A CASE BRIEF OF VICARIOUS LIABILITY

INTRODUCTION:

Man is social being.Since ancient times,people have been living in a social way for their own needs.In order to live the society,people have to follow the existing rules of society.If anyone disobey the rules,he is punished.Sometimes,the person who never doing any wrong,punished for the wrong done by others.It is called vicarious liability.According to vicarious liability principle,an individual can be held liable who did not actually cause the harm but who has a specific superior legal relationship to the person who did cause the harm. 

FACT:

Brian works for Tasty Treat Company as a delivery driver.He drives his own van but wears a uniform supplied by Tasty Treat Company,who pays his monthly salary.On Monday afternoon,he is on his way to do his last delivery when he gets a call from his daughter Kate and agrees to pick her up from school.While Brian was driving in the direction of kate’s school.Brian’s van hits Oliver’s car.Oliver is injured and his car is damaged.Now Oliver is seeking legal advice.

 

Before giving advice to Oliver,we are trying to find out some issues from the fact by which we can easily make an advice  for Oliver.

ISSUES:

The probable issues which may arise from the given fact/situation are given below:

1. Can Brian be held liable for causing harm to Oliver?

2. What is the relation between Brian & Tasty Treat Company?

3. Whether Brian is an employee of the Tasty Treat Company or not?

4. If so, then whether Tasty Treat Company can be held liable for the harm caused by Brian?

5. Whether Oliver can claim compensation from Tasty Treat Company for his injury?

6. Is there any defence which Tasty Treat Company can take to avoid its liability?

7. Whether Tasty Treat Company can recover from Brian for his misdeed?

 

Rule:

The above-mentioned issues are covered by the following rule of law & principles:

1. If a  person fails to exercise standard of care which the doer as a reasonable man should have exercised in the circumstances,can be held liable for any harm caused under negligence tort.

2. According to vicarious liability principle,an individual can be held liable who did not actually cause the harm but who has a specific superior legal relationship to the person who did cause the harm.

3. Under employers’ indemnity,the employers can recover from their employee for their misdeed if the employee has acted in breach of contract.

Analysis:

From the above fact we are already getting some issue.By answering /solving those issue,we are able to solve the fact and also able to find out who is actually liable for this incident.we also able to give legal advice to Oliver.

 

The first issue was “Can Brian be held liable for causing harm to Oliver?”

Ans: It is one of the most important issue that who is liable?By answering this question we may know, Is Brian liable or  not?According to the eye of law,Brian is not liable for causing harm to Oliver.Because it is a vicarious liability.According to vicarious liability principle,an individual can be held liable who did not actually cause  the harm but who has a specific superior legal relationship to the person who did cause the harm.Thats why liability is vested upon Tasty Treat Company.Because there is a superior legal relationship between Tasty Treat Company & Brian.

 

The second issue was  “What is the relation between Brian &Tasty Treat Company?

Ans:The relation between Tasty Treat Company and Brian is Master-Servant relationship.Here Brian is an employee of the Tasty Treat Company according to the contract what is made between them.

The third issue was “Whether Brian is an employee of the Tasty Treat company or not?”

Ans:Whether someone is an employee or an independent contractor can be established by applying various tests which were devised in the leading case of “Ready Mixed Concrete Vs. Minister of Pensions and National Insurance(1968) & include:

a)Control Test:Which asks if the employee is under the control of the employer who tells him what to do and how to do it?If the person is under the control of the company,he is an employee of the company.

b)Integration Test:This test ask is the person integrated into the company?If the person is integrated to the company then he is an employee of the company.

c)Economic Reality Test:This test is basically to determine factors such as who pays the workers Tax and national insurance.And also who provides the tools for work?

From the above two rules (Control Test,Integration Test) ,it is clear that Brian is an employee of the Tasty Treat Company.But according to Economic Reality Test,it seemed that Brian is not an employee of the Tasty Treat Company rather an Indepedent Contractor.

 

# Various test to prove employer-employee relationship(Modern view;Multiple Test):

 

·         Control Test:

 

·         Masters power of selection of his servant.

·         Payment of wages or other remuneration.

·         Masters right to control the method of doing the work.

·         Masters right of suspension or dismissal.

According to the control test,it is prove that Brian is an employee of the Tasty Treat Company.

 

·         The Nature of Employment Test:

One accepted view is that people who have a contract of service (an employment contract) are employees.But people who have a contract for service (a service contract) are independent contractors.

In Ready Mixed Concrete Ltd Vs. minister of Pensions Case,

Firstly,the Court held that whether a contract creates a ‘master-servant’ relationship  between an employer and employee is determined on the basis of contractual rights and duties,and that the nomenclature used in the conract is irrelevant.Thus,the fact that the contract termed the driver to be an “independent contracto”r is not material.

 

Secondly,the Court held that employment  under a contract of service exists when:

1. Servant agrees that in consideration of wages or other remuneration he will provide his work and skill in the performance of some service for his master.

2. He agrees expressly  or impliedly  that in the performance of that service he will be subject to others control in a sufficient  degrees to make that other master.

3. The other provisions of the contract are consistent with its being a contract of service.

 

On the facts, the Court held that the driver had sufficient freedom in the performance of his contractual obligations as he was free to decide the vehicle, his own labour, fuel,and other requirements in the performance of the task. In lieu of these freedoms, he was an independent contractor and not an employee of the company.

 

·         The Integral Part of Business Test:

Under a contract of service,a man is employeed as a part of the business and his work is done as an integral part of the business.Where as,under a contract for service,his work also done for the business is not integrated into it but It is only accessory to it.

·         Risk of Loss Test:

In Montreal Vs.Montreal Lecomotive Works Ltd Case ,Lord Wright said,in the more complex condition of modern industry,more complited test have often been applied.According to him,it would be more appropriate to apply a complex test involving___

·         Control

·         Ownership of the tools

·         Chance of profit

·         Risk of loss

In a latter case Market Investigation Ltd Vs.Miniter of Social Security,Cooke J referred  to these factors and said that the fundamental test was:

 

Is the person who has engaged himself to perform these services performing them as a person in business on his own account?If the answer is yes,it is a contract for service.If answer is no,then it turned into contract of service.

 

·         Significant Outcome:

There must be significant outcome.

 

From the above discussion,we already know that “who is an employee?” it is a debateable question.It is the duty of the Court to decide this matter.If we relate the above discussion with the given fact,some points mentioned that Brian is working for the Tasty Treat Company as an employee and also some points mentioned that Brian is not an employee of the Tasty Treat Company rather he is an “independent contractor” of the Company.

 

 

The fourth question was “If so,then whether Tasty Treat Company can be held liable for the harm caused by Brian?”

 

Ans:Yes,Tasty Treat Company can be held liable for the harm caused by Brian.Primarily,we are identifying that Brian is an employee of the Tasty Treat Company.There is a relation between Tasty Treat Company and Brian,and the relation is master-servant relation.As a general rule,a person is liable for his own act,but there are certain circumstances in which a person is liable for the wrong committed by others.This is called Vicarious Liability.

 

#Meaning of Vicarious Liability:

Legal concept which assigns liability to an individual who did not cause the harm but has a superior legal relationship to the person who cause the harm or damage.

For example:

·         Master-servant relationship

·         Principal-agent relationship

·         Partners relationship

 

The fifth question is that “Whether Oliver can claim compensation from Tasty Treat Company for his injury?

 

Ans:Yes,Oliver can compensate from the Tasty Treat Company.According to vicarious liability principle,an individual can be held liable who did not actually cause the harm but has a superior legal relationship to the person who did the harm.

 

The sixth question is that “Is there any defense which Tasty Treat Company can take to avoid its liability?”

 

Ans:

Yes,There is defense which Tasty Treat Company can take to avoid its liability.

·         According to vicarious liability principle,an individual can be held liable who did not actually cause the harm but has a superior legal relationship to the person who did the harm.That is why Tasty Treat Company has to be compensate to Oliver.If the Company is able to prove that Brian has acted in breach of contract.Then there is no liability vested upon Tasty Treat Company and Brian has to be compensate to Oliver.

·         According to Ready Mixed Concrete Ltd Vs. Minister of Pensions Case,

Firstly,the Court held that whether a contract creates a ‘master-servant’ relationship  between an employer and employee is determined on the basis of contractual rights and duties,and that the nomenclature used in the conract is irrelevant.Thus,the fact that the contract termed the driver to be an “independent contractor” is not material.

 

Secondly,the Court held that employment  under a contract of service exists when:

·         Servant agrees that in consideration of wages or other remuneration he will provide his work and skill in the performance of some service for his master.

·         He agrees expressly  or impliedly  that in the performance of that service he will be subject to others control in a sufficient  degrees to make that other master.

·         The other provisions of the contract are consistent with its being a contract of service.

 

On the facts,the Court held that the driver had sufficient freedom in the performance of his contractual obligations as he was free to decide the vehicle,his own labour,fuel,and other requirements in the performance of the task.In lieu of these freedoms,he was an independent contractor and not an employee of the company.Whether Brian is not an employee of the tasty treat Company rather an independent contractor that is why there is no liability vested upon the Company.

 

The seventh question is that “Whether Tasty Treat Company can recover from Brian for his misdeed?”

Ans:Yes,Tasty Treat Company can recover from Brian for his misdeed.

 

·         Under employers indemnity,the employers can recover from their employee for their misdeed  if the employee has acted in breach of contract.

If the Court prove that Brian has acted in breach of contract,Tasty Treat Company can recover from Brian.

 

Conclusion:

From the above application,we are clear that the duty to declare “who is liable” is totally the decision of the Court.In this fact:

1.      If the Court presume that Brian is an employee of the Tasty Treat Company,then Tasty Treat Company is liable for the act done by Brian and the Company has to be compensate to Oliver.

2.      If the court presume that Brian is an independent contractor and he works for the company as “contract for service”,then the liability is vested upon him.

3.      If the court presume that Brian is an employee of the Tasty Treat Company but he has acted in breach of duty,then according to employers indemnity “Tasty Treat Company can recover from Brian for the act done by Brian”.

4.      Sometimes,employers are responsible for acts of independent contractors in case of “non delegable duties” and also if the employers are negligent in choosing independent contractors.

If we said that,Brian is an independent contractor according to the contract made between Brian and Tasty Treat Company and also according to the case reference “Ready Mixed Concrete ltd Vs. Minister of Pensions”,then according to the law,Brian should be liable but Brian is not liable because Tasty Treat Company is negligent in choosing independent contractor.Thats why,Oliver can claim compensate from the Tasty Treat Company.If Brian has acted in  brich of contract,then Tasty Treat Company can recover from Brian for his misdeed under employers indemnity.