On 16 May 2006, the High Court handed down a decision which further explains the notion of vicarious liability. Vicarious liability arises when the actions of one can be made the actions of another. The court delivered a majority judgment of their Honours Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ with a lengthy plangent dissent from Justice Kirby.

The Fridge Door

The case involved a Mrs Sweeney who went to a Pymble convenience store, within a service station, to buy a carton of milk. When she opened the door of the refrigerator, the door came off and hit her on the head. Boylan Nominees own the refrigerator; they had leased it to Australian Co-operative Foods Limited, who placed it in the service station which was run by the Patels pursuant to a lease.

Boylan, under the terms of the lease agreement, agreed to service and maintain the refrigerator. Boylan subcontracted the maintenance of the refrigerator to a Mr Nick Comninos. Mr Comninos was an independent contractor. Mr Comninos inexpertly “fixed” the door about which complaints had been made. Unfortunately, his repair was not efficacious and the hapless Mrs Sweeney was injured when she opened the door and reached forward for her carton of milk.

All Defendants sued except the One who did it

Mrs Sweeney’s lawyers sued a range of defendants, but did not sue Mr Nick Comninos, the repairer of the door.

It was argued that Boylan Nominees, having the responsibility to maintain the refrigerator, was vicariously liable for Mr Comninos’ inexpert repair of the door.

The trial judge had held that Boylan Nominees was vicariously liable for Comninos’ negligence. That decision was overturned by the New South Wales Court of Appeal. It was from the decision of the Court of Appeal that Mrs Sweeney obtained special leave to the High Court.

The Majority

The majority noted the real distinction the common law had made between employees (for whose conduct the employer will generally be vicariously liable) and independent contractors (for whose conduct the person engaging the contractor will generally not be vicariously liable). The majority stated that it was clear that the bare fact that a repairer’s actions were intended to benefit the owner of the machine, or were undertaken to advance some purpose for the owner, does not suffice to demonstrate that the owner is vicariously liable for the conduct of the repairer. The fact that a repairer might be seen to be, or be described as, the representative, delegate or agent of the owner obscured the need to examine exactly the relationship between the various players.

Whose Business is it?

The proper analysis is to determine whether the repairer was acting within the organisation of the principal, or whether he was acting in an independent capacity. To put it another way, was the repairer part and parcel of the owner’s business, or was he somehow an independent agent who was responsible entirely for his own actions. The majority contrasted the facts in this case to those in a case involving bicycle couriers, Hollis v Vabu [2001] HCA 44. In Hollis the bicycle couriers were found to be employees of a company, whereas in this case the majority found that the repairer was not an employee of Boylan. The repairer supplied his own tools and equipment and brought his own skills to bear upon the work and was not under the same control as the bicycle couriers were in Hollis.

Acting as Principal not Agent

The repairer, importantly, was not presented to the public as an emanation of the respondent. He did not wear Boylan’s uniform, nor did his truck bear the livery of Boylan. What he did was not as an employee of the respondent but as a principal pursuing his own business. This was to be the determinative point in the majority decision.

Slaves and Animals

Justice Kirby, on the other hand, noted that the origins of vicarious liability came from the Roman law concepts of responsibility for the actions of slaves and animals. Justice Kirby considered the facts to be that Boylan Nominees held out the repairer to be their repairer and, as a consequence of that, should be responsible for his actions. Justice Kirby dealt with policy considerations concerning the changing nature of work in the Australian community which has led to greater use of contractors. This trend showed the decision of allocating liability for a plaintiff such as Mrs Sweeney to be a matter of paramount concern.

Changing Nature of Work

His Honour noted that on account of the proliferation of independent contracts in place of employment, cases will arise where the contractor is not insured or cannot be identified, or it cannot be established which of the several contractors was responsible for causing the damage. This may mean that the law of vicarious liability, strictly enforced, may make the difference between recovery and non-recovery.

Trial by Ambush Deplored

As a parting shot, his Honour recorded with a tone of melancholy that the true defence in relation to vicarious liability, and when it was first raised before the trial judge, was an example of trial by ambush. He condemned the practice that a litigant could store up an unpleasant surprise for an opponent and only reveal it at the last minute in a trial. He described it as “… not a proud moment in the administration of justice”. Only when judges exact a price, such as in costs, will unpleasant evidentiary surprises be removed from our culture and practice, he said.

A Warning

This case is a clear warning to litigants not to make assumptions in relation to the actions of one being sheeted home to another, particularly one who may have a deep pocket or may have adequate insurance. It places an enormous onus on plaintiff’s lawyers to make sure they get the right person as a defendant in proceedings such as this. Equally, it is important that defendants are properly advised by use of cross-claims to claim against those who may be directly responsible for a particular act of negligence.