What is vicarious liability?

Vicarious liability refers to a legal principle that holds one party responsible for the actions of another party, especially in situations where the actions are performed within the scope of employment or under the authority granted by the first party. This means that an employer can be held liable for the negligent actions of an employee if those actions occur while the employee is performing their job duties.

The correct choice highlights that vicarious liability involves accepting risk for actions performed on your behalf by others. This is critical in understanding how liability is distributed in various contexts, such as employment and agency relationships, where the primary party may not have directly engaged in misconduct but still faces liability due to the acts of another.

Other options do not accurately capture the essence of vicarious liability. For instance, taking full responsibility for personal actions only focuses on individual liability without considering the shared responsibility inherent in vicarious liability. Liability limited to contractual obligations relates to obligations defined within contracts rather than the broader implications of tort law. Exclusively personal liability for company failures suggests an absolute distinction between personal and corporate liability, which overlooks the scenarios where a company may be liable for its employee's actions under the umbrella of vicarious liability.