Principles of Risk Management and Insurance, 13th Edition

Application Questions

1. Smith Construction is building a warehouse for Raymond. The construction firm routinely leaves certain construction equipment at the building site overnight and on weekends. Late one night, Fred, age 10, began playing on some of Smith’s construction equipment. Fred accidentally released the brakes of a tractor on which he was playing, and the tractor rolled down a hill and smashed into the building under construction. Fred was severely injured in the accident. Fred’s parents sued both Smith Construction and Raymond for the injury.

   1. Based on the elements of negligence, describe the requirements that must be met for Smith Construction to be held liable for negligence.

   2. Describe the various classes of persons that are recognized ...