VICARIOUS LIABILITY
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1) Vicarious liability is a legal tort doctrine that assigns responsibility upon one person for the failure of another, with whom the person has a special relationship (such as employer and employee or owner of vehicle and driver), to exercise such care as any reasonable prudent person would use under similar circumstances. In other words, it imposes strict liability on employers for the wrongdoings of their employees, who have acted negligently.

2) The elements of the doctrine include that: the person who commits the wrong must be an employee, the employee must have committed a tort and it must have been committed in the course of employment.
In regards to the first requirement for imposing VL, the rule is that an employer can only be liable for torts committed by employees. There is generally no liability for torts committed by independent contractors (although there can be in certain exceptional situations). However, it is not always possible to determine at first sight whether in fact a person is employed under a contract of service or not. It will often be in the interest of an ‘employer’ to deny that the relationship is one of employment. It has been suggested in WHPT Housing Association Ltd v. Secretary of State for Social Services that the distinction lies in the fact that the employee provides himself to serve while the self- employed person only offers his services.

6) Once it has been established that sufficient relationship of employer and employee exists, it is necessary that any tort is committed strictly ‘in the course of employment’. What is and is not in the course of employment is a question of fact for the court to determine in each case. It is often difficult to see any consistence in the judgments. It seems inevitable that judges will decide cases on policy grounds and this may explain some of the apparent inconsistency. As with distinguishing an employer and employee relationship, there is no one test which adequately establishes which acts employers are vicariously liable for. Such determinations rest upon precedent, and the facts of each individual case. A preferred test of the courts was formulated in Lister v. Hesley Hall, which states that an employer will be liable in two instances: for a wrongful act that has been authorised by the employer and for an act that, while authorised, was carried out in an unauthorised way.
With regard to authorised acts, it is not entirely clear whether the employer can be said to have authorised a tortuous act by implication and should therefore be liable, though the case of Poland v. Parr has suggested that this is possible.

17) In regards to authorised acts carried out in an unauthorised manner, an employer does not necessarily evade liability by stating that a particular way of carrying out the job is unauthorised, and this principle was demonstrated in the following line of cases:
Limpus v. London Omnibus Co where the employee is still engaged in his own work but does something else even though this has been expressly prohibited by the employer; Century Insurance v. Northern Ireland Transport Board where the employee carries out work that is authorised but is doing the work negligently; Rose v. Plenty where the employee gives unauthorised lifts contrary to instructions; Fennelly v. Connex South Eastern Ltd where the employee exceeds the proper boundaries of the job and Bayley v. Manchester Railway where the employee applies force in order to achieve the employer’s objectives;

18) There are acts committed by employees where the employers will not be held liable since the court finds that the employee was ‘on a frolic of his own’. Such were the cases of: Beard v. London General Omnibus Co and Storey v. Ashton. By contrast in Twine v. Beans Express, the employers were not held liable for giving unauthorised lifts, the opposite of what appears to be a fairly similar situation in Rose v. Plenty. The significant difference is that here the employer was gaining no benefit from the prohibited lift. In Smith v. Stages the employer was held liable because the employees were paid both travelling expenses and travelling time and therefore the journey was accepted as falling within the course of employment.

19) In general an employer will not usually be liable for the crimes of an employee that also amount to torts and this principle was established in the case of Warren v. Henleys. The courts are more prepared to consider that dishonesty of an employee falls within the course of employment and therefore to impose liability on the employer. This might apply in the case of fraud, as it did in Lloyd v. Grace Smith. However, the courts will generally not make an employer liable for an employee’s fraudulent activities where they occurred partly in and partly outside the course of the employment, as was the case in Credit Lyonnais Bank Nederland v. Exports Credits Guarantee Department.

Finally, it is also important to note that is rare but possible to recover the loss from the employee, as Lister v. Romford Ice shows. The case has been strongly criticised, not least because it destroys the purpose of imposing vicarious liability. Furthermore, in some cases it is possible for owners to be liable for torts committed in cars that they have lent to the tortfeasor, as Morgans v. Launchbury illustrates.

20) Generally, an employer will be held liable for any tort committed while an employee is conducting their duties. Historically, it was held that most intentional wrongdoings were not in the course of ordinary employment, but recent case law suggests that where an action is closely connected with an employee's duties, an employer can be found vicariously liable.

21) Several reasons have been advanced as a justification for the imposition of vicarious liability:
(1) The master has the 'deepest pockets'. The wealth of a defendant, or the fact that he has access to resources via insurance, has in some cases had an unconscious influence on the development of legal principles.
(2) Vicarious liability encourages accident prevention by giving an employer a financial interest in encouraging his employees to take care for the safety of others.
(3) As the employer makes a profit from the activities of his employees, he should also bear any losses that those activities cause.