2 The Law of Torts © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

CH 2 LEARNING GOALS Identification of common torts (intentional and unintentional) Identification of tort situations in business Understand principles of law imposed by the courts to determine tort liability Understand how the courts apportion liability where more than one person is responsible Understand how damages or compensation is determined by a court Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-1 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

2.1 Tort Law Tort: acts or omissions recognized by law as civil wrongs causing injury to others or their property Actions may have: tort aspect = civil action by plaintiff against a defendant based on compensation Criminal aspect = criminal charges by the Crown against an accused based on punishment Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-2 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

2.1 Tort Law Unintentional Torts – commit the acts without intent, usually by accident or carelessness Negligence Occupiers’ Liability Vicarious Liability Strict Liability Commercial Negligence Intentional Torts – decision to commit the acts, not always intention to harm Assault & Battery False Imprisonment Defamation Trespass Nuisance Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-3 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

2.1 Tort Law Torts: legal rules with individual definitions as set out in common law and based on precedence What torts can you identify? Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-4 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

2.3 Assault and Battery These are separate torts that usually occur together Assault – threat of injury to a person, with the intent to carry out the force Battery – intentional and deliberate force or touching to a person without consent Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-5 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Assault and Battery (Cont’d) 2.3 Assault and Battery (Cont’d) Defences to Battery: Self-defense – reasonable force can be used to stop the threat and protect a person or property, but the force cannot be excessive Consent – if physical force is known and agreed to then only if excessive would battery occur, and in medical the consent must be for a particular procedure What examples of assault and battery can you identify (include medical procedures)? Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-6 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

False Imprisonment Comprised of two aspects: 2.4 False Imprisonment Comprised of two aspects: Imprisonment – restraint or confinement, including remaining based on embarrassment of public accusation False – no lawful right to restrain – for example no theft committed Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-7 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

False Imprisonment (Cont’d) 2.4 False Imprisonment (Cont’d) Defences: Limited as requires lawful reason to restrain, usually crime committed Best method is call the police, as they may apprehend on ground the plaintiff may have committed a crime Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-8 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Defamation Defamation: False statement 2.5 Defamation Defamation: False statement Publication – made to other party or parties Slander – verbal Libel – written form Loss reputation by person, business or service What forms of communication can be defamatory? Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-9 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Figure 2-1 Defamation Essentials of Canadian Business Law, 1st Canadian Edition Slide 1-10 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Defamation (Cont’d) Defences Truth: must be proven in fact 2.5 Defamation (Cont’d) Defences Truth: must be proven in fact Absolute privilege: situations of public interest (courts, boards, Parliament) Qualified privilege: made in good faith with importance to public (letter of reference) Fair Comment: raised by the media based on honest opinion with public information Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-11 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Trespass to Land and Goods 2.6 Trespass to Land and Goods Entry on land without permission or consent May have damage, but even intrusion gives rise to the tort Remedies include damages or injunction (court order to prevent to action/trespass) Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-12 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Nuisance – Private and Statutory 2.7 Nuisance – Private and Statutory Private Undue interference with enjoyment of property Serious interference not mere inconvenience Courts will examine Interests of community over individual interests Reasonable use Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-13 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Nuisance (Cont’d) Private Nuisance 2.7 Nuisance (Cont’d) Private Nuisance Remedies: damages and injunction (court order to refrain from certain acts) Statutory Nuisance Areas where governments have regulated certain activities for the benefit of the community as a whole What areas can you identify for government regulation? Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-14 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Negligence Most common tort Negligence - summary 2.8 Negligence Most common tort Negligence - summary Duty – owed to another not to cause harm Breach – duty is not met Damages – injury caused by breach Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-15 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Negligence Duty Standard of care owed not to injure another 2.8 Negligence Duty Standard of care owed not to injure another “Reasonable person” test Careful and cautious in his or her conduct Determined by courts in each situation and varies with Activity or action Risk Skill or expertise Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-16 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Negligence – Breach of Duty 2.8 Negligence – Breach of Duty After plaintiff proves duty owed then must prove: Breach of duty – defendant did not meet the standard of care for the situation To whom do you owe a duty of care when you drive? What is the standard you owe? What situations would be a breach of this duty? Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-17 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Negligence – Damages Causation 2.8 Negligence – Damages Causation Proximate cause: plaintiff’s negligence is the direct and only cause of the injury, if not plaintiff’s liability will be limited Remoteness or Foreseeability Test: reasonable person would have foreseen the damage or injury occurring from the action taken Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-18 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Negligence (Cont’d) Contributory Negligence 2.8 Negligence (Cont’d) Contributory Negligence Plaintiff is also responsible (partly or entirely) for his or her injuries Court will apportion the damages based on the extent of responsibility Voluntary Assumption of Risk Person voluntarily participates in an activity which carries a chance of risk Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-19 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Other Unintentional Torts – Occupiers’ Liability 2.9 Other Unintentional Torts – Occupiers’ Liability Duty of care owed by an occupier, person in possession of land, to others on the land Common Law: Trespasser (no permission) – no duty of care, but cannot deliberately injure Licensee (permission for licensee’s benefit) – duty to warn of hidden dangers Invitee (permission for occupier’s benefit) – highest duty to warn of unusual dangers that exist that a reasonable and careful person should know; duty met if sufficient warnings are given Statute Law: Many provinces have legislation imposing a standard of care owed to trespassers and visitors Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-20 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Figure 2-2 Defamation Essentials of Canadian Business Law, 1st Canadian Edition Slide 1-21 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Other Unintentional Torts – Vicarious Liability 2.9 Other Unintentional Torts – Vicarious Liability Liability for the actions of another Employment: Employer is liable for torts committed by an employee while carrying out duties assigned, as the employer exercises control and supervision over the employee Partnership: Partnership is liable for torts committed by the partner if the actions are in the course of partnership business Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-22 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Other Unintentional Torts – Strict Liability 2.9 Other Unintentional Torts – Strict Liability Activities are so dangerous that they result in liability regardless of care taken or duty of care met Governments by laws use strict liability for environmental damage Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-23 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Commercial Negligence 2.10 Commercial Negligence Professional Negligence Duty owed is that of a reasonable person who is a fully qualified member of that profession with standards established by a governing body or association Very high standards of care Protection by insurance Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-24 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Commercial Negligence (Cont’d) 2.10 Commercial Negligence (Cont’d) Negligent Statements Reports or advice by professionals must meet the standard set by the profession Liability to others who rely on the statements and suffer a loss S.C.C. test @ page 47 Liable to foreseeable users of information Determination of appropriate limitation on group using the information, therefore not liable to the world at large What professions are impacted by this tort? Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-25 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Commercial Negligence (Cont’d 2.10 Commercial Negligence (Cont’d Manufacturers’ Negligence High duty of care is owed to the consumer that they will not be injured by the product Donoghue v. Stevenson “snail in the bottle” case is the leading case establishing liability to the consumer Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-26 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Commercial Negligence (Cont’d) 2.10 Commercial Negligence (Cont’d) Manufacturers’ Negligence Standard of care is required to ensure products will not damage or injure the user or consumer Adequate testing is essential to avoid liability If a product is dangerous then adequate warnings and proper instructions are also essential to avoid liability Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-27 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Defences to Claims of Negligence 2.11 Defences to Claims of Negligence Act of God No liability for loss caused by an unanticipated event beyond the control of plaintiff Waiver Express or implied promise not to sue Usually in writing Must be brought to the attention of person waiving the right Must refer to the type of injury contemplated at the time Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-28 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Defences to Claims of Negligence (Cont’d) 2.11 Defences to Claims of Negligence (Cont’d) Release Promise to discharge a person from liability and not to sue Usually written release for compensation for loss or damage suffered Statute of Limitations Legal action must begin within a reasonable time, most provinces have statutory limits If action is not commenced within the set time period the right to sue is lost Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-29 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Defences to Negligence 2.11 Defences to Negligence Lawful Right Person is granted the right to action under a duty to protect the public at large, then will not be liable When would these defences apply? Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-30 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Tort Remedies 1. Special Damages 2. General Damages 2.12 Tort Remedies Monetary (money) Damages to place person back in same position 1. Special Damages Established by specific receipts or records 2. General Damages Estimated usually based on expert testimony 3. Punitive or Exemplary Damages Punishment for particularly reckless actions, usually intentional torts not ordinary negligence 4. Nominal Damages Small amount of money to recognize violation, but court costs may also be given adding to the cost Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-31 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Special Remedies Special Remedies 2.13 Special Remedies Special Remedies Injunction – court order requiring stoppage of certain action Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-32 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

Business-Related Torts 2.14 Business-Related Torts Slander of Goods Untrue statement as to the nature of goods Slander of Title Untrue statement with respect to ownership of goods Fraudulent Misrepresentation Intentional false statement to deceive another into entering a contract Allows rescission of the contract and damages Fraudulent Conversion of goods False pretenses to acquire goods Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-33 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.

SUMMARY Torts are civil wrongs causing injury to another CH 2 SUMMARY Torts are civil wrongs causing injury to another Intentional – often criminal association Assault and battery, false imprisonment, defamation, trespass, nuisance Unintentional – negligence, most common type of tort, with many aspects Liability by professionals, manufacturers, occupiers, vicarious and strict liability Defences are available for tort actions Remedies are used to compensate for losses caused by tort actions Essentials of Canadian Business Law, 1st Canadian Edition Slide 2-34 © 2005 McGraw-Hill Ryerson Ltd., All Rights Reserved.