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Touchline • Issue 16 • 35
SUMMARY
The court held that section 74(1) of the Trade Practices Act
1974 (Cth) (the TPA) had the effect of deeming an implied
term of contract between the parties that the defendant
would provide services with due care and skill to the plaintiff.
The defendant purported to exclude liability of the implied
terms and its liability generally under the CLA and to rely
upon a written exclusion of liability clause on the reverse side
of the plaintiff’s lift ticket and the operation of section 5N
(1) of the CLA which allows parties to a contract to exclude
liability for dangerous recreational activities.
Section 68 of the TPA provides that any term of a contract
that purports to exclude, restrict or modify or has the effect of
excluding, restricting or modifying the section 74(1) implied
due care and skill warranty is void.
The defendant sought to avoid the operation of section 68(1)
by relying on either or both of the exceptions contained
in sections 68A and 68B of the TPA which allow limitation
of liability to the cost of the supply of the service. Section
68A provides the exception in relation to the supply by a
corporation of services other than those of a kind ordinarily
acquired for personal, domestic or household use or
consumption while section 68B relates to the supply by a
corporation of recreational services.
The Court of Appeal held that neither of the above applied.
The contract was not for services for “personal, domestic or
household use or consumption”. In relation to section 68B, the
court concluded that the contract was not one for the supply
of “recreational services” because the contract was merely a
contract to provide transport services on a ski slope and did
not concern participation in a sporting activity.
The Court held that the ski resort was negligent and in
breach of the condition implied by section 74(1) of the TPA,
by reason of the lift operator’s inattentiveness and failure to
take precautions. The Court held that the lift operator was
not adequately positioned to identify, and if required, ensure
that the safety bar could be lifted in a timely manner. The
identified risk of harm was foreseeable and not insignificant.
The court concluded that the incident would likely not
have arisen if the lift operator had intervened in the correct
manner.
The court accepted evidence that the plaintiff was out of
alignment with the chairlift at the designated loading point
when she was hit by the chair. Despite this, the plaintiff had
not contributed to her own injuries and that instead her
misalignment was a consequence of the late intervention
by the chair lift operator in rectifying the safety bar issue.
Accordingly, the court rejected the ski resort’s allegations of
contributory negligence.
The court rejected the defendant’s inherent risk argument
raised under section 5I of the CLA on the basis that the risk
could have been avoided by the exercise of reasonable care
and skill on the part of the lift operator. The ski resort also
contended that the harm suffered by the plaintiff was a result
of a dangerous recreational activity pursuant to section 5L of
the CLA. The Court rejected this argument and held that the
relevant activity (for the purpose of the statutory defence) was
the process of boarding a triple chair lift in the presence of
lift operator and this did not constitute a dangerous activity.
The Court held that the defendant could not rely upon
the warning on the reverse of the ticket or the “Alpine
Responsibility Code” signage displayed at the resort to avoid
liability. The warnings were not considered adequate under
section 5M because:
1.
The mere printing of the warning in small font was
not sufficient to bring the warning to the attention
of people; and
2.
The warning did not warn of the specific risk in
relation to the chairlift.
This case highlights the significant difference between a
recreational activity which may be dangerous (such as skiing)
and potentially offer the ‘dangerous recreational activity’
defences as opposed to ancillary activities (such as using a
chairlift) which should be relatively innocuous if operated
carefully.
The case also provides guidance to operators in relation to
the adequacy of warnings. To be effective a warning must be
communicated. This is unlikely to be achieved by a fine print
warning on the reverse of a lift ticket if it lacks specificity and
is not brought to the attention of patrons.
William Thompson is a Solicitor at DLA Piper
James McIntyre is Special Counsel at DLA Piper
T
+61 7 3246 4138
E
james.mcintyre@dlapiper.com
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