Case Note: Clancy v Plaintiffs A, B, C and D; Bird v Plaintiffs A, B, C and D [2022] NSWCA 119

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By Luke Geary, Partner and Sara Taylor, Lawyer

Factual Summary of the Primary Case: A, B, C, D v Bird, Clancy and Little Pigeon Ltd/as Footprints Childcare Centre [2020] NSWSC 1379

Abuse setting Footprint Childcare Centre (Footprints)
Abuse date 2008 – 2010
Alleged perpetrator Mr Rodney Bird, who held 1% of shares in Little Pigeon Pty Ltd, the licensee of Footprints, and was also an employee of Footprints
Nature of abuse Mr Bird engaged in inappropriate conduct of a sexual nature that included various types of contact sexual abuse.
Damages awarded Damages were awarded to the four plaintiffs in the sums of $1,008,378.55; $465,000; $508,677.71 and $455,000 respectively against Ms Clancy, Little Pigeon and Mr Bird.

Case details

Jurisdiction New South Wales Court of Appeal
Date of judgment 6 July 2022
Bench Bell CJ, Gleeson JA, Brereton JA
Appellants Ms Lisa Maree Clancy (Ms Clancy), Little Pigeon Pty Ltd (Little Pigeon) t/as Footprints Childcare Centre (Footprints), and Mr Rodney Raymond Bird (Mr Bird)
Respondents Plaintiffs A, B, C, and D

Background

Little Pigeon was the licensee of Footprints. Ms Clancy held 99% of the shares in Little Pigeon and was its director, whilst her father, Mr Bird, held the remaining 1% of shares, worked at Footprints as a cook, occupational health and safety officer and first aid officer, and performed maintenance works at the Centre.

The primary judge held that Mr Bird had repeatedly kissed B, including with an open mouth, and pulled down her pants whilst at Footprints. In relation to D, the primary judge accepted as true D’s disclosures that Mr Bird had tickled her on her underwear, over her objection, and touched her tummy. In addition to the body of tendency evidence, the primary judge reached these conclusions in reliance upon the evidence of B and D on their own claims, the evidence of A and C as to perceived changes in the behaviour of their children and adverse findings as to the credibility of Mr Bird and Ms Clancy.

The primary judge also held that Little Pigeon and Ms Clancy were vicariously liable for Mr Bird’s conduct, on the basis that Mr Bird was in fact an “employee” at Footprints, and had therefore breached a duty of care owed to all of the Respondents. After analysing the totality of the relationship between Little Pigeon and Mr Bird, consistent with Hollis v Vabu Pty Ltd [2001] HCA 44 at [43]–[45], her Honour found that Mr Bird was an employee, even though he was not paid wages for this work and was represented to be a volunteer. Her Honour found that even if Mr Bird were not an employee, she could see no reason, in principle, why there should not have been vicarious liability for his acts given the tests discussed in Prince Alfred College Incorporated v ADC [2016] HCA 37.

Ms Clancy and Little Pigeon were also held directly liable to each of the Respondents in negligence, on the basis that they had failed to ensure that Mr Bird was “accompanied” by primary contact staff when in the presence of children at Footprints, in accordance with Little Pigeon’s internal policies as well as cl 57 of the Children’s Services Regulation 2004 (NSW) (the Regulation). It was held that, if they had done so, then the sexual assaults of B and D would not have occurred or would have been reported. Little Pigeon was additionally held liable to A and C for breach of contract.

Issues on appeal

The Appellants appealed almost every aspect of the primary judge’s decision as to both liability and damages, including a significant number of material factual findings.

The principal issues on appeal included aspects regarding the admissibility of various pieces of evidence, whether the primary judge erred in concluding the children’s disclosures met the Briginshaw requirements, whether Ms Clancy and Little Pigeon were directly liable in negligence, whether Ms Clancy was vicariously liable for Mr Bird’s acts and whether there was an error in the assessment of damages.

The Decision

The Court allowed the appeals, set aside the orders of the primary judge, and remitted the proceedings relating to two of the Plaintiffs to the Common Law Division.

The two proceedings (in relation to C and D) that were remitted, were done so on the findings that:

  • The primary judge erred in concluding that Child 2’s[1] disclosures to their mother were sustained to the Briginshaw standard, such that they were an unreliable basis for supporting the tendency asserted in support of D’s claim. The disclosures of Child 2 were marked by inconsistency, which was reinforced by the inability to cross-examine the child (due to the child having been so young at the time of disclosure and having no recollection of it), and the inadmissibility of the body of cross-tendency evidence relied upon in relation to it;
  • The primary judge’s reasoning as to D’s disclosures of abuse to their mother (C), was vitiated by the wrongful admission of Child 1’s[2] evidence and the erroneous characterisation of Mr Bird’s “admissions” to police; and
  • The Court considered that it was not in a position to determine whether D’s disclosures were established to the requisite standard, because this question would be affected by considerations of credibility. Therefore, it followed that C and D’s claims must be remitted to the Common Law Division for determination by a judge other than the primary judge.

Most notably though are the findings in relation to direct and vicarious liability. The Court found that the primary judge erred in finding Ms Clancy and Little Pigeon directly liable in negligence. Further, the Court found that vicarious liability could only be attributed to Little Pigeon due to its status as Mr Bird’s employer, rather than both Little Pigeon and Ms Clancy as dual vicarious liability has not yet been adopted in the common law of Australia.

The matter of vicarious liability for Mr Bird generally (and whether he was a volunteer or employee) was not put in issue in the appeal and there is nothing to suggest that the Court disagreed with the primary judge’s assessment that he was effectively an employee (referring to him as an employee throughout the appeal judgment). There was no commentary as to the primary judge’s comments regarding Prince Alfred College and volunteers.

The Court found the following; –

As to direct liability

The requirement, in cl 57 of the Regulation, that a volunteer be “accompanied” when in the presence of children is directed to the supervision and care of children, rather than the supervision of volunteers. Thus, when a volunteer is in the presence of children, a member of the primary contact staff must also be in their presence. This means no more than that children are not to be under the supervision of a volunteer alone. The primary judge therefore erred in construing cl 57 as requiring that a primary contact staff member be “alongside” Mr Bird.

The primary judge erred in concluding that there was insufficient supervision of Mr Bird’s contact with children at Footprints, having regard to the substantial body of unchallenged evidence of Little Pigeon’s policies and procedures, the evidence of Footprints’ employees, and the lack of any internal complaints regarding Mr Bird’s conduct. It followed that Ms Clancy and Little Pigeon were not directly liable to the Respondents in negligence.

As to vicarious liability

The primary judge found Little Pigeon and Ms Clancy to be vicariously liable for Mr Bird if he was found to be an employee. In finding that Little Pigeon was vicariously liable for Mr Bird’s conduct, her Honour summarised her reasons at [450]:

  • The actual roles which Little Pigeon assigned Mr Bird, which placed him in a position of considerable power and trust, which he abused;
  • That those roles gave Mr Bird the opportunity to have the close contact with children which he, Ms Clancy and other witnesses described
  • The authority Mr Bird was given by effectively being left unsupervised when he had such contact, which he also abused;
  • This lack of supervision permitting him to not only achieve intimacy with his young victims, but to control them while committing the wrongful acts he admitted and his victims disclosed; and
  • It was Mr Bird’s performance of the roles he was given, which created the occasion for his wrongful acts.”

On a fair reading of the primary judge’s reasons, her Honour did not find that Ms Clancy was vicariously liable for Mr Bird’s conduct at Footprints. In any event, there was no sound reason for imputing vicarious liability to Ms Clancy in circumstances where Little Pigeon’s status as Mr Bird’s employer was a well-established basis for its vicarious liability.

The principle of dual vicarious liability has not been adopted in the common law of Australia, noting the following case law:

Oceanic Crest Shipping Company v Pilbara Harbour Services Pty Ltd (1986) 160 CLR 626; [1986] HCA 34; Viasystems (Tyneside) Ltd v Thermal Transfer (Northern) Ltd [2006] QB 510; and Day v The Ocean Beach Hotel Shellharbour Pty Ltd (2013) 85 NSWLR 335; [2013] NSWCA 250.

The Respondents submitted that Ms Clancy has coextensive vicarious liability with Little Pigeon because Ms Clancy “as the licensee and authorised supervisor of the centre … was able to exert the same level of control and Mr Bird’s employer, namely the centre”. The Respondents said the “just outcome” must be that of dual vicarious liability.

Moreover, contrary to the Respondents’ oral submissions, the Plaintiffs’ case at trial was not run or argued on the basis that Ms Clancy was vicariously liable for Mr Bird’s conduct; the Plaintiffs’ written opening made plain that the vicarious liability case was only advanced against Little Pigeon.

Further, counsel for the Respondents did not refer to any Australian authority approving the principle of dual vicarious liability. Nor was any attempt made in submissions to cast doubt on the statements by the High Court inconsistent with the possibility of dual vicarious liability in Oceanic Crest Shipping Company v Pilbara Harbour Services Pty Ltd and the other relevant case law mentioned above.

The Respondents also sought to distinguish the ratio decidendi of Day v The Ocean Beach Hotel Shellharbour Pty Ltd (Ocean Beach Hotel), where it was said that is not possible for any court, other than the High Court, to adopt the theory of dual vicarious liability where two different persons had control over a tortfeasor.

Like in Ocean Beach Hotel, there is a well-established basis of vicarious liability in this case, being that of the employer (Little Pigeon) for the tortious conduct of its employee (Mr Bird) in the course of his employment, and there is no sound basis for imputing vicarious liability to another person, such as Ms Clancy, who did not have a contractual relationship with the wrongdoer, Mr Bird.

To further reiterate above, the principle of dual vicarious liability has not been adopted in the common law of Australia. It appears from this judgment that the Court remains of a mindset not to adopt this principle.

Practical Points for Future Institutional Abuse Claims

With regard to the admissibility and use of tendency evidence, practically speaking, it is important that such evidence have a well-founded and reasonable basis. In this case, it was based on the evidence of young children, some of whom could not later be cross-examined, and the misinterpreted admissions of Mr Bird. This led to inconsistency and unreliability of evidence, which as noted above, was wrongfully admitted, interpreted or relied upon.

On the notion of direct liability, and particularly in a case such as this where there were stringent policies and procedures in place, the mere fact the abuse was able to have occurred does not infer such policies were not in operation at the relevant time. Instead, in order to determine direct liability, consideration and weight must be given to a range of evidence including witness statements and examples of enforcement of policies, as was done so in this case.

Importantly, this judgment has confirmed that the principle of dual vicarious liability is not established nor accepted under Australian common law. This was found in line with the case authorities mentioned above, including Ocean Beach Hotel.

[1] Child 2 was a child who attended Footprints at the relevant time but was not a party to the proceeding.

[2] Child 1 was another child who attended Footprints at the relevant time but was not a party to the proceeding.

For further information, please do not hesitate to contact us.

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