This is a solution of Contract and Negligence Assignment part 3 in which we discuss a valid contract as if even one element is missing then the contract is not enforceable in law.
Whether Schneur can recover his losses from Patricia from providing wrong advice?
In Tort law, there are two important laws that prevail in United Kingdom. The same are law of contract and the law of negligence. Both the laws are of civil nature but are very distinct. In the law of contract the parties are in contractual relationship which is not in tort law. Also, the liability in contract is strict and pre-determined whereas in tort the same is fault based and is not pre-determined by the parties. Thus, though both the laws are very important but are distinct.In tort law, one of the areas of law that is very important is the law of negligence by professionals by furnishing advice. Normally, a person is considered to be negligent when he does not cater his duty of care which is imposed upon him by law and because of such violation of duty of care loss is caused to any party who is in proximate relationship with him, that is, who is considered to be his neighbour. Thus, in order to bring claim of negligent advice by professional, the main essential to prove are:
i.Duty of care – That the professional is imposed with a duty of care to provide the advice in such manner so that no loss is caused by a person who is relying upon his advice. Due care and skill must be applied by a professional before any advice is furnished by him (Bolam v Friern Hospital Management Committee (1957 & Midland Bank Trust Co. v Hett, Stubbs and Kemp (1979). The professional must be aware that the plaintiff is relying on is advice and thus is his neighbour and must adequate provide advice so as to mitigate any loss. The loss which may be imposed is reasonably foreseeable. In George Hawkins v Chrysler (U.K.) and Burne Associates (1986) it was submitted that the professional development must provide as far as possible adequate advice especially in exceptional circumstances, that is , when he is aware that his advice will be relied upon. (Powell 2016)
Once duty of care is established, the next important elements are breach of duty of care.
ii.Breach of duty of care – when the professional who is furnishing expert advice provides the advice but did not match the level of care and standard that is required while furnishing such advice, then the duty is considered to be violated. In Clack v Wrigleys Solicitors LLP (2013) the courts held that if the professional does not cater all due care and skill that is required in a given situation then such defendant or professional can be sued under the law of negligence and must pay compensation for the loss so suffered by the plaintiff. (Salter 2013)
After the breach of duty is also established against the defendant, then, lastly damages must also be suffered by the claimant.
iii.Damage – Once the duty of care is violated by the professional while furnishing advice, then loss must be caused to the plaintiff who is relying on the advice so furnished by the professional. The loss so caused must not be remote and must be easily predictable by the professional while giving advice and the loss so caused to the plaintiff must be the direct result of the wrong advice so furnished by the professional. In Lennon v Commissioner of the Metropolis (2004), that when a claimant is relying on the expert knowledge of the professional and suffers losses berceuse of such advice, then, damages are sustained by him because if professional negligence and the defendant must make good of such losses. (Pearson 2016)
When all the essentials of the law of negligence are proved, then the professional can be held liable for acting negligently and causing harm to the plaintiff. A person can protect himself under the law of negligence provided the liability is excluded by the defendant. One of such act is when specific exclusion clause is made while furnishing advice and the exclusion clause is brought within the knowledge of the plaintiff prior furnishing advice. (RPC 2016)
Now, the law is applied to the facts.
Application and conclusion
Now, when the law is applied to the facts, Faisal provided the details of his accountant while applying for a rented flat from Schneur. Schneur then applied to the accountant (Patricia) to gain information regarding the financial position of Faisal.
In such situation, Patricia was a professional and she is aware that Schneur is relying on her advice prior granting tenancy to Faisal. Thus, it is her duty to provide adequate care when furnishing any advice. On the contrary, Patricia did not comply with the standard of care that is required from her and she confuses Faisal with another client and does not bother to check the file properly. She replies to Schneur that Faisal is an excellent client with high income and capital and recommends him as a tenant. Rather, in reality, Faisal was continuously in overdraft and had been in serious debt with various banks on and off for several years.Thus, she did not perform with adequate duty of care and thus causes loss to Schneur. Thus, Patricia is negligent in her acts and is liable to compensate Schneur.However, Patricia while furnishing advice incorporated a clause, that is, ‘this firm will not accept any liability for inaccuracy contained in this reference or any loss incurred as a consequence’. The clause is applicable only when the same is brought within the knowledge Schneur while furnishing advice.Thus, Schneur can sue Patricia under the law of negligence; however, Patricia can exclude her liability of can prove that the exclusion clause was within the knowledge of Schneur.
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