HA2022 Business Law Case Study Assignment: Contract and Torts

This case study assignment addresses two key legal issues: breach of duty of care in a negligence scenario and the validity of consideration in a contract dispute. The first part examines whether an officer in charge breached their duty of care by improperly placing a jack in a vehicle, analyzing th...Read More

Running head: CASE STUDY ASSIGNMENT
CASE STUDY ASSIGNMENT
Name of the Student:
Name of the University:
Author Note:

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Answer 1:
Issue:
The issue involved in this case is whether officer- in- charge breached his duty of care
while placing the jack in a vehicle not specially designed to carry it.
Law/Rules:
In order to identify and determine whether a person has breached his duty of care, the
court generally considers the standard of care expected by a reasonable person in such
circumstances (Gibson, 2017). The standard of care means the care to be taken or not to be taken
by a person of reasonable knowledge, judgment and skill in that particular similar situation.
When the defendant in the particular case has performed his task or duty in an unreasonable
manner or his acts were not according to the standard of a reasonable man, then it is said that he
has breached his duty of care. However, before going further, it has to be proved that the
defendant has a duty of care which he has breached. The presence of duty of care has to be
determined by the neighbourhood test in reference of Donoghue v Stevenson [1932] AC 562.
This test consists of reasonable foreseeability of harm and presence of relation of proximity. The
harm or injury inflicted has to be such that it can be foreseen reasonably by any person and there
must be proximate relation between the cause and effect of the harm.
Once it is proved, that the defendant in the case has a duty of care to the claimant or
plaintiff, the claimant must show that the defendant is liable for breach of duty as seen in the
case of McHale v Watson [1966] HCA 13. The breach of duty is generally determined by the
objective test as observed in the case of Wyong Shire Council v Shirt [1980] HCA 12. This test

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is used to determine the standard possessed by a reasonable person as found in Vaughan v
Menlove [1837] 3 Bing NC 467.
While deciding whether has performed his duty as a reasonable person or has breached
his duty, the court usually considers four aspects mainly; the likelihood of harm, the seriousness
of harm, the cost of prevention and the usefulness of the conduct of the defendant.
The first aspect as mentioned above is likelihood of the harm caused. The defendant may
not give protection against any unforeseen events. It is expected from the defendants to guard
against the events that can be reasonably foreseen. This type of observation was made in Roe v
Minister of Health [1954] 2 WLR 915 by the Court of Appeal where the defendants were not
held liable as the risk was not reasonably foreseen.
The second aspect is seriousness of harm as discussed in the case of The Wagon Mound
No.2 [1967] 1 AC 617 by the Privy Council. In this case, the defendants have breached the duty
of care. Here in this case, though the likelihood of harm was low, however, the seriousness of the
harm was very high and no cost could be incurred to stop it from happening.
The third aspect to be considered in this regard is the cost of prevention. It is recognized
in the case of Latimer v AEC [1953] AC 643. In this case, the House of Lords held that the
defendants are obliged to take only reasonable precautions to reduce or eliminate the risk by
taking standard care. The defendant is not required to undergo any additional expenses to remove
the possible danger.
The final criterion looked upon by the court is the usefulness of the conduct of the
defendant. It was observed in the case of Watt v Hertfordshire [1954] 1 WLR 835, it was held
that no breach of duty was committed by the defendant. The reason cited by the court is that the

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emergency of the circumstances and the usefulness of the act of the defendant to save a life is
more important than taking precautions towards the claimant.
Another aspect of breach of care considered by the court is whether the breach is done by
a professional which is known as professional negligence. It is a breach of care to be taken by a
professional that causes some loss or damage.
Rules:
In the present case, it is seen that a bushfire brigade had a particular vehicle that can be
modified to handle a large jack in emergency situations. The vehicle was taken to be used on
another call when a call came for the need of the special jack to be used at a minor accident near
the fire brigade headquarters. The officer in charge on duty considering the emergency situation,
ordered to place the jack at the back of another vehicle available at the fire station.
In order to determine whether the officer in charge has breached his duty of care, firstly,
neighborhood test is to be applied. By following it, it is seen that the officer had a duty of care.
Again by applying the objective test, its four conditions are to be satisfied. Firstly, the likelihood
of harm is to be considered. Here the officer in charge is required to provide protection in
situations that can be foreseen. Here the officer in charge must be aware of the fact that the large
jack can be placed on the particular vehicle specifically designed for it.
This type of observation was found in the case of Haley v London Electricity Board
[1965] AC 778, where the defendants were held liable for breach of duty. In this case, some
workmen dug a trench on the pavement. They went for lunch without fencing the trench instead
they left a shovel & pick at one end and a punner at the other to warn the pedestrians. However,
the victim being blind tripped at the punner and fell down. Due to this, he injured his head and

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became deaf. The defendant was held for breach of his duty as it can be reasonably foreseen that
a blind man may walked down the pavement. Hence, they must be extra cautious about the
protection.
In this case study, it is seen the risk that a vehicle is specially modified to handle the large
jack to be used in the emergency situations. The officer in charge in spite of knowing it ordered
it to be placed at the back of another vehicle. Thus he was negligent to make that order as it was
reasonably foreseen that the jack is unsuitable for any other vehicle. He has a duty of care to
place it on the suitable vehicle which he did not due to which an accident occurred causing injury
to a person.
Conclusion:
From the above discussion, it is seen that officer in charge has breached his duty of care
by placing the jack in a different vehicle resulting the shifting of the jack causing injury to an
officer.
Answer 2:
Issue:
The issue involved here in this case study is between Rees and David, who is correct.
Laws:
In the law of contract, consideration is an important element without which no contract is
valid. It is related to the bargain of the contract (Gibson, 2017). It is known that the contract is
based on exchange of promises, where each party is both the promisor and promise. Both
the parties must receive some benefit at the cost of some loss. It must be something of value in

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the eyes of law as decided in the case of Thomas v Thomas [1842] 2 QB 851. One important rule
regarding law of consideration is that part payment of debt is not regarded as a valid
consideration for a promise to waive the balance or to release the debt in full. It was decided in
the famous Pinnel's case 1602 5 Rep, 117 by the Court of Common Pleas.
In the Pinnel’s case, the claimant was due to get 8 pounds 10 shillings. The defendant had
paid 5 £ 2 shillings and 2p. The claimant instituted a case against the defendant for the remaining
amount. It was held by the Court of Common Pleas that the claimant is entitled to get the full
payment even if they have agreed to accept less. Part payment of a debt is not regarded as the
valid consideration for any contract to waive the remaining unless at the request made by the
promisor, the promisee had made part payment either before the stilulated due date, or to a
different destination or with a chattel. This rule given by the Court of Common Pleas in the
Pinnel’s case was again confirmed by the House of the Lords in the case of Foakes v Beer (1883-
84) LR 9 App Cas 605.
In this case of Foakes v Beer, Dr Foakes owed Mrs Beer an amount of £ 2,000 after she
received a judgment in her favor against him in an earlier case. Dr Foakes agreed to repay
immediately an amount of £ 500 and the remainder by installments. Mrs Beer agreed to this offer
and further stated that she would not opt for enforcement of the payment unless he did not make
default in payment of installments. However, there was no mention of interest in the agreement
although the judgment debts are calculated with interest. Dr Foakes though paid all the
installments timely, yet Mrs. Beer sued him for the unpaid interest.
It was held in the above case that Dr Foakes was liable to repay the interest due to Mrs
Beer. The agreement between them accounts for the part payment of the debt and as per the rules

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enumerated in the Pinnel’s case this was not a valid consideration for a promise for not enforcing
the full amount.
However there are few exceptions to the rules given in the Pinnel’s case. They are when
the part payment is made by 3rd party as seen in the case of Hirachand Punamchand v Temple
[1911] 2 KB 330. Another exception is promissory estoppels which is an equitable doctrine
which in some situations can prevent a person to go back to a promise not supported by
consideration as seen in the case of Tool Metal Manufacturing v Tungsten [1955] 1 WLR 761.
However there are few conditions to avail the benefit of promissory estoppels as laid
down in the case of Hughes v Metropolitan Railway (1876-77) L.R. 2 App. Cas. 439 which gives
the requirements as follows; there shall be a pre existing contract which has been modified, there
has to be a clear and unambiguous promise, there must be a change in situation or position and it
will be against equity to permit the promisor to return back to the promise.
Application:
From the facts of the case, it is seen that David borrowed 100,000 $ from Rees on an
agreement that money would be repaid within a period of 120 days at the rate of 14 % interest.
After 120 days, David told Rees that he would be unable to pay the full amount and offered to
pay 90,000 $ by cheque then for full settlement of debt. Rees accepted it but later he claimed
remaining 10,000 $ together with interest. Here since David has accepted the payment as per the
full settlement of the debt, he cannot later waive this as he was stopped from denying anything to
which he had agreed before as it will be against the principle of equity. This is according to the
exceptions of part payment enumerated in the case of Pinnel’s case and case of Foakes v Beer.
Conclusion:

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Thus from the above discussion, it is observed that as per the exceptions laid down in the
case of Foakes v Beer, David is correct here.

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References:
Donoghue v Stevenson [1932] AC 562.
Foakes v Beer (1883-84) LR 9 App Cas 605.
Gibson, A. (2017). Business Law, 10th edition. Pearson.
Haley v London Electricity Board [1965] AC 778.
Hirachand Punamchand v Temple [1911] 2 KB 330.
Hughes v Metropolitan Railway (1876-77) L.R. 2 App. Cas. 439.
Latimer v AEC [1953] AC 643.
McHale v Watson [1966] HCA 13.
Pinnel's case 1602 5 Rep, 117.
Roe v Minister of Health [1954] 2 WLR 915.
The Wagon Mound No.2 [1967] 1 AC 617.
Thomas v Thomas [1842] 2 QB 851.
Tool Metal Manufacturing v Tungsten [1955] 1 WLR 761.
Vaughan v Menlove [1837] 3 Bing NC 467.
Watt v Hertfordshire [1954] 1 WLR 835.
Wyong Shire Council v Shirt [1980] HCA 12.