Australian torts law, negligence

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Аustrаliаn Torts Law, Nеgligеnсе3

Аustrаliаn Torts Law, Nеgligеnсе

Case: Jane and Tom; Philip

Is there negligence conduct by either Phillip or Radio 2ZW?

The conduct of negligence occurs when a party fails to play its duty of taking precaution against the risk that might be encountered by another party (Blake v Galloway [2004] CA). It is failing to do what a reasonable person could do in the same circumstances. In the case of Liverpool Catholic Club Ltd v Moor [2014] NSWCA 394, the defendant failed to play his duty efficiently and the plaintiff suffered some major losses. It was identified that failure to show concern to another person despite having some knowledge that the act would cause damage, the person suffering needs to be protected
Donoghue v Stevenson [1932] AC 562, HL. In Negligence law, the breach of duty of care leading to damage does not have any defence. Moreover, if the plaintiff happens to rely on the wrong advice given by the defendant and end up suffering loss, the defendant needs to be held liable in a court of law.


In this case, Phillip an employee in Radio 2ZW leads a program of guiding listeners on the best companies to invest with. Jane and Tom, listeners of the program were interested in investing in shares. Jane stated the qualifications of the company that she wished to invest in and Phillip recommended Olivia and Grampian without doing further investigation about the price of shares in those companies and their performance in the market. Consequently, Jane and Tom purchased shared just to realise that the shares of those companies had fallen due to downturn in the stock market, thus not acquiring the profit they wished to have. Both Jane and Tom suffered harm because of relying on the advice given by Phillip concerning the suitability of the two companies in their interested investment conduct.


Therefore, Phillip is negligent for leading to damage to Jane and Tom through his act.

Could Jane and Tom take any legal action against either Phillip or Radio 2ZW?

In negligent law, the wrongdoer should be in a position of being protective to the plaintiff. As it was in the case of Liverpool Catholic Club Ltd v Moor [2014] NSWCA 394, the wrongdoer conducted ac act, which resulted to the plaintiff suffering some great damage. In this case, the plaintiff took a legal action against the wrongdoer, which was also identified in Rylands v Fletcher (1868) LR 3 HL 330.


Here, Jane and Tom are the plaintiffs since they suffered after investing by purchasing shares from the two companies, an advice e given by Phillip from Radio 2ZW. Jane and Phillip are entitled to taking a legal action and sue Phillip for failing to conduct a thorough investigation concerning the recommended companies before suggesting them to Jane, as Tom was listening to the show and got interested on the same. Jane and Tom relied on the advice given by Phillip from Radio 2ZW and bought their shares from the recommended companies without him telling them that there was a downturn in the stock market during that period. If Phillip had looked for efficient information concerning the share price of those companies in the market, he could not have misled the plaintiffs. Tom and Jane purchased shares during the inefficient period, which could have been prevented if Phillip informed them about the downturn in the stock market that was affecting the price of the two companies’ shares.


Actually, Jane and Tom should sue Phillip from Radio 2ZW for his negligence.

Are the elements of the legal action satisfied and are they likely to be successful?

In the negligence law, the wrongdoer should be protective to the plaintiff and because of being negligent, he/she should compensate the plaintiff accordingly. This applies in the case of Bolton v. Stone [1951] AC 850, [1951] 1 All ER 1078, whereby the plaintiff was compensated by the wrongdoer after suffering some damage. In negligence law, defence fails to apply if the defendant had knowledge of the likelihood of the occurrence of harm to the plaintiff resulting from his/ her actions (Air. Org, 2013, 1).


In this case, Jane and Tom invested in companies where the price of shares was low because of Phillip’s negligence. After taking the issue to a court of law, the interests of the plaintiffs need to be met. Phillip cannot defend himself in a court of law because he had run the program for a period and was aware of the likelihood of the occurrence of the downturn in the stock market, but failed to take his time to investigate the condition of the stock market before giving the advice to the listeners.


Therefore, defence should not apply where Phillip from Radio 2ZW should be liable for the loss/ harm suffered by Jane and Tom


Air. Org, (2013) Elements of negligence, retrieved from;

Blake v Galloway [2004] CA

Bolton v. Stone [1951] AC 850, [1951] 1 All ER 1078

Donoghue v Stevenson [1932] AC 562, HL

Liverpool Catholic Club Ltd v Moor [2014] NSWCA 394

Rylands v Fletcher (1868) LR 3 HL 330