200909 Enterprise Law - Free Assessment Answer

Part A:
Harry and Will are employees of Australia Post at a mail sorting centre in suburban Sydney. A few weeks ago, they noticed a large bulging parcel that had arrived while they were sorting the mail. Suspecting that it might contain something dangerous or illegal, they placed it in an unlocked cupboard and notified the police.

Unknown to both Harry and Will, the parcel contained a number of live snakes that were being transported illegally. Before the police arrived, the snakes escaped from the parcel and found their way onto the street where they were seen by a number of people.

Meghan, a pedestrian, was so distressed when she saw the snakes that she suffered a heart attack.
Catherine was bitten when she tried to retrieve one of the snakes. She was rushed to the nearest hospital where a doctor administered a drug that was not effective against the snake venom. Catherine has been severely affected by the venom and can no longer walk. Had she been given the correct treatment she would have fully recovered.

Meghan and Catherine have approached you for advice as to who they can sue in these circumstances and the likelihood of success if they sue in the tort of negligence. Advise the parties.

Part B:
Pablo was a young man who had suffered extensive injuries in a motor vehicle accident and was confined to a wheelchair. He had sued the driver of the car responsible for his accident and was awarded $3.2 million by way of damages. Pablo’s parents, Edvard and Frida, had no business experience, both having worked in cleaning jobs since arriving in Australia in 1989. Their English was competent for everyday needs but not adequate for complex matters. All three relied heavily on advice from Caveat, their solicitor, whom they asked to help them with investment advice.

Caveat suggested that they consult BNQ, a financial institution in suburban Sydney, which offered a service advising clients about investment opportunities and possible savings and investment plans. When the parents attended the first appointment they met Merlin, a young financial adviser who took all details of their circumstances and then proposed a range of investments, principally in property which could earn income plus a capital gain. He offered to organise flights for them to inspect the properties, which were in northern New South Wales. He said it was impossible to recommend properties within Sydney, as rental prospects were quite poor.

The parents were flown to a university town in northern New South Wales and shown several blocks of units which Merlin described as fully let to students during the year and to overseas visitors during the summer vacations. Merlin also offered to organise conveyancing services at low cost through the estate agents. Merlin suggested that it would be better not to discuss all details of the investment with Caveat as many solicitors were jealous of cut-price conveyancers who undercut their fees.

Answer:

Issue

The issue is to check that whether Meghan and Catherine can initiate an action under Negligence factor of Tort Law and if yes then to whom they can sue.

Rules

Negligence is a significant term of Tort Law. This is a situation where a person owes a duty of care in respect to other one and cause of his/her negligence the other person suffers from a loss/damage (ACCC, 2018). The duty of care is a mandatory term to establish a case of negligence. It is very general that people act negligently in many of the situations where they need to behave like a reasonable person Breach of such duty is another important aspect of a case of negligence (E-law Resouces, 2018).

The loss must be there and the same can be in form of Personal injury, economic loss, and psychiatric injury. It was held in the case of Barnett v Chelsea & Kensington Hospital [1969] 1 QB 428 that loss must be a direct result of the negligent act of defendant in a case.

Vicarious Liability:

This is another important aspect of Tort Law. This is a term that can apply in those cases where a person commits a tort act while doing conduct on behalf of other. The term is closely connected to the employee-employer relationship. According to the concept of vicarious liability an employee while performing his job, act similar to an agent of his principal i.e. employer (Steele, 2017). The law of agency applies in such cases and accordingly an employer is liable for a Tort committed by his/her employee. A claimant can sue the employer for a tort conduct of his/her employee.

Application

In the given case, two of the employees of Australia Post were engaged on sorting mail and found a suspicious parcel. They had reason to believe that something is wrong with the box and therefore they have placed the parcel in an unlocked cupboard, although they have called the police to find out the issue. There were many live snakes in the box. The issue in the case started when snakes went out of the box and premises of Australian post. They were walking onto the streets outside. Meghan, one of the pedestrian on that road saw the snakes and cause of this she got a heart attack.

In addition to Meghan, the snake bit Catherine, another person. When she went to the doctor, the doctor failed to provide a proper medicine to Catherine and therefore she became unable to walk anymore.

Here, applying the provisions of Tort law, Harry and Will owed a duty of care in respect of Meghan and Catherine. When they were aware that the parcel holds something dangerous they must not have kept the same in an unlocked box. By doing this, they failed to perform their duty of care. In addition to this two conditions, further the third condition i.e. the existence of loss is also been satisfied in the form of physical injury, as Meghan suffered from a heart attack and Catherine suffered from a permanent injury of the leg. Applying the provisions of Barnett v Chelsea & Kensington Hospital, this can be stated that these physical injuries were the direct reason of the negligence of Harry and Will.

Applying the provision of Vicarious Liability in the case, Australia post is seems to be held liable for the negligence of it is guilty employees i.e. Harry and Will

In conclusion, this is to be stated that all the necessary conditions of negligence are satisfied here. Australia post will be held liable for the negligent act of Harry and Will. Meghan and Catherine are the victims of personal injury and therefore can sue Harry and Will and also their employer that is Australian Post.

Issue

To advise the family that is there any duty of care exist in the case and if yes then at the end of which person?

Rules

The duty of care is an obligation where one person is required to behave similarly to a reasonable and responsible person (Legal Dictionary, 2018). Some of the relationships are defined under the law where one person owes a duty of care in respect to others. These relationships are doctor-patient, father-son, and solicitor-client and so on (Lewis and Owen, 2014). Whether a duty of care exists or not in a transaction, depends on the relationship between the parties. It was held in the case of Caparo Industries Plc v Dickman [1990] 2 AC 605, that duty of care will be there when a defendant can foresee the possible risk. Although it is required that there must be a direct loss to the victim cause of this negligence. Under the concept of Vicarious Liability, the employer is liable for the breach of the duty of care by his/her employees (Laws, 2018).

Application

In the given case, a family of three members is a center. The young member of the family was not able to move from wheelchair. Further, the elder one i.e. parents of the young man were not so good in English and in addition to this, they had no knowledge and experience of business. In such a circumstance, it was the liability of Merlin the employer of BNQ, a financial institution to provide the best financial advice to the old couple. Applying the provisions of Caparo Industries Plc v Dickman , Merlin can foresee the involves risk in the subjective transaction. Here Merlin being a financial advisor owed a duty of care towards the family and he further breached the same by providing wrong advice to them.

In conjunction with this, he also stopped attending the calls of the old couple. Cause of wrong advice of Merlin, the family has suffered from an economic loss. Here, Merlin owed a duty of care and the same can be held liable. In addition to Merlin, his employer BNQ will also be held responsible cause of application of Vicarious Liability rule.

Conclusion

Two of the persons owed a duty of care, one is Merlin himself, and another one is his employer. They breached their duty and cause of this the family had to face economic loss. Both Merlin and BNQ financial institution can be held liable for the breach of duty.

References

ACCC. (2018) The Tort of negligence. [online] Available from: https://www.accaglobal.com/ca/en/student/exam-support-resources/fundamentals-exams-study-resources/f4/technical-articles/tort-negligence.html [Accessed on 09/09/2018]

Barnett v Chelsea & Kensington Hospital [1969] 1 QB 428

E-law Resouces. (2018) Negligence. [online] Available from: https://e-lawresources.co.uk/Negligence.php [Accessed on 09/09/2018]

Laws. (2018) A Quick Guide To Vicarious Liability. [online] Available from: https://tort.laws.com/vicarious-liability [Accessed on 09/09/2018]

Legal Dictionary. (2018) Duty of Care [online] Available from: https://legaldictionary.net/duty-of-care/ [Accessed on 09/09/2018]

Lewis, J., R., and Owen, S. (2014) Law for the Construction Industry. USA: Routledge.

Steele, J. (2017) Tort Law: Text, Cases, and Materials (4^th edition) Oxford: Oxford University Press.

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