Comlaw 101 revision notes.docx

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University of Auckland
Commercial Law
Alex Sims

Overview of obligations  Obligation = a responsibility to act in a certain way to another person  Plaintiff must show harm is done to him. Proof of harm is not enough.  Single event can cause multiple obligations but the remedy can be claimed once. “no double dipping at compensation”. Statutory Liability  Some statues expressly create a right to sue for damages and other remedies e.g. Consumers Guarantees Act 1993 – creates remedies for consumers who receive defective goods or substandard services Fair Trading Act 1993: Prohibits certain conduct by persons who are in trade. Covers misleading and deceptive conduct, false representations and other unfair trade practices.  Creates civil and criminal liabilities  Section 9 of the Fair Trading Act: (civil liability only)  “No person shall, in trade, engage in conduct that is misleading or deceptive or is likely to mislead or deceive”.  2 requirements: defendant must be in trade: defendant must be acting in a business context  defendant must have been misleading or deceptive: 3 steps drawn from AMP Finance NZ Ltd V Heaven J; conduct capable of misleading, plaintiff mislead by the conduct, reasonable that the plaintiff was mislead.  Puff: Statement made about a product, will be caught if a representation of a fact is false Criminal liability: must prove every requirement  2 elements: actus reus – physical act; mens rea – accused’s state of mind  3 types of criminal liability. Public welfare matters and public regulatory offences are strict or absolute. Mens rea offences: prosecution has to establish the accused had the necessary mens rea. Millar v Ministry of Transport Millar was driving while he was disqualified. He believed his disqualification had ended but it wasn’t so. The Court said if Millar could prove that what he believed was true then he would not be charged. Strict liability: accused can avoid liability if they can prove she was not at fault Civil Aviation Dept v MacKenzie `Defendant unknowingly caught telephone wires while flying on low altitude. The wires were dragged close to people who were fishing. Defendant was charged for flying an airplane in a way which could have caused harm to people. Absolute liability: no defence available even if he was not at fault so liable regardless. Protecting Privacy Privacy Act 1993: governs the collection, use and disclosure of personal information. 12 Main principles to remember: 1. Organisation collects information that is relevant to its legitimate purposes 2. Person information collected from the subject directly 3. Subjects are told what the information is used for, collected and seen by whom and who it is shared with 4. Personal information must not be collected in an unfair manner 5. Personal information must be kept securely 6. Subjects are allowed to access their information 7. Subjects can correct their information 8. Personal information must be up to date and accurate before using 9. Personal information must not be kept longer than necessary 10. Personal information only to be used for the purpose it was collected for 11. Personal information can’t be disclosed unless otherwise stated 12. Organisation can’t assign the same unique identifier that another organisation has assigned to the subject  Can’t go to Court for breaching the Privacy Act  Complaints procedure – go to a Privacy Commissioner (free)  Remedies : injunctions/damages (damages = must be harm)  Exceptions to the Privacy Act: the media, law enforcements or statistical or research purposes where individuals can’t be identified  Public registers – can’t combine personal information from a public register and sell it.  Section 67 – anyone can complain to the Privacy Commissioner  Denial of principal 6: prejudice against NZ’s security, defence or international relations, likely that foreign govts would not trust NZ govt with confidential information, endangers an individual, Unsolicited Electronic Messages Act 2007  in force as at 5 September 2007  aka electronic junk mail, spam  Act covers emails, instant messaging, mobile phone messaging NOT FAX OR VOICE MESSAGING  Even one UCEM = breach of Act  Breach = civil liability  Enforced by Department of Internal Affairs – breaching = formal warning, infringement notice issued, Court action taken i.e. damages, injunctions Section 3: purpose of the Act a) Prohibit unsolicited electronic messages from NZ being sent, in order to: (i) promote a safe and more secure environment for the use of information and communications technologies in NZ; and (ii) reduce the barriers to the uptake and effective use of information and communications technologies by businesses and the wider community in NZ; and (iii)reduce costs for businesses and community that arises from UEM; and b) Commercial electronic messages need a unsubscribe button and the senders details c) prohibit address-harvesting software/lists from being used d) discourage people from using information and communications technologies inappropriately  S9 – prohibit of sending UCEM  UCEM checklist  Is the message electronic?  Is the message commercial?  Is the message unsolicited? Consent needs to be given otherwise it is an unsolicited message. Consent = express or inferred Express = direct signal from recipient that they give consent e.g. fill a paper form or tick a box on a website Inferred = consent that arises from a conduct and the business and other relationships of the sender and the recipient e.g. you provided your email address, general expectation that there is a follow up electronic communication Protecting Secrets  3 judge made laws to protect person and business secrets  Breach of term of contract  Tort of invasion of privacy  Equitable action for breach of confidence- Takes someone else’s information and using them inappropriately Came about due to the Prince Albert V Strange case. Queen Victoria and Prince Albert made some etchings and sent the etching plates to Strange to print some copies for family members. Strange held a public exhibition of the etchings and gave X a copy to prepare a catalogue for the unauthorised etchings. There was a “breach of trust, confidence or contract” which arise from this case. Elements to prove there was an equitable action for breach of confidence: 1) Information must have a quality of confidence i.e. no one knows it 2) Information must have been communicated in circumstances importing a obligation of confidence i.e. if you know it is confidential and disclose/use/take it in any way it is enough 3) Unauthorised use of the information to the detriment of the party communicating it i.e. it harms the other party in some way Elements came from 2 cases: Saltman Engineering Co Ltd v Campell Engineering Ltd: Coco v An Clark Engineering Ltd Mental element Defendant doesn’t have to intend to breach confidence? No. Seager v Copydex: Plaintiff came up with a carpet grip idea. Went to defendant to ask if they can manufacture it. Defendant says no. Few months later, defendant starting manufacturing carpet grips and sold it. Copydex liable. Trade Secrets: Crimes Amendment Act 2003 creates a new offense to the taking, obtaining or coping off trade secrets. Franklin V Giddens Franklin grew special types of nectarines which could be sold for high profits. Franklin is said to have a monopoly over these nectarines. Giddens sneaked into Franklin’s orchard one night to steal some cuttings from the nectarine trees. Giddens was charged for a breach of confidence. Why? The genetic code of the cuttings had necessary quality of confidence. Also because Giddens sneaked into the orchard, he knew the information was private.  Unintentional, accidental eavesdropping: when you realise information you overhead is confidential, you are bound by confidentiality  Information can only be protected if it is not common knowledge or already known. Contractual obligations of confidence A contractual obligation of confidence is only enforceable against the other party to the contract. If A and B have a contract which contains a confidentiality clause (express or implied), but B gives confidential information to C, A can use contractual breach of confidence against B, but will have to use equitable action for breach of confidence against C. Employment contracts 2 types – one when you are employed and one when you leave the industry Current employees’ obligation Coco v Clark  Equitable obligation of confidence – e.g. customers names, their purchases, secret formulas, business plans  Fiduciary duties – act in the best interests of the employer; not to make a unauthorised profit from employee’s position  Implied contractual term to serve the employers faithfully and not disclose confidential information obtained in the course of,, or about, employment  Don’t give info out to other people when you are employed Post employment If information is part of “general skill, expertise or knowledge’ of an employee she can’t be prevented from using it (Faccena chicken), unless there is a valid restraint of trade clause. If information is a trade secret, the information “belongs” to the employer and can be protected by a breach of confidence action. Test for trade secret:  Who had access
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