Although pertaining to a set of facts that involve sexual abuse, the High Court decision of Prince Alfred College Incorporated v ADC  HCA 37 is a critical decision on the topic of vicarious liability.
The decision is illustrative of how an employer may attempt to apportion blame or liability upon employees so as to avoid or to minimise its’ own legal liability.
In Prince Alfred College Incorporated v ADC , the High Court restated the general basis for vicarious liability as liability being imposed upon an employer despite the employer not itself being at fault. Traditionally, it has been a requirement that the employee’s wrongful act be committed in the course or scope of employment, but this raises the difficulty of when such an act has indeed occurred in the course or scope of employment.
The historical test for determining the act has occurred in the course or scope of employment is whether the act:
- is authorised by the employer; or
- is an unauthorised mode of doing some other act authorised by the employer.
The historical test further stated that an employer would be liable for unauthorised acts provided they are ‘so connected’ with authorised acts that they may be regarded as modes, although improper modes, of doing them.
The High Court held that a wrongful act, even of a criminal nature, does not preclude the possibility of vicarious liability. What this means is that previously where an employer may rely upon the criminal act of an employee to divulge its liability, such criminal conduct no longer provides an automatic defence for an employer.
The High Court held that the relevant approach is to consider any special role that the employer has assigned to the employee and the position in which the employee is thereby placed vis-à-vis to (in this case) the victim. The victim in an employment setting could be any person who suffers loss, damage or prejudice as a consequence of the actions of the employee.
In determining whether the apparent performance of such a role may be said to give “occasion” for the wrongful act, particular features may be taken into account. They include authority, power, trust, control and the ability (in the facts of this case) to achieve intimacy with the victim.
Where in such circumstances the employee takes advantage of their position with respect to (in this case) the victim, that may suffice to determine that the wrongful act should be regarded as committed in the course or scope of employment and as such render the employer vicariously liable.
About the author – Lee Buntman
Lee Buntman is Senior Industrial Officer for the National and Victorian Divisions of Professionals Australia. Lee has been engaged in legal practice as a lawyer for over 15 years with the majority of that time spent in the union movement. His primary focus at Professionals Australia is upon collective industrial and employment law matters. Lee has undergraduate degrees in Business (management) and Law from Monash University and a Masters of Employment and Labour Law from Melbourne University.