Also known as:retain control · retaining control · retains control · reservation of control
Written by attorneys · grounded in primary & secondary sources — see below
2 senses
1
in tort law
Authority an employer maintains over a portion of an independent contractor's work. The retained authority creates direct liability for physical harm when the employer fails to exercise reasonable care in supervising that aspect of the work.
2
Sense 1
1
in tort law
Authority an employer maintains over a portion of an independent contractor's work. The retained authority creates direct liability for physical harm when the employer fails to exercise reasonable care in supervising that aspect of the work.
Examples5
Grand Jury Recording Access
Rebecca Ross, an assistant U.S. attorney, receives the sole copy of the grand jury transcript after the hearing ends. She stores the recording in a locked office file and refuses a defense request for access. The court later confirms that her office alone decides who may review or copy the material.
Trust Assets and Elective Share
Sense 2
2
in secured transactions
Continued authority a secured party holds over specified collateral. Perfection by control exists only while the secured party maintains that authority and lapses once control ends.
Examples1
Deposit Account Control Release
Rita Russell repays her line of credit to Rising Sun Electronics in full. She sends a signed demand asking the lender to release its control agreement with the depositary bank. The lender refuses to send the required release, leaving the bank obligated to follow the lender's prior instructions.
Continued authority a secured party holds over specified collateral. Perfection by control exists only while the secured party maintains that authority and lapses once control ends.
Each sense below has its own examples, sources, and questions.
Ralph Richardson funds a revocable trust with most of his assets and continues to withdraw and redeposit funds at will. After his death his surviving spouse claims the trust property for her elective share. The court examines whether his ongoing power to direct investments and distributions shows retained control that defeats the transfer.
In re Totten179 N.Y. 112, 71 N.E. 748 (1904)
Board Resistance to Merger
Rachel Ramirez and other directors reject a premium merger offer. They cite vague strategic concerns while evidence shows their primary goal is to keep their seats and compensation. Shareholders sue, alleging the board improperly used its retained authority to block the transaction for personal entrenchment.
Gantler v. Stephens965 A.2d 695, 708-09 (Del. 2009)
Right of Publicity Claim
Ruby Rivera, a human cannonball performer, objects when a television station broadcasts his entire act without consent. The station argues the performance occurred in a public place. The Court holds that Rivera's retained control over the commercial value of his act supports a right-of-publicity claim despite the public setting.
Zacchini v. Scripps-Howard Broadcasting Co.433 U.S. 562 (1977)
Tender Offer Standing
Rhea Reynolds, a competing bidder, sues to enjoin a target company's defensive tactics. The Supreme Court holds that an unsuccessful tender offeror lacks standing under the Williams Act because the statute protects investors, not rival bidders seeking to retain control of the acquisition process.
Piper v. Chris-Craft Industries, Inc.430 U.S. 1, 40 (1977)
Frequently Asked2
Does retained control create liability only when the employer directs the precise manner of the contractor's work?+
No. Liability arises when the employer retains authority over any part of the work whose negligent exercise causes harm. The control need not extend to every detail of performance.
Can a decedent's retained power to revoke a trust defeat a spouse's elective share claim?+
Yes. Courts treat the power to revoke or control distributions as evidence that the decedent never surrendered ownership, allowing the trust assets to be included in the elective estate.
1
When does a secured party's control over a deposit account end after the debt is paid?+
Control ends only after the secured party sends the depositary bank a signed release or pays the balance to the debtor. Mere repayment does not automatically terminate the control arrangement.
379 N.Y.S.2d 923 (Sur. 1975)Wills Trusts and Estates
…to time, opposes the basic relief demanded by the children and the Attorney-General, urging that the Marlborough respondents retain control of the estate paintings. The three petitioners allege and have sought to prove that the respondent executors Bernard J. Reis and Theodoros Stamos have each been involved in a conflict of…