Duties of Care between Actors in Supply Chains
Journal of Personal Injury Law, Forthcoming
Posted: 1 May 2017
Date Written: April 29, 2017
Rapid changes to employment practices and structures have tested and will continue to test the limits of liability in tort law. To date, much of this pressure has been applied to the principles governing vicarious liability. That corner of tort law has undergone significant development in response to, for example, the increasing sophistication of many employees and a growing tendency of businesses to outsource work. One important recent change is that vicarious liability can now arise in the absence of a relationship of employment. An relationship that is akin to employment may suffice. Another noteworthy change concerns the recognition of so called ‘dual vicarious liability’, pursuant to which more than one defendant can incur vicarious liability for a tortfeasor’s wrong. These and related developments are reactions to the changing way in which work is being done in the modern world. They are the result of the courts’ efforts to ensure that the law of vicarious liability produces outcomes that are thought fair and just to contemporary eyes. Another part of tort law that has come under significant pressure on account of shifts in employment structures concerns the duty of care element of the action in negligence. Increased outsourcing of work raises the question whether a company within a supply chain might owe a duty of care to employees of another company within the chain. It is this question with which this article is concerned. It is convenient to discuss it by way of the following paradigm scenario. Suppose that Company A requires certain goods for its business but, for one reason or another, it chooses to source them from Company B rather than to fabricate them itself. Company B tortiously injures one of its employees, Employee. If Employee cannot obtain an effective remedy from Company B for some reason (say, because Company B is insolvent, been wound up, or is without liability insurance, Employee may look to Company A for redress). A claim by Employee against Company A is likely to be confronted with numerous difficulties. However, a key issue in any such claim will be whether Company A owed Employee a duty of care. What are the prospects of a duty being owed in this scenario? This question has arisen for determination by the courts in some other jurisdictions and has received a certain amount of academic scrutiny. However, the issue has never been considered by an English court. It has not been the subject of sustained analysis in this country either. This article fills this gap.
Keywords: Tort; Negligence; Duty of Care; Supply Chain; Corporate Liability
JEL Classification: K13
Suggested Citation: Suggested Citation