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Satellite litigation window firmly shut by Supreme Court

15th Aug, 2018 / Legal & Law Firm, News

Supreme Court holds that an employer does not owe its employees a duty of care during misconduct litigation proceedings

James-Bowen and others v The Commissioner of Police of the Metropolis [2018] UKSC 40 (Lady Hale, Lords Mance, Kerr, Wilson and Lloyd-Jones)

Summary

In a judgment of critical importance to the conduct of civil litigation, the Supreme Court has held that an employer does not owe its employees a duty of care to protect them from economic and reputational harm in relation to the way it conducts litigation arising out of alleged misconduct on their part. In doing so it overturns a judgment of the Court of Appeal decision that would potentially have had “a chilling effect on the defence of civil proceedings” (per Lord Lloyd-Jones, paragraph 35).

Factual background

The claimants were police officers who were alleged to have assaulted BA in the course of a search of his family home. BA brought a claim against the Commissioner. Immediately prior to the settlement of that claim, liability was admitted. The claimants were subsequently prosecuted for assaulting BA. They were acquitted in May 2011. The claimants argued that the Commissioner owed them a duty of care in relation to her conduct of the claim brought by Mr Ahmed. They alleged that they had been given assurances that their interests would be protected and the fact of the admission and settlement led the claimants to suffer damage to their health and welfare.

The claims were struck out by the High Court in May 2015 but the Court of Appeal held it was arguable that the Commissioner owed the officers (1) a duty to defend the litigation as effectively as possible and (2) a duty (when deciding whether to compromise the claim and if so on what terms) to take reasonable care not to sacrifice their professional reputations without good reason and without giving reasonable warning of what he intended to do. The Commissioner appealed.

Supreme Court

The Commissioner’s appeal was unanimously upheld and the claim dismissed. The duty of care claimed would not be fair, just or reasonable because:

  • Conflict of interest – the interests of the employer and the relevant employees is fundamentally different. The employer must be able to carry out its own investigation and make its own strategic decisions including “what degree of importance he attaches to successfully defending the claim and what financial and other resources should be devoted to its defence” (para 30).

Policy considerations:

  1. Parties to litigation should be able to avail themselves of the process of litigation in order to resolve their disputes without the fear of incurring liability to third parties (e.g. employees) if they do so…. READ FULL ARTICLE

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