In the decision of CCIG Investments Pty Ltd v Schokman [2023] HCA 21 (handed down on 2 August 2023) an employer was found not to be vicariously liable for the conduct of one of its employees when he urinated on a fellow employee who was sleeping in their shared staff accommodation. The unanimous decision overturned the earlier decision of the Queensland Court of Appeal which had found the employer vicariously liable. The High Court ultimately found the actions of the employee could not be said to have occurred in the course or scope of his employment.
Key Facts
Mr Schokman (the Respondent) was employed as a food and beverage supervisor with the appellant at Daydream Island Resort and Spa in the Whitsunday Islands. The terms of his employment contract included that due to the fact his position required him to live on the island, the appellant (his employer) would make accommodation available to him at a discounted rate. As part of the arrangement, he was required to live in the shared accommodation with a co-worker, Mr Hewett.
On the night of the incident, both employees had spent some time in the staff bar after finishing work at the restaurant. The Respondent left around 1:00am and returned to his room. Mr Hewett returned to their shared accommodation shortly afterwards. After a short discussion, Mr Hewett left the unit, taking some drinks with him. Mr Hewett then returned about 3:00am. The Respondent heard him vomiting in the bathroom. Around 30 mins later the Respondent was woken up in a distressed condition unable to breath. Mr Hewett was standing over the Respondent’s bed, urinating on the Respondent, who was inhaling the urine and choking. The Respondent suffered a catapletic attack (sudden and brief loss of voluntary muscle tone triggered by emotional stress) as a result of the incident.
Court’s Consideration
The Court applied the well-established common law rule that for an employer to be held vicariously liable for an employee’s conduct, the central question is whether the tortious act was committed in the scope or course of that person’s employment. Ultimately this question is answered having regard to the particular circumstances of each case. However, as the Court recognised, this is not necessarily an easy task.
In considering what is conduct that falls within ‘the course or scope of employment’, the High Court noted the following [at 15]:
- it is the nature of what the employee is employed to do on behalf of the employer that determines whether wrongdoing is in the scope of employment;
- this requires the identification of what the employee was actually employed to do and held out as being employed to do;
- such an enquiry requires consideration of the conduct of the parties subsequent to the contract that establishes their relationship, especially the conduct of the person whose actions have caused the injury; and
- aspects of the course or scope of employment may be “functional, geographical, or temporal”.
The Court recognised that it would be unjust to make the employer responsible for every act the employee chooses to do. In particular, an act done by an employee when they are on a “frolic of their own” will not attract liability. The question is therefore whether there is a sufficient connection or nexus between the employment enterprise and the wrongful act. If all that can be pointed to is that the employment provides an “opportunity” for the employee’s wrongful act to take place, the connection with the employment is tenuous (at [33]). The Court found that such a situation can be distinguished from other factual scenarios (such as child sexual abuse in a school or other institution) that may take place. In such situations where an employer has assigned a special role to an employee which provides them with authority, power, trust, control and the ability to achieve intimacy, there is a stronger connection between the employment and the wrongful act.
The Respondent in this matter in defending the appeal attempted to draw an analogy from such factual scenarios (child sexual abuse in educational settings) to say that the shared staff accommodation made him vulnerable as he was required to sleep in a setting that was intimate. The Court dismissed this argument and found that Mr Hewitt was not assigned any special role concerning Mr Schokman and no part of what Mr Hewett was employed to do was required to be done in the accommodation. The highest it could be put was that the shared accommodation created a physical proximity between the two men. It did provide the opportunity for Mr Hewett’s drunken actions to take place, but as the cases have found, mere “opportunity” provides an insufficiently strong connection with the employment to establish vicarious liability (at [35]-[37]). Furthermore given Mr Hewitt was on a break from work, in his leisure time, and not carrying out his employment duties, the “functional, geographical, and temporal” aspects of Mr Hewett’s course or scope of employment were absent.
Decision
Ultimately, the Court found that Mr Hewett’s negligent actions were not closely connected with any of his duties or powers of his employment. He couldn’t have been said to be acting in the course or scope of his employment, it therefore followed that the employer could not be held vicariously liable for his actions.
It will be interesting to see how any future actions for vicarious liability in the FIFO industry, where staff routinely share accommodation, draw on the findings arrived at by the High Court in this decision.
The High Court’s full judgement is available here.
The High Court’s Judgement Summary is available here.
