Consideration of vicarious liability principles in sexual abuse cases

Case Note

Subject: PCB v Geelong College [2021] VSC 633

On 1 October 2021 the Supreme Court of Victoria handed down judgment for the largest award of damages in a historical sexual abuse claim.

Background

The Plaintiff commenced as a student in Year 7 at Geelong College in 1987. The College owned and operated a building fitted out to facilitate woodwork, ceramics and other crafts called the ‘House of Guilds.’ The House of Guilds was open to students from the College and other schools as well as the community on payment of a membership fee. It was open out of school hours. 

Bert Palframan (Palframan) was an honorary member of the House of Guilds; he was not a teacher or employee of the College. It was not in dispute that the Plaintiff was sexually abused by Palframan between late 1988 and mid-1990.  The abuse occurred at the House of Guilds and also when Palframan drove the Plaintiff home, which also provided the opportunity to Palframan to befriend the Plaintiff’s parents and further abuse took place at the Plaintiff’s home.  Palframan passed away in 1999.

The claim

The Plaintiff brought a claim against the College on the basis that the presence of a warden at the House of Guilds, Mr Elliott, together with the system of rostering and supervision undertaken extended the duty of care owed by a school to a student. 

The College denied it was vicariously liable for the abuse perpetrated by Palframan and submitted that the duty owed did not extend to the abuse perpetrated in Palframan’s car or at private residences. 

The decision

The Court first considered whether the College was vicariously liable for Palframan’s abuse of the Plaintiff with reference to the well-known High Court authority in Prince Alfred College, which determined that a relationship between employer/employee was required as a pre-requisite to apply the “special role” test for abuse. In this matter the Court did not consider that Palframan was an employee, but rather a member of the public who was permitted to use the woodwork room by virtue of his membership to the House of Guilds. On that basis, the College was not vicariously liable for the criminal acts of Palframan. 

The Plaintiff also advanced a claim against the College on the basis of negligence; specifically, that the College breached the duty of care it owed to him as a student and failed to take adequate precautions for his safety. The Plaintiff relied on extensive evidence of historical sexual abuse at the College, particularly in the late 1960s and 1970s. One former student gave evidence that he complained to the then headmaster that he was abused by a teacher. That complaint was made before the Plaintiff was a student and went nowhere.  Another student gave evidence that he made a complaint that Palframan had fondled him at the House of Guilds.

The Court was satisfied that because of the previous complaints, the College knew, or ought to have known of the general risk that students in its care could be interfered with, sexually or otherwise, and more specifically, was also aware of the specific risk to students posed by Palframan in the House of Guilds. 

The College argued that the system of supervision in the House of Guilds was reasonable and included a full-time warden and system of rostering and supervision of the students.  The Court rejected this and noted that because of the previous complaint about Palframan he should have been excluded from the House of Guilds, or ”watched like a hawk.”

The College also argued it should not be responsible for the abuse that occurred outside the school grounds, including in Palframan’s car and home and the Plaintiff’s home, when he was under the care and supervision of his parents. The Court found Palframan groomed the Plaintiff in the woodwork room for several months and was afforded the opportunity to take the Plaintiff home when the Plaintiff made a telephone call to his parents asking permission from the warden’s office, who was also present. On this basis, the Court considered that there was no break in the chain of causation between these events and the abuse that followed outside the school grounds. Similarly, the Court rejected the College’s submission that the Plaintiff’s parents owed a duty and breached that duty of care in the circumstances. 

The Plaintiff succeeded in establishing liability against the College.

The Wrongs Act

The College argued that Part VB of the Wrongs Act applied to the claim, which if accepted meant that damages were to be assessed under the Act and not the common law.  However, notwithstanding the Plaintiff was a high earner, practically the only difference was the multiplier used in future calculations.

The application of Part VB turned on the construction s 28C(2)(a) of the Wrongs Act, which excludes the application of Part VB to:

An award where the fault concerned is an intentional act that is done with intent to cause death or injury or that is sexual assault or other sexual misconduct.

The College’s position was that the relevant “fault” must be that of the Defendant and as the College did not commit the abuse, but rather Palframan did, s. 28C was not enlivened and damages were to be assessed under the Act.  The Court rejected the College’s arguments and concluded that the acts and omissions that give rise to the fault do not need to be that of the Defendant.  His Honour stated:

Applying the statutory meaning of ‘fault’ – namely, act or omission – the section will exclude the operation of Part VB if the act or omission ‘concerned’ in the ‘award’ of damages is sexual assault or sexual misconduct. In this sense, it is unnecessary that the act or omission be that of the defendant, only that the defendant be liable in damages for it and that it be ‘sexual assault’ or ‘sexual misconduct’.

In that sense, the acts or omissions ‘concerned’ in the present award of damages are for ‘sexual assault’ or ‘sexual misconduct’, albeit by Palframan, for whose misconduct the defendant is liable. Accordingly, the 3% multiplier was used (which is more generous to Plaintiffs).

Damages

The Plaintiff was aged 13 – 15 when he was abused and was 46 at the time of the trial.  There was a consensus of agreement the Plaintiff suffered PTSD and a generalised anxiety disorder and depression. 

The largest component of the award (approx. 75%) was for past and future economic loss (with future economic loss accounting for almost 50% of the judgment).

The Plaintiff successfully argued the abuse had a negative effect on the overall ‘trajectory’ of his career.  The Plaintiff completed High School in 1992 and enrolled in a Bachelor of Commerce, however, it was not until 2000 that he completed his degree. He then undertook a variety of roles, including senior positions as an account manager and regional manager.  In 2018 the Plaintiff transferred over to sales management position earning $240,000 per annum, plus bonuses. The Plaintiff was made redundant from this position in August 2019.  The redundancy “precipitated the … psychological collapse of the Plaintiff … [and his] façade was finally shattered”. The Plaintiff did not return to work thereafter.

The Court considered the success and trajectory of the Plaintiff’s brothers who each had exhibited “the kind of freedom, latitude and underlying confidence evident in members of a privately educated and supportive family where a degree of exploration in years of or surrounding tertiary education is neither uncommon nor discouraged”. It was found that but for the abuse, the Plaintiff would have completed his degree and started his professional career four years earlier than he did.  The Plaintiff’s psychologist gave evidence, which was accepted, that the Plaintiff’s redundancy had a devastating psychological effect upon him.  The abuse had impacted the Plaintiff ability to obtain alternative employment in a senior position.  His Honour awarded the equivalent of four years of “senior earnings” ($240,000 per annum) for the past period.

The Court noted the Plaintiff had a clear aptitude for sales and management and accepted that in the absence of the abuse he would likely have continued working in that area until about normal retirement age. This was supported by the Plaintiff’s brothers and wife who had maintained professional employment, and the fact that his middleclass lifestyle had expenses commensurate with such a position and earnings. The Court considered that the Plaintiff would have likely remained in a position of management until retirement age earning $250,000 gross per annum and that he was unlikely to work in a senior position or in any capacity for at least another six years.  If and when he did return to the workforce, he would likely take a less stressful sales role with earnings of $80,000 per annum.  The Court applied a slightly higher than normal reduction for vicissitudes of 20% for the uncertainty of sales and senior roles and potential early retirement (as the Plaintiff’s wife was older than him).

Implications

The College’s knowledge of previous complaints of abuse, including but not limited to Palframan and the fact that it undertook some supervisory role for the House of Guilds were crucial in the Court’s determination that a duty of care was owed and breached in the circumstances.  The Court’s finding that the College was not vicariously liable for the criminal acts of Palframan was sound and it is pleasing to see the Court resisted further expanding the concept of vicarious liability in these types of claims.

The approach to the application of Part VB of the Wrongs Act is generally consistent with approaches taken in other jurisdictions and informally in unlitigated claims where the common law damages assessments are applied (as opposed to statutory thresholds and caps introduced with civil liability/tort reform).

In relation to damages, the Plaintiff was accepted as a credible witnesses who, to his credit and notwithstanding the psychological effect the abuse had had on him, had completed University and progressed to a successful and lucrative career.  The Judge placed great weight on the Plaintiff’s fragile presentation when giving evidence and his previous ability to earn a significant income, which played a major role in the high award for past and future economic loss.

If you have any questions on this case note, please contact Partner Emily McKeowen.