Chapter 16Employing labour(b)Where the employer’s instruction relates only to the way
in which the contractual duty is to be done. Obviously,
perhaps, an employer cannot avoid liability by saying
to his employees: ‘Do your job in such a way as not to
injure anyone.’
5 Employee’s criminal acts.An employer may even be
vicariously liable for a criminal act by his employee. The
criminal act may be regarded as in the course of employ-
ment so that the employer will be liable at civil law for
any loss or damage caused by the employee’s criminal act.497
milkman, to deliver the milk. Cooperative Retail Services
Ltd, who employed Mr Plenty, expressly forbade their
milkmen to take boys on their floats or to get boys to
help them deliver the milk. On one occasion, while help-
ing Mr Plenty, Leslie was sitting in the front of the float
when his leg caught under the wheel. The accident was
caused partly by Mr Plenty’s negligence. The court
decided that Mr Plenty had been acting in the course of
his employment so that his employers were liable to
compensate Leslie Rose for his injuries. There is really
quite a difference in the facts of this case and those in
Rand. Leslie Rose’s presence on the milk float was con-
nected with the delivery of the milk which was a reason
connected with the employment and this seems to be
why the court decided as it did.Limpusv London General Omnibus
Co(1862)
The claimant’s bus was overturned when the driver of
the defendants’ bus drove across it so as to be first at a
bus stop to take all the passengers who were waiting.
The defendants’ driver admitted that the act was inten-
tional and arose out of bad feeling between the two
drivers. The defendants had issued strict instructions
to their drivers that they were not to obstruct other
omnibuses. The court decided that the defendants were
liable. Their driver was acting within the scope of his
employment at the time of the collision, and it did not
matter that the defendants had expressly forbidden him
to act as he did.4 Employee’s fraudulent acts.At first the courts would
not make an employer liable for the fraudulent acts of
his employee. Gradually, however, they began to accept
that the employer could be liable, first in cases where the
employee’s fraud was committed for the employer’s
benefit, and later even in cases where the fraud was car-
ried out by the employee entirely for his own ends, as
the following case shows.
Lloydv Grace, Smith & Co(1912)Smith was a Liverpool solicitor and Lloyd was a widow
who owned two properties at Ellesmere Port and had
also lent money on mortgage. She was not satisfied
with the income from these investments and she went to
see Smith’s managing clerk, Sandles, for advice. He told
her to sell the properties and call in the mortgages, and
reinvest the proceeds. At his request she signed two
deeds which, unknown to her, transferred the properties
and the mortgage to him. Sandles then mortgaged the
properties and transferred the other mortgages for
money and paid a private debt with the proceeds. The
court decided that the firm of solicitors was vicariously
liable for Sandles’ fraudulent acts. An employer could be
vicariously liable for a tort committed by an employee
entirely for his own ends.
Comment.
(i)This decision seems to contain at least some public
policy and to be based on the principle that, since some-
one must be the loser by reason of the fraud of the
employee, it is more reasonable that the employer who
engages and puts trust and confidence in the fraudulent
employee should be the loser rather than an outsider.
(ii)Where the basis of a particular decision is public
policy then circumstances can alter cases. When, as
distinct from a ‘consumer’ situation as seen in the above
case, the scenario is business the court may reach the
conclusion that the act is within the course of employ-
ment but the fraud is not so that the employer is not
liable for it. This was the attitude taken by the Court of
Appeal in Generale Bank Nederland NVvExport Credits
Guarantee Department(1997) where an employee of
the Department had assisted in a fraudulent operation to
obtain export guarantees which caused loss to the bank.
The Department was not liable.Morrisv C W Martin & Sons Ltd(1965)The claimant sent a mink stole to a furrier for the purpose
of cleaning. With the claimant’s consent the furrier gave
it to the defendants to clean. While it was in the posses-
sion of the defendants the fur was stolen by a person