THE LAW OF TORTS
Vicarious Liability
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Introduction: Personal Liability
 In tort law liability is generally personal; ie, liability is generally
linked to a breach of one’s (own) duty
 There are however instances where a party may be held liable for
torts committed by another: vicarious relationship
THE NATURE OF VICARIOUS
LIABILITY
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What is Vicarious Liability?
 Liability of D (usually the
master/employer) for the torts
of another (usually his or her
servant/employee) although
the master is without any
blame or fault.
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Distinctive Features
It is liability for the wrongful
act of another.
 It is a form of strict liability.
D may be liable without proof
of fault on D’s part
Types of Vicarious Relations:
Master Servant Situations
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Partnerships
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Principal and Agent Relations
•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
What are the factors
which create the
relationship of employer
and employee?
The Employer-Employee (MasterServant) Relations
 An employer is vicariously liable for the tortuous acts or
omissions by his employee in the course of employment
whether or not such act or omission was specifically
authorised by the employer.
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The Rationale for Vicarious Liability
 Respondeat superior: Traditionally, the common law viewed the
master as responsible for the servant’s conduct:
 "for seeing somebody must be a loser by (because of the conduct of
the employee), it is more reason that he that employs and puts a
trust and confidence in the (employee) should be a loser than a
stranger". Per Earl of Halsbury in Lloyd v Grace, Smith & Co
 Choice and training of employees: Liability tends to provide a spur
toward careful selection, training and supervision of employees;
 Benefits and the burden: Since the employer receives the benefits of
the activities of the enterprise, he should also bear its burdens;
 The ability to pay: Liability increases the likelihood of accident victims
receiving compensation
What is the difference
between a “contract of
service” and a “contract for
services” ?
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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; he /she 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 selects the servant for the task
SERVANTS AND
INDEPENDENT CONTRACTORS
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 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
 For the master/employer to be held liable, the
tortfeasor must:
 be a servant, and
 commit the tort in the course of his or her
employment
Independent Contractor Clauses
 Sample Clause:
 For the avoidance of doubt, this
Agreement and any engagement between
the parties shall not constitute a contract
for services. XXXXX shall be under no
obligation to offer or provide work to
XXXX, and XXXXXXXX shall be under no
obligation to agree to provide services to
XXXXXX outside the terms of this
Agreement.
Sample Clause
 XXXXXX hereby employs PPPP as an Independent Contractor, and
PPPP hereby accepts such employment
 As an Independent Contractor PPP shall provide on an "as
needed" basis the following services:…
 As an Independent Contractor PPPPPP may engage in other
business activities provided, however, that PPPPP shall not during
the term of this Agreement solicit XXXXXX’s employees or
accounts on behalf of the PPPPP or another entity
 PPP is an Independent Contractor and nothing contained in this
Agreement shall be deemed or interpreted to constitute the
Independent Contractor as a partner, agent or employee of XXXX,
nor shall either party have any authority to bind the other.
Substance versus Form/Label
 Note that while the agreement
between the parties and the label
they use to describe their
relationship may have some
evidentiary value, the courts
ultimately look at the substantive
elements of the relationship rather
than the label the parties use to
describe their agreement
Erini Hellen Panagis v Secretary, Department of
Social Security [1997] AATA 66
 [S]he perceived of her working relationship
as that of a sub-contractor, delivering pizza
at a certain price, working when and if she
chose, and carrying on a business. She has
an honestly and sincerely held belief that
she was carrying on a business, but this
belief does not change the relationship
which I regard as that of a casual
employee, into that of a person carrying
on a business
Some Substantive Elements in the
Relationship
 Control:




Hours of work
Place of work
Type of work
choice of workers
 Payment
 Public perception
 supply of
equipment
 the skills required
 Taxation, GST and
superannuation
issues
 Casual or
permanent
 whether employee
is permitted to
work for others
WHO IS A SERVANT?:
THE CONTROL TEST
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 In general, if the Master controls what the employee
does and how it is done, then the employee is
generally a servant. The relationship will give rise to
Vicarious Liability.
 The nature and extent of control will depend on the
nature of the work
Zuijis v Wirth Bros:
 The specialized nature of a job
does not necessarily imply that the
worker is an independent
contractors
 What is essential is not actual
control, but the right to control.
 Professionals may exercise their
own judgment and discretion on
how to perform their tasks
However, if the authority to
command remains in incidental or
peripheral matters such as hours of
duty then one is a servant
Stevens v Brodribb Sawmilling Company Pty
Ltd : The totality of the relationship
 Mason J:
 A prominent factor in
determining the nature of the
relationship between a person
who engages another to perform
work and the person so engaged
is the degree of control which
the former can exercise over the
latter. It has been held, however,
that the importance of control
lies not so much in its actual
exercise, although clearly that is
relevant, as in the right of the
employer to exercise .
 … The approach of this Court has been to
regard it merely as one of a number of
indicia which must be considered in the
determination of that question… Other
relevant matters include, but are not limited
to, the mode of remuneration, the provision
and maintenance of equipment, the
obligation to work, the hours of work and
provision for holidays, the deduction of
income tax and the delegation of work by the
putative employee
Wilson and Dawson JJ at [11]
The other indicia of the nature of the relationship have
been variously stated and have been added to from time to
time. Those suggesting a contract of service rather than
a contract for services include:
 the right to have a particular person do the work,
 the right to suspend or dismiss the person engaged,
 the right to the exclusive services of the person engaged
and
 the right to dictate the place of work, hours of work and
the like.
Wilson and Dawson JJ
 Those which indicate a contract for services include:
 work involving a profession, trade or distinct calling
on the part of the person engaged,
 the provision by him of his own place of work
 or of his own equipment,
 the creation by him of goodwill or saleable assets in
the course of his work,
 the payment by him from his remuneration of
business expenses of any significant proportion and
 the payment to him of remuneration without
deduction for income tax.
Wilson and Dawson JJ
 Having said that, we should point out that any attempt
to list the relevant matters, however incompletely,
may mislead because they can be no more than a guide
to the existence of the relationship of master and
servant. The ultimate question will always be
whether a person is acting as the servant of another
or on his own behalf and the answer to that question
may be indicated in ways which are not always the
same and which do not always have the same
significance
Hollis v Vabu Pty Ltd [2001]
 Riders wore uniform: "DRIVERS SHOULD
ALWAYS BE AWARE THAT THEY ARE A DIRECT
 Couriers were not providing
REPRESENTATION OF THE COMPANY. THEIR
skilled labour or labour which ATTITUDE AND APPEARANCE CAN ONLY BE
required special qualifications. SEEN AS A DIRECT REFLECTION OF OUR
ORGANISATION.”
 Deterrence: Holding the
employer vicariously liable for Vabu superintended the couriers' finances:
the wrongs of its employee may
encourage the employer to take
 This suggests that their engagement by
such steps, and hence, reduce Vabu left the couriers with limited scope
the risk of future harm.
for the pursuit of any real business
enterprise on their own account.
 Control: Vabu retained control
of the allocation and direction lthough a better employer may have born
of the various deliveries.
the cost of bikes and repairs, capital outlay
was small and bikes also provide means of
transport to get to and from work.
Per Windeyer J in Marshall v Whittaker's
Building Supply Co
 The distinction between an employee
and an independent contractor is
"rooted fundamentally in the
difference between a person who
serves his employer in his, the
employer's business, and a person who
carries on a trade or business of his
own"
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Borrowed Servants
 Instances of borrowed services:
 The general (ie regular) employer leases (out) a vehicle or equipment
such as crane, power shovel, bulldozer, truck etc with employee as
operator, to a party (special employer) who has a temporary need for such
machinery. Employee commits a torts by the negligent operation of
machinery
 The general employer as his business provides temporary workers to
other parties (special employers), sometimes simply as day laborers,
sometimes as skilled workers for specified periods of time.
 The general employer, by an agreement with the special employer assigns
the employee to work for the special employer for a specified period on
secondment or attachment etc
The Test in in the case of Borrowed
Servants
 The transfer or loan of an employee to the special
employer is not intended to terminate the
employee’s employment with the general employer.
 An employee is presumed to continue in the
employment of the general employer. P or the general
employee carries the burden of proof where there is
an allegation that the special employer has assumed
control and become the principal employer
 The test is control
 Mersey Docks & Harbour Board v Coggins &
Griffith
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WHEN DOES ONE ACT IN
THE ‘COURSE OF
EMPLOYMENT’?
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‘IN THE COURSE OF EMPLOYMENT’
 D is liable only if the servant committed the
tort in the course of his or her employment
 Whether the torts is committed in the course
of employment or not turns on:
 What tasks are authorized
 Whether the employee’s tortuous act are so
connected to authorized tasks that it can be
seen as a mode of carrying out the task
albeit wrongfully
Comcare v PVYW [2013] HCA 41
 Ms PVYW was sent to a country town by her employer to
conduct budget reviews and provide training. As she was
required to stay overnight, her employer booked her into
a hotel.
 Having finished work for the day and at a loose end, she
called a friend who lived in the town for dinner. After the
meal, they went back to her hotel room, where they also
had sex. A glass light fitting above the bed was pulled
from its mount, falling on Ms PVYW and injuring her nose
and mouth, sending her to the hospital.
 She then made a claim for workers' compensation.
The issues
 The question for the High Court was a simple one: Is an
injury (no matter what caused it) within the “course of
employment” if it occurs:
 during an interval or interlude within an overall period
or episode of work; and
 at a place the employer has induced or encouraged
the employee to spend that interval or interlude at;
and
 in circumstances where there is no disentitling
behaviour (such as gross misconduct or the injury being
self-inflicted)?
The Right Approach?
 determine if the employee suffered injury, but not while
engaged in actual work;
 if so, what was the employee doing when injured? (the employee
must have been either engaged in an activity or present at a
place when the injury occurred);
 how was the injury brought about?
 if it occurred at and by reference to the place (eg. a wall
collapses on an employee), the question is: did the employer
induce or encourage the employee to be there?
 when an activity was engaged in at the time of injury, the
question is: did the employer induce or encourage the employee
to engage in that activity?
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Acting in the course of employment
Criminal Act of Employee does not necessarily take conduct
outside the scope of employment.
Ffrench v Sestili: Sestili & Triton Underwriting Insurance
Agency [2007] SASC 241
 Theft of ATM funds held to be within scope of employment
 “The means to effect the fraud was ascertained …in the
course of her employment”
 Was “so closely connected with the duties of caring…” for
severely disabled victim.
 “Vulnerability of person being cared for…”
Torts Week 11
New South Wales v Lepore
 3 cases heard together of teachers employed by
school authority sexually abusing pupils.
 At issue: whether the intentional criminal
conduct of the servant comes within ‘scope of
employment’
 . An act of intentional, criminal wrongdoing,
solely for the benefit of the employee, may be
easy to characterise as an independent act;
but it is not necessarily so, and there are
many examples of cases where such conduct
has been found to be in the course of
employment.
Century Insurance Co Ltd v Northern
Ireland Road Transport Board
 Facts: the driver of a petrol truck was
transferring petrol from the truck to an
underground tank at a garage. While doing
this, he lit a cigarette and threw the lit
match onto the floor. The result was a fire
and the filling station burnt down.
 Held: The driver’s employers were held
vicariously liable as the act was done in the
course of his employment even though he
was not authorised to smoke while loading
tanks with petrol.
Phoenix Society Inc v Cavanagh
(1997)
 Facts: a drunken bus driver collided with a car and
injured the plaintiff who was driving the car. The bus
driver had been specifically warned by her employer not
to drink and drive.
 Held: The employer was nevertheless held to be liable
for her negligent act.
 Note: To be ‘during the course of employment’ and thus
render an employer liable, an employee must be
undertaking the negligent activity as part of their
employment, irrespective of whether the employee
has been specifically instructed by the employer not to
undertake the negligent behaviour.
Deatons Pty Ltd v Flew (1949) 79 CLR
370
 Facts: Mrs. Barlow was
a barmaid She claimed
P was drunk, insulted
her and slapped her.
She threw a glass of
beer at him and he
became blind in one
eye. P argued that
throwing beer was
incidental to her
employment.
Dixon J in Deatons Pty Ltd v
Flew
 In my opinion, however, it is clear that, upon the case
made for the plaintiff, a finding could not be supported
that the barmaid acted in the course of her employment
so that the defendant company would be vicariously
liable. For upon the plaintiff's case the assault was as
unexplained as it was unprovoked and might have
proceeded from private spite on the part of the barmaid
or from some other cause quite unconnected with her
occupation or employment.
 The truth is that it was an act of passion and resentment
done neither in furtherance of the master's interests nor
under his express or implied authority nor as an incident
to or in consequence of anything the barmaid was
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In the Course of Employment
Will the employer be liable for tort in contravention of the
prohibition?
An act in defiance of a prohibition which LIMITS THE SPHERE OF
EMPLOYMENT will be OUTSIDE the scope of employment - employer
not liable
 An act in defiance of a prohibition which deals with CONDUCT
WITHIN SPHERE (ie: how, when, where etc tasks are performed) OF
EMPLOYMENT will not be outside the scope of employment employer is liable
 A prohibition as to manner…time…or place …or as to the very act
itself…will not necessarily limit the sphere of employment
 To limit the sphere of employment the prohibition “ must be such
that its violation makes the servant’s conduct ..so distinctly remote
Torts Week 11
and disconnected from his employment…”
Employer prohibitions
 Bugge v Brown (1919)
 Facts: Worker was to be supplied with cooked meat at work but the
cook had left and the wife gave him meat and potatoes, sauce etc and
a frying pan to cook with. It was considered then necessary that he
eat meat. He went to cook it and a fire resulted with damage to the
neighbour’s land.
 Issue: whether the act of employee, in lighting the fire on 27th
December 1917 in McDonald's paddock for the purpose of cooking his
midday meal, was within "the course of his employment," or was an
act entirely outside the relation of master and servant, and therefore
to be regarded as the act of a stranger.
 Held: this was negligence but not a frolic of his own, it was within his
employment. While he lit the fire somewhere he was told not to was
not sufficient to remove liability of the employer.
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‘A Frolic of his/her Own’
 In general the employer is not liable where the employee commits a
torts while on a ‘frolic of his or her own’
 Harvey v O’Dell
 Detour to get more tools & lunch was in scope of
employment
 Not a frolic of their own bec. Employees were paid
subsistence money & not required to take lunch with them
 Petrou v Hatzigeorgiou: Horseplay / practical jokes by
employees may be within the course of employment
 out vicarious liab. of partner for tort of another partner
 Certain amount of horseplay conducive to maintaining good
staff relations
 Fact that act went outside permitted level of horseplay did
not take it outside the course of the business
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Non-delegable Duty Of Care
 A non-delegable duty of care is a personal duty to take
care: to ensure that care is taken.
 It cannot be delegated to another.
 The common "element in the relationship between the
parties which generates (the) special …duty to see that
care is taken is that the person on whom (the duty) is
imposed has undertaken the care, supervision or control
of …another … as to assume a particular responsibility
for his… safety" Kondis v. StateTransport Authority
(1984) 154 CLR at 687 per Mason J
Torts Week 11
Non Delegable Duty
A non-delegable duty is not a duty of care, rather it is a
duty to see that care is taken. The implication is that
steps may be taken by an employer to discharge a nondelegable duty and so intentional conduct of the
employee cannot be included when the employer is not at
fault.
 However, there are no steps that can be taken in
vicarious liability to prevent liability.
Intentional Conduct versus
Negligence in Non delegable duties
New South Wales v Lepore
 Gleeson CJ stated “The proposition that, because a
school authority's duty of care to a pupil is
nondelegable, the authority is liable for any injury...is
too broad, and the responsibility with which it fixes
school authorities is too demanding”.
 Gummow and Hayne JJ“all of the cases in which nondelegable duties have been considered in this court
have been cases in which the plaintiff has been injured
as a result of negligence...In the present
cases...[n]either plaintiff suffered injury as a result of
any negligent conduct of the teacher”
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Relationships which give rise to nondelegable duty:
 Hospital/patient – Ellis v Wallsend District Hospital
(1989) 17 NSWLR 553; Albrighton v RPAH [1980] 2
NSWLR 542
 School authority/student – Commonwealth v Introvigne
(1982) 150 CLR 258;
 Land occupier/danger to neighbour – Burnie v General
Jones Pty Ltd (1994)179 CLR 520
 Employer v Employee – Kondis v SRA (1984) 154 CLR
672.
Torts Week 11
CLA
 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.
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Non-delegable Duty Of Care
Civil Liability Act 2002 (NSW), s 5Q
A breach of a non-delegable duty is
to be determined as if it were
vicarious liability.
 Galea v Bagtrans Pty Ltd [2010] NSWCA 350
 S 5Q applied to make employer ‘vicariously
liable’ for the failure of another person to
exercise reasonable care where employer
owed a non-delegable duty of care. Per
Hodgson JA at [65].
Torts Week 11
 An employer owes a non-delegable
DOC to its employees to take
reasonable care to avoid exposing
them to unnecessary risks of injury. If
there is a real risk of injury then the
employer must devise a method of
operation to eliminate the risk.