Vicarious liabilityEmployer employeeSupreme Court of India

State Bank of India v Shyama Devi

AIR 1978 Supreme Court 126319781 min read
The case in brief30-second read
Facts
An officer of SBI committed a tortious act while performing banking duties, using his employment position to cause harm to a customer. The question was whether SBI (employer) was liable for the officer's wrongful act.
Issue
Whether an employer is liable for an employee's tortious act committed using the employment position.
Held
SBI was vicariously liable. The officer's tortious act was committed in the course of employment, while performing banking duties.
Principle
Employer is vicariously liable for wrongs committed by employee in the course of employment, even if the specific act was unauthorised.
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Facts

  • An officer of SBI committed a tortious act while performing banking duties, using his employment position to cause harm to a customer
  • The question was whether SBI (employer) was liable for the officer's wrongful act

Issue

  1. Whether an employer is liable for an employee's tortious act committed using the employment position.

Held

  • SBI was vicariously liable
  • The officer's tortious act was committed in the course of employment, while performing banking duties
  • The employer is liable for wrongs committed by employees during and in connection with employment duties, even if the specific manner of committing the wrong was unauthorised
  • Employer cannot escape liability by showing the specific act was "unauthorised" if done during employment duties

Ratio decidendi

Employer is vicariously liable when: (1) employer-employee relationship exists, (2) wrong committed in course of employment, (3) employee used employment position to cause harm. Employer cannot escape liability by showing the specific act was "unauthorised" if done during employment duties.

Exam use

How to use it in an answer

  • Part A: Indian authority confirming vicarious liability of institutional employers (banks) for officers' tortious acts.
  • Part B: Applied the respondeat superior principle to the banking context.
  • Key line: "Employer is vicariously liable for wrongs committed by employees in the course of employment, even if the specific act was unauthorised."

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Citation

State Bank of India v Shyama Devi AIR 1978 Supreme Court 1263

Reported: AIR 1978 Supreme Court 1263. This is an educational summary, not the judgment itself. Cite the reported version in professional or academic work.