Donoghue v Stevenson [1932] AC 562 is a significant negligence case because it

establishes:
the neighbourhood principle.
the duty of care principle.
that liability for harm caused by product defects can extend beyond a contract.

that a manufacturer may be liable, when there is a careless process of manufacture,

for harm to an ultimate consumer.
all of the above.
none of Options 1 to 4 above.

Fiduciary duties generally require:

disclosure to the beneficiary/principal if the fiduciary stands to gain personally from

the transaction.
considering the interests of the beneficiary/principal.
refraining from doing anything which will harm the interests of the
beneficiary/principal.
all of the above are general fiduciary duties.

A `Chinese wall` is:

a defence.
a cause of action.
illegal in New Zealand.
illegal in New Zealand and the United Kingdom.
a statutory obligation.
Which of the following elements would a plaintiff suing in the tort of negligence
have to prove in order to succeed in the action?

A breach of the duty of care owed to the plaintiff; the fact that the breach caused
the harm to the plaintiff and that the defendant intended to cause that harm; and
that the harm is not too remote.

A breach of the duty of care owed to the plaintiff; the fact that the breach caused
the harm to the plaintiff; and that the harm is not too remote.

A breach of the duty of care owed to the plaintiff; the fact that the breach caused
the harm to the plaintiff; that the harm is not too remote; and that there is no
contract between the plaintiff and the defendant.

A duty of care was owed to the plaintiff; that the duty of care has been breached by
the defendant; and that the harm is not too remote.

In the law of negligence, the higher the potential risks associated with doing
something:

the less likely a court would be to impose a higher standard of care upon a
defendant.

the more likely a court would be to impose a higher standard of care upon a
defendant.

the more likely a court would be to excuse the actions of the defendant.

the less likely a court would be to find that a duty of care was even owed to the
plaintiff.

A counter offer:
must be made in person over a counter.
restarts the pre-contractual negotiation/bargaining process
.will result in a new bargain unless promptly rejected by the other party.
`Opening the floodgates` is a principle which is relevant, in negligence, to the court
determining:

whether it is appropriate in the case in question to lower the requisite standard of

care.

whether it is just and reasonable to find a duty of care in the case in question.

the degree of sharing of liability where there are several defendants in the case in
question.

liability in a case where the defendant alleges a new intervening act.

liability in a case involving vicarious liability.

Which of the following is potentially a complete defence in an action for negligent

misstatement?

Contributory negligence.

An effective disclaimer.

The fact that a duty of care was owed by the defendant to the plaintiff.

The fact that it was reasonable for the plaintiff to have relied on the statement
made by the defendant.

All of the above are potentially complete defences in an action for negligent
misstatement.

Case law:
is the major source of the law of fiduciary obligations.

is based on the historic doctrine of precedent.

is the subject of ongoing development in our legal system, as new cases come
before the courts to be decided upon.

continues to develop the law of fiduciary obligations as new cases are litigated,
including those claiming a breach of fiduciary obligations in circumstances outside
the traditional categories.

all of the above are true statements.

Question 1

0.1 / 0.1 pts

The Commerce Act outlaws:

All anti-competitive arrangements.

All anti-competitive arrangements unless they have been authorised by the

Commerce Commission.

Anti-competitive arrangements that substantially lessen competition in a market,

unless the arrangement has been authorised by the Commerce Commission.

Anti-competitive arrangements that substantially lessen competition in a market

and such arrangements cannot be authorised by the Commerce Commission.

Question 2

0.1 / 0.1 pts

Liability in negligence is part of:
the law of contract.

the law of torts.

fiduciary law.

the law of equity.

the law of statutory obligations.

None of the above.

Question 3

0.1 / 0.1 pts

Select the most accurate statement from the following. If a firm of accountants
were to act for two parties involved in a competing takeover bid for shares in the
same target company, the firm should:

instruct one of the bidding parties to give up its bid as the accountants know that
one party will be unsuccessful and it is better to persuade one to get out now rather
than later.

ensure that there is a Chinese wall in place to avoid the risk of leakage of
confidential information from either side to the other, as New Zealand courts
recognise the Chinese wall defence.
decline absolutely to act for both parties as there is a conflict of interest and the
Chinese wall defence is not available in New Zealand.

just go ahead acting for both parties because, as long as the firm has insurance, they
can`t be touched.

IncorrectQuestion 4

0 / 0.1 pts
Which of the following statements is correct:

The court only has power to adjust parties’ rights under a contract brought about by
duress where there have been physical threats made to one party by the other or
where threats have been made to a party's goods or property.

A contract in restraint of trade may be enforced by the court provided the restraint
is reasonable in all the circumstances.

A party's rights under a contract can never under any circumstances be adjusted by
the courts for duress unless threats made are threats to do something that is
unlawful.

To get a remedy for mistake it is sufficient only to prove a common mistake, a

unilateral mistake or a cross-purposes mistake.

Question 5

0.1 / 0.1 pts

In respect of Hedley Byrne liability, select the INCORRECT statement:

Liability only exists if it was reasonable for the plaintiff to have relied on the
statement.
In order to prove causation, the plaintiff must prove that there was actual reliance
on the statement.

The plaintiff must prove that there was no effective disclaimer made by the
defendant.

Liability in tort for negligent misstatement grew out of the House of Lords
judgment in Hedley Byrne v Heller.

The floodgates argument is of particular relevance in negligent misstatement as the

number of people affected by a careless statement is potentially very great.

IncorrectQuestion 6

0 / 0.1 pts
Paul reads the financial column in the morning newpaper. The author gives an
investment tip to buy certain stocks. Paul follows the tip and buys the stocks, but
they are not a good investment. Paul would like not be able to sue the author
because:

he would be unable to prove causation.

he would be unable to prove a breach of a standard of care.

he would be unable to show it was reasonable for him to rely to the author's advice.

there would be an implied disclaimer.

IncorrectQuestion 7

0 / 0.1 pts
Which of the following statements is INCORRECT:

Mrs. Carlill had an agreement with the Carbolic Smoke Ball Company because it was
clear its advertisement was intended to be taken seriously as an offer.

Mrs. Carlill accepted the Company's offer by buying the smoke ball, using it as
directed and catching influenza.

There was no consideration for Mrs.Carlill's agreement with the Company so there
was no contract. But she still got damages because of the principle in Donoghue v.
Stevenson.

An acceptance of an offer of a unilateral contract is also complete performance by

the offeree of his or her obligations under the contract.

IncorrectQuestion 8

0 / 0.1 pts
The plaintiff injured by the cricket ball in Bolton v Stone [1951] AC 850 did not
succeed in obtaining damages in negligence because:

being a mere passer-by, she was not a foreseeable or proximate plaintiff.

sports people do not generally owe duties of care to members of the public, though
they do owe contractual duties to their clubs.

there was no right to sue for damages for personal injury in England at that time
because of accident compensation.

the chances of her being struck and injured in that fashion were unlikely and difficult
to anticipate.
people walking near sports grounds have a duty to remain alert and on the lookout
for balls which have been hit over the fence, as there is a real likelihood of this
occuring.

sport is a socially desirable activity, resulting in a lower standard of care being

placed on the cricket club.

Question 9

0.1 / 0.1 pts

Which of the following statements is correct:

Damages is the only remedy available in New Zealand law for breach (breaking) of
contract.

The time for calculating damages is when the person whose contract has been
broken, files court proceedings.

Damages are calculated to put the innocent party in the same position as if the
contract had not been broken.

Specific performance is never granted for breach of a contract.

Question 10

0.1 / 0.1 pts

In relation to the law of contract:

It is not permissible for the parties to agree at the time a contract is made what
damages should be recoverable in the event of a breach of the contract, as this is
seen as an attempt to exclude the jurisdiction of the courts in determining the
amount of damages, and is therefore unlawful.
It is permissible for the parties to agree at the time a contract is made what
damages should be recoverable in the event of a breach of the contract, and any
amount agreed upon will be strictly enforced by the courts.

It is permissible for the parties to agree at the time a contract is made what
damages should be recoverable in the event of a breach of the contract, but a court
will only uphold such a term if the amount agreed upon is a genuine pre-estimate of
loss in the event of a breach of contract.

It is permissible for the parties to agree at the time a contract is made what
damages should be recoverable in the event of a breach of the contract, but a court
will only uphold such a term of contract if the contract has been registered under
the Commercial Transactions Act 2007.

None of the above is a correct statement.

Question 1

0.1 / 0.1 pts

Fiduciary relationships are basically characterised by:

trust and confidence in one party by another who is in a vulnerable position.

a recognition that both parties are essentially on an equal footing in their dealings
with each other, but with one being more wealthy than the other.

dedication to the interests of the principal in accordance with the provisions of the
Fiduciary Obligations Act 1923.

All of the above.

Question 2

0.1 / 0.1 pts

Case law:

is the major source of the law of fiduciary obligations.

is based on the historic doctrine of precedent.

is the subject of ongoing development in our legal system, as new cases come
before the courts to be decided upon.

continues to develop the law of fiduciary obligations as new cases are litigated,
including those claiming a breach of fiduciary obligations in circumstances outside
the traditional categories.

all of the above are true statements.

IncorrectQuestion 3

0 / 0.1 pts
Which of the following statements is correct:

An offer and an acceptance may be made by the conduct of the parties when the
offeror or the offeree (as the case may be) knows of the conduct.

In a supermarket setting, the owner of the supermarket is making an offer by

putting products on shelves where they can be selected by the shoppers.

An "invitation to treat" is where the owner of the supermarket offers a bonus such
as "two for the price of one" or "if you buy this product your name will go in a draw
for a holiday in the Bay of Islands".

Question 4
0.1 / 0.1 pts
Which of the following elements would a plaintiff suing in the tort of negligence
have to prove in order to succeed in the action?

A breach of the duty of care owed to the plaintiff; the fact that the breach caused
the harm to the plaintiff and that the defendant intended to cause that harm; and
that the harm is not too remote.

A breach of the duty of care owed to the plaintiff; the fact that the breach caused
the harm to the plaintiff; and that the harm is not too remote.

A breach of the duty of care owed to the plaintiff; the fact that the breach caused
the harm to the plaintiff; that the harm is not too remote; and that there is no
contract between the plaintiff and the defendant.

A duty of care was owed to the plaintiff; that the duty of care has been breached by
the defendant; and that the harm is not too remote.

Question 5

0.1 / 0.1 pts

Cancellation of a contract is:

a right of any innocent party in response to any breach of contract.

available as a response to serious breaches of contract only.

the right to withdraw acceptance within a reasonably short time frame after the
contract is first made.

never available as it causes uncertainty in trade and is a breach of section 9 of the

Fair Trading Act 1986.
Question 6

0.1 / 0.1 pts

Fiduciary relationships are generally owed by:

the police, to the public.

retailers, to customers.

politicians, to the electorate.

all of the above (Options 1 to 3) are fiduciary relationships.

none of the above (Options 1 to 3) are fiduciary relationships.

Question 7

0.1 / 0.1 pts

Which of the following relationships is characterised as an `established` or
`traditional` fiduciary relationship?

Landlord and tenant.

Director and shareholders of the company.

Banker and customer.

Franchisor and franchisee.

None of the above.

IncorrectQuestion 8

0 / 0.1 pts
A fiduciary is not permitted to compete in business with his principal because:

such behaviour is not good for the economy, particularly due to the fact that it is
inflationary.

such behaviour would be a breach of the Fiduciary Duties Act 1908.

a fiduciary is required to put the interests of the principal ahead of his own.

All of the above.

Question 9

0.1 / 0.1 pts

A `Chinese wall` is:

a defence.

a cause of action.
illegal in New Zealand.

illegal in New Zealand and the United Kingdom.

a statutory obligation.

Question 10

0.1 / 0.1 pts

In relation to fiduciary law, it is correct to say:

fiduciary duties will vary depending on the type of fiduciary relationship.

the law of fiduciary obligations is a central part of equity.

liability may be avoided in a conflict of interest situation if there is full disclosure of

all material facts and agreement to the conflict.

All of the above are correct.