Meaning: liability of one person for the wrong of another due to their relationship. Latin maxims: qui facit per alium facit per se (he who acts through another acts himself) and respondeat superior (let the master answer).
Master and servant
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A master is liable for torts committed by the servant in the course of employment.
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Tests of a servant: control test, organisation/integration test, multiple/economic reality test. A servant is under control as to how work is done; an independent contractor only as to what is done.
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Course of employment: acts authorised, or unauthorised mode of doing an authorised act (Limpus v London General Omnibus Co, driver racing to obstruct a rival bus; master liable). A prohibited act (not merely prohibited mode) is outside employment (Conway v Wimpey, driver giving lift against orders; Twine v Beans Express). But Rose v Plenty (milk float boy; master liable because the act was for the master's business despite prohibition).
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Acts of fraud/crime: Lloyd v Grace, Smith & Co (solicitor's managing clerk defrauded client; firm liable); Century Insurance v Northern Ireland Road Transport Board (tanker driver's smoking during petrol delivery; liable); Poland v Parr (force in defence of master's property). In modern English law the test is a close connection with the employment (Lister v Hesley Hall, 2001; Various Claimants v Catholic Child Welfare Society; Mohamud v Morrisons).
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Loaned servants: Mersey Docks and Harbour Board v Coggins & Griffith — liability lies with the person having control at the time.
Other relationships
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Principal and agent: principal liable for agent's torts within authority.
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Partners: liable jointly and severally for torts committed in the course of firm's business (Section 26–27, Indian Partnership Act 1932).
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Independent contractor: employer generally not liable, with exceptions: negligence in selecting contractor; non-delegable duties (e.g., hazardous operations, duty to maintain highway, strict liability torts); employer authorising the wrongful act; ultra-hazardous work (Bower v Peate).
Indian illustrations: State of Rajasthan v Vidhyawati (vicarious liability of the State for the negligent driving of a government driver); Saheli v Commissioner of Police; Municipal Corporation of Delhi v Subhagwanti.
Rationale (memory): (i) deep pocket / better ability to pay, (ii) control over employee, (iii) the master benefits from the employee's work, (iv) deterrence and risk distribution through insurance.