Uses and Risks of Commercial Drones (Stadium's)

Remotely Piloted Aircraft, more commonly called drones have gone from being used by militaries and hobbyists around the world to a key asset for businesses across industries. A McKinsey report detailed the surge in the value of drone activity from $40 million in 2012 to $1 billion in 2017 just in the United States.

One of the big issues with the adoption of drones commercially is the uncertain application of the law. The Civil Aviation Safety Authority (CASA), has introduced a number of regulations covering flight operations, as well as requirements for licencing and accreditation. There are also draft ISO standards just released.

However, for a business, the big question is – if we use drones and something goes wrong what is our liability? And, more importantly, how do we minimise and manage this liability? In some areas it can even go further than this – what if someone else is using drones, illegally or not in the vicinity of our business, staff or customers. Do we have a duty to protect people from these activities? None of these issues have, as yet, been before the courts in Australia. 

This article explores this question of managing liability in the current Australian legal framework. In order to work with specifics, we have chosen to focus on stadiums and sporting venues (“Stadiums”). This industry will enjoy great commercial benefit from the use of drones. It is also open to the risks associated with the misuse of drones by third parties.

Commercial uses for drones in Stadiums 

• There are many areas where Stadiums can use drone technology:
• Assistance with repair and maintenance of assets - Heights and Confined Spaces 
• Crowd control and surveillance
• Emergency force multiplier 
• Media of the event (either themselves or selling the rights to third parties who operate the drones)
• As an integral part of the entertainment. ie example is a drone swarm rather than fireworks https://fortune.com/2018/06/14/drone-swarms-fireworks-china/.

In its base CASA Regulations prevent drones being flown over a populated areas and within 30 metres of people, which on the face of it prevent the use of drones during Stadium events. However, CASA can give approval to allow Stadium operators to deviate from ‘standard operating conditions’, part of this process includes ensuring drones are certificated and that the operator is adequately qualified to operate the drone. This process would need to be navigated before the drones were used commercially.

And then, a drone falls from the sky

Let’s consider a very specific adverse event. Let’s imagine a crowded sporting stadium hosting an AFL Grand Final. The Stadium operator is using a drone to collect footage and photograph the event. They have received CASA approval to use the drones above the crowd. The drone pilot is not an employee of the Stadium but an individual who is an experienced pilot, licenced by CASA. He provides drone pilot services to many organisations, he owns the drone.

Ten minutes after “the bounce” the drone inexplicably falls from the sky. It plummets into the crowd, seriously injuring a patron – what happens next? 

Who is liable?

Duty of care

Under Australian law there is an established duty relationship between venue occupiers and lawful entrants (invitees). Where entry on the premises is lawful, the relationship in itself, is generally sufficient to establish, on the occupier’s part, a duty to take reasonable care to avoid a foreseeable risk of harm from occurring.

This means that should a Stadium use a drone, and should it fall from the sky and injure a patron there is a clear case for a damages claim against the Stadium operator. The injured party would argue that as an occupier of a premise, the Stadium owes them a duty of care. Although this point is uncontentious, the injured party would then need to convince a court that the standard or level of duty of care they are owed extends to protections against falling drones. Finally, the injured party would need to prove that there has been a breach of this duty of care and they have suffered recognized loss as a result.

The standard of care is determined on a case by case basis, however the formulation as it relates to occupiers which has been adopted by the High Court of Australia in Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479 is:

“The touchstone of its existence [duty of care] is that there be reasonable foreseeability of a real risk of injury to the visitor or to the class of person of which the visitor is a member. 

An existence of a duty of care by Stadiums would then seem to turn on whether injury by drones within the premise is deemed a real risk. 

The risk to the public of a drone flying across a crowd is, I would argue, foreseeable. The fact that CASA require special approval, deeming it “special operating provisions” indicate that it is considered a foreseeable risk.

If the finding of the existence of the duty of care is inevitable (or at least highly likely) in these circumstances, then the question is how can the duty of care be satisfied? 

How can a Stadium satisfy it’s duty of care?

No Australian court has yet considered what is required by a Stadium (or any other commercial drone operator) to establish that they have complied with their duty of care.

However, in the same formulation from Safeway Stores, the High Court reasoned that:

“The measure of the discharge of the duty is what a reasonable man would, in the circumstances, do by way of response to the foreseeable risk."

There are two options for what went wrong in relation to the incident; human error or technological/mechanical failure. I suggest, these are the areas that we should be focused on as foreseeable risks.

Applying the principals from Australian cases dealing with occupier’s liability we recommend a Stadium considering the commercial use of drone technology take the following steps.

Consider the benefits/risks of drones

These should be thoroughly considered and documented. Drone experts should be briefed to consider and document potential uses of drones in the Stadium and set out the risks and their likelihood. The Institute for Drone Technology ? provide these services and are recognised leaders in the industry. This review should be considered at the appropriate level within the Stadium operators organisation before any decisions are made (or any drones used).

Who is flying the drones?

In our example it is a CASA Registered pilot who is contracting to the Stadium. In these circumstances the Stadium should carry out some due diligence on this operator and should have a formal agreement with them. This agreement should set out where the risk and liability falls and the pilot’s obligation of competency and care. Where the pilot is an employee of the Stadium operator then this will require an employment agreement and policies in place which indicate that all “human error” risks have been considered and mitigated.

Operations on flying days

CASA Regulations and approvals must be complied with, and there needs to be a systematic approach to recording this. This is where Dronesafe ? can provide a solution. Dronesafe?’s product is a structured and consistent step-by-step pre- and post-flight checklist for drone pilots to ensure safe and effective usage while also providing an audit trail of all flights. The use of this system would be a relevant factor for a court when considering the satisfaction (or otherwise) of the Stadium’s duty of care.

Fitness of the Drone

If the cause of the accident was drone failure (as opposed to pilot failure) then the courts would want to know how the Stadium had ensured the drone was fit to fly. In the incident the drone was owned by the pilot. In the Stadium’s agreement with the pilot there should be warranties about the maintenance and reliability of the drones used. Management systems The Dronesafe ? system also deals with aspects of this – battery charging for example. 

Policies and Procedures

A court would expect the Stadium to have well documented Policies and Procedures relating to drone use. These would come out of the The Institute of Drone Technology ? ‘s discovery workshop at 1 above. The Stadium’s OHS Policy would also need to be considered and updated in light of commercial drone usage. This is, of course, another area of potential liability for the Stadium. 

Staff training

Policies and Procedures are no use sitting in a bottom drawer. Once drafted there would need to be structured staff training relating to drones and their risks. The Institute of Drone Technology ? is also an expert in training in the drone industry and would be able to assist with this.

In addition to these steps, we would also recommend a review of insurance policies to ensure misadventure through drone is covered. 

What about drones that are in the area, but not flown by (or on behalf of) the Stadium?

With large, relatively open spaces, Stadiums have proven highly alluring to recreational drone operators who revel at the chance to capture footage of a grand final or a summer music concert from new heights. CASA Regulations state that drones cannot be flown within 30 metres of people or over a populated area. There have been numerous cases where hobbyists have been fined by CASA for overflying these areas. This year a man found to have breached these rules by flying his drone over Suncorp Stadium during an Ed Sheeran concert was fined $1,000. 

In this incident nobody was harmed but the question is what if this third-party drone, that was breaking the law at the time, had fallen and injured someone inside Suncorp Stadium, could Suncorp be liable?

In Adeels Palace v Moubarak (2009) 239 CLR 420 Mr Moubarak and Mr Najem were shot by a gunman within at Adeels Palace (a nightclub) during a New Year’s Eve party. The court ruled that a duty of care by a venue can extend to protecting patrons against violent and illicit acts of others within the venue. 

The ruling in Adeels is a clear precedent for holding licensed venues responsible for injury incurred due to third party acts on the premises. Whether this would extend to stadiums and drones is yet to be seen. However, it is worth noting that many of the features and statutory obligations which the court referenced in Adeels also applies in the case of Stadiums. Stadiums also have an obligation to ensure a safe space for spectators, this involves minimizing anti-social behavior, evicting violent or troublesome patrons and conducting bag checks. It is possible the courts could extent this to protecting patrons from drones that are being misused.

Would the courts consider that a Stadium should have counter drone technology to protect patrons? Should they have security patrolling the outside of the Stadium to shut down illegal drone operations when they occur? Once again, all these measures are things that The Institute for Drone Technology ? is expert in and we could advise Stadium operators. These issues should be considered thoroughly and carefully.

Is there strict liability for drones?

There is a risk that drones can fall under the definition of aircraft, which would mean damage or injury by them may fall under the Damage by Aircraft Act 1999 (“the Act”). 

The question of whether drones fall under the definition of aircraft is yet to be tested by the courts. The only guidance we have from the statute states that an aircraft does not include model aircraft. 

‘Model Aircraft’ is not defined in the 1999 act but a definition exists within the Civil Aviation Safety Regulations 1998 as:

“[A]n aircraft that is used for sport or recreation, and cannot carry a person”

Since stadiums would be using drones outside this defined purpose, there is a chance the courts deem drones in these situations as aircraft.

Section 7 of the Act specifically states that an employee that uses an aircraft in the course of his or her employment (irrespective of whether the employee is authorized), for the purposes of the 1999 Act, the Stadium is taken to have been ‘used’ the aircraft.

In the incident set out in this article the operator of the drone was a consultant, not an employee. The question is – could using this structure protect the Stadium from strict liability? Once again, this requires careful examination of the relationship and consideration of circumstances where parties “identified as contractors” are actually found to be employees. These issues need to be considered and reflected in formal agreements between the Stadium and any drone pilot.

It may be that the first case to come to court in Australia will not just argue breach of duty of care, but in the alternative will allege there is strict liability in relation to drones under the Act.

Drones are poised to provide incredible opportunities for Stadiums, but this is not without risk. 

In order to adequately mitigate the risks, we suggest the first step is to engage with the experts at The Institute for Drone Technology ?. 

Every day new things happen in this space, a business operating drones needs to keep up to date and make sure that all the steps above are constantly updated in light of changes to laws, court cases and movements in technology.

Want to know where to start?

The Institute for Drone Technology? is a drone consultancy, a RTO (no 45181) and approved CASA training provider.

www.dronetechinstitute.com

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