Absa Makelaars (Edms) Bpk v Santam Versekeringsmaatskappy Bpk & another 2003) 24 ILJ 1484 (LC)
An employer will be vicariously liable for the dishonest acts of its employees where the wrongful acts were committed in the scope of employment. In the case of fraud, the employer will be liable if there is a sufficiently close link between the unlawful conduct of the employee and the employer's business.
Two insurance brokers were alleged to have accepted money from clients and, instead of investing the money, had stolen it for themselves by fraudulent means. The employer claimed for these losses in terms of an insurance policy covering theft, fraud and dishonesty by employees. The insurance company denied liability because it said the brokers were not employees and even if they were, an employer is not vicariously liable for the fraud of its employees.The court first had to decide if the brokers were independent contractors or employees. Finding that they were employees (in spite of the fact that they were paid for completed work only), the court had then to decide if the wrongful acts were committed in the course of employment. The court was of the view that whether the employer is liable will depend on whether there is a sufficiently close link between the unlawful conduct and the employer's business, and the work that the employees were authorized to perform. The court found that a sufficiently close link did exist and that Santam was obliged to compensate Absa for the losses.
Extract from the judgement
Dit is gevestigde reg dat 'n werkgewer aanspreeklik is vir onregmatige dade wat sy werknemer pleeg terwyl hy (die werknemer) binne die bestek van sy diensverrigting optree... Die betoog vind oenskynlik steun in die volgende stelling van Howie AR in Ess Kay Electronics Pte Ltd v FNB of Southern Africa Lld 2001 (1) SA 1214 (HHA); (2001) 22 ILJ 1070 (HHA) para 10:
'The question is always: were the facts in the case under consideration in fact authorised; were they in fact performed in the course of the employee's employment?'Dieselfde geld vir Innes AR se stelling in Mkize v Martens1914 AD 382 op 390:
'[A] master is answerable for the torts of his servant committed in the course of his employment, bearing in mind that an act done by a servant solely for his own interests and purposes, and outside his authority, is not done in the course of his employment, even though it may have been done during his employment.'...Die kernvraag bly of die werknemer binne die bestek van sy diensverrigting opgetree het. In Minister of Police v Rabie 1986 (1) SA 117 (A) op 130C verduidelik Van Heerden AR dit so:
It is clear that an employer may be liable for intentional wrongs committed by his employee. Since such acts will only in exceptional cases have been authorised by the employer, the test usually applied is whether the employee improperly carried out what he was employed to do, or whether his act was divorced from the employer's business.'Waar die werknemer afwyk van sy opdragte, is die werkgewer steeds aanspreeklik indien:
'there is a sufficiently close connection between such a capricious or wanton act and other conduct of his in furtherance of his employer's business' (Rabie op 131D).