APPEAL COURT OVERTURNS DECISION ON LIABILITY FOR CRIMINAL ACTS OF THIRD PERSON

Legal Directions

Optus Administration Pty Ltd v Glenn Wright by his tutor James Stuart Wright [2017] NSWCA 21

Background

In our Legal Directions dated 7 May 2015, we reported on the above decision, which found Optus Administration Pty Ltd (Optus) liable for psychological injuries caused as a result of an assault on Mr Glenn Wright, who was attending its premises for training.

As we reported, Wright and Nathanial George were both undertaking training provided by Optus for work in an Optus call centre. Neither Wright nor George had met each other prior to the training day. There was no suggestion of any animosity between the two men, and they had very little contact with each other.

Wright was employed by IPA Personnel Pty Ltd (IPA), a labour hire company.

The training took place at Optus’ premises, a building which had four storeys. Unknown to Wright, George had the intention of killing someone. This intention had been passed on to another person the day prior and did not eventuate.

On 15 March 2001, George asked another trainee to hand a note to Wright, asking Wright to follow him. Wright was later approached by another trainee, who orally advised Wright that George wanted to see him on the roof. Both requests were ignored by Wright. A trainer employed by Optus (Ms Hedges) ascertained that George was on the roof and formed the view that he may have been under the influence of drugs. She then informed a manager (Mr Williams) and they both approached George on the roof. George advised that he wished to see Wright. Williams wrongly assumed that Wright and George were friends, and directed Wright to see George on the rooftop. Wright advised that he did not know George and did not wish to become involved; however, the trainer persuaded him to attend the rooftop.

When Wright attended the rooftop, George attempted to throw Wright off the railing. When unsuccessful, George then proceeded to punch Wright in the head. The manager intervened and restrained George. Wright developed a severe anxiety disorder with secondary depression and post-traumatic stress disorder.

Decision at first instance

Wright argued that while he was undertaking the training course, he was under the direction, supervision and control of Optus. Optus denied liability to Wright and contended that the only relationship was that of occupier of the premises. His Honour Justice Campbell considered the personnel agency agreement between IPA and Optus, which included terms that while at the course, Wright was subject to work during the hours specified by Optus and was subject to the direction and control of Optus.

His Honour found that the duty of care owed by Optus was analogous to that of an employer and employee, despite both George and Wright being employed by labour hire companies. His Honour found that Optus’ duty of care to Mr Wright extended to taking reasonable care to protect him from the criminal actions of others in the workplace. He found that it was reasonably foreseeable that George might assault Wright and that a person might suffer a recognised psychiatric illness if reasonable care was not taken.

His Honour found that the risk was not insignificant and that a reasonable person in Optus’ position would not have put Wright in harm’s way.

On appeal

The issues on appeal were as follows:

  1. Whether Optus owed any duty of care to Wright not to cause him mental harm;
  2. Whether the foreseeability requirement was satisfied, in that Optus ought to have foreseen that a person of normal fortitude might – in the circumstances of the case – suffer a recognised psychiatric illness if reasonable care was not taken;
  3. Whether Optus breached any duty that it owed to Wright;
  4. Whether the reasonable response was to remove George from the premises and not to allow other workers to approach him;
  5. Whether Optus was vicariously liable for the actions of Ms Hedges or Mr Williams.

Justices Basten and Hoeben (with Gleeson JA dissenting) found that:

  1. The primary judge impermissibly aggregated the knowledge of various employees of Optus and then attributed that knowledge to the corporate employer for the purpose of demonstrating negligence on the part of Optus;
  2. Optus was under no duty to take reasonable care to protect Wright against mental harm, with Wright failing to satisfy the requirements of s32 of the Civil Liability Act 2002 (NSW), which provides there is no duty of care not to cause mental harm, unless the defendant ought to have foreseen that a person of normal fortitude might, in the circumstances of the case, suffer a recognised psychiatric condition if reasonable care was not taken;
  3. It was not probable that any of Optus’ staff knew or should have known that George might attempt to kill or assault Wright in a manner that would cause Wright to suffer a psychiatric illness.

 

The critical question in identifying the scope or content of duty owed by Optus was to identify the risk that might give rise to mental harm, particularly in circumstances where the alleged mental harm resulted from an attack by a third party. In other words, it was necessary to identify with some precision the nature of the conduct which Optus should have foreseen.

Basten J held that the relevant question was whether it was reasonably foreseeable that one trainee might assault another in a manner which, although it caused no physical injury, might nevertheless be so serious such as to lead to a psychiatric illness in a person of normal fortitude?

The duty depended upon the conduct of George in seeking to kill Wright. It was this conduct that Optus should have foreseen, which might cause a person to suffer a psychiatric illness. Without a finding of foreseeability of such conduct, Optus was under no relevant duty to take reasonable care to prevent such conduct.

It was also held that the requirement that a reasonable person ought to have foreseen that a person of normal fortitude might suffer psychiatric illness if reasonable care were not taken was an important factor to consider. This was due to the fact that different circumstances would give rise to different possible levels of mental harm and, as such, the nature of the possible consequences of George’s actions was important. This exercise was only undertaken by the trial judge in addressing the question of breach of duty, where he identified the event against which foreseeability of mental harm was to be assessed as the risk that George might assault Wright.

The trial judge referred to the evidence provided by a number of experts, including a psychiatrist, and found that the situation that developed relating to George’s behaviour was unusual and that it would be unreasonable to expect that Mr Williams would be able to refer to a manual in order to ascertain how to manage the situation. Basten J found that the evidence did not rise to the relevant standard. George’s conduct was found to have been unexpected and Optus’ employees did not consider that he might try to kill Wright. It was noted that the evidence that George appeared to be affected by drugs was considerably different to anticipating that he would try to kill Wright. It was held that, based on the evidence, it was not open to the trial judge to find that a violent attack was foreseeable, or that it was foreseeable at that time or that Optus should have foreseen that George might attempt to kill Wright or otherwise cause him serious injury, such as psychiatric illness. His conduct was found to have been completely unexpected.

Basten J also held that there was no basis in law which would allow a finding that Optus owed a duty of care to Wright resulting from an aggregation of the knowledge of different (non-supervisory) employees. Even if a duty could arise on this basis, it was determined that Optus would not be found liable for the conduct of employees who were not themselves negligent.

Conclusion

This decision gives guidance to liability insurers of occupiers (including host employers) on the duty of care owed to visitors with respect to the criminal acts of third parties.

The critical question in identifying the scope or content of duty owed is to identify the risk that might give rise to mental harm, particularly in circumstances where the alleged mental harm resulted from an attack by a third party. It is necessary to identify with some precision the nature of the conduct which should have been foreseen. If the nature of the criminal conduct is unexpected and not foreseeable, no duty to take reasonable care to prevent the criminal conduct which gives rise to injury is owed.

Authored by Anna Chacko, Associate and Kerry Wood, Partner, Perth.


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