Law and Business Administration in Canada Canadian 14th Edition By Smyth - Test Bank

Law and Business Administration in Canada Canadian 14th Edition By Smyth – Test Bank

 

Instant Download – Complete Test Bank With Answers

 

 

Sample Questions Are Posted Below

 

1) The duties of professionals may be categorized as

1. fiduciary, duty in tort, and duty to employees.
2. contractual, duty to employees, and duty in tort.
3. duty in tort, business duty, and contractual duty.
4. general duty, contractual duty, and duty in tort.
5. contractual, fiduciary and duty in tort.

 

Answer: e

Diff: 1

Type: MC

Topic: Liability of Professionals

Skill: Recall

 

2) The difference between a negligent misrepresentation and a fraudulent misrepresentation is that

1. a fraudulent misrepresentation requires only a breach of duty of care and skill, while a negligent misrepresentation requires at least some guilty knowledge or willful disregard of the falsity of information provided.
2. a negligent misrepresentation requires only a breach of duty of care and skill, while a fraudulent misrepresentation requires at least some guilty knowledge or willful disregard of the falsity of information provided.
3. there is no practical difference between a fraudulent misrepresentation and a negligent misrepresentation
4. a fraudulent misrepresentation does not require guilty knowledge or willful disregard of the falsity of information provided, while a negligent misrepresentation does.
5. a negligent misrepresentation does not require a breach of duty of care and skill, while a fraudulent misrepresentation does.

 

Answer: b

Diff: 3

Type: MC

Topic: Tort Liability for Inaccurate Statements

Skill: Recall/Applied

 

3) A conflict of interest can be said to arise

1. where a professional represents two or more parties, each of whom has an opposing interest.
2. when a client’s interest conflicts with the interest of another person represented by the same professional.
3. where a client’s interest conflicts with the interest of the professional representing the client.
4. where a professional represents two parties, each of whom has a competing interest.
5. all of the above

 

Answer: e

Diff: 3

Type: MC

Topic: Liability of Professionals

Skill: Recall/Applied

 

4) In a lawsuit against a professional for a breach of duty of care, a prudent plaintiff should

1. sue in contract for breach of contract for failure to properly perform services.
2. sue in tort for breach of fiduciary duty.
3. sue in tort for negligence arising from a breach of duty of care.
4. sue in tort for negligence arising from a breach of duty of care and in contract for breach of contract for failure to properly perform services.
5. sue in contract for negligence arising from a breach of duty of care and sue for breach of fiduciary duty.

 

Answer: d

Diff: 3

Type: MC

Topic: Liability of Professionals

Skill: Recall/Applied

 

5) Alice Walters is a patient of Dr. John Good, a heart surgeon. Dr. Good had just begun to tell Alice that her treatment wasn’t working and that she would need to have surgery to correct a defect in her heart, but then he was called away on an emergency and forgot to return to his conversation with Alice and explain all of the risks of the surgery to her. In fact, Dr. Good had diagnosed Alice’s condition three years ago after returning to work from his office Christmas party. He had had a number of alcoholic beverages, and this caused him to misinterpret a lump on her lung for a lump on her heart. After diagnosing Alice, Dr. Good had told Alice that the problem was with her heart and then prescribed treatment for it. Relying on what Dr. Good had told her, Alice had accepted the treatment, which was very painful. In this situation, it can be said that

1. Dr. Good made a negligent misrepresentation about the nature of Alice’s problem and the treatment for it.
2. Dr. Good was negligent in his diagnosis.
3. Dr. Good failed to obtain from Alice an informed consent.
4. Dr. Good committed a breach of contract in misdiagnosing Alice’s condition.
5. all of the above

 

Answer: e

Diff: 3

Type: MC

Topic: Tort Liability for Inaccurate Statements

Skill: Applied

 

6) Use this fact situation to answer the related questions that follow.

Henry Jones is the sole shareholder of Happy Go Lucky Company (HGLC). Henry, needing a loan from his bank, went to his accountant, Bob Wallice, and asked him to prepare a financial statement of the company that Henry could give to the bank to get the loan. Unfortunately, Mr. Wallice included certain property that did not belong to the company, which increased its value. When Henry took the financial statement to the bank, the bank caught the error, but made Henry guarantee the loan. The bank then told Mr. Wallice, who forgot to correct the error in the financial statement. A few days later, Henry decided he needed to invest more money in his company and began negotiations with a business associate, Carol Hill. When Carol asked for the financial statement of the company, Henry told her she could get it from the bank or from his accountant. Carol decided to go to the bank, which gave her the financial statement with the error in it. Based on the financial statement, Carol invested $50 000.00 in the company, only to realize a month later the problem with the financial statement the bank had given to her.

 

In this situation,

1. Mr. Wallace owed a fiduciary duty to Carol.
2. the bank owed a fiduciary duty to Carol.
3. Mr. Wallace owed a fiduciary duty to Harry.
4. Mr. Wallace owed a fiduciary duty to the bank.
5. all of the above

 

Answer: e

Diff: 3

Type: MC

Topic: Liability of Professionals

Skill: Applied

 

7) Use the fact situation in Q6 to answer the related question that follows.

In this situation, the preparation of the financial statement by Mr. Wallice, the accountant, constituted

1. negligent misrepresentation only.
2. breach of contract only.
3. negligence only.
4. negligence, breach of contract and negligent misrepresentation.
5. only negligence and breach of contract.

 

Answer: d

Diff: 3

Type: MC

Topic: Tort Liability for Inaccurate Statements

Skill: Applied

 

8) Use the fact situation in Q6 to answer the related question that follows.

In this situation, the bank’s conduct in giving the erroneous financial statement to Carol constituted

1. a breach of contract only.
2. a negligent misrepresentation.
3. a fraudulent misrepresentation.
4. negligence only.
5. neither negligence, no breach of contract or negligent misrepresentation.

 

Answer: b

Diff: 3

Type: MC

Topic: Tort Liability for Inaccurate Statements

Skill: Applied

 

9) Use the fact situation in Q6 to answer the related question that follows.

In this situation Henry’s telling Carol to get the financial statement from the bank constitutes

1. a negligent misrepresentation.
2. an innocent misrepresentation.
3. negligence.
4. a breach of the duty to act in good faith.
5. none of the above

 

Answer: e

Diff: 3

Type: MC

Topic: Tort Liability for Inaccurate Statements

Skill: Applied

 

10) Use the fact situation in Q6 to answer the related question that follows.

In this situation, if the value of the company increases substantially so that Carol makes money on her investment,

1. Carol will still suffer damages, but will only have an action against the accountant.
2. Carol will still suffer damages, but will only have an action against Henry.
3. Carol will still suffer damages, but will only have an action against the bank.
4. Carol will still suffer damages and have an action against the accountant and the bank.
5. Carol has suffered no damages and has no action at all.

 

Answer: e

Diff: 1

Type: MC

Topic: Tort Liability for Inaccurate Statements

Skill: Applied

 

11) Where a professional undertakes a task that is beyond the usual skills of his or her profession,

1. the professional must still follow the recommended standard.
2. the professional must use the degree of skill and knowledge commensurate with the task undertaken.
3. the professional must follow a well-known practice.
4. the professional must follow all standards suggested as the proper standard.
5. the professional need not follow any standard.

 

Answer: b

Diff: 3

Type: MC

Topic: Liability of Professionals

Skill: Recall/Applied

 

12) A fiduciary duty exists between a professional and his or her client when

1. the professional lends money to the client.
2. the principle of equity imposes such a duty.
3. the client owes money to the fiduciary.
4. a special relationship of trust exists.
5. a contract exists between the professional and the client.

 

Answer: d

Diff: 1

Type: MC

Topic: Liability of Professionals

Skill: Recall

 

13) The contractual duty of a professional contains a promise

1. to perform the services with due care.
2. to accept payment rendered for services.
3. to work for the client.
4. to engage other agents in pursuance of the contract.
5. to submit invoices denominated in Canadian dollars only.

 

Answer: a

Diff: 1

Type: MC

Topic: Liability of Professionals

Skill: Recall

 

14) Negligent misrepresentation is

1. a defamatory statement.
2. a statement that is fraudulent.
3. a statement that is made by one party to another and induces the other person to engage in negligent acts.
4. a statement that insults another.
5. an incorrect statement that is made without due care for its accuracy.

 

Answer: e

Diff: 2

Type: MC

Topic: Tort Liability for Inaccurate Statements

Skill: Recall

 

15) A misrepresentation is

1. a false assertion of fact made without knowledge of its falsity, and with honest belief in its truth.
2. a false assertion of fact made with knowledge of its falsity, or without honest belief in its truth.
3. a false assertion of fact about another person that defames that person.
4. a statement of fact that was true when it was made, but later became false due to changes in circumstances.
5. a missed representation.

 

Answer: b

Diff: 1

Type: MC

Topic: Tort Liability for Inaccurate Statements

Skill: Recall

 

16) A lawyer who enters into a business transaction with a client and neglects to inform the client that his credit rating is poor may be found to be

1. in breach of the law that governs lawyers.
2. in breach of his or her duty to inform the client.
3. in breach of contract.
4. in breach of the common law.
5. in breach of his or her fiduciary duty.

 

Answer: e

Diff: 2

Type: MC

Topic: Liability of Professionals

Skill: Recall

 

17) James, one of the partners of James & Fiduciary Duty Co., the auditors of a major Canadian corporation (Canco), is one of the major shareholders of Canco. This situation could result in a

1. violation of the statute.
2. breach of duty.
3. conflict of interest.
4. fiduciary duty.
5. breach of contract.

 

Answer: c

Diff: 1

Type: MC

Topic: Liability of Professionals

Skill: Recall

 

18) Which of the following is true?

1. The ordinary standard of care for ordinary negligence, is appropriate when judging the work of a professional.
2. Complying with normal professional standards is always an adequate defence.
3. Causation in professional–client relationships is not based on reliance.
4. A professional who exhibits the degree of skill and knowledge that is commensurate with a particular task will be held to have met the required standard even if the advice given is wrong.
5. The duty to take reasonable care does not include omissions.

 

Answer: d

Diff: 2

Type: MC

Topic: Liability of Professionals

Skill: Recall/Applied

 

19) The Hedley Byrne case establishes the principle of liability to ________ for ________.

1. third parties; negligence misrepresentation
2. clients; breach of fiduciary duty
3. third parties; tort
4. friends and relatives; negligence
5. clients; breach of contract

 

Answer: a

Diff: 2

Type: MC

Topic: Tort Liability for Inaccurate Statements

Skill: Recall

 

20) A lawyer who enters into a contact to purchase his or her client’s summer cottage has

1. lots of money.
2. committed a breach of contract.
3. a conflict of interest.
4. a duty not to bargain with the client for the best price.
5. lots of time on her or his hands.

 

Answer: c

Diff: 2

Type: MC

Topic: Liability of Professionals

Skill: Recall/Applied

 

21) A multi-disciplinary partnership is

1. a partnership between two or more persons who belong to different professions.
2. a partnership between two or more persons who belong to the same profession.
3. a partnership of persons in the same profession who have different specializations.
4. a limited partnership.
5. a partnership whose members have been disciplined for misconduct.

 

Answer: a

Diff: 1

Type: MC

Topic: The Role of Professional Organizations

Skill: Recall

 

22) Damages for breach of fiduciary duty is restitutionary in that

1. the breach is not a tort.
2. the breach is not a breach of contract.
3. the client may be contributorily negligent.
4. the client is entitled to be placed in the position he or she would have been had the breach not occurred.
5. the professional is required to give back what she or he has taken from the client.

 

Answer: d

Diff: 2

Type: MC

Topic: Liability of Professionals

Skill: Applied

 

23) A professional is

1. a person who is licensed by various levels of government.
2. a person who has a special accreditation or degree from a professional organization.
3. a person who belongs to a special club.
4. someone who sets him- or herself out to help the public.
5. someone who has specialized knowledge and skill on which a client relies and for which a client is prepared to pay.

 

Answer: e

Diff: 2

Type: MC

Topic: Professional Liability: The Legal Challenges

Skill: Applied

 

24) A disclaimer is

1. a statement made by one person to the effect that the person making the statement will assume liability for loss up a certain specified limit.
2. a statement to the effect that the person making it does not assume any responsibility for an action.
3. an exclamation.
4. a statement made in a soft voice or tone.
5. a statement in a claim of a client against a professional to the effect that the client seeks to claim damages for specified breaches.

 

Answer: b

Diff: 1

Type: MC

Topic: Liability of Professionals

Skill: Applied

 

25) The greater exposure of professionals to liability for professional negligence has led to the extensive use of

1. private investigators.
2. acceleration clauses.
3. liability insurance.
4. disclaimer clauses.
5. professional fees.

 

Answer: c

Diff: 1

Type: MC

Topic: Professional Liability: The Legal Challenges

Skill: Recall

 

26) Which of the following is NOT true?

1. A fiduciary duty exists when there is an existing contract between the professional and the client.
2. The principles for determining damages for breach of contract and breach of fiduciary duty are not necessarily the same.
3. A fiduciary duty requires that a professional avoid situations that give rise to a conflict of interest.
4. The existence of a fiduciary duty means that a lawyer cannot, as a general rule, act for a purchaser and vendor at the same time.
5. A fiduciary duty requires complete fidelity and loyalty to the other party.

 

Answer: a

Diff: 2

Type: MC

Topic: Liability of Professionals

Skill: Applied

 

27) A duty to account is

1. the duty of the court to examine the accounts of a professional who is accused of having misappropriated funds.
2. the duty of a professional to submit timely and accurate bills to the client for payment.
3. the duty owed by a person who commits a breach of trust to hand over profits made as a result of the breach.
4. the duty of a client to pay bills that are rendered by the professional.
5. the duty of the professional to maintain accurate accounts of the invoices submitted to his or her client.

 

Answer: c

Diff: 1

Type: MC

Topic: Liability of Professionals

Skill: Recall/Applied

 

28) Brayden had a long history of intestinal disorder. After several failed non-invasive treatments, it was suggested to him that he undergo a colonoscopy as a means of better diagnosing his problem.  He spent five minutes prior to the procedure consulting with the doctor who performed the colonoscopy.  He was told by the doctor that these procedures usually are simple and for the most part problem-free.  Brayden agreed to undergo the procedure.  During the course of the colonoscopy his bowel was perforated and he was required to undergo a significant open surgical procedure to save his life.  Brayden sued the doctor for lack of informed consent.  At trial, the expert evidence established that the risks of bowel perforation were material risks and as such ought to have been disclosed.  Brayden in fact testified that had he been told of the risk of bowel perforation he would have not undergone the colonoscopy.  However, the judge hearing the case made a finding that a reasonable person with Brayden’s condition having been properly informed of all the risks would have undergone the colonoscopy.  In these circumstances, the judge will likely then proceed to

1. allow the action because of lack of informed consent.
2. allow the action because of the fact that Brayden himself testified he would not have undergone the procedure had he been told of the risks of bowel perforation.
3. dismiss the action because a reasonable person in the position of the plaintiff would have proceeded with the colonoscopy had they been informed of the materials risks.
4. dismiss the action because there is no causation.
5. allow the action because Brayden had to undergo an unexpected and unanticipated life-saving surgery.

 

Answer: c

Diff: 3

Type: MC

Topic: Proving Negligent Misrepresentation

Skill: Applied

 

29) A fiduciary duty may exist in the absence of a contractual duty.

1. True

Correct: Correct

1. False

Incorrect: Incorrect

 

Answer: a

Diff: 1

Type: TF

Topic: Professional Liability: The Legal Challenges

Skill: Recall

 

30) Normal standards of care always apply to professionals who undertake a task beyond the usual skills of the profession.

1. True

Incorrect: Incorrect

1. False

Correct: Correct

 

Answer: b

Diff: 2

Type: TF

Topic: The Standard of Care for Professionals

Skill: Recall/Applied

 

31) The essence of causation in professional–client relationships is the suffering of harm or damage.

1. True

Incorrect: Incorrect

1. False

Correct: Correct

 

Answer: b

Diff: 2

Type: TF

Topic: Causation

Skill: Recall/Applied

 

32) Generally speaking, all professional organizations have a number of the same responsibilities.

1. True

Correct: Correct

1. False

Incorrect: Incorrect

 

Answer: a

Diff: 1

Type: TF

Topic: The Role of Professional Organizations

Skill: Recall

 

33) Like any other standard of care, the standard of care for professionals evolves and changes as the law evolves and changes.

1. True

Correct: Correct

1. False

Incorrect: Incorrect

 

Answer: a

Diff: 1

Type: TF

Topic: The Standard of Care for Professionals

Skill: Recall/Applied

 

34) Where two professionals have specialized knowledge and skill in the same profession, representation of one by the other negates the usual standard of care for the professional who is representing the other.

1. True

Incorrect: Incorrect

1. False

Correct: Correct

 

Answer: b

Diff: 2

Type: TF

Topic: Liability of Professionals

Skill: Applied

 

35) Liability for breach of a fiduciary duty may arise even where there has been no negligence.

1. True

Correct: Correct

1. False

Incorrect: Incorrect

 

Answer: a

Diff: 1

Type: TF

Topic: Liability of Professionals

Skill: Recall

 

36) A professional may owe a duty of care in tort to someone other than the client.

1. True

Correct: Correct

1. False

Incorrect: Incorrect

 

Answer: a

Diff: 1

Type: TF

Topic: Tort Liability for Inaccurate Statements

Skill: Recall

 

37) If the plaintiff has suffered no damages, a defendant who has breached a fiduciary duty will not be held liable.

1. True

Incorrect: Incorrect

1. False

Correct: Correct

 

Answer: b

Diff: 2

Type: TF

Topic: Liability of Professionals

Skill: Recall

 

38) The duty of a professional to take reasonable care does not include a duty not to omit essential matters.

1. True

Incorrect: Incorrect

1. False

Correct: Correct

 

Answer: b

Diff: 1

Type: TF

Topic: Liability of Professionals

Skill: Recall

 

39) If a client sues a professional for failing to exercise reasonable care in giving advice, but the client has suffered no damage as a result, the professional will not be liable.

1. True

Correct: Correct

1. False

Incorrect: Incorrect

 

Answer: a

Diff: 2

Type: TF

Topic: Liability of Professionals

Skill: Recall

 

40) Damages for breach of contract and breach of fiduciary duty are based on the same principle.

1. True

Correct: Correct

1. False

Incorrect: Incorrect

 

Answer: a

Diff: 2

Type: TF

Topic: Liability of Professionals

Skill: Recall/Applied

 

41) What is deceit?

 

Answer:

Deceit is the intentional making of a false statement with the intention of misleading another person.

 

Diff: 1

Type: ES

Topic: Other Torts

Skill: Recall

 

42) Deciding on the type of action to bring for acts or omissions of a professional who breached a duty of care was not always easy, but this has changed. Explain.

 

Answer:

At one time considerations such as the date the cause of action arose and the nature of damages that might be awarded were factors in deciding whether to sue in contract or in tort. However, today this is overcome by suing in both contract and tort.

 

Diff: 1

Type: ES

Topic: Liability of Professionals

Skill: Applied

 

43) Which is easier to prove, fraudulent or negligent misrepresentation? Why?

 

Answer:

Fraudulent misrepresentation requires proving at least some guilty knowledge or willful disregard for the falsity of the information provided, and this may therefore be somewhat difficult to prove, while negligent misrepresentation requires only a breach of duty of care and skill, making it easier to prove.

 

Diff: 3

Type: ES

Topic: Tort Liability for Inaccurate Statements

Skill: Applied

 

44) Causation is the third condition that must be proven to sustain an action for tort liability. Explain.

 

Answer:

There are three conditions that must be proven to sustain a finding of tort liability: that the defendant owed a duty to the injured party, that the defendant breached this duty, and that the breach of that duty caused the injury. It is the last of these conditions that causation deals with. In this context, the question to be asked is whether the injured party relied and acted on the advice of the professional to his or her detriment. If the answer is yes, then the three conditions have been met and liability will follow.

 

Diff: 2

Type: ES

Topic: Causation

Skill: Recall/Applied

 

45) What is a multi-disciplinary partnership?

 

Answer:

A multi-disciplinary partnership is one in which partners of one profession practice together with members of other professions, for example, lawyers practicing together with chartered accountants.

 

Diff: 1

Type: ES

Topic: Multi-disciplinary Partnerships

Skill: Recall

 

46) What is a fiduciary duty?

 

Answer:

A fiduciary duty is a duty that is imposed on a person who stands in a special relationship of trust to another.

 

Diff: 1

Type: ES

Topic: Liability of Professionals

Skill: Recall

 

47) What is a conflict of interest?

 

Answer:

A conflict of interest is a situation where a person’s duty conflicts with his or her interests, for example, where a person owes a duty to two or more persons with competing interests. His or her interest in making money by representing both persons will conflict with his or her separate duty of loyalty to each of them.

 

Diff: 1

Type: ES

Topic: Liability of Professionals

Skill: Recall

 

48) Explain what is meant by the “duty to account” of a professional who has committed a breach of trust.

 

Answer:

Professionals or other persons in fiduciary relationships are prohibited from making secret profits as a result of breaching their fiduciary duty. Where such a professional or person makes a secret profit or profits from her or his position as a fiduciary, she or he will owe a duty to account or hand over all the profits she or he made as a result of the breach.

 

Diff: 2

Type: ES

Topic: Liability of Professionals

Skill: Recall/Applied

 

49) What is the difference between negligent misrepresentation and fraudulent misrepresentation?

 

Answer:

A negligent misrepresentation is an incorrect statement that is made without due care for its accuracy. A fraudulent misrepresentation is an incorrect statement made knowingly with the intention of causing injury to the other person.

 

Diff: 2

Type: ES

Topic: Tort Liability for Inaccurate Statements

Skill: Recall/Applied

 

50) What is a fiduciary duty?

 

Answer:

A fiduciary duty is a duty that is imposed on a person by virtue of a special relationship between the fiduciary and some other person.

 

Diff: 1

Type: ES

Topic: Liability of Professionals

Skill: Recall

 

51) A professional must not place him or herself in a position where his or her interest and duty conflict. Explain.

 

Answer:

A professional person is usually said to have a fiduciary obligation towards his or her clients. He or she is a fiduciary. A fiduciary is a person who has a special relationship of trust with another. The fiduciary is usually someone in a more powerful position vis-à-vis the other party. The nature of this power relationship imposes an obligation of utmost trust on the part of the fiduciary. That is, the fiduciary must be completely loyal to the other party. One of the consequences of this obligation is the duty of the fiduciary or professional not to place himself in a position that will give rise to a conflict of interest. That is a position where his or her interest will conflict with his or her duty. Thus, a professional will usually not be expected to act on behalf of two persons who have competing interests because the professional will find it hard to fulfill his or her duty to both parties.

 

Diff: 3

Type: ES

Topic: Liability of Professionals

Skill: Applied

 

52) Although the law has long recognized some professional relationships as inherently fiduciary (such as lawyer–client and doctor–patient), not every professional relationship will be fiduciary in nature. Explain.

 

Answer:

Many types of relationships involving professionals may not necessarily be fiduciary in nature. It will depend on the particular facts of the case. In order to establish a fiduciary relationship, five factors must be considered carefully: the vulnerability of the client; whether the relationship involved trust of the professional; whether the client relied (to the client’s detriment) on the advice/expertise of the professional; whether the professional had any discretion to do what was done; and whether there are specific standards for the professional expressed in a code of conduct. Only if the majority of these factors are found to exist will the relationship be fiduciary in nature.

 

Diff: 3

Type: ES

Topic: Liability of Professionals

Skill: Recall/Applied

 

53) Damages for breach of fiduciary duty and breach of contract are based on the same principle. Explain.

 

Answer:

In both breach of contract and breach of fiduciary duty, damages are intended to be restitutionary. In both situations, damages are intended to place the party in the place he or she would have been in had the breach not occurred. The characterization of a claim as a breach of fiduciary duty will not entitle a plaintiff to a higher award.

 

Diff: 3

Type: ES

Topic: Liability of Professionals

Skill: Applied

 

54) Professionals may have liability to their clients in tort and contract, and for breach of fiduciary duty. Briefly explain the basis for liability in these categories.

 

Answer:

Professionals may be liable for torts committed against clients and for breach of contract. In general, any agreement to perform services for a client contains an agreement that the professional will perform the service with due care. Where the professional does not perform the service with due care, there is breach of contract and the client may sue for damages. In addition to this, a breach of contract will also occur where the professional fails to perform the service, or performs unsatisfactorily. Clients will also have a claim in tort under a variety of circumstances. These include negligence and negligent misstatements. A professional person also has a fiduciary duty. One of the consequences of this obligation is the duty of the fiduciary or professional not to place herself or himself in a position that will give rise to a conflict of interest—that is, a position where his or her interest will conflict with his or her duty. Thus, a professional will usually not be expected to act on behalf of two persons who have competing interests because the professional will find it hard to fulfill his or her duty to both parties.

 

Diff: 3

Type: ES

Topic: Liability of Professionals

Skill: Applied

 

55) What are professional bodies? Explain the role of professional bodies.

 

Answer:

Professional organizations are autonomous organizations established under provincial statutes for the purposes of determining and policing standards of compliance and behaviour among members of the profession. Professional organizations will usually have governing bodies that set rules and regulations for members. Some of the responsibilities assumed by professional bodies include (a) establishing educational and entrance for entry into the profession, (b) setting and adjusting standards of ethical conduct, (c) hearing complaints against members of the profession and (d) defending the profession against attacks that it considers unfair.

 

Diff: 1

Type: ES

Topic: Professional Liability: The Legal Challenges

Skill: Applied

 

56) In a lawsuit alleging negligent misrepresentation the plaintiff must establish more than a breach of duty causing loss. Identify the five requirements for proving negligent misrepresentation as set by the Supreme Court of Canada.

 

Answer:

The five requirements for proving negligent misrepresentation are:

1. There must be a duty of care based on a “special” relationship between the representor and the representee.
2. The representation in question must be untrue, inaccurate, or misleading.
3. The representor must have acted negligently in making a representation—that is, he or she must have fallen below the requisite standard of care required of a professional making such a representation.
4. The representee must have relied, in a reasonable manner, on the negligent misrepresentation.
5. The reliance must have been detrimental to the representee in the sense that damages resulted.

 

Diff: 3

Type: ES

Topic: Proving Negligent Misrepresentation

Skill: Recall/Applied