Feb 262020

We would love to walk you through the complete details of vicarious liability. We will stick to the definition of it, details, elements, principles, etc in general. Yet, our examples will talk about real cases about vicarious liability in Australia.

Even before providing the definition, let me help you pronounce the word “vicarious.” Don’t think I am underestimating you. I found it difficult to call out this word and thought of sharing my findings with you all.

It will be easy if you split it this way V K Ri Es – VKRIES

I am sure this will help you now. I am glad to provide you with every single detail about vicarious liability.

Without wasting time, let us get on to the details.

Vicarious Liability – Definition

The moment you see the word definition I can understand that you feel anxious about theory. Trust me, not difficult at all. In simple words, we call vicarious liability as one person held for the mistakes of another. To further extend, the former has given some authority to the latter. Therefore, when the latter does any mistake intentionally or by negligence the former must face the consequences.

We shall understand with some examples

What does it mean to be vicariously liable? – Examples of vicarious liability

Vicariously liable means held responsible for not a direct mistake but indirect. You might have not committed any mistake but a person with whom you associate does it. You may wonder why you should own for another individual’s mistake. But, vicariously liability means that only.

Get some clarity with the examples given below.

  1. You run an organization and appoint some employees. You are responsible for their actions during office hours. If they misbehave to their colleagues, then you need to answer legally.
  2. Likewise, parents hold the ownership for the mistakes done by their kids.
  3. Another best example, the contractor gets penalized for subcontractor carelessness, etc.
  4. The brake inspector receives a call when a vehicle makes an accident. Can you now relate vicarious liability better?  
  5. In a partnership firm, any one of the partner’s become answerable for another one’s mistake.
  6. The person who signs surety for bank loan gets caught when the loan seeker defaults payment.

I can add more but will stop and you can find real-life cases in this article when you continue reading.

Elements of vicarious liability Australia

With reference to the vicarious liability, the following elements need consideration

  • The parent becomes liable to a minor child for its negligent act
  • The employer will hold accountability for their employees as they have engaged the defendant
  • The employee acts within the range of employment
  • The employer has empowered the employee to carry out a certain task
  • The employer failed to warn the employee for the wrongful act
  • The employee has created a material or emotional loss to another party during office hours

Principles of Vicarious Liability

In general, the principles of vicarious liability states that the employer must answer for the wrongful act of their employees. Yes, when the employee carries out an authorized act but in an unauthorized way.

You can also relate this with the common law principle that mentions, one’s wrongful action will affect another due to the vested common interest. This means let us assume, an employee bribe for fetching an order. The employee has committed a sin legally. However, this action has helped the employer to get business. Therefore that employer holds ownership for motivating the employee to bribe and get the order.

Australian Laws that govern Vicarious Liability

You must make yourself aware of the Wrongs and Other Acts (Law of Negligence) Act 2003 to know about vicarious liability (Law of negligence). This comes under the Common law – Principles of negligence and the Wrong Act 1958 (Vic). Further the amendment Wrongs and other Acts 2003.

Section 103

Joint wrongdoers Part 2.5 (Proceedings against and contributions between wrongdoers) applies if 2 or more people are liable (or, if they had all been sued, would have been liable) under section 102 for the damage suffered by a person.

107D Concurrent wrongdoers

           (1)   For this chapter, a concurrent wrongdoer, for a claim, is 1 of 2 or more people whose acts or omissions (or act or omission) caused, independently of each other or jointly, the loss or damage the subject of the claim.

Vicarious liability cases in Australia

So far we have explained the theoretical aspects of vicarious liability. In the next section, we will present you with factual information. Yes, you can find real-time examples of vicarious liability cases in Australia. While we will provide you with the case details and the judgment as well as link you to the actual source for detailed information.

Case 1

As early as 1960 this case came to the court which involved the boarder ADC in Prince Alfred College. It was a sexual abuse case and Bain who was the assistant boarding housemaster. The court accepted the charge and later convicted Bain in 2007. ADC further appealed in the court about this case and mentioned that the college is vicariously liable for the abuse that happened to ADC. Initial court judgment confirmed the college as guilty and then they appealed to the high court. However, the high court decision was favoring the college. Therefore, it is vital to note from this case that the first decision was against the college and hence the employer needs to exercise caution as their employee’s illegal activities will make them liable for.

Case 2

This case is all about an employee or an independent contractor. Whether the company is vicariously liable or not for the action of an independent contractor.  Vabu Pty Ltd ran a bicycle courier company and an independent contractor of this company struck a pedestrian (Hollis) during work hours. He was wearing the company jacket with its name on it. The court considered the employee status, damage caused due to the accident, the company’s control over the worker, the documents, etc and provided judgment. You must read the full case and understand details about vicarious liability with respect to this case.

Case 3

In this case, the refrigerator door that was faulty hit Sweeney and she got hurt. Sweeney filed a case and it primarily investigated to understand whether the company owner’s negligence led to this accident. The already complained faulty door came to the mechanic’s notice and he came for checking. Now, who is vicariously liable? The company or the mechanic, as he was not an employee but a contractor.

Find the high court verdict

“The conclusion that the mechanic was an independent contractor is determinative of the issue that arises in the appeal and that accordingly the appeal must be dismissed with costs”.

Note: Quoted as-is from the source.

Case 4 and 5

  • In the Leslie and Graham case [2002] FCA, the case started to analyze if the employer’s negligence caused sexual harassment case. This happened between the 2 employees and during the early hours in the office. These two employees shared a service apartment and came for a work related conference.
  • In another case between Gama and Qantas Airways Ltd (No 2) [2006], FMCA courted confirmed vicariously liability of the airways. This racial discrimination case took sometime before coming to a conclusion. The supervisor who got insulted due to racism complained against the company.

Case 6

AllStaff Vs Coles. The warehouse worker of AllStaff filed a case. He worked as a labour-hire contract, and the pallet mover collided which broke the plaintiff’s right leg. This pallet mover belongs to Coles but AllStaff employee drove the vehicle. The case started to check vicarious liability between Coles and AllStaff. The court mentioned that AllStaff must own the mistake and confirmed their vicarious liability. The driver’s fault led to this accident and the company failed to train him, supervise him and monitor him in action. 

Case 7

Futcher a teacher in Trinity Preparatory School sexually abused Anderson in the mid-1970s. Anderson mentioned in his file that the school’s negligence leads to his misery. The case happened for many years and in the meantime, several school authorities changed. Finally, in 2016 the court gave its verdict. The school should own the mistake of their staff as they delegated the work to the teachers.

Case 8

Here a treatment backfired and let us see what happened. The nurse injected heparin to a patient’s left thigh. Here the vicarious liability lies in the hospital operator’s carelessness. They have failed to train their nurse. They should have monitored the nurse’s job and periodically checked the work.  The first time after injection the plaintiff complained of pain in the leg. Later she witnessed a lump and it slowly developed to a nerve injury.

Case 9

The school caretaker got injured in a gas explosion in Unity Grammar College. LPG gas leak led to the damage. He sued the college, principal contractor, insurer, gas fitting contractor and the supplier. The judgment stated Cohen’s negligence caused this damage. It failed to obtain evidence of LPG installation compliance.

Case 10

This example elaborates on the subcontractor’s vicarious liability case in Australia. The case revolved around the employer, subcontractor, the principal contractor, and the site supervisor. Excavation trench collapsed on a foreman and caused an injury. The judgment charged the employer, subcontractor, and SMJ (principal contractor). The employers must duly provide safety warnings.

We suggest you find more case examples in the below link to have a clear picture of vicarious liability. Click on the link and you will find a page with a search tab on the left side. Type the keyword vicarious and you will find all cases listed under. Feel free to read each case with details and verdict.

Vicarious liability nursing Australia

The nursing manager considered an employer and they employ nurses as employees. For the wrongful act carried by the nurse due to negligence or carelessness will hold the nursing manager liable.

Particular features for a nursing profession include the following

These features have relevance in the employment of nurses. The instances when the nurse has the authority to examine patients will no longer come under sexual abuse. 

  • Patients must remove clothes to let the nurse examine or provide care for an ailment.  At the same time, the nurse must take due care not to abuse the patient due to authority.
  • Integrity and nursing profession go hand in hand and many times making judgment becomes difficult due to the nature of involvement between the nurse and the patients.
  • The nurse does not have the authority to make sexual advances with the patient. In such an event, the nursing manager has a moral responsibility and becomes vicariously liable.

Once a company appointed the third party to carry out medical examination for their employees. The professionals misbehaved to female employees and the company had to face consequences. Even though the company defended about appointing a third party, the court ordered the company to take the liability.  Source

Vicarious liability in tort law

According to tort law, the employer owns the action of their employees. When an employee commits any mistake, then the employer stands guilty per the court of law.

Australian law insists on the following two central conceptions with reference to such cases namely:

  1. Vicarious liability stands associated with the employer and not the principal who appoints the independent contractor.
  2. Secondly, to confirm vicarious liability one must present evidence of the occurrence of misdeed during the course of employment.

This central conception has a slight modification when it comes to child abuse. According to Civil Liability Amendment (Organisational Child Abuse Liability) Bill 2018, “Akin to an employee” (in section 6G(2) of the Bill) states the following.

The employee who performs child abuse has done so for the benefit of the organization will confirm the employer as guilty. Also, in faith-based companies, the employee includes members of the clergy, volunteers, and contractors too.

Yet, these laws have gone through constant discussion and did not come to any final conclusion about vicarious liability. Source

How do you prove vicarious liability?

While we understand the law, we require a fool-proof system to prove vicarious liability. Follow these tests to prove vicarious liability.

Primarily you must understand the relationship between the employer and employee, then the negligence act committed and finally the course of employment. These are important because only when we define the employee-employer relationship, then we can confirm whether the employer holds the liability or not.

Step 1 – Control test

The word control here means the power of the employer on their employee. The employer must clearly know their control over their workers. This will help them to prove guilt-free of the action of the employees. In case, if the employer fails to establish the right control over their staff and a particular staff commits any mistake then the employer has to accept the charges.

Step 2 – Organization test

The employer becomes vicariously liable if they fail to elaborate on their integrity with the employee. This means, if the employee takes the wrong route to achieve business success, then the employer has to face the consequences as they enjoyed the business benefits too.

Step 3 – Multiple tests

The employer should know how to evaluate the worker’s ability. Failing to do so will result in the wrong action and hence penalty not a worker but to the employer. Also, the management must educate employees uniformly to prevent any illegal actions.

Criteria to prevent vicarious liability

Having said that the company should own the repercussions of the mistakes carried out by their employee, the following precautions may prevent any charges on the employer.

  1. Make a clear policy about workplace culture and educate employees about illegal activities and the prohibition of the same.
  2. Obtain support from top management and make a common rule across levels to stay guilt-free.
  3. Ensure to respond to complaints at the first cut to avoid becoming vicariously liable when things go beyond control.
  4. Apart from making policies, make sure to explain that to all employees. Ignorance and negligence lead to major issues most of the time.
  5. Review the policy in a timely manner to add more value to it. This will allow you to run your business without fear of any vicarious liability.

Why is vicarious liability important?

Vicarious liability holds good on all types of businesses that include sole ownership, partnership, and corporations. At all the above-mentioned places the employer has control over their business and employees. This they become vicariously liable for the action of the partners or employees.

It becomes important because the employer must take ownership and provide justice to the victims. Not, necessarily in an office environment, even at home, parents must agree upon mistakes done by their children under age 18.

Importance of vicarious liability

  • The victim requires justice – yes, whoever got affected due to the action of one person must get compensation in some form. For example, if the driver causes an accident, then the owner of the vehicle must provide compensation to the injured. Likewise, parents must provide fairness to the individual or group who got affected due to the wrong action of their kids.
  • Prevent mistakes due to negligence – One cannot escape doing mistakes and mentioning their negligence. Therefore, this law states that any action of an individual requires punishment and the organization must own the act of their employees.
  • Make a righteous environment – Fear punishment, both the employer and employee will execute things that are legal and will not involve in any malpractices.
  • Inculcate responsibility – If a student copied in an examination, the school should take responsibility. Thus they will proactively watch students and will prevent any wrong actions. Thus vicarious liability allows a reformation at all levels.

How do you prove employer negligence?

The practice of vicarious liability stands a better chance to minimize sins. However, the instances when an employer cannot control their employee action. There needs some intervention in such an event to protect the employer.

We wish to provide 4 employer negligence that leads to mishaps. If you can correct your casualness in these areas, then you can stay away from vicarious liability.

  1. Negligent Hiring – When you fail to hire the right employee, then it becomes easy to prove your negligence and you must hold the responsibility of any sin committed by your employee.
  2. Negligent Training – The next step to hiring comes training. When the employer fails to provide necessary training to employees, then again they become liable to their employee misdeeds. Plan and execute the right training to educate employees about the dos and the don’ts.
  3. Negligent Supervision – Further to right hiring and training, when the employer fails to monitor their staff activity, there again it becomes easy to hold them responsible for mistakes.
  4. Negligent Retention – Last comes the retention part. When an employer catches at first sight about some misbehavior of the employee, then they need to make a decision. Ignoring the act or retaining such employees will certainly lead to vicarious liability.

The Outer Limits of Vicarious Liability

The approximation in dividing the line includes the following. The tort law states that another person becomes liable for the tortuous act of one person. The outer limits such as

  • The employer becomes responsible when the employee makes any mistake during the course of employment.
  • Typically authorized employee’s actions will have repercussions on the employer.
  • When the person does a delegated work, then the owner becomes liable.

Vicarious liability for volunteers

The volunteer differs from an employee. Then how vicarious liability does hold good on an employer. We need to understand this, even though the company does not have control over the action of the volunteer, they become vicariously liable, in the event they take the help of any volunteer for meeting the business needs.

Refer for more details

Pleading vicarious liability – Steps

Step 1 – File a claim against the employer for the acts committed by their employee

Step 2 – Provide necessary proof to confirm that the employee’s course of employment during committing the sin.

Step 3 – Substantiate with documents to prove employer negligence

Final thoughts

After going through all the details, you must have now come to the conclusion that behind every action someone is held vicariously liable. A parent for kids, employer for employees’ actions, etc. Therefore we warn you to take necessary preventive steps to avoid any mishaps.

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