Legal: Employers on notice of vicarious liability
Queensland Teachers' Journal, Vol 127 No 8, 2 November 2022, page no. 23
An unusual drunken toilet mishap has prompted further consideration of the scope of employers’ vicarious liability for non-criminal negligent acts.
With the issue approaching the High Court of Australia, the case of Schokman v CCIG Investments Pty Ltd [2022] QCA 38 prompts timely consideration of when an employer can be held vicariously liable for the acts of their employees.
Vicarious liability
Vicarious liability enables an employer to be liable for an employee’s individual negligence. It is not the same as when an employer breaches its own duty of care to an employee, through acts or omissions of its own. The two should not be confused.
What happened
Mr Schokman was a food and beverage supervisor employed by CCIG Investments Pty Ltd (CCIG) and was required to live in shared accommodation with another employee.
One night after work, the roommate employee consumed alcohol at the staff bar and became intoxicated. In the early hours of the morning, he returned to the shared accommodation, where Schokman was asleep.
Schokman later awoke to the roommate standing over him, urinating on him. Schokman yelled at him to stop, and after a short time, the roommate went to the bathroom and emerged to apologise.
As a result of the incident, Schokman suffered exacerbations of pre-existing conditions of narcolepsy and cataplexy, as well as post-traumatic stress disorder and an adjustment disorder. He brought an action against CCIG, alleging that the employer was vicariously liable for the roommate’s negligent act.
Decision
The Queensland Supreme Court of Rockhampton found that CCIG was not vicariously liable for the incident.
The trial judge considered that the relevant question was “whether there is a connection or nexus between the employment enterprise and the wrong that justifies the imposition of vicarious liability on the employer for the wrong in terms of a fair allocation of the consequence of the risk and/or deterrence”. The trial judge relied on a High Court decision: Prince Alfred College Inc v ADC (2016) 258 CLR 134.
Applying this to Schokman’s case, the trial judge considered that it was not a fair allocation of the consequence of the risk to impose vicarious liability on the employer. While accepting that the incident arose out of the requirement to share accommodation, it was not enough. There was no history of the roommate becoming intoxicated or having an intoxication-related incident that would have put CCIG on notice that he may have engaged in the “bizarre conduct”.
Appeal
Schokman successfully appealed to the Court of Appeal. In its view, Schokman’s case involved an act of negligence that was not intentional or criminal, and so was not the kind of case contemplated by Prince Alfred.
Rather, the Court of Appeal considered Schokman’s case to be analogous to Bugge v Brown, in which an employer was vicariously liable for an employee who negligently lit a fire which spread and destroyed property on an adjoining farm. The negligent employee was provided food by his employer but was instructed to cook it in a different place from where he lit the original fire. The employee’s act was not entirely outside the employment relationship and could not be regarded as the act of a stranger.
By analogy, the Court of Appeal found there was a requisite connection between the roommate’s actions and his employment, which held CCIG vicariously liable for the incident.
The Court of Appeal considered:
- it was a term of the roommate’s employment that he reside in the staff accommodation on the island in the room that was assigned to him
- the roommate was required to live there while employed, and the contract required him to take reasonable care that his acts did not adversely affect the health and safety of others
- the roommate was occupying the room as an employee, pursuant to and under the obligations of his contract.
CCIG was recently granted special leave to appeal this decision to the High Court of Australia.
Key takeaways
Teachers often reside in department-provided accommodation and are often required to reside with colleagues. It is not entirely inconceivable that an altercation or mishap could happen in these situations, even without the presence of alcohol.
If CCIG is unsuccessful in its challenge, the Schokman case could reinforce or support a claim for vicarious liability against the department for a colleague’s own actions towards you, even outside working hours and duties.