Tort: Liability would be unduly and would indefinitely extend by the enlargement of the zone of duty. Public Policy: it would deter companies in contracting with local governments BUT it places immunities on private corporations. **K between two parties has in view to benefit to a third party, that is incidental rather than immediate. So the benefit must be one that is primary rather than incidental** Food Pageant v. Consolidated Edison : Has to be part of the contract in order to sue. Liability for blackouts : Conboy v. Mogeloff: (NL) Õ was advised by dr. D that Õ was okay driving and fell asleep on car, Õ’s kids were injured and Õ sued to recover for her kids injuries. Rule: D owned no duty to Õ ’s children. To attain actual privity court said that : Conduct on the part of D that links D to Õ which evinces D ’s understanding of Õ ’s reliance. In these allegations, Õ’s kids had no reliance on dr. D BiaKanaja v. Irving: (L) D was a notary and neglected to have witness when Õ ‘s decedent signed will à will invalid. No privity of K, no special relationshipà use these factors: Extent to which the transaction was intended to affect P Foreseeability of the harm Degree of certainty that Õ suffered injury Closeness of the connection betweenD’s conduct and the injury suffered Moral blame in D’s conduct
Rule: D ‘s negligence affected 3 rd party. Even if D not on contract with the 3 rd party, D was involved . Ultramares v. Touche : (NL) D negligently failed to discover that contracting party was insolvent therefore Õ loaned money to Contracting party. Rule: D owned no duty to Õ . Public policy argument that if D were to be held liable, it would open liability to an indeterminate amount for an indeterminate class. If there has been neither reckless misstatement nor insincere profession of an opinion, but only honest blunder, the ensuing liability for negligence is one that is bounded by the contract, and is to be enforced between the parties by whom the contract has been made. PURE ECONOMIC LOSSES no recovery for pure economic losses and no physical injury. ( SUPREME COURT CASE) Robins Dry Dock v. Flint : (NL) boat service delayed and Õ sued for loss of $$ on days that it was delayed. Rule: Õ who suffers no physical injury generally cannot recover for pure economic losses caused by D ’s negligence (includes free standing acts of negligence not committed in the course of performing the K) [ this combines the privity aspect] Exception to general rule with fishermen: Carbone v. Ursich : (L)Õ’s boat got fouled by the negligence of another boat and had to be taken to repair. Special Rule: D liable for damages done by fishing vessel but for the losses of fishermen “seamen are the favorites of admiralty and their economic interests entitles to the fullest possible legal protection. *fishermen interests have full legal protection* Contradicts case above: Henderson v. Arundel: (NL) Õ’s boat collided in a harbor and sued D for damages to boat.
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