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Business Law A - N11120
Common and Civil Law


The purpose of law is…
- Avoid chaos and confusion
...

- Private regulates are relations wit other individuals
...


Equity is…
- Developed by chancellors, in dealing with petitions addressed to the king
from citizens complaining about the rigidity of the common law
...

- Acknowledges the common law and trues to provide an alternative
solution
...

- Discretionary remedies
...

- Less flexible in ability to hire and fire workers
...







1

Introduction to the English Legal System

Criminal law

The purpose of criminal law is…
- To regulate behaviour
...

- To preserve national security
...

- The state who prosecutes the defendant
...

- The crown court (for indictable offences)
...


The purpose of penalties is…
- Punishment
- Protection
- Rehabilitation
- Deterrence
- Examples being imprisonment, fines or community service
...


Civil law

The purpose of civil law is…
- To govern relationships between individuals
...


The parties to civil law are…
- Generally started by an individual (the claimant)
...




The case is heard at…
- The county court (this is where 90% of cases are heard)
...

- Specialised tribunal
...



2


The purposes of penalties are…
- To correct the wrong
...

- Examples of compensation being damages, injunctions, etc
...



English law

The unique characteristics of English law are…
- Long piecemeal development
...

- Judges create, as well as interpret the law
...

- Role of lay people
...


The EU has 4 main institutions…
- The council
- The European Commission
- The European Parliament
- The European Court of Justice

The 2 sources of EU regulation are…

1
...

- Together they form the ‘constitution’ of the EU
...
g
...
Secondary legislation
- Regulations e
...
Protecting the names of agricultural projects
...
g
...

- Decisions e
...
fining Microsoft for abusing their market position
...
Direct (Primary) Legislation
- E
...
Health and Safety at Work Act (1974)

2
...


The advantages and disadvantages of delegated legislation are

Advantages
Disadvantages
Speed
Certainty in the law
Flexibility
Laws passed by unelected
officials/bureaucrats
Technical/Local Knowledge











Judges may interpret acts but may not fill the gaps

To help them judges may use a number of tools…

1
...
External aids

- Interpretation Act (1978)
- Government reports
- Parliamentary reports

There are 3 judicial principles of statutory interpretation…

1
...

- The legislation is meant to be read literally; no interpretation is to be
used
...
The House of Lord interpreted a law saying that if a
person did not complete their tax return they were subjected to treble the
amount of tax they had to pay rather than just the remainder of what they
didn’t
...
The ‘Golden’ (purposive) rule
- An extension of the literal rule, used when the outcome of using the literal
rule would result in an absurd result
...

- The narrow meaning is when there are two meaning of a word so the
golden rule uses the one that does not give an absurd result
...

- R v Allen (1872)
3
...

- Smith v Hughes (1960)
...
Although
the law said it was illegal to solicit in a public place the Mischief law held
and they were found guilty
...


Depends on several factors such as…
- Court hierarchy
- Whether the facts come within the scope of the previous case
...


All of these courts
Supreme Court
except the Supreme
Court bind the ones
The Court of Appeal
below them to the
decisions that they
have made
...
Claim form filled

2
...




International law

The role of international regulations being…
- International law between countries rather than concerning domestic
issues
...

- May be enforced by the UN
...




























6

Contract law


-

A contract is a legally binding agreement between two or more parties
...

They can be in oral or written form
...
Consideration
- An agreement can’t amount to a contract unless each party gives some
‘consideration’ to the other e
...
a ‘promise’ to do something in the future
...
’

2
...

- Can be made to one person, a group etc
...


3
...

- If there is a contract between people in two different countries by
telecommunications, the place where the acceptance is received is the
place where the contract was made
...
g
...
The English company (Entores) wanted to sue for
damages but the court didn’t know where the contract was made as it was
over telex
...

- If a letter is posted, it becomes a valid contract as soon as it is put into the
post
...
If the offerer decided to do something against the
contract while it is in the process of being posted then they are in breach
of contract
...
g
...

- the offeror may specify manner of acceptance
...
g
...
Hugh said he sent the notice but Holwell



7

said he never received it
...





An invitation to treat is…
- Important to distinguish from an offer
...

- E
...
Partridge v Crittenden – Man posted a leaflet showing that he had a
rare species of hen that were not legal to put up for sale, someone sent
him a cheque and he sent them a hen in return
...
It was ruled that it was an invitation to treat
and not an offer so the charges were dropped
...

- Revocation, offer may be withdrawn at any time before acceptance, but
revocation must be communicated
...





























8

Contract Law - Consideration, Intention, Privity & Capacity

Consideration
- Essential element of a valid contract
...

- Consideration may e executed or executory
...

- Executed consideration occurs when one of the parties makes the offer or
the acceptance in such a way that he has completely fulfilled his liability
under the contract
...



Privity of a Contract
- Anyone who is not party to a contract cannot sue or be sued on that
contract
...

- Tweedle v Atkinson (1831) – Claimant married the daughter of William
Guy
...

William Guy died without paying the money that he promised
...
The
claimant not sue on the contract because he was not a part of it
...

- Contracts made by minors may either be valid, voidable or void
...
Contracts for necessary goods and services
- Defined as ‘goods suitable to the condition in life of the minor and hi
actual requirements at the same time of sale and delivery (Sale of Goods
Act 1973)
...

- Nash v Inman (1908) – A Saville Row tailor attempted to sue a wealthy
Cambridge student for clothes supplied, the clothes were 11 fancy


9



waistcoats
...

The common law also requires minors to pay a reasonable price for
necessary services
...
Beneficial contracts of service
- A minor can also validly make a contract of employment as long as the
contract is overall beneficial to the minor, it is the overall effect of the
contract when made which must be considered
...
Contracts which impose a continuing liability are voidable, includes leases
of land, partnerships and purchase of shares
...

- Effect is to release the minor from future liabilities, but would still be
bound by liabilities already accrued
...
Minors are not bound by contract for unnecessary goods or services, or
loans
- A loan made to a minor will not be enforceable unless they make a new
contract when they are of age
...

- If the minor no longer has the property supplied them they are under no
obligation to pay any compensation
...



















10

Contract Law – Terms




-

A contractual term is binding
There are 3 types of contractual terms…

1
...
Warranties
3
...

- If a condition is breached, then the injured party may both claim damages
and repudiate (opt out) of the contract
...

- Poussard v Spiers (1876)- Madame Poussard was employed to be an
opera singer but fell ill so missed her first four performances of her 3month contract
...
Missing the opening night was amounted to a breach of a condition
...

- If breached the injured party is only able to claim damages
...

- Bettini v Gye (1976) – Bettini was employed to be an opera singer on a 3month contract
...
Bettini fell ill so missed the first 3 days’ rehearsal
...
Bettini argued that it was only a warranty so he was only due
to pay damages
...


Innominate Terms
- The importance is determined at the time of the breach
...

- If the injured party is deprived of substantially the whole benefit of the
contract, he can treat the contract as repudiated and claim damages
...

- Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd (1962) – A
ship was chartered to defendants for 24 months, the engines were in poor
conditions and the crew were inefficient
...
Both decided that the ship was not
‘in every way fitted for ordinary cargo service’ so they were in breach
...

Judge said the term could not be clarified as a warranty or condition in
advance and the contract should not be terminated
...

- Implied terms are things that you don’t have to write into the contract
...
The Moorcock (1889)
brought about business efficacy
...

- May either be implied or express
- The remedy for breaking them are the same for breaching a contract
...

- Are not to be taken as fact because they are clearly untrue
...

- The buyer expects what they have been told to be true
...



Sale of Goods Act 1979

- Only applies to the sale of goods not services
...

- Cannot be excluded in consumer contracts, in other contracts it is allowed
only when reasonable
...
Seller has the right to sell the goods
2
...

3
...
Goods are of satisfactory quality
5
...

6
...





12

Exclusion/Exemption Clauses

- An express term which seeks to exclude one party’s liability in the event
of a breach
...
Otherwise it does not count
...


The 3 stages to test if the clause is valid are…

1
...
Does the exclusion clause cover the breach?
3
...
Signed
- If you sign a document which includes an exclusion clause, then you are
bound by the clause
...
The machine did not work but she sued
for damages and lost because they had her signature on the document
...
Unsigned
- Must show that a reasonable person would think it to be part of the
contract
...
On the back of the ticket that the customer got it had the exclusion
clause, the customer was injured by a faulty chair
...

















13

Contract Law – Defects of a contract

The 4 factors that can invalidate a contract are…

1
...
Mistake
3
...
Duress and undue influence

Mistake
- The general rule is Caveat Emptor ‘Buyer Beware’
- If you freely enter into a contract, then the courts will be reluctant to
interfere
...
Mistake to the quality of goods
- Bell v Lever Bros (1932) – LB had made Bell redundant, in his contract it
said that he would be paid a substantial amount of money if this was the
case, he was paid
...
Bell had done things
which allowed the company to fire him without pay
...
Bell kept his money
...


2
...
There were two shipping dates, one in
October and one in December, the defendant and claimant thought
different dates
...


3
...



The other 3 types are…

1
...

- Common mistake as to quality or ownership will not make the contract
void e
...
Lever Bros v Bell
...
Mutual mistake
- Both parties have made a mistake but they have each made a different
mistake
...
E
...
Raffles v
Wichelhaus
...
Unilateral mistake
- Only one party is mistaken, and the other party knows, or should know,
about the mistake
...

- Cundy v Lindsay (1878) – Rogue pretended to be a reputable company
and obtained handkerchiefs on credit from claimant and sold them to the
defendant
...


Misrepresentation

- During contractual negotiations, one party may make false statements
which encourage the other party to enter into the contract
...
Bisset v Wilkinson
(1927) – Claimant purchased a piece of land to farm sheep and asked the
defendant how many sheep it would hold, the defendant didn’t know and
estimated around 2000 sheep
...
The council held that the statement was only a
matter of opinion and not fact
...
Attwood v Small (1838) – Claimant wanted to buy some
properties and asked the defendant how much income they generated, he
got his accountants to check if the figure that he claimed was accurate,
they said that it was and he bought the properties
...

- If there is a change in circumstances, then this is a misrepresentation
...



There are 3 types of misrepresentation…

1
...

- Largely depends on the defendant’s state of mind i
...
did they intend to
mislead the claimant or was it an honest mistake
...
They were not allowed to so the claimant sued due to
misrepresentation
...


2
...




15

3
...




When making insurance contracts, anything that could affect the price of the
premium is a material fact, a person taking out an insurance must reveal all
material facts, whether asked to or not
...


Remedies for misrepresentation are…
- Rescission, where an equitable remedy to restore parties to pre
contractual position is put in place
...

- Right to rescind may be lost if contact is affirmed (e
...
too much time has
passed), impossible to restore to pre-contractual position (e
...
goods have
been destroyed), or third party has acquired rights (if third party
purchases then they have the rights)
...

- For negligent misrepresentation, claimant must prove that a
misrepresentation was made
...

- If the defendant succeeds it will be wholly innocent misrepresentation, if
he does not then it is just negligent
...

- Used to only include violence or threats of violence, which rarely came to
court
...
Atlas Express Ltd v Kafco Ltd
(1989) – Kafco had a contract with Atlas who would deliver their items,
Atlas wanted to charge a higher price and would not deliver the items
unless that price was met
...
Later they claimed
they were under economic duress and had to sign, judge ruled in their
favour
...

- In certain fiduciary (relationship involving trust) relationships, courts
assume that one party is dominant and can influence the other
...

- Undue influence renders a contract voidable
...


Contracts illegal at common law include…
- Contracts to commit crimes
- Contract promoting sexual immorality e
...
Pearce v Brooks (1866) –
Plaintiff sued prostitute for the price of a carriage well knowing what she
would do with it, he could not recover money
...


Contracts void by statute include…
- Many statutes include prohibitions on certain contracts
...

- The general rule is that the complete performance of the party’s
obligation under the contract are required for discharge to occur
...

- Cutter v Powell (1795) – Cutter had agreed to be a ships mate for the
entirety of a voyage, the journey took 2 months but Cutter died ¾ of the
way into it
...


The four exceptions to the general rule are…

1
...

- If the contract is divisible it will consist of a number of separate
obligations and part payment will be required for each obligation
performed
...
Held that it is divisible because the price was
said not the lump sum
...

- If partial performance nearly account for the whole performance, then it
will be paid for
...
The court of appeals held
that there had been substantial performance so the decorator was paid
£750 but had to pay damages of £56
...

- Sumpter v Hedges (1898) – Claimant had agreed to build 2 houses for
£565, he completed work to the vale of £333 and stopped because he ran
out of money
...
Held that hedges didn’t have to


18

pay agree to vary it or oy Sumpter for the work done, Hedges act of
completing the work did not indicate that he had freely accepted the
claimant’s partial performance
...

- The party prevented from performing will be paid the amount deserved
for the work completed
...

Colburn cancelled the series which had been partially written
...



Discharge by agreement

- Having made the contract, the parties are free to agree to vary or abandon
it
- However, agreement to do either must amount to another contract
...


A waiver is…
- A party may waive (give up) contractual rights by indicating to the other
party that the rights will not be insisted on
...

Oppenheim then said that if the car was not delivered by July he would
not accept delivery
...
The court of appeal held that O was entitled to refuse
delivery by giving reasonable notice of delivery before July
...


1
...

- Taylor v Caldwell (1863) – A music hall was hired out for four days
...

- If a party who has contracted to perform the contract personally dies or
becomes too ill to perform, the contract will be impossible to perform
...




19

-

Condor v The Barron Knights (1966) – A 16-year-old drummer joined a
banned and worked long hours
...
Doctors ordered he should not work more
than 4 nights in a row
...
It was held that the contract was frustrated and therefore the
contract terminated so no damages awarded
...
Illegality of performance
- Where a contract is illegal to perform it will become frustrated
...

Great Britain was at war with Germany and its illegal to supply an enemyoccupied territory
...
Contract becomes radically different
- A contract becomes frustrated if it becomes radically different from what
the parties intended when they entered into the contract
...
A
coronation process was to pass through London in June
...
King was ill so the coronation was cancelled
...
Was held that H did not have to pay because the contract became
frustrated
...

- David Contractors Ltd v Fareham UDC (1956) – The parties included a
force majeure clause to what would happen if there turned out to be a
shortage of labour and materials, the court enforced it
...

- A breach is when a term is not carried out
...


An anticipatory breach…
- The injured party can either accept the breach or keep the contract open
...

- If not accepted, the contract remains on foot
...

- If the contract is performed, there is no problem
...

- The Consumer Protection Regulations 2000 gives a cooling off period, 7
days to consumers who buy goods or services from a supplier by means
of a distance contract
...

- Distance communications include letters, newspaper adverts with order
forms, over telephone, etc
...

- Damages are intended to put the injured party in the same position, as far
as money can do so, as if the contract had been performed
...
e
...

- Claimant must prove that the defendant’s breach caused the loss
...

- The two rules that the Hadley v Baxendale created are…

1
...

2
...
(what does the other party know)
...

- Victoria Laundry v Newman Industries (1949) – Claimants agreed to buy
a boiler from the defendants for use in their laundry
...
Also claimed £262 per week which had been
lost from not being able to use the boiler to fulfil a very profitable contract
to dye military uniforms
...



The amount of damages depends on…
- If the los falls within one of the two rules in H v B, then the amount of
damages must be calculated
...




21

-

If not for the goods, damages are quantified on the basis that they are
intended to put the injured party in the same position, as far as money
can do this, as if the contract had been properly performed
...



Mitigation…
- A party who suffers a loss as a result of a breach of contract must take all
reasonable steps to mitigate (reduce) the loss
...

- Damages agreed are classified as liquidated damages or penalties
...
Liquidated damages
- If the amount fixed is what the party genuinely believed the loss would
be, this will be the amount awarded, no matter what the actual loss turns
out to be
...
Penalty
- An excessively large amount
...



Interest on damages…
- A contract might agree that interest on damages should be paid at a
certain rate
...


Suing for contract price…
- Suing for contract price is not the same as damages
...

- When a claim is made for the payment of debt, the amount claimed is
liquidated and the rule of remoteness of damages in H v B do not apply
...
g
...
J completed the
office but K does not pay, J can sue him for the contract price (£20,000)
which is now a debt owed
...

- Ig Jane agreed to sell antique dresser to Karen and then doesn’t deliver, K
can ask court for specific performance i
...
deliver the dresser and not pay
damages
...


An injunction is…
- A court order which requires a person to do or not to do a certain thing
...

- However, an injunction will not be awarded when damages would
provide a satisfactory remedy
...
v Nelson (1936) – Bette Davis, an actress made
an exclusive contract with the claimants and agreed not to act with
anyone else for 2 years
...
Defendants sought an injunction to prevent it
...


Rectification is…
- An equitable remedy which arises when a contract which has been
concluded orally is then written down
...


Quantum meruit…
- A party who receives a quantum meruit payment is paid the amount
deserved for the work completed
...

- If the other party voluntarily accepted partial performance
...

- If the work was done and accepted under a void contract
...

- A simple contract must be sued upon within 6 years of the right to sue
arising
...

- A claim for personal injuries must be made within 3 years of the right to
sue arising
...

- Time does not run against minors until they reach the age of 18
...

However, an equitable remedy will not be granted to a party who has
delayed unreasonably in asking for the remedy
...
Control test
- Does the employer have ‘control’ over how the work is
performed?

2
...


- Lee v Chung (1990) – Claimed compensation when injured
working
...
However, he was
expected to be on site when work was available, contractor
provided all equipment and told him where to work
...


- Stringfellow Restaurants Ltd v Quashie Ltd (2012) – Dancer
said she was unfairly dismissed due to drug allegations,
claimed for unfair dismissal
...
However, she could
choose when she worked, paid her own tax, and customers
paid her directly
...


The Employment Contract

- The employer must provide written particulars within 2
months
...
Breach of statutory duty
- This is a criminal offence

2
...

- Delegated wide powers to pass detailed regulations covering
hazards
...
’

It sets out 5 areas to which the duty extends…
- Safe plant and systems of work
- Safe use, handling, storage and transport of substances
- Providing information, instruction, training and supervision
- Maintaining any place in safe condition
- Providing and maintain an overall safe working environment

- Employers are also responsible to independent contractors and
visitors
...

- To cooperate with the employer
...

- To issue improvement notices
- To issue prohibition notices
- Other powers may be granted by delegated legislation










27

Common law health and safety

- Implied term in employment contract requires employer to
take reasonable care of employee
...


The claimant must prove…
- The employer owed them a duty of care
...

- That this breach resulted in foreseeable injury to the claimant
...
Bradford asked to postpone but
was denied
...



Termination of Employment

- A dismissal is when a fixed-term contract ends and is not
renewed
...
Wrongful dismissal
- If the contract is terminated without the appropriate notice
...

- Remedy is usually lost earnings payable during the notice
period
...

- Between 1 month and 2 years, minimum notice is 1 week
...


2
...
‘An employee has the right not to be
unfairly dismissed by his employer’
...


- The employer must then disprove unfairness
...
Redundancy
- If dismissal is because the employer ceases or intends to cease
carrying on the business, or carrying on the business at the
same place, or does not require so many employees to do work
of a certain kind
...


In order to claim, must prove…
- 2 years continuous employment
- Dismissal, either actively or constructively
- Must claim within 6 months


- If offered ‘suitable’ alternative employment, then redundancy
lost if refused
...
It was held that
she was not entitled to redundancy payment due to undue
sensitivity
...

- Employees weekly wage or £464 (whichever is smaller),
multiplied by half a weeks pay for each complete year aged 22
and under
...

- One and a half weeks pay for each complete year aged 41 or
more
...
Alidair v Taylor (1977) – Taylor was
dismissed after attempting to land an aircraft and it bouncing
10 feet in the air and damaging the plane
...

- Conduct
- Retirement
- Redundancy
- Statutory restriction
- Some other substantial reason


- Fairness is judged by deciding whether the employer acted
reasonably, was the dismissal within the band of reasonable
responses
...

- Code not legally binding, but will be considered by the tribunal
...

- Taking into account the expenses uncured and the injuries suffered
- For example, if someone was run over, the damages might include an
amount for the pain and suffering, lost wages, etc
...




NEGLIGENCE

-

The most common tort
Very broad to cover a wide variety of negligent conduct
...
Duty of care
- Legal obligation to ensure safety
...
Breach of duty of care
- Merely owing a duty of care is not enough to give rise to liability in tort
...

- There is an objective standard
- It is not defence that the defendant was doing his competent best
...
Damage was caused by the breach
- In order to recover damages in the tort of negligence, the claimant must
prove that the defendant’s breach of duty caused the loss or which
damages is being claimed
...

- Difficulties arise where the claimant’s loss was caused not only by the
defendant’s negligence, but by other causes too
...
The friend
bought some ice cream and a bottle of ginger beer for the claimant
...
When the
friend poured the rest of the mixture the remains of a decomposed snail fell out
of the bottle
...
Claimant could not sue
café because her friend made the purchase
...
The manufacturer denied
one was owed
...


- If this case had arisen in 2015, the Contracts Rights of Third Parties Act
1999 would have allowed the claimant to sue the café
...

- These statutory rights do not detract from the legal principles established
in the case
...
It must have been foreseeable that harm would be caused by the
defendant
...

- However, the extent of the loss does not need to be foreseeable, nor does
the precise way in which it arose
...
There must have been ‘proximity’ between the claimant and the
defendant
...

- If a second pedestrian, who was not physically injured, suffered nervous
shock as a consequence of seeing the accident, the necessary proximity
may not be present
...
g
...


3
...


Failure to act

- The general principle of English law that a person is not to be made liable
for mere failure to act
- This is even when apparent failure to act will result in another person
suffering injury
- It may be wrong morally, but it is not negligent



33

Omissions

- If the defendant has undertaken to do something, which he later fails to
do
...


The impact of the ‘Neighbour’ Principle

- Road users owe a duty of care to other road users and pedestrians
...

- Professional advisors owe a duty of care to their client
...

- The importance and legal reasoning in Donoghue v Stevenson (1932) is
important because it allows the tort of negligence to be interpreted
broadly to cover new situations
...

- This is known as the ‘incremental approach’
...

- A claim for not being able to use the goods until they could be repaired or
replaced e
...
an amount for loss of profit
...

- Damages cannot be claimed for a loss which could have been mitigated by
taking reasonable steps
...













34

Defences to negligence

1
...

- Involves the claimant contributing to his own injuries/loss
...
Volenti non fit injura (to one who volunteers, no harm is done)
- It is a complete defence to show that the injured person voluntarily
assumed the risk which caused the injury



APPLYING THE LAW

-

Need to decide whether it’s a claim of negligence or if its under the
Consumer Protection Act 1987
...


The claimant will need to prove…

1
...
Damage suffered as a result
- Can claim for death/personal injuries, damage to land, goods (0ver £275),
but cannot claim cost of the defective item
...
No need to prove defendant was careless
- Strict liability applies









35

Strict liability v Fault liability

Strict Liability – Only need to prove a casual link between the defendant’s
behaviour and the damage suffered
...


- In tort of negligence, liability is based on fault, the defendant’s behaviour
does not meet an objective standard
...

- Claimant under CPA only has to prove product was defective and they
suffered some hard, no need to prove how/why it was
...


Abouzaid v Mothercare (2001) – The claimant (age 12) was blinded by the
defendant’s product when a metal buckle at the end of the plastic strap wounded
her eye
...
Mother care was held liable even though the damage
could not have been reasonably foreseen
...
Bottle was held to
not be defective because a reasonable person would expect it to be harder to
open than a regular bottle, which it was, even though it did not meet British
standards for safety caps
...
Liability depended on a contractual or
fiduciary (involving trust) relationship between parties
...

- Candler v Crane, Christmas & Co (1951) – Defendant was firm of
accountants who negligently prepared accounts, knowing they would be
used to persuade claimant to invest £2000 in the company which he lost
when company wound up
...
(This case is no longer on
good authority)
...
HB granter credit and later lost the money, so
claimed against bank for negligent misstatement
...



For an action in negligent misstatement to succeed, there must be a special
relationship between the claimant and the defendant, they must show…
- That the claimant relied on the defendant’s skill and judgement
- That the defendant knew, or reasonably should have known, that the
claimant was relying on him
- That it was reasonable in the circumstances for the the claimant to rely on
the defendant

- A special relationship must exist where a professional person advises a
known person who relies on the statement for a known purpose
...


- It is clear that liability will only arise where the defendant is in the
business of giving professional advice and the statement is given in the
context i
...
not on a social or informal occasion
...


- If advice is given or financial statement prepared for a specific purpose,
then a duty of care is owed to those who are relying on them for that
specific purpose
...
Defendant
auditors reported that the company had made a £1
...
Claimant relied on report to
launch takeover bid and later found out the true state of the company’s
finances
...
There was no special relationship between
auditor and individual member, the statement was to provide
shareholders with information, not foreseeable it would be used as the
basis of a takeover bid
...


- Auditors opinion is the published outcome of an auditor’s review of a
company’s financial statements
...


- The opinion states the auditor’s conclusion that the financial statements
do or do not fairly represent the financial position and performance of the
organisation, and that they do or do not conform to Generally Accepted
Accounting Principles (GAAP)
...
RBS claimed they had relied on these accounts and that they
had been negligently prepared
...
Held that BJM were liable, it was not needed to prove that the
auditor intended RBS to rely on report for a duty of care to exist
...
The auditor
has knowledge of the user and the use
...

- Negligent misstatement is a form of the tort of negligence
...





38

It is not used as often as negligent misrepresentation under the
Misrepresentation Act 1967 because…
- Its easier to prove negligent misrepresentation under the act
...


With negligent misstatement, the person who relied on the statement must
prove…
- That the maker of the statement owed them a DoC
...

- That the breach caused them damages
...

- Aim is to protect the goodwill of a business

Can be committed by…
- Marketing goods under the claimant’s trade name
- Illicitly using the claimant’s trade mark or a version of it
- Imitating the appearance of presentation of the claimant’s goods
...
g
...


- Remedies include an injunction to stop the passing off, damages or an
account of profits
...

A new company set up a competing business on the same street with the
same name
...


- United Biscuits v ASDA (1997) – ASDA marketed a business similar to the
penguin product packaging, selling it for 25% less
...
Held
that the claim for registered trade mark infringement had failed, however
an injunction to stop passing off succeeded

---