Enterprise Law Case Study: Analyzing Negligence, Duty & Liability

This Enterprise Law case study analyzes two distinct scenarios involving negligence, duty of care, and vicarious liability. The first scenario examines the potential liability of Australia Post for the negligent actions of its employees who mishandled a package containing live snakes, leading to physical injuries to two individuals. The analysis applies principles of tort law, including duty of care, breach of duty, and causation, ultimately concluding that Australia Post could be held vicariously liable. The second scenario assesses the duty of care owed by a financial advisor, Merlin, and his employer, BNQ, to a family with limited business knowledge who suffered economic loss due to negligent financial advice. Applying relevant case law, the analysis determines that both Merlin and BNQ breached their duty of care and could be held liable for the family's economic loss. Desklib provides access to similar case studies and solved assignments for students.

2018
Enterprise Law
Student’s Name

Enterprise Law 1
Contents
Issue.................................................................................................................................................2
Rules.............................................................................................................................................2
Application...................................................................................................................................3
Conclusion...................................................................................................................................4
Question 2........................................................................................................................................4
Issue.............................................................................................................................................4
Rules.............................................................................................................................................4
Application...................................................................................................................................5
Conclusion...................................................................................................................................5
References........................................................................................................................................6

Enterprise Law 2
Issue
The issue is to check that whether Meghan and Catherine can initiate an action under Negligence
factor of Tort Law and if yes then to whom they can sue.
Rules
Negligence is a significant term of Tort Law. This is a situation where a person owes a duty of
care in respect to other one and cause of his/her negligence the other person suffers from a
loss/damage (ACCC, 2018). The duty of care is a mandatory term to establish a case of
negligence. It is very general that people act negligently in many of the situations where they
need to behave like a reasonable person Breach of such duty is another important aspect of a case
of negligence (E-law Resouces, 2018).
The loss must be there and the same can be in form of Personal injury, economic loss, and
psychiatric injury. It was held in the case of Barnett v Chelsea & Kensington Hospital [1969] 1
QB 428 that loss must be a direct result of the negligent act of defendant in a case.
Vicarious Liability:-
This is another important aspect of Tort Law. This is a term that can apply in those cases where a
person commits a tort act while doing conduct on behalf of other. The term is closely connected
to the employee-employer relationship. According to the concept of vicarious liability an
employee while performing his job, act similar to an agent of his principal i.e. employer (Steele,
2017). The law of agency applies in such cases and accordingly an employer is liable for a Tort
committed by his/her employee. A claimant can sue the employer for a tort conduct of his/her
employee.

Enterprise Law 3
Application
In the given case, two of the employees of Australia Post were engaged on sorting mail and
found a suspicious parcel. They had reason to believe that something is wrong with the box and
therefore they have placed the parcel in an unlocked cupboard, although they have called the
police to find out the issue. There were many live snakes in the box. The issue in the case started
when snakes went out of the box and premises of Australian post. They were walking onto the
streets outside. Meghan, one of the pedestrian on that road saw the snakes and cause of this she
got a heart attack.
In addition to Meghan, the snake bit Catherine, another person. When she went to the doctor, the
doctor failed to provide a proper medicine to Catherine and therefore she became unable to walk
anymore.
Here, applying the provisions of Tort law, Harry and Will owed a duty of care in respect of
Meghan and Catherine. When they were aware that the parcel holds something dangerous they
must not have kept the same in an unlocked box. By doing this, they failed to perform their duty
of care. In addition to this two conditions, further the third condition i.e. the existence of loss is
also been satisfied in the form of physical injury, as Meghan suffered from a heart attack and
Catherine suffered from a permanent injury of the leg. Applying the provisions of Barnett v
Chelsea & Kensington Hospital, this can be stated that these physical injuries were the direct
reason of the negligence of Harry and Will.
Applying the provision of Vicarious Liability in the case, Australia post is seems to be held
liable for the negligence of it is guilty employees i.e. Harry and Will

Enterprise Law 4
Conclusion
In conclusion, this is to be stated that all the necessary conditions of negligence are satisfied
here. Australia post will be held liable for the negligent act of Harry and Will. Meghan and
Catherine are the victims of personal injury and therefore can sue Harry and Will and also their
employer that is Australian Post.
Question 2
Issue
To advise the family that is there any duty of care exist in the case and if yes then at the end of
which person?
Rules
The duty of care is an obligation where one person is required to behave similarly to a reasonable
and responsible person (Legal Dictionary, 2018). Some of the relationships are defined under the
law where one person owes a duty of care in respect to others. These relationships are doctor-
patient, father-son, and solicitor-client and so on (Lewis and Owen, 2014). Whether a duty of
care exists or not in a transaction, depends on the relationship between the parties. It was held in
the case of Caparo Industries Plc v Dickman [1990] 2 AC 605, that duty of care will be there
when a defendant can foresee the possible risk. Although it is required that there must be a direct
loss to the victim cause of this negligence. Under the concept of Vicarious Liability, the
employer is liable for the breach of the duty of care by his/her employees (Laws, 2018).

Enterprise Law 5
Application
In the given case, a family of three members is a center. The young member of the family was
not able to move from wheelchair. Further, the elder one i.e. parents of the young man were not
so good in English and in addition to this, they had no knowledge and experience of business. In
such a circumstance, it was the liability of Merlin the employer of BNQ, a financial institution to
provide the best financial advice to the old couple. Applying the provisions of Caparo Industries
Plc v Dickman , Merlin can foresee the involves risk in the subjective transaction. Here Merlin
being a financial advisor owed a duty of care towards the family and he further breached the
same by providing wrong advice to them.
In conjunction with this, he also stopped attending the calls of the old couple. Cause of wrong
advice of Merlin, the family has suffered from an economic loss. Here, Merlin owed a duty of
care and the same can be held liable. In addition to Merlin, his employer BNQ will also be held
responsible cause of application of Vicarious Liability rule.
Conclusion
Two of the persons owed a duty of care, one is Merlin himself, and another one is his employer.
They breached their duty and cause of this the family had to face economic loss. Both Merlin and
BNQ financial institution can be held liable for the breach of duty.

Enterprise Law 6
References
ACCC. (2018) The Tort of negligence. [online] Available from:
https://www.accaglobal.com/ca/en/student/exam-support-resources/fundamentals-exams-study-
resources/f4/technical-articles/tort-negligence.html [Accessed on 09/09/2018]
Barnett v Chelsea & Kensington Hospital [1969] 1 QB 428
E-law Resouces. (2018) Negligence. [online] Available from:
http://e-lawresources.co.uk/Negligence.php [Accessed on 09/09/2018]
Laws. (2018) A Quick Guide To Vicarious Liability. [online] Available from:
https://tort.laws.com/vicarious-liability [Accessed on 09/09/2018]
Legal Dictionary. (2018) Duty of Care [online] Available from: https://legaldictionary.net/duty-
of-care/ [Accessed on 09/09/2018]
Lewis, J., R., and Owen, S. (2014) Law for the Construction Industry. USA: Routledge.
Steele, J. (2017) Tort Law: Text, Cases, and Materials (4th edition) Oxford: Oxford University
Press.