To have the schools valued for insurance purposes, a school district hired a firm of surveyors to give them a statement of value. To prepare the report, the surveyors took the relevant measurements, which were then given to a statistical tabulating company that does the calculations based on the measurements. Surveyors always use the services of such tabulating companies. An error was made in the calculations, so the surveyor's report was wrong. Therefore, the buildings were under-insured. When one of the school buildings was destroyed by fire, the school district did not get sufficient funds from the insurance company to rebuild the school. On these facts, which of the following is true? (Assume that the school district has the ability to sue and be sued in court.)

Question

Quizplus · Accepted Answer

The school district can pursue a claim for negligent misstatement against the statistical tabulating company, as the error in the calculations led to under-insurance and subsequent economic loss. The school district may also potentially have a claim against the surveyors for professional negligence in subcontracting the calculation work, but this is not mentioned as a choice in the question. Option A (nuisance) and Option B (Small Claims Court) are not relevant in this scenario. Option E (statistical tabulating company cannot be sued) is incorrect as they can be sued for negligent misstatement causing economic loss.

To Have the Schools Valued for Insurance Purposes, a School