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Chapter

Cover Business Law

12. Non-Physical Damage and Liability for Economic Loss  

This chapter continues on from the previous chapter in discussing liability in negligence for physical damage and considers the potential liability that businesses and individuals may face when they provide advice in the nature of their business, when they cause economic losses not associated with physical damage, and where the claimant suffers a psychiatric injury or nervous shock due to the acts of the tortfeasor. Recently, there has been an increase in instances of imposing liability on employers for the stress and associated health problems suffered by their employees. In the absence of physical damage, restrictions are placed on the imposition of liability for pure economic loss, although such loss has been widened to include damages for negligent misstatements. Of crucial importance is that businesses are aware of the implications of providing information in the course of their professional activities that may cause an investor or client loss through negligence.

Chapter

Cover Mayson, French & Ryan on Company Law

17. Company officers, secretary and auditor  

This chapter focuses on company officers (secretaries, auditors and managers), with emphasis on their responsibilities and liabilities under the Companies Act 2006 (CA 2006) and the appropriate sanctions for breach of its requirements. It first considers who, in general terms, is an ‘officer’ or ‘manager’ of a company for the purposes of criminal or fiduciary liability. Then it deals with the appointment and qualifications of secretaries and the appointment and reappointment of auditors. There is discussion of auditors’ remuneration, integrity and independence, the required contents of an auditor’s report and an auditor’s investigative powers. There is analysis of an auditor’s liability in contract and tort for negligence in carrying out the audit and negligent misstatement in an auditor’s report. The chapter cites relevant legislation, including CA 2006 and UK Corporate Governance Code, and considers two particularly significant cases: Caparo Industries plc v Dickman [1990] 2 AC 605 and Stone and Rolls Ltd v Moore Stephens [2009] UKHL 39, [2009] AC 1391.

Chapter

Cover Mayson, French, and Ryan on Company Law

17. Company officers, secretary and auditor  

This chapter focuses on company officers (secretaries, auditors and managers), with emphasis on their responsibilities and liabilities under the Companies Act 2006 (CA 2006) and the appropriate sanctions for breach of its requirements. It first considers who, in general terms, is an ‘officer’ or ‘manager’ of a company for the purposes of criminal or fiduciary liability. Then it deals with the appointment and qualifications of secretaries and the appointment and reappointment of auditors. There is discussion of auditors’ remuneration, integrity and independence, the required contents of an auditor’s report and an auditor’s investigative powers. There is analysis of an auditor’s liability in contract and tort for negligence in carrying out the audit and negligent misstatement in an auditor’s report. The chapter cites relevant legislation, including CA 2006 and UK Corporate Governance Code, and considers two particularly significant cases: Caparo Industries plc v Dickman [1990] 2 AC 605 and Stone and Rolls Ltd v Moore Stephens [2009] UKHL 39, [2009] AC 1391.

Chapter

Cover Tort Law Concentrate

4. Pure economic loss and negligent misstatement  

This chapter discusses the law on pure economic loss, which is loss that is not derived from physical injury, death, or property damage. It may be consequential, that is resulting from the acquisition of a defective product or property. More commonly, the issue arises due to a negligent misstatement, or provision of professional services. This is an area of commercial and professional importance where there has been a trend towards expansion in the area of negligent misstatement. The two key cases in this area are Murphy v Brentwood District Council and Hedley Byrne v Heller.

Chapter

Cover Koffman, Macdonald & Atkins' Law of Contract

13. Misrepresentation  

This chapter looks at misrepresentation. It first identifies the requirements for a misrepresentation, and highlights the situations in which the courts are willing to find misrepresentations although prima facie there are only statements of opinion which are stated not to suffice in themselves. It considers the remedy of rescission, and when it will be barred. It looks at the different ways in which damages may be provided for misrepresentation: for fraudulent misrepresentation under the tort of deceit; for negligent misrepresentation under the tort of negligent misrepresentation; and for negligent misrepresentation under s2(1) of the Misrepresentation Act 1967. It looks at the different requirements for each type, which it will be advisable to use, and what will be covered by a damages remedy for misrepresentation. Consideration is also given to remedies for aggressive and misleading trade practices under the amended Consumer Protection from Unfair Trading Regulations.