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Economic Loss & Negligent Misstatements questions and answers

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Introduction

Seminar 8 (Week 10): Economic Loss & Negligent Misstatements ________________ Sven, an accountant, is asked by Erik to value shares in Bell Enterprises Ltd to discover whether they are likely to prove a good investment. Sven and Erik are old friends and Sven states that he will value the shares for ?old times? sake? but that any statement which he makes as to the investment value of the shares is to be treated as a statement of opinion and that no reliance is to be placed thereon. Sven?s report states that the shares are certain to be a good investment. Erik leaks the report to the Morning Star, which duly publishes it. ...read more.

Middle

- Sven stated that he would value the shares for ?old times? sake? ? only an opinion and not to be relied on 2. Accountant ? Galoo v Bright Grahame Murray 2. Consider whether C?s economic losses recoverable from D in the following cases? 1. D advises C to invest his money in Bellnet plc. The company collapses and C loses his money. In order to meet his immediate financial needs, he has to borrow at a high rate of interest. 1. If D is a professional, and it was said in a professional (advice) circumstance then D will be liable for the loss. 2. However, if it is in a friend (social situation) ...read more.

Conclusion

C is given as a present a computer manufactured by D. There is a fault in the hard disk and C has to spend £500 putting it right. 1. Purely a present – there is no economic loss, as he did not buy the laptop it was a present, it was his choice to buy a new hard drive 1. C is given as a present a computer manufactured by D. There is a fault in the hard disk. As a result files containing the draft of his doctoral thesis are corrupted and C loses six months of his research work. 1. Would be hard to value what his research would cost? 2. Also a present 1. C has made a contract with X to maintain X’s central heating system for a fixed sum for a year. D negligently causes extensive damage to the system. 1. Liable for the damage caused ...read more.

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