Author: Olga Voukidis   
Judgment Date: 16 July 2015
Citation: Aldred v Stelcad Pty Ltd [2015] NSWCA 201
Jurisdiction: NSW Court of Appeal [1]
In brief
  • Liability for injuries sustained by an entrant onto demised premises will primarily rest with the occupier-tenant.
  • The contractual relationship between the owner and the tenant of the premises needs to be examined in light of the terms of the lease and is determinative on the issue of breach.
  • The duty of a landlord is to be determined by reference to foreseeable risk of harm and what a reasonable person would do in response to that risk.
Background

David Aldred (the plaintiff) was injured on 20 October 2009, during the course of his employment as a forklift driver with Amerind Pty Ltd (Amerind), which carried on the business of selling timber veneer products.

Amerind was the tenant of premises situated at Ingleburn, NSW (the premises), pursuant to a lease (the lease) granted by Stelcad Pty Ltd (Stelcad), the owner of the premises.

The plaintiff brought proceedings against Stelcad for failing to provide a safe system of work by failing to rectify damage to the floor of the premises, which had deteriorated as a result of the activities carried out by Amerind’s forklifts. The plaintiff alleged that when he stepped off the forklift, his foot went into a hole in the concrete flooring of the warehouse, causing him to roll his ankle and fall onto his back.

District Court

Mahoney SC DCJ found that at the time the lease was granted, Stelcad did not know, nor should it have known, that the concrete flooring of the premises would become damaged over time by Amerind’s use of forklifts within the premises. Under the terms of the lease, Amerind’s obligations did not include responsibility for “fair wear and tear“, but as the tenant, it had to make good any damage caused by persons under its control and was obliged to give immediate notice to Stelcad, of any damage or injury occurring within the premises.

The plaintiff relied on a handwritten note (April Meeting Notes) taken following a meeting on 27 April 2009 which listed a number of repairs to be undertaken by Amerind, including repairs to the floor, which Amerind was responsible for repairing, but Stelcad was to obtain costings of the repairs.

The trial judge was not persuaded that on the basis of the April Meeting Notes, Stelcad was aware, or ought to have been aware, of any defect in the flooring of the premises that might give rise to a foreseeable risk of injury to employees of Amerind, during the course of their employment. His Honour considered that, under the terms of the lease, Stelcad was not under any relevant duty to take reasonable care to prevent a foreseeable risk of injury.

The trial judge held that the case, as pleaded, against Stelcad, reflected a duty of care owed by an employer/occupier and not by the owner of the premises. It was not foreseeable by Stelcad that defects in the floor would cause the plaintiff to suffer injury as he did. It was Amerind’s contractual obligation to repair the defects and it carried out those repairs following the plaintiff’s injury.

The trial judge concluded that if the plaintiff had been entitled to succeed against Stelcad in a cause of action in negligence, Stelcad would have been entitled to total indemnity from Amerind under s 151Z(2) of the Workers Compensation Act. His Honour found that Amerind owed the plaintiff a non-delegable duty of care, which was co-existent with any duty owed to him by Stelcad, as owner of the premises. As the terms of the lease created no contractual obligation on Stelcad to repair the flooring, it would have been entitled to total indemnity from Amerind.

Court of Appeal

Duty of care and breach of duty

The court considered that any duty owed by Stelcad to entrants onto the premises, such as the plaintiff, as an employee of Amerind, is to be determined by a reference to foreseeable risk of harm and what a reasonable person would do in response to that risk. The question in this case, is whether Stelcad was aware, or ought to have been aware of the deterioration in the concrete flooring of the premises and any attendant foreseeable risk of harm.

The court upheld the trial judge’s finding that there was no defect at the time the lease was granted and there was no basis to conclude that Stelcad ought to have been aware of the deterioration in the flooring by reason of the use of forklifts.

The April Meeting Notes merely recorded defects for which Amerind was responsible under the terms of the lease and the meeting was held for the purpose of considering whether the lease would be terminated, and did not give notice to Stelcad of any damage or defects in the premises, as was required under the terms of the lease.

Emmett JA, who gave the leading judgment, said that even if the April Meeting Notes came to the attention of Stelcad, Stelcad could not have been aware of the deterioration in the concrete flooring of the premises nor any attendant foreseeable risk of harm. His Honour did not consider the April Meeting Notes attracted a duty of care to the plaintiff on the part of Stelcad and, even if a duty was owed, there was no breach.

Implications

Where commercial premises are involved, the contractual relationship between the lessee and the lessor can be determinative of the issue of breach of duty of care.

One needs to look at the parties’ obligations under the terms of the lease as they can have a bearing on whether a duty of care is owed and, if so, whether there has been any breach.

Liability for injuries sustained by an entrant onto demised premises will primarily rest with the occupier-tenant as they have control of the premises and can determine who enters and under what conditions.

  1. Macfarlan JA, Emmett JA, and JC Campbell AJA.

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