Risk Plan Minimizing Tort Liability

A risk plan is very useful in minimizing tort liability which is generally occurred due to public allegation or others intrusion in business activities. A proper compliance over governed rules and regulations can prevent any company to face tort liability that may be expensive and even devastating for a running business because it can lead a business towards a lawful band as per prescribed rules and regulations.

Alternative Solutions
Risk
Probability
Consequence
Severity
Mitigation Techniques and Strategies
Confront Kelly Bates in judiciary on grounds of complying EPA levels

Case could be lose due to incurrence of excessive time and technical cost
Average
Liability can be held on Alumina on grounds of occurred violation five years before.
Intense
Regulation of environmental audits independently

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Checking the background of Mrs. Gates as may be she had filed such case against other firm

More legal counselors ma be appointed for better supporting the case
Printed articles may simply be ignored
Guilty act may be obvious on part of the company

Further lawsuits may be consulted.
High
Prestige of firm may be disgraced

Costly case may be borne incase of first legal action initiated by others
Intense
Allegation should be addressed in front of pres conference

The done audit (pertaining to environment) should be publicized which will show evidence of company’s compliance.
Mrs. Bates along with reporter may be threaten for legal suing
Overall favor could be given to Mrs. Gates by public opinion court
Average
The issue of velocity and tone may be worsen
Intense
Privately approach Mrs. Bates for available solution and voicing general concerns

Tort liability which is a regulatory risk can be controlled by means of corrective and preventive measures. The occurrence a tort liability exists due to intrusion in the rights of individuals where organization’s wrongdoing affects damages. A company can be charged quite expensive consequences upon confrontation of a tort liability. A risk plan minimizing tort liability should be regulated for defending such potential cases. The following case identifies the preventive and detective measures related to tort liability and regulatory risk of ‘Alumina’ which is recognized as a $4 billion United States company.

Five years before, Alumina was found guilty by Environmental Protection Agency (EPA) due to surpassing the approved emission level. The violation was corrected and cleaned up which was perceived the resolution of issue. Yet, the potential impact of unsanitary water was not oversaw which was, inadvertently, a discharge means violating the laws of EPA. The poisoning of Dira Lake was the tort which caused life threatening serious issue for the community. A company can be dissolved incase of EPA’s involvement and negative publicity. If Alumina fails to justify and defends itself by proving the systemic detection and maintenance of community safety levels, then the business of Alumina will be forced out of industrial practices. The potential tort liability must be managed by Alumina in the form of a report which should be displayed to public. The report must clarify that PAH levels are under the approved limits and tests are also conducted on regular basis. The corrective measures should too be stated in the report, if, level of PAH has increased.

A specific tort liability confronted by Alumina was ‘negligence’. Alumina was accused by Kelly Bates for negligent practice and improper maintenance of prescribed levels of PAH in accordance with EPA standards. The primary reason was accusation was ‘leukemia caused to Bates daughter’. Incase of getting evidence of being careless in maintaining non-conformity in EPA standards, Alumina can be publicized accordingly for such wrongful act. Such kind of tort can be prevented by Alumina through visualization of existing stellar work history. The raised tort can also be prevented by means of expertise training and providing comprehensive perception about the regulations of EPA to all its employees.

The accuser, Kelly Bates, can be charged for defamation tort by Alumina, if proper documentation and evidence are not supported by Mrs. Bates to prove her claim worth. Moreover, such negligence tort could have been stopped by Alumina upon showing the documented procedures which are necessary for complying the regulations of PAH levels. Alumina could also prevent such accusation by showing the proper documentation to Mrs. Bates which could prove the compliance of PAH regulatory levels. Furthermore, company’s finance amounting to millions of dollars would too have saved due to expenses involved in the arbitration system. Also, it would save company from settlement cost incase of proved guilty.

Extensive research and inside perception could save Mrs. Bates and reporter from libel defamation (a kind of tort liability) that had charged due to printing such a guilty story. They should understand that the reasons for high PAH levels and pollution violation were not Alumina, but the caused occurs due to extensive traffic system on water ways.

Alumina also faces a legal issue which is the disclosure of sensitive information. As per the Freedom of Information Act (FOLA) legal principle, merely certain information is shared publicly by companies upon need basis but, Alumina had to share sensitive information which could have affected negatively in company’s relationships with its clients. A promising discretion is required to be practiced which may be useful for the company. The overall release of sensitive information could have disclosed the company’s secret matters which are not even disclosed to existing employees other than top and leading executive management. Conversely, the public would too perceive Alumina as guilty and negative performer incase of hiding releasing little information. In accordance with FOIA laws, a legal counsel could prevent Alumina management from all such torts being faced earlier.

Alternative Dispute Resolution (ADR) could be a wise option for such resolution instead of litigation. The situation is solved effective and efficiently in a timely manner from Alternative Dispute Resolution which is generally cheaper than litigation. A decision maker and timings can be chosen by both the parties. Additionally, the parties may be forced through ADR arbitration system or ADR mediation system. The position of opponent is clearly understood by Alumina. Moreover, the information can too be kept secure among both the parties. Thus, the ADR is recommended to be pursued by the company. Just like some advantages, one disadvantage may be the negotiation of ADR cases with many parties for better resolution.

The risks like regulatory liabilities and torts occur usually upon execution of a business. Yet, the damages can be effectively reduced by the management. Various kinds of torts such as Alumina case can be resolved and refrained through compliance of law. Still, all torts cannot be restrained merely complying the law, therefore, it is in the interest of a company to identify measure and resolve any such issues that may arise in future and cause inconvenience to the general public.

References

Minsky, S. (2005), Developing Risk Plans, Retrieved on May 1, 2010 from

http://www.ebizq.net/topics/tech_in_biz/features/6021.html

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