Upcoming Mallesons seminarsOn 5 May 2000, the Queensland Court of Appeal ordered that Johns v Cosgrove be retried. The 1997 Supreme Court of Queensland decision in Johns v Cosgrove 1 , has been regarded by commentators as ‘the high-water mark of the development of Australia’s alcohol server liability’.
The irony recently revealed is that the decision formulating the principles of liability was based on false facts. Despite the order that the case be retried, there seems little doubt that the ambit of the duty of care owed by a publican to patrons is steadily expanding. The hospitality industry and its insurers will have to respond to this judicial trend, with stronger risk management schemes to ensure staff are adequately trained to meet the standard of care courts are demanding.
The facts before the Supreme Court of Queensland
Johns suffered injuries when he was struck by a motor vehicle driven by Cosgrove in April 1990. Johns was grossly intoxicated with a blood alcohol level of .332%, measured shortly after the accident. Johns was struck when he apparently stumbled out onto the road at night, whilst waiting at a Surfers Paradise bus stop.
The evidence before the court was that Johns had gone to the Chevron Hotel at 4.30 pm on the day of the accident and drank heavily there until closing time. The Hotel was situated between two major arterial roads and it was known to at least some of the staff that it was Johns’ (who was a regular at that hotel) usual practice to catch a bus home, unescorted.
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Johns sued Cosgrove (first defendant) and Chevron Hotel (second defendant), for damages for personal injuries. The court apportioned liability between the parties – Johns 45%, Cosgrove 30% and Chevron Hotel 25%. On the material facts before the court, Mr Justice Derrington held
‘It is not negligence merely to serve a person with liquor to the point of intoxication; but it is so if because of the circumstances it is reasonable (sic), foreseeable that to do so would cause danger to the intoxicated party, such as, for example where the intoxication is so gross as to cause incapacity for reasonable self-preservation when it is or should be known that he or she may move into dangerous circumstances, and where no action is taken to avert this…The danger would be enlarged if it were known that the intoxicated person would be negotiating dangerous traffic such as would be found where the hotel was situated between two major arterial roads, and his habit of going home unescorted was known’
Queensland Court of Appeal
The Court of Appeal found that much of the plaintiff’s evidence (as to his being in the Hotel and his becoming hopelessly drunk at that venue, before the accident) was fraudulent
The Court found that the plaintiff had paid witnesses to give false evidence. The Court ordered that the Supreme Court judgment be set aside and directed that a new trial be held. Critically however, the Court of Appeal did not challenge the Supreme Court’s decision on the ambit of the publican’s duty.
3 Johns v. Cosgrove, op-cit, at 114 per Derrington J
4 Cosgrove v Johns unreported decision of Supreme Court of Queensland Court of Appeal, No. 453 of 1998, Dejersey CJ McMurdo J and Thomas JA, 5 May 2000 at paragraph 78 per Thomas JA
Accordingly, the principles laid down by Mr Justice Derrington, regarding an alcohol server’s liability for damage suffered inside and outside the premises, as a result of the continued service of alcohol to an intoxicated patron, remain good law in Queensland. The 1997 Cosgrove decision is also ‘…consistent with the dramatic expansion of alcohol-related liability litigation in North America’.
Application for special leave to appeal to the High Court
On 1 June 2000, Johns filed an application for special leave to appeal the Queensland Court of Appeal’s decision, to the High Court. Meanwhile, the retrial is on hold, pending the outcome of the special leave application.
Conclusion
The 1997 Cosgrove decision places a heavy onus on alcohol servers in Queensland. Furthermore there must also be compliance with their obligations under the Liquor Act 1992 (Qld). Under this Act, it is an offence to supply liquor to, or allow liquor to be consumed by, an unduly intoxicated or disorderly patron.
A further sobering thought for licensees is that if they are sued in relation to the service of alcohol, a claim for indemnity may be denied if their insurance policy excludes cover where the insured is in breach of its relevant statutory obligations