A Detailed Report on Aspects of Contract and Negligence for Businesses

This report delves into the legal aspects of contract and negligence within a business context. It begins by contrasting the nature of liability in contract law with that in tort law, highlighting the key differences in terms of the basis of liability, the relationship between parties, the measurement of damages, and the reasons for occurrence. The report then focuses on the application of the elements of torts of negligence, including the duty of care and breach of duty, using case scenarios to illustrate these concepts. Furthermore, it explores the concept of vicarious liability, explaining how businesses can be held liable for the actions of their employees, and provides examples to clarify this principle. The report concludes by summarizing the key takeaways, emphasizing the importance of understanding both contract and tort liabilities for businesses and the implications of vicarious liability. It uses cases to exemplify the discussed concepts. This document is contributed by a student on Desklib, a platform that provides AI based study tools for students, offering valuable insights into business law.

Aspects of Contract and Negligence
for Businesses
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TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................3
TASK 3............................................................................................................................................3
4.1 Applying elements of tort of negligence and possible defences............................................3
3.1 Contrast nature of liability in contract with the liability in tort.............................................3
3.2 Nature of liability...................................................................................................................4
TASK 4............................................................................................................................................6
4.2 Vicarious Liability.................................................................................................................6
3.3 Business can be vicariously liable.........................................................................................6
CONCLUSION................................................................................................................................6
References........................................................................................................................................8
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INTRODUCTION
In order to enter in a valid contract it is essential for the parties to follow legal process
that will aid in guaranteed their interest if one party neglect to execute the requirement
(Levinson, 2005). Law is termed as the political concept and legislation that is in existence
implemented by the government to govern the society and interest of parties who are in the valid
contract. Presently, the report will focus on contrasting the different nature of liability in
'contract' with the nature of liability in 'tort'. However, the report will further focuses on the
applying different elements of torts of negligence for the business and state possible defences
from cases.
TASK 3
4.1 Applying elements of tort of negligence and possible defences
According to the case scenario, Albert applies to be tenant and provides his accounts
details to the landlord brad. Brad further reference relating to Albert financial position but the
accountant carelessly do not bother to check the file that recommend him as good tenant. After
some months Albert disappears by taking flat and also run up several thousand pounds worth of
rent arrears. In such situation Brad is liable to recover his losses from Charles. However, with the
help of occupiers liability act. The Possible defences under this include Volenti non fit injuria,
Contributory negligence and Ex turpi causa (Introduction to Tort Law, 2012).
3.1 Contrast nature of liability in contract with the liability in tort
Basis of difference Contractual liability Tort liability
Definition Contractual liability arises
from the failure of term.
Tort liability arises from
breach of duty.
Relation of parties In contractual liability, parties
are well-known to each other.
Liability arises due to their
written agreement relationship
(Hassett, 2012).
In tort, obligation is
obligatory by law. Parties
are strangers with each
other. They are constrained
by law to come into a
judicial relationship.
Measurement of damages In contractual liability, In tort, damages are
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damages are determined on
the basis of deed among the
parties.
determined by court of law.
It is matter of fact or
situational approach.
Awarding damages The main aim for awarding
damages is to compensate the
innocent parties for the breach
contract.
Under tort liability
damages are being
provided to balance the
loss that have bee occurred
to the victim party (Balzer,
Eugster and Meyer, 2006).
Reason of occurrence Contractual liability come into
existence when one party
breaches the contract by not
meeting the required terms
and condition of the
agreement (Zamore, 2014).
However, liability of tort
applies when parties do not
respect their responsibility
that result in offending the
innocent parties.
Case precedent Poussard V Spiers Donogue V Stevenson
3.2 Nature of liability
Negligence is defined as the tangled activities that are performed by the party when the
other party fails to achieve their duty of care and even outcome in causing damages to the
innocent party (Taylor, 2011). According to the nature of liability in negligence the parties are
obliged and mandatory to take care regarding their activities and duties so that their actions may
not harm the other parties. However, there are various principles of negligence that need to be
take care that is:
1. Duty of care – According to the negligence law, suspect must have responsibility to take
care of their actions and activities so that they should lower the chance of harm to the
other party (Smith and Atiyah, 2006). According to the case scenario, Brad accountant
need to check the file of Albert and check his financial situation as it is their duty to
check it properly while renting the flat.
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2. Breach of duty – Another principle of negligence law is breach of duty according to
defendant is not taking attention regarding their generic and specific role &
responsibilities thus, outcome in neglecting their duties. As per the case scenario, it's the
duty of Brad accountant to measure the financial condition of Albert while he does not
bother to check their file that result in rent arrears.
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TASK 4
4.2 Vicarious Liability
Vicarious liability basically refers to as a liability of an employer due to the illegal act of
their employees on a third party (Collins, 2003). Also, employee is also liable for his part of
mistake due to which third party got injured or damaged. As per the case, Bill, a milkman hired
14 year old boy for the milk delivery in order to express prohibition form XYZ Dairies. This
information was known by the dairy but they ignored. One day due to the careless driving of
Bill, a boy got injured at the time of milk delivery.
As per the law, Bill fails to perform the duty of care due to negligence and Bill can be
held responsible but he has hired a minor and according to the English Law, if one of the party is
minor than contract becomes void and in the eyes of law that contract is voidable. So, a boy
cannot sue Bill for the negligence (Taylor, 2011).
On the other hand, XYZ Dairies are held responsible under vicarious liability because,
Bill was their employee and he did the wrongful act of hiring a 14 year old boy for working
which is illegal in UK. Even after knowing about the fact, they did not respond towards his
action, thus, XYZ Diaries are held responsible under vicarious liability for the illegal act of Bill.
Although, Bill is responsible for hurting a boy under vicarious liability.
3.3 Business can be vicariously liable
As per the case, museum owner asked his friend to drive a vintage bus because they were
taking part in a rally but due to the negligence of his friend, a bus hit the car of Mrs. Smith.
Under the vicarious liability, museum owner will be held responsible because a person who was
driving the bus was given permission for driving from the owner and thus, due to the negligence
wrong act happened (Cohen, 2009).
On a contrary, an owner cannot be held responsible because the person who was driving
was not his employer and he was only his friend. Thus, under vicarious liability owner is
responsible for the wrongful act of his employee only and not of other's wrongs.
CONCLUSION
Conclusively it can be said that report has concluded that there is difference between
liability in contract with the liability in tort. As, liability in contract rise due to unacceptable
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performance while in tort it originate due to different neglectful acts. According to vicarious
liability, business should take care of health and safety issues else they will be held liable for the
negligent act of their employees.
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REFERENCES
Books & Journals
Balzer, S., Eugster, P. T. and Meyer, B., 2006. Can aspects implement contracts?. In Rapid
Integration of Software Engineering Techniques. Springer Berlin Heidelberg.
Cohen, G. M., 2009. The Fault that Lies Within Our Contract Law. Michigan Law Review, pp.
107.
Collins, H., 2003. The law of contract. Cambridge University Press.
Smith, S. A. and Atiyah, P. S., 2006. Atiyah's Introduction to the Law of Contract. Oxford
University Press.
Zamore, J. D., 2014. Interference with Lawful Business. Business Torts.
Online
Hassett, M., 2012. The extent of the duty. [pdf]. Available through:
<http://www.forsters.co.uk/cmsfiles/pdf/MJJH_PLJ_Occupiers%20Liability_050312.pdf>.
[Accessed on 7th December 2015].
Introduction to Tort Law. 2012. [Online]. Available through: <
http://2012books.lardbucket.org/books/the-legal-environment-and-government-regulation-
of-business/s10-introduction-to-tort-law.html >. [Accessed on 7th December 2015].
Levinson, J., 2005. Vicarious liability for international torts. [Online]. Available through:
<http://www.1cor.com/1158/?form_1155.replyids=282>. [Accessed on 30th November
2015]
Taylor, A., 2011. Offer and acceptance online. [Online] Available through:
<http://www.seqlegal.com/blog/offer-and-acceptance-online>. [Accessed on 7th December
2015].
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