Licensing and Vicarious Liability: What you need to know
What is vicarious liability?
- This is where one person or organisation can be responsible for the actings of another.
Why is this relevant in a licensing context?
- The Licensing (Scotland) Act 2005 sets out various criminal offences for which licence holders can be vicariously liable for the actions of others ie staff members. These offences include selling alcohol to underage persons and selling alcohol out-with the terms of a licence.
Has this not been the case for years?
- Yes, but an important change came into play in December 2010. When the 2005 Act first came into force, a person or organisation generally could only be vicariously liable if they knew an offence was being committed. The Criminal Justice and Licensing (Scotland) Act 2010 changed this, taking out the “knowledge” part.
So could I be liable even if I do not know an offence is being committed?
- Yes. However, there is an available defence of due diligence: if you can prove you did not know the offence was being committed and that you “exercised all due diligence to prevent the offence being committed”.
How can I exercise due diligence?
- It is a requirement under the 2005 Act for staff to be trained and for appropriate records to be kept.
- It is sensible to have a rigorous training session for new staff, with regular updates.
- Training records should be up-to-date and thorough.
- Written policies adopting a zero-tolerance approach could be provided to staff.
For whose actions could I be liable?
- An employee or agent.
Is it only the premises licence holder who could be vicariously liable?
- At the moment, yes, although this will probably change in the future.
- The Criminal Justice and Licensing (Scotland) Act 2010 introduced a new class of persons: the “interested party”. An “interested party” is someone who is neither the premises licence holder nor the premises manager, but who has an interest in the premises as an owner or tenant or who has management and control over the premises (or the business carried out on the premises).
- Provisions relating to interested parties are not yet in force and it is not clear when they will be implemented.
- When the provisions are implemented, the class of persons and organisations who could be vicariously liable for the actions of another will be widened. This could include tenants and franchisees of the licence holder.
General
- The changes are far-reaching and, given the consequences could involve prosecution, it is important for licence holders to understand how the law has changed.
