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Each question consists of legal propositions/ principles (hereinafter referred to as 'principle') and facts. These principles have to be applied to the given facts to arrive at the most reasonable conclusion. Such principles may or may not be true in the real sense, yet you have to conclusively assume them to be true for the purposes of this section. In other
words, in answering the following questions, you must not rely on any principles except the principles that are given herein below for every question. Further, you must not assume any facts other than those stated in the question. The objective of this section is to test your interest towards study of law, research aptitude and problem solving ability even if the 'most
reasonable conclusion' arrived at may be unacceptable for any other reason. It is not the object of this section to test your knowledge of law.
PRINCIPLE: Damage without the violation of a legal right is not actionable in a court of law. If the interference with the rights of another person is not unlawful or unauthorized, but a necessary consequence of the exercise of defendant's own lawful rights, no action should lie.
FACTS: There was an established school ('ES') in a particular locality. Subsequently, a new school ('NS') was set up in the same locality, which charged lower fees, on account of which people started patronising the new school. Because of the competition, 'ES' had to reduce its fees. 'ES' filed a case against 'NS' saying that 'NS' had caused it ('ES') financial loss and, thus, claimed compensation.
Which of the following derivations is CORRECT?
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