LAW 122 Lecture Notes - Lecture 1: Critical Role, Property Insurance, Ultra Vires
6 Oct 2016
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Avoidance - not engage in risky business activity (not sell certain product or service ie. cars with exploding fuel tanks) Reduction - reduce occurrence of risk by modifying business practices (wiping floor if wet) Shifting shift risk to another party through contract or through insurance policy (purchase insurance for car accident) Acceptance sometimes appropriate for business to accept the risk (lucrative contract: examples of risk management: Exclusion and limitation clauses: contractual terms that exclude liability for certain types of acts / losses, or that limit the amount of compensation available. Incorporation: limited liability : directors and shareholders are not usually liable for debts of the company. Moral obligation (raises ethical considerations as well: moral wrongs are informally sanctioned - loss of friendships or damaged reputation, legal wrongs are formally sanctioned - imprisonment or payment of damages. Ethical reasoning: focus on why something is ethically right or wrong, not just whether it is right or wrong.
