Wednesday, 30 November 2016

Vicarious liability - when will an employer be liable for the wrongful acts of an employee?

The recent High Court decision of Prince Alfred College Incorporated v ADC [2016] HCA 37 (PAC) provides guidance on the approach to be taken by courts in determining whether an employer is liable for the wrongful (criminal) acts of an employee. The previous leading case, New South Wales v Lepore [2003] HCA 4 (Lepore), provided no majority view in respect of this issue.

PAC is highly relevant to government departments and agencies, as it specifically concerns the approach to be applied in cases dealing with the abuse of vulnerable persons in educational, residential or care facilities, by persons employed in special positions with respect to these vulnerable persons.


In 1962, ADC was a 12-year-old boarder at Prince Alfred College in Adelaide (College). A senior housemaster and three housemasters, including Dean Bain (Bain), were in charge of the dormitories. Although the housemasters were present during meal times, prefects supervised the day-to-day activities of the junior boys, including showering and lights out. Bain was rostered on a few times a week, was often around during shower time, and told stories to the boys in the dormitory after lights out. The other housemasters did not supervise lights out and did not come into the dormitory. ADC alleged that Bain first molested him when Bain was telling a story during lights out, progressing to being molested in Bain's room, and on one occasion when Bain took him to a house where they spent the night together.

Primary proceeding 

ADC sued the College, arguing (among other things) that it was vicariously liable for Bain's abuse, which had caused him to suffer psychological injury. It was not in dispute that ADC had been abused by Bain, as he had been previously convicted of two counts of indecent assault against ADC. The primary judge dismissed the proceeding, declining to extend the time for ADC to bring proceedings. In respect of the vicarious liability claim, Vanstone J concluded that the sexual abuse was 'so far from being connected to Bain's proper role that it could neither be seen as being an unauthorised mode of performing an authorised act, nor in pursuit of the employer's business, nor in any sense within the course of Bain's employment'.

Appeal to Full Court

ADC appealed to the Full Court of the Supreme Court of South Australia, and was granted an extension of time to bring the proceeding. Each member of the Full Court also found the College to have been vicariously liable, but the approaches taken by the judges differed from that taken by the primary judge and differed as between themselves. Factors considered by the judges included the 'spectrum' of intimacy (in this case, ADC being a 12-year-old boarder with a housemaster exercising quasi-parental authority in respect of 'intimate' matters such as showering and bed), that the College enhanced the risk by allowing Bain access to the children without supervision, and that Bain was in a position of power over ADC, with respect to matters of order and discipline.

Appeal to High Court 

The High Court allowed the appeal by the College on the basis that an extension of time to commence the proceeding should not have been granted by the Full Court, and that the issue of liability should not have been considered by the primary judge (ie after the judge had determined the proceeding was out of time). However, the High Court acknowledged that, since Lepore, lower courts have been left in an uncertain position about the approach that should be taken in vicarious liability cases of this kind, and that there was a need for guidance to reduce the risk of unnecessary appellate processes arising out of the existing uncertainties.

The relevant approach 

The majority judgment held that the fact that a wrongful act is a criminal offence does not preclude the possibility of vicarious liability, it being possible that in the commission of that act, the employee used or took advantage of the position in which the employment placed the employee in relation to the victim.

Their Honours considered therefore that the relevant approach in determining vicarious liability is to consider any special role that the employer has assigned to the employee, and the subsequent relationship between the employee and the victim, with particular regard to the following features:

  • Authority;
  • Power;
  • Trust;
  • Control; and
  • The ability to achieve intimacy with the victim. 

It was noted that the latter feature may be especially important, it being conceivable that where an employee takes advantage of his or her position in these circumstances, that may suffice to determine that the wrongful act should be regarded as being committed in the course or scope of employment, and as such render the employer vicariously liable. However, their Honours also noted that it was conceivable that while unlawful acts committed in a workplace would attract vicariously liability, some or all of such other unlawful acts committed outside the workplace would not (for example, the offending by Bain which occurred in a house).

The minority judgment accepted that the relevant approach described in the majority judgment will now be applied in Australia, but noted that it does not and cannot prescribe an absolute rule, and that applications of the approach must and will develop case by case.

Andrea Robinson
Principal Solicitor

Anna English
Managing Principal Solicitor

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