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By Carol Dalton

Aug 29th, 2018

Historic abuse and vicarious liability: Various Claimants v Barclays Bank

In a landmark decision the Court of Appeal held that Barclays Bank was vicariously liable for historic acts of abuse perpetrated by a Doctor that they had appointed to examine job applicants between 1968 and 1984.

The Bank’s attempt to distance itself - asserting that the Doctor was an independent contractor - failed, making this important case a further demonstration that the doctrine of vicarious liability continues to develop.

When considering the question of vicarious liability, it is important to understand the reasoning for the Judgment. The Court of Appeal largely upheld the views of the High Court when considering the two limbs of the relevant test of vicarious liability.

Testing for vicarious liability – two points to consider.

  1. Whether there was a relationship between the Bank and the Doctor, which could be described as one that was one of employment or akin to employment, in other words a relationship that was capable of giving rise to vicarious liability.
  2. Whether there was a sufficiently close connection between the assaults and the activity for which he was engaged by the bank.

Considering the findings from the High Court.


In assessing the first limb of the test, which was the main focus of the appeal, Lord Irwin considered the findings of the Judge in the High Court;

 
(i) Is the employer more likely to have the means to compensate?


In considering the response they noted that the Doctor had died, with his assets having been distributed many years ago. Further his insurers would not indemnify for abuse. On the other hand the Bank was likely to have the means to compensate the victims and could be expected to have insured against that liability. The Bank had argued the assessment of means should have been considered at the time of the tort (when the Doctor did have funds) rather than at the time the claim was made. However, the Court of Appeal rejected this and found that this criteria was met. That said they expressed the view that no liability could be founded on this consideration alone, and they placed little weight on this point in isolation.


(ii) Was the tort committed as a result of an activity undertaken on behalf of the Bank?


Again the Court considered the principal benefit was to the Bank who wanted employees to give long service, as opposed to the claimants - although the CoA commented that an applicant would usually have some benefit from a medical examination i.e. it opened the door to employment and/or could alert them to a health problem.


(iii) Was it an integral part of the Bank’s business activity?


The Bank argued that this was not an integral part of their business activity (their business was banking). Those acting for the Bank will say that this finding has wide ranging repercussions as it could be applied to any undertaking with employees. However the Court of Appeal held that the selection of suitable employees was integral to the Bank’s business.


(iv) Did the Bank create the risk?


The Court of Appeal concluded that they did, as they directed the claimant as to the time, place and examiner. They also had input into the nature of the examination, whereas the claimants had no choice as to the nature of the examination, or the Doctor they saw.


(v)        On the issue of control the Court of Appeal rejected the argument of the Bank, that there was no more control than sending a claimant for an examination by a medico legal expert. The trial Judge had noted that the claimants had been sent to a particular Doctor and that the Bank both directed the questions to be asked and had input into the medical examination to be carried out. There was no evidence about who had formulated the questions, although the form bore the Bank’s logo. Ultimately the reasoning for finding the requisite “control” element was upheld by the Court of Appeal.
 

The decision

The second limb of the test was also met i.e. that the medical examinations were closely connected with the relationship between the Doctor and the claimants. Finally The Court of Appeal endorsed the Judge’s view that it was fair and just to impose vicarious liability on the Bank.
 
The legal team for the Bank argued that imposing a finding of vicarious liability in this scenario undermined the concept of an independent contractor defence. However the Court of Appeal addressed this, expressing the view that the question of whether an individual is an employee is complex, consequently they state that “the Cox/Mohamud questions will often represent no more challenging a basis for analysing the facts in a given case”.
 

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