1. Definition

• Vicar means someone who acts in place of another person. It means a substitute.
• Vicarious liability means being legally responsible for wrongful acts committed by another person.
• Normally, a person is only responsible if they did something wrong by themselves. But sometimes a person can be responsible for wrongs done by someone else.

1.1. Examples of Vicarious Liability

Here are some examples of vicarious liability:

a. Master and Servant: If a servant (like a housekeeper or a gardener) does something wrong while working for their master (like a homeowner), the master can be held responsible for the servant’s actions.

b. Principal and Agent: If an agent (like a salesperson) does something wrong while working for their principal (like a company), the principal can be held responsible for the agent’s actions.

c. Owner of a Firm and Partner: If a partner in a business does something wrong, the owner of the firm can be held responsible for the partner’s actions.

1.2. Important Note

Vicarious liability is not a type of wrongdoing or tort in itself. It’s a way of holding someone responsible for the actions of another person. So, if someone is found to be vicariously liable, it means they are responsible for the actions of someone else, but they didn’t necessarily do anything wrong themselves.

1.3. Employer and Employee

In the case of an employer and employee, the employer is vicariously liable for the employee’s actions. This means that if an employee does something wrong while working for the employer, the employer can be held responsible. However, the employee is also directly responsible for their own actions. In practice, an employee would only be held directly responsible if they did something deliberately wrong.

2. Master and Servant

2.1. Basis of Master’s Liability for acts of Servants

• Principles that explain why a master is liable for the acts of their servants:
  1. Respondent Superior
     • This Latin phrase means “let the superior (or principal) be liable.” In simple terms, it means that the master is responsible for the actions of their servant because the servant is acting on the master’s behalf. The idea is that the servant is following the master’s instructions, either directly or indirectly, so the master should be held accountable for what the servant does.
     • For example, imagine a company hires a delivery driver to transport goods to customers. If the driver gets into an accident while making a delivery, the company (the master) may be held responsible for the damages because the driver was acting on their behalf.
  2. Nam qui facit per alium facit per se
     • This Latin phrase means “he who does an act through another is deemed in law to do it himself.” This principle is similar to the first one. It says that when a servant does something while working for the master, it’s as if the master did it themselves. This is because the servant is acting under the master’s authority and following their instructions.
     • Using the same example as before, if the delivery driver gets into an accident, it’s as if the company (the master) got into the accident themselves. The company is responsible for the driver’s actions because they hired the driver to do a job on their behalf.
  3. Power of Selection
     • This principle is based on the idea that the master has the power to choose who they hire to work for them. If the master hires someone who is not competent or qualified for the job, and that person causes harm or damage while working, the master is responsible. This is because the master should have taken more care in selecting a qualified employee.
     • For instance, if a company hires a construction worker who doesn’t have the necessary experience or training, and that worker causes an accident on the job site, the company may be held liable. This is because the company should have been more careful in selecting a qualified worker.
  4. Power of Control
     • This principle is based on the idea that the master has control over the servant’s actions. The master can:
       • Punish the servant if they do something wrong
       • Fire the servant if they’re not doing their job properly
       • Tell the servant how to do their job
       • Control the servant’s work to make sure it’s done correctly
     • Because the master has this control, they should be responsible for the servant’s actions. If the servant makes a mistake or causes harm to someone, the master should be held accountable. This is because the master had the opportunity to prevent the mistake or harm from happening.
     • For example, imagine a restaurant hires a chef to cook food for customers. If the chef accidentally serves spoiled food to a customer, who gets sick as a result, the restaurant (the master) may be held responsible. This is because the restaurant had the power to control the chef’s actions, such as training them on food safety procedures or supervising their work.
  5. Beneficiary of Services
     • This principle is based on the idea that the master benefits from the servant’s work. The master hires the servant to do a job, and the master gets the benefits of that job. If the servant makes a mistake or causes harm while doing their job, the master should also bear the losses.
     • Using the same example as before, the restaurant benefits from the chef’s work by serving food to customers and making a profit. If the chef makes a mistake and a customer gets sick, the restaurant should bear the losses, such as paying for the customer’s medical bills or compensating them for their suffering.
  6. Distribution of Loss
     • This principle is based on the idea that when a servant causes harm or damage, the loss should be spread out among those who benefit from the servant’s work. In other words, the master, who benefits from the servant’s work, should share the responsibility for the losses.
     • For example, imagine a company hires a truck driver to transport goods to customers. If the driver gets into an accident and causes damage to someone’s property, the company (the master) may be held responsible for the damages. This is because the company benefits from the driver’s work by transporting goods and making a profit. By holding the company responsible, the loss is distributed among those who benefit from the activity.
  7. Public Policy
     • This principle is based on the idea that holding the master responsible for the servant’s actions is good for society as a whole. It’s a way of promoting responsible behavior among employers and encouraging them to take steps to prevent harm or damage from occurring.
     • For example, if a company knows that they can be held responsible for their employees’ actions, they may be more likely to provide training on safety procedures or implement policies to prevent accidents. This helps to create a safer and more responsible work environment, which benefits everyone.

2.2. Who is a Servant?

• In the Case of Short v. J. W. Henderson Ltd. (1946) the court, outlined four essential elements that define a master-servant relationship. These elements help determine whether a person is a servant or not in a particular situation. The Four Essential Elements:a) The master’s power of selection of a servant.
  • This means that the employer (master) has the authority to choose who they want to hire as an employee (servant). The employer decides who is suitable for the job and selects the person they want to work for them.
  b) Payment of wages or other remuneration.
  • This element involves the payment of wages, salary, or other benefits to the employee (servant) in exchange for their work. The employer provides compensation to the employee for their services.
  c) Right to control the method of doing work.
  • This element is crucial. It means that the employer (master) has the authority to direct and control how the employee (servant) performs their job. The employer can instruct the employee on how to do their work, what tasks to prioritize, and how to achieve the desired results.
  d) Right of suspension or dismissal.
  • This element gives the employer (master) the power to discipline, suspend, or terminate the employment of the employee (servant) if they fail to meet expectations or violate company rules. The employer has the authority to take disciplinary action against the employee if necessary.

2.3. Independent Contractor

2.3.1. General Rule for Employer Liability

• Employer’s Employees: Generally, if an employee (servant) does something wrong while doing their job, the employer is responsible for that wrong act. This is because the employee is doing their work under the employer’s control.
• Independent Contractors: Generally, if an independent contractor does something wrong, the employer who hired them is not responsible. The independent contractor is responsible for their own actions.

2.3.2. Exceptions to the General Rule

There are some situations where an employer can be responsible for the wrong acts of an independent contractor. Let’s look at these exceptions:

1. Personal Fault of the Employer:
   • What it means: If the employer hires someone who is not capable of doing the job properly (incompetent) and this person causes harm, the employer can be held responsible.
   • Why: Because the employer neglected their duty to hire a competent person. It’s like saying, “You should have known better than to hire this person.”
2. Unlawful Job:
   • What it means: If the job itself is illegal, and the independent contractor does something wrong while doing this illegal job, the employer cannot avoid responsibility.
   • Why: Because the employer should not have asked someone to do something illegal in the first place.
3. Extra Hazardous Work and Non-Delegable Duties:
   • Extra Hazardous Work:
     • What it means: If the work is very dangerous (extra hazardous), the employer can be held responsible for any harm caused by the independent contractor.
     • Why: Because the law wants to make sure someone is responsible for making sure dangerous work is done safely.
   • Non-Delegable Duties:
     • What it means: Some duties are so important that the employer cannot pass on the responsibility to someone else (they cannot delegate the duty). If an independent contractor causes harm while doing these important duties, the employer is still responsible.
     • Why: Because the law says these duties are too important to be left to someone else. The employer must ensure they are done properly.
   • Rylands v. Fletcher: The Rule Explained
     • The rule from the case of Rylands v. Fletcher is a legal principle that deals with the responsibility of a person (the defendant) for certain types of damage caused to another person (the plaintiff).
       1. Background of the Case:
          • In this case, the defendant had a reservoir built on their land. A reservoir is a large storage area for water.
          • The defendant hired an independent contractor (a separate person or company) to build the reservoir.
          • Due to a mistake made by the independent contractor, water from the reservoir escaped and caused damage to the plaintiff’s property.
       2. Key Point of the Rule:
          • The defendant was held liable (responsible) for the damage caused by the escape of water from the reservoir, even though it was the independent contractor’s fault.
       3. Understanding the Rule:
          • Non-natural Use of Land: If a person uses their land in a way that is not ordinary or natural (for example, building a reservoir), they must be extra careful.
          • Bringing Something Potentially Dangerous: If a person brings something onto their land that could cause damage if it escapes (like water in a reservoir, fire, or animals), they are responsible for controlling it.
          • Liability for Escape: If that thing escapes and causes damage, the person who brought it onto their land is liable, meaning they must pay for any damage caused.
       4. Details of Liability:
          • Peril (Risk): Keeping something potentially dangerous on your land comes with a risk. If it escapes, you are responsible for any harm it causes.
          • Independent Contractor: It does not matter if you did the work yourself or hired someone else (an independent contractor). You are still responsible for any damage that results from their work.
       5. Examples of the Rule in Action:
          • Fire: If you have a fire on your property and it spreads to a neighbor’s property, causing damage, you could be held liable.
          • Animals: If you keep animals on your land and they escape and cause damage to someone else’s property, you could be held liable.

2.4. When it is a Course of Employment?

• “Course of Employment” refers to the actions an employee takes while doing their job. It helps decide if an employer is responsible for something wrong (a tort) the employee does.
• The Salmond Test
  • To determine if an employer is responsible for an employee’s wrong act, a test called the Salmond Test is used. This test was created by Professor Salmond in 1907. The test has two parts:
    1. Authorized wrongful act: Did the employer ask the employee to do something wrong or harmful? If yes, the employer is responsible.
    2. Unauthorized Modes of Doing Authorized Acts: Did the employee do something wrong or harmful while trying to do their job, but not exactly as they were told to do it? If yes, the employer might still be responsible.
• Changes in Lister v Hesley Hall (2001)
  • In 2001, the House of Lords made a change to the second part of the Salmond Test. They introduced a new way to look at it:
  • Close Connection Test: Is there a close connection between the wrongful act (tort) and the employee’s job?
• An act is considered done in the course of employment if it falls into any of these categories:
  1. Authorized Acts and Their Natural Consequences: If the employer told the employee to do something, and that something led to a wrong or harmful act, the employer is responsible.
     • Example: If a delivery driver is authorized to deliver packages and they accidentally damage property while doing so, the employer may be liable.
  2. Unauthorized Modes of Doing Authorized Acts: If the employee did something wrong or harmful while trying to do their job, but not exactly as they were told to do it, the employer might still be responsible.
     • Example: If the delivery driver decides to take a shortcut through someone’s yard and causes damage, even though they weren’t authorized to do so, the employer may still be liable.
     1. Negligent Exercise of Authorized Acts
        • If the worker causes damage while doing something they were allowed to do, but does it carelessly, the boss is still responsible.
        • Example Case: Century Insurance v Northern Island Road Transport Board (1942)
          • Facts: A worker was delivering petrol and threw away a lit match, causing an explosion.
          • Decision: The worker was doing his job (delivering petrol) even though he was careless. The employer was held responsible.
     2. Mistake of Servant:
        • If the worker makes a mistake while doing their job, the boss is usually responsible.
     3. Fraudulent Acts by Servant for Own Benefit:
        • If the worker does something wrong to benefit themselves, the boss can still be responsible, even if it goes against the boss’s interests.
     4. Willful Disobedience of Instructions:
        • If the worker deliberately disobeys the boss’s instructions, the boss can be held responsible depending on the case details.
     5. Deviation:
        • If the worker slightly strays from their work but is still on the job, the boss is responsible.
        • If the worker completely goes off on their own for personal reasons (a “frolic”), the boss is not responsible.
     6. Delegation of Duties by Servants:
        • If the worker delegates their job to someone else with the boss’s permission, the boss is responsible for any mistakes.
        • If they do it without permission, the boss is not responsible.
     7. Lending of Servant:
     • If a worker is temporarily sent to work for someone else, who is responsible for their mistakes depends on who controls the worker at that time.
     • Case: Mersey Docks and Harbour Board v Coggins & Griffiths (1947)
       • Facts: A driver employed by one company (MDHB) was hired out to another (C&G). C&G controlled what he did, but MDHB paid him and could fire him.
       • Decision: The original employer (MDHB) was still responsible because they had more control over the driver.
     • Case: Viasystems Ltd v Thermal Transfer Ltd [2005]
       • Sometimes, both the original employer and the temporary employer can be responsible.
       • Facts: Company V hired TT to install air conditioning. TT subcontracted to D Ltd, who further subcontracted to CAT. Two fitters from CAT caused a flood while supervised by H, working for D Ltd.
       • Decision: Both D Ltd and H had control over the fitters. Both were held responsible for the damage.
       • Summary Diagram Explanation:
         1. V hired TT.
         2. TT subcontracted work to D Ltd.
         3. D Ltd subcontracted to CAT, providing fitters (M and S).
         4. H supervised M and S.
         5. The fitters’ work caused damage.
       • Conclusion:
         • Both D Ltd and H were responsible because they both had control over the fitters’ work.
  3. Incidental Acts: If the employee did something wrong or harmful that is closely related to their job, even if it wasn’t exactly what they were supposed to do, the employer might still be responsible.
     • Example: If the delivery driver stops for lunch and accidentally causes damage nearby, the employer might be liable if the lunch break is seen as incidental to the job.

2.5. Independent Contractor VS Servant

• Imagine you need someone to help you with a task, like fixing your house or designing a website. You have two options:
  1. Employee: You hire someone to work for you directly. You tell them what to do, how to do it, and when to do it. You also provide them with the tools and equipment they need to do the job. In return, you pay them a salary or wage.
  2. Independent Contractor: You hire someone to do a specific job, but they work for themselves, not for you directly. They decide how to do the job, when to do it, and what tools to use. You pay them for the job they do, but you don’t control how they do it.
• Courts use three main tests to decide whether someone is an employee or an independent contractor:1. Control Test
  • If someone has control over another person’s work, telling them what to do and how to do it, that person is likely an employee.
  • This test was important in the past when many people didn’t have specialized skills. However, in today’s society, where people are more educated and skilled, this test is not as important.
  2. Organization Test (or Integration Test)
  • If the worker is essential to the business and works as part of the organization, they are likely an employee.
  • For example, a surgeon working in a hospital is integrated into the hospital and is an employee.
  • This test is tricky to apply in real situations because some roles don’t fit neatly into being “part” of the business or not.
  3. Economic Reality Test (or Multiple Test)
  • This test looks at the whole situation to decide whether someone is an employee or an independent contractor.
  • The court considers many factors, such as:
    • Method of payment: Is it regular, like a salary? (Employee) or is it based on the job done? (Independent Contractor)
    • Tax: Is tax deducted from the payment? (Employee) or does the person pay their own taxes? (Independent Contractor)
    • Tools: Are they provided by the employer? (Employee) or does the person use their own tools? (Independent Contractor)
    • Business risks: Does the person take risks, like owning their own equipment? (Independent Contractor) or does the employer take the risks? (Employee)
    • Hours: Are the hours regular, like a 9-to-5 job? (Employee) or does the person work flexible hours? (Independent Contractor)
  • A famous court case: Ready Mixed Concrete v Minister of Pensions and National Insurance [1968]
    • In this case, the court had to decide whether truck drivers who delivered concrete were employees or independent contractors. The drivers were paid a fixed rate per mile, had to buy their own trucks, maintain and insure them, and wear company uniforms. The court decided that the drivers were independent contractors because they owned their own trucks and took the risk of loss.
    • Three conditions for someone to be an employee
      • Based on this court case, the court set out three conditions for someone to be an employee:
        • The worker agrees to work for wages.
        • The worker agrees to be under the employer’s control.
        • Other terms of the job are consistent with being an employee.

2.6 Principal and Agent: How to make the principle liable

2.6.1. Basic Definitions

1. Principal: A principal is a person or entity who hires another person to perform a task on their behalf. Think of the principal as the boss.
2. Agent: An agent is the person hired by the principal to carry out tasks. The agent acts on behalf of the principal.

2.6.2. When is the Principal Liable for the Agent’s Actions?

1. Authorized Acts
   • If the principal tells the agent to do something, and the agent does it, the principal is responsible for the results, even if the action causes harm (called a “tortious act”).
   • Example: If a principal asks an agent to deliver a package, and the agent accidentally breaks someone’s window while delivering it, the principal is responsible for the damage.
2. Ratification by Principal
   • Sometimes an agent might do something that the principal did not specifically ask them to do. If the principal finds out about it later and says it’s okay (ratifies it), the principal becomes responsible for that action.
   • Example: If an agent buys supplies without asking the principal first, and the principal later agrees that the purchase was a good idea, the principal is then responsible for paying for those supplies.
3. Acts Within the Scope of Authority
   • If the Agent does something that is within their job description or authority, the Principal is responsible for the action, even if they didn’t give permission or agree with it.
   • Example: A salesperson (Agent) is authorized to sell products within a certain price range. If they sell a product at a price within that range, but the customer is unhappy with the product, the company (Principal) is responsible for the sale.