Bellman v Northampton Recruitment Ltd  EWHC 3104 (QB)
Vicarious liability is a common law principle of strict, no-fault liability for wrongs committed by another person. In an employment relationship, it makes an employer liable for the actions of an employee where there is sufficient connection with the employment, even if the employer itself has done nothing wrong (Lister v Hesley Hall Ltd (2001)).
In this case, the court had to consider whether an employer should be liable for the actions of its managing director, who had attacked an employee at drinks following the official Christmas party.
The Claimant, aged 55, was a sales manager. His childhood friend, John Major, was the managing director and shareholder of the company.
All employees and their partners were invited to the Christmas party: 24 people in total. At the end of the party, around half the guests (5 or 6 of those being employees of the company, including the Claimant and Mr Major – neither of whom was actually staying the night there) went back to the hotel where many of them were staying. This was not a pre-planned extension of the party.
The group continued to drink and chat about various non-work topics in the hotel lobby, with the general understanding that either Mr Major or the company would be picking up the bill. At about 2am, the conversation turned to work matters. The Claimant eventually brought up the recent appointment of a new employee, who (it was rumoured) was being paid considerably more than anyone else. Mr Major began to shout and, after the Claimant mentioned the new employee once again, at around 3am he punched the Claimant. The Claimant asked him to stop but, despite the efforts of others present to hold him back, Mr Major punched the Claimant once more and he fell backwards and was knocked unconscious. As a consequence of the resulting brain injuries, the Claimant is unlikely to return to paid employment and lacks the legal capacity to litigate or manage his affairs.
There was no question that Mr Major had thrown the punch. The High Court (Cotter J) considered the case law on vicarious liability (dating back to Lord Holt in Turberville v Stamp (1698), who said, "if my servant doth anything prejudicial to another, it shall bind me when he may be presumed that he acts by my authority, being about my business"). More recently, the Supreme Court had held in Mohamud v WM Morrison Supermarkets Plc (2016) that a court considering whether an employer was vicariously liable should ask itself:
- What is the nature of the employee's job?
- Is there sufficient connection between the position in which the employee was employed and the wrongful conduct to make it right for the employer to be held liable as a principle of social justice?
The High Court noted that Mr Major was the managing director of the company, and in effect "the directing mind and will" of what was a small company. The judge also found that "as with many managers in the modern world, he viewed part of his job to be the motivation of employees" and as such, to oversee the smooth running of the party.
In such a small company, whilst it was not a disciplinary matter not to attend the party, not to do so would have attracted comment and the judge found there was an expectation that employees would attend. However, the organised party at the Golf Club had ended, and with it any expectation or obligation on employees. Unlike, say, Mohamud, there was no seamless episode of events.
Even if the company had paid the bill, there was no increased risk of confrontation arising from the additional alcohol as it was so removed from employment: "what was taking place at 3.00 a.m. at the hotel was a drunken discussion that rose after a personal choice to have yet further alcohol long after a works event had ended." A discussion that veered eventually back to work, after other topics, could not provide a sufficient connection to work to give rise to vicarious liability against the employer.
The High Court held that as a principle of social justice and economic policy there was insufficient connection between Mr Major's position and the assault for the company to be held liable.
What to take away
The judgment is a useful summary of the authorities in this area. At this time of year, it is a timely reminder to employers that they risk being held liable for improper behaviour at works events, especially where alcohol is served even though,in this case,the company ultimately escaped liability.
In Mohamud, the employer was held liable for an attack by an employee on a customer, on the premises, despite his manager telling him to stop. Although the employee's behaviour was a gross abuse of his position, it was a position with which Morrisons had entrusted him, and it was just that as between them and the victim, Morrisons should be held responsible. Here, it was held that the connection had been broken. Both cases are an illustration of how the principles can be difficult to apply and the outcome will often depend upon a court making a full and careful analysis of the facts and circumstances of each case.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.