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Chapter 3 - The law of torts. At the end of this chapter you should understand: the difference between a tort and a crime, the elements of the tort of negligence and its applications, the amendments made to the common law of negligence by civil liability statutes, defences to negligence, torts against persons, torts against chattels, tort of nuisance, tort of defamation, changes to Australian defamation law, doctrine of vicarious liability.
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Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev 2-1 The law of torts Chapter Copyright â 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-2 Learning objectives At the end of this chapter you should understand: • the difference between a tort and a crime • the elements of the tort of negligence and its applications • the amendments made to the common law of negligence by civil liability statutes • defences to negligence • torts against persons • torts against chattels • tort of nuisance • tort of defamation • changes to Australian defamation law • doctrine of vicarious liability Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-3 Introduction: what is a tort? • A tort is a civil wrong aimed at protecting individuals against infringements of their own personal rights • These infringements may be against another’s property, reputation or person • The law of torts provides rules of conduct that regulate how members of society interact, and remedies if the rules are breached and damage is suffered Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-4 Types of torts • Unintentional – Tort of negligence • Intentional – Torts against the person – Torts against chattels trespass against goods conversion of goods detinue – Torts against land assault trespass against land battery public nuisance false imprisonment private nuisance – Tort of defamation Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-5 Tort of negligence • Definition: A duty is imposed on a person by law to act with care towards others If this duty exists and there is a failure to act carefully and another suffers loss, then the tort of negligence is committed • Prerequisites: – A duty of care must be owed by one person to another – There must be a breach of that duty of care – Damages (physical or financial) must have been suffered as a result of the breach of duty Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-6 Historical development of the law of negligence • Donoghue v Stevenson (1932) AC 562 – snail in a bottle of ginger beer • From this case, the legal principle known as the 'neighbour principle' developed • This principle indicates to whom a duty of care applies, based on: – foreseeability – proximity Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-7 Neighbour principle 'You must take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour.' 'Who in law is my neighbour?’ 'Persons who are so closely and directly affected by my act that I ought reasonably to have them in contemplation as to being so affected when directing my mind to the acts or omissions which are called in question.' (Lord Atkin in Donoghue v Stevenson (1932) AC 562 at 580) Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-8 Establishing a duty of care— foreseeability test • Would a reasonable person foresee that damage may result from the defendant’s action, i.e is damage preventable and consequently avoidable? • Consider Sydney Water Corporation v Mario Turano and Anor (2009) HCA 42 • Good Samaritans and volunteers acting in good faith are exempt, under legislation, from liability when assisting those in need Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-9 Establishing duty of care— proximity • Historically, there must be some relationship between the parties, namely: – physical proximity – circumstantial proximity (i.e relationship exists between parties) – causal proximity • Proximity is no longer relevant in establishing a duty of care Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-10 Precedents existing for tort of negligence • Motor vehicle accidents • Occupier’s liability • Product liability Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-24 Motor vehicle accidents • All drivers owe other road users a duty of care • If this duty is breached and damage is suffered, the tort of negligence has occurred Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-25 Insurance areas • Personal injury – Compulsory third party (included in car registration fee) • Property damage – Comprehensive (for all property damage incurred) – Third party property insurance (for damage to another person’s property) Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-26 Occupier • A person will be regarded as an occupier of premises if he/she has the occupation and control of land or a structure • Occupier owes a duty of care to all persons (invited and uninvited) entering the premises • Premises are not restricted to just buildings They include moveable structures such as planes • In SA, Vic and WA legislation now deals with occupier’s liability Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-27 Product liability • Donoghue v Stevenson – Manufacturer owes a duty of care to ensure that the product does not cause harm • Chapter 3, Part 3.5 of the Australian Consumer Law – Liability is imposed on manufacturers and importers of defective goods • Legislation only permits one action, which must be brought against all wrongdoers together, not separately Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-28 Torts against the person • Assault: when the act of one person causes another to believe that he/she is going to be physically harmed by the person • Battery: the intentional application of force to another person • False imprisonment: when a person’s freedom of movement is removed so that there is no reasonable means of escape Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-29 Torts against chattels (i.e goods) • Trespass against goods: the wrongful interference with the enjoyment of the possession of goods • Conversion of goods: an act in relation to a person’s goods that eliminates the owner’s rights to the goods • Detinue: the wrongful retention of another’s goods Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-30 Torts against land • Trespass against land: owner’s/occupier’s consent is not obtained before entering (direct interference with plaintiff’s possession) • Public nuisance: an act that interferes with the enjoyment of a right to which all members of the community are entitled • Private nuisance: an unlawful interference with a person’s use or enjoyment of land, or with a person’s right over or in connection with the land (indirect interference with plaintiff’s possession) Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-31 Tort of defamation ‘Defamation is the publication of a statement that tends to lower a person in the estimation of right-thinking members of society generally; or that tends to make them shun or avoid that person.’ — Winfield & Jolowicz on Tort (1994, p 78) Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-32 Elements of the tort of defamation • The statement must be defamatory, i.e a statement that can’t be proven to be true and/or tends to damage a person’s reputation • Statement must refer to the plaintiff • Statement must be communicated to a third party • Defendant must be unable to rely on a valid defence, namely: – consent – justification (or truth) – fair comment – absolute privilege – qualified privilege Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-33 Defamation Act 2005 • Uniformly enacted by Australian states and territories to supplement the common law • Main features are: – Companies cannot sue for defamation – No action for deceased persons – Distinction between libel and slander removed – Multiple imputations treated as one cause of action – Changes to dispute resolution procedures Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-34 Defamation Act 2005 (cont.) • Additional valid defences introduced: – Innocent dissemination protects subordinate publishers unaware of the defamation – Triviality for where the defendant was unlikely to sustain any harm Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-35 Doctrine of vicarious liability Where a particular relationship exists (e.g between employer and employee), a person can be held responsible for the acts or omissions, i.e torts, of another person Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-36 Vicarious liability • Vicarious liability—employee Control test: told what to and how to it • No vicarious liability—independent contractor Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-37 Liability • Employer will be vicariously liable for the employees if: – acts or omissions are committed in the course of their employment – acts occur while carrying on an authorised task, even if carried out in an unauthorised manner Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev •2-38 ...The law of torts Chapter Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev • 2-2 Learning objectives At the end of this chapter. .. result of the breach of duty Copyright © 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev • 2-6 Historical development of the law of negligence... 2014 McGraw-Hill Education (Australia) Pty Ltd PPTs to accompany Barron, Fundamentals of Business Law 7Rev • 2-1 4 Breach of the duty of care • Standard of care expected (i.e the amount of care that