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Vicarious Liability; Non-delegable duties;

Solidary/Concurrent/Joint & Several Liability; and
Contribution rights.
Lecture and Study Outline, Topics 14 and 15. LLB Torts -2017

Professor Barbara McDonald.

Aims of this topic: to develop statutory interpretation skills and an understanding

of the following issues:
- the difference at law between employees and independent contractors
- the circumstances in which an employer may be vicariously liable for the
torts of an employee
- the tests for whether conduct occurred in the course of employment

- the incidence and significance of common law “non-delegable” duties

- the practical significance of damage or loss having been caused by multiple

wrongdoers (whether in contract, tort or under some statutes)
- the statutory context of contribution rights between wrongdoers

(Casebook references are to 5th and 6th edition of Cases on Torts)

Introduction
In many cases, a plaintiff P will have suffered loss as a result of the negligence or
other torts or other wrongs (e.g. breach of contract, breach of a fiduciary duty,
breach of a statute) of more than one person ( A, B and C etc). In such cases the
liability of the various wrongdoers may be “concurrent”. In this topic we look at
various aspects of such multi-party litigation:

- The circumstances when A will be vicariously liable for the torts of B (and thus
jointly and severally liable with B to P) ( Part 1) ;
-
- P’s rights against concurrent “tortfeasors” or wrongdoers A, B and C ( Part 2
below) – under the regime of joint and/or several or “solidary” liability which
applies to personal injury claims. [Note: a new regime of proportionate
liability applies to negligently inflicted property damage and pure economic
loss and will be studied in Torts and Contracts 2.]

- The rights of those tortfeasors (A, B and C) between each other to seek
contribution or indemnity, including in the context of an employment
relationship.

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PART 1. VICARIOUS LIABILITY

(i) Introduction:
Rationales of vicarious liability

See Hollis v Vabu P/L HCA 2001 (casebook 395 or 456)

Recently, in The Catholic Child Welfare Society & Ors v Various Claimants [2012] UKSC
56, [2013] 2 AC 1, per Lord Phillips with whom the other Law Lords agreed , said:

There is no difficulty in identifying a number of policy reasons that usually

make it fair, just and reasonable to impose vicarious liability on the
employer when these criteria are satisfied: i) The employer is more likely
to have the means to compensate the victim than the employee and can be
expected to have insured against that liability; ii) The tort will have been
committed as a result of activity being taken by the employee on behalf of
the employer; iii) The employee’s activity is likely to be part of the
business activity of the employer; iv) The employer, by employing the
employee to carry on the activity will have created the risk of the tort
committed by the employee; v) The employee will, to a greater or lesser
degree, have been under the control of the employer.

There are three instances of vicarious liability at common law: employer/employee;

principal/agent; partner/partner. In 2017 we will not consider agency or
partnerships.

An employer is vicariously liable for a tort committed by an employee in the course

of employment. An employer’s vicarious liability is a form of strict
liability in the sense that it is not dependent on any personal fault on the
part of the employer. But it does require proof that the employee was at
fault.

An employer is not generally liable for a tort committed by an independent

contractor. There are a very limited number of exceptions to this rule. If
an employer authorises or directs an an activity which necessarily involves
a tort being committed then the employer may be liable – probably best
then to describe the independent contractor as the “agent” of the
employer but agency is complex in tort law.

NB: The vicarious liability of an employer does not affect the personal
responsibility of the employee who committed the tort as between the
employee and the tort victim, although the employee may be entitled to
be indemnified by the employer (see further the Employees Liability Act
1991 (NSW) discussed below under contribution) .

Australian law does not recognise any concept of dual vicarious liability: Day v The
Ocean Beach Hotel Shellharbour Pty Ltd (2013) 85 NSWLR 335, (leave to appeal

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refused by HCA), applying Oceanic Crest Shipping Co v Pilbara Harbour Services Pty
Ltd (1986) 160 CLR 626. Cf English law which allows dual vicarious liability: The
Catholic Child Welfare Society & Ors v Various Claimants [2012] UKSC 56, [2013] 2
AC 1 at paras 40ff.

(ii) Relationship of employer and employee (note this analysis could also be
useful when deciding if a per quod servitium amisit claim arises for an
employer where an employee is injured by a defendant; see topic 16).

How does a court decide whether a person is an employee or an independent

contractor? What tests have courts used in the past? Compare the
“control” test and the “organisation” test. Stevens v Brodribb 1986 HCA
What factors does the court now take into account to decide this issue? See
Zuis v Wirth Bros P/L 1955 HCA (casebook 394 or 455) and Hollis v Vabu
P/L HCA 2001 (casebook 395 or 456)
As a matter of policy, what advantages are there in finding that a person is an
employee rather than an independent contractor? Hollis v Vabu

(iii) Course of employment

The course of employment includes an act authorised by the employer and an act
which constitutes an unauthorised mode of performing an authorised act.
The course of employment does not include the employee’s wrongful acts
which are unconnected with and not incidental to the acts the employee is
engaged to perform. Bugge v Brown 1919 HCA (casebook 398 or 460),
Deatons v Flew 1949 HCA (casebook 389 or 461), Starks v RSM Security
NSWCA 2004 (casebook 401 or 463)

When is an employee on a “frolic of his own”? Joel v Morison (1834) 6 CAR. & P.502;
172 ER 1338 (Casebook , p 397 or 459)

M employed E to deliver newspaper from a van. M expressly told E not to throw the
papers from the van but to get out and place them in each customer’s property. E, in
a hurry to deliver all the papers before the end of his shift, threw some of the papers
from the van and in doing so, hit P who was on his morning jog. He fell and broke his
ankle. Is M liable?
What if E threw the paper because he hated joggers?

Recent case law has had to consider whether and in what circumstances sexual
assault on a pupil or patient who is in the employer’s care -or other serious
intentional criminal conduct by an employee -might be considered to be in the
course of employment on the traditional tests.
Why might the victim need to rely on vicarious liability in such cases?
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Is there a better test in such cases for determining what is in the “course of
employment”? English and Canadian cases developed the “close connection test” :

Bazley v Curry (1999) 174 DLR (4th) 45 and Jacobi v Griffiths (1999) 174 DLR (4th)
71 which also took an “enterprise risk” approach
Lister v Hesley Hall [2002] 1 AC 215 endorsed the “close connection” test. Note Lord
Millet at para 83:
“Experience shows that in the case of boarding schools, prisons, nursing
homes, old people’s homes, geriatric wards, and other residential homes
for the young or vulnerable, there is an inherent risk that indecent assaults
on the residents will be committed by those placed in authority over them,
particularly if they are in close proximity to them and occupying a position
of trust. ”
In The Catholic Child Welfare Society & Ors v Various Claimants [2012] UKSC 56,
[2013] 2 AC 1 per Lord Phillips with whom the other Law Lords agreed , said at
para 74:
It is not easy to deduce from Lister the precise criteria that will give rise to
vicarious liability for sexual abuse. The test of “close connection” approved by
all tells one nothing about the nature of the connection. Lord Clyde and Lord
Hobhouse found it significant that the tortfeasor’s employment involved
exercising care for the victim. Only Lord Millett expressly endorsed the
importance that the Canadian decisions attached to the creation of risk. This
has, however, been identified as of significance in most of the cases that have
followed.”
In Lepore v NSW, 2003, the HCA considered, inter alia, the issue of vicarious liability
of schools for sexual assault. Commenting on Lepore, Lord Phillips in The Catholic
Child Welfare Society & Ors v Various Claimants [2012] UKSC 56, [2013] 2 AC 1 at
para 82 said;

The High Court of Australia, when considering whether a school authority

could be vicariously liable for sexual assault committed on a pupil by a
teacher, has shown a bewildering variety of analysis: New South Wales v
Lepore [2003] HCA 4; 212 CLR 511. Only Gleeson CJ and Kirby J were
prepared to consider following the approach of the Canadian and English
decisions.

The High Court of Australia in Prince Alfred College Incorporated v ADC [2016]
HCA 37( casebook, 6th ed p 466) upheld a school’s appeal from a decision of
the South Australia Supreme Court Full Court and restored the judge’s
decision that an extension of the limitation period should not be granted. In
doing so the Court set out the approach that Australian courts should follow
in such cases to the question of vicarious liability. See paragraphs 80-81 of
the majority judgment and 127-131 of the concurring judgment of Gageler
and Gordon JJ.

What is the approach? Is it clear? Will it provide certainty and predictability of

outcome? What precedential standing does the decision have? Was it part of the ratio
or merely obiter? (Does it matter?)

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PART 2: NON-DELEGABLE DUTIES

These are situations where the courts have held that an employer (whether of an
employee or an independent contractor) cannot escape liability for negligence by
delegating the performance of the duty and will be “personally” liable if the delegate
is negligent.
What does it mean to describe the duty as non-delegable? An example is an
employer’s duty to provide a safe workplace for his or her employees.
The concept of a non-delegable duty is particularly useful or tends to be argued
where the injured person cannot point to any personal failing on the part of the
employer (eg no failure to supervise, no failure to take care in selecting the employee
or independent contractor) and where it would be difficult or impossible to succeed
on the basis that the employer is vicariously liable for what the employee did.
The exact nature of such a duty and the circumstances when it applies are
controversial.

The concept of a non-delegable duty first appeared in the House of Lords decision in
Wilson & Clyde Coal Co v English [1938] AC 57 in the context of workplace injuries.
This case is discussed By Mason J in Kondis (see casebook 407/479).

The three situations where this non-delegable liability is relatively uncontroversial

are:
 the liability of hospitals to their own patients (Cassidy v Ministry of Health,
Ellis v Wallsend District Hospital (1989, NSWCA) ( contrast private patients
who have chosen their own doctor),
 the liability of employers to employees for workplace safety,
 the liability of schools to pupils (Commonwealth v Introvigne, HCA 1982).

What features are common to these situations which justify this more stringent
duty? See Mason J’s explanation of when a non-delegable duty will be recognized
in Kondis v STA (19840 154 CLR 672 at 687 ( Casebook page 409/482)

Lord Denning MR in Morris v Martin [1966] 1 QB 716 at 724-5 explained the

distinction between a delegable duty and a non-delegable duty in his own way. In
that case, the plaintiff had entrusted a mink stole to a furrier for cleaning. The furrier
with the plaintiff consent sent it to the defendants, whose servant stole the stole. It
was never recovered. Plaintiffs sued the defendants in negligence. Judge had held
that stealing the fur was not in the course of employment. Court of Appeal held the
defendants liable. Why?

[This] case raises the important question of how far a master is liable for theft or dishonesty
by one of his servants. If the master has himself been at fault in not employing a trustworthy
man, of course he is liable. But what is the position when the master is not himself at fault at
all?
The law on this subject has developed greatly over the years. During the 19th century it was
accepted law that a master was liable for the dishonesty or fraud of his servant if it was done
in the course of his employment and for his master's benefit. Dishonesty or fraud by the

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servant for his own benefit took the case out of the course of his employment. The judges
took this simple view: No servant who turns thief and steals is acting in the course of his
employment. He is acting outside it altogether. But in 1912 the law was revolutionised by
Lloyd v. Grace, Smith & Co., 2 where it was held that a master was liable for the dishonesty or
fraud of his servant if it was done within the course of his employment, no matter whether it
was done for the benefit of the master or for the benefit of the servant. Nevertheless there
still remains the question: What is meant by the phrase "in the course of his employment"?
When can it be said that the dishonesty or fraud of a servant, done for his own benefit, is in
the course of his employment?
On this question the cases are baffling. In particular those cases, much discussed before us,
where a bailee's servant dishonestly drives a vehicle for his own benefit. These stretch
from Coupé Co. v. Maddick 3 to the present day. Let me take an illustration well fitted for a
moot. Suppose the owner of a car takes it to a garage to be repaired. It is repaired by a
garage hand who is then told to drive it back to the owner. But instead, he takes it out on a
"frolic of his own" (to use the 19th-century phrase) or on a "joyride" (to come into the 20th
century). He takes it out, let us say, on a drunken escapade or on a thieving expedition. Nay
more, for it is all the same, let us suppose the garage hand steals the car himself and drives
off at speed. He runs into a motor cyclist. Both the car and the motor cycle are damaged.
Both owners sue the garage proprietor for the negligence of his servant. The motor cyclist
clearly cannot recover against the garage proprietor for the simple reason that at the time
of the accident the servant was not acting in the course of his employment: see Storey v.
Ashton. 4 You might think also that the owner of the car could not recover, and for the self-
same reason, namely, that the servant was not acting in the course of his employment. And
before 1912 the courts would undoubtedly have so held: see Sanderson v. Collins 5 and
Cheshire v. Bailey, 6 as explained by Lord Shaw in Lloyd v. Grace, Smith & Co.7 itself. But since
1912 it seems fairly clear that the owner of the damaged car could recover from the garage
proprietor, see Central Motors (Glasgow) Ltd. v. Cessnock Garage & Motor Co., 8 on the
ground that, although the garage hand was using the car for his own private purposes, "He
should be regarded as still acting in the course of his employment," see Aitchison v. Page
Motors, 9 and even if he stole the car on the journey, it was a conversion "in the course of the
employment": see United Africa Co. Ltd. v. Saka Owoade.
I ask myself, How can this be? How can the servant, on one and the same journey, be acting
both within and without the course of his employment? Within qua the car owner. Without
qua the motor cyclist. It is time we got rid of this confusion. And the only way to do it, so
far as I can see, is by reference to the duty laid by the law on the master. The duty of the
garage proprietor to the owner of the car is very different from his duty to the motor
cyclist. He owes to the owner of the car the duty of a bailee for reward, whereas he owes
no such duty to the motor cyclist on the road. He does not even owe him a duty to use care
not to injure him.
If you go through the cases on this difficult subject, you will find that, in the ultimate
analysis, they depend on the nature of the duty owed by the master towards the person
whose goods have been lost or damaged (emphasis added). If the master is under a duty to
use due care to keep goods safely and protect them from theft and depredation, he cannot
get rid of his responsibility by delegating his duty to another. If he entrusts that duty to his
servant, he is answerable for the way in which the servant conducts himself therein. No
matter whether the servant be negligent, fraudulent, or dishonest, the master is liable. But
not when he is under no such duty. The cases show this. …. [ he then discusses various
situations and cases]:
…From all these instances we may deduce the general proposition that when a principal has
in his charge the goods or belongings of another in such circumstances that he is under a
duty to take all reasonable precautions to protect them from theft or depredation, then if he
entrusts that duty to a servant or agent, he is answerable for the manner in which that
servant or agent carries out his duty. If the servant or agent is careless so that they are stolen
by a stranger, the master is liable. So also if the servant or agent himself steals them or makes
away with them.

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The same sort of reasoning – to determine if a duty is the ordinary one (where a
person will not be liable for the negligence of an independent contractor) or a
non-delegable one ( where the person will be liable if the independent contractor
is negligent ) – is used in the medical context:

Samuels JA, with whom Meagher JA agreed, in Ellis v Wallsend District Hospital
[1989] NSWLR 553 (NSWCA) explained the possible different scope of a hospitals
hospital’s duty in this way at at 604-605:

“[W]hile proof of the relationship of hospital and “patient” will generate a special duty of
some kind, closer scrutiny of the facts (cf the analysis proposed by Mason J in Stevens v
Brodribb Sawmilling) is necessary in order to establish its scope. It is a question of what
medical services the hospital has undertaken to supply. In a case such as Albrighto where the
patient went directly to the hospital for advice and treatment a special duty will arise and may
well embrace the provision of the “complete medical services” which Reynolds JA (at 561)
thought it open to conclude that the hospital had undertaken to render, and that duty arose as
soon as the plaintiff resorted to the hospital's out-patients' clinic; it did not wait upon
admission. In such a case the hospital, by accepting the patient, undertakes to make available
all the therapeutic skill and devices which it is reasonably able to deploy. The patient's choice
is determined by his or her decision to knock at the door of the defendant's hospital, as Lord
Greene put it in Gold (at 302). If the hospital's response is to open the door and admit the
patient B to the benefits of the medical and surgical cornucopia within it remains responsible
to ensure that whatever treatment or advice the horn disgorges is given with proper care; its
duty cannot be divested by delegation.

But the evidence in a particular case may establish that the hospital's undertaking was of a
more limited kind. As Morris LJ pointed out in Roe (at 89) and (at 91), the nature of the
obligation which a hospital has assumed becomes ultimately a question of fact, a proposition
which the Court of Appeal adopted in Albrighton. In the present case, however, it is quite
clear that the appellant did not knock at the hospital's door in the sense contemplated by Lord
Greene. It was not the hospital's door but the door of the late Dr Chambers' consulting rooms
upon which she knocked, and it was that door which was opened to her and which admitted
her to the treatment and advice upon which she thereafter principally relied. I do not think it
can be doubted but that it was Dr Chambers and not the hospital to whom the D appellant
looked for medical care. The hospital, for reasons which I have already discussed and will not
repeat, was merely the place in which surgical procedures which he had recommended and
which the appellant had agreed to undergo were performed by Dr Chambers. The hospital in
the present case was exactly what the hospital was not in Albrighton. To reverse Reynolds JA's
words in that case (at 562) the hospital here was “a mere custodial institution designed to
provide a place where medical personnel E could … treat persons lodged there …”. Of course
the appellant stood in a “special protective relationship” to both the hospital and Dr Chambers,
but in respect of different kinds of care. The appellant looked to Dr Chambers for surgical
intervention, and to the hospital for nursing care and perhaps the provision of other medical
treatment. In rendering that care and treatment the hospital was no doubt under a non-
delegable duty which might have been of relevance in certain circumstances. But in the event
no question arises concerning matters of that sort.
My conclusion does not impose differential duties on a hospital. Following Kondis a hospital
owes an independent non-delegable duty to ensure that the treatment it undertakes to provide
is performed with reasonable care. The question in every case is the nature of that
undertaking.

Outside those three established categories above, other situations are more
problematic and controversial. Despite a somewhat surprising extension in the 1990s
in Burnie Port Authority v General Jones (Casebook p 410/483) (occupier held to have

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a non-delegable duty to a neighbouring occupier and thus liable for property damage
caused by an independent contractor’s negligence , because independent contractor
was dealing with dangerous activity or substances),the HCA has recently refused to
hold that a road authority has a non-delegable liability in respect of an
independent contractor digging up the road (Leichhardt Council v Montgomery HCA
2007,(casebook p 424/494), emphasizing instead the general rule that a person is
not liable for the negligence of an independent contractor.

Can there be a “non-delegable duty” and thus liability in respect of intentional

torts committed by an employee? The HCA in NSW v Lepore (2003, HCA, Casebook
p 416/489) said no. What are the difficulties of arguing that non-delegable duties
extend to intentional torts? Is it consistent with the policies that underlie the
imposition of liability on an employer?

In Woodland v Essex County Council [2013] UKSC 66, the Supreme Court of the
United Kingdom recently upheld an appeal against a judge’s decision to strike out a
claim against a school, based on breach of a non-delegable duty. The school had
delegated swimming lessons held at a local swimming pool during school hours to
non-employees. The 10 year old plaintiff suffered brain injury after nearly drowning.
Lord Sumption at [22]:
22. The main problem about this area of the law is to prevent the exception from eating up the
rule. Non-delegable duties of care are inconsistent with the fault-based principles on which
the law of negligence is based, and are therefore exceptional. The difference between an
ordinary duty of care and a non-delegable duty must therefore be more than a question of
degree. In particular, the question cannot depend simply on the degree of risk involved in the
relevant activity. The ordinary principles of tortious liability are perfectly capable of
answering the question what duty is an appropriate response to a given level of risk.

23. In my view, the time has come to recognise that Lord Greene in Gold and Denning LJ in
Cassidy were correct in identifying the underlying principle, and while I would not necessarily
subscribe to every dictum in the Australian cases, in my opinion they are broadly correct in
their analysis of the factors that have given rise to non-delegable duties of care. If the
highway and hazard cases are put to one side, the remaining cases are characterised by the
following defining features:

(1) The claimant is a patient or a child, or for some other reason is especially vulnerable or
dependent on the protection of the defendant against the risk of injury. Other examples are
likely to be prisoners and residents in care homes.
(2) There is an antecedent relationship between the claimant and the defendant,
independent of the negligent act or omission itself, (i) which places the claimant in the actual
custody, charge or care of the defendant, and (ii) from which it is possible to impute to the
defendant the assumption of a positive duty to protect the claimant from harm, and not just
a duty to refrain from conduct which will foreseeably damage the claimant. It is characteristic
of such relationships that they involve an element of control over the claimant, which varies
in intensity from one situation to another, but is clearly very substantial in the case of
schoolchildren.
(3) The claimant has no control over how the defendant chooses to perform those
obligations, i.e. whether personally or through employees or through third parties.
(4) The defendant has delegated to a third party some function which is an integral part of
the positive duty which he has assumed towards the claimant; and the third party is
exercising, for the purpose of the function thus delegated to him, the defendant's custody or
care of the claimant and the element of control that goes with it.

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(5) The third party has been negligent not in some collateral respect but in the performance
of the very function assumed by the defendant and delegated by the defendant to him.

….
25. The courts should be sensitive about imposing unreasonable financial burdens on those
providing critical public services. A non-delegable duty of care should be imputed to schools
only so far as it would be fair, just and reasonable to do so. But I do not accept that any
unreasonable burden would be cast on them by recognising the existence of a non-delegable
duty on the criteria which I have summarised above. My reasons are as follows:

(1) The criteria themselves are consistent with the long-standing policy of the law, apparent
notably in the employment cases, to protect those who are both inherently vulnerable and
highly dependent on the observance of proper standards of care by those with a significant
degree of control over their lives. Schools are employed to educate children, which they can
do only if they are allowed authority over them. That authority confers on them a significant
degree of control. When the school's own control is delegated to someone else for the
purpose of performing part of the school's own educational function, it is wholly reasonable
that the school should be answerable for the careful exercise of its control by the delegate.
(2) Parents are required by law to entrust their child to a school. They do so in reliance on the
school's ability to look after them, and generally have no knowledge of or influence over the
arrangements that the school may make to delegate specialised functions, or the basis on
which they do so, or the competence of the delegates, all of which are matters about which
only the school is in a position to satisfy itself.
(3) This is not an open-ended liability, for there are important limitations on the range of
matters for which a school or education authority assumes non-delegable duties. They are
liable for the negligence of independent contractors only if and so far as the latter are
performing functions which the school has assumed for itself a duty to perform, generally in
school hours and on school premises (or at other times or places where the school may carry
out its educational functions). In the absence of negligence of their own, for example in the
selection of contractors, they will not be liable for the negligence of independent contractors
where on analysis their own duty is not to perform the relevant function but only to arrange
for its performance. They will not be liable for the defaults of independent contractors
providing extra-curricular activities outside school hours, such as school trips in the holidays.
Nor will they be liable for the negligence of those to whom no control over the child has been
delegated, such as bus drivers or the theatres, zoos or museums to which children may be
taken by school staff in school hours, to take some of the examples canvassed in argument
and by Laws LJ in his dissenting judgment…..

Part 3: CONCURRENT LIABILITY

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Since 2004 it has become important to distinguish between, on the one hand, claims
for negligence for property damage or economic loss, and on the other hand, all
other tort claims such as negligence claims for personal injury and all intentional tort
claims for any type of damage. Proportionate liability applies to the first type of
claim while joint and/or several liability, or “solidary” liability, applies to all the rest.

It is first necessary to distinguish two types of tortfeasors (people who have

committed a tort), as this may affect liability too.

Defining “joint tortfeasors” or “several concurrent tortfeasors”.

Tortfeasors are “joint” where there is only one tortious act or omission but more
than one person is legally responsible: e.g.
- an act jointly committed or committed “in concert”;
- a joint duty breached;
- an act ( or omission) where the person who committed it is personally liable
and someone else is vicariously liable for the same act.
-
Examples?

Tortfeasors are several concurrent tortfeasors where different acts or omissions

contributed to the same damage to the plaintiff. Those acts may happen
simultaneously or successively.

Examples?

Distinguish “several concurrent tortfeasors” from successive tortfeasors who cause

different damage to the plaintiff. The liability of the latter is not “concurrent”.

Examples?

Plaintiff’s rights against concurrent tortfeasors where joint and/or

several liability applies.

[Note the regime described here – unitary, solidary or “joint and several liability” -
applies to all torts other than those to which proportionate liability now applies,
discussed below in section C. Essentially this means that all liability for personal
injury, however caused, is joint and/or several and liability for intentional torts in
general is joint and/or several.]

At common law, joint tortfeasors have what is known as a solidary or unitary liability
to the plaintiff- they are jointly liable for all the loss. There is only one cause of action

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against all of them. But they are also severally liable, in the sense that the plaintiff
can recover 100% of the loss from any one joint tortfeasor.

As there is only one cause of action, the release of one joint tortfeasor would release
them all.

If the concurrent tortfeasors were only severally liable, for different torts causing the
same damage, there were multiple causes of action. Again the plaintiff could recover
100%of the loss from any one several concurrent tortfeasor.

[NB: A plaintiff can never recover more than 100% of his/her loss from any or all of
the sources.]

At common law, a cause of action is said to merge in and come to an end with the
judgment. Because, where parties have a joint liability, there is only one cause of
action, then, if the plaintiff P sued any one of the joint tortfeasors (A) and obtained a
judgment, it followed that this would bring the single cause of action against the
others( B and C) to an end as well. The plaintiff would be barred from suing the
others, even if A was only able to pay 50% of the judgment. (Brinsmead v Harrison
1872).

By contrast, a judgment against a several concurrent tortfeasor had no effect on the

others as there were multiple causes of action.

S 5 (1) (a) of the Law Reform Miscellaneous Provisions Act 1946 (NSW) (page 51
course guide):

(a) judgment recovered against any tort-feasor liable in respect of

that damage shall not be a bar to an action against any other person
who would, if sued, have been liable as a joint tort-feasor in respect of
the same damage;

This section then literally overcomes the rule in Brinsmead v Harrison that judgment
against one tortfeasor bars an action against another joint tortfeasor.

Does it do more than that? Can we go past the literal words?

P sues A for damage caused jointly by A and B. A settles the claim by paying 50% of
the loss claimed. Can P sue B for the balance?

In Thompson v Australian Capital Television HCA, 1996: section 5 (1) (a) in effect
actually abolishes the common law rule that there is only one cause of action against
all joint tortfeasors, so a release of one no longer releases them all.

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[Nevertheless it is important that any settlement not imply that P has received full
compensation for his/her loss, as full satisfaction of a claim will also bring the claim
to an end.]

If P sues A and the court assesses the loss at $50, then P sues B, can P recover more
than $50 in total?

Section 5 ( 1) ( b) provides:
(b) if more than one action is brought in respect of that damage
by or on behalf of the person by whom it was suffered…against tort-
feasors liable in respect of the damage (whether as joint tort-feasors
or otherwise) the sums recoverable under the judgments given in
those actions by way of damages shall not in the aggregate exceed the
amount of the damages awarded by the judgment first given; and in
any of those actions, other than that in which judgment is first given,
the plaintiff shall not be entitled to costs unless the court is of opinion
that there was reasonable ground for bringing the action;

What is the rationale for limiting a plaintiff to the damages awarded in the first
action?

If A and B are joint tortfeasors are they always liable for the same amount?

Generally yes, but contrast the situation where exemplary damages are payable. In
XL Petroleum v Caltex Oil (1985) HCA (casebook p 429/500), Caltex engaged some
plumbers to, in effect, trespass on land and spike the underground petrol tanks of a
competitor. Caltex’s behaviour warranted exemplary damages ($150,000), but as the
plumbers were joint tortfeasors, did this mean that they also had to be liable for the
same amount? HCA said no- s 5 (1) (a) also means that different sums can be given
against different tortfeasors, where one of them is liable for exemplary damages and
the others are not. The plumbers were only jointly liable for the $5000 compensatory
damages.

Contribution between concurrent tortfeasors

At common law, there was no contribution between wrongdoers or tortfeasors.

(Merryweather v Nixan, 1799)
[There was contribution at common law and equity where one person has discharged
a joint obligation like a debt or contract or guarantee, but not where a wrong had
been committed]

What is the difference between:

- a right to “contribution”

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- an “indemnity” or right to be indemnified?

Section 5 (1) (c) Law Reform Miscellaneous Provisions Act 1946 (NSW) provides:

(c) any tort-feasor liable in respect of that damage may recover

contribution from any other tort-feasor who is, or would if sued have
been, liable in respect of the same damage, whether as a joint tort-
feasor or otherwise, so, however, that no person shall be entitled to
recover contribution under this section from any person entitled to be
indemnified by that person in respect of the liability in respect of
which the contribution is sought.

Barwick CJ in Brambles Constructions v Helmers (1966) 114 CLR 213 at 217: “

The general purpose of the provision is clear enough. It would seem that the
legislature desired on the one hand to expose all tort-feasors who had caused
or contributed to the same damage to suit by the injured party
notwithstanding the recovery of judgment against any of them; and that each
tort-feasor who came under an obligation to pay damages should have
contribution from every other tort-feasor who had caused or contributed to
the same damage. But the draftsman chose words which have caused
considerable uncertainty as to what precisely the legislature has enacted.

The issues-

1. What is meant by “a person liable” ( A) ? Only someone found liable by a

court, or also someone who has been sued, or someone who has settled a
claim? All three. Any such person can seek a contribution.
2. What is meant by a person who “is liable or would if sued be liable” (B)?
What about if B is no longer liable because the P’s limitation period against B
has expired? Brambles Constructions v Helmers says that as long as B was
liable at any time to P, contribution may be sought from B (but there is also a
limitation period for the contribution proceedings).
3. What if B has had judgment entered for it because P sued B after the
limitation period had expired. B is not liable to contribution. James Hardie v
Seltsam
4. What if B settled P’s claim without admission of liability? A will have to prove
that B would have been liable. ( Amaca v NSW)

Section 5 (2) Law Reform Miscellaneous Provisions Act 1946 ( NSW) provides:
In any proceedings for contribution under this section the amount of the
contribution recoverable from any person shall be such as may be found by
the court to be just and equitable having regard to the extent of that person’s
responsibility for the damage; and the court shall have power to exempt any
person from liability to make contribution, or to direct that the contribution
to be recovered from any person shall amount to a complete indemnity.

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How does the court decide what is a “just and equitable” contribution? Note the
same principles apply as in the case of an apportionment for P’s “contributory
negligence” between P and a Defendant under Law Reform (Miscellaneous
Provisions) Act 1965.

See Podresebersek v Australian Iron and Steel Pty Ltd (1985) HCA (Cases on Torts
page 371/422 ): the apportionment process requires the court to consider and
compare two matters:
-the causative importance of the contribution of each party;
- the relative culpability of each party in the sense of the degree of departure
from the standard of the reasonable person.

In Wynbergen v Hoyts Corp Pty Ltd, HCA : Hayne J: “It is the whole conduct of each
negligent party in relation to the circumstances of the accident which must be
subjected to comparative examination.”

What factors are relevant to the comparison?

- that one party is a commercial profit-making entity and the other a
government funded by taxpayers?
- that one party is financially stronger than another?
- that one party apologised?
- that one party profited from the wrong and still has the profit?
- that one party was more actively engaged in the loss causing activity? (Yates v
Mobile Marine Repairs Pty Ltd )
- that one party was more able to prevent the loss than the other?
- that one party was deceitful in pursuit of monetary gain while the other’s
conduct fell short of appropriate level of professional skill? (Chandra v
Perpetual Trustees Victoria Ltd )

In Amaca P/L v NSW [2003] HCA 44, (discussed recently in Reinhold v NSW Lotteries
Corp ( No 2) [2008] NSWSC 187 at [54]]) the manufacturer of asbestos ( Amaca, a
James Hardie group company) sought contribution from the plaintiff’s employer
which was concurrently liable. The trial judge took into account that the
manufacturer had made “large profits from selling vast quantities of asbestos
products heedless of the dangers to others” and that what the manufacturer was
seeking was a contribution to a loss that flowed inevitably from those commercial
activities so that it would be borne in part “not out of James Hardie’s profits or risk
capital, but by the taxpayers of New South Wales.” He rejected the claim. The High
Court overturned the decision, saying that it was irrelevant to the apportionment
exercise that James Hardie was a commercial enterprise pursuing profit while the
State was a polity raising revenue by taxation.

Reinhold per Barrett J (in the context of apportionment for proportionate liability but
relevant to any apportionment): “… Financial strength or profitability is not to be
taken into account in assessing contribution or apportionment. Nor is ...the situation
or status of a party… The attitude of a wrongdoer in terms of remorse or lack of

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remorse is also irrelevant. The Dubai Aluminium case …raises an issue which, it
appears, has not received direct attention in Australia, that is, whether the fact that
one wrongdoer has profited from the wrongdoing and retains the profit may be
taken into account. I am of the opinion that, for the reasons stated…that fact, if it
exists, is inevitably relevant since .. it goes to the issue of responsibility…”

Further issues:

1. What if A settled P’s claim for too much? Bitumen Oil Refineries v GIO – this
can be taken into account by court when deciding what is a “just and equitable
contribution’ under s 5 (2).

2. P sues A and loss is assessed at $100. B would also have been liable to P but
had a liability or damages cap in place, of $25 maximum, either by legislation or
by prior agreement with P. Can A recover contribution from B for more than $25?
Unsworth v Commissioner for Railways (1958) HCA said no, where there is a
statutory cap on B’s liability, A can only recover up to the amount for which B
would be liable.

Should the same result apply where the limitation on B’s liability to A is
contractual?

Special rules on contribution and indemnity rights between employer

and employee
Where an employee E commits a tort in the course of employment by M, E is
personally liable to P for the tort. M is vicariously liable to P. They are thus joint
tortfeasors. What rights does M the employer have against E?
i) Contribution rights would apply between them under the 1946 Act.
ii) Common law indemnity right

In addition to the contribution rights, Lister v Romford Ice and Cold Storage, HL, 1957
imposed a contractual obligation to indemnify: holding that there is an implied term
in every contract of service that the employee E will not conduct him or herself
negligently so that the employer M is exposed to liability to third party P. If E does, E
has to indemnify M for any losses that M has to pay P.
Is this a fair allocation of loss?

Note: The employer’s insurers enforced this indemnity against the negligent
employee by exercising the insurers’ right to subrogation (stepping into the shoes of
the employer once they had paid out the employers’ claim).

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iii) But now see

*-Insurance Contracts Act 1984 (Cth) – (see statutory extracts in course

guide): what does this do?

*-Employees Liability Act 1991 (NSW)- this now protects employees in

NSW from this liability to indemnify or contribute to M as long as E was not
committing “serious and wilful misconduct” when committing the tort. See
sections 3 and 5 ((see statutory extracts in course guide)

What counts as “serious and wilful misconduct”?

In State of NSW v Eade , the court adopted the same meaning for these
words as they have been interpreted in the Workers Compensation Act ,
with Hoeben J quoting Sawle v Macadamia Processing Co Pty Limited
(1999) 18 NSWCCR 109 in which O’Meally J considered the meaning of
“serious and wilful misconduct” in s14(2) of the Workers Compensation
Act 1987:

“...conduct beyond negligence, even beyond culpable or gross negligence.

In order to establish serious and wilful misconduct, it must be
demonstrated that the person performing an act or suffering an omission
knows that it will cause risk of injury, or acts in disregard of consideration
whether it will cause injury. The word “wilful” connotes that the applicant
must have acted deliberately. As it seems to me, in order to establish
serious and wilful misconduct, a person accused of it must be shown to
have knowledge of the risk of injury and, in the light of that knowledge,
proceeded without regard to the risk.” Hoeben J found that the police
officer in Eade had committed serious and wilful misconduct when
making threats – that the plaintiff would be loaded up with heroin if he
did not confess- that rendered his subsequent arrest unlawful and his
prosecution malicious. He then allowed the State to claim an 80%
contribution from the police officer.

These notes are subject to copyright: Barbara McDonald, 2017

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