Legal Issues and Relevant Laws in a Case of Negligent Advice and Breach of Contract

Contents
Issue 1..............................................................................................................................................2
Relevant Law...............................................................................................................................2
Application of law........................................................................................................................2
Conclusion...................................................................................................................................2
Issue 2..............................................................................................................................................2
Relevant Law...............................................................................................................................2
Application of law........................................................................................................................2
Conclusion...................................................................................................................................3
Issue 3..............................................................................................................................................3
Relevant Law...............................................................................................................................3
Application of law........................................................................................................................3
Conclusion...................................................................................................................................4
Reference List..................................................................................................................................5

Issue 1
Can the council be sued by Ellen for the advice received by her through its employee?
Relevant Law
When any employer hires an employee, then, any act carry on by an employee within
employment and as per the guidance of the employer will make an employer liable under
vicarious liability. (Sykes 1988)
As per Hollis v Vabu [2001], the vicarious liability is applicable only when the parties are
sharing the relationship of an employer- employee. Any consequences that flow from any act
that is carried out by the employee within his employment and as per the guidance of the
employer, will make the employer liable. As per Deatons Pty Ltd v Flew [1949], if the acts are
of personal nature, then, it will not make the employer answerable for the consequences that
follow from such acts of the employee.
Application of law
Ellen on the basis of the advice of the employee of the council enters into a lease agreement with
the landlord. The advice was furnished by the employee when he was under the employment of
the council and the employee just had a glance at the computer (wherein the information is
gathered by the council) before the advice is provided. So, the acts of the employee are within
his employment course and are not personal in nature.
Because of the advice, Ellen suffered damages as the advice was given negligently as the
employee submitted that there would be no construction activity that will be carried near the
lease premises, but, in reality there was a construction work that will take place near the
premises. So, because of the acts of the employee, the council is held liable under the law of
vicarious liability.
Conclusion
The council is held answerable to the acts of the employee as the loss caused to Ellen is suffered
by her by relying on the negligent advice of the employee.
Issue 2
Whether the landlord can sue Ellen for non-payment of the rent?

Relevant Law
Every contract is an enforceable agreement. The parties must comply with the contract terms and
if there is breach then the aggrieved party can sue the defaulting party. If the term is violated
which is the contract essence and without which a contract cannot be performed, then, such
terms are called conditions and the aggrieved party can cancel the contract and sue for losses
(Poussard v Spiers and Pond (1876). But, when the terms are not essential then the contract
cannot be cancelled and only losses can be attained (Bettini v Gye (1876). (Latimer 2012)
Application of law
The employee when provide advice to Ellen, then, Ellen entered into a lease with the landlord.
But, later the advice was found to be negligent and the construction activity was carried on near
the site resulting in loss to the business of Ellen. Because of business loss Ellen was not able to
pay the rent to the landlord. Now, the non-payment of rent to landlord is breach of the core term
of the lease agreement. Thus, Ellen is in violation of a condition and thus the landlord can sue
cancel the contract and sue for damages.
Conclusion
Ellen can be sued for breach of contract for non-payment oif rent as it is a breach of a condition
and sue for damage.
Issue 3
Whether the Council worker is liable for making negligent misstatement towards Ellen?
Relevant Law
The Tort of negligence is a common law which emphasis on penalizing the defendant for his
wrongful acts which has caused damage to the plaintiff (Donoghue v. Stevenson [1932]. In
Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] the law of negligence is applicable to the
wrongful advice. The main essential includes:
i. Duty of care – The defendant when giving advice must make sure that the
statements should not harm the plaintiff who is relying on such advice.