1993
In early May a couple withdrew all of their savings from two banks in Sydney and took the proceeds to a different bank in Oxford Street.2 They joined a queue waiting for a teller and were called. They discussed the establishment of a term deposit with the teller and also talked about a house loan with a loan officer.
These discussions were evidently satisfactory, and the wife withdrew the cash from her handbag and placed it on the counter in two bundles of cash, one of $4080 and one of $2000. The husband had counted this money out for the loan officer, but the officer had not yet taken possession of the money or counted it.
The bundle of notes containing the $4080 was snatched from the counter by a man who ran away. The husband chased the thief but the thief disappeared into a dark car park, and the husband, wisely, abandoned the chase.
The teller of the bank rang the police, but according to the report there were no security guards in the bank and the security camera failed to capture the incident for reasons that are not explained.
The branch manager is quoted as saying: "It's a police matter. I suggest you contact them. I have no further comment."
The attitude of the branch manager is the one which is justified by reference to the leading case on the subject, Balmoral Supermarket Ltd v Bank of New Zealand.3 The plaintiff's employee entered the bank intending to deposit a sum of money. The cash was emptied out of a bag onto the counter midway between the customer and the teller. The teller took a small bundle of notes and proceeded to count them. After $100 had been counted and put to one side, robbers entered ant took the uncounted cash from the counter.
The plaintiff argued that possession of and property in the cash had passed to the bank, but the court held that until the money to be deposited had been checked by the teller and the bank had signified its acceptance thereof the money had not been deposited and the bank had not become the debtor of the customer in respect of that money.
This decision is clearly correct. Generally property in cash passes with possession; 'legal possession' means power to use a thing and exclude others accompanied by animus possidendi, provided that no one else has the animus possidendi and an equal or greater power.
The position is further illustrated by the old case of Chambers v Miller.4 There the customer of the bank wrote a cheque. The teller counted out the money and passed it to the customer before noticing that the account was overdrawn. The teller demanded the return of the money and, when the customer refused, attempted to reclaim it by force. The customer successfully sued for assault and false imprisonment, the court noting that the payment was complete when the customer obtained possession of the money.
The Balmoral case appears to have been argued exclusively on the ownership of money point. It is by no means clear why this is so, but it is clear that it does not conform entirely with public expectations. The treatment by the press shows that there is a perception that a bank owes some duty to its customer to protect the customer and the customer's property while inside the bank.
The law recognises similar duties. The liability of occupiers which once rested on a bewildering system of classification related to the status of the victim is now a part of the general law of negligence.5 The type of danger, its obviousness to either the occupier or the visitor and the status of the visitor are now relevant only as factors in determining if the general duty of reasonable care has been observed.
The duty may extend to a duty to control the actions of third parties, a situation which has most often arisen in an entertainment context. A publican owes a duty to protect patrons from foreseeable attacks by other patrons.6 Persons conducting a motor race owe a duty to provide adequate safeguards for spectators to protect them against the foreseeable hazards of the spectacle.7
The situations mentioned in the preceding paragraph relate to personal injuries, but there is also a duty to protect the property of the visitor from damage, even when that property damage is not consequential on personal injury.8 Further, it is generally acknowledged that both the existence and the scope of the duty is higher when the defendant stands to gain an economic benefit from the relationship with the plaintiff.9
Not only is there a duty to protect property from damage, but the liability may extend to consequential economic loss if such loss is not too remote.10 However, it is doubtful if there is a duty to protect against economic loss which is not consequential on either personal injury or damage to property.11
It seems beyond argument then that the bank owes it customer a duty of protection when the customer is on the premises. Has that duty been breached in the circumstances outlined above?
On the customer's behalf we should note that the entry is associated with an economic benefit for the bank. That the event is foreseeable is evidenced by the elaborate security precautions taken by most banks for the protection of the money on the business side of the counter, precautions which involve physical shields and security cameras. Oxford Street Sydney is a location where we might expect the need for security guards. The loss was a loss of property, not a pure economic loss.
On the bank's behalf we must argue that there was no physical injury. The duty to control others may not extend to a duty to prevent them from stealing from the customer.12
On balance it is clear that the customer has a good arguable case and that it would be open to a court to find that the bank had been negligent in failing to protect against the theft. Such a decision would also be sensible from a policy perspective since the bank is in a position to guard and insure against the risk whereas the customer can do neither.