These are the complete notes for all weeks of lectures for both the finance and law component of the Finance and Law Module (MGT388). These are summaries of the lectures and are well formatted.
THE TORT OF NEGLIGENCE
“The defendant is liable for all damage caused by his breach of duty to take reasonable care, provided that the
damage is not too remote.”
The essential components of negligence:
1) A duty of care exists (see Tort lecture 1)
- Must be a relationship by which a duty of care is owed - carelessness alone does not give rise to
liability
- A duty of care is a legal obligation which is imposed on an individual requiring adherence to a standard
of reasonable care in the performance of an act that could foreseeably cause harm to others
- e.g. duty of care owed by employer not to cause employee physical injury
- When does a duty of care exist?
- Precedent (found to exist in previous cases regarding similar circumstances)
- By analogy to those duties of care found in previous cases (e.g. nursery/childminder)
- If new circumstances fulfil the requirements of the ‘Caparo Test’
- Note: special rules for cases regarding pure economic loss and pure psychiatric injury
2) There is a breach of that duty
- A defendant is only liable if he can be shown to be at fault
- How should the defendant have behaved in the circumstances? (a question of law – see next
slide)
- How did defendant actually behave? (a question of fact/evidence)
- If the defendant’s actual behaviour is below that which the law defines as a minimum standard
then a duty of care owed will be breached
- “Negligence is the omission to do something which a reasonable man would do, or doing something
which a prudent and reasonable man would not do [in the circumstances]” (Blyth v Birmingham
Waterworks Co.)
- Minimum standard = what is
(i) reasonable
- What level of care would be expected of the reasonable person in the position of the defendant in all
the circumstances?
- Reasonable person = an objective legal test
- What level of care and skill did the activity that the defendant was undertaking require?
(Nettleship v Weston)
- Exceptions i.e. where a characteristic of defendant has been incorporated in test:
- Where illness has affected functioning of brain and was unbeknown to defendant (Mansfied v
Weetabix)
- Children – “what can be objectively expected of a child of that age” (Orchard v Lee)
- Special skills i.e. Professionals acting in their capacity as professionals and exercising a special
skill/competence – “an ordinary skilled person professing to exercise that skill” (Bolam v Friern
Hospital Mgt)
(ii) in the circumstances
- Magnitude of risk
- Probability that injury will occur (Bolton v Stone)
- Seriousness of injury (Paris v Stepney BC)
- Cost of eliminating the risk
- i.e. cost of taking precautions
- Conformity with standard practice
- Generally “neglect of duty does not by repetition cease to be neglect of duty”
- Exception – In the consideration of professionals acting in their capacity as professionals
exercising a special skill/competence (Bolam v Friern Hospital Mgt)
- Social value of activity
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