The Court of Appeal have handed down judgment in Hughes v Rattan  EWCA Civ 107, upholding the Claimant’s case that the Defendant (the principal dentist) owed her a non-delegable duty of care despite never having treated her himself. The Court however disagreed with the decision of the High Court judge, in obiter, on the issue of vicarious liability. Lord Justice Bean set out a number of factors which should be considered when assessing the relationship between a principal and an associate, and whether it is “analogous” with that of employment. He stated that in this case, the Court did not believe the criteria set out in Barclays had been satisfied and as such the Defendant was not vicariously liable for the actions of the associates.
The Claimant was a patient of the Practice between August 2009 and December 2015. During this time, she underwent treatment by six different dentists for NHS treatment. The Claimant alleged that the treatment provided by four of these dentists was negligent. One of the dentists was a Foundation Dentist who was employed by the practice under a contract of employment and the vicarious liability of the Defendant was admitted for this dentist. The three other dentists were self-employed associates engaged by way of associate agreements which explicitly stated that the agreement was not intended to create an employer/employee relationship. Each dentist was providing treatment under a General Dental Services Contract and each one personally held professional indemnity cover for negligence claims.
High Court Decision
On appeal, the High Court upheld the decision of the County Court judge, dismissing the Defendant’s appeal stating that the judge was “clearly right” to hold that the Defendant was under a nondelegable duty of care to the Claimant in respect of the treatment she received at the practice. Given this, the judge was then led to consider whether the relationship between the Defendant and the associates was, “sufficiently akin to employment to make it fair and just to impose vicarious liability”. In considering this relationship the judge considered the precedents set in Barclays Bank  UKSC 13 and Christian Brothers, interestingly, the judge stated that the sheer fact that the associates were self-employed, responsible for their own tax and national insurance and not in receipt of the kinds of benefits that would be received by employees does not answer the question one way or the other. The judge was of the view that the pertinent question in this case is whether the associates were working as part of their own independent businesses or working as an integral part of the Defendant’s business when they provided the treatment to the Clamant. After setting out the issues she considered in reaching her conclusion, the judge ultimately decided that the associates were providing dental treatment as an integral part of the Defendant’s dental practice and the judge dismissed the Defendant’s appeal.
Court of Appeal Decision
The Defendant appealed to the Court of Appeal. Here, the Court held that the Claimant had satisfied the criteria set out in Woodland v Swimming Teachers Association and others  UKSC 66 and as such, the Defendant owed her a non-delegable duty of care. The appeal was dismissed making it unnecessary to decide on the second ground of appeal being the vicarious liability issue, however, in appreciating the nature of a test case, the Court did go on to consider the vicarious liability issue and whether the relationship between the Defendant and the associates was one akin to employment. Lord Justice Bean said that whilst the decision was taken with some hesitation, his view differed from the judge on the issue of vicarious liability, stating that she had placed too much weight on the factors pointing toward an employment relationship and placed too little weight on the factors which pointed the other way. These factors included:
- The fact the associates were free to work for as many or as few hours as they wished
- The associates were free to work for other practices;
- The Defendant had no right to control clinical judgment of the associates;
- The associates chose which laboratories to use and shared the cost of disbursements to those laboratories;
- The associates were responsible for their own tax and national insurance and were considered to be “independent contractors” for the purposes of HMRC;
- The associates shared the financial risk of bad debts with the Defendant;
- The associates were required to indemnify the Defendant for claims made by patients of the associates;
- The associates were required to pay for their own professional clothing and development, and for any equipment they wished to use which was not provided by the practice; and
- There was no disciplinary procedure.
Whilst noting the factors previously set out by the judge which pointed towards a relationship akin to employment, LJ Bean opined that these indicators did not outweigh those listed above so as to make the relationship “sufficiently analogous” to employment to satisfy the Barclays test.
What does this mean?
Whilst the decision of the High Court judge in 2021 unsettled indemnifiers and principal dentists alike, the Court of Appeal seems to have attempted to curtail the previous decision somewhat, holding that whilst the Defendant did owe the Claimant a non-delegable duty of care, all of the circumstances around the engagement of the associates must be considered and appropriate weight given to each before a principal can be held vicariously liable for the associates acts or omissions. In this particular case, the Defendant was held not to be vicariously liable.
While great care has been taken in the preparation of the content of this article, it does not purport to be a comprehensive statement of the relevant law and full professional advice should be taken before any action is taken in reliance on any item covered.