Buyers, Beware: The Florida Supreme Court’s Abrogation of the Apparent Authority Doctrine Leaves Plaintiffs Holding the Tab for Torts of Franchisees - Mobil Oil v. Bransford

Abstract

In Mobil Oil v. Bransford, the Florida Supreme Court effectively ruled that a franchisor cannot be held liable for the torts of a franchisee, despite a level of representation clearly adequate to warrant a jury trial on the issue of apparent ageny. The ruling virtually eliminated the doctrine of apparent authority as a means of imposing vicarious liability in the franchising industry. The author argues that the Florida Supreme Court's grant of summary judgment in Mobil Oil despite ample evidence of apparent authority will likely set precedent leading to inefficient economic results and inequitable decisions in future cases involving customers injured by the negligence of a business operator. The author recommends alternative approaches for developing a theory to better implement the policy goals behind vicarious liability in light of the commercial realities of the developing franchise industry.

Keywords: Mobil Oil v. Bransford, Florida, apparent authority, vicarious liability, franchises