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    UK: Supreme Court Child Abuse Ruling Has Important Implications for Insurance Industry

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    The Supreme Court has for the first time confirmed the existence of dual vicarious liability in the landmark ruling of The Catholic Child Welfare Society and others v Various Claimants (FC) and The Institute of the Brothers of the Christian Schools and others [2012] UKSC 56.

    The case concerned a group action by 170 men alleging physical and sexual abuse suffered at the hands of Brothers who taught at St William's School between 1958 and 1992. There were two sets of defendants:

    (1) representatives of the Middlesbrough Diocese (the Middlesbrough Defendants) who managed the school and held employment contracts with the Brothers; and
    (2) the De La Salle Institute of Brothers of Christian Schools (the Institute) to which the Brothers were bound by oath and which required the Brothers to take up specific teaching posts in furtherance of its mission.

    At First Instance and in the Court of Appeal, the Middlesbrough Defendants were found to be solely vicariously liable for the Brothers' conduct because they had employed the Brothers. However, in a unanimous decision of the Supreme Court, the Institute was held to be dually vicariously liable for the abuse along with the Middlesbrough Defendants.

    According to Lord Phillips, despite the absence of an employment contract, the relationship between the Institute and the Brothers had "all the essential elements of the relationship between employer and employees." Moreover, there was a sufficiently close connection between the relationship and the acts of abuse.

    This decision indicates that despite the absence of an employment contract, an organisation could be vicariously liable for the torts of another organisation's employees. Insurers should take heed and thoroughly scrutinise such relationships, whether or not there is an employment contract, with particular regard to the level of control that an organisation has over an individual.

    The Supreme Court judgment can be viewed here.

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