Sophia Loren once said “Nothing makes a woman more beautiful than the belief that she is beautiful.” Unfortunately the growth of social media and reality TV has transformed society’s beliefs, and now the ultimate goal of “beauty” consistently changes with every newly released treatment or fad. From hair transplants to botox; laminated brows to fat freezing, the desire to make ourselves more attractive has never been so prominent.

According to the NHBF (National Hairdressing and Beauty Federation) 2020 Aesthetics Survey, the cosmetic surgery industry is currently worth an estimated £3.6 billion. Sadly, whilst the industry has grown, the number of practitioners who are not properly qualified or insured has also increased. There is no regulation of the hairdressing industry and in Scotland there is only limited regulation of certain beauty treatments by Healthcare Improvement Scotland. The lack of regulation ultimately brings with it a significant increase in the numbers of claims, and inevitably issues with insurance.

Insurance not mandatory

There is a common misconception amongst clients, and indeed some practitioners, that the salons where cosmetic and hairdressing treatments take place automatically should have insurance. Whilst a prudent business owner will consider insurance, there is no legal requirement to hold a policy of insurance. As such, the first hurdle facing personal injury lawyers is establishing whether such a policy exists and whether pursuing the claim will be viable. The absence of appropriate cover can often be a barrier to justice and result in a very difficult conversation with the client.

Did you read the small print?

Even if a policy of insurance does exist for the salon, the insurers may refuse to provide indemnity. The defenders may have breached their policy, for example, it is common for cosmetic policies to contain an exclusion clause where a patch test has not been undertaken. Other indemnity issues can arise, for example where the claim has not been timeously intimated, or the policy simply does not cover the particular type of claim. A recent example of this is the reported Sheriff Court Appeal case of Michael Gemmell v KSL Hair & Others [2021] SAC (Civ) 6.

Mr Gemmell was one of many claimants who were left injured, allegedly as a result of hair transplant treatment from KSL Hair Scotland in Glasgow. Proceedings were raised against KSL (who were in liquidation), the two doctors involved in the treatments, and AXA, the insurers of KSL, in terms of the Third Party (Rights Against Insurers) Act 2010.

Decree in absence had passed against KSL and one of the doctors who was not registered with the GMC to practice in the UK. For reasons which were not set out in the decision, the other doctor was released from the action and the case proceeded against AXA. Those acting for AXA sought dismissal of the case on the basis that the policy did not cover this type of claim. The terms of the exclusion clause were key. The Sheriff at first instance agreed and the claim was dismissed. The pursuer appealed.

The Appeal Court took the view the terms of the policy were clear and the Sheriff at first instance had been correct in her interpretation. The insurance policy covered general business risks and excluded claims relating to medical advice and treatment. Doctors administering cosmetic treatments secure cover for associated risk by means of professional indemnity insurance.

It is not clear whether Mr Gemmell will be able to enforce the decrees in absence. From the circumstances of the judgment it looks unlikely as KSL are in liquidation and the first doctor was not registered to practice in the UK, so is unlikely to be insured for procedures in the UK.

So who do you sue?

In light of the insurance hurdle, a solicitor will have to consider properly all options available in terms of who to pursue. Often there will be more than one option, including the individual practitioner or therapist as well as the business itself. This can then give rise to potential arguments about self-employed contractors and whether vicarious liability will attach by virtue of the close connection test.

Personal injury practitioners will be familiar with the plethora of recent cases on vicarious liability. The most recent Supreme Court decision in Barclays Bank Plc v Various Claimants [2020] UKSC 13 re-visited the role of a self-employed contractor.

The Barclays Bank case concerned historical sexual abuse claims by employees. The sexual abuse had been carried out by Dr Bates, an independent doctor instructed by the Bank to carry out medical examinations of prospective employees. The claim was brought by 126 claimants who sought damages against Barclays Bank for sexual assaults that took place over a 16-year period during which Dr Bates undertook medical examinations on its behalf. By the time the claims were made, Dr Bates was deceased and his estate had been distributed. The case was raised against the Bank on the basis that the Bank and its insurers had the means to meet the claims. Following the claimants’ success at the High Court and the Court of Appeal, the Bank appealed to the Supreme Court. The defendant’s case was that Dr Bates was an independent contractor, and as such any liability was his alone.

The Supreme Court found in favour of the Bank. Lady Hale confirmed that the question in cases like this is whether Dr Bates was acting as an independent contractor, carrying on business off his own account, or if he was in a relationship akin to employment. The doctor had his own premises. He had other sources of work and was free to refuse work from Barclays. In short, it was clear Dr Bates was carrying out his own independent business and the Bank was not vicariously liable for his actions.

Rent a Chair Beware

The Supreme Court’s decision made it clear that the long established distinction between employment, and relationships that are akin to employment, and the relationship with an independent contractor remains intact and that the criteria to be considered when establishing the nature of a relationship remain the same. Each case will still have to be considered on its individual facts and merits, as evidenced in the Scottish Sheriff Court case of Grubb v Shannon [2018] SC GLA 13, a case in which Digby Brown represented the pursuer (claimant).

This case involved a self employed therapist who hired a chair in a salon and treated her clients from there. This is a practice particular to the hair and beauty industry and, given the absence of a traditional employer, is one which gives rise to questions relating to the application of vicarious liability.

The therapist carried out an HD brow treatment on the pursuer at the defender’s salon. For those unfamiliar with the treatment, it involves a combination of waxing, tweezing and tinting to produce a ‘high definition’ brow. The tinting procedure requires a patch test to be carried out 48 hours beforehand to ensure that the customer does not suffer an allergic reaction.

Unfortunately for the pursuer, the therapist who provided her treatment did not carry such a test and she suffered an allergic reaction to the dye used in the brow tint. This resulted in her suffering injury to the skin in the eyebrow area and hair loss.

The personal injury claim was initially pursued against the therapist but this case provides an example of the issues created by the operation of an exclusion clause described above as the therapist’s insurers refused to indemnify on the basis that their policy stated that a patch test must be carried out before the procedure. The therapist had no financial means to meet the claim.

Proceedings were raised against the owner of the salon on the basis that she had the means to meet the claim and there was a close connection between the salon and the therapist, which was akin to employment. The case was defended on the basis that the therapist was a self-employed contractor and her relationship to the salon was one of a tenant only.

The case proceeded to Proof (Trial) and the Sheriff issued a judgment in favour of the pursuer, providing a very helpful summary of the law on vicarious liability.

The Sheriff noted the activities the therapist had been entrusted to carry out, including HD eyebrow treatments, were integral to the salon owner’s business and benefitted her directly. Those activities were under the control of the salon owner and not part of the therapist’s independent business. The relationship between the salon owner and the therapist was akin to that of employment, such as to make it just, fair and reasonable that the owner be held vicariously liable for any acts or omissions arising from the activities carried out by the therapist.

Barclays Bank plc and Grubb both provide insight into how the courts analyse the specific features of the circumstances giving rise to personal injury claims. The Grubb case represents the first reported Scottish case on the modern theory of vicarious liability but we see from both decisions that the nature of the relationship is at the heart of the principle of vicarious liability, whatever the subject matter of the claim.  However, the decision in Grubb should garner concern for some businesses such as barbers, hairdressers, beauty salons and tattoo parlours, who traditionally rent space or chairs to other contractors.

Conclusion

The cosmetic industry is growing and it is anticipated that this will result in an increase in the number of personal injury claims for negligent treatments. Putting aside the complexities of the treatments and proving negligence, personal injury practitioners will have to be aware of the significant issues relating to insurance. The recent Appeal decision of Gemmell v KSL & Others acts as a cautionary example of what can happen when dealing with these specialist type claims.