tabl1710 lecture wk7 - introduction to tort law

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TABL 1710 BUSINESS AND THE LAW

Week 7Introduction to Tort Law

Lecturer: Dr Leela Cejnar

2015 The University of New South WalesSydney 2052 Australia

The original material prepared for this guide is copyright. Apart from fair dealing for the purposes of private study, research, criticism or review, as permitted under the Copyright Act, no part may be reproduced by any process without

written permission. Enquiries should be addressed to the Head of School, Taxation and Business Law, UNSW, Sydney

Reminders!

Major Assignment On Moodle Due Monday 4 May by 5pm (week 9) Online submission only Max 2000 words Worth 20 marks Must show evidence of research beyond readings on Moodle and

beyond the textbook Discussion Forum

One for each tutorial class Speak to your tutor if you need assistance about how to use this

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Todays lecture

What is a tort

Different types of torts

Duty of care/Standard of care/Breach of duty of care at common law

Duty of care/Standard of care/Breach of duty of care and Civil Liability Act 2002 (NSW)

Key sections of the Civil Liability Act 2002 (NSW)

Causation/Remoteness and proving negligence

Defences

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OverviewOn completion of this week in you should be able to:

9 Explain what is a tort9 Explain the different types of torts and the different

methods of categorising torts

9 Explain what is meant by duty of care/standard of care/breach of duty of care at common law and pursuant to key sections of the Civil Liability Act 2002 (NSW)

9 Explain what are causation and remoteness under the law of tort

9 Identify the main defences to torts

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What is a Tort?

Tort = French for wrong

In legal terms, a tort is a civil wrong

Wrongdoer = the tortfeasor

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Tort Law

The law of tort is an area of the law that often only becomes relevant to people and businesses after the happening of a loss-making event

This loss can be an economic or physical loss

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What is Tort Law about?

The law of torts concerns the obligations of persons:

to respect the safety, property, reputation and business and economic interests of their neighbours

as a matter of cause and effect and

as a duty to compensate for wrongfully caused harm after the fact

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The purpose of Tort Law

Enforces the DUTY OF CARE between people: Seeks to protect the rights of every individual These rights are given by both case law and statute (the Civil

Liability Acts)

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Where do you find Tort Law?

Common law Used to be almost exclusively part of the judge made law had

to look at principles derived from the cases

Statute law/legislation Now much of the judge made law is covered by the Civil

Liability Acts in each state

In this unit, we only look at the Civil Liability Act 2002 (NSW)

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Tort Law versus Contract Law

Contract law:

Concerned with having promises performed

Rights arise from agreement of the parties

Tort law

Duty arises independently of the consent of the parties

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Tort Law versus Criminal Law Criminal proceedings are brought in the name of the

government (the prosecution)

Tort proceedings are brought by the injured person as a private citizen

Aim of criminal law: punish the offender

Aim of tort law: compensate the victim

Tort law and criminal law may overlap

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Liability in Tort

Tort law is concerned with remedies and provides compensation for the injured party - usually damages and/or an injunction

The modern law of tort operates on the basis of remedies to persons for the harm suffered by the conduct of others

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Types of Torts Goods Detinue Conversion Trespass

Person Assault Battery Deceit Conspiracy Passing Off Wrongful Imprisonment Interference with Contract Defamation

Negligence (our focus in this course)

Nuisance

Breach of Statutory Duty

See Latimer at 4-020

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Tort Law: Negligence

Common law: starting with Donoghue v Stevenson

Statute law: Civil Liability Act 2002 (NSW)

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Growth in claims Damages for personal injuries becoming larger

multi-million dollar payouts.

Rising insurance premiums. Rising costs of premiums leading to rising costs of

providing professional services.

9 2001: Collapse of Australias 2nd largest general insurer (HIH Insurances Limited).

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Government Response: Enacted legislation

Recommendations to the Federal Government included: A national response to the crisis all states introduce a

single statute to apply to any claim for damages for personal injury or death caused by negligence

Limitation of liability in relation to the supply of dangerous recreational activities

A statutory cap on damages for economic and non-economic loss

Limitation on claims for domestic help and nervous shock Limitations on lawyers cut of the damages

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Government Response: Enacted legislation

Legislation passed throughout Australia

In 2002, NSW introduced the Civil Liability Act 2002(NSW)


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WHAT IS NEGLIGENCE?

Elements of an action based on negligence are:

1) Duty of care ( owed by the defendant to the plaintiff)2) Breach of duty (by the defendant not reaching the

standard of care expected of them)

3) Causation4) Remoteness (ie: damage caused by the defendants

breach of duty to the plaintiff and which is not too remote).If all these elements are present then ask whether the defendant can rely on any:

5) Defences

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(1) Is there a duty of care?

Common law

Donoghue v Stevenson:Snail in the bottle caseGrant v Australian Knitting Mills

Statute/Legislation

Civil Liability Act 2002 (NSW): s 5B(1)

See Latimer at 1-350 and 4-080

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Is there a duty of care?

Donoghue v Stevenson

Involved the following scenarios:

1. Supply of ginger beer to shopkeeper by manufacturer for payment

2. Sale of ginger beer to Donoghues friend for payment

3. Friend of Donoghue gift to Donoghue (No contract between Donoghue and anyone else, so no action lies in contract action in tort)


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Ratio decidendi of Donoghue v Stevenson.

A manufacturer of products, which he sells in such a form as to show that he intends them to reach the ultimate consumer in the form in which they left him with no reasonable possibility of intermediate examination,and with the knowledge that the absence of reasonable care in the preparation or putting up of the products will result in an injury to the consumers life or property, owes a duty to the consumer to take that reasonable care.


Test found in Donoghue v Stevenson

Established test for duty of care

Neighbour test: duty of care arises from the neighbour relationship between the parties

Neighbour is someone so closely connected to you that you should have realised they would be affected by your behaviour


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Neighbour test

The rule that you are to love your neighbour becomes in law, youmust not injure your neighbour; and the lawyers question, who is my neighbour? receives a restricted reply. You must take reasonable care to avoid acts or omissions which you can reasonably foreseewould be likely to injure your neighbour. Who, then, in law is my neighbour? The answer seems to be - persons who are so closely and directly affected by my act that I ought reasonably to have them in contemplation as being so affected when I am directing my mind to the acts or omissions which are called in question.

Lord Atkin in Donoghue v Stevenson [1932] AC 562

See Latimer at 4-080 24

Is there a duty of care?Grant v Australian Knitting Mills

Donoghue v Stevenson first followed in Australia in Grant v Australian Knitting Mills:

Manufacturers duty of care No possibility of intermediate examination


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Duty of Care

Key factors: Reasonable foreseeability

Neighbour relationship

Reasonable reliance

Knowledge of risk

Vulnerability of the plaintiff

Compassion does not create a duty of care


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Established Categories

Recognised duty of care (proximity of relationship) existsbetween:

Authorities (police, government, public bodies etc) and the public Builder and client Drivers and passengers/road users Manufacturers and consumers Suppliers and wholesalers/retailers Professional advisers (accountants, doctors, solicitors etc) and clients Occupier and visitor/tenant/trespassers


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Non-delegable duty

Non-delegable duty of care exists between:

Employer/employeeHospital/patientSchool authorities/studentsCommon wallsDangerous substancesLandlord and Tenant

Case: Northern Sandblasting Pty Ltd v HarrisSee Latimer at 4-091

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(2) Is there a breach of the duty of care?

Ask: What is the standard of care required? (Common law test)

reasonable care in all the circumstances ie: what would the ordinary, reasonable and prudent person

would have done in the same circumstances?


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Civil Liability Act 2002 (NSW) Section 5B(1)

Ask:- is the risk foreseeable?

- is the risk not insignificant?

- would a reasonable person in defendants position have taken precautions?


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Statute/Legislation:

Under s5B(1)(c) of the Civil Liability Act 2002 (NSW), whether a breach of duty has occurred is determined by asking:

Would a reasonable person in the persons position have takenprecautions?

To answer this question a court can consider the factors ins 5B(2)

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Factors in s 5B(2): Probability that the harm would occur if care were not

taken: s 5B(2)(a)

Likely seriousness of the harm s5B(2)(b) Burden of taking precautions to avoid the risk of harm

s 5B(2)(c)

Social utility of the activity that creates the risk of harm s 5B(2)(d)


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Probability of harm

Probability that the harm would occur if care werenot taken (s 5B(2)(a))

Case: Bolton v StoneSee Latimer at 4-100

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Seriousness of harm

Likely seriousness of the harm (s 5B(2)(b))

Case: Paris v Stepney Borough Council See Latimer at 4-100

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Burden of taking precautions

Burden of taking precautions to avoid the risk of harm: (s 5B(2)(c))

Cases: Romeo v Conservation Commission, Cole v South Tweed Heads Rugby Football Club


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Burden of taking precautions

Balance the extent of the harm (ie the size and probability

of harm) against the costs of taking preventative

measures

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Social utility of activity

Social utility* of the activity that creates the riskof harm (s 5B(2)(d))

Case: Agar v HydeSee Latimer at 4-092* Social utility means does the activity serve some sort of (social) purpose

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Standard of Care and Professionals

Standard of care for professionals: s 5O of Civil Liability Act 2002 (NSW)

To be discussed next week

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(3) Causation

Must be some causal connection between breach of duty of care and damage suffered Did the defendants conduct cause the plaintiffs injury?

But for test can be used to work out causation ie: without the defendants breach, the damage would not have

occurred

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(3) Causation

Cases:Lindeman Ltd v ColvinCork v Kirby MacLean LtdYates v Jones


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Causation and Civil Liability Act 2002 (NSW)

Need to prove:

Section 5D(1) (a):

Negligence was a necessary condition (result) of the occurrence of the harm (factual causation)

But for test can be used to establish factual causation

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(4) Remoteness

The defendant is not always liable for all the damage caused by their breach of duty

At common law, only FORESEEABLE damage is recoverable

Damages cannot be too remote

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(4) Remoteness

Need connection between breach of duty and damage: Was the damage the cause of the breach? Was the damage of such a kind that a reasonable person

would have foreseen?

Case: The Wagon Mound Cases (especially Wagon Mound No 1)


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Remoteness and Civil Liability Act 2002 (NSW)

The Civil Liability Act 2002 (NSW) does not specifically mention the word remoteness

In that Act, the test for remoteness is referred to as the Scope of Liability (s 5D)

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Proving Negligence

Burden of proof (onus) is on the person who suffered the damage

That person must establish that: he or she was owed a duty of care the duty was breached ( standard of care not reached) the breach caused the damage and the damage suffered was a foreseeable consequence of

that breach


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Defences to Negligence

Contributory negligence Voluntary assumption of risk Vicarious liability

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Contributory negligence Contributory negligence is the failure by the plaintiff to

take care for their own safety.

To be contributory the plaintiffs negligence must help cause the damage.

Damages are apportioned.

Cases: Imbree v McNeillySee Latimer at 4-100 Liftronic v UnverSee Latimer at 4-160

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Contributory negligence

Under the Civil Liability Act 2002 (NSW): The same principles apply to determining contributory

negligence as apply to determining negligence: s 5R(1)

Standard of care is that required of a reasonable person in the position of the plaintiff: s 5R(2)

Liability can be reduced by 100% thus defeating the claim for damages: s 5S

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Voluntary assumption of risk

There is a duty to warn a person of the risk Voluntary assumption of risk is a complete defence to

negligence claim

Difficult to establish in areas other than sport because the defendant must prove the plaintiff had: a precise knowledge of the risk; a full and free understanding and appreciation of the particular risk; and

voluntarily accepted the risk


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Voluntary assumption of risk

Under the Civil Liability Act 2002 (NSW), no liability for :

inherent risk (ie: something that cannot be avoided by reasonable care): s 5I

harm suffered from obvious risks of dangerous recreational activities: s 5L

harm suffered during recreational activity where warning was given by the defendant: s 5M

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Other exemptions under theCivil Liability Act 2002 (NSW)

Good Samaritans: s 57 No liability for a person who, in good faith and without

expectation of payment or reward, voluntarily assists a person who is apparently injured or at risk of being injured

Volunteers: s 61 A volunteer does not incur any personal liability when acting in

good faith in community work :

Organised by a community organisation;or As an office holder of a community organisation


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Reduced (limited) liability under the Civil Liability Act 2002 (NSW)

The Civil Liability Act 2002 (NSW) restricts negligence claims from peoplewho have been:

Involved in criminal activities

Under the influence of or using drugs, including alcohol (where they have contributed to the injury)

Giving professional advice (statutory standard of care, s 5O: to be discussed next week)

Statutory caps (maximum amounts) and thresholds (minimum requirements): On damages claims for personal injury

See Latimer at 4-095 51 5252

Vicarious Liability

Vicarious liability

Secondary liability: one person is responsible for the wrongful act of another person because of the legal relationship between them, even if the first person is not at fault

Types of relationships affected:Employer/employeePrincipal/agentPartnerships


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Vicarious Liability

Employer/employee

Employer is liable to third parties for acts of employees within the actual or apparent scope of employees authority

Employee may be personally liable for actions outside the scope of their authority

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Next week

Remedies in tort Damages Liability for economic loss Types of economic loss Negligent misstatement Standard of care for professionals

Read: Latimer Ch 4, 4-175 to 4-291

tabl1710 lecture wk7 - introduction to tort law

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