Vicarious Liability

Employer Liability

 If an employer expressly authorizes their employee to commit a tort, who will be

primarily liable?
 What if he authorizes only impliedly and not explicitly or there is no authorization
proven.
 Can he still be held liable for the actions of his employee?
Vicarious Liability

 “Liability on you for acts done by another person”

 Example: Liability of an employer, if their employee commits a tort.
 Is this compatible with the fault doctrine?
Justifications for VL

 Previously:
Legal fiction of ‘control’ of employer over employees.
 Now:
Pragmatic reasons:
Employers, as opposed to employees, are better placed to
compensate injured third parties.
Some professions should be afforded protection from being
sued directly e.g Doctors etc.
What can be other such pragmatic reasons?
Why was vicarious liability developed?

 Situations where tortfeasor is unidentifiable

 Where he runs away
 Where the tortfeasor cannot afford to pay?

 Similarity with joint liability and joint and several liability?

Who are not employees

 Independent contractors (subject to exceptions)?

 Sub-contractors?
 Cash-in-hand job holders?
 ‘As-required’ basis employees?
The control test
 How much control did the employer have over the manner in which the work was
carried out?
 If the employer is able to tell the person engaged to do a particular job how the
work should be done, the contract will usually be an ordinary employment
contract and the person doing the work will be a servant rather than an
independent contractor.
 Criticism
Example (Criticism)

 Captains of a ship owned by an oil company.

 Doctors in a hospital owned by a silicon valley billionaire.
Proposition

 A security provider is charged with safeguarding a bank. The bank manager tells
then security guards their duties and gives them a schedule and issues them
regular instructions. In case, the guards commit a tort who can be held vicariously
liable.

1. The bank manager

2. The security company
3. The Bank
4. Vicarious liability does not apply here
Solution

 In Hawley v Luminar Leisure plc [2005] EWHC 5 (QB):

 It was held that where a night-club owner exercised detailed control over
‘bouncers’ employed by a security services company as to how they were to do
their job, the nightclub owner was vicariously liable as the bouncers were treated
as employees of the club.
Conclusion (Control Test)

 As a means of assessing contractual status for the purpose of vicarious liability

the control test is artificial, outdated and only partially helpful, and indeed
this is reflected in the fact that judges now place less emphasis upon this test.
The integral part of the business test

 Proposed by Lord Denning in Stevenson Jordan and Harrison Ltd v McDonald

and Evans [1969] 2 QB 173:
‘Under a contract of service, a man is employed as part of the business; whereas under a
contract for services, his work, although done for the business, is not integrated into it but
is only accessory to it.’
Difference b/w contractual employees and
contractors
 People who have a ‘contract of service’ (an employment contract) are employees.
 People who have a ‘contract for services’ (a service contract) are independent
contractors.
Criticism of this test

 Ready Mixed Concrete case

 Often, people who are casual or part time employees are treated as part of a
business, whereas they would not necessarily regard themselves as totally
committed to it. Part time teachers and markers and examiners for public
examination boards are treated as employees for the purposes of income tax, but
this type of employment is often regarded by them as a supplement to their main
income, and a secondary source of employment, and most would regard
themselves as independent contractors.
Proposition 2

 A student forgets to bring his student card and is stopped at the GCU gate. On his
failure to produce the card, he is denied entrance. He starts a quarrel and is met
with a reaction from the guards. The guards assault the student.
 Is GCU liable in this scenario?
 What would the judge assess in this scenario?
How to distinguish b/w employees and
contractors
 Who owns the tools?
 Is the worker paid a wage or a lump sum for the job?
 Was the worker in business on his own account?
 Who had the power to hire and fire the employee?

 Inconclusive points that are not general

The course of employment requirement

 Limpus v London General Omnibus Co (1862) 1 H & C 526

 Racing bus drivers
 Weir v Chief Constable of Merseyside Police [2003] EWCA Civ 111
 Policemen and his paramour

 Examples on page 361-362

 Presentations
Conclusion (Course of employment)

 Vivienne admits that the task to formulate a general principle from these cases is a
daunting one, yet she is able to give us a rule. She says that if the person who is
injured was performing some act which contributed to, or provided some benefit
to, the business of the employer, there will be vicarious liability (Rose v Plenty).
 If the employer derives no benefit from the forbidden act (Twine v Beans
Express [1946] 1 All ER 202) there may be no vicarious liability.
Criminal Activities

 Should an employer be responsible for ‘deliberate’ criminal acts of his employee?

 What if the theft is of a good that forms the part and parcel of the job?
 Morris v Martin & Sons [1966] 1 QB 792
 An employee stole a fur coat from owner’s dry cleaner’s, employer held liable.
 Does this seem fair to you?
 For the claimant
 For the owner
Conclusion
(Criminal Activities)
 The position in relation to crime per se is that employers will not normally be
prosecuted for the crimes of their employees, unless the employee was instructed
to commit the crime in question, or committed it under duress.
 Tort actions may arise out of the same fact situations as certain crimes (for
example, assault and battery) and it is these torts for which the employer may be
vicariously liable.
Conclusion of the topic

 The court will decide the status of each individual in the light of all the
circumstances.
 There is no general rules and each case of vicariously liability is to be adjudged
individually.
 Thus, it has been held that even a controlling shareholder may be an employee.
(Secretary of State for Trade and Industry v Bottrill [2000] 1 All ER 915).
Potential Exam Questions

 Vivienne thinks that the practice of looking for general principles on vicarious
liability from cases is futile, do you agree?
 Do you believe vicarious liability should apply in crimes just as it applies in torts?
 Compare the typical reason behind vicarious liability with its pragmatic
counterparts and state your preference.