M05 Insurance Law

Coursework submission rules and important notes

Before you start your assignment, it is essential that you familiarise yourself with the Coursework assessment guidelines and instructions available on RevisionMate.

This includes the following information:

• These questions must not be provided to, or discussed with, any other person regardless of whether they are another candidate or not. If you are found to have breached this rule, disciplinary action may be taken against you.
• Important rules relating to referencing all sources including the study text, regulations and citing statute and case law.
• Penalties for contravention of the rules relating to plagiarism and collaboration.
• Coursework marking criteria applied by markers to submitted answers.
• Deadlines for submission of coursework answers. 
• You must not include your name or CII PIN anywhere in your answer.
• The total marks available are 200. You need to obtain 120 marks to pass this assignment.
• Your answer must be submitted on the correct answer template in Arial font, size 11.
• Answers to a coursework assignment should be a maximum of 12,000 words. The word count does not include diagrams however, it does include text contained within any tables you choose to use. The word count does not include referencing or supplementary material in appendices. Please be aware that at the point an assignment exceeds the word count by more than 10% the examiner will stop marking.

Top tips for answering coursework assignments

• Read the Specimen coursework assignment and answer for this unit, available on RevisionMate.
• Read the Learning Outcome(s) and related study text chapter for each question before answering it.
• Ensure your answer reflects the context of the question. Your answer must be based on the figures and/or information used in the question.
• Ensure you answer all questions.
• Address all the issues raised in each question.
• Do not group question parts together in your answer. If there are parts (a) and (b), answer them separately.
• Where a question requires you to address several items, the marks available for each item are equally weighted. For example, if 4 items are required and the question is worth 12 marks, each item is worth 3 marks.
• Ensure that the length and breadth of each answer matches the maximum marks available. For example, a 30 mark question requires more breadth than a 10 or 20 mark question.

Additional M05 coursework tips

It is recommended that you take the following four-step approach when planning an answer to an M05 question:

• Step One: Identify which area(s) of the law the question is testing and link it back to the correct Learning Outcome(s).
• Step Two: Explain how the relevant area(s) of the law, in outline, may relate to the context set out in the question. Identify relevant statute and case law. When quoting law, focus on the ratio decidendi rather than the general facts of the case.

          For further information see chapter 1 of the M05 Study text.

• Step Three: Apply the relevant principles of the law, including statute and case law, to the question.
• Step Four: Include in your answer a conclusion which directly links back to the question and relevant area(s) of the law.

The coursework questions link to the Learning Outcomes shown on the M05 syllabus as follows:

To be completed before submission:

Start typing your answer here:

Question 1 – Learning Outcome 2 (10 marks)

1. The issue in this question is what kind of tort Simon committed. The relevant law is the principle of negligent misstatement.  Parsons (2018: 2/13 defines negligent misstatement as a tort that occurs when the defendant owes the claimant a duty of care but carelessly made a false or misleading statement, which the claimant relied on and suffered loss as a consequence. As noted by Parsons (2018: 2/13), three special rules that were established in Hedley Byrne & Co Ltd v Heller & Partners Ltd (1964) must apply for negligent misstatement to occur. 1) there is a special relationship between the party, where one party seeking the information or advice was trusting the other party to exercise reasonable care, 2) the other party gave information knowing that the inquirer was intending to rely on it a. 3) the information was relied upon causing detrimental to the claimant in Shaddock v Parramatta City Council 1981 the court held that in the course of business or profession, a person who provide advice or information of a kind which requires skills and competency, and the person ought to have known the other party intended to rely on such information has a duty of care and if they provide misleading or inaccurate information, they are liable for negligence misstatement. Applying the Shaddock vs Parramatta and Hedley Byrne & Co Ltd v Heller & Partners Ltd (1964) in the current case, there is a business relationship between Simon and the Policyholders. Therefore, when the policyholder asked Simon whether a repair to the property should commence pending the outcome of the claim, it is clear that the policyholder, in this case, sought information he was intending to rely on.  Secondly, given that this was a professional relationship and that Simon was an employee of the insurance company, he was in a better position to give accurate and professional information to the policyholder. Therefore, it was reasonable for Him i.e. policyholder to rely on the information provided to him by Simon. Finally, as a result of the information Simon provided to the policyholder, the latter suffered an economical loss in terms of the cost of repair. Therefore, given that all the three rules established in Hedley Byrne & Co Ltd v Heller & Partners Ltd (1964) are satisfied, it is likely that Simon would be found to have committed negligence misstatement.
2.  

For negligent misstatement to occur, the party who relied on the information provided must have suffered an economical loss.  This, therefore, mean that the innocent party can sue for damages.  As noted by Parsons (2018; 2/29), the object of the award of damage is to compensate the innocent party i.e. the claimant for the loss they suffered as a result of the wrongful act of the defendant. Since in the current case the policyholder suffers economic cost, he can sue Simon for the award of damages to compensate for the loss he incurred as a result of Simon’s wrongful act 

Question 2 – Learning Outcome 3 (10 marks)

1. The main question is whether Bella can establish her own brokerage firm in the town.  The relevant law to be considered here is the contract under restrained trade otherwise known as a restrictive covenant in agreement. It is clear that Bella has a contract of employment with KL ltd. in the contract, there is a restrictive covenant that prohibits Bella from working on any brokerage firms within 25 miles, in the next five years after leaving their employment.  Given this context, the question that arises is whether such a restrictive covenant would be binding to Bella and if it would apply if she was to establish her own brokerage firm.

According to Parsons (2018: 3/20), a contract of restrained trade is said to occur where there is a clause in the contract which prohibits an employee from engaging in certain actions while in employment or after leaving their employment. In Spafax ltd vs Harrison (1980), it was established that employers can require an employee to sign a covenant restricting employee's future activities after employment comes to an end, provided that the restriction is necessary for the protection of employers' genuine interest. So, in the current case, it is important to know whether the covenant between Bella and KL ltd is meant to protect any reasonable business interests. As noted in Parsons (2018: 3/20) reasonable business interests that a business can seek to protect using restrictive covenant are trade secret and confidential information, existing customers and connections, enticing employees, and working for competitors. Therefore, KL Ltd has the right to restrict Bella through a restrictive covenant not to be employed by brokerage firms in the said town and within the specific period of time, if the employer's motive in doing so is to protect one of the four business interests above. However, the employers’ right to impose restrictive covenant is limited. As established in Attwood v Lamont [1920] if the restrictive covenant has the effect of restraining an individual from earning his livelihood in the future, then the court will disapprove of any such agreement. Also as established in SW strange ltd vs Mann (1965), if such a restrictive covenant is meant to protect employers from the competition, then the court will disapprove such agreement.  In the current case, KL ltd did not specify the interests that it was seeking to protect.  Therefore, based on the application of Attwood v Lamont [1920]  & SW strange ltd vs Mann (1965), the restrictive covenant in the Bella contracts cannot prevent her from using the skills, knowledge, and abilities gained during her previous employment to earn a  livelihood for herself nor can it apply to limit or protect KL ltd from potential competition from Bella. therefore, it is likely to be ruled that Bella, can establish a brokerage firm with the new town area as long as she does not uses any trade secret and confidential information to the detrimental of her former employer and does not entice or approach former employer’s customers and does not entice employees from the former employer and does not work for competitors. 

b)

 Joe can prevent KL ltd.’s directors from establishing a similar business within the town through the use of a non-competing clause/covenant. In the sale of a business, most of the restrictive covenant receive less scrutiny by the court since the partner to the contract usually has an equal footing into the negotiation. also, it is the sale of a business, the court regard such covenant to be necessary to protect the value bargained for by the purchaser of the business (Parsons (2018: 3/21). 

Question 3 – Learning Outcome 4 (10 marks)

The relevant law to be considered in this question is the relationship between principle and agents.

 a), according to the law of agency, the agent usually has some duties owed to the principal. These includes 

1) The duty to obey principal’s instruction

2)  Duty to exercise proper care and skills

3) To perform duties personally 

4) To act in good faith toward the principle

5) To account for money received on behalf of the principle (Parsons (2018:4/8)

In the current case, the commission paid by GB Ltd and Finley to the agent raises several issues two of which are, 1) did the agent acted in good faith toward the principal, 2) is the agent both an agent of Finley and GB ltd which would give rise to a conflict of interest? In the first case, an agent has the duty to act in good faith toward the principal. This means that they should not allow personal interests to conflict with those of the principal. As such, they should at all-time advance the interest of their principal and not personal interest. Also, this means that they should make full disclosure of all relevant information affecting the principal. The double commission paid by GB ltd and Finley then raises the question of whether the agent acted in good faith of advancing the principal interest or they were pursuing their own interest.  In the second case, the legal issue that arises is whether the agent can act as an agent for both parties to a transaction hence receiving commission from both parties. Who was the agent representing in this case? Is it GB ltd or is it Finley? As noted by Parsons (2018:4/8) the fact that an agent can work for both parties in the same transaction can lead to some difficult situations. In North & south Co V Berkeley (1970) ¸ the agent worked for both the insurer and insured in a settlement and therefore the court had to decide who the agent was representing. The court held that since the agent was shown some documents by the insurer relevant to the settlement claim, they were working for the insurer and not insured, and therefore they were not at liberty to shows the content of the document to the insured. 

1. The recruitment company which is the agent in this case has a duty to obey the principal. However, as seen in the North & south Co V Berkely (1970), where the agent represents both parties in a transaction, the court will have to look at the circumstance of the case and determine who the agent was representing in the transaction. in the current case, it is determined that the agent was representing the  GB ltd, then it will be considered to have breached the duty of obedience since it did not obey the principal instructions i.e. candidate must have 2 years’ experience. If however, it is established that the agent was representing Finley, then failure to recruit someone who has at least 2 years of experience would not be considered as a breach of duty since he did not work for GB ltd. However, this would mean that since the agent was not working for GB ltd, they were not entitled to the payment of commission and therefore GB ltd should recover the commission paid.  GB ltd can also sue for damage under the tort of deceit. 

Question 4 – Learning Outcome 5 (30 marks)

1. The question involves the duty of fair representation by the insured under the insurance Act 2015.  S.3 (4) (a) Insurance Act 2015 provides that the insured is required to disclose every material circumstance which the insured knows or ought to know. S7 of the insurance act 2015 refers to material circumstance or fact as something that would influence the judgment of a prudent insurer in determining whether to take risks and if so under which term. in  Container Transport International Inc. v Oceanus Mutual Underwriting Association (Bermuda) Ltd (1984) it was held that the phrase ' influence judgment' simply means that the fact must be one which a typically reasonable underwriter would want to know about when forming their opinion about the risk. This is therefore an objective test, which provides that if a fact is one that would cause a reasonable underwriter to act differently had they known about it, then it is a material fact or circumstance.  In the current case, the policyholders had a duty to make fair representation to the insurer about the usage of the property. , it is clear that they indicated that the property was their permanent residency. On the contrary, they occasionally rented it out temporally and this is information that was not disclosed to the insurer.  This raises the question of whether such information is a material fact that would have influence the judgment of the insurer about the risks involved.  Well, a typically reasonable underwriter would have been interested in knowing such information since the usage of the property influence the judgment they would make about the risks involved. Therefore, if the objective test established in s7 of insurance act 2015 and in container transport international Inc. Vs Oceanus mutual underwriting association ltd was to be applied in this case, then it is likely that short-term let is a material fact that would have caused the insurer to act differently had they known about it. Therefore, the policyholder breached his duty to make fair representation to the insurer and hence the claim can be denied. 
2. Given that the policyholder breached the duty of making fair representation to the insurer, the entire claim ought to be denied. This includes personal possession. In addition to that, the personal possession that the policyholder is claiming for is not his/her, and as such he/she does not have any insurable interest in them. 

1.   Under S.3 (4) (a) Insurance Act 2015 provides that the insured is required to disclose every material circumstance which the insured knows or ought to know. This means that the policyholder has a duty to make a fair representation of all material facts before the contract is formed. Information is considered material fact is it has the ability to influence the judgment of a typical reasonable insurer.  Therefore, in this case, the main question is whether the information about the policyholder's criminal conviction of the burglary is a material fact or not. In a normal case, a typical reasonable underwriter would be interested in knowing such information since it would influence their judgment about the risks involved and therefore the judgment of whether to insure and if so under which term.  Therefore, it could be considered a material fact. However, the timing of the material fact or circumstance is also necessary. In this case, the policyholders were convicted for burglary after the insurance contract is already formed. Therefore, in the current insurance contract, it is not a material fact but in a future insurance contract, it would be considered a material fact. 

Question 5 – Learning Outcome 6 (20 marks)

1. This question is about the law relating to the classification of the contractual term. As noted by Parsons (2018: 7/2) the classification of terms of the insurance contract is somewhat complex than in general law.  While the classification of terms in an insurance contract has its roots in general law, in the insurance contract, the nature of a term is often considered when there is a breach.  It is important to note that in insurance law, the fundamental term of the contract is not classified as conditions but they are classified as warranties. this strict nature of warranties can be seen in section 9 of the insurance act 2015, which provides that a warranty must be strictly complied with whether they are material to the risk or not, and if it is not complied with the insurer is discharged from the liability. In the current case, there is a term of the contract that ‘The burglar alarm must be maintained in full working order at all times and activated when the premises are unattended. It must be remembered that the importance of the term would determine its classification. Therefore, given that the breach of this term is likely to lead to serious consequences. I.e. make it easier for break-in and theft without being noticed, this term is a fundamental term to the contract i.e. warranty.  As provided in s9 of the insurance act 2015, a breach of warranty would discharge the insurer from the liability. When Olivia left the office, he thought she has activated the bulger alarm and its failure to work might have been due to a fault. If this is proved to be the case, the warranty was complied with and therefore the policy remains effective and the claim is likely to succeed. However, if it is established that Olivia thought to have activated the alarm but did not do so, then the warranties were breach and the insurer would be discharged from his liability.

1. As noted earlier, the classification of terms in insurance contracts often occurs when the breach has occurred. If the breach has resulted in serious consequences, then the term was a fundamental one i.e. warranties. In the current case, there was a term that ‘the insured must remove the safe keys from the premises when the premises are unattended.'  Olivia left the premises unattended and also did not remove the safe keys.  As a result, the say keys were used by thieves to access cash from the safe in the office. Therefore, given that the breach of the term leads to serious consequences, i.e. theft of the cash from the safe in the office, it is a warranty in the insurance contract. Hard it been complied with, the thieves could probably not have been able to access the cash from the safe. Therefore, it was a warranty that was breached since Olivia left the safe keys in the unattended premises. Therefore as provided in s9 of the insurance act 2015, when the insured fails to comply with the warranty, the insurer is discharged from his liability. Therefore, in the current case, the insurer is discharged from his liability and therefore the claim by Olivia’s business would not succeed. 

Question 6 – Learning Outcome 7 (20 marks)

1. The relevant law, in this case, is the doctrine of proximate cause and the remoteness of the damage.  In insurance law, there are three types of important perils. These are the insured peril, the uninsured peril, and the excluded perils. Unfortunately, an event might occur in which multiple perils are involved and in such case, it becomes necessary to determine what caused the actual loss. Was it the insured peril, the uninsured, or the excluded perils?  To help solve such confusion, the doctrine of proximity cause was established in Pawsey V. Scottish Union and National (1908). The doctrine of proximity cause simply means that the loss in question must result directly from the operation of the insured peril for the insurance to pay (Parsons, 2018: 8/11). In Leyland Shipping Co Ltd v Norwich Union Fire Insurance Society Ltd: HL (1918), it was ruled that, where there is a chain of events, the insurer is liable where the loss flow from an unbroken chain directly from an insured peril.  This, therefore, means that if one insured and one uninsured peril are competing with each other, the insured peril prevails and the loss is deemed to have been caused by the insured risks. If one excluded and one insured peril is competing, the excluded peril prevail and therefore the insurance may reject the claim. In the current case, the loss in question is the loss of the tractor after it caught fire.  The main question is what exactly caused the fire. Is it the fire or is the lightning. Applying the principle established in Leyland Shipping Co Ltd v Norwich Union Fire Insurance Society Ltd: HL (1918), there is an unbroken chain of events. That is a lightning strike, as a result, the fire broke out which damaged the tractor. Therefore the first event that leads to the chain of events is a lightning strike. Whether the claim is to succeed depends on whether the lightning strike is an insured peril or excluded peril. if is an insured peril, the claim will stand. If lightning is an excluded peril, the claim will not stand since where an excluded peril is competing against an insured peril is competing, the excluded peril prevails.

1. Section 13A of the insurance Act 2015 makes it an implied term in the contract of insurance, that, once settlement has been agreed, the insurer must pay any sum due in respect of the claim within a reasonable time.  Breach of this implied term will result in contractual damages in addition to the sum due under the policy and any interest in the sum. therefore,  in the current case, the farmer can sue the insurer for contractual damages resulting from their delay in settling the claim, in addition to the sum insured and the interest on that sum 

Question 7 – Learning Outcome 8 (20 marks)

1.  The main issue in this question is whether Paul should succeed in claiming $20,000 for the loss of value of his vintage car after it was being repaired.  The relevant law, in this case, is the principle of indemnity. The principle of indemnity provides that where a loss has occurred, the object of the insurance is to provide the exact financial compensation insured. This means that the insured cannot make a profit from the insurance. The indemnity works in two ways. If the loss occurs, the insurance can 1) cover the cost of the repair of the equipment, property, or the car damaged is repairable or 2) cover the cost of replacement if repair is not possible. In either case, the insured would be considered to be fully indemnified. In the current case, Paul's vintage car was damaged in an accident. This means that the insurance had two option, either repair Paul’s vintage car if it is repairable or write it off if it is not repairable and then pay Paul financial compensation for replacing the car.  The amount Paul would have received if this was the case would have the sum insured for i.e. $120,000. However, since the car was repairable and the insurance did the repair, then under the principle of indemnity, Paul is considered to be adequately compensated even though the car lost value in the process. Having been fully indemnified, Paul cannot then claim $20,000 for the lost value of the car as doing so would mean profiting from the insurance (i.e. have the car repaired and be paid for the loss of car’s value) which is against the principle.

Question 8 – Learning Outcome 9 (20 marks)

 The relevant law in this question is the contribution and subrogation clause in the insurance contract

1. One of the important principles in insurance is the principle of indemnity. The principle of indemnity ensures that a person who suffers a loss is paid an exact amount equal to their loss. Therefore, where there is a case of double insurance, the principle of indemnity prevents the insured from recovering the same loss twice and therefore benefiting from the loss. Therefore, in the event of double insurance, the insurers should fairly share the loss.  Where one insurer indemnifies the person who suffered loss, the insurer is entitled to recover some of the contributions from the other insurer.  In our current case, the deceased employees for whom the claim is made had been insured under two policies, the life policy, and the employer’s liability policy. This, therefore, raise the question of how the insurance, in this case, should have made the contribution and whether there is any recovery to be made following the settlement of the claim.  As noted by Parsons (2018, 10/9) the subrogation and contribution clauses are only effective in the contract of indemnity. Since the death and personal injury cannot be fully indemnified, the life insurance policy and the settlement for death are not contract of indemnity and therefore the contribution clause/principle does not apply in this case. As such, each of the insurers is obligated to pay it fully liable under the contract. As such no recovery is to be made in this case and the next of kin has the right to keep all the payments made to them by both insurers.

1.  The subrogation Principe allows an insurer who has fully indemnified the insured to recover the exact amount from a third party whose negligence led to the damage. However, the subrogation principle only applies to the contract of indemnity (Parsons (2018, 10/4). in our care case,  it is clear that the insurers only agreed to pay for the bodily injury claim and refused to pay for the personal possession as they fell within the excess policy. therefore, since bodily injury is covered under the aspect of the personal accident of the travel policy,  the subrogation principle does not apply. this means that the insurer is liable to pay the full amount insured for and cannot seeks to sue on behalf of the insured to recover that amount from a third party since this is not a contract of indemnity. However, the travel policy has some aspect that is a contract of indemnity i.e. cover for personal possession.  It clear that the insurer did not pay for the damage to personal possession as they fell within the policy excess of $100. It is a common law principle that insurers must have first indemnified the insured for them to exercise the subrogation principle. It is clear in the current case that the insurer only paid for the personal accidents and did not pay to indemnify for the damage to personal possession, therefore they cannot exercise the subrogation right. Given that the claim they paid relates to a personal accident, it is, therefore, a non-indemnity contract, and therefore subrogation rights do not apply. Also given that they did not pay for the personal possession which is an indemnity contract, the subrogation right cannot arise. therefore, the insurer did not have the right to pursue the third party i.e. travel agency and therefore does not have any legal basis to recover or hold into the £18,000 received from the travel agent or recover anything from the  free holiday given to the policyholder by the travel agent

Question 9 – Across more than one Learning Outcome (30 marks)

1. The main issue here is the false information provided by pedestrians A and B differ.  The relevant law, in this case, is the fraudulent claim.  A fraudulent claim is said to occur when the claim involves some form of fraud. There are four different types of frauds in the claim. they are;
2. falsification of loss- this occurs when the insured make a claim when they have suffered no loss
3.  deliberate loss- this occurs when  the policyholder deliberately cause a loss to bring a claim
4.  exaggeration of loss- occurs when the insured exaggerate the amount of loss 
5.  lying about the circumstance of  a genuine loss to improve the change of claim be paid (Parsons, 2018)

In the current case, both pedestrian A and B give false information when making the claim. However, their false information differs.  in the case of pedestrian a, he claimed a loss of earnings for six month period due to reduced mobility as a result of the incident. However, this is false information as it has been established that he never suffered the reduced mobility and therefore his earning were never affected.  Therefore, he made a claim for the loss that was not suffered i.e. falsification of loss. As a result, this is a fraudulent claim which the insurer is entitled not to pay.

 On the other hand, Pedestrian B also made claim for loss earning but it has since been established that he presented a fake payment slip. So, why pedestrian B may have genuinely suffered loss, he lied about the circumstance of the genuine loss by presenting a fake payslip. This is similar to Sharon’s Bakery (Europe) Ltd v Axa Insurance UK plc and others [2012] where a claim was made for genuine loss suffered but since the policyholders had lost the receipt of machinery in the fire, he issued a fake invoice. The court held that this was the use of fraudulent means and devices. While traditionally such a claim where a fraudulent device is used would not be paid for, in the recent court case Versloot Dredging BV & Anor v HDI Gerling (2016), an insurer is not automatically discharged from his responsibilities. They can be made to pay for the claim.

B) The main issue in this question is how to recover the amount paid for the claims that turn out to be a fraud.  The relevant law is the insurance act, the law of tort, and the proceeds of a crime Act 2012. 

  s12 (1) of the insurance Act 2015, provides a general rule that, if the insured makes a fraudulent claim, the insurer is not liable to pay the claim.   The insurer also may recover any sum paid in respect to the fraudulent claim.  This simply means that since both Pedestrian A and B make a fraudulent claim, the insurer is not liable to pay them and should recover the amount already paid to them.   There are two methods in which the insurer can recover the money paid to them. The first method is to claim losses it suffered through the tort of deceit. However, this can only be used as a recovery method if the criteria for the tort of deceit are satisfied.  The second method that the insurer can use is through the application of the proceeds of crime act 2012. If the pedestrian A and B who committed the fraud has been convicted, a confiscation order can be made to recover money that has been fraudulent obtain from the insurer. 

1. The tort of deceit- just like in other tort or civil cases, the person who has brought an action of deceit in the court usually has the burden of proof. Therefore, the insurer has the burden of proof.  As established in Derry vs Peek (1889) in order to sustain an action of the tort of deceit, the insurers must prove that fraud occurred. Fraud is proved when it is shown that a false representation was made knowingly or without belief in its truth. 

Confiscation order under The Proceeds of crime Act 2002. -The second method which is insurer can recover is the confiscation order. This requires a criminal prosecution and therefore for the insurer to successfully prosecute the fraud, it must meet the criminal standard of proof i.e. prove the case beyond reasonable doubt

Question 10 – Across more than one Learning Outcome (30 marks)

The issue to be considered here is the tort, and remedies available. The relevant law is the law of tort

1. As noted by Parsons (2018, 2/17), nuisance is one type of tort. It can be classified as a private and public nuisance. A public nuisance is said to occur when one carries out activities that are likely to cause inconvenience and annoyance to the public.  In the current case, XYX ltd is accused by the residents in the nearby housing estate of parking its vehicle in a way that blocks their access to their home. This amounts to an activity causing inconvenience to the public. Therefore, a public nuisance is one of the torts that the company may have committed. The next tort the company might have committed is the private nuisance. Parsons (2018: 2/17) define private nuisance as interference with a person’s use or enjoyment of their land. In the current case, Xyz ltd has been wrongfully allowing noise and dust to escape from their premises and interfere with Richard’s land.
2.  There are several defences available to the XYZ ltd if an action of public nuisance is brought against them. One such defence is contained in the Prescription Act 1832. This special defence provides that, if the defendant can establish that the actionable nuisance has existed openly and continuously for at least 20 years, their rights to continue with the activities cannot be challenged. 
3.   XYZ Ltd is committing a private nuisance against Richard by allowing noise and dust to escape from their premises to interfere with Richard’s enjoyment of his land. Also, the fire that broke out from the company and destroyed the home can be argued is as a result of XYZ ltd negligence.  Richard has several remedies available to him. The first remedy is to sue for damage. This is usually the appropriate remedy where damaged has been caused. If the fire from XYZ ltd destroyed Richards's property as well, Richard can not only sued for negligence but also sue for the damage caused by the negligence act of the company.   The second remedy available is to seek an injunction. This is most appropriate especially with the private nuisance caused. Richard can seek court injunction stopping the company from  emitting dust and producing  noise that interferes with Richard right and enjoyment of his land 
4. In Rylands v Fletcher [1868], it was held that a person who for his own purpose brings to his land and collect and keep there anything likely to cause mischief if it escapes, must keep it at his peril and if he does not do so, it is prima facia answerable for all damages which is natural consequences of it escape.  So, this ruling established what is called the principle of strict liability. Under this principle of strict liability, liability can arise even where there is no fault or negligence. Applying the Rylands v Fletcher [1868], in the current case, it becomes clear that XYZ ltd collected and kept fireworks in the same industrial premises.  It did so for its own purpose but it obvious that fireworks are at high risks of causing fire and explosion which could cause damage to the nearby area.  Therefore, XYZ  ltd ought to have kept such firework at its own peril and it would be held liable if any damage to a third party resulting from keeping such firework regardless of whether there was fault or negligence. Therefore based on the application of Rylands v Fletcher [1868], in the current case, XYZ is most likely to be held accountable under strict liability for the damage caused to the property in the nearby housing estate. 
5.  under section 1 of the civil liability contribution Act 1978, it is stated that any person liable in respect to any damage suffered by another person, may recover contribution from any other person liable in respect to the same damage whether jointly with him or otherwise. This simply means that if one person is held liable for damaged caused to another person, any other person that contributed to the damage is liable to indemnify the person held liable. In the current case, it is obvious that XYZ Ltd is the one to be held liable for the damage of property in the housing estate. However, it is not XYZ ltd fault that the fire broke up. They might have contributed to the damage under strict liability by storing the fireworks on the premises but is the negligence of the contractors that lead to the fire breaking out. Therefore, both XYX ltd and the contract contributed to the property damage. Therefore, as per S1 of the civil liability act 1978, XYZ Ltd has the right to seeks indemnity from the contractor as they jointly cause the damage for which XYZ is held liable.