Kraakman, Reinier H. --- "Vicarious and Corporate Civil Liability" [2009] ELECD 291; in Faure, Michael (ed), "Tort Law and Economics" (Edward Elgar Publishing, 2009)

Book Title: Tort Law and Economics

Editor(s): Faure, Michael

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781847206596

Section: Chapter 5

Section Title: Vicarious and Corporate Civil Liability

Author(s): Kraakman, Reinier H.

Number of pages: 17

Extract:

5 Vicarious and corporate civil liability
Reinier H. Kraakman*


5.1 Introduction
`Vicarious liability' is the absolute liability of one party ­ generally the
legal `principal' ­ for misconduct of another party ­ her `agent' ­ the actor
whose activities she directs. As such, traditional vicarious liability is a form
of strict secondary liability, in contrast to secondary liability imposed on
principals or other parties under a duty-based standard such as negligence.
In the common law, the legal doctrine of respondeat superior is the principal
vehicle for holding principals liable for the torts and other delicts of their
agents. Under this doctrine, principals are jointly and severally liable for
the wrongs committed within the `scope of employment' by agents whose
behavior they have the legal right to control (`servants'). For the US, see
Restatement (Second) of Agency, §§ 2, 219 (1958), 220, 229; and Restatement
(Third) of Agency, § 7.07 (2006). Not only is English law similar (Rogers,
2002), but most Civil Code jurisdictions have inherited an almost identical
rule of vicarious liability for torts from article 1384 (subsection 3) of the
Napoleonic Code Civil of 1804. See generally, Spier (2002).
Thus, most corporate liability for torts, and in the United States for
corporate crimes as well, is vicarious liability imposed under respondeat
superior or its civil law analogues. To be sure, corporate liability may also
be direct, as when the independent actions of several corporate agents
cumulatively result in a business tort, although no single agent is individu-
ally culpable. But even in ...