Background

Charles Dearden (the plaintiff) (‘Charles’) was invited to the 21st birthday party of his friend, Daniel Ryan (‘Daniel’). The party was to be held at Daniel’s family’s property (‘the property’), which was owned by Terence Ryan (‘Terrence’) and Nicole Ryan (‘Nicole’) (who were the defendants).

On the property was a house, as well as adjacent sheds and water tanks. The sheds on the property were namely utilised for storing gardening equipment and motor vehicles. Terence and Nicole grew grain on the property but stored the majority of the agricultural plant and equipment along with the entire fuel store in work sheds on an adjacent property (‘the adjacent property’). The adjacent property was a short drive from the property, and unleaded petrol was stored there in jerry cans at a “fuel hub”.

The birthday party was arranged by Nicole, who invited 40-50 mature guests, and over a hundred younger guests. Food and alcohol were provided at the party, as was a location for guests to stay the night in the event they drank too much alcohol. There was also access to a breathalyser for those wishing to drive home that night or in the morning.

The events of the night unfolded as follows:

• At dusk the electricity supply failed.
• Terence obtained a generator and three jerry cans (two large cans, and one small) of fuel from the adjacent property to supply electricity until an electrician could arrive.
• Terence had one of the guests pour fuel from the small can into the generator, who filled the generator then informed Terence that the can was empty, then placed it in the back of a utility.
• An electrician arrived approximately an hour and a half later and restored the power.
• A few hours later, a grassfire was started by guests using fuel from the small jerry can.
• After the fire was extinguished, Matthew Ryan (‘Matthew’) (Terence’s adult son) picked the small can up, and Terence told Matthew to “put it in the shed”.
• Sometime after midnight, Charles walked from the party over to a swag and went to sleep.
• Noting Charles’ absence, his friends went looking for him. Amongst them, was Robert Taylor (‘Robert’).
• Whilst searching for Charles, Robert deviated into a shed to obtain some fuel. In an intoxicated state, he decided to wake Charles up by lighting his swag on fire.
• Robert explained at the trial that he had an expectation that there would be fuel in the shed, having himself grown up on a farm.
• Robert found the fuel in the small jerry can in the shed, which had been stored inside a terracotta pot, approximately one metre inside the shed.
• Robert was handed a lighter, then dribbled fuel onto Charles – causing his clothes to ignite instantly.
• As a result, Charles sustained serious injuries, including severe burns.

Decision at First Instance

It was not in dispute that Terence and Nicole, as occupiers, owed to Charles a duty of care to take reasonable steps to minimise the foreseeable risk of harm.

Crow J found that the provision of the source of fuel, being the small jerry can, then placing it in a position that made it available to social guests who were expected to be highly intoxicated, combined with the fact that there had been an earlier grassfire, placed upon the defendants a duty to take reasonable care to prevent harm from an uncontrolled fire lit by an intoxicated guest from petrol made available by the defendants.

The defendants’ duty was not found to arise from the defendants’ position as social hosts, but rather as occupiers under the general duty as outlined in in Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479.

The conclusion Crow J reached was that a reasonable person in the position of the defendant would have taken the precaution of safely securing the fuel considering:

• The low burden in taking precautions.
• The likely seriousness of the harm to be suffered from a fire.

Crow J considered these factors outweighed the low probability that harm would occur and the high social utility of conducting the 21st birthday party.

Appeal to the Queensland Court of Appeal

The general rule in Smith v Leurs [1945] HCA 27 was considered: ‘one man is under no duty of controlling another man to prevent his doing damage to a third’.

As were the exceptions to the general rule, namely:

• ‘Special relations’ which can be the source of such a duty.
• The element of control an occupier has over a third party.
• Where the act of the third person could not have taken place but for the occupier’s own fault or breach of duty. There is more than one description of duty the breach of which this may produce this consequence. For instance, it may be a duty of care in reference to things involving special danger.

After canvassing the judgment, McMurdo JA (who gave the leading judgement) noted that it cannot be said that a capacity to control their guests was the basis of liability in the first instance.

McMurdo JA noted that a duty in reference to things involving special danger was the principal way in which Crow J saw an exception to the general rule that there is no duty to prevent a third party from harming another. 

In coming to its decision to set aside the original judgment, the Court of Appeal reviewed the ‘special danger’ exception. In particular, the matter of Smith v Littlewoods Organisation Ltd [1987] AC 241:

“But there is a more general circumstance in which a defender may be held liable in negligence to the pursuer, although the immediate cause of the damage suffered by the pursuer is the deliberate wrongdoing of another. This may occur where the defender negligently causes or permits to be created a source of danger, and it is reasonably foreseeable that third parties may interfere with it and, sparking off the danger, thereby cause damage to persons in the position of the pursuer. The classic example of such a case is, perhaps, Haynes v. Harwood [1935] 1 K.B. 146, where the defendant's carter left a horse-drawn van unattended in a crowded street, and the horses bolted when a boy threw a stone at them. A police officer who suffered injury in stopping the horses before they injured a woman and children was held to be entitled to recover damages from the defendant. There, of course, the defendant's servant had created a source of danger by leaving his horses unattended in a busy street. Many different things might have caused them to bolt - a sudden noise or movement, for example, or, as happened, the deliberate action of a mischievous boy. But all such events were examples of the very sort of thing which the defendant's servant ought reasonably to have foreseen and to have guarded against by taking appropriate precautions.

Moreover, it is not to be forgotten that, in ordinary households in this country, there are nowadays many things which might be described as possible sources of fire if interfered with by third parties, ranging from matches and firelighters to electric irons and gas cookers and even oil-fired central heating systems. These are commonplaces of modern life; and it would be quite wrong if householders were to be held liable in negligence for acting in a socially acceptable manner. No doubt the question whether liability should be imposed on defenders in a case where a source of danger on his land has been sparked off by the deliberate wrongdoing of a third party is a question to be decided on the facts of each case, and it would, I think, be wrong for your Lordships’ House to anticipate the manner in which the law may develop: but I cannot help thinking that cases where liability will be so imposed are likely to be very rare.

… there is at present no general duty at common law to prevent persons from harming others by their deliberate wrongdoing, however foreseeable such harm may be if the defender does not take steps to prevent it.”

McMurdo JA ultimately considered:

• The foreseeability of a risk of a fire such as this one was not the determinant of whether the general rule had been displaced. And however foreseeable it may have been that someone would again use the fuel to start a fire like that which was started on the lawn, it was another thing to say that a risk of the deliberate ignition of the clothing of a guest as he slept was reasonably foreseeable, such that the appellants owed a duty to take precautions against it.
• As to the suggested creation of a source of danger by leaving the fuel in the shed, it was stated that outside cases of a special relationship, in a case in which a defendant is rendered liable for facilitating a third-party harming another, the defendant’s liability is for more than mere inaction. Therein was Crow J’s critical error – there are many things which might be described as possible sources of fire if interfered with by third parties which are commonplace in ordinary households. This may be said of small quantities of petrol which are commonly kept, not only in sheds on farms, but in suburban sheds and garages. As Gleeson CJ said in Modbury, the general rule is founded upon considerations of practicality and fairness. If occupiers were under a legal duty to take steps to prevent harm being caused to another by a third party from the misuse of things kept in an ordinary way on their properties, the burden would be intolerable.

In summary, the Court of Appeal determined that the general rule was not displaced in this case. Terrence and Nicole were not liable, because they were not obliged to take such steps as were necessary to prevent Taylor from harming any other guest by deliberately setting fire to that guest’s clothing.

Implications

The Court of Appeal has provided a helpful and considered analysis of the existing caselaw in this area, setting aside a judgement which on its face extended the scope of duty beyond what many had anticipated. It also serves as a reminder that whilst the duty of an occupier can be wide, it does have limits.

Further information / assistance regarding the issues raised in this article is available from the author, Scott Cowell, Partner, Joshua Watkins, Associate or your usual contact at Moray & Agnew.