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Howl at the Moon Broadbeach Pty Ltd v Lamble

 

[2014] QCA 74

Reported at [2015] 2 Qd R 11

 

SUPREME COURT OF QUEENSLAND

 

PARTIES:

FILE NO/S:

Court of Appeal

PROCEEDING:

General Civil Appeal

ORIGINATING COURT:

DELIVERED ON:

11 April 2014

DELIVERED AT:

Brisbane 

HEARING DATE:

17 March 2014

JUDGES:

Holmes and Muir JJA and A Lyons J
Separate reasons for judgment of each member of the Court, each concurring as to the order made

ORDER:

The appeal be dismissed with costs.

CATCHWORDS:

APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – RIGHT OF APPEAL – WHEN APPEAL LIES – ERROR OF LAW – WHAT IS – GENERALLY – where the respondent was standing outside the entrance to the Howl at the Moon nightclub when struck in the head with a long handled metal dustpan wielded by a barman employed by the appellant proprietor of the nightclub – where the respondent sued the appellant claiming damages for assault and battery, negligence and/or breach of duty on the basis that the appellant was vicariously liable for the barman’s conduct – where the primary judge found the appellant vicariously liable in negligence for the barman’s actions towards the respondent – where the primary judge assessed damages at $1,399,000 – where the appellant appeals against the judgment and associated order for indemnity costs – whether the primary judge erred in finding that the appellant was vicariously liable for the barman’s actions – whether the primary judge erred in making the order that the appellant pay the respondent’s costs on the indemnity basis

Uniform Civil Procedure Rules 1999 (Qld)

Deatons Pty Ltd v Flew (1949) 79 CLR 370; [1949] HCA 60, considered
Hollis v Vabu Pty Ltd (2001) 207 CLR 21; [2001] HCA 44, considered
House v The King (1936) 55 CLR 499; [1936] HCA 40, followed
Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244, considered
Lamble v Howl at the Moon Broadbeach Pty Ltd (No 2) [2013] QSC 262, considered
Nightingale v Cocker [1917] NZLR 433, considered
Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11, considered
Poland v John Parr & Sons [1927] 1 KB 236, considered
Ryan v Ann Street Holdings Pty Ltd [2006] 2 Qd R 486; [2006] QCA 217, considered
New South Wales v Lepore (2003) 212 CLR 511; [2003] HCA 4, considered

COUNSEL:

R J Douglas QC, with D Atkinson, for the appellant
G Diehm QC, with B Munro, for the respondent

SOLICITORS:

Barry Nilsson Lawyers for the appellant
Shine Lawyers for the respondent

[1] HOLMES JA:  I agree with the reasons of Muir JA and the order he proposes.

[2] MUIR JA: Introduction The respondent was standing in Niecon Plaza outside the entrance to the Howl at the Moon nightclub in Broadbeach on 8 December 2006 when struck in the head by a long handled metal dustpan wielded by Anthony Cerantonio, a barman employed by the appellant proprietor of the nightclub.  The respondent sued the appellant claiming damages for assault and battery, negligence and/or breach of duty on the basis that the appellant was vicariously liable for Mr Cerantonio’s conduct.  After a nine day trial, the primary judge found the appellant “vicariously liable in negligence for Anthony Cerantonio’s actions towards the [respondent]”[1] and assessed damages at $1,399,000.  The appellant appeals against the judgment and associated order for indemnity costs.  Quantum is no longer in dispute.

[3] As the notice of appeal challenges no specific findings of fact which bear on the question of liability, it is convenient to go principally to the primary judge’s reasons to ascertain the facts upon which the primary judge determined liability.  Where the facts are taken from other sources, reference to the appeal record is provided.

The nightclub business and Mr Cerantonio’s employment

[4] The nightclub was managed by Mr Cerantonio’s father, Luigi Cerantonio, and Mr Zulli.[2]  Mr Cerantonio was a university student at the time of the incident.  He had completed Year 12 in late 2005.  There was controversy over whether he had signed a document called “Company Policies & Procedures, Staff Induction Booklet, House Policy” described as “the house policy document”.  Under the heading “Security” the document provided:

“All staff are required to observe the principles of ‘Responsible Service of Alcohol’ – for the protection of both customers and employees. In the event that a customer becomes aggressive or violent, please avoid confrontation and immediately alert Security personnel or the Manager on duty.”

[5] The primary judge found it probable that Mr Cerantonio signed the document after the incident.[3]  He did not accept it “as evidence of the terms of his contract of employment insofar as it affects [Mr Cerantonio’s] capacity to engage in security work”.[4]

[6] The primary judge referred to the evidence of Mr Pickworth and Ms Barun.  It is desirable that I go to their evidence in a little more detail.

[7] At the time of the incident, Mr Pickworth was employed by a security firm and worked from time to time at the nightclub.  He described it as “more of a piano bar, more of a mixture of music, we were getting I suppose you’d call a tamer crowd”.  He said that on Friday nights there would be four security guards at the nightclub.  They were readily identifiable by their clothing.  He had been working at the nightclub for about 10 months prior to the incident and had not seen bar staff “get involved in crowd control” at that time.  He did not see Luigi Cerantonio or Mr Zulli engaged in crowd control either.

[8] Mr Pickworth’s evidence of the nature of the nightclub was supported by other evidence.  Mr Cerantonio described it as:[5]

“… a pretty safe place, with a predominantly female patronage and well lit. He had never previously been involved in an incident of violence nor had he seen another member of staff involved. He said there were normally four or five security guards who would look after unruly patrons and believed that there were about five on the premises on 8 December 2006.”

[9] Ms Barun worked on reception at the nightclub at the end of 2006, receiving payment and ensuring that patrons were looked after and went to the appropriate location in the nightclub.  She did not observe Mr Cerantonio being involved in crowd control.  On the evening of the incident, she saw Mr Zulli escort a patron from the premises.  Shortly after they left, she heard glass shattering and requested Mr Cerantonio to clean up the glass.  She had previously seen Mr Zulli escorting patrons from the premises and thought that she had also seen Luigi Cerantonio doing that.

[10] As there was some debate as to the import of the primary judge’s findings concerning the scope of Mr Cerantonio’s terms of employment in relation to security matters, it is desirable that I set out in full his Honour’s findings in that regard:[6]

“The [appellant’s] evidence was that members of the staff were regularly warned against taking on a security role themselves. It was curious that that rule needed regular reinforcement given the other evidence from employees of the [appellant] that the regular patrons of the establishment were generally well behaved. The [respondent] urged me to be sceptical of the [appellant’s] evidence about this issue but it seems likely to me that some verbal warnings were given to staff to leave security issues to the security staff. These warnings were also probably given to Anthony Cerantonio but it seems to me, as I shall discuss, were not such as to prevent his conduct from being sheeted home to his employer.” (emphasis added)

[11] After holding that the appellant was vicariously liable for Mr Cerantonio’s actions, the primary judge considered the issue of the appellant’s direct liability to the respondent.  The primary judge wrote:[7]

[74]The [respondent] also argued that the [appellant] breached its duty to the [respondent] as an occupier in, for example, failing to instruct Anthony Cerantonio not to involve himself in an altercation between patrons of the night club and other employees of the [appellant] and in allowing him ‘to carry the metal rubbish collector outside the [appellant’s] premises and towards the [respondent] with a view to doing him harm…’ …

[75]In my view, as I have said at [65], the probability is that there was some oral instruction to Anthony Cerantonio not to behave in the manner in which he did and to leave security issues to the security staff. That is consistent with the evidence from other witnesses such as Mr Pickworth and Ms Barun. The different example given by his father and Mr Zulli earlier that evening and by Mr Zulli on this occasion does not seem to me to be sufficient to overturn the general instruction to employees such as Anthony Cerantonio. There is no evidence that Anthony Cerantonio saw the earlier episode involving his father and uncle. Nor is there evidence that Mr Zulli’s actions in escorting Mr Gale out, even accepting that Anthony Cerantonio saw the violence accompanying it, should be treated as a general revocation of the earlier advice to bar staff. It may have provided some implicit encouragement to Anthony and Matthew Cerantonio’s behaviour in coming to their uncle’s aid but it did not revoke the general instruction. Accordingly I would not accept that the [respondent] has shown that the [appellant] had independently failed in its duty to the [respondent].” (emphasis added)

The incident

[12] In the course of the evening, it was reported to Luigi Cerantonio that a male patron had smashed a glass in the toilets and had threatened to “smash someone up”.[8]  When the man emerged from the toilets, Luigi Cerantonio put his arm around him and asked him outside.  The man was escorted out by security staff who were then fully engaged in restraining him until police arrived.[9]

[13] Mr Zulli gave evidence to the effect that, around the same time, he escorted a troublesome patron to another door of the club opening on to a different level of Niecon Plaza.  Contrary to his expectations, no security man was present at or near the door.  A person outside the door threw a bottle at him, which shattered on the wall beside him.  He then escorted the patron and another man who was with him out into the plaza.[10]

[14] A number of witnesses gave evidence of what then occurred in the plaza outside the nightclub.  As might be expected, perceptions differed.  Dealing with video footage of the incident, the primary judge said:[11]

[12][Mr Zulli] said that, after a bottle was thrown at him on the steps leading out of the club, he grabbed the person who had thrown it and put him in a headlock and he was then set upon by others. The video footage shown by the club’s CCTV indicates that the man in a red shirt, a Mr Brian Gale, and a man with blond hair in a black t-shirt, a Mr Hayden Vercoe, were first to exit the premises. Mr Zulli is shown in the video grappling with Mr Vercoe. The [respondent] then comes into the scene apparently from the exit to the club and behind Mr Zulli, Mr Vercoe and Mr Gale. That was consistent with Mr Zulli’s evidence that he did not recall [the respondent] being involved before, either in the bottle throwing incident or on the staircase. It seems likely, however, that [the respondent] must have followed his colleagues from Currumbin Roof Trusses down the steps fairly closely.

[13]That video also shows a guard, identified as one from another venue, at the scene, who was not involved in the fight. He appeared towards the end of the fight and that is consistent with footage from the Gold [Coast] City Council’s CCTV which shows a number of security guards rushing out from premises nearby and heading towards the scene of the fight towards its end.”

[15] The respondent was a foreman at Currumbin Roof Trusses and was at the nightclub to attend that firm’s Christmas party along with 15 to 20 other fellow employees.

[16] Referring to the respondent’s evidence in relation to the video footage, the primary judge said:[12]

[19]From that footage one can see staff of the [appellant] wrestling with Mr Gale, Mr Vercoe and the [respondent] on the footpath outside the nightclub. The [respondent] was wearing a blue shirt with white trousers which allows him to be distinguished from other people in the scene shown on the grainy CCTV footage. It is also possible to discern Anthony Cerantonio attacking the [respondent]. He can also be seen to collapse on the ground where he remained for quite some time until he was removed by an ambulance.

[21][The respondent] recalled one of his co-workers being restrained by security staff outside the bar, possibly a man called Steve Stewart. He agreed that Mr Gale tried to force his way outside through some glass doors towards where Mr Stewart was being dealt with by security staff. He observed Mr Gale go downstairs with Mr Zulli. He said he finished his beer while Mr Gale was escorted out and followed about two minutes later. He could not recall a bottle being thrown around the time he exited… He agreed that CCTV footage outside the bar showed himself, Mr Gale and Mr Vercoe struggling with Mr Zulli, that it appeared to be an angry looking fight and would be likely to have been seen by Anthony Cerantonio if he was coming down the staircase to exit the bar.”

[17] Referring to Mr Cerantonio’s evidence, the primary judge said:[13]

“Shortly after the incident he observed when the man was taken out through the glass doors upstairs, he was told by Ms Barun that there was some broken glass downstairs which he should clean up. He said that he grabbed his dustpan and brush, went down the stairs and cleaned up the entrance and saw something happening outside. He described a fight where his uncle Mario Zulli was on the floor and scuffling with two or three men beating onto him, grabbing and throwing him. He moved outside and went to try to break up the fight He said the fight stopped and started again. He grabbed the dustpan and swung it. He said that he did not think but just reacted. It was admitted on the pleadings that he hit [the respondent]. He said that he had been told at staff meetings to let security staff deal with issues of violence.”

[18] Mr Zulli’s evidence was to the effect that when he ejected a patron wearing a red shirt, he was set upon by “at least three to four” patrons “from the roof tilers Christmas party”.  He was then outside the premises.  This evidence by Mr Zulli was not contested in cross-examination.  It was put to him that he became aware that Mr Cerantonio came from the doorway of the nightclub and “apparently saw this incident going on in which [he was] involved in this scuffle, this fight”.  He agreed.  He agreed also that there were no security personnel around for Mr Cerantonio to alert.  Mr Zulli accepted that fighting of the nature of that which took place was not good for business and it was in the interests of patron safety that the fight be stopped as soon as possible.

[19] Mr Cerantonio’s evidence of the fracas was as follows.  After cleaning up the glass, he went to the entrance of the nightclub where he saw Mr Zulli:

“… on the floor and … a scuffle going on … there was (sic) two or three guys beating onto him, kicking him, grabbing, throwing … there was no-one there helping him, so obviously he was outnumbered and I went to try and break it up. I was obviously worried about my uncle, you know, outnumbered, he was copping a beating, and I just wanted to make sure he was okay … The fight had stopped. It started again, and as it went to start again, that's when I grabbed the dustpan and swung it.”

[20] The substance of this evidence was not challenged in cross-examination.

The primary judge’s findings on vicarious liability

[21] The primary judge’s findings which directly bear on his conclusions on vicarious liability are as follows:[14]

[69]The effect of exhibit 1A-24, the DVD from the [appellant’s] CCTV, is that Anthony Cerantonio is shown joining a struggle involving Mario Zulli and probably the [respondent] and his two workmates, Brian Gale and Hayden Vercoe. Matthew Cerantonio is seen heading to the struggle and is immediately joined by Anthony Cerantonio carrying the weapon eventually used by him against the [respondent]. The inference that may be drawn from these events, supported by his evidence in cross-examination, is that Anthony Cerantonio was engaged in an attempt to rescue Mario Zulli from a struggle arising out of his attempts to escort an unruly patron, Mr Gale, from the premises of the club where there were no security staff available because they were all upstairs. There was no suggestion that he was engaging in an act of private spite or revenge. He had not, on the evidence, engaged significantly with [the respondent] earlier in the evening. The only likely reason for his conduct was to assist to halt the brawl involving Mr Zulli. The brawl in fact stopped almost immediately after his attack on [the respondent].

[70]Even if Mr Zulli would normally leave such an exercise to the security staff, it would be an activity within the course of his employment as was demonstrated by his earlier behaviour that evening with the other patron taken outside upstairs. He was assisted in his dealing with Mr Gale by Anthony Cerantonio and Matthew Cerantonio who were entitled in these circumstances to follow his example. The mere fact that Anthony Cerantonio’s conditions of employment may have provided that he should defer to the security staff does not mean that what he was doing was not in the course of his employment, especially when no security staff were available.

[71]The fact that the [respondent] was not actively involved in the struggle when he was hit does not lead to the conclusion that this was an independently aggressive act by Anthony Cerantonio. There was no reason for him to do what he did except in a misguided attempt to rescue Mr Zulli in the emergency that had arisen. However misguidedly, he was seeking to advance the [appellant’s] interests in protecting one of its managers, his uncle, Mario Zulli. He was not acting in his own interests but in those of his employer. Although he should not have used the weapon, he did not persist with its use once the [respondent] went down. As was submitted for the [respondent] the blow appeared to have been calculated to stop the incident rather than being a ‘frenzied emotional outburst’. It is appropriate to describe his actions in context as carried out in intended or ostensible pursuit of the [appellant’s] interests in protecting Mr Zulli. That he may have principally wished to protect Mr Zulli because he was part of his family does not detract from the latter characterisation of his behaviour in the sense that it should not be said that he was engaged in a frolic of his own like the barmaid in Deatons v Flew.

[72]Alternatively there was a sufficient connection or a sufficiently close connection between what he did and his employment as to make it just that the [appellant] should be liable for the [respondent’s] injury. That what he did in the circumstances was inappropriate does not take it out of the category of case where he was defending his employer’s interests. Nor does the fact that the attack occurred just outside the club lead to the conclusion that his actions were not in the [appellant’s] interests. The [appellant] had an interest in preserving order outside its premises as well as in preserving its manager’s welfare.” (citations omitted)

The appellant’s contentions

[22] Counsel for the appellant challenged the primary judge’s conclusions on liability on the grounds that:

(a) the better view is that it is insufficient to attract vicarious liability that a worker intends to further the interests of his employer – there must also be a connection with the nature of the employment and one of sufficient character;

(b) in any event, there was no evidence, or insufficient evidence, to found an inference that Mr Cerantonio was in fact intending to further his employer’s interests at the time of the assault; and

(c) Mr Cerantonio was not acting within the scope of his employment and nor did the necessary connection exist.

[23] Reliance was placed on the following passage from the reasons of Gummow and Hayne JJ in New South Wales v Lepore:[15]

“231The answer given by Dixon J, in Deatons, was that the barmaid’s action was not

‘a negligent or improper act, due to error or ill judgment, but done in the supposed furtherance of the master’s interests. Nor [was] it one of those wrongful acts done for the servant’s own benefit for which the master is liable when they are acts to which the ostensible performance of his master’s work gives occasion or which are committed under cover of the authority the servant is held out as possessing or of the position in which he is placed as a representative of his master (see Lloyd v Grace, Smith & Co; Uxbridge Permanent Benefit Building Society v Pickard).’

It may be doubted that what Dixon J said was intended to describe exhaustively all the circumstances which would attract vicarious liability. The statement was made in connection with a claim that an employer was vicariously liable for an intentional tort. Nonetheless, there are two elements revealed by what his Honour said that are important for present purposes. First, vicarious liability may exist if the wrongful act is done in intended pursuit of the employer’s interests or in intended performance of the contract of employment. Secondly, vicarious liability may be imposed where the wrongful act is done in ostensible pursuit of the employer’s business or in the apparent execution of authority which the employer holds out the employee as having.

232What unites those elements is the identification of what the employee is actually employed to do or is held out by the employer as being employed to do. It is the identification of what the employee was actually employed to do and held out as being employed to do that is central to any inquiry about course of employment. Sometimes light may be shed on that central question by looking at a subsidiary question of who stood to benefit from the employee’s conduct. But that inquiry must not be permitted to divert attention from the more basic question we have identified. That is why, in Lloyd, Lord Macnaghten rejected the proposition that actual or intended benefit to the employer was a necessary condition of vicarious liability. Rather, in Lloyd, the determinative finding was, as we have noted earlier, that the fraudulent clerk was authorised by his employer to act for the firm in a class of matters including the conveyancing transactions which Emily Lloyd instructed him to effect. At trial Scrutton J had found that it was within the scope of the clerk’s employment to advise clients like Mrs Lloyd who came to the firm to sell property ‘as to the best legal way to do it, and the necessary documents to execute’. The fraud was held to have been committed in the course of that employment.” (citations omitted)

[24] Reliance was placed also on Ryan v Ann Street Holdings Pty Ltd,[16] in which Williams JA, Fryberg J agreeing, said:

“What emerges from the various judgments in Lepore is that the critical test, in broad terms, involves a comparison between the intentional wrongful conduct and the type of conduct the employee was engaged to perform. If there is a ‘sufficient connection’, or a ‘sufficiently close connection’, or a ‘close connection’, it will be open to the tribunal of fact to conclude that the wrongful act was done in the course of employment, albeit in an improper mode. The connection is of critical importance, and as Gummow and Hayne JJ noted at [217] where the opportunity for abuse becomes greater, so the risk of harm increases. Essentially that means that where an employer clothes an employee with authority which, if abused, could lead to great harm, then (the risk being known to the employer) the easier it will be for a court to draw the conclusion that the wrongful act was done in the course of employment.” (References omitted)

Consideration

[25] The emphasis of the appellant’s argument was on the “identification of what the employee [was] actually employed to do”.  Much was made of the instructions, which the primary judge accepted, were given to Mr Cerantonio about leaving security issues to the security staff.  That focus is too narrow.  Deatons Pty Ltd vFlew[17] concerned the liability of a publican for the conduct of a barmaid who threw beer from a glass into a customer’s face and then threw the glass which injured the customer’s eye.  Dixon J was prepared to accept that the publican would have been liable if “the barmaid’s action was an instinctive act of self-defence against an assault made upon her whilst she was doing, and because she was doing, what she was employed to do”.[18]  Dixon J also implicitly found that a master may be vicariously liable for acts to which:[19]

“… the ostensible performance of his master’s work gives occasion or which are committed under cover of the authority the servant is held out as possessing or of the position in which he is placed as a representative of his master (see Lloyd v Grace, Smith & Co; Uxbridge Permanent Benefit Building Society v Pickard).” (citations omitted)

[26] In Lepore, Gummow and Hayne JJ observed that Dixon J in Deatons identified two circumstances which may attract vicarious liability for the intentional tort of an employee:[20]

“… first, where the conduct of which complaint is made was done in the intended pursuit of the employer’s interests or in the intended performance of the contract of employment or, secondly, where the conduct of which complaint is made was done in the ostensible pursuit of the employer’s business or the apparent execution of the authority which the employer held out the employee as having.”

[27] Their Honours had earlier identified “the requirement that the [employee’s] wrongdoing [be in order to attract to vicarious liability] be legally characterised as having been done in the course of employment” as “an essential aspect of the rules about vicarious liability”.[21]

[28] Mr Cerantonio’s stated work in the nightclub was a “glassy”, doing “bits and pieces around the place, collecting glasses, cleaning dishes, stuff like that”.  He said that prior to 8 December 2006 he had been a bar manager but did not have that position on 8 December, although he opened the bar that evening and one of his duties was to serve drinks.

[29] The general performance of the normal functions of security staff was not within Mr Cerantonio’s terms of employment.  He had been instructed “to leave security issues to the security staff”.  I do not accept, however, that such an instruction covered all possible contingencies and, in particular, those in which security staff were not present or were otherwise unable to act in time to respond to an emergency.  The words emphasised in paragraph [11] hereof cannot be construed as a finding that Mr Cerantonio had actually been instructed not to engage in conduct of the nature of that involved in his attack on the respondent.  The words emphasised in paragraph [10] hereof contain the primary judge’s primary finding on point.  The emphasised words in paragraph [11] relate back to the primary finding as is apparent from the words “as I have said at [65]”.

[30] Mr Cerantonio was faced with a choice; act immediately and go to the aid of the endangered Mr Zulli or seek help from security staff.  If he chose the latter course, the risk that Mr Zulli would sustain further and potentially serious injuries would be substantially increased.  He made his choice and swung the dustpan at the respondent.  In so doing, he acted to protect another employee who was also a manager of the appellant’s business.

[31] The primary judge was right in finding that Mr Cerantonio’s actions were in the course of this employment.  It was in the interests of the appellant that Mr Zulli be aided and protected and that the fracas in which he was involved be stopped.  There was evidence to the effect, and it is obvious, that brawling outside a nightclub is likely to be off putting to patrons and potential patrons, particularly of the nature of those who formed the nightclub’s normal clientele.

[32] The appellant argued that there was insufficient connection between Mr Cerantonio’s responsibilities as an employee and his assault as the assault occurred in the mall outside the nightclub and his duties did not extend to performing acts outside the nightclub premises.

[33] Although Mr Cerantonio’s duties could normally be expected to be confined to the nightclub premises, it is improbable that it would not have been within the scope of his duties to clean up broken glass outside the front door or to clean the exterior of the door and its surrounds.  More significantly, there was a direct connection between the attack on Mr Zulli and the operation of the nightclub.  In the course of ejecting a troublemaker from the premises, Mr Zulli went outside the premises and was immediately attacked by supporters of the ejected patron.  Neither Mr Zulli nor Mr Cerantonio was engaged on a frolic of his own.  The attack on Mr Zulli was not a random attack by miscreants in a public place.  It was perpetrated by disgruntled nightclub patrons immediately outside the nightclub in a continuum of an incident within the nightclub.

[34] It was argued also that the level of violence employed by Mr Cerantonio was such that his act should be regarded as “a personal, independent act of the perpetrator”[22] rather than an act in the course of employment.  This argument cannot be accepted.  The force used was excessive but it was the product of the spontaneous reaction of an inexperienced youth to a situation which was extremely confronting.  It was not a random act of violence, its sole object being to assist Mr Zulli.

[35] It is relevant also that despite the relatively sedate nature of the nightclub’s clientele, the service of alcohol late at night gave rise to the risk that, despite the employment of security staff, bar staff may be faced with situations in which they needed to act in their own defence or in defence of other employees.

[36] In Hollis v Vabu Pty Ltd,[23] Gleeson CJ, Gaudron, Gummow, Kirby and Hayne JJ, discussing the rationale for the imposition of vicarious liability, said:

“In general, under contemporary Australian conditions, the conduct by the defendant of an enterprise in which persons are identified as representing that enterprise should carry an obligation to third persons to bear the cost of injury or damage to them which may fairly be said to be characteristic of the conduct of that enterprise. In delivering the judgment of the Supreme Court of Canada in Bazley v Curry, McLachlin J said of such cases that ‘the employer’s enterprise [has] created the risk that produced the tortious act’ and the employer must bear responsibility for it. McLachlin J termed this risk ‘enterprise risk’ and said that ‘where the employee’s conduct is closely tied to a risk that the employer’s enterprise has placed in the community, the employer may justly be held vicariously liable for the employee’s wrong’. Earlier, in Ira S Bushey & Sons, Inc v United States, Judge Friendly had said that the doctrine of respondeat superior rests ‘in a deeply rooted sentiment that a business enterprise cannot justly disclaim responsibility for accidents which may fairly be said to be characteristic of its activities’.”

[37] The relevant conduct of Mr Cerantonio was in the pursuit of the appellant’s interests and/or in the ostensible pursuit of the appellant’s business.

[38] Moreover, Mr Cerantonio acted in an emergency to protect an employee of the appellant acting within the scope of that employee’s duty.  In Poland v John Parr & Sons,[24] the Court of Appeal considered the liability of a master whose servant, in acting to prevent a boy stealing from the master’s wagon, struck the boy causing him injury.  It was held that the employee had an implied authority.  Atkin LJ observed:[25]

I am of the same opinion. With great respect to the learned judge I think his judgment goes wrong where he says ‘The blot, the failure in this case is that he [Hall] was not then in fact acting in the course of his employment .... nor was he in fact doing an act incidental to it.’ The learned judge took the view that the servant was not doing an authorized act, because he was not doing an act of the class which was expressly authorized, and therefore his act could not be authorized. Bank of New South Wales v. Owston shows that to be an erroneous view. The learned judge has not given enough weight to the consideration that a servant may be impliedly authorized in an emergency to do an act different in kind from the class of acts which he is expressly authorized or employed to do. Any servant is as a general rule authorized to do acts which are for the protection of his master’s property. I say ‘authorized,’ for though there are acts which he is bound to do, and for which therefore his master is responsible, it does not follow that the servant must be bound to do an act in order to make his master responsible for it.” (Citations omitted)

[39] The view that Mr Cerantonio had implied authority to act in the protection of Mr Zulli is also supported by observations of Mr P S Atiyah in Vicarious Liability in the Law of Torts.  After discussing Poland and Nightingale v Cocker,[26] the learned author observed:[27]

“Evidently, the steps taken in an emergency must bear some reasonable relationship to the end sought to be achieved otherwise authority to take those steps could not be implied. But once it is determined that there was implied authority, the reasonableness or otherwise of the steps taken are (except perhaps in very exceptional circumstances) largely irrelevant, for the unreasonableness of the servant’s conduct will only go to show that he has performed an authorised act in an improper way.

On the same principle a servant may, in an emergency, very well have implied authority to take reasonable steps to protect people present on the employer’s premises, at all event where they are present in the pursuance of a contract under which the employer is bound to exercise reasonable care for their safety.  So in a workman’s compensation case, it was held that a man employed on the defendants’ ship as a baker had implied authority to protect some lady passengers from insulting behaviour on the part of a third person.” (References omitted)

Conclusion

[40] For the above reasons, no error in the primary judge’s reasons was shown and the appeal should be dismissed.

[41] There is a remaining matter to be considered.  The primary judge ordered that the appellant pay the respondent’s costs on the indemnity basis.  The appellant submitted that the primary judge erred in so doing as the respondent had not made an offer under the Uniform Civil Procedure Rules 1999 (Qld) and, although the appellant’s offer to accept $1,350,000 was exceeded by the judgment for $1,380,164.60 with costs on the indemnity basis, that should not result in an indemnity costs order due to there being a genuine issue about vicarious and direct liability.

[42] In ordering indemnity costs, the primary judge had regard to the respondent’s offer, to the existence of a real contest as to vicarious and direct liability and a further contest as to the injuries alleged to have been suffered by the respondent in the subject incident.  The primary judge had regard as well to the appellant’s offer of $400,000 and to the “amount of time spent in litigating the issue about the house policy document”.[28]  The respondent attempted to prove that the house policy document, which is referred to in paragraphs [4] and [5] hereof, was signed by Mr Cerantonio before the time of the incident.

[43] On the trial, considerable time and effort were devoted to the appellant’s evidence in that regard and the respondent’s successful challenge to it.  Counsel for the respondent submitted that the record relating to the evidence concerning the house policy documents occupied some 40 pages.  Two expert reports were generated.  The documents signed by Mr Cerantonio and other employees were examined and witnesses, including the document examiner retained by the respondent, were cross-examined in relation to the authenticity and use of the documents.

[44] The primary judge expressed scepticism about the evidence of Mr Cerantonio about the date on which he claimed to have signed the copy of the document bearing his signature.  He concluded that this document exhibited, on its face, “evidence of masking and tampering”[29] as did the house policy document relating to Mr Matthew Cerantonio’s employment.  He found it likely that Mr Cerantonio had been in Victoria when the house policy documents in respect of Mr Cerantonio and Mr Matthew Cerantonio were witnessed by Mr Zulli.

[45] Costs may be awarded on a basis other than standard or “party and party” as a result of “some relevant delinquency on the part of the unsuccessful party”.[30]

[46] It would have been open to the primary judge to order costs on the standard basis and to penalise the appellant by ordering that it pay the costs referable to the house policy documents issue.  The question, however, is not what other orders were open to the primary judge or what order this Court would have made if in the position of the primary judge but whether in exercising his discretion, the primary judge: acted on a wrong principle; took into account irrelevant facts or considerations; failed to take relevant facts or considerations into account; or mistook the facts.[31]

[47] Error may also be shown if, although it is not apparent how the primary judge arrived at his decision, it is plainly unreasonable or unjust.[32]

[48] The appellant has failed to show that the primary judge erred in any of the above ways.  In deciding to award costs on the indemnity basis, the primary judge relied on a combination of matters including the appellant’s conduct in relation to the house policy document issue.  Of relevance in that regard was not merely the additional time and expense occasioned by it but the culpability of the appellant in relying on evidence which, being generous to the appellant, was found to be seriously flawed.  The primary judge was in a better position than this Court to know the extent of the appellant’s delinquency and the degree to which the house policy document issue impacted on the conduct of the case.

Conclusion

[49] For the above reasons, I would order that the appeal be dismissed with costs.

[50] ANN LYONS J:  I agree with the reasons of Muir JA and the order proposed.  I also consider that the primary judge was correct in finding that the actions of Anthony Cerantonio on the evening in question occurred in the course of his employment.  He was clearly acting in the interests of the employer and not acting in his own interests in attempting to intervene, although clumsily, in a fight which had erupted between his employer, who was also his uncle, and a patron his uncle had ejected from the nightclub minutes before.  It seems to me that the blow was indeed delivered with the intention of stopping the attack on his employer who was the manager of the nightclub where Cerantonio worked.

[51] Whilst Cerantonio may have been instructed to leave security issues to security I concur with Muir JA’s view that such an instruction could not be considered to cover all possible contingencies particularly if security staff were not present and an issue arose which needed to be dealt with immediately.  In the circumstances of this case Cerantonio was indeed faced with a situation where security guards were not in attendance and something needed to be done immediately to assist his employer who was obviously outnumbered and under attack.  Given the incident had been triggered by the removal of an unruly patron from the nightclub I am satisfied that there was a direct connection between the fight and the business of running a nightclub.

[52] I agree in all respects with his Honour’s reasons and the order proposed.

Footnotes

[1] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [73].

[2] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [4].

[3] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [58].

[4] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [58].

[5] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [26].

[6] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [65].

[7] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [74]–[75].

[8] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [4].

[9] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [6].

[10] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [7]–[8].

[11] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [12]–[13].

[12] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [19] and [21].

[13] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [28].

[14] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [69]–[72].

[15] (2003) 212 CLR 511 at 591–592.

[16] [2006] 2 Qd R 486 at [18].

[17] (1949) 79 CLR 370 at 381.

[18] Deatons Pty Ltd v Flew (1949) 79 CLR 370 at 380.

[19] Deatons Pty Ltd v Flew (1949) 79 CLR 370 at 381.

[20] New South Wales v Lepore (2003) 212 CLR 511 at 593–594.

[21] New South Wales v Lepore (2003) 212 CLR 511 at 588 [223].

[22] New South Wales v Lepore (2003) 212 CLR 511 at 540 [54].

[23] (2001) 207 CLR 21 at [42].

[24] [1927] 1 KB 236.

[25] Poland v John Parr & Sons [1927] 1 KB 236 at 244–245.

[26] [1917] NZLR 433.

[27] Atiyah, P S, Vicarious Liability in the Law of Torts, London, Butterworths, 1967 at 216.

[28] Lamble v Howl at the Moon Broadbeach Pty Ltd (No 2) [2013] QSC 262 at [9].

[29] Lamble v Howl at the Moon Broadbeach Pty Ltd [2013] QSC 244 at [57].

[30] Oshlack v Richmond River Council (1998) 193 CLR 72 at 89 per Gaudron and Gummow JJ.

[31] House v The King (1936) 55 CLR 499 at 505.

[32] House v The King (1936) 55 CLR 499 at 505.

Close

Editorial Notes

  • Published Case Name:

    Howl at the Moon Broadbeach Pty Ltd v Lamble

  • Shortened Case Name:

    Howl at the Moon Broadbeach Pty Ltd v Lamble

  • Reported Citation:

    [2015] 2 Qd R 11

  • MNC:

    [2014] QCA 74

  • Court:

    QCA

  • Judge(s):

    Holmes JA, Muir JA, A Lyons J

  • Date:

    11 Apr 2014

  • White Star Case:

    Yes

Litigation History

Event Citation or File Date Notes
Primary Judgment [2013] QSC 244 09 Sep 2013 -
Appeal Determined (QCA) [2014] QCA 74 11 Apr 2014 -

Appeal Status

{solid} Appeal Determined (QCA)