Agency Relationships — Liability of Principals and Independent Contractors

Cora and Caley, CARDWARE’s co-office managers have determined that CARDWARE Inc. is growing so rapidly that they need to hire a part-time advertising manager to market CARDWARE’s latest business, “Designer Car Seat Covers.” Camille has recommended Nicole Marriott to fill the position. Nicole has freelanced with several big agencies and brings with her a wealth of knowledge, integrated advertising software, and a host of media contacts to further the interests of CARDWARE. CARDWARE provides Nicole with an office and use of its telephones and equipment, such as copy machine, fax machine, and computer, although Nicole may use her own computer if she wishes.

While visiting with Z-1, a leading car manufacturer, in an attempt to secure its business, Nicole recognized a former colleague Raquel Dean whom she knew to be sly with business tactics in stealing ideas. Raquel walked by Nicole and accidentally bumped into her causing Nicole to drop a pile of papers with diagrams and profit graphs from Designer Car Seat Covers. Nicole, thinking that Raquel was trying to take her ideas, doubled up her fist and punched Raquel in the face knocking out her two front teeth and bruising her left eye. Raquel filed suit against CARDWARE based on battery.

Determine the following:

Whether or not Nicole is an independent contractor.

Discuss whether or not CARDWARE Inc. would be liable for Nicole’s torts/criminal acts if she is considered to be an independent contractor. Be sure to note the difference in outcome if she is determined to be an employee.