A company that operates points of sale of baked goods terminated the agreement with the shipping company and offset the entire debt in respect of the goods shipped after it discovered that an employee of the shipping company and its employee stole merchandise in an amount greater than the amount of the debt for the shipping services.
The Court held that an employer is generally liable for acts of theft of an employee in the event that the employer ratified the act of the employee or if the employee did the act while working and for the purposes of the employer. However, as in this case, there is no direct liability of the employer because the act was done by the employee for his own purposes and not for the benefit of the employer. An employer may also be responsible for the employee's actions due to negligence in supervising the employee, but negligence has not been proven in this case, and therefore the shipping company has no responsibility for the theft by its employee and it was not possible to offset the debt against it.