Analysis of Tort of Negligence: Case Study of Marketing the Land

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Part A

Problem

Augeas asked Chiron for marketing the land that is available on its development site. Chiron had asked Geryon to do the work and during the work, Geyron damaged an electric cable that further led to damage of IT equipment, destroyed kitchen by fire because of refrigerator short circuit and the fire destroyed the food containers and napkins that were kept in the kitchen for an event. In the context of the current scenario, Augeas is willing to undertake legal actions against both Chiron and Geryon. For Augeas making a successful claim for damage would require to prove the tort of negligence against both Chiron and Geryon. There can be various issues that can cause the claim to be unsuccessful. The legal issues that need to be considered from the problem are:

  • Firstly, is Chiron and Geryon owed Augeas duty of care?
  • Secondly, have the defendants breached the legal duty of care?
  • Thirdly, in case of any breach, has the breach caused any damages?
  • Fourthly, was the loss or damage reasonably foreseeable?

Law

In the UK, under the principle of common law, negligence is the failure to take reasonable care and it is the direct cause of damage. English Tort Law emphasizes to provide compensation for the harm to people’s rights and tort is considered as a civil wrong (Luntz et al. 2017).

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Under English tort law, the liability of negligence is caused by a person’s breach of duty of care that the person owed to another person. It is important to note that the fundamental elements of the tort are the duty of care, breach of the duty and the breach leading to harm or damage. If the plaintiff wants to be successful in the claim of the tort of negligence, the following principles are important for consideration (Kubica, 2017).

Duty of care

The first element of proving a tort of negligence is establishing that the defendant owed the plaintiff duty of care that he failed to exercise reasonably. Donoghue v Stevenson [1932] is the first case, in which duty of care was established. In this case, the plaintiff claimed compensation for drinking a bottle of ginger beer that was contaminated by a snail. In this case, the manufacturer of the beer was held liable and it was suggested that people need to take reasonable care for avoiding actions that are reasonably foreseeable of causing damage or injury to one’s neighbour (Pal, 2019). This rule is also popular as a neighbor principle.

From the case of Donoghue v Stevenson three main elements are recognized for establishing a duty of care and that is the concept of reasonable foreseeability of harm, the proximate relationship between the claimant and defendant and lastly the appropriateness for imposing liability on the defendant. These factors were further clear in the case of Caparo Industries Plc v Dickman. The principle of foreseeability was established in Gallagher v. McDowell (1961) in which the Court of Appeal of Ireland held a contractor being negligently liable for the injury of a person. From this case, it was identified that failure of exercise duty of care would be assessed through the reasonability test for testing whether any reasonable man in the situation of the defendant would have acted differently which could help in avoiding the harm or injury of the plaintiff (Greene, 2017). In case of failure of exercising a reasonable duty of care, the defendant needs to compensate the plaintiff for the damage incurred or physical injury.

According to He et al. (2016) in establishing the duty of care, it is important to establish the proximity between the plaintiff and the defendant. The relationship between the parties can indicate either a general duty of care or a specific duty of care. In Hedley Byrne v. Heller & Partners (1964) the economic loss caused by negligent misstatement was illustrated. Establishing a duty of care was important in this case and House of Lords recognized the liability for pure economic loss caused by the assumption of responsibility that led to a sufficiently proximate relationship that created a duty of care (Plunkett, 2018).

Breach of legal duty

Establishing the duty of care paves the path for next stage that involves proving whether he duty of care has been breached by the significant party and for establishing the breach of duty, the court takes into account the objective test known as a reasonable man. In this test, the court considers whether the defendant would have been expected by the plaintiff to perform the task as a reasonably skilled and competent person (Pal, 2019). In Caparo Industries PLC v. Dickman (1990) the “threefold test” for duty of care to be invoked in case of negligence and it includes testing whether the harm was reasonably foreseeable due to the conduct of the defendant, the relationship between the involved parties and reasonability of imposing liability. This case was important as in the case the court held that foreseeability could not be the sufficient test of proximity.

For establishing the breach of duty of care, it is important for considering the issue of rebutting the duty of care. In Lejonvarn v. Burgess (2017) the appeal emerged from the specific grounds that involved the duty of care existing during the common law despite not having a contract between the parties (Greene, 2017). In this case, the judge identified the duty of care that emerged from pure economic losses and duty of care arising from the assumption of responsibility that had been explained in Henderson v Merrett.

Damage caused by a breach

In order to be successful in the claim of damage, the claimant bears the onus of proof and needs to establish that the damage caused by the breach. Luntz et al. (2017) have stated that causation and remoteness are important factors regarding damages caused by the breach. Causation involves the ‘but for’ test, that is used for assessing whether the action of the defendant resulted in the harm or damage caused to the plaintiff. In Barnett v Chelsea and Kensington Management Committee [1969] Mrs. Barnett sued the hospital for negligence as Mr. Barnett who reached the hospital with the issue of vomiting died five hours later of his visit. In this case, the hospital was not held liable for the death as the ‘but for’ test suggested that even if the hospital would have admitted the man, there was no possibility for administering an antidote and save his life (Kubica, 2017).

Reasonable foreseeability of the damage

Despite the breach of duty, it is possible for the court to deny awarding the damages due to ‘remoteness.’ If the ‘but for’ test establishes a causal link between the harm or damage and the action of the defendant, it is possible for the court to deny compensation if the damage is a remote consequence of the initial breach of duty as identified in Wagon Mound [1961].

Application

From the above principles, it is important to note that in the current scenario, Augeas the plaintiff asked Chiron to do a task believing him to be competent and skilled for the task. As the plaintiff has asked a person based on his skills to perform a task, it establishes specific duty of care for Chiron to Augeas as identified from Hedley Byrne v Heller & Partners [1964]. As it is identified from the first element of establishing the tort of negligence, it is important to establish a relationship that indicates the defendant owed a duty of care to the plaintiff. Here, Geryon is appointed by Chiron and from the decision of Donoghue v Stevenson, it can be stated that Geryon caused the damages to a person due to lack of care and being negligent and he owed a duty of care to Chiron and Augeas as Augeas provided him with a completely equipped marketing suite. Thus, the element of duty of care is established. The possibility of rebutting the duty of care exists as Geryon can argue that he was not being appointed by Augeas but he owns the general duty of care as a professional.

The next element is identifying the breach of duty of care. In Blyth v. Birmingham, Waterworks Co. (1956) the negligence has been defined as failure to do something that reasonable person would do (Pal, 2019). However, an accident that is caused by failure of taking an action is not considered as negligence. The mentioned case held that it is important to show evidence that the failure to exercise a duty of care caused the problem.

From the current scenario, it is evident that the damage caused is damaging the IT equipment and the short circuit resulting in a fire in the kitchen. Geryon damaged the electrical cable that led to the accident (Kubica, 2017). Geryon did not exercise reasonable care that was expected from him when he was appointed with the task. As the accident happened because he negligently damaged the cable, it is established that he breached the duty of care. The reasonable foreseeability as identified from Caparo Industries Plc v Dickman [1990] indicates testing whether the damage was reasonably foreseeable. In this scenario, using damaged electric cable for power supply comes with the risk of accident of short circuit and damaging the IT appliances and thus the damage was reasonably foreseeable.

The act in the scenario indicates the inability to take reasonable care while using the cable and act or omission resulted in the accident. The special standard of care is applicable in the scenario because the special standards indicate exercising a particular duty of care associated with the skill or competence related to a certain profession. A reasonable person would have changed the electric cable or taken effective care so that the cable is protected. Being appointed for the activities, Geryon required to exercise the utmost care for handling the IT equipment. However, the fire caused by the accident falls under causation and despite causal link with the breach of duty of care, the fact that the short circuit would result from restoration of the power was not foreseeable. From the decision of Hughes v Lord Advocate [1963], it can be stated that in a generic sense the incident of fire was not reasonably foreseeable.

It is important to consider the role of Cheron in the scenario and he owes a specific duty of care to Augeas. However, his action of appointing Geryon is not proximate to the accident. However, as Augeas appointed Chiron, he has been negligent in not providing Geryon of necessary information related to the fridge in the kitchen that was in the marketing suite that caught fire due to a short circuit. Geryon can use the defense of contributory negligence as he was not provided with information regarding the circuit system. Along with that the paper napkins and Styrofoam in the kitchen by Chiron led to a serious accident and thus Chiron contributed to the negligence.

Conclusion

The losses are pure economic loss and the accident was serious with the potential of seriously affecting any person. It is possible for Augeas to prove that the breach of duty of care that Cheron and Geryon owed to him caused the loss. He needs to establish that the fire caught in the kitchen was due to Cheron’s negligence of informing Geryon of the circuit system and the paper napkins and Styrofoam based food containers that were placed in the kitchen.

Part b

Introduction

In torts and nuisance cases, the Alternative Dispute Resolution provisions help the parties to resolve the dispute cost-effectively. ADR provides a voluntary alternative of the accepted practice regarding the settlement of civil disputes and the fundamental forms of ADR are conciliation, arbitration, mediation, and adjudication. In UK arbitration is the most commonly used form of ADR.

Most suitable ADR

Lee et al. (2016) have stated that the civil dispute settlement and the voluntary aspect of the private dispute settlement are important in the context of the role that ADR plays. Civil disputes are disputes between private individuals and organizations. There are different routes that can be used in ADRs and the different ADR methods are as follows:

Mediation

Mediation is considered an attempt of leading to peaceful settlement among the parties involved in conflict with the help of a neutral party’s intervention in the dispute. Mediation is a voluntary method but the method is non-binding. According to Hohmann (2018) mediation takes place in the presence of a mediator and a mediator is a person having adequate training and he needs to be neutral to the parties involved in the dispute.

Arbitration

According to Singer (2018) arbitration is a binding process where conflict is resolved in accordance with the decision of the third party which is the arbitrator. One of the important factors of arbitration is that confidentiality is one of the main elements of arbitration and it is faster than litigation. Compared to litigation the arbitration is inexpensive. Blake et al. (2016) have stated that in a particular dispute type arbitrator needs to be selected based on certain skills and expertise.

Mini-trial

According to Singer (2018) mini-trial is a settlement process in which each of the parties would illustrate the case summary. The representative at the end of the illustration would attempt to settle the issue and if the representatives fail to settle the dispute, an impartial advisor functions as mediator. However, similar to mediation, the opinion of the third party is non-binding and this path of ADR is often followed after formal litigation.

Mediation-arbitration

According to () in this form of ADR, the arbitrator works as a mediator first. In case the mediation fails then the arbitrator would impose a binding decision. This is an effective ADR procedure as it has benefits of both mediation and arbitration.

Early neutral evaluation

ENE is useful for the disputes where one or both the parties involved in the dispute seek expert advice from a competent and experienced individual. Blake et al. (2016) have stated that the third party involved in ENE is generally an attorney. ENE is significant as an objective evaluation by an expert third party can help in moving parties away from the absurd positions and help them with more insight regarding the issues of the dispute. The process can only be successful if the parties involved in the dispute have faith in fairness and objectivity. ENE is suggested to the parties who are willing to compromise (Shamir, 2016).

In the current scenario, ADR proved to be beneficial for identifying the liability for the damages and resolving the dispute by agreeing on compensation by both Cheron and Geryon to Augeas. Moving for litigation can delay the process and ADR can be cost-effective as Augeas has already been subjected to economic loss (Singer, 2018). For the current scenario, the above mentioned ADR routes can be taken. The negotiation and summary jury trial has not been mentioned considering the fact that these would not be an effective path to resolve the dispute. It is important to note that the Ombudsman scheme mainly functions as the grievance addressing mechanism and it is mainly used for complaints like no-payment. In the current scenario, it would not be effective.

Application in the scenario

Considering the current scenario, the mediation-arbitration could be considered as the most effective ADR route. The main issue in the case is not proving that the accident caused by negligence and the liability of damages. As the dispute involves liability and contributory negligence for Chiron and Geryon and the decision needs to establish who needs to pay for the damages, the selected ADR can be effective. The mediation would be helpful in reaching a solution regarding Chiron considering his fault and helping Geryon to compensate for the damages. Mediation could be effective if both the parties are ready to contribute and compensate for the damage and Augeas is also ready to consider the fire to be an accident that could have been caused by any short-circuit. If the parties are not ready to compromise, arbitration can take place and it would impose a binding decision for the involved parties.

Advice

Mediation-arbitration can provide effective advice to the parties regarding their roles in the case and provide a suitable solution regarding the liability of paying the damages.

Reference list

  1. Blake, S.H., Browne, J. and Sime, S., 2016. A practical approach to alternative dispute resolution. Oxford University Press. Accessed from: https://books.google.co.in/books?hl=en&lr=&id=31pnDAAAQBAJ&oi=fnd&pg=PP1&dq=alternative+dispute+resolution+methods&ots=AOt2_vejeB&sig=kEAdPCze_NcGi5-x3Z4HuHGYLhU
  2. Greene, B., 2017. Optimize Tort Law. Routledge. Accessed from: https://content.taylorfrancis.com/books/download?dac=C2015-0-79732-6&isbn=9781315410241&format=googlePreviewPdf
  3. He, Q., Feng, J.L. and Huang, W.Y., 2016, August. Law of Negligence: Duty of Care, Standard of Care, and the Notion of Personal Responsibility. In 2016 International Conference on Management Science and Management Innovation. Atlantis Press. Accessed from: https://download.atlantis-press.com/article/25861751.pdf
  4. Hohmann, B., 2018. Possibilities for the Application of Alternative Dispute Resolution Methods in the Administrative Procedure. European Journal of Multidisciplinary Studies, 3(4). Accessed from: http://journals.euser.org/index.php/ejms/article/view/4026/3903
  5. Kubica, M.L., 2017. Legal Doctrine on Rylands v. Fletcher: One more time on Feasibility of a General Clause of Strict Liability in the UK. International Journal of Law and Political Sciences, 10(10), pp.3542-3550. Accessed from: https://www.researchgate.net/profile/Maria_Kubica2/publication/318207687_Legal_Doctrine_on_Rylands_v_Fletcher_One_More_Time_on_Feasibility_of_a_General_Clause_of_Strict_Liability_in_the_UK/links/595ca989a6fdcc36b4e217f8/Legal-Doctrine-on-Rylands-v-Fletcher-One-More-Time-on-Feasibility-of-a-General-Clause-of-Strict-Liability-in-the-UK.pdf
  6. Lee, C.K., Yiu, T.W. and Cheung, S.O., 2016. Selection and use of alternative dispute resolution (ADR) in construction projects—Past and future research. International Journal of Project Management, 34(3), pp.494-507. Accessed from: https://shop.tarjomeplus.com/UploadFileEn/TPLUS_EN_2830.pdf
  7. Luntz, H., Hambly, D., Burns, K., Dietrich, J., Foster, N., Grant, G. and Harder, S., 2017. Torts: cases and commentary. LexisNexis Butterworths. Accessed from: http://sro.sussex.ac.uk/id/eprint/71222
  8. Pal, M., 2019. Economic Analysis of Tort Law: The Negligence Determination. Routledge India. Accessed from: https://content.taylorfrancis.com/books/download?dac=C2018-0-88313-X&isbn=9780429327858&format=googlePreviewPdf
  9. Plunkett, J., 2018. The Duty of Care in Negligence. Bloomsbury Publishing. Accessed from: https://media.bloomsburyprofessional.com/rep/files/9781509914845sample.pdf
  10. Shamir, Y., 2016. Alternative dispute resolution approaches and their application. Accessed from: http://biblioteca.cejamericas.org/bitstream/handle/2015/721/Alternative-Dispute-Resolution-Approaches.pdf?sequence=1&isAllowed=y
  11. Singer, L., 2018. Settling disputes: Conflict resolution in business, families, and the legal system. Routledge. Accessed from: https://content.taylorfrancis.com/books/download?dac=C2017-0-75785-X&isbn=9780429963216&format=googlePreviewPdf

List of cases

  1. Barnett v Chelsea and Kensington Management Committee (1969)
  2. Blyth v. Birmingham, Waterworks Co. (1956)
  3. Caparo Industries PLC v. Dickman (1990)
  4. Donoghue v. Stevenson (1932)
  5. Gallagher v. McDowell (1961)
  6. Hedley Byrne v. Heller & Partners (1964)
  7. Hughes v. Lord Advocate (1963)
  8. Lejonvarn v. Burgess (2017)
  9. Wagon Mound (1961)

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