Hi there, can you please help me with some legal cases that would set precedent for the following question.

Problem 1: Suppose a Court hears a case with the following facts: Mr Chan was a bespoke tailor who ran a thriving and successful business in a small country town. As part of his business, he sourced and purchased the finest Australian materials possible for garment making including linens, cottons, wool and silks. The products he sourced were all of very high quality which he then used to create exclusive and unique fashion garments for his customers. One morning, after returning from a week's holiday, Mr Chan unlocked the fabric storeroom to access a special woolen fabric that he had recently purchased in order to make woolen graduation blazers for a local high school. Mr Chan had purchased the fabric directly from the manufacturer of the wool, 'Macarthur Woolen Mills' ('MWM') for $80,000. As he rolled the first length of wool across the cutting table, ready to cut the fabric for the blazers, Mr Chan was shocked to see what he described as being "thousands of worm-like creatures" crawl out from the fabric. The entire woolen fabric was destroyed and no part of it could be salvaged. Mr Chan had never seen anything like this before and he immediately became ill with severe vomiting and was quite traumatised by the sight of the larvae crawling out from every part of the fabric. He was unable to continue in his work for eight weeks. Mr Chan was diagnosed with post-traumatic stress as a result of the incident. He lost the entire fabric as well as other all other fabrics which were stored in the same storeroom. He also lost the contract with the school for the provision of the graduation blazers. Mr Chan brought a claim in negligence against MWM for causing him to suffer the illness and post traumatic stress disorder. Mr Chan successfully established that the fabric he purchased from MWM was the source of the infestation. Mr Chan was successful in his negligence claim against MWM. What binding and/or persuasive precedents (if any) could be used by the Judge hearing this case in their judgment to hold the manufacturer of the woolen fabric, MWM, liable? Explain how the precedent/s that you have used are relevant to the facts of Mr Chan's case.