TORTS - Lecture 11
Vicarious Liability
Negligence – Remedies (or
“Damages”)
Lecturer: Greg Young
greg.young@lawyer.com
VICARIOUS RELATIONS AND AGENCY
• An agent acts for the principal; but the liability of the
principal for the act of the agent is not based on
vicarious liability
• The liability of the principal is based on the maxim:
qui facit per alium, facit per se
• The agent acts in a representative capacity and has
the authority to act for the principal but is not
necessarily a servant
VICARIOUS LIABILITY
• Vicarious liability makes D (usually the
master/employer) liable for the torts of
another (usually his or her
servant/employee) although the master
is without any blame or fault.
SERVANTS AND
INDEPENDENT
CONTRACTORS
• Vicarious liability arises only in respect of the torts of
the servant
• The master/employer is therefore responsible only for
the torts of the servant and not the independent
contractor: Hollis –v- Vabu
• For the master/employer to be held liable, the
tortfeasor must:
– be a servant
– commit the tort in the course of his or her
employment
Non-delegable duties and vicarious
liability
Vicarious liability arises in circumstances “when the law
holds one person responsible for the misconduct of
another, although he is himself free from
blameworthiness or fault” (Fleming J, Law of Torts
(9th edition) at 409)
Non-delegable duty arises in circumstances where a
person cannot be excused from liability even if
reasonable care is exercised in entrusting
responsibility to another person
Civil Liability Act:
Non-delegable duties and vicarious liability
5Q Liability based on non-delegable duty
(1) The extent of liability in tort of a person ("the defendant")
for breach of a non-delegable duty to ensure that
reasonable care is taken by a person in the carrying out of
any work or task delegated or otherwise entrusted to the
person by the defendant is to be determined as if the
liability were the vicarious liability of the defendant for the
negligence of the person in connection with the
performance of the work or task.
(2) This section applies to an action in tort whether or not it is
an action in negligence, despite anything to the contrary in
section 5A.
Non-delegable duties and Vicarious duties
• New South Wales v Lepore ; Samin v Queensland; Rich v
Queensland [2003] HCA 4 (6 February 2003)
- Liability of school authority
- Alleged sexual assault on pupil by teacher
- Whether school authority in breach of non-delegable duty of care
- Concept of non-delegable duty
- Whether school authority vicariously liable
- Test for imposition of vicarious liability.
WHO IS A SERVANT?
• A servant is one who is under a contract of service to
another an independent contractor is under a contract
for services
• The contractor is paid for the job by results rather than
for time spent, receives a fee or commission, the
servant receives wages
• The contractor is usually employed on a casual basis, the
servant on a permanent basis
• The contractor usually specifies his/her work schedule
and supplies his/her own tools
• The master may select the servant for the task
WHO IS A SERVANT?:
THE CONTROL TEST
• If the Master controls what the employee does and how
it is done, then the employee is a servant. The
relationship will give rise to Vicarious Liability.
• Zuijs v Wirth Bros: The case of the trapeze artist
• What is essential is whether there is lawful authority to
command or give directives if there is scope for it.
• Stevens v Brodribb Sawmilling
‘IN THE COURSE OF EMPLOYMENT’
• D is liable only if the servant committed the
tort in the course of his or her employment
– Deaton v Flew
– Morris v Martin
Negligence – Remedies (or
“Damages”)
RECOVERABLE HEADS OF LOSS:
PERSONAL INJURY
• Windeyer J in: Teubner v Humble (1963) 108 CLR 491
(P was
head photographer for Adelaide newspaper “The News”; 12/5/60 a violent storm occurred and P sent to take photos; P
took a taxi & told the driver to stop near the Hindmarsh Bridge so he could take photos of a sheet of water and the
effect on cars/traffic; after ¼ hr P was returning to the taxi when the D’s car struck him)
– Three ways in which personal injury can give rise to damages:
• destruction or reduction (of existing mental or physical capacity)
• new needs (which did not exist prior to the injury)
• production of pain (and suffering)
• These categories include:
– loss of earning capacity
– the cost of medical and nursing care (past and future)
– physical pain
– mental anguish
DAMAGES: PERSONAL INJURY
• SPECIAL DAMAGES
– out of pocket expenses
– loss of income up to the
date of verdict less any
deductions* (This may be
included in loss of earning
capacity)
• GENERAL DAMAGES
– future medical and hospital
expenses
– future economic loss
– loss of amenities and
enjoyment of life
– Pain and suffering
– loss of expectation of life
OUT-OF-POCKET EXPENSES
• In general this includes all expenses incurred by
the plaintiff on account of the breach up to the
date of verdict (Paff v Speed (1961) 105 CLR 549,
558-9)
– medical expenses
– surgical fees
– Transportation
– Special needs etc
LOSS OF INCOME
• [See ss.12 & 14 Civil Liability Act]
• Loss of past & future superannuation
• Nett loss of pay plus overtime:
– less any savings to be made as a result of the injury (eg cost
of transport to work)
– less any boarding and lodging savings eg for being in
hospital (Sharman v Evans (1977) 138 CLR 563
– less allowance for income tax deductions (Cullen v Trappell
(1980) 146 CLR 1)
FUTURE (HOSPITAL AND
MEDICAL/CARE) EXPENSES
• P is entitled to recover the future cost of hospital,
medical, nursing and home care.
• P is entitled to recovery of such cost even where
the care (nursing/home care) is provided
gratuitously by a spouse or relative Griffiths v
Kerkemeyer (1977) 139 CLR 161
• The damages for such expenses are calculated by
reference to the market cost of the services
LOSS OF EARNING CAPACITY
• The onus is on P to provide evidence of real possibility of
the potential/capacity yet unexploited that would have
been exploited in the future but for the injury suffered
(Mann v Ellborn (1973) 8 SASR 298 ( police officer who
was aspiring to be a lawyer)
• Where D maintains that P retains the capacity to earn,
the onus is on D to provide the relevant evidence and
the range of work open to P
NON-ECONOMIC LOSS
• Non-economic loss is traditionally claimed under
three main heads of damage:
– Pain and suffering
– loss of amenities
– loss of expectation of life
• "is not the prospect of length of days, but the prospect of a
predominantly happy life . . . The ups and downs of life, its
pains and sorrows as well as its joys and pleasures . . . have
to be allowed for in the estimate" Benham v. Gambling
(1941) AC 157: (p 166 )
ASSESSMENT OF NON-ECONOMIC
LOSS
• There is no acceptable criteria for assessing what is fair compensation
for a particular non-economic loss
• (Sharman v Evans – P at age 20 yrs became a quad due to MVA; lost power of speech,
ltd use of arms, developed epilepsy...):
– Her ability to breathe, eat, speak, move, control her excretions,
have social and sexual intercourse, bear or look after children is
either greatly impaired or destroyed. She also went through the
ordeal of releasing the young man from his promise to marry
her…The estimate in respect of pain and suffering is seldom
adequate( Murphy J)
– She has suffered and will continue to suffer for the rest of her
life in her left shoulder, another of her few remaining sensory
areas…Pain and suffering and loss of amenities of life is a head
of damages which is particularly difficult to assess (Gibbs and
Stephen JJ)
Civil Liability Act 2002
Part 2 Personal Injury Damages
• Received assent on 18 June 2002
• Section 11A:
(1) does not apply to claims excluded by Section
3B (eg. Damages for dust diseases, use of
tobacco products, workers’ compensation…)
(2) Part 2 applies regardless of whether the claim
is brought in tort, contract, statute or otherwise
(3) A court cannot award damages, or interest on
damages, contrary to Part 2.
Civil Liability Act 2002
• Pt 2 Non-economic loss:
- No damages for non-economic loss unless assessed at 15% of
a most extreme case (eg. 15% = 1% or $3,500, 16% = 1.5% or
$5,250, …26% = 8% or $28,000, …33% = $115,500…100% =
$350,000): Section 16(1) & (3)
- Maximum non-economic loss = $350,000: Section 16(2)
- Maximum for non-economic loss indexed: Section 17
- Courts/parties may refer to other awards of non-economic
loss in earlier court decisions: Section 17A
Civil Liability Act 2002
Exemplary, punitive & aggravated damages:
•
A court cannot award exemplary, punitive or
aggravated damages in an action for
personal injury resulting from negligence :
s21
Civil Liability Act 2002
•
-
Pre-judgment Interest:
No interest payable on damages for non-economic
loss or gratuitous attendant care: s18(1)
If interest is awarded (eg. Past economic loss), the
“relevant interest rate” is the Commonwealth Govt
10-year benchmark bond rate: s18(4)
Civil Liability Act 2002
• Economic Loss:
- Maximum for gross loss loss of earnings = 3 times
average weekly earnings: s12
- 5% actuarial tables for future economic loss: s14
• Gratuitous Attendant Care:
- No damages awarded if services provided:
(a) for less than 6 hours per week, and
(b) for less than 6 months: s15(3)
Geaghan v D’Aubert [2002] NSWCA 260
Harrison v Melhem [2008] NSWCA 67
Negligence - Remedies
INJURY TO RELATIONAL INTERESTS
THE SCOPE OF THE ACTIONS
Death
Dependents may sue for loss
actual or expected benefits
Loss of services
Parent/master may sue for
wrongful deprivation of the
Services of a child/servant
Loss of consortium
An action that permitted
the husband to sue
for wrongful deprivation of the
wife’s consortium
COMMON LAW AND THE SURVIVAL OF
ACTIONS
• In the event of death from a wrongful act there
are two potential defendants:
– the estate; and
– dependants
• Traditionally in Common Law, a personal action
‘died’ with the victim
The Estate: Lord Campbell’s Act (1846)
• The Act modified the Common Law rule in
England.
– The effect of the legislation was to give to the
estate the action which the deceased would have
had she or he survived
• Australian States and Territories have adopted
similar statutes with modifications
SURVIVAL OF ACTIONS: NSW
• Law Reform (Miscellaneous Provisions) Act (NSW)
1944 Part 2 Survival of causes of Action After Death
– Subject to the provisions of this section, on death of any
person …all causes of action subsisting against or vested in
him shall survive against, or, as the case may be, for the
benefit of, his estate;...
QUALIFICATIONS
• Section 2(2) of the Law Reform (Miscellaneous
Provisions) Act (NSW) 1944 does not allow for recovery
of the following types of damages:
–
–
–
–
exemplary damages
loss of earning capacity/loss of future probable earnings
loss of expectation of life
pain and suffering
• Incidental losses or gains except for funeral expenses
will not affect the quantum of damages
HEADS OF DAMAGES
• ALLOWABLE DAMAGES
– Needs created; reasonable
expenses incurred before
death
– Reasonable funeral
expenses
• NON-ALLOWABLE
– loss of earning capacity
– Non-economic loss
DEPENDENTS’ CLAIMS
• Compensation to Relatives Act 1897 (NSW)
– 3(1) Whenever the death of a person is caused by a
wrongful act, neglect, or default, and the act , neglect or
default is such as would ( if death had not ensued) have
entitled the party injured to maintain an action and
recover damages in respect thereof , then and in every
such case the person who would have been liable if
death had not ensued shall be liable to an action for
damages
PLAINTIFF: STANDING
• Compensation to Relatives Act 1897 (NSW) S4:
– spouses
– parents (including those in loco parentis)
– de factos Compensation to Relatives Act (De facto
Relationships )Amendment Act 1984
– children (including step children)
– siblings (half and full)
SCOPE OF LOSS
• Public Trustee v Zoanetti (1945) 70 CLR 266 (Zoanetti
unlawfully killed by Reid (deceased); Public Trustee was executor of Reid’s will; action
taken by Zoanetti’s widow against Pub Trustee as legal personal representative of Reid)
– ‘The basis for the action is not what has been called
solatium, that is to say, damages given for injured
feelings or on the ground of sentiment, but damages
based on compensation for pecuniary loss’
– What must be ascertained is whether any and what
loss has been sustained by the relatives of the
deceased … (Dixon J , 279)
HEADS OF DAMAGES
• Loss of economic support/loss of reasonable
expectation of financial benefit
[see Luntz on Damages for a formula used to
assess loss of economic support]
• Loss of domestic services
LOSS OF REASONABLE EXPECTATION OF
FINANCIAL BENEFIT
• The benefit is a ‘chance’ that is lost. P must therefore
establish such ‘chance’ in accordance with the principles of
reasonable certainty. (Taff Vale Railway Co v Jenkins
(1913)AC 1, 7
– All that is necessary is that a reasonable expectation of pecuniary
benefit should be entertained by the person who sues. It is quite
true that the existence of this expectation is an inference of fact
from which the inference can be reasonably drawn...
• It may be immaterial that the deceased was unemployed
prior to his/her death
• In the case of a young child, there has to be evidence
sufficient to establish the potential to provide the benefit
(McDonald v Hillier [1967] WAR 65)
• In circumstances where maintenance obligations are
transferred to a third party this may not necessarily preclude
a claim because of future contingencies (Thomson v
Mandler [1976] 2 NSWLR 307
DOMESTIC SERVICES
• Nguyen v Nguyen (1990) CLR 245 (Deceased wife/mother killed due to D’s
neg driving; Ps were husband & 2 children; inter alia, claim for lost housekeeping etc.)
– The claim: ‘loss of the deceased’s domestic capacity being the
value of services such as child care, cooking, washing, ironing and
cleaning’
• The definition of ‘services’ is broad:
– ‘There is no reason why ‘services’ in this context should be given
an unduly narrow construction, as if a wife is no more than a
house keeper’ Per Dawson, Toohey and McHugh JJ in Nguyen v
Nguyen)
– Where the services are likely to to be replaced as a result of
remarriage, the reasonable prospect of that remarriage will serve
to reduce the compensation to which the plaintiff will be entitled
… because the P’s loss is thereby directly reduced ( Per Dawson,
Toohey and McHugh JJ in Nguyen v Nguyen)
LOSS OF CONSORTIUM
• The traditional common position permitted a husband to
maintain an action under three heads for loss of
consortium (actio per quod consortium amisit)
– Loss of the wife’s company including sexual companionship
– Loss of her domestic services
– Medical and other expenses incurred as a result of the injury to
the wife
• In Qld & SA the action is available to both spouses; in NSW,
Tas and WA, the action has been abolished
LOSS OF SERVICES
• Traditionally the common law allowed a cause of
action (actio per quod servitium amisit) for the loss
of services of:
– Children
– Servants
• While the action for loss of services in the case of the
child is rare today, action for loss of services from a
servant remain a feature of the common law
LOSS OF SERVICES: SERVANTS
• The action was traditionally restricted to menial services
offered by the servant. In Australia there is no restriction
based on the types of services as such
• Heads of damage:
– Loss of profits
– Payment to the servant of sick-pay or pension
– Out of pocket expenses such as Workers Comp or medical
expenses.
• The Motor Accidents Comp. Act 1999 excludes
compensation for loss of services s 142
• The Employees Liability Act 1991 excludes against
employees by employers
• P cannot claim for the death of a servant (Sawn v Williams)
Cattanach v Melchior [2003] HCA 38 (16
July 2003)
Facts
• Dec ’67 – Mrs M underwent an appendectomy at
Balmain Hospital, Sydney as a 15 year old. Her right
ovary was filled with a blood clot and removed.
However, her left and right fallopian tubes were
unaffected.
• 1984 – Mr & Mrs M married
• 1985 & 88 – Two daughters were born
• Nov ’91- Mrs M 1st saw Dr C (gynaecologist), who
formed the view that the right ovary and fallopian
tube were removed in 1967
Cattanach v Melchior [2003] HCA 38 (16
July 2003)
Facts
• Mar ‘92 – Dr C performed a laparoscopic tubal ligation at
Redland Hospital, Brisbane. He found “…No right tube or
ovary visible. Consistent with patient’s history of right
salpingo-oophorectomy...”
- In fact, the right fallopian tube was obscured by bowel
adhesions so only the left fallopian tube was clipped.
- Dr C did not see Mrs M again.
• Nov ’96 – Mrs M fell pregnant at age 44 years.
• May ‘97 – Healthy son, Jordan, was born
- Experts representatives of the parties were present at the
birth and found the right fallopian tube was present
Cattanach v Melchior [2003] HCA 38 (16
July 2003)
Facts
• Sept ‘97 – Mrs M underwent an hysterosalpingogram, a
procedure in which dye is inserted into the uterus and the
results are observed on x-ray.
- The results showed the right fallopian tube was patent.
- Consensus of medical opinion was that conception occurred
as an ovum transmigrated from the left ovary to the right
fallopian tube
• Trial judge (Holmes J) found Dr C was negligent in failing to
adequately inform Mrs M of the possibility that the procedure
would fail so as to give her the option of considering further
investigation by way of hysterosalpingogram
Trial Judge’s Award (unchallenged on appeal)
Mrs M’s Damages:
Pain & Suffering and loss of amenities
$30,000.00
Interest on $20,000 for 3.5 yrs @ 2%
1,500.00
Past eco loss
3,003.00
Interest for 3.5 yrs @ 5%
525.52
Future eco loss
10,000.00
Past Griffiths v Kerkemeyer
13,300.00
Interest for 3 yrs @ 2%
851.12
Future G v K
28,476.00
Past special damages
15,473.06
Interest on special damages
543.69
$103,672.39
Trial Judge’s Award (unchallenged on appeal)
Mr M’s Damages:
At paragraph 15, Gleeson CJ noted that Holmes J applied the “blessing argument” to
reduce the claim for loss of consortium but no reduction was made for the subject of
the appeal.
Loss of consortium (not available in
NSW)
$3,000.00
$3,000.00
Trial Judge’s Award (subject of appeal)
Mrs & Mr M’s Damages:
At paragraph 20, Gleeson CJ noted Holmes J accepted a schedule prepared by Mr M setting out
past and anticipated costs of raising Jordan to age 18 years. “For the eary years, about half of the
estimated expenditure was on food. In the later years, that proportion dropped to about one
third. Other items included clothing, medical and pharmaceutical expenses, child care, travelling
to and from school, birthday and Christmas presents each year, and entertainment... It included
items of reasonable discretionary expenditure...”
All Justices of the High Court considered the sums claimed by Mr M were relatively low but
Hayne and Heydon JJ in separate judgments posed the question at paragraphs 208 and 306
respectively whether the wealthy should awarded higher compensation.
Past cost of raising Jordan
Interest for 3 yrs @ 5%
Future costs of raising Jordan to age 18
yrs
$17,698.80
2,655.00
84,895.53
$105,249.33
Cattanach v Melchior [2003] HCA 38 (16
July 2003)
Appeal – Limited to the costs of raising and maintaining
Jordan
• Qld Court of Appeal – Dr C’s appeal dismissed
(McMurdo P and Davies JA, Thomas JA dissenting)
• High Court of Australia – Dr C’s appeal dismissed
(majority of McHugh & Gummow JJ, Kirby J and
Callinan J, with Gleeson CJ, Hayne J and Heydon J
dissenting)
Cattanach v Melchior [2003] HCA 38 (16
July 2003)
High Court – Summary of dissenting views
• Gleeson CJ – claim involves moral, natural and legal obligations so there is no clear
reason why such a claim should cease at 18 years
- [para 38] “…It is a human relationship, regarded by domestic law and by international standards
as fundamental to society. To seek to assign an economic value to the relationship, either positive or
negative, in the ordinary case, is neither reasonable nor possible. ”
• Hayne J – [para 258] “...what is seen to be the desirable paradigm of family relationships in
which the child and parent are of mutual support of each other. In that sense, and only in that sense, the
law might be seen as concluding that every child is a blessing.”
- [para 261] “...the law should not permit the commodification of the child...”
• Heydon J – [para 356] “Human life is invaluable in the sense that it is incapable of
valuation. It has no financial worth which is capable of estimation... To calculate them in money terms and
then permit their recovery in relation to the performance of the duty is to engage in an activity lacking any
meaningful correspondence with the duty...”
Cattanach v Melchior [2003] HCA 38 (16
July 2003)
High Court – Summary of dissenting views
• Gleeson CJ – claim involves moral, natural and legal obligations so there is no clear
reason why such a claim should cease at 18 years
- [para 38] “…It is a human relationship, regarded by domestic law and by international standards
as fundamental to society. To seek to assign an economic value to the relationship, either positive or
negative, in the ordinary case, is neither reasonable nor possible. ”
• Hayne J – [para 258] “...what is seen to be the desirable paradigm of family relationships in
which the child and parent are of mutual support of each other. In that sense, and only in that sense, the
law might be seen as concluding that every child is a blessing.”
- [para 261] “...the law should not permit the commodification of the child...”
• Heydon J – [para 356] “Human life is invaluable in the sense that it is incapable of
valuation. It has no financial worth which is capable of estimation... To calculate them in money terms and
then permit their recovery in relation to the performance of the duty is to engage in an activity lacking any
meaningful correspondence with the duty...”
Cattanach v Melchior [2003] HCA 38 (16
July 2003)
High Court – Summary of the majority
• McHugh & Gummow JJ – [para 68] “The unplanned child is not the harm for
which recompense is sought…it is the burden of the legal and moral responsibilities which
arise by reason of the birth of the child that is in contention… What was wrongful in this case
was not the birth of the third child to Mr & Mrs M but the negligence of Dr C. ”
Kirby J – [para 144] “...for a very long time judges and juries have been obliged to
put money values on equally nebulous items such as pain and suffering and loss of
reputation. Calculation of the cost of rearing a child is, by comparison, relatively
straightforward.”
- [para 145] “The notion that a child might be hurt emotionally following the later
discovery that parents had sought sterilisation and had gone to court... Is unconvincing... In
the real world, cases of this kind are about who must bear the economic costs of the upkeep
of the child. Money, not love or the preservation of the family unit, is what is in issue.”
Callinan J – [para 295] “One strong contrary argument against the appellants
which I accept, is that a holding for them here would be tantamount to the conferral of a new
form of immunity upon doctors and hospital authorities.”
CIVIL LIABILITY AMENDMENT ACT 2003
Part 11 - Damages for the birth of a child
Section 70 Application of Part
(1) This Part applies to any claim for damages in civil proceedings
for the birth of a child, regardless of whether that claim is
made in tort, in contract, under statute or otherwise.
(2) This Part does not apply to any claim for damages by a child
in civil proceedings for personal injury (within the meaning of
Part 1A) sustained by the child pre-natally or during birth.
(3) This Part does not apply to civil liability that is excluded from
the operation of this Part by section 3B but, despite that
section, does apply to liability of the kind referred to in
section 3B (1) (a).
CIVIL LIABILITY AMENDMENT ACT 2003
• 71 Limitation of the award of damages for the birth of a child
(1) In any proceedings involving a claim for the birth of a child to
which this Part applies, the court cannot award damages for
economic loss for:
(a) the costs associated with rearing or maintaining the child
that the claimant has incurred or will incur in the future, or
(b) any loss of earnings by the claimant while the claimant
rears or maintains the child.
(2) Subsection (1) (a) does not preclude the recovery of any
additional costs associated with rearing or maintaining a child
who suffers from a disability that arise by reason of the
disability.