Vicarious Liability

Two very recent cases show the development of a trend that the owners of medical businesses need to take note of. The case of Breakingbury v Croad, from April this year, held that a practice owner was responsible for the actions of his associates. In the Croad case it involved negligent treatment to a patient, the principle had neither met or treated. Hot on the heels of this case, comes the case of Hughes v Ratten, with judgement in this case last month. Here, the Court held that the structure of an NHS practice meant it was not possible to say that the associates were truly in an independent business role and the practice owner was held responsible for their actions. 

Much has been made of the fact that Ratten was a decision about NHS practice. Whilst that is true, it is hard to see sufficient differences in the arrangements in private practice to foresee a different result if a case was brought before the Courts arising from circumstances involving non-NHS treatment. 

We think it is important to see cases such as this from the claimant Solicitor’s perspective. The Solicitors in the Ratten case sued the practice despite the indemnifiers of the associates being prepared to meet the claim, why? There may be many reasons. However, one factor will probably be simplicity. If the claimant sues the practice, he can leave any arguments about the responsibility for parts of the treatment, possibly between different associates, to the practice owner to resolve. Why would a claimant lawyer run the risk of suing the wrong associate or equally, suing all of them and running the risk of not recovering costs against all of them, when he doesn’t need to? 

We foresee the practice of suing the business and leaving them to resolve responsibility as between those within the business as increasing. It is only the historic structure of dental and medical practice that produces this situation; it does not occur elsewhere in business. 

These recent cases establish a direction of travel and in our view, medical businesses are going to need to address the vicarious liability exposure and at HPPB we are well versed in providing appropriate cover for this risk.