Vicarious Liability: Independent Contractors And Apparent Agents - Mar. 1

Question 1

What is an independent contractor? (Feldman)

Answer 1

An “independent contractor” is an agent whose “physical conduct” the principal does not have the right to control. “If the employer’s right to control the activities of an employee extends to the manner in which a task is to be performed, then the employee is not an independent contractor.” (p.785)

Question 2

What is the difference between an independent contractor and an employee? (Feldman)

Answer 2

“the employee surrenders to the employer the right to direct the details of [the] work, in exchange for receiving a wage” (p.785), whereas the independent contractor is committed to providing a specified output and the principal monitors the contractor’s performance by inspecting that output. (p.785)

Question 3

What is the general rule of non-liability for torts of independent contractors? (Feldman)

Answer 3

While employers are liable for the torts of their employees committed within the scope of their
employment, principals are not liable for the torts that “independent contractors” commit while working on their behalf.

Question 4

What are the three justifications as to why principals are not liable for the torts of independent contractors? (Feldman)

Answer 4

(1) to place liability on the party best able to
bear and distribute the loss (p.788);
(2) to assign liability to the party best able to control the underlying risk (p.789); and
(3) to assign liability so that the costs of accidents are borne by those who benefit from the activities that precipitate them (pp.789-90).

Question 5

What are the three categories of exceptions to the general rule of non-liability for torts of independent contractors? (Feldman)

Answer 5

(1) “negligence in the selection of an independent contractor” (also called “employment of an incompetent contractor”);
(2) non-delegable duties; and
(3) work that is “abnormally,” “peculiarly,” or “inherently” dangerous.

Question 6

Is a principal who hires an underinsured independent contractor liable for torts attributable to the independent contractor under the “incompetent contractor” exception? (Feldman)

Answer 6

No. (Robinson, General Rule)

Question 7

What are peculiar risks? (Feldman)

Answer 7

“Peculiar risks” are risks that are likely to create a heightened risk of physical harm to third parties unless special precautions are taken. These risks are known to principals but are not comparably evident to independent contractors.

Question 8

What are abnormally dangerous risks? (Feldman)

Answer 8

An “abnormally dangerous” risk is a risk that is especially great no matter where the activity is conducted or how carefully it is conducted. Posner
states that the reason for holding the principal strictly liable is to induce the principal to “consider the possibility of preventing some accidents by curtailing the activity or even eliminating it altogether.” (pp.793-94)

Question 9

What are inherent dangers? (Feldman)

Answer 9

“Inherent Dangers” are dangers that exist because of the particular circumstances under which an activity must be conducted (e.g., doing structural steel repair work in an occupied building). The unusual
circumstances under which the activity must be conducted are a feature of the principal’s activity.

Question 10

What questions do the exceptions answer? (Feldman)

Answer 10

“Who is in the best position to take precautions against this kind of risk?”

Question 11

How do ostensible or apparent agency impose vicarious liability? (Feldman)

Answer 11

Ostensible or apparent agency imposes vicarious liability based on the reasonable perceptions of potential victims. It is often employed in the hospital setting, where health care providers may be employed by separate companies.

Question 12

What is apparent authority? (Feldman)

Answer 12

Apparent authority is the power held by an agent or other actor to affect a principal’s legal relations with third parties when a third party reasonably
believes the actor has authority to act on behalf of the principal and that belief is traceable to the principal’s manifestations.

Question 13

What are the steps when doing a vicarious liability question? (Feldman)

Answer 13

Step One: the underlying tort
Step Two: vicarious liability

Question 14

What questions are asked during the second step of the vicarious liability question? (Feldman)

Answer 14

1. Is the agent an employee (scope of control test), apparent agent (holding out test), or independent contractor?
2. If the agent is an employee, was the tortious conduct within the scope of employment?
3. If the agent is an apparent agent, was the tortious conduct within the scope of
   apparent authority?
4. If the agent is an independent contractor, is an exception to the rule of nonliability applicable?