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LAW 122 (625)
Chapter 3

Chapter 3 Notes

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Law and Business
LAW 122
Kernaghan Webb

Chapter 3: Introduction to Torts INTRODUCTION TO TORT L AW o Tort: generally consists of a failure to fulfill a private obligation that was imposed by law. Torts and Crimes o Tortfeasor: a person who commits a tort. Thus you are entitled to sue me, If you win the lawsuit, the court will hold me liable & probably order me to pay damages to you. A tort occurs when a person breaks a private obligation, whereas a crime occurs if a person breaks a public obligation. A public obligation is owed to society as a whole, thus if something goeswrong, the gov’t will prosecute the accused on behalf of the whole community. If the court agrees with the gov’t then the accused will be found guilty and subject to punishment. In many cases, torts & crimes will overlap. E.g. If I sneak into your house, I commit the tort of trespass to land & the crime of break & enter. Concept Summary 3.1 Torts and Contracts Just as torts may be confused with crimes, it may also be confused with contracts. We will outline one similarity and four differences. Structure: Both tort & contract involve primary and secondary obligations. a) Primary obligations tell ppl how they ought to act. E.g. Tort of Battery - Don’t touch another person in an offensive way. Law of Contract – Keep your promise. b) Secondary obligations are remedial – tells ppl how they must act after primary obligations have been broken. – Both tort & contract: Pay money for harm that has been caused. Source of Primary Obligations: Tort: Obligations of tort are simply imposed by law Contract: Obligations are created by the parties involved. Privity: Tort: Since obligations are imposed by law, I can sue you even if you don’t agree to anything. Contract: Privity states that the only ppl who can sue, or be sued, on a contract are the parties themselves. Compensations: Compensations are available in both torts and contracts. Tort: Obligations are imposed to prevent harm. For e.g. if you break primary obligations, & my injuries cost $5000 in medical bills, I can recover this amount form you. Contract: Obligations usually provides a benefit. For e.g. If you agreed to buy my car for$10,000, but you failed to do so, you still have to pay me for whatever the car is really worth $13, 000. 1 of 4 www.notesolution.com Chapter 3: Introduction to Torts Types of Torts 1) Intentional Torts occurs when a person intentionally acts in a certain way to harm another. 2) Negligence Torts occurs when a person acts carelessly. 3) Strict Liability Torts occurs when a person does something wrong without intending to do so & without acting carelessly. E.g. If your dog trespasses on someone else property, you are held liable. Concept Summary 3-3 G ENERAL P RINCIPLE OF T ORT L AW Liability Insurance o Liability Insurance: is a contract in which an insurance company agrees, in exchange for a price, to pay damages on behalf of a person who incurs liability. Liability insurance also includes a duty to defend which requires the insurance company to par the expenses that are associated with lawsuits brought against the insured party. Liability insurance creates an interesting tension b/t 2 of tort law’s most important function. i. Compensatory Function aims to fully compensate ppl who are wrongfully injured. (You pay fully, or if you have an insurance company they pay. E.g. Car accident). ii. Deterrence Function discourages ppl from committing torts by threatening to hold them liable for the losses they caused. However, ppl have little reason to be afraid, if they know that their insurance company will pay if something goes wrong, thus tort law has little deterrent effect. Vicarious Liability Liability insurance is always a good idea, especially for bus. that have employees. That additional need for insurances arises from the doctrine of vicarious liability. o Vicarious Liability: occurs when an ER is held liable for tort that was committed by an EE. The idea of hold one person liable for another person’s actions raises difficult ethical issues. The doctrine of vicarious liability may be justified on a number of grounds: It serves the compensatory function of tort law b/c it allows the plaintiff to claim damages from both an EE and n ER. May serves as deterrence function of tort law, by providing ER with an incentive to avoid unusually hazardous activities & to hire
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