law
Content
LAW OF TORTS
SEMINAR 10
Torts
• A tort is a recognised civil wrong (other than breach of
contract) which gives rise to a civil remedy.
• Some examples of torts include:
Assault and Battery
Defamation
Deceit
Conversion
Confidence
Passing Off
Vicarious Liability
Negligence
A. Tort of Negligence
•The most common tort affecting
businesses, is the tort of negligence.
•For there to be liability in
negligence, there does not have to
be a contract between the parties,
but the following 4 factors must be
established:
(2)
Breach
(1)
Duty of Care
Negligence
(4)
Remoteness
(3)
Causation
(1) Duty of Care: Test
• In order to establish that the defendant owes the
plaintiff a duty of care, in law:
(a) The relationship between the plaintiff and the
defendant must be close and proximate and
(b) There must not be any policy considerations
negating a duty of care.
(1) Duty of Care: Some well‐established
areas
• Road users – to other road users
• Doctors/lawyers/accountants/bankers/service
providers – to their clients
• Manufactures/distributors/importers – to
consumers where there is death, physical injury or
property damage
• Transporters – to owners of goods/passengers
• Employers – to employees
• Owners of premises – to visitors
(1) Duty of Care
• In some areas: well‐established that there is a duty
of care.
• In some areas: well‐established that there is no
duty of care.
• But there are many categories in between.
• Two such situations:
(a) Negligent misstatements
(b) Pure economic loss
(1)a Duty of Care: Negligent Misstatements
•Can there be liability for a negligence
misstatement as opposed to a negligent
act?
•The answer is ______.
•However, there is a possibility of
unlimited liability and hence courts are
more hesitant to find a duty of care.
(1)a Duty of Care: Negligent
Misstatements
• Duty of care in respect of negligent misstatements
is likely to be established in more constrained
circumstances such as when (Caparo’s case):
(a) The defendant knows that the information was
required for the transaction contemplated,
(b) The defendant knows that it would be
communicated to the plaintiff,
(c) The defendant knows that the plaintiff would rely
and
(d) The plaintiff did rely.
(1)b Duty of Care: Pure Economic Loss
•Pure economic loss refers to pure
financial loss which is not accompanied
by physical injury, death or property
damage.
•If pure economic loss is claimable, there
could be unlimited liability and hence
courts are more hesitant to find a duty
of care.
(1)b Duty of Care: Pure Economic Loss
•However, where it is not a case of
unlimited liability and there is very
close proximity between the parties
(eg: not an unknown person suing) –
it may be claimable (RSP Architect’s
case).
(2) Breach of Duty of Care: Test
•To see if the duty of care has been
breached: must see how another
reasonable man would have acted in the
circumstances.
•Eg: if you are driving and knock
someone down, is it a forgone
conclusion that you have breached your
duty of care and hence are liable?
(2) Breach of Duty of Care
• If the defendant professes to have some skill, who would
another “reasonable man” refer to in this context?
• In determining how another reasonable man would have acted,
it may be necessary to balance: risk and cost of taking
preventive measures.
Eg: If a child falls over a tiger’s enclosure in a zoo and is mauled
by the tiger, has the zoo breached its duty of care? What else
could the zoo have done, taking into account cost and risk?
(3) Causation
•This means that even though the
defendant owed a duty of care and
he breached it, if the loss the
plaintiff is suing for is not caused by
the defendant, the defendant would
not be liable.
Barnett v Chelsea & Kensington Hospital
• Plaintiff’s husband came to defendant’s hospital, complaining
of vomiting, but hospital told him to go home and consult his
own general practitioner.
• Later plaintiff’s husband died – because of arsenic poisoning.
• Plaintiff sued hospital for not treating her husband.
• Court held the hospital breached the duty, but was not liable.
• This was because there was medical evidence that even if the
hospital had treated the husband, the husband would have
died anyway because he came to the hospital at a very late
stage.
• Thus the hospital’s negligence did not CAUSE his death.
(4) Remoteness
•Damages cannot be too remote.
•It would be too remote if it was not
reasonably foreseeable.
•Eg: if you knock down a person and he
dies, can his parent sue you the cost
of having another child through IVF –
or is that too remote?
Defences
• There are some defences open to the defendant
when sued in negligence:
(a) Voluntary Assumption of Risk; ie: the plaintiff
voluntarily agreed to or consented to the loss. If
established, defendant will totally not be liable.
(b) Contributory negligence: the plaintiff also
contributed to the loss. If established, damages will
be reduced.
Case Example: Sayers v Harlow
•Plaintiff found herself locked inside a
toilet.
•So – in an attempt to climb out – she
stepped on the toilet roll – which “true to
its mechanical requirements rotated”.
•She fell and injured herself.
•Was she contributorily negligent?
Defences
(c) Another defence: Exclusion/limitation
Clause:
‐Under UCTA – cannot exclude liability
for ________________.
‐Under UCTA – can exclude liability for
other losses if the clause is __________.
B. Tort of Vicarious Liability
• The employer/principal can be vicariously liable for
employee’s/agent’s actions, if:
(a) The employee/agent has committed a legal wrong
and
(b) The wrong takes place in the course of
employment/duty.
• Note: a wrongful act can take place in the course of
employment/duty even if it is negligently or
fraudulently or intentionally done.
• However, what is and what isn’t in the course of
employment/duty is a question of degree.
Case Example: Koh Get Kee v Low Beng Hui
•An off‐duty police officer who was in
uniform and armed, went on a
drinking spree with his friend.
•He then accidentally shot the friend.
•Were his employers vicariously liable?
•What if the police officer had shot his
wife at home after a quarrel?
•What if there was also something
wrong with the revolver due to the
employer’s fault?
B. Tort of Vicarious Liability
•If the employer/principal is made
vicariously liable, can he in turn take
action against the employee/agent?
•Note also: while an employer/principal
can be vicariously liable for the wrongful
acts of his employee/agent, he would
not be vicariously liable for wrongful
acts on independent contractors. Why?
C. Tort of Passing Off
• To establish tort of passing off, the following 3 factors must be satisfied:
Good
Will
Misrepr
esentati
on
Passing
Off
Likely to
• Goodwill:
suffer
loss
‐ What can a business have a goodwill over?
‐ Can a business have goodwill over common descriptive words (eg:
“Coffeemix” for coffee mixtures or “3 in 1” for paints)?
‐ How can a business proof that it has goodwill?
• Misrepresentation: Is the public deceived?
Tort of Passing Off
If the tort of passing off is
established, the defendant:
may be liable for losses,
may have return profits and
may be subject to an
injunction.
Tort of Passing Off
•Note: instead of or in addition to
suing in passing off, it may be
possible for the plaintiff to sue
for trade mark infringement in
some circumstances, under the
Trade Marks Act.
International Comparisons
Is there civil liability for matters other
than breach of contract; ie: torts ?
India
Yes
China
Yes ‐ but not so wide/more limited
US
Yes
Malaysia
Yes
Summary
• A tort is a recognised civil wrong (other than breach of
contract) which gives rise to a civil remedy.
• There are many kinds of torts, but in the business context,
the following 3 are very common:
(a) Negligence
(b) Vicarious Liability
(c) Passing Off
• Each of these are subject to their own rules.
• Note: It may sometimes be possible for a plaintiff to sue
under contract and tort or one tort and another tort – but
the plaintiff will only get one set of damages.
Reading
•Chapter 13 of RC and/or Chapter 18 of
TB.
•Note: “tort of conspiracy” is not in the
syllabus, but you may wish to read it for
your own purposes.
SEMINAR 10
Torts
• A tort is a recognised civil wrong (other than breach of
contract) which gives rise to a civil remedy.
• Some examples of torts include:
Assault and Battery
Defamation
Deceit
Conversion
Confidence
Passing Off
Vicarious Liability
Negligence
A. Tort of Negligence
•The most common tort affecting
businesses, is the tort of negligence.
•For there to be liability in
negligence, there does not have to
be a contract between the parties,
but the following 4 factors must be
established:
(2)
Breach
(1)
Duty of Care
Negligence
(4)
Remoteness
(3)
Causation
(1) Duty of Care: Test
• In order to establish that the defendant owes the
plaintiff a duty of care, in law:
(a) The relationship between the plaintiff and the
defendant must be close and proximate and
(b) There must not be any policy considerations
negating a duty of care.
(1) Duty of Care: Some well‐established
areas
• Road users – to other road users
• Doctors/lawyers/accountants/bankers/service
providers – to their clients
• Manufactures/distributors/importers – to
consumers where there is death, physical injury or
property damage
• Transporters – to owners of goods/passengers
• Employers – to employees
• Owners of premises – to visitors
(1) Duty of Care
• In some areas: well‐established that there is a duty
of care.
• In some areas: well‐established that there is no
duty of care.
• But there are many categories in between.
• Two such situations:
(a) Negligent misstatements
(b) Pure economic loss
(1)a Duty of Care: Negligent Misstatements
•Can there be liability for a negligence
misstatement as opposed to a negligent
act?
•The answer is ______.
•However, there is a possibility of
unlimited liability and hence courts are
more hesitant to find a duty of care.
(1)a Duty of Care: Negligent
Misstatements
• Duty of care in respect of negligent misstatements
is likely to be established in more constrained
circumstances such as when (Caparo’s case):
(a) The defendant knows that the information was
required for the transaction contemplated,
(b) The defendant knows that it would be
communicated to the plaintiff,
(c) The defendant knows that the plaintiff would rely
and
(d) The plaintiff did rely.
(1)b Duty of Care: Pure Economic Loss
•Pure economic loss refers to pure
financial loss which is not accompanied
by physical injury, death or property
damage.
•If pure economic loss is claimable, there
could be unlimited liability and hence
courts are more hesitant to find a duty
of care.
(1)b Duty of Care: Pure Economic Loss
•However, where it is not a case of
unlimited liability and there is very
close proximity between the parties
(eg: not an unknown person suing) –
it may be claimable (RSP Architect’s
case).
(2) Breach of Duty of Care: Test
•To see if the duty of care has been
breached: must see how another
reasonable man would have acted in the
circumstances.
•Eg: if you are driving and knock
someone down, is it a forgone
conclusion that you have breached your
duty of care and hence are liable?
(2) Breach of Duty of Care
• If the defendant professes to have some skill, who would
another “reasonable man” refer to in this context?
• In determining how another reasonable man would have acted,
it may be necessary to balance: risk and cost of taking
preventive measures.
Eg: If a child falls over a tiger’s enclosure in a zoo and is mauled
by the tiger, has the zoo breached its duty of care? What else
could the zoo have done, taking into account cost and risk?
(3) Causation
•This means that even though the
defendant owed a duty of care and
he breached it, if the loss the
plaintiff is suing for is not caused by
the defendant, the defendant would
not be liable.
Barnett v Chelsea & Kensington Hospital
• Plaintiff’s husband came to defendant’s hospital, complaining
of vomiting, but hospital told him to go home and consult his
own general practitioner.
• Later plaintiff’s husband died – because of arsenic poisoning.
• Plaintiff sued hospital for not treating her husband.
• Court held the hospital breached the duty, but was not liable.
• This was because there was medical evidence that even if the
hospital had treated the husband, the husband would have
died anyway because he came to the hospital at a very late
stage.
• Thus the hospital’s negligence did not CAUSE his death.
(4) Remoteness
•Damages cannot be too remote.
•It would be too remote if it was not
reasonably foreseeable.
•Eg: if you knock down a person and he
dies, can his parent sue you the cost
of having another child through IVF –
or is that too remote?
Defences
• There are some defences open to the defendant
when sued in negligence:
(a) Voluntary Assumption of Risk; ie: the plaintiff
voluntarily agreed to or consented to the loss. If
established, defendant will totally not be liable.
(b) Contributory negligence: the plaintiff also
contributed to the loss. If established, damages will
be reduced.
Case Example: Sayers v Harlow
•Plaintiff found herself locked inside a
toilet.
•So – in an attempt to climb out – she
stepped on the toilet roll – which “true to
its mechanical requirements rotated”.
•She fell and injured herself.
•Was she contributorily negligent?
Defences
(c) Another defence: Exclusion/limitation
Clause:
‐Under UCTA – cannot exclude liability
for ________________.
‐Under UCTA – can exclude liability for
other losses if the clause is __________.
B. Tort of Vicarious Liability
• The employer/principal can be vicariously liable for
employee’s/agent’s actions, if:
(a) The employee/agent has committed a legal wrong
and
(b) The wrong takes place in the course of
employment/duty.
• Note: a wrongful act can take place in the course of
employment/duty even if it is negligently or
fraudulently or intentionally done.
• However, what is and what isn’t in the course of
employment/duty is a question of degree.
Case Example: Koh Get Kee v Low Beng Hui
•An off‐duty police officer who was in
uniform and armed, went on a
drinking spree with his friend.
•He then accidentally shot the friend.
•Were his employers vicariously liable?
•What if the police officer had shot his
wife at home after a quarrel?
•What if there was also something
wrong with the revolver due to the
employer’s fault?
B. Tort of Vicarious Liability
•If the employer/principal is made
vicariously liable, can he in turn take
action against the employee/agent?
•Note also: while an employer/principal
can be vicariously liable for the wrongful
acts of his employee/agent, he would
not be vicariously liable for wrongful
acts on independent contractors. Why?
C. Tort of Passing Off
• To establish tort of passing off, the following 3 factors must be satisfied:
Good
Will
Misrepr
esentati
on
Passing
Off
Likely to
• Goodwill:
suffer
loss
‐ What can a business have a goodwill over?
‐ Can a business have goodwill over common descriptive words (eg:
“Coffeemix” for coffee mixtures or “3 in 1” for paints)?
‐ How can a business proof that it has goodwill?
• Misrepresentation: Is the public deceived?
Tort of Passing Off
If the tort of passing off is
established, the defendant:
may be liable for losses,
may have return profits and
may be subject to an
injunction.
Tort of Passing Off
•Note: instead of or in addition to
suing in passing off, it may be
possible for the plaintiff to sue
for trade mark infringement in
some circumstances, under the
Trade Marks Act.
International Comparisons
Is there civil liability for matters other
than breach of contract; ie: torts ?
India
Yes
China
Yes ‐ but not so wide/more limited
US
Yes
Malaysia
Yes
Summary
• A tort is a recognised civil wrong (other than breach of
contract) which gives rise to a civil remedy.
• There are many kinds of torts, but in the business context,
the following 3 are very common:
(a) Negligence
(b) Vicarious Liability
(c) Passing Off
• Each of these are subject to their own rules.
• Note: It may sometimes be possible for a plaintiff to sue
under contract and tort or one tort and another tort – but
the plaintiff will only get one set of damages.
Reading
•Chapter 13 of RC and/or Chapter 18 of
TB.
•Note: “tort of conspiracy” is not in the
syllabus, but you may wish to read it for
your own purposes.
