Negligence III: Economic Loss & Defences Flashcards
Who is able to sue for property damage?
The Aliakmon
A claim can only be made by a claimant with legal or possessory title to the property at the time damage occurs
What is the general rule on damages for defective property?
Spartan Steel v Martin
Pure economic loss that is not a consequence of physical damage is not recoverable in negligence
Murphy v Brentwood DC
* Loss caused by need to repair defective property to remove the danger is a financial loss
* Until physical damage occurs, the loss associated with making the house safe is purely economic
What is the exception to defective property given by Lord Bridge?
Murphy v Brentwood DC
If the source of the danger stands so close to the boundary of neighbouring land, the owner will have a claim against the negligent builder for the cost of obviating the danger to protect his own liability from 3rd parties
What statutory duties exist in relation to defective property?
Defective Premises Act 1972
* S1(1) provides the builder taking on work in a dwelling owes a duty to see that his work is done in a workmanlike and professional manner so that the dwelling be fit for habitation
* S1(4) a person who makes arrangements for services to be provided shall be treated as amongst the people who have taken on work
S3 Latent Damage Act 1986
* Provides accural of cause of action to successive owners for latent damage to property
S148 Building Safety Act 2022
Liability relating to construction products
When will loss for a negligent misstatement be recoverable?
Hedley Byrne v Heller
* Where the statement was made in a special relationship where C could reasonably rely on the care and skill of D
* D must have been said to undertake an assumption of responsibility
How have the principles of Hedley Byrne been developed?
Caparo v Dickman
1. D must be aware of the nature of transaction which C has in mind
2. D must communicate the info to C directly or know it will be communicated to them
3. Must anticipate that C will properly and reasonably rely on the information
4. Purpose for which C relies on info must be connected with interests that it was reasonable to require D to protect
Henderson v Merrett Syndicates
Hedley Byrne principle extends to provision of services. Where C entrusts D with the conduct of his affairs, C can be held to have relied on D to exercise due skill and care in such conduct
How have the rules on negligent misstatements and third parties developed?
Smith v Eric Bush
D can be liable to a third party where they were aware of their identity, knew their advice would be transmitted to them and appreciated that they would rely on it
White v Jones
* D may also be liable for negligent provision of servicves to a third party who suffers a loss of expectation as a result of negligence in the course of a service meant to benefit them
* There will be liability where they is a conscious assumption of the task
How is the case of assumption of responsibility different with regards to professionals?
Robinson v PE Jones
* The principle does not apply in non-professional contractual relations, builders do not assume a responsibility to building owners, but architects or engineers may
* Where there is assumption of responsibility, the existence of a contract does not prevent a duty of care from arising (Henderson)
* Beyond professional relations, contractual and tortious liabililty are not always concurrent
What defences can apply to a case in negligence?
- Contributory negligence (Jones v Livox Quarries)
- Volenti non fit injuria
How will contributory negligence be determined?
- Law Reform (Contributory Negligence) Act 1945
- Jones v Livox Quarries: A person is guilty of contributory negligence if he ought to have reasonably foreseen that if he did not act as a reasonable prudent man, he might be hurt himself. Must not only be a circumstance of the accident but a cause of it
- Reeves v Commissioner of Metropolitan Police: Duty of care can still arise where a person injures themselves deliberately if they are unaware of the risk, too young or not of sound mind
- Froom v Butcher: In seatbelt cases, if damages would have been the same there is no reduction. If damages would have been prevented altogether, 25% reduction. Where injuries would have been less severe, 15% reduction
How might a person exclude their liability for injury?
Unfair Contract Terms Act 1977:
* S1 sets out definitions
* S2(1) A person cannot by contract term or notice exclude or restrict liability for death or personal injury from negligence
* S2(2) In other loss or damage, this is only allowed where it is reasonable
* S2(3) Person’s agreement or awareness is not to be taken as a voluntary acceptance of any risk
(BUSINESS TO BUSINESS)
Consumer Rights Act 2015
* S61-71 sets out requirements for unfair terms
* S65: Trader cannot by term or notice exclude liability for death or personal injury from negligence. Person is not taken as having voluntarily accepted risk (this applies to negligence and the OLA 57 duty)
* S73: does not apply to term or notice that reflects mandatory statutory or regulatory provisions
* S75: Makes schedule 4 effective
(BUSINESS TO CONSUMER)
S149(3) Road Traffic Act 1988
How does the defence of volenti non fit injuria operate?
- ICI v Shatwell: Where employees deliberately disobey an order though they known the risk involved, volenti will be a complete defence where the employee is only vicariously liable
- Nettleship v Weston: Knowledge of the risk is not enough, nothing will suffice short of an agreement to waive any claim for negligence
What is the defence of illegality?
- Gray v Thames Trains: You cannot recover for losses from criminal sanctions imposed as a result or your own illegal act (NARROW) or you cannot recover for damage which is the consequence of your own criminal act
- Patel v Mirza: The rationale of the defence is that it would be contrary to the public interest to enforce a claim if to do so would be harmful to the integrity of the legal system (Policy approach, a person should not profit from his wrongdoing)
How does the defence of illegality operate?
Patel v Mirza, there are three considerations to make
1. Purpose of the prohibition transgressed and whether this would be enhanced by denying the claim
2. Any other public policy that denying the claim may affect
3. Whether denying the claim would be proportionate to the illegality, noting it is not for the civil courts to punish individuals
Made clear in Henderson v Dorset Healthcare that the old principle in Gray can still apply alongside Patel. Gray is compatible because it is based on public policy rules and should apply in similar cases
should not be able to profit from wrongdoing
