FROM OPPORTUNITY TO OCCASION: VICARIOUS LIABILITY IN THE HIGH COURT OF AUSTRALIA

Abstract

IN Prince Alfred College Incorporated v ADC [2016] HCA 37, the High Court of Australia (HCA) has once again considered the appropriate test for establishing vicarious liability of employers for the wrongful acts of their employees. The decision will be of interest to tort lawyers in the common-law world for at least four reasons. First, the Court looked afresh at the test for vicarious liability in the context of intentional wrongdoing and has accordingly clarified the confusion arising from its earlier decision in New South Wales v Lepore [2003] HCA 4; (2003) 212 C.L.R. 511. Secondly, the Court expressed very strong disagreement with the decision of the UK Supreme Court handed down just months earlier in Mohamud v WM Morrison Supermarkets plc [2016] UKSC 11; [2016] A.C. 677. The Court apparently regarded Mohamud as having in effect abandoned the Lister qualification that mere opportunity was not enough to satisfy the close connection test (Lister v Hesley Hall Ltd. [2001] UKHL 22; [2002] 1 A.C. 215). Thirdly, the Court appears to have interpreted the relevant English authorities as espousing a Caparo-like criterion of fairness and justice as a separate stage of the close connection test (Caparo Industries plc v Dickman [1990] 2 A.C. 605). That interpretation is questionable. Finally, the Court has articulated a new test in Australian law for vicarious liability reasoning based on whether the employment provided the “occasion” for the wrongdoing to be committed. This prompts a reflection on the difference between “occasion” and “opportunity”, and how this new test is to be applied in practice.