It is well established that general contractors are vicariously liable for damages resulting from the negligence of their employees, and not of their independent contractors (except in the case of “inherently dangerous” activities, Arthur v. Holy Rosary Credit Union, 139 N.H. 463 (1995)). But a general contractor can be liable for its own negligence in hiring an incompetent subcontractor.
“As a general rule, the employer has a duty to use reasonable care to choose a contractor who is properly qualified to perform the work. . . ‘[A]n employer of an independent contractor may be liable to one injured as a result of the contractor’s fault where it is shown that the employer was negligent in selecting a careless or incompetent person with whom to contract.’” Arthur v. Holy Rosary Credit Union, 139 N.H. 463, 468 (1995) (citations omitted). Thus far, in New Hampshire at least, this rule has been applied only to personal injury, not to property damage. Guitarini v. Macallen Company, 98 N.H. 118, 119 (1953) (finding that the law “requires one who employs an independent contractor to do work which involves risk of bodily harm to others unless skillfully and carefully done to exercise reasonable care in selecting a competent contractor”).
It stands to reason that “an employer who has had previous successful experience with an independent contractor in the performance of his work cannot be held liable on the theory of the negligent selection of the contractor.” Western Arkansas Tel. Co. v. Cotton, 259 Ark. 216, 219, 532 S.W.2d 424, 426 (1976). But if this is your first time working with a sub – and there is a first time for everyone – how much due diligence in the selection process is required?
As with most torts involving negligence, “reasonableness” is the key to establishing the contours of the duty. Relying on reputation is fine, but vetting subs is important whenever the sub does not already have a good reputation. Subcontracting to someone with scant experience but who “talks a good game” likely won’t cut it. Simply asking a sub about his safety record on other jobs and taking him at his word with no effort to verify the answer likely won’t suffice. (Checking online for OSHA complaints and violations takes all of 60 seconds.)
The fact that a specialty trade is licensed (plumbers, electricians, etc.) is often thought to make any selection safe from attack, on the theory that the licensee has already been vetted by the State. Don’t count on it. Records of disciplinary actions against licensees are retained for seven years and checkable online from the N.H. Office of Professional Licensure and Certification.
The diligence required in selecting an independent contractor is not one-size-fits-all, but some general guidelines are available. Section 411 of the Restatement (Second) of Torts, comment c, advises: “Certain factors are important: (1) the danger to which others will be exposed if the contractor’s work is not properly done; (2) the character of the work to be done-whether the work lies within the competence of the average man or is work which can be properly done only by persons possessing special skill and training; and (3) the existence of a relation between the parties which imposes upon the one a peculiar duty of protecting the other.”
Accidents will occasionally happen even on a competent subcontractor’s watch. In such a case, failing to vet the subcontractor won’t matter. Riley v. A.K. Logistics, Inc., 2017 WL 2501138 at *2 (E.D. Mo. June 9, 2017) (“[A]n employer is not liable for the negligence of its independent contractor, notwithstanding any lack of care it took in selecting the contractor, if the contractor hired was in fact competent.”). But that’s no reason to press your luck.
Naturally any GC will insist that its subs carry liability insurance to cover any damages resulting from their negligence, and will have its own insurance as well. But insurance doesn’t prevent a successful lawsuit; it simply pays any damages awarded (above the deductible). And usually a hike in premiums results. Better to prevail in the lawsuit than to suffer a black mark!
“As a general rule, the employer has a duty to use reasonable care to choose a contractor who is properly qualified to perform the work. . . ‘[A]n employer of an independent contractor may be liable to one injured as a result of the contractor’s fault where it is shown that the employer was negligent in selecting a careless or incompetent person with whom to contract.’” Arthur v. Holy Rosary Credit Union, 139 N.H. 463, 468 (1995) (citations omitted). Thus far, in New Hampshire at least, this rule has been applied only to personal injury, not to property damage. Guitarini v. Macallen Company, 98 N.H. 118, 119 (1953) (finding that the law “requires one who employs an independent contractor to do work which involves risk of bodily harm to others unless skillfully and carefully done to exercise reasonable care in selecting a competent contractor”).
It stands to reason that “an employer who has had previous successful experience with an independent contractor in the performance of his work cannot be held liable on the theory of the negligent selection of the contractor.” Western Arkansas Tel. Co. v. Cotton, 259 Ark. 216, 219, 532 S.W.2d 424, 426 (1976). But if this is your first time working with a sub – and there is a first time for everyone – how much due diligence in the selection process is required?
As with most torts involving negligence, “reasonableness” is the key to establishing the contours of the duty. Relying on reputation is fine, but vetting subs is important whenever the sub does not already have a good reputation. Subcontracting to someone with scant experience but who “talks a good game” likely won’t cut it. Simply asking a sub about his safety record on other jobs and taking him at his word with no effort to verify the answer likely won’t suffice. (Checking online for OSHA complaints and violations takes all of 60 seconds.)
The fact that a specialty trade is licensed (plumbers, electricians, etc.) is often thought to make any selection safe from attack, on the theory that the licensee has already been vetted by the State. Don’t count on it. Records of disciplinary actions against licensees are retained for seven years and checkable online from the N.H. Office of Professional Licensure and Certification.
The diligence required in selecting an independent contractor is not one-size-fits-all, but some general guidelines are available. Section 411 of the Restatement (Second) of Torts, comment c, advises: “Certain factors are important: (1) the danger to which others will be exposed if the contractor’s work is not properly done; (2) the character of the work to be done-whether the work lies within the competence of the average man or is work which can be properly done only by persons possessing special skill and training; and (3) the existence of a relation between the parties which imposes upon the one a peculiar duty of protecting the other.”
Accidents will occasionally happen even on a competent subcontractor’s watch. In such a case, failing to vet the subcontractor won’t matter. Riley v. A.K. Logistics, Inc., 2017 WL 2501138 at *2 (E.D. Mo. June 9, 2017) (“[A]n employer is not liable for the negligence of its independent contractor, notwithstanding any lack of care it took in selecting the contractor, if the contractor hired was in fact competent.”). But that’s no reason to press your luck.
Naturally any GC will insist that its subs carry liability insurance to cover any damages resulting from their negligence, and will have its own insurance as well. But insurance doesn’t prevent a successful lawsuit; it simply pays any damages awarded (above the deductible). And usually a hike in premiums results. Better to prevail in the lawsuit than to suffer a black mark!
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