• Subject Name : Law

Legal Advice to Veronica Concerning the Wrongs of Her Employees

Issue (s)

  • If Sylvester has an authority to offer any amount for buying of any antique from the third person on behalf of Veronica.
  • If Sylvester has committed an offence as an employee of Veronica.
  • If Veronica liable for delivering the painting sold by Bob?
  • If Angela may get compensation for the amount of the painting? If yes then who will be liable for paying that amount, Bob or Veronica.
  • If Bob has committed any offence as an employee of Veronica.


Doctrine of Vicarious Liability

Commonwealth law

Crimes Act 1900 (NSW)


Both of the employees of Veronica, Bob and Sylvester, have committed acts which are done in the course of employment but ultimately has been done without getting authority of the same from the employer, Veronica.

The doctrine of vicarious liability is basically concerned with the imposition of strict liability is on the employers for any offence or omission committed by the employees in the course of employment (Goudkamp & Plunkett, 2017). The two elements which speak loudly in the doctrine is the liability of wrong or omission over the employer and this week liability which is to say a liability without a proof.

In the particular case, of Veronica, one of her employees called Bob allegedly committed the act of fraud (Section 192E of the Crimes Act (NSW), 1900) with a third party when he was an employee of Veronica. Since Bob was one of the employees of Veronica and he committed this wrongdoing of selling an item which is not in his authority to a buyer and then disappears, the liability for the wrongdoing will be on Veronica and Angela can sue Veronica for delivering the painting.

The doctrine is supported by the maxim qui facit per alium facit per se (he who acts through another does the act himself. As provided in the case of Shaw Savill and Albion Co. Ltd v Commonwealth, Dixon J stated that if wrong is committed by one of the servants of Commonwealth, the Commonwealth will be vicariously liable for the acts of its employees depending on the existence of duty of care owed by the employee.

Considering the matter of buying of a clock by Sylvester without the knowledge of Veronica, for this act of dishonesty and fraud of the employee, the employer will be responsible as it occurred within the course of employment (Lloyd v Grace, Smith & Co). In the case of New South Wales vs Leopore, it was concluded by Gleeson CJ that the fact of commission of the wrongdoing at a place other than the workplace or after the working hours is not conclusive against the liability of the employer.

Even in the case of Sestili v Triton Underwriting Insurance Agency Pvt Limited, the judgement was concluded with two propositions. The former one suggests that the fact of intentional wrongdoing of the employee may not be sufficient for denying the vicarious liability. Also, the fact of the case stating that the act of employee was contrary to the instruction provided by the employer will not be sufficient for denying the liability. Determination of the act following in the course of employment has been discussed with a number of principles in the case of New South Wales v Leopore. The distinction between the limitation of sphere of employment and the minor regulations of the conduct of the employee within that is sphere of employment is considerable in the case (Plumb v Cobden Flour Mills Co).

Since Sylvester was looking into all the major collectors and the business bank account, his course of employment also includes the act of buying the clock after picking it from the home of the buyer. Also, the close connection test has been sufficiently satisfied in the case of Veronica with her employees, Bob and Sylvester, as she herself has authorised the employees to act. Also, in one of the recent cases of Pioneer Mortgage Services Pty Ltd v Columbus Capital Pty Ltd, the Federal Court pronounced that the employer can be held liable for the fraudulent act of employee even if the act was prohibited by the employer.

Veronica has to satisfy the court with the fact of having all the reasonable steps taken in at the workplace to ensure the prevention of discrimination and harassment from any of the employee. The act of taking reasonable care is significant in this regard.


With the application of the doctrine of vicarious liability, the employer will be held responsible for the acts committed by the employee in the course of employment which ultimately suggest that Veronica will be responsible for all the acts and wrongdoing committed by both of her employees, Bob and Sylvester.

Legal Advice to Mark Concerning Restraint of Trade and Bank Loan


  • If the act of United Trucks Pty Ltd of sending letter asking to access the operation of the company owned by Mark a legal act.
  • If the letter by bank for non-payment of loan taken by Mark for business is justifiable.
  • What should be the approach of Mark for these two acts with respect to his company.


 Restraints of Trade Act 1976 (NSW)

National Consumer Credit Protection Act 2009 (Cth) (NCCP)

Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act)

Competition and Consumer Act 2010 (Cth) (CCA).

Code of Banking Practices


The clause of restraint of trade in the contract that mark had with United Trucks Pty Ltd is valid and provides for non-engagement in any truck industry in the Queensland for the next five years after he left the company. As provided in the case of Lloyd’s Ships Holdings Pty Ltd v Davros Pty Ltd, the Ladder clauses are a series of clauses which are included by the parties in order to ensure that even if one of the restaurants doesn't work the other will work for the organisation. The trade restriction clause provided by United trucks Pty Ltd requires Mark to not get engaged in the trucking industry for a period of 5 years in particular in the Queensland which is certainly a genuine attempt of the organisation to define a reasonable restraint and thus is valid and applicable for the ex-employee Mark in this case.

As provided by Justice Gummow in the case of Adamson v New South Wales Rugby league Limited, the time for the assessment of the reasonableness of the reason that has been imposed by the contract is actually the date on which the restraint was imposed. Considering this case, Mark is under the liability of not engaging in any trucking industry in the Queensland for the next five years which suggests that he should not be in the trucking business in the area of Queensland still 2022. Though, he has registered a trucking business in 2018 under the name of Sunshine Trucks Pty Ltd which is actively engaged in business within the Queensland as well. The section 4M (a) of the Restraint of Trade (ROT) Act provides for the operation of that restraint of trade provisions in the agreement with the employees which are not affecting and can operate concurrently with the Act.

The section concerned presence of restraint of trade but no exemption is provided for the provisions concerning cartel conduct (Division 1 of Part IV of the ROT Act). Section 51(2) and Section 4 of the ROT Act is closely related with the exemption provided by the act in respect of restraint of trade. The ‘service’ has been defined in section 4 of the Act which provides for no inclusion of benefits or rights which is provided through supply of goods or performance of work contained in the contract of service Also section 51(2) (b) provides for some common types of restraint of trade which can exist between an employer and individual employee as an exemption which forbids the employee from conducting the similar type of work after the termination of the employment provided in a given geographical area or suggesting the certain consumers or employees related to the earlier employer.

The former employee can successfully ask for ceasing the operation of Mark’s company in Queensland for the five years. As the former employer of Mark has issued a letter against Mark providing a notice of seizing all the activities of his company in Queensland as provided in the employment agreement with Mark. In this particular situation, Mark is advisable to develop an agreement with the ex employer where the financial issues related with the business of Mark particularly the bank loan can be address as a part of negotiation with United Trucking Pvt Ltd. As provided in the case of Tullett Prebon (Australia) Pty Ltd v Purcell, the inclusion of a clause where a payment will be made to the employee in the restraint period is not considered as a reasonable clause which cannot be enforced as a part of restraint of trade.

The Grasping Bank Limited is threatening the Sunshine Trucks Private Limited owned by Mark to sue him for $10,000 for the non-payment of loan instalment which mark owed to the Bank. This act of the bank threatening the company with letter has to be dealt in accordance with the Debt collection guideline for collector and creditors. This guideline was originally released by the Australian Competition and Consumer Commission along with Australian Securities and Investments Commission in 2005 to facilitate the better understanding of rights and obligations of the debt collection process between the creditors and the debtors. The act of the bank of threatening to take legal action against the company is not legally permitted as provided in the guidelines

As provided in section 2 (c) of the given guidelines, the creditors should not make an unreasonable or an appropriate demand of payment from the date when they are aware of the financial situation of the data is disturbed due to the letter demanding the series of operation of the company in Queensland by the former employer of Mark, United Trucks Pty Ltd. The act has been specifically prohibited under s. 45(2)(p) of the Australian Consumer Law and Fair Trading Act 2012 (Vic). Also, the part 2, sections 17 and 18 in regards to Conduct towards the debtor or their representatives and Conduct towards family members and other third parties prohibit such approach by the creditors.

As there is a financial hardship with the company of Mark, he can issue a credit provided notice in either writing or oral of their ability to meet the obligations of repayment of the loan has provided in section 72 of the National Credit Code (NCC) (Schedule 1 of NCCP). If the bank does not agree with this proposal of Mark with the variations considering his financial situation, then applying an external dispute resolution scheme can be beneficial for Mark in this case.

Also, under the clause 28.2 of the Code of Banking Practices provides for a cooperative approach between the debtor and creditor to ensure the overcome of a financial hardship faced by the data with developing a sort of repayment plan which will ensure the timely payment of the loan by the debtor to the creditors.


The former employee of the company can seek for the seizing of the operation of the company of Mark particularly in the region of Queensland and thus he can have the access to his business activities outside the Queensland for the next five years as provided in the employment agreement of Mark. Considering the letter from the bank for non-payment of the loan, battle of threatening is illegal and Mark has considerable time and approach to deal with the financial crunch and payment issues with the negotiation or through matter in court.

Bibliography for Australian Securities and Investments Commission Act

Acts/ Legislations

Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act)

Commonwealth law

Competition and Consumer Act 2010 (Cth) (CCA).

Crimes Act 1900 (NSW)

Doctrine of Vicarious Liability

National Consumer Credit Protection Act 2009 (Cth) (NCCP)

National Credit Code (NCC)

Restraints of Trade Act 1976 (NSW)

Tullett Prebon (Australia) Pty Ltd v Purcell [2008] NSWSC 852


Adamson v New South Wales Rugby league Limited (1991) 31 FCR 242

Lloyd v Grace, Smith & Co [1912] UKHL 1; [1912] AC 716

Lloyd’s Ships Holdings Pty Ltd v Davros Pty Ltd (1987) 17 FCR 505.

New South Wales v Lepore [2003] HCA 4; (2003) 212 CLR 511

Pioneer Mortgage Services Pty Ltd v Columbus Capital Pty Ltd [2016] FCAFC 78

Plumb v Cobden Flour Mills Co Ltd [1914] AC 62

Sestili v Triton Underwriting Insurance Agency Pty Ltd [2007] SASC 241

Websites/ Journals

Goudkamp, J. & Plunkett, J. (2017) Vicarious liability in Australia: on the move?, Oxford University Commonwealth Law Journal, 17(1), 162-170, DOI: 10.1080/14729342.2017.1321817

Remember, at the center of any academic work, lies clarity and evidence. Should you need further assistance, do look up to our Law Assignment Help

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