Identifying the Facts and Issues

Smitty was hired$$

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$.$ There$$

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evidence that Smitty did not complete the analysis within the stated time period. There$$

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$$evidence that Smitty did not provide Hailey with a complete report as required in the contract. Smitty likely$$

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$$liable to Hailey for breach of contract.

Assessment question

Smitty had a duty of$$

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$$to Hailey. This duty required Smitty to act as$$

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$$would act. A reasonable accountant$$

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$$familiar with tax rules and regulations when asked to perform an analysis on a deal to determine if it would result in tax liability. A reasonable accountant$$

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explore a client$$s entire financial situation when asked to assess whether a transaction would result in a tax liability.

Assessment question

Smitty$$

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$$include an analysis of this transaction in relation to Hailey$$s overall financial situation. Smitty likely$$

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$$breach his duty. This action$$

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$$cause harm to Hailey in the form of a tax liability. Smitty$$s action$$

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$$cost Hailey money. Smitty likely$$

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$$commit negligence.

Assessment question

What If the Facts Were Different?

Assume that Smitty did a thorough investigation of Hailey$$s financial situation, including an interview of Hailey about her assets and financial transactions. Smitty then assessed the contract in light of this information. The next year, Hailey had a tax liability, but it was based on the fact that she forgot to mention to Smitty that she had also sold three pieces of land to private buyers earlier in the year. Is the firm liable to Hailey for negligence?

In this situation, Smitty$$

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$$assess the transaction and$$

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$$conduct a thorough investigation of Hailey$$s financial situation.

Assessment question

In this situation, Smitty$$

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$$have all of the information he needed to offer the best advice to Hailey and$$

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$$missing information about prior land sales. The fault for the error lies with$$

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$.$ If sued for negligence, Smitty$$s best defense would be that the$$

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$$negligent$.$