Economic Loss

Question 1

Economic Loss

Answer 1

Courts are less willing to hand out compensation for economic loss.

Question 2

1) Economic loss resulting from a defect to property

Answer 2

Spartan Steel and Alloys Ltd v Martin & Co - Power cable cut, which caused a factory to stop working. Got compensation for solidified metal, and damages products, but not the products they could have made in that time. 5 questions to ask:
Intrinsic value 
Social Interest 
Market Freedom 
Risk Allocation 
Indeterminacy 
Nacap Ltd v Moffat Plant Ltd - Couldn't get compensation as damaged occurred from another's property 
No compensation for pure economic loss

Question 3

2)Economic loss resulting from damage in Property

Answer 3

Anns v Merton Borough Council - Took it as property damage but was like this from the beginning. Seems like pure economic loss
Murphy v Brentwood District Council - Identical to Anns, but overruled and said there is no claim for pure economic loss
Scotland could have a different position - NZ case appealed all the way up couldn’t make decision for other jurisdictions. Junior Books v Veitchi Co Ltd - Built floor then cracks appear, granted damages
Bellefield Computer Services Ltd v E Turner & Sons Ltd - Firewall inadequate, allowed damage to the equipment but not building compensation
Stevenson v A & J Stephen (Builders) Ltd - Held builders liable for both this time as inadequate but home?

Question 4

3) Economic Loss from a misleading remark

Answer 4

Hedley Byrne & Co v Heller and Partners Ltd - There needs to be a fiduciary relationship, which means a close tie of dependancy, and assumption of responsibility and willingness.
Caparo Industries plc v Dickman - No fiduciary relationship, auditors info was not for those who suing John Kenway Ltd v Orcantic Ltd - Hedley Bryne principle part of Scots law
Cramaso LLP v Earl of Seafield - overestimate on population of grouse.

Question 5

4) Economic loss resulting from inadequate services

Answer 5

Henderson v Merrett Syndicates Ltd - Suffer loss due to inadequate service, boundary between contract
White v Jones - Solicitor didn’t rewrite will till dead, tried to sue him but there was no fiduciary relationship

Question 6

Which questions must be asked

Answer 6

1) Reasonably foreseeable?
2) Establish proximity (i) No risk of indeterminacy then fiduciary relationship (ii) If is indeterminacy
3) Is it fair to impose it? Caparo test

Question 7

Hedley Bryne Priciniple and Murphy Principle applying at same time

Answer 7

Smith v Eric S Bush - House for sale
Stevenson v A & J Stephen - Murphy eclipsed by postive Hedley rule
Customs and Excise Commissioners v Barclays Bank - Freeze assets then got assets, doesn’t fall under 4 types but can use Caparo test