Guarantees And Negligence

Question 1

Donoghue v Stevenson

Answer 1

Negligence

Foundational case which established the requirements for negligence:

1) duty of care
2) breach of duty
3) damage

Facts: decomposed snail in ginger beer

Question 2

Smith v Eric S Bush

Answer 2

Negligence/exclusion clause

Facts: surveyor who knew report of building would be shown to claimant, was found to be negligent for not detecting structural defect which caused significant damage later. The exclusion clause denying responsibility and inaccuracy was unreasonable and ineffective under UCTA

Question 3

Hedley Byrne v Heller

Answer 3

Negligence and pure economic loss

It is possible to recover compensation for financial damage through reliance on statements made negligently where there is a special relationship between the parties.

1) reliance by C on D’s specialist skill
2) reasonable expectation of knowledge by D that C would rely on
3) it was reasonable for C to rely on D
4) requires express/implied assumption of responsibility on D

Facts: H asked X if it was advisable to extend credit to customer, X said yes. Customer went out of business and H sought damages under negligence, but court held no duty based on facts.