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Vicarious liability - A useful reminder

Vicarious liability came back before the court at the end of last year in a case which provided a good reminder of the applicability of this important legal principle. The judgment sets out a useful guide to the key case law on this issue, as well as providing a summary of the issues to be addressed. In the matter of Kennedy v Sheldon Inns Ltd (t/a The King's Arms) [2022]11 WLUK 579 the court was asked to consider whether vicarious liability would exist beyond the usual employer/employee relationship. The facts behind the case concerned a fight in the Kings Arms pub in 2018 between a customer and Mr Johnstone, the husband of the landlord. The pub in question was owned by Star Pubs, who let it, on a tied basis to the defendant, Sheldon Inns Limited. The defendant contracted Mrs Johnstone to run the pub. After the assault the claimant brought a claim for personal injury against the defendant alleging that it was vicariously liable for the tortious acts of both Mr and Mrs Johnstone.

The assault in question took place whilst Mr Johnstone was ejecting Mr Kennedy from the pub. Whilst the 2 men were outside the pub, CCTV showed Mr Johnstone forcefully shove Mr Kennedy away, when he attempted to reapproach the pub, and Mr Kennedy fell, sustaining head injuries. Mrs Johnstone was not present at this point and there was no evidence that she knew of, or ratified the assault.

The contract for management of the pub was only between the defendant and Mrs Johnstone, not Mr Johnstone. The said contract emphasised that it was a contract for services and that the contractor was a self employed individual. The defendant supplied to Mrs Johnstone the fully functioning public house together with the drinks to sell, however she was not authorised to do anything on their behalf. She had autonomy to supply her own labour to man the pub, if she could not run it she was responsible for locating a substitute and she was responsible for appointing an accountant. There was no evidence of any sort of legal arrangement between the defendant and Mr Johnstone and it seems to have been an informal arrangement that he would assist his wife with the pub.

In the judgment the court noted the comments from Catholic Child Welfare Society and Others v Various Claimants and the Institute of the Brothers of the Christian Schools and others [2012] that "The relationship that gives rise to vicarious liability is in the vast majority of cases that of employer and employee under a contract of employment." It is however important to note that "Today it is not realistic to look for a right to direct how an employee should perform his duties as a necessary element in the relationship between employer and employee. Many employees apply a skill or expertise that is not susceptible to direction by anyone else in the company that employs them. Thus the significance of control today is that the employer can direct what the employee does, not how he does it." The court then reiterated that there is a two-stage test to be satisfied before vicarious liability can be imposed; as confirmed by Lady Hale in Barclays Bank plc v Various Claimants [2020]:

"The first is a relationship between the two persons which makes it proper for the law to make the one pay for the fault of the other. Historically, and leaving aside relationships such as agency and partnership, that was limited to the relationship between employer and employee, but that has now been somewhat broadened…

The second is the connection between that relationship and the tortfeasor's wrongdoing. Historically, the tort had to be committed in the course of within the scope of the tortfeasor's employment but that too has now been somewhat broadened"

Finally WM Morrison Supermarkets Plc v Various Claimants [2020] confirms that the question is whether the wrongdoing was so closely connected with acts that the wrongdoer was authorised to do that the wrongdoing may fairly and properly be regarded as done by the wrongdoer whilst acting in the ordinary course of his employment.

After consideration of the past case law the court confirmed that in this matter the claimant failed at stage 1 of the test. Mrs Johnstone was carrying on her own independent business from the defendant's premises. Whilst the defendant preserved some contractual entitlements such as requiring the business of the Pub to be open during normal opening hours and requiring Mrs Johnstone to reside on site, Mrs Johnstone was generally free to conduct her business and provide her own labour as she saw fit. As such the claim in vicariously liability for any tort committed by Mrs Johnstone against Mr Kennedy would fail at stage one.

So far as Mr Johnstone was concerned, there is no relationship at all between himself and the defendant which could give rise to a vicarious liability on the part of Sheldon Inns Limited.

It is therefore clear from this case that the previous tests for vicarious liability remain valid. Whilst an actual employment contract is not needed for vicarious liability to be found, there does need to be a sufficient closeness to demonstrate a sufficient element of control in order for vicarious liability to apply. The court will not currently expand this principle into situations where there is a truly independent contractor, and certainly not where there is no business relationship. As a result if you are faced with a claim in respect of a contractor it is crucial to assess the reality of the situation to assess the level of control provided to the defendant over the actions of the person in question to decide liability.

For more information contact Claire Opacic in our Insurance department via email or phone on 01618308817. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

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