By Sonya Parsons, Partner, Luke Geary, Partner, Hudson Digby, Senior Associate and Evangeline McCowage, Paralegal

A full copy of the case can be accessed here.

Jurisdiction	High Court of Australia
Coram	Gageler CJ, Gordon, Edelman, Steward, Gleeson, Jagot and Beech Jones JJ
Date of Hearing	14 March 2024
Date of Judgment	13 November 2024
Applicant/Cross-Respondent	Bishop Paul Bernard Bird
Respondent/Cross-Applicant	DP (A Pseudonym)

Summary of the Decision

In what was perhaps a surprising decision to many practitioners in the historical abuse area, the High Court found that a diocese was not vicariously liable for the tortious actions of its priest because of the absence of an employment relationship.

The majority of the High Court considered that:

• vicarious liability is imposed for policy reasons for finding an employer liable for the conduct of their employee – however, the concept does not have a coherent basis developed through analytical jurisprudence and on clear and stable principles;
• on the current law in Australia true vicarious liability arises only out of an employer/employee relationship. Any finding that vicarious liability arises outside of that relationship requires an extension of the doctrine;
• the UK decisions concerning the extension of vicarious liability to relationships arising in a context of religious service, not employment, created doubt around the scope of vicarious liability, and led to further findings of vicarious liability in circumstances which were subject to criticism;
• if Australian courts were to extend vicarious liability to relationships ‘akin to employment’, it risks bringing uncertainty and indeterminacy as to which relationships can give rise to vicarious liability;
• the extension of vicarious liability to relationships ‘akin to employment’ had been considered by legislatures around the country following the Royal Commission into Institutional Responses to Child Sexual Abuse, and it had been extended, albeit prospectively only. In those circumstances the laws implemented around the country following the Royal Commission to make it easier for survivors to bring claims against institutions cannot be said to give rise to an intention to change the substantive law of vicarious liability (cf the Court’s findings re the laws governing permanent stay applications); and
• it is ultimately a matter for legislatures, not Australian courts, to extend the scope of relationships that can give rise to vicarious liability in Australia.

Key Takeaways

A short summary of the takeaways are:

• defendant religious entities are now likely to deny that they were in a relationship with tortfeasors that could give rise to vicarious liability. Notwithstanding that this was a Victorian decision on appeal, it has been applied in other jurisdictions;^[1]
• expect plaintiff and survivor organisations to press for legislative change. This is complicated as legislatures have already considered the issue following the Royal Commission and elected not to make those changes retrospectively;
• a comparison can be drawn with the High Court’s decisions in CFMMEU v Personnel Contracting Pty Ltd [2022] HCA 1, ZG Operations Australia Pty Ltd & Anor v Jamsek & Ors [2022] HCA 2 which concerned the (adjacent) issue of determining whether an individual is an employee or an independent contractor for the purpose of determining the benefits owing the employee. The High Court emphasised the importance of the terms of the written contract over the ‘totality of the relationship’ including how the contract is performed in practice. That position was subsequently amended to require consideration of the ‘totality of the relationship’ by the legislature through the insertion of section 15AA into the Fair Work Act 2009 (Cth), which commenced on 26 August 2024; and
• while much of the discussion will concern the threshold issue of whether the relationship between a diocese and a priest ought to give rise to vicarious liability, the judgment raises an issue as to the second question – whether the misconduct arose in the course of the individual’s role. Gleeson J, in her dissenting judgment, considered it appropriate to extend vicarious liability to relationships ‘akin to employment’, including as in the circumstances of this case. Nonetheless, she did not consider the priest’s misconduct to have occurred in the course of his role.

The Courts below – a recap

In 2020, the Plaintiff (DP) commenced proceedings in the Supreme Court of Victoria against the Catholic Diocese of Ballarat (Diocese) through the current Bishop, Bishop Paul Bird (Bishop Bird), claiming damages for psychological injuries he sustained as a result of the alleged assaults by an assistant priest, Father Coffey (Coffey). DP claimed that the Diocese was vicariously liable for the assaults committed by Coffey and also that the Diocese was directly liable in negligence as a result of the failure by the then Bishop of the Diocese to exercise reasonable care in his authority, supervision and control of the conduct of Coffey. In the first instance, the Court found that Coffey had committed the assaults that DP had alleged.

The question of vicarious liability took on significance in the proceedings in circumstances where Justice Forrest concluded that the Diocese was not negligent, as there was insufficient evidence to support a conclusion that the Diocese or the Bishop knew, or should have known, of the risk of harm posed to the Plaintiff. That finding did not go on appeal.

Having regard to the multifactorial approach of Hollis v Vabu [2011] HCA 8 the trial judge found that Coffey was not an employee of the Diocese. Nonetheless, and having the benefit of expert evidence given by a priest (Father Dillon) for the Plaintiff, the Court still found that the relationship between the Diocese and Coffey was capable of attracting vicarious liability. The Court of Appeal found specifically that:

• the rules of Canon Law and the formal structures that were in place allowed the Bishop to exercise control over Coffey;
• Coffey’s role, and the work he performed in undertaking that role, was necessarily and integrally interconnected with the fundamental work and function of the Diocese; and
• in discharging his duties in that role, Coffey was not acting independently of the Diocese, but as a representative of it,

and as such, Coffey was an emanation of the Diocese.

It is worth noting that where previous cases have typically distinguished between a relationship employer and employee (which can give rise to vicarious liability) and a principal and independent contractor (which cannot), the courts below had considered the relationship between a priest and diocese to have been ‘sui generis’ – that is, in a category of its own kind.

The Court of Appeal was also satisfied, applying the test in Prince Alfred College v ADC (2016) 258 CLR 134, that his role engendered Fr Coffey to local parishioners, and allowed him to achieve intimacy with them. In that regard the Court considered his social life as interwoven with his pastoral duties, as getting to know parishioners, in turn enables priests to better perform their pastoral duties or, to quote the Plaintiff’s expert, as a priest ‘you’re never really off duty’.

The High Court Decision

The appeal to the High Court concerned two issues:

• whether the Diocese was vicariously liable for Coffey’s misconduct. That issue is comprised of two questions, both of which must be answered in the positive for vicarious liability to be established:
  • was the relationship between the Diocese and Coffey of a kind which is capable of giving rise to vicarious liability; and
  • did the conduct occur within Coffey’s role in the Diocese (that is, having regard to the principles in Prince Alfred College); and
• whether the Diocese breached a non-delegable duty owed to DP. The High Court ultimately declined to consider this issue in circumstances where it had not previously been raised in either the first instance trial, or on appeal.

The majority (comprised of Gageler CJ and Gordon, Edelman, Steward and Beech-Jones JJ) found that the relationship between the Diocese and Coffey did not give rise to vicarious liability, as vicarious liability could only be found in an employer/employee relationship. In doing so the majority observed the difficulty with vicarious liability as conceptual. The rationale for its imposition is not identified by reference to ‘analytical jurisprudence’, or any ‘coherent basis’. It is imposed as a matter of policy so as to hold an employer (which will typically have the financial resources to meet a judgment) liable for the acts of an employee in the course of their employment. In the absence of ‘clear or stable’ principles on which vicarious liability is founded, the extension of vicarious liability beyond the confines of the employment relationship to those which are ’akin to employment’ would lead to uncertainty and indeterminacy as to what kinds of relationships do give rise to vicarious liability.

Much of the commentary that has followed the High Court’s decision has highlighted that Australia is out of step with the UK and Canada, when it comes to finding that vicarious liability arises out of relationship involving religious service, and not employment, particularly in the context of a historical child abuse claim. This is addressed head on by the majority in the decision, and their observations of the UK decisions contributed to their determination that any extension of the doctrine in Australia would lead to uncertainty and indeterminacy.

In particular, they observed that in the UK, while the Supreme Court found that vicarious liability could arise out of a relationship involving religious service (specifically, a brother of the Christian Brothers) – quite famously stating ‘[t]he law of vicarious liability is on the move’ that authority has subsequently been applied in decisions which are ‘difficult’ and subject to criticism, including as between a prison and a prisoner, and a local council and foster parents. They noted that there have been subsequent efforts by the UK Supreme Court to curtail the expansion of the scope of vicarious liability. A similar observation is made by Jagot J, who poetically refers to the same as ‘the high tide of vicarious liability appears to be in retreat’ in the UK.

The majority also considered whether the imposition of various legal regimes following the Royal Commission intended to allow survivors to overcome particular legal barriers to bring claims against institutions, particularly religious institutions, affected the doctrine of vicarious liability such as to expand the expand the scope of the same to include relationships ‘akin to employment’, particularly in Victoria. The same picks up the reasoning of the High Court in GLJ v The Trustees of the Roman Catholic Church for the Diocese of Lismore [2023] HCA 32, in which the Court determined that those changes affected the law concerning permanent stays. However, in this instance the Court found that as the issue of vicarious liability had been considered by legislatures, and expressly addressed by the imposition of prospective, not retrospective laws, it cannot be the case that they intended for the law of vicarious liability to be affected retrospectively.

The decision of the majority is ultimately relatively straightforward. Vicarious liability in Australia only arises out of an employee/employer relationship. Any extension of that principle is a matter for the legislature, not Australian courts.

In her dissenting judgment Gleeson J considered that it was appropriate for the High Court to extend vicarious liability to relationships that are akin to employment, and observed that it is not anomalous to impose vicarious liability for torts committed in the course of a relationship which possesses the same fundamental qualities as an employer-employee relationship. She was satisfied that the Diocese was capable of being vicariously liable for Coffey. However, she ultimately determined that it ought not to be, as the misconduct did not occur in the course of his role as an assistant parish priest – or, in the language of Prince Alfred College, it gave him the opportunity to harm the plaintiff, but was not the occasion for that harm.

The decision on vicarious liability comes as somewhat of a surprise, as the decision of the Victorian Court of Appeal has been followed in other jurisdictions, particularly in NSW, including in respect of other (albeit still religious), relationships.^[2] It may well be that such decisions reflected the start of the uncertainty and indeterminacy that the High Court sought to head-off.

Time will tell if the legislature responds to the decision with further reform.

[1] See TT v The Diocese of Saint Maron, Sydney & SS (No 3) [2024] NSWSC 943 [242]-[263]; and AA v Trustees of the Roman Catholic Church for the Diocese of Maitland-Newcastle [2024] NSWSC 1183 [193], [197]-[203]

[2] In TT v The Diocese of Saint Maron, Sydney & SS (No 3) [2024] NSWSC 943 Elkiam AJ found that the defendant was vicariously liable for the misconduct of a Sub-Deacon – several ‘orders’ lower than a priest