Legal Responsibilities And Remedies For Negligence In Business Essay.

1. ) Demonstrate knowledge and understanding of the range and scope of legal and professional responsibilities within the business sector

2. ) Identify and understand the key concepts of contract and how they relate to business organisations and professional behaviour

3.) Demonstrate an ability to use legal authority appropriately and apply relevant law to a range of business scenarios

For the last 5 years Simon has produced “You’re Hired” a business based TV talent show based in the UK where professional applicants compete for the role of CEO of his TV Production Company. Last season’s show saw increased viewing figures and higher advertising revenue due to the popularity of the head judge Taylor who is a well-known celebrity and business woman and Simon has secured Taylors exclusive participation in the show for another season. Simon is aware that Taylors friend Kim was recently the victim of a robbery in France and as part of the negotiation promised to provide Taylor with a personal bodyguard 24 hours a day whilst the show is in production at a personal cost to him of £10,000 and this is stated in the contract which is written in accordance with English Law.

Following the finale of the show Simon arranges a party for the judges and contestants.
Taylor’s bodyguard gets distracted and allows a fan to grab Taylor causing her to fall and break her leg which results in her being unable to fulfil a number of personal appearances for which she would have been paid £1,000,000.

As Taylor does not want to sue Simon under contract so she can maintain a good working relationship with him, advise Taylor:-

1) Of the responsibilities owed to her by her body guard under the tort of negligence

AND

2) Of the legal remedies that may be available to her

AND

3) Of the alternative dispute resolution methods Taylor may wish to consider to avoid court action

Academic Guidance

The question does not ask you to write an essay on tort, it asks you to advise Kim on the liability owed to him under the tort of negligence in English Law.

Demonstration of legal and professional responsibilities in business organisation

Dear Ms. Taylor,

I am writing the advice in regard to the incident that took place recently causing leg injury along with a personal damage of 1,000,000. The issue was regarding negligent action on the part of the bodyguard who failed to take reasonable care in his part.

Tort can be defined as a civil wrong which causes injury to an individual done ny another person. As a result of such wrongdoing on the part of one party, the injured person can bring a claim for such injury (Beever 2015). In order to make a successful claim under law of tort, it is important to prove that there was-

• Duty of care.
• Breach of such duty of care.
• Damage caused as a result of such duty of care.

Supply of Goods and Services Act 1982: According to the implied terms of the contact with Simon, it is important on his part to provide you with a reasonable service (Abraham and White 2017). Therefore, in your case Section 13 can be applied. The duty assigned to the bodyguard was to take reasonable care which he failed to take.  

Under the law of tort, various duties are there on the part of the defendant towards the plaintiff. These duties can be categorized as-

1. Duty to take care.
2. The breach of such duty.
3. The nature of the breach is such that it caused serious and consequential damage to the plaintiff.

Duty of Care was first established in the landmark case of Donoghue v Stevenson (1932) Ac 562. In this case, it was held that, there is a duty of care on the part of the manufacturer towards the customer. Failure on the part of the manufacturer to provide duty of care towards the customer has been sued under the law of negligence. Similarly in the case of Hill v Chief Constable of West Yorkshire (1988) 2 All ER 238, it was observed that, a student was murdered due to negligence on the part of the ripper. In this regard, the estate sued the defendant. In this case, it was observed that, the defendant can only be held liable only when the duty of care is towards a specific person and not towards the public as a whole.

Therefore, in the present case study, it can be observed that, there was a duty of care on the part of Taylor’s bodyguard to protect her from her fans. However, the bodyguard failed to take reasonable care and a result of it; Taylor could not make personal appearances and in such process suffered a loss of 1,000,000.

In this regard, it is worthwhile to refer here that, if there is duty of care, there must be breach of such duty of care. In order to establish that whether there was duty of care, it is important to prove that-

1. The likelihood of such breach or damage.
2. The seriousness of such damage.
3. The cost incurred to cover such injury or damage.

Understanding of contract law and its relation to business organizations and professional behaviour

Seriousness of damage was first established in the landmark case of Paris v Stepney Council (1951) Ac 367. In this case, the likelihood of risk was relatively much higher because the behavior of the defendant was such that it was considered to be careless and the injury caused to the claimant was serious. In this case, it was held by the Court that, if the defendant was careful in his actions then there would have been less damage. Similarly, in the case of Boulton v Stone (1951) Ac 850, it was held that the action of the defendant was serious and careless. The Court was of the opinion that, the defendant could have done something to reduce the consequences of the damage. In this regard, it is worthwhile to refer the case of Daborn v Bath Tramways ( 1946) 2 All ER 333. In this case, it was held that the driver was negligent while driving the ambulance. In this case, it was held by the Court that there was no duty of care on the part of the driver and therefore, he has not breached any duty.

In the present case, it can be observed that the likelihood of the damage was higher and the bodyguard (defendant) was careless. The bodyguard did not make any attempt to reduce the seriousness of the damage and was negligent in his act. Therefore, the case of Boulton v Stone and Daborn v Bath Tramways can be referred. 

It is important to emphasize upon the concept of duty of care in relation to financial loss. When the nature of the damage is such that it comprises of pure economic of financial loss, the Courts in such cases may not consider it to be reasonable to impose duty of care upon the defendant without examining the degree of proximity associated with it. In such cases, the Courts are at the authority to impose duty for consequential economic loss.  In the case of MIURHEAD v INDUSTRIAL TANK SPECIALTIES Ltd [1986] QB 507, it was observed that the plaintiff owned a lobster farm and the defendant supplied him with oxygen pumps. It was observed that the lobsters died due to the non-functioning of the oxygen pumps. In this case, it was held by the Court that, the plaintiff was entitled to recover the consequential loss that occurred to him and the consequential cost for restocking the fresh lobsters. It is worth mentioning that, pure economic or financial loss can be derived from goods which are defective in nature. The nature of consequential economic loss is such that it can create unfavorable impact upon the damage caused as a result of negligence on the part of the defendant.

Application of relevant law to business scenarios

Similarly, in the present scenario, Taylor faced consequential economic loss and the nature of the loss is such that it created unfavorable impact on her profession. As a result of which she was unable to make personal appearances. It can be held that this consequential economic loss was as a result of negligence on the part of the defendant.

The reasonable man is considered as a hypothetical person who is supposed to foresee the seriousness of the damage. However, in legal fiction, such reasonable person owes a standard of duty of care to the claimant or to the community under certain circumstances.

In case of professionals, the standard of care by a reasonable person under certain circumstances is generally taken into consideration. In the case of Heath v. Swift Wings, Inc. COA NC – 1979, in this case, it was observed that the Pilot was involved in a plane crash that killed his wife child and other passengers. It was held by the Court that, the Pilot being a professional and a reasonable man should have foreseen the seriousness of the damage.

Similarly, in the present case sty, Taylor’s bodyguard was a professional and could foresee the consequences of the damage as any reasonable man could foresee. In this regard the case of Heath v. Swift Wings, Inc. COA NC – 1979 can be applied.

It is important to test the nature of breach of duty on the part of the defendant. In this regard, it is important to test that whether the action of the defendant was such that any reasonable person of ordinary prudence would have done (Herron, Powell and Silvaggio 2016). In this regard, it is worth noting that, whether the defendant in his part failed to take reasonable care in order to stop the injury from taking place which any reasonable man of prudent nature would have. However, the action on the part of the defendants’ amounts breach of duty entirely depends upon the circumstances of the case. In the case of PARIS v STEPNEY COUNCIL [1951] AC 367, it was held by the Court that, the defendant is expected to reduce the seriousness of the risk in order to lessen the extent of the damage. The plaintiff was an employee of the defendant and was blinded as a result of an accident at work. In this case, it was held by the Court that, the defendant did not take reasonable care and failed to supply goggles to the plaintiff which caused injury to his eyes.  Similarly, in WITHERS V PERRY CHAIN Ltd [1961] 1 WLR 1314, it was observed that the plaintiff became allergic with grease. In this case, the defendant has reasonably taken all the precautions which any reasonable man of ordinary prudence would have done. Therefore, the defendant was not held liable.

In the present scenario, it can be observed that there is a duty of care on the part of the bodyguard towards Taylor which he failed to provide. The bodyguard was negligent in his act and was careless and as a result of which Taylor faced both physical and financial injury. In this case, the bodyguard should provide reasonable consideration to Taylor by means of compensation.

The available defenses can be categorized as-

1. Statutory justification.
2. Contributory Negligence.

Various remedies are available under law of torts. These are damages and injunctions. In some cases, it may occur that the plaintiff has occurred serious damages as a result of action on the part of the defendant. In such cases, damages are paid to the clamant that usually consists of a sum of money. However, it is important to prove that the defendant has caused breach of duty of care for the purpose of incurring damages from the breaching party. Damages can be legal or equitable. Legal damages are regarded as money damages while equitable damages are based on the particular situation. However, in cases involving negligence and torts, money damages are imposed as it is a legal remedy. The Courts are at the authority to grant both money and equitable damages accordingly.

Injunction can be defined as the discretionary order on the part of the Court. The nature of such discretionary order is such that it may cease the individual from committing the wrong for the second time. Injunctions may be of different kinds- interim, prohibitory and mandatory. The nature of prohibitory injunction is such that it can prohibit the person from committing the tort again. On the other hand, mandatory injunction imposes certain conditions on the defendant so that he can refrain himself from committing tortuous activities in the future. In this regard, it is noteworthy to mention here that, injunction needs to be obeyed by the defendant otherwise it may lead to serious consequences. Injunctions can be both permanent and temporary. Permanent injunctions are usually granted by the Court after hearing the matter in dispute. However, a claim for injunction can be filed in a separate lawsuit. Temporary injunctions are immediately enforceable after it has been granted by the Court however; it lasts within a short period of time.

In the present case, it can be observed that Taylor faced financial and physical injury as a result of negligent action on the part of the bodyguard. Therefore, in this case, the remedy of damages and injunctions are available to Taylor. Taylor can sue the bodyguard for breach of duty of care and incur the damages. In this regard, it would be beneficial if Taylor opts for money damages as it is legal and most appropriate form. On the other hand, Taylor can also bring an action of claim before the Court and impose injunction in order to refrain the bodyguard from committing such negligence in the future. Taylor can opt for both permanent and temporary injunction. However, the nature of temporary injunction is such that, it can be immediately enforceable by the application of law.

In case of civil matters, it involves dispute between two persons. Therefore, the nature of civil matter is such that it concerns disputes between the individuals as a whole. In cases involving civil matters, there is a choice on the part of the injured party whether to bring a claim of action before the Court or not. In this regard, mention can be made of Alternative Dispute Resolution which is the most appropriate way to solve disputes. Parties in dispute can avoid litigation because it is time consuming and expensive compared to Alternative Dispute Resolution methods (Meyerson 2015). The three methods of Alternative Dispute Resolution are arbitration, conciliation and mediation.

1. Arbitration:In case of arbitration, the decision taken by the arbitrator is final and binding upon the parties. The parties have to abide by such decision whether they agree or not (Dye 2017). As a result of this, the method is less time consuming and less expensive and therefore can be relied upon.
2. Conciliation: A conciliator is an individual who assists parties to dispute in order to provide an appropriate resolution (Wang 2014).  However, it is worth mentioning that, conciliators may have the power to recommend a suitable solution; they cannot enforce it by the application of law. The process of conciliation is less formal than that of arbitration. In case of arbitration, the decision is binding upon the parties whereas in case of conciliation the decision is not final and binding. The parties may involve in the process of litigation thereafter.
3. Mediation:Mediation is an informal process which involves a mediator. The mediator is a third person who carries on the process of mediation (Meyerson 2015). Mediation is less formal, less time consuming and more accurate.

In most of the civil matters, it can be observed that the process of litigation takes much more time than required. However, in case of alternative dispute resolution, the civil cases are settled down even before trial. It can be stated that, the decision taken during processes involving alternative dispute resolution are more accurate than court proceedings and can be relied upon (Dye 2017). It can be rightly stated that, in case of alternative dispute resolution methods, there is an offer on the part of the claimants to settle the matter. In this context, if an offer is made by the claimant in order to settle the dispute for a prescribed sum and in such process, if the offer is not accepted by the defendant then the matter is decided in the favor of the claimant. It has been accepted by the jurists that both litigation and the methods involving alternative dispute resolution proved to be beneficial. However, the process of alternative dispute resolution is less time consuming and more accurate.

Therefore, in the present case study, it can be advised to Taylor to involve the process of arbitration as an alternative method of dispute resolution to resolve the matter in dispute with the bodyguard. This is because, the process of arbitration is formal and accurate and the decision is final and binding upon the parties involved. The defendant will have to abide by the decision taken by the arbitrator whether he agrees it or not.

Reference:

Boulton v Stone (1951) Ac 850.

Daborn v Bath Tramways ( 1946) 2 All ER 333.

Donoghue v Stevenson (1932) Ac 562.

Heath v. Swift Wings, Inc. COA NC – 1979.

Hill v Chief Constable of West Yorkshire (1988) 2 All ER 238.

Miurhead v industrial tank specialties ltd [1986] qb 507.

Paris v Stepney Council (1951) Ac 367.

Paris v stepney council [1951] ac 367.

Withers v perry chain ltd [1961] 1 wlr 1314.

Abraham, K.S. and White, G.E., 2017. The Transformation of the Civil Trial and the Emergence of American Tort Law. Ariz. L. Rev., 59, p.431.

Beever, A., 2015. What Does Tort Law Protect. SAcLJ, 27, p.626.

Dye, J.C., 2017. Alternative Dispute Resolution. The Catholic Lawyer, 33(1), p.12.

Herron, D.J., Powell, L. and Silvaggio, E.L., 2016. The Evolution Of Foreseeability In The Common Law Of Tort. North East Journal of Legal Studies, 35(1), p.1.

Meyerson, A.L., 2015. Alternative Dispute Resolution. GPSolo, 32, p.6.

Wang, M., 2014. Are alternative dispute resolution methods superior to litigation in resolving disputes in international commerce?. Arbitration International, 16(2), pp.189-212.