ch. 19 - Liability risk

Liability Insurance

Insurance for what a policyholder is legally obligated to pay because of bodily injury or property damage caused to another person

Legal Wrong

A violation of a person’s legal right, or a failure to perform a legal duty owed to ca certain person or to society as a whole

Legal Wrong Include:

crime, breach of contract, tort

Tort

A legal wrong for which the law allows a remedy

Three Classifications of Tort

• Intentional

• Strict liability

• Negligence

Strict Liability (Tort)

Liability is imposed regardless of negligence of fault

Negligence (Tort)

Failure to exercise the standard of care required by law to protect others from unreasonable risk of harm

Intentional Tort

Cause harm or injury to another or damages property

Conduct that is malicious, purposeful or knowingly committed

Examples of Intentional Tort

• Assault

• Battery

• False Imprisonment

• Infliction of distress

• fraud

• Misrepresentation

• trespass

• Conversion/interference

• Defamation

Elements of Negligence

• Existence of a legal duty to use reasonable care

• Failure to perform that duty

• Damage or injury to the claimant

Proximate Cause

Relationship between the negligent act and the infliction of damages, which requires an unbroken chain of events

in other words, Direct Cause.

Res Ipsa Loquitur

“The thing speaks for itself”

The very fact that an injury or damage occurs establishes a presumption of negligence

Requirements for Res Ipsa Loquitur

1. The events is one that normally does not occur in the absence of negligence

2. The defendant has exclusive control over the instrumentality causing the accident

3. The injured party has not contributed to the accident in any way

Law of Negligence

Compensatory, damage, special damages, general damages, punitive damages

Compensatory Damage

Compensate the victim for losses actually incurred

Special Damages

Provide compensation for medical expenses

General Damages

Provide compensation for pain and suffering

Punitive Damage

Designed to punish people and organizations so that others are deterred from committing the same wrongful act

Contributory Negligence Law

The injured person cannot collect damages if his or her care falls below the standard of care required for their protection

Basically the person cannot collect damage if they are the reason why they are injured

Comparative Negligence Law

The financial burden of the injury is shared by both parties according to their respective degree of fault

Pure Rule

You can collect damages even if you are negligent, but your reward is reduced in proportion to your fault

50 Percent Rule

You cannot recover anything if you are 50% or more at fault

The Last Chance Rule

Even if the injured person was careless or negligent and put themselves in danger, they can still recover damages if the defendant had a clear opportunity to avoid the accident right before it happened and failed to take action

Assumption of Risk Doctrine

By choosing to participate in an inherently risky activity, the participant legally accepts those known risks and waives the right to sure others if an injury results from those expected dangers

Imputed Negligence

Under certain conditions, the negligence of one person can be attributed to another

Ex) Vicarious Liability Law, family purpose doctrine, dram shop law

Vicarious Liability Law

A vehicle owner can be held legally responsible for negligence committed by someone else who was driving their vehicle with permission

Family Purpose Doctrine

Extension of viacarious liability where the owner of the vehicle is held liable for negligent driving act commited by immediate family member.

Dram Shop Law

A store that sells alcoholic beverages can be held legally liable for injuries or property damage caused by an intoxicated customer after leaving the store

Attractive Nuisance

Hazardous condition that can attract and injure children

Sovereign Immunity for Government Entity

Used to be a law that said governmental entities were immune from a lawsuit

Respondeat Superior

An employer can be held liable for the negligent acts of employees while they are acting on the employer’s behalf

Current Tort Liability Problems

1. A defective tort liability system

2. Medical Sector claims

3. Class action lawsuits

Defective Tort Liability System

• Rising tort Liability costs

• ineffieciency in compensating injured victims

• Uncertainty of legal outcomes

• Long delay in setting lawsuits

• High jury award

Medical sector claims

• Medical malpractice

• Errors

Class Action Lawsuits

Law first initiate the process and represent on behalf of a group of indiviudal

Lawyer - pro , business - con

Cyber Liability

Threat to personal and financial recoreds, steal intellectual property

Public Entiy

accident with a car and city bus, sexual abuse, police shooting

Technological innovation

Drone crash, software failure