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vicarious liability is still on the move: liability for contractors

19 September 2017

This article is taken from October's health newsletter. Click here to view more articles from this issue.

In recent years, the law of vicarious liability has evolved rapidly to encompass a range of scenarios outside of a conventional employer–employee relationship. Coupled with developments in the courts’ approach to vicarious liability for assaults by employees, this creates a range of new risks to organisations who engage contractors in order to provide services.

Various Claimants v Barclays Bank Plc [2017] EWHC 1929 (QB), concerned alleged sexual assaults perpetrated by a doctor during pre-employment medical examinations.

Dr Bates was a self-employed independent contractor who carried out compulsory medical examinations on prospective employees of Barclays Bank between 1968 and 1974. In the course of those examinations he sexually assaulted his victims. Dr Bates died in 2009, and it was no longer open to any party to pursue his estate for damages. After a police investigation in 2013, 126 claimants joined together in group litigation against the bank.

This judgment concerned the question of vicarious liability; dealt with as a preliminary issue. It was agreed that relevant test had two parts:

  1. Was a relationship between doctor and bank one of employment or 'akin to employment'?
  2. If so, was the sexual assault sufficiently closely connected with that quasi employment?

Stage one – relationships akin to employment

Courts have previously examined this question in a range of scenarios, such as self-employed bouncers1  and prison inmates engaged in paid work within the prison2. In each scenario, the court has examined the similarities and differences between with a ’conventional’ employment relationship in order to determine whether vicarious liability should be found.

The questions addressed relate to the relative ability of the employer and worker to compensate victims, whether the employer has created the risk, the de facto control of the worker and the extent to which the worker is integrated into the business.

In the present case, it was found that only the bank could compensate the claimants. There was no choice as to whether to be medically examined and which doctor to see, and the bank specified the questions to be addressed at the examinations. The bank made the arrangements for the examination (so creating the risk) and the doctor completed a medical report with Barclays headed paper. The examinations were performed on behalf of the bank and for its benefit only and were an integral part of the business of the bank.

Although Dr Bates organised his own professional life and carried other medical activities not for the bank, the court was satisfied that the relationship was sufficiently close to one of employment for vicarious liability to attach.

Stage two – the link between the assault and the employment

The court dealt with the stage two test relatively briefly. The judge observed that young women would have seen Dr Bates as a person in authority. The sexual abuse took place when he was engaged in a task at the time and place required by the bank. She observed that “on the facts, I find that the alleged sexual abuse was inextricably interwoven with the carrying out by the doctor of his duties…in the circumstances I find that the tort is so closely connected with that employment or engagement as to satisfy the second stage”.

The judge acknowledged that her task involved a balancing exercise between two innocent parties. Nevertheless, the action against the bank was the only legal recourse now available to the claimants and, accordingly, she was prepared to find that the defendant is vicariously liable for any assault each claimant may prove was carried out by Dr Bates.

Implications of the case

This decision illustrates that a conventional employment relationship is not required in order to establish vicarious liability. The decision builds on a number of earlier cases, and demonstrates a further application of the broad test of vicarious liability now applied by the courts.

Much of the litigation concerning vicarious liability for abuse in the last 10 years has been directed at organisations who traditionally work with children and vulnerable adults such as social services providers and schools. Increasing attention is being focused upon potential claims against sports clubs, faith organisations and charities.

The boundaries of vicarious liability in this area continue to be tested (for example the case of NA v Nottinghamshire County Council raises vicarious liability for foster carers). We can expect this trend to continue, with close examination of a range of workers (voluntary, independent and employed) and their role in providing services, where this may have led to the occurrence of loss, injury, assaults or abuse.

We recommend all of our clients, including sports clubs, faith organisations and charities to be conscious of the direction the law is taking. Risk managers will wish to scrutinise carefully their organisations’ arrangements with external organisations and contractors in order to establish whether they create a risk of vicarious liability, and to consider what steps (such as insurance requirements and indemnities) can be taken to mitigate the risk.

Insurance arrangements in each case should be checked both to ensure that insurers are provided with an appropriate picture of the risk, in accordance with the duty of fair presentation, and that the terms provide cover which reflects the arrangements in place for delivery of services.

Hawley v Lumar Leisure [2006]

 2 Cox v MOJ [2016]

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The content on this page is provided for the purposes of general interest and information. It contains only brief summaries of aspects of the subject matter and does not provide comprehensive statements of the law. It does not constitute legal advice and does not provide a substitute for it.

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