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Law of Tort College - Essay Example
Alan passes the report to another friend, Brian, who needs a van for business purposes. Brian reads the report and, on the strength of it, buys the van. Later Brian realises that there are defects with the vehicle that are not mentioned in the report and the van is not capable of performing the demanding business function…
The production process is interrupted and all the materials in process are damaged beyond repair. In addition, because there is no water supply for 24 hours Brian loses the opportunity to carry out several more processes and loses the profits that these would have generated.
An analysis of the facts of the case presents certain ambiguous legal issues within the premise of both common law as well as the law of torts. In the first situation, the issue is whether Derek's statement to Alan about the efficacy of the van, and the consequent economic loss to Brian, imposes a liability in tort on Derek and/or Alan. In the second situation, the issue is whether Brian can claim economic damages for the losses he has suffered in terms of equipment and material damage and by way of profit loss due to operations shut down resulting from Donald's negligent action.
The first situation --Brian v. Derek/Alan - relating to Brian's purchase of van prima facie pertains to area of 'pure' economic loss due to negligent misstatement, resulting in tortious liability under common law.1 The second situation --Brian v. ...