Canadian Employment Law Today | 3
Canadian HR Reporter, a Thomson Reuters business 2018
Cases and Trends
Taxi company not liable
for driver's sexual assault
Company gave driver opportunity but nature and expectations
of the job didn't increase the risk of assault
BY RONALD MINKEN
WHEN AN employee causes damage or
loss to a third party, employers can be held
"vicariously liable." But to what extent is an
employer liable for the employee's actions?
e most common form of vicarious li-
ability is when employers are held liable for
their employees' actions when they are dis-
charging their employment duties and in-
advertently cause loss or damage to a third
party. ere are two main policy rationales
as to why employers should be held vicari-
ously liable: It increases the likelihood that
victims will receive compensation for their
damage or loss; and it acts as a deterrent
mechanism to prevent future harm.
A more complicated issue, which arose in
the recent Ontario Court of Appeal decision
Ivic v. Lakovic, is when employers should be
liable for acts of their employees that are un-
authorized and intentionally wrong.
In Ivic, a taxi driver was accused of sexu-
ally assaulting a passenger in the taxi. e
driver had no criminal record and there was
no evidence that the taxi company knew the
driver was likely to sexually assault passen-
gers. In addition to the driver, owner, and
primary operator of the taxi, the passenger
sued the taxi company, pleading that it was
vicariously liable for the actions of the taxi
driver, the company was negligent, and the
company owed her a fiduciary duty that
it had breached. In a summary judgment,
the motion judge dismissed the passenger's
claim against the taxi company. She ap-
pealed, with the appeal focusing on the claim
of the taxi company's vicarious liability.
e Ontario Court of Appeal reinforced
the idea that courts are "reluctant to impose
no-fault liability for abhorrent, intentional
acts on the part of an employee." e ap-
peal court referenced the Supreme Court
of Canada decision Bazley v. Curry, stating,
"A wrong that is only coincidentally linked
to the activity of the employer and duties of
the employee cannot justify the imposition
of vicarious liability on the employer." e
appeal court further quoted the Bazley de-
cision, stating, "the fundamental question
is whether the wrongful act is sufficiently
related to conduct authorized by the em-
ployer to justify the imposition of vicarious
liability."
In Bazley, the Supreme Court outlined a
non-exhaustive list of factors to help deter-
mine whether the wrongful act by the em-
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