10-1 chapter 10— torts in the business environment reed shedd pagnattaro morehead f i f t e e n t...
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Chapter 10—Torts in the Business Environment
REED SHEDDREED SHEDD PAGNATTARO PAGNATTARO MOREHEAD MOREHEAD
F I F T E E N T H E D I T I O NF I F T E E N T H E D I T I O N
TheThe Legal & Legal & RegulatoryRegulatory Environment of of BusinessBusiness
McGraw-Hill/IrwinCopyright © 2010 by The McGraw-Hill Companies, Inc. All rights
reserved.
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Learning Objectives To appreciate how tort law is related to property. To understand the three divisions of torts and to develop a theory of why torts are so divided. To be able to explain the elements of negligence and to relate these elements to the development of negligence law. To grasp why tort litigation is so controversial in society today. To be able to explain why some torts are also crimes.
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Tort
Tort lawlimits howpeople act
and use their resources
DefinitionDefinitionA civil wrong
other thanbreach ofcontract
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Categories Of Torts
Intentional NegligentStrict
Liability
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Intentional Torts
DeliberateAction
Causes INJURY
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Intentional Torts
Either:• Desire to bring about certain results• Results are substantially likely
DeliberateAction
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Intentional Torts Types
Assault & Battery
Infliction Of Mental Distress
Invasion Of Privacy
False Imprisonment & Malicious Prosecution
Trespass
Conversion
Defamation- Public Or Private Person
Fraud
Common Law Business Torts
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Common Law
Injurious Falsehood- Trade Disparagement
Intentional Interference With Contractual Relations
Business Torts
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Negligence
DefinitionUnreasonable behavior thatcauses injury.
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DD CC
AANegligence ‘A, B, Cs’
A
Duty
Of Care
+
Causation(Fact & Proximate)
+ Damages
BBBreachOf Duty(Unreasonable Behavior)
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Proximate Causation
Injury ‘in fact’ not sufficient Proximate cause = legal
cause
Was injury ‘foreseeable’ or reasonable to expect.
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Negligence Defenses
Assumption of Risk
(Plaintiff’s knowing and willing
undertaking of an activity)
Affirmative Defenses
Contributory Negligence (Plaintiff’s own fault)
( now offset by Comparative responsibility)
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Strict Liability In Tort Strict products liability-
unreasonably dangerous defective products Production defect Design defect Warning defect
Respondeat superior- scope of employment
Ultrahazardous activity
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Other Strict Liability Torts Dram Shop Acts – Tavern owner liable for
intoxicated patrons Common Carriers - Damage To Goods
Being Transported, except
Acts Of GodAction Of Alien Enemy
Order Of Public AuthorityInherent Nature Of GoodsMisconduct Of Shipper
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pop
QUIZpop
QUIZpoppop
QUIZQUIZBest Box Company advertises so effectively Best Box Company advertises so effectively that National Products, Inc. stops doing that National Products, Inc. stops doing business with Average Package Corp. Bestbusiness with Average Package Corp. Bestis liable for:is liable for:
a.a. AppropriationAppropriationb.b. Wrongful interference with a contractualWrongful interference with a contractual relationshiprelationshipc.c. Wrongful interference with a business Wrongful interference with a business relationshiprelationshipd.d.None of the aboveNone of the above
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think
TANKthink
TANKthinkthink
TANKTANK
Identify and describe the elements Identify and describe the elements of a cause of action based on of a cause of action based on
negligence.negligence.
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Compensatory Damages
Compensate Plaintiff For Injuries Suffered
Punitive Damages
Used To Punish Defendant
Types: Past/Future Medical Expense
Past/Future Economic Losses
Past/Future Pain Suffering
Calculation - Difficult
Negligent Behavior“Gross” or “Willful & Wanton”
Exemplary Damages
Damages
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Highest Jury Tort Awards
The Crucial Controversy In PersonalInjury Torts Is In The Area Of Damages.
$103Million $55
Million
Medical Malpractice Negligent Security
Defective Truck Transmission
$109Million
(2007)
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Alternatives To Tort System
Disadvantages Contingency fee Legal expenses Punitive damages Rarely cost-
effective
AlternativesAlternatives
• ArbitrationArbitration
• No-fault No-fault insuranceinsurance
• Workers’ Workers’ CompensationCompensation
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Workers’ Compensation Acts Protect Employees/Families From Job-
Related Risks Employer Acted Unreasonably Tests For Compensation
Injury Accidental Result Of Employment
Exclusive Remedy Rule
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think
TANKthink
TANKthinkthink
TANKTANKTelevision reporters get jobs at a local Television reporters get jobs at a local
grocery store by misrepresenting grocery store by misrepresenting information about themselves in order to information about themselves in order to do a story about the store’s alleged sale do a story about the store’s alleged sale
of out-of-date meat. Are the reporters liable?of out-of-date meat. Are the reporters liable?a.a. YesYesb.b. NoNo