Lecture 3


BUSL250 Sem 1, 2012


2011 BUSL250 Sem 1. 2012 .DIVISION 3 Causation Step 3: Has the plaintiff suffered damage? Harm caused by breach Was the breach a necessary condition of the occurrence of harm? YES Is it appropriate for the scope of the defendant’s liability to extend to the harm? NO Harm was not caused by breach YES Harm was caused by breach NO Harm was not caused by breach 2 Source: James (2010: 172) amended by Verity Greenwood.

2012 . It is sufficient to show that the carelessness was a contributing cause along with other causes. either directly or indirectly. the harm suffered by X: : Yates v Jones [1990] Aust Torts Rep 81-009 : March v Stramare Pty Ltd (1991) CLR 506 : Chappell v. 3 BUSL250 Sem 1.FACTUAL CAUSATION Factual causation  X must establish that your careless act caused. Hart (1998) 195 CLR 232  It is not necessary that X establish that your carelessness was the sole cause of the harm.

Remoteness The court considers whether. 1) (1961) (see p. 187) 4 BUSL250 Sem 1. 2012 . — The Wagon Mound (No. and to what extent. the defendant should be responsible for the consequences of their conduct. It is a question of law and the test is whether a reasonable person could foresee such a happening.

Step 4 — Defences What defences will D raise? Two defences can be raised by a defendant and the burden of proof rests with them: 1. 2012 . Voluntary assumption of risk 2. Contributory negligence 5 BUSL250 Sem 1.

that he or she was not aware of the risk. on the balance of probabilities. a defence of voluntary assumption of risk is raised by the defendant and the risk is an obvious risk. 6 BUSL250 Sem 1.o DIVISION 4: Assumption of Risk o ss. 2012 . 5F-5G If in action for damages for breach of duty causing harm. the plaintiff is taken to have been aware of the risk unless the plaintiff proves.

2012 .OTHER MATTERS TO BE CONSIDERED Section 5F-5I : Assumption of risk • Meaning of “obvious risk” (5F) • No proactive duty to warn of obvious risk (5H) : Mulligan v Coffs Harbour City Council [2005] HCA 63. • Duty to warn of ‘material risks’ inherent : Rogers v Whittaker (1992) 175 CLR 479 • Plaintiff must have accepted the precise risk : Rootes v Shelton (1967) 116 CLR 383 7 BUSL250 Sem 1.

2012 8 .DIVISION 5 : Recreational Activities • This Division applies only in respect of liability in negligence for harm to a person (the plaintiff) resulting from a recreational activity engaged in by the plaintiff This Division does not limit the operation of Division 4 in respect of a recreational activity If the plaintiff suffers harm as a result of engaging in a dangerous recreational activity they are assumed to have been aware of the risk : Agar v Hyde [2000] HCA 41 • BUSL250 Sem 1.

BC9604688) 9 BUSL250 Sem 1. NSWCA. 2012 . 1996.DIVISION 8: Contributory Negligence o  Partial defence : Ingram v Britten [1994] Aust Torts Rep 81-291  Standard of care : Mc Hale v Watson (1966) 115 CLR 199  Plaintiff could be found completely responsible for their own loss or injury  Intoxication: presumption of contributory negligence : Insurance Commissioner v Joyce (1948) 77 CLR 39 : Norris v Blake (Unreported.

Damages What will the plaintiff recover? Contributory negligence Yes Voluntary assumption of risk Where there are no defences Yes Defendant's damages reduced Proportionately (Under CLA up to 100%) Total defence. 2011:191 BUSL250 Sem 1. 2012 10 . Plaintiff does not recover anything Plaintiff recovers the full amount Source: Gibson & Fraser.

2012 11 .o DIVISION 6 : Professional Negligence  Standard of care at common law  Standard of care under Civil Liability Act 2002  Peer Professional Standards  Peer Professional Opinion defence : Dobler v Kenneth Halverson & Ors [2007] NSWCA 335 BUSL250 Sem 1.

Occupier’s liability  An occupier of premises owes a duty of care to all persons entering the premises to ensure that the premises are safe: . 2012 12 .Consolidated Broken Hill Ltd v Edwards [2005] NSWCA 380  Do you also owe a duty of care to people who are on your premises without your permission? .Phillips v Daly [1989] Aust Torts Reports 80-234 .Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479 .Hackshaw v Shaw (1984) 155 CLR 614 BUSL250 Sem 1.

2012 .Non-delegable duties Non-delegable duties & strict liability  A non-delegable duty of care includes: Employer – employee relationship Landlord – tenant relationship Hospital – patient relationship Teacher – pupil relationship The rule in Rylands v Fletcher 13 BUSL250 Sem 1.

DIVISION 7: Non-delegable duties Non-delegable duty of care: .a duty of care that cannot be delegated or passed on to another person Kondis v State Transport Authority (1984) 154 CLR 672 Burnie Port Authority v General Jones Pty Ltd (1994) ALJR 331 See also: Northern Sandblasting Pty Ltd v Harris (1997) and Leichardt Municipal Council v Montgomery (2007) BUSL250 Sem 1. 2012 14 .

2012 15 .DIVISION 7 : Vicarious Liability • A form of strict liability where one person is held liable for the wrongdoing of another : Century Insurance Co Ltd v Northern Ireland Road Transport Board [1942] AC 509) • An employer who is vicariously liable may have an action against the negligent employee for breach of a term of their contract of employment: Lister v Romford Ice & Cold Storage (1957) • Arises most frequently within the relationship of employer and employee Deatons Pty Ltd v Flew (1949) 79 CLR 370 • Employees versus independent contractors : control test Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 • Organisation (multi-facet) test : Hollis v Vabu Pty Ltd [2001] HCA 44 BUSL250 Sem 1.

3. 2012 16 .NEGLIGENT MISSTATEMENT In cases of pure economic loss the law has additional requirements: 1. A duty of care will not arise where it is not reasonable for the plaintiff to rely on the statement: : San Sebastian Pty Ltd v The Minister Administering Environmental Planning and Assessment Act [1986] HCA 68 Plaintiff must prove existence of a “special relationship” between the Defendant and the Plaintiff (proximity) : Hedley Byrne & Co Ltd v Heller & Partners [1964] AC 465 : Rentokil Pty Ltd v Channon [1990] Aust Torts Reports 81-019 2. An inadequate response can amount to a negligent misrepresentation if it is relied upon by the plaintiff: Pyrenees Shire Council v Day (1998) BUSL250 Sem 1. To establish duty of care. reasonable foreseeability of harm to a plaintiff is not enough.

DUTY OF CARE AND SPECIAL RELATIONSHIP To establish that a “special relationship” exists there are two major requirements: • Assumption of responsibility by defendant : Shaddock & Associates Pty Ltd v Parramatta City Council [1981] HCA 59 • Reasonable reliance by plaintiff BUSL250 Sem 1. 2012 17 .

the recipient of the advice can also rely on Australian Consumer Law BUSL250 Sem 1. .TEST FOR AUDITORS DUTY TO THIRD PARTIES  In order to establish a duty of care to third parties for statements made by auditors.would be used to induce the third party to act in reliance on the advice and . the Plaintiff must prove that the Defendant knew or ought to have known (objective test) that the statement: . 2012 18 .that if advice is incorrect.would be communicated to a third party. the third party risks suffering loss by relying on it when making their decision Esanda Finance Corporation Ltd v Peat Marwick Hungerfords [1997] HCA 8 AWA v Daniels t/a Deloitte Haskins & Sells (No 2) (1992) 10 ACLC 933  When seeking a remedy for negligent advice given in trade or commerce.

Next week Business Related Torts Reading: Chapter 10 BUSL250 Sem 1. 2012 19 .

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