Vicarious Liability

respondeat superior: 

"let the master answer"

• Business IS liable IF the employee was acting within the SCOPE of business

Intentional Tort

(definition)

 1) Who writes torts?

2) do they always stay constant?

 1) judges

2) no, they change often

•  entitled to the victim of a tort
• intended to punish the tortfeasor and further compensate the victim

 Battery

 How is someone liable for battery?

 Assault

 Intentional Infliction of Emotional Distress

(definition)

 behavior that unjustifiably upsets the victim

• must be outrageous
• plaintiff must actually suffer emotional distress

4 elements that are required for intentional infliction of emotioinal distress

1) actor INTENDS to inflict distress

2) "extreme" / "outrageous" behavior

3) defendants actions are the CAUSE of plaintiff's distress

4) emotional distress suffered was SEVERE

 What happens if BOTH PARTIES are INNOCENT 

(torts)

liability SHIFTS to the party that can SHIFT/ABSORB 

the most damage

(ex. to a company because they can just increase prices to make up for the loss)

 Defamation

 Damage to someone's reputaiton

1) libel

2) slander

 1) tortfeasor made defamatory comment

2) tortfeasor intended to communicate it

3) identifies victim to a reasonable reader

4) communicated to a third-party

5) plaintiff's reputation was actually damaged

 Statements that are clearly defamatory are PRESUMED to cause damage

When is someone authorized to use defamation?

if it serves the public interest

ex) past employer's comments to a future employer

 Deceit

1) false representation of a known fact

2) knowledge by the defendant that the fact is true

3) intent to induce the listener to rely on the info

4) justifiable reliance on the information

5) actual damage was taken by the plaintiff

 Requirements of invasion of privacy

 1) right to control information

2) invasion is objectionable to a reasonable person

 "intrusion into seclusion"

 "stereotypical" invasion of privacy

ex) peering into someone's home

 "Public disclosure of private facts"

 "false light"

(similar to defamation, but broader)

**the statement doesn't need to be defamatory, but it just has to be FALSE

 "appropriation"

Disparagement

 False statements that injure a person's interests

ex) "john is out of business" when he actually isn't

falsely represnting goods to decieve the buyer into thinking that they are a competitor's product

ex) fake Gucci bags

Interferance with contract

1) tresspass to personal property

2) trespass to real property

Unlawful interferance with another's land

** dumping pollutants onto another's land counts

Nuissance

 When do courts deem something as a nuisance?

 1) Consent: (must be reasonable)

2) Privelage: (is lost if the defendant acts in bad faith)

How do you consent to a contract without becoming liable?

Sign the contract "under protest"

Just write "under protest" near your signature

What is the "reasonable person standard?"

(under breach of duty)

"would a reasonable / prudent person in the same situation act the same way?"

Is used to determine if the defendant's liablity

1) actual cause: if the plaintiff would NOT be injured had the defendant NOT performed their action

2) proximate cause: plaintiff's injury was the natural, probable, and forseeable result 

1) duty (to protect the plaintiff)

2) breach of duty 

3) causation

4) injury

Assent to a deal

ex) "when you go to the store, buy me milk and I'll pay you back" creates an agency relationship

1) Express Authority

2) Implied Authority

3) Apparent Authority

(Usually arrises as a natural addition to express authority)

Express Authority often IMPLIES the authority to do other related / reasonable / neccessary tasks to carry out the first task

Granted when agents give third parties the impression that they have authority to do an action

** the third party must reasonable rely on this authority, or else it is VOID

Ratification 

(definition)

Approval of unauthorized action taken by the agent

**The principal must have full knowledge of the transaction

Fiduciaries must act / work solely for the principal.

Ex) A real estate agent cannot purchase a lot that they found very cheap if it is a type of lot that their principal is searching for.

1. Obedience: (unless it's against the law)
2. Care: agent must excercise reasonable care
3. Loyalty: agents = fiduciaries
4. Accounting: for all $ generated

1) Fully disclose any and all information

2) Get the consent

1. Contract Compliance: principals have the POWER to breach a contract, but not always the RIGHT.
2. Reimbursement: agents are entitled to reimbursement for all expenses incurred that are in the scope of the business

Yes.

respondeat superior

When the principal tells the agent to commit the crime 

(within the scope of the agency)

**Note! some states impose liability on business owners for violating safety or health standards

1. It could end at a pre-set time
2. Mutual consent to end the contract
3. Changes in Circumstances: ex. death, impossible performance

Always.

1) Actual Notice for parties DIRECTLY involved

2) Constructive Notice for everyone else

(eg. newspaper)

Sole Proprietorship 

(details)

1. Owned by a single person
2. Owner has total control
3. Disadvantages:

What is the "default" way of governing Partnerships?

(what is the legislation called)

Uniform Partnership Act (UPA)

In all states except for Louisiana

Applies to all partnerships with 2 + people

1) Must be co-owners or co-"action-ers"

(If there is shared profits or jointly owned capital)

2) Must be for profit (not a charity)

Document that clarifies the rights / responsibilities of partners in a partnership

Created by the partners.

** If there is no AoP, then the UPA rules apply.

What are the 3 categories of partner's rights?

1) Partnership Property

2) Profit Sharing

3) Management Participation

What is Partnership Property?

(for a partnership)

Shared property designated for the partnership

Both parties have FULL RIGHTS to it

** Initial Funding is usually considered to be PP

(called capital contributions)

What is Profit Sharing?

(for a partnership)

UPA Default: "partners must equally share profits and losses.

** partners are NOT entitled to salaries if there is not an agreement that says they are

(REGARDLESS of the amount of work that they do)

What is Management Participation?

(for a partnership)

UPA: "each partner has EQUAL rights to manage the business

Usually a vote of majority controls most decisions

** Unanimous consent required for extraordinary matters

Yes, but to have management / "complete" position, unanimous consent must be given by the partners

** otherwise they just have financial rights

1. Each partner is a fiduciary to the others

Principal - Agent relationship is created

• Principal = partnership
• Agent = partners

Partners: jointly-liable (suing a partner requires suing EVERY PARTNER)

(Paying damages: uses Partnership Assests before Partner Assets)

An Estoppel used to hold partners/partnerships liable to 3rd parties.

1. Apparent partners may represent that they are a partner when they aren't
2. A partner must know that someone is misrepresenting themself as a partner

1. Dissolution: through a court decree. Done when a partner is unable to continue performing, and the other partners don't want to continue the partnership.
2. Winding-Up:  liquidation of assets. 

• Partnership Creditors have the 1st priority on partnership property.  
• Personal Creditors have 1st priority on partner property.

1. Non-partner creditors
2. Partner creditors
3. Partners to pay bills
4. Partners for profit

A partnership with general and limited partners.

General partners: manage and are fully liable

Limited partners: limited liability, but do NOT manage

** Must file a certificate of limited partnership

1. Seperate legal entity
2. Perpetual existance
3. Owners have limited liablity
4. Easy to transfer ownership assets (stocks)
5. Seperation of ownership and management
6. Pays taxes
7. Requires more procedures / laws / regulations

Purchase, hold, and sell property

Enter into contracts

Sue / be sued

Pay taxes

ONLY shareholders are taxed

Requirements: 

1) NO MORE THAN 35 shareholders

2) ALL shareholders must agree 

1) Promoters decide to form a corp

2) File Articles of Incorporation
3) First shareholder's meeting
4) First meeting of board of directors
5) De jure corp. now exists.

Promoters come together with an idea

Write the Corporate Charter

(AKA: Articles of Incorporation)

** Promoters are liabile until the Corp. is created.

First shareholder's meeting.

1) Stock certificates handed out

2) elect a Board of Directors

3) Adopt a set of bylaws (laws) for the corp.

First Board of Directors Meeting.

Elect officers.

Cover any matters needed to start business operation

De Jure corp. now exists.

The state or anyone else cannot challenge the corp.'s existance

** If incorporaters do not comply with its statutes, it is a de facto corp. and can be challenged by the state.

(eg. if they don't pay taxes)

When a corporation is found to exist only to protect the assets of the shareholders

Creditors are allowed to hold the shareholders personally liable.

1) Domestic: business is conducted in the state it was created in.

2) Public: established by the government

3) Quasi-Public: technically public, but high gov't regulation

4) Private: either nonprofit or profit

Profit: Closely Held (1 or fewer shareholders) or Publically Held (unrelated shareholders w/ no management)

Board of Directors

They tell the officers how to run day-to-day operations

Corporate Directors 

(details)

• serve until the 1st Board of Directors is elected
• usually becomes the 1st BoD
• 1 year terms
• usually have 3 members
• meet regularly (must have a certain quorum (#) of directors present to have meetings)
• Establish company policy
• ** Fudiciaries to the company

Corporate Officers

(details)

• Appointed by the BoD
• implement BoD policies
• oversee day-to-day operations
• ** act as agents to the company

Corporate Shareholders

(details)

2 types: 

1. Common Stockholders: normal type
2. Preferred Stockholders: "elite" type (recieve dividends and assets before CS)

1) Voting: straight or cumulative method

straight: 1 vote * # shares * # directors

cumulative: 1 vote * # shares * # of vacant spots

2) Dividends: cash or stock

3) Preemption: stockholders with preemption maintain their % share of stock when corp. changes # of issued stocks

4) Inspection: of books and records

5) Suing rights

1) Voluntary: corporation files the Certificate of Dissolution

2) Involuntary: done by administrative/judicial process

• ex) if they don't pay taxes, file forms, OR as a remedy for a court case (by shareholders)

• Combination of: partnership + subchapter S Corp.
• limited liability
• no restriction on # owners
• only shareholders are taxed
• Trasnsferring interests requires unanimous agreement
• ** states don't always recognice LLC

• Race
• Color
• Sex
• Age
• Disabliilty

Who has an advantage for:

1) Disparate treatment

2) Disparate impact

1) Defendant. Plaintiff must prove discriminatory intent

2) Plaintiff.  Does NOT need to show discriminatory intent.

Disparate Treatment

(general definition)

Employer literally discrminates someone based upon race, sex, religion, national origin, or disability.

Employee must prove this by using direct evidence.

Disparate Treatment

(requirements to prove/start a case)

1) plaintiff belongs to a protected class

2) plaintiff applied to the job, was qualified, and the employer was seeking applicants

3) plaintiff was rejected and the position remained open / kept seeking applicants

4) defendant usually offers a legitimate reason

5) plaintiff must now prove that this reason is just a cover-up for discrimination ("bullshit")

6) Defendant can argue against this evidence ("statstics were invalid / innacurate")

when there is evidence for both legitimate and discriminatory intent

defendant is still liable

Disparate Impact

(general definition)

Requirements that employers set up end up discriminating against a protected class

(eg. height restrictions limit Asians and Mexicans)

Plaintiff has to prove that the practice disqualifies more protected class than the majority class.

** Plaintiff does NOT need to prove discriminatory intent.

1) Show that it disproportionately disqualifies protected class

2) Employer's Defense: "it's job-related and consistant with scope of job"

3) Is there a less discrimnatory practice available?

1) Bona Fide Occupational Qualification: (BFOQ)

Occurs when there is employment practices that require certain characteristics 

**does NOT EVER apply to race!

2) Professionaly Developed Ability Tests: (disparate impact).

They are permitted as long as they aren't designed to discriminate

3) Seniority Systems: only when they aren't designed to discriminate

1. Considered discriminatory if it results in a selection for 1 race, sex, religion, or national origin that's less than 4/5 of the selection rate for the another.
2. Burden of proof shifts to the user of the test
3. 3 Methods to test validity:

1) Critereon Validity: compares test scores -> measure of performance

2) Content Validity: "is the test content a function of the job?"

3) Construct validity: "dooes the test indicate a psycholgoical trait for the job?"

Only apply when they aren't designed to discriminate

It's alright when it applies to all employees equally.

(regardless of membership in a protected class)

When employers prioritize members of protected classses

"encourages ________ and ______ to apply!"

1) Employers voluntarily adopt them in order to balance inequality

2) Courts require a firm to adopt them, for ex. if they found the firm to be discrimatory.

United Steelworkers V. Weber

The one from the begining of the class that dealt with the white guy complaining that he was disciminated against beause the employer was hiring only blacks

1) Quid Pro Quo: job benefits are exhanged for sexual favors

2) Hostile Environemnt: unwelcome sexual conduct creates a hostile environment

1) frequency of conduct

2) severity of conduct

3) is the conduct physically threatening? Or is it just a mere offensive-utterance?

4) does it interfere with work performance?

5) what is the effect on the employee's psychological well-being

1) have a duty to investigate: do it quickly

2) select the investigator (many firms have special S.H. Comittees)

3) Interview complaintant, respondant, witnesses

4) Arrive at conclusion based on law and guidelines from the Harris Case

5) Take prompt remedial action

It's treated as sex discrimination.

Preganncy must be treated the same way as any other medical condition

Can't discriminate by paying 1 sex more than the other

"equal work equal pay" (substantially equal)

Is this considered discrimination?

"Management Training Program: employee must rotate through all departments, but in that time they are still paid a manager's salary.

Is it considered wage discrimination when they are at unequal pay compared to the other sex in their present position?"

1) bona fide seniority / merit systems

2) earnings based on quantity/quality of output

3) factors other than sex

Includes atheism and agnosticism

Employers have a Duty to Accommodate religion:

• Employers must make reasonable accommodations for religion, UNLESS it creates an undue hardship
• Employers do not need to make accom. if it imposes MORE THAN a de minimis cost
• **Employers do not have to agree to accommodations offered by employees; only the accommodations that they (employer) offers

National Origin: refers to the country from which the individual or the individual's anscestors came from

Also includes invididuals with characteristsics typically associated with those groups

1) Citzenship: does NOT prohibit based upon American Citzenship.

**Instead, aliens are treated the same way as National Origin discrimnation (eg. Mexican)

2) Age: prohibits age discrim. against employees 40+

Covers: 

-employers with 20+ employees

-unions with 25+ employees

1) bona fide employee benefit plans that aren't just cover-ups to avoid the act

** Only applies when employers reduce benefits to older workers to offset increased cost of those benefits as employees age

ADA Prevents discrimination against otherwise qualified employees

Employers must offer reasonable accommodation

- modifying facilities, equipment, examinations, or other

  job requirements

** Employees are ONLY required to do so if it doesn't pose undue hardship 

1) victims must file charges of violations with the EEOC and their state employment discrimination agencies

2) individuals can't sue until the EEOC gives them a right-to-sue letter

a) if the EEOC's investigation has no reasonable cause to believe a violation occured, EEOC dismisses the charge and issues a right to sue letter.

b) If there IS reasonable cause, a determination letter is issued.

3) EEOC attempts to conciliate the dispute.  If this fails, it issues a right-to-sue letter.

No, you don't need a right-to-sue letter.

If the EEOC has had the charge for 60 + days