In the recent decision, Woolworths Ltd and Ryder,1 the NSW Court of Appeal (the Court) considered whether Woolworths Ltd (Woolworths) owed a duty of care to users of a common area near the entrance of its premises in circumstances where the hazard was created by use of a product purchased from Woolworths. The Court found in favour of Woolworths and held that a duty of care was not owed by Woolworths in those circumstances.

This is an interesting and particularly relevant case for owners or occupiers of retail premises. We examine below the factors that are relevant in determining whether a duty of care should be imposed.

Facts of the Case

Ms Ryder slipped and fell on a soapy residue while walking in the common area of a shopping centre, adjacent to a supermarket operated by Woolworths. The residue was made by a child blowing bubbles from a bottle of soapy liquid sold by Woolworths to her parents. There was tenuous evidence that a Woolworths' employee had opened the bottle of soapy liquid either at the request of the child or her parents. Ms Ryder sued Woolworths for damages suffered from her fall.

Initial Decision

At trial in the District Court of NSW, the primary Judge found that Woolworths owed a duty of care to Ms Ryder to take reasonable care to prevent a danger being created by reason of the use of products purchased at the supermarket. His Honour also found that Woolworths breached its duty of care by failing to warn the parents against allowing the child to use the soapy liquid to blow bubbles in the common area. The primary Judge's decision also relied on evidence that a Woolworths' employee had opened the bottle of soapy liquid for the child. According to the Primary Judge, this constituted a breach of the duty of care by Woolworths to Ms Ryder.

Decision on Appeal in the NSW Court of Appeal

Woolworths challenged the primary Judge’s finding on three grounds:

  1. The admission that the bottle had been opened by a Woolworths' employee was not supported by evidence;
  2. The duty of care formulated by the primary Judge had no basis in principle or policy; and
  3. If a duty of care existed, the primary Judge erred in finding that Woolworths breached its duty.

The leading judgment in the appeal was delivered by Justice Sackville, whose judgement was agreed with by Justices Ward and Basten.

The Admission

In respect of the first issue, the Court held that there was an absence of affirmative evidence that a Woolworths' employee made the admission that it was Woolworths' staff that had opened the bottle of soapy liquid. First, Ms Ryder was mistaken as to the identity of the female employee who purportedly made the admission. Secondly, this alleged admission was made in a conversation that took place between two Woolworths' employees where one of the employees had no recollection of the same conversation.

Duty of Care

The duty of care formulated by the primary Judge appeared to impose an obligation on Woolworths, as the occupier and operator of the supermarket, to exercise reasonable care to relieve any foreseeable danger of which it is or should be aware, regardless of whether the danger might exist within the supermarket itself or in a nearby common area. The duty was said to be owed even to a person who was not in the supermarket. Nor was the duty, as formulated by the primary Judge, confined to dangers arising from activities conducted in the supermarket or goods sold by the supermarket. It applied in relation to the act of a third person who Woolworths had no control over. Both Justices Sackville and Basten found difficulty in imposing a duty of care of this breadth.

Ultimately, the Court found that Woolworths did not owe a duty of care to Ms Ryder on the following basis:

  1. The fact that the risk of harm suffered by Ms Ryder was foreseeable was not sufficient to impose a duty on Woolworths to take reasonable care to prevent the harm occurring;
  2. The duty of care is associated with the question of whether it is reasonable to require a person to have in contemplation the risk of injury that has eventuated. If it were otherwise, the law would impose an intolerable burden;
  3. In novel situations or circumstances, there is no single touchstone or test which determines whether a duty of care should be imposed. It will need to be examined in consideration of a non-exhaustive list of salient features;
  4. Woolworths did not occupy the common area. It did not operate a business in that area. Further, it had no exclusive control over the area; and
  5. The act which was the immediate cause of the hazard to which Ms Ryder succumbed was not the act of any member of Woolworths' staff, it was the careless act of a child. The child was at all relevant times in the care and control of her parents, not Woolworths.

The Court considered that a duty of the kind suggested by the primary Judge would impose an intolerable burden of potential liability on Woolworths. It would also impose extraordinarily onerous burdens on owners and occupiers of retail premises that go beyond reasonable concern for the interest of others.

Breach of Duty

In the event that a duty of care was owed by Woolworths to Ms Ryder, Justice Sackville considered there to be no breach. The Civil Liability Act 2002 (NSW) required a consideration of whether a reasonable person in the position of Woolworths would have taken the precaution identified in the primary Judge's finding, having regard to the matters set out in section 5B(2). In determining what precautions should have been taken by Woolworths, Justice Sackville took into account that the child was in the care of her parents at all material times. Further, there was no evidence as to the circumstances in which the checkout operator came to open the bottle or the communications which passed between the operator and the parents of the child. As such, Justice Sackville concluded that a breach of duty was not in any event established.

Conclusion

This case shows that in novel situations or circumstances, the Court will take a cautious approach in determining whether a duty of care should be imposed. For owners and occupiers of retail premises, this case confirms that they have limited liability for how their products are used by customers in common areas nearby. It is of benefit to owners and occupiers of retail premises that the Court has taken a narrow (and arguable a sensible) approach to determining the duty of care. The Court will however always look at all aspects of the factual circumstances to determine whether a duty of care exists, including the degree and nature of control able to be exercised by the defendant to prevent harm, the nature or degree of the hazard or danger liable to be caused by the defendant's conduct, any potential indeterminacy of liability, and the nature and consequence of any action that can be taken to avoid the harm to the plaintiff.

Ultimately, the issue of whether a duty of care is owed and whether there has been a breach of that duty is a complex area of law which depends on the facts of the case.