The Legal Framework

Question 1

What are the main types of legal systems in the western world?

Answer 1

1- Civil law systems, which emphasise a complete code of written law.

2- Common law systems, which are more reliant on the decision making of judges.

Question 2

What is the common law system?

Answer 2

The common law system used in New Zealand as well as many countries colonise by the English, are laws that are made by judges (called common-law) or by parliament (called statute law).

Question 3

What model of government does New Zealand use, and how many levels of government does it have?

Answer 3

New Zealand is a constitutional monarchy and there is 1x level of government known as House of Representatives.

Question 4

Name the various branches of government related to lawmaking and briefly describe them?

Answer 4

1- The legislature- responsible for making law. Made up of ministers of parliament and select committees who examine and debate bills, which went passed become law.

2- The executive- responsible for initiating and administering the law. Made up of cabinet ministers, government departments etc, who decide policy, draft bills, enforce and administer Acts.

3- The judiciary- responsible for applying the law. Made up of judges and judicial officers who hear and decide cases by applying the relevant facts as well as conducting judicial reviews of administrative decisions.

Question 5

What areas of law to New Zealand courts generally deal with?

Answer 5

1- Criminal law.

2- Civil law.

Question 6

Describe a criminal law case?

Answer 6

A criminal case is brought before the courts by the state or district in the name of the crown. The crown can bring proceedings against a person or an entity for committing a crime. The guilt of the accused must be established be on reasonable doubt.

Question 7

Describe a civil law case?

Answer 7

A civil case involves an individual or entity bringing an action against another individual or entity. Civil law can be divided into the following-

• Public law- involves government bodies etc
• Private law- involves individuals etc

Question 8

What is the hierarchy of courts in New Zealand from highest to lowest?

Answer 8

1- Supreme Court
2- Court of Appeal
3- The High Court
4- The district court
5- Tribunal such as the disputes tribunal

Question 9

What is the doctrine of precedent?

Answer 9

Under the doctrine, previous court decisions are available for other judges to use as guidelines for arriving at decisions in current cases.

Question 10

How does the doctrine of precedent operate within the court system?

Answer 10

The doctrine of precedent means the decisions of higher courts are binding on lower courts where they are considering similar facts, circumstances, legislation etc. therefore only an equal or higher court than the one that set the original precedent can overrule the precedent.

Question 11

How is statute law created?

Answer 11

The first step in making statute law is for someone within parliament to make a proposal for new legislation. The proposed law(Bill) is given three readings in parliament. Once passed, it then becomes an act of parliament and part of statute law.

Question 12

What main sources are used in the interpretation of statutes?

Answer 12

1- The objectives/aims section and definitions section of the Acts
2- Any explanatory memorandum to the Act
3- Parliamentary speeches
4- Earlier cases where identical or similar wording or legislation has been considered

Question 13

What are the remedies available when any person or organisation breaches a statue by an act or omission?

Answer 13

1- They may be liable for penalties prescribed in the statute.

2- May give rise to a civil claim for damages.

Question 14

Name 3x Acts that could provide a defence for a manufacturer or supplier when charged with the breach of a commercial/retail statute law?

Answer 14

1- Limitation Act 1950
2- Contributory Negligence Act 1947
3- Consumer Guarantees Act 1993

Question 15

What is the law of tort?

Answer 15

A tort can be defined as a civil wrong. It is an act or omission by a person, without just cause or excuse, which caused some form of harm to the person or property of another.

Question 16

Explain the law of torts in comparison to the purpose of the law of contracts?

Answer 16

1- The law of contract exists primarily to in force promises made by one person to another.

2- The law of tort exists to compensate the person injured by a wrongdoer, when the person injured and the wrongdoer are not in a contractual relationship.

Question 17

In any negligence action, the plaintiff must show what?

Answer 17

1- Is that the defendant owed a DUTY of care.

2- That the defendant BREACHED the required standard of care.

3- The defendants breach of the standard of CARE caused the damage alleged by the plaintiff.

4- The defendant should reasonably have FORESEEN that the particular damage or injury suffered would result from their conduct.

Prompt-

Do
Be
Careful
Fuckwit

Question 18

Discuss ‘Duty of Care?

Answer 18

A duty of care is the legal requirements of one party to protect the legally conferred rights of another party. This means that when one party has legally protected rights, there is a duty upon others to-

1- Respect those rights.
2- Abstain from acting in a way that would prejudice or damage those rights.

Question 19

What are the legal requirements to determine if a defendant owed a ‘duty of care’?

Answer 19

A duty of care is owed only to those whose relationship to the defendant is sufficiently proximate, that is, physically close in space and time.

Question 20

If duty of care is shown to exist, the plaintiff must show that the defendant ‘breached’ the required standard of care. What is the test for the required standard of care?

Answer 20

The test for the required standard of care, is how a reasonable person in a particular situation would have acted. Consideration needs to be given to the likelihood of the risk, counterbalanced against the cost, difficulty and inconvenience of acting to prevent that risk.

Question 21

With regard to ‘causation’, what must the injured party establish?

Answer 21

The injured party must establish that the breach by the defendant caused the injury, loss or damage.

Question 22

With regard to foreseeability, what must the plaintiff establish?

Answer 22

The plaintiff must establish that the injury, loss or damage suffered is not too remote a consequence of the defendants breach of the duty of care. The defendant is only liable if the injury, loss or damage was reasonably foreseeable from the defendants negligence.

Question 23

True or false? If the injury, loss or damage is consistent with that which was reasonably foreseeable, the defendant will be liable even if the injury, loss or damage was more extensive than could have been reasonably foreseen?

Answer 23

True.

Question 24

Discuss the Mainguard Packaging Ltd v Hilton Haulage 1990 case law example?

Answer 24

In this case H reversed his truck, striking a power cable opposite M’s factory. Not only did the impact cut power to the factory causing a loss in production, a power surge followed which caused a fire destroying the factory’s PABX room.

It was held that the economic loss that resulted was foreseeable given that the driver knew of the power pole and ought to have foreseen the likelihood of cutting power on impact, especially in a semi industrial area.

Question 25

Discuss occupiers liability?

Answer 25

The occupier is defined as the person in control of the premises. The occupier of the premises has a duty of care owed to an entrant onto those premises or to a person outside the premises.The key information that needs to be ascertained in such cases is which occupier i.e. owner or tenant, owes the duty of care.

Question 26

What is the key method in order to determine the liability of an occupier of the premises after an incident?

Answer 26

The liability of an occupier of premises, to entrants onto those premises, usually depends on whether the principles of the tort of negligence are satisfied.

Question 27

What method can an occupier of a premises use to limit their obligations with regard to their liability to entrants to the premises?

Answer 27

The occupier may seek to limit its obligations by an EXCLUSION CLAUSE printed on a ticket issued to the entrant. However, courts have determined such exclusions have little effect unless brought to the specific attention of the entrant.

Question 28

What is strict liability?

Answer 28

Strict liability is the imposition of liability on a party without a finding of fault. The law imputes strict liability to situations it considers to be inherently dangerous. It discourages reckless behavior and needless loss by forcing potential defendants to take every possible precaution.

Question 29

What are the three situations where vicarious liability can arise?

Answer 29

1- Employer and employee- although, an employer will only be liable for acts or omissions of its employees during the course of their work 2- Principal and agent 3- Partners

Question 30

What is the main principle, with regard to a remedy in negligence?

Answer 30

Remedies in tort are based upon the main principle of compensation, as compensation serves to restore the injured parties to the position they were in before the loss.

Question 31

What are the five defences in negligence?

Answer 31

1 - If a duty of care was not owed to the victim, the negligent person will not be liable for damages . 2 - If a duty of care was owed to the victim, it may be possible to establish that there was no breach of the duty of care that caused the damage . 3 - If there was a duty of care and it is established that the duty was breached, there may not be a direct connection, or chain of causation, between the negligent act and the damage claimed for. 4- There may be some act, or failure to act by someone other than the wrongdoer that intervened between the wrongdoers negligent act and the manifestation of the damage, so as to break the chain of causation. 5- The damage claimed for may be so remote from the wrongdoers negligent act as to not have been a reasonably foreseeable consequence of the act at the time it was performed and therefore not compensable.

Question 32

Define and discuss 'Novus Actus Interveniens'?

Answer 32

Definition- A new intervening act or cause of the damage. No matter how wrongful the defendants conduct may have been towards the plaintiff, the defendant is only liable for the damage caused by his act or omission to act, and its natural consequences. If something for which the defendant is not responsible occurs and causes damage, the chain of causation is broken and the defendant will not be liable for the resulting damage.

Question 33

Discussed contributory negligence/proportionate liability?

Answer 33

If the claimant for damages to compensate for the result of another's negligent act has himself contributed to this damage by his own failure to take due care for his own property, then the damages that will be recovered will be reduced in percentage terms by the extent to which is own negligence caused his own damage; is damages are reduced first contributory negligence.

Question 34

What is voluntary assumption of risk?

Answer 34

This is when the plaintiff has knowledge of the facts that constitute a dangerous condition and appreciate the nature of sense of the danger and voluntarily expose themselves to that danger. It is not sufficient for the defendant to prove simply that the plaintiff consented to an activity known to be dangerous.

Question 35

What is the definition of nuisance?

Answer 35

A nuisance may be defined as the unreasonable and substantial interference with the use or enjoyment of one's land. A public nuisance affects the public as a whole and is criminal; a private nuisance is a tort.

Question 36

True or false? A plaintiff alleging a nuisance is required to establish that the action of the defendant was negligent?

Answer 36

False. The plaintiff must only establish that there has been substantial and unreasonable interference with the enjoyment of his or her land.

Question 37

What information should be taken into account when determining a case of nuisance?

Answer 37

1- The nature of the area in which the alleged nuisance took place 2- The character, duration and time involved 3- The effect of the alleged nuisance 4- Consider the reasonableness and social usefulness of the defendant's actions

Question 38

What are the major defences for an action of nuisance?

Answer 38

1- Legislative authority. Such as statute set up to protect railways on council land from vibration complaints 2- Prescription. Such as a nuisance that has taken place over a long period of time with no previous objections 3- Contributory negligence

Question 39

Define Trespass?

Answer 39

Defined as a wrongful act done in disturbance of the possession of the property of another, or against the person of another, against that persons will. Largely limited to situations where the insureds actions were intentional.

Question 40

What is trespass to land?

Answer 40

Trespass to land occurs when there has been an intentional interference with a persons possession of land.

Question 41

What are the defences to an action for Trespass to land?

Answer 41

1- Had the right to possession of the land at the time of the alleged trespass, or that they acted under the authority of a person having such a right. 2- Entered on land in the exercise of a legal right, such as a statutory right to enter premises to affect an arrest, or the act complained of was involuntary.

Question 42

What is Trespass to goods?

Answer 42

Trespass to goods is the unlawful disturbance of the possession of goods by seizure, removal, or by the direct act of causing damage to the goods.

Question 43

What is the essential factor in proving a Trespass to goods?

Answer 43

Possession is the essential factor. The person suing in trespass to goods must prove actual possession or right to immediate possession at the time the unlawful act was committed.

Question 44

What is the main defence to an action for Trespass to goods?

Answer 44

The main defence to an action for trespass to goods is that the defendant had the right to possession of the goods at the time of the alleged trespass.

Question 45

What is Trespass to person?

Answer 45

Trespass to person is the intentional wrong committed directly against the personal security or personal liberty of another.

Question 46

What are three main types of Trespass to person?

Answer 46

1- Assault- The tort of assault contains a direct act or conduct by the defendant that causes a reasonable person to believe that force will be applied to his or her body. 2- Battery- The tort of battery requires that actual contact with the plaintiff occurs without the plaintiff's consent. 3- False imprisonment- The tort of false imprisonment occurs when the defendant puts a total restraint on the liberty of the plaintiff, and where the plaintiff has no reasonable means of escape.

Question 47

What are the main defences to an action for trespass to person?

Answer 47

1 - The plaintiff consented to the particular injury, such as where the injury was sustained in the course of the football match. 2- The defendant acted in self defence or in the defence of property.

Question 48

Define the law of defamation?

Answer 48

Defamation is a tort designed to protect the persons reputation, standing or position in society. Defamation can also be defined as the publication without justification by one person of a false and derogatory statement about another.

Question 49

What are the two types of defamation? Describe the two types of defamation in detail?

Answer 49

1- Libel- Libel is defamation in permanent form, such as written or pictorial matter. An actual loss is not required to bring an action for libel as the permanent nature for defamation is in itself damaging. 2- Slander- Slander refers to defamation in temporary form, such as the spoken word.

Question 50

In most slander cases an actual loss must be proven, except where the statement imputes that the plaintive is/has what?

Answer 50

1- Is unfit to carry on business, trade or occupation 2- Has an infectious or contagious disease 3- Has committed a serious criminal offence

Question 51

In all defamation actions, what three elements must the plaintiff prove?

Answer 51

1- The statement was defamatory. 2- Referred (not necessarily specifically by name) to the plaintiff. 3- It was published (this is, made known to another person).

Question 52

What are the remedies in defamation?

Answer 52

1- A public apology 2- An injunction 3- Damages 4- All(or a combination) of the above

Question 53

What are the defences against a defamation claim?

Answer 53

1- Plaintiff's consent to the publication 2- Truth or justification (that is, all material statements are true) 3- Fair comment made on a matter of public interest 4- Privilege (that is, legal protection such as statements made in parliament)

Question 54

What is the purpose of contract law?

Answer 54

Contract law exists primarily to enforce promises made by one party to another party.

Question 55

When determining whether a contract has been entered into, what factors will a court consider?

Answer 55

1- Whether there has been an offer 2- Whether the offer has been accepted 3- Whether there is a consideration- usually a payment 4- Whether there was an intention to create legal relations

Question 56

When determining the terms of the contract what do courts consider?

Answer 56

1- Express terms- i.e. the terms have specifically been discussed between the parties 2- Implied terms-i.e. the terms may not necessarily have been discussed specifically between the parties

Question 57

What are the six essential elements of a contract?

Answer 57

1- An intention to contract- The parties must intend to create legally enforceable obligations 2- Agreement between the parties- This involves an offer by one party and an acceptance by the other 3- Consideration- The party who accepts the promise must provide consideration (usually, but not necessarily, a payment) for the promise 4- Legal capacity- The parties must be legally capable of entering into a contractual relationship 5- Legality of purpose- E.g. a contract to commit a crime has no legal standing 6- Consent- The contract must be a genuine expression of the parties intentions.

Question 58

A contract that appears valid may not be if consent to the contract was based on what?

Answer 58

1- Mistake- When someone agrees to a contract based on a personal misunderstanding of the requirements of the contract 2- Misrepresentation- Similar to a mistake in that agreement to the contract is based on a misunderstanding, but in this case the misunderstanding is caused by the other party; the misrepresentation might be fortunate or innocent 3- Duress- Actual or threatened violence to a party's immediate family, threats against goods or property, economic pressure to gain a benefit not in the contract 4- Unconscionability- Behaviour that is unethical or unfair Prompt- MUDD

Question 59

With regard to privity of contract what is the general role?

Answer 59

The general rule of contract law is that only the parties who make the contract can be bound by its terms. However, in practice the courts frequently recognise that a contract may confer rights and liabilities upon a stranger to the contract or a third party.

Question 60

What are the remedies for breach of contract?

Answer 60

1- Compensatory DAMAGES- Damages are contained to those losses that the defendant knew, or could reasonably have known, would occur as a result of the breach. 2- INJUNCTIONS- Injunctions aim to stop another person behaving in a way that breaches the contract. 3- Specific PERFORMANCE of contract order- Such an order is used to compel a party to perform its contractual obligations. 4- RECTIFICATION of contract order- Where a contractual document doesn't accurately express the agreement reached between the parties, they can seek a rectification of the contract order. Prompt- DRIP

Question 61

What are the defences under contract law?

Answer 61

1- NO breach of contract- The court could determine that the defendant has fulfilled the express and implied terms of the contract. 2- FRUstration- Defence of frustration map live in an intervening event that is beyond the control of the parties to the contract makes it impossible for that contract to be fulfilled. 3- MISrepresentation- Applies when one party enters the contract in a situation where the terms or obligations are either intentionally or recklessly misrepresented by the other party. 4- CONtributory negligence - Possible defence when the plaintiff has in someway contributed towards the loss or damage. Prompt- NO FRU MIS CON

Question 62

Discuss the law of equity?

Answer 62

Equity developed as an alternative to common law. It was seen as a means of applying equitable decisions in cases in which, although strictly legal according to common law, there was an inequitable outcome.

Question 63

What are the two aspects in the field of equity that relate to liability insurance?

Answer 63

1- Unconscionable conduct- Unconscionable conduct means exploiting a weaker party in the course of doing business. 2- Fiduciary- A fiduciary is a person who assumes responsibility to act in trust and confidence in the best interest of another party. The fiduciary duty exists where a client trusts and relies upon the fiduciary's expertise.

Question 64

What defines a breach of fiduciary duty?

Answer 64

Fiduciary duty is determined according to whether or not the act or omission in question falls within the scope of the fiduciary obligation. If the act wasn't in the clients best interest, the fiduciary has committed a breach of the fiduciary duty.

Question 65

What are the remedies in equity?

Answer 65

1- Damages- Also known as equitable compensation 2- Specific performance of contract- The victim of a breach can enforce the exact performance promised if damages would be a poor substitute 3- The enforcement of trusts- Where someone who has been given title to property in order to manage it for someone else, is required to fulfil their fiduciary duty 4- Injunction- To prevent threatened or continuing wrong if damages would be a poor substitute 5- Restitution of benefits- Where a fiduciary has made a profit using the beneficiary’s money, the fiduciary can be forced to surrender the profit in order to prevent ‘unjust enrichment’

Question 66

What are the defences in equity?

Answer 66

1- Statute of limitations- The period that sets the limit within which claims can be made 2- Release- Defendant may be entitled to a release from liability for a claim if the plaintiff agreed to it in exchange for some valuable consideration 3- Laches and acquiescence- Defendants can successfully resist a claim if they can show that the plaintiff, by delaying the case, has acquiesced to the defendants conduct 4- Set-off- This applies where defendants can successfully present a counterclaim that absolves them from liability to the plaintiff Prompt- SSLR

Question 67

Discuss indemnity?

Answer 67

Indemnity is a common law principle that concerns the insureds entitlements under a policy of insurance. The aim of indemnity is to return insureds to the pre-los position.

Question 68

What is the test of indemnity?

Answer 68

1- What is the financial loss to the insured at the time in place of loss? 2- What terms of the insurance policy may modify the basis of indemnity?

Question 69

What is the four basic methods of providing indemnity?

Answer 69

1- Cash settlement 2- Replacement 3- Repair 4- Reinstatement

Question 70

Discuss subrogation?

Answer 70

Through subrogation, the insurer has all the rights of the insured against the third party who may have been responsible for the damage giving rise to the claim.

Question 71

What is the insureds duty with regard to subrogation?

Answer 71

1- The insured has a duty to allow the insurer to use their name in proceedings against third-party 2 - Give all necessary assistance to the insurer to successfully sue the third party

Question 72

Discuss contribution?

Answer 72

Contribution is the right of an insurer who has paid out under a policy to call upon other insurers, who are equally or otherwise liable for the same loss, to contribute to the payment.

Question 73

For contribution to operate, what conditions must be fulfilled?

Answer 73

1- The policy is concerned must all cover the same PERIL which caused the loss 2- They must protect the same INTEREST of the same insured 3- The policies must both have been in force at the time of the loss 4- They must relate to the same SUBJECT matter Prompt- PIPS

Question 74

Discuss average?

Answer 74

The application of average has been a method whereby insurers seek to prevent people from deliberately under-insuring their property. This is fair because when under insurance applies, the insured is failing to pay a premium into the premium pool that is equal to the value of property at risk to partial loss/damage.

Question 75

What does section 15 of the insurance law reform act 1995 prevent?

Answer 75

Prevents the application of average in respect of any policies that cover a building and its contents, where the building is primarily used for domestic or residential purposes.

Question 76

What does section 16 of the insurance law reform act 1985 allow?

Answer 76

Section 16 allows the application of average in respect of any other types of policies, other than marine insurance contracts.