The court held that no, Southland is not legally liable for the tortious acts of

Question

The court held that no, Southland is not legally liable for the tortious acts of its 7-11 franchisee Campbell, who sold liquor to a minor, who then caused an automobile accident that killed one person and severely injured two other persons. Campbell, as a franchisee, was not an agent of Southland. Only Campbell managed the daytoday activities of the store: she hired and fired employees, and set their wages; and the franchise agreement provided that the relationship was one of an independent contractor. Using a minimum of three sentences, a) Do you agree with court's ruling? b) why or why not?

Explanation / Answer

Yes, the court’s ruling is correct as it is based on franchise agreement which provided that the relationship was one of an independent contractor not an agent of Southland. To avoid its liability on franchisee’s conduct, the franchisers here Southland can limits the previsions in the franchisee’s agreement which gives it the control over means of operating the business. Here only Campbell managed the day-to-day activities of the store as she hired and fired employees, and set their wages etc. therefore the Southland was not having much control over its franchisee Campbell’s business so limited liability also. They were not having employee –employer relationship or agent to the company therefore is status of independent contractor is the right interpretation.    

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