New Development in Liability of Hoteliers to Patrons By Benjamin Buckhurst | February 2009 Area of Expertise | General Insurance
Summary The Tasmanian Court of Appeal has held that situations can arise where a hotel and its licensee can owe a duty of care to patrons who become intoxicated, distinguishing the New South Wales Court of Appeals’ ruling in South Tweed Heads Rugby Football League Club Limited v Cole [2002] 55 NSWLR 113 and applying the later decision of the High Court in that matter. In this case the hotel and its licensee were found to be negligent in returning the keys of a motorcycle to a patron who drank at the hotel for some three hours beforehand.
Who Does This Impact? The ruling is of importance to insurers and operators of hotels and other licensed premises.
What Action Should Be Taken? The ruling underlines the importance of carrying out detailed investigations into matters involving intoxicated patrons and treating the fact of intoxication as only one factor in determining negligence and what would constitute reasonable care in all the circumstances. In light of this ruling, insurers should not assume that operators of licensed premises will escape liability if a person brings an action claiming negligent service of alcohol. Insurers should make detailed enquiries encompassing the following: • The hotel’s practices of dealing with intoxicated patrons. • The level of patronage at the hotel at the time of the incident. • Obtain detailed statements from witnesses regarding objective signs of intoxication that the Plaintiff might have exhibited, such as slurred speech, being argumentative or unsteady gait.
Scott v CAL Number 14 Pty Ltd [2009] TASSC2 A recent judgment of the Tasmanian Court of Appeal has reinforced that the ruling of the New South Wales Court of Appeal in South Tweed Heads Rugby Football League Club Limited v Cole about the scope of the duty of care owed to an intoxicated patron should be treated with caution.1 The Chief Justice of the Supreme Court of Tasmania identified the principal question arising in the appeal as whether the operator of a hotel and its licensee owed a duty of care to a patron who had become intoxicated at the hotel, to prevent him leaving the hotel on a motorcycle while so intoxicated.
Facts On the afternoon of 24 January 2002, Shane Scott (the Deceased) rode from his place of work on his wife’s motorcycle to the Tandara Motor Inn in Triabunna, Tasmania (the Hotel). Mr Kirkpatrick, the licensee, served the Deceased alcohol for approximately three hours before refusing him further service on the grounds of intoxication2. Despite his expressed intention earlier in the evening to be
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collected by his wife the Deceased decided in the end to ride the motorcycle home. He died that evening when he ran off the road and collided with the guardrail on approach to a nearby bridge. His widow, Sandra Scott, sued the Hotel and its licensee, alleging negligence. She was unsuccessful at trial but successful on appeal by a two to one majority, with the Chief Justice dissenting. The Deceased attended the Hotel at approximately 5:15 pm. He was initially served by Mr Kirkpatrick’s wife. Mr Kirkpatrick commenced serving the Deceased at 5:30 pm. There was talk in the bar of a breathalyser unit being erected nearby. In the context of the Deceased’s expressed intention to be collected by his wife, a decision was made between the Deceased and Mr Kirkpatrick to store the motorcycle in a store room at the rear of the Hotel. Mr Kirkpatrick opened the storeroom from inside the hotel and the Deceased placed the motorcycle inside before giving the motorcycle keys to Mr Kirkpatrick, which he then put in a petty cash box behind the bar. There was an arrangement that the Deceased would continue drinking and would call his wife to pick him up when he was ready to leave. The Deceased left the Hotel at approximately 8:30 pm, shortly before the accident.. During the three hours in which he was drinking at the Hotel in the company of Mr Kirkpatrick, it was found that he had consumed eight 375ml cans of Jack Daniels and Cola. The Deceased was alone in the bar towards the end of his stay, with the exception of another female patron who spoke with him briefly. During that time he rested his head on the bar a number of times. The Deceased started arguing with this woman and at that point Mr Kirkpatrick told him that it was time for him to leave. He asked the Deceased for his wife’s telephone number in order that he could contact her and have her pick him up from the Hotel. The Deceased replied in an aggressive and abusive manner, stating in a nutshell that if he wished to call his wife that he would do so. The Deceased then walked outside the Hotel for a time and then returned and asked for his keys. Mr Kirkpatrick asked him a number of times if he was ‘right to ride’. The Deceased answered that he was fine and that he wished to leave. Mr Kirkpatrick gave him the keys to his motorcycle and he left.
The Decision of the Court Justice Evans, in the lead judgment,, first looked at the High Court’s ruling in Cole v South Tweed Heads Rugby Football League Club Limited3. Justice Evans noted that Gleeson CJ found that it was unnecessary to formulate a general proposition whether in any, and if so what, circumstances a supplier of alcohol was under a duty to take reasonable care to protect a consumer against the risk of physical injury resulting from consumption of that alcohol. This was used as justification to examine the factual issues and determine the scope of the duty of care owed in the context of this case. Evans J noted the following matters which gave rise to a different scope of the duty of care owed by the Hotel to the Deceased that would ordinarily apply: •
Mr Kirkpatrick was serving the Deceased over the course of the evening. When he started serving at the bar there were 6-8 people present and by 7:15 pm the Deceased was 1 of 2 people in the bar and after that the Deceased was the only person present in the bar. Consequently Consequently,, it was much easier for Mr Kirkpatrick to monitor the amount of alcohol consumed by the Deceased.
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•
Mr Kirkpatrick had formed an arrangement with the Deceased before he commenced drinking that the keys were to be held by Mr Kirkpatrick and that the Deceased would telephone his wife to pick him up after he had finished drinking.
•
When the Deceased changed his mind and asked for the keys in order to drive home, Mr Kirkpatrick had the Deceased’s keys in his possession.
•
Mr Kirkpatrick could therefore control the manner in which the Deceased was to leave the hotel.
•
Further, Mr Kirkpatrick would have been in an excellent position to determine that the Defendant’s safety would be at risk due to his excessive alcohol consumption.
•
This was further compounded by the fact that Mr Kirkpatrick had refused to continue serving the Deceased after he became abusive.
Due to these factors, Evans J found that the relationship between Mr Kirkpatrick and the Deceased took on an entirely different guise to the usual relationship between a hotelier selling alcohol to a patron,, because Mr Kirkpatrick could control the manner in which the Deceased was to leave the hotel. Mr Kirkpatrick would have been aware that if the Deceased attempted to leave the Hotel on his motorcycle after a protracted drinking session, then he would run the risk of harming himself or others or at least rendering himself liable to prosecution. Evans J considered that this likelihood of harm created a more stringent duty of care on the part of the Hotel. Consequently, he found that the duty of care imposed upon the publican and the hotel was to take reasonable care to avoid the Consequently, Deceased driving from the hotel whilst intoxicated. Mr Kirkpatrick, it was found, should have known that when the Deceased demanded his keys that this would have been a highly irresponsible request and therefore the situation demanded a reasonable response. The reasonable care required from Mr Kirkpatrick in this case would have been for him to have again offered to telephone the Deceased’s wife and ask her return to the hotel to pick up the Deceased. This could have been done either with the Deceased’s knowledge or surreptitiously. Mr Kirkpatrick had spent most of his working life behind the bar in country hotels and it was not unusual in his experience to ring the wives of inebriated customers and ask for them to pick up their husbands. Further, Mr Kirkpatrick had the keys to the motorcycle and storeroom. It was considered by the Court that it would have been simple Further, and easy to stall the Deceased. The Plaintiff had been aggressive to Mr Kirkpatrick when he asked the Deceased if he wanted him to call his wife. Evans J was of the view that firstly there should have been more resistance by Mr Kirkpatrick and if there had been a threat of force, then it may have been reasonable for Mr Kirkpatrick to have handed over the keys. However However,, he was not satisfied that the Deceased would have reacted violently if he had refused to return the keys. The court was satisfied that if Mr Kirkpatrick had resisted handing over the keys, then the Deceased would not have left on his motorcycle and the incident would have been averted. It was also raised that Mr Kirkpatrick had no legal basis to withhold the keys. He could have been liable to civil or criminal action if he resisted the Deceased’s demand for the keys. The Court determined that this was an attempt to justify actions properly characterised as negligence. Evans J commented that the Deceased and Mr Kirkpatrick were not concerned with notions of illegality at the time
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the keys were released. Further Further,, he did not consider that these issues affected the reasonableness of Mr Kirkpatrick’s actions in handing over the keys and were only one factor to be taken into account.
Implications The above ruling in effect warns defendants not to make assumptions about the state of the law regarding torts involving the intoxicated. Intoxication is only one factor to be considered when examining the liability of publicans. Other factors to be examined will be the nature of the hotel itself. Rural hoteliers tend to have smaller crowds of people and will know their regular patrons better than their city counterparts. In rural areas, public transport is less available and patrons have a greater temptation to drink and drive. Further Further,, the court will be interested in what practices may exist in these hotels. In the present case, the Court noted that Mr Kirkpatrick had a practice of calling intoxicated patrons’ wives and asking them to remove their husbands when they became difficult. The ruling also highlights how courts will look at the conduct of tortfeasors and interpret their actions at the time of the commission of tortious acts. Retrospective legal justifications for negligent actions will not always act as a complete defence. Whilst relevant, these considerations will not be determinative, particularly when they were not in the contemplation of the parties at the time of the negligent act. Endnotes 1
In South Tweed Heads Rugby Football League Club Limited v Cole [2002] 55 NSWLR 113 it was held that a publican’s duty of care to a customer does
not generally require the taking of care to prevent harm caused by the customer’s own intoxication – on appeal to the High Court (see endnote 3) there was a divided view on this point and so the view of the Court of Appeal on this was not overruled. The word ‘generally’ is where the subject Tasmanian decision comes into play. 2
At the time of his death, he had a blood alcohol concentration of 0.253.
3
Cole v South Tweed Heads Rugby Football League Club Limited (2004) 217 CLR 469.
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For more information, please contact:
Benjamin Buckhurst Lawyer T: 03 8600 5007 benjamin.buckhurst@turkslegal.com.au
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