Case Update: Ng Huat Seng v Munib Mohammad Madni [2017] SGCA 58 – Singapore Court of Appeal discusses non-delegable duty of care in negligence and ultra-hazardous acts

Significance

Singapore Court of Appeal discusses non-delegable duty of care and vicarious liability in the tort of negligence and in particular the doctrine of ultra-hazardous acts. It would appear from the Court’s comments that it is inclined to accept the ultra-hazardous acts doctrine as part of Singapore law provided it is established on the narrow ambit as held in the Biffa Waste case. That is, the doctrine of ultra-hazardous acts should be applied only to activities that were “exceptionally dangerous whatever precautions are taken”.

Brief facts

The respondents demolished and re-built their house. Some debris fell from respondents’ property on the boundary wall shared with the appellants’ house. The debris also ricocheted off the wall and broke some items on the appellants’ property. The appellants sued the respondents and the respondents’ builder, Esthetix. They pleaded that the demolition works on the respondents’ property was extra-hazardous, that the respondents were personally liable for failing to “exercise reasonable care to avoid or prevent the damage and loss”, that the respondents had failed to exercise reasonable care in appointing Esthetix as their contractor.  The respondents denied that the demolition works had been carried out under their “control, supervision and/or management”, and pleaded that Esthetix was an independent contractor, and that they have exercised reasonable care in selecting Esthetix.

The appellants failed in their claims in the District Court and on appeal in the High Court. The Court of Appeal (CA) dismissed their appeals.

Legal Principles

Vicarious Liability

Vicarious liability is a form of secondary liability. It has always been recognised that a prerequisite for the imposition of such liability is the existence of a special relationship between the defendant and the tortfeasor such as would make it fair, just and reasonable to impose liability on the defendant for the wrongful acts of the tortfeasor: at [41], [62]. Whatever might be the nature of that special relationship, its very antithesis is a relationship under which the tortfeasor is engaged by the defendant as an independent contractor: at [42], [64].

The CA considered the UK decisions of Various Claimants v Catholic Child Welfare Society and others [2012] 3 WLR 1319 (“the Christian Brothers case”) and Cox v Ministry of Justice [2016] 2 WLR 806 (“Cox”) to be fine-tuning of the orthodox legal principles on vicarious liability so as to accommodate the more diverse range of relationships which might be encountered in today’s context and not some major departure in terms of analytical framework: at [62]-[63].

In the Christian Brothers case, Lord Phlilips elaborated on the 2-stage inquiry in determining vicarious liability:-

  1. Was there a true employer-employee relationship between the defendant and the tortfeasor?
  2. Was the tortfeasor acting in the course of his employment when he committed the tortious act?

On the first stage, the relationship that gave rise to vicarious liability in the vast majority of cases was that between an employer and an employee under a contract of employment. In such a situation, the following would generally be true, and there would usually be no difficulty in finding it fair, just and reasonable to impose vicarious liability on the employer (the Christian Brothers case at [35]):

  • (a) the employer would be more likely than the employee to have the means to compensate the victim and could be expected to have insured itself against that liability;
  • (b) the tort would have been committed as a result of activity undertaken by the employee on behalf of the employer;
  • (c) the employee’s activity would likely be part of the business activity of the employer;
  • (d) the employer, by employing the employee to carry out the activity, would have created the risk of the tort being committed by the latter; and
  • (e) the employee would, to a greater or lesser degree, have been under the control of the employer at the time the tort was committed.

On the second stage of the inquiry, where the relationship between the defendant and the tortfeasor was akin to an employment relationship, the issue was whether there was a “close connection” between the tortious act and the tortfeasor’s relationship with the defendant.

These principles do not change the legal position that people who engage independent contractors are not subject to vicarious liability. On the facts of the case, Esthetix was an independent contractor. It had pursued the project for its own gain (at [69]): (a) Esthetix concluded contracts with consultants and subcontractors in its own name; (b) it hired its own employees and was solely responsible for their management and supervision; (c) it took out insurance in its own name; and (d) it maintained a separate account from the respondents and regularly received lump sum payments from the respondents which it retained as its own profits.

Negligent Selection of Contractor

Liability for negligent selection of contractor is a primary liability. The appellants tried to argue that the High Court Judge was wrong in considering the “turnkey” approach which the respondents adopted in engaging Esthetix as builder. The turnkey approach was that as the main contractor, it assumed carriage of the entire project and was contractually responsible to the respondents for both demolishing the existing house on the property as well as designing and building the new house. To that end, it was to engage such subcontractors and professional consultants and apply for such approvals as might be required. This differed from the “traditional approach”, under which the owner would engage a team of professional consultants to design the house and obtain the necessary approvals before calling for tenders and appointing a main contractor to undertake the construction of the house. In keeping with the arrangement in this case, Esthetix appointed professional consultants to provide it with the requisite architectural and engineering services for the project. See [4].

The CA did not think the Judge was wrong. The Judge did state expressly that the applicable standard was “that of a reasonable person in the circumstances of the defendant”. What the Judge then proceeded to do was to have regard to the particular circumstances of the present case, including the applicable industry practices, and then ascertain, on this basis, what a reasonable person in the respondents’ position would have done. Industry standards and common practice have long been viewed as important, although not necessarily conclusive, factors in ascertaining the appropriate standard of care. When receiving evidence of what is alleged to be a common and approved practice so as to assess the standard of care appropriate in a particular set of circumstances, the court should of course examine the practice against considerations of logic and common sense. It would be just as unwise to accept a common industry practice uncritically as it would be to simply ignore it: at [74].

On the facts of the case, Esthetix was licensed to carry out the works that it had been engaged to perform. In a regulated area of activity, the fact that a tortfeasor was statutorily qualified to carry out the very works that the defendant engaged him to do would generally afford a cogent basis for excluding a finding of negligence on the part of the defendant in selecting that person to do those works: at [76].

Non-Delegable Duty of Care and Ultra-Hazardous Acts Doctrine

The appellants sought to argue that the respondents bore a non-delegable duty to ensure that Esthetix took reasonable care in performing the demolition works which it had been engaged to carry out on their property. The CA rejected this.

The CA referred to its framework set out in the decision of Management Corporation Strata Title Plan No 3322 v Tiong Aik Construction Pte Ltd and another [2016] 4 SLR 521 (“Tiong Aik”).

In Tiong Aik, the CA had sought to rationalise the situations in which non-delegable duties of care could arise. Drawing on the principles laid down in Woodland v Swimming Teachers Association and others [2014] AC 537 (UKSC) (“Woodland”) as a starting point, the CA formulated the Tiong Aik framework, which was essentially a two-stage test for determining whether a non-delegable duty would arise on a given set of facts (at [58] and [62] of Tiong Aik).

At the first stage of this two-stage test, the claimant would have to satisfy the threshold requirement that:

(a) either his case fell within one of the established or recognised categories of non-delegable duties; or

(b) his case possessed all of the five defining features outlined by Lord Sumption JSC in Woodland at [23], namely:

(i) The claimant was a patient or a child, or, for some other reason, was especially vulnerable or dependent on the protection of the defendant to avoid the risk of injury. Prisoners and residents in care homes were also mentioned in Woodland as likely examples in this regard.

(ii) There was an antecedent relationship between the claimant and the defendant, independent of the negligent act or omission itself, which placed the claimant in the defendant’s actual custody, charge or care, and from which it was possible to impute to the defendant the assumption of a positive duty to protect the claimant from harm, and not merely a duty to refrain from conduct which would foreseeably harm or injure the claimant. In this regard, Lord Sumption JSC noted in Woodland that it was characteristic of such relationships that they involved an element of control by the defendant over the claimant, which would vary in intensity in different situations, but would “clearly [be] very substantial in the case of schoolchildren” (see Woodland at [23]).

(iii) The claimant had no control over how the defendant chose to perform the obligations arising from the positive duty which it had assumed towards the claimant, that is to say, whether personally or through employees or third parties.

(iv) The defendant had delegated to a third party some function that was an integral part of the positive duty which it had assumed towards the claimant; and at the time of the tortious conduct, the third party was exercising, for the purposes of the function thus delegated to him, the defendant’s custody, charge or care of the claimant and the element of control that went with it.

(v) The third party had been negligent not in some collateral respect, but in the performance of the very function assumed by the defendant and delegated by the defendant to him.

At the second stage, the court would additionally take into account the fairness and reasonableness of imposing a non-delegable duty of care on the defendant in the particular circumstances of the case, as well as the relevant policy considerations in our local context (at [62] of Tiong Aik).

Ultra-hazardous Acts Doctrine

The CA noted some criticisms made by the High Court Judge of the ultra-hazardous acts doctrine. In particular, this doctrine appears to have been rejected in Australia: at [80]. However, the CA declined to come to a firm conclusion on the issue because on the facts, the doctrine would not be made out.

At [91], the CA referred to the Honeywill and Stein, Limited v Larkin Brothers (London’s Commercial Photographers), Limited [1934] 1 KB 191 (“Honeywill”) case and observed that in that case, it was considered an activity might be considered ultra-hazardous on account of its “inherently dangerous” nature even if, when proper precautions were taken, no harm was likely to follow. Honeywill was criticised significantly. So in the subsequent Court of Appeal case of Biffa Waste Services Ltd and another v Maschinenfabrik Ernst Hese GmbH and others [2009] 3 WLR 324 (“Biffa Waste”), the court tried to narrow the ambit of the doctrine. Stanley Burnton LJ stated therein that the doctrine of ultra-hazardous acts should be applied only to activities that were “exceptionally dangerous whatever precautions are taken” (at [78] of Biffa Waste). The CA found this approach “attractive”: at [94].

Some activities remain “exceptionally dangerous” even if precautions are taken, in that these activities pose a material risk of causing exceptionally serious harm to others even if they are carried out with reasonable care. Using explosives for a legitimate purpose is an example of such an activity; another might be the use of extremely hazardous chemicals for a legitimate purpose. Whether it is ultra-hazardous or exceptionally dangerous would have regard to: (a) the persistence of a material risk of exceptionally serious harm to others arising from the activity in question; (b) the potential extent of harm if the risk materialises; and (c) the limited ability to exclude this risk despite exercising reasonable care. See [95]. It is the persistence of such a risk despite the exercise of reasonable care which makes it fair, just and reasonable to hold the defendant liable for any negligence in the performance of the activity even if the negligent conduct was on the part of an independent contractor whom the defendant had engaged to carry out the activity: [96].

On the facts of the case, the CA found that the demolition works could not reasonably be said to be ultra-hazardous: [97].

(a) The appellants did not put forward anything to explain how the damage to their property ensued from a particular risk arising from the demolition works on the respondents’ property that remained substantial despite the exercise of reasonable care.

(b) Demolition works are routinely done and there is nothing to suggest that despite the exercise of reasonable care, there remains a material risk of exceptionally serious harm arising from such works.

(c) This analysis does not change even though landed properties in Singapore tend to be located in close proximity to one another. That simply establishes the element of factual proximity and the foreseeability of harm being caused if reasonable care is not taken when demolition works are carried out. It does not in any way shed light on whether such works are “exceptionally dangerous whatever precautions are taken” (per Burnton LJ in Biffa Waste at [78]), which was the central issue here.

In closing, the CA made some final remarks on the ultra-hazardous acts doctrine. The Court noted that the doctrine retains the responsibility and liability of the principal by imposing on it a separate duty to ensure that the party who is actually performing the activity does so with reasonable care. If the principal fulfils its duty (that is, if the principal takes reasonable care to ensure that the party performing the activity does so in a non-negligent manner and the latter does indeed perform the activity non-negligently) but some harm nonetheless ensues, there will be no liability on the basis of negligence on the part of the party performing the activity, nor will there be liability for breach of a non-delegable duty on the principal’s part. But if, due to the negligence of the party carrying out the activity, harm ensues, then that party will be liable in negligence; and in addition, the principal too will be liable, albeit on the basis of breach of its non-delegable duty rather than on the basis of negligence in performing that activity: at [107].

A claimant whose case comes within the ambit of this doctrine is in a position to make a principal answer for the negligent acts and/or omissions of another even if the latter is an independent contractor: at [108].

Comment

By the looks of the CA’s comments on ultra-hazardous acts doctrine, it does appear that the apex court is inclined to accept this doctrine as part of Singapore law provided it is established on the narrow ambit as held in the Biffa Waste case. That is, the doctrine of ultra-hazardous acts should be applied only to activities that were “exceptionally dangerous whatever precautions are taken”.

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