Laws of Contract, Negligence, and Regulatory Issues: Case Studies and Analysis

Case Study 1: Oil Drilling Company and Gulf Hotel in Gulf, Florida

Write a discussion (approximately 3 pages, double spaced) of laws of contract, negligence and regulatory issues for one of the following questions. This is an exercise to identify issues and apply basic legal principles, so your efforts should consider laws of contract, negligence and regulations. Analysis is more important than whether you find the correct answers. Some issues are suggested, but to use the imagination to discuss other issues.

1. Find at least one case to discuss. It may be helpful to find a law journal article. Provide proper citations for any reference sources you have used.

2. Provide some management suggestions to avoid these problems.

3. Be sure to state something you learned from this exercise and how you would apply what you learned as a manager.

The Gulf Hotel in Gulf, Florida, found globs of oil on the adjacent public beach. The beach was then closed by order of the local authorities as a health hazard. The oil was leaking from a deep sea drilling rig operated by a drilling company, a company specializing in placing the well’s casing and sealing it with concrete and the oil company which contracted with them.

What standards should be applied to the three parties who were responsible for the oil well drilling?

What parties should have legal claims under negligence law against the oil well companies?

What are the damages available to injured parties under contract and negligence law?

What damages are payable by the injured parties’ own insurance?

Are punitive damages appropriate in this case?

Are damages available for environmental harm?

The Sea Salt Restaurant in Key West, Florida, has received complaints from guests who have contracted Norovirus after eating at the restaurant. Norovirus (also called Norwalk virus) is a common virus which causes headaches, stomach distress, nausea, vomiting, diarrhea and dehydration. The Norovirus is highly contagious and is often spread by unclean hands and work surfaces by ill food workers. Guests and employees of the restaurant have sued for damages from becoming ill from Norovirus at the restaurant.    

What should the restaurant do to preserve evidence as to defend against liability for food borne Norovirus?

What proof would be required that the restaurant has liability?

How can the restaurant defend against liability?

What damages are available for a claimant if the restaurant is liable?

Are punitive damages appropriate in this case?

What liability, if any, does the restaurant have if the virus is a common illness that was brought into the restaurant by guests?

How will it affect liability if the virus was brought into the restaurant by its employees? What effect on liability does it have if the restaurant employees are not given paid sick days? (This is the standard in the industry for many restaurants.)

What effect on liability of the restaurant, if any, does it have if the restaurant had passed recent inspections by the local health department?  What if they were cited for violations? What effect on liability of the restaurant, if any, does it have if the illness is common in the community – outside the restaurant?

What are the differences in claims by restaurant employees as compared to guests? Are persons who did not eat at the restaurant entitled to claim for damages if they contracted the virus from restaurant guests who spread the illness outside the restaurant?

This case is a lawsuit alleging that guests at a hotel suffered bed bug bites during a stay at the hotel and subsequently discovered that bedbugs had infested their home after returning from the stay at the hotel. The hotel had regular treatments for insect prevention by Bugs R Us.

Is the hotel liable under contract law?  Is Bugs R Us liable to anybody? Is the hotel liable under negligence law? Is Bugs R Us liable to anybody?

What proof would be required that the hotel has liability? How can the hotel defend against liability?

What damages are available form a claimant if the hotel is liable? Are punitive damages appropriate in this case?

What liability, if any, does the hotel have if bedbugs are common in the area? How will it affect liability if the bedbugs were brought into the hotel by guests?

What effect on liability if the hotel has regular pest control services? What effect on liability if the hotel had previous incidents of bedbugs?  

Are persons who did not stay at the restaurant entitled to claim for damages if they got bedbugs from hotel guests who spread them to the home of these persons?