Vicarious Liability in Specific Contexts- Module 3 of 5

Module III: Vicarious Liability in Specific Contexts

Continuing with our discussion of vicarious liability in an employment context, in this module, we will consider whether: (1) federal and state governments can be vicariously liable for employees’ misconduct; (2) hospitals can be vicariously liable for employees’ misconduct; and (3) religious institutions can be vicariously liable for clergy members’ misconduct. Then, we will segue to a non-employment context to consider whether and when restaurant, bar, or tavern owners can be vicariously liable for intoxicated patrons’ misconduct.

Vicarious Liability of the Federal Government

Federal and state governments are generally protected from civil lawsuits by the concept of “sovereign immunity,” and so are therefore not usually liable for their employees’ misconduct. However, there are exceptions to this rule on both the state and federal levels.  

In most circumstances, subject to one important exception, the federal government will not be vicariously liable for an employee’s misconduct. This rule is based on the sovereign immunity doctrine, which is comprised of the following two categories:

·       Absolute immunity. In circumstances where the federal government enjoys absolute immunity, it cannot be sued for employees’ misconduct, even if the employees acted in bad faith or with malice.

·       Qualified immunity. In circumstances where the federal government enjoys qualified immunity, it can only be sued if specific criteria are met. Such criteria are typically set forth in a federal statute or relevant case law.

The exceptions to federal sovereign immunity apply when the federal government consents to being sued, therefore waiving its sovereign immunity.[1] The way the federal government provides consent – and thus subjects itself to vicarious liability – is through the passage of federal statutes that authorize lawsuits for certain types of legal claims. The most important such statute is the Federal Tort Claims Act, which authorizes citizens to sue the federal government for its employees’ misconduct in limited circumstances, and only if that misconduct resulted in actual harm.[2] The government chooses to waive its immunity in this manner, firstly, to allow contractors and service providers to confidently do business with the government and, secondly, to avoid the perceived unfairness that would attend complete government abdication of responsibility for its torts.

Vicarious Liability of State Governments

State governments also enjoy sovereign immunity from civil lawsuits filed in state or federal court. In its own courts, states’ sovereign immunity power largely mirrors the federal government’s immunity. That is, a state may be sued in its own courts and under its own laws only if it waives immunity, usually by virtue of a state torts claims act.[3] Likewise, states cannot be held liable by courts of other states without their consent.

The issue of whether a state can be sued in federal court is a bit more complex. While the “Supremacy Clause” of the Constitution gives supreme authority to the federal government, it does not give the federal government the authority to strip the states of their sovereign immunity in federal court.[4]

Though sovereign immunity is a common law concept, dating back many centuries, in a 1793 case, Chisolm v. Georgia, the Supreme Court interpreted Article III of the Constitution to permit a citizen of South Carolina to sue the State of Georgia in federal court.[5]

First, the Constitution’s structural provisions embrace principles of federalism, de-centralization, and state autonomy, in which states are “semi-autonomous actors that apply their own procedural and jurisdictional rules.”[6] Second, the Eleventh Amendment, which was enacted and ratified in response to the United States Supreme Court’s decision, solidifies the states’ power to invoke sovereign immunity.[7] This amendment provided that the “judicial power of the United States shall not be construed to extend to any suit… commenced or prosecuted against one of the United States by Citizens of another State,” thereby reinforcing states’ rights to sovereign immunity by barring lawsuits against states in federal court.[8]

 In Alden v. Maine, though, the Court clarified that states’ sovereign immunity was not limited or constrained by the text of the Eleventh Amendment.[9] The Court wrote:

Not only do the ratification debates and the events leading to the adoption of the Eleventh Amendment reveal the original understanding of the States' constitutional immunity from suit, they also underscore the importance of sovereign immunity to the founding generation. Simply put, ‘The Constitution never would have been ratified if the States and their courts were to be stripped of their sovereign authority except as expressly provided by the Constitution itself.’[10]

Thus, the federal government cannot compel a state to defend itself in federal or state court and, in most circumstances, prohibits Congress from abrogating states sovereign immunity.[11]

Still, there are exceptions to states sovereign immunity in federal court. The Florida Supreme Court held in Department of Revenue v. Kuhnlein, “sovereign immunity does not exempt the State from a challenge based on violation of the federal or state constitutions, because any other rule self-evidently would make constitutional law subservient to the State's will.”[12] Moreover, Congress may, pursuant to its remedial authority under the Fourteenth Amendment, abrogate states’ sovereign immunity.[13] Therefore, Congress can pass laws prohibiting state actors from discrimination against people based on race, religion, etc., and subject states that do discriminate to federal lawsuits. Finally, although states may invoke sovereign immunity, cities, municipalities, and counties of a state do not enjoy such immunity, and so can be sued in federal court.[14]

          Now let’s consider two examples and examine how these principles are applied.

Example 1

The state legislature in New Jersey enacts a statute stating that “all citizens of the State of New Jersey are prohibited from engaging in speech that criticizes or otherwise undermines the moral authority of government officials.” A New Jersey resident files suit against the state, claiming that the law infringes on the First Amendment right to free speech. In this situation, New Jersey cannot assert sovereign immunity because the resident’s claims allege that New Jersey’s law violates the First Amendment to the United States Constitution. A state or federal court may declare the law to be unconstitutional and may enjoin the state from committing the unconstitutional law. 

Example 2

A new federal law provides a federal cause of action against any state that denies its citizens due process of law. It further states that it is abrogating states’ sovereign immunity. This law is Constitutional and the federal statute will be enforceable. Even though the Eleventh Amendment prevents states from being sued in federal court, here, Congress is using its power to enforce the due process clause of the 14^th Amendment, which is may do, notwithstanding the 11^th Amendment.

A Hospital’s Liability for Employees’ Misconduct

A hospital may be vicariously liable for its employees’ misconduct, including physicians, nurses, and other medical staff that the hospital employs. However, hospitals will typically not be liable for independent contractor’s misconduct.

If courts determine that an agent is a hospital employee, the hospital will be vicariously liable for the employee’s misconduct if such misconduct occurred during the course of employment, namely, while the employee performed a work-related task. For example, a hospital will be vicariously liable if a physician employed by the hospital misdiagnoses a patient’s illness, commits errors during surgery or wrongly prescribes or administers medication.[15]

A hospital can also be vicariously liable for the misconduct of nurses and other staff members. For example, a hospital can be vicariously liable for nurses or staff members that:

·       “Fail to monitor a patient properly”

·       “Fail to take a patient’s vital signs at the proper times”

·       “Forget to take an important vital sign”

·       “Fail to enter the patient’s nursing record into the patient’s chart”

·       “Administer the wrong type of medication”

·       “Administer the wrong amount of medication”

·       “Administer the medication at the wrong time”

·       “Fail to check a bedridden patient for bed sores”

·       “Fail to respond to a patient’s call quickly enough”

·       “Fail to report suspicious symptoms and complaints to the physician in charge.”[16]

Additionally, hospitals can be vicariously liable for negligently hiring or supervising employees or for failing to adequately maintain medical equipment. This includes:

·       Negligently hiring employees, such as failing to verify that health care providers are properly licensed

·       Failing to ensure that its providers stay up to date on licensing requirements and continuing medical education

·       Failing to fire incompetent, unlicensed, or unsafe employees

·       Failing to establish proper patient safety protocols for washing, sanitation, preventing patient falls, patient safety, keeping up with new medical developments and similar things

·       Understaffing medical and/or nursing staff

·       Mislabeling medication

·       Violating patient confidentiality by losing or mishandling patient records.[17]

Let’s consider two examples to examine how these principles are applied.

Example 1

A hospital employs a physician who specializes in complex surgical procedures. One of the physician’s patients is diagnosed with a vascular disease that requires amputation of the patient’s right leg. The physician successfully completes the surgery, but inadvertently amputates the left, not right, leg. The hospital is vicariously liable for the physician’s negligence because the physician was acting within the scope of his employment and performing the tasks for which the physician was hired.[18]

Example 2

A hospital hires a nurse despite knowing that the nurse was previously convicted of assault and battery. Three months later, the nurse kills an elderly patient by administering the patient’s medication at a level of twenty times the prescribed dosage. In this situation, the hospital can be held liable for negligently hiring the nurse, given the hospital’s knowledge that the nurse was previously convicted of assault and battery.

A Religious Institution’s Liability for Clergy Misconduct

In some circumstances, a religious institution may be vicariously liable for the negligence or other wrongful acts of its clergy. A church’s vicarious liability depends on whether the church was negligent in hiring, retaining, or supervising the clergy member. When applying this standard, the following three factors are most relevant:

·       Whether “the employer knew, or should have known, the person was unfit for the job at the time of hiring.”

·       Whether “the employee's incompetence, unfitness, or dangerous characteristics caused an injury.”

·       Whether “there is an employment or agency relationship between the employee and employer.”[19]

As one summary puts it:

Employers may also be liable if they retain employees who commit wrongs against other people if they know, or should know, that the employee does those things. The employer has a duty to protect people from harm from recurring behavior of an employee. Similarly, an employer is liable if he fails to adequately supervise an employee who commits wrongs against other people, and the employer knows, or should know, about this past behavior.[20]

Let’s consider two examples.

Example 1

St. Michael’s is a non-denominational church in New City. Recently, St. Michael’s hired Rev. Timothy Spagnola despite knowing that, twelve years earlier, Rev. Spagnola was arrested and ultimately pled guilty to the crime of driving while under the influence of alcohol. Approximately six months after he is hired, Rev. Spagnola is accused of, and eventually pleads guilty to, theft. St. Michael’s church is probably NOT vicariously liable because Rev. Spagnola’s prior conviction for driving while intoxicated was entirely unrelated to the theft charge.

Example 2

St. Augustine’s is a non-denominational church in New Town. Recently, St. Augustine’s hired Father Steven Michaels, who has been a clergy member for over twenty years, based in substantial part on the stellar references that St. Augustine’s received from priests who supervised Father Michaels for many years at his former church. Unfortunately, one year after Father Michaels was hired, he commits forgery to steal money from congregants. St. Augustine’s is, again, probably NOT liable because it neither had knowledge of nor could have foreseen that Father Michaels would engage in this type of behavior.

Negligent Acts Committed By Intoxicated Bar Patrons

     In many states, the owners of restaurants, bars, and taverns can be liable for serving alcohol to people who later cause injury or death to themselves or others. Known as “dram shop laws,” these laws penalize restaurants, bars, and taverns that negligently serve alcohol to patrons or otherwise fail to supervise the conduct of patrons who are consuming alcoholic beverages. Specifically:

Thirty states have dram shop laws which hold licensed establishments liable for the selling and serving of alcohol to individuals who suffer injury or death, or who cause injury or death of others due to their intoxication. These laws also commonly impose lower thresholds of liability for the selling or serving of alcohol to minors.[21]

Although a restaurant, bar or tavern owner is not vicariously liable under an employment theory sense because patrons are technically not employees, the basic principle of holding owners liable for the acts of those over whom they can exercise control and supervisory authority is the same.  

Restaurant, bar, and tavern owners have been found liable in the following circumstances:

·       Driving While Intoxicated. Owners can be liable if a patron is legally intoxicated and, because of such intoxication, causes injury or death to others while operating a motor vehicle.

·       Accidents on the Premises. If a patron suffers or causes injury to others while on the premises, such as through a physical altercation or falling off a bar stool, the owner may be liable.

·       Failure to provide noticeable exit signs. If an owner fails to provide noticeable exit signs and this failure is a substantial factor in causing injury or death to patrons, such as in the event of a fire, the owner will likely be liable.

·       Underage drinking. If a restaurant owner serves alcohol to someone under the age of twenty-one, the owner can be liable both for providing alcohol to a minor and for any harm that is reasonably foreseeable as a result thereof.[22] A restaurant owner can be liable even if the minor presented fake identification that misrepresented his age.[23]

Now let’s consider two examples to examine how these principles are applied.

Example 1

Matt enters the Heartbreak Saloon in Austin, Texas, is served six beers and three shots of vodka, becoming visibly intoxicated. Shortly thereafter, Matt decides to ride the saloon’s mechanical bull, which is in the back of the bar. While doing so, he is thrown off the bull and suffers two broken ribs and a concussion. Heartbreak Saloon is liable because it was aware (or should have been aware) that Matt was intoxicated and, despite this knowledge, allowed him to engage in an activity that, due to the individual’s intoxicated state, could foreseeably result in injury.

Example 2

The Nostalgia Club is a popular establishment that frequently hosts popular bands from the 1980’s who perform to crowds of approximately 500 people. One evening, the popular 80’s band The Centipedes performs at the club, and while performing, a fire breaks out onstage. The crowd panics and many patrons try to flee the club, but two of the three exit doors are obstructed by the stage and not viewable by many of the attendees. As a result, everyone rushes toward the one visible exit sign that is located near the front of the club. In so doing, however, several people are trampled by the crowd and suffer fatal injuries. The Nostalgia Club is liable because it did not exercise reasonable care to ensure that its patrons could access all available exits. As such, the fatalities were a reasonably foreseeable result of this failure.[24]

Conclusion

          Courts apply the vicarious liability doctrine to different types of employer-employee relationships and, in some circumstances, apply this doctrine where no formal employer-employee relationship exists, such as in the case of restaurant, bar, or tavern owners. The primary factors courts consider when applying the vicarious liability doctrine to hospitals and churches is whether the employer (or owner) was negligent in hiring or retaining the employee or failed to exercise adequate supervision. When applied to restaurant, bar, or tavern owners, the relevant question is whether the owner failed to adequately supervise patrons and otherwise take reasonable steps to prevent patrons from engaging in negligent conduct.

In the next module, we will apply the vicarious liability doctrine to relationships among private individuals.