Recently, I had the pleasure of teaching “Introduction to Small Claims Court” to a group of magistrates who turned out to be actors in disguise. The course culminated in a series of mock trials involving summary ejectment, breach of contract, recovery of personal property, conversion, and negligence. While the mock trials provided an entertaining way to review small claims procedure and the substantive law, the negligence case raised some interesting questions on vicarious liability.

In the mock trial, a customer sued a garden center and a garden center employee for injuries sustained as a result of the employee running the cart into the customer’s leg. The employee was on his phone when he was supposed to be paying attention to the moving cart. The customer had type 2 diabetes and also took blood thinners. The injury required an ambulance ride to the hospital for stitches. The customer sought compensation for his medical expenses and his pain and suffering.

Vicarious Liability

Generally, individuals are liable for the injuries caused by their own negligence; and third parties are not liable unless vicarious liability applies. Vicarious liability is based on the third party’s relationship to the individual who allegedly caused the harm rather than the third party’s own wrongdoing. In the employer/employee context, vicarious liability in an action for negligence arises under the theory of respondeat superior which requires the plaintiff to show the following:

1. That the plaintiff (here the customer) was injured by the negligence of the alleged wrongdoer.
2. That an employer/employee relationship existed between the party that the plaintiff seeks to hold liable for the harm (here the garden center) and the party who allegedly caused the harm (here the employee).
3. That the neglect of the employee was done in the course of his employment or within the scope of his authority as an employee.
4. That the employee was engaged in the work of the employer and was going about the business of his employer at the time of the injury.

Estes v. Comstock Homebuilding Companies, Inc., 195 N.C. App. 536 (2009).

The employer’s liability will often hinge on whether the employee’s negligence occurred while the employee was acting within the scope of his or her employment. Courts may vary on the degree to which the employee’s deviation from the course and scope of his employment is sufficient to relieve the employer of liability. Contrast the following cases:

• Tomlinson v. Sharpe, 226 N.C. 177 (1946)-Sharpe employed drivers to transport a load of poultry, and while en route, the truck broke down, blocking the highway. Tomlinson’s drivers were forced to stop their truck on the highway. Sharpe’s drivers approached Tomlinson’s truck and asked if they could get in the cab to keep warm. One of Tomlinson’s drivers warned Sharpe’s drivers not to light a cigarette because the gas tank had leaked, and the floor mat was soaked with gas. One of Sharpe’s drivers, ignoring the directive, lit a match and threw it down on the floor, setting fire to Tomlinson’s truck. The supreme court agreed with Sharpe that, as the drivers’ employer, Sharpe should not be liable for the employees that caused the fire where the employees were neither on the premises of their employer nor using an instrumentality of their employer to perform their duties when the negligence occurred.
• Estes v. Comstock Homebuilding Companies, Inc., 195 N.C. App. 536 (2009)-Comstock leased a home owned by Estes to use as a model home for a subdivision. Haskell, a sales assistant employed by Comstock, was working alone at the model home. Haskell stepped onto the deck to smoke a cigarette but failed to completely extinguish it when she went inside to answer a ringing telephone. Comstock argued that Haskell was not acting within the scope of her employment when she stepped outside to take a smoke break as it was not in furtherance of her duty to her employer but was for personal enjoyment. The court of appeals disagreed with Comstock and pointed to two key factors: 1) Haskell was on the premises of her employer where she was required to be; able and willing to perform her duties; and 2) the negligence occurred when she went to perform one of those duties: answering the telephone.
• Duckworth v. Metcalf, 268 N.C. 340 (1966)-Courtney, an employee of Metcalf, was driving a car owned by Metcalf when he made a dangerous passing maneuver that resulted in an accident. Duckworth, a passenger in the car driven by Courtney, was injured as a result of the wreck. Courtney admitted that he was supposed to take another employee home and return Metcalf’s car within an hour. Instead, Courtney decided to take a six-hour pleasure cruise. The supreme court agreed with Metcalf that he was entitled to a jury instruction relieving him of liability if the jury found that Courtney was on a mission of his own. The court pointed to the principle that an employer is not liable for injury due to a negligent act of an employee when the employee has departed from the course of his employment and embarked upon a mission or frolic of his own.

Returning to the mock trial scenario, the employee was on the premises of his employer, using a garden cart provided by his employer, and carrying out a duty of his employment by assisting a customer in placing plants on the cart. The employee likely breached his duty of care to the customer when he was distracted by his phone from safely maneuvering the cart. That breach was the cause of the customer’s injury, and the customer was damaged by the employee’s negligence. The doctrine of respondeat superior would likely apply to hold the employer liable for the negligent actions of its employee.

Limitations on Liability

Since this is a negligence case, the employee and the employer can attempt to raise the defense of contributory negligence. For example, if the customer testifies that he noticed the cart was coming towards him and could have moved out of the way, his failure to remove himself from the position of peril may constitute contributory negligence-a complete bar to the customer’s recovery. See, e.g., Wyrick v. K-Mart Apparel Fashions Corp., 93 N.C. App. 508 (1989) (affirming summary judgment for store owner where customer tripped on a garden hose because she walked over rather than around it). The customer may overcome the defense of contributory negligence by showing that it was the employee who had the last clear chance to avoid the accident. See, e.g., Exum v. Boyles, 272 N.C. 567 (1968) (holding plaintiff was entitled to a jury instruction on the doctrine of last clear chance where evidence showed that although plaintiff placed himself in a perilous position, defendant knew or should have known about plaintiff’s peril, and defendant had the time and ability to avoid the harm but failed to do so).

It is important to remember that if the case against the wrongdoer (the employee) is dismissed, then the case against the employer goes away if it is based solely on the theory of vicarious liability. If the employer is being sued for their own negligence, such as negligent supervision or negligent hiring and retention of the employee, those claims are not based on respondeat superior. In actions against the employer for negligent supervision or negligent hiring and retention, the employer has primary (direct) rather than vicarious liability. See, e.g., Keith v. Health-Pro Home Care Services, Inc., 381 N.C. 442 (2022) (establishing the elements a plaintiff must prove to hold an employer liable for negligently hiring, retaining, or supervising an employee).

If the case against the employer is based on vicarious liability, then the employer’s liability is limited to the wrongdoer’s liability for compensatory damages. Pinnix v. Griffin, 221 N.C. 348 (1942). This rule about compensatory damages does not apply to punitive damages where the employer ratified the employee’s wrongdoing. Watson v. Dixon, 352 N.C. 343 (2000). Punitive damages are intended to punish the defendant and deter others. Id. Since punitive and compensatory damages serve different purposes, it may require a different amount of money to punish or deter the employer than the employee. Id. It is rare in small claims that punitive damages will be awarded because doing so requires proof of wanton, reckless, malicious, or oppressive conduct, beyond ordinary negligence.

Final Thoughts

Because employers exercise control over their employees, it follows that they may find themselves liable when an employee acts negligently while about the employer’s business. Judicial officials will sometimes be tasked with determining if an employee’s negligence occurred within the scope of his employment or during a frolic or detour from his job duties. Understanding how the doctrine of vicarious liability is applied in the employer/employee context is crucial to adequately compensating plaintiffs injured by an employee acting within the scope of his employment. Conversely, correctly applying the doctrine may sometimes relieve an employer from liability where the employee is not acting within the scope of his employment.