300 / 324
Per Denning, L.J. :
Two men named Lister,
father and son, were employed by the Romford Ice
and Cold Storage Co., Ltd., the plaintiffs. Their
task was to collect waste and take it to the factory.
On 26th January, 1949, the son, the defendant, drove
the lorry from the plaintiffs' premises to a slaughter
house in Oldchurch Road, Romford. The father
went with him. The defendant drove the lorry
through the main gates into the yard of the slaughter
house. His father got off to go to the office. The de
fendant backed the lorry to get it into position and
unfortunately ran into his father and injured him.
The reason was partly because the engine was
defective, so that the defendant had to keep it going
fast and, therefore, reversed more quickly than he
need have done ;
partly because the son did not
take sufficient steps to see that all was clear : partly
because the father did not keep a proper look-out.
The father sued the plaintiffs for damages for negli
gence. The case was tried by McNair, J., on
29th January, 1953. He found that the father was
one-third to blame and the plaintiffs two-thirds. He
assessed the total damages for the injuries at £2,400
and gave judgment for the father for .£1,600 and
costs.
The plaintiffs were insured against this liability
and the insurers have paid the father the £1,600
and costs. Now the insurers seek to recover that
sum from the son, the defendant. To do this, they
have brought an action in the name of the plaintiffs
against him. The Romford Ice and Cold Storage Co.,
Ltd., are only nominal plaintiffs. The managing
director of the plaintiff company came to the court
and gave evidence. He said that the plaintiffs were
not consulted about this action. The insurers bring
it under their right of sub-rogation or under the
clause in the policy authorising them to use the
name of the company.
Let me put aside for the moment the question
of insurance and treat the case as if the Romford
Ice and Cold Storage Co., Ltd, were the real plaintiffs.
Even so, there was until very recently never a case
of this kind recorded in our books. Many a master
has been made responsible for the mistakes of his
servants, but never has he sought to get contribution
or indemnity from his servants. One obvious reason
is that it is not worth while. The master is not
allowed to make any deduction from his servant's
wages : and it would seem the extreme of harshness
to seize his savings or to make him bankrupt. The
.
other reason is no doubt the reluctance of a good
master to visit the risk of accidents on to his servants'
The risks should be borne by the undertaking as a
whole rather than on the poor unfortunate servant
,
who happens to make a mistake in a moment of
temporary inadvertence. It seems that these reasons
no longer commend themselves to the insurers of
employers, and we have to consider whether the
claim is good in law.
When a man holds himself out as a skilled man,
he thereby impliedly warrants that he is competent
at his work and will exercise his skill on his em
ployer's behalf, but he does not warrant that he will
never make a mistake and I know of no case where
it has been so held. If a lorry-driver has an accident
owing to a moment's inadvertence or a slight error
of judgment, and a third person is injured, his
employer must pay damages. The law imposes a
very high standard of care in such cases.
Another objection to the implied contract is that
it would mean that the master could sue his servant
for negligence although the master suffered no
damage. That cannot be right.
It is one thing to say that, as between strangers,
insurance is irrelevant, but quite another thing to
say that as between master and servant it is irrelevant.
If the master relies on an implied contract to make
the servant liable, the servant may well rely on an
implied term to exempt himself.
This shows that there is an implied term in these
cases whereby, if the employer is insured, he will
not seek to recover contribution or indemnity from
the servant. I cannot help thinking that the insurers
undertook the risk on the very same understanding.
The premium was fixed no doubt on the basis that
they would foot the bill themselves. No allowance
would be made for the possibility of any contribution
being obtained from the plaintiffs' servants. Yet,
if this action is well founded, it means that in every
one of these cases, the insurance company can turn
round and bring an action in the name of the em
ployer against the servant. Nothing could be more
detrimental to good relations between an employer
and his servants. Nothing would be further from
the contemplation of the parties.
Per Birkett, L.J. :
It was by virtue of this clause
that the writ was issued, and it was issued without
consultation with the plaintiffs. By entering into a
policy of the kind we are considering, containing the
condition which I have recited, the master delivers
himself into the hands of the underwriters com
pletely. His servant may have been in his employ
ment for many years and rendered him loyal and
devoted service ; yet, if he were to be found guilty
of negligence, for which the master was in law
responsible, and
the underwriters had paid the
damages under the master's policy, the underwriters
could sue the servant in the master's name, although
the master himself would never have dreamt of
doing so;
and the underwriters could recover
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