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Tort Module 3

Vicarious liability holds a principal liable for the acts of their agents/servants. There are three main reasons for this: 1) the principal benefits from and controls the actions of their agents, 2) the principal is usually in a better financial position to pay damages than the agent, 3) the principal should ensure their agents act responsibly. Vicarious liability can arise through ratification of acts, relationships like master-servant, or abetting a tort. Determining whether someone is a servant or independent contractor depends on factors like control over work and financial risk. Vicarious liability does not apply in some cases like between contractors.

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61 views17 pages

Tort Module 3

Vicarious liability holds a principal liable for the acts of their agents/servants. There are three main reasons for this: 1) the principal benefits from and controls the actions of their agents, 2) the principal is usually in a better financial position to pay damages than the agent, 3) the principal should ensure their agents act responsibly. Vicarious liability can arise through ratification of acts, relationships like master-servant, or abetting a tort. Determining whether someone is a servant or independent contractor depends on factors like control over work and financial risk. Vicarious liability does not apply in some cases like between contractors.

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VICARIOUS LIABILITY

MODULE 3
PRINCIPLES OF VICARIOUS LIABILITY

• respondent superior – the principle must answer for the acts of his subordinates
• Qui facit per alium facit per se- he who employs another person to do something, does it
by himself
WHY HOLD THE PRINCIPAL LIABLE?

• The principal has a better sound monetary position compared to the agent
• The principal controls the agent/servant
• The principal benefits from the actions of the servant
MODES OF MANIFESTATION OF VICARIOUS
LIABILITY
• By ratification (Omnis ratihabitio retrotrahitur et mandato priori aequiparature:
every retification is retrospective & is of equal force with a previous command)

The agent’s act that is ratified must have been done expressly on the principal’s behalf.
The third-party with whom the agent contracted must have been aware that the agent was
acting not for himself but on behalf of the principal. If the agent had not earlier disclosed
to the third party that he was acting for another, then the principal cannot later ratify that
act. Keighley Maxsted & Co. v Durant [1901] AC 240
MODES OF MANIFESTATION OF VICARIOUS
LIABILITY
• By ratification (Omnis ratihabitio retrotrahitur et mandato priori aequiparature:
every retification is retrospective & is of equal force with a previous command)
• Subsequent act or omission of the agent/servant must have been done at the time on
behalf of the principal/master
• The person ratifying must have full knowledge of its tortious character
• An act which is illegal and void is incapable of ratification

Keighley Maxsted & Co. v Durant [1901] AC 240


MODES OF MANIFESTATION OF VICARIOUS
LIABILITY
• By relationship

a) Master and Servent


b)Owner and Independent Contractor
c)Principal and Agent
d) Company and Directors
e)Firm and Partner
f)Guardian and Ward

If the husband has expressly informed traders not to supply any goods on credit to his wife, then it is
unlikely that the husband will be liable for the debts incurred by the wife as his agent. Harris v Morris
(1801) 170 ER 635.
MODES OF MANIFESTATION OF VICARIOUS
LIABILITY
• By abetment

Lloyds Bank Ltd v Chartered Bank of India, Australia and China (1929) 1 KB 40,
WHO IS A SERVANT ?

• One who lends his labour/skills in consideration for wages or other remuneration for
the benefit of the one who pays the consideration (master)
• He agrees to be subject to the control of the person who pays the consideration
(master) – control test and organisational test
• The relationship is established through a contract of service and not a contract for
service
TEST TO DETERMINE VICARIOUS LIABILITY

• Control Test Yewen v Noakes [1880] 6 QBD 530


A person was an employee if his employer has the right to control not only what work
he does but the way in which that work is done.’
• Organization/Integration Test Stevenson, Jordan & Harrison Ltd vs MacDonald &
Evans (1952), There is a vicarious liability if a man is employed as part of the business
and his work is done as an integral part of the business
SUPREMACY OF ORGANIZATIONAL TEST

• Hollis vs Vabu Pvt Ltd (2001)ALJR 1356: Control will no doubt always have to be
considered, although it can no longer be regarded as the sole determinant. Other facts that
needs to be taken into consideration include: 1) whether the man providing the service uses
his own equipment, 2) whether he hires his own helpers, 3)what degree of financial risk he
takes,4) What degree of responsibility for investment and management he has, 5)How far he
has an opportunity for profiting from the sound management of the task.

• Santa Garg vs. Director of National Health Institute AIR 2004 SC 5088
The Hospital Authority is liable for the negligence of professional men employed by the
authority under the contract for service and the contract of service.
CONTRACT OF SERVICE
VS.
CONTRACT FOR SERVICE
• Stevenson, Jordan & Harrison Ltd vs MacDonald & Evans (1952)
Under a contract of service a man is employed as part of the business and his work is an
integral part of the business,

Under contract for service, his work although done for the business, is not integrated into
it but only accessory to it.
LENDING OF SERVANTS

• The lender (General Employer)


• The Borrower (Particular Employer)
• There is a strong presumption the general employer continues to be the master
• The burden is on the general employer to prove that there is a transfer of service
• The burden of proof can only be discharged where the master establishes that the
absolute control over the servant was transferred to the Particular employer with the
expressed or implied consent of the servent
• Mersey Docks & Harbour Board vs. Coggins & Griffiths Ltd (1946)
DIFFERENCE B/W INDEPENDENT CONTRACTOR
AND SERVANT
Servant Independent Contractor
Subject to the control and supervision of the Is not subject to any such contract
employer regarding the manner in which the
work is to be done
Acting under dictation from the employer most Acting under discretion
of the time.
Under takes to implement directions Undertakes to produce a given result
Generally Master Vicariously Liable Generally Master Vicariously not Liable
DIFFERENCE B/W INDEPENDENT CONTRACTOR
AND SERVANT
• Morgan vs Incorporated Central Council (1936) 1 All E.R 404: Failure of a Lift maintained by an
independent contractor
• Burgess vs Grey (Gravel Case) [1845]: An independent contractor employed by the defendant to
construct a drainage system left a heap of gravel on the road, which the defendant instructed to leave as
it is for the time being as the defendant himself will cart it away later on.
• Ellis vs Sheffield Gas Consumer Co. [1853]: Gas company not authorized to interfear with the streets
of Sheffield directed the contractor to open trenches there in leaving behind a heap of stones
• Grey vs Pullen (1864): A was empowered under an Act to make a drain from his premises to a sewer
by cutting a trench across the highway and filling it up after its completion
DIFFERENCE B/W INDEPENDENT CONTRACTOR
AND SERVANT
• B.Govindarajulu vs MLA Govindaraja Mudaliar (AIR 1966 Mad.332): Failure of the
mechanic to repair the truck properly resulting in accident.
• Ramu Tularam vs. Amichand (1968) ACJ 54 : Application of contract of agency in
the relationship between vehicle owner and the mechanic
• Rajasthan State Road Transport Corporation vs K.N Kothari (AIR 1997 SC
3444
• Workmen Compensation Act 1923 Sec.12 (2)
• M V Act 1988 Sec.165 -166
VICARIOUS LIABILITY IN THE COURSE OF
EMPLOYMENT
• Poland vs. John Parr & Sons (1927)
1. wrongful act authorised by the master, or
2. an authorized act is done in a wrongful manner
• National Insurance Co, Kanpur vs.Yogendra Nath (AIR 1982 All. 385): Master
ordered the servant to look after the car and keep it dusted while he was gone for a long trip
• Gopalakrishnan vs. Krishnankutty AIR 1967 Ker 19:
• National Insurance Co, vs.Yogendra Nath (AIR 1982 All 385)
• Storey vs. Ashton (1869) LR 4 QB 476
CASES WHEREIN VICARIOUS LIABILITY IS ABSENT

• Employer and Independent Contractor


• Employer and Servant of the independent contractor
• Between an employer and a subcontractor
• When the employer lends his servant to the contractor
• Between Fellow Servants

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