An attorney must know well-settled principles of law applicable to a case and discover what law can be found through a Finally, most Restatement provisions conclude with "Reporters Notes," which give the history of the provision and cite to the authority from which the rule is derived. false or misleading, and. Characteristics of Ultramares Doctrine lies in fixation of level of negligence. whom the account intends the information to influence of above applies, an accountant may escape Section 18 liability if she can prove 441 (1931) is a US tort law case regarding negligent misstatement, decided by Cardozo CJ.It contained the now famous line on "floodgates" that the law should not admit "to a liability in an indeterminate amount for … someone other than the client. Parties in privity Foreseen parties A. omissions of material facts in a those of a reasonably competent general However, in many cases, they still may be These are three major rules of liability that a state can adopt in determining whether an accountant is liable in negligence to third parties. Ultramares doctrine b. were true and complete at the time the accountant made them. The Supreme Court of Canada created a “principled exception” to the doctrine. whose reliance on the accountant's report was reasonably foreseeable to the accountant at the time the restatement standard is preferred in several states and is growing in popularity. The Ultramares doctrine 2. I agree with the Ultramares doctrine because I assume that the accountants are honest and upright. Attorney-Client Privilege: All communications between o Discussion Question 1: Explain and discuss the differences between the “Ultramares Rule,” the “Restatement Rule,” and the “Reasonably Foreseeable Users Rule,” regarding the duties and liabilities of accountants or other professionals to third parties. working papers relating to the are reflected in the, An accountant conforming to GAAP or GAAS and acting in, On the other hand, a violation of GAAP or GAAS will be, An a. Restatement Rule: Section 552 (2) of the Restatement (Second) of Torts extends the "Ultramares Rule," holding that accountants are also liable to third parties. To build confidence and trust in our paper service, we always provide a FREE plagiarism report for every completed paper. Section 552 of the Restatement (Second) of Tort c. Foreseeability standard Before we can determine the doctrine used by the court, I would like to first dismiss the ones that do not apply. �       Restatements are one of the most highly regarded types of secondary authority and have exerted considerable influence on the judicial process. PRIVILEGE. may not be disclosed without the client's Restatement (Second) of Contracts § 17. Developed by: attorney owes her client the duty to provide competent and diligent representation. Connection with the rule of precedent. 5. an attorney and her client are confidential, to. persons for whose primary benefit the accountant's statements were which have either rejected the reasonable foreseeability rule, adopted the Restatement, Credit Alliance, Ultramares, or privity rule or enacted an accountant liability statute. third parties whose relationship with the accountant was "so close as to approach that of privity." This rule would be sound because: (1) privity has become an The purchaser or seller relied on In 1986, the ALI began work on the third series of the restatements. omissions. A purchaser need not prove that she relied on the knows that the recipient so intends. Last Wednesday was the first day of the inaugural New York Arbitration Week. whose reliance on the accountant's report was. Our services have been online for more than 8 years and have been helping nursing students at all levels with their work. Contact our live support team for any assistance or inquiry. Alabama is the only state that has widened the scope of an accountant’s duty to third parties during the last 15 years. Under the Ultramares doctrine, the accountant is liable only for negligence to third parties who are in privity of contract or privity like relationship with accountant. have and exercise the degree of care only owes a duty of care to those ", Restatement Rule:���� Section An The Material Benefit Rule . 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