Podcast
Questions and Answers
What is the primary focus of criminal law?
What is the primary focus of criminal law?
Civil law includes the assessment of criminal wrongs.
Civil law includes the assessment of criminal wrongs.
False
What are the two main categories of law discussed?
What are the two main categories of law discussed?
Criminal law and civil law
Actions that harm individuals or society can result in a legal wrong, categorized as either ______ or civil.
Actions that harm individuals or society can result in a legal wrong, categorized as either ______ or civil.
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Which of the following is NOT an example of a criminal wrong?
Which of the following is NOT an example of a criminal wrong?
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Match the types of legal actions with their definitions:
Match the types of legal actions with their definitions:
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Torts can be categorized into intentional and unintentional acts.
Torts can be categorized into intentional and unintentional acts.
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What is the purpose of tort law?
What is the purpose of tort law?
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Which of the following activities typically impose strict liability?
Which of the following activities typically impose strict liability?
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Strict liability can be applied without needing to prove negligence.
Strict liability can be applied without needing to prove negligence.
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What is the primary legal duty owed by occupiers to visitors?
What is the primary legal duty owed by occupiers to visitors?
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Occupiers are defined by __________, not ownership.
Occupiers are defined by __________, not ownership.
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Match the following actions with their corresponding liability exposure:
Match the following actions with their corresponding liability exposure:
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What kind of legal advice should brokers avoid giving to clients?
What kind of legal advice should brokers avoid giving to clients?
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Liability exposures only arise from activities conducted on the premises.
Liability exposures only arise from activities conducted on the premises.
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What should brokers do if they encounter unfamiliar risks?
What should brokers do if they encounter unfamiliar risks?
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What is the primary difference in duty of care owed to invitees compared to trespassers?
What is the primary difference in duty of care owed to invitees compared to trespassers?
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Occupiers’ Liability Acts were introduced in the early 1990s in several provinces.
Occupiers’ Liability Acts were introduced in the early 1990s in several provinces.
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What must brokers be aware of regarding occupiers' liability?
What must brokers be aware of regarding occupiers' liability?
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Independent contractors may assume liability depending on the __________.
Independent contractors may assume liability depending on the __________.
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Match the following scenarios with the appropriate liability outcomes:
Match the following scenarios with the appropriate liability outcomes:
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In which scenario might a landlord be liable for tenant or customer injuries?
In which scenario might a landlord be liable for tenant or customer injuries?
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Occupiers owe a duty of care to individuals outside the premises affected by their operations.
Occupiers owe a duty of care to individuals outside the premises affected by their operations.
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What is required for a plaintiff to show in a nuisance claim?
What is required for a plaintiff to show in a nuisance claim?
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What type of tort involves careless conduct leading to harm?
What type of tort involves careless conduct leading to harm?
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Statute law is created by federal and provincial governments and can reflect current societal values.
Statute law is created by federal and provincial governments and can reflect current societal values.
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What are the two categories of compensatory damages?
What are the two categories of compensatory damages?
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Breach of contract occurs when one party fails to fulfill their __________ to another party.
Breach of contract occurs when one party fails to fulfill their __________ to another party.
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Match the types of damages with their descriptions:
Match the types of damages with their descriptions:
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What can the injured party seek if there is a breach of contract?
What can the injured party seek if there is a breach of contract?
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Precedents can never be overturned as societal views evolve.
Precedents can never be overturned as societal views evolve.
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What is the primary purpose of damages in tort law?
What is the primary purpose of damages in tort law?
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What type of damages are awarded for pain and suffering?
What type of damages are awarded for pain and suffering?
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Nominal damages are awarded when there is a significant loss that has occurred.
Nominal damages are awarded when there is a significant loss that has occurred.
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What must be proven by the plaintiff to receive special damages?
What must be proven by the plaintiff to receive special damages?
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Exemplary or punitive damages are awarded to punish severe misconduct for __________.
Exemplary or punitive damages are awarded to punish severe misconduct for __________.
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Match the types of damages with their characteristics:
Match the types of damages with their characteristics:
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What is the typical award for nominal damages?
What is the typical award for nominal damages?
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Juries are responsible for determining matters of law in court cases.
Juries are responsible for determining matters of law in court cases.
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What is the primary purpose of exemplary or punitive damages?
What is the primary purpose of exemplary or punitive damages?
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Which of the following is NOT an example of common nuisance?
Which of the following is NOT an example of common nuisance?
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Trespass can occur if someone dumps waste on another's property.
Trespass can occur if someone dumps waste on another's property.
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What must happen for a products liability claim to be valid?
What must happen for a products liability claim to be valid?
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A product is deemed defective if it contains something ______.
A product is deemed defective if it contains something ______.
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Which of the following describes an express warranty?
Which of the following describes an express warranty?
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Match the legal terms with their definitions:
Match the legal terms with their definitions:
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Consumers can sue manufacturers for negligence due to product defects under new Canadian law.
Consumers can sue manufacturers for negligence due to product defects under new Canadian law.
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What landmark case expanded the rights of consumers to sue manufacturers for product defects?
What landmark case expanded the rights of consumers to sue manufacturers for product defects?
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Study Notes
CAIB 3: Chapter 1 Commercial Liability - A Legal Perspective
- This chapter covers commercial liability from a legal perspective.
- Canadians have legal rights protected and enforced by the state.
- Key legal rights include equality, language rights, personal privacy, protection of property, and freedom from physical injury.
- Invasion of legal rights is considered a wrong, categorized as either criminal or civil.
- Criminal law aims to protect society through punitive measures.
- Civil law addresses private disputes and typically seeks compensation for victims.
- Legal remedies are available when someone's rights are violated.
- Legal interpretations can vary by province; consultations with legal professionals are recommended.
Section 1: The Law - An Introduction
- Canadians have protected legal rights enforced by the state.
- Legal rights include equality, language rights, personal privacy, protection of property, and freedom from physical injury.
- The violation of legal rights is a legal wrong, classified as either criminal or civil.
Criminal Law - Overview and Key Principles
- Criminal wrongs are actions harmful to the state.
- The Canadian Criminal Code outlines criminal conduct and prescribes punishments.
- Examples of criminal wrongs include: dangerous driving, impaired driving, drug possession and trafficking, murder, theft, and other offenses.
Criminal Law - Prosecution and Punishment
- The state prosecutes individuals or entities that commit criminal acts.
- Criminal law prioritizes punishment over compensation for victims.
- Penalties may include fines, imprisonment, or other sanctions, and courts may also order victim compensation.
Civil Law – Understanding Private Rights and Remedies
- Civil law focuses on private rights and remedies, addressing disputes between individuals or organizations.
- It's also known as private law, contrasting with criminal law, which addresses offenses against society.
- Civil law incorporates tort law (wrongful actions) and contract law (breaches of agreements).
Tort Law – Purpose and Types of Torts
- Tort law allows victims to seek compensation for harm caused by others.
- Tort originally meant "wrong" or "injustice," referring to a civil wrong, not contract breach.
- Torts are categorized as either intentional or unintentional (negligent) acts.
Types of Torts – Intentional vs. Unintentional
- Intentional torts include assault, conversion of goods, and deceit.
- Unintentional torts (negligence) involve careless conduct resulting in financial loss or injury.
- Other torts include defamation, false arrest, nuisance, and trespass.
Contract Law – Understanding Breach of Contract
- Breach of contract occurs when a party fails to fulfill a promise or legal obligation without justification.
- Breaches occur when one party doesn't meet their contractual obligations, causing harm to the other party.
- Injured parties can seek court remedies like financial compensation or specific performance to address harm.
How Laws are Established - Common Law and the Rule of Precedent
- Canadian law is based on common law and statute law (except in Quebec).
- The rule of precedent in common law dictates that courts follow previous decisions in similar cases.
- Precedents can change as societal views and legal standards evolve.
Statute Law – The Role of Written Legislation
- Statute law comprises written laws created by federal and provincial governments.
- Statute law can supersede or amend common law to ensure laws reflect current societal values.
- Statutes can create new laws, consolidate existing ones, or replace outdated laws.
Damages in Tort – Overview and Purpose
- Damages in tort aim to compensate victims for losses caused by another party's actions.
- Courts award monetary compensation to address the harm suffered.
- Types of damages include compensatory, exemplary/punitive, and nominal damages.
Compensatory Damages – Bodily Injury Overview
- Compensatory damages cover actual injury and property damage.
- Bodily injury damages are categorized as general and special damages.
- General damages cover non-economic losses (e.g., pain and suffering).
- Special damages cover out-of-pocket expenses (e.g., medical expenses).
General Damages – Pecuniary and Non-Pecuniary Losses
- General damages address losses not easily quantified in money.
- Examples include pain and suffering, inconvenience, and future earnings.
- Such damages are awarded at the court's discretion, based on the injury's impact.
Special Damages – Out-of-Pocket Expenses
- Special damages cover quantifiable losses directly linked to the injury.
- Examples include medical expenses, nursing fees, travel costs, and loss of income.
- These damages must be itemized and proven by the plaintiff.
Property Damage – Measure of Loss
- Property damage awards are based on the loss in value resulting from the incident.
- Courts assess the difference in property value before and after the damage.
- Loss of use is also considered, covering costs of alternatives while property is restored.
Exemplary or Punitive Damages – Purpose and Conditions
- Exemplary or punitive damages are rare in Canada, awarded for severe misconduct.
- They punish the defendant for actions like malice, violence, or fraud.
- These damages aim to deter similar behavior by setting an example.
Nominal Damages – Establishing Legal Rights
- Nominal damages confirm a legal right when no significant loss has occurred.
- They are awarded when a legal principle or question is at stake, not for monetary compensation.
- Typical awards are minimal, such as $1.
How Damages Are Determined – Role of the Jury and Settlements
- Juries often determine the damages in court cases.
- Judges handle matters of law, while juries rule on facts and award sums.
- Many cases settle out of court, with settlements reflecting likely court outcomes.
Remedies for Breach of Contract
- Damages: Financial compensation to the injured party as if the contract was fulfilled.
- Specific Performance: Court enforces the fulfillment of the contract terms.
- Injunction and Rescission: Prohibits or compels actions, returning parties to their pre-contract positions.
The Broker's Role in Identifying Liability Exposures
- Brokers conduct surveys to identify potential liability exposures for businesses.
- A thorough survey helps identify risks that could lead to claims.
- Brokers require basic legal knowledge to understand relevant laws impacting clients.
Basis of Legal Action - Common Law and Negligence
- Businesses may cause injury or damage leading to liability claims.
- Liability can stem from common law or statute law.
- Negligence, a key tort in common law, requires proof of failing to exercise reasonable care.
- Proving negligence requires showing the defendant had a duty to exercise reasonable care, breached that duty by acting negligently, and the breach caused injury or loss to the plaintiff.
Duty of Care - The Defendant's Legal Obligation
- Duty of care is a legal obligation, not a moral one.
- No legal duty means no negligence; injury alone does not establish liability.
- Observing harm without intervention does not create a legal duty.
Breach of Duty – Failure to Meet the Standard of Care
- A breach of duty occurs when a defendant fails to meet the expected standard.
- The standard is based on what a reasonable person would do in similar circumstances.
- Negligence involves actions or failures to act that fall below this standard.
Damages and Proximate Cause in Negligence
- Proximate cause: Plaintiff must show damages resulted directly from the defendant's negligence; without the causation link there is no basis for a negligence claim.
- Actual damages are essential to establish a valid negligence claim.
Liability in Statute and Doctrine of Strict Liability
- Statute law imposes specific obligations on businesses to comply with safety and regulatory standards.
- Breach of statutory regulations can result in legal liability for business owners.
- Strict liability applies to extremely hazardous activities, where liability is assumed regardless of fault.
Strict Liability in Common Law
- Common law assumes most activities are safe if conducted with reasonable care.
- Inherently dangerous activities trigger strict liability regardless of precautions.
- Strict liability cases presume liability without proving negligence.
Strict Liability in Statute Law
- Statute law is a significant source of strict liability, usually involving fines and penalties.
- Federal and provincial statutes regulate activities high-risk to public safety.
- Statutory breaches leading to harm can incur fines and damages.
Activities Imposing Strict Liability and Limited Defenses
- Certain high-risk activities automatically impose strict liability on the person conducting them.
- Examples include explosives, fires, aircraft operations, and the use of dangerous substances.
- Defenses are restricted in strict liability cases, although applicable defenses exist in specific situations.
The Broker and the Law - Identifying Liability Exposures
- Basic legal knowledge helps brokers identify client liability exposures.
- Brokers should recommend insurance but avoid providing legal advice.
- Refer clients with specific legal questions to qualified legal practitioners.
Analyzing Liability Loss Exposures – Resources for Brokers
- This chapter provides an overview of liability exposures.
- Brokers seek guidance from senior producers or underwriters for unfamiliar risks, as liability exposures vary significantly.
- Thorough analysis of all liability exposures is essential.
Premises & Operations Liability Exposure
- Occupiers can be liable for injury or property damage to third parties on their premises.
- Liability arises from occupancy and activities conducted on the property.
- Occupiers (who control property) include owners, tenants, and those with supervisory control.
Duty Owed to Visitors - Premises and Operations
- Occupiers have a legal duty regarding both the condition of the premises and activities conducted on them.
- Premises exposure liability stems from unsafe property conditions.
- Operations exposure liability encompasses activities conducted on or off the premises.
Premises Exposure – Common Risks and Examples
- Premises conditions can lead to claims if they cause harm to visitors.
- Common hazards include loose railings, faulty stairwells, wet floors, uneven carpets, and poorly maintained sidewalks/exits.
Operations Exposure – On and Off-Premises Activities
- Operations exposure includes risks from business activities on-site and off-site.
- Examples of on-site risks include property damage from sparks during welding and injuries to customers from dropped items.
- Liability may be established under common law or statute law.
Liability in Common Law – Duty of Care Based on Visitor Status
- Duty of care in common law varies based on the visitor's purpose.
- A higher duty of care is owed to invitees (like customers) compared to trespassers.
- The level of responsibility reflects the occupier's obligation to ensure safety for lawful visitors.
Liability in Statute – Occupiers' Liability Acts
- Occupiers' Liability Acts replace common-law duties with clearly defined statutory obligations.
- These acts were introduced in the 1970s to 1980s in several provinces.
- Brokers must recognize provincial differences in these statutes.
Common Duty and Exceptions under Occupiers' Liability Acts
- Occupiers' Liability Acts establish a common duty of care regarding premises safety.
- The duty is to take reasonable care to ensure visitor safety on the premises.
- Exceptions exist for voluntarily assumed risks, like in sporting events or inherently risky circumstances.
Limited Liability of Occupiers – Overview
- Occupiers' liability can be restricted in specific cases.
- Independent contractors may assume liability, depending on circumstances.
- Brokers should understand situations where occupier liability is reduced or removed.
Liability for Independent Contractors
- Principals aren't liable for independent contractors' negligence if reasonable care is exercised in selecting the contractor and the work is deemed reasonable.
- Principals may share liability when work is inherently dangerous, using defective equipment provided by the principal, or if the principal controls the work process.
Liability for Rented Premises – Single Occupancy
- Landlords in single-occupancy buildings aren't typically liable for tenant or customer injuries.
- Exceptions include failing to disclose known hazards or neglecting repair duties after notice from the tenant.
Liability for Rented Premises – Multiple Occupancy
- Landlords of multiple-occupancy buildings have specific liability for common areas.
- Landlords are typically responsible for entrances, hallways, stairways, elevators, and roofs (in single-story buildings).
- Liability for issues within leased units typically falls on the tenant (occupier).
Duty Owed to Those Outside the Premises
- Occupiers owe a duty to individuals outside the premises affected by occupancy or operations.
- Premises must be maintained safely to prevent hazards to passersby.
- Examples include signs over public property, the presence of loose bricks, and protection from snow and ice hazards.
Liability for Nuisance
- Nuisance is an action disrupting others' comfort or use of their property.
- Plaintiffs must prove physical injury or significant interference, which was unreasonable.
- Common nuisance examples include smoke, odors, noise, and pollution.
Liability for Trespass
- Trespass is an unlawful interference with another's property.
- Examples include overhanging buildings, encroachment on a neighbor's land, and dumping waste on someone else's property.
Products Liability Exposure – Consumer Rights and Defective Products
- Consumers expect safe products, and defective products causing harm may lead to liability claims.
- Liability extends to anyone involved in selling the product.
- A product is defective if it has unintended components or lacks necessary safety features.
Establishing a Products Liability Claim – Requirements and Examples
- To file a products liability claim, the injury must occur away from the seller's premises after the seller has relinquished the product.
- Injuries on the seller's premises are generally considered premises liability claims, not product liability claims.
- Example: Illness from a food product consumed at home after purchase.
Liability in Contract – Sale of Goods Act and Warranties
- Sellers of goods may be liable under contract law through the Sale of Goods Act.
- Implied warranties, including fitness for a specific purpose when the buyer relies on the seller's expertise, are usually included in sales.
- Express warranties override implied warranties if stated in a contract.
Liability in Contract - Express Warranties and Limitations
- Advertising claims can create express warranties and liability if the claims are misleading.
- Only the contracting parties (buyer & seller) have the right to sue for breach of contract.
- Consumers generally lack a direct contractual claim against manufacturers but can sue sellers directly.
Action in Tort – Extending Liability to All Users
- Initially, only purchasers could sue manufacturers for product defects.
- Donoghue v. Stevenson expanded rights to all users of defective products.
- Canadian law recognizes this right, allowing consumers to sue manufacturers for negligence.
The Snail in the Bottle Case - Donoghue v. Stevenson (1932)
- Donoghue consumed tainted ginger beer, causing illness.
- Legal issue was a lack of a direct contract between the consumer and manufacturer.
- The court ruled manufacturers owe a duty to end users, setting a precedent for product liability to all users.
Burden of Proof – Shifting Responsibility to Manufacturers
- Historically, plaintiffs had to prove negligence to sue manufacturers for product defects.
- The burden now often shifts to manufacturers to demonstrate their lack of negligence.
- Manufacturers fulfill this by demonstrating reasonable precautions in product production and inspections.
Strict Liability – Provincial Legislation and Manufacturer Responsibility
- Some provinces mandate strict liability for defective products regardless of negligence from manufacturers.
- This reflects increasing product complexity and hidden dangers.
- Strict liability laws emphasize manufacturer responsibility for consumer safety.
Duties of Manufacturers – Ensuring Product Safety and Providing Warnings
- Manufacturers have a duty to ensure safe designs and manufacturing practices.
- Warning instructions are necessary to inform consumers of potential product dangers.
- Detailed product instructions are critical, especially when safe use requires specific guidance.
Duties of Sellers – Liability and Consumer Protection
- Sellers are considered experts and expected to provide accurate product information, making them liable for inaccurate or misleading information.
- Misrepresentation in sales can lead to liability due to deceit or breach of contract.
- Both retailers and manufacturers may face liability, as demonstrated through cases like Grant v. Australian Knitting Mills.
Completed Operations Liability Exposure – Overview and When an Operation is Complete
- Completed operations exposure occurs when faulty work causes harm after substantial completion of the work.
- Claims for completed operations can arise in contract or tort.
- Injury or damage off the worker's premises after completion or abandonment of the project may trigger liability claims.
Types of Losses from Completed Operations
- Defective work can result in bodily injuries or property damage.
- Loss of use, due to the work failing as intended, is also a potential loss.
- Examples include a failed heating system closing a business or malfunctioning gas pipes leading to explosions.
Common Claims in Completed Operations Liability
- Common claims related to completed operations liability include improper task performance, use of bad materials/parts, and failure to meet warranty promises.
- Businesses may avoid liability by withdrawing or repairing known defective work.
Personal Injury Liability Exposure
- Personal injury claims involve harm that is not physical, such as wrongful arrest, malicious prosecution, libel, slander, and actions causing mental or emotional distress.
- Damages in these cases often consider factors like reputation harm, economic loss, and emotional suffering.
- High-risk businesses include retailers with store security, landlords with wrongful property entry actions, and media outlets in libel/slander cases.
Liability for Property in Care, Custody, or Control – Overview
- Businesses might be liable for damage to other's property under their care, custody, or control.
- Real property liability often involves rented premises or fixed equipment.
- Personal property liability is applicable for temporary custodianship, as demonstrated in bailment situations.
Liability for Real Property – Rented Premises
- Businesses operating on leased premises may be liable for damage to the building or equipment.
- Lease agreements usually outline tenant liabilities.
- Absent a contract, common law principles typically determine liabilities.
Liability for Personal Property – Bailee for Hire
- Bailees (temporary custodians of property, often compensated) must exercise ordinary care, the type of care depending on the property's nature.
- Contractual agreements detail bailee responsibilities, which common-law may expand upon.
Employer's Liability for Torts of Employees
- Employers are typically liable for employee torts during the course of employment, regardless of whether the act was unauthorized.
- Exceptions exist for employee actions outside their duties (e.g., personal activities using company resources), when duties were delegated without consent, or when employee's actions were outside scope of responsibilities.
Employer's Liability for Injuries to Employees – Workers' Compensation
- Workers' Compensation laws provide no-fault benefits for work-related injuries.
- Employees covered by Workers' Compensation waive the right to directly sue their employers.
- Some occupations (e.g., farming, commercial fishing, clergy, foreign embassies) might be excluded from this compensation system.
Contingent Liability – Work by Non-Employees
- Contingent liability occurs when non-employees perform work leading to potential legal issues for the businesses involved.
- Subcontractors typically hold primary liability, although principals might also face legal costs in relevant claims.
Contingent Liability – Employees Working Out of Province
- Contingent liability might arise when employees work out of province, leading to situations beyond standard Workers' Compensation coverage.
- If an injury occurs, the employee can sue the employer since the out-of-province work may have fallen outside Workers' Compensation scope.
- Brokers should advise clients on potential out-of-province work coverage.
Contractual Liability Exposure
- Contractual liability arises from explicit agreement (contract terms).
- Common contracts, including construction contracts, purchase orders, and lease agreements, may incorporate clauses clarifying liability.
- In case of conflicting terms, statutory and common-law principles may also determine liability.
Automobile and Aircraft Liability Exposure
- Automobile liability covers situations where business operations use company- or non-company-owned vehicles.
- Aviation and boat/vessel liability is significant for businesses using these assets.
- Brokers assess both automobile and aviation/watercraft exposures during risk evaluation.
Pollution Liability Exposure
- Pollution liability refers to contaminating or harming the environment.
- High-risk industries (e.g., chemical plants, pulp mills, gas stations, meat processing) face amplified pollution liability risk.
- Environmental regulations can create significant financial burdens due to cleanup requirements.
Incidental Medical Malpractice Exposure
- Incidental medical malpractice liability arises when businesses offer limited medical services, such as on-site first aid.
- This is common in businesses such as manufacturing and food processing.
- Liability can result from inappropriate or omitted medical care by or on behalf of the on-site staff.
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This quiz explores the fundamental concepts of criminal law and tort law. It covers key definitions, types of legal actions, and the responsibilities of occupiers and brokers. Test your understanding of legal wrongs, liability, and the distinctions between criminal and civil law.
