Question

Fan Bingbing is an employee, sole shareholder, and director of an environmental company called Blackspot Pty Ltd (Blackspot). The company cleans up black spots in the environment left behind by mining companies that failed to properly remediate their sites when they were finished. In the past Fan was an employee of another company that did similar environmental protection work called Yellowscope Pty Ltd (Yellowscope). Yellowscope, however, began laying-off staff and instead outsourcing its project work to independent contractors. To take advantage of this change Fan cleverly set up Blackspot but continued to do work for Yellowscope using the same working procedures and methods she was already familiar with. While working on a project for Yellowscope, Fan received a nasty gash across her face which required many stitches. She, therefore, sued Yellowscope for negligence because it was their procedures and methods she was using.

Is Yellowscope liable for Fan’s back injury? Can Blackspot be held partially liable for Fan ’s injury? Can Blackspot avoid liability on the grounds that Fan is sole shareholder and director of the company? Is it possible that Blackspot could be held 100% liable for Fan’s injury and if so, on what grounds?

Answer 1

Note: This response is in UK English, please paste the response to MS Word and you should be able to spot discrepancies easily. You may elaborate the answer based on personal views or your classwork if necessary.

(Answer) (1) Since Fan was a regular employee at her previous company “Yellowscope” it would mean that the injuries that she succumbed to, under their methods and directives, would make them responsible for it.

(2) Fan worked at Yellowscope where she received the injury. Later on, she started her own company called Blackspot. Even though she used the same methods that gave her the injury in the first place, it would not be fitting to sue Blackspot since the injury did not take place under the company time and directives that were behest by Blackspot.

For instance, If Fan would use a hammer for fixtures in John’s house under his orders and get injured, she could sue John. However, if Fan uses a hammer for similar work in Peter’s house, she cannot sue Peter because he didn’t give her the work assignment that caused her the injury even if the tools used are the same.

(3) Since Fane is the sole shareholder and director of the company, suing her own company would be redundant. However, since she is suing Blackspot for the kind of work she did there, and she does the same work at Yellowscope, it would be beneficial for the defendant. Yellowscope could claim baseless grounds for the case since Fan is adopting the same methods herself.

(4) On the grounds that Blackspot was the company under which the orders to do the work that injured her were given, it is very likely that Blackspot could be 100% liable. Regardless of the work method, an employer is responsible for his employees and for the consequences of the work they do while in the company.