Also known as: duties of care
Written by attorneys · grounded in primary & secondary sources — see below
A legal obligation requiring a person to act with the care that a reasonably prudent person would exercise under similar circumstances. In fiduciary settings the obligation requires refraining from grossly negligent or reckless conduct, willful or intentional misconduct, or knowing violation of law. The obligation extends only to those persons within the range of reasonably foreseeable risk created by the actor's conduct.
Doris Duffy operated a scale at a busy train station. When a passenger dropped a package containing explosives, the resulting blast knocked over a scale that struck Danielle Dixon standing several feet away. Dixon sued Duffy for negligence. Because Dixon stood inside the zone of danger that a reasonable person would have foreseen from mishandling the package, Duffy owed her a duty of care.
Derek Douglas served as a member-manager of Dillon Energy, an LLC. He approved a high-risk drilling contract without reviewing geological reports or obtaining required permits. The project caused substantial losses. The other members sued Douglas, alleging he breached his duty of care by engaging in grossly negligent conduct.
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Damian Decker and Delilah Duran formed a limited partnership to develop commercial property. Their agreement attempted to eliminate the general partner's duty of care entirely. When a later dispute arose over a failed investment, the court examined whether the agreement validly altered that duty under the statute.
Devon Drake and Doris Duffy operated a consulting partnership. Their agreement purported to eliminate liability for any negligent decisions by partners. When a client lost money because Drake failed to verify key data, the court assessed whether the clause could lawfully remove the duty of care.
Danielle Dixon witnessed a car crash caused by Dover Bank's negligent driver. The sight triggered severe emotional distress that manifested as physical illness requiring hospitalization. Dixon sued the bank. Because the duty of care was designed to protect against fright creating an unreasonable risk of bodily harm, the bank remained liable even though harm occurred solely through internal operation of the fright.
Derek Douglas met with attorney Damian Decker for an initial consultation about a potential contract claim. Decker gave advice on the claim's viability and promised to investigate further but never followed up. The statute of limitations expired. Douglas sued Decker for malpractice. Because an attorney-client relationship and its attendant duty of care arose from the consultation and reasonable reliance, Decker could be held liable.
No. The duty extends only to plaintiffs within the range of reasonably foreseeable risk created by the defendant's conduct at the time of the negligent act. A defendant owes no duty to a person situated outside that zone even if injury in fact occurs.
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A member must refrain from grossly negligent or reckless conduct, willful or intentional misconduct, or knowing violation of law in conducting or winding up the company's activities.
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A partnership agreement may not alter or eliminate the duty of care except as otherwise provided in the statute's limited exceptions addressing good faith and fair dealing.
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Yes. An attorney-client relationship and its attendant duty of care can arise when the lawyer gives legal advice and the prospective client reasonably relies on it, even without a formal retainer or fee.
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…N.Y. App., 99 N.E. 138, 141 (1912). Thus, a director's duty to exercise an informed business judgment is in the nature of a duty of care, as distinguished from a duty of loyalty. Here, there were no allegations of fraud, bad faith, or self-dealing, or proof thereof. Hence, it is presumed that the directors reached their…