How liable are companies for the actions of their people?
16th December 2016
High Court finds company not liable for managing director's assault on employee during post-Christmas party drinks.
Bellman v Northampton Recruitment Ltd
In this case, the High Court had to consider whether a company (employer) was vicariously liable for the violent act of one of its employees following a company Christmas party.
Mr Major was the managing director of Northampton Recruitment Ltd. He recruited the claimant, Mr Bellman (an old friend) as sales manager in 2010.
In 2011, employees and their partners attended the company Christmas party at a golf club. After the party, Mr Major, Mr Bellman and some of the other guests went on to a hotel where some guests were staying. The company paid for the taxi fares.
At the hotel, the group continued drinking alcohol and it was expected that the company would pick up some of the bill. Initially, social topics filled the conversation but later on a controversial work matter arose.
This led to Mr Major losing his temper, highlighting that he was the owner and decision-maker of the company. Mr Bellman challenged Mr Major, and Mr Major responded by punching Mr Bellman. A second punch knocked Mr Bellman unconscious and a fracture to his skull resulted in severe brain damage.
Mr Bellman brought a claim for damages against the company, stating that it was vicariously liable for Mr Major’s violent act.
The Legal Principles
It is well established that the “sufficient connection” test established in Lister v Hesley Hall Ltd is to be applied in claims regarding vicarious liability, to determine whether an act of an employee was committed “in the course of employment”.
In the recent case of Mohamud v WM Morrison Supermarkets Plc, the Supreme Court held that there was a sufficiently close connection between the violent assault of a customer by an employee, and the employee’s job role, making the supermarket liable.
The court applied the test in Lister and asked the following questions:
- Taking a broad approach, what was the nature of the job role and the functions/activities involved?
- Was there sufficient connection between the job role and the wrongful act to make employer liability fair and reasonable?
The court in Bellman considered these questions and also a factor in previous cases regarding the extent to which the employer has created a material “risk of harm”.
It was accepted that managing director, Mr Major, was permitted to act on behalf of the company. This included making decisions that the Christmas party, taxis and drinks were to be paid for by the company. However, as of itself, Mr Major’s job role did not mean that he was “on, or potentially on, duty” just because he was with other employees when the incident occurred.
On the ‘sufficient connection’ question, the court made a distinction between the Christmas party at the golf club and the “impromptu drinks” which followed at the hotel. It held that the after-party drinks were not a “seamless extension” of the party. The assault on Mr Bellman had been committed after the work event.
The court also considered whether the fact that the assault happened as part of a discussion about work, could establish a ‘sufficient connection’. On this point, the court held that the raising of a work-related matter cannot, by itself, change a conversation between colleagues into something “in the course of employment”.
Regarding the company creating a “risk of harm”, it was stated that although the provision of alcohol may increase such a risk, it is commonly provided and enjoyed safely at Christmas parties. The company Christmas party itself had passed without incident.
The court held that the after-party drinks were the result of “entirely voluntary and personal choices” and that any increased risk of harm was not the responsibility of the company.
The court therefore concluded that the defendant company was not vicariously liable for Mr Major’s assault on Mr Bellman.
Some may be surprised by this decision, given that the Supreme Court in the recent case of Mohamud held an assault by an employee to be sufficiently closely connected to the employee’s job role, to make the employer company vicariously liable.
The difference in that case, however, appears to be that the assault occurred during the employee’s shift at work, when the employee was carrying out his job role of serving customers, rather than at an unplanned post-work party drinking event, as in Bellman.
The court in Bellman noted that the boundaries of vicarious liability have often proved difficult to identify, and this is evident in the fact that vicarious liability claims appear to be subject to appeals; the claimant in Mohamud had his claim rejected twice prior to the Supreme Court finding in his favour.
The decision in Bellman may therefore also be appealed in the near future, and the court will have the difficulty of re-applying the somewhat imprecise legal principles.
What does this mean for me?
The decision in Bellman does not change the law, nor does it provide certainty that post-Christmas party drinks are outside of “the course of employment” in relation to vicarious liability claims.
The court highlighted that each case will be determined on its individual facts so employers should exercise caution, both throughout the Christmas party season and on an ongoing basis.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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