Term Paper on "Negligence Misstatements in the Law"

Term Paper 2 pages (797 words) Sources: 10 Style: Harvard

[EXCERPT] . . . .

In the letter Swale believed this would give the Mullins enough time to lease the 6th floor even though it might have taken somewhat longer for the 7th[footnoteRef:5]. The "somewhat longer for the seventh" was regarded as additional month and there was no indication that this constituted negligence in the circumstances. Mullins alerted Swale that they would begin negotiations on sub-leasing the Citibank space. Because of the market crash, no tenants were found. Mullins later sued Richard Ellis; Mullins claimed that Richard was negligent by not amending their advice with respect to leasability of the original offices after the stock market crash. (Richard Ellis (W.A.) Pty Ltd. v Mullins Investments Pty Ltd. (in liq), 1995). At the trial, the judge ruled in favor of Mullins, on the basis that the advice had 'a continuing effect and operation'[footnoteRef:6]. Later the Supreme Court disagreed with the ruling citing lack of reliance by Mullins on the advice at the time of the formal offer. The Court claimed that was no reliance on the representation.[footnoteRef:7] [4: Richard Ellis (W.A.) Pty Ltd. v Mullins Investments Pty Ltd. (in liq). (1995). Aust Torts Report.] [5: Ibid 81-309, 62,090. ] [6: ] [7: Richard Ellis (W.A.) Pty Ltd. v Mullins Investments Pty Ltd. (1995). Aust Torts Reports 81-309, 62,084. ]

It appears well established that pure economic loss can be recovered in cases where the defendant assumed the position of the claimant. Liability might therefore rise from negligent statements. Here the burden of proof is on the person who made the negligent statement, to make an innocent defense by proving that the comment was not one of fact, but rather opinion and that "had reasonable ground to believe and did believe up to the time the contract was made that the facts represented were true."

Bibliography

Elliott, C., & Quinn, F. (2007). Tort Law. London: Longman.

Hedley Byrne & Co Ltd. v Heller & Partners Ltd. . (1964). AC 465.

Richard Ellis (W.A.) Pty Ltd. v Mullins Investments Pty Ltd. (in liq) . (1995). Aust Torts Reports 81-309, 62,090.

Richard Ellis (W.A.) Pty Ltd. v Mullins Investments Pty Ltd. (in liq). (1995). Aust Torts Report.

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