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All About Animals is expanding, and is considering opening a new store on the other side of Melbourne. It hires Paige, a business analyst, to provide a report assessing the proposed new store’s feasibility. It is important for All About Animals that the new store is profitable, as losses will affect its ability to re-home abandoned pets (and therefore to achieve the business’ core purpose). Paige analyses the business processes of All About Animals, the demographics of its customer base, and the location of the proposed new store. Paige’s written report recommends going ahead with the new store, and All About Animals opens the new store. When preparing her report, Paige was unaware that the local council had just approved a massive long-term construction project on the property next door. Noise from the demolition and construction work seriously impacts upon the new store. Customer numbers are much lower than they would be otherwise, and significant losses are incurred. The construction project would have been discovered if Paige had made enquiries with the local council. Does Paige owe a duty of care to All About Animals in the tort of negligence, in relation to the provision of her advice? Do not discuss other elements of the tort of negligence when answering this question. Please ensure that you use relevant legal principles and authority in support of your answer (ie. cases and/or legislation).

Question

All About Animals is expanding, and is considering opening a new store on the other side of Melbourne. It hires Paige, a business analyst, to provide a report assessing the proposed new store’s feasibility. It is important for All About Animals that the new store is profitable, as losses will affect its ability to re-home abandoned pets (and therefore to achieve the business’ core purpose).

Paige analyses the business processes of All About Animals, the demographics of its customer base, and the location of the proposed new store. Paige’s written report recommends going ahead with the new store, and All About Animals opens the new store.

When preparing her report, Paige was unaware that the local council had just approved a massive long-term construction project on the property next door. Noise from the demolition and construction work seriously impacts upon the new store. Customer numbers are much lower than they would be otherwise, and significant losses are incurred. The construction project would have been discovered if Paige had made enquiries with the local council.

Does Paige owe a duty of care to All About Animals in the tort of negligence, in relation to the provision of her advice? Do not discuss other elements of the tort of negligence when answering this question. Please ensure that you use relevant legal principles and authority in support of your answer (ie. cases and/or legislation).

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Solution

In order to determine whether Paige owes a duty of care to All About Animals in the tort of negligence, we need to consider the principles established in the case of Donoghue v Stevenson [1932] AC 562. This case established the 'neighbour principle', which states that a person owes a duty of care to their 'neighbour', who is anyone who could be reasonably foreseen to be affected by their actions or omissions.

In this case, Paige, as a business analyst hired by All About Animals, could reasonably foresee that her advice would be relied upon by the company in making their decision to open a new store. Therefore, it could be argued that she owed a duty of care to the company to ensure that her advice was accurate and comprehensive.

However, the scope of this duty of care is not unlimited. In the case of Caparo Industries plc v Dickman [1990] 2 AC 605, the court established a three-part test to determine whether a duty of care exists: foreseeability of harm, proximity of relationship, and whether it is fair, just and reasonable to impose a duty of care.

Applying this test to the current situation, it is clear that harm was foreseeable if Paige failed to provide accurate and comprehensive advice. There was also a close relationship between Paige and All About Animals, as she was hired specifically to provide advice on the feasibility of opening a new store. However, whether it is fair, just and reasonable to impose a duty of care on Paige for failing to discover the construction project is a more complex question.

This would likely depend on the specific circumstances, including whether it is standard practice for business analysts to check with local councils for potential disruptions when assessing the feasibility of new business locations. If it is, then it could be argued that Paige breached her duty of care by failing to do so. However, if it is not standard practice, then it may be considered unreasonable to impose this duty on Paige.

In conclusion, while Paige likely owed a general duty of care to All About Animals, whether she breached this duty by failing to discover the construction project would depend on the specific circumstances and standards of her profession.

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