One Bird, Two Stones: High Court refuses to apply or extend vicarious liability to non-employee relationships

Written by Erica Taylor and Tiarna Scerri

On Wednesday, 13 November, the High Court delivered its long-awaited judgment on the matter of Bird v DP (A Pseudonym) [2024] HCA 41. Factually, the appeal concerned whether the Diocese of Ballarat was liable for historical sexual abuse perpetrated by an assistant priest.

The essential question of law was “whether, under the common law of Australia, absent a relationship of employment between a wrongdoer and a defendant, vicarious liability applies – or should be extended – to a relationship which is not one of employment, a relationship sometimes described as akin to employment” ([4]).

Preservation of Vicarious Liability Principle

The High Court held that, under Australian law, vicarious liability is limited to situations where an employment relationship exists. Contrary to the Supreme Court of Victoria’s interpretation of key precedental cases on vicarious liability, the High Court reinforced their construction of vicarious liability principle as being unable to apply to a non-employee relationship. Coffey was not an employee of the Diocese and thus vicarious liability could not be applied to this relationship, as it was in the Victorian Supreme Court. As emphasised by the majority judgment, "vicarious liability is concerned with attribution of liability, not fault" ([29]) and so the lower court also erred in using such language in their discussion.

Further, the High Court declined to extend the principle of vicarious liability to relationships ‘akin to employment’ involving authority or control. This finding reinforced the High Court’s majority view in favour of the preservation of vicarious liability doctrine as it stands.

Ramifications for non-profit and volunteer organisations

This judgment clarifies that the High Court does not support applying or expanding the common law principle of vicarious liability to organisations for actions by non-employees, even within structured hierarchies such as religious institutions or volunteer organisations.

This outcome places the burden on state and federal legislatures to ensure appropriate redress mechanisms for victims of historical institutional abuse, acknowledging the limitations of common law principles in addressing systemic, institutional wrongs when the perpetrator is not an employee.

Importance of Indirect Legislative Intent

This case serves as a reminder that while common law can evolve, it is still directly and indirectly influenced by legislative frameworks.

In its decision, the High Court acknowledged that the Legal Identity of Defendants (Organisational Child Abuse) Act 2018 (Vic) and the Wrongs Amendment (Organisational Child Abuse) Act 2017 (Vic) indirectly communicated legislative intent against expanding vicarious liability “beyond relationships of employment” that could not be ‘adapted’ ([71], [242]-[251]).

As Justice Jagot stated at [247]:

“It is one thing to accept that the common law should not stand still merely "because the legislature has not moved" to adapt to changing social conditions … but another to change a common law principle in circumstances where the legislature has responded to a comprehensive review of the common law's inadequacies by the enactment of statutory provisions which make no change to that common law principle.”

Although this consideration was not the sole reason for the rejection of the expansion of the vicarious liability principle, its inclusion does serve to demonstrate the scope of application and ongoing significance of legislative intent in the development of common law principles.

Gleeson J – A missed opportunity

Gleeson J did not agree with the plurality that relationships “akin to employment” do not attract vicarious liability and saw this case as “a missed opportunity for the Australian common law to develop in accordance with changed social conditions and in tandem with developments in other common law jurisdictions” ([79]).

While finding that the relationship between the Diocese and Coffey was capable of attracting vicarious liability, her Honour did find that the Diocese was not vicariously liable for the wrongdoing of Coffey because they occurred in circumstances where the assistant priest opportunistically took advantage of his role to commit them ([80]).

Conclusion

The High Court’s decision in Bird v DP solidifies the boundary of common law vicarious liability within Australian law, limiting it to formal employment relationships. It communicates a strong judicial message that attribution of organisational liability for non-employee actions is an issue to be addressed by legislative, not judicial, reform.