To have the schools valued for insurance purposes, a school district hired a firm of surveyors to give them a statement of value. To prepare the report, the surveyors took the relevant measurements, which were then given to a statistical tabulating company that does the calculations based on the measurements. Surveyors always use the services of such tabulating companies. An error was made in the calculations, so the surveyor's report was wrong. Therefore, the buildings were under-insured. When one of the school buildings was destroyed by fire, the school district did not get sufficient funds from the insurance company to rebuild the school. On these facts, which of the following is true? (Assume that the school district has the ability to sue and be sued in court.)

A) This action would most likely be commenced in the Small Claims Court.
B) The insurance company can successfully sue the statistical tabulating company for nuisance.
C) The school district can successfully sue the statistical tabulating company for negligent misstatement causing economic loss.
D) The school district could successfully sue the surveyors for nuisance, for subcontracting the calculating work.
E) The statistical tabulating company cannot be sued by the school district.

Question

Marissa Morford · Accepted Answer

Final Answer : C, Explanation :  The school district can successfully sue the statistical tabulating company for negligent misstatement causing economic loss because the error made by the tabulating company directly led to the school being under-insured, which resulted in insufficient funds being available to rebuild the school after the fire.

Definitions

Learning Objectives

Learning Objectives

Related questions