2022 Question 4 — LawShortcut Independent Model Answer
Negligent Misstatement · Bank Credit Reference · Pure Economic Loss
Scenario summary
Green Ltd imports fertiliser and trades on 90-day credit. Before taking on Chancer Ltd as a distributor, it looks for a credit reference. Green's own bank, Banker plc, is unable to appraise Chancer because Chancer banks elsewhere, so it approaches Dubious Bank plc, Chancer's bank, spelling out that the enquiry is being made on Green Ltd's behalf.
Dubious Bank, without looking into Chancer's financial record, reports that Chancer is on a sound financial footing and attaches no disclaimer. Trusting that reference, Green fills orders in September 2021, December 2021 and March 2022. Not one is paid, and by June 2022 Chancer is bankrupt, owing €1 million.
Candidates are asked to advise Green on the tort claims available to it here and on the damages recoverable.
This is a LawShortcut scenario summary written in our own words. For the exact examined wording, use the official King’s Inns paper linked above.
What this model answer covers
Issues and structure addressed in the full LawShortcut model answer:
- 1. Green Ltd v Dubious Bank plc
- 2. Green Ltd v Banker plc
- 3. Damages
Read the complete LawShortcut model answer to this question — reading the question, issue spotting, the applicable law, application to the facts and conclusions — inside the King’s Inns Tort Model Answer Vault.
Part of the King’s Inns Tort Model Answer Vault — 30 independently authored model answers, 2020—2025.