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当前位置:中博教育 > ACCA > 学习指导 > ACCA LW考点:Key aspects of the tort of negligence

ACCA LW考点:Key aspects of the tort of negligence

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发布时间:2021-08-09 15:01

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Key aspects of the tort of negligence

Negligence–the relationship between the parties

Negligence cases are based on a non-contractual relationship between the parties.The parties may be known to each other,as with a surgeon and a patient,or they may be strangers,as with two drivers involved in a road traffic accident.Due to the lack of any agreed relationship between the parties,the first question that arises in the case of negligence is that of whether any relationship exists between them at all.If one party is to be held liable to another in negligence,the relationship that must first be established is that of a duty of care.

Exam answers often state as a learned fact that liability in negligence is non-contractual,but it is worth spending a little longer thinking about what it actually means.As a future accountant,you may find it helpful to relate this point to professional negligence cases since these illustrate the extent to which an accountant may be held liable in relationships where there may be no contractual obligation.点击免费下载>>>更多ACCA学习相关资料

A useful case in this respect is Caparo Industries plc v Dickman(1990).Here,the claimants were shareholders in a company and the defendants were the company’s auditors.The claimants relied on the audited accounts and purchased more shares with a view to making a takeover bid.Having taken over the company,the claimants discovered that the company had in fact made a£400,000 loss rather than the£1.2m profit shown by the financial statements.The House of Lords held that the requirements for a duty of care to exist were as follows:

the harm must be reasonably foreseeable

there must be proximity between the claimant and the defendant

it must be just,fair and reasonable to impose a duty of care on the defendant.

Note that foreseeability at this stage in the context of negligence is used to establish whether there is any relationship between the parties;this is not necessary at this stage in contract since the contract itself establishes that there is a relationship.(We will consider foreseeability again in relation to remoteness of damage,which is discussed below.)

In Caparo,the contract was between the company and the auditors.The individual shareholders did not have a contract with the auditors.The question was whether the auditors owed a duty of care to the shareholders.The House of Lords held that the auditors owed a duty to the shareholders as a body,but that they did not owe a duty to potential investors or to existing shareholders who planned to increase their shareholding.The defendants were therefore not liable.

Caparo is one of a number of cases considering professional negligence.(This is covered by syllabus area B5 of LW-ENG.)A key theme running through these cases is the existence of the so-called‘special relationship’.This was first established in Hedley Byrne&Co Ltd v Heller and Partners(1963).Bear in mind that the question of a special relationship is likely to be relevant where the claimant does not have a contractual relationship with the professional providing the advice.

In Hedley Byrne itself,the claimant provided services on credit to a client.It did so on the basis of a credit reference given by the defendant,the client’s bank.Note that there was a contract between the claimant and the client and a contract between the client and the bank,but no contract between the claimant and the bank.The defendant was able to avoid liability by relying on an exclusion clause contained in the credit reference.However,had the clause not been present,the defendant would have been liable because it had used its special skill to provide a statement to the claimant in the knowledge that the claimant would rely on this.

Other cases that you may find helpful to consider in this context are as follows:

JEB Fasteners Ltd v Marks,Bloom&Co(1982)

Morgan Crucible v Hill Samuel Bank Ltd(1991)

James McNaghten Paper Group Ltd v Hicks Anderson&Co(1991)

ADT v BDO Binder Hamlyn(1995)

NRG v Bacon&Woodrow and Ernst&Young(1996)

In each case,identify any contractual relationships between the various parties involved and the nature of the relationship between the claimant and the defendant.

Negligence–the nature of the obligation

In relation to negligence,the nature of the obligation is not agreed between the parties but rather is imposed by operation of law.For example,a road user will owe a duty of care to other road users and a manufacturer will owe a duty of care to the final consumers of its products.Once a duty of care has been held to exist,the defendant’s actions are judged by the standard of the reasonable man in the defendant’s position:Blyth v Birmingham Water Works(1856).The standard of care for professionals is of the reasonable professional having or holding himself out as having the skill or ability in question.Learners and the inexperienced will also be judged against the standards of the fully-qualified.

Negligence–causation and remoteness of damage

In relation to negligence,issues of causation and remoteness tend to be considered separately.The key test for causation is known as the‘but for’test,which basically asks whether the loss would have been sustained‘but for’the defendant’s negligence.The leading case here is Barnett v Chelsea and Kensington HMC(1969).The claimant arrived at the hospital emergency department complaining of stomach pains.He was sent home without being examined and subsequently died.Even though the doctor owed the patient a duty of care and had breached the duty,the breach of duty had not caused the patient’s death,since the poisoning was so advanced by the time the patient arrived at the hospital that he could not have been saved even with prompt treatment.The defendant was therefore not liable.

The key test for remoteness in negligence is one of foreseeability.In The Wagon Mound(1961),the defendants negligently allowed oil to spill into Sydney Harbour.The claimants were welding,but ceased doing so on seeing the oil.Having been advised that the sparks would not ignite oil lying on the surface of the water,they resumed work.Sparks ignited debris lying on the surface of the oil,which in turn ignited and damaged the claimants’wharf.It was held that the defendants were not liable since the only foreseeable damage was pollution rather than fire.By contrast,in Jolley v London Borough of Sutton(2000),a local authority failed to remove an abandoned boat for two years.A 14 year-old was seriously injured when he tried to jack up the boat in order to repair it.The authority was found liable since it knew that children regularly played on the boat,so it was foreseeable that a child would be injured.It did not matter that the precise nature of the injury could not be foreseen.The cases may appear to conflict,since The Wagon Mound focuses on foreseeability of the type of damage whereas Jolley v Sutton focuses on foreseeability of some harm.There are a number of cases in this area and they are not always easy to reconcile.For the purposes of Corporate and Business Law,the key point to remember is that the test for remoteness in the tort of negligence is based on foreseeability of harm.You should be prepared to illustrate this point with examples.

Note that the law of negligence considers foreseeability twice:once in relation to duty of care and again in relation to remoteness.Remember that,if there is no duty of care,the question of remoteness does not arise.Caparo v Dickman is a useful illustration of this:it might be foreseeable that existing shareholders would rely on an audit report in deciding whether to increase their shareholding.Nevertheless,the auditor did not owe a duty of care to potential investors.This was based on other aspects of the duty test:proximity and the question of whether it was fair,just and reasonable to impose a duty.

Negligence–the measure of damages

As with contract,once liability in negligence has been established,the next point to consider is that of remedies and the aim of the remedies is to put the claimant in the position that he would have been in had the breach of obligations not taken place.For negligence,the aim is therefore to put the claimant in the position that they would have been had the tort not been committed.

Again,as with contract,the damages payable may also be reduced because of the claimant’s conduct.In negligence,this may be due to the partial defence of contributory negligence.This happens in cases where,even though the defendant was at fault,the claimant contributed to their own loss.Where this happens,the claimant’s damages are reduced by the percentage to which the claimant is held to be at fault.The leading case here is Sayers v Harlow UDC(1958)where the claimant was trapped in a public toilet due to a defective lock.She was injured when trying to climb out and it was held that she had contributed to her own injuries.It is for the defendant to prove that the claimant was contributorily negligent.

Conclusion

Contract and the tort of negligence arise in separate questions on Corporate and Business Law,so you will not be asked to compare and contrast them.The aim of this article is to identify some key similarities and differences so that you are less likely to confuse these two areas.Your aim for the exam should be to be able to explain these key aspects of contract and negligence without confusing them.You may find that the following table acts as a useful revision aid:

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Written by a member of the F4 examining team

ACCA LW考点: Key aspects of the law of contract

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