Review of the Carriers and Innkeepers Act 1958

Chapter 8 – Review of Legislation in Other States

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OVERVIEW

8.1 As was discussed in the preceding Chapter, most of the States and Territories of Australia have legislation similar to the Victorian Act. Governments in two States have taken the view that the legislation is archaic and in need of review. In New South Wales and the Australian Capital Territory, preliminary reviews have been carried out and discussion papers published in relation to the relevant legislation.

NEW SOUTH WALES

Problems identified

8.2 In 1990 the Chief Secretary’s Department of New South Wales issued a discussion paper entitled Review of the Innkeepers Act 1968. The paper identified the following "significant" problems with the legislation:

1.	The … Act is archaic, outmoded and largely irrelevant to the needs of the accommodation industry and the travelling public in the 1990’s ….
2.	…[T]he Act does not define "inn" so it is impossible for the industry and the travelling public to know which accommodation establishments are covered by the Act.
3.	The Act continues to use outmoded terminology - inn, common inn, innkeeper - without reference to modern language or facilities.
4.	Since the legislation was framed at the beginning of the century, a wide range of accommodation establishments has developed …. hotels, motels, motor inns …. [The Act] is totally inadequate because it ignores the existence of this range of establishments, and therefore does not address the extent to which the operators of these other establishments should be liable for the personal property of their guests.
5.	The provisions of the Act do not appear to be well known in the accommodation industry, the insurance industry or by the travelling public.
6.	The Act makes innkeepers fully liable for the goods of their guests if the goods are deposited for safe-keeping (or if the innkeeper refuses to accept the goods for safekeeping), even if the innkeeper is not negligent or at fault ….[316]
7.	The Act places this unlimited liability on innkeepers without regard to the size or facilities of the inn or to the nature of the goods….
8.	The unlimited liability provisions mean that NSW innkeepers cannot purchase insurance cover to cover the full extent of their liability under the law.
9.	[New South Wales] inns could be seen to be disadvantaged in this respect compared to Victorian inns where legislation provides a $2000 limit on liability (except for negligence of the innkeeper) [where the goods are deposited for safe-keeping]….
10 .	The Act requires innkeepers to be fully liable for goods that they have not seen or do not know exist, and for goods that the traveller may have privately insured.
11.	The Act excludes motor vehicles and contents from the liability of innkeepers on the basis that it is common for owners of motor vehicles to insure their vehicles against loss. It could be argued that the availability of travel insurance for personal property is justification for limiting the absolute liability of innkeepers for goods received or offered for safekeeping.
12.	To obtain the protection of the Act, innkeepers must display a notice (outlining the innkeeper’s liability) in the reception area and guest’s room. The review concluded that these signs are not extensively used throughout the industry. Establishments not displaying the notice therefore place themselves in a difficult legal position should a claim arise.
13.	The notices have the advantage of providing some (limited) information to the public. However, the signs should be in simple language and in community languages to the appropriate clientele of the facility.[317]

8.3 The discussion paper concluded that the problems with the NSW legislation also applied generally to other States. However, the paper stated, inquiries made to other states indicated "a general lack of interest and concern, and no moves to change the legislation".[318]

8.4 The Committee considers that most of the problems identified above also exist in relation to the Victorian legislation. However, the Victorian Act does include a definition of "inn", unlike the NSW Act which relies entirely on the common law definition. Also, of course, the Victorian Act does not currently impose unlimited liability on innkeepers for property deposited for safekeeping.

Recommendations

8.5 The paper recommended that the NSW Act be repealed and replaced by a new Act, to be developed according to the following principles:

1.	The purpose of the new Act should be to establish the extent of liability of accommodation establishments in NSW for the personal property of the travelling public so that the interests of the travelling public and the accommodation industry are best served and appropriately balanced.
2.	The Act should operate to limit the application of the common law liability of hotels, motels and other accommodation establishments in New South Wales.
3.	The Act should have a modern title to reflect its main purpose and application, for example, the Accommodation Establishments Liability Act 1990. It should use modern terminology and simple language.
4.	Accommodation establishments which should be picked up by the legislation are those establishments (whether licensed or unlicensed), acting on a regular for profit business basis, which operate primarily to provide temporary accommodation to the travelling public. Under this definition, hotels and motels would obviously be included. Guesthouses, hostels, lodges and private hotels would be excluded unless their primary purpose was providing temporary accommodation to travellers.
5.	Exclusions to the Act should be made for specific facilities, for example: - accommodation provided on a vehicle or craft - accommodation provided in a caravan - establishments which are set up for non-profit purposes - establishments whose primary function is not the provision of accommodation - accommodation which by its nature cannot be reasonably or adequately secured.
6.	Establishments providing accommodation for use by the travelling public on a regular business basis and for profit have a duty of care to provide appropriately secure facilities for travellers and their personal property.
7.	These establishments have an obligation to provide security that is appropriate to the standard of the facility and the tariff charged to the traveller.
8.	They should have a general and unlimited liability for personal property of their guests where this property is lost, damaged or stolen as a result of the fault, neglect or wilful act of the manager/operator of the facility or of his or her staff.
9.	As part of the duty of care, and in return for the tariff paid by the traveller, the manager/operator of the facility should have some liability for the property of guests, even where the loss/damage/theft does not result from the manager/operators neglect or wilful act. This liability however should be limited according to the following principles.
10.	The manager/operator and his/her staff should have no liability for loss, damage, theft of vehicles, property left in or on vehicles ….
11.	The operator should not be liable when the loss or damage was caused by an event which the operator exercising the care which the circumstances called for, could not have avoided and the consequences of which he/she could not have prevented.
12.	The operator should have a general duty to provide facilities for safe custody and to receive securities, valuable articles and money offered for safe custody.
13.	The operator should have the option to reasonably refuse property for safekeeping if the property offered is: - dangerous or illegal - cumbersome or bulky in terms of size or weight - of excessive value having regard to the size or standing of the establishment
14.	Where the operator is not bound to receive goods for safekeeping due to the goods being dangerous, cumbersome, or of excessive value (having regard to the size and standing of the establishment), he/she should not be liable for these goods if they are stolen, damaged or lost (unless the operator is negligent or at fault).
15.	The liability of the operator should be unlimited: - for property accepted for safekeeping - for property the operator refused to accept for safekeeping which he/she was bound to accept as a general duty.
16.	The operator should be entitled to examine property which is tendered for safe keeping and require that it be put in a fastened or sealed container.
17.	The liability of the operator for property other than that received by him for safe custody (and other than that referred to in 13 and 14 above) should be a maximum of $500 in respect of any single event ….
18.	The operator's liability for the property of guests should apply in those situations where the operator takes charge of this property outside the premises of the establishment, and also during and for a reasonable period before and after the time the guest is entitled to the accommodation.
19.	The operator should not be liable for the personal property of guests to the extent that damage, destruction or loss of the property is due to the negligence or to the wilful act or omission of the guest, of any person accompanying the guest, or in his employment or of any person visiting him; to an unavoidable and irresistible event which cannot be imputed to him; to the nature of the property.
20.	The operator should not be liable for the property of guests in situations where the guest assumes exclusive charge and custody of the property or the room so as to show an intention to relieve the operator from all responsibility.
21.	Just as operators have a right to know the extent of their liability under the law, travellers also have the right to be informed about the liability provisions that apply to the establishment. For this reason it is important that the provisions in the Act requiring a notice to be displayed in the reception office and in the room occupied by the guest be retained.
22.	The display of the notice should continue to be a condition for limiting the liability of operators to $500 in respect of goods not offered for safekeeping.
23.	The notice displayed should be written in simple language so that it is easily understood by travellers.
24.	In establishments which have a known non-English-speaking clientele, the notice displayed should also be in the appropriate community languages. Alternatively, the notice should be shown in English and translated into the appropriate language(s) and included in the Guest Information material.

8.6 The recommendations made above are in part derived from a draft Unidroit convention, which is discussed in Chapter 10. The Committee agrees with the principles outlined above subject to several reservations. First, the Committee considers that guesthouses which provide temporary accommodation to people would and should be covered by the proposed legislation. Secondly, the Committee prefers not to set a limit of $500 on liability for goods not placed in safekeeping, which figure would soon be outstripped by inflation and again be in need of review. Rather, the Committee prefers the method proposed by Unidroit, which is discussed in Chapter 10.[319]

8.7 The Committee also notes that, despite problems being identified with the unlimited liability provision for goods in safe keeping, the review recommended that any new legislation retain this feature. The Committee considers, for the reasons discussed in Chapter 6, that liability for goods in safe custody should be unlimited in Victoria.[320] Finally, the Committee is of the view that a general duty to provide safekeeping facilities should not be imposed on accommodation providers.[321] Given that the proposed new Victorian legislation would cover many different forms of accommodation, it seems inappropriate to impose such a general duty which may place an unfair burden on small operators, such as bed-and-breakfast establishments and small country motels.

Current position in New South Wales

8.8 The review of the NSW Act went no further than the preparation of the discussion paper. The Act has not yet been amended or repealed as a result of the preliminary recommendations made in the paper. However, the NSW government expects to complete a review of the Act in 1998 as part of the national competition policy reforms.

AUSTRALIAN CAPITAL TERRITORY

8.9 A working paper on the Innkeepers Liability Act 1902 (NSW) in force in the ACT was prepared under the Australian Capital Territory Legislation Review Program.[322]

8.10 The paper put forward a number of preliminary recommendations, including the following:

2	Laws concerned with travellers should apply unambiguously to accommodation establishments operating for profit such as a [sic] hotels, motels, or other places where an owner or occupier holds out that s/he will receive travellers and will provide them with sleeping accommodation.[323]
3	Laws concerned with travellers should, where possible, conform to fair domestic and international practice ….[324]
5	As a matter of principle, the liability of members [hotelkeepers] should be determined in accordance with the following rules: liability should be unlimited where it is possible for a member to obtain insurance on a reasonable basis and liability should be limited where it is not possible to insure against the risk.[325]

8.11 The Committee agrees with these broad principles, but considers it necessary to provide greater detail in its recommendations. It is of the view that detailed recommendations will provide clarification of the particular changes which should be made to the Victorian legislation.

Scrutiny of Acts and Regulations Committee
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