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University of Miami Business Law Review

Document Type

Article

Abstract

One of the most perplexing areas of current tort law is the ostensible agency tort doctrine, which courts use to determine whether companies should be held liable for the negligence of their independent contractors. In most cases, liability under this doctrine requires proof the plaintiff detrimentally relied on a representation that the contractor was an employee of the defendant. However, in cases involving the negligence of independent contractor emergency room doctors, courts often hold hospitals liable under the ostensible agency tort doctrine without requiring such proof. Why does the doctrine take two inconsistent forms?

This Article argues that the law’s incoherence is a product of Section 429 of the Second Restatement of Torts. Prior to Section 429, courts used two logically distinct theories for holding companies responsible for the negligence of their independent contractors. One theory, known as ostensible agency, was based on the idea of estoppel and required proof that the defendant presented the negligent contractor as its authorized agent or employee plus proof that the tort was caused by the plaintiff’s detrimental reliance on that false appearance of agency. The other theory, called the non-delegable duty doctrine, held companies liable if they failed to fulfill an affirmative duty owed to the plaintiff, stating that companies could not avoid responsibility by delegating their duty to an independent contractor.

Section 429 was based on one case decided under the estoppel-based ostensible agency doctrine and six cases decided under the non-delegable duty doctrine. Unfortunately, the Restatement provision adopted a standard that was not consistent with either doctrine. Instead, Section 429 articulated a test that keyed liability to what the plaintiff thought about the relationship between the defendant and the negligent actor. Courts used this test to create a liberal version of the ostensible agency doctrine that imposed liability on hospitals for the negligence of their independent contractor emergency room doctors without proof of a false representation or detrimental reliance. Those same results could have been justified in an intellectually coherent way under the non-delegable duty doctrine and likely would have been if Section 429 had not confused the law.

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