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Hawley v Luminar Leisure, 24 January 2006

31 January 2006
The issues

Bouncer – Vicarious Liability – Whether Doorman Temporary Employee Of A Nightclub – Whether Supplier Of Doorman Liable For A Contribution

The facts

Luminar owned some 300 entertainment venues under different brands. One brand was “Chicago Rock Caf»” and one such club was in Southend on Sea. The Second Defendant, ASE Security Services Limited provided security services included door supervisors to the Chicago Rock Caf» in Southend. On 18th August 2000 the Claimant visited the club together with a number of friends including a Mr Playfair. The club closed at 1 am and at about 1.30 am CCTV footage showed a “melee” involving a number of customers at the club who had just left. Three door stewards had gone out to try and calm the situation down. At one point the Claimant was seen on the footage being approached and engaged in a conversation with one of the door stewards. He is seen to raise his hand and walk back in a gesture indicating he did not wish to have any trouble with the steward. At that point however another steward came on to the scene and punched the Claimant very hard on the right jaw causing him to fall to the ground and knock his head against the pavement. As a result he suffered fractures of the skull, nose and jaw and suffered severe brain injury. It was common ground that the second steward, Mr Warren was an employee of ASE. He was prosecuted for assault and convicted of inflicting grievous bodily harm and sentenced to two years imprisonment and suspended for two years. The Claimant brought an action against Luminar and ASE alleging that each of them was liable for Mr Warren’s acts.

ASE was put into voluntary winding up in May 2002 and did not file a Defence when proceedings were commenced as a result of which a default Judgment was entered against them. Luminar issued a Part 20 Notice of Contribution/Indemnity against ASE and a subsequent order was made that if the Claimant could prove that he was struck in the face by Mr Warren and that Mr Warren was acting in the course of his employment when he struck the Claimant, then ASE was liable to indemnify Luminar pursuant to the contract between them. In the end neither issue was in contention and therefore ASE were liable under that Order to Luminar. At directions stage the Master had given leave to Faraday Underwriting Limited the nominated underwriter of ASE, to be joined as the Third Defendant. It reserved its right to deny that it was liable to indemnify the Second Defendant in respect of any liability it might have. In February 2004 an amended Particulars of Claim was served in which the Claimant alleged that Luminar was a temporary deemed employer of Mr Warren for the purposes of vicarious liability in tort.

The amendment also sought in the light of the voluntary winding up of ASE to claim that the Claimant stood in Luminar’s shoes pursuant to Section 1 (1) of The Third Parties (Rights Against Insurers) Act 1930 so as to take advantage of the insurance policy between ASE and Faraday. Finally the amended pleading sought a declaration that the Third Defendant would be liable pursuant to the 1930 Act to pay any damages and costs that the Claimant was awarded against the Second Defendant. Luminar argued in turn that Mr Warren was neither an employee nor a temporary deemed employee of Luminar at the material time and therefore denied any vicarious or any other liability in respect of the acts of Mr Warren. The Third Defendant denied that it was liable to ASE for damages arising from “accidental bodily injury” within the meaning of its policy with ASE alleging that the liability arose from an intentional assault and as such would not fall within the ambit of the cover. Moreover it took the point that ASE was not entitled to an indemnity since it was caused by and arose from a deliberate, wrongful and criminal act.

The matter came before the Judge on liability only and Luminar abandoned its argument that Mr Warren was not acting in the course of his employment when he assaulted the Claimant and the Claimant abandoned its argument that Luminar was liable on the basis of direct negligence. The Third Defendant abandoned its argument that ASE was not entitled to an indemnity because the liability arose from a deliberate wrongful and criminal act. The remaining issues were therefore:-

1. Was Mr Warren a temporary deemed employer of Luminar such as to fix them with vicarious liability.
2. Was the liability attaching to ASE to be regarded as a liability for accidental bodily injury within the meaning of its policy.
The Judge found that Luminar were vicariously liable finding on the facts that they had sufficient control over ASE’s employees so as to make them “temporary deemed employees” of Luminar. He also found that the injury was “accidental” within the meaning of the policy notwithstanding the finding that Mr Warren had deliberately punched the Claimant and granted a declaration that the insurers were liable to indemnify ASE for any damages and costs awarded to the Claimant against ASE and to pay the Claimant pursuant to Section 1(1) of the Third Party’s (Rights Against insurers) Act 1930 any such damages and costs. He assessed Luminar’s claim against ASE for a contribution at nil.

Luminar appealed.

The decision

1. The issue of vicarious liability against Luminar.
There was sufficient evidence before the Judge below to justify his conclusion that Luminar were deemed to be Mr Warren’s temporary employer for the purposes of vicarious liability. He had gone through the evidence carefully and the decision he came to was one he was fully entitled to reach and one which the Court of Appeal would not interfere. The Judge had borne in mind that ASE employed, paid and had the power to dismiss Mr Warren. But he found that Luminar if not the general employer in law acted as if they were in fact and exercised many of the powers of the general employer. They exercised detailed control not only over what the Door Stewards did but how they were to do it.

2. The issue regarding dual vicarious liability.
There was effectively and substantially a transfer of control and responsibility for ASE to Luminar. The facts of the case were very different from that in Viasystems Ltd v Thermal Transfers (Northern) Ltd. The issue of who was entitled to control the employee’s relevant negligent act was still at the heart of the test. The answer to the question of who was entitled and obliged to control Mr Warren’s act was Luminar. ASE had no immediate or effective control over the activities of Mr Warren. No finding of dual vicarious liability could be made. In any event, the nil contribution was not an end of the matter because Luminar were owed the full contractual indemnity by ASE.

3. The issue of whether ASE should make contribution to Luminar.
The fact that a party liable vicariously for the wrongful act of his employee is not himself at fault is not relevant for the purposes of determining contribution proceedings between that person and another wrong doer. Luminar had to stand in the shoes of their deemed employee and the Judge was obliged to assess the responsibility for the fateful blow as between Warren and ASE his general employer. ASE’s “fault” was in not making proper enquiries at the time they employed Mr Warren. That was far removed from the incident itself however. During the two year period that Mr Warrener had worked at the Club under Luminar’s direction nothing had occurred to alert ASE to any proclivity he might have to unprovoked violence. As between Mr Warrener and ASE the blame lay fairly and squarely at Mr Warren’s door. It was open to the Judge therefore to find as between the Defendants that ASE’s negligence had a negligible causative effect.

4. Whether the injury to Mr Horley amounted to “accidental bodily injury” for the purposes of the policy.
The issue that the Judge had to determine was whether the bodily injury caused to the Claimant was “accidental” within the meaning of the Schedule to the combined liability insurance policy entered into between ASE and the Underwriters. There were a number of factors which taken together persuaded the Court that the Judge had been correct in his conclusion. Firstly, the policy was one of insurance in respect of Security Guards including Door Supervisors. It was concerned with protecting ASE against liability arising from the actions of their Security Guards. It was said with force that one would not expect the Underwriters to be able to invoke ASE’s vicarious liability for its Doormen as a ground for avoiding as opposed to accepting liability under the policy.

5. Authority suggested that the question of accident (or fortuity) in connection with issues such as these was normally judged by reference to the state of mind of the assured. In this case, from the perception of ASE the bodily injury inflicted upon the Claimant was accidental. It can only be seen as deliberate if one was able to attribute the state of mind of Mr Warren to ASE but there was no reason to do that. Although it had been suggested that there were provisions in the policy which were inconsistent with the conclusion that accidental bodily injury included incidents of the sort in question in this case the Court took the view that on proper examination there were no such inconsistencies. Moreover generally one should construe an insurance policy in favour of the insured. Such a construction would also comply with what would be expected by members of the public attending a Club with Doormen supplied by a company such as ASE.

Appeal dismissed.

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