DR.

RAM MANOHAR LOHIYA

NATIONAL LAW UNIVERSITY
Academic session 2015-16

FINAL DRAFT OF
LAW OF TORTS
On: “Principle of hire and fire in vicarious liability”

Guided by: Submitted by:

Mr. R.K. Yadav Shailesh kumar
Asst. Professor Sec:B
Dr. Ram Manohar Lohia National Roll no:123
Law University,Lucknow
ACKNOWLEDGEMENT

I express my gratitude and deep regards to my teacher for the subject Mr.R K Yadav for giving me such a
challenging topic and also for his exemplary guidance, monitoring and constant encouragement throughout
the course of this thesis.

I also take this opportunity to express a deep sense of gratitude to my seniors in the college for their cordial
support, valuable information and guidance, which helped me in completing this task through various stages.

I am obliged to the staff members of the MadhuLimaye Library, for the timely and valuable information
provided by them in their respective fields. I am grateful for their cooperation during the period of my
assignment.

Lastly, I thank almighty, my family and friends for their constant encouragement without which this
assignment would not have been possible

- Shailesh Kumar
TENTATIVE CHAPTERISATION:

Introduction
Principles

Latin terms

Objective of research
Research methodology
Literature review

Definition of Vicarious Liability

Principle of hire and fire

Hire and fire test

Cases referred
Conclusion
Bibliography
INTRODUCTION
This project deals with the principle of hire and fire in vicarious liability. Vicarious liability is one of the
most important part of torts which is basically concerned with holding the master responsible for the
wrongful acts of the servant done in the course of employment. The word ‘vicarious’ is derived from the
Latina word for ‘change’ or ‘alteration’. Vicarious liability is an aberration from the norm of holding the tort
feasor liable for damage caused by their own tortuous liability. It is also referred to as imputed negligence.
Legal relationships that can lead to imputed negligence include the relationship between parent and child,
husband and wife, owner of a vehicle and driver, and employer and employee etc.
We need to remember that
tort law has evolved from various judgments given by the court. The reason why master was held liable for
the servant’s wrongful act is because in various cases it was found that the servant did not have enough
resources to compensate the plaintiff. In this case the very purpose of “damage” i.e. restoration to the
position before the wrongful act’ was defeated.
The basic question of this project is primarily to decide, the
cases where the servant is liable for the wrongful act of the master or not.

OBJECTIVE OF RESEARCH
This project deals with the principle of hire and fire test in vicarious liability. The basic question of this
project is primarily to decide, the cases where the servant is liable for the wrongful act of the master or not.

RESEARCH METHODOLOGY
Doctrinal Methodology is followed throughout the project. Secondary Sources have to be used due to
absence and impossibility of First Hand surveys and information.

The content is descriptive and analytical. An in-depth study of “Principle of hire and fire in vicarious
liability” propounded in cases dealing with vicarious liability, and Analysis of those excerpts and their
application has been done and presented accordingly.
PRINCIPLES:
We need to remember that tort law has evolved from various judgements given by the courts. The reason
why master was held liable for the servant’s wrongful acts is because in various cases it was found that the
servant did not have enough resources to compensate the plaintiff. In this case the very purpose of
“damages” i.e. restoration to the position before the wrongful act, was defeated.

The courts then decided to apply two very important principles to fix liability in such cases. The first is “qui
facit per aliumfacit per se” meaning he who acts through another is deemed to have acted himself. The
servant’s act in the course of employment are generally (I use

”generally” because of the recent developments in vicarious liability-I’ve explained later on) for the master’s
benefit and hence it is only fair that he be held liable

The other principle is “respondent superior”, which means let the principal be liable for reasons I’ve just
mentioned

ESSENTIALS OF VICARIOUS LIABILITY:

There are basically two conditions to be fulfilled for the master to be liable:

The person so charged should be a “servant”

The wrongful act should be in the “course of employment”

Hire and Fire Test: -

This test is done to distinguish between the servant and the independent contractor. To apply this rule, we
need to check whether the person employed may be fired or not. Does he receive salary as his remuneration
or not? If yes, then this test is fulfilled.

Basis of Test –a person being able to give instruction on the manner of what is to be done and how it should
be done.

LATIN TERMS

i) Qui facit per aliumfacit per se

It is a Latin legal term meaning, "He who acts through another does the act himself." It is a fundamental
maxim of the law of agency1. This is a maxim often stated in discussing the liability of employer for the act
of employee."

1
Stroman Motor Co. v Brown, 116 Okla 36, 243 P 133.
According to this maxim, if in the nature of things the master is obliged to perform the duties by employing
servants, he is responsible for their act in the same way that he is responsible for his own acts.

The maxim is a shortened form of the fuller 18th-century formulation: qui facit per alium, estperinde ac
sifacit per se ipsum, i.e. “whoever acts through another acts as if he were doing it himself.”

ii) Respondent superior

"Let the master answer

It is a doctrine, which states that, in many circumstances, an employer is responsible for the actions of
employees performed within the course of their employment.This rule is also called the "Master-Servant
Rule", recognized in both law and civil law jurisdictions.

In a broader scope, respondent superior is based upon the concept of vicarious liability2.

OBJECTIVE OF RESEARCH
This project deals with the principle of hire and fire test in vicarious liability. The basic question of this
project is primarily to decide, the cases where the servant is liable for the wrongful act of the master or not.

RESEARCH METHODOLOGY

Doctrinal Methodology is followed throughout the project. Secondary Sources have to be used due to
absence and impossibility of First Hand surveys and information.

The content is descriptive and analytical. An in-depth study of “Principle of hire and fire in vicarious
liability” propounded in cases dealing with vicarious liability, and Analysis of those excerpts and their
application has been done and presented accordingly.

2
Harger, Lloyd. "Workers' Compensation, A Brief History". Florida Department of Financial Services. Retrieved 22
June 2010.
LITERATURE REVIEW
Law of Torts by R.K Bangia is a wonderful book for understanding of torts. It elucidates the tort of
negligence with lucidity and clearly. It also cites the important landmark cases concerning negligence.

VICARIOUS LIABILITY
Vicarious liability is one of the most important part of torts which is basically concerned with holding the
master responsible for the wrongful acts of the servant done in the course of employment

The word 'vicarious' is derived from the Latin word for 'change' or ‘alteration’. Vicarious liability is an
aberration from the norm of holding the tort feasor liable for damage caused by their own tortious liability. It
is also referred to as imputed negligence. Legal relationships that can lead to imputed negligence include the
relationship between parent and child, husband and wife, owner of a vehicle and driver, and employer and
employee etc3.

The persons who are held vicariously liable need not be personally connected to the tort or be in anyway
responsible. Thus vicarious liability is a form of strict liability. Many reasons have been advanced to justify
this departure from the fault principle. It is commonly said that the reasons behind the doctrine of vicarious
liability are first that the employer is in a better position to absorb the legal costs either by purchasing
insurance or increasing his prices. Secondly, that the imposition of liability should encourage the employer
to ensure the highest possible safety standards in running his business.

Every act which is done by an employee in the course of his duty is regarded as done by his employer’s
orders, and consequently is the same as if it were his employer’s own act.’ It is said that the doctrine of
vicarious liability has not grown from any very clear, logical or legal principle but from social convenience
and rough justice makes profit from the employee’s activities, it is only reasonable that the he bear any
losses caused by the same.

The most common example of vicarious liability is the liability of an employer for the torts of his employees
committed in the course of employment. It is not necessary in such circumstances for the employer to have
breached any duty that was owed to the injured party, and therefore it operates as strict or no-fault liability.
The most important element to establishing a case for vicarious liability is that the wrongdoer be acting as an
employee or employee, and that the wrong done be connected to the employee’s course of employment.

PRINCIPLE OF HIRE AND FIRE

A servant is a person employed by another to do work under the direction and control of his master. As a
general rule a master is liable for its servant torts not for his independent contractor. If an employee

3
www.lawteacher.co.uk
committed a tort but not in the course of employment, the employer may still be liable if the situation
involved a non-delegable duty.

The Test For Determination Of Relationship

(a) The Hire and Fire Test (control test) -

The basis of control test is to distinguish between servant and independent contractor. Though the servant is
under the control of his master regarding of manner of his doing the work, there are many cases in master
cannot control his servant. The control test developed from a series of cases that emphasised the degree of
control that could be exercised over a worker.

A servant is a person subject to the command of his master as to the manner in which he shall do his
work. … An independent contractor is one who undertakes to produce a given result, but so that in the
actual execution of the work he is not under the order or control of the person for whom he does it, and may
use his own discretion in things not specified beforehand.

The trend of modern authorities is to bring into the category of “servants” even those servants, which are not
subjected to any such control, thus, enormously increasing the ambit of the branch of vicarious liability. The
trend of the modern authority is to apply ‘HIRE’ and ‘FIRE’ test. If this should be the only control test this
allow the state authority and municipal corporation escape from liability of wrongful act of their servants
like house surgeons and engineers.

The application of the test meant that, for a long time, employers were not considered to be vicariously
liable for the actions of their professional staff where those actions involved the exercise of professional
skill.

CASES REFERED

i)Hillier v. The Governors of St. Bartholomew’s Hospital 1909 2 KB 820-

In this case the application of the ‘control’ test did not work.

The plaintiff brought an action against the governors of a hospital for damages for injuries alleged to have
caused to him during an operation by the negligence of some member of the hospital staff.

Held: The action was not maintainable. The only duty undertaken by the governors of a public hospital
towards a patient is to use due care and skill in selecting their medical staff. The relationship of master and
servant does not exist between governors and the physicians and surgeons who give their services, and the
nurses and other attendants at an operation cease for the time being to be the servants of the governors,
because at that time period they take their orders from the operating surgeon alone and not the hospital
authorities.

ii) Cassidy v. Ministry of Health [1951] 2 KB 343- In this case, the plaintiff entered a hospital for an
operation on his left concerning two fingers. While undergoing the operation he was under the care of the
surgeon who performed the operation and other medical officers and nursing staff of the hospital, all of
whom were employed under contracts of service. At the end of the operation his hand had been rendered
useless. The trial judge dismissed his action for damages for negligent treatment, which he brought against
the hospital on the ground that he had failed to prove any negligence.

Held On Appeal: In the circumstances, the doctrine of res ipsa loquitur applied, and thus the onus lay on the
hospital authority to prove that there had been no negligence on its part or on the part of anyone for whose
acts or omissions it was liable, and that the hospital authority had not discharged that onus.

Result

“The hospital authority is liable for the negligence of professional men employed by the authority under a
contracts of services as well as contracts for services. (Inadequacy of the control test) The authority owes a
duty to give proper treatment, and though it may delegate the performance of that duty to those who are not
its servants, it remains liable if its delegates inadequately perform that duty.

iii) K.P. Patel Vs. Gujarat Small Industries Corporation Ltd. and Ors.

a) Service - Termination - Petitioner, who was a confirmed Assistant Manager (works) in employment of
Respondent-Corporation, challenged order terminating his services.

b) Held, Respondent-Corporation was an instrumentality and agency of State and as such subjected to same
limitations in field of constitutional and administrative law as State itself, and, therefore, bound by mandate
of Articles 14 and 16 of Constitution of India.

No case had been made out that Petitioner had betrayed trust or that there was a loss of confidence or for
exigencies of service - Impugned order could not be claimed to be innocuous one notwithstanding its
outward format because Petitioner was removed from service within two months after his confirmation in a
senior position as Assistant Manager (works) where he earned two increments as clearly admitted by
Respondent-Corporation - Impugned order of removal was set aside - Petition allowed.

Result

A declaration is granted that the petitioner continues in service of the respondent-Corporation as Assistant
Manager (works) in the grade in which he was at the time of his removal as if the impugned order has not
been made, and consequently, therefore, the respondent-Corporation is directed to pay all the back wages up
to date and grant him all the benefits to which he would be entitled if the impugned order had not been
made. Rule is made absolute accordingly with costs.
iv) New India Assurance Company Limited Vs. R.S.R.T.C. &Ors.

a) Motor Vehicles - Compensation - Rejection of cross examination - Motor Vehicle Act, 1939 - Tribunal
awarded compensation to Claimants as "No Fault “liability" and held that owner of vehicle was responsible
for indemnifying passenger in case of injury caused to him or to dependent where passenger died due to
accident by vehicle owned by it.

b) Hence, this Appeal - Whether, Tribunal had erred in rejecting cross objection by Insurance Company -
Held, it was settled that findings recorded in suit or in litigation not only bound Plaintiff and Defendants
inter se but could also bound co-defendant in suit if such finding decided any issue between them and same
operated as res judicata in subsequent suit.

Result

The Corporation cannot claim, any amount by way of refund, but is liable for full amount of compensation
payable to claimants that has been determined by theTribunal. The insurer's liability under the policy being
not exceeding Rs.15, 000/- per passenger, it is not liable to any further sums.

Conclusion

An employer can be held liable for the torts of the employee only if the following claims are established.
Firstly, a tort must be committed. Secondly, the tortfeasor must be an employee and lastly, the tort must
have been committed in the “course of employment. Once the first claim is established, one has to prove that
the worker was indeed a servant/employ and not an independent contractor.
There are many tests suggested by many different legal scholars to determine the same. Some of these tests
are the control test, which checks whether the employer had the control of determining the method of
performance of the work of theemployee.

The Test is the hire and fire test which is used in modern times especially for torts committed by
professionals where there is no way to control the method of doing work. By this testone can determine if
the worker is under a contract of service or contract for service, and the employer is liable only if the first is
proved. Applicability of vicarious liability is possible only when “in the course of employment” criterions
satisfied. Although essential, this criterion has expanded to the point of allowing claims for vicarious
liability in cases where liability would not have arguably been imposed. This criterions a question of fact,
and it is immaterial whether the wrong committed by the employee was authorized or not. Course of
employment can be defined as the activities engaged in, the circumstances that exist, and the events
that occur that are normally part of an employee’s job, especially those directly related to the work that the
employee was hired to do. The time that the employee takes to complete his or her assigned tasks also comes
under this. It is important to note that an employer cannot avoid liability if an employee acts in a way
that could be described as “incidental” to his employment and the duties to which he is entrusted with.

BIBLIOGRAPHY

Websites:

www.wikipedia.com

www.manupatra.com

www.ssconline.com

www.lawteacher.co.uk

Books:

Law of Torts by R. K.Bhangia

Law of Torts by Ratanlal and Dheerajlal

Law of Torts by P.S.A.Pillai