Opinion ID: 1172244
Heading Depth: 2
Heading Rank: 3

Heading: Authorization

Text: We believe the court of appeals also erred in overlooking the word authorization as used in A.R.S. § 41-621(A)(3), which provides coverage for officers acting in course and scope of employment or authorization.  (Emphasis added.) We note first that authorization must mean something other than the idea that the tortious act was authorized. If the act itself was authorized, then the conduct would have been in the course and scope. We believe, therefore, that authorization as used in the statute applies to vicarious liability found outside course and scope of employment. That liability is described in RESTATEMENT § 219(2) and may be imposed because of the authority or power the master has given a servant, especially one in a supervisorial position. Under common-law principles of agency a master is vicariously liable outside of course and scope of employment for torts committed by a servant when the servant purports to act or speak on behalf of the master and was aided in accomplishing the tort by the existence of the agency relationship. RESTATEMENT § 219(2)(d). Heinze spoke and acted for APAAC. It put him in a position to control and run its business, evidently investing him with power to run its office and control its employees. It did this arguably knowing or having reason to know of his aberrant propensities. It kept him in that position for nearly a decade, again arguably knowing the manner in which he conducted himself. From this record, it appears APAAC did not adopt either a formal policy against sexual harassment or a grievance procedure for employees. As a result, complaints about sexually harassing incidents presumably were to be resolved by Heinze, the perpetrator. Given these factors, we cannot say as a matter of law that the master has no vicarious liability for acts outside the scope of employment. The comment to RESTATEMENT § 219 puts it in the following words: This Subsection enumerates the situations in which a master may be liable for torts of servants acting solely for their own purposes and hence not in the scope of employment.... Clause (d) includes primarily situations in which the principal's liability is based upon conduct which is within the apparent authority of a servant, as where one purports to speak for his employer in defaming another or interfering with another's business. Apparent authority may also be the basis of an action of deceit, and even physical harm. In other situations, the servant may be able to cause harm because of his position as agent, as where a telegraph operator sends false messages purporting to come from third persons. Again the manager of a store operated by him for an undisclosed principal is enabled to cheat the customers because of his position. The enumeration of such situations is not exhaustive, and is intended only to indicate the area within which a master may be subjected to liability for acts of his servants not in scope of employment. RESTATEMENT § 219(2), cmt. e (citations omitted) (emphasis added). We believe RESTATEMENT § 219(2)(d) deals with a supervisor's authority and that employer liability in factual situations such as this is well recognized both in agency case law and in Title VII cases. See, e.g., Faragher, 111 F.3d at 1536; see also Oppenheimer, supra, 81 CORNELL L. REV. at 88-90 and nn. 110-113 (analyzing both common law and Title VII cases). Oppenheimer concludes that such liability is properly viewed as vicarious, not direct, since it [may be] imposed without considering the fault of the employer. Id. at 88. Many of the federal cases have found vicarious liability properly imposed under RESTATEMENT § 219(2)(d) under facts similar to those before us. See, e.g., Harrison v. Eddy Potash, Inc., 112 F.3d 1437, 1445-46 (10th Cir.1997); Karibian v. Columbia University, 14 F.3d 773, 780 (2d Cir.1994). Application of the authority concept to supervisorial sexual harassment cases has been described in the following manner: Moreover, under common law agency principles an employer is also liable for an employee's wrongful acts, even if those acts are not committed within the actual scope of his employment, if the employee uses his apparent authority to accomplish the wrongful acts and so is acting within the apparent scope of his employment. Martin, 48 F.3d at 1352 (citations omitted) (emphasis in original). Under the common law of agency a supervisor's use of the actual or apparent authority of his positionpower conferred by the employergives rise to [the employer's] liability under a theory of respondeat superior. Nichols, 42 F.3d at 514, citing RESTATEMENT § 219(2)(d) and cases; see also Harrison, 112 F.3d at 1450. Heinze's sexually abusive acts were thus within his authorization if it is found that APAAC gave Heinze the power and authority with which to create and maintain a sexually abusive work environment or to establish a quid pro quo position over APAAC employees. We believe the record in this case, including the authority given Heinze, his methods of operating the office, APAAC's tolerance of those methods, and the lack or presence of sexual harassment policies or grievance procedures are factors that prohibit summary judgment in favor of the state on this issue also. See Harrison, 112 F.3d at 1444.