Prepared by Douglas Peterson, University of Alberta 6-1 Part 2 – The Law of Torts Chapter 6 Special Tort Liabilities of Business Professionals

© 2006 McGraw-Hill Ryerson Limited 6-2 Overview  Professionals  Who is one?  Professional standards and associations  Professional client relationship  How it arises  Fiduciary Duty of Care  Tort Duty of Care  Various professionals

© 2006 McGraw-Hill Ryerson Limited 6-3 The Professional  Professional  a person with special skills not possessed by most individuals  These special skills distinguish professional from others  Usually has an accompanying professional body (self- regulating body)  A system of accreditation, educational and training

© 2006 McGraw-Hill Ryerson Limited 6-4 Standards  Purpose  Protection of the public by ensuring professionals are licensed and qualified  Professional associations ensure the above  Right to revoke or prevent a member from practicing  Establish standards of competence

© 2006 McGraw-Hill Ryerson Limited 6-5 Professional-Client Relationship  Created:  By contract  Contractual duty of professional to perform services  Negligent performance is a breach of contract  Implied  By providing services

© 2006 McGraw-Hill Ryerson Limited 6-6 Duty  Fiduciary Duty  Duty to place a client’s interests above the professional’s own interests  Distinguishes a professional from others  Avoid conflicts of interest  Tort Duty of Care  professionals must perform their duty according to the accepted industry standards  Determined by the self regulating body

© 2006 McGraw-Hill Ryerson Limited 6-7 Standard of Care  Standard  Professional must perform their duties according to the standard of skill, knowledge, and judgment of the reasonable, average doctor  Industry standards established by expert opinion (i.e. peers)  “As at” the time of the alleged negligence

© 2006 McGraw-Hill Ryerson Limited 6-8 Specific Standard of Care  Specific Situations  Specialist vs. generalist  Locations – rural vs. city  Situation – emergency room vs. roadside accident  Error vs. Negligence  Standard does not require perfection  Not all errors are negligence

© 2006 McGraw-Hill Ryerson Limited 6-9 Informed Consent  Definition  Full and understandable explanation of risks associated with a course of action, and the clear understanding by the client or patient  If not done a cause of action  If done – a defense  Moral obligation (the right thing to do)

© 2006 McGraw-Hill Ryerson Limited 6-10 Who is owed a Duty?  Question of law  Two Determinations  Relationship  Client/patient  No duty generally owed to a third party  Reliance  On the professional by the person

© 2006 McGraw-Hill Ryerson Limited 6-11 Negligent Misrepresentation  Negligent misstatements  May constitute a breach of the standard of care  Scope of liability extends to those whom the professional knew would rely on such statements and was intended to be relied upon

© 2006 McGraw-Hill Ryerson Limited 6-12 Negligent Misstatements  Threefold Test(determines liability) 1. Whether the harm was foreseeable 2. Whether there was a relationship between the parties of sufficient proximity 3. Terms of public policy it would be just and reasonable to impose the duty on the party making the statement

© 2006 McGraw-Hill Ryerson Limited 6-13 Professionals  Liability  General rules of professional liability apply regardless of the profession  Certain statutes may impose extra duties for certain professions (i.e. accountants)  Some differences exist for certain professions (i.e. solicitor client privilege for lawyers  Engineers more specialized and restrict their practices to areas of expertise  Architects – liable for design flaws not construction flaws

© 2006 McGraw-Hill Ryerson Limited 6-14 Summary  Professional  One who possesses specialized knowledge or skill  Usually regulated by self governing body who determines negligence  Professional liability may arise under contract but usually under the tort of negligence or a breach of fiduciary duty