The Court of Appeal considered an appeal against a finding that a football club was liable for the sexual abuse inflicted on a 13-year-old youth player in 1987 by a volunteer scout (Mr Roper) during a tour of New Zealand, and further that the primary limitation period should be disapplied under s.33 of the Limitation Act 1980. At the relevant time the club’s financial situation was dire and, as a result, it could only afford to employ a minimum number of staff and was dependent upon volunteers for functions which might, in a bigger or better funded club, have been performed by paid employees. The trial judge had found that “Identifying, recruiting and retaining the allegiance of promising young footballers was…part of the core business of the club.” The volunteer scout in question was held by the trial judge to have had a “particular role in spotting promising players below the minimum schoolboy signing age of 14, taking them under his wing, coaching and watching them… and encouraging them to form an allegiance to Blackpool FC before the time came when they might (if good enough) be formally signed up.” With regards to the tour of New Zealand the Court of Appeal noted that it was not billed or described as a Blackpool FC trip, and there was no evidence that Blackpool FC as such had any involvement in the planning, running, administration or financing of the trip other than the contribution of £500, or had endorsed, still less adopted the tour. The trial judge had recorded witness evidence to the effect that either the, or a, primary purpose of the Thailand leg of the trip was for the scout to recoup his outlay on the tour by purchasing counterfeit sports goods which he would then sell in England.
The Claimant argued that Blackpool FC’s relationship with the scout was akin to employment as the club had caused or permitted him to hold himself out as a representative of the club and derived benefit from the relationship by using him as a source of young footballing talent. The club created the risk that the scout would take advantage of the opportunity afforded by his employment to abuse the Claimant.
Vicarious Liability principles
Stuart-Smith LJ began his review of the relevant principles by stating that the focus is on whether there was a true relationship of employment between D1 and D2, and whether D1 was acting in the course of employment when he committed the relevant tort. Further, he quoted Clerk and Lindsell to the effect it was and remained established that “if the employer has employed an independent contractor to do work on his behalf, the general rule is that the employer is not responsible for any tort committed by the contractor in the course of the execution of the work. Furthermore, since the employees of the contractor, whilst acting as such, stand in the same position as their employer, it is equally the case that the employer of the contractor is not liable for the torts committed by the contractor’s employees.”
Stuart-Smith LJ referred to the various relevant leading decisions since 2012 and distinguished between those where there was a conventional employer/employee relationship (Mohamud v WM Morrison Supermarkets plc  UKSC 11, and Various Claimants v WM Morrison Supermarkets plc  UKSC 12 from those where there was not (Various Claimants v Catholic Child Welfare Society  UKSC 56, Cox v Ministry of Justice  UKSC 10, Various Claimants v Barclays Bank plc  UKSC 13, and BXB v Watch Tower and Bible Tract Society of Pennsylvania  EWCA Civ 356).
He noted that following Christian Brothers it had become conventional to approach the issue adopting the two-stage test of considering the relationship between D1 and D2 to see whether it is one that is capable of giving rise to vicarious liability and also examining the connection that links the relationship between D1 and D2 and the tortious act or omission of D1 – “recognising that resolution of the issue involves a synthesis of the two stages.”
Stuart-Smith LJ cited the familiar passage from Lord Phillips’s judgment in Christian Brothers setting out the policy reasons that “…usually make it fair, just and reasonable to impose vicarious liability on the employer when these criteria are satisfied: (i) the employer is more likely to have the means to compensate the victim than the employee and can be expected to have insured against that liability; (ii) the tort will have been committed as a result of activity being taken by the employee on behalf of the employer; (iii) the employee’s activity is likely to be part of the business activity of the employer; (iv) the employer, by employing the employee to carry on the activity will have created the risk of the tort committed by the employee; (v) the employee will, to a greater or lesser degree, have been under the control of the employer.”
He went on to note that Lord Phillips had identified that the modern significance of control was that an employer could direct what an employee does, not how he does it, and that Lord Phillips had endorsed the approach of Rix LJ in Viasystems (Tyneside) Ltd v Thermal Transfer (Northern) Ltd  EWCA Civ 1151, namely that liability might arise where an employee was “an integral part of [the employer’s] business” or “embedded in [the employer’s] organisation”.
Stuart-Smith LJ referred to the consideration of the connection test in both Christian Brothers and Lister v Hesley Hall Ltd  UKHL 22 as establishing:
“…two important points. First, the fact that an employer’s enterprise creates a foreseeable risk and gives the employee the opportunity to commit sexual abuse is not sufficient to justify the imposition of vicarious liability on the employer. Second, the additional feature that justifies the distinction between the groundsman and the warden of the residential home is that the warden has been employed to discharge the school’s responsibilities to the children who have been entrusted by the employer to his care.”
Stuart-Smith LJ also referred to Lord Phillip’s judgment in Christian Brothers referring to the close connection test whereby vicarious liability is imposed where “a defendant, whose relationship with the abuser put it in a position to use the abuser to carry on its business or to further its own interests, has done so in a manner which has created or significantly enhanced the risk that the victim or victims would suffer the relevant abuse. The essential closeness of connection between the relationship between the defendant and the tortfeasor and the acts of abuse thus involves a strong causative link.” He commented that the significant features of Lord Phillips’s formulation:
“…go beyond the simple requirement of a “strong” or “close” connection between the risk created by the employer’s enterprise and the wrongful act. In addition, the formulation involves (a) “placing” the abuser in their position, (b) using them to carry on its business, and (c) thereby significantly increasing the risk created by the employer’s enterprise. Both (a) and (b) imply a degree of control and direction of the abuser by the “employer”.
With respect to the facts of Christian Brothers he held that the element of control was “central to Lord Phillips’ analysis and conclusion. The institute’s control of the individual brothers was complete: it directed the individual brothers to teach at the school (i.e. what they should do) and dictated their conduct when there (i.e. how they should do it).”
Stuart-Smith LJ next referred to Cox and described it as providing clarification in respect of control and developing the law through the significance of the assigning of work by D2 to D1. With respect to control, he held that Lord Reed in Cox should be interpreted as saying that:
“…the presence or absence of an ability to direct how an individual did his work is unlikely to be of independent significance in most cases….the presence or (particularly) absence of control is a material consideration for a court deciding whether or not to impose strict vicarious liability upon D2. It is, in my view, always to be borne in mind as a potentially material consideration when deciding whether to extend vicarious liability by incremental analogy from the safe confines of an employer/employee relationship.”
He cited Lord Reed’s summary of stage 1: “a relationship other than one of employment is in principle capable of giving rise to vicarious liability where harm is wrongfully done by an individual who carries on activities as an integral part of the business activities carried on by a defendant and for its benefit (rather than his activities being entirely attributable to the conduct of a recognisably independent business of his own or of a third party), and where the commission of the wrongful act is a risk created by the defendant by assigning those activities to the individual in question.”
Stuart-Smith LJ referred to Morrison 1 and noted that:
“…there must be a sufficient (i.e. strong/close) connection between the position in which he was employed and the employee’s wrongful conduct. The decided cases show that this second question is highly fact-sensitive and requiring of detailed scrutiny. Where it is proposed to extend the imposition of vicarious liability beyond its traditional bounds, the rigour to be attached to the second question (as well as to the first) must, in my judgment be even greater because notions of entrusting functions, assigning work, and the extent of the “employer’s” control are likely to be more fluid than in a conventional employer/employee relationship. Third, and quite apart from the distinction between those relationships that are akin to employment on the one hand and akin to independent contracting on the other, it is always to be remembered that it is not sufficient simply to provide the “employee” with the opportunity to commit the tort.”
Stuart-Smith LJ considered that Barclays and Morrison 2 had adopted a more restrictive approach than Morrison 1 and Armes, and cited Lady Hale’s identification in Barclays of the question being “whether the tortfeasor is carrying on business on his own account or whether he is in a relationship akin to employment with the defendant. In doubtful cases, the five “incidents” identified by Lord Phillips may be helpful in identifying a relationship which is sufficiently analogous to employment to make it fair, just and reasonable to impose vicarious liability. Although they were enunciated in the context of non-commercial enterprises, they may be relevant in deciding whether workers who may be technically self employed or agency workers are effectively part and parcel of the employer’s business. But the key, as it was in [the Christian Brothers’ case, Cox’s case] and Armes … , will usually lie in understanding the details of the relationship. Where it is clear that the tortfeasor is carrying on his own independent business it is not necessary to consider the five incidents.”
Stuart-Smith LJ held that as matter of principle the final sentence in that summary was applicable to stage 1 and to stage 2 as it was entirely possible for there to be a relationship between D1 and D2 which would in principle be capable of giving rise to vicarious liability but for the tortious acts in question to fail to satisfy stage 2 because, when committing the acts, D2 was acting “on his own independent business.”
Stuart-Smith concluded his summary of the development of vicarious liability by holding that “Where an employer/employee relationship is lacking there is a broad spectrum from those which are, in reality, only technically different from a conventional employer/employee relationship to those which are readily identified as being either true independent contractor/employer relationships or relationships that have essentially the same characteristics.” The need for Lord Phillips’s five criteria is in doubtful cases to help identify the relationship that is sufficiently analogous to employment to make it fair, just and reasonable to impose vicarious liability albeit those criteria cannot provide definitive outcomes. Nevertheless it was material that:
“101.… that the journey towards extending the scope of relationships where vicarious liability should be imposed beyond conventional employer/employee relationships is substantially based upon the approach of Rix LJ to dual vicarious liability in Viasystems and the approach of the Canadian courts, with particular reference to Bazley v Curry, which have as their hallmarks features of control, enterprise risk and integration of the tortfeasor into the business. Where the relationship is such that the “employer” is not even in a position to direct what the tortfeasor shall do, as Lord Reed held at  of Cox’s case, “the absence of even that vestigial degree of control would be liable to negative the imposition of vicarious liability.” The same idea is implicit in Lord Reed’s reference (at  of Cox’s case) to the defendant creating a risk by assigning particular business activities to the tortfeasor: see also  of Cox’s case.
102. Questions of vicarious liability will generally not arise unless the tortfeasor can be described as doing something for, or for the benefit of, the “employer” or their enterprise. That will therefore seldom be a determinative characteristic. More is required, both at stage 1 and stage 2, than that the “employer” has engaged the tortfeasor to carry out work which gave them the opportunity to commit the tortious acts in question. To my mind, the authorities suggest that it is the combination of the creation of enterprise risk inherent in the employer’s “business”, combined with the measure of control (if only in assigning the tortfeasor to roles that significantly enhance that risk), that will frequently provide the touchstone for the synthesis of stage 1 and stage 2. That of itself necessitates a close examination of the relationship between the tortfeasor and the person upon whom vicarious liability may be imposed, both when addressing whether their relationship is one which is capable of giving rise to vicarious liability and when considering whether the connection that links the relationship between D1 and D2 and the tortious act or omission of D1 is sufficient to justify the imposition of vicarious liability on the facts of the particular case.
103. I would add that there is a risk that the phrase “integral to” may be used loosely in circumstances where it adds little or nothing to the observation that the primary tortfeasor has been performing one or more functions that are beneficial to the “employer’s” enterprise. To my mind, there is a strand running through the cases from Viasystems onwards which suggests that what one should look for is not merely a beneficial involvement with (or for) the “employer’s” enterprise but a real degree of integration of the primary tortfeasor into the employer’s business or relevant activity. This is not capable of hard-edged definition in advance; but it may in appropriate cases provide an additional marker when seeking to distinguish between relationships that are properly to be regarded as “akin to employment” and those that are not. Integration in this sense may be seen to be present on the facts of the Christian Brothers’ case, Cox’s case, Armes and BXB but to be absent Barclays’ case.
104. As has been recognised on numerous occasions, stages 1 and 2 are not susceptible to a “tick-box” approach; nor do the statements of principle to which I have referred provide a precise definition that can simply be applied so as to give a ready answer when the question of vicarious liability arises beyond the safe confines of an employer/employee relationship. It is for that reason that the Court is enjoined to adopt the common law approach of comparison with previous decided cases with a view to taking incremental steps where that may be appropriate: see Dubai Aluminium at  per Lord Nicholls, and Morrison 2 at  per Lord Reed.” [Emphasis added]
Application of the test for vicarious liability
Stuart-Smith LJ started his consideration as to whether Blackpool FC should be liable by holding that:
“…the mere giving of an opportunity to commit abuse is not sufficient and that the critical question is whether the features of the relationship between Mr Roper and Blackpool FC are to be regarded as akin to employment as opposed to Mr Roper carrying on business (broadly construed) on his own account. The fact that the opportunity to commit abuse would have been removed if Blackpool FC had severed its connection with Mr Roper is equally applicable whether the relationship was akin to employment or one where Mr Roper was acting on his own account: it is therefore not of itself informative about the nature of the relationship. Similarly, the fact that, as the Judge found, there was no more important task for the club than spotting and capturing young players for the club and that Mr Roper was one of a number of unpaid volunteers who did that scouting and conferred important benefits upon the club by the introduction of players is also consistent with his acting either in a role that was akin to employment or one where he was effectively doing that work as an independent third party….
…I do not consider it to be helpful to assert that “Roper’s activity was part of Blackpool’s business activity.” It would, in my judgment, be more accurate to say that Mr Roper’s scouting activities conferred benefits upon Blackpool FC that were important for the development and survival of its business. This alternative formulation carries the point that the benefits he conferred could equally have been conferred by someone in a relationship that was akin to employment or someone acting independently.”
While it was true that the scout’s position gave him access to and the opportunity to abuse boys who he came across in the course of his scouting activities, that was not enough in itself to satisfy the requirements of Stage 1. There was no evidence of any control or direction of what he should do. His activity was not exclusively for Blackpool as he was also involved in assisting boys trying to get into other clubs. There was a complete absence of even a vestigial degree of control. With particular reference to the tour, every aspect of the planning, running, administration and financing was exclusively down to the scout, bar the minimal contribution of £500 from the club.
If it was necessary to apply Lord Phillips’s five criteria; the club had no power to direct the scout to carry out scouting activities and there was no obligation on him to scout either at all or in any particular way. There was no evidence of contract between the club and the scout. There were no ties imposing obligations on either side. There were none of the elements of control and assignment seen in Cox. By contrast to Armes, the Club had no statutory duty to boys who wanted to play football and did not place boys with the scout – the opposite was true. “Furthermore, the continuing involvement of the local authority in Armes in controlling, monitoring, supervision and approval of the foster parents was a feature that has no equivalent in the present case. To my mind, Armes is at present the high-watermark for an expansionist approach to the imposition of vicarious liability; and the present case falls far short of being analogous.” As with the doctor in Barclays, the scout was under no obligation to accept work and it was irrelevant that he was essential or integral to the club’s business. With regards to enterprise risk, what was necessary is the creation of such risk and increasing risk by:
“….using the “employee” to further the objects of the business in circumstances where there is a level of control rendering the relationship between the defendant and the “employee” at least akin to employment. Thus, in the present case, it is not sufficient to say that the running of a football club with the need to attract young and talented players gives rise to the risk that it will also attract sexual predators. What is required is to show that the relationship between the defendant and the predator involves a degree of control and direction of the abuser by the defendant that makes it akin to employment rather than the utilisation of someone over whom the defendant does not even exercise a vestigial degree of control. That vestigial degree of control must be present during the course of the relationship: it is not sufficient to show that the employer has the power to terminate it:”
Stuart-Smith LJ further held in applying Stage 2 that the tour to New Zealand could not be described as part of the scout’s normal activities. The scout had exercised complete control over the tour, and the club had not endorsed the trip –“Not only was it not in any real sense a Blackpool FC operation, neither Blackpool FC nor anyone else had held it out as being one.”
Stuart-Smith LJ’s detailed judgment is both an authoritative summary of the relevant caselaw in this ever -developing care of law, and a valuable contribution in its own right to the boundaries of vicarious liability. In its application of the relevant principles to the particular facts of the case, the Court of Appeal has signalled that the more restrictive approach adopted in Barclays and Morrison 2 is likely to be here to stay until, or if, the Supreme Court are asked to consider the issue once again.