The first case, Mack has given certain advised in some shares to Ali and Lim

in a newly opened seafood restaurant. Mack is a stock broker and also a

professional, he given advice to Ali and Lim to buy Big Bank and World

Brothers Bank Bhd share had potential to rise 20%. Ali and Lim invested

RM200,000 with Mack the next day.

Unfortunately Mack’s advice did not work, the share has dive 60% on world

economic crisis and the two banks declared insolvent. Lim and Ali have lost

their investment. The question is to determine whether Lim and Ali had a

care on negligence against Mack.

In this case, it is advised that Lim and Ali may not succeed in suing Mack, a

stock broker for damages allegedly caused by the world economic crisis

based on the grounds of professional negligence. Lim and Ali would need to

prove:

(i) Duty of Care

(ii) Breach of Duty

(iii) Damages suffered as a result of the breach and not remote

The duty of care owed by a professional (e.g. a stock broker) to his clients is

stated in Lamphier v. Phipos that a professional undertakes to bring fair,

reasonable and competent degree of care and skill. Here, the negligence is

judged by the test of the ordinary skilled man exercising and professing to

have that special skill. He need not posses the highest expert skill.

For breach of duty and damages, Lim and Ali have to prove that there is a

breach and damages cause by the defendant is not remote by the breach of

duty.

In my opinion, the amount of RM 200,000 is not a small amount, so the

damages that caused by Ali is remote. Ali also realized that when he gave

the advice, Ali and Lim took it seriously and invested with him the next day.

In this situation, there is a trust between Mack and, Lim and Ali so there is a

breach of duty occurred.

In professional negligence the following additional elements also need to be

proven by Lim and Ali as laid down in:

(a) The negligence had been committed in the ordinary course of business

or professional affairs.

(b)One person must have sought information or advice from another. The

person need not necessarily be the professional’s client. The duty of

care includes giving of negligent information and statements (e.g. fail

in advic

(c) The person who gave the information or advice was not under a

contractual or fiduciary obligation to give the information or advice.

(d)The information or advice must have been given in circumstances in

which a reasonable man so asked would know that he was being

trusted or that his skill or judgment was being relied upon- Hedley

Byrne v. Heller.

(e) The person asked for this information or advice chose to give that

information or advice. There was no disclaimer or a clear qualification

which shows that the giver was not accepting responsibility.

The negligence had been committed in the ordinary course of business or

professional affairs. Even though, in the scene may look inappropriate to do

business, but Mack has the intention to continue his long conversation about

his market analysis that showed in the share market will rise and

recommended two counters namely, Big Bank Bhd and World Brothers

Bank Bhd’s share had potential to raise 20%. Besides that, he also went

along with Lim and Ali to invest the next day.

One person must have sought information or advice from another. The

person need not necessarily be the professional’s client. The duty of care

includes giving of negligent information and statements (e.g. fail in advice)

In the situation, Mack met his old friends, Lim and Ali in a newly open

seafood restaurant. They started out with a conversation on the market

economy which leads Mack recommend two counters to them. From here

there is an exist of Mack giving the advice to them and it turns out his advice

does not work. But in defences, Mack may say that Lim and Ali is not his

clients. As seen earlier, if a professional person provides information or a

client but recognized and intends that such information or advice is wrong

and negligently given, liability will result to the non-client for damage

therefore caused. So there is an existing of fail in advice, and negligent of

information.

The person who gave the information or advice was not under a contractual

or fiduciary obligation to give the information or advice. In this situation,

Lim and Ali met Mack in a seafood restaurant when they were having the

conversation.

The information or advice must have been given in circumstances in

which a reasonable man so asked would know that he was being trusted

or that his skill or judgment was being relied upon- Hedley Byrne v.

Heller. In this situation, Mack was awared that he was being trusted and

relied on. Though casual conversation may not be applied to Hedley

Byrne like the example case given Fish v. Kelly where a solicitor met a

friend in a train and casually gave him advice on a point of law, it was

held that the duty of care is not apply. But this situation is different, Lim

and Ali invested together with Mack. Which concludes that Mack has the

intention and know he was relied on that’s why he followed. Though in

defenses, Mack may say this is just a casual conversation. At the same

time, this also an impromptu opinion from Lim and Ali, they did not

even do any research on the market economy and straight away invested

with Mack the next day.

The person asked for this information or advice chose to give that

information or advice. There was no disclaimer or a clear qualification

which shows that the giver was not accepting responsibility. In this

situation, Mack was the one who chose to give that advice and there was

no clear disclaimer or clear qualification that he is not accepting the

responsibility. The market analysis is the clear evidence that showed that

he was really interested to have Lim and Ali into his business.

The cases on professional negligence include Manjit Singh s/o Gurdial

Singh v. R. K. Nathan, Neogh Soo Oh & Ors. v. G. Rethinasamy,and Bank

Bumiputra Malaysia Bhd. V. Yeoh Ho Huat.

Applying the case of Neogh Soo Oh & Ors. v. G. Rethinasamy, it is clear

that Mack, the defendant has failed in his duty to use reasonable care and

skill in giving his advice and taking such action as the facts of this

particular case demanded of a normally competent and careful

practitioner here. Apart from a research analysis about the share market,

like other normally stock broker should have also done a research on the

economy stability and any other factors that may affect the share market.

Therefore in my opinion, He was therefore liable to compensate his

clients for the loss caused by his breach of contractual duty as their stock

broker.

He was also liable in tort; quite independent of contract, as a professional

man professing special skill who gives assistance to another, and he owed

a duty of care to that person who to his knowledge relied on his skill. Lim

and Ali,’s reliance on the advice that Mack given as a professional stock

broker had resulted Lim and Ali lost RM200,000 in their investment.

The second case is on Negligence. As, Mack’s family were having

dinner, Mack’s daughter screamed as she found a dead lizard in her fried

rice. Mack complained to the manager and her daughter was sick for one

week. Mack was very unhappy with the incident and intend to sue the

newly open seafood restaurant. The question is whether Mack could be

succeeding in suing the newly open seafood restaurant.

Negligence is defined in Winfield and Jolowics on Tort as ‘the breach of

a legal duty to take care which results in damage, undesired by the

defendant to the plaintiff. Thus, the ingredients of negligence are:

1. A legal duty on the part of A towards B to exercise care in such

conduct of A falls within the scope of duty.

2. Breach of duty

3. Consequential damge to B.

Mack is advised to sue the newly opened seafood restaurant for

negligence, because he is most likely to succeed. This advice is supported

by the case of DONOGHUE v. STEVENSON [1932] A.C. 562. This

case law is used to prove the presence of duty of care.

That the case of DONOGHUE v. STEVENSON [1932] A.C. 562 clearly

established the tort of negligence in relation to Restaurant manager as

it set out the principle that a Restaurant manager did owe a duty to the

Mack’s Daugther.The said case is composed of specific facts upon which

the principle was founded.

The test for the existence of the duty owed by the plaintiff is the

neighbour principle stated by Lord Atkin in DONOGHUE v.

STEVENSON, i.e the foresight of the reasonable man. One therefore

asks the question whether the injury to the plaintiff was reasonably

foreseeable consequence of the defendant’s acts or omission.

In my opinion, as a newly open seafood restaurant, the manager should

have make sure its subordinates have kept the restaurant clean before it is

open to serve the customer. At the same time, they did not expect that a

girl would fall sick seeing a lizard on the fried rice. Although there was

no contractual duty between Mack’s daughter, the restaurang manager

owed her a duty of take care that the restaurant food and the environment

did not contain any noxious matter and he would be liable if that duty is

broken.

The defendant must not only owe the plaintiff a duty of care, he must be

in breach of it. The test deciding whether there has been a breach of duty

laid is down in the dictum of Alderson B. in Blyth v, Birmingham

Waterworks Co. This case law tells us that negligence is the omission to

do something which a reasonable man, guided upon those considerations

which ordinarily which a prudent and reasonable man would not do.

From here, the question is who is a reasonable man? A reasonable man

has been described as the “man on the omnibus”. In other words, a

‘reasonable man’ means an ordinary man who is expected to have any

particular skill such as that posseses by a surgeon, a lawyer or a plumber

unless he is expected to have one.

In this case, the restaurant manager is expected to have the responsibility

to take care of the restaurant and to make sure everything in order under

his care if not there would not be a title called “manager” .

But at the same time, the noxious matter is a lizard, which has legs and

can crawled wherever it wants to which may cause it unexpected to

ended up in a fried rice.

Which leads to the case on Roe v. Minister of health [1954] 2 .Q.B.66,

where leads to the question of foreseeability of an event will depend on

the particular item of knowledge is to be imputed on the reasonable man.

In my opinion, it is foreseeable if the newly restaurant is clean and well

managed. A lizard could not be death if it is crawled when the food was

ready to be serve but when it is cooking , yes it will be death. The

question is, how did the lizard get into the fried rice in the first place. To

me, the restaurant must be that dirty till the lizard can crawled through

the heat.

Therefore, Mack is advised that he can sue the restaurant and might get

recover damages from the restaurant.