business,suggest that the appellants business was conducted under the name of AdeelsPalace. It is convenient, however, to adopt the spelling used in the title of theproceedings in this Court.


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Liquor harm minimisation is a primary object of this Act

A primary object of this Act is liquor harm minimisation, that is,the minimisation of harm associated with misuse and abuse ofliquor (such as harm arising from violence and other anti-socialbehaviour). The court, the Board, the Director, the Commissioner ofPolice and all other persons having functions under this Act arerequired to have due regard to the need for liquor harmminimisation when exercising functions under this Act. Inparticular, due regard is to be had to the need for liquor harmminimisation when considering for the purposes of this Act what isor is not in the public interest.

The second and related point to make is that the duties cast upon thoseresponsible for the service of liquor on licensed premises can beunderstood as a part of the price that is exacted for the statutorypermission granted under the Liquor Act. The permission granted is to

do what otherwise the Act forbids (s 122) sell liquor and to do thaton premises to which members of the public may resort only inaccordance with the conditions on which the licence is granted.

In considering whether a common law duty of care should be held toexist in these cases, it is important to recognise that the provisions ofthe Liquor Act that have been mentioned have close analogies in otherStates and Territories. Though variously expressed, all States andTerritories make provision for a licensee of licensed premises toremove from, or prevent the entry to, licensed premises of violent orquarrelsome persons (32). All State and Territory liquor legislationforbids the sale of liquor without a licence. All State and Territoryliquor legislation provides for the licensing of premises on whichliquor may be sold and consumed, and not only regulates the sale andservice of liquor in such places, but also (as already noted) directly or

indirectly regulates the conduct of persons who are on the premises.It is against this statutory background that the question of duty of

care must be considered, not for the purpose of developing thecommon law by analogy with statute law (33), but to ensure that theimposition of a common law duty of reasonable care of the kind nowin question would not run counter to the statutory requirementsimposed on licensees in all Australian jurisdictions.

Duty of care?

Contrary to the submissions on behalf of Adeels Palace, this Courtsdecision inModbury does not dictate the conclusion that Adeels Palaceowed no relevant duty of care to the plaintiffs in the present cases. Likethe claims now under consideration, the claim that was made in

(32) Liquor Control Reform Act 1998 (Vic), s 114(2), and see also s 108(4)(b) of thatAct; Liquor Licensing Act 1997 (SA), s 124(1); Liquor Act 1992 (Qld), ss 165,165A; Liquor Control Act 1988 (WA), s 115; Liquor Licensing Act 1990 (Tas),ss 62, 79A; Liquor Act(NT), ss 105, 121; Liquor Act 1975 (ACT), s 143.

(33) cfEsso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201CLR 49 at 59-63 [18]-[28].



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Modbury was for damages for personal injury suffered as a result of acriminal assault. The injured plaintiff in Modbury had been attacked ina shopping centre car park at night when the lights in the car park wereoff. He alleged that the shopping centre proprietor was negligent in notleaving the car park lights on. A majority of the Court (34) held that theshopping centre did not owe the plaintiff a duty to take reasonable careto prevent injury to the plaintiff resulting from the criminal behaviourof third persons on the shopping centres land. It is important torecognise, however, that the duty alleged in Modbury was said to befounded only on the defendants position as occupier of the landcontrolling the physical state of the land (there the level of itsillumination). What is said in Modbury must be understood asresponding to those arguments. No complaint was made (35) that thedefendant should have controlled, but did not control, access by theassailants to the land it occupied.

It is, of course, important to recognise that the decision in Modburyforms part of a line of cases in which consideration has been given towhether and when one person owes another a duty to take reasonablecare to control the conduct of a third person (36). And the fact that theconduct in question is criminal conduct is of great importance indeciding not only what, if any, duty is owed to prevent its commission,but also questions of breach and causation.

Several considerations set the present case apart from Modbury andpoint to the conclusion that Adeels Palace owed each plaintiff arelevant duty of care. First, the complaint that was made in these caseswas that the occupier of premises failed to control access to, orcontinued presence on, its premises (37). Secondly, the premisesconcerned were licensed premises where liquor was sold. They were,therefore, premises where it is and was well recognised that care must

be taken lest, through misuse and abuse of liquor, harm [arise] fromviolence and other anti-social behaviour (38). And thirdly, theparticular duty said to have rested on the occupier of the premises (whowas the operator of the business that was conducted on the premises) isa duty to take reasonable care to prevent or hinder the occurrence ofevents which, under the Liquor Act, the licensee was bound to preventoccurring violent, quarrelsome or disorderly conduct. (And althoughvariously expressed in the legislation of other Australian jurisdictions,

(34) (2000) 205 CLR 254 at 266-267 [29], 268-269 [36] per Gleeson CJ; at 270[42]-[43] per Gaudron J; at 291-294 [108]-[118] per Hayne J; at 302 [147] perCallinan J.

(35) (2000) 205 CLR 254 at 290 [106].(36) See, eg,Smith v Leurs (1945) 70 CLR 256 at 262 per Dixon J; Howard v Jarvis

(1958) 98 CLR 177; New South Wales v Bujdoso (2005) 227 CLR 1; cfStuart vKirkland-Veenstra (2009) 237 CLR 215; CAL No 14 Pty Ltd v Motor Accidents

Insurance Board (2009) 239 CLR 390.(37) cf Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254 at

293-294 [117].(38) Liquor Act 1982 (NSW), s 2A.


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the evident scheme of all liquor licensing laws in Australia is tominimise anti-social conduct both on and off licensed premisesassociated with consumption of alcohol.)

In the circumstances reasonably to be contemplated before therestaurant opened for business on 31 December 2002 as likely toprevail on that night, Adeels Palace owed each plaintiff a duty to takereasonable care to prevent injury to patrons from the violent,quarrelsome or disorderly conduct of other persons. The duty isconsistent with the duty imposed by statute upon the licensee andwhich was a duty enforceable by criminal processes. No questionarises of translating a statutory power given to a statutory body into thecommon law ought (39). The duty is not absolute; it is a duty to takereasonable care. It is not a duty incapable of performance. It is a dutythe performance of which is supported by the provision of statutorypower to prevent entry to premises and to remove persons from the

premises, if needs be by using reasonable force. Although it is a dutydirected to controlling the conduct of others (for the avoidance ofinjury to other patrons) it is a duty to take reasonable care in theconduct of activities on licensed premises, particularly with regard toallowing persons to enter or remain on those premises.

Breach of duty?

The question of breach of duty must be considered by reference tothe relevant provisions of the Civil Liability Act in particular s 5B.

It may be accepted, for the purposes of argument, that there was arisk, of which Adeels Palace knew or ought to have known(s 5B(1)(a)), that there would be violent, quarrelsome or disorderlyconduct in the restaurant. It may also be accepted that this risk wasnot insignificant (s 5B(1)(b)). The question then becomes whether areasonable person in the position of Adeels Palace would have takenthe precautions that the plaintiffs alleged should have been taken(ss 5B(1)(c), 5B(2)). Those precautions were the provision oflicensed (40) security personnel who would act as crowd controllers orbouncers.

Just how many security personnel the plaintiffs alleged should havebeen provided was not always made clear in argument. The plaintiffspleaded their cases on the basis that there should have been not onlysecurity personnel controlling the entrance to the premises but alsosufficient security personnel to intervene in any dispute that broke outwithin the restaurant. Because the restaurant was on the second floor ofa building it seems to have been accepted that to supervise what washappening inside the restaurant would have required personnel whowere different from those who controlled access to the premises. Someevidence led at trial suggested that as many as six or eight persons

(39) cf Pyrenees Shire Council v Day (1998) 192 CLR 330 at 375 [122].(40) Under the Security Industry Act 1997(NSW).



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would have been necessary to supervise both the interior of, and theentrance to, the restaurant.

Whether any, and how many, security personnel should have beenprovided to satisfy the duty of Adeels Palace to take reasonable caredepended upon the considerations identified in s 5B(2) of the CivilLiability Act: the probability that the harm would occur, the likelyseriousness of the harm, the burden of taking precautions to avoid therisk, and the social utility of the activity that created the risk. No doubtthe chief focus of those inquiries in these cases would fall upon thefirst three of those considerations.

Many different matters were relevant to the questions that thus wereposed. They included, but were not limited to, such matters as thenumber of patrons expected to attend the restaurant, the atmospherethat could reasonably be expected to exist during the function, andwhether there had been any suggestion of violence at similar events

held in comparable circumstances, either at this restaurant orelsewhere. And all of those questions fell to be answered, and theprobability of harm and other considerations mentioned in s 5B(2)assessed, prospectively (41), not with the wisdom of hindsight. That is,they were to be assessed beforethe function began, not by reference towhat occurred that night.

The evidence led in these cases included evidence of the opinions ofpersons who described themselves as security consultants. The trial

judge understood the evidence of the experts called by the plaintiffsand by Adeels Palace as accepting that there had been a need foraccess control as the front line of defence having the purpose ofdiscouraging at least, if not preventing, the return of unruly ortroublesome patrons who [had] left the premises. Whether or to whatextent this opinion of the experts was based on their consideration of

what had happened on this occasion (an irrelevant inquiry), as opposedto the probability of violence if access control were notprovided (42), was not expressly considered by the trial judge.

No finding was made below that there should have been securitypersonnel supervising conduct in the restaurant. Both the trial judgeand the Court of Appeal proceeded on the footing that it was sufficientto find that the failure to provide security personnel who would controlaccess to the restaurant was a breach of the duty of care owed byAdeels Palace. That is, both the trial judge and the Court of Appealconcluded that the failure of Adeels Palace to provide licensedpersonnel to act as crowd controllers or bouncers at the door of thepremises (in addition to whomever Adeels Palace used to take the costof admission from patrons at the door) was a breach of the duty of careowed by Adeels Palace to its patrons.

(41) Vairy v Wyong Shire Council (2005) 223 CLR 422 at 461-463 [126]-[129].(42) Civil Liability Act 2002 (NSW), s 5B(2)(a).


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Having regard to the Civil Liability Act, this conclusion could bereached only if the probability of unruly or troublesome patrons who[had] left the premises returning to do violence to other patrons, or theprobability of other persons likely to do violence to patrons seeking togain entry to the premises, was such that a reasonable person in theposition of Adeels Palace would have employed security personnel tocontrol access to the restaurant.

But why a reasonable person would have taken that step was neverclearly articulated in argument or in the reasoning of the trial judge.Considered in isolation, the numbers attending the restaurant, and thetype of customers (spread over a range of ages, with some in family orfriendship groups extending over several generations), did notdemonstrate a need for provision of security personnel controllingaccess to the restaurant. And despite the plaintiffs attempt to prove attrial that the venue had a history of violent incidents, there appears to

have been nothing in that history (which went no further than somereports of threatening conduct by passers-by outside the restaurantpremises) which would have warranted the conclusion that there wasthe probability of violence erupting in or about the restaurant. Noargument to that effect was advanced orally in this Court.

Reference was made in argument in this Court on behalf of Mr BouNajem to the possibility that security personnel supervising the floor ofthe restaurant may have been able to intervene in the dispute on thedance floor and prevent the rapid descent into general violence thatfollowed. To do that would have required several more securitypersonnel than the small number it was suggested should have beencontrolling access to the restaurant.

The argument necessarily asserted that licensed security personnelwere the appropriate response to this risk. That is, the argument was

that any exchange of words between patrons at this function wouldrequire an immediate and decisive response by persons having whatmight be called the presence or physical authority of bouncers orcrowd controllers.

Of course there is always a risk that there will be some altercationbetween patrons at almost any kind of event. And the risk of thathappening is higher if the patrons are consuming alcohol. But unlessthe risk to be foreseen was a risk of a kind that called for, as a matterof reasonable precaution, the presence or physical authority ofbouncers or crowd controllers to deal with it safely, failure to providesecurity of that kind would not be a breach of the relevant duty of care.As noted earlier, there was no finding at trial or in the Court of Appealthat a risk of that kind should have been foreseen.

The absence of consideration at trial of the matters prescribed by

s 5B of the Civil Liability Act may have been reason enough toconclude that the question of breach of duty was not determinedproperly by the trial judge. It is, however, not profitable to examinethat issue further.



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It is not profitable to do that because resolution of the issue ofbreach would necessarily depend only upon the evidence that was ledat trial. The points to be made that are of general application are first,that whether a reasonable person would have taken precautions againsta risk is to be determined prospectively, and secondly, that the answergiven in any particular case turns on the facts of that case as they areproved in evidence. It follows from the second of these considerationsthat deciding the question of breach in these cases would not establishany rule about when or whether security personnel should be engagedby the operators of licensed premises. It is not useful (43) in thesecircumstances for this Court to form a conclusion about whetherbreach was proved in these cases. In particular, it is not necessary toexamine the evidence that was led at trial to determine whether thefinding of breach could be supported. Instead, it is desirable to considerthe question of causation. Examination of that issue reveals that the

negligence found against Adeels Palace was not shown to have been acause of the injuries suffered by the plaintiffs.

Causation

The first point to make about the question of causation is that, inthese cases, it is governed by the Civil Liability Act.

Section 5D(1) of that Act divides the determination of whethernegligence caused particular harm into two elements: factual causationand scope of liability.

Dividing the issue of causation in this way expresses the relevantquestions in a way that may differ from what was said by Mason CJ, inMarch v E and MH Stramare Pty Ltd(44), to be the common lawsapproach to causation. The references (45) in March v Stramare tocausation being ultimately a matter of common sense were evidentlyintended to disapprove the proposition that value judgment has, orshould have, no part to play in resolving causation as an issue of fact.By contrast, s 5D(1) treats factual causation and scope of liability asseparate and distinct issues.

It is not necessary to examine whether or to what extent theapproach to causation described in March v Stramare might lead to aconclusion about factual causation different from the conclusion thatshould be reached by applying s 5D(1). It is sufficient to observe that,in cases where the Civil Liability Act or equivalent statutes areengaged, it is the applicable statutory provision that must be applied.

Next it is necessary to observe that the first of the two elementsidentified in s 5D(1) (factual causation) is determined by the but fortest: but for the negligent act or omission, would the harm haveoccurred?

(43) cf Pokora v Wabash Railway Co (1934) 292 US 98 at 105-106 per Cardozo J.(44) (1991) 171 CLR 506 at 515.(45) (1991) 171 CLR 506 at 515, quoting from Fitzgerald v Penn (1954) 91 CLR 268

at 277.


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In the Court of Appeal, Giles JA, who gave the principal reasons,pointed out (46), correctly, that the reasoning of the trial judge on thequestion of causation was not fully articulated. The reasoning wasreconstructed (47) by Giles JA in the following terms:

From the evidence, security staff would have been aware of asignificant fracas on the dance floor. Even if [the gunman] had notbeen identified at the time as the man who had got into a fight withMr Moubarak, the presence of blood on his face would have causedthe security staff at the street entrance, particularly with knowledgeof the fracas, to deny him entry, or at least to require that he submitto search as a condition of being permitted to enter. On the balanceof probabilities, security staff at the street entrance would havedeterred or prevented [the gunmans] re-entry, and he thereforewould not have shot Mr Moubarak and Mr Bou Najem.

Security personnel may have been able to deter or prevent re-entry

by the drunk or the obstreperous would-be patron willing to throw apunch. There was, however, no basis in the evidence for concludingthat security staff at the entrance to the restaurant would have deterredor prevented the re-entry to the premises of a man armed with a gunwhen later events showed he was ready and willing to use the weaponon persons unconnected with his evident desire for revenge.

The evidence at trial did not show that the presence of securitypersonnel would have deterred the re-entry of the gunman. Thatconclusion could have been reached only if it was assumed that thegunman would have acted rationally. But, as was pointed out inModbury(48), [t]he conduct of criminal assailants is not necessarilydictated by reason or prudential considerations. The gunmansconduct at the restaurant on this night was dictated neither by reasonnor by prudential considerations. He shot the man who had struck him

during the mle that broke out after the confrontation on the dancefloor. And before shooting that man, the gunman had shot a man whohad done nothing to him and who, defenceless, begged for mercy.

Nor did the evidence show that security personnel could or wouldhave prevented re-entry by the gunman: a determined person armedwith a gun and irrationally bent on revenge. The evidence given at trialby the plaintiffs expert security consultant did not go beyond theassertion that a security person confronting the gunman at the entranceto the restaurant would have at least altered the chain of events andthereby likely altered the outcome. The security consultant called onbehalf of Adeels Palace emphasised that the overriding principle whichshould govern the conduct of security personnel confronted by agunman is safety for all parties and that once a determined gunmanis targeting a victim or victims there [is] no guaranteed safe or effective

option.

(46) [2009] Aust Torts Reports 81-997 at 62,744 [107].(47) [2009] Aust Torts Reports 81-997 at 62,744 [107].(48) (2000) 205 CLR 254 at 291 [107].



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Recognising that changing any of the circumstances in which theshootings occurred might have made a difference does not provefactual causation. Providing security at the entrance of the restaurantmight have delayed the gunmans entry; it might have meant that, ifMr Bou Najem was a random victim, as seemed to be the case,someone else might have been shot and not him. But neither plaintiffproved factual causation by pointing to possibilities that might haveeventuated if circumstances had been different.

Nor was but for causation established in these cases by observingthat the relevant duty was to take reasonable care to prevent injury topatrons from the violent, quarrelsome or disorderly conduct of otherpersons. That is, the question of factual causation was not answered inthese cases by pointing out that the relevant duty of care was to takereasonable steps to prevent violent assault, that each plaintiff was thevictim of a violent assault, and that the damage sustained by the

plaintiffs was the very kind of thing which the relevant duty obligedAdeels Palace to take reasonable steps to prevent (49). Thatobservation may bear upon questions about scope of liability (50).Describing the injury as the very kind of thing which was the subjectof the duty must not be permitted to obscure the need to prove factualcausation. UnlikeHome Offce v Dorset Yacht Co Ltd(51) andStansbiev Troman (52), these are not cases where the evidence demonstratedthat the taking of reasonable care would probably have prevented theoccurrence of injury to the plaintiffs.

Counsel for the plaintiffs, in this Court, relied upon passages inChappel v Hart (53). But in that case the majority proceeded on thebasis that but for the failure to warn the event would not havehappened; the question then was whether certain additional factors,combined with the satisfaction of the but for test, were sufficient to

establish causation (54).In the present case, in contrast, the but for test of factual causation

was not established. It was not shown to be more probable than notthat, but for the absence of security personnel (whether at the door oreven on the floor of the restaurant), the shootings would not have takenplace. That is, the absence of security personnel at Adeels Palace onthe night the plaintiffs were shot was not a necessary condition of theirbeing shot. Because the absence of security personnel was not anecessary condition of the occurrence of the harm to either plaintiff,s 5D(1) was not satisfied. Did s 5D(2) apply?

(49) cf Home Offce v Dorset Yacht Co Ltd [1970] AC 1004 at 1030 per Lord Reid;Stansbie v Troman [1948] 2 KB 48 at 51-52.

(50) cf Travel Compensation Fund v Tambree (2005) 224 CLR 627 at 638-639[26]-[27], 641-642 [40]-[41].

(51) [1970] AC 1004.(52) [1948] 2 KB 48.(53) (1998) 195 CLR 232.(54) (1998) 195 CLR 232 at 238-239 [8], 257 [66]-[67], 269-270 [93].


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Section 5D(2) makes provision for what it describes as anexceptional case. But the Act does not expressly give content to thephrase an exceptional case. All that is plain is that it is a case wherenegligence cannot be established as a necessary condition of the harm;the but for test of causation is notmet. In such a case the court iscommanded to consider (amongst other relevant things) whether ornot and why responsibility for the harm should be imposed on thenegligent party. But beyond the statement that this is to be done inaccordance with established principles, the provision offers no furtherguidance about how the task is to be performed. Whether, or when,s 5D(2) is engaged must depend, then, upon whether and to whatextent established principles countenance departure from the butfor test of causation.

At once it must be recognised that the legal concept of causationdiffers from philosophical and scientific notions of causation (55). It

must also be recognised that before the Civil Liability Act andequivalent provisions were enacted, it had been recognised (56) thatthe but for test was not always a suffcient test of causation. But ass 5D(1) shows, the but for test is now to be (and has hitherto beenseen to be) a necessary test of causation in all but the undefined groupof exceptional cases contemplated by s 5D(2).

Even if the presence of security personnel at the door of therestaurant might have deterred or prevented the person who shot theplaintiffs from returning to the restaurant, and even if securitypersonnel on the floor of the restaurant might have been able tointervene in the incident that broke into fighting in time to preventinjury to anyone, neither is reason enough to conclude that this is anexceptional case where responsibility for the harm suffered by theplaintiffs should be imposed on Adeels Palace. To impose that

responsibility would not accord with established principles.It may be that s 5D(2) was enacted to deal with cases exemplified by

the House of Lords decision in Fairchild v Glenhaven Funeral ServicesLtd(57) where plaintiffs suffering from mesothelioma had beenexposed to asbestos in successive employments. Whether or hows 5D(2) would be engaged in such a case need not be decided now. Thepresent cases are very different. No analogy can be drawn with caseslike Fairchild. Rather, it would be contrary to established principles tohold Adeels Palace responsible in negligence if not providing securitywas not a necessary condition of the occurrence of the harm butproviding security mighthave deterred or prevented its occurrence, ormight have resulted in harm being suffered by someone other than, or

(55) March v E and MH Stramare Pty Ltd (1991) 171 CLR 506 at 509; Bennett vMinister of Community Welfare (1992) 176 CLR 408 at 412-413, 418-419, 428;Chappel v Hart(1998) 195 CLR 232 at 238 [6], 255 [62].

(56) Bennett v Minister of Community Welfare(1992) 176 CLR 408 at 413; Chappel vHart (1998) 195 CLR 232 at 257 [66]-[67].

(57) [2003] 1 AC 32.



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in addition to, the plaintiffs. As in Modbury(58), the event whichcaused the plaintiffs injuries was deliberate criminal wrongdoing, andthe wrongdoing occurred despite society devoting its resources todeterring and preventing it through the work of police forces and thepunishment of those offenders who are caught. That being so, it shouldnot be accepted that negligence which was not a necessarycondition ofthe injury that resulted from a third persons criminal wrongdoing wasa cause of that injury. Accordingly, the submission that the plaintiffsinjuries in these cases were caused by the failure of Adeels Palace totake steps that mighthave made their occurrence less likely, should berejected.

The Trade Practices Act contention

As noted earlier in these reasons, each plaintiff sought to support theorders made in his favour in the Court of Appeal by contending thats 74 of the Trade Practices Act was engaged. Even if that were so,

each plaintiff could recover damages for breach of such an impliedwarranty only if he established at least that breach of the warranty wasa cause of (in the sense of materially contributed to) his loss (59).Whether more than material contribution to loss must be established tomake good a claim for breach of an implied warranty need not beconsidered. For the reasons given earlier, a but for causal connectionbetween absence of security and injury to either plaintiff was notestablished in these cases. It was not shown that absence of securitymaterially contributed to either plaintiff being injured. The contentionthat the judgment below is to be supported by reference to s 74 of theTrade Practices Actshould be rejected.

Conclusion and orders

Each appeal should be allowed with costs. In each case the orders of

the Court of Appeal of the Supreme Court of New South Wales enteredon 24 March 2009 should be set aside and in their place there shouldbe orders that the appeal to that Court is allowed with costs, the

judgment of the District Court of New South Wales set aside and in itsplace there be judgment for the defendant with costs.

ADEELSPALACEPTY LTD v MOUBARAK

1. Appeal allowed with costs.

2. Set aside the orders of the Court of Appealof the Supreme Court of New South Walesentered on 24 March 2009, and in lieuthereof order that:

(a) the appeal to that Court be allowedwith costs;

(58) (2000) 205 CLR 254 at 292-293 [113].(59) See, concerning contraventions of the Trade Practices Act 1974 (Cth), I & L

Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 at127-129 [54]-[58].


58

59


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(b) the orders of the District Court ofNew South Wales made on 25January 2008, as amended by order1 of the orders of that Court madeon 14 February 2008, be set aside,and in lieu thereof there be judg-ment for the defendant with costs.

ADEELSPALACEPTY LTD v BOU NAJEM

1. Appeal allowed with costs.

2. Set aside the orders of the Court of Appealof the Supreme Court of New South Walesentered on 24 March 2009, and in lieuthereof order that:

(a) the appeal to that Court be allowedwith costs;

(b) the orders of the District Court ofNew South Wales made on 25January 2008, be set aside, and inlieu thereof there be judgment forthe defendant with costs.

Solicitors for the appellant, Lee & Lyons.

Solicitors for the respondent Moubarak, Leitch Hasson Dent.

Solicitors for the respondent Bou Najem, Sanford Legal.

JDM



adeels palace pty ltd v moubarak 239 clr 420

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