Assessment task 2 will primarily assess your IRAC skills (i.e. the ability to identify the legal issue, the ability to identify legal rules, and the ability to apply the legal rules to solve legal problems). Examinable topics include tort of negligence, vicarious liability, contract formation, and negating a contract.
LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University ASSESSMENT (TEAM PAPER) COVER SHEET Table of content: Scenario 1: Tort of Negligence (TON) Case 1: Ned v Sara Quick Case 2: Sara Quick v Dr Duy Case 3: Sara Quick v Jack Croll Case 4: Sara Quick v Oakleigh Hospital Case 5: Ned v Jack Croll Vicarious liability Case 6: Oakleigh Hospital v Sara Quick Case 7: Jack Croll v Ned Scenario 2: 9 10 11 LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University Tort of Negligence (TON) 11 Case 1: Tung v Chu 11 Case 2: Tung v Blackrock Café 13 Case 3: Binh v Chu 14 Case 4: Binh v Blackrock Cafe 16 Case 5: Binh v Hospital 17 Vicarious liability 18 Case 6: Blackrock Cafe v Tung 18 Case 7: Blackrock Cafe v Binh 20 Scenario 3: 21 Case 1: Sam (offeree) v Outback Burgers (offeror) 21 Case 2: Gordon (offeree) v Outback Burgers (offeror) 23 Case 3: Carl (offeror) v Opera (offeree) 24 Case 4: Carl (offeror) v Direct (offeree) 26 LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University We assume that the third element of tort of negligence is satisfied in all our tort of negligence cases The defendant caused the plaintiff to suffer injury which was reasonably foreseeable Scenario 1 Tort of negligence (TON) Case 1: Ned v Sara Quick Issue: Can Ned sue Sara Quick under TON for his broken leg? Whether Quick owed Ned a duty of care (DOC) and whether Quick breached that DOC Rule: To sue a defendant under TON, a plaintiff must establish: LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University Owed a DOC A defendant owes DOC to the plaintiff if the relationship between parties falls within the established DOC categories If not, ‘Neighbour test’ must be proven through two elements First, the defendant’s conduct is potentially harmful to others Second, the defendant’s conduct directly affected the plaintiff.1 Breach of DOC In deciding whether a reasonable person breach DOC, under the Civil Liability Act, the court must consider: (a) the probability of harm (POH): The higher the POH, the greater the required standard of care (SOC), Bolton v Stone.2 (b)the likely seriousness of harm (LSOH): The higher the required SOC can stem from the higher LSOH, Paris v Stepney Borough Council.3 (c)the cost of taking precautions (COP): Donoghue v Stevenson [1932] AC 562 Bolton v Stone [1951] AC 850 Paris v Stepney Borough Council [1951] AC 367 LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University If the defendant could have avoided causing harm by cheap and easy measures, failing to take these measures is likely a breach of DOC And vice versa, Latimer v AEC.4 (d) the social utility of the activity that creates the risk of harm: The SOC is low if the activity is useful to society as a whole, Watt v Hertfordshire County Council.5 Application: Ned and Quick did not fall within the established DOC categories relationship Therefore, the "Neighbour test" must be applied When Quick speeded up, she could not handle the scooter, potentially harming any customers in the store Accordingly, Ned was one of the shoppers, so Quick's conduct closely and directly affected him Consequently, the test is satisfied, Quick owned Ned the DOC Latimer v AEC Ltd [1953] AC 643 Watt v Hertfordshire County Council [1954]1 WLR 835 Donoghue v Stevenson, above n LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University In deciding whether a reasonable person would have taken precautions, the civil liability legislation obliges the court to examine four factors: POH, LSOH, COP, and social utility According to Bolton v Stone7, the POH is high Because there were many people at the store, the accident that impacted customers was likely to happen when Quick lost control From Paris v Stepney Borough Council8, the LSOH is medium since someone was hit by a scooter, they could suffer scratches, bone fractures, or spinal cord injuries, but not lead to death Stated in Latimer v AEC9, the COP is cheap since the defendant could speed down, keep this speed constantly and observe around carefully There was no social utility as Quick's action just benefited the store.10 Consequently, the SOC is high, Quick did not what a reasonable person would have done Therefore, the Quick breached DOC to Ned Bolton v Stone, above n Paris v Stepney Borough Council, above n Latimer v AEC, above n 10 Watt v Hertfordshire County Council, above n LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University Conclusion: Ned can successfully sue Quick under TON for her extensive speed, causing Ned injury Quick should ride with low speed and notice around carefully to better manage the risks Case 2: Sara Quick v Dr Duy Issue: Can Sara Quick sue Dr.Duy under TON, making Quick's injury deteriorate and affect her left eye? Whether Dr Duy owed Quick a DOC and whether Dr Duy breached DOC to Quick Rule: To sue a defendant under TON, it is needed to consider: Owed a DOC: LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University A defendant owes a DOC to the plaintiff if their relationship falls within the established categories of DOC A doctor owes a DOC to their patient, Rogers v Whitaker.11 Breach of DOC: We will apply the rules in this requirement similarly in case Application: Firstly, Dr.Duy was a doctor; thus, he owes a DOC to all his patients, including Quick This was established in Rogers v Whitaker.12 Secondly, The POH was low13 Because Duy was a skilful doctor, the chance of sympathetic ophthalmia is extremely rare (1:14000), and not all cases cause blindness in the affected eye The LSOH would be mediumhigh14 because the operation may make Quick experience other problems, including the surgery complications Besides, it was easy to take precautions.15 Dr Duy could warn or provide Quick with adequate information as to the risk involved So, Quick could be aware of that risk 11 Rogers v Whitaker [1992] 175 CLR 479 12 Rogers v Whitaker, above n6 13 Bolton v Stone, above n 14 Paris v Stepney Borough Council, above n 15 Latimer v AEC, above n LAW2447_Business Law _ Team Assignment _ Case Solution _ RMIT University Besides, she could take steps to have it performed by the most experienced surgeon with a record and a reputation in this field, resulting in a better outcome Although there was an existence of social utility 16 that Dr Duy was trying to recover Quick's sight, the SOC is high Duy failed to meet SOC Therefore, Duy breached DOC to Ned Conclusion: Quick can sue Duy under TON for lacking warning inherent risks of the operation, leading to her blindness Dr.Duy should warn her of the possible risks to better manage risks Case 3: Sara Quick v Jack Croll Issue: Can Quick sue Jack Croll under TON for lacking warning, creating her blindness of right-eye? Legal questions are whether Jack Croll owed Quick a DOC and whether Croll breached the DOC Besides, the subordinate issue is whether Croll can raise any defence to reduce liability 16 Watt v Hertfordshire County Council, n 10