Legal Liability Quiz

Overview of Legal Liability

• Legal liability can be enforced by either civil law or criminal law.
• Liability concerns both civil law and criminal law and can arise from various areas of law, such as contracts, torts, taxes, or fines given by government agencies.
• Theories of liability include breach of contract, negligence, negligence per se, respondeat superior, vicarious liability, strict liability, or intentional conduct.
• Each theory of liability has certain conditions or elements that must be proven by the claimant before liability will be established.
• Limited liability is a method of protection included in some business formations that shields its owners from certain types of liability and that amount a given owner will be liable for.
• Sole proprietorships and partnerships do not include limited liability.
• Product liability governs civil lawsuits between a plaintiff and defendant who furnishes defective goods that caused loss or injury.
• There is a form of liability that exists between employers and their employees called vicarious liability.
• Respondeat superior is a legal principle that dictates when an employer is responsible for the actions of an employee.
• An employer may be held liable for the actions of an employee if it is unlawful, or the employee's negligent actions while working cause damages to property or injury.
• An agent is a person who has the power to act on behalf of another party, and usually, a principal is liable for a contract made by the agent if the agent had actual or apparent authority to make the contract.
• Economists use the term "legal liability" to describe the legal-bound obligation to pay debts.