Business Law

Running head: BUSINESS LAW
Business Law
Name of the Student
Name of the University
Author Note

1BUSINESS LAW
Question 1
Issue
Whether any vicarious liability will be incurred by the employer for the loss sustained by
Mr. William for the act committed by Mr. Lee. Additionally, the relationships that are necessary
to create vicarious liability are to be determine.
Rule
Vicarious Liability implies a liability incurred by an employer by the acts or omissions of
an employee, which causes distress to a third party in the course or furtherance of his
employment. Another employee may also imply a third party (Luntz et al. 2017). The same can
be illustrated with the case of Meyer v. Holley, 537 U.S. 280 (2003). To come under the purview
of Vicarious Liability, two requirements are needed to be fulfilled. Firstly, there must be an act
or omission committed by the employee causing harm or damage to a third party. Secondly, the
act or omission committed by the employee must be in the course or furtherance of his
employment. Hence, an employer-employee relationship must exist and the act must be
committed in pursuance of or in connection with the employment.
An Employer-Employee relationship or Principal-Agent relationship is necessary to
establish vicarious liability where the person committing the wrongful or negligent act is under
the control of the person incurring the liability. It assumed that employee is acting on behalf of
the employer.

2BUSINESS LAW
Application
In this present case both Mr. Williams and Mr. Lee are employees of the same employer.
Apart from being colleagues, they were also engaged in friendly relationship with each other.
The spraying of thinning agent on Mr. Williams overalls was a reckless act of Mr. Lee. Although
an inflammable thinning agent was easily accessible to Mr. Lee for his being an employee in the
bodywork mechanic shop, but spraying it on Mr. Williams overalls and setting the said overall
on fire was not in pursuance of his employment. It was an act outside the scope of and remote to
his employment.
Conclusion
Therefore, the employer will not be held vicariously liable for the acts of Mr. Lee causing
loss to Mr. William. The relationship that creates vicarious liability have been discussed above.