Understanding The Nature Of The Law Of Tort (C4)

Question 1

Q: What is a tort?

Answer 1

A: A tort is a breach of a legal duty, and liability only arises if the law recognizes the duty exists.

Question 2

Q: Do parties need a prior relationship for a tort claim?

Answer 2

A: No, a tort claim does not require a prior relationship between parties, unlike a contract claim.

Question 3

Q: How do damages differ between contract and tort claims?

Answer 3

A: Contract damages aim to put the claimant in the position as if the contract was performed; tort damages aim to restore the position as if the tortious act hadn’t occurred.

Question 4

Q: What is the limitation period for contract claims?

Answer 4

A: The limitation period for contract claims is six years from the breach.

Question 5

Q: What are the limitation periods for tort claims?

Answer 5

A: Generally six years, but only three years for personal injury cases.

Question 6

Q: What must be proven for a tort claim to be successful?

Answer 6

A: There must be an act or omission by the defendant, direct causation of damage or injury, and legal liability.

Question 7

Q: What does “too remote” mean in tort law?

Answer 7

A: Damage or loss claimed must be a direct consequence of the defendant’s actions or inactions, not “too remote.”

Question 8

Q: What is the definition of negligence?

Answer 8

A: Negligence is a breach of a legal duty to take care, resulting in damage to another.

Question 9

Q: What must a claimant prove for a successful negligence claim?

Answer 9

A: The claimant must prove:
• A duty of care was owed by the defendant.
• The defendant breached this duty.
• Damage or loss was caused as a result of the breach.

Question 10

Q: What is the Duty of Care Principle?

Answer 10

A: There is a duty to take reasonable care to avoid foreseeable harm to others.

Question 11

Q: What is the Neighbour Principle?

Answer 11

A: Established in Donoghue v Stevenson, it expanded duty of care to people with no contractual relationship, meaning manufacturers owe a duty of care to end consumers.

Question 12

Q: How was the principle of Economic Loss established in negligence law?

Answer 12

A: Initially, only physical damage claims were allowed, but Hedley Byrne v Heller allowed claims for financial loss if a “special relationship” existed.

Question 13

Q: What are the Duty of Care tests from The Nicholas H case?

Answer 13

A: To establish duty of care, consider:
1. Was the damage foreseeable?
2. Is there sufficient proximity between parties?
3. Is it fair and reasonable to impose a duty of care?
4. Are there public policy reasons against a duty of care?

Question 14

Q: How is a breach of duty of care determined?

Answer 14

A: The claimant must show that the duty of care was breached by the defendant.

Question 15

Q: What is Res Ipsa Loquitur?

Answer 15

A: It’s a principle where harm itself implies negligence, shifting the burden of proof to the defendant if:
• The defendant had exclusive control over the cause of the harm.
• The incident would not normally happen without negligence.
• The claimant did not contribute to the accident.

Question 16

Q: What standard of care is expected in negligence cases?

Answer 16

A: The “reasonable person” standard, meaning a professional must show the care expected in their field, regardless of experience or training level.

Question 17

Q: What factors influence the standard of care?

Answer 17

A: Factors include:
• Professional body of opinion.
• Risk versus benefit of actions.
• Emergencies.
• Vulnerability of the claimant.

Question 18

Q: What must the claimant prove regarding loss caused by the breach?

Answer 18

A: The claimant must prove that loss or damage was directly caused by the breach.

Question 19

Q: What types of losses are recoverable in negligence cases?

Answer 19

A: Recoverable losses include:
• Personal injury-related losses.
• Property damage.
• Financial losses directly tied to personal injury (e.g., lost wages).
• Pure financial loss is rarely recoverable.

Question 20

Q: What does “remoteness” mean in negligence cases?

Answer 20

A: Even if a breach caused loss, recovery may be denied if the loss is deemed “too remote” from the breach.

Question 21

Q: Is there a distinction between liability from negligent misstatements and negligent acts in legal practice?

Answer 21

A: No, there is no distinction. A party can suffer damage from incorrect advice just as they could from negligent conduct, but negligent misstatements can have far-reaching consequences.

Question 22

Q: What did Hedley Byrne v Heller (1963) establish in relation to negligent misstatements?

Answer 22

A: It established that a duty of care can arise from negligent misstatements causing economic loss if there is a “special relationship” between the parties.

Question 23

Q: What must be present for a successful negligent misstatement claim?

Answer 23

A: A “special relationship” must be present, based on three factors:
1. The defendant is in the business of offering professional advice.
2. The advice was given in a business context.
3. The defendant knew or should have known that the claimant would rely on the advice.

Question 24

Q: What happens if there is no special relationship in a negligent misstatement case?

Answer 24

A: No duty of care exists. For example, auditors generally owe a duty to shareholders as a whole, not individual bidders, unless they knew the statement would be relied upon.

Question 25

Q: What was the significance of Caparo Industries v Dickman (1990)?

Answer 25

A: It clarified that auditors do not owe a duty of care to the public or individual shareholders purchasing shares based on audited accounts, unless the advice was specifically prepared for a particular purpose.

Question 26

Q: What criteria did the Caparo case set out to determine whether a duty of care exists?

Answer 26

A:
1. Foreseeability: Harm should be foreseeable.
2. Proximity: The statement must be communicated to a specific group or individual.
3. Just and equitable: It must be fair to impose a duty of care.

Question 27

Q: What factors are considered in establishing a duty of care in negligent misstatement cases?

Answer 27

A:
1. Purpose of the statement.
2. Skill expected of the professional.
3. State of knowledge at the time.
4. Responsibility to the claimant.
5. Type of claimant (e.g., shareholders).
6. Extent of reliance on the advice.
7. Foreseeability of reliance.
8. Fairness of imposing a duty of care.

Question 28

Q: What does S.507 of the Companies Act 2006 state regarding auditor liability?

Answer 28

A: Auditors can be penalized for recklessly providing misleading reports, punishable by a fine.

Question 29

Q: What restrictions are placed on indemnifying auditors under the Companies Act 2006?

Answer 29

A: S.532 prohibits indemnifying auditors for misleading reports, but S.534 allows auditors to enter liability limitation agreements with the company under certain conditions.

Question 30

Q: What are the conditions for auditors to enter into a liability limitation agreement under S.534 of the Companies Act 2006?

Answer 30

A: The agreement must be:
1. Approved by company members.
2. Limited to one year.
3. Liability limited to an amount considered “just and reasonable.”

Question 31

Q: What is the principal remedy in a negligence case?

Answer 31

A: The principal remedy in negligence cases is an award of damages.

Question 32

Q: What is required for the defendant to be liable in negligence?

Answer 32

A: The damage must be of a type that is “reasonably foreseeable.”

Question 33

Q: Does the defendant’s inability to foresee the cause or severity of the damage affect their liability?

Answer 33

A: No, it is irrelevant if the defendant could not foresee the cause or severity of the damage.

Question 34

Q: What is the defence of contributory negligence?

Answer 34

A: Contributory negligence occurs when the claimant is partly responsible for their injuries, leading to a reduction in damages based on their degree of responsibility.

Question 35

Q: In which types of cases is contributory negligence commonly seen?

Answer 35

A: Contributory negligence is often seen in road accident cases, such as when a claimant was not wearing a seat belt or crash helmet.

Question 36

Q: What does the defence of volenti non fit injuria mean?

Answer 36

A: It means that if the claimant has freely consented to the risk of harm, the defendant is exempt from a duty of care.

Question 37

Q: Is knowledge of the risk enough to invoke the defence of volenti non fit injuria?

Answer 37

A: No, the claimant must have actively consented to waive their right to legal redress, not just be aware of the risk.

Question 38

Q: What is an exclusion clause in the context of negligence?

Answer 38

A: An exclusion clause is a provision within a contract that seeks to exclude or limit liability for negligence.

Question 39

Q: Under what act can an exclusion clause be valid in limiting liability for negligence?

Answer 39

A: An exclusion clause may be valid under the Unfair Contract Terms Act 1977.

Question 40

Q: What is meant by an “act of God” in negligence cases?

Answer 40

A: An “act of God” refers to an event beyond human foresight, which could exclude liability if the defendant could not have reasonably anticipated it.

Question 41

Q: Under the Unfair Contract Terms Act 1977 (UCTA), what happens to a clause that seeks to exclude or limit liability for death or personal injury caused by negligence?

Answer 41

A: Under UCTA, any clause that seeks to exclude or limit liability for death or personal injury caused by negligence is automatically void. This means no exclusion clause can remove or limit liability for these types of harm.

Question 42

Q: What is vicarious liability?

Answer 42

A: Vicarious liability is when one party (usually an employer) is held responsible for the torts committed by another party (usually an employee), if the tort was committed during the course of employment.

Question 43

Q: Why is vicarious liability beneficial for claimants?

Answer 43

A: It is beneficial because employers typically have insurance to cover damages, making it easier for claimants to recover losses. However, claimants can still sue the employee directly, although they may not have the financial means to pay damages.

Question 44

Q: Can an employer be liable for torts committed by agency workers?

Answer 44

A: Yes, an employer can be vicariously liable for torts committed by agency workers if they are acting in the capacity of an employee.

Question 45

Q: When is an employer liable for torts committed by an employee?

Answer 45

A: An employer is liable only if the tort was committed during the course of employment.

Question 46

Q: What is the significance of the Lister and Others v Hesley Hall Ltd (2001) case?

Answer 46

A: The case clarified that an employer can be liable for an employee’s actions, even if those actions (such as abuse) are outside of what is typically expected in the job, as long as they occurred during employment.

Question 47

Q: What did the Dubai Aluminium Co Ltd v Salaam (2002) case establish?

Answer 47

A: The case established that employers can be vicariously liable for an employee’s fraudulent actions, as long as they fall within the usual scope of the employee’s work.

Question 48

Q: Can a principal be vicariously liable for an agent’s tort?

Answer 48

A: Yes, a principal can be vicariously liable for a tort committed by an agent, provided the agent was acting within their authority and performing tasks for which they were appointed.