Vicarious Liability

VICARIOUS LIABILITY

David A. Beyer, Esq.

Published By DLA Piper US LLP 101 East Kennedy Boulevard Suite 2000 Tampa, Florida 33602 (813) 222-5911

© 2006, DLA Piper US LLP

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I. A.

VICARIOUS AND DERIVATIVE LIABILITY INTRODUCTION. 1. 2. 3. 4. Actual Agency. Apparent Agency. Direct Liability Assumption of Liability

B.

TORT LIABILITY. 1. 2. 3. 4. 5. Fraud Cases Negligence Products Liability Personal Injury - Wrongful Death Direct Negligence

C.

AVOIDING APPEARANCE OF CONTROL OF DAY TO DAY OPERATIONS,

EMPLOYEE RELATIONS, ETC.

D. E.

EMPLOYMENT CASES CONSUMER CLAIMS 1. 2. 3. Americans With Disabilities Act Facilities Case Civil Rights Claims Miscellaneous

F. G. H. I.

ENVIRONMENTAL LIABILITY CRIMINAL CONDUCT TAXES CONCLUSION

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VICARIOUS LIABILITY

One of the many advantages of franchising is the shifting of legal and operational risk to the operator of the franchised business – the franchisee. With the continuing growth of franchising coupled with the never-ending search for “deeper pockets,” franchisors are increasingly becoming defendants in lawsuits by third parties. In these lawsuits, various plaintiffs attempt to impose liability on the franchisor for the acts or omissions of their franchisees (or their franchisees’ employees) or due to events occurring on the premises of the franchised business. This process – where a franchisor is potentially liable for the damages caused by someone else – is known as vicarious liability. I. INTRODUCTION. Vicarious liability is the principle of law that holds one party liable for the acts (or inactions) of another. The franchise relationship generates vicarious liability claims because of the common use of the trademark coupled with quality controls and system standards designed to protect the goodwill associated with the trademark. Product distribution franchises generally face less risk of vicarious liability, at least outside of products liability...