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Chamberlain College of Nursing *
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1510
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Law
Date
Nov 24, 2024
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docx
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2
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Agency Law, Its Application in the Workplace, and Liability for Employers
Reviewing the case scenario, the bank is liable for Carl's death under the agency law
of doctrine of respondeat superior. According to Miller (2018), the doctrine of respondeat
superior applies when the employer is held liable for the employee's omissions or negligent
actions in the course and the scope of the employee's employment. This implies that the
employees must conduct duties for the employer when they engaged in an act of negligence
for the employer to be held under respondeat superior. As illustrated in the scenario, Carl, a U
bank credit officer, acted within the course and scope of his employment when he passed
through Rubin's house and participated in the investment scheme. Also, passing through
Rubin's house when he was on his way for a business meeting to meet with a potential client
is still within the scope of his employment. Therefore, since Carl's negligent actions
happened in the course and the scope of the bank's employment, the bank is held liable for his
death.
Additionally, U Bank will be liable to Rubin if they can prove that the bank was
aware of Carl's investment scheme and failed to implement measures to stop it. This implies
that if the bank was aware of Carl's illegal investment scheme, they could be held liable for
losses that Rubin suffered. In addition, U Bank could also be held liable for securities fraud if
it is proven that Carl was employing non-public information from the bank to conduct insider
trading (Miller, 2018). Moreover, Rubin is guilty of breaching the Securities Exchange Act of
1934 if it can be proven that he conducted insider trading through trading securities grounded
on the non-public information that Carl told him. Additionally, since Carl was a credit officer
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for the bank that had access to the client's non-public information, using the information for
his gain is a breach of his fiduciary duty to the bank. Lastly, the case illustrates that Carl has
contracted Rubin, an independent accountant privately, to sell securities relying on the bank's
client information. This made Rubin consider Carl, a very smart person with a nose for
business (Miller, 2018). This means Rubin knew that the information he used for trading
securities was obtained unlawfully by Carl; hence he can be held liable for insider trading.
Works Cited
Miller, Roger L.
Cengage Advantage Books: Business Law Today, The Essentials: Text and
Summarized Cases
. Cengage Learning, 2018.
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