The law of vicarious liability has recently been revisited by the  Supreme  Court  in  two  important  cases:  Cox v Ministry of Justice 1 and Mohamud v WM Morrison Supermarkets Plc.2

Cox was a case involving Stage 1 of the test for vicarious liability i.e. whether the relationship between D1 and D2 was capable of giving rise to vicarious liability. The issue was whether the prison authorities should be held vicariously liable for the actions of a prisoner who was working in the prison kitchen and who negligently injured a prison officer. The Court of Appeal had reached the conclusion that the relationship was ‘akin to employment’ and thereby satisfied the tests identified by Lord Phillips in Various Claimants v Catholic Child Welfare Society 3 (the ‘Christian Brothers’ case). On appeal, the Ministry of Justice sought to distinguish the position of prisoners on the basis that the prison authorities were required by statute to provide ‘useful work’ to prisoners which was part of their rehabilitation and that such a relationship could not properly be described as one which was ‘akin to employment’.

The Supreme Court (Lord Reed giving the judgment with whom Lord Neuberger, Lady Hale, Lord Dyson and Lord Toulson agreed) rejected the contention that the relationship between the prison service and the prisoner was insufficiently ‘akin’ to employment. He held that the general approach set out in the Christian Brothers case was not confined to sex abuse cases and was intended to provide a  basis for identifying the circumstances in which vicarious liability would attach outside the employer/employee relationship.  By focusing on  the business activities carried on by the defendant and its attendant risks, the law had extended vicarious liability in such a way that victims of torts were protected, notwithstanding changes to the legal relationship between enterprises and members of their workforces. It was important not to be misled by a narrow focus on semantics such as ‘enterprise’, ‘business’ and ‘benefit’ since the defendant need not be carrying out activities of a commercial nature; it was sufficient that the activities were being carried out in furtherance of the defendant’s own interests and a wide range of circumstances could satisfy those requirements. In addition, employers could not avoid vicarious liability based on technical arguments as to the employment status of the individual who committed the tort.

On the facts of Cox, the requirements in the Christian Brothers case were met; the fact that the work of the prisoners was in the public interest did not justify the conclusion that it was outside the scope of vicarious liability. The prison service had chosen to place prisoners in a position whereby they could commit negligent acts. None of the suggested points of distinction with an employer/employee relationship justified the conclusion that liability could not attach. In addition it was not always necessary to ask the question whether it was ‘fair, just and reasonable’ to impose vicarious liability; the fact that the tests in the Catholic Brothers case were satisfied was itself an indication of what was ‘fair, just and reasonable’ since those criteria were designed to align with the various policy justifications for the doctrine. However there was a legitimate distinction between work in the kitchens and rehabilitation activities such as educational classes or offending behaviour programmes which were not activities forming an integral part of the operation of the prison and for its benefit.

The decision is of particular relevance to non-profit making organisations. They will be liable for negligent acts committed by individuals who are acting in furtherance of their aims and objectives, even if some of the incidents of a ‘normal’ employment relationship are absent. The decision clarifies that ‘enterprise’ liability is of broad application outside the profit-making sphere. Consequently the acid test is whether harm is wrongfully done by an individual who carries on activities as an integral part of the business activities carried on by a defendant and for its benefit (rather than his activities being entirely attributable to the conduct of a recognisably independent business of his own or of a third party), and where the commission of the wrongful act is a risk created by the defendant by assigning those activities to the individual in question.

Mohamud  was  concerned  with  Stage  2  of  the  test i.e. looking at the connection between D2 and the act or omission of D1. Mr Mohamud had entered a petrol station kiosk and, after being subjected to foul, racist and threatening language by a Morrison’s employee, was ordered to leave. The employee followed Mr Mohamud back to his car and punched him; subjecting him to a serious attack. Both at first instance and in the Court of Appeal, Mr Mohamud’s claim was rejected on the basis that there was an insufficiently close connection between what the employee was employed to do and his tortious conduct in attacking the claimant.

In the Supreme Court the claimant challenged whether the ‘close connection’ test was the appropriate standard to apply. Instead the claimant proposed a broader ‘representative capacity’ test i.e. whether a reasonable observer would consider the employee to be acting in the capacity of a representative of the employer at the time of committing the tort. But the Supreme Court (Lord Toulson giving the lead judgment with whom Lord Neuberger, Lady Hale and Lord Reed agreed) rejected the contention that the ‘close connection’ test was flawed; it had been followed at the highest level and there was nothing wrong with it as such.

However, applying the ‘close connection’ test on the facts of the case, the Supreme Court reversed the Court of Appeal decision and held that the test was satisfied. It was the employee’s job to attend to customers and respond to their inquiries. His conduct in responding to the claimant’s request with abuse was inexcusable, but interacting with  customers  was  within  the  field of activities assigned to him by his employer. What happened thereafter  was an  unbroken  sequence of events. The connection between the field of activities assigned to the employee and his employment did not cease at the moment when he came out from behind the counter and followed the claimant onto the forecourt.

He had not metaphorically taken off his uniform the moment he stepped out from behind the counter and when he followed the claimant to his car and told him not to come back to the petrol station, that was not something personal between them, but an order to keep away from his employer’s premises. In giving the order he was purporting to act about his employer’s business. His motive in carrying out the attack was irrelevant.

This decision is of real significance in how the close connection test is to be interpreted. It will undoubtedly make it harder for employers to assert that a violent act by an employee fails to satisfy the test for vicarious liability, particularly where the act occurs at the workplace and the tortfeasor is purporting to act about his employer’s business.

Kate Grange and Stephen Kosmin appeared on behalf of the Ministry of Justice in Cox in the Supreme Court.