Posted on April 2, 2015 by

Council’s Obligations to Contractors

The NSW Court of Appeal has recently delivered judgement in the case of Central Darling Shire Council v Greeney [2015] NSWCA 51 which confirms the duty of care a council owes to its contractors.

The principal issue in the appeal was whether the Council had an obligation to eliminate or  minimise the foreseeable risk of injury to a contractor carrying out transportation tasks in connection with road repair and maintenance works.

The facts of the case are summarised as follows:

  • The Council had a system for repairing and maintaining roads in remote outback areas which involved a contractor moving vehicles in a road train to enable workers to set up camp between work sites;
  • Over a period of 12 months, the Council employee who supervised this system received repeated complaints from the contractor in relation to defective transportation equipment; and
  • The contractor suffered significant injury to his back when directed by the Council employee to move the vehicles in a road train.

Duty of Care

The Court found that the Council was under an obligation to use reasonable care to avoid and or minimise unnecessary risks of injury to the contractor.

This obligation stemmed from the position of overall control the Council had in organising a system of road repairs and maintenance.

Several factors were found by the Court to demonstrate that the Council owed a duty of care to the contractor:

  • The Council employee, acting on behalf of the Council, exercised control over the contractor in directing the movement of the vehicles;
  • Relevantly, this control was exercised in a context where the Council employee’s knowledge of the tanker’s defective coupling structure brought with it a foreseeable risk of injury to the contractor;
  • Alternatively, the contractor was in a position of vulnerability as “he had no choice but to obey” the direction. As such, the contractor was reliant upon the Council exercising reasonable care in setting up safe work conditions;
  • Council enjoyed a direct financial advantage from the transport arrangement adopted; less time and costs were involved in moving all the vehicles at once. A simple, yet more costly, precaution would have been to contract additional workers to assist the sole contractor; and
  • As a matter of common sense, the contract between the Council and the contractor implied a term that Council was required to provide vehicles that were fit for use.

This case is a useful reminder of how councils can become exposed to liability once they assume a position of control over a system of public works.

Whilst the Courts have recognised that the duty of care owed by a council to a contractor is not as stringent as that owed to an employee, councils are nonetheless under obligations to take precautions against serious harm to those that they contract to do public works.