LAW 122 Chapter 2: LAW 122 - Chapter 1 .docx

• School: Ryerson University
• Department: Law and Business
• Course: LAW 122
• Professor: Omar Ha Redeye

Document Summary

Risk reduction: some risks can be reduced to an acceptable level through precautions, example: a bank that lends 000 to a manufacturing company realizes that the economy is going to go into a recession; bank protects itself by requiring business to grant a mortgage on the factory; this way if bank doesn"t get the money, they will get the property. If risk can not be reduced or avoided, it can be shifted onto a third party: two most important are insurance and exclusion clause, example: a construction company requires use of a temporary crane; option 1 is to rent a crane and have it operated by one of its own employees; option two is to hire an independent contractor to operate it; if a bystander is injured by the careless use of the crane, the independent contractor would be sued and the company would not be vicariously liable.