3. Negligence Flashcards
What is tort
Breach of a legal duty. There is no liability unless the law recognises that the duty exists.
What are the differences between contracts and tort
A contract doesn’t need to exist for a claim in tort to be successful.
Damages
Contract - Damages are intended to put the claimant back in the position he/she would have been in if the contract had been properly performed.
Tort - Damages are intended to put the claimant back in the position he/she would have been in had the tortious act never taken place.
Limitation periods
Contract - 6 years.
Tort - 6 years (cut down to 3 for personal injuries).
What conditions must be met to bring an action under tort
Act or Omission - Defendant does or does not do something they are legally supposed to do/not do.
Causation - Act or omission has to have directly caused loss or harm to the claimant.
Legal liability - The defendant owes the claimant a remedy.
What is negligence
Breach of a legal duty to take care.
What 3 elements must be proved to bring an action against the defendant for negligence
Duty of care - the claimant must prove the defendant had a duty to take care to not cause harm
Breach of duty - claimant must prove the defendant did not take reasonable care
Causation - the breach directly caused loss or damage
What is the neighbour principle
Everyone owes a duty of care to their neighbour. A neighbour is considered to be anyone closely linked to you that would reasonably foresee them as being directly affected by your actions.
What types of losses can a duty of care be given for
Physical harm - duty of care to not cause physical harm to one’s neighbour.
Financial losses due to physical harm - duty of care to not cause financial losses linked to physical harm.
Purely financial losses - where the claimant has only lost money, a duty of care can only be applied if there is a special relationship between the parties
What are the limits of the duty of care
Policy - Is it against public policy to apply the duty of care.
Foreseeability - was the damage suffered by the claimant reasonably foreseeable at the time of the defendants actions.
Fairness - courts will decide whether it is just and fair to give a duty of care in a particular situation.
Proximity - duty of care will only be recognised if there is sufficient proximity or closeness between the parties.
The claimant must prove what two things to successfully claim negligence
Duty of care existed
Duty was breached by the defendant
What is the principle of res ipsa loquitur and how does this apply to breach of duty of care
Means the facts speak for themselves. It applies to breach of duty of care as the fact that there is damage, proves there must have been negligence.
Where this is applied, it then becomes up to the defendant to prove they were not negligent.
What is the standard of care owed
The claimant must show that the defendant failed to take a degree of care which a reasonable person would have taken.
Note a reasonable person is not expected to be skilled in a professional or trade but if he/she acts is supposed to act in a professional activity then he/she must show care of a skilled person of that profession/trade.
What are the principles for assessing standard of care owed
Particular skill Emergency Advantage and risk Vulnerability Body of opinion Lack of hindsight Lack of skill
What does the principle of particular skill mean when assessing standard of care owed
If he/she has a particular skill then they will be judged as a reasonable man with that skill
What does the principle of Emergency mean when assessing standard of care owed
What would the reasonable man have done in the same emergency scenario
What does the principle of Advantage and Risk mean when assessing standard of care owed
Weighing up the risk and advantages of the scenario. If the risk outweighed the advantage gained then this would be a breach.
What does the principle of Vulnerability mean when assessing standard of care owed
Claimants are owed a higher standard of care where the defendant was aware of their particular vulnerability.
What does the principle of Body of Opinion mean when assessing standard of care owed
If the defendants action is considered to be reasonable by a body of professional opinion then this will not be a breach.
What does the principle of Lack of Hindsight mean when assessing standard of care owed
This focus’ on the defendants knowledge at the time, not knowledge or facts found at a later date.
What does the principle of Lack of Skill mean when assessing standard of care owed
Defendants level of skill is irrelevant. Inexperience is not an excuse for reduced lack of care.
In what two ways can a causal link between the defendants conduct and the damage which occured be determined
If the damage was caused directly due to the defendants act.
If the claimant would have suffered loss regardless of the defendants conduct.
When can there be damages awarded for a purely financial loss
Only when there is a special relationship. If there is no special relationship then no damages can be awarded.
When does a special relationship exist
When the defendant is in the business of giving professional advice.
Advice given in business context.
Defendant knew claimant would rely on the advice.
Do auditors owe a general duty to individual shareholders
No, they provide an annual audit report to the company as a whole not to each individual shareholder. However if a shareholder asks for specific advice there would be a duty of care to them for that advice.
What are the factors to consider in establishing whether a duty of care exists
Purpose - statement was made by a business of giving professional advice in a business context and was used as was intended.
Relationship - what is the relationship between the professional, recipient and third party. Will examine a relationship in light of the damage that occurred.
Responsibility - is there evidence that the professional had a perceived responsibility to the client.
Class - the class in which the claimant belongs (i.e. shareholders). Where a statement for general circulation has been made, this creates a different duty of care to where you create accounts for a known third party who is contemplating bidding to take over. There is a duty of care where it is reasonably foreseeable that a claimant that could be identified and not part of a large class would rely on the accounts.
Reliance - to what extent did a client rely on the statement and was that foreseeable. If the professional makes a negligent misstatement in knowledge or reasonable expectation that an identifiable person would rely on it, they are likely to be a duty of care to that person.
Fair and equitable - will it be against public policy to impose a duty of care on the professional.
