An employer may be held vicariously liable for an employee's malicious actions if closely connected to the employee's duties within the scope of employment.

Introduction

[1] This appeal rests on the question of whether there ought to be imposition of liability on the employer for the wrongs of its employee. This raises a much larger question - in what circumstances should an employer be held liable for an intentional wrong committed by his employee in circumstances where no fault can be attributed to the employer?

[2] This question is usually understood in most common law jurisdictions as a question about vicarious liability, the development of which has been fashioned by judges with considerable impact on employment relationships and others connected with it. Such actions can also be considered on the principle of non-delegable duty (see Dalton v. Angus [1881] 6 App Cas 740 and Wilsons and Clyde Coal Co Ltd v. English [1938] AC 57) where direct liability is imposed as opposed to derivative liability. The latter case is not in issue here.

[3] The appellant in this case was not successful in the Magistrates Court at Kuala Lumpur in his attempt to impose vicarious liability on an employer whose employee had caused him financial harm. He now appeals to this Court. For convenience, the parties will be referred to as they were in the Court of first instance.

Background Facts

[4] The facts giving rise to the instant action can be stated as follows. The plaintiff had seen an advertisement in the China Press newspaper on the sale of the Mazda branded vehicles. On and about 13 August 2013, the plaintiff visited the defendants showroom in Subang Jaya, Selangor. The defendant was in the business of the distribution and sale of the Mazda brand of vehicles. At the showroom, the plaintiff was attended to by one Goh Khan Lee ("GKL") who was the defendants sales consultant.

[5] The plaintiff was interested in the vehicle known as Mazda CX-5. After a test drive, the plaintiff agreed to purchase the said vehicle for the "on the road" price of RM144,830.70.

[6] Whilst discussing the hire-purchase options and financing facilities with GKL, the plaintiff raised concerns about the financing margin for the hire purchase given that he had only recently returned to Malaysia. To alleviate the plaintiffs concern, GKL suggested that he could make a higher down payment. He then suggested to the plaintiff a sum of RM57,932.00 being 40% of the price of the said vehicle.

[7] Whilst preparing the cheque of RM57,932.00, GKL informed the plaintiff that the defendants owners had three other companies and that the payment need not necessarily be made in the defendants name. GKL requested the plaintiff to leave the payee name blank on the cheque so that once he received confirmation from his boss, he could write down the companys name on the cheque.

[8] The defendant then prepared a CIMB Cheque No: 678201 amounting to RM57,932.00 dated 13 August 2013 without the payees name and passed it to GKL. The cheque was photocopied and the copy was given to the defendant. The copy had the defendants stamp that stated "Received From and on behalf of Excel Champ Only" and it was signed and dated by GKL. GKL told the plaintiff that it will take three to four days to complete the documents and he will contact the plaintiff once it is done.

[9] After a few days, the plaintiff called GKL to inform him that he wished to cancel the booking for the Mazda CX-5. GKL told him that it was not a problem but the cancellation will incur a RM200.00/- administrative charge. The plaintiff agreed. GKL said he will prepare a refund of RM57,732.00.

[10] On 5 September 2013, the plaintiff received a Public Bank cheque dated 9 September 2013 from GKL at the defendants showroom. The cheque was issued by Sing Hong Tractor & Construction ("Sing Hong"). On 1