High Court affirms vicarious liability is limited to an employment relationship

A High Court decision in a sexual abuse case against the Catholic Church has affirmed institutions are only vicariously liable for the acts or omissions of its employees.

In Bird v DP, The Plaintiff (DP) alleged he was sexually abused on two occasions by the now deceased Father Bryan Coffey (Coffey).

The abuse is alleged to have been perpetrated during pastoral visits by Coffey to the home of DP’s parents in 1971, at which time Coffey was an assistant parish priest not directly employed by the Diocese of Ballarat (Diocese).

DP commenced proceedings against the Diocese through its nominated defendant, the current Bishop of the Diocese, Paul Bird claiming damages for psychological injuries alleged to have been caused by Coffey.

DP claimed the Diocese was vicariously liable for Coffey's assaults notwithstanding the lack of a clear employment relationship between the Diocese and Coffey, and that the Diocese was negligent for not properly supervising and controlling Coffey.

At first instance, the Supreme Court of Victoria (Forrest J) held the Diocese was vicariously liable for Coffey's conduct because the relationship between the Diocese and Coffey was akin to an employment relationship.  Forrest J held the Plaintiff had not established the Diocese was negligent.

On appeal, the Victorian Court of Appeal found the primary judge was correct in concluding Coffey's abuse occurred in circumstances rendering the Diocese vicariously liable.

Issue

The appeal to the High Court considered:

1. Whether the relationship between Coffey and the Diocese, being "akin to employment", was one that should give rise to vicarious liability;
2. If it was found vicarious liability should extend to relationships "akin to employment", was the Diocese liable for Coffey's abuse of DP; and
3. Whether DP's allegation, not raised at trial or on appeal, but in a filed Notice of Contention, the Diocese breached a non-delegable duty of care it owed him to protect him from the risk of sexual abuse by its priests such as Coffey should be considered.

Held

The High Court unanimously allowed the appeal and ordered the Orders made by Forrest J be set aside, and for the proceeding to be dismissed with costs.

Vicarious Liability

The joint judgement of Gageler CJ, Gordon, Edelman, Steward and Beech-Jones JJ found:

1. Vicarious liability only applies to employment relationships, consistent with previous High Court rulings that have refused to extend vicarious liability beyond such relationships.
2. As Coffey was not an employee of the Diocese, there was no finding of vicarious liability on the part of the Diocese.  
3. It is insufficient Coffey and the Diocese had or may have had a relationship "akin to employment", as expanding the threshold requirement for vicarious liability to include relationships "akin to employment" would create uncertainty and indeterminacy in that:
   • It would lead to the expansion of liability to relationships that have not traditionally been understood to involve one party being liable for another's wrongs; and
   • It would further complicate the distinction between employees and independent contractors.¹
4. "In Australia, an employer may be liable for the acts of its employees, but there is no vicarious liability, in the sense it is now being discussed, for the acts of those not in a relationship of employment, namely acts of third parties outside of that context."²
5. "A relationship of employment has always been a necessary precursor in this country to a finding of vicarious liability and it has always been necessary that the wrongful acts must be committed in the course or scope of the employment.  There is no solid foundation for expansion of the doctrine or for its bounds to be redrawn".
6. There are, of course, some exceptions to this;³ however such exceptions generally turn on the unique facts of specific cases.

Jagot J clearly rejected the submission the principles of vicarious liability should be extended, largely for two reasons:

1. An extension would need to confront the reasoning in previous decisions such as Hollis v Vabu Pty Ltd, Scott v Davis and Sweeney v Boylan Nominees Pty Ltd, which stand firmly against extension, as this would increase confusion regarding the classification of employees and independent contractors, which could result in indeterminacy and incoherence in the law.
2. The Victorian Parliament's legislative reforms in response to the Royal Commission into Institutional Responses to Child Sexual Abuse largely "weigh against any expansion of the common law doctrine of vicarious liability"⁴, with the Legal Identity of Defendants (Organisational Child Abuse) Act held to not remedy the fact the Diocese could not and did not employ Coffey by reason of its existence as an unincorporated association without legal personhood.

In dissent, Gleeson J agreed with the majority's orders, but via a different reasoning, finding although the relationship between the Diocese and Coffey was one capable of attracting vicarious liability, the circumstances in which the abuse occurred, being that Coffey took advantage of his role to commit the abuse, could not be said to be in the course of Coffey's role as assistant parish priest.

Non-delegable duty

The Court unanimously declined to consider whether the Diocese owed a non-delegable duty of care to DP.  As this contention was not raised before the appeal, the Court held consideration of the issue would irremediably prejudice the Diocese.

The Court recognised such a duty has previously arisen out of relationships of employer and employee, school and pupil; hospital and patient "where the nature of the relationship between the defendant and the other person to whom the duty is owed is one where the defendant has assumed particular responsibility to ensure that care is taken, rather than merely to take reasonable care." ⁵

The Court noted, whilst the issue of a personal or non-delegable duty was not entertained in the current case, as it may have prejudiced the Appellant given it should have been raised at trial (among other factors), future claimants may seek to raise this argument at the initial stages of trial given its relevance in similar abuse cases is yet to be determined.

However, the Court acknowledged the recent Royal Commission into Institutional Responses to Child Sexual Abuse may raise issues in presenting such an argument, given it had specifically recommended the recent addition of a statutory duty of care apply prospectively, and not retrospectively.⁶

Impact

The High Court has emphatically stated an employment relationship is a prerequisite to a finding of vicarious liability, and it is insufficient to merely have  a relationship “akin to employment” as seen in other jurisdictions.  This limits plaintiffs' ability to bring claims against institutions for the acts or omissions of others absent an employment relationship.

Whilst the High Court has not determined whether an institution such as the Diocese may owe a personal or non-delegable duty of care, the clear indication is the Court is unlikely to establish a new non-delegable duty of care retrospectively given the legislative establishment of a statutory duty of care with a reversed onus of proof prospectively from July 2017.

Notes

¹ See [65] – [66].

² [46].

³ See generally Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41 ('Colonial Mutual Life').

⁴ [247].

⁵ [37].

⁶ Australia, Royal Commission into Institutional Responses to Child Sexual Abuse, Redress and Civil Litigation Report (2015), Ch 15.6, particularly recommendations 89-93 at 495.

Authors

Cameron Roberts | Partner | +61 3 9641 8696 | croberts@tglaw.com.au

Hannah Sowdon | Partner | +61 3 9641 8840 | hsowdon@tglaw.com.au

Nicholas Presta | Law Clerk

‍