Tort Law: Vicarious Liability

Question 1

What is vicarious liability?

Answer 1

Where a third party has a legal responsibility for the unlawful action of another.

Question 2

In order for vicarious liability to apply, what two questions must the court ask?

Answer 2

• Was the person who committed the tort an employee?
• Was the tort committed in the course of that employment?

Question 3

What was the salmond test?

Answer 3

Although not suitable now, it was where an employer will only be liable for torts which the employee commits in the course of employment.
The employer will usually be liable for:
- wrongful acts which are actually authorised by the employer.
- acts which are wrongful ways of doing something authorised by the employer, even if the acts themselves mere expressly forbidden by the employer.

Question 4

What are the reasons for vicarious liability reiterated by Lords Phillips (fine incidents)?

Answer 4

• The employer is more likely to have the means to compensate the victim than the employers and can be expected to have insured against that liability.
• The tort will have been committed as a result of activity being performed by the employee on behalf of the employer.
• The employee’s activity is likely to be part of the business activity of the employer.
• The employer, by employing the employee to carry on the activity, will have created the risk of the tort committed by the employee.
• The employee will, to a greater or lesser degree, have been under the control of the employer.

Question 5

What is the control test?

Answer 5

Tests whether the employer had the right to control what the employee did and the way in which it was done.
Short V JW Henderson LTD (1946) identified the features which would show that the employer had control over the employee:
- the power to select the servant
- the right to control the method of working
- the right to suspend and dismiss
- the payment of wages
But if the work is particularly skilled or sophisticated then the test becomes less effective because the employer may have limited understanding in the work process.

Question 6

What is the integration or organisation test?

Answer 6

• Established in Stevenson Jordan and Warrison LTD V MacDonald and Evans 1952
• Stated that a person will be an employee if their work is fully integrated into the business as opposed to being an accessory to the business

Question 7

What is the economic reality or multiple test?

Answer 7

• Courts recognised that a single test of employment status is not satisfactory and may produce confusing results.
• The econ test considers various factors to determine whether a person is employed or self-employed.
• 3 conditions established in Ready mixed concrete V Minister of pensions + National Insurance 1968 =
• the employee provides work/skill in return of wage
• the employee accepts that the work is subject to the control of the employer
• other terms in the contract are consistent with it being a contract of service not for service

Question 8

What are the additional factors that may be considered for the economic reality/multiple test?

Answer 8

• Ownership of equipment.
• Method of payment - self employed likely take payment for completing one whole job whereas an employee will relieve regular payments.
• If tax, National Insurance and pension contributions are deducted from employee’s wages, self employed will submit self assessments and pay tax annually.
• Whether work is sourced by the person or given to them by someone else.

Question 9

In order for the employer to be liable, the employee has to commit the tort in the course of the employment.

How do the courts decide this?

Answer 9

Whether the employee was doing their job but acts against orders in the way they do it - employer can be liable for any tort committed as shown in Limpus V London General 1862.

Whether the employee committed a crime during the work - employer can be liable to the victim of the crime if there is a close connection between the crime and the employees job as shown in Lister V Helsey Hall 2001

whether the employee did their job badly - the employer can be liable for their actions which cause injusy to another as shown in century insurance V Northern Irelan road transport board 1942.

Whether the employee was acting on a frolic outside the time and place og employment the employer is not liable.