Six months later, the same client comes to see you again. She shows you an advice received recently from the partnership¡¦s investment banker, Selby Bank, which suggests that the partnership should engage in some risky behaviour because it will produce a large profit. The partners acted in reliance upon the advice from Selby Bank, which said ¡¥you need not spend money to remove the toxic waste under the new block of flats you are building in Epping because no one will ever know¡¨. The partnership now finds its development discussed in a front page article in today¡¦s Sydney Morning Herald in a scandal over the toxic waste. As a consequence, the partnership¡¦s external financier (Blazey Bank) is refusing to provide the rest of the loan funding to complete the development. Each partner will lose $1million as a result.

Question

Six months later, the same client comes to see you again. She shows you an advice received recently from the partnership¡¦s investment banker, Selby Bank, which suggests that the partnership should engage in some risky behaviour because it will produce a large profit. The partners acted in reliance upon the advice from Selby Bank, which said ¡¥you need not spend money to remove the toxic waste under the new block of flats you are building in Epping because no one will ever know¡¨.  The partnership now finds its development discussed in a front page article in today¡¦s Sydney Morning Herald in a scandal over the toxic waste.  As a consequence, the partnership¡¦s external financier (Blazey Bank) is refusing to provide the rest of the loan funding to complete the development. Each partner will lose $1million as a result.

Under these circumstances, can the partners sue Selby Bank for the losses incurred? In your answer, you are to apply both the common law and statutory law on the relevant area of negligence. For statutory law, you are to refer to the Civil Liability Act 20021 (NSW

SraJMcGin · Answer

Thank you for using the Jiskha Homework Help Forum. For one thing, NEVER do business with the Selby Bank! I can't believe a bank would give such bad advice nor that it would encourage a client to take a risk. As soon as you hear the words "no one will ever know" you have to be aware that it is something illegal!

If you need the Civil Liabiity Act 20021 just ask. "Buyer Beware" means if the partnership signed a contract with the bank it doesn't sound like grounds to later sue that bank!

I'll see what else I can find for you.

Sra

SraJMcGin · Answer

Sorry that I could not find that law online.

Many people seem "sue happy" but a good lawyer may give advice freely or take the case "pro bono." It would seem the partnership would have to proove monetary loss.

Sra