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Ian Carroll

Ian Carroll

Legal Director

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Another knock-down for vicarious liability?

Blogs20/12/2018

Clive Bellman (A Protected Party By His Litigation Friend, Susan Thomas) v Northampton Recruitment Limited [2018] EWCA Civ 2214

The Court of Appeal has handed down its judgment in a case concerning the scope of vicarious liability in circumstances where an employee’s wrongful conduct occurred outside of both office hours and the workplace.

Background

On 16 December 2011, Northampton Recruitment (NR) held a Christmas party for its office staff and their partners at a golf club. NR had three directors and shareholders; one of whom was Mr Major. Mr Major was also Managing Director, authorised to act on behalf of NR, with a wide remit.

Post-event drinks

As the party was drawing to a close, Mr Major paid for taxis to take all those who wanted to accompany him to the Hilton Hotel, for the purpose of consuming additional drinks. Most of those attending were staying at the hotel at NR’s expense. The claimant, who was employed as a Sales Manager, and his accompanying partner were not staying at the hotel.

At around 2.00am and at all times thereafter, the conversation between the remaining employees turned to work issues. At 2.45am a group of six people (including Mr Major and the claimant) ventured outside the hotel and continued their work-related conversation. The claimant mentioned another employee, Mr Kelly, who was understood to be a relatively new recruit to the company. The claimant raised issue with reports that Mr Kelly was reportedly being paid substantially more than anyone else. At this point Mr Major became annoyed and returned to the hotel lobby.

Once inside, Mr Major summoned the remaining employees (including the claimant) and began to lecture them on how he owned the company, was in charge and that any senior decisions were his to take. The claimant suggested Mr Kelly would be better placed in a different office. Mr Major swore as he moved towards the claimant. He punched him, and the claimant fell to the ground. He got back up and Mr Major appeared to have lost all control as he hit the claimant again. The claimant was struck with force, knocking him out. He fell straight back, hitting his head on the ground. This resulted in the claimant sustaining injuries, leading to traumatic brain damage.

Judgment

On appeal, the Court found that there was a sufficient connection between Mr Major’s field of activities and the assault to render it just that NR should be vicariously liable for his actions.

What is the nature of the job?

Mr Major was the “directing mind and will” of NR. He had a wide remit, was in overall charge of all aspects of NR’s business, did not have set hours and had the authority to control his own methods of work. Importantly, the Court of Appeal determined:

“it is not a question of what the employee was expressly authorised to do…it is necessary to consider the field of activities assigned to the employee in a broad sense and to look at the matter objectively taking account of the position in which the employer has placed the wrongdoer…the Court is required to look at the field of activities broadly”.

The Court of Appeal found that both Mr Major’s remit and his authority were wide-ranging.

Is there a sufficient connection between the position held by the wrongdoer and his wrongful conduct?

Despite the time and place of the incident, the Court of Appeal considered that Mr Major was purporting to act as Managing Director of NR. His managerial decisions having been challenged by the claimant, he sought to exercise his authority over his employees and in doing so misused the position entrusted to him by NR.

On the facts, whilst the Court of Appeal found that the unscheduled drinking session was not “a seamless extension” of the Christmas party, it must be seen against the background or in the context of the evening’s events, thus drawing the distinction with a casual drink with colleagues after work.

It was further considered that even if Mr Major “had taken off his managerial hat” when he arrived at the hotel, he chose to put this hat back on when his managerial decisions were challenged and he chose to re-engage his wide remit as Managing Director.

Conclusion

The purpose of vicarious liability is to hold someone responsible for the actions or omissions of another. For example, in a workplace context an employer could be liable for the acts or omissions of its employees - provided it can be shown that they took place in the course of their employment.

The implication of this decision is to expand the scope of vicarious liability further to include unauthorised activities that do not take place within the traditional definition of the workplace. As such, the judgment represents a widening of the pool of circumstances in which an employer could be held liable for an employee’s actions including where that employee has abused the position entrusted to him.

Notwithstanding the above, Lord Justice Irwin helpfully set out at paragraph 40 of the judgment:

“Liability will not arise merely because there is an argument about work matters between colleagues, which leads to an assault, even when one colleague is markedly more senior than another. This case is emphatically not authority for the proposition that employers became insurers for violent or other tortious acts by their employees”.

This decision turned on the facts of the case and Lord Justice Irwin was keen to point out “how limited will be the parallels to this case”. As such, whilst the scope of vicarious liability has expanded slightly, it will not provide carte blanche liability of employers in respect of any acts or omissions of their employees, regardless of the circumstances.

Whilst organisations must continue to stand firm on valid liability arguments, it will be important to pay due consideration to not only the employee’s nature of his duties but also to the “…field of activities broadly” when considering the status of vicarious liability.

For more information, please contact Ian Carroll and Patrick Williams