Agency - Liability of Principal to Third Parties for Tort of an Agent

Question 1

A principal will be liable for torts committed by its agent if:

Answer 1

1) there is a principal/agent relationship, and

2) the tort was committed by the agent within the scope of that relationship

Question 2

The principal-agent relationship requires:

Answer 2

1) Assent - informal agreement between principal (who has capacity) and the agent
2) Benefit - the agent’s conduct must be for the principal’s benefit
3) Control - the principal must have the right to control the agent by having he power to supervise the manner of the agent’s performance.

Question 3

Scope of Principal-Agent Relationship

Answer 3

1) Conduct was within scope of employment
2) Tort occurred while on the job (frolic v. detour)
3) If agent, even in part, intended to benefit the principal by its conduct, this is enough to be within the scope

Question 4

Frolic

Answer 4

A new and independent journey –> outside the scope of agency

Question 5

Detour

Answer 5

Near departure from assigned task –> inside the scope of agency

Question 6

The principal will be liable for a sub-agent’s tort only if there is:

Answer 6

Assent, benefit, and control between principal and sub-agent tortfeasor.

Typically, the P does not assent to the sub-agent’s help and does not have the right to control the sub-agent. Therefore, there is no vicarious liability for a sub-agent’s tort

Question 7

The principal will be liable for a borrowed agent’s tort only if there is:

Answer 7

Assent, benefit, and control between P and the borrowed agent tortfeasor.

Typically, the borrowing principal does not assume any right to control the borrowed agent. Therefore, there is no vicarious liability for a borrowed agent’s tort.

Question 8

Key distinction between an agent and an independent contractor is:

Answer 8

There is no right to control an independent contractor because there is no power to supervise the manner of its performance

Question 9

Vicarious liability rule for Independent Contractors

Answer 9

NO vicarious liability for independent contractor’s torts. Exceptions:

1) Inherently dangerous activities
2) Estoppel - if you hold out independent contractor with the appearance of agency you will be estopped from denying liability

Question 10

Vicarious Liability and Intentional Torts

Answer 10

General Rule: Intentional torts are generally outside the scope. Exception: Intentional torts are within the scope if the conduct was:

1) authorized by the principal, OR
2) natural from the nature of employment (bouncer, security guard), OR
3) motivated by a desire to serve the principal