LLM Notes: Discuss the tortious liability of a public utility corporation with relevant caselaws

1. Introduction – Law of Torts

Tort: A civil wrong, other than breach of contract or breach of trust, whereby a person’s legal right is violated and he suffers harm.

The purpose of tort law is to provide compensation for wrongful loss.

Public Utility Corporations, though government-owned or controlled, can also be subject to tortious liability like private individuals or companies.

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LLM Notes: Tortious Liability of Public Corporations in India

 Definition and Scope

Tortious liability refers to the legal responsibility of an entity to compensate for harm or injury caused by its wrongful acts or negligence. In India, public corporations—such as LIC or Food Corporation of India—are statutory bodies created by special acts of Parliament and possess a separate legal identity from the government.

Liability in Torts

• Public corporations are liable for torts (civil wrongs) committed by their employees or agents during the course of their employment, provided the act falls within the powers and purposes of the corporation.

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Supreme Court: What should be the distinction between approach of court while granting compensation under Motor vehicles Act and compensation for tortious liability?

Furthermore, Motor Vehicles Act of 1988 is a beneficial

 and welfare legislation Ningamma v United India Insurance Co. Ltd., (2009) 13 SCC 710  that seeks to provide

compensation as per the contemporaneous position of an

 individual which is essentially forward-looking. Unlike

tortious liability, which is chiefly concerned with making up

for the past and reinstating a claimant to his original

position, the compensation under the Act is concerned with

providing stability and continuity in peoples' lives in the

 future. See Peter Cane, Atiyah’s Accidents, Compensation and the Law (7th Edition, Cambridge University Press, 2006) Keeping the abovementioned principles in the backdrop, we now move on to the facts at hand. {Para 12}

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

 CIVIL APPEA L NOS. 1162 - 1163 OF 2025

S. VISHNU GANGA & ORS Vs M/S ORIENTAL INSURANCE COMPANY LIMITED.

Author: AHSANUDDIN AMANULLAH, J.

Citation:  2025 INSC 123.

Citation: JANUARY 29, 2025.

Read full Judgment here: Click here.

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Leading Judgment explaining judgment of Rylands v. Fletcher

We
would like to quote hereinbelow these two paragaphs for our

benefit:
“8. Winfield has defined tortious law arising from
breach of a duty primarily fixed by law; this duty is
towards persons generally and its breach is
redressable by an action for unliquidated damages.
In general, torts consist of some act done without
just cause or excuse.
“The law of torts exists for the purpose of
preventing men from hurting one another
whether in respect of their property, their
presence, their reputations or anything which
is theirs.”
Injury and damage are two basic ingredients of tort.
Although these may be found in contract as well
but the violations which may result in tortious
liability are breach of duty primarily fixed by the law
while in contract they are fixed by the parties
themselves. Further in tort the duty is towards
persons generally. In contract it is towards specific
person or persons. An action for tort is usually a
claim for pecuniary compensation in respect of
damages suffered as a result of the invasion of a
legally protected interest. But law of torts being a
developing law its frontiers are incapable of being
strictly barricaded. Liability in tort which in course of
time has become known as ‘strict liability’, ‘absolute
liability’, ‘fault liability’ have all gradually grown and
with passage of time have become firmly
entrenched. ‘Absolute liability’ or “special use
bringing with it increased dangers to others”
(Rylands v. Fletcher [LR (1868) 3 HL 330 : 37 LJ
Ex 161 : [1861-73] All ER Rep 1] ) and ‘fault liability’
are different forms which give rise to action in torts.
The distance (sic difference) between ‘strict liability’
and ‘fault liability’ arises from presence and
absence of mental element. A breach of legal duty
wilfully, or deliberately or even maliciously is
negligence emanating from fault liability but injury
or damage resulting without any intention yet due
to lack of foresight etc. is strict liability. Since duty is
the primary yardstick to determine the tortious
liability its ambit keeps on widening on the
touchstone of fairness, practicality of the situation
etc. In Donoghue v. Stevenson[(1932) AC 562 :

1932 All ER Rep 1] a manufacturer was held to be
liable to ultimate consumer on the principle of duty
to care. In Anns v. Merton London Borough Council
[(1978) AC 728 : (1977) 2 All ER 492] it was, rightly,
observed:
“[T]he broad general principle of liability for
foreseeable damage is so widely applicable
that the function of the duty of care is not so
much to identify cases where liability is
imposed as to identify those where it is not,….”
Truly speaking entire law of torts is founded and
structured on morality that no one has a right to
injure or harm others intentionally or even
innocently. Therefore, it would be primitive to class
strictly or close finality (sic finally) the everexpanding
and growing horizon of tortious liability.
Even for social development, orderly growth of the
society and cultural refineness, the liberal approach
to tortious liability by courts is more conducive.
9. In between strict liability and fault liability there
may be numerous circumstances in which one may
be entitled to sue for damages. And it may be partly
one or the other or may be both. In a welfare
society construction of dam or bundh for the sake
of community is essential function and use of land
or accumulation of water for the benefit of society
cannot be non-natural user. But that cannot
absolve the State from its duty of being responsible
to its citizens for such violations as are actionable
and result in damage, loss or injury. What is
fundamental is injury and not the manner in which it
has been caused. ‘Strict liability’, ‘absolute liability’,
‘fault liability’ and ‘neighbour proximity’ are all
refinements and development of law by English
Courts for the benefit of society and the common
man. Once the occasion for loss or damage is
failure of duty, general or specific, the cause of
action under tort arises. It may be due to
negligence, nuisance, trespass, inevitable mistake
etc. It may be even otherwise. In a developed or
developing society the concept of duty keeps on
changing and may extend to even such matters as
was highlighted in Donoghue v. Stevenson [(1932)
AC 562 : 1932 All ER Rep 1] where a manufacturer

was held responsible for injury to a consumer. They
may individually or even collectively give rise to
tortious liability. Since the appellant suffered loss
on facts found due to action of respondent's
officers both at the stage of construction and failure
to take steps even at the last moment it was liable
to be compensated.”
The Court, thereafter, explained that in order to become a claim
as actionable claim, it is necessary to determine that the
defendant was guilty of negligence.
22) There are two exceptions to the aforesaid rule of strict liability,
which were recognized in Rylands v. Fletcher itself, viz.: (a)
where it can be shown that the escape was owing to the plaintiff's
default, or (b) the escape was the consequence of vis major or
the act of God. An act of God is that which is a direct, violent,
sudden and irresistible act of nature as could not, by any amount
of ability, have been foreseen, or if foreseen, could not by any
amount of human care and skill have been resisted. Generally,
those acts which are occasioned by the elementary forces of
nature, unconnected with the agency of man or other cause will
come under the category of acts of God. Examples are: storm,
tempest, lightning, extraordinary fall of rain, extraordinary high
tide, extraordinary severe frost, or a tidal bore which sweeps a
ship in mid-water. What is important here is that it is not
necessary that it should be unique or that it should happen for the

first time. It is enough that it is extraordinary and such as could
not reasonably be anticipated. 

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 1866 OF 2016
VOHRA SADIKBHAI RAJAKBHAI & ORS.
V
STATE OF GUJARAT & ORS.
Dated:MAY 10, 2016.

Citation:(2016) 12 SCC 1

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UK Supreme court Judgment on vicarious liability of prison authorities for torts of prisoners

The fact that the prison service, and the operators of contracted-out prisons,
are under a statutory duty to provide prisoners with useful work, is not incompatible
with the imposition of vicarious liability. The legislation does not itself exclude the
imposition of vicarious liability. Nor is it argued that any distinct point arises under
section 2(1)(a) of the Crown Proceedings Act 1947, in terms of which the Crown is
subject to all those liabilities in tort to which, if it were a private person of full age
and capacity, it would be subject in respect of torts committed by its servants or
agents. Authorities concerned with compulsory pilotage are not in point: the prison
service is not required to provide particular types of employment, or to allocate 
particular prisoners to particular activities. In practice, prisoners can be allocated to
a variety of workplaces both inside and outside prisons, having regard to the relevant
risks. More particularly, the prison service is not compelled to employ prisoners in
the kitchen, and has a meaningful power of selection in respect of the prisoners it
chooses to employ there. It appears from the evidence that the prison service takes
particular care when selecting prisoners who are suitable to work in the kitchen,
having regard to the risks involved in that setting. A restricted pool from which to
select a workforce was a feature of the Christian Brothers case, and is not
uncommon even in ordinary cases of employment: an employer can only select from
those who apply for appointment, and may often have a small pool from which to
choose.
Hilary Term
[2016] UKSC 10
On appeal from: [2014] EWCA Civ 132
JUDGMENT
Cox (Respondent) v Ministry of Justice (Appellant)
before
Lord Neuberger, President
Lady Hale, Deputy President
Lord Dyson
Lord Reed
Lord Toulson
JUDGMENT GIVEN ON
2 March 2016

LORD REED: (with whom Lord Neuberger, Lady Hale, Lord Dyson and
Lord Toulson agree)

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UK Supreme court Judgment on vicarious liability of employer for tortious liability of employee

 But there is no need for the law governing the circumstances in which an
employer should be held vicariously liable for a tort committed by his employee to
be on the move. There have been no changes in societal conditions which require
such a development. The changes in the case law relating to the definition of the
circumstances in which an employer is vicariously liable for the tort of his employee
have not been made in response to changing social conditions. Rather they have
been prompted by the aim of producing a fairer and more workable test.
Unsurprisingly, this basic aim has remained constant. The Salmond test defined a
wrongful act by a servant in the course of his employment as “either (a) a wrongful
act authorised by the master or (b) a wrongful and unauthorised mode of doing some
act authorised by the master”: Salmond, Law of Torts, 1st ed (1907), p 83; and
Salmond & Heuston on the Law of Torts, 21st ed (1996), p 443. As Lord Steyn said
in Lister at para 20, this was “simply a practical test serving as a dividing line
between cases where it is or is not just to impose vicarious liability” (emphasis
added). The importance of Lister (and the Canadian case of Bazley v Curry (1999)
174 DLR (4th) 45 whose reasoning it adopted) is that it recognised the difficulty
created by the second limb of the Salmond test. This was not effective for
determining the circumstances in which it was just to hold an employer vicariously
liable for committing an act not authorised by the employer. The close connection
test was introduced in order to remedy this shortcoming. This improvement was
achieved by the simple expedient of explicitly incorporating the concept of justice
into the close connection test. The new test was, therefore, by definition more
effective than the Salmond test for determining the circumstances in which it is just
to hold an employer vicariously liable for the unauthorised acts of his employee. 
Hilary Term
[2016] UKSC 11
On appeal from: [2014] EWCA Civ 116
JUDGMENT
Mr A M Mohamud (in substitution for Mr A
Mohamud (deceased)) (Appellant) v WM Morrison
Supermarkets plc (Respondent)
before
Lord Neuberger, President
Lady Hale, Deputy President
Lord Dyson
Lord Reed
Lord Toulson
JUDGMENT GIVEN ON
2 March 2016 
Indian Citation : AIR 2016 IC 75

LORD TOULSON: (with whom Lord Neuberger, Lady Hale, Lord Dyson
and Lord Reed agree)

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