LAW OF TORT ASSINGMENT ON VICARIOUS LIABILITY

BY :- ANJALI GUPTA BBA LLB 1ST YEAR (2ND SEMESTER)

-1-

CONTENTS

Topic

Page No:

Introduction Types of liability Case of master & servant Owner & independent contractor Vicarious liability of state Case (State Bank of India Vs Shyama Devi) Latin Maxim Conclusion Bibliography

1 3 4 7 8 12 13 15 17

-2-

INTRODUCTION

The law of tort has been used for many centuries to protect personal interests such as property, reputation, body etc. It ensures justice is done by looking into the claimant's need for compensation, which is paid by the defendant who has committed a breach of duty. The general rule in tort law is that liability is personal, i.e., liability is generally linked to a breach of ones own duty and a person is liable for the wrongs committed by him only. However, in certain scenarios, the law makes one person being liable for the harm caused by another, because of some legally relevant relationship between the two. This is known as the doctrine of vicarious liability

The doctrine of vicarious liability generally operates within the law of torts. It has become well-established in English law and historically has been called Master and Servant liability. Vicarious liability means liability which is incurred for or instead of, another. A person is responsible for his own acts. But there are circumstances where liability attaches to him for the wrongs committed by others. The most common instance is the liability of the master for wrongs, committed by his servant. In these cases liability
-3-

is joint as well as several. The other common example of vicarious liability is the liability of an employer for the torts of his employees committed in the course of employment. It is not necessary in such circumstances for the employer to have breached any duty that was owed to the injured party, and therefore it operates as strict or no-fault liability. It is possible that the injured party could be either an employee or a stranger, and the employer can be held vicariously liable in both situations. The most important element to establishing a case for vicarious liability is that the wrongdoer be acting as a servant or employee, and that the wrong done be connected to the employees course of employment. Vicarious liability can only be imposed if it is proved that the employee was acting in the course of employment. This criterion is essential, and requires a clear connection between the employment duties and the employe es acts complained of. A reason for vicarious responsibility of employers is that employers usually are, while their servants usually are not, financially capable of the burden of civil liability. The theory partly owes its existence to the anxiety of the injured person to find a solvent defendant. Again it is said that the employer should be made liable because it is he who has set the whole thing in motion. Chief Justice Shaw of the Massachusetts Supreme Court in the case of farewell v. Boston and Worcester Rly. Co. Stated that this rule is obviously founded on the great principle of social duty, that every man in the management of his own affairs whether by himself or by his agents or servants shall so conduct them as not to injure another; and if he does not and another thereby sustains damage, he shall answer for it. If done by a servant in the course of his employment acting within the scope of his authority it is considered in contemplation of law, so far the act of the master, that the latter shall be answerable civiliter. The maxim respondeat superior is adopted in that case from general considerations of policy and security.

TYPES OF LIABILITY

1. LIABILITY BY RATIFICATION: An act done for B by A not for himself but for B though without the authority of B becomes the act of the principle B if subsequently ratified by B. If one person commits a tort assuming to act on behalf of another but without his authority and that other subsequently ratifies
-4-

and assents to that act, he thereby becomes responsible for it. The person ratifying the act is bound by the act whether it to be his detriment or advantage. Maxims i. Omnis ratihabitio retrorahitur et mandato priori aequiparatur : every ratification of an act relates back and thereupon becomes equivalent to a previous request. ii. Qui facit per alium facit per se: Any person who authorises or procures a tort to be committed by another is responsible for that tort as if he had committed it himself. The person authorising is liable not only for the tort actually authorised, but also for its direct consequences.

Conditions of ratification 1. Only such acts bind a principal by subsequent ratification as were done at the time on his behalf. 2. The person ratifying the act must have full knowledge of its tortuous character. 3. An act which is illegal and void cannot be ratified.

2. LIABILITY ARISING OUT OF SPECIAL RELATIONSHIP: Vicarious liability may arise where the doer of the act and the person sought to be held liable therefore are related to each other as: 1. Master and Servant. 2. Owner and Independent Contractor. 3. Principal and Agent. 4. Firm and its Partner. 5. Guardian and Ward. 6. Company and its Directors.

CASE OF MASTER AND SERVANT

A servant is a person who voluntarily agrees, whether for wages or not, to subject himself at all times during the period of service to the lawful orders and direction of another in respect of certain work to be done. A master is the person who is legally entitled to give such orders and to have them obeyed.

-5-

A master is liable to third persons for every such wrong of his servant as is committed in the course of his employment. Now, a wrongful act is said to be done in the course of masters employment if it is- (1) authorised by the master or (2) a wrongful and unauthorised mode of doing an act authorised by the master. In other words, to hold a master liable for the wrongful act of a servant it must be committed in the course of masters business, so as to form part of it, and not merely coincident in time with it. For torts committed in any manner beyond the scope of employment, the master is liable if he has expressly authorised, or subsequently ratified them. Course of Employment An employer will only be liable for torts which the employee commits in the course of employment. Although this is a question of fact in each case, there is little consistency in the decisions. It is therefore extremely difficult to state the law simply. Course of employment is legal considerations of all circumstances which may occur in the performance of a person's job, especially during a period of time where specific objectives are given by the employer to the employee are being fulfilled. The course of employment encompasses the actual period of employment and the period during which the employee, while on the employer's premises, prepares to commence or to depart from work, such as by changing clothes. Employer-sponsored recreational activities are also considered part of the course of employment when organized, encouraged, or supported by the employer for business purposes, such as promotion of inefficiency. For an act to be considered within the course of employment it must either be authorized or be so connected with an authorized act that it can be considered a mode, though an improper mode, of performing it. In other words, an act can be said to be within the realm of course of employment if it is either an authorized act or a wrongful way of doing an authorized act. If an employee expressly authorizes an unlawful act, he or she will be primarily liable. The position is more difficult in cases in which the employer is said to have authorized a wrongful act by implication.

This 'implied authority' approach seems to have lost currency but it was accepted in the early 20th century10 and it was even then probably little more than a means of justifying the outcome which the courts desired.

-6-

An employer will usually be liable for acts which are wrongful ways of doing something authorized by the employer, even if the acts themselves were expressly forbidden by the employer. The court should determine the fundamental question of whether the wrongful act is sufficiently related to conduct authorized by the employer to justify the imposition of vicarious liability. Where there is a significant connection between the creation or enhancement of a risk and the wrong that occurs, the employer can be held vicariously liable. To determine the sufficiency of the connection, the following factors should be considered: 1.the opportunity afforded for the employee to abuse his power; 2.the extent to which the act is furthered by the employer's aims; 3.the extent to which the act is related to friction, confrontation, or any other kind of tort 4.the extent of the power of the employee over the victim; and, 5.The vulnerability of the potential victims.

This principle was applied in many cases like Rose v.Plenty.12 In this case, a milkman had been forbidden by his employer to allow young boys to ride on the milk floats and assist in delivering milk. However, he took a 13-year-old boy to help him on his round, and the boy was injured through the milkman's negligent driving. The boy sued both the milkman and the dairy. The Court of Appeal held that the milkman was carrying out, albeit in a prohibited manner, the task which he was employed to do, so the employer was liable.

In another case, L im pus v. London General Omnibus Co.13 a bus driver racing to a stop to collect passengers deliberately obstructed the driver of a bus of a rival company, overturning the latter's vehicle. This was done despite express prohibition by his company against obstructing other buses. However, the defendants were liable. The

-7-

rationale was that the driver was acting within the course of his employment at the time; it was immaterial whether his act was forbidden.

An act in defiance of a prohibition which deals with conduct with in sphere of employment (i.e.: how, when, where etc tasks are performed) will not be outside the scope of employment -the employee would be doing the right services but in the wrong way: employer is liable However, a master will not be liable for the servants negligence in doing something which he was merely permitted to do and does so for his own purposes. This was seen in the case Crook v. Derbyshire Stone Ltd.14 it was held that the employer was not liable when a collision occurred between the employee and a motor cyclist caused by his negligence. The lorry driver had stopped at a way side caf and crossed one section of a dual carriage way on foot in order to get refreshment which was an act done while he was employed and with his employers permission . The act of getting refreshments was just incidental to his employment

Illustration
ROBBERTS v. SHANKS, (1924) 27 Bom. L. R. 548. (Chauffeurs case). On alighting from his car, the defendant ordered his chauffeur to take the car direct to the garage. The chauffeur, however drove the car to his own residence, took his meals, and whilst driving the car to the garage, negligently drove it into plaintiffs car and caused damage to it. The defendant was held liable in damages for, at the time of the accident, the chauffeur was acting in the course of his employment. A master becomes liable for the wrong done by a servant in the course of his employment in the following six ways1. The wrong may be the natural consequence of something done by a servant with ordinary care in execution of the masters specific orders. 2. The wrong may be due to the servants want of care or negligence in carrying on the work or business in which he is employed. 3. The servants wrong may consist in excess or mistaken execution of a lawful authority. Here it must be shown-

-8-

(a) That the servant intended to do on behalf of his master something which he was, in fact, authorised to do; and (b) That the act, if done in a proper manner, or under the circumstances erroneously supposed by the servant to exist, would have been lawful. 4. The wrong may be a wilful wrong, done on the masters behalf and with the intention of serving his purposes. 5. The wrong may be due to the servants fraudulent act. 6. The wrong may be due to the servants criminal act.

OWNER AND INDEPENDENT CONTRACTER

An independent contractor is one who undertakes o produce a given result without being in any way controlled as to the method by which he attains that result. An independent contractor can use his own discretion as to the manner in which the work for which he is employed is to be executed, whereas a servant in under the supervision and direction of his master as to the way in which he is to execute his work. The general rule is that for the acts and omissions of an independent contractor, his employer is not liable. There are however exceptions to this rule. 1. 2. 3. 4. 5. 6. 7. Where the thing contracted to be done is itself unlawful. Employer retaining control Legal duty Damage to another Implied warranty Incompetent contractor employed The rule in Rylands v. Fletcher Under this rule, the employer is in certain cases involving absolute liability, responsible for the acts of the independent contractor.

3. LIABILITY BY ABETMENT: In actions of torts, those who abet the tortuous acts are as much liable as the tort-feasors themselves.

-9-

Vicarious Liability of State

The government of India may sue or be sued by the name of the Union of India and the government of a State may sue or be sued by the name of the state and may, subject to any provisions which may be made by act of parliament or the state legislature enacted by virtue of powers conferred by this constitution, sue or be sued in relation to their respective affairs in the like cases as the Dominion of India and the corresponding Provinces or the corresponding Indian states might have sued if this constitution had not been enacted. Government Liability in tort: (a) The ruling principle is that Government is not liable for torts of its employees committed in the course of performance of sovereign functions. (b) The theoretical doctrine as per (a) above is still adhered to, but it is being applied in a liberal manner and the courts interpret sovereign narrowly, as is shown by recent law. A suit lies against the government for wrongs done by public servants in the ourse of business, such as death or injury caused to a person by Police atrocities; Saheli v. Commissioner of Police, AIR 1990 SC 513: (1990) 1 SCC 422: 1990 SCC (Cri) 145. In lame words sovereign functions are those functions which can be done by the government agencies only. Distinction between sovereign and non sovereign functions Nagendra Rao Case This distinction between sovereign and non-sovereign functions was considered at some length in N. Nagendra Rao Vs. State of AP (AIR 1994 SC 2663); (1994) 6 SCC 205. All the earlier Indian decisions on the subject were referred to. The court enunciated the following legal principles, in its judgment: In the modern sense, the distinction between sovereign or non-sovereign power thus does not exist. It all depends on the nature of the power and manner of its exercise. Legislative supremacy under the Constitution arises out of constitutional provisions. The legislature is free to legislate on topics and subjects
- 10 -

carved out for it. Similarly, the executive is free to implement and administer the law. A law made by a legislature may be bad or may be ultra vires, but, since it is an exercise of legislative power, a person affected by it may challenge its validity but he cannot approach a court of law for negligence in making the law. Nor can the Government, in exercise of its executive action, be sued for its decision on political or policy matters. It is in (the) public interest that for acts performed by the State, either in its legislative or executive capacity, it should not be answerable in torts. That would be illogical and impracticable. It would be in conflict with even modern notions of sovereignty. The court in the above case suggested the following tests One of the tests to determine if the legislative or executive function is sovereign in nature is, whether the State is answerable for such actions in courts of law. For instance, acts such as defense of the country, raising (the) armed forces and maintaining it, making peace or war, foreign affairs, power to acquire and retain territory, are functions which are indicative of external sovereignty and are political in nature. Therefore, they are not amenable to jurisdiction of ordinary civil court. No suit under Civil Procedure Code would lie in respect of it. The State is immune from being sued, as the jurisdiction of the courts in such matters is impliedly barred. The court proceeded further, as under: But there the immunity ends. No civilized system can permit an executive to play with the people of its county and claim that it is entitled to act in any manner, as it is sovereign. The concept of public interest has changed with structural change in the society. No legal or political system today can place the State above (the law) as it is unjust and unfair for a citizen to be deprived of his property illegally by negligent act of officers of the State without any remedy. From sincerity, efficiency and dignity of (the) State as a juristic person, propounded in nineteenth century as sound sociological basis for State immunity, the circle has gone round and the emphasis now is more on liberty, equality and the rule of law. The modern social thinking of progressive societies and the judicial approach is to do away with archaic State protection and place the State or the Government on a par with any other juristic legal entity. Any watertight compartmentalization of the
- 11 -

functions of the State as sovereign and non-sovereign or governmental and non-governmental is not sound. It is contrary to modern jurisprudential thinking. The need of the State to have extraordinary powers cannot be doubted. But with the conceptual change of statutory power being statutory duty for (the) sake of society and the people, the claim of a common man or ordinary citizen cannot be thrown out, merely because it was done by an officer of the State; duty of its officials and right of the citizens are required to be reconciled, so that the rule of law in a Welfare State is not shaken.

The court emphasized the element of Welfare State in these words: In Welfare State, functions of the State are not only defense of the country or administration of justice or maintaining law and order, but it extends to regulating and controlling the activities of people in almost every sphere, educational, commercial, social, economic, political and even marital. The demarcating line between sovereign and non-sovereign powers, for which no rational basis survives, has largely disappeared. Therefore, barring functions such as administration of justice, maintenance of law and order and repression of crime etc. which are among the primary and inalienable functions of a constitutional Government, the State cannot claim any immunity.

The Court linked together the State and the officers: The determination of vicarious liability of the State being linked with (the) negligence of its officers, if they can be sued personally for which there is no dearth of authority and the law of misfeasance in discharge of public duty having marched ahead, there is no rationale for the proposition that even if the officer is liable, the State cannot be sued. The court also distinguished the judgment in Kasturi Lal, in these words: Ratio of Kasturi Lal is available to those rare and limited cases where the statutory authority acts as a delegate of such functions for which it cannot be sued in court of law. In Kasturi Lal case, the property for damages of which the suit was filed was seized by the police officers while exercising the power of
- 12 -

arrest under section 54(1) (iv) of the Criminal Procedure Code. The power to search and apprehend a suspect under Criminal Procedure Code is one of the inalienable powers of State. It was probably for this reason that the principle of sovereign immunity in the conservative sense was extended by the Court. But the same principle would not be available in large number of other activities carried on by the State by enacting a law in its legislative competence." In this context, the court (in Nagendra Rao) offered the following distinction. A law may be made to carry out the primary or inalienable functions of the State. Criminal Procedure Code is one such law. A search or seizure affected under such law could be taken to be an exercise of power which may be in domain of inalienable function. Whether the authority to which this power is delegated is liable for negligence in discharge of duties while performing such functions, is a different matter. But, when similar powers are conferred under the other statute as incidental or ancillary power to carry out the purpose and objective of the Act, then, it being an exercise of such State function which is not primary or inalienable, an officer acting negligently is liable personally and the State vicariously. Maintenance of law and order or repression of crime may be inalienable functions, for (the) proper exercise of which, the State may enact a law and may delegate its functions, the violation of which may not be sued in torts, unless it trenches into and encroaches on the fundamental rights of life and liberty guaranteed by the Constitution. But that principle would not be attracted where similar powers are conferred on officers who exercise statutory powers which are otherwise than sovereign powers as understood in the modern sense. The Act (Essential Commodities Act) deals with persons indulging in hoarding and black marketing. Any power for regulating and controlling the essential commodities and the delegation of power to authorized officers to inspect, search and seize the property for carrying out the object of the statute cannot be a power, for (the) negligent exercise of which the State can claim immunity. No constitutional system can, either on State necessity or public policy, condone negligent functioning of the State or its officers.

CASE:

Appellants: State Bank of India (Successor to The Imperial Bank of India) Vs. Respondent: Shyama Devi Citation: (1978) 3 SCC 399
- 13 -

In this case the plaintiffs husband gave some amount to his friend Kapil Deo Shukla in the employ of the defendant Bank, who exercised much influence on other employees of the Bank and used to work at different counters. The Bank viewed his actions with approval and acted with negligence. The plaintiff as well as other constituents regarded him as an employee and a responsible person of the Bank and quite often used to hand over the money and letter of instructions to him. But the plaintiff found that his funds were misappropriated. The Supreme Court decided that the clerk acted as a friend and not as an employee; hence he was not an agent so the bank cannot be held liable vicariously.

LATIN MAXIM

Respondeat Superior
"Respondeat superior" (Latin: "let the master answer"; plural: respondeant superiores) is a legal doctrine which states that, in many circumstances, an employer is responsible for the actions of employees performed within the course of their employment. This rule is also called the "Master-Servant Rule", recognized in both common law and civil law jurisdictions. In a broader scope, respondeat superior is based upon the concept of vicarious liability.

In Common Law:

When applied to physical torts an employer/employee relationship must be established and the act must be committed within the scope of employment (i.e.
- 14 -

substantially within time and geographical limits, job description and at least with partial intent to further employer's business. Historically, this doctrine was applied in master/servant or employer/employee relationships. If the employee or servant committed a civil wrong against a third party, the master or employer could be liable for the acts of their servant or employee when those acts were committed within the scope of the relationship. The third party could proceed against both the servant/employee and master/employer. The action against the servant/employee would be based upon the direct responsibility of the servant/employee for his conduct. The action against the master/employer is based upon the theory of vicarious liability, by which one party can be held liable for the acts of another. Employer/employee relationships are the most common area wherein respondeat superior is applied, but often the doctrine is used in the agency relationship. In this, the principal becomes liable for the actions of the agent, even if the principal did not directly commit the act. There are three considerations generally: 1. Was the act committed within the time and space limits of the agency? 2. Was the offense incidental to, or of the same general nature as, the responsibilities the agent is authorized to perform? 3. Was the agent motivated to any degree to benefit the principal by committing the act?

The degree to which these are answered in the affirmative will dictate the degree to which the doctrine can be applied. Common law distinguishes between civil and criminal forms of respondeat superior. In International Law: At issue in the Nuremberg war crimes tribunal following the Allied occupation of Nazi Germany after World War II was a question concerning principles closely related to respondeat superior, which came to be known by the term command responsibility. The Nuremberg trials established that persons cannot use the defense that they were only following the orders of their superiors, if that order violates international norms but especially that superiors that ordered, or "should have known," of such violations yet failed to intervene are also criminally liable.
- 15 -

Qui Facit Per Alium Facit Per Se

Qui facit per alium facit per se, is the authorized act of an agent is as same as the principal's acts. A principal's tort liability is based not on an agency but on the relationship of master and servant expressed in the maxim respondent superior. However, both rules and maxims are founded upon the principle that a duty rests upon every man in managing his/her own affairs, either by himself/herself or by his/her agents or servants. But if another person gets injured upon the acts, the principal is liable for the damage.

Conclusion
We have seen the meaning of vicarious liability and its application under tort law under many circumstances as mentioned above. Vicarious liability is a legal concept which refers to one party being held liable for the injury or damage sustained by another party, in spite of the fact that they had no active involvement in the incident. The intent behind vicarious liability is to hold the proper party accountable when harm is committed. The victim needs compensation and the law provides so by applying the principle of qui facit per alium facit per se that means he who acts through another shall deemed to have acted on his own, the courts hold the employer or principal or partner responsible as per the situation. We have looked at a variety of situations in which a party, including contractors, parents and employers, may be charged with vicarious liability. Vicarious liability is sometimes applied in criminal law too. In India sections 154, 155 etc of the Indian Penal Code are classic examples of the same. However application of
- 16 -

vicarious liability to crimes has been greatly criticized. This is because vicarious criminal liability would violate either or both of two basic principles of the criminal law. According to the first principle, the actus reus requirement, a person cannot be guilty of a crime unless the person's guilty conduct includes a voluntary act or omission. One feature of the actus reus requirement is the protection of personal security it affords by forcing criminal statutes to provide a bright line that a person can choose not to cross and thereby avoid criminal liability. By holding a person liable for the conduct of another, vicarious liability undermines this control principle of the actus reus requirement, because a person cannot control the conduct of others in the same way that she can control her own. Just as importantly, vicarious liability may violate a second principle, that criminal liability must be based on personal fault. Both retributive and utilitarian justifications for criminal penalties demand that fault accompany the moral condemnation and harsher punishments associated with criminal conviction. By punishing the parent for theft if a child steals, for example, vicarious liability could violate this basic rule. Nowadays, vicarious liability in criminal law is rarely applied except in very special circumstance.

- 17 -

BIBLIOGRAPHY

Websites 1. 2. 3. 4. www.wikipedia.org www.scribd.com www.legalserviceindia.com www.manupatra.com

Books 5. 6. 7. 8. Tort Law by Nicholas J McBride & Roderick Bagshaw Law of Tort by P.S.A. Pillai Law of Torts by B.M.Gandhi The Law of torts by Justice G.P.Singh

- 18 -