Hypothetical situation

Shield

Inspired by actual events and a long pointless argument:

Imagine Boards Vending Ltd have a vending machine in your workplace. A user sticks in his money, and due to a technical malfunction, it dispenses lots of additional products that he hasn't paid for. The user makes off with the additional products and tells nobody.

Along comes Boards Vending Ltd to restock the vending machine, and they notice the amount of money in the hopper is significantly smaller than it should be.

Can Boards Vending Ltd claim the trade price of the missing items from your employer, by arguing their items were effectively stolen on your property?

To make it more interesting, nothing in the placement contract states what should happen in a case like this.

Reloc8

I would say the vending machine company has no remedy against the employer in the absence of an explicit term in the agreement to the effect that the employer guarantees the money in the machine will equal the value of goods out of the machine. The contract however is with the employer and is presumably in terms allowing the machine to be placed on the premises, serviced & stocked etc. and only deals with those aspects of the placement of the machine. A guarantee of the nature described would be fundamentally unusual.

As to whether there is any remedy outside of the contract with the employer, what has happened here is, in civil law, a conversion of the goods. The employee has committed this and the only way the employer is liable is if the employee's tortious act is an act within the scope of his employment authorised by the employer or so closely connected to an authorised act as to constitute an authorised act for the purpose of vicarious liability. I don't think this can be the case. Further, the employer would if held liable effectively be accountable to the vending machine owner for a defect in the machine, which seems ludicrous.

The only another analysis I can see would be to consider the placement of the vending machine as an offer by the vending machine company (not an invitation to treat as the contract is complete on insertion of money which is the acceptance, and its not invalid as an offer to the world at large - its an offer to those persons permitted to be on the premises) the acceptance of which is the employee inserting money. The employee is perhaps guilty of breach of that contract in removing goods from the machine which he has not paid for (there being an implied term in the contract that he wouldn't do so). I don't like this analysis as I don't think there is an intention to create legal relations with the employee in the placement of the machine. That said, even if there were, the remedy is still as against the employee only.

That's as against the employer and employee. There is however scope for the vending machine company to consider whether the machine is defective (remedy v supplier) or maintained poorly (remedy against perhaps another party if maintenance is not done by the vending machine company's employees).

As an illustrative example to all of the foregoing, would the employer be liable to a bank if an ATM on the premises spewed out money in excess of what was sought by users and failed to account for the money out properly ?

Seeing as how I've tried to answer the question, can you tell us is this an academic issue (i.e. homework) or simply a hypothetical you're curious about ?

Shield

It's something that happened a while ago in a company in Dublin, and I got to discussing it with some legal minded friends who couldn't agree where the liability fell in the absence of contractual agreement.

Reloc8

Glad to help I actually missed that you said this arose from a discussion you'd had in your post.

I suspect the point that the employer can only be liable for authorised acts or acts considered authorised committed within the scope of the employment answers what was under discussion.

Tom Young

I was initially thinking Conversion in relation to this and the Johnson and Johnson case. I do however agree with Reloc8!

Victor

**cough** http://news.bbc.co.uk/2/hi/uk_news/england/southern_counties/5222074.stm **cough**

Wouldn't such a claim be akin to blaming a bank for a bank robbery? The employer has contracted the vending company to run a vending operation, not a faulty vending operation.

Reloc8

Just goes to show the cultural differences between UK & USA...not one mention of Doughnuts.

Perhaps we are closer to Boston than Berlin.

Shield

The legal argument ensued because the machine was located in a canteen, and the way fault logging usually worked was:

The machine swallow your cash and would not vend, or the coil would stop short of dispensing the product, or it would become snagged on the end of the coil. People would inform canteen staff, and they would log the fault with the supplier of the machine.

In this instance, the machine was vending too many items, and nobody said a word to the canteen staff.

The vending machine company were claiming that the employer should have known, or ought to have known that something was wrong because people were queueing up to use it, and were leaving with handfuls of stuff - all in plain view of canteen staff.

If nobody 'complained', a fault would not be logged and the company would not be contacted, so the question is - if the canteen staff knew of the fault, did they have an obligation to contact the vending machine company?

Victor

If the staff had a general supervisory responsibility and knew people were stealing, then there might be some responsibility. Theres a failure to report a crime.

My experience with vending machines has been more of the non-dispensing problem. Although once I bumped the machine for someone and a second bar of chocolate fell out. I made sure to be seen putting the bar back in.

Vending machines should have CCTV for such instances.

Our man in Havana

Did people who complained of non vending get refunds? My experience is that such complaints are not accepted/believed as a matter of course.

Tom Young

Victor wrote: »

Vending machines should have CCTV for such instances.

Yes, there would also be huge comedic value in having same live broadcasting on to the Internet. There is nothing more annoying that a vending machine purporting to deliver your craving food and then instead swallows the cash and winds the coil out to an inch of the confectionary sliding into the jaws of the delivery drawer.

It's like the opposite of Thierry Henry handling, I can't handle that at all!

Victor

Bond-007 wrote: »

Did people who complained of non vending get refunds? My experience is that such complaints are not accepted/believed as a matter of course.

Actually, I was there one day when the guy was filling the machine and I explained the situation and he gave me my bar of chocolate.

Realise that they are buying the chocolate for maybe 40c/bar and selling for 80-100c/bar, plenty of margin.