Vicarious liability is of particular concern to resource companies operating in foreign jurisdictions, especially countries with high corruption risks or human rights issues.
In the May 16, 2014 issue of The Lawyers Weekly, Davis LLP's Graham Erion delves into two recent cases which underscore the importance of conducting proper due diligence when resource companies engage the services of third parties. He outlines several key steps counsel can take to help their clients avoid vicarious liability:
- ensure third-party contractors or agents have existing policies for complying with relevant laws
- ensure proper training programs and oversight mechanisms are in place for such policies
- obtain "independent assurances that the agents to be retained have not been the subject of prior investigations or criminal wrong-doing"
- put into place contractual protections to mitigate risks
- institute termination rights if there is "reasonable suspicion that an agent has violated their compliance policy"
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