IN THE FULL COURT OF THE SUPREME COURT OF VICTORIA
BETWEEN:
No. 1 of 2015
THE MELBOURNE GRAND HOTEL
Appellant
-and-
I. AGREED FACTS
MS ANJA SCHMIDT
Respondent
1. The plaintiff, Anja Schmidt, is a German national who was born in 1990. She is an amateur
athlete who competes in the short distance sprint at athletics events. While Anja occasionally
travels internationally to compete in international events, she has spent the majority of her
life living and training in Germany and has only a basic understanding of English.
2. After recently being awarded a moderate sum of money as a prize for placing second in a
district 100m sprint competition, Anja decided she should spend her off-training period
holidaying overseas. In January 2014, she booked flights to travel to Melbourne Australia,
where she decided to stay in Melbourne Grand Hotel for a week.
3. The Melbourne Grand Hotel is a new luxury resort complex opened in 2013 and located 2km
from the Melbourne CBD in the suburb of Northfield 1. The Grand Hotel markets itself as a
luxury hotel, and its clients typically consist of upmarket tourists who are visiting
Melbourne. The Hotel’s peak business period runs from early December to late January
where there is a large influx of tourists visiting Melbourne during the Christmas and New
Year period. In the 2013/4 period, however, business was lower than expected due to a
number of violent incidents in the CBD that were heavily publicized on local and
international media. As a result of this downturn in business, Anja was able to secure a
booking with the hotel at a significantly discounted rate.
4. The Grand Hotel also features one of the largest restaurant and ballrooms in the Southern
hemisphere, The Grand Ballad. The ballroom is marketed as one of the key attractions of the
Melbourne Grand Hotel and is described in marketing and promotional materials as a ‘no
expenses spared experience’. While the ballroom is usually restricted for functions and prebook events, occasional the hotel runs themed costume nights for its guests.
5. After checking in to the Grand Hotel on the 14th of January 2014, Anja discovered that, having
packed only casual attire, she was treated with a decidedly ‘cool’ attitude by the hotel staff,
who were more used to dealing with up-market clientele. As a result Anja mostly kept to
herself, and spent most of her first few days exploring the Melbourne CBD or jogging around
the parkland’s running track.
6. On the 16th of January, Anja discovered a flyer in the hotel lobby, advertising the hotel’s latest
event, a costume party with a ‘backpacker’ theme being held at The Grand Ballad. Anja was
excited about the event, as this would give her a chance to see the famous ballroom. She
quickly registered her interest in attending and was fortunate to be offered one of the final
places for the event.
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A fictional suburb.
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7. Unbeknownst to Anja, in December 2013, a severe heatwave caused some of the main water
pipes to burst underneath the Melbourne Grand Hotel. While attempting to fix the problem,
workmen from the Victorian State Water Authority caused some damage to the hotel
foundations. The damage was relatively minor, but a section of the hallway leading from the
hotel lobby to the Grand Ballad had collapsed. The engineer’s report on the hallway
concluded that the floor of the hallway section was not stable and, even though it looked
even, some of the tiles could collapse or shift when walked on. However, no repair was
possible until the end of the heatwave season in March.
8. The hotel created a detour pathway that lead to the side door of the Grand Ballad Restaurant.
The main door of the restaurant was closed and locked, however, as a single switch
controlled lighting in the whole lobby area, hotel management was unable to turn off the
lights in the hallway connecting the lobby to the Grand Ballad ballroom without also turning
the lights off elsewhere in the lobby and as a result the hallway was left illuminated. To
prevent guests passing down the hallway, hotel management erected two large A2 sized
colour signs that were placed at either side of the hallway entrance. They had considered
also placing high visibility tape across the hallway entrance, but decided against doing this as
they believed it would affect the aesthetic of the lobby area and damage their image as a
‘luxury’ destination. While the Hotel hires its own security personnel, they were recently restationed outside the hotel lobby in response to the increased media attention regarding
violence in the Melbourne CBD area and were therefore unable to assist in guiding guests to
the detour pathway.
9. Having looked at the hotel map, Anja dressed up in her usual backpacking clothes and went
to the party on the 17th of January at 9pm. At this time, the lobby area was empty except for
the hotel receptionist who was stationed near the entrance to the lobby. Anja noticed the two
signs adjacent to the ballroom hallway but due to her poor knowledge of English she could
not read the warning messages. Seeing that the hallway lights were still on, she decided to
walk down the hallway and tripped on an unstable tile. Anja was rushed to the Royal
Melbourne Hospital and was diagnosed with a broken leg. Her right leg was put into plaster
and she was advised that it would be 8 weeks before she could travel again. To give herself
time to recover, Anja moved to a budget motel in the Melbourne CBD.
10. Six weeks later, Anja was able to put weight on the plaster so she decided to go out for a walk
one night. While she was out she was confronted by a gang of youths. Unable to escape due to
her reduced mobility, Anja was mugged and had her wallet and phone stolen, although
fortunately she was left physically unscathed. As it turns out, the location of the mugging was
only a block away from the closest police station, however, Anja was unaware of this due to
her unfamiliarity with the city.
11. As a result of the mugging incident, Anja developed a rare psychiatric condition known as
agoraphobia. As a result of this condition, Anja suffers crippling anxiety attacks whenever
she is outside and alone at night. It is estimated that less then 0.1% of the Australian
population suffers from this condition and there is currently no known cure.
12. On the advice of her lawyer, Anja filed a Statement of Claim in the Supreme Court seeking
damages (i.e. monetary compensation) from the Melbourne Grand Hotel for her medical
expenses associated with her broken leg, as well as damages from the Hotel for her
psychiatric condition.
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II. FINDINGS AT FIRST INSTANCE
13. At the first instance hearing in the Supreme Court, Justice Ince found the Melbourne Grand
Hotel liable in negligence for failing to meet its requisite standard of care resulting in Anja’s
physical injuries. Justice Ince also found that, on the balance of probabilities, ‘but for’ Anja’s
physical injuries and her consequent reduced mobility, Anja would have been able to out run
her assailants and would therefore not have suffered her psychiatric injury. His Honour held
that the Melbourne Grand Hotel should therefore be held liable for causing Anja’s addition
psychiatric condition. Consequently, Justice Ince ordered Melbourne Grand Hotel to
compensate Anja for her physical and psychiatric injuries.
III. APPEAL GROUNDS
14. The Melbourne Grand Hotel appeals to the Full Court of the Supreme Court of Victoria on the
grounds that:
a) In relation to Anja’s physical injuries:
i. The Hotel had not breached its relevant standard of care as determined
under s 48(1)(c) of the Wrongs Act 1958.
ii. In the alternative, if the Hotel had breached its standard of care, the
amount of damages it pays to Anja should be reduced as Anja was
contributorily negligent in failing to take reasonable care for her own
safety.
b) In relation to Anja’s psychiatric injuries:
i. Even if the Hotel did breach its standard of care, it did not cause Anja’s
psychiatric injuries.
ii. Furthermore, Anja’s particular psychiatric condition was too remote (i.e.
unforeseeable).
Senior counsel is advised to address the appeal grounds in point (a). Junior counsel is advised to
address the appeal grounds in point (b).
You should assume that the Melbourne Grand Hotel has conceded that it owed a duty of care to
Anja Schmidt at all relevant times in the hypothetical. You do not need to discuss the specific
quantum of compensation sought in your submissions.
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Appendix 1 – Schematic of Grand Melbourne Hotel Lobby Layout
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Appendix 2 – Schematic of Warning Sign Displayed in Hotel Lobby
For the purposes of the hypothetical, assume there were two identical copies of this poster
printed in full colour and in A2 size. Assume each poster was laminated and affixed to the walls
adjacent to the Ballroom hallway entrance.
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