Administrators, receivers, managers and liquidators: New obligations imposed on 'hoteliers' in relation to the care of patrons

Insolvency practitioners are sometimes required to manage licensed premises as part of an appointment. In such cases, potential liability for damages flowing from the conduct of intoxicated patrons could become an issue.  The recent decision of the Supreme Court of Tasmania in Scott v CAL No 14 Pty Ltd t/as Tandara Motor Inn and Another (No 2) [2009] TASSC 2 departed from the general rule that hoteliers do not owe a duty of care to prevent harm caused by a patron's intoxication.

Shane Scott, sometime after entering the Tandara Motor Inn, had his motorcycle placed in the bar storeroom by the licensee of the venue, Mr Kirkpatrick. It was agreed that Mr Scott's wife would pick him up from the bar when he was ready to leave.

Mr Kirkpatrick served Mr Scott seven to eight spirit mixers after which he refused to serve any further drinks to him. Mr Kirkpatrick offered to call Mr Scott's wife to pick him up but that offer was refused. Mr Scott demanded the keys to his motorcycle which Mr Kirkpatrick obliged in providing. Approximately 10 minutes later, Mr Scott was killed when he crashed his motorcycle off a bridge. The police estimate that at the time of the accident Mr Scott's blood alcohol concentration was 0.253%.

Mr Scott's wife and the Motor Accident Insurance Board brought an action against the owner of the Tandara Motor Inn and the licensee, Mr Kirkpatrick. It was alleged that they were negligent by allowing Mr Scott to leave the premises on the motorcycle while intoxicated and ultimately responsible for his death. At the first instance, it was held that the owner and the licensee of the bar owed no duty to prevent harm caused by Mr Scott’s own intoxication.  

However, on appeal it was held that 'the scope of the duty that arises from the relationship between a hotelier who provides alcohol and a patron may be extended by the particular circumstances of the case.'  It was concluded that 'by putting the motorcycle into a hotel storage room, and receiving its keys from Mr Scott, K (Mr Kirkpatrick) took on a role in relation to the means by which Mr Scott was to leave the hotel that night that went beyond the normal relationship between a hotelier selling alcohol and a patron.' It was determined that 'a reasonable person in the position of K (Mr Kirkpatrick) would have foreseen that if he failed to do something to deflect Mr Scott from riding the motorcycle from the hotel, there was a risk that Mr Scott would suffer serious injury.'

The Court found Mr Kirkpatrick’s conduct in assuming responsibility for the motorcycle and being told of Mr Scott's alternate plans to get home that evening went 'way beyond the normal relationship between a hotelier selling alcohol and a patron.'  It was found that Mr Kirkpatrick in order to discharge his responsibility, should have at least phoned Mr Scott's wife (as he had done in the past) and asked her to come and get her husband. It was held that a reasonable person in Mr Kirkpatrick's position would not have given Mr Scott the keys to the motorcycle.

This case serves as a timely warning to all owners and licensees of venues that serve alcohol. The duty of care they owe towards a patron can be heightened depending on their own conduct and the amount of interaction with the patron. The case demonstrates that if owners, or licensees, involve themselves in a patron's decision regarding their passage home, they will have a duty to ensure the patron uses a safe mode of travel when leaving the venue.

Need more information or have any queries?  Please contact Tim Coyle on (08) 9288 6761 or Darren Zusman on (08) 9288 6734.

Disclaimer – the information contained in this publication does not constitute legal advice and should not be relied upon as such. You should seek legal advice in relation to any particular matter you may have before relying or acting on this information. The Lavan team are here to assist.