The Court of Appeal has reinforced the limits of vicarious liability, confirming that businesses will not usually be liable for the actions of a true independent contractor.
Background
In August 2018, Mr Burger sustained serious injuries following an assault by two door staff outside a JD Wetherspoon (“JDW”) public house. The door staff were employed by Risk Solutions BG Ltd (“Risk Solutions”), which had been contracted by JDW to provide security services. Risk Solutions entered into liquidation in October 2020 with no valid insurance, so Mr Burger pursued JDW on the basis that it was vicariously liable for the actions of the door staff. The claim initially succeeded at trial, but this decision was overturned on appeal in the High Court on the basis that Risk Solutions were a true independent contractor which contractually retained control over its staff and operated as a separate business to JDW. Mr Burger challenged this decision to the Court of Appeal.
The law
Where vicarious liability is alleged, the court will consider the following two stage test:
Is the relationship between the defendant and the tortfeasor one of employment, or one sufficiently akin to employment?
If so, was the wrongful act so closely connected with that relationship that it is fair and just to impose liability?
The first stage of this test was considered in the case of BXB v Trustees of the Barry Congregation of Jehovah’s Witnesses [2023] UKSC15, [2024] AC567 (“BXB”) and, more specifically, whether the relationship between defendant and tortfeasor was ‘akin to employment’. The features considered were pay, importance of the work in benefitting the defendant, control and hierarchical structure, although the message was clear that it is “important to recognise… that the ‘akin to employment’ expansion does not undermine the traditional position that there is no vicarious liability where the tortfeasor is a true independent contractor in relation to the defendant”.
The Supreme Court in Various Claimants v Barclays Bank plc [2020] UKSC 13 (“Barclays”) confirmed that the doctrine of vicarious liability does not ordinarily extend to the acts of independent contractors or their employees. Only where the relationship falls outside a true independent contracting arrangement does the court move on to consider the two-stage test. This case visited the definition of an ‘independent contractor’ as “a recognisably independent business of the tortfeasor or some other person” and “engaged in his own enterprise”.
The case of Hawley v Luminar Leisure Ltd [2006] EWCA Civ 18, [2006] PIQR P17 (“Hawley”) was one of remarkably similar circumstances to the present case; the claimant was assaulted by door staff who had been engaged by Luminar, a club owner. Luminar was treated as a “temporary employer” of the security staff because Luminar’s night manager was directing, supervising and instructing the door staff, with the doormen wearing Luminar uniforms and forming part of the hierarchy of the organisation. It was found that Luminar were vicariously liable for the actions of the door staff.
Decision
The Court of Appeal in this case held that the original trial Judge had adopted the wrong approach by proceeding directly to the first stage of the vicarious liability test (was the relationship “akin to employment”?) analysis without first asking whether Risk Solutions was operating as a true independent contractor. Lord Justice Newey assessed the Hawley case and factors set out in BXB, concluding that the contract was “entirely consistent” with Risk Solutions operating as a true independent contractor because:
Risk Solutions recruited, employed and managed its own personnel, supplying uniforms and training, and it accepted contractual responsibility for its employees’ conduct.
Risk Solutions provided security services as an independent commercial enterprise, with the prospect of profit, loss and freedom to supply its services to other clients.
It makes no difference that Risk Solutions was paid for its services, that those services were carried out for JDW’s benefit, or that services were important to JDW.
He added that the BXB factors are not a substitute for first determining whether the contractor is genuinely independent, and the facts of Hawley were exceptional and should not be treated as establishing a general principle applicable to outsourced security arrangements.
Lord Justice Newey reinforced the traditional view that where it is established that there is a true independent contractor, vicarious liability will not arise, and the two-stage test need not be assessed.
Comments
This decision underlines the importance of ensuring that contractual agreements with independent contractors are clear and unambiguous in relation to control and responsibility for the actions of the independent contractor and/or its employees. Independent management, separate insurance, contractual allocation of risk, and/or the contractor carrying on business for profit remain highly persuasive.
Whilst the decision does not entirely rule out vicarious liability in all cases involving independent contractors (with circumstances similar to Hawley being one such scenario where it could still apply), this decision means its application in such claims should now be extremely rare.
The case was reported as Burger v Risk Solutions BG Ltd & J D Wetherspoon plc [2026] EWCA Civ 804 and the judgement can be found here.
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