1) A person is not automatically liable for the torts they commit. The first step in establishing liability is to prove that owed a duty of care to the injured party.
2) In the absence of a contract the courts have defined in Donoghue v Stevenson the neighbor principle being:
‘ You owe a duty of care to anybody who it may be reasonably for seen will be affected by your negligent acts or omissions ‘.
3) A consequence of the Donghue ruling is that the scope of duty of care is extremely wide. The courts have subsequently narrowed this duty in relation to auditors.