TORT OF NEGLIGENCE

Business Affairs Manager- Tort Negligence and Duty of Care



Business Affairs Manager- Tort Negligence and Duty of Care

The Facts

A team of gymnast were training for the Commonwealth Games. Many companies approached them for different advertisement purposes. The company I work for, Sweet Eats, also volunteered provide the team with a healthier option of snacks in the form of a chocolate bar. This offer was made free of charge. It was discovered that the Captain of the team was allergic to nuts and specially asked the company to make peanut free bars for the games.

It was the Sweet Eats' policy to clean the machine after every round of production of the bars. Mistakenly one of the rounds was neglected, and the chocolate had traces of peanuts. When the Team captain had a bar, she experienced an allergic reaction. She was then hospitalised, and she lost a great deal. As the Business Affairs Manager of the Sweet Eats, I have to advise my Board of Directors regarding the liability towards the team under tort of negligence

Case Background: Donoghue Case (1932)

The Donoghue V Stevenson is the case which played as the foundation element for the English tort law. This law frames out how one person owes to another person the duty of care. This case is the mother of the modern concepts of negligence. The case was based on the incident in which Mrs Donoghue had a drink of ginger beer which had a partially decomposed snail in it. She eventually fell ill and was diagnosed with severe gastroenteritis and sued the manufacturer named Mr. Stevenson. After a series of hearings, the House of Lords came upon the result that Mr. Stevenson owed duty of care of negligence for Mrs. Donoghue. She finally won the case later. This case changed the perception of tort of negligence cases in the twentieth century. After this case, Lord Atkins implemented a new rule: The duty of care. This law placed the duty of care to the consumer along with the purchaser.

Case Background: The Caparo Case (1990)

An electrical equipment company named Fidelity plc was a target of takeover by the Caparo Industries plc. In the March of 1984, fidelity was not doing well and had issued a profit warning. It split its share price and by the month of May of the same year, the directors of Fidelity plc made the first round of announcements declaring the negative outcomes. This resulted in further drop in the share price. In June the same year Fidelity's accountant Dickman prepared an annual report that showed the drop in shares to all the shareholders.

The Caparo plc acted smart and bought larger amounts of share from the Fidelity plc. When Caparo plc reached the 29.9% share holding target it statistically offered Fidelity to sell all the remaining shares. This step was taken in accordance with the City Code's rules related to the takeover. Later it was revealed by the auditors that Fidelity was in even worse ...