Top Hut Banoon Pastoral Co Pty Ltd t/as Trustee for the Wakefield Family Trust v Walker (NSWCA 2021)

Link to Decision

Key Takeaways

• The duty of care owed by an employer to its employees is not absolute but to do what is reasonable in the circumstances.
• If a reasonable inspection of the premises would not have disclosed a defect that posed a risk of injury to an employee, then the employer will not be negligent.

Decision

The NSWCA has confirmed that ‘an employer who dispatches employees to other places or premises’ must take reasonable care to ensure that their employees are not exposed to a foreseeable risk of injury.

The employer’s duty is not an absolute duty to keep an employee free from injury but to exercise reasonable care.

The Court heard an appeal from a decision handed down in the NSWDC (see our Newsletter article July 2021) in which judgment was entered in favour of the worker and employer against an occupier of premises. The trial judge found that the employer had exercised reasonable care by observing the sheds and surroundings on a grazing property and that this did not extend to kicking or manipulating each step to reveal any potential defect that might pose a hazard to employees.

The worker was a shearers’ cook who was injured when she fell from a step to an accommodation hut that consisted of a plank of wood resting on two timber stump blocks. The worker had used the steps on several occasions earlier that day without incident but late that evening was returning to her room when she felt the step tip up causing her to fall to the ground, noticing that the step had broken.  

The worker sued the occupier of the premises for damages. The occupier admitted liability but brought a cross claim against the employer seeking contribution or indemnity on the basis that the employer had failed to take proper care for the worker by not carrying out a sufficiently careful safety assessment of the premises.

In determining the appeal, the Court confirmed that the scope of the employer’s duty, and what constitutes a failure to fulfil this duty, depends upon all the circumstances.

In this case, the accommodation on the property was used infrequently (about twice a year) and the condition of the building as known by the employer was that in the previous two years there had not been any problems with the accommodation or the steps leading up to any of the buildings at the premises.

The scope of duty required the employer to conduct a visual inspection of the property and there was no error by the trial judge in finding that a sufficient inspection had been performed. Mr Godde (for the employer) had passed by and glanced at the step to the accommodation hut at various times while unloading food stores from the trailer to the kitchen and did not notice anything amiss.

In cross-examination at the trial, Mr Godde disagreed with the suggestion that an inspection of the step would involve ‘just simply tapping it with your foot’; Mr Godde said he could not be expected to go around and inspect and tap every piece of timber throughout the quarters and shearing sheds.

The Court found that the evidence did not support the occupier’s submission on appeal that because of the rudimentary and rustic nature of the buildings, the employer ought to have known that the condition of the step was unstable or likely to collapse or had a ‘propensity to collapse’.

Further, the Court determined that there was no error by the judge in finding that a physical inspection of the step would not have revealed the defect, given that the worker was 93kg and had previously walked on the step and not noticed any instability.

Guiding principles

The Court referred to the summary of the principles set out in an earlier decision Dib Group Pty Ltd Trading as Hill & Co v Cole (NSWCA 2009) where it was stated:

The modern case law with respect to the duty of employers which despatch employees to other places or premises, may be seen to commence with the judgment of Lord Denning in Smith v Austin Lifts Ltd (WLR 1959), where his Lordship stated:

‘Notwithstanding what was said in Taylor v Simms & Simms (1674 LT 414), it has since been held, I think rightly, that employers who send their workmen to work on the premises of others cannot renounce all responsibility for their safety. The employers still have an over-riding duty to take reasonable care not to expose their men to unnecessary risk. They must, for instance, take reasonable care to devise a safe system of work …; and if they know or ought to know of a danger on the premises to which they send their men, they ought to take reasonable care to safeguard them from it. What is reasonable depends, of course, on the circumstances.’

Smith v Austin Lifts Ltd was applied by this Court soon after it was delivered, in Sinclair v William Arnott [Pty Ltd; Kell & Rigby Pty Ltd (Third Party) (No 2) (1963) 64 SR (NSW) 88]. The judgment of the Court, delivered by Walsh J, stated at 92:

’The principle … to be derived from the authorities is that the duty of care is recognised as existing where employees are sent to work in another’s premises, and that what constitutes a failure to fulfil this duty must depend upon all the circumstances.’

As to the relevant circumstances, it was said in Dib Group at [54]:

‘The employer’s duty, however effected, to adopt safe systems of work and to provide proper plant and equipment, will operate differently on its own premises and in circumstances over which it has full control, as compared with premises under the control of others and circumstances over which it does not have control. Where the safety of premises is at stake, as in this case, it is appropriate to ask quite specific questions with respect to what may be expected of an employer exercising reasonable care for the safety of its employees. For example, is it reasonable for the employer to request or require access to premises to carry out its own safety inspection? Is it necessary (and sufficient) if the employer inquires of the occupier what steps it has taken to conduct such an assessment? Is it necessary (and sufficient) for the employer to inquire in specific terms of its own employees as to the nature of the conditions they encounter at other premises?’

Implications

As is often the case in the modern industrial setting, employers are increasingly required to send their employees to places away from the employer’s workplace to sites and premises where they may potentially be exposed to unknown hazards that pose a risk of injury.

Third party defendants often raise allegations of employer negligence on cross claims or as part of their defence to a worker’s damages claim seeking to apportion any liability between them and the employer pursuant to s151Z(2) of the Workers Compensation Act 1987 whether or not any contribution is actually payable by the employer.

This decision provides some guidance to what can be expected of employers in the circumstances to satisfy the duty of care that they owe to their employees to ensure their safety.

Undoubtedly, the measure will continue to be tested in litigation arising from workplace injuries where third party occupiers seek to ascribe some degree of responsibility to employers.