New South Wales Court of Appeal CITATION : MACKINNON v. THE PROPRIETORS STRATA PLAN NO. 14311 [2000] NSWCA 81 FILE NUMBER(S) : CA 40689/98 HEARING DATE(S) : 30 March 2000 JUDGMENT DATE : 30 March 2000 DAWN THERESE MACKINNON (Appellant/Opponent/Cross-Respondent) PARTIES : THE PROPRIETORS STRATA PLAN NO. 14311 (First Respondent) OLGA LILLIAN HANLON (Second Respondent/Claimant/Cross-Appellant) JUDGMENT OF : Priestley JA at 41; Handley JA at 43; Powell JA at 1 LOWER COURT JURISDICTION : District Court LOWER COURT DC 3186/97 FILE NUMBER(S) : LOWER COURT Balla A-DCJ JUDICIAL OFFICER : M.R. Aldridge SC and N.M. Carney (Appellant) COUNSEL : R.E. Lee (First Respondent) R.C. Tonner (Second Respondent) Warren F. Ball & Co. (Guildford) (Appellant) SOLICITORS : Phillips Fox (First Respondent) Adrian Batterby (Second Respondent) CATCHWORDS : COSTS - General rule - Costs follow the event - NEGLIGENCE - Duty of care - Occupier's liability - When duty arises - Extent of duty of care ND DECISION : (1) Appeal Dismissed; (2) Leave to Cross-Appeal granted; Cross-Appeal allowed 10 IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40689/98 DC 3186/97 PRIESTLEY JA HANDLEY JA POWELL JA 30 March 2000 MACKINNON v. THE PROPRIETORS, STRATA PLAN NO. 14311 JUDGMENT 1 POWELL JA: There are listed today an Appeal from a Judgment delivered and verdicts entered by Balla A-DCJ in the District Court on 21 August 1998 and a Summons for Leave to Cross-Appeal and, if leave be granted, the Cross-Appeal from an order for costs made by her Honour on the same day. 2 The proceedings arose out of an accident which occurred on 26 September 1992 at a property known as Villa 10, 164 Culloden Road, Marsfield, at a time when the present Appellant, who was the plaintiff in the proceedings in the District Court, was leaving that property. As she did so, she, so it would seem, missed her step when proceeding from a small porch outside the front door of the property before reaching a porch one step lower which then led down by a set of steps to the common property of the property which was the subject of a Strata Plan registered No. 14311. 3 In her Statement of Claim, the Appellant joined two defendants, the first being the body corporate known as The Proprietors of Strata Plan No. 14311 ("the Body Corporate") and the second being the registered proprietor of the lot representing Villa 10 on the Strata Plan ("Mrs. Hanlon"). 4 The particulars of negligence which the Appellant alleged against the Respondents were many and varied; so far as is now relevant to the proceedings, it was alleged that the Respondents, or one of them, failed to take any, or any reasonable, care for the safety of the Appellant; failed to install suitable lighting in the vicinity of "the balcony", which is the porch to which I have referred; caused, allowed and permitted a step to be disguised in its surroundings by reason of a pebblecrete surface and lack of any adequate lighting; and failed clearly to mark, or cause to be marked, the step in question. 5 On the day in question the Appellant, her husband and an acquaintance went to the property to discuss some matters with Mrs. Hanlon's son, the Appellant's husband and their acquaintance apparently being members of what is described in the proceedings as the Coastguard - which I take to mean the Volunteer Coastal Patrol - of which organisation Mrs. Hanlon's son appears also to be a member. When they arrived, it was about 1.30 in the afternoon and their business continued until some time after 5.30 in the afternoon. It is said that, at that time, there was a storm approaching and the light was less than it had been when they first arrived at the property. 6 The Appellant's case was, as I have foreshadowed, that, as she left the property, she missed her footing at the first step and tumbled over and did herself the injury in respect of which she sought to recover in the proceedings. 7 The evidence which the Appellant gave as to the circumstances is, if I may say so, not particularly revealing, but it is appropriate that I record it. The Transcript at page 11 in the Combined Blue/Black Book records: "Q. All right, what happened? A. Well, I went through the door and I went to go out … Q. Were you by yourself? A. By myself and I went to just proceeded to go out and I just didn't see the first step which was hardly discernible because it was pebblecrete and I just thought that that first landing where you go out of the door goes straight to the far wall and then there was steps down but I didn't know that there was a step before the steps so I just missed it and so I fell down the steps and I ended up sort of lying on my back with my legs up the steps. ……… Q. Tell us again, how much light was there in terms of daylight? A. Well it wasn't black so it was just overcast and dim." 8 The Appellant's husband who, having heard the Appellant call out, gave evidence in support of her case. The Transcript records the following evidence in chief (Combined Blue/Black Book p. 45): "Q. What's your recollection of the light, that is th4e daylight or any other light about the time you rushed out after hearing your wife scream? A. It was a dull, overcast day but there was good light, good enough to be able to see exactly what had happened. It was 20 minutes or so before it started to get dark, that's when Mrs. Hanlon had arrived home." 9 I record those pieces of evidence because of one of the statements which her Honour made in the Judgment which she was later to deliver. 10 As will appear from what she said in her evidence in chief, the Appellant's case was that, because of the conditions at the time and because of the pebblecrete coating on each of the landings and the steps which went from the lower landing down to the common property, she was unable to discern that there was in fact a step. That that might have been so at the time seems to have been accepted by her Honour in the course of her Judgment. However, the photographs which were tendered in evidence make it transparently clear that, in normal times, despite the pebblecrete finish being applied to both the landings and the steps, the step down which caused the plaintiff to lose her footing was readily discernible. 11 Regrettably, there has been a great deal of procedural confusion attending the proceedings. 12 On 30 July 1996, the Appellant entered into a Deed of Release with the Body Corporate, pursuant to which, in consideration of the Body Corporate paying and bearing its own costs of the proceedings, the Appellant released the Body Corporate from all liability. 13 On the same day the Appellant filed a Notice of Discontinuance in respect of the Body Corporate, which Notice of Discontinuance was, however, not consented to by Mrs. Hanlon's solicitor (see DCR Pt. 18 rr. 1,4). 14 However, at some time thereafter, Mrs. Hanlon filed a Third Party Notice in which she sought to recover from the Body Corporate, as a third party, indemnity from, or contribution toward, any damages for which she might be held liable to the Appellant. 15 As a result of that being filed, the Body Corporate then raised a cross-action against the Appellant seeking, in the event of the third party proceedings being successful, to recover indemnity from the Appellant. 16 This then led the Appellant to apply - on what possible basis completely escapes me - to have the District Court set aside the Deed of Release. 17 That having been done, Mrs. Hanlon then applied to the District Court to have the Notice of Discontinuance that had been filed declared a nullity and set aside. 18 Those two applications came before Hughes A-DCJ in September 1997, on which occasion, so it would appear, his Honour ordered that the Deed of Release be set aside and, as well, ordered that the Notice of Discontinuance be set aside. 19 Those orders in turn led to an application by the Body Corporate to this Court for leave to appeal. 20 That application came before Priestley JA and myself on 22 September 1997 and there were then entered Consent Orders which, so far as is relevant were: "(3) Order that so much of the appeal against the judgment of Hughes A-DCJ made on 1 August 1997 setting aside a deed of release dated 30 July 1996 be allowed. ……… (5) Order that so much of the appeal against the judgment of Hughes A-DCJ made on 1 August 1997 setting aside a notice of discontinuance dated 30 July 1996 be dismissed." 21 When the proceedings came on for hearing before her Honour in June 1998, the position thus was that the Body Corporate remained a defendant to the proceedings as well as being the third party to Mrs. Hanlon's Third Party Notice and a Cross-Claimant, while Mrs. Hanlon was a defendant and was seeking relief on the Third Party Notice. 22 At the outset of the hearing, counsel then appearing for the Appellant advised her Honour in a rather confused way, I regret to say, of what had occurred before Hughes A-DCJ and before this Court and then indicated to her Honour that the Appellant did not propose to proceed against the Body Corporate. Nonetheless, because it was a third party, the Body Corporate remained represented at the hearing. 23 The bulk of the first day's hearing was devoted to evidence on the action, directed primarily against Mrs. Hanlon while the second day's hearing was, for the most part, devoted to evidence led on behalf of Mrs. Hanlon seeking to establish the grounds of relief sought in the Third Party Notice. 24 At the end of the second day, following submissions, her Honour reserved her judgment. 25 In her Judgment, her Honour, after recounting the facts in the course of which she expressed a general acceptance of the evidence of the plaintiff as to the circumstances in which the accident occurred - then turned to the questions which she saw arising before her. Having indicated that the claim against Mrs. Hanlon was based on the law which is generally described as occupier's liability, her Honour posed for herself the questions for determination which were: (1) whether a reasonable person in Mrs. Hanlon's position would have realised that her conduct involved a risk of injury to the Appellant or a class of persons including the Appellant; and (2) if so, what would a reasonable person do in response to the risk - this, her Honour said, would involve a consideration of the magnitude of the risk and the degree of probability of its occurrence, along with the expense, difficulty and inconvenience of taking alleviating action and any other conflicting responsibilities which "the Plaintiff" (sic) might have. 26 Turning to the first question, her Honour said (RAB 27): "It is common ground however that darkness was falling and the witnesses have conceded that the area was dark. The Second Defendant conceded that it could sometimes be difficult to see the change in level. She also conceded that it would not have been much trouble to put tape on the stairs and use a spray can and conceded that her neighbour had installed an automatic light." 27 As to the first of these matters, the evidence of both the Appellant and the Appellant's husband, to which I have referred, as well as the evidence of Mrs. Hanlon's son, as it seems to me, would not support her Honour's statement that it was common ground that darkness was falling and the witnesses conceded that the area was dark; nor, so it seems to me, was her Honour's statement that Mrs. Hanlon conceded that it could sometimes be difficult to see the change in level. I say this since the only passage in the transcript to which we have been referred to support that latter statement is at Combined Blue/Black Appeal Book 52: "Q. You'd agree that when the light conditions are fading at the time when you may or may not put a light on to go out, that the differentiation of the two assuming there's nothing there is at times hard to see?. A. It could be." 28 But let one assume that her Honour was correct in her assertion that it was foreseeable that, in a situation such as the Appellant asserted was the case, there might be a risk of injury, the question which arises is whether or not anything more was required of Mrs. Hanlon than had already been done. 29 In this respect, her Honour said (RAB 28): "The difficulty arises in relation to the second part of the test. Firstly, in the absence of expert evidence it is difficult to assess whether the actions proposed by counsel for the Plaintiff would have prevented the fall. Would it be usual practice for an automatic light to turn on when a visitor was approaching rather than leaving the premises? How much time would elapse between the Plaintiff triggering a sensor and the light coming on? How far would the Plaintiff have walked in that time? Would paint on the edge of the step have been of any assistance when the whole area was gloomy? These questions cannot be answered on the evidence. Further alleviating action had been taken as there was a light installed above the landing which the Plaintiff did not turn or request the Second Defendant's son to turn on. In addition, I find that there was a very low magnitude of the risk occurring. The Plaintiff left the Second Defendant's premises without first informing the Second Defendant's son of her intention to leave. She proceeded onto the landing even though she was aware that the weather was overcast and dim. The Plaintiff did not put on the light even though the switch was next to the door. I accordingly find there was no breach of duty." 30 This passage might be criticised for, as her Honour rightly recorded in her statement of the issues, the question was not so much whether or not, if any of the steps that had been suggested had been taken, the accident would have been prevented, but whether, in all the circumstances of the case, any action was required of Mrs. Hanlon other than having installed a light which could be turned on when it was dark at night. 31 However, while one might criticise the manner in which her Honour expressed her reasoning, it seems to me that her Honour was correct in her conclusion, for, in reality, there was nothing further which needed reasonably to be done. 32 I would therefore propose that the Appeal be dismissed. 33 The question of costs was not dealt with by Balla A-DCJ in the formal Judgment which she delivered on 21 August 1998. At the time when her Honour delivered her Judgment there were present the Appellant's counsel and a solicitor representing the Body Corporate. The Appellant's counsel sought an order that each party pay her and its own costs of the proceedings, an order which, as between the Body Corporate and the Appellant, the solicitor representing the Body Corporate did not oppose. However, the solicitor representing the Body Corporate sought to have an order for costs of the third party proceedings made in favour of the Body Corporate against Mrs. Hanlon, as her Honour had earlier dismissed both the third party proceedings and the cross-action. Her Honour declined to adjourn all arguments on the question of costs until a later date, but reserved to the two defendants liberty to have the matter restored. 34 On 14 September 1998 when the matter came before the court again, counsel appearing for Mrs. Hanlon sought to have her Honour set aside the order that Mrs. Hanlon bear her own costs of the proceedings but her Honour declined to do so on the ground that she had made a final order on the previous occasion. 35 Counsel for the Body Corporate then sought, and her Honour made in favour of the Body Corporate, an order that Mrs. Hanlon pay the Body Corporate's costs of the third party proceedings. 36 While Mrs. Hanlon seeks to have her Honour's order insofar as it affects her as against the Appellant set aside, she does not seek to have set aside the order that she pay the costs of the Body Corporate of the third party proceedings. 37 It seems to me with respect that, in dealing as she did, and without expressing any reasons whatsoever for what she did, her Honour's action in ordering that all the parties bear their own costs was contrary to principle insofar as it affects Mrs. Hanlon. The fact of the matter is that, in the absence of special circumstances - and I can see none - the general rule is that in inter-partes litigation costs follow the event. There being no reasons given by her Honour for departing from that rule, it follows, in my view, that her discretion miscarried and that the cross-appeal should be allowed and that there be substituted an order that the Appellant/Cross-Respondent pay the costs of the Second Respondent/Cross-Appellant of the proceedings and of the cross-appeal. 38 The Body Corporate has, however, appeared today, although in the circumstances - there having been made clear in the Draft Amended Notice of Cross-Appeal that no relief was sought against the Body Corporate - its appearance today was in my view unjustified. However, Mrs. Hanlon had originally filed a Notice of Cross-Appeal as of right in which was sought an order that the Appellant pay the costs of both the Body Corporate and Mrs. Hanlon of the proceedings. When, in the course of preparation of the Cross-Appeal, the Transcript of what occurred before her Honour on both 21 August, and 14 September, 1998 was received, the Body Corporate was put on notice that Mrs. Hanlon would not seek to disturb the order for costs of the third party proceedings which had been made by her Honour on 14 September 1998. Meantime, however, the Body Corporate had entered an Appearance to the Appeal and purported Cross-Appeal and had filed a Notice of Contention. 39 It seems to me that, in the circumstances, the Body Corporate should have its costs against Mrs. Hanlon but only until 4 November 1999, at which time it was notified that Mrs. Hanlon would not seek to disturb the order in its favour. 40 In these circumstances, I would propose the following Orders: 1. ORDER that the Appeal be dismissed. 2. ORDER that the Appellant pay the costs of the Second Respondent of the Appeal. 3. MAKE NO ORDER as to the costs of the First Respondent of the Appeal. UPON the Second Respondent/Claimant undertaking to the Court to file a Notice of Cross-Appeal in terms of the Draft Amended Notice of Cross-Appeal 4. ORDER that leave to Cross-Appeal be granted. 5. ORDER that the Cross-Appeal be upheld. 6. ORDER that the Order made by Balla A-DCJ in the District Court insofar as it affects the Second Respondent/Cross-Appellant's costs be set aside. 7. ORDER that the Appellant/Cross-Respondent pay the costs of the Second Respondent/Cross-Appellant of the proceedings and of the Cross-Appeal. 8. ORDER that the Second Respondent/Cross-Appellant pay the costs of the First Respondent of the Cross-Appeal up to and including 4 November 1999. 41 PRIESTLEY JA: I agree generally with what has been said by Powell JA. In regard to the appeal, as I read the part of her Honour's reasons in which she explained why she thought the plaintiff failed, her opinion was that although a reasonable person in the second defendant's position would have realised there was a risk that a visitor to the premises in the late afternoon would fail to see the step and be injured, she also thought there was such a very low magnitude of that risk occurring that a reasonable person need do nothing further in response to that low risk than was already present in the situation at the steps at the time of the accident. 42 In my opinion, the material before the trial judge entitled her to reach those conclusions and the plaintiff should not succeed in the appeal. 43 HANDLEY JA: I agree substantially with the previous judgments and with the orders that have been proposed. ******** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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