Jack works as a financial planning consultant for Adco Ltd.,a company that provides financial advice to its clients.At a three-martini lunch with Benson,one of Adco's clients,and Carson,a friend of Benson,Jack mistakenly advised Benson to buy shares of Moose Jaw Mining because he thought that Adco had investigated the prospects of the company.In fact,Adco had investigated Goose Jaw Mining and was recommending it to its clients.As it turned out,Benson ignored Jack's advice but Carson bought a lot of Moose Jaw shares and lost all of his money when the mining operation went broke.Which one of the following statements accurately describes Carson's legal situation?

Question

Quizplus · Accepted Answer

Jack, as a financial planning consultant, owed a duty of care to his clients and their friends to be careful in providing advice. He breached this duty by mistakenly advising Benson to buy shares in the wrong company. Even though Carson was not a client of Adco, he relied on Jack's advice and suffered a loss. Therefore, Jack could be held liable for Carson's loss if Carson can establish that Jack owed him a duty to be careful. Option A is incorrect because liability in tort does not require a contractual relationship. Option B is incorrect because Adco cannot be held liable for an action taken by an employee outside the scope of their employment. Option C is incorrect because the law still holds people responsible for their actions when under the influence of alcohol. Option D is incorrect because Benson cannot be held liable for Carson's loss since he did not give the advice, and there is no direct link between Benson and Jack's employment relationship.

Jack Works as a Financial Planning Consultant for Adco Ltd