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Vicarious Liability: A Critical Study Highlighting Cases In India

This paper deals with Vicarious Liability which means master and servant relationship. It is a situation where one person is liable for the act of others. So, in the case of Vicarious Liability both the person at whose the command is given and the other person acting on it, are liable. Mainly, the employees are liable for the act they are committing throughout their course of employment. It is a principle of strict liability dominated by fault-based liability. It is unjust because here, an innocent party is compensating for the loss of others.

Still, in many western legal systems, it is found to be on the common law. The application of Vicarious Liability is discussed to define the preconditions according to which, responsible persons are determined for indemnification. Different case laws regarding this Doctrine will be taken into consideration.

Introduction
Vicarious liability deals with master and servant relationships. It means that it is based on two Latin maxims. Firstly, the principle of qui facit per se alium facit per se, which means, He who does an act through another is deemed in law to do it himself and the other one is Respondent Superior which means, a principle must answer for the facts of his subordinate.

Generally, a person is liable for his own wrongful acts and one does not incur any liability for the acts done by others. In certain cases, however, vicarious liability, that is the liability of one person for the act of another person, may arise. In order that the liability of A for the act done by B can arise, it is necessary that there should be certain kind of relationship between A and B, and the wrongful act should be, in certain way, connected with that relationship. Thus, employers are vicariously liable for the tort which their employees commit during the course of employment.

There are various examples of liability. i.e

  1. Liability of principal and agent.
  2. Liability of master and servant.
  3. Liability of partners in each other tort.

There are also some essentials to this liability:

  1. There should be a certain relation between the two parties, and
  2.  The wrongful act should be in such a way that it is connected to the relationship.
So basically, it will talk about the relationship between Servant and Independent Contractor.

Even in the field of medico-legal, some legal decisions were taken regarding the authority of both hospitals and doctors. Some of the middlemen think that holding the hospital authority to be vicariously liable for the doctors will diminish the sense of professional action. Here, the view was expressed that if the hospital authority is not responsible for the wrongdoings or the errors made by their junior staff members then the morale of these people will suffer and the people for this post will be hard to find. If this happens then it is harmful to both the community and the profession.[1] . So, it is important to find out whether it violates this law or not. And if this happens then Parliament should amend some changes to this.

Position In India
Like the Crown Proceedings Act, 1947, we in India don't have any provisions regarding this liability. Therefore, it is necessary to trace this, as contained in article 300 of the constitution.

Research Problem
The research problem which could be seen here is that in vicarious liability the master is responsible for the act of his servant but here in some cases it can be seen that because of the independent contractor the master isn't held liable. Other than this the liability of the state doesn't have any statutory provisions mentioning liability of State in India The present position of India is not certain.

Literature Review
BMJ, Vicarious Liability, The British Medical Journal, Jun. 13, 1953, Vol. 1, No. 4823 (Jun. 13, 1953), pp. 1338-1339[2]

This article discusses about the vicarious liability from the medico- legal perspective. How the relation between the doctors and the hospital is hard to find. Here, the view was expressed that if the hospital authority is not responsible for the wrong doings or the errors made by their junior staff members then the morale of these people will suffer and the people for this post will be hard to find. If this happens then it is harmful for both the community and the profession.

It basically discusses about the relation between agent and servant. Several examples are taken to connect the dots between this tort and medico-legal profession. This is one of the old principles. Under the Law Reform (Married Women and Tort-feasors) Act, 1935, where two people are responsible for the damage caused by the same failure to take reasonable care the court has power to order the one which it thinks to be really as well as legally responsible to indemnify the other, or to contribute to what the other has to pay to the plaintiff. The judgement was given but still in the ultimate analysis the relation between doctor and the patient is not the matter not of law but of the conscience.

Edward A. Mearns, Jr., Vicarious Liability for Agency Contracts, Virginia Law Review , Jan., 1962, Vol. 48, No. 1 (Jan., 1962), pp. 50-57.[3]
This paper talks about vicarious liability in agency contract. This law is not the same as that in applied cases involving torts committing by the agents. In agency, an employer is not bound on every promise made by his employee on his behalf, but only those the employer has authorized.

The various steps are found to make contracts follow the path of torts. Firstly, we need to see that whether the principal liability is vicarious or not and then secondly, whether the promises made are under the course of employment or not. The rationale underlying this traditional approach reflects some 19th Century notions about liability. Professor Warren Seavey in his fine article, Agency Powers, 2 which appeared back in 1948, provides more support than is probably necessary.

Three cases were explained and cited regarding this principal and they were considered as loser as none of them were able to reconcile the old theory with the actual result. Whichever test is found or used in finding; its basis should be real.

Jacob, A. (1965). Vicarious Liability of Government in Torts. Journal of the Indian Law Institute, 7(3), 247-251.[4]

This paper discusses about the cases which gives explanation regarding the vicarious liability of the government for the tortious act of its servants. Different factors were taken into consideration while seeing this situation. Reference of article 300 of the Constitution were also taken. The sovereign and non-sovereign functions of the state determine whether state is liable or not. If a tortious act is committed by a public servant in discharge of sovereign functions, no action will lie.

But if such act is done in the course of non-sovereign functions, an action will lie. In some cases sovereign authority were seen in some non- sovereign. All the discussion in this points out to the fact that the decision should be taken by the judiciary. The case of Kasturi Lal gives the outmost distinction between sovereign and non-sovereign. Furthermore, suggests legislative action to solve the problem of liability in torts.

Narasimham, R. L. (1969). Vicarious Liability Of A Master For The Criminal Act Of His Servant—View Of Hindu Jurists. Journal of the Indian Law Institute, 11(3), 321-327.[5]

This paper discusses about the true intention of the legislature. For this all the statues need to be clearly understood. Some sections are also mentioned here. Some words given here emphasises tat the act must be in course of employment. Once it is proved that the servant's criminal act is for the benefit of the master than the master can be liable.

The Indian penal cod should amend some of the laws so a to incorporate the principle of Hindu jurists. IT is somehow difficult to prove that servant's criminal act was done in the course of employment and that it enured for the benefit of his master. It also says that I such an amendment is made, then it could be termed as constructive instigation.

Bell, J. (2013). The Basis Of Vicarious Liability. The Cambridge Law Journal, 72(1), 17-20. Retrieved July 3, 2021, from http://www.jstor.org/stable/41819968[6]
In this paper different cases have been cited so as to understand the basis of Vicarious liability. Here five policy reasons can be seen to impose the Vicarious Liability. The employee has to compensate the victim than the employee. Secondly, the tort was committed as a result of activity undertaken by the employee.

And the employee activity has to be a part of the business activity of the employer. Also they both have to take the risk of tort. And last is that the employer has to be in control of the employee. The terminology which is to be used like business, workman and employer is distracting. This type of liability is imposed where a defendant, whose relationship with the abuser put it in a position to use the abuser to carry on its business or further its own interests, has done so in a manner which has created or significantly enhanced the risk that the victim or victims would suffer the relevant abuse. But this risk doesn't identify as it is not likely to be causing the harm

Research Objectives
  1. To study about the effects of Vicarious Liability under Indian laws of contract.
  2. To understand the considerations giving rise to Vicarious Liability.
  3. To see the exceptions related to this liability.

Research Questions
  1. What is the position of Vicarious Liability of a state?
  2. What are the principle governing Vicarious Liability with the help of recent judgements.
Methodology
This research paper talks about the tort of Vicarious Liability which means master and servant relationship where the master is liable for all the wrongful acts committed by his servant during the course of employment.

It is a very informative paper. Here the data is collected through secondary sources like books, articles and journals and also referred case laws for reference and easy understanding of this above-mentioned principle.

To study about the effects of Vicarious Liability under Indian laws of Contract

When two or more parties enter into a contract, they both are liable for the breach. Vicarious liability can be defined as a liability where one person is held responsible for another person's act. In the field of Tort, it is considered to be an exception to the general rue that the person will be liable for his/her own acts only. So, for this type of liability for the act of someone else to get arise, it is important to understand that there is some kind of relationship between the two parties and there should be a wrongful act committed.

He examples which can b seen in this type are:
  1. Liability of master for the tort of servant.
  2. Liability of partner for each other's tort.
  3. Liability of the principal for the tort of his servant.

Reasons for Vicarious Liability

There are several reasons for the people to commit this type of act which result in vicarious liability:
If we talk about the Indian Contract Act, there are no provisions mentioned regarding Vicarious Liability but there are some terms which are mentioned such and principal and agent. There are some sections related to these provisions. The sections are from 182 to 238 of the Indian contract Act. Section 183 states that no person can become an agent unless and until he/she attains the age of majority and is of sound mind.

In the words of Lord Chelmsford:
it has been established by law that a master is liable to third persons for any injury or damage done through the negligence or unskillfulness of a servant acting in his master's employ. The reason is that every act done by the servant in the course of his duty is regarded as done by his master's order, and, consequently it is the same as if it were master's act.[7]

For example- Ram has a car driver named Suraj. If he negligently knocks down X, then Ram will be liable. But if he hires a taxi towards the hotel and the taxi driver negligently hits X then Ram will not be liable towards X because the taxi driver is not the servant of RAJ but he is an independent contractor.

In the Contract Act, it is said that the power lies in the hand of the principal to prove whether he act committed by is agent comes under the frame of the principal-agent relationship or not. If he fails to prove it then he will be liable for the acts or wrongdoings committed by his agent under the concept of vicarious liability. This concept can be understood by some of the case laws.

In the case of State of Rajasthan v. Smt Shekhu and ors[8] the deceased and his brother were going on a bicycle and a jeep which was owned by Distt. collector came from the opposite side and hit them which resulted in the death of the deceased. In this case, the court clearly stated that definition of 'vicarious liability' means that one person takes or supplies the place of another so far as the liability is concerned. It means the liability of a person for the tort of another in which he had no part. The court also stated that an owner of a car would be liable for an accident caused by his servant during the time of his employment.

To understand the considerations giving rise to Vicarious Liability

In Vicarious Liability, it is said that one party is liable for the act of other party that means that a person can be held liable for the wrongdoing of the other person because of the certain type of relationship that exist between them. When one person authorises someone on his behalf then this type of liability arises.[9] Even if the person has nothing to do with the wrongful actions, he can still be liable for that.

This arises when there is certain type of special relationship between the two persons that can be called as master-servant relationship.
This type of liability does not rise suddenly. It just gets created when there is a special relationship between two persons and that time one party has done something wrong so the other ill be held liable. Like if A is an employee of B, then B will be liable for the wrongful acts of A.

There are certain relations which explains such situations and where Vicarious Liability arises:

  1. Principal- Agent
  2. Master- Servant
  3. Owners- Independent Contractors
  4. Company- Directors

Also, there are two modes through which we can understand how it arises:
  1. Vicarious Liability By Authorisation:

    This type of vicarious liability arises because of an act where one act is done by another person by giving authority on behalf of the other person. Even when a person, for a single transaction, authorizes another to do something for him and the latter does it negligently, the former can be made liable for the same.

    This can be explained by referring to a case of Ormod v.Crosville Motor Services Ltd.,[10] which relates to the liability of the principal for the tort of his agent. In this case, the owner of the car requesting his friend to drive the car from Birkenhead to Monte Carlo so that on reaching there, they could use the car for joint holiday. Shortly after leaving Birkenhead, the friend driving the car, caused an accident. It was held that the owner of the car was liable for such negligence of his friend.
     
  2. Vicarious Liability By Ratification:

    Here, the servant commits the tort without authorisation. The principal is bound by the act of the servant and is liable for that. There ae several conditions which needs to be fulfilled:
    1. The wrongful act must be done on behalf of the principal and,
    2. The principal should have the whole knowledge of the act which is committed because here, a void act can't be ratified.

To see the exceptions related to this liability

The general rule is that an employer is not liable for the acts of an independent contractor's negligence under vicarious liability. But there are some exceptional cases where the employer can be held liable.
  1. Like if an employer authorizes him for doing any wrongful act and ratifies as the same then he can be liable for the wrongdoings of the independent contractor. The reason is that he is himself the party to wrongful act, along with independent contractor and there fore he is liable as tortfeasor. Looking at the case of Maganbhai v. Ishwarbhai[11] the chief trustee of the properties of a temple called an electric contractor to illegally divert the supply of electricity from agricultural purposes to the temple for one month for lightning in the temple and adjusting the mics. It was adjusting in a very hazardous mode without informing the Electricity board. After 14 days, the electricity got snapped and one of the workers working there got injured by current. In this case, it was seen that the trustee who said to do this work and the owner of the land by whose knowledge it was done, both were liable.
     
  2. Secondly, even though generally the servant is in the control of the master, but there are various cases in which the master can't control the way in which work is done. Like for example- the surgeons in the hospitals. Even though they are servants but they don't do the work as directed. Basically, the state is not responsible for the tort committed by the doctors. The surgeons are not given any order as to how to perform the operation. This situation can be seen with a case of Rajasthan State Road Transport Corpn. v. K.N. Kothari[12] the supreme court held that the transfer of effective control over a servant, would make the transferee of the vehicle liable for vicarious liability.
In this case, the RSRTC had hired a bus and a driver for running it on a specific route. They also arranged a conductor who collected fares from the passengers and also had exercised control over the driver. It was held that the accident caused by the driver, the hirer(RSRTC) was vicariously liable.

The case of hospital can also be seen in Hillyer v. St. Bartholomew's Hospital[13] the hospital authorities were not held vicariously liable for the negligence of the professional's staffs involving professional care and skill because they lack the power of control between them.

Thirdly, it is not necessary that there should be long term master servant relationship. Even when a person for a single work authorizes someone to do it and latter does it negligently, the former can be made liable for the same. And also, he is not only liable for the acts he is authorized to but also it should be done by the servant during the course of employment.

What is the position of Vicarious Liability of a state?

Vicarious Liability talks about master and servant relationship that master is liable for all the act of the servant. State means an established government. We can see that the state is vicariously liable for the people, the joint owners etc. Unlike the crown proceedings Act, 1947(England), we don't have any statutory provisions mentioned in the liability of State in India. According to Article 300 of the Indian constitution, the Union of India and the states can sue and can be sued. However, under what circumstances that can be done is not stated. But there are number of High Court and Supreme Court judgements, it appears that courts hold the state liable for torts committed by its servant only in the exercise of the non-sovereign functions (dependent functions) . In the case of independent (sovereign functions) case the state can't be made liable for the tortious acts committed by its servants. [14]
In the case of Peninsular and Oriental Steam Navigation Company v. Secretary of State of India[15], The Supreme courts classified the functions into parts i.e.,
  1. Sovereign Functions- Here, the state is not liable. Example, defence activities
  2. Non-Sovereign Functions

In the case of The secretary of State v. Hari Bhanji and Another,[16] the wall between the sovereign and non-sovereign functions got demolished. Most of the acts of the state are sovereign only. Her the act complained is of professedly done under the sanctions of municipal law and in the exercise of powers conferred by that law, the fact that it is done by the sovereign powers is not an act which could possibly be done by a private individual, doesn't oust the jurisdiction of the civil court. The law commission of India said that here, the law was correctly stated and laid down.

The Acts of the Police Officials
In Pagadla Narasiham v. The Commissioner and special Officer, Nellore Municipality[17] a bus belonging to the plaintiff, which had been wrongly parked and caused obstruction to the traffic, was removed by the traffic police with the assistance of the municipal employees. The act of the police officers was held to be justified and in discharge of sovereign functions, and therefore they could not be held liable for the same.

Negligence of Military Servants
Although the military servants or maintenance of the army comes under the sovereign function but it doesn't necessarily mean that the state will be immune from any of the tortious act committed by the army.

What is the principle governing Vicarious Liability with the help of judgements?

The principles of vicarious Liability are:
  1. The person who cause the damage must pay the compensation
  2. In order to constitute it as a vicarious liability, there should be some legal relationship between the two parties.( defendant and the other party). Like for example- in partnership, the two partners are jointly liable for the defaults of each other.
  3. It should be done during the course of employment which can basically be seen in the situation of master-servant relationship.

In Gregory v. Piper[18], the defendant and plaintiff had some disputes between them and the defendant, therefore, ordered his servant to place rubbish across a pathway to prevent the plaintiff from proceeding on that way and the servant took all care to ensure that no part of it was touching the part of the plaintiff's property but with the passage of some time.

The rubbish slid down and touched the walls of the plaintiff and thus he sued for trespass. The defendant was held liable despite his servant taking all due care. So here, the servant has done some wrongdoing as a result his master is liable for compensating.

In Pushpabai Purshottam Udeshi and Or. V. Ranjit Ginning and Pressing Co. (P)[19], deceased was travelling in a car driven by the manager of the respondent company and it met with an accident as a result of which he died. The dependents of the deceased filed a claim and the tribunal allowed damages but on appeal to the High Court, it was set aside on the grounds that the accident does not make the respondent company liable.

But the Supreme Court in its judgement overruled the judgement of the High Court and held that from the facts of the case it was clear that the accident had occurred due to the negligence of the manager who was driving the vehicle in the course of his employment and therefore, the respondent company was liable for his negligent act.

In Anita Bhandari and ors. V. Union of India[20], The husband of the petitioner went to a bank and while entering inside it, the cash box of the bank was also being carried inside and as a result, the security guard in a haste shot him and caused his death.

The petitioner had claimed that the bank was vicariously liable in the case because the security guard had done such act in the course of employment but the bank had contended that it had not authorized the guard to shoot. The Court held the bank liable as the act of giving him gun amounted to authorize him to shoot when he deemed it necessary and while the guard had acted overzealously in his duties but it was still done in the course of employment.

The two supreme courts cases were:
  1. In the case of Mohamud v. WM Morrison Supermarkets[21], Mr Mohamud was a petrol station customer and one of the employees of the Morrison supermarket were abusing and physically assaulting Mr Mohamud. The employee's name was Mr Khan. Mr Khan took Mr Mohamad took him at the back of the of the petrol station punching and beating him badly and kicking hi to the ground. Mr Khan ignored the instruction of his supervisor who tries to stop him. At first, he was not considered as liable. But then Mr Mohamad Case was heard by the Supreme Court and Supreme court said that Mr Khan actions were closely connected to his employment that Morrison should be vicariously liable for his actions.
     
  2. In the case of Cox v. Ministry of Justice [22] a prisoner who was doing some compulsory work in the kitchen, dropped a sack of rice on the catering manager which result in the back injury. It was asked that whether the ministry of justice as liable for his actions or not. The country court found out that MOJ is not vicariously liable as they both are not into any relationship of an employer and a employee. When the case went to the supreme court, then they said that it does not matte whether the prison was not carrying any activities of commercial nature but he was receiving some kind of wages by MOJ. Even though it is not in the form of profit. So the Supreme Court considered MOJ liable for the act of the prisoner.
All these case laws work on the concept of Vicarious Liability which tells about master and servant relationship.

Conclusion
The rule of vicarious liability can be seen out from a famous doctrine of qui facit per se per alium facit per se [23]. So the master will be held liable for all the negligent act done by the employees during the course of employment. But if someone is an independent contractor i.e., who works on behalf of someone or who is not a direct worker under someone then that person is not responsible for the tort committed by that contractor.

As it is based on the rule of principal-agent it is said that the agent should not commit any wrongful act which make the principal liable. Even the principal should keep in mind that the agent does not commit any wrong act. For that the employers conduct and make strict code of conduct so that this situation won't arise often.

Other than this principle the vicarious liability of the state also talks about whether the government servants's wrongful act make the state liable or not. Some cases highlighted above proves this situation. State's liability for the acts or omissions of statutory authorities arises only in cases where the statutory authority acts outside his legal authority while purporting to act pursuant to the legal authority conferred upon him and the act or omission, which causes or results in damage to a person, is not within the ambit of the statutory protection, if any, contained in such enactments.[24]

The present position in India is uncertain. In the First report on the Liability of State in Tort The India's law commission has recommended legislation prescribing State liability of England. On the basis of tat report the 'Government Bill' was introduced IN the Lok Sabha. That bill teels about the liability of the government towards the third party for the wrongdoing of the servant or employees. Unfortnately this law commission made long back did'nt came into effect still properly. It is hoped that it will paas soon without much delay.

References:
  1. Vicarious Liability. (1953). The British Medical Journal, 1(4823), 1338-1339. Retrieved July 4, 2021
  2. S. Preeti . Vicarious Liability in India. Legal Service India. Retrieved July 3, 2021
  3. Teacher, Law. (November 2013). What is Vicarious Liability?
  4. V. Chidige (2020). Law of Torts: Vicarious Liability of State. Lexlife India. Retrieved July 4, 2021
End-Notes:
  1. Vicarious Liability ( Vol. 1, No. 4823 (Jun. 13, 1953),edn, BMJ, The British Medical Journal ) 1338-1339
  2. https://www.jstor.org/stable/20311610
  3. https://www.jstor.org/stable/1071099
  4. https://www.jstor.org/stable/43949824
  5. https://www.jstor.org/stable/43950031
  6. https://www.jstor.org/stable/41819968
  7. S. Preeti . Vicarious Liability in India. Legal Service India. Retrieved July 3, 2021, from http://www.legalservicesindia.com/article/1634/Vicarious-Liability-in-India.html
  8. The State of Rajasthan v. Smt Shekhu and ors I (2005) ACC 156
  9. All Answers ltd, 'What is Vicarious Liability?' (Lawteacher.net, July 2021)
  10. Ormod v.Crosville Motor Services Ltd (1953) 2 All E.R. 753 : (1950) 1 W.L.R. 1120.
  11. Maganbhai v. Ishwarbhai A.I.R. 1984 Guj. 69.
  12. Rajasthan State Road Transport Corpn. v. K.N. Kothari A.I.R. 1997 S.C. 3444.
  13. Hillyer v. St. Bartholomew's Hospital (1909) 2 K.B. 820
  14. V. Chidige, Law of Torts: Vicarious Liability of State (Avani laad, LexLife)
  15. Peninsular and Oriental Steam Navigation Company v. Secretary of State of India(1861)5 Bom.H.C.R. App. I,p.1
  16. The secretary of State v. Hari Bhanji and Antr. I.L.R. (1882) 5 Madras 273.
  17. A.I.R. 1994 A.P. 21.
  18. Gregory v. Piper [1829] 9B & C 591
  19. Pushpabai Purshottam Udeshi and Or. V. Ranjit Ginning and Pressing Co. (P) 1977 AIR 1735, 1977 SCR (3) 372
  20. Anita Bhandari and ors. V. Union of India (2005) ACC 780
  21. Mohamud v. WM Morrison Supermarkets Plc (Rev1) [2016] UKSC 11 (2 March 2016)
  22. Cox v. Ministry of Justice (2016) UKSC 10
  23. he who does an act through another does the act himself
  24. R. Subhyanka, Vicarious Liability of State (, Lawctopus)

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