Employment, Vicarious Liability and Occupier's Duty

The assignment content discusses two legal concepts: vicarious liability and occupier's duty to take care of visitors. Vicarious liability refers to a situation where an employer is held responsible for the actions of their employee that are committed during the course of employment, as long as the act is authorized by the employer or closely related to the employment. The court applies the test of proximity to employment to determine whether the employer is liable. However, if the employee commits an independent act beyond their duties, the employer may not be held responsible. In contrast, if an independent contractor commits a negligent act, the employer may not be held liable. The second concept discusses an occupier's duty to take care of visitors. An occupier has a responsibility towards ensuring the safety of visitors on their premises and must take steps to maintain the structure in a reasonably safe condition, warn visitors of dangers, and prevent them from entering areas of danger.

REPORT: XYZ, ANDREWS & HOPKINS
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TASK-1
1.1 Explain the importance of the essential elements required for the formation
of a valid contract
1. Agreement 2. Contractual Intention 3. Consideration 4. Capacity and 5. Certainty
Agreement: a valid agreement requires offer and acceptance, a valid consideration
and intention to create a contract
Offer and Acceptance-an offer is an expression to show the willingness of the person
to create a legal relation. Acceptance on the other hand, is an expression of assent
to the offer that leads to the formation of an agreement.
In this regard, an offer must be distinguished from the invitation to treat to the extent
that the person communicating is not making an offer but is invites the person to do
so. Such is the case with advertisements as explained in Scenario no 1. Here, Bill
by placing an Advertisement makes an invitation to treat, inviting people to make an
offer. On the other hand, Bill by communicating to Liza specifically the sale of the
office computer for £ 550 is making a concrete offer for sale.
Consideration
The common law principle of quid pro quo explains the consideration, where
something of value has to be made for the fructification of contract.
Intention to create a contract
The parties to the contract have to have an intention to create legal consequences.
Both the parties to the contract should have a clear conscious intention to make a
valid contract with the other party to the contract. (P. S. Atiyah 2005)
Capacity to the contract
Persons entering contract have to be legally capable to create a legal relationship.
They have to act without duress or coercion, and give free consent to create a
contract.
Certainty
The terms of agreement have to be certain and not based on vague terms which can
invalidate the agreement.
1.2 Discuss the main types of contracts and their impact in UK

Unilateral Contract-Where one party makes a promise to perform without any
reciprocation from the other party.
Bilateral Contract-When the offerors makes a promise in return for the promise by
the offeree.
Express Contract- where the contract terms and conditions are written and clearly
emphasized. Such contracts include signatures to avoid any complications.
Implied Contracts-where the responsibilities and the terms and conditions arising
from an agreement are not expressed in writing as the person making it, but by the
intention of the person making it.
Standard Contract-where the terms are well documented, represented by parties or
their representatives, sealed and signed
Void and voidable contract- A void contract cannot be enforced by either party. In
other words, it is void ab initio as the law treats it to have never been formed.
A voidable contract is a valid contract which cannot be enforced as usually only one
party is bound by the terms of the contract.
2.1
In the above case of Bill and Cathy, the advertisement amounts to invitation to treat,
thereby make an offer to the general public to make an offer. Cathy by making a
counter offer to buy the printing press for £80,000 has made an offer subject to the
acceptance of Bill. Bill by agreeing to the earlier amount stated by Liza has shown
his acceptance to the offer made.
In the case of Bill and Liza, there is no valid contract that exists. In the first instance
when Liza posted a letter to Bill, it showed her willingness to accept the offer made.
Going by the “postal rule”, the acceptance is deemed to have been communicated
the moment she has posted the letter. In between the gap between the day of
posting and the letter being received by the proposer, was used by Liza to withdraw
the acceptance made by speedier mode of communication. Hence, the revocation
notice has been received by Bill before he received the letter of acceptance.
Doctrine of Promissory Estoppel
The doctrine of Promissory estoppel’ is based on the common law of equity which
prevents a person from going back on the promise made or forgo strict contractual
rights. (David Kelly 2014)Hence, where one party promises to perform and the other
party relying on such a promise suffered significant detriment, he can claim for relief
by way of making the promissor fulfil the promise.

Task 2-SHORT ANSWERS
Analyze the terms in the contracts with of contract and its impact
Conditions:
A condition is the backbone of any contract, the breach of which can result in
substantial loss to the claimants. In the case no. 1 Joyce entered into the contract for
a period of three months. Having fallen ill four days before the opening day, she has
committed breach of contract and the act of Royal Albert Company in replacing her
was a valid one. The decision has been held in Poussard vs. spiers [1876], where
claimant having fallen ill missed the opening show. The court held that there was
breach of condition as she missed the opening night and the most important
performance.
Warranty: is an term which gives the parties the right to claim damages to a
particular extent, in cases where some problem arises in the product.
Implied and Express Terms:
Implied terms are terms wherein the parties have not mentioned the terms clearly,
lucidly or expressly, and Express terms are wherein the terms are laid down clearly
by the parties
Effect of Express and implied terms
The effect of the implied terms is that often the parties have to imply and make a
commercial sense of the contract. In the above case wherein the claimant farmer
was refused the payment towards the cost incurred for seeds, etc. was under implied
terms with his landlord. The decision in Hutton v Warren [1836], is on the similar
lines where the court held that the terms are implied by its usage and custom and
hence the ruling was given in favor of the farmer tenant.
On the other hand, express terms are the terms which are laid down by the parties to
the contract with an intention that they are integrated in the contract, thus making the
parties binding into the contract. In this case between Scammell and Ouston, the
parties had laid down express terms wherein Scammel supplied a van for £286 and
Ouston was to trade his old van for £100. The contract having not fructified, the
parties will have to suffer the loss due to Scammel not supplying the van.
Task 2-SHORT ANSWERS ON EXCLUSION CLAUSE
Scenario B
Validity of Exclusion clause
In the above case, the City Car Rental can be held liable for the injury caused. The
Limited liability being the exclusion clause was not the part contract viz., signed

document and was introduced after the conclusion of the contract. In Olley v
Marlborough Court Ltd.,[1949] the court held that the notification of terms was not
apparent until the contract was concluded and that the exemption clause was not a
part of the contract that could protect the hotel.
Evaluation of statement on exclusion clause
D1An exemption clause is included in an agreement in order to avoid or limit the
liability of a party for the breach of contract or negligence. Such exclusion clauses
are valid so long as it has been incorporated in the contract, extends to the loss in
question and has been held valid under the unfair contract terms Act of 1977 and
unfair terms in consumer contracts regulations 1999.
However, such clauses have little or no effect if incorporated after the contract is
entered into by the parties. In the case of Chappelton v Barry UDC [1949] (Douglas
Wood 2011), the claimant injured himself when the hired deckchair collapsed on him.
There was no notice of the exclusion clause that was given at the time of hiring it.
The clause was incorporated in the receipt given to the claimant. It was held that
such incorporation of exclusion clause in the receipt was unreasonable as the
agreement was already entered into by the parties to the contract. The exclusion
clause will therefore be of no effect if the contract is already entered into by the
parties.
TASK THREE
4.1 Writing of letter to Brad to recover losses
November 05,2016
AXN Partners
P.O. Box 65,
London
Dear Mr. Brad,
With reference to the contract agreement entered into between you and Charles vide
Agreement dated 02-02-2016, I wish to bring it to your kind notice that there have
been financial irregularities due to which you have suffered losses and damages. We
concede with the fact that there has been pure economic loss in this case due to the
negligent misstatement on the part of Adrian as it was his duty to check the financial
condition of Charles before giving you advice. Wherefore, we advise you to take
following steps and prevent further losses
I hereby advice you that you may choose to bring about an action for specific
performance to pay up the arrears of rent as well as vacate the house with

immediate effect. Alternatively, a suit for damages can be brought about against
Charles along with a suit for injunction preventing him from using the premises.
Having said this, I would like to draw your attention to Hedley Bryme & Co Ltd v
Heller & Partners Ltd [1964] where the courts held that the relationship between the
parties was sufficiently proximate so as to create a duty of care. The defendants
therefore had to take sufficient care in giving advice to avoid negligence liability
Yours sincerely,
Signed
3.1 Contrast between nature of liability in tort and liability in contract
 In a contract law, obligations are voluntarily entered into between the parties
whereas in tort, they are imposed by law
 Person entering into a contract owes a duty to the party to the contract,
whereas in a tort, there is a duty owed towards the individuals, the property
and people affected by our acts and omissions
 The duty of care owed in case of contractual liability is towards the other party
only; whereas, in case of liability in tort, parties owe a duty of care towards all
those who are even remotely affected by their actions. Eg: strict liability,
trespass, negligence etc.
 In a contract law, the liability of the parties occur due to the fact that the
parties enter into an agreement by mutual consent and after fulfilling the basic
elements of a valid contract. However, in a tort, liability occurs without any
consent.
3.2 Nature of liability in Donoghue v Stevenson detailing conditions to prove
negligence
The case of Donoghue v Stevenson [1932] establishes a rule where in the
manufacturers ought to take duty of care towards their customers. The plaintiff in this
case found a snail in the bottle of ginger beer, after consuming which she was
diagnosed of gastroenteritis. The court found that the manufacturer had breached a
duty of care towards his customers and had caused injury due to his negligence.
Since the manufacturer here knew that the product is meant for consumption owed a
duty of care that no noxious element is present in the article. Secondly, the case also
lays down the duty of care towards neighbors which includes those people who are
likely to be directly affected by the acts of the defendant. The following are the
conditions required to prove negligence:
Duty of care: it is necessary to establish that the defendant had not taken reasonable
care and caution to avert danger in the property.

Reasonable foreseeability: that the defendant has failed to forsee the damage
caused due to the act of the plaintiff.
Neglect of duty: that the defendant had neglected his duty by not ensuring that the
product is suitable for use/consumption.
M2 Meaning of strict liability in tort Rylands v Fletcher
The doctrine of strict liability is applicable in cases where the wrongdoer is liable for
the acts for which he is not directly responsible. The plaintiff needs to prove that the
act is caused due defendant’s lack of care and caution to avert the reasonably
foreseeable dangerous consequences of acts or omissions.
The case of Rylands v Fletcher laid down an important element for determining
nuisance, wherein a person who has suffered damage due to the negligence of the
defendant, can be compensated for such act or omission. The rule imposes strict
liability for the escape of dangerous substances which have been brought, stored
and accumulated which cannot be regarded as the “ natural user of land” (Sue
Elworthy 1997)The strict liability imposes a rule that the defendant reasonably ought
to have forseen that collection and storage of nuisance can cause damage of
relevant kind.
TASK FOUR
1. XYZ Diaries can be held vicariously liable for the accident caused due to Bill’s
negligent driving. While XYZ diaries knew very well that Bill had hired the services of
the teenage boy, they had not done anything about it.
2. In this case the vintage vehicles museum owner is liable for the act of his friend,
for the reason that the owner has employed him to carry out the activities on his
behalf and during the course of the execution of duties. By delegating his duties the
owner not only has a duty to take care of the person to whom the work is delegated,
but also ensure that the contractor takes due care in discharging his duties.
4.2 Applying the rule of respondeat superior to the present case, XYZ is vicariously
liable for the acts committed by Bill. Although the rule is not applicable if an
employee engages in conduct prohibited by the employer, he remains liable so long
as the activities are committed during the course of employment. An employer
retains liability if an employee hires an independent contractor to carry out activities
that involve risks requiring more than ordinary precautions. (Edwards 2016)
3.3 Extent to which the businesses are vicariously liablefor the ‘wrongs’ of its
employee
The principle of vicarious liability binds the principal with the agent, thereby imposing
the responsibility of the employers towards the wrongs committed by the employees.
The fiduciary principle of “respondeat superior” makes the employers vicariously

liable for the negligent acts and omissions by the employees during the “course of
employment”. (F.L. Memo 2005) In order to establish whether an act is committed
during the course of employment, it is necessary to establish that the act is
authorized by the employer or closely related to the employment. In the case of
Mohamud v WM Morrison Supermarket, [2016] an action was brought against an
employee, Mr. Khan, for abusing and indulging in violent activities against the
plaintiff. The court held that although Mr. Khan’s duties involved interaction with
customers, there was neither a clear possibility of confrontation, nor was he placed
in a situation where the outbreak of violence was likely. The defendant was therefore
not held vicariously liable since Mr. Khan had committed an unlawful act beyond his
duties. However, the Supreme court reversed the order passed by the lower court
and applied the test of proximity to employment, thereby stating that even if the
employee is remotely connected to employment, the employers can be held
responsible.
For example: if an employee injures a pedestrian while driving a van for the delivery
of company’s goods, will make the employer liable for damages to the injured
person.
In contrast to this established principle where an independent contractor commits a
negligent act, the employer may not be held responsible. This was explained in the
case of Honeywell & Stein Ltd v Larkin Bros Ltd[1934] where an employer is not
liable for the acts of independent contractors in the same way as he is for the acts of
his employees or agents. The doctrine is not applicable in the following cases
 where the employee acted out of his own will,
 for illegal acts or
 in cases where he has acted outside the scope of his employment, or by an
independent contractor
D3- Occupier’s duty to take care of visitors
The Occupier of a premises has responsibility towards the control over the condition
of premises and has a duty to “take such care as in the circumstances of the case is
reasonable to see that the visitor will be reasonably safe in using the premises”
Section 2(1) of the Occupier’s liability Act, 1957 states that an occupier of premises
owes the same ‘common duty of care to all the visitors’. Some of the steps that the
occupier of premises takes to ensure the safety of the visitors are:
 the occupier has a duty to maintain the structure in a reasonably safe
condition
 the occupier must take steps to warn the visitors of the dangers in the
premises
 the occupier must take steps to prevent visitors from coming into the areas of
danger (Hodge 2004)

 Special attention to safety measures by way of installing warning signs etc.,
for visitors who are old aged, children and individuals requiring special care.
 Installing warning board averting danger in the premises
However, if the visitor exceeds the occupier's permission, such as by going into a
part of the premises where he was told by the occupier not to go, he will become a
trespasser, where the owner will no longer have a duty under the 1957 Act, but may
be afforded lesser protection under the 1984 Act. Section 2(5) provides that the
occupier will not be liable where the risks are willingly accepted by his visitor. In the
case of Roles v Nathan, the occupier was not held liable for the deaths caused due
to asphyxiation carried out due to repairs in a boiler room when the boiler was alight.
Since the workers had knowledge and experience in this kind of work, they should
have put off the boiler before starting work.
REFERENCES
Mohamud v WM Morrison Supermarket[2016] UKSC 11
Honeywell & Stein Ltd v Larkin Bros Ltd [1934] 1 KB 191
Donoghue v Stevenson[1932]UKHL100
Hedley Bryme & Co Ltd v Heller & Partners Ltd [1964] AC 465
Poussard vs. spiers [1876], 1 QBD 138
Hutton v Warren[1836],1 m&w O6
David Kelly, RHJH 2014, Business Law, Rouledge Patrick and Taylor Group, New York.
Douglas Wood, PCJAJM 2011, Law & the Built Environment, Wiley Blackwell, Chichester, West
Sussex, United Kingdom.
Edwards, JS 2016, Tort Law, Sixth Edition edn, Dengage Learning, Boston.
F.L. Memo 2005, Employment 2006: Law and Practice, Human Resources, FL Memo Ltd, London.
Hodge, S 2004, Tort Law, 3rd edn, Rouledge Taylor and Francis Group, New York.
P. S. Atiyah, SAS 2005, An Introduction to the Law of Contract, Sixth Edition edn, Clarendon Press.
Sue Elworthy, JH 1997, Environmental Protection: Text and Materials, Butterworths, Dublin.