Tort

Statutory

Contractual

A civil legal wrong against another for which the courts often assess monetary damages against the wrongdoer.  It is imposed by common law, that is, law that has been developed through the application of court case decision over time.

• Negligence
• Intentional Torts
• Strict Liability
• Absolute Liability

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Negligence

Failur to act as a resonable person would under the same or similar circumstances.  

Four Elements required:

1. Duty owed by negligent party to another party
2. Breach of that Duty
3. An actual injury or loss must occur
4. A close cause and effect (proximate cause) relationship between the breach of that duty and the injury or loss 

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Intentional Tort

Voluntary act that can result in inury or loss to another party, and the person committing the act can be held legally liable for that injury or loss.

Examples: Libel, Slander, Wrongful entry or wrongful eviction, Assault and/or battery, Wrongful detention, False arrest, Copyright/trademark infringement, etc.

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Strict Liability

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Absolute Liability

Applies when conditions or activities are dangerous by their very nature and are allowed to exist, even when the insured has taken every precaution to prevent or reduce any type of loss.  All that has to be proved is that an injury or damages occur because of the conditions or activities

ex: dangerous animals, hazardous material ops

An agreement between two or more parties, which creates an obligation to do or not to do a particular thing.

• Assumption of liability
• Breach of contract

Two actions that trigger 

Tort Liability

Direct Liability - results from your client's conduct

Vicarious Liability - results from the conduct of others

Results from a conduct of a business that is responsible for injury or property damage to another

ex: Market fails to clean up a food spill in the aisle, patron slips and falls and breaks several bones.  Claimant sues market because it directly caused the injury

Liability of one party based upon the liability of another. Liability is imputed (transferred from one party to another)

ex: while delivering groceries, an employee of market causes an auto accident injuring three people.  Injured parties bring a claim against the employee who directly caused the accident but they also bring a claim against market because market can be held vicariousliable for the action of its employees done within the scope of employment.

Compensatory Damages

Punitive or Exemplary Damages

sums of money that will compensate for the loss

1. Special Damages - specific dollar amounts that cover specific costs.  ex: medical bills, lost income, repair or replacement of property
2. General Damages - Subjective dollar amount that cover intangible losses ex: pain and suffering, loss of consortium

Premises

Operations

Products

Completed Operations

Ownership, Maintenance, Use of Autos

Ownership, Maintenance, Use of other conveyances

Employing Workers

Liquor

Environmental Impairment

Professional Activity

Bailee Liability

Legal liability results when injury and/or damages arises out of business activities (such as construction, processing, manufacturing, repairing, or loading and unloading goods, etc) which are necessary and incidental for conducting business. The exposure can be at the premises or at other locations where the business activity occurs.

ex: tree-removal contractor cause damage to power lines when removing tree limbs, during loading, a boxes fall off conveyer belt and injure a customer

Legal liability results when injury and/or damage arises out of defects in product design, manufacture, or the failure to warn or explain. The exposure applies to the use of a product made or sold by the business. This exposure begins after the sale and as soon as the product has left the premises.

ex: table collapses because improperly sized screws were used in construction, causing damage to customers computer, manufacturer fails to warn of choking danger associated with small parts on a toy and a child chokes on a part 

Legal liability results when injury and/or damage arises out of defective or improper workmanship. The exposure applies to the insured's work. This exposure begins once the operations have been completed and the insured leaves the work site.

ex: several weeks after an electrician uses the wrong size wire, a resulting fire damages the customer's building

Legal liability results when injury and/or damage arises out of the ownership, maintenance, or use of an auto, including entrustment and/or supervision. Almost every commercial client has this exposure.

ex: while making deliveries in a company auto, employee runs a red light and causes accident, poor maintenance program cause the improper braking ability of a company vehicle which results in an accident

Legal liability results when injury and/or damage arises out of the ownership, operation, maintenance, or use of conveyances other than an auto. The exposure will vary from business to business.

ex:Injury or damage is cause by use of mobile equipment such as a forklift, use of watercraft, aircraft, or recreational vehicles causes harm or injury

Legal liability arises from the statutory obligations employers have to employees regarding work-related injuries or occupational disease. This liability may also cover various consequential injuries to others, caused by the employee's injury or disease. The exposure is subject to the laws and regulations governing Workers Compensation, Employers Liability Coverage, and other employment related issues in each state.

ex: An employee ruptures a disc while lifting a box of paper, employee develops chemical pneumonia from inhaling acidic fumes while cleaning machinery

Legal liability is imposed in most states when injury and/or damage arises from the business of manufacturing, distributing, selling, serving, or furnishing of alcoholic beverages. The exposure will vary and is subject to statutes and case law in each state.

ex: An employee becomes intoxicated at a company-sponsored picnic, where the company provided alcoholic beverages, and injures someone while driving home, bar customer becomes intoxicated after consuming alcoholic beverages and injures someone while driving home

Legal liability may be imposed by statute or because of injury and/or damage. The exposure may arise from direct or indirect involvement with pollution and/or pollution-related situations

ex: Your negligent operation of a vehicle results in an accident, causing hazardous chemicals to leak from the other vehicle, gasoline to leak from the gas tank of your vehicle, and your cargo of toxic waste to be spilled, Your own commercial property contains leaking underground chemical tanks or lead-based paint

Legal liability results from injury and/or damage arising from the giving or failure to give professional advice or service. The exposure will vary depending on the nature of the business and by state statute and case law. 

ex: A CPA gives the wrong advice, resulting in IRS penalties and/or fines, An architect makes a design mistake, causing a load-bearing wall to collapse