Keoghs Insight

Author

Nicola Markie

Guidance on vicarious liability and non-delegable duties

Client Alerts20/04/2021

The High Court has now handed down the judgment in SKX v Manchester City Council [2021] EWHC 782 (QB) which provides further helpful guidance on vicarious liability and non-delegable duties where local authorities place children in their care in private children’s homes.

Background

The claimant sought damages against the local authority arising from sexual abuse suffered at the hands of J, a chief executive of a privately run children’s home to which the claimant had been sent whilst in the local authority’s care.

J has been convicted at three major criminal trials of numerous historic sexual offences for minors at the home. At the second of these trials J was convicted of three counts of indecent assault against the claimant.

The claimant attempted to recover damages directly from the company who owned the children’s home for the harm he suffered in a group litigation with many other claimants. The claimant was awarded damages by the Court, but damages were never paid as the insurers of the company relied upon a clause in the insurance policy that excluded them from liability.

All hopes of a recovery against the company were at an end resulting in a group of claimants bringing claims against the local authority. This claimant was chosen as the test case.

The claimant sought damages not on the basis that the local authority was directly at fault for the abuse he had suffered, but rather the local authority is liable on one of the two alternative grounds:

  • The local authority was vicariously liable for the acts of J; or
  • The local authority’s duty to protect and care for the claimant was a non-delegable duty.

Vicarious liability

The claimant argued the local authority is vicariously liable for the abuse carried out by J, even though he was an employee of the company which ran the children’s home. It was argued that in recent years a series of Supreme Court cases had led to the extension of the doctrine of vicarious liability, extending it beyond the scope of the traditional employer/employee relationship. For example, in Armes v Nottingham County Council (2017), the Supreme Court held that a local authority was vicariously liable for acts of abuse of a foster parent against a child who had been placed in the local authority's care pursuant to a care order and that by parity the local authority should be vicariously liable for the actions of J.

The local authority submitted that the limits of the extension of vicarious liability were made clear by the Supreme Court in Various Claimants v Barclays Bank (2020) and the local authority could not be liable for the acts of J who was not an employee or akin to an employee.

The judge agreed with the defendant and found the local authority could not be vicariously liable for J’s actions. He noted that in light of the analysis of vicarious liability by the Supreme Court in Barclays Bank, the central question is whether the relationship between the wrongdoer and the person who is alleged to have vicarious liability is akin to employment. If the wrongdoer is carrying out an independent business of his own or that of a third party, then there will be no vicarious liability.

In this case J was carrying out an independent business on behalf of the company that operated the children’s home, not the local authority. The fact the local authority placed the children did not mean that employees were effectively employed by the defendant. The position could be distinguished from Armes as the local authority recruited the foster parents as individuals, the authority paid allowances to them and provided them with equipment. Therefore they could not be classed as carrying out an independent business of their own. This was clearly not the case with the local authority and J. The relationship with the local authority and the company running the children’s home was a classic client/independent contractor relationship and it would not be fair, just or reasonable to impose vicarious liability

Non-delegable duties

The claimant submitted in the alternative that the local authority owed a non-delegable duty to ensure that reasonable care was taken for the safety of children in “voluntary” care when that child was placed in a privately-run children’s home under the Child Care Act 1980 Act, section 21(1), and that this consisted of a continuing duty to provide daily care for and to protect the child and could not be delegated.

The local authority submitted that the judgment of the Supreme Court in Armes provided a complete answer to the claimant's claim based on non-delegable duty.  For the same reasons that the Supreme Court held in Armes that a local authority does not owe a non-delegable duty to protect a child in care from harm when that child is placed with foster parents under the 1980 Act, section 21, the local authority in the present case did not have a continuing non-delegable duty after placing him at a children’s home.

The Judge found the local authority did not have a non-delegable duty to protect the claimant when he was placed in a privately run children’s home.

He agreed the chief authority was Armes and the Supreme Court found the statutory regime did not impose responsibility upon the 1980 Act for the day-to-day care of the child whilst in the placement, or a duty to ensure that no harm came to the child. In light of this reasoning a local authority's duty under the 1980 Act was to arrange, supervise and pay for the child's day-to day-care only. There was no non-delegable duty to ensure that care was taken for the claimant whilst he was placed with a third party in accordance with the defendant's power to do so under section 21(1) of the 1980 Act.

Commentary

This is the first case to consider vicarious liability and non-delegable duties when placing children in privately run children’s homes. It confirms local authorities will not have a liability in these circumstances and any claims held with similar circumstances can be denied on these grounds.  It also provides clear legal analysis of the Supreme Court guidance on vicarious liability and non-delegable duties, which will be helpful in the handling of local authority claims where there is no clear liability on the facts.  

For more information, please contact Nicola Markie, Solicitor.