Vicarious Liability including State Liability
Generally speaking a person is liable for his own acts but in many cases he may be held responsible for the torts committed by others. This is known as the “Vicarious Liability”, i.e., liability incurred for, or instead of, another.
The common examples of such a liability are: liability of the principal for the tort of his agent; liability of partners for each others torts; and, liability of the master for the tort of his servant.
Liability arising out of a Special Relationship
Principal and agent:
when the principal expressly or impliedly authorises some act to be done, he is liable for such an act of the agent if the same has been done in the course of performance of his duties as an agent.
The law attaches liability to the principal for the wrongful act of his agent, on the ground that it is the principal who has selected the agent.
In case State Bank of India V. Shyama Devi, the court held that if a bank employee receives some cash and cheques from his friend, in his personal capacity without giving any proper receipt, for depositing the same with the bank, the bank cannot be made liable, if the employee misappropriates the cash and cheques.
The relation of partners inter se is that of principal and agent, and each partner is, therefore, liable to third persons for the neglect or fraud of his fellow-partner.
If any one of the partner commit any tort in the ordinary course of business of the firm, all the other partners in the firm are liable for that to the same extent as the guilty partner.
The liability of each partner is joint and several.
Company and its directors: Companies are liable for torts committed by their servants in the course of their employment.
But the wrongful act complained of should be intra vires and not ultra vires (i.e., it should be within the power of the company) and should be e done for the company. Directors are personally responsible for any tort which they themselves commit or direct others to commit, although it may be for the benefit of the company.
Master and servant:
A master is liable for the torts committed by his servant while acting in the course of his employment. The servant is also liable. They are considered to be joint tort-feasors and their liability is joint and several. The master's liability arises when the following essentials are present:
The tort was committed by his servant;
The servant committed the tort while acting in the course of the employment.
The master’s liability arises only when both these conditions are satisfied.