PAPER: LAW MARK AWARDED: 73% Question 1 The overriding objective was recently modified in the Jackson reforms and recites as follows. 1) These rules are a new procedural code with the overriding objective of enabling the courts to deal with cases justly and at proportionate cost. 2) Dealing with cases justly and at proportionate cost includes, so far as is practicable: i) ensuring that the parties are on an equal footing ii) iii) saving expense dealing with cases in ways which are proportionate to: a) the amount of money involved b) the importance of the case c) the complexity of the issues d) the financial position of the parties. 3) Ensuring that the case is dealt with fairly and expeditiously. 4) Allotting to the case an appropriate share of the court s resources while keeping in mind the need to allot resources to other cases. 5) Enforcing compliance with practice directions, rules and orders. The court is under a duty to further the overriding objective when it a) exerts any power given to it by the rules, b) interprets any rule. The judge must further the overriding objective by actively managing cases. Courts used are under a duty to further the overriding objective by, for example, settling their differences before trial. Question 2 Malicious falsehood may be claimed where the claimant has suffered damage as a result of the defendant s false and malicious statement. There are three elements laid down in Kaye v Robertson which need to be satisfied in a claim of this type: 1) The statement made was false with the person making the statement knowing the falsity of what is said. 2) The statement needs to have been said maliciously i.e. with the intent to injure or damage the claimant or the claimant s property without just cause or excuse. 3) Special damage needs to have been caused as a direct result of the statement. A claimant does not have to prove special damage if a) the statement was calculated to cause pecuniary damage to the claimant and was published in permanent form or 1
b) the statement was calculated to cause pecuniary damage and is directed at the claimant s business. In this case the claimant claims for probable pecuniary damage. Claims for malicious falsehood typically arise in comparative advertising, where a defendant will normally claim the statement is mere puff see DSG Retail Ltd v Comet Group Plc which set out the following criteria to assess if the statement is just mere puff: 1) Who was the statement aimed at? 2) What was its meaning? 3) Was it false in its meaning? 4) Was it intended to be taken seriously? 5) Was it published maliciously? 6) Did damage occur as a result of the statement? Question 3 Testimony This is any statement made by a witness in court under oath as proof of its contents. E.g. Mrs X states: I saw the accused strike the defendant. Testimonies are admissible in court. Hearsay This is any out of court statement offered as proof of its contents. E.g. Mrs X States: Y told me she saw the accused strike the deceased. A witness statement presented in court where the witness was unable to attend will be taken as hearsay. Hearsay is admissible in court. However, section 4 of the Civil Evidence Act gives criteria to assess the weight to assign to hearsay e.g. - Has the statement been edited? - Was it reasonable for the witness not to attend? Real Evidence Material objects produced for inspection by the court, e.g. the alleged product that infringes a patent. Documentary Evidence Documents produced for inspection by the court. A document is anything on which information can be recorded e.g. letters, e- mails, CDs. Expert Opinions Generally, witness opinions are not admissible in court. Expert opinions are an exception to this rule. The aim of the expert is to assist the court in deciding specialist matters. 2
E.g., a registered patent attorney being called to give his/her opinion on the duties of a patent attorney Baillie v Bromhead. The duty to aid the court overrides any duty the expert has to the person from whom he receives instructions. Question 4 1. Offer This is an unequivocal offer of the terms of a contract with the intention that on its acceptance it becomes binding. The leading authority on offer and acceptance (see below) is Carlill & Carbolic Smoke Ball Co. The price tag on an item for sale in a shop is not an offer, it is an invitation to treat, see Fisher v Bell. An invitation to treat is an offer to consider offers. 2. Acceptance This is the final and unqualified acceptance of the terms of the offer. Acceptance must be communicated Felthouse v Bindley. Acceptance can be written, verbal or implied by action Peter Lind v Mersey Docks & Harbour Board. Qualified acceptance is not acceptance; it is a counter offer Butler Machine Tool Co v Eso-cell-o-corp. A counter offer kills any previous offer so it is not capable of subsequent acceptance Hyde v Wrench. This details the first two stages to form a collateral contract. However, a uni-lateral contract is one where the offeror makes an offer to an undefined group of people to either do, or refrain from doing an act. Acceptance is completed by anybody performing the act. Carlill v Carbolic Smoke Ball Co. Consideration This is the price for which a promise is bought. It must move from the promise. It does not have to be adequate, only sufficient see Bainbridge v Firmsbone. Past consideration is not consideration at all Roscorla v Thomas. Intention to Create Legal Relations In domestic arrangements this intention is generally presumed not to exist Balfour v Balfour. In commercial arrangements it is generally presume that this intention exists. However, the court will take an objective approach in both cases. 3
Question 6 a) A limited company The formation of a limited company is closely controlled by statute. To form a limited company you need to submit to Companies House: a) Memorandum of association b) Articles of association c) Form IN01 d) Declaration of compliance e) Official fee Advantages The main advantage is that the owners have limited liability for the debts of the company, which is limited to their share value. Other individuals not previously involved in the business may buy shares in the company thus providing a source of capital for the company. It is easier to form contracts with and in the company. Disadvantages The day to day dealings and accounts of the business are made public. Due to the issuance of shares, control over the business is lost to a degree. There are many formalities in forming the company. b) A partnership is when two or more people go into business together. However, the maximum number of partners is limited to 20. Partners pay income tax and VAT. Advantages No formalities the partnership automatically arises. No written agreement between partners required. However, a contract is usually written up regardless. The risk and cost of owning the business is spread between the partners. Disadvantages Each partner has unlimited liability for the debts of the business. Each partner is responsible for the actions of other partners. Old partners are still liable for their past actions. c) A Limited Liability Partnership (LLP) is similar to a regular partnership. However, in this case the liability of each partner is limited. Advantages Few formalities. Limited liability of each partner for the company s debts. Can have more than 20 partners. Disadvantages Have to disclose accounts to the public. d) A sole trader is someone who has gone into business by themselves. 4
Advantage The business automatically arises and no formalities are required. The individual person runs the business themselves privately. Disadvantages The main disadvantage is the unlimited liability of the individual for the debts of the company. The individual also has to raise their own funds for the company. Question 7 The criteria necessary to establish in an application for an interim injunction are laid down in American Cyanamid v Ethicon as follows: 1) There must be a serious issue to be tried. 2) Damages must not be an adequate remedy i.e. damage to reputation to brand or company and the pecuniary damage is difficult to determine. 3) You have to weigh up the damage caused to the claimant if the injunction is not granted vs the damage caused to the defendant if it is granted. 4) You should consider what would happen if the status quo was maintained. 5) This is a last resort only. The above is known as the balance of convenience test. The court will consider the merits of each case especially if the granting of the injunction will settle the matter as it will likely become final relief then. These criteria were further supplemented upon by Laddie J in Series 5 software v Clarke who said that the prospects of success by the applicant must be taken into account. When applying for an interim injunction the applicant must supply a crossundertakings to damages: i.e., the applicant will compensate the defendant if it turns out that the injunction was wrongly given. This is an equitable defence and therefore discretionary. The maxim of coming to court with clean hands applies. Material non-disclosure by the applicant will lead to the order being set aside. Any delay by the applicant in the making of his application will more than likely lead to it being set aside. Please note, an interim injunction is a court order to a defendant to either do something (mandatory) or refrain from doing something (prohibitory). The order is temporary pending further decision, usually at trial. 5
Question 8 Primary Sources of European Law: Treaties e.g., the Treaty of Rome. The Treaty on the functioning of the European Union (TFEU) lays out how the European Union (EU) operates. Treaties are binding and directly applicable in member states. Treaties supersede any UK law to the contrary. This makes community law part of UK law e.g. the European Communities Act. An individual in the UK may rely on the provisions set out in a treaty in any claim. Factor tame. The UK courts will now interpret and apply treaties in the courts. Treaties have both horizontal and vertical direct effect. Horizontal direct effect means that individuals may rely on the provisions in a treaty against other individuals. Vertical direct effect means that individuals may rely upon the provisions in a treaty in any claim they have against the government. International Treaties These are negotiated by the European Commission on behalf of the EU and are binding on member states. Secondary Sources of European Law: Regulations Article 288 TFEU Binding in every respect and directly applicable to member states. The UK does not generally have to subscribe to the regulations. Regulations have direct effect (both vertical and horizontal) in member states which have subscribed to them. e.g. community designs regulations. Directives Article 288 TFEU Directives detail the result to be achieved. However, it is up to the Member state on how they want to implement them. The European Commission will provide a time limit for their implementation. If they are not implemented in time an individual may rely on them directly in any claim against the government Frankovich v Italy. However, if they are not implemented in time they may not be used in individual claims against other individuals. Directives are the best way to bring about harmonisation between EU and domestic laws. Decisions These are issued under the powers of article 288 TFEU and are generally administrative in nature. They are directly applicable on the member states and individuals to whom they are addressed. 6
Directives (Continued) Directives are not directly applicable and are usually incorporated into UK law to Statutory instruments. Question 9 In all these cases the question is whether for the general people, are there valid claims in the tort of negligence? Briefly, to prove negligence you must satisfy the following 4 elements. 1. Duty of care Did the defendant owe a duty of care to the claimant? Apply the neighbour principle as in Donoghue v Stevenson i.e., a person owes a duty of care to those whom he can reasonably foresee as being affected by his actions. You also have to apply the elements in Capaso v Dickman: - forseeability, proximity and is it right that the law imposes a duty of care? 2. Breach of Duty Was there a breach of this duty? Use the reasonable man test: a) Likelihood of damage occurring b) cost/practicability of preventing damage from occurring c) seriousness of damage that occurred d) importance of object to be attained. 3. Causation Was there any causal connection between the defendant s act and the claimant s loss? Use the but for rule i.e. but for the defendant s act, would the claimant have suffered the loss? 4. Remoteness (legal causation) As in the Wagon Mound Case Was the type of damage that occurred reasonably foreseeable? These are a number of claims here so I will go through them individually. Simon v Karen Karen owed a duty of care to all road users (including Simon) to make sure her car was road worthy. As Karen knew the car was not road worthy, she breached this duty. Simon suffered injuries as a result of Karen not being able to stop, therefore there is a causal connection. It is reasonably foreseeable that the type of damage that occurred did occur. All four elements are satisfied. Karen may be sued for negligence. However, Karen will more than likely win this case by claiming ex turpi causa, i.e., no person may bring an action in negligence when he was committing a crime (or doing something immoral) at the time of the crime. 7
Simon was stealing a car, case is thrown out. See Gray v Thomas Trains. Terry v Karen This case is exactly the same as the case for Simon v Karen. Karen is negligent. However, Karen wins by claiming ex turpi causa. Karen v Simon Simon owes a duty of care to all road users, including Karen. Simon breached this duty by overtaking when it was not safe. Simon caused Karen s injuries. Simon is legally responsible for the damage. Simon is negligent. However, as Karen was not wearing her seat belt Simon may claim contributory damage i.e., Karen was partly at fault for the damage. Furthermore, as Karen knew the car had failed its MOT, Simon may also claim ex turpi causa as it is illegal to drive a car without a valid MOT. Ben v Karen Karen owed a duty of care to Ben as her passenger. This duty was breached as Karen knew the car had failed its MOT. Ben s injuries were a direct cause of Karen s breach. Karen is legally responsible. Ben has a claim against Karen in negligence. However, Karen may defend with contributory damage i.e., Ben knew the car had failed, this results in a reduction in damages not a total dismissal. Furthermore, Karen may claim volenti non fit injuria i.e., a person who voluntarily puts him or herself in a position which would likely result in harm will have no claim this removes all negligence from Karen. Ben v Simon For the same reasons as with Kerry, Simon is negligent towards Ben. However, as with Ben v Karen, Simon may claim volenti or contributory negligence. 8