Vicarious liability in Australia – High Court draws a clear line with Bird v DP

15 November 2024

[Should] the Court…expand the boundaries of vicarious liability beyond a relationship of employment to one that is “akin to employment”. Contrary to the decisions of the courts below and the submissions of DP, the answer is No.

Per Gageler CJ, Gordon, Edelman, Steward and Beach-Jones JJ

Bird v DP (a pseudonym) [2024] HCA 41 at [49].

Key Points

The High Court has delivered its eagerly awaited decision in Bird v DP (a pseudonym) [2024] HCA 41. With it, the High Court has given much-needed clarity on the extent to which religious, volunteer and charitable institutions will be found to be vicariously liable for historical child abuse (or other criminal conduct) perpetrated by their members.

The key takeaway for institutions is that vicarious liability cannot be imposed on an institution for a member’s unlawful conduct absent of a genuine employer/ employee or agency relationship between the institution and the member.

Whilst the decision answers this key question, it does not put to bed the argument of whether a non-delegable duty arises in similar circumstances.

Background

The respondent (DP) alleged that, in 1971, he was assaulted and sexually abused by a Catholic priest, Father Bryan Coffey (Coffey), on ‘pastoral visits’ to his parents’ house. DP sued the Catholic Bishop of Ballarat, Paul Bird (representing the Ballarat Diocese), in the Supreme Court of Victoria for psychological injuries consequent on the abuses.

The Victorian Supreme Court ruled that the Diocese was vicariously liable for Coffey’s abuse of DP, notwithstanding the absence of a typical employment or agency relationship between Dioceses and parish priests. DP’s claim in negligence failed because the evidence did not support a finding that, in 1971, the Diocese knew or should have known Coffey posed the risk of harm which ultimately materialised to DP. There was no pleading of a non-delegable duty.

The Victorian Court of Appeal unanimously dismissed the Diocese’s appeal that it was vicariously liable for Coffey’s conduct. DP did not contest the negligence finding.

The High Court appeal

Vicarious liability

The primary issue before the High Court was whether vicarious liability can or should extend to relationships which do not strictly comprise – but are “akin to” – employment, such as between Diocesan authorities and parish priests.

The Court unanimously held that vicarious liability cannot be imposed absent a genuine employer/employee relationship. In this case, no such relationship existed between Coffey and the Diocese. The Diocese could not be vicariously liable for Coffey’s assaults as a result.

Likewise, a relationship of ‘agency’ will not exist, and therefore vicariously liability will not attach, where unlawful acts are perpetrated by a member without the express or implied consent of an institution.

With this decision, it now appears that where a member’s position confers intimacy and trust, and the opportunity and occasion to offend – being the formulation developed by the High Court (in obiter) in Prince Alfred College Inc v ADC [2016] HCA 37 – these facts alone will not be sufficient to attach vicarious liability to the organisation unless a true employment or agency relationship exists between the offending member and the institution.

‘Non-delegable’ duties of care

DP contended that the High Court should rule on whether the Diocese owed a ‘non-delegable’ duty of care to him through Coffey in his conduct as a priest. The Court ultimately declined to do so, because no such case was pleaded in the Supreme Court.

However, Jagot J considered (in obiter) that a non-delegable duty of care may arise where the provision of care, supervision and control is required to be exercised by a defendant for the safety of a plaintiff. Importantly, the exercise of this duty by a delegate may not necessarily be constrained by the lack of an employment relationship.

Accordingly, it may be that allegations of non-delegable duty and breach – including, for example, in circumstances involving priests – will become a focus for claimants in historical abuse claims in place of vicarious liability arguments. There are also the various statutory duties implemented after the Royal Commission, including Part 1B of the Civil Liability Act 2002 (NSW) and Part XIII of the Pt XIII of the Wrongs Act 1958 (Vic) which introduce broad prospective duties (from 2017 in Victoria and 2018 in New South Wales). The duty in Victoria now provides:

A relevant organisation owes a duty to take the care that in all the circumstances of the case is reasonable to prevent the abuse of a child by an individual associated with the relevant organisation while the child is under the care, supervision or authority of the relevant organisation.

Section 91(2).

Some interesting observations in the Judgment

Gleeson J in dissent on the legal reasoning, but not the outcome on the facts, stated:

This case is a missed opportunity for the Australian common law to develop in accordance with changed social conditions and in tandem with developments in other common law jurisdictions. For the reasons given below, I do not agree with the plurality that relationships that are akin to employment do not attract vicarious liability in Australia.

At [79].

Jagot J made an insightful observation to the effect that the omission of the Royal Commission to recommend changes to the law regarding vicarious liability and the omission of the Victorian Parliament to enact legislation to that effect when dealing with the issue of abuse and its consequences “weigh heavily against any expansion of the common law doctrine of vicarious liability” [at 297]. Although, it is interesting to note that in New South Wales, section 6G of the Civil Liability Act 2002 (NSW) was introduced to provide that “[an] employee of an organisation includes an individual who is akin to an employee of the organisation” for the purposes of the statutory vicarious liability provision in section 6H, and that Tasmania enacted a similarly worded provision.

Implications

Common law duties and the prospective statutory duties continue and the High Court’s decision does not bar liability for the consequences of criminal abuse simply because the perpetrator is not your employee. However, the High Court’s decision does mean that the path to any such liability in Australia under common law is no longer by the easier route of establishing vicarious liability.

Our initial thoughts on the implications are as follows:

  1. Plaintiffs are now more likely to plead non-delegable duties and agency arguments where available as another route to establishing a more strict liability;
  2. A greater focus will now need to be made by plaintiffs on negligence arguments and whether there was a true breach of duty / past knowledge of wrongdoing / causation;
  3. Damages awards are likely to be lower for defendants where they are not the employer, taking into account that interest on general damages is not likely to be awarded;
  4. The decision may reduce the increasing upward pressure on liability insurance premiums for volunteer / charity / other community organisations;
  5. The decision does not necessarily mean that abuse claims will be abandoned, though vicarious liability will no longer be a large focus in the vast majority of these non-employer liability claims; and
  6. Given the reluctance of Courts to award permanent stays (per the GLJ and other recent High Court decisions), the decision will impact current and future claims and no doubt be welcome news for institutional defendants and their insurers.

Please contact any of the authors of this article or your HWLE contact for further insights and advice.

This article was written by Andrew Gray, Partner, Michael Milton, Partner, Patrick Coady, Senior Associate and Ryan Dorahy, Senior Associate.

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