Law for Accountants- Law of Tort.

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  • Created by: ElishaG
  • Created on: 11-01-20 17:01
What is the law of tort?
Tort is a civil wrong other than a breach of contract. It's a breach of legal duty or an infringement of legal right which gives rise to claim for damages.
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What are examples of law of tort?
1)Nuisance-private(noise,trees,smell) public (obstructing highway).2-Trespass land,person.3)Passing off-trying to pass off product when it's somebody else's.
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What is the tort of negligence?
Breach of a legal duty to take care which results in damage to another.
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What are key elements of the tort of negligence?
1)Injuria. 2)Damnum.
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What is injuria?
Breach of legal duty, legal 'injury'-i.e. invasion of another's rights.
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What is Damnum?
resulting loss suffered by the other party including financial loss and physical injury
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Who are the respective parties to a tort?
1)Party who suffers the wrong 'tortfeasee'. 2)Party liable for tort is 'tortfeasor'. Motive is irrelevant- Willaims v Humphrey 1975.
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What happened in Williams v Humphrey 1975?
Facts-Defendant pushed claimant into swimming pool, C broke ankle. Didn't intend to hurt Claimant.Held-irrelevant as he intended to touch claimant.
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What are the steps in an action for negligence?
1)Duty of care. 2)Breach of duty. 3)Causation/resultant damage.
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What is duty of care?
Duty to take reasonable care not to cause foreseeable harm to others.
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Which case relates to duty of care?
Donoghue v Stevenson 1932.
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What happened in Donoghue v Stevenson 1932?
Facts-Mrs D went to cafe with friend, who bought her ginger beer.Decomposed snail at bottom of bottle-made her physically unwell. Sued manufacturer, they were under duty to see outside bodies didn't get into ginger beer.
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What was held as a result of Donoghue v Stevenson 1932?
Held-Duty on behalf of manufacturer to take reasonable care in the manufacture of products and in preventing injury.
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Who is duty of care owed to?Which cases relate to this?
Direct victim of negligence but may extend to others for nervous shock.Bourhill v Young 1943. Chadwick v British Railways Board 1967. White v Chief constable of South Yorkshire police 1998.
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What happened in Bourhill v Young 1943?
Facts-Motorcyclist killed in accident he was responsible for-pregnant woman got off tram, saw accident and suffered shock-caused premature labour and loss of baby. Brought claim related to nervous shock and resulting loss.
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What was held as a result of Bourhill v Young 1943?
Held-Motorcyclist didn't owe duty of care to pregnant woman as she wasn't a foreseeable victim. She wasn't present at scene of accident, arrived after accident occurred.
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What happened in White v Chief constable of South Yorkshire police 1998?
Facts-Claimants police constables on duty at Hillsborough.Policemen suffered PTSD from event.4 at stadium on duty.1 responsible for ********* bodies and completing casualty forms at hospital. Claimed compensation for psychiatric injury.
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What was held as a result of White v Chief constable of South Yorkshire police 1998?
Held- Rejected claim as they were secondary victims. Secondary victim-someone whose personal safety isn't threatened, but suffer psychiatric injury.To satisfy claim, must meet three requirements.
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What are the 3 requirements/proximities for secondary victims?
1)Close relation-parent,spouse etc.2)Time and space-have to witness event and immediate aftermath.3)Direct perception-have to witness it with unaided senses.
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What are factors to consider for breach of duty?
1)Probability of injury.2)Seriousness of risk.3)Social utility and benefit-.4)Practicality and cost.5)Lack of skill.6)Res ipsa loquitur (facts speak for themselves).
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Which case relates to probability of injury?
Bolton v Stone 1951.
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What happened in Bolton v Stone 1951?
Facts-Stone injured when hit by cricket ball outside home. Cricket ground had fence and was sunken into ground.Very rare for ball to leave ground.Held-No breach of duty, cricket ground had been there 90 years with no other injury.
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Which cases relate to seriousness of risk?
Paris v Stepney Borough Council 1951.
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What happened in Paris v Stepney Borough Council 1951?
Facts-Claimant was mechanic who had one eye, hit stiff bolt with hammer, piece of metal flew off and hit him in eye, causing him to be totally blind.Held-employer should've taken more care as he already was blind in 1 eye, he should've worn goggles.
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Which case relates to social utility and benefit?
Watt v Hertfordshire County Council 1954.
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What happened in Watt v Hertfordshire County Council 1954?
Facts-RTA victim trapped, lifting jack needed, officer sends firemen to get jack, jack slips and breaks Watts' leg. Held-deemed a reasonable risk to take to save a life.
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Which case related to Practicality and cost?
Latimer v AEC Ltd 1952.
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What happened in Latimer v AEC Ltd 1952?
Facts-Factory flooded, production suspended until sawdust and floor mopped, wet floor signs up.Claimant went to work and slipped.Held-Employers took sufficient accident so weren't negligent.
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Which case relates to lack of skill?
Nettleship v Weston 1971.
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What happened in Nettleship v Weston 1971?
Facts-Learner driver drove recklessly, caused passenger to break leg.Tried to say she wasn't responsible as she was a learner.Held- Learner expected to meet same standard as normal driver.Damages reduced to 50% as claimant pulled handbrake.
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Which case relates to Res ipsa loquiter?
Scott v London & St Katherine's docks 1865.
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What happened in Scott v London & St Katherine's docks 1865?
Facts-Claimant injured when bags of sugar fell and struck on head.Held-Liable as facts speak for themselves and defendant couldn't prove they hadn't breached duty.
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What is causation in fact?
Damage must be direct consequence of negligence.
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What case relates to the 'but for' test?
Barnett v Royal Chelsea Hospital 1969.
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What happened in Barnett v Royal Chelsea Hospital 1969?
Facts-Barnett goes to A&E feeling nauseous, dies waiting in A&E. Hospital failed to examine him but didn't cause death as he had arsenic poisoning. Held-hospital not liable as would've died anyway.
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What is causation in law? What case relates to this.
Damage must've been reasonably foreseeable at time of negligence. Wagon Mound 1961.
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What happened in The Wagon Mound 1961?
Facts- Vessel leaked oil, cotton debris ignited and oil caught fire.Held-Defendant liable for full extent.
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What is novus actus interveniens?What case relates to it?
New intervening act- breaks chain of causation. Lamb v Camden LBC 1981.
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What happened in Lamb v Camden LBC 1981?
Facts-Council failed to maintain water pipes. Lamb moved out and squatters moved in causing, damage. Lamb tried to sue council for damage done by squatters.Held-council not liable,
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What is the 'thin skull' principle? What case relates to it?
Take your victim as you find it. Smith v Leech Brain & Co 1962.
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What happened in Smith v Leech Brain & Co 1962?
Facts-molten zinc drips on lips, Smith gets cancer and dies. Widow tries to claim under fatal incidents act. Held-Defendant responsible for death.
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What is contributory negligence? What case relates to it?
Court may reduce the amount of damages paid to claimant if he contributed to own injury or loss. Sayers v Harlow 1958.
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What happened in Sayers v Harlow UDC 1958?
Facts-woman gets locked in public toilet, stands on toilet roll holder, which rolls, she falls and hurts herself.Held-award reduced as she contributed to own injury.
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What is a defence to negligence?What case relates to it?
Volenti non fit injuria- no wrong is done to one who consents. ICI v Shatwell 1965.
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What happened in ICI v Shatwell?
Facts-Employees ignored rules and regs, which resulted in their injury.Held-workers ignored employees instructions
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What is vicarious liability?
Liability of one party for actions or omissions of another party with whom the person has a special relationship.
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What is an example of vicarious liability?What case relates to it?
Employer vicariously liable for actions of employee when they act in course of employers business. Limpus v LGO 1862. Beard v LGO 1900.
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What happened in Limpus v LGO 1862?
Facts-2 bus drivers racing back to depot, one overturns, injuring passengers. Held-LGO responsible.
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What happened in Beard v LGO 1900?
Facts- Conductor moves bus, reverses it and hits pedestrian.Held-LGO not liable as he stepped out of normal employment duties.
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What are cases from auditors liability?
1)ADT Ltd v BDO Binder Hamlyn 1995.2)RBS v BJM 2002.
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What happened in ADT ltd v BDO Binder Hamlyn 1995?
Facts- BDO auditor assured ADT that Britania Security's accounts were genuine. ADT bought BS for £104m but it was only worth £40m.Held-ADT won in court,BDO appealed and out of court settlement occurred
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What happened in RBS v BJM 2002?
Facts-Bannerman auditors. APC goes into insolvency, owes RBS £13m. RBS sue Bannerman.Held-RBS awarded claim.
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How could the previous case have been prevented?
Disclaimer in audit report.
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What are methods used to restrict liability of auditors?
1)Professional indemnity insurance- ACCA,ICAEW must have it.2)Incorporation.3)LLPs.4)Liability limitation agreements.
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What are management and those charged with corporate governance responsible for?
1)Preventing and detecting fraud.2)Strong control environment. 3)Good corporate governance. 4)Establishing policies and procedures.
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What are auditors responsible for?
1)Professional scepticism. 2)Risk identification and assessment. 3)Consider potential impact on financial statements.
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Card 2

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What are examples of law of tort?

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1)Nuisance-private(noise,trees,smell) public (obstructing highway).2-Trespass land,person.3)Passing off-trying to pass off product when it's somebody else's.

Card 3

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What is the tort of negligence?

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Card 4

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What are key elements of the tort of negligence?

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Card 5

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What is injuria?

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