Table of Contents

Generally, a person is liable for his own wrongful acts and does not incur any liability for the acts of others. In certain cases, however, vicarious liability, that is the liability of one person for the act done by 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 a certain kind of relationship between A and B, and the wrongful act should be, in a certain way, connected with that relationship.


The common examples of a such a liability are:

  1. Principal and Agent
  2. Partners (liability of each other’s tort)
  3. Master and Servant


When an agent commits a tort in the course of performance of his duty as an agent, the liability of the principal arises for such a wrongful act. The agent is liable because he has done the wrongful act. The principal is liable vicariously because of the principal-agent relationship between the two. Both can be made liable for the same wrongful act. They are considered to be joint tortfeasors and their liability is joint and several. In such a case, the plaintiff has a choice either to sue the principal, or the agent, or both of them.


Similarly, when the wrongful act is done by one partner in the ordinary course of the business of the firm, all the other partners are vicariously liable for the same. All the partners of the firm, i.e. the guilty partner and the others are considered to be joint tortfeasors. Their liability is also joint and several.


The same rule applies in the case of master-servant relationship. The master is vicariously liable for the wrongful act done by his servant in the course of employment. The liability of the master, of course, is in addition to that of the servant.


Principal and Agent Relationship


Where one person authorises another to commit a tort, the liability for that will be not only of that person who has committed it but also of that who authorised it.


It is based on the general principle “Qui facit per alium facit per se” which means that “the act of an agent is the act of the principal.” For any act authorised by the principal and done by the agent, both of them are liable. Their liability is joint and several.


Relevant Case Laws:

Some relevant case laws with respect to Principal and Agent Relationship are as follows: -


  1. Lloyd v. Grace, Smyth and Co. (1912) – In this case, Mrs. Lloyd, who owned two cottages but was not satisfied from the income therefrom, approached the office of Grace, Smith and Co., a firm of solicitors, to consult them about the matter of her property. The managing clerk of the company attended her and advised her to sell the two cottages and invest the money in a better way. She was asked to sign two documents, which were supposed to be sale deeds. In fact, the documents got signed were gift deeds in the name of the managing clerk himself. He then disposed of the property and misappropriated the proceeds. He had acted solely for his personal benefit and without the knowledge of his principal. It was haled that since the agent was acting in the course of his apparent or ostensible authority, the principal was liable for the fraud.


  1. State Bank of India v. Shyama Devi (1978) – In this case, the plaintiff’s husband gave some amount and cheques to his friend, who was an employee in the defendant bank for being deposited in the plaintiff’s account. No proper receipt for the deposits was obtained. The bank employee misappropriated the amount. It was held by the Supreme Court that the employee, when he committed the fraud, was not acting in the scope of bank’s employment but in his private capacity as the depositor’s friend, therefore, the defendant bank could not be made liable for the same.  


  1. Omrod v. Crosville Motor Service Ltd. (1953) – In this case, the owner of a car asked his friend to drive his car. While the car was being so driven by the friend, it collided with a bus. The owner of the car was held liable.  


  1. Trilok Singh v. Kailash Bharti (1986) – In this case, while the owner of the motor cycle was outside the country, his younger brother took the motor cycle without his knowledge or permission and caused the accident. It was held that the younger brother could not be deemed to be the agent of the owner of the motor cycle and the latter could not be vicariously liable for the accident.


Partners


The relationship as between partners is that of principal and agent. The rules of the law of agency apply in case of their liability also. For the tort committed by any partner in the ordinary course of the business of the firm, all the other partners are liable therefor to the same extent as the guilty partner. The liability of each partner is joint and several.


Relevant Case Law:

Here is a relevant case law with respect to relationship between partners: -


  1. Hamlyn v. Houston and Co. – In this case, one of the two partners of the defendant’s firm, acting within the general scope of his authority as a partner, bribed the plaintiff’s clerk and induced him to make a breach of contract with his employer (plaintiff) by divulging secrets relating to his employer’s business. It was held that both the partners of the firm were liable for this wrongful act (inducing breach of contract) committed by only one of them.


Master and Servant


If a servant does a wrongful act in the course of his employment, the master is liable for it. The servant, of course, is also liable. The wrongful act of the servant is deemed to be the act of the master as well.


The doctrine of liability of the master for the act of his servant is based on two maxims:

  1. Respondeat Superiror – which means, ‘let the principal be liable’.
  2. Qui facit per alium facit per se – which means, “he who does an act through another is deemed in law to do it himself.”


Since for the wrong done by the servant, the master can also be made liable vicariously, the plaintiff has a choice to bring an action against either or both of them. Their liability is joint and several as they are considered to be join tortfeasors.


The reason for the maxim Respondeat Superior (let the principle be liable) seems to be the better position of the master to meet the claim because of his larger pocket and also ability to pass on the burden of liability through insurance. The liability arises even though the servant acted against the express instructions, and for no benefit of his master.


For the liability of the master to arise, the following two essentials are to be present:

  1. The tort was committed by the ‘servant’.
  2. The servant committed the tort in the ‘course of his employment’.


Who is a Servant?

A servant is a person employed by another to do work under the directions and control of his master. As a general rule, master is liable for the tort of his servant but he is not liable for the tort of an independent contractor.


Distinction between Servant and Independent Contractor:


  1. A servant is an agent who is subject to the control and supervision of his employer regarding the manner in which the work is to be done. For Example: My car driver is my servant. If he negligently knocks down X, I will be liable for that.

  

  1. An independent contractor is not subject to any such control. He undertakes to do certain work and regarding the manner in which the work is to be done. He is his on master and exercises his own discretion. For Example: If I hire a taxi for going to railways station and the taxi driver negligently hits X, I will not be liable towards X because the driver is not my servant but only an independent contractor. The taxi driver alone will be liable for that.


What is Course of Employment?

An act is deemed to be done in the course of employment, if it is either:


  1. A wrongful act authorised by the master, or
  2. A wrongful and unauthorised mode of doing some act authorised by the master.


Relevant Case Laws:

Some relevant case laws with respect to Master and Servant relationship are as follows: -


  1. Morgan v. Incorporated Central Council (1936) – In this case, the plaintiff, while he was on a lawful visit to the defendant’s premises, fell down from an open lift shaft and got injured. The defendants had entrusted the job of keeping the lift safe and in proper order to certain independent contractors. It was held that for this act of negligence on the part of the independent contractors in not keeping the lift in the safe condition, the defendants could not be made liable.


  1. B. Govindarajulu v. M.L.A. Govindaraja Mudaliar (1966) – In this case, after a motor lorry was entrusted by its owner for repairs, while an employee of the repair workshop drove it, there was an accident. It was held by the Madras High Court that for this accident, the owner of the lorry was not liable vicariously, because the owner of the workshop was an independent contractor and not the servant of the lorry owner.


  1. Rajasthan State Road Transport Corporation v. K.N. Kothari – In this case, the RSRTC hired a bus and a driver for running a bus on a specified route. The RSRTC engaged a conductor, who managed the bus, collected fare from passengers and also exercised control over the driver. It was held that for an accident caused by the driver, the hirer (RSRTC) was vicariously liable, notwithstanding the fact that the driver continued to be on the payroll of the original owner. It has been held by the Supreme Court that the transfer of effective control over a servant, would make the transferee of the vehicle liable for vicarious liability.

 

  1. Cassidy v. Ministry of Health (1951) – The hospital authorities are liable for the professional negligence of their staff including radiographers, resident house surgeons, assistant medical officers and nurses and part-time anaesthetists. In this case, the hospital authorities were held liable when, due to the negligence of the house surgeon and other staff, during post-operation treatment, the plaintiff’s hand was rendered useless.


  1. Smt. Kundan Kaur v. Shankar Singh (1966) – In this case, Shankar Singh and Tarlok Singh, the partners of a firm, temporarily gave their truck along with a driver on hire to one Jawahar Transport Co. for transporting certain goods from one place to another. While the goods were being transported, Kundan Lal Kohli, an employee of Jawahar Transport Co., seated himself by the side of the driver. As a result of rash and negligent driving of the driver, the vehicle met with an accident and Kundan Lal Kohli, who was sitting by the side of the driver, was instantaneously killed. The High Court held that there was only a transfer of services and not of control of the driver from the general employer to the hirer of the vehicle and as such, Shankar Singh and Tarlok Singh were liable for the same.  


  1. Beard v. London General Omnibus Company (1900) – In this case, at the end of the journey, the driver of a bus went to take his dinner. During the temporary absence of the driver, the conductor drove the bus in order to turn it round to make it ready for the next journey and negligently caused an accident whereby the plaintiff was injured. It was not the conductor’s duty to drive the bus. Since the driving was not the kind of act which the conductor was authorised to do, the conductor was acting out of the course of his employment and the defendant company was, therefore, held not liable.


  1. Limpus v. London General Omnibus Company (1862) – In this case, the defendant’s driver in defiance of the express instruction not to race with, or cause obstruction to, other omnibuses, tried to obstruct a rival bus, and thereby caused an accident. The driver had been engaged to drive and his act was a negligent mode of driving and it was held to be within the course of employment, in spite of the express prohibition. The defendant company was held liable.


Basis of Master’s liability for act of servant:


1. Respondeat Superior – Let the principal be liable.


2. Qui Facit Alium Facit Per Se – One who acts through another, is deemed to have done himself.


3. Power of Selection – One of the justification for master’s liability is that the master can exercise care in selecting the efficient and competent hands. If he selects any incompetent person, he must suffer for his neglect of duty.


4. Power of Control – Vicarious Liability is more often justified on the basis of control. This in fact, is the most effective test of master’s liability. He can punish the servant or remove him from service if he proves to be incompetent. The master has opportunity in most of the cases to control the manner of the work done by the servants and at least he has a right to control his activities.


5. Beneficiary of Service – The liability is also justified on the ground that the master takes the benefit of the service of hi servant and therefore the losses should also be beard by the master.

 

6. Capacity to Pay – Servants are usually financially incapable to pay the compensation to the injured party whereas the master usually is.


7. Distribution of Loss – Imposition of liability on the master for the tort of his servant also helps in spreading over the loss and in distributing it among the beneficiaries of the activity.


Doctrine of Common Employment


The rule known as doctrine of common employment was an exception to the rule that a master is liable for wrongs of his servant committed in the course of his employment. The rule was first applied in 1837, in Priestly v. Fowler (1837). It was firmly established as a part of English Law by subsequent decisions.


The doctrine was that a master was not liable for the negligent harm done by one servant to another fellow servant acting in the course of their common employment.


  1. Priestly v. Fowler (1837) – In this case, the plaintiff, who was the defendant’s servant, was injured at his thigh due to breaking down of an overloaded carriage in the charge of another servant of the defendant. Since both the wrongdoer and the injured person were the servants of the same master, the doctrine of common employment was applicable and the master was held not liable.


Essentials for the application of doctrine of common employment:

  1. The wrongdoer and the person injured must be fellow servants, and
  2. At the time of the accident, they must have been engaged in common employment.


The doctrine was criticized, limited in scope by legislation and judicial decisions. It was eventually abolished by the Law Reforms (Personal Injuries) Act, 1948, which provided that:

It shall not be a defence to an employer who is sued in respect of personal injuries caused by the negligence of a person employed by him, that the person was, at the time the injuries were caused, in common employment with the person injured.