Employer Liability in Hawaii

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In general, an employer may be held liable for the conduct of an employee acting within the scope of his or her employment. US v Hilton Hotels Corp., 467 F.2d 1000, 1004-1007 (C.A.9, 1972) See also Lucas v Liggett & Meyers Tobacco Co., 50 Hawaii 506, 480 (Hawaii, 1968)(A principal who puts a servant or other agent is a position which enables the agent, while apparently acting within his authority, to commit a fraud upon third persons is subject to liability to such third persons for the fraud.) Indeed, in certain cases a corporation may even be held responsible even if the acts of its employee or agent were done contrary to the corporation’s policy or employer’s instruction so long as it was within the scope of his or her “apparent authority”. Id. It is not determinative if the employee or agent is acting in his or her own interest when committing the act, it will not relieve the employer of liability. See Lucas v Liggett & Meyers Tobacco Co., 50 Hawaii at 483.

In the alternative, if a Court deems that the employee’s actions were outside the scope of employment, an employee may still be liable if “the conduct violated a non-delegable duty of the [employer], or… the [employee] purported to act…on behalf of the employer and there was reliance upon apparent authority, or [the employee] was aided in accomplishing the tort by the existence of the agency relationships”. Hardwicke v Boychoir School, 902 A.2d 900, 919-920 (N.J., 2006) citing Restatement 2nd of Agency sec. 219(2)(c) to (d)(1958). Restatement 2nd of Agency sec. 219(2) specifically provides that:

(2) A master is not subject to liability for the torts of his servants acting outside the scope of their employment, unless:
(a) the master intended the conduct or the consequences, or
(b) the master was negligent or reckless, or
(c) the conduct violated a non-delegable duty of the master, or
(d) the servant purported to act or to speak on behalf of the principal and there was reliance upon apparent authority, or he was aided in accomplishing the tort by the existence of the agency relation.

Restatement 2nd of Agency sec. 219(2) (Emphasis added).

In Hardwicke v American Boychoir School, the plaintiff, a former student of the American Boychoir School, was sexually abused by school employees and brought an action against the school. Hardwicke v Boychoir School, 902 A.2d at 902. Relying on these principals, the New Jersey Supreme Court held that the boarding school, as employer, could be held vicariously liable for common-law claims for the child abuse committed by its employees. Hardwicke v Boychoir School, 902 A.2d at 920. In particular, the court in interpreting Restatement 2nd of Agency sec. 219(2)(d), held that when an employer delegates authority to an employee to “control the work environment” and the employee abuses that delegated authority, than the employer may be held vicariously liable. Id.

Additionally, in certain circumstances the employer may even be held liable for failing to detect and stop an employee’s wrongdoing. US v Demauro, 581 F.2d 50, (2d Cir., 1978). See also Doe Parents v State, 100 Hawaii 34, 68 (Hawaii, 2002)(…if the State knew, or reasonably should have anticipated, that one of its employees would commit an intentional tort against a person to whom the State owed a duty of care, the State is liable for the negligence of those employees who were in a position to take reasonable precautions against the anticipated harm.). This claim of action is based on the negligence of the employer and/or employer’s supervisors. Id.

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