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June 2020

Vicarious liability for environmental offences has broader lessons for employers

Vicarious liability for environmental offences has broader lessons for employers

The Case

Cowie v Perth Demolition Company Pty Ltd [No 2] and Anor (2020)

Perth Demolition Company Pty Ltd (now in liquidation) (PDC Pty Ltd) was engaged to demolish some properties and remove the rubble. Its sole director, Andrew McDonald, engaged a driver to dispose of the rubble at the Brajkovich recycling facility. In breach of that direction, and without PDC Pty Ltd or Mr McDonald’s knowledge, the driver illegally dumped the material.

PDC Pty Ltd was charged with three breaches of the Environmental Protection Act 1986 (WA) (EP Act), on the basis that it was vicariously liable for the acts of the driver. Mr McDonald was also implicated for being a director of PDC Pty Ltd.

The Verdict

In the Magistrates Court, PDC Pty Ltd and Mr McDonald were acquitted of all charges. The decision was reversed on appeal, with the Supreme Court finding an employer could be vicariously liable for the acts of its employees under the EP Act. The Court found PDC Pty Ltd vicariously liable because the driver was acting within the scope of his employment and undertaking the task he was employed to do. The driver was employed to dispose of the rubble but that did not limit the scope of the task. The instructions to take it to the Brajkovich recycling facility only sought to regulate how the driver should perform the task.

The Court also found that regardless of the vicarious liability finding, PDC Pty Ltd and Mr McDonald were still guilty of an offence under the EP Act for causing or allowing the waste to be discharged or abandoned.

The Lessons

The decision, while concerning the EP Act, is significant as it shows how easily employers can be found vicariously liable for the actions of their employees. Employers must ensure their employees are carrying out their duties lawfully. Responsibility extends not only to the instructions of how to carry out a task, but the scope of the task. This means consideration should be given to ensuring there are systems and procedures in place to ensure tasks employees undertake are done so lawfully and within the confines of the law.

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