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#MeToo but what comes next for third party recovery in claims?

26 March 2018

The #MeToo movement has swept the western world since 2017 and given power back to women who have been harassed or abused in the work place.

Allegations have been reported from all areas of the performing arts, from music, to theatre, to film and television. The sheer volume of the allegations and people coming forward has been astounding. Whilst nobody can be left in doubt the movement has given a voice to those who previously felt unable to come forward, I am unsure anybody could have predicted the strength of the movement or the number of people affected.

There has always been in imbalance in the work place. It is the nature of work that we are all exposed to hierarchical relationships. Staff gain experience, responsibility and corresponding authority as they move up the career ladder. Those who are more junior respect that, and deserve to be treated fairly.

But what happens if things go wrong? In my previous article, the ‘Weinstein effect’ on civil claims I discussed the difficult issue of consent and the widening principle of vicarious liability.

The issue of consent between two adults is difficult to untangle and investigate, both for the criminal and civil justice systems. Nevertheless, if a criminal conviction is secured then a civil claim against the employer, for the alleged wrongdoing of an employee, is relatively straightforward. Firstly, the conviction is held to the higher criminal standard, that of ‘beyond a reasonable doubt.’ In civil claims the standard of proof is ‘on the balance of probabilities’ and so on the face of it, the facts are secured by the conviction and one needs to look at whether the principle of vicarious liability applies.

The difference in these cases is the employed status of the alleged abuser. Should vicarious liability stand and an employer, through no fault of its own, be found liable for the wrong doing of an employee then there is scope to recover damages against the alleged perpetrator. Unlike historical cases, where we often find the convicted perpetrators as ‘men of straw’ these new cases present a different dynamic and a possible route to a recovery of the damages and costs paid out.

Procedurally there are two ways in which the alleged perpetrator can be brought into proceedings. Firstly, by the claimant, who names them as a co-defendant. For a defendant this will often be preferred because the claimant carries what little risk applies to Qualified One Way Cost Shifting and secondly, all the evidence is reviewed at the same time.

Alternatively, the defendant employer can bring in the alleged perpetrator during or after proceedings by way of a Part 20 claim. Here the risk is carried by the defendant employer, particularly as the court made it clear in Arabella Wagenar v Weekend Travel Limited & Anor [2014] WLR(D) 389 that the meaning of 'proceedings' under Part 44.13(1) CPR was held to be a single claim against a defendant or defendants which included a claim for damages for personal injuries. It did not apply to Part 20 claims.

Employers need to look carefully at the assets, earnings and pensions of the alleged perpetrator. Then, give thought to whether expense should be incurred in pursuing an individual for a recovery and finally balance the risk of a possible adverse costs order should the recovery be unsuccessful.

The basis of the recovery claim can be achieved by either an indemnity written, i.e. a cause of action in contract or under Section 1 of the Civil Liability (Contribution) Act 1978.

Section 1(1) of the Act provides that “any person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage (whether jointly with him or otherwise)”. Section 1 covers liability either by way of a judgment or where compromise is achieved by way of an out of court settlement, whether or not liability was formally admitted.

For section 1 of the 1978 Act to apply the, the liability has to be in respect of the “same damage” as set out by the House of Lords in Royal Brompton Hospital NHS Trust v Hammond [2002] UKHL 14. Furthermore, the party from whom contribution is claimed must have been liable to the original claimant.

Thought also needs to be given to when such action should be taken. Action for a recovery does not need to be taken during the main proceedings. The limitation period is two years from the date of liability under Section 10 of the Limitation Act 1980. This two year period applies regardless of whether the limitation period for the claimant to bring proceedings against the perpetrator has expired.

So, whilst we may see a wave of new claims coming forward, with these new claims come the new dynamics and a possible recovery at least for employers and their insurers.

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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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