Peter approached David, a chartered accountant, and asked his advice as to the financial position and

profitability of a business that he was interested in investing. David, prepared a business report for

Peter and concluded that it would be a profitable, secure and viable investment, in fact David made

the comment that: "The business is booming and is a gold mine!" which in fact, induced Peter to

enter into the investment. However, in preparing the business report David overlooked the fact that

the proposed business to be invested in by Peter, had not provided sufficiently for bad debts. Thus,

on reliance of David's statement and business report, Peter went ahead and invested his money in the

business, but within three months the business Peter invested in was in serious financial difficulty

and Peter was in serious danger of losing the majority of his investment.

Does Peter have any claim against David in this situation? Explain in detail outlining the elements

of negligence by the professional David.

1. What are some examples of legal rules that have ethical characteristics when conducting business at a domestic or international level?
2. What is meant by 'socially responsible investing' by business and companies?
3. What fundamental values and beliefs are actually embodied in the Law?
4. Within any society and legal system, what is meant by the ideal of the 'rule of the law'?
5. What are the main differences between common law and statute law?
6. What are the three main purposes of the hierarchy of courts within a legal system?
7. Within the context of law making and precedent what is the meant by the term res judicata?
8. List some arguments for and against the system of judicial precedent (judicial activism) within any legal system.
9. Distinguish the legal expressions used in the creation of precedents, ratio decidendi and obiter dicta.
10. How does a persuasive precedent differ from a binding precedent and are courts always bound by such precedents?