A more recent version of these Vicarious Liability notes – written by Cambridge/Bpp/College Of Law students – is available here.
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Tort Law : Vicarious Liability
?????Vicarious liability = where one party is held liable for the torts of another. Arises because of a specific relationship between the parties. 'Vicarious' means 'on behalf of another'.
?????Vicarious is not a tort itself---but a determination of who is potentially liable---it's a way of suing someone else other than the tortfaesor
?????Vicarious liability is strict liability, no need to show fault on part of defendant---employer will be strictly liable, even in absence of fault.
?????Vic Lib is a form of secondary liability: Different terminology: o Primary liability: When D is held liable for his own wrong-doing---eg, - employer themselves is at fault - direct liability = employers' liability o Secondary liability = vicarious liability, when suing someone else other than the tortfaesor
?????An employer can be sued both directly and vicariously for the same event.
?????Vicarious liability can arise in other situations than employer/employee relationships, eg principal/agent, but not on this cause.
?????In vicarious situations, there are often joint tortfeasors, such as employer & employee, who are jointly liable. In reality, the party sued is often the one in the best position financially to meet any judgement. Background and justification
? Origins in C18
? Justification: o 1. 'Deep pockets' argument: Employer in better financial position to pay compensation-- has deep pockets (will be insured, will be able to pay). Under Employers' Liability (Compulsory Insurance) Act 1969, all employers have ot obtain compulsory insurance for their employees. o 2. Employer exercises both control and supervision over its employees. o 3. An employer may be careless in selecting negligent employees and should suffer the consequences thereof; o 4. Benefit/burden theory: Benefits and burdens of employees. Employer should have the burden if they have the benefit. The employer gets benefit from employee's actions, so should bear burden if goes wrong o 5. High standards---employers will make efforts to see that employees don't commit torts, will encourage high standard of care. o 6. Vic Lib encourages better training, supervision and control of employees. 1
o 7. Loss distribution. Structure for a vicarious liability claim
1. A tort has been committed by another (X)? Have to identify the tort.
2. X is an employee of the Defendant (D) being sued.
3. The tort was committed in the course of employment.
(1) A Tort has to be committed by another (X)
?????If no tort, then no vic liability.
?????Vast majority of cases, the tort is negligence.
?????Torts (on syllabus) that can be committed vicariously o Trespass torts:
? False imprisonment o Negligence o Defamation:
?????You identify the relevant tort; and go through the structure of this tort.
(2) X is an employee of the defendant---the employment relationship
?????Employer/employee relationship = where there is a contract of service. CF employer/independent contractor relationship, where there is a contract for services---in the latter, vicarious liability will not generally arise.
?????Two parts: o (1) Is the tortfeasor an employee?
o (2) is the defendant their employer?
?????General guidance---several tests from the courts/tribunals: o Each case decided on a fact by fact basis. o Few of the authorities involve torts---the case law often comes from employment tribunal cases. o Consider the year that authorities were decided---
because has changed over time. And recent 2016 cases suggest another approach again. Give more recent cases priority. Who is an employee?---THREE MAIN TESTS: (1) control test; (2) integration test; (3) economic reality/multiple factors test.
?????(1) Control test: o Original test. 2
o Looked to see how much control D had over the worker. o Yewens v Noakes (1880): terminology of 'master and servant'---the more control the master has over servant, more likely to be an employee. 'Servant is subject to command of their master' o Shift away from control (though it is still a consideration): o Cassidy v Ministry of Health (1951), limited control but still an employee: a hospital was found vicariously liable, even though there was only limited control over the Dr who performed the negligent operation. o Argent v Ministry for Social Security (1968). Art teacher, was allowed to teach what he wished with no prescribed syllabus, subject to only occasional visits by the Director of Drama Studies to his classes. He was found to be selfemployed, said he's an independent contractor, not an employee. Court said: control is not the deciding factor anymore. o So, control is non-conclusive, but still an important factor to be considered
?????(2) Integration/Organisation Test o First proposed by Denning LJ in Stevenson, Jordan and Harrison v MacDonald and Evans (1952): question: whether or not the worker is fully integrated within the organisation, or merely auxiliary to it. o Like with control test, problems have arisen as the working population has changed in structure and complexity. o Whittaker v Minister of Pensions (1967): instead of control, looked at integration. Looked at working life of claimant, a trapeze artist who worked for a circus. If you look at her working day, the work she did was integral to the working of the circus, she was fully integrated. They said control is a factor to consider, but not the most important.
?????Mutuality of obligations [part of economic reality test below]
o O'Kelly v Trusthouse Forte (1984): employee or independent contractor? Re a casual waiter---found not to be employee, as had no obligation to work, nor did his employers have any obligation to provide him with work. They looked at obligations---employer was not obliged to offer work; and employee wasn't under obligation to accept work. So said there's a low mutuality of obligations---not employee. o Eg Zero-Hours Contracts.
?????Labelling (how parties describe their relationship) [part of economic reality test below]
o Massey v Crown Life (1978) and Ferguson v John Dawson (1976): HELD: you can't just look at the labelling, labelling is not conclusive, just a factor. It might be in interests of employer to make it look like you are
3 self-employed. Court said we'll look at the label, but if that's inconsistent with the other factors, we'll ignore it. o See also, Young and Woods v West (1980)
?????So lots of flexibility by courts. Variety of tests. Courts want to decide on case-by-case basis.
????? (3) 'Multiple Factors' /'Economic reality' test (more modern, practical approach) o Ready Mixed Concrete v Minister of Pensions (1968):
? Court considering status of X who drove a concrete mixer. X was responsible for hiring, insuring and running the lorry and was paid by the company on the basis of his mileage.
? The company exercised control over uniform and colours of the lorry, but despite this, held: the driver was an independent contractor. The driver was in business on his own account ? therefore an independent contractor.
? McKenna J, three-pronged formulation: (1) look at control; (2) look at remuneration- how are they paid? (3) other provisions of contract, everything else about their contract, are these consistent with a contract of service.
? Economic realities (eg profits, losses etc) of the situation are paramount: 'He who owns the assets and bears the risk is unlikely to be a servant'. o Approach further developed in Warner Holidays v SoS Social Services (1983): McNeil j, attempted to set out a list of points a court should consider--basically summarised everything that had previously been considered (control, integration, obligations, pay, national insurance)---list everything about their working condition, and decide overall whether they look like an employee.
? Level of control (see above)
? Provision of tools and equipment (see Ready Mixed Concrete, above).
? Tax/PAYE/national insurance
? Sick pay
? Bearing the risk of profit and loss
? Residual control
? Control over hours of work
? Right/ability to do other work (Argent v Minister of Social Security, see above).
? Labelling (see above, Massey v Crown Life Insurance and Ferguson v John Dawson).
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