Week 6 - Torts Lecture 1 PDF

z Law of Torts Why is understanding the law of Torts important for business? There are many risks in business where physical or property damage can occur for which the business may be liable. It is important to insure against those risks. The law of torts is about...

z Law of Torts Why is understanding the law of Torts important for business? There are many risks in business where physical or property damage can occur for which the business may be liable. It is important to insure against those risks. The law of torts is about the infringement of an individuals rights and the protection of those rights. z Insurance to cover litigation risks There are a number of different areas of risk that businesses face. Managers, accountants and company directors need to have insurance to cover these risks including: 1. Professional indemnity insurance 2. Public liability insurance 3. Workers compensation insurance 4. Business risk insurance z Types of tort actions Liability for the breach of duty to take reasonable care (negligence) Liability arising out of occupation or possession of property (occupiers liability and part of negligence as well as private nuisance) Direct interference with the person, property or goods of another (trespass) Liability for misrepresentations that affect a persons reputation and standing in the community (defamation), or which cause financial loss (negligent misrepresentation) Interference with contractual relationships (including breach of contract, conspiracy or intimidation) A fraudulent misrepresentation (if it does not form part of a contract, it may amount to the tort of deceit) Breach of statutory duty (involving motor traffic and work health and safety issues, and an action in its own right) z Tort definition Tort is a French word meaning: ‘Civil wrong’ A tort is an act or omission that causes loss, damage or injury to another individual, property, business or their economic interests Compensation is usually via monetary damages Torts are breaches of the civil law rather than the criminal law. Plaintiff and not the state brings an action Balance of probabilities Has to show loss suffered and entitled to a remedy z Distinguishing between tort law and criminal law Legal Criminal Law Tort Law Criterion Standard of Croewn must prove Plintiff must prove on balance proof beyond reasonable doubt of probabilities Sanctions and Focus is on punishing Focus on compensatring remedies offenders victims Consent Whether victim consents Injured party can consent to to the accused actions is defendants actions irrelevant Role of Crown Convicted person can be Croewn has no authority to pardoned pardon a tort (legislation) Promises Main concern is having Interests covered are wider, the promises of others covering both person performed Agreement Contractual duty mainly Tortious duty is imposed comes from agreement of independently of the consent the parties (can be of the parties imposed by law) z Distinguishing between tort law and contract law In tort law any rights or obligations between the parties are imposed by law and not by agreement and can only be enforced by an injured party. In contract law the rights and obligations between the parties are created through their agreement and are enforceable only by the parties to the contract. Tort law works in conjunction with contract law and statute law including the criminal law  In tort law there is a duty to exercise reasonable care and skill  There is also a contractual duty to exercise reasonable care and skill  Often a statute may also impose a duty to act with reasonable care and skill (e.g The Australian Consumer law Section 60) referring to services. z Time limitations to bring actions Unlike the criminal law, where there ar no time limits within which an action can be brought, there are statutory time restrictions with bringing a tort action. Personal injury/negligence 3 years all states Defamation 1 Year all states Other Torts 6 years all states  In all states, legislation known as ‘statutes of limitation’ determine when actions have to be commenced in time z Time limitations to bring actions Tort of negligence - time generally commences when the damage occurs. Wilson v Horne Aust Torts Reports 81- 504 The plaintiff suffered a sexual assault when she was twelve. When she was 25 she began to recall the assaults and suffered a stress disorder. The court found that trespass was statute barred by time elapsed, but as damage only recently arose, an action for negligence could occur.   See page 370 of text book z Defamation  The publication of material that harms someone's reputation  Cases on who is a publisher (not a search engine where just links to a site, case of Google v Detteros HCA However, compare case of Fairfax v Voller HCA 27 where it was held that a publisher can be liable for social media pages. Who can sue? Natural persons, small businesses less than 10 employees Also see “concerns notice” Large companies may have the tort of “Injurious Falsehood” as a remedyThis Photo by Unknown Author is licensed under CC BY-SA z What is the tort of negligence? Negligence generally means carelessness or thoughtlessness. However, these elements do not necessarily amount to negligence. As far as the law is concerned, a person is only liable for harm that is a forseeable consequence of their actions. (That is their failure to exercise reasonable care and skill, which carries legal consequences. The origins of negligence up until relevant statutory legislation were based in the common law and the case of Donoghue v Stevenson AC 562 z Negligence and business The legal principle of negligence was established Donoghue v Stevenson AC 562 and has been extended to cover many areas of negligence including: Defective products Defective structures Work Accidents Motor vehicle accidents Accidents on property Negligent statements z The elements of establishing negligence A plaintiff can only commence legal action where they can first establish that they suffered harm. The Plaintiff must establish (on the balance of probabilities) three things: 1. Does the defendant owe the plaintiff a duty of care? 2. If the defendant owes the plaintiff a duty of care, is the defendant in breach of that duty of care? (What is a reasonable standard of care?) 3. If breach is established, have the defendant’s actions caused the plaintiff to suffer loss or damage? Once the plaintiff has established duty, breach and damage the onus shifts to the defendant to establish one of the defences – contributory negligence, obvious risk or inherent risk, voluntary assumption of risk, dangerous recreational activity, exclusion of liability, illegality or inevitable accident. z The “reasonable person” standard The "reasonable person" standard in Australian tort law is an objective test used to determine whether a person's actions were negligent. It asks how a hypothetical reasonable person, placed in the same circumstances, would have acted. The test assesses whether the defendant failed to meet the standard of care expected in a particular situation. This standard is not influenced by somebody’s personal characteristics, such as inexperience or personal beliefs. Example: If a driver speeds through a school zone and hits a pedestrian, the court would assess whether a reasonable person would have driven more cautiously in that scenario. z Donoghue v Stevenson AC 562 The starting point for modern law of negligence was the decision in the case of Donoghue v Stevenson AC 562 In a 3:2 decision the court held that Donoghue was a neighbour to the manufacturer and bottler of ginger beer Stevenson, and one that a duty of care was owed because Stevenson should have reasonably foreseen that careless or negligent bottling could have harmed a consumer (not necessarily the purchaser). Lord Atkin said: ‘Your neighbour is any person who is so closely and directly affected by what you do (the idea of proximity) that you ought reasonably to have them in contemplation as being so affected when you are directing your mind to the acts or omissions which are called in question (the idea of reasonable foreseeability). z The foreseeability test Foreseeability is based on an objective test of whether a reasonable person would have foreseen that there was a real risk of the likelihood of injury to the plaintiff by taking into account all the circumstances of a particular case. Duty of care is one important test of foreseeability but there are other important considerations: Reliance of the plaintiff on the defendant Knowledge on the part of the defendant about the risk The vulnerability of the plaintiff to harm from from the conduct of the defendant Whether the defendant has the power to control the actions of another and is in a position to stop the harm from occurring. NOTE - The question to consider in all negligence cases is whether there was a real possibility that the defendants actions caused the harm to the plaintiff. z Step 1 – Duty of Care Whether a duty of care exists is a question of law based on the facts of the case with a focus on foreseeability of harm. There is a lot of established case law that a duty of care exists such as in the following relationships: Motorists owe a duty to other road users Boat captains owe a duty to their passengers Teachers owe a duty to their students Councils owe a duty to those who use their facilities Occupiers owe a duty to persons who come on to their property Professionals owe a duty to their clients Prison authorities owe a duty to their prisoners Employers owe a duty to their employee to maintain a safe system of work Manufacturers owe a duty of care to consumers even lifesavers owe a duty to swimmers who swim between the flags z Establishing a Duty of care To establish a duty of care one must consider: The particular risk of injury The relationship of the defendant to that risk The reliance on actions by the defendant Whether that reliance meant that the defendant should be protective of the plaintiff The nature of the damage suffered z Duty of care Swain v Waverley Municipal Council HCA 4 A swimmer was injured when he dived into a sand bar. Held that the council lifesavers had a duty of care to take reasonable care for the safety of users of the beach. Swimmers should have been warned of the sandbar danger and the flags moved to a safer part of the beach. It was a jury trial and they originally found the council acted unreasonably. The High Court stated that the facts found by the Jury could not be overturned on appeal even though it was a very broad interpretation of DUTY OF CARE z Omission to act At common law there will generally be no breach of duty where physical harm or loss arises as a result of a failure to act. Council of the shire of Sutherland v Heyman HCA 41 Judge Brennan – ‘A man on the beach is not legally bound to plunge into the sea when he can foresee that a swimmer might drown.’ However, there are many areas where there is a reliance by the plaintiff for the defendant to do something e.g. such as failing to signal in traffic, or failing to provide proper safety equipment, then those omissions will likely amount to negligence. Goldman v Hargrave 1AC 645 A case involving a burning tree stump from lightening that was not fully extinguished by a negligent farm owner and the subsequent fire burnt the farm next door and the farm owner was found guilty for negligence. z Omission to act Doctor and patient - A Doctor needs to advise patient of risks of an operation but the plaintiff has to prove that they would not have proceeded if they had known the risks School authorities - Have to show reasonable care while students are under their control E.g. if they do not supervise play areas the school may be liable if a student is injured. Local Authorities - where they know or should know of risks and if they do not act or use their power, then they will likely be found liable for negligence. Parramatta City Council v Lutz - derelict house and a fire after warnings by neighbour to council. Statutory Authorities - Electricity authorities (fires) or dam control (floods) if they fail to act then they are likely to be found liable in Negligence. Often can result in class actions against the authorities. z Immunity from liability for negligence - Public policy exemptions In Australia, certain public policy exemptions provide immunity from liability for negligence in specific situations. These exemptions are typically designed to balance individual rights with broader public interests. Some key exemptions include: Governmental and Statutory Authorities: Some government entities and statutory authorities are immune from liability when performing their statutory duties or powers, particularly when decisions involve matters of policy or discretion (e.g., road design, emergency services). Judicial Immunity: Judges and judicial officers are immune from liability for acts performed in their judicial capacity, ensuring they can make decisions without fear of personal liability. Parental Immunity: In some cases, parents may be immune from negligence claims brought by their children, especially regarding decisions related to upbringing and discipline. (Smith v Leurs HCA 27 – slingshot) Police Immunity: Police officers may be immune from negligence claims when acting in the course of their duties, particularly in complex operational decisions during law enforcement activities. z Immunity from liability for negligence - Public policy exemptions Volunteer Immunity: Volunteers working for non-profit organizations often have immunity from personal liability for negligence under certain conditions, provided they act in good faith and within the scope of their role. Emergency Services: Firefighters, paramedics, and other emergency responders may have immunity when responding to emergencies, especially if their actions are necessary to protect life and property, and provided they act without reckless disregard for safety. Military and Defence Immunity: Military personnel and the government may be immune from liability in cases involving acts of war, military service, or national defense. These public policy exemptions aim to ensure that individuals or entities carrying out essential public functions can do so without the constant fear of legal repercussions, as long as they act in good faith and within the scope of their responsibilities. z Step 2 - Has the defendant breached their Once a duty duty ofof care? care (were the is established they at fault?) plaintiff then has to prove that the defendant’s acts or omissions failed to meet the standard of care and therefore breached the duty of care. What standard of care is expected of a reasonable person? What would a reasonable person have done if they were in the defendants position? Is the standard of care flexible? The standard of care required in a particular case is a question of law for the judge to determine and will vary from case to case Was it an emergency? What was the age, experience, fitness, skill and knowledge of the defendant? Where older or younger people are involved the standard of care will be higher e.g. retirement homes or day care centres z What elements need to be established for a breach? Was there a breach of the duty of care? NSW – s.58 Civil Liability Act 2002; Victoria – s.48 Wrongs Act 1958; South Australia – s.32 Civil Liability Act 1936 Question 1 – Was the risk foreseeable? That is, was it a risk which the person knew or ought to have known about? Question 2 – Was the risk insignificant? Question 3 – In the circumstances, would a reasonable person in defendants position have taken precautions? The probability that harm would occur if care not taken Likely seriousness of the harm Burden of taking precautions to avoid the risk of harm Social utility of the activity that creates the harm Also see, NSW – s.5C Civil Liability Act 2002; Victoria – s.49 Wrongs Act 1958 Defendant has breached their duty of care to the plaintiff. Has plaintiff suffered damage? z Reasonable person - precautions The court will consider a number of things as to when and what type of precautions should be taken. The probability of harm occurring even if care and precautions had been taken. Bolton v Stone AC 850 The defendant was not liable for disregarding a slight risk of a person being hit by a cricket ball walking past a fenced ground. The seriousness of the harm has to be disclosed even if a remote chance of injury. Rogers v Whittaker HCA 58 The plaintiff had a 1:14,000 chance of blindness from an eye operation. The court considered that the result could be catastrophic and the plaintiff should have been warned of the risk even though it was low. The court found that a reasonable person in the doctors position would have told the plaintiff. z Reasonable person - precautions The burden and taking precautions to avoid the risks of harm. The magnitude of the risk, and the probability of injury have to be balanced against the expense, difficulty and inconvenience of any action necessary to reduce the risk. Woods v Muti Sport Holdings HCA 9 Woods suffered an eye injury playing indoor cricket. The court held that there was no duty to warn of obvious risks in recreational activities where participants are reasonably aware of potential dangers. This case established that individuals who voluntarily engage in sporting activities assume the inherent risks, limiting the liability of operators for injuries resulting from known risks associated with the sport. The social utility of the activity that caused the harm. Sports have health benefits and often are riskier. The courts have to balance these two factors. Waverley Council v Ferreira NSWCA 418 A 12yo boy died when he fell through an unprotected skylight. Council was aware that children were using a fence to climb onto the roof and the court found that it was reasonably foreseeable that a child may be seriously injured if they fell off, and a reasonable person would have taken precautions to avoid, or at least minimise the risk. z Other principles courts consider in determining liability The burden of taking precautions to avoid a risk of harm includes the burden and costs of taking precautions to avoid similar risks of harm for which the person may be responsible. The fact that a risk of harm could have been avoided by doing something in a different way does not itself give rise to liability – in other words, the burden of proof is on the plaintiff too prove that the method used was unreasonable in all the circumstances and that an alternative method existed that the defendant should have used. The subsequent taking of action that would, had the action been taken earlier, have avoided a risk of harm does not of itself give rise to an admission of liability. z Step 3 - Has the plaintiff suffered damage? Causation and scope of liability The onus of proof is on the plaintiff, who must show that any actual loss or actual damage is of a kind recognised by the law and was suffered as a result of the defendants breach of duty. The damage may be: Economic (e.g. lost or missed sales) To property (e.g. damage caused by faulty plumbing or electrical wiring) To the person (a broken arm or leg as a result of motor vehicle accident, psychological damage), as long as there is actual damage z Part 1 - The causal link between breach and damage? The plaintiff has to show that the defendants negligence was a necessary condition of the doctrine of the harm. Would the plaintiff have suffered this damage ‘but for’ the defendants negligence. Barnett v Chelsea and Kensington Hospital Management committee 1 QB 428 A doctor refused to examine a person who had consumed a drink of tea with arsenic. The failure to treat the patient was a clear breach of duty but the court found that the plaintiff would have died anyway, even with medical treatment. There was not the causal link between the breach and death. z Part 2 - Scope of liability test The second part to the damage question, that is scope of liability or remoteness requires the court to explain whether or not, and why responsibility for the harm should be imposed on the defendant. The scope of liability focuses on the foreseeability of the consequences and the plaintiff has to show that the damage was a foreseeable consequence of the negligence of the defendant. The Thistle Company of Australia Pty Ltd v Bretz QCA 6 – Bretz tripped and fell over a concrete base at a petrol bowser that had been rebuilt and blended in to the tarmac. Prior to the fall the manager at the service station had warned Thistle of the hazard but Thistle did nothing. The court held that the type of risk was foreseeable and found Thistle