We often speak to practice owners who need help with their general practice policies, covering things like contents, equipment, buildings & material damages. When we learn that there isn't a medical vicarious liability policy in place, it is our duty to explain the importance of vicarious liability and spend time highlighting the associated exposures involved.In a startling number of scenarios, practice owners are quick to dismiss our recommendation. We receive a common objection: the practice ensures that all medical personnel hold and maintain their medical malpractice policies. The common misconception is that the treating practitioner's policy should trigger and respond to the claim if a claim arises. This is not always the case, as we will further explore...

Breakingbury v Croad – what happened?

The Breakingbury v Croad County Court judgment (19 April 2021) highlights a court decision that identified that there was a "non-delegable duty of care" existing between the practice owner and the patient and vicarious liability for the errors and omissions of the treating dentists in delivering treatments to a patient whom he had never seen or treated.In this case, patient Lynda Breakingebury who visited the practice owned by Dr. Croad received care through two self-employed associates of the practice between 2008 and 2012. At the time, Dr. Croad had already been retired for seven years (since 2000) but still owned the practice until 2012.To Dr. Croad's astonishment, he received a letter of claim as he was the former practice owner, where he was required to defend the claim out of his own pocket.

What does non-delegable duty mean?

Non-delegable duty is used to justify the imposition of liability on one person for the negligence of another to whom the former has entrusted (or 'delegated') the performance of some task on their behalf. This notion is associated with vicarious liability. The fundamental directive of vicarious liability is that an employer is vicariously liable for the negligence of an employee provided the employee was acting 'in the course of employment. Importantly, vicarious liability of the employer is additional to the 'primary' liability of the employee for negligence. Regarding responsibility, a commonly recognised justification for vicarious liability is that, because the employer receives the benefit of the business performed, the employer should also be required to adopt risks associated with the business.

Other considerations…

Even in circumstances whereby an employee of a practice holds their indemnity, a vital consideration to make is how it will respond: If indemnity is provided by a discretionary medical defence organisation (MDO), the MDO has the right to decline representation and claim payments. In this case, the claim is likely to subrogate back to the practice. If indemnity is arranged through an insurer, it is possible that there are gaps in cover (through exclusions or restrictions). If a claim is therefore declined, it is likely to subrogate back to the practice. In circumstances of class actions (whereby a claim from multiple claimants against a single practitioner), the limit of indemnity or coverage may not provide full compensation amounts, leading to a portion of the claim being subrogated back to the practice.

FAQ - Vicarious Liability & Practice Indemnity

Q. Do I need to maintain indemnity after my retirement or after I sell the practice?

Q. I have never held vicarious liability for my practice, and it has been running for years. What can I do?

Q. Can I include practitioners in the practice malpractice policy?

Q. What limit of indemnity do I need to take out for the practice.