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LAW 122 (618)
Chapter 5


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Law and Business
LAW 122
Theresa Miedema

CHAPTER 5 MISCELLANEOUS TORTS AFFECTING BUSINESS LAW 122 Other Important Torts in business Context:  Conspiracy  Intimidation  Interference with contractual relationships  Unlawful interference with economic relations  Deceit  Occupiers liability  Nuisance  The rule in Ryland’s v Fletcher  Defamation  Injurious falsehood Many of these Torts require proof of the defendants Intentions Uses a different meaning for intention- defendant intentionally meant to hurt the plaintiff or knew that such an injury was reasonably foreseeable CONSPIRACY  Tort of Conspiracy- usually occurs when two or more defendants agree to act together with the primary purpose of causing financial loss to the plaintiff.  Law condones aggressive competition between individuals, but its sense of fair play may be offended if several people conspire against another.  Hard to prove in courts  Cant distinguish if defendants primary purpose of hurting the plaintiff  Tort of conspiracy raises issues legally and ethically  Rules are different if the defendant injured the plaintiff by conspiring to perform an unlawful act. INTIMIDATION  Concerned with unethical business practices  Intimidation: occurs when the plaintiff suffers a loss as results of the defendant’s threat to commit an unlawful act against either the plaintiff or a third party.  Tort of intimidation has two branches (pg 103) o Two-Party intimidation: occurs when the defendant directly coerces the plaintiff into suffering a loss  Ex. Manger of a supermarket might use threats of physical violence to frighten the owner of a small convenience store into closing down. Three party intimidations: occurs when the defendant coerces a third party into acting in a way that hurts the plaintiff. Ex) airplane union hires 3rd parties to get rid of union member, if you want to sue in tort you have to go against the union(defendant) not against the third party in this airplane case It will never be an illegal act for an exam 3 Elements (rules) of Intimidation  First Plaintiff must prove that the defendant threatened to commit an unlawful act, such as a crime, or tort, or even a breach of contract  Second, the tort does not occur unless the threatened party gave in to the intimidation  Third, as long as the other elements of the tort are established, there is no need to prove that the defendant intended to hurt the plaintiff. Intimidation may occur even if the tortfeasor was motivated by a desire to benefit itself, rather than injure plaintiff INTERFERENCE WITH CONTRACTUAL RELATIONS  Most effective ways of gaining an advantage over competitors in the business world is to hire away its best workers or otherwise prevent those people from performing their jobs.  Interference with contractual relations: occurs when the defendant disrupts a contract that exists between plaintiff and third party. (pg 104) o Direct inducement to breach of contract o Indirect inducement to breach of contract  Direct inducement to breach of contract o Occurs when the defendant directly persuades a third party to break its contract with the plaintiff. o Liability requires four factors  first the defendant must know about the contract between the third party and plaintiff (does not have to know all the details)  Second, the defendant must intend to cause the third party to break that contract, the defendant does not have to intend to hurt the plaintiff. (tort can be committed even if the defendant is motivated by a desire to benefit itself)  third, the defendant must actually cause the third party to break its contract with the plaintiff  fourth, the plaintiff must suffer a loss as a result of the defendants conduct, most times satisfied with the fact the third party does not perform its contract with the plaintiff • that in addition to suing the defendant in tort for breaching contract, the plaintiff can sue the third party in contract for the actual breach, but the plaintiff cannot recover full damages under both actions Indirect inducement to breach of contract • Occurs when the defendant indirectly persuades(an illegal act) a third party to break its contract with the plaintiff • Does not occur when if the defendant (union) calls a legal strike that causes the third party (company)to breach its contract with the plaintiff (customer) • Ex) party is a carpenter, defendant steals tool of worker, not allowing him to finish work and contract UNLAWFUL INTERFERENCE WITH ECONOMIC RELATIONS  May occur if the defendant commits an unlawful act for the purpose of causing the plaintiff to suffer an economic loss. (pg 106 case 5.2)  Following torts are defined as business torts-deal with situations in which one business may try to gain advantage over another Name of tort Unlawfulness Intent to harm Conspiracy Defendants act may Lawful act-hurting the plaintiff must be be lawful or unlawful defendants primary purpose Unlawful act-hurting plaintiff foreseeable Intimidation Defendant must Defendants act must be directed at plaintiff-but threaten unlawful act hurting plaintiff need not be defendants primary purpose Interference Indirect inducement- Defendants act must be directed at plaintiff-but with to breach of contract- hurting plaintiff need not be defendants contractual defendants act must primary purpose relations be unlawful Interference Defendants act must Defendants act must be directed at plaintiff-but with economic be unlawful or hurting plaintiff need not be defendants relations unauthorized primary purpose DECEIT  Occurs if the defendant makes a false statement, which it knows to be untrue, with which it intends to mislead the plaintiff, and which causes the plaintiff to suffer a loss. ( four parts to the definition)  1. defendant must make a false statement • defendant may know half the truth • defendant liable for failing to update information  2. the defendant must know, at the time of making a statement , that it is false  3. the defendant must make the statement with the intention of misleading the plaintiff.—does not have to be made directly to the plaintiff  4. the plaintiff must suffer a loss as a result of reasonably relying upon the defendants statement Defendant statement normally has to refer to a past or present fact • not held liable if defendant offered an opinion, predicted the future or made a boastful claim this is called a “PUFF” reasonable ppl do not rely on these statements • Ocassionally if a statement of fact is implied by an opinion, a prediction or a PUFF, a court might find that statement includes existing fact Caveat emptor “let the buyer beware” The seller is not obligated to volunteer information OCCUPIERS’ LIABILITY (use hand out quick guide to liability) -Occupiers liability: requires an occupier of premises to protect visitors from harm.  Occupier: any person who has substantial control over a premises, worry about control not ownership  Visitor: any person who enters onto premises  Premises: include more than land, ships, planes, vehicles,  Law of occupier’s liability is complicated, partly because it differs between jurisdictions. o Common law Rules ( made by judges) o Statutory rules (made by legislators) COMMON LAW RULES Traditional common law rules recognized four categories of visitors. Each visitor owed a different type of obligation Problems with traditional system of occupiers liability 1) Can lump together different types of ppl, ex) child walk on construction site and a person breaks into an office, both are trespassers considered unfair 2) Difficult to distinguish between the different categories, especially true for licensees and invitees 3) Visitors status may change, ex a customer who refuses to leave becomes a trespasser 4) Is often difficult to decide whether a danger is hidden or unusual, ex) an icy parking lot in Canadian winter Traditional rules for occupier’s liability Type of visitor Description of visitor Occupier’s obligation Trespasser A person who does not have not to intentionally or permission to enter the recklessly injure a premises trespasser Licensee A person who has To protect a licensee from
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