June 27, 2022
“Vicarious liability” is a form of liability which arises from responsibility for the acts of others.
The most common form of vicarious liability is the liability of an employer for the acts of their employees. Other common examples include liability of a principal for the action of their agents, parental liability for children in certain circumstances, and other situations in which the degree of control or nature of the relationship is close enough be treated as vicarious liability.
Vicarious liability is a form of strict liability. What that means is that the employer will be responsible in law even if they themselves did nothing wrong.
In the area of employers’ liability, the most frequent defense involves whether the employee was acting in the course of their employment. Vicarious liability may apply even if the employee does an act in the course of business but does so in an unauthorized or even illegal manner. This, for example, is how employers will become vicariously liable for sexual harassment or sexual assault.
Vicarious liability may not be found if the employee is “on a frolic of their own” but the law is developing to restrict that defense so that where the “frolic” arises out of a situation or opportunity created by or in the workplace, vicarious liability may be found.
Another issue which arises in employers’ liability is the distinction between an employee and an independent contractor. Increasingly, courts will blur the distinction and look at the degree of control that the “employer” has over the individual actor regardless of whether they are legally an employee or a contractor. Vicarious liability is also likely to be found where the individual actor is an integral part of the employer’s business, regardless of their legal status.
An example of principal and agent liability is the liability of an owner of a vehicle for the actions of the driver. However, the concept of principal and agent liability extends further and, for our purposes, you want to be particularly aware of the risks that arise in business.
Where the agent is carrying out the principal’s business, their wrongful acts are treated as if they are the acts of the principal (the business owner). In these situations, vicarious liability might be found whenever the agent has apparent authority to act for the principal, even if the improper act had been expressly prohibited, unless the injured party knew or ought to have known of the limits this vicarious liability.
Parental liability is generally limited and is more often framed in direct negligence against the parents for lack of supervision or instruction of their children. This is not true vicarious liability. Ontario’s Parental Responsibility Act, however, does create a form of limited vicarious liability for damages caused by children within the limits of Small Claims Court.
Because vicarious liability is part of the common law developed through court decisions, it continues to evolve in response to changing social circumstances. The nature of the relationships that may create vicarious liability is not set in stone. In response to institutional sexual assaults, some of the institutional relationships have been found to create vicarious liability, while others have not. This is a very subtle area of development that requires careful legal research if you want to be certain about your position.
Entire books have been written about vicarious liability, so in a short article, we cannot possibly answer all your questions or cover the complete implications of vicarious liability. Although the general concepts are well known, the application to specific fact situations maybe tricky.
You should take great care in selecting who you trust to do business on your behalf.
The combination of business lawyers and litigation lawyers at Weilers LLP creates an exceptional opportunity if you wish to consult with us about the legal implications of your risk management and how vicarious liability may play a role.
if you are sued on the basis of vicarious liability, our litigation team is well equipped to advise you, including the insurance aspects, and to represent you if necessary.
If you would like to know more about how vicarious liability affects you or your business, please feel free to contact us.