Purchase of Land in the Outback, in New South Wales - Essay Example

25 July First Problem Briefly stating the facts, Rhett, a land developer was interested in purchasing a land in the Outback, in New South Wales. Before purchasing the land from Melanie, he wanted to conduct a background check on the piece of land he was buying. Therefore, he asked for a certificate of clearance from the Outback Council, stating that the land was never inundated by floods. The Council clerk made a mistake in checking the records, which actually showed that the particular land in question had actually been flooded on previous occasions, and instead gave an all-clear certificate. Based on this certificate, Rhett purchased the land. Later on when Rhett submitted his plans for construction of a residential subdivision, the Council rejected the proposal, on account of flood risk. Due to the refusal, and no other recourse left with Rhett, he had to sell his land to a local farmer at a substantial loss. Now from the facts above, it is quite clear that, there was injustice meted out to Rhett. Now, the problem that Rhett is facing has a solution in Law of Torts. Law of Torts is the field of law which deals civil harms that may be caused to a person. The concept of negligence is integral to the Law of Torts. The definition of negligence under tort law states that, “the breach of a legal duty to take care, resulting in damage to the claimant which was not desired by the defendant” [L.B. Curzon, Dictionary of Law]. Another popular definition states that, “Negligence is the omission to do something which a reasonable man, guided upon those considerations which ordinarily regulate the conduct of human affairs, would do, or doing something which a prudent and reasonable man would not do.” [Per Alderson B., Blyth v Birmingham Waterworks Co. (1856)]. From Lord Curzon’s definition, we understand that there are three important aspects to prove negligence, one being ‘legal duty to take care’, ‘breach of duty of care’ and the third one being ‘damages’. We will first understand the three ingredients of negligence, and then go on to observe whether the problem at hand actually amounts to negligence, and if so, what the recourse that Rhett has is in this given scenario. Now the duty of care essentially means that, every person owes a duty not to harm their neighbour, and reasonably foresee, whether there action may cause to the person. This principle was laid down in the landmark judgement of Donahue v Stevenson. Further in Capro v. Dickman, their primary components of Duty of Care were laid down. The judgement said that Harm must be (1) reasonably foreseeable (2) there must be a relationship of proximity between the plaintiff and defendant and (3) it must be 'fair, just and reasonable' to impose liability. Now as goes for the ‘first component’, we have to determine whether the Council clerk could reasonably foresee the harm he was about to cause Rhett. In this scenario, it can be reasonably assumed that the clerk knew that the whole and sole responsibility of running the background check on the said property was on him. He was also aware that, if there was any irregularity in the records, it was his duty to point out the Scarlette. Failure to do so, would result in great harm to the buyer of the land, as the buyer was solely depending upon the background check of the Council. Therefore, it is reasonable to assume that, the clerk was in a position to ascertain the kind of harm he would cause if he did not take the proper steps to give the proper background check on the aforesaid land. So we are sure, that the first ground of Duty of Care exists. Moving on to the ‘second component’, i.e. the relationship of proximity between the plaintiff and the defendant. There was a definite relationship between Rhett and the Council clerk. Rhett had approached the Council clerk, to provide him with the background check on the said land. Therefore, Rhett was expecting the clerk to carry out his duties rightfully and perform the check for him. It was the clerk’s duty to check the said land’s past history, and inform Rhett about the Scarlette. Therefore, we see there was a clear legal relation between Rhett and the clerk, where clerk was to perform his official duty on Rhett’s request. The ‘third component’, i.e. it must be just and fair to impose the liability. In this case we see that it was the official duty of the Council clerk to provide Rhett with the background check upon his request. Moreover, the Council was established in the first place to regulate, the lands in the Outback, and clerk was hired to provide the service of background checks and inspection of records to warn the prospective buyers of any land. Therefore, it is just and fair to conclude that if there was negligence in the manner in which the clerk carried out his duties and that directly led to the loss that Rhett suffered subsequently. Therefore the clerk should be held liable to for not performing his duties, and being negligent. Further, more we must also look into the second aspect of negligence, as laid down by Capro v. Dickman, i.e. breach of duty of care. As we have seen clearly from the above explanation, that there exists a ‘duty of care’ on the part of the clerk. Clearly the clerk in this case, by not taking care to look into the records carefully, and thus giving wrong information to Rhett, the clerk has breached his duty of care. So, it’s safe to assume that there was negligence on the part of the Council clerk, because the clerk was negligent was search for the records and this directly caused the harm at hand. This brings us to the third aspect of negligence, i.e. damages. Now a important aspect of understanding whether there was negligence on the part of the Council clerk is to understand whether there was any mental or tangible harm caused to Rhett. In this scenario, the negligent act of the clerk, led to the purchase of the said land by Rhett. Furthermore, when the land was declared unfit for construction then, Rhett had to sell the land at a really low price, which led the cause a substantial loss to Rhett. This loss caused to Rhett, is the actual damage that Rhett. This sort of damage was not something that the clerk could not have foreseen. It is obvious, that the clerk was aware that his actions would lead Rhett to purchase the said land, and if there were to be any mistake on the part of the clerk, it would lead to the a lot of monetary loss to Rhett. Therefore, the defence of remoteness of damage cannot be taken in this particular case. The above analysis of the fact situation clearly shows that Rhett can claim damages from the Council, as the clerk was in the employment of the Council, and negligent act was done by the clerk in the course of his duty. This principle is covered under the master-servant relationship and the vicarious liability principle. Therefore, Rhett has a strong recourse against the clerk and the Outback Council. Second Problem Briefly stating the facts, Rhett had gone to a party, where he met Scarlett. Scarlett told him that she had heard from the outback council that, they were going to rezone large number of areas in the outskirts of the town for residential purpose. She also advised him to buy land in the outskirts of the town as soon as possible, as the land prices may go up after the Outback Council makes the official announcement of rezoning. Upon this advice Rhett purchases a land worth ?100,000 form Gerald. Later Rhett discovers that the land is populated and will be never be rezoned for residential purposes. The value of the property decreases to ?10, ooo only after the discovery of the pollution. Rhett confronted Scarlett and asked her about the false advice she had given him. To this, Scarlett says that she was mistaken about the relocation of the land. In the present scenario, Rhett has a two pronged remedy. Rhett can successfully claim damages against both Scarlett and Gerald. The remedy here available to Rhett is that of misrepresentation and fraud. Now, in order to understand the remedy, we must understand the nature of these two torts. To begin with, the nature of ‘misrepresentation’ was laid down in the landmark judgement of Stansfield v. Starkey [(1990) 220 Cal.App.3d 59]. The judgement said,(1) The defendant must have made a representation as to a past or existing material fact; (2) The representation must have been false; (3) The defendant must have known that the representation was false when made or must have made the representation recklessly without knowing whether it was true or false; (4) The defendant must have made the representation with an intent to defraud the plaintiff, that is, he she must have made the representation for the purpose of inducing the plaintiff to rely upon it and to act or to refrain from acting in reliance thereon; (5) The plaintiff must have been unaware of the falsity of the representation; must have acted in reliance upon the truth of the representation and must have been justified in relying upon the representation; (6) And, finally, as a result of the reliance upon the truth of the representation, the plaintiff must have sustained damage. Now reading into the principles of misrepresentation, we can clearly co relate as to how, Rhett has a claim over Scarlett. In the present case, the third ingredient of misrepresentation is applicable. It is clear from the facts, that Scarlett sated the fact about the outskirts of the town being rezoned, without knowing whether the statements were true or false, as she was herself was not relying on credible source. She admits that she had merely heard that the lands were to be rezoned. She based her statements on mere assumptions, which had no logical backing to them at all. Now reading into the fifth ingredient makes it clear that, a case for misrepresentation is clearly made out. In this case, Rhett had received the information from Scarlett, about the rezoned areas. Rhett made complete reliance on the false statements by Scarlett, and went ahead and purchased the lands from Gerald. So in essence, Rhett purchased the lands because he believed in what Scarlett had to say. Rhett was completely justified in relying upon the statements of Scarlett, as Scarlett had assured that the lands were in fact going to be rezoned in a matter of time, and had urged Rhett to go ahead and purchase the lands in question. So therefore, Rhett relied completely upon the information of Scarlett, and went ahead and purchased the land form Gerald. With regards to the sixth ingredient, there must be some harm or damage caused to the plaintiff, because of the reliance upon the misrepresented statements made by the defendant. In this particular case, Rhett had actually believed the statements made by Scarlett , and had purchased the lands on the outskirts of the outback. Rhett had paid a sum of ?100,000 for the land and because of the wrong information, had ended up losing a sum total of ?90,000. So therefore, there was a tangible damage cause to Rhett, monetary in nature, and therefore, Rhett has full rights to claim damages form Scarlett. Works Cited Alderson B., Blyth v Birmingham Waterworks Co. (1856) Stansfield v. Starkey [(1990) 220 Cal.App.3d 5   Read More